Activist investor Bill Ackman says “of course” he regrets investing in Valeant, the former stock market darling that has been hit with SEC investigations, Senate investigations, and a precipitous decline in its stock price.
“There’s been a lot of brain damage in the last five weeks working with the board,” Ackman said Monday in an interview with CNBC’s Scott Wapner.
Ackman joined Valeant’s board in March as Valeant’s CEO, Mike Pearson, announced his departure from the firm.
Ackman was also asked Monday whether he regretted not selling his shares in Valeant rather than getting even further involved with the company by joining its board.
“Any price would have been better” than Valeant’s current price of about $31, he responded.
Now, he said, he plans to help fix the company and incite a “meaningful” turnaround.
Valeant’s stock has plunged about 86% in the past year and almost 70% since October.
At the annual Berkshire Hathaway shareholder meeting over the weekend, Warren Buffett and Charlie Munger called Valeant a “Wall Street scheme,” enormously flawed, and “a sewer.”
In response to Buffett’s and Munger’s comments, Ackman told CNBC it was wrong to “indict Valeant on the actions of a few people” and “you don’t call Valeant a ‘sewer’ because the company made a mistake.”
Among other things, Valeant has been accused of price gouging -that is, buying drug companies and raising the prices on their products. Ackman, Pearson, and Valeant’s former CFO and interim CEO, Howard Schiller, on Wednesday testified before the US Senate about those accusations.
Asked about that, Ackman told CNBC: “I think it’s wrong to buy a drug and mark the price up 5X.”
Valeant released its 10-K report last week after multiple delays. It revealed that Valeant misstated financials in the first quarter of 2015, which reduces revenue by $21 million but increases profits by $24 million.
It also disclosed the company was undergoing investigations in North Carolina, New Jersey, Massachusetts, and New York.