MONTREAL – Valeant Pharmaceuticals says it will likely boost cash and stock incentives in the coming weeks to retain more key staff amidst turmoil that has caused the company’s share price to plummet.
The changes would extend a program that was recently implemented for about 70 employees below the executive level, Laurie Little, senior vice-president for investor relations, told a conference in London on Wednesday.
“I think in the U.S. definitely there has been some anxiety,” she told the Jefferies global health-care conference, which was webcast.
Valeant (TSX:VRX) is feeling pressure because senior employees receive some of their compensation in stock.
The company’s shares, which peaked at $347.84 in August, have since fallen 73 per cent amid allegations of drug price gouging, accusations it has denied, as well as a controversy about its relationship with Philidor Rx Services, a U.S. mail-order pharmacy. It also faces class-action lawsuits as well as judicial and Senate investigations.
“We’ve always said that the lifeblood of our company is having the right people in the right places and through this turmoil we definitely don’t want to see an exodus,” Little said.
Employees outside the U.S. are largely “insulated” from such concerns because Valeant isn’t as well known or it operates under Bausch & Lomb or local brands, she added.
Little reminded investors that most of its business is unaffected by disruptions caused to dermatology and some prescription drugs. Valeant is also working on a solution to replace Philidor, a move that will result in more of its drugs being sold through traditional pharmacies.
Meanwhile, Little said the company expects interest in Addyi, the libido drug incorrectly dubbed the female Viagra, will grow as more people are educated about the controversial medication.
“We never thought it would be a rapid uptake,” she said when asked about the low number of early prescriptions.
The drug, which Valeant purchased for more than $1 billion, has potentially serious side-effects, especially for patients who consume alcohol or certain other medications.
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