Valeant Pharmaceuticals announced Monday that John Paulson has been elected to serve as a director, bringing the total number of independent members on the company's board to 10. Mr. Paulson is president of hedge fund Paulson & Co., which is the drugmaker's largest shareholder, with a holding of around 5.7 percent.
Joseph Papa, Valeant CEO, commented "with his significant business and financial expertise, John will be a strong addition to the board," adding "his experience will be especially valuable as we continue to execute on our transformational strategy to turnaround Valeant."
"The strategic plan to transform Valeant smartly focuses on rebuilding the company's core franchises in ophthalmology, dermatology and gastroenterology while simultaneously using the proceeds from the sale of non-core assets and operating cash flow to de-lever the company," Paulson stated, continuing "I am fully supportive of the strategy and leadership team at Valeant."
Valeant is looking to sell non-core assets in an effort to repay debt, agreeing earlier this month to divest its iNova Pharmaceuticals unit for $930 million in cash, having previously reached a deal to offload its Dendreon cancer business for $820 million.
Earlier this year, hedge fund manager Bill Ackman resigned from Valeant's board and sold his stake in the drugmaker.
Commenting on Paulson's appointment, Wells Fargo analyst David Maris said "it could be a sign that a major holder is frustrated with the pace and direction of change." Maris added "we do not know what new domain experience that Paulson brings to Valeant's board that was not already present, especially with ValueAct already on the board." In 2015, Valeant added ValueAct Capital partner D. Robert Hale to its board of directors.