valeant = enron?
great short if that's the case
great short if that's the case
Gotta love ZERO RISK in the SP500 = $$$
- Thread starter makloda
- Start date
does that count as a head and shoulders
does that count as a head and shoulders
yes, it's headed for 2009 lows
an overview of the VRX news
Valeant Pharmaceuticals (VRX -19.7%) is getting pummeled in early trading after perennial bear Citron Research issued a new report today titled, "Valeant, Could this be the Pharmaceutical Enron?"
The report accuses the company of routing its business through phantom specialty pharmacies in order to avoid scrutiny from auditors. The pharmacy network is home to various shadowy characters with dubious histories.
The genesis of this latest dust-up appears to be a lawsuit filed in California federal court by a small compounding operation named R&O Pharmacy owned by Russell Reitz and Robert Osbakken. Mr. Reitz received a letter from Valeant general counsel Robert Chai-Onn requesting payment of $69.8M for "invoiced amounts," despite the absence of any business between the two firms. The Southern Investigative Reporting Foundation (SIRF) found out that Mr. Reitz was doing business with Valeant through a firm called Philidor Rx Services, a "pharmacy administrator" with only one customer: Valeant. It appears to be a key component of Valeant's "patient access" program in which patients referred to Philidor receive reduced or waived co-payments given to the prescribers from Valeant sales reps. This makes all price increases less visible since most patients never see them.
Philidor appears to have gone out of its way to conceal its ownership. There is a fairly complex web of relationships that no one feels inclined to explain.
During Valeant's earnings call yesterday, CEO J. Micheal Pearson said that his company had purchased an option to acquire Philidor late last year and that Philidor's results are consolidated in Valeant's financial reports.
Whatever the outcome, Mr. Pearson appears to have some explaining to do.
Valeant Pharmaceuticals (VRX -19.7%) is getting pummeled in early trading after perennial bear Citron Research issued a new report today titled, "Valeant, Could this be the Pharmaceutical Enron?"
The report accuses the company of routing its business through phantom specialty pharmacies in order to avoid scrutiny from auditors. The pharmacy network is home to various shadowy characters with dubious histories.
The genesis of this latest dust-up appears to be a lawsuit filed in California federal court by a small compounding operation named R&O Pharmacy owned by Russell Reitz and Robert Osbakken. Mr. Reitz received a letter from Valeant general counsel Robert Chai-Onn requesting payment of $69.8M for "invoiced amounts," despite the absence of any business between the two firms. The Southern Investigative Reporting Foundation (SIRF) found out that Mr. Reitz was doing business with Valeant through a firm called Philidor Rx Services, a "pharmacy administrator" with only one customer: Valeant. It appears to be a key component of Valeant's "patient access" program in which patients referred to Philidor receive reduced or waived co-payments given to the prescribers from Valeant sales reps. This makes all price increases less visible since most patients never see them.
Philidor appears to have gone out of its way to conceal its ownership. There is a fairly complex web of relationships that no one feels inclined to explain.
During Valeant's earnings call yesterday, CEO J. Micheal Pearson said that his company had purchased an option to acquire Philidor late last year and that Philidor's results are consolidated in Valeant's financial reports.
Whatever the outcome, Mr. Pearson appears to have some explaining to do.
I didnt actually read the report at first, i just got short it as soon as citron put out the tweet, had i reaad that report i would probably still be holding but i was happy to take twenty bucks out of the stock, and just took my profit earlier today.
Quite a report...Since it's still possible (15 years post Enron) to create these sort of entities, it makes me believe there is alot more of this stuff out there...especially with an economy that is always losing traction...If I remember correctly Enron really hit the skids with that oil price shock in the Fall of 2001...
after some consolidation today,I think it could go down to $50
Max have you looked at WTW for a short
Yeah, i was looking at shorting it the whole time, but couldnt get a locate at any of my brokers, it might have saved me money cause it was kind of a tough short, like when it took out yesterdays highs i might have gotten cleared out this morning in the premarket, but might have had my stop on the other side of twenty bucks, so its hard to say how i would have played it, but i think it gets back to 15 eventually. The whole thing is a short squeeze, 75% of the float is short, Day three and beyond of those irrational moves is usually a good short entryi really dont think Oprah is worth a tripling of the stock price.
And i wouldnt be surprised at all to see VRX at 50 or lower if these allegations are true, especially with the way democrats are going after the drug companies right now, this is going to be wall to wall shaming of this company if the report turns out to be true, but im not willing to chase it this far down, just wish i had read the damn report.