Valeant Pharmaceuticals has taken some hits of late. At the end of March 14, a share of VRX at the NYSE would bring you $69.04. At the end of the following day, it was worth less than half of that, just $33.51. It has lost further ground since. What happened? Management had announced disappointing earnings figures, and cautioned that its debt holders could categorize it as in default if it missed an April 30th filing deadline. A week later, the bond rater Moody's downgraded Valeant, on the grounds that its cash stockpile was inadequate to its overall indebtedness. Meanwhile, as the departure of J. Michael Pearson, the long-time CEO, approached, shareholders naturally got nervous. They were nervous, that is, because always creates a case of the nerves in someone, often in many people. They weren't nervous as a recognition of Pearson's great leadership. Indeed, he had run up a heck of a lot of debt on acquisitions, some of which at least were of dubious ...
