Formerly known as Valeant, Bausch Health Companies has dropped its old moniker and changed strategies in a years-long turnaround effort. Now, it’s moving past another part of Valeant history through a $1.2 billion class action settlement agreement.
RELATED: Former executive’s fraud trial dredges up a scandal Valeant would love to forget
The drugmaker on Monday agreed to settle a class-action lawsuit brought by investors who argued shares they bought from 2013 to 2015 were artificially inflated. Once details about Valeant’s business practices—including its relationship with specialty pharmacy Philidor, which eventually landed executives from both companies in prison for fraud—went public, the company’s share price plummeted, they argued in the lawsuit.
The agreement allows Bausch to “close the door on one of the more meaningful and unpredictable liabilities associated with the legacy Valeant era,” CEO Joseph Papa said in a statement.
Papa joined Bausch in 2016, and the drugmaker dropped its former name in 2018. As part of the turnaround, Bausch has pledged to limit price hikes. Valeant had been known for aggressive price hikes, and it faced congressional scrutiny over that issue and other business practices.
RELATED: Meet the new Valeant: Drugmaker drops tainted name to become Bausch Health in July rebrand
Bausch admits no liability or wrongdoing under the agreement. The drugmaker maintains its ability to invest in itself is unaffected through the deal, and it’ll start making payments in the middle of January.
To fund the settlement agreement, which must be approved by a court, Bausch said it could use a combo of options including cash on hand and an existing credit line.
