Wherein I fix Valeant Pharmaceuticals (VRX.T)

04/05/2016

Just kidding. Nothing can fix Valeant Pharmaceuticals (VRX.T).

Canada’s Big Pharma Clown Car has been in an out of congressional committees wondering why it charges a small fortune for drugs it has recently acquired, then jacked up the price on. It’s shares have plummeted and the CEO went into hiding (sorry, was too sick to work), and now we find it has one of the biggest potential moneymakers in pharmaceutical history on its books and can’t figure out how to sell it.

Valeant is sacking staff, including its outside sales agents for Addyi, the female sexual dysfunction drug, because it didn’t hit sales projections of $100 million to $150 million per year.

The drug reportedly helps women of a certain age, who are experiencing a drop in libido, get that old desire to shag back. This is huge as, anyone who has ever been married knows, that desire heads south hard once kids show up. And once we men disappoint our partners one too many times by leaving our shirts on the laundry floor. Or not putting out the recycling.

This is the sort of drug a pharma company doesn’t have to pitch hard. It’s not one of those ‘this is a potential billion-dollar market’ deals, because anyone you talk about it to just KNOWS how many potential users exist for a treatment to this.

And yet, Valeant can’t sell it. I wonder why?

No, I don’t. They’re selling it for $800 per month. Because they are morons.

Of course, when they bought the company that produces the drug for US$1 billion cash and a share of future earnings, just a few days after it became FDA approved, that set a high financial mark necessary to make a profit down the road. But patients don’t give a crap how you make your money back, they just need their drug for a price they can afford.

And I don’t know any man who would spend $800 per month on Viagra, and you know sex is the only thing we care about, so how on earth does any pharma executive think they’re going to get women to drop eight C’s on a drug to restore something they physically don’t desire right now anyway?

Addyi, which should also be renamed to something the average person can pronounce, should be sold for $50 per month.

Yes, maybe Valeant wouldn’t see a profit on its investment in the first year, but imagine how many woman would give it a shot if that’s all it cost, and imagine how quickly word would spread (assuming it works) from person to person?

But that’s not the Valeant way. Valeant drives price increases and hopes the desperate will sell a car to continue their treatment.

And that’s why, when it dies (it’s down almost 90% from its peak of$347.84 last August), nobody will mourn its passing.

Valeant plans to “educate doctors” about the “unique benefits of this important product.” That’s it’s strategy; take some doctors out for golf.

My strategy? Short Valeant. It’s worst is yet to come.

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