Valeant Pharma (VRX) Under Criminal Investigation - WSJ

August 10, 2016 6:39 PM EDT

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(Updated - August 11, 2016 6:28 AM EDT)

Valeant Pharma (NYSE: VRX) shares are dropping after-hours Wednesday following reports from the Wall Street Journal the company is under criminal investigation.

Federal prosecutors are investigating if the company defrauded insurance companies by hiding its ties to mail-order pharmacy Philidor Rx Services LLC, according to the Journal.

The investigation could lead to criminal charges against former Philidor executives and Valeant, the report stated.

"Valeant has been cooperating and continues to cooperate with the ongoing Southern District of New York investigation," a Valeant spokesperson told the Journal.

VRX shares last traded down 3.7% to $26.30.



In a statement Thursday morning, Valeant said:

"Valeant previously disclosed in October 2015 that the United States Attorney's Office for the Southern District of New York commenced an investigation involving Valeant. We have been fully cooperating with the authorities throughout the investigation, and we are in frequent contact and continue to cooperate with the U.S. Attorney's Office for the Southern District of New York. We do not comment on rumors about investigations, and cannot comment on or speculate about the possible course of any ongoing investigation.

"Valeant takes these matters seriously and intends to uphold the highest standards of ethical conduct as we move forward with our mission to improve people's lives with our healthcare products."

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