Mobile Menu - OpenMobile Menu - Closed

Cummings Demands Information That Valeant is Withholding From Congress

Apr 12, 2016
Press Release

Cummings Demands Information That Valeant is Withholding From Congress

 

Seeks Documents and Interviews About Company’s Relationship With “Phantom Captive” Pharmacy

 

Washington, D.C. (Apr. 12, 2016)—Today, Rep. Elijah E. Cummings, Ranking Member of the House Committee on Oversight and Government Reform, sent a letter to J. Michael Pearson, CEO of Valeant Pharmaceuticals, requesting information the company has been withholding from Congress for months about its relationship with Philidor Rx Services—a “phantom captive” pharmacy that Valeant allegedly used to mask its prescription drug price increases and circumvent the traditional health insurance reimbursement process. 

“Your refusal to cooperate fully with Congress is extremely troubling and reflects a pattern of obstruction that impairs our ability to protect the American people against your company’s exorbitant price increases,” Cummings wrote.

Cummings sent his first letter to Pearson in November requesting transcribed interviews with several current and former Valeant employees who reportedly helped run Philidor’s business operations, including its questionable billing practices, despite Valeant’s claims that Philidor “operates independently.”  Cummings sent Pearson a second letter in December requesting documents about Valeant’s relationship with Philidor and its decision to withhold information from their shareholders.  Pearson has refused to provide any documents in response to these requests or make any Valeant employees available for interviews.

In today’s letter, Cummings explained that, despite an internal review by an ad hoc committee of Valeant’s Board of Directors, Congress still knows very little about the relationship between Valeant and Philidor, particularly with respect to allegations that Valeant employees had improper ties with Philidor, including the use of fictitious email identities in their communications with Philidor employees to conceal their connections to Valeant.

“The ad hoc committee’s failure to report on these claims is troubling, particularly given that this alleged misconduct occurred at the same time Valeant was improperly recognizing revenue from Philidor,” Cummings wrote.

The Oversight Committee held a hearing on February 4, 2016, with Howard Schiller, who was serving as Valeant’s interim CEO at the time.  The Committee originally invited Pearson, but he was excused for health-related reasons before returning to Valeant in February.  Cummings also released a memo ahead of the hearing summarizing efforts by Valeant executives who are “lining their pockets at the expense of some of the most vulnerable families in our nation.”

Click here to read today’s letter.

 

114th Congress