Bausch Health: an ex-sinner to buy now

Pharmaceutical firm Bausch Health, formerly known as Valeant, is putting a dodgy past behind it.

Michael Pearson © Andrew Harrer/Bloomberg via Getty Images

J. Michael Pearson: BHC's era of excess is over
(Image credit: Michael Pearson © Andrew Harrer/Bloomberg via Getty Images)

Until four years ago, Valeant Pharmaceuticals now Bausch Health Companies (NYSE: BHC) was regarded as one of the world's most dynamic drug companies. In 2008, J. Michael Pearson became CEO. He argued that returns from research and development (R&D) were too low and uncertain, and instead went on a buying spree, acquiring other drug and biotech firms that he considered to be particularly promising. He also instituted a more aggressive pricing policy, as well as restricting the firm's operations so as to minimise its tax liability. In the short run this successfully boosted profits. The share price rose 15-fold from 2010 to 2015, and Pearson was hailed as a genius.

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Dr Matthew Partridge
Shares editor, MoneyWeek

Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.

He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.

Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.

As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.

Follow Matthew on Twitter: @DrMatthewPartri