Nice article by Matthew Herper this morning that discusses a recent presentation given by Valeant Senior leaders on the performance of Big Pharma R&D. As beautifully described in the piece, Valeant's presentation was slanted to make Big Pharma R&D look overly bad (which is an achievement as it has been challenged enough on its own merits) and also make its (Valeant) own business model look good. The piece describes how Valeant has cherry-picked the data to exclude successful Big Pharma projects to make it look more anemic as a whole. It does this by defining who IT thinks is a Big Pharma and excludes any products made by a company that underwent a merger (who didn't) or was in a co-marketing deal for a big drug (common). Bad, bad, bad.
The other point to the Valeant presentation was to say Allergan's R&D spend was too much. But their case is less convincing as the are using Big Pharma as a whole to make their point --- including a lot of REALLY bad R&D operations in that group and basically saying Allergan is guilty by association. This flies in the face of a recent analysis by Richard Evans that ranked Allergan as the number 5 drug company by R&D rating amongst the top 22 Big Pharma.
Bascially, Valeant is playing fast and loose with the facts and it really hasn't made a solid case against Allergan's R&D plan and execution being bad. And, this does not bode well for Allergan R&D in the future if Valeant is able to pull off its acquisition. At present, Allergan shareholders have stood on the sideline but soon may be asked to cast their vote. They had better look at Valeant's track record and probe into its apparent successes more deeply before they decide to embrace such a new owner. Else they end up with a new owner who strips the cupboards bare of Allergan's current assets in order to help pay for its acquisition and demise, while also teeing up the next acquisition target to further feed the Valeant monster.
Posted by Bruce Lehr June 12th 2014.