Valeant plunges as it cuts guidance and issues warning for 2017

Canadian drugmaker Valeant Pharmaceutical International (TSX: VRX) saw $2 billion wiped off its market capitalization after it cut its full-year 2016 guidance and issued a warning that sales and profits would continue falling in 2017. The company’s shares fell 22.16% to $14.89 in late New York trading yesterday.

Beleaguered Valeant said that total revenues in the third quarter of 2016 were down 11% to $2.48 billion, primarily due to a decline in product sales revenues from its existing businesses, and just below the $2.49 billion analysts anticipated. Third quarter revenues were also impacted by negative foreign currency exchange, as well as divestitures and discontinuations, which were partially offset by incremental product sales revenues from acquisitions completed in 2015.

The company recorded a net loss attributable to Valeant of $1.22 billion, or $3.49 per share, in the quarter ended September 30, compared with a profit of $49.5 million, or $0.14 per share, a year earlier.Valeant took a goodwill impairment charge of $1.05 billion in the latest quarter. Earnings, adjusted for one-time items, came to $1.55 per share widely missing the $1.78 analysts expected.