- Bloomberg TV
Citron Research, the California-based short-selling research firm led by Andrew Left, tweeted on Friday that it was going to release an updated report on the embattled drug giant Valeant on Monday.
The tweet came during hedge fund manager Bill Ackman’s conference call defending his massive investment in Valeant.
“$VRXhas a better chance of going to 0 than$HLFever will,” Citron tweeted, adding that the storywas “dirtier than anyone has reported!!”
The $HLF in the tweet referred to Herbalife, whose stock Ackman is short – for almost three years he has been betting that its stock will go to $0.
Valeant’s stock was last trading down about 10% at $100.
Ackman’s Pershing Square Capital has lost more than $1.5 billion on paper this year on its Valeant bet. Much of those losses have happened in the past two weeks.
Citron’s report focuses on the company’s relationship with Philidor, a specialty pharmacy that distributes prescription drugs for Valeant.Valeant is the only supplier to Philidor, and it also has an option to buy the company. No one on Wall Street had really heard of Philidor until earlier this month.
Citron has accused Valeant of using Philidor to create “phantom sales” of its products.
Ackman said on his investor call that he did not think Valeant engaged in deceptive accounting.He did add that he thought “some of Philidor’s numbers are exaggerated.”
Valeant has categorically denied the allegations in the Citron report.The company hosted an all-hands call this past Monday to address the allegations.
On Friday morning, Valeant said it would sever “all ties” with Philidor.