Valeant in new distribution deal with Walgreens
NEW YORK - Valeant Pharmaceuticals (VRX) has a new distribution deal with Walgreens (WBA), sending shares of the beleaguered Canadian drug company up sharply before the opening bell.
The company said Tuesday that the agreement will help to lower the prices of its branded prescription-based dermatological and ophthalmological products by 10 percent. The reduced pricing will apply to the wholesale list prices of the products and be phased in over the next six to nine months. The deal also covers over-the-counter products made by Valeant Pharmaceuticals International Inc.
The deal will allow consumers to get Valeant's dermatology and ophthalmology products -- including Luzu and Zylet --at a lower out-of-pocket cost from more than 8,000 Walgreens U.S. retail pharmacy locations and participating independent retailers. Walgreens is the nation's largest drugstore chain.
The 20-year deal takes effect early next year.
Patient advocates, doctors and Congressional leaders have attacked Valeant and other drug companies like Turing Pharmaceuticals for aggressively increasing prices on some prescription drugs. Critics say the companies have exploited a system lacking in competition to hike prices for critically needed medicines.
Valeant, in particular, has taken criticism for its practice of buying smaller drug developers, hiking drug prices and then slashing spending on research into new drugs.
Federal prosecutors have subpoenaed documents tied to Valeant's drug pricing and other practices ahead of a presidential election in which the soaring price of prescription medicines has become a top political issue
Quebec-based Valeant has said that it sells hundreds of prescription and non-prescription drug, and broad conclusions about its pricing should not be drawn "from any one drug or set of drugs."
U.S.-traded shares of the drugmaker jumped 12.7 percent, or $11.96, to $106.10 about 20 minutes before the market opened on Tuesday. The stock had soared past $260 to a new all-time high price as recently as August, but Valeant shares have largely plummeted since then.