WASHINGTON — A Senate committee said late Friday that it would start contempt proceedings against Valeant Pharmaceuticals chief executive Michael Pearson after he didn’t show up for a deposition in an ongoing investigation of drug price hikes.
The announcement by the Senate Aging Committee adds to the already substantial troubles the company has been facing ever since it raised the prices of two life-saving heart treatments last year by 525 percent and 212 percent, fueling public anger over skyrocketing drug prices.
Republican Senator Susan Collins of Maine, the chairwoman of the committee, and the top Democrat, Senator Claire McCaskill of Missouri, said in a joint statement that they are initiating contempt proceedings because Pearson was under subpoena to give a deposition on Friday and didn’t show up.
“His actions and those of Valeant are central to the investigation pursued by this committee. Therefore, it is our intent to initiate contempt proceedings against Mr. Pearson,” the senators said.
In a letter to the committee on Thursday, Pearson’s lawyer, Bruce Yannett of Debevoise & Plimpton, said he had “serious concerns” about requiring Pearson to give a deposition because the committee staff had not told him what topics they intended to cover.
“Mr. Pearson should not be expected to give sworn deposition testimony without a clear explanation of the subjects upon which he would be questioned and identification of which of the many thousands of documents he will be shown,” Yannett wrote. “While we are of course willing to work with the Committee to further its oversight interests, requiring Mr. Pearson to provide deposition testimony under these conditions would be fundamentally unfair and, we believe, unproductive.”
If the committee decides to move forward with contempt proceedings, it could become a lengthy process that could require action by the full Senate. Under one option, the Senate could vote to sue in federal court to enforce the subpoena, as it did last month to force a company to hand over documents to a different committee in another investigation.
Pearson recently returned as CEO after taking medical leave for a long illness. Last month, the company said it would replace him as chief executive, though he will remain in the role until a successor is named.
Valeant spokeswoman Laurie Little said Pearson will testify at the committee’s public hearing, scheduled for April 27, but doesn’t want to give private testimony as well.
“Valeant has cooperated with the committee’s inquiry since the beginning, including providing the committee with thousands of pages of documents. Mr. Pearson looks forward to testifying publicly at the committee’s hearing on April 27, but has informed the company and the committee that he does not intend to also appear for private testimony in advance of the hearing,” Little said. “We look forward to continuing to cooperate with the committee in its inquiry.”
For now, though, Collins spokeswoman Annie Clark said the committee will meet on Wednesday to consider holding Pearson in contempt. She said the committee “is considering all options,” adding that “this is a very unusual situation.”