WASHINGTON — Facing the wrath of lawmakers on Capitol Hill Wednesday, a top Valeant Pharmaceuticals official said he would recommend significant price reductions for two heart drugs that Valeant had previously marked up.
Investor Bill Ackman, an influential Valeant board member, told the Senate Special Committee on Aging that he texted Valeant board chairman Robert Ingram during the hearing to suggest a conference call with the board this week to discuss cutting the prices of the drugs — Isuprel and Nitropress — by 30 percent.
That would match the 30 percent discount that Valeant said it has been offering hospitals that need the drugs — though senators on the committee, and a hospital official, said hospitals had not yet received the price break. Ackman said he would also recommend unspecific decreases for two other drugs that treat Wilson’s disease, Cuprimine and Syprine, which were focuses for the committee.
Ackman joined outgoing Valeant CEO Michael Pearson and former company executive Howard Schiller in expressing contrition for raising prices so steeply.
“It’s horrible. It’s wrong,” Ackman said.
Pearson, for his part, said in his opening statement that he and the company “made mistakes” and had been “too aggressive” in raising prices.
Ackman’s pledge to recommend price reductions was prompted by Senator Susan Collins of Maine, the committee’s chair, who asked him for examples of what specific actions the company would take to address public outrage.
Other senators piled on, too. Senator Thom Tillis of North Carolina asked the company to provide more information to put the 30 percent reduction in context. Senator Joe Donnelly of Indiana urged Ackman to discuss even deeper reductions.
“We will absolutely discuss it,” Ackman responded.
Collins later returned to the point, telling Ackman that a 30 percent price cut for the heart medications would still leave the price significantly higher than when Valeant acquired the drugs.
“You can expect from us within weeks and hopefully sooner a response to where we’re going to price these drugs and it will be significantly lower than where they’re priced now,” Ackman said. “We’re going to come up with an appropriate price, based on an appropriate rationale.”
Politicians trying to respond to public anxiety about drug costs have put a target on Valeant, along with Martin Shkreli, in recent months.
And they weren’t in a mood to make nice on Wednesday. As Missouri Senator Claire McCaskill put it: “Pigs get fed. Hogs get slaughtered. It’s time to slaughter some hogs.”
Pearson was nearly held in contempt of the Senate after initially refusing to be deposed. Hillary Clinton has called out the company by name on the campaign trail; one of her tweets was swiftly followed by a steep drop in Valeant’s stock value.
The company has been mired in twin controversies in recent months. First, part of its business model has been acquiring existing drugs and raising their prices. Second, its relationship with a specialty pharmacy has led to questions about the company’s accounting practices and prompted a federal probe.
Valeant has shaken things up, pushing out Schiller and Pearson and, as announced this week, hiring Joseph Papa as chief executive. But Wall Street seems skeptical about the company’s future. Valeant’s stock price has fallen from a high of more than $250 a share to less than $50.
Papa will get a pay package of $67 million this year, Bloomberg reported. That includes nearly $12 million in salary, bonus, and a special payout for leaving behind stock options at his former job. Most of the rest is in the form of stock options and restricted stock.