The Securities and Exchange Commission is probing Valeant Pharmaceuticals International Inc. and activist investor Bill Ackman’s Pershing Square Capital Management LP to determine if there has been a breach of insider trading laws in their hostile bid for Irvine-based Allergan Inc., according to reports.

Dow Jones News Service reported today that the SEC inquiry was a civil one and is in an early stage.

Allergan sued Valeant and Pershing Square at the beginning of August on allegations of insider trading.

Pershing Square said in a statement that it “welcomed the SEC’s review of the facts,” and Valeant added in a release that it was “confident that the trading was completely lawful, as our reply to Allergan’s frivolous lawsuit will make clear.”

Valeant shares were up 2% to a market value of $37.1 billion.

Allergan shares were up 1% to a market value of $46.3 billion.