Costa Mesa-based Valeant Pharmaceuticals International was downgraded by Standard & Poor’s Ratings Services on Wednesday.
S & P; revised its outlook on the drug maker to “negative” from “stable.” The agency did affirm its corporate debt rating on Valeant, which is BB-negative.
The downgrade reflected Valeant’s recent setback in its development of Viramidine, a hepatitis C drug, as well as other business challenges. Viramidine has had some mixed results in earlier trials.
S & P; analyst Arthur Wong said in a statement that the rating “reflects the uncertainty relating to the company’s recently announced restructuring plan, challenges to drive earnings and cash flow growth, and setbacks in its R & D; pipeline.”
Valeant’s chief scientific officer and president of research and development, Dr. Kim Lamon, said earlier this year that he plans to to leave the company at the end of June.
The company hasn’t named replacements for the positions.
Wong did say that the negative factors were “somewhat offset by Valeant’s diverse product portfolio, significant on-hand cash, and limited debt maturities over the intermediate term.”
Shares of Valeant were off about 2.5% on Wednesday.
