Allergan, the maker of Botox and Juvederm, is holding its own in Valeant Pharmaceuticals’ hostile $53 billion takeover. In an effort to dissuade shareholders from selling to Valeant, Allergan contends Valeant has an unsustainable business model and has proven itself to be a poor supervisor of the companies it acquires.

In a complaint filed with the Security and Exchange Committee (SEC) in the United States and Canada, Valeant Pharmaceuticals alleges Allergan was making false statements about its business to drive down its stocks, while Allergan’s top shareholder, Capital Research and Management Company, dumped its shares.

Valeant is upset because they claim Allergan stated, “Valeant continues to cherry pick data that fails to provide analysts and investors with the financial information necessary to truly evaluate Bausch & Lomb’s performance. Valeant’s latest attempt to hide the ball appears to involve focusing investors on growth from medical device products rather than on pharmaceutical products that continue to stagnate or decline.”

The complaint is aimed at the latter part of the statement, “…pharmaceutical products that continue to stagnate or decline”, as Valeant claims Allergan was informed Bausch & Lomb’s sales had improved by 12 percent over the previous year.

Bank of Montreal Capital Markets analysts say, “As for news today that Valeant has complained to regulators regarding alleged statements about parts of Valeant’s business, we believe it will have no impact on Allergan’s defense as these types of complaints often occur from hostile bidders.”

Thwarting Valent’s takeover plans further, Allergan’s sales rose by 16 percent (to $1.8 billion) on Monday, July 22. In an effort to streamline, Allergan’s plans to cut about 13 percent of its workforce, 1,500 jobs, which resulted in a 2 percent stock increase for the company.
Should Valeant succeed in the takeover they would become the largest company in all of Canada.