Valeant Pharmaceuticals names new CFO amid turmoil

Valeant Pharmaceuticals said Monday it has replaced its chief financial officer as the embattled drugmaker seeks a turnaround amid a firestorm over its past accounting practices, pricing and business deals.

Paul Herendeen, a drug industry veteran who most recently served as CFO of Pfizer spinoff Zoetis, Warner Chilcott and MedPointe, was appointed as CFO of Valeant.

He takes over for Robert Rosiello, who will stay on as executive vice president of corporate development and strategy.

The shake-up marks the latest move by Valeant CEO Joseph Papa, who joined the company in the spring.

"Paul is an accomplished and well-respected financial executive, and we are delighted to welcome him to Valeant," Papa said in a statement. "His prior experience as a public company CFO, strong operational focus and disciplined approach to financial management make him the ideal choice to lead our finance function as we execute on our plans to stabilize and transform the company."

Last week, Valeant announced that it had negotiated favorable changes to loan terms in a move that gives the company flexibility with its creditors. But the company was also hit last week with a lawsuit from mutual fund giant T. Rowe Price Group, which accused the company of running a "fraudulent scheme" that "destroyed billions of dollars in shareholder value."

Valeant and its officials allegedly used a secret pharmacy network, deceptive pricing and reimbursements and fictitious accounting to shield the company’s brand-name drugs from generic competitors and artificially inflate revenue and profits, T. Rowe Price charged in the lawsuit.

Valeant, which has said it plans to defend itself against the lawsuit, is facing multiple federal investigations.

Follow Paste BN reporter Nathan Bomey on Twitter @NathanBomey.