WEBVTT - Bloomberg Law Brief: Day Reckoning For Valeant Execs (Audio)

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<v Speaker 1>Well, now it's time for our daily Bloomberg labrief, exploring

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<v Speaker 1>legal issues in the news, and today Bloomberg Lajos doom

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<v Speaker 1>Grosso and Greg Store discussed the arrest of former Valiant

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<v Speaker 1>Pharmaceuticals executives Gary Tanner and Andrew Davenport. The men ran Philidor,

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<v Speaker 1>a Rex Services, and are charged with fraud and money laundering.

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<v Speaker 1>They speak with the Bloomberg Intelligence analysts Elizabeth Krewta Hollow

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<v Speaker 1>and Bloomberg Biotech reporter Donnie Bloomfield. Elizabeth, prosecutors have been

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<v Speaker 1>investigating this scheme for more than a year and is

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<v Speaker 1>a little complicated. Will you explain what allegedly happened? And

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<v Speaker 1>we know that Tanner, part of Valiant, conspired with Davenport

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<v Speaker 1>to create phil Door and it's also that other Valiant

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<v Speaker 1>emloys were implicated in this process of creating Philidor, so

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<v Speaker 1>that we need to figure out who those others really are.

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<v Speaker 1>That's not entirely clear from these documents that we got.

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<v Speaker 1>So they create Philidor, and then Tanner then works with

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<v Speaker 1>Davenport to push Valiance products through this mail order pharmacy Philidor,

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<v Speaker 1>and they conspired to get Valiant only use Philidor. They

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<v Speaker 1>claimed that there were other rivals that were eventually going

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<v Speaker 1>to compete and convinced Valiant out right by philidor Or.

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<v Speaker 1>It's quite complicated, but the option to buy Philidor for

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<v Speaker 1>zero dollars, which is in essence owning them, and then

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<v Speaker 1>Davenport got forty million dollars and kicked back ten of

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<v Speaker 1>that too. Tanner, We're gonna have to keep saying this,

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<v Speaker 1>but this, of course is all just alleged in the complaint, Uh, Donny,

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<v Speaker 1>As I understand this, the company is sort of being

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<v Speaker 1>made in these charges out to be the victim of

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<v Speaker 1>the alleged conduct by Tanner and Davenport. Is that how

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<v Speaker 1>you understand it? Yeah, I think that's right in these charges,

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<v Speaker 1>but we need to think about this in the broader

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<v Speaker 1>scheme of things. As we know, the investigation is ongoing.

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<v Speaker 1>The former CEO mc pearson and former CFO Howard Schiller

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<v Speaker 1>weren't charged, but charges could still becoming. We don't quite

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<v Speaker 1>know yet. I think the point is that Valiant is

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<v Speaker 1>certainly not clearly to the woods yet, even though they

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<v Speaker 1>were the victim here. I think there are a number

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<v Speaker 1>of unanswered questions, including why was it so easy to

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<v Speaker 1>defray them in this particular way allegedly, and so we're

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<v Speaker 1>just going to have to see what unspools out of

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<v Speaker 1>this investigation which could bring bring the company under under

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<v Speaker 1>question other ways, as Bloomberg Intelligence analyst Elizabeth krew to

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<v Speaker 1>Hollow and Bloomberg Biotech reporter Donnie Bloomfield speaking with Bloomberg

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<v Speaker 1>Stom Grosso and Greg Sture. You can listen to Bloomberg

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<v Speaker 1>Law weekdays at one pm Wall Street Time here on

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<v Speaker 1>Bloomberg Radio.