Considering it costs $2.5 to $5 Billion from the initial Research phase to bringing a new drug to market, the $32 Billion in VRX Debt given their other assets, and proven drug portfolio makes this stock look cheap here on a valuation basis.
I bet I could find a buyer willing to pay $50 a share for Valeant Pharmaceuticals over the weekend if Bill Ackman wasn`t in such a hole on this stock, and needs a much higher price given the average stock price on his accumulated share stake.
Given that there is going to be further consolidation in this space, and the high costs associated with organically generating new drugs for the marketplace with no guarantees of success – VRX looks like an attractive take-out candidate to me. Their debt is actually in line with many utilities trading at much higher valuations with much lower revenue generation capabilities from both an overall margins and gross profit standpoint.
First published here: http://j.mp/28WNaAl