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Valeant beat expectations in 3Q thanks to U.S. skin business

J. Michael Pearson, Chairman of the board and Chief Executive Officer of Valeant Pharmaceuticals International Inc., waits for the start of their annual general meeting in Laval, QuebecJ. Michael Pearson, Chairman of the board and Chief Executive Officer of Valeant Pharmaceuticals International Inc., waits for the start of their annual general meeting in Laval, Quebec
How much of that option premium will Pearson ever see again?Photograph by Christinne Muschi — Reuters

Valeant Pharmaceuticals International Inc (VRX), which is under fire for massive price hikes of its two heart drugs, reported a better-than-expected quarterly profit, boosted mainly by strong performance in its U.S. dermatology business.

Net income attributable to the company fell to $49.5 million, or 14 cents a share, for the third quarter ended Sept. 30, from $275.4 million, or 81c a share, a year earlier. Revenue rose an organic 13%, while new acquisition Salix Pharmaceuticals contributed another $461 million in the quarter, bolstering the group’s top line by over 16%.

Revenue rose to $2.79 billion from $2.06 billion a year earlier, topping analysts’ expectation of $2.78 billion. Sales from U.S. dermatology business rose 53% to $465.5 million.

As a result, the Canadian drugmaker raised its full-year guidance to around $11.77 a share, from $11.65 previously, as it upped its revenue forecast to around $11.1 billion from an earlier $10.9 billion.

Valeant said last week it had been subpoenaed by U.S. prosecutors, seeking details on its drug pricing and distribution practices. However, the company said volume growth of 8.2% contributed to overall revenue than price factors (4.4%).