Doubts over Valeant’s acquisitive model and a controversy over its relationship with a specialty pharmacy have done great damage to the market value of the drug maker.
Valeant will restate its 2014 as well as 2015 earnings and has yet to issue its audited financial report for 2015.
Bill Ackman an activist investor who has lost billions with the company, recently became a member of the board and creditors increased pressure. Several note holders have issued default notices, requiring that Valeant file its annual report. It said it would do so prior to April 29.
Papa will start his role in the early part of May, replacing Michael Pearson the current CEO who agreed to step down in March once the board found his replacement.
Papa, who is 60, will also be a board member at Valeant.
Valeant shares were up 1.6% Monday when the news was released of their high-profile new CEO eased some concerns of investors.
At close on Friday, the stock was down 86% from its August high.
The news was reported by international wire service Reuters and helped to push down Perrigo shares over 15%. On Monday, Perrigo replaced Papa with John Hendrickson who was President and as the same time reported preliminary earnings that were lowered that had been expected.
Valeant, based in Laval, Quebec, grew at a very quick pace embarking on a spree of acquisitions, gobbling up other pharmaceuticals and in a number of cases sharply increasing prices of their new products.
However, the company upset investors in 2015 as its strategy received a great deal of scrutiny from the public, politicians and regulators.
Pearson left on medical leave in December due to pneumonia and returned in late February.
Papa started in 2006 at Perrigo and was the president and COO previously at Watson Pharmaceuticals.
Papa will bring a great deal of experience selling healthcare products that are over the counter, which will help the Bausch and Lomb eye care and Valeant’s skincare lines.
He also has a strong background in the integrating of acquisitions and a big reputation for running ethical operations.