The former CFO at Valeant accused of 'improper conduct' is not going quietly

Howard Schiller, valeant cfo, valeant interim ceoGetty Images/ Mark WilsonWASHINGTON, DC – FEBRUARY 04: Howard Schiller, CEO of Valeant Pharmaceuticals, listens to questions during a House Oversight and Government Reform Committee hearing on Capitol Hill, February 4, 2016 in Washington, DC. Former Turing CEO Martin Shkreli invoked his 5th Amendment right not to testify to the committee that is examining the prescription drug market

Valeant on Monday said in a statement that the company’s former chief financial officer, Howard Schiller, had engaged in “improper conduct.”

Schiller disputes that characterization.

Valeant said Monday it had asked Schiller to resign from the board, but that he had not done so.

It also said:

The improper conduct of the company’s former Chief Financial Officer and former Corporate Controller, which resulted in the provision of incorrect information to the Committee and the company’s auditors, contributed to the misstatement of results.

Schiller said in a statement Monday through his lawyers that Valeant’s note contained “an incorrect statement,” saying “at no time did I engage in any improper conduct that relates to any restatement of revenue the Company is considering.”

Here is his full statement:

Valeant has 22,000 incredible employees and a collection of very strong franchises. While the challenges facing the Company are significant, I am confident that Valeant will prevail and emerge again as a very strong company.

As former CFO of the Company, I want to be very clear that the 8-K filed by the Company today, and the Company press release issued today, contain an incorrect statement. Contrary to the statement in the 8-K and press release,
at no time did I engage in any improper conduct that relates to any restatement of revenue the Company is considering. In addition, at no time did I ever provide any incorrect information to the Audit and Risk Committee
or the Company’s outside auditors regarding this accounting issue.

As a result of the fact that I did not engage in any improper conduct regarding this proposed restatement, I have respectfully declined the request from the Company’s Board to resign from the Board.

The Philidor sales transactions in Q4 2014, and the subsequent accounting treatment, was the result of a careful and reasoned accounting decision made by the Company’s Corporate Controller based on what she considered to be
complete and accurate facts, and I was told by the Corporate Controller that the outside auditors reviewed the transactions in question. The accounting decision was not my decision, but I was advised of the decision and the
rationale behind the decision by the Corporate Controller, and I agreed with the decision. The now-former Corporate Controller was incredibly experienced, she was trusted and respected by the Audit and Risk Committee, and she consistently received among the highest employee rankings inside the Company and strong support from the Company’s outside auditors.

My hope at this point is to see the Company recover from its challenges and for its employees and shareholders to once again prosper.

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