Joseph Papa leaves Perrigo to become Valeant CEO

Joseph Papa is to leave over-the-counter firm Perrigo and replace Michael Pearson as CEO of embattled Valeant next month.

Canada's Valeant said Papa is expected to join by early May, after being CEO of Perrigo since 2006, where he was also chairman.

Papa leaves Ireland-based Perrigo after successfully fending off a hostile takeover bid from Mylan late last year.

He also oversaw the acquisition of Elan in 2013, a deal that saw Perrigo gain access to a royalty from Biogen's multiple sclerosis drug Tysabri (natalizumab).

Papa joins at a time when Valeant has become embroiled in the controversy over drug pricing in the US, and is having to restate financial results because of accounting issues.

However Papa, who will also become chairman, seems to be a good fit to take over the highly acquisitive Valeant, with his track record with M&A at Perrigo and more than three decades of experience in pharma and healthcare.

Valeant's shares ticked up almost 2.5% to around $36.84 on the New York Stock Exchange following the news. Perrigo's shares fell more than 13% to $105.39 on the NYSE in trading after the news broke.

Earlier this month Pearson was subpoenaed by a Senate committee investigating Valeant's pricing strategy after failing to appear for a hearing. He had returned to the company in February, after two months' medical leave after being treated for pneumonia.

The accounting issues, which involve drugs received by distributor Philidore being accounted for in 2014, instead of 2015, have meant the firm must restate accounts in both years and has delayed publication of its annual report.

The game of musical chairs at the top of the two companies was completed after Perrigo promoted John Hendrickson from president to CEO.

Related articles:

Valeant faces possible default

Valeant says CEO subpoenaed by Senate after no-show