In 2015, Valeant Pharmaceuticals was one of Wall Street’s hottest companies. By mastering the arts of corporate tax evasion, creative accounting, and illegal price-gouging, Valeant pumped its share price up to $275.
And then, people found out just how it made its money. A flood of lawsuits ensued. The company’s massive debt-load suddenly looked unsustainable — and its biggest investors ran to the exits.
Except for Bill Ackman. The billionaire hedge-fund manager — whose early success had earned him the nickname “Baby Buffet” — refused to cut bait. Instead, Ackman bet his reputation on his ability to turn Valeant around. He bought more shares and took two seats on the company’s board.
Alas, his efforts proved futile. On Monday, you could buy a share in Valeant for $12.11. And so, Ackman finally admitted defeat. His firm, Pershing Square Capital Management, sold its entire stake in Valeant, capping its losses on that investment at about $4 billion.