Valeant (VRX) Plunges as CVS Health Terminates Philidor

Shares of Valeant Pharmaceuticals (VRX), which had been up more than 9% earlier today, plunged nearly 12% in recent after-hours trading on Thursday, as drugstore chain CVS Health Corp (CVS) said it has ended its agreement with specialty pharmacy Philidor, which has an exclusive partnership with Valeant.

“CVS/caremark maintains a broad national network of 68,000 pharmacies,” CVS Health Corp. said in a statement e-mailed to Bloomberg. “In accordance with CVS/caremark’s standard auditing protocols, over the last several weeks we have been monitoring and reviewing the results of recent audits of Philidor’s practices. Based on the findings from those activities, we have terminated Philidor for noncompliance with the terms of its provider agreement.”

Last week, Valeant’s stock collapsed on allegations by influential short-seller Citron Research saying the company was using specialty pharmacies to inflate revenue and avoid auditor scrutiny.

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