UPDATE 1-Valeant shares gain 8 percent after it announces plans to restate

(adds share move)
Feb 23 (Reuters) - Shares of Valeant Pharmaceuticals (N:VRX)
International Inc VRX.N rose 8 percent on Tuesday, the morning
after the drugmaker said a board committee investigation into
its dealings with distributor Philidor Rx Services would result
in a profit restatement.
Valeant VRX.TO said based on the preliminary review, it
would restate results for 2014 and 2015 to reflect its findings
that some revenue should have been recognized at the time drugs
were dispensed to patients, not when they were delivered to
Philidor.
The company, based in Laval, Quebec, said it would release
unaudited earnings on Monday and hold a conference call.
Valeant shares, which were trading at $82.71 on Tuesday
morning, fell more than 19 percent on Friday and Monday after
Wells Fargo (N:WFC) initiated coverage with an "underperform" rating and
a valuation of $65 to $68 per share. Wells Fargo analyst David
Maris said on Tuesday in a follow-up note that the restatement
could unsettle investors.
Evercore ISI analyst Umer Raffat said investors were
expecting a big restatement after the Wall Street Journal on
Monday evening reported that the company was about to announce
an earnings restatement, based on unnamed sources. Valeant sent
out its own press release on Monday night.
"It ended up being fairly benign," Raffat said in an email.
One investor who asked for anonymity said that the fact that
the company finally set an earnings announcement date also was a
relief.
"People were imagining all sorts of stuff. There definitely
could have been worse reasons behind it," the investor said.
Valeant cut ties with Philidor Rx in October after it was
revealed that the distributor had used aggressive tactics to try
to increase insurer reimbursements, mostly for dermatology
drugs, to help the Valeant inflate revenue. Valeant also said it
would have an ad hoc committee investigate the arrangement in
which it had an option to buy the company and therefore was
consolidating its financial results.
The restatement will reduce its reported 2014 GAAP earnings
by about 10 cents per share and increase 2015 GAAP earnings by
about 9 cents per share, Valeant said.
"We view this as a marginal impact and certainly not one
that warranted the significant pressure late in the day and
after market yesterday," Stifel analyst Annabel Samimy wrote in
a client note.