U.S. House Democrats to seek testimony from Valeant in coming weeks

By Sarah N. Lynch
WASHINGTON, Dec 16 (Reuters) - Democrats on a U.S. House of
Representatives panel are planning to call Valeant
Pharmaceuticals VRX.TO Chief Executive Michael Pearson (L:PSON) to
testify in early 2016 about steep price hikes for some of the
company's drugs, a Democratic aide said.
The hearing before the House Oversight Committee could be
held as early as late January as part of an ongoing probe into
skyrocketing drug prices, a Republican committee aide said.
The Republican majority sets the agenda for the committee
and gets to decide which witnesses to call, but the Democratic
minority is typically allowed to select at least one witness of
their choice.
On Tuesday, Republican Chairman Jason Chaffetz and other
lawmakers sent the FDA a letter inquiring about the process for
reviewing generic drugs as part of the ongoing investigation.
The letter specifically references the biotechnology firm
KaloBios, which was recently acquired by Turing CEO Martin
Shkreli.
A Republican committee aide told Reuters that the panel has
been talking to a number of pharmaceutical companies as part of
the probe, but Republicans have not yet decided which they will
summon to testify.
Valeant and Turing Pharmaceuticals have been under mounting
U.S. government scrutiny over their practice of acquiring
off-patent drugs and drastically hiking the prices.
Last week, the U.S. Senate Special Committee on Aging kicked
off a series of hearings designed to investigate the causes
behind drastic drug price increases.
The panel's chairwoman, Republican Senator Susan Collins,
expects to call both Pearson and Shkreli to testify at a hearing
in 2016.
Valeant is under the microscope not only for its drug prices
but also for its previously close ties to Philidor, a specialty
pharmacy with aggressive billing tactics.
The company's shares have lost nearly 75 percent of their
value after it disclosed it had received subpoenas from federal
prosecutors.
Valeant recently hired Covington & Burling attorney Robert
Kelner to manage the congressional inquiries, as well as a
crisis public relations firm.
Turing is under investigation for possible antitrust
violations by the New York Attorney General.
In addition, federal prosecutors and securities regulators
are also probing Shkreli's relationship with pharmaceutical
company Retrophin RTRX.O , which he used to head, and hedge
funds he managed, according to Retrophin's corporate filings.
Maryland Congressman Elijiah Cummings, the ranking Democrat
on the House Oversight panel, has been among the most vocal
critics of Valeant and Turing's pricing practices.
He has repeatedly asked Valeant to turn over documents to
the committee and to make some of the company's employees
available for interviews to discuss Valeant's business
relationship with Philidor.
In a Dec. 15 letter from Cummings to Pearson seen by
Reuters, Cummings complained that the company has failed to turn
over all of the information requested.
"Your refusal to provide any documents or witnesses is
obstructing this congressional investigation and preventing a
full understanding of your company's suspect actions," Cummings
wrote.
Cummings said he wants the company to produce records and
interviews by Jan. 8.
A Valeant spokeswoman said the company disagrees with many
of his statements, and that it has provided information to the
committee and will cooperate.
A Turing spokesperson did not have any immediate comment.