How’s the Wind Blowing? With crises, you never know. Three examples. Earlier in the month we reported former Wall St darling Valeant was in the dumps ( PRN, Apr 4), due in part to a press release that said 2016 earnings would be $6.6 billion and a CFO who told investors a few hours later the figure would be $6 billion ( PRN, Mar 21). Shares in the Canadian pharma was down 90% since August, CEO Michael Pearson was out and it was seeking breathing room from creditors to avoid default. But two weeks ago creditors budged, giving Valeant hope. Shares responded, rising 36% for the week, closing late April 7 at $35.51. Even better, an internal probe related to the botched press release and other things found nothing alarming. Some analysts were saying the company, which also came under investigation from the SEC and Congress for precipitous drug price increases, could see shares rise to $65. Not bad, but still a long way from their August 5 value of $262.52. The past week was less ebullient. Early in the week The Wall St Journal reported a major creditor, Cen
terbridge Partners LP, called a default resulting from Valeant’s failure to file its annual report. Valeant returned serve, saying it will file the report April 29, avoiding default. Thursday night Reuters ran unconfirmed reports that Valeant has retained investment banks including Goldman Sachs to assess its options, a sign the drug maker will unload assets to reduce its $30 billion debt load. Valeant refused to comment on that story. – Theranos, another troubled company in the health sector and also a former Wall St darling that has been nearly silent for months, took another hit. A negative report from the Centers for Medicare and Medicaid Services (CMS) about Theranos’ testing products ( PRN, April 4) has regulators mulling sanctions against the blood-testing company and founder/CEO Elizabeth Holmes, which would ban her from owning or operating a lab for two years. On the upside, Theranos broke its silence. Spokesperson Brooke Buchanan, in an interview with CNBC, denied Holmes is banned from the lab industry and said Theranos is working with CMS to address issues raised. – It was an up-and-down week for embattled Chipotle. Shareholder CtW Investment Group blasted the burrito maker’s board, saying members’ long service slowed turnover that could diversify the all-white group. It urged shareholders to reject the re-election of Patrick Flynn (18 years on the board) and its only female, Darlene Friedman (21 years). Later in the week JP Morgan analyst John Ivanko Thursday upgraded Chipotle. The brand is “highly meaningful” and will regain customer trust with time, Ivanko said, although he admitted its E. coli incidents cost it three years of earnings growth.
News Bits: Interesting combination last week as security and investigation firm Beau Dietl & Associates joined PR firm JConnelly to launch PI|PR, to “protect companies and individuals facing threats to their businesses, reputations, and bottom lines.” – Now here’s an appealing benefit. Earlier this year MWWPR unveiled an unlimited paid time off (PTO) policy for all its full-time employees. And there’s no catch, MWWPR’s group VP Emily Graham and account coordinator Rebecca Vignali tell us. The move should benefit millennials, whose brief tenure equated to limited PTO, forcing many to use days off on personal matters like doctor appointments. “With unlimited PTO, we can take vacation without worrying about rationing time for other commitments,” the 2 millennials say. – Twitter appointed Kathy Chen managing director for Greater China. Although Twitter is blocked in China, it’s been trying to get Chinese companies to buy advertising. – Transparency, sort of. In addition to paying a $5.1 billion settlement, Goldman Sachs agreed to a list of facts the Dept of Justice composed stating the investment bank misled investors and failed to do due diligence during the 2007 financial crisis. – On the eve of Equal Pay Day, Hill+Knowlton Strategies unveiled 3 initiatives to ensure it pays men and women equally. – Big Data’s contribution is “the value that can be created to improve performance, and better understand competitors, consumers, employees, media and other publics,” Institute for Public Relationssays in Irreversible, a new report. “Uncovering insights of Big Data requires a human element and critical thinking to create meaning,” it adds.
People: Grayling named former BlackBerry global communications head Adam Emery EVP and head of the agency’s national technology practice. – Lisa Martins joined Finn Partners as VP in the agency’s health practice. Prior to joining Finn Partners, Martins was VP at Ogilvy and a senior director at Burson-Marsteller. – Kudos to Rick Gould of Gould+Partners on the May publication of his 5th PR book, Doing It The Right Way: 13 Crucial Steps For A Successful PR Agency Merger or Acquisition. Gould donates all book proceeds to kids’ charities.