The world has started to realize that traditional pharmaceutical companies are not quite as boring as was once thought. Sure, they aren’t as sexy and cool as new tech and car companies are, but they have found a way to make major headlines in the past few years.

The problem is, a good amount of that coverage is overwhelmingly negative.

Of course the pharma industry is no stranger to controversy. Even politicians are steering clear of discussion on drug pricing and the woefully excessive markups of lifesaving medicines.

Drugs that could be healing people across the world are sold at an eye watering margin that make them too expensive for people in countries that need them most. But companies in this industry have justified this excess by saying that the profits were being used to cover the research and development of new drugs.

That theory is still up for debate, but Canada-based Valeant Pharmaceuticals decided it wanted to distance itself from that conversation. The company did this by cutting R&D spend and, instead, focusing on acquisitions, but it would soon become clear that not everything was on the up and up…

The Rise

Valeant was originally founded in the United States in 2008 and was run by Michael Pearson, who worked as a consultant at McKinsey & Company for more than two decades. He wanted to bring a new way of thinking to the industry, and decided to start by moving the company headquarters to Canada and going on an acquisition spree over the next few years.

The company eventually grew sales by taking over other businesses instead of investing in research to develop its own. This meant they now owned household brands like contact lens kings Bausch & Lomb, as well as a host of much needed drugs developed by other companies.

Pearson’s aggressive pursuit of growth seemed like it was paying off. Sales grew rapidly over the years and despite some skeptics suggesting the business model had limits, hedge funds continued to pump money into the company at breakneck speed. In fact, Valeant’s stock went from hovering around $8 a share in 2008 (when Pearson took over) to more than $257 in 2015. The company was a hedge fund darling with what seemed to be a very rosy future.