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As had been widely rumored, drugmaker Perrigo ( PRGO ) lost its CEO to Valeant Pharmaceuticals ( VRX ) Monday and also reported preliminary Q1 earnings and guidance that missed expectations. Perrigo stock plummeted in early trading, while Valeant stock rose modestly. Valeant said Perrigo CEO Joseph Papa will take the helm as both chairman and chief executive in early May, replacing Robert Ingram in the former role and J. Michael Pearson in the latter. Anonymous sources had leaked Papa’s appointment to the press late last week, although it was still unclear at the time whether Perrigo would let him out of his contract. “(Papa) has a strong shareholder orientation, a background in science and an unmatched track record of accomplishments, highlighted by his ability to lead companies through times of transition and drive excellence across commercial, manufacturing and R&D platforms,” Ingram said in a statement. “In addition, fostering an ethical culture and creating opportunities for professional development have always been high priorities for Joe, and we look forward to Joe’s arrival at Valeant.” Valeant rose 1.4% to 36.45 in afternoon trading on the stock market today . Perrigo tumbled 15.2% to 102.93, hitting a three-year low. Just how much is Perrigo hurting, as Valeant takes its CEO? Get an idea on IBD Stock Checkup. Perrigo, meanwhile, named its president John Hendrickson as its new CEO, “aligned with our succession planning process,” according to Chairman Laurie Brlas. The company also said that Q1 sales were around $1.33 billion to $1.35 billion, missing analysts’ consensus of $1.4 billion, according to Thomson Reuters. Earnings were $1.71 to $1.77 a share, while Wall Street had expected $1.89. Perrigo also cut more than a dollar off its full-year EPS guidance, now $8.20 to $8.60. “The majority of this change in guidance provided on Feb. 18 is the result of a reduction in pricing expectations in our Rx segment due to industry and competitive pressures in the sector,” Perrigo said in a statement. “The remainder of the reduction is primarily due to weaker-than-expected performance within the BCH (branded consumer health care) segment for the next three quarters and lower expectations for consolidated new product launches.” Perrigo also said that it was assessing a possible impairment charge associated with the BCH business, which was formed when Perrigo acquired Omega Pharma last year. It said it will be prepared to report the extent of the charge when it issues its official Q1 report on May 12. Scalper1 News
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