(MENAFN- AFP) Controversial Canadian drug maker Valeant Pharmaceuticals said Monday that chief executive Michael Pearson had been placed on medical leave after being hospitalized with severe pneumonia.
In his place, the company created an interim Office of the Chief Executive Officer staffed by three top officials, and a separate committee to oversee the new office.
Valeant shares sank 4.9 percent to $108.67 in opening trade Monday on the news.
The move came after Pearson was hospitalized last week with what the company described as "a severe case of pneumonia".
"Our thoughts are with Mike and his family," said Robert Ingram, a member of Valeant's board of directors.
"Out of respect, we will be honoring his family's request for privacy and will not be commenting further on his condition at this time."
The board named Valeant chief counsel Robert Chai-Onn, group chairman Ari Kellen, and chief financial officer Robert Rosiello to the interim CEO office.
"The Board of Directors has full confidence in Rob, Ari and Rob to preserve continuity of the Valeant operations and protect the long-term strength of the company while Mike is out," said Ingram in a statement.
"The committee will be working closely with the entire management team to ensure that the company continues to operate normally while Mike focuses on his health."
Pearson's illness came after the company has endured months of criticism and hits to its share price over its drug pricing and distribution policies.
While rejecting accusations that it engaged in deceptive practices, Valeant in October cut ties with mail-order pharmacy Philidor RX.
Their partnership had seen Philidor aggressively market Valeant's more expensive drugs over cheaper generics preferred by insurers, which caught the attention of US lawmakers and investigators now looking into its pricing.
Earlier this month, Valeant announced a drug distribution deal with pharmacy giant Walgreens that will lower prices of many medications by 10 percent in the United States.
The deal applies to Valeant's branded dermatology and ophthalmology prescription drugs, including the high-selling Jublia treatment for toe fungus.
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