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By Michael Erman and Manas Mishra
May 8 (Reuters) - Valeant Pharmaceuticals International Inc said on Tuesday it will change its name to Bausch Health Companies Inc as it seeks to distance itself from a series of scandals and accounting issues under the drug company's previous management.
The company also reported better-than-expected first quarter earnings, and its shares rose 12 percent.
Chief Executive Joseph Papa has worked for the past two years to turn around the company's fortunes and regain investor confidence following a flurry of investigations into its accounting and pricing practices. One of his biggest challenges has been to cut the company's debt, which ballooned to nearly $30 billion because of an acquisition spree under former CEO Mike Pearson.
"I made the comment on the first day I joined that we should do a name change," Papa said in an interview. "We had to make some real progress first with some of the legacy issues that have been affecting our company - we think we have done that," he said, noting that Valeant has cut its debt by $6.9 billion and settled a significant portion of the lawsuits against the company.
Valeant will take on the new name in July and will trade under the ticker symbol "BHC" for both its NYSE and Toronto listings. The name change reflects the company's optical products business, Bausch and Lomb, which brought in sales of $1.10 billion in the first quarter and accounted for more than half of the company's total revenue.
According to Thomson Reuters I/B/E/S, the company earned 88 cents per share, excluding items, beating analysts' average estimate of 60 cents per share. Analysts said sales of the company's irritable bowel syndrome drug Xifaxan were better than expected.
Despite the better-than-expected results, Papa said the company still views 2018 as a "trough year," and is looking to new products the company is launching to drive growth going forward.
The company raised its full-year revenue forecast range to $8.15 billion–$8.35 billion from $8.10 billion–$8.30 billion, partly helped by the performance of Bausch and Lomb.
Net loss attributable to the company was $2.69 billion, or $7.68 per share, in the quarter ended March 31, compared with a profit of $628 million, or $1.79 per share, a year earlier.
Total revenues fell 5.4 percent to $1.96 billion.
Reporting by Manas Mishra in Bengaluru; Editing by Arun Koyyur and Nick Zieminski