September 6, 2016 – Executive search firm Odgers Berndtson has placed Paul S. Herendeen as executive vice president of finance and chief financial officer of Valeant Pharmaceuticals International.
John Hawkins, vice chairman and director in Odgers Berndtson’s life sciences practice, led the assignment.
As Valeant CFO, Mr. Herendeen will oversee all of the company’s finance functions, including controllership, tax, and treasury, reporting directly to chief executive officer Joseph C. Papa.
“When we evaluated Paul Herendeen’s outstanding career experience, it represented an exquisite fit with the mandate,” said Mr. Hawkins. “He has an outstanding reputation, deep specialty pharma industry experience, deep experience in equity and debt capital markets, he knows the investor community that follows Valeant, he is a CPA, and a highly seasoned CFO with a proven track record of building value for healthcare investors.”
Mr. Herendeen has more than 30 years of broad financial experience and leadership. He served as EVP and CFO of Zoetis Inc. for two years. From 2005 to 2013 and from 1998 to 2001, he served as CFO at Warner Chilcott, a specialty pharmaceuticals company. He rejoined Warner Chilcott after four years as EVP and CFO of MedPointe, a privately held healthcare company, where he served as CFO from 2001 until 2005.
Prior to that, Mr. Herendeen spent nine years as a principal investor at both Dominion Income Management and Cornerstone Partners, where he worked on investments as well as mergers and acquisitions for the firms and their portfolio companies. He also spent the early part of his career in banking and public accounting, having held various positions with the investment banking group of Oppenheimer & Company, the capital markets group of Continental Bank Corporation, and as a senior auditor with Arthur Andersen & Company.
A Small Universe of Strong Candidates
“Paul is an accomplished and well respected financial executive, and we are delighted to welcome him to Valeant,” said Mr. Papa. “His prior experience as a public company CFO, strong operational focus and disciplined approach to financial management make him the ideal choice to lead our finance function as we execute on our plans to stabilize and transform the company. As we move forward, Paul and the other members of the executive management team will play vital roles in shaping the new Valeant.”
Mr. Herendeen said he was pleased to bring his experience and financial expertise to Valeant “at this important point in its transformation,” and “I look forward to working with the leadership team and my finance colleagues to contribute to the company’s future success.”
Valeant Pharmaceuticals is a multinational specialty pharmaceutical company that develops, manufactures and markets a broad range of pharmaceutical products primarily in the areas of dermatology, gastrointestinal disorders, eye health, neurology and branded generics.
“The requirement here that made this search rather unusual was the small universe of the strongest candidates – those who have experience within and understand the pharmaceuticals industry as well as the equity AND debt capital markets,” said Mr. Hawkins. “With Valeant being somewhat of an exception, few large pharmaceutical companies have relied on debt financing for their capital formation needs. Covenant compliance and fixed-charge coverage are generally areas where most pharmaceutical financial officers have comparatively less experience than FOs in other industries. Its a rather rare breed of pharma CFOs who have both.”
Mr. Hawkins said that Odgers Berndtson’s specialized knowledge of both the specialty pharmaceuticals industry and of professionals who are relevant in the financial community at large (pharma CFOs, investment bankers, big four partners, sell and buy side equity analysts) was essential to the completion of this assignment, which he said was completed from start to finish in just 58 days.
A History of Working Together
Valeant turned to Odgers Berndtson in finding Mr. Papa this past April. Mr. Hawkins led that assignment as well. Mr. Papa came to Valeant from Perrigo Company plc, a global healthcare supplier of over-the-counter and prescription pharmaceuticals, where he served as chairman and CEO.
According to Steve Potter, managing partner, U.S. operations, for Odgers Berndtson: “Valeant was looking for an executive who was a strategic thinker and proven bottom line financial manager.” He also said the company at this stage in its life cycle needed “someone whose personal track record would enable the company to rebuild its brand and trust among internal and external stakeholders.” In Mr. Papa, Valeant seemed to get all three, plus one additional key trait, according to Mr. Potter: “His ability to recruit and retain leadership teams across the enterprise.”
In addition to conducting the company’s CEO search, Odgers Berndtson also assisted Valeant in rounding out its board by placing five company directors. “The five new non-executive directors bring, by design, a wide range of skills, experience and perspective to the board, adding to and complementing the experience of the other six sitting directors,” said Mr. Hawkins, who led the searches. “Collectively, these new directors bring fresh perspective, outstanding reputations, proven judgment, wisdom, and experience focused in areas where the company’s shareholders sought expertise.”
Contributed by Dale M. Zupsansky, Managing Editor, Hunt Scanlon Media