Cramer: Valeant should be up if new CEO reports are true

Shares of Valeant Pharmaceuticals gained nearly 8 percent Friday, a spike justified if reports about the company poaching Perrigo's Joseph Papa are true, CNBC's Jim Cramer said.

"If it's Joe Papa from Perrigo, then this stock deserves to be trading up," Cramer said on "Squawk on the Street." "This is a guy who is a stable-stable guy."

"He steered that Perrigo ship into doing some remarkable things. He knows the generic [drug] business." he said.

The Wall Street Journal reported Thursday that Valeant had reached a deal with Papa, Perrigo's CEO, to become its new chief executive. Reuters later reported, citing a source familiar with the matter.

Valeant declined to comment and Perrigo has not responded to a comment request.

Valeant said in March CEO Michael Pearson was leaving the company, just three weeks after returning from a two-month medical leave. The company said at that time Pearson would remain in his post until it finds his successor.

Debt-laden Valeant has recently settled with some of its lenders after a missed deadline for filing its annual report put the company at risk of a default. It secured an extension until May 31 but has pledged to file its statements toward the end of April.

Shares of Perrigo were down 5.7 percent.

— Reuters contributed to this report.