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Valeant in talks to hire Perrigo's Papa as CEO: Source

Joseph Papa, CEO of Valeant
CNBC
Joseph Papa, CEO of Valeant

Drugmaker Valeant Pharmaceuticals is seeking to appoint Perrigo boss Joseph Papa as its new chief executive, a source familiar with the matter said.

The Canadian drugmaker is negotiating a contract with the Perrigo CEO and it aims to announce his appointment as soon as next week, the source told Reuters.

However, Perrigo board has not said whether it would allow Papa to void a non-compete clause in his contract, the source said.

"We are aware of the speculation regarding our Chairman and CEO Joseph Papa," Perrigo said in a statement. "As is our company policy, we do not comment on speculation or market rumor." Valeant declined to comment on the "rumors."

The Wall Street Journal earlier reported that Valeant was looking to name Papa as next CEO.

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.

CNBC contributed to this report.

Reuters reported last week Valeant had brought in investment banks to review its options amid interest from buyout firms and other companies in its businesses.

Pearson and activist investor William Ackman, who joined Valeant's board last month, have said Valeant was considering selling non-core assets to help cut its $30 billion debt pile.