Short seller Jim Chanos on Tuesday said he is still short shares of Valeant Pharmaceuticals, and he's not about to close out his bet against the drug company anytime soon.
"We started shorting the stock in the low $100s, added to it in the $200s, choked on it at $290 but stayed short and added to the stock as recently as early this year," the Kynikos Associates founder told CNBC's "Fast Money Halftime Report" on the sidelines of the Delivering Alpha conference in New York.
Shares of Valeant are down nearly 88 percent over the last year to below $28, presenting an opportunity for Chanos to cash in.
Asked at what point he would cover his bet against the embattled Valeant, Chanos said the company is still facing about $37 billion in net debt and long-term liabilities.
"That's the real problem here. With the equity, this is something like a $47 billion, $48 billion total enterprise value. This is not a small company, and the shareholders have only a very small — and I think reduced — claim on those assets," he said.
Further, companies like Valeant that rely on acquiring drugs and raising prices will encounter a tough time in the current political environment. Valeant is facing several government probes into its business practices and accounting amid increasing scrutiny over drug price hikes.
Democrat presidential nominee Hillary Clinton, who is leading in most polls at present, has also made clear that she intends to take a hard line on drug pricing. Chanos said President Barack Obama's vow as a candidate to take rein in for-profit colleges, on which he followed through, shows that investors should take notice of Clinton's comments.
Valeant declined to comment.
Chanos, who is famous for shorting once high-flying companies like Enron, said he continues to believe Valeant bulls are not analyzing the stock's accounting correctly. During a Delivering Alpha panel before Chanos' appearance on "Fast Money: Halftime Report," mutual fund legend Bill Miller said Valeant is one of his top picks.