New York (Hedgeco.net) – After standing by his investment in Valeant Pharmaceuticals (NYSE: VRX) as it fell over 70% from early August through mid-November, Bill Ackman and his fund Pershing Square sold part of their stake in the company in order to create a tax loss to help offset gains from some of its other investments.

Pershing Square divulged the selling in a filing with the SEC on Thursday. According to the report, the firm sold over five million shares and that move lowered its stake in Valeant from 9.9 percent to 8.5 percent.

Valeant has been maligned for their business strategy of buying other pharmaceutical companies and raising the prices of the drugs manufactured by the company. After the uproar created when it was revealed that Martin Shkreli and his company Turing Pharmaceuticals had raised the price of a vital AIDS drug by over 5,000%, the entire pharmaceutical industry was put under the spotlight for their pricing practices. Valeant has received multiple subpoenas from federal prosecutors concerning their drug-pricing policies.

Even as the company came under fire over the summer, Ackman steadfastly stood by the company and he even increased his holdings at one point. Apparently the tax loss created by the plunge was too tempting.

Rick Pendergraft
Research Analyst
HedgeCoVest