New York (HedgeCo.net) – Back in May, there was an article featured in the HedgeCoVest newsletter that looked at where hedge funds were moving their money in the first quarter and the name of Valeant Pharmaceuticals (NYSE: VRX) was the “most added” stock in the first quarter according to S&P Capital IQ. Looking at the past article, there were $3.7 billion in buys and it was also the most sold stock with $1.36 billion in sells back in the first quarter.

Depending upon what those hedge funds have done with Valeant in recent months, some of them may have had a rough day on Monday. Valeant’s stock fell 16.5% in yesterday’s trading session after the House Oversight and Government Reform Committee sent a letter to the committee chairman asking him to issue a subpoena for Valeant’s documents related to price increases on drugs the company acquired.

According to a report from Business Insider, one of the largest shareholders in Valeant is none other than Bill Ackman’s Pershing Square. The report states that the fund owned just shy of 20 million shares in the company as of mid-March.

Over the last six trading days, the stock has fallen over 31%. If we use the number of shares held by Ackman from the Business Insider article and we do the math on where the stock closed on September 18 and where it closed yesterday, that would mean close to a $1.5 billion decline in value in six trading days. That is if Pershing Square still owns the same number of shares. The loss would be greater if they have increased their stake.

Rick Pendergraft
Research Analyst
HedgeCoVest