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The Gospel of Paulson

John Paulson
Bausch Health has $16 billion of debt, and investors are worried the company won’t be able to pay its debts as they become due, and might even file for bankruptcy. Photo: Spencer Platt/Getty Images
William D. Cohan
April 24, 2024

Allow us to recall the Valeant Pharmaceuticals roller coaster, a fable of a onetime Wall Street darling that fell to earth and cost our friend Bill Ackman $4 billion in losses. That massive haircut for Ackman at Valeant came soon after another $1 billion loss at Herbalife, a one-two punch that might have ended a lesser hedge fund manager. But Bill is nothing if not resilient, and he more than recovered from those losses, even finding time to focus on other topics—campus politics, libel law, etcetera—besides investing.

Since its (less than) glory days under Ackman’s watch last decade, Valeant has become two intertwined, publicly traded Canadian companies: Bausch Health, a pharmaceutical company; and Bausch & Lomb, the contact lens and eyewear company. Bausch Health, with a market value these days of around $3.1 billion, has 10 board members—one of whom is Brett Icahn, the son of Ackman nemesis Carl Icahn. The board chairman is John Paulson, the billionaire hedge fund manager who made a killing during the 2008 financial crisis by betting correctly that the market for mortgage-backed securities would collapse.