Mr. Phil Taylor of Export Development Canada reports

EDC PROVIDES VALEANT PHARMACEUTICALS WITH USD 67.5 M TO SUPPORT RECENT SALIX PHARMACEUTICALS ACQUISITION

Export Development Canada has previously disbursed $67.5-million (U.S.) in financing for Montreal's Valeant Pharmaceuticals International Inc.

The loan is part of a larger $1-billion (U.S.) term loan facility that Valeant is using to finance the repayment of certain outstanding indebtedness of Salix Pharmaceuticals Ltd., a leading gastrointestinal pharmaceutical company based in the United States. Salix was acquired by Valeant on April 1, 2015.

Valeant has used acquisitions like Salix to springboard itself into the upper echelon of Canada's pharmaceutical space. Valeant's strategy is to focus its business on core geographies and therapeutic classes that offer attractive growth opportunities while maintaining its lower selling, general and administrative cost model, and decentralized operating structure.

EDC's relationship with Valeant dates back to 2009, when EDC first provided a $50-million (U.S.) loan to Valeant's predecessor, Biovail Corp. Biovail was a Canadian pharmaceutical company that merged with Valeant, based in the United States in 2010, to create the Canadian industry leader that exists today.

Since the merger, EDC has provided Valeant with approximately $400-million (U.S.) in total financing support.

"Valeant's acquisition model really serves as the golden standard from a trade perspective," said Antonio Lopes, strategic account executive and lead-for-life sciences and health care, EDC. "More broadly, we really see the sector pushing forward as companies discover the benefits of investing in established intellectual property as a strong driver of earnings growth."

With companies of all sizes making foreign IP acquisitions, EDC has moved to facilitate this shift in business by offering cash flow financing. With this kind of financing, EDC evaluates a company's ability to repay a loan not by its existing assets, but instead by projecting its expected cash flow following the IP acquisition.

EDC has used this financing to help companies of all sizes expand their international presence in the health care and life sciences sector. In 2014 alone, EDC helped more than 140 companies in the sector conduct close to $550-million (Canadian) in new foreign business.

About EDC

EDC is Canada's trade finance agency, providing financing and insurance solutions locally and around the world to help Canadian companies of any size respond to international business opportunities. As a profitable Crown corporation that operates on commercial principles, EDC works together with private- and public-sector financial institutions to create greater capacity for Canadian companies to engage in trade and investment.