Mr. Pearson will stay on as chief executive until a replacement is appointed. Just weeks ago, Mr. Pearson returned to the company from a medical leave, which began in December. The company said he had been hospitalized with severe pneumonia.  “I am confident that the company will be able to rebuild its reputation and thrive under new leadership,” Robert Ingram, the board chairman, said in a statement.  Valeant also announced more information about the proposed restatement of past earnings and placed some of the blame for those issues on “improper conduct” by its former chief financial officer, Mr. Schiller, who also served as interim chief executive this year when Mr. Pearson was on medical leave.  The company said it had asked Mr. Schiller to resign from the board; Mr. Schiller has declined to do so. The company’s former corporate controller has also been placed on administrative leave, the company said.  “The improper conduct of the company’s former chief financial officer and former corporate controller, which resulted in the provision of incorrect information to the committee and the company’s auditors, contributed to the misstatement of results,” the company said in its news release. It was referring to an ad hoc committee set up by the board of directors to examine Valeant’s relationship with Philidor.  Mr. Schiller, in a statement issued Monday by the law firm Winston & Strawn, said that he had declined to resign because he had done nothing wrong.  “At no time did I engage in any improper conduct that relates to any restatement of revenue the company is considering,” he said, also denying that he had given the board or auditors incorrect information.  Valeant had previously estimated that $58 million in sales of drugs through Philidor should not have been recognized in the second half of 2014. Those sales were booked when Valeant sold the drugs to Philidor, as a drug company would do in selling to an unrelated wholesaler or pharmacy.  In December 2014, Valeant paid $100 million for an option that would allow it to acquire Philidor for no additional payment. At that point, it switched to booking the revenue only when Philidor sold the drugs to patients, as a company would do for a consolidated subsidiary.  But evidence has emerged that the relationship between Valeant and Philidor was extremely close even before the option agreement was signed, suggesting that sales should not have booked when the drugs went to Philidor.  In Monday’s announcement, the company reaffirmed the $58 million figure but gave some new figures for the impact on earnings. It also suggested that managers might have accelerated sales of drugs to Philidor right before the option deal closed, hoping for a quick increase in sales and earnings. Some of the sales “were not executed in the normal course of business and included actions taken by the company in contemplation of the option agreement,” the company said in a filing with the Securities and Exchange Commission on Monday.  The language suggests that this was “a sneaky move to book a lot of revenue right away,” said Erik Gordon, a business professor at the University of Michigan.  Some of the profits from the sales that are being taken out of 2014 will be added to 2015, when Philidor sold the drugs to patients. But the company also said some of the sales were booked twice — in late 2014, when the drugs were sold to Philidor, and then in early 2015, when some of those same drugs were sold to customers.  In the end, the company said Monday, some of the problems were the result of the tone set by Mr. Pearson.  “The company has determined that the tone at the top of the organization and the performance-based environment at the company, where challenging targets were set and achieving those targets was a key performance expectation, may have been contribution factors resulting in the company’s improper revenue recognition,” it said.  The changes will put more of a focus on Mr. Ackman, who owns 9 percent of the company. As early as last week, he stood by his investment, even when shares sank more than 50 percent in a day.  His bet has cost him more than a billion dollars in losses, at least on paper. He noted last week that Pershing’s vice chairman had recently joined Valeant’s board and said Pershing would take “a much more proactive role at the company to protect and maximize the value of our investment.”
The pharmaceutical company, whose shares have been pummeled in a series of struggles, also said it would restate some of its earnings.