From the beginning, I had only one goal.
To bring down Ackman and gain fa through it.
But the kind of fa I sought was a bit unusual.
Even if the regulators and the governnt condemned , I wanted the public to stand by my side.
‘Because I’ll definitely need it later.’
Soday, the treatnt I develop will face controversy too.
If I secure this kind of fa in advance, public support itself would beco a shield that protects .
For that reason, the fight against Herbalife was a necessary war.
If I beco the savior of the retail investors here, I’ll gain an unwavering support base.
The preparations were complete.
Now, all I had to do was wait for the right timing.
‘It would be perfect to drop the bomb now.’
Ackman had thrown everything he had into the Herbalife front.
At this point, it looked like he was winning quite successfully…
But that only ant his capital had been pushed to the limit.
So, what would happen if a huge hole suddenly opened up in his portfolio?
In short, what if a massive sinkhole exploded in a place like Valeant, which was fighting a war through short selling… say, with a 90% stock price crash?
‘Leverage really is terrifying.’
Pfft.
A laugh escaped .
Starting from Valeant, I could clearly picture his entire portfolio crumbling like dominoes, eventually forcing him to liquidate even Herbalife.
‘Now that would be quite a spectacle.’
But that’s for later.
Right now, I had one task.
To ignite the fuse.
‘What matters is bringing this up as naturally as possible…’
Right now, all eyes in the market were fixed on Herbalife.
If I suddenly brought up Valeant here, it might seem out of context, like I was just trying to distract everyone.
So I was pondering how best to make my next move…
And just then, Ackman fired the first shot.
[I’ve warned you before. I spoke about the dangers of Ha Si-heon dragging civilians into a battlefield. The Herbalife situation was bound to end in the victory of hedge funds with superior capital and expertise.]
His words were sly.
As if I were the root of the entire crisis, he was trying to redirect public anger toward .
And that wasn’t all.
[Ha Si-heon’s investnt approach is completely detached from the intrinsic value of companies. Just like with Herbalife, he relied solely on ethics-based regulatory strategies in Valeant too. This kind of investnt is not only unlikely to succeed, but also extrely volatile.]
Ackman went a step further, even warning investors to distrust my strategy.
But.
Thanks to him, I got the perfect timing.
I imdiately prepared a presentation and began countering his attack one point at a ti.
“Claiming that Pareto Innovation’s investnt selections have nothing to do with value is simply false. Our fund makes decisions based on rigorous algorithm-driven data analysis. The sa goes for Valeant.”
Now it was ti to get to the point.
“As I ntioned at the beginning, Valeant’s growth formula didn’t fit our analysis model. It simply took ti to thoroughly verify. And now, the truth has co to light.”
I stared straight into the cara and declared:
“Valeant is a fraudulent company.”
***
Ha Si-heon’s exposé began like a gentle ripple.
[Until now, Valeant’s rapid growth has been attributed to ‘strategic acquisitions’ and ‘drug price hikes.’ But that’s not the truth.]
[Our investigation uncovered shocking facts. Valeant secretly owns several pharmacies and has been inflating sales figures illegally through them.]
Ha Si-heon began revealing concrete evidence one by one.
What especially caught his attention was a suspicious partner of Valeant—a mail-order pharmacy nad ‘Paladon.’
On the surface, it looked like an unrelated, independent pharmacy, but when we examined its transaction records, sothing felt off.
[The way revenue is recorded for this pharmacy is simply incomprehensible.]
Normally, revenue is generated only when custors pay for the dicine.
However, in Paladon’s case, revenue was recorded the mont Valeant delivered the drugs—even before they were sold to custors.
[Recording revenue before even selling to a custor is unprecedented. This is deliberate manipulation of the books. Valeant used these tactics to create the illusion of high revenue and rapid growth. That’s why it didn’t align with our algorithm’s growth pattern.]
Even up to this point, it was already a serious problem.
But this exposé was just the tip of the iceberg.
[Thinking Paladon rely manipulated sales figures would be a big mistake.]
After a brief pause to draw the audience’s attention, Ha Si-heon continued.
[This pharmacy used all kinds of unethical thods to boost Valeant’s drug sales. According to insider testimony, they deliberately steered patients away from cheap generics toward Valeant’s expensive alternatives.]
And it didn’t end there.
[Furthermore, there’s evidence they manipulated prescriptions to ensure Valeant’s drugs would be covered by insurance. When insurance companies initially rejected the claims, Paladon would keep resubmitting under different codes—again and again—until they got approval. They never stopped the manipulation until they succeeded.]
The internal docunts presented by Ha Si-heon revealed this fraudulent process in full detail.
It was even outlined in the manuals provided to Paladon’s employees.
[While the governnt is trying to reduce dical costs for the people, Valeant has been deliberately pushing patients toward more expensive drugs. Hiding behind the guise of a pharmacy, they’ve been tampering with prescriptions at will.]
This exposé quickly made headlines in major dia outlets.
Normally, such unbelievable revelations would’ve been t with skepticism.
But this ti was different.
Because the whistleblower was none other than Ha Si-heon—the man who exposed the Theranos scandal to the world.
His na now carried a weight that millions of people could not help but trust.
The public, upon hearing the news, was swept up in rage and shock.
– Prescription forgery? Running shadow pharmacies? Is this even possible?
– Buying pharmacies and forcing sales? ssing with patients’ lives—this is inhuman.
– So obsessed with profits they’re sucking the lifeblood from the sick… Is this a real company?
– Now we finally know why drug prices are so high.
Sensing the tide of public opinion turning against them, Valeant rushed to respond.
[These claims are baseless. Paladon is a completely independent company with no connection to Valeant. While we have a partnership, they operate autonomously. This is a coordinated attack by short-sellers aiming to profit from our stock’s decline.]
They tried to highlight the fact that Ha Si-heon was a short-seller in order to undermine his credibility.
Their argunt was that since Ha Si-heon had shorted as much as a billion dollars' worth of Valeant stock, he was spreading false or exaggerated rumors to drive the price down and reap massive profits.
However.
That was a common accusation short-sellers often faced…
But in Ha Si-heon’s case, it didn’t work.
– When it was the Theranos case, Ha Si-heon didn’t have any stake but still exposed it with his own money.
– Going head-to-head with the big sharks? That’s Orca level.
– The fact they’re trying so hard to pressure him… ans he must’ve hit the bullseye.
Ha Si-heon was fundantally different from other short-sellers.
He had the image of soone who fought not for money, but for the truth.
As public opinion began leaning overwhelmingly in Ha Si-heon’s favor, Valeant hurried to change its strategy and tried to distance itself.
[Paladon is an independent company, and as such, we are not aware of their internal operations. However, since the allegations presented are serious, we also promise a thorough investigation on our part…]
Valeant drew a clear line between themselves and Paladon.
Even if Ha Si-heon’s exposé turned out to be true, they insisted they had nothing to do with Paladon’s internal problems.
However, the market didn’t believe their explanation.
Valeant’s stock continued to plumt following Ha Si-heon’s revelation.
On the first day of the exposé, the stock had already plunged from $250 to $123, and it kept falling even after their failed attempt at damage control.
This was a catastrophic turn of events for Ackman, who held a massive 13% stake in Valeant.
He imdiately called the CEO of Valeant to demand an explanation.
However.
[The market is overreacting. Fraud? Co on, you know our internal workings better than anyone else.]
Ackman’s investnt firm, Maverick Investnt, was known for its strategy of focusing on just ten stocks.
Which ant every position was backed by ticulous analysis.
[What’s happening with Paladon is a partner company’s issue. It’s unrelated to us. Things will settle down with ti.]
Ackman agreed with the CEO.
He hadn’t found any issues in the reports he personally reviewed, so it seed more likely that this was just a temporary market misunderstanding.
If so…
They just had to wait, and things would eventually calm down.
However, the problem now wasn’t the facts.
His portfolio manager spoke urgently.
“We need to post an additional $2.2 billion in collateral imdiately!”
When Ackman strengthened his short position against Herbalife, he had brought in leverage.
As a result, all of his assets were now tied together as mutual collateral…
Which ant Valeant’s value drop had triggered a margin call.
The problem was—he didn’t have that much cash on hand.
To resolve this, he would have to liquidate other positions.
“Reduce our position in ALTM.”
“That won’t be enough! And if Valeant keeps dropping like this…”
If the collateral shortfall worsened, all of their positions could face forced liquidation.
In the worst-case scenario…
They might even have to give up Herbalife—the largest position in the portfolio.
However.
“If we start liquidating now, bit by bit…”
“They’ll catch on imdiately.”
Herbalife was a stock watched like a hawk by retail investors.
They wouldn’t miss even the smallest movent.
What’s more, Ackman’s short position in Herbalife was worth a whopping $2.5 billion.
Liquidating that position ant buying actual shares in the market to repay the borrowed ones.
But at that mont, 90% of the floating shares were held by retail investors.
If anyone realized that Ackman had to buy Herbalife shares in a situation like this…
It was a horrifying thought.
Most of all—would the retail investors even sell to Ackman?
If that happened…
“Then the price becos whatever they say it is.”
Ackman exhaled slowly and spoke.
“We must never let it co to that.”
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