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Concordia is on the Wrong Side of Pharma History

Disappointing earnings. Substantially lower guidance for 2016. A CFO departure. A suspended dividend. A drug-pricing controversy. Oh, and a libel suit against a chicken farmer.

All were features of Concordia International's unusually calamitous earnings report on Friday. For a day, at least, the Ontario-based specialty pharma firm one-upped its better-known progenitor Valeant, which has had a mixed week of its own.

Concordia's most troubling resemblance to Valeant is that it, too, has become a poster child for major trends in pharma. First, the FDA is approving generics at a much faster rate than it has in the past, as it works through a backlog of applications, increasing competition for the older drugs on which Concordia relies. Secondly, U.S. payers are aggressively clamping down on pricey drugs, including some of Concordia's.

These issues have hurt small firms and multi-billion-dollar giants alike. But for Concordia, which has racked up more than $3 billion in debt buying drugs that are often vulnerable to competition, it hurts a lot more. Concordia's shares were down 27...