"People come up to Tim and ask, 'How the heck did you get R&D to do this?'" Wheeler says. "We were at GSK for 14 years and there was no way we'd have gotten R&D to do it. They'd say, 'R&D is an art. You can't put science against an art.' But we've been able to do it."

The results within R&D, according to Lamon, have been of two sorts: soft and practical. Setting and meeting benchmarks has created a motivated atmosphere throughout the department, one filled with camaraderie, not punitive competition. "I am not walking around with a whip," Lamon says, "but I see people trying to meet world records. We have a joke internally that that's what we're going to do from now on—just keep setting world records. That's the soft thing."

The more practical outcome that Lamon speaks of surfaced as the department was gearing up for its Phase III clinical trials for Viramidine. During planning stages, the R&D team had budgeted 12 to 18 months for the average enrollment time in the trials. "Historically, people hadn't been enrolled in less than 12 months," Lamon says. So R&D sent some of its trained green belts to investigator meetings to find out what typically disrupts study coordinators' ability to get things started.

Part of that was accelerating contract preparation, a process that can hold up enrollment significantly. Valeant went through a Lean Six Sigma process of looking at contract preparation, and noting and resolving any inefficiencies that existed.

In addition to saving time, finance chief Bailey notes the cost savings involved in making such a process more efficient. "That is money, because every time you go through a contract revision, it's another set of attorneys on both sides," he says. "It also ensures that you don't find yourself saying later on, 'Oh, I wish I had thought about putting that in.' You get a much better contract for both parties. And it's done faster."

Sure enough, Valeant's R&D team shaved five months off its previous world record for enrollment, getting the first study up and running in seven months. For the second study, they cut an additional 30 days.

Battle Ahead

Valeant's destiny lies mostly in the fate of Viramidine. The drug, expected to launch in 2007, is designed to replace ribavirin, which went generic in the United States in April 2004. Through a licensing deal that pre-dated the current management team, Valeant was receiving royalties from sales of Rebetol, Schering-Plough's brand name for ribavirin, which when combined with pegylated interferon, is the standard of care for hepatitis C.

Valeant, of course, needs to replace the $300 million it was receiving from Schering. But the company claims Viramidine is an improvement on ribavirin and will reduce toxicity. The product is a pro-drug; it does not become active until acted upon by enzymes in the liver. As a result, says the company, it is better targeted to the liver, where hepatitis C replicates, less toxic to red blood cells, and thus less likely to cause anemia.

"The most critical thing to our company right now is Viramidine," Tyson says. (Valeant has not publicly stated its projections for sales of the drug, but long-term goals suggest billion-dollar ambitions.) "It's a significant improvement for treatment of hepatitis and it will be an overall less costly treatment regimen for those paying for medicines. It is a huge financial opportunity for Valeant."