Citron Research Says It Will Not 'Dial Back Warnings' Regarding Valeant

• Shares of Valeant Pharmaceuticals Intl Inc VRX were higher by 6 percent late Monday morning.
• Notable short-seller Citron Research said that it will not "dial back warnings" on Valeant.
• Citron said that it also "stands by" its Enron analogy and that Valeant has created a "network of undisclosed entities in order to alter financial results."

Shares of Valeant Pharmaceuticals are still lower by more than 45 percent over the past month, as investors and traders continue reacting to ongoing headline concerns regarding allegations of wrongdoings.

One of the most vocal sources of headline risk is Citron Research. The research firm said on Monday that it will not "dial back" its warnings on Valeant.

Citron initially released a research report which brought attention to Valeant's "drastic price hikes" of its drugs and the "unsustainability" of its business model. At the same time, Senator (and Democratic candidate) Bernie Sanders called for further investigation into Valeant.

Related Link: Goldman Downgrades Valeant, Sees 'Long Road' For Controversial Stock

Citron Research has published a new report that discussed the "myth" of Valeant's organic growth and its relationship with Philidor, a specialty pharmacy.

"Just two weeks ago, nobody in the investment community had ever heard of Philidor," Citron said in its latest report. "Then the bomb hit. 10 days ago, we uncovered the court document and the online privacy statements that decisively connect Valeant, Philidor, Isolani and R&P (plus West Wilshire and Orbit Pharmacies) in a web of purposeful and intentional corporate non-disclosure."

Citron's report continued: The court document stated that Valeant was either the perpetrator of a victim of a "massive fraud". After that filing, nearly 30 days had gone by with zero response from Valeant. To Citron, this was legitimately Enron-esque: The creation of a network of undisclosed entities in order to alter financial results, purposefully kept out of sight, and outside the scope of disclosure to the investing public.

With that said, Citron noted that it will not be releasing new allegations against Valeant. The report noted that it is passing all information to mainstream media investigative reports. The firm also cited its desire not to be "judge, jury, and executioner of the company's deeds."

Bottom line, Citron suggested that shares of Valeant will "trade at much lower levels than its current price" and that the stock is "toxic until many issues are flushed out."

Citron's Andrew Left was to appear on CNBC in the 12 p.m. ET hour.