Valeant Pharmaceuticals International (VRX) continues to be in news. On Wednesday, the stock dropped more than 6% even as the company announced that it has initiated the process to secure an amendment and waiver to its credit facility. The amendment will allow VRX to extend the deadline to file its 10-K to May 31 (from April 29) and its Q1 10-Q to July 31 (from June 14).

The amendment will provide VRX some much needed breathing space. While VRX has sufficient liquidity, there have been concerns about a potential default. But my major concern right now with VRX is whether the company’s new business model sustainable. I continue to remain on the sidelines with VRX and see it as a value trap.