>> yeah. >> so sort of a cap there and then if it goes down it won't and then the economy -- i don't know, like the reverse temper. >> be careful what you wish for. >> mike. really appreciate it, thank you so much. that does it for us on "closing bell." thanks as well. a little more content for you from san francisco but i'm coming back and i'll see everybody tomorrow. "fast money" begins right now >> sav travels. "fast money" does start right now. live from the nasdaq market site overlooking new york city's times square imember is a lee. our traders, peter najarian, karen finerman, dan nathan and guy adami. tonight valeant shares down 50% today and the man who called the decline in the stock is here. we'll tell us where the stock is heading to now and the other name that could soon follow suit in a rare and exclusive interview and oracle beating on earnings and the stock is higher in the after hours. the call just getting under way right now. we'll hear on the quarter and a look at what oracle results could mean for the rally in

tech. later, if this man is president, what could it mean for your portfolio? a top strategist will tell you which names to buy and which will sell off as a result of a trump presidency, but, first, we start with the markets. moments of truth. we're less than 24 hours away from what could be one of the most dangerous days of the year for stocks ahead of tomorrow's all-important fed meeting decision. as an investor what's the first thing you need to do tomorrow, guy? >> an interesting day. no question about it. tomorrow shapes up for an interesting day. today's sales revision gives the fed some cover not to do anything but some numbers give them every reason to hike rates as well. i have no clue what's going to happen, but what i do know is the corner that they have painted themselves in gets smaller and smaller. i think bronze rally. we talked about 2025, the s&p, the potential to trade up to and it did. the bulls, the last two days it's been pretty encouraging. two days in a row where oil went down and two days in a row where

the oil volatility index went down and two days in a row where the s&p actually hang in there pretty well so we'll see? >> i'm looking at the volatility index, not just the ovx but the vix and dan and i go back and forth on all this all the time. it's a must-own. you need protection right now. we have no idea what the fed's metrix are. used to know and don't really know and whether they raise or not, probably not, but then does that put april on the table? does that mean they are going to do it in june? when is the next hike. we expected one, maybe two this year but when is that going to happen? will it be all the way out to june any think the way i'll position myself, however, is still look at the same quality of the companies that we love. see what oracle is doing in the after market and see what microsoft has been doing the last couple of trading sessions. i know, this morning, as a matter of fact, we even had lyon cooper [ all talking at once ] ing about a position of microsoft getting in there. many. tech names were sold off that were an opportunity going for. >> almost a damned if you do and

if you don't scenario where there might be credibility problems and there's concerns that the economy is weaker than we think it is and if they are they are hawkish and the markets get scared because there's more rates to come than what had been priced into the market so far. >> i think they have room to maneuver meaning do nothing. i think they are allowed to punt here. there's a lot that they can point to, point to the ecb and they can point to the markets being somewhat volatile and i think that's fine. i don't think they lose credibility. do i think though if the economy heats up more in today's retail sales were counter to that, then the next time they will be under a little bit more of a gun. i really think they can do anything. >> are you glad you have puts going into this meeting? >> guys talking about the relatively calm and the s&p in front of the may nounsment and to me you're damned and damned if you don't.

the fed fund futures are only pricing about a 25% chance to raise in april and people are suggesting that really june is the time that it's going to go. if they push up the expectations to april, the markets, you get clarity but i don't think the market is going to like it a whole lot and what were the problems caused over the last year and a half it was really about the end of qe, the earned of zerp and rise of the dollar and collapse of commodity prices and started to sacred its get uneasy a little bit. when i looked at the markets, i didn't care what the s&p was doing, hyg, the high yield. saw it down a percent almost and saw the iwm, the russell 2000, small cap stocks down 11.5% and i saw crude down again so to me those are the very things that got the market really jittery in january and february so the fed really has to thread a needle here so to get things right and i do see a retracement of a bit of move over the last month. >> which stocks or sectors do you look to for the most action off the back of the fed's decision? >> financials. the first place have you to look

based on what the fed says is absolutely financials. seemingly the most interest rate sensitive group out there. utilities being the other side of that coin, but you have to look right to the financials which have not traded a couple of days notwithstanding, haven't tradeled particularly great. >> well, i would say, however, but if you look at jpmorgan, when jamie bought it at 53 here it is closer towards 60. you look at city and bank of america, seen a lot of paper coming into bank of america including this morning and yesterday so it seems to me that people are sort of preparing to be involved in some of these financials expecting to see a move to the upside. i'm not seeing all kinds of put activity, a lot of people getting bearish on the banks. i love what i'm seeing right now because i expect it to be a very bullish day tomorrow. >> get some news and janet yellen indicates she's plodding along more rate hikes to come. how does it make you feel about the economy and about what you own? >> i think it's good. for the banks it would certainly be good. >> sure. >> because they seem to rally. i'll save their position for --

for a move with earnings higher, but i think she wouldn't say that unless the economy is better so sensitive -- economic sensitive names for people like you or i, that would be good. >> look at the date in china, it's still bad. when you look at what the ecb and the boj didn't do this week, speaking to the fact that the global economy is not -- >> isn't our economy okay? >> you can talk about decoupling an that was the emerging trade in markets in europe, that was our little financial crisis. the financial crisis exploded and it's still going on at this moment. >> you're saying no matter what the fed does you're going to be negative on u.s. stocks? >> shocking. >> i'm telling you the fed has to do things really, really well here. if they get too hawkish too quickly. it runs the same risk that caused market participants to get panicked in january and february all over again, especially after we've had a low

volume 10% rally in the last month. >> all right. it's been a rocky ride this year for the market but the man who called the recent surge in stocks didn't let the volatility derail his thesis. take a look what he said when things were the darkest. >> i think investors are really gloomy, but i think what i'm really struggling with is thinking about the markets, are these going to be conditions as we exit 20616 and it's obviously dejecting and i don't think it changed the thesis for the years. >> tom lee is back and he's as bullish as ever. to be honest, when we spoke to you at that time i was concerned about your well-being busy seemed really depressed. >> i had a bucket next to me. >> at this point does it make you to feel even more constructive seeing the bounce back that we've had since february 11? >> yes. i mean, a lot of good things have happened in the last few

weeks. i mean, high yield is now positive for the year and it's a leading indicator for stocks. i think we have a graphic that shows that in the year following a negative high end yield and the fact that we turn positive mean that's in place and the second is the psychology is terrible and if you and i think clients are even worse off and even now, there's a feeling that there's a huge high water bark in the market and everyone is defensively positions and any good news could really cause a squeeze, a meltup. >> what are the sectors that you need to participate this year in order to be more convicted in your bullish call. we haven't had participation in the financials when you take a look at year to date or health care. >> i think health care is a leader becoming a lagard. outperformed for six consecutive years so it's time for it to take a break.

financials, the credits have done better than the stocks and i think the fears of negative rates on margins is overblown and i think financials will work later this year and the real play is two macros. correlated dollar, trade and dollar and the second is credit conditions are easing so you want to buy low caught. >> tom, how do you think about the dollar. just mentioned it here. a lot of people say it's done and stopped going up and for all intents and purposes it really consolidated in a tight range over the last year and comparisons will get easier for u.s. corporations and what are the conditions that would cause the dollar and kind of contrary to consensus thinking right now to actually break out and we know that it started to happen once the fed stopped printing money. >> yeah. it's a good question. i would just say in almost every meeting we do everyone is

looking for the policy to be with relative gdp growth. i would say that's already positioned. i think we have to have the move, every double digit gain has done sol dated half of that mood. down ten from the peak would be the norm and that's what we get this year and as you mentioned that's huge for business. i would say a lot of businesses saw weekly sales turn in mid-february and that's when the dollar went year over year. >> thanks for coming by. >> still bullish. >> steadfast on his view and the other things you have to watch. the transports, the iyt, i think in order for it to be bullish needs to get out of the bear trend. and that will get you to 140 and the iwm, the russell is still in this upper end of a range and that has to close above 110. >> up next, one small investment bank with one very big warning

to the world. a name that just posted its worst quarter since the financial crisis and when it could mean for the entire sector and a strategist who says a donald trump presidency could send stocks lower by 50% in the next four years. the man behind that call and valeant shares losing 50% of its values today. the short seller called for the decline on the stock back in october is here and he'll tell us where he sees valeant heading back to next and the other name that could soon follow soon. promises to be explosive. much more f-fun right after this.

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♪ yeah, you'll just have to miss it! ♪ ♪ we can't let you download... uh, no thanks. i have x1 from xfinity so... don't fall for directv. xfinity lets you download your shows from anywhere. i used to like that song. kicking off our top trades, jeffries group the worst quarter since the financial crisis. trading revenue plunged 82% and fixed income revenue dropped off a cliff. is jeffries a tell on some other big banks, guy? >> no question. other banks will feel the same pressures that jeffries field and look at likedia, trading at a seven or eight--year low. the argument for financials in this environment is this,

valuation. are they cheap enough and a lot of people would say yes, the other side is the yield curve going to work in its favor. i still think rates go down which give head winds and the ways in which these guys and gals make month and jeffries in a lot of ways is indicative of what's going on in the room right now >> i think the mix for jeffries is more problematic. much bigger lending back and advisory firms like a green hill. a much more difficult environment. m & a is important as well. the banks aren't trading like revenues won't be trading. >> ipos are nonexistent, so i

think that's swh priced in. >> all right. as we head to break here. take a look at shares of oracle and hires on the earnings beat. hear from safra katz and more on the company's outlook and what it means for the broader tech rally. i'm mel somewhat lee and you're watching "fast money" first in business worldwide and meantime here what else is coming up on fast. >> and we're going to have a big, big, big, a lot of fun. >> not if you own stocks. a top strategist says trump is doing three things if trump is elected president. he'll tell what you they are. and the man who called the collapse in valeant said there's another stock that could suffer a similar fate. >> that's not true. >> that's impossible. >> it's not only possible. it's probable, and that short seller will be here to reveal it when "fast money" returns.

>> steve: welcome back for "fast mone money". a number of states up for grabs tonight in the race for the white house and eamon javers is in florida up for grabs tonight and has all the important details. >> reporter: hi, melissa. not too far away from mara lago,

donald trump's fancy estate. this is trump carry and we expect trump will carry the state of florida given what we've seen in the poll numbers going in. got to wait until the voters make their choice. the stereotypical donald trump voter is an angry blue collar voter and we've spoken to angry white collar voters and retirees here today. here's a few that we met. >> i'm a clinton person so that's where i'm going to be. she's the only one that i've heard policy from, real actual policy. >> she is corrupt. she's a pathological liar. >> i think trump will carry all of florida healthily tomorrow. i think without a question he'll be -- he'll win the primary down here. >> i would have preferred if bloomberg ran or joe biden, even joe biden ran. warren buffett. bill gates and you can't always get what you want.

>> you can't always get what you want, melissa, and i did meet a bernie sanders voter, and as we say this is expected to be a donald trump country and is holding a press conference and we'll see whether that's a big victory party. >> back to you. >> eamon thank you, in palm beach for us. according to our next guest a trump president could be catastrophic for stokes and he joins us with us now. let's put politics aside. we're just talking about the notion on the street that seems to be fairly prevalent that a trump presidency could hurt stocks. what you're calgary for though is very dramatic and drastic. a 50% decline over his presidency which would be four years. and let's get back through the back of the envelope here. how do you get there? >> the way i get there, first, let's talk about what the issues are as far as the economic woes that he's trying to fix and

let's just say that he gets all the things that he says he's going to get done for his campaign and what he's sort of platformed on and you're basically talking about cutting taxes across the board, especially the higher income bracket and the corporate tax while at the same time maintaining all your entitlement spending and making the military strong and mixing our third world infrastructure. so we're going to lose $1 million in tax revenue if he does this and without any cut in spending it's probably going to require 8% to 9% gdp growth just to make this neutral. the second thing that's important is the mass deportations. >> it's going to cost the country to do that. >> it will cost the country a significant amount of money to do that, and if you assume every people that leave and every american in the country takes it, which is probably not likely

and they do, they will be higher wage jobs and they will cut into corporate margins and at the end of the day it will result in higher prices in consumers for walmart and go to buy things. >> quickly on tariffs. >> the third thing on tariffs is very simple. a 45% tariff on china, all it is is a tax on the u.s. consumer. you'll pay more when you go to walmart and more when you go to buy anything and at the end of the day, you know, you're basically look at a situation where everybody in the united states is going to be at a deficit and ask obama what happened when he tried to put a tariff on chinese tires. we saved $100 and wound up spending an extra 12 billion on tires >> bottom line, ian, let's say it looks increasingly clear trump will be the nominee, perhaps in the lead even in the polls for the presidency to take it all at the end of the day. what do you tell your clients? who you actually tell your clients to sell stocks? >> absolutely.

>> i think the multiple can compress gradually and that's how you get to the much lower s&p target. >> a controversial call, 1,000 on the s&p 500 an 11 times mull pal. anybody agree? >> well, it's awfully bearish. >> it is. >> one of the things we always have to keep in mind is when the politicians are giving all the promises how many of them are ever kept? >> right. >> i think that's part of it, and will donald start to move more towards the center if he indeed continues to grow and get himself in position to actually be the republican, so i sort of go to that side of things and i think he'll actually start to build a group around him and have some political background so i don't think it's dwight as bearish. >> i think they both move towards the center, hillary and trump, and i agree. it's so hard to get things done. all those policies sound terrible i.wouldn't sell my portfolio. >> no. the risk is he's gotten to where he is today politically because of all the uncertainty and i think that's the sort of thing that people would not be able to

price. i don't think there's a great chance that he'll actually be the president of the united states and i think he's frankly a political terrorist and when you think with all the uncertainty he's caused right now about the environment that we're in, i think 1,000 points on the s&p, that may be something -- >> but is he more -- is he more uncertainty than bernie sanders, for instance? that's a possibility. >> bernie doesn't really have a chance, okay, and, you know, to me -- >> we'll see after tonight, i guess. >> it's not very likely. i just think that -- i think, you know, all the reasons that that gentleman from web bush gave us, there's probably other reasons why people won't want to do business in america and speaking these incendiary sort of messages to people who don't understand things. yes, a tariff on chinese goods is a tax on his base. >> we've had the former chairman of ubs said down 20% on a trump presidency on a trump presidency and another said trump would be negative for stocks. politics aside, if you love the

guy, hate the guy, for stocks, trump good or bad? >> if he gets elect the the knee jerk could be done and other things that would be positive and nobody talks about that he's talked about from time to time. the fact that he might actually allow the repatriation of the $6 trillion, $7 trillion that's floating around there. if he were to somehow get that through, that would be unbelievably bullish, i think, both for the economy and for the stock markety so although the knee jerk of him getting elected is down 20% to 40%, when people wake up and realize the he's not going to do all the things he says he's going to do and do things that are actually constructive maybe it would actually be a positive thing. >> do you think a trump presidency would be good or bad for stocks? you can cast your vote in our twitter poll. that's at twitter.com/cnbcfastmoney. come up next the short seller who sounded the alarm on valeant's plunge back in october. he's back. his shocking take on where he sees the stock heading and the other name that will suffer

the same fate. much more "fast money" on this very, very busy night. vo: know you have a dedicated

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here's what's coming up, one stock has had a tough run and it could be in for major trouble. check out shares of oracle moving after hour. more on what the ceo is expecting for the quarter. first we start off of the day and that's valeant pharmaceuticals losing half of its value. meg terrell with more. >> reporter: if can only be described as real. early august the stock was trading above 260 a share and then the martin shkreli brings the pricing into conversation and valeant starts to plunge and then valeant is compared with

enron. valeant bull bill ackman holds a multi-hour conference call. mid-december. valeant strikes a more positive tone and issuing 2016 guidance. a week later the ceo falls ill and takes a medical leave of absence. two months later recovered from severe pneumonia and the company with draws of 2016 guidance and delays its fourth quarter earnings report and ackman again defends valeant saying it would help resolve uncertainty and would hope over the next few weeks and yesterday there was more support for pears on attributing the decline to negative reactions. >> the media is looking for a new crisis, it's kind of filling the space. we're just, as we do here.

we put our head down and try to make sure the company is better when we leave it. >> of course, that was an interview with our kelly evans on "closing bell" and today in pearson's first public appearance since his illness further bad news. the company issued 2016 guidance below expectations and is still unclear when it will final its 10k and now several federal inquiries and the $30 billion in debt still on its plate valeant still has a long way to go to regain investor confidence, and it didn't keep the pain to itself today. other special companies are also sinking in sympathy, mel. back to you. >> all right, thank you, meg. the short seller who called the decline in valeant back in october is here with us now. the executive editor of citron research joins us and great to have you again. >> nice to see you. >> what's next for valeant at this point.

>> file the 10k and get their house in order and find out how to move on and forget about the stock price and work on internal controls that are of most importance to them. >> that sounds like mike pearson's to-do list and when do you think actually happens. >> it was more of an unwind of the whole platform strategy and how valeant goes about repairing their business. don't forget that $51.30 that you see there is after the company and in reality how are you going to make them more valuable without having to raise prices. that's obviously going to help you. >> do you think that's high at this point? >> the market is looking?

>> is it tempting to even do so now. it sounds like it could be at risk of defaulting. >> no, i'm not tempted right now to buy it. at the end of the day valeant is a black box and people woke up this morning and saw the earnings report and during the day when analysts went to their fund manager and said what ex t exactly do we know and when you don't know what you own it's probably time to sell and there's no reason for me. have to put my capital in somethi something. >> stocks that also felt the sting in the aftermath of what happened with valeant.

you've called to it. do you think that this is the next one? >> i think, as i said before, they make valeant look like choir boys. >> so you think it's worse? >> i think it's worse because they are dependant on one drug, close to let's say 50% of their ebitda and depends on what metric you want to look at, dependant on one particular drug, not the 30 the valeant has that has no critical testing that's the real poster child for price gouging. >> that's one thing if you stat down to hillary and trump they would both agree how terrible that is for the system. >> the stock is already down 53% in the past year and the implication is the stock has much further to fall. do have a shorter position in

mallinckrodt and do you think the same downward spinal? >> no reasons it's any different than valeant. i'm sure they will come out and say we're different but that's the old story. if anything, they are much worse and right now their lead drug is akhtar. it's $36,000 a vial. they will do a little over $1 is billion and if that billion just goes to $400 million then mallin crodt could go to zero. a complete unwind of the platform strategy, exactly what we're seeing now with valeant. >> the ceo of "midday call-in"crodt has called into our control room and would like to respond directly to your comments. do you want to stay here and take his questions directly or say good-bye? >> would i like to if i can have a 30-second comment when he's done. >> let's bring in mark trudeau, the ceo of mallinckrodt and what

andrew has said is that your stock is going to zero. how would you like to respond or what would you like to say to andrew? >> thanks for giving me the opportunity to set the record straight. you know, the marketplace certainly pulled down valeant today and i want to be clear that mallin ckrodt is not valeant. we're a well diverse company, transparent with strength and to highlight a couple of facts. delivered a very strong quarter in fiscal 2016 which built on the momentum we saw in the fourth quarter and those sales were up 20%. we had strong volume across our specialty brands portfolio and earnings per share was up 17% and it represents less than a third of our business and is growing at 8% per year. we have a solid balance sheet and very strong cash flow and we actually raised earnings per share guidance for the year, so we've been delivering

consistently and exciting shareholder expectations. we have a very strong solid business model, well diversified with excellent brands that we're investing in this driving value across the board. >> andrew, i encourage you guys to talk to each other. you're on the exact opposite ends here in terms of what you're seeing for the company. andrew, go ahead. >> first of all -- >> you could take that exact response and take the world "midday call-in"ckrodt out and put the word valeant in. i'm sure 12 months ago pearson would have used the same phrases. because akhtar is a third of their business, what percentage of business is it, need to figure what percentage of earnings is it. most importantly is this. you have a franchise drug that's $36,000 a vial, that is your business. that you've not had critical testing on, a proper double blind clinical test to get to synthetic against the current

care. not once have they done there and instead of taking the time and calling into cnbc ant sit with the scientists and do proper studies and data so americans can stop overpay for your drug that you milk and milk out of the system. >> mark, a response? >> one. things that we've done since we've acquired akhtar and really all of the products that we have in our portfolio, we acquire products and we invest in them. that means investing in clinical and health economic data and in fact we just reported that we had over two dozen presentations. over two-thirds were actually for akhtar so we have consistently invested in this and this is a product that's considered standard of care for patients with very al terrencetive and we've updated akhtar's label in 2010. we have clinical data that

supports in our key indications. the fact that they have demonstrated superiority to the other options that are available including steroids, for example. been used by tens of thousands of patients and prescribed by thousands of spaces and in many cases it's the only alternatives for patients who have tried and failed with other therapies. >> very unusual for a ceo to call in to respond to a short seller. why do you fell compelled to talk to do that and do you feel the narrative is being hijacked by folks like andrew? >> certainly we don't control the share price and what we can control is the actual delivery of the value to system and investments that we make in our product and delivering on our revenue and earnings ber share

which we've done consistently as demonstrated by our most recent performance. there's been a lot of confusion about our business model. we're not in any way similar to valeant. we've been exceptionally transparent and tried to describe very clearly how we're taking products and investing in them to create more value for the health care system and to create more data and to deliver for our share holders as well as the patients that we serve. >> andrew, you've done your work so what do you say to mark? >> i think it's ludicrous. it's one thing if he's a short seller, the "new york times," pro publica. there's been journalism outfits that have gone ahead and exposed the real working of akhtar and what mark trudeau does not tell you is how he sells those drugs and those presentations. i wish he would answer how many dinner at maggiano and olive garden are you doing this month to solicit people to spend

$36,000 for this drug. he's come on cnbc right now to say he's not a platform company. when all wall street notion he's a platform company so what am i supposed to say? >> ask your question to mark. >> ask the most burning question in your mind to mark right now. >> the question is does he even know how his product is sold? how many dinners at maggianos and olive garden and applebee ease is he providing this month to sell to multiple sclerosis stations? >> let me just emphasize the fact that i've actually sat with patients very recently. we've had patients come and speak to employees who are on the drug who were suffering from devastating conditions and in fact their therapy and their disease responded exceptionally well to it the drug. i've actually sat across the

table and had dialogue with patients whose lives are improved and the other point i want to make is that it's a well diversified company and we have multifall brand products and this is a company that's consistently delivering on our strategy and consistently delivering on our share perspective and very committed to investing in our products to aid sideline shans and appropriately prescribe our products whether it's axar or our hospital portfolio or any other things that we do. i've been in this business for 30 years and developing and working with patients and creating products that make a difference in people's lives and no difference what we've been doing with mallinckrodt.

we want to create data that aids physicians on how to use the prescriptions to benefit their patients. >> it does sound like how one would describe valeant. what are the differences here when outsiders take a look at this as this and your company, what usually comes preceding, that heavy, m & a, research and development, is that accurate? >> completery inacthe. in fact we've been very transparent and we're consistent in articulating our strategy

we're exceeding expectations top and bottom line. this is not close to what vaillant does. we run a very traditional business model and it's based on a team doing pharmaceuticals like myself and very classic model that's a way to create value for both patients and shareholders, dramatically different than when valeant does. >> so he walks like a duck, sounds like a duck but he's a car. what i said holds true. he's diversified and not as diversified as valeant and it's not a problem until it's a problem. making sure that this is used the proper way that it's used

and using the synthetic version of akhtar and, yes, it may not be a problem today. it wasn't a problem in july. when it's a problem it will be too late and you'll see exactly what we see today with valeant. >> i would imagine with the decline in your stock price your ir department fields plenty of calls that expression concerns and how do they answer investors at this point? the decline in your shares is undeniable. there's something happening whether it's real or a manifestcation of concerns. how do you take back that narrative if what you say is true? >> we don't control our share price. >> you can control the narrative surrounding your stock price and that's why i'm here on f-fun to describe in detail what the mallinckrodt model to invest product is all about.

we have been and continues to drive top and bottom right greater than hair shoulder expectations. we were also very clear hon what we were going to do when we bought akhtar a year and a half ago. we were going to create more for veterans and payers and subscribers. we've also -- we've also said at the time and continue to say that we're focusing on payers to appropriate appropriately appropriate is and our long-term objective is to have the majority of covered lives under contract and in fact we've been making very consistent progress against that and i've reported that we have now approximately a third of covered lives in a relatively short amount of time that have

been under contracts. we've been very actively engaging with payers in a very transparent way to describe the appropriate positioning and use for the drug in the health care environment. >> mark, last question for you. you've explained your business model well and this business model has come under fire not only by short sellers who saw what happened with valeant and also political figures. if you had to increase r & d which according to my calculations according to your balance sheet was 5% of sales in 2015. if you had to increase that number and were limited in terms of the number of acquisitions that you can make in order to expand your pipeline is then your business model broken? >> not at all. in fact, we've most recently reported that our r & d as a percent of sales is 7%. >> 7%, okay. >> keep in mind that a third of our business is generic and all of our r & d is focused on the branded side of it so if you take the r & d spend as the

proportion of branded sales it's much closer to 10%. the second thing is we have very strong cash flow that we've been reporting on that every single quarter, and, in fact, what we do is we've been able to allocate capital effectively and to pay down debt as well as to return cash to share holders in the form of cash buyback and we're in a very enviable position to be able to use that strong cash flow. >> we'll leave it there. appreciate both of your participati participation. reaction? >> that's as good as it gets. the ceo was measured and i think he explained it as well as he could explain it. i thought your questions were great and your points were great. i don't know enough about the business. i will say this though. the people out there suffering from ms, they are the ones that

really get hurt in all of this if these drugs go away. i'm not trying to get up on my horse. that is a drug that's helping a lot of people right now. >> the one thing that stood out for me is the lack of diversification maybe and that's a little bit concerning and that's something that has to be kept in mind when you're looking at the company. >> are we at a monumental shift in the drug industry's fortune. >> overall, not just the business mod snell. >> drug pricing and drug pricing and sort of the pbms in on it and ultimately the employers and employees and this drug pricing model which has been so fantastic for six years that i think the game is over. >> even if you don't know it's over, don't know if it can be

over. >> he makes it uninvestable right now. >> no message yet. >> you played the value act leaders and i'm looking that paulson added to his mallinckrodt position. when all this fraud and regulation and all this stuff is going on, no reason to continue to dig in on that stuff. the best investor is out there and these guys historically have very good investment histories but you don't go down with the ship and that's the thing. you know. i watched the interview and i'm amazed that's the message he's giving on the eve of the report and i couldn't think about people watching the show sitting there on their machines buying it because this guy is such a genius. >> still ahead, shares of oracle higher after hours. much more "fast money" still

ahead.

i'm here at the td ameritrade trader offices. steve, other than making me move stuff, what are you working on? let me show you. okay. our thinkorswim trading platform aggregates all the options data you need in one place and lets you visualize that information for any options series. okay, cool. hang on a second. you can even see the anticipated range of a stock expecting earnings. impressive... what's up, tim. td ameritrade. welcome back to "fast money." i'm josh lipton.

apple just now filing a response to the department of justice in this ongoing fight. you'll recall that late last week the doj filed a brief in which it went offer apple, called it false and corrosive and suggest it had had kind of a special relationship with china. apple now firing back saying it has become crystal clear that this case is not about a modest order and a single iphone. instead, this case hinges on a consentious policy issue about how society should weigh what law enforcement officials want about the widespread repercussions ant the serious risks their demands would create. it will be interesting to see whether apple executives touch on this issue. melissa, back to you. >> thank you. now an earnings alert on oracle and jon fortt is back at headquarters with the key headlines moving the stock. >> this call continues to be all about the cloud, melissa. take a listen to safra catz

setting it in context. >> over this fiscal year i expect constant currency will be positive and comprised of continued growth in software support that offsets decline in new software license. >> she talked about how long oracle has been working on cloud. a few key points. software is going to be up between 57% and 61% and infrastructure as a service, minus 1 to plus 3. she also gave limited guidance for q1. that's farther out than they often go saying that the cloud is going to be up 59% plus. infrastructure as service growth is more moderate, partly because that have legacy hosting business and capital expenses for the club for the fiscal year are not going to grow. they follow like they spent enough. >> thanks very much. up next, the traders tell you what they are watching tomorrow. stay tuned.

our final trade on oracle on the back of earnings. dan, how do you trade it? >> i don't think you chase it at 48.5. the comparisons to cloud revenue, i think it will get better in 2016 but 15 times this year's earnings, probably growing at mid to high single digits, don't chase it at 40.5. >> pete? >> cloud is the place to be, took off red hat the other day. don't chase this name but this name is going higher.

pull back by going higher. >> i'm melissa lee. thanks so much for watching tonight. see you back here tomorrow at 5:00 for more "fast money." meantime, don't go anywhere. "mad money" with jim cramer starts right now. my mission is simple, to make you money. i'm here to level the playing field for all investors. there's always a bull market somewhere and i promise to help you find it. "mad money" starts now. >> i'm cramer. welcome to "mad money" welcome to cramerica. my job is not just to entertain you, to educate, teach, coach. call me 1800-cnbc or tweet me at jim cramer. why is this market so hard to kill? why won't it go down and stay down? just witnessed today dow opened more than 100 points.