Valeant Pharmaceuticals International Inc. has ruined the notoriety of a mutual fund that traverses its source to billionaire Warren Buffett. Robert Goldfarb, Ruane, Cunniff & Goldfarb chief executive officer and a co-manager of the Sequoia Fund will retire and will be succeeded by David Poppe who will become the lead manager and company's CEO, according to the firm's letter to the shareholders on Wednesday.

Sequoia chairman Roger Lowenstein said that he has faith in Poppe and his team that Poppe will not be afraid to buy not so well-known stocks and sell them. He also added that Goldfarb was responsible for the Valeant share since he was the CEO of the firm.

According to Bloomberg compiled data, since 1970, Sequoia has returned 14% of yearly gains up to last year surpassing the 11% of the Standard and Poor's 500 Index.  However, this year it dived to the lowest point of the pack as a result of Valeant's downfall. The fund fell 11% this year and pulled more than 99% of peers after lagging behind 89% in 2015.

Investors withdrew $780 million from the fund in the five months to the end of February and further plunges in Valeant shares last week generate more solicitude to be expected. In one day, Sequoia Fund went from 51^st out of 100 funds in its category to 98^th, in terms of year-to-date performance when Valeant informed it could violate banking covenants due to financial reports delay, the Financial Times reports.

"While our commitment to a value-oriented strategy grounded in extensive primary research remains as strong as ever, the Valeant experience has spurred a period of reflection," he wrote. "We have resolved to take a more collaborative approach to constructing the portfolio that will feature a more significant role for our senior analysts."

Last week nearly 1.5 million Valeant shares had been sold by Sequoia in an effort to shrink investors' taxes by booking capital losses.  It's the same week that Valeant lost its single day market value of more than 50%, lessens earnings guidance and said it could confront a debt default due to its 2015 annual report filing, reports The Wall Street Journal.

CEO Robert Goldfarb will be retiring and will be replaced by David Poppe who co-managed the fund for 10 years and will also become the lead manager as well as becoming the CEO of Ruane, Cunniff & Goldfarb Inc. Mr. Goldfarb will retire by the end of March.