NEW YORK (TheStreet) -- Valeant Pharmaceuticals  (VRX) stock is surging 8.75% to $29.34 on heavy trading volume this afternoon after announcing that CEO Mike Pearson will leave the company and activist investor Bill Ackman will join its board. 

The pharmaceutical company also announced that it is "committed to filing the 10-K on or before April 29." If it misses the deadline, Valeant could default on its $30 billion debt load. 

Even with a new CEO, Valeant still faces numbers that are "all over the map," an unknown cash flow, a dermatological business that is getting carved up by Allergan (AGN) and an ophthalmological business that is getting carved up by Johnson & Johnson (JNJ), TheStreet's Jim Cramer pointed out on CNBC's Squawk on the Street this morning.

"It's daunting to not know the cash of a company that's that indebted," Cramer continued.

He added that Valeant seems more like a clown show in need of corporate governance than a corrupt company.

The SEC or Justice Department should demand that Valeant get a monitor or an outsider to run the company, Cramer mentioned, noting that the government has intervened in smaller situations. 

"The whole thing seems unstable," Cramer said. "I just think this is more of a soap opera than it is a company."

Even though the stock might seem inexpensive at $30, he warns investors against buying shares of any pharmaceutical companies as both major Presidential candidates are "finding pharma to be guilty parties."

Of Valeant in particular, "before you think there's something there in Valeant, remember they're $30 billion in debt and the leadership situation is really in doubt," Cramer warns in the above video. "In those kinds of situations, go buy Johnson & Johnson."

Separately, TheStreet Ratings team rates the stock as a "hold" with a ratings score of C.

Valeant's strengths such as its robust revenue growth and expanding profit margins are countered by weaknesses including deteriorating net income, a generally disappointing performance in the stock itself and feeble growth in the company's earnings per share.

You can view the full analysis from the report here: VRX

TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this article's author.