Valeant Pharmaceuticals' (VRX) tough year just got a little tougher.

Ruane, Cunniff & Goldfarb Inc., manager of Wall Street's legendary Sequoia Fund, issued a letter to investors Tuesday explaining why it chose to exit its investment in the Canadian pharmaceutical company last month after CEO and fund co-manager Robert Goldfarb retired in March.

"Our new leadership elected to sell our position in Valeant Pharmaceuticals, exiting completely by mid-June," the company's letter read. "Valeant was our largest position to start the year and its 80% decline through June 30 badly penalized our results. For the first half, Sequoia generated a negative 13.2% return vs. a positive 3.8% return for the S&P 500 Index."

Valeant shares fell following allegations about its relationship with its mail-order pharmacy, Philidor Rx Services and the company's legal, but criticized, accounting practices. However, its shares barely moved on the Sequoia sale news, trading at $23.22 Wednesday.

The former pharmaceutical industry darling shares lost 90% of their value since August, when when they readed at about $250 per share.

Sequoia wrote investors that it also sold its Allergan  (AGN - Get Report)  and Idexx Laboratories (IDXX - Get Report)  along with its Valeant position. "Idexx had been a wonderful stock for us over the past 13 years, compounding at better than a 17% rate from the time of our original purchases in 2003 through June 30," the company wrote.

"While Allergan has a stronger collection of assets and far better outlook than Valeant, we suspect many drug makers will face increasing pressure from healthcare payers who need to reduce the relentless double-digit inflation rate for branded pharmaceuticals," the company wrote in its letter.

The Sequoia fund also detailed other aspects of its investment strategy, including divestitures in  and Cabela's' Inc. (CAB)

Its position in Cabela's was significantly smaller than that of Idexx or Valeant, however, the company did note that it chose to exit "as deal rumors swirled." Cabela's is currently exploring strategic alternatives and has acknowledged that these could include a sale, while its rival, privately-held Bass Pro Shops, has been rumored to be looking at the company.