What: Shares of Concordia Healthcare (NASDAQ:CXRX), a Canadian-based pharmaceutical company, were up more than 15% in afternoon trading after the company reported third quarter earnings that impressed Wall Street.

So what: The company's growth by acquisition strategy continues to work well -- revenue, gross profit, and operating income all rose significantly over the year ago period. 

Source: Concordia Healthcare

While one time costs related to its $3.3 billion acquisition of Amdipharm Mercury Limited had the company reporting a $0.13 earnings per share loss during the period, when stripping out those one-time costs the company managed to produce adjusted earnings per share of $1.46, which was up a huge 157% over last year's results.

Looking ahead, the company reaffirmed its guidance and still expects its adjusted EBITDA to land between $610 million to $640 million for the year.

Now what: Today's rally should come as some relief to longer-term shareholders. Concordia Healthcare has seen its share price collapse over the last few months as its business practices have been called into question given the fallout of Valeant Pharmaceuticals (NYSE:BHC), which also uses a growth by acquisitions strategy.

A look at a three month chart of both Concordia Healthcare and Valeant Pharmaceuticals is telling:

VRX Chart

Concordia's CEO Mark Thompson has done his best to refute claims that the companies are similarly engaged in unfair drug pricing. Thompson recently went on Canada's BNN in an attempt to distance his company from Valeant Pharmaceuticals, saying:

We have a very different business model than both Valeant and Turing. We have a model that doesn't rely on taking geometric price increases. We also have a model that buys products. We're not like Valeant that buys companies and tries to find synergies and strips them down.  

While Concordia's CEO may have a perfectly valid point, it might prove to be difficult for the company to shake that association. As long as Valeant Pharmaceuticals remains in the spotlight, then Concordia's stock might continue to suffer.

In the long run, if Concordia can continue to successfully integrate its acquisitions and produce solid results then its share price will eventually move in the right direction, which could make today's price might look like a great entry point in retrospect.