It is rare that William A. Ackman, the brash activist investor, apologizes for anything. As a successful hedge fund manager, Mr. Ackman has made billions of dollars for himself and his investors with bold and counterintuitive bets.

But this week he conceded that his firm’s biggest wager yet — on Valeant Pharmaceuticals International — was “a huge mistake” that has cost his hedge fund firm, Pershing Square Capital Management, “a tremendous amount.”

“I deeply and profoundly apologize,” Mr. Ackman added in an annual letter to investors.

It was an unusual moment of contrition for Mr. Ackman and a stark contrast to his emphatic support of Valeant in recent years.

Mr. Ackman staked his own reputation on Valeant even as the company faced steep challenges and regulatory scrutiny for its aggressive pricing tactics. He went to bat for Valeant when its executives were questioned during a Senate hearing. He loaded up on the stock when everyone else was selling.