Biovail Reports Fourth Quarter, Year-End 2004 Financial Results.TORONTO -- Company Achieves Record Revenues of $277.9 Million for Fourth Quarter and $886.5 Million for Year Ended December 31, 2004; Fourth-Quarter GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. of $0.29 Biovail Corporation (NYSE NYSE See: New York Stock Exchange :BVF BVF Biovail Corporation (stock symbol) BVF Berufsverband der Frauenärzte eV (Muenchen, Germany) BVF Bearing Versus Frequency )(TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :BVF) today announced financial results for the three-month and 12-month periods ending December 31, 2004. Total revenues for the three months ended December 31, 2004 were $277.9 million, compared with $199.7 million for the fourth quarter of 2003, an increase of 39%. Total revenues for the 12 months ended December 31, 2004 were $886.5 million, compared with $823.7 million for 2003, an increase of 8%. Fourth-quarter 2004 net income, in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. Generally Accepted Accounting Principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting (GAAP), was $46.0 million, compared with a net loss of $96.0-million for the corresponding 2003 period. Net income for the year ended December 31, 2004 was $161.0 million, compared with a $27.3-million net loss in 2003. GAAP diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of (EPS) for the fourth quarter of 2004 were $0.29, versus a $0.60 diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. loss per share for the fourth quarter of 2003. In 2004, GAAP diluted EPS was $1.01, compared with a diluted loss per share of $0.17 for the full year of 2003. "Biovail's record fourth-quarter revenues reflect the continued strength in Wellbutrin XL, and strong performance for Biovail's promoted products," said Biovail Chairman Eugene Melnyk Eugene Melnyk (born May 27, 1959 in Toronto, Ontario) is a Canadian businessman of Ukrainian origin who now resides in Barbados. He is the chairman and chief executive officer of Biovail Corporation. . "With a significantly de-leveraged balance sheet and a new Strategic Plan close to implementation, Biovail will be better positioned to capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. its value-creating technologies and capabilities." Dr. Douglas Squires, Chief Executive Officer, said, "Our goal is to maximize shareholder value - more specifically, to increase the profitability of our U.S. business while maintaining a direct commercial presence that allows us both the flexibility and opportunity to create sustainable growth. At this time, we are actively evaluating various alternatives to better leverage our U.S. commercial organization. This is a top priority for Biovail. While it is difficult to predict the exact timing, we are working toward implementation in the next 30 to 60 days." Biovail today announced its revenues and earnings guidance for 2005 (see separate news release). The financial guidance presented today reflects the Company's strength in capitalizing on its drug-delivery technologies to develop and commercialize medications that offer clinically meaningful enhancements to existing medications. On March 3, 2005, the United States Securities and Exchange Commission (SEC) served a subpoena subpoena (səpē`nə) [Lat.,=under penalty], in law, an order to a witness to appear before a court. A subpoena ad testificandum [Lat. on the Company pursuant to a formal order of investigation related to an informal inquiry initiated in November 2003. The investigation relates primarily to a number of accounting and disclosure practices. Biovail has been fully co-operating with the SEC, and will continue to do so, in an effort to bring the investigation to a conclusion in an expeditious ex·pe·di·tious adj. Acting or done with speed and efficiency. See Synonyms at fast1. ex manner. Fourth-Quarter 2004, 2004 Full-Year Financial Performance Product sales for the fourth quarter of 2004 were a record $265.7 million, compared with $168.3 million in the fourth quarter of 2003, an increase of 58%. This solid performance is largely attributable to the ongoing success of Wellbutrin XL, Biovail's extended-release formulation formulation /for·mu·la·tion/ (for?mu-la´shun) the act or product of formulating. American Law Institute Formulation of bupropion hydrochloride bu·pro·pi·on hydrochloride n. A drug used to treat depression and nicotine dependence. bupropion hydrochloride Budeprion SR, Budeprion XL, Wellbutrin, Wellbutrin SR, Wellbutrin XL, Zyban for the treatment of depression. In August, rapidly increasing sales for Wellbutrin XL moved Biovail into the third and highest tier of its pricing agreement with GlaxoSmithKline. Also contributing to the positive fourth-quarter performance was Biovail Pharmaceuticals Canada (BPC BPC British Potato Council BPC Brewton-Parker College (Mt Vernon, GA) BPC Bible Presbyterian Church BPC Bangladesh Petroleum Corporation (Chittagong, Bangladesh) BPC British Pharmaceutical Codex ) and Biovail's portfolio of generic products. Product sales for the full year 2004 were $841.4 million, compared with $632.9 million for the comparable 12-month period in 2003, an increase of 33%. As a percentage of total corporate revenue, product sales were 96% and 95% in the fourth quarter and all of 2004, respectively, compared with 84% and 77% in the fourth quarter and full year 2003, respectively. Core products - more specifically, those that Biovail, or a distribution partner, is actively promoting (Cardizem LA, the Teveten line, the Zovirax line, BPC products and Wellbutrin XL) - generated revenues of $185.7 million in the fourth quarter of 2004 and $565.8 million for the full year, compared with $105.9 million and $322.5 million in the corresponding periods in 2003, an increase of 75% in both cases. Core products represented 67% of overall revenues in the fourth quarter of 2004, compared with 53% in the corresponding 2003 period, demonstrating continued organic growth in Biovail's core business. For the full year, core products represented 64% of overall revenues, compared with 39% for the full year 2003. Revenues for Wellbutrin XL were $109.7 million in the fourth quarter of 2004, compared with $48.6 million in the fourth quarter of 2003, as Wellbutrin XL continues to gain share in the U.S. anti-depressant market. For the full year 2004, Wellbutrin XL revenues were $317.3 million, compared with $64.9 million for 2003 (Wellbutrin XL was launched in September 2003). In December 2004, Wellbutrin XL captured 54.8% of the new prescriptions written for the Wellbutrin brand (including generics). During 2004, GlaxoSmithKline built its safety stock levels of Wellbutrin XL - both from a strategic perspective and in anticipation of Biovail shifting its manufacturing attention to once-daily tramadol in 2005. Revenues from Biovail's promoted products (Cardizem LA, Teveten, Teveten HCT Hct abbr. hematocrit HCT Hematocrit, see there , Zovirax Ointment ointment /oint·ment/ (oint´ment) a semisolid preparation for external application to the skin or mucous membranes, usually containing a medicinal substance. oint·ment n. and Zovirax Cream) were $46.3 million in the fourth quarter of 2004, compared with $33.8 million in the corresponding period in 2003, an increase of 37% largely attributable to Zovirax. For 2004, revenues from promoted products were $146.7 million, compared with $172.4 million for the corresponding period in 2003. This 15% decrease primarily reflects the impact of reduced wholesaler inventory levels in 2004. Importantly, Biovail has signed distribution service agreements (DSAs) with the three largest U.S. pharmaceutical wholesalers. Going forward, this initiative should allow for reported revenues to more closely track prescription trends. Total prescriptions for Biovail's promoted products increased 12% in the fourth quarter of 2004, compared with the fourth quarter of 2003, and increased 34% for 2004, compared with 2003. Cardizem LA generated revenues of $10.3 million in the fourth quarter of 2004, compared with $20.0 million for the corresponding period in 2003. The decrease reflects a reduction in wholesaler inventories for the product. For the 12 months ended December 31, 2004, revenues for Cardizem LA were $53.6 million, up 12% from the $47.7 million recorded in the same period in 2003 (Cardizem LA was launched in April 2003). Cardizem LA total prescription volume increased 30% for the fourth quarter of 2004 and 108% for the full year 2004, versus the comparable periods in 2003, as Cardizem LA continues to gain market share in the once-daily diltiazem market. Cardizem LA captured 8.2% of total prescription volume for the class in the fourth quarter of 2004, compared with 6.1% in the fourth quarter of 2003. In 2004, Cardizem LA's share of the once-daily diltiazem market increased 30.6%. Biovail's Teveten franchise (Teveten, Teveten HCT) generated revenues of $5.2 million in the fourth quarter of 2004, compared with $2.1 million in the prior year period. For 2004, revenues for the Teveten line were $17.6 million, compared with $22.2 million for the full year 2003. Total prescriptions for Biovail's Teveten line of products increased 21% in the fourth quarter of 2004 and 27% in the 2004, compared with the corresponding periods in 2003. Fourth-quarter 2004 revenues for Biovail's Zovirax line (Zovirax Cream and Zovirax Ointment) were $30.8 million, compared with $11.7 million in the prior-year period. Zovirax revenues for the year ended December 31, 2004, were $75.5 million, compared with $102.4 million for the comparable period in 2003. Total prescriptions for Zovirax decreased 4% in the fourth quarter of 2004 and 2% in the full year 2004, compared with the corresponding periods in 2003. In the fourth quarter of 2004, Zovirax Ointment and Zovirax Cream held a combined 64.8% share of the topical topical /top·i·cal/ (top´i-k'l) pertaining to a particular area, as a topical antiinfective applied to a certain area of the skin and affecting only the area to which it is applied. top·i·cal adj. herpes Herpes Any virus of the herpesvirus group, which comprises a family of 70 species, 5 of which are pathogenic to humans; the term also refers to any infection caused by these viruses. market, an increase of 4.2 percentage points in market share versus fourth-quarter 2003 levels. However, the topical herpes market continued to lose share to oral formulations. Biovail Pharmaceuticals Canada (BPC) revenues were $29.7 million in the fourth quarter of 2004 and $101.9 million for the full year 2004, compared with $23.4 million and $85.2 million in the fourth quarter and full year 2003, respectively. The key performance drivers for BPC were Wellbutrin SR and Tiazac. Total prescription volume for Wellbutrin SR increased 22% in the fourth quarter of 2004, versus the comparable 2003 period. Total prescription volume for Tiazac increased 16% in the fourth quarter of 2004, compared with the same period in 2003. During the fourth quarter of 2004, Biovail started to ship quantities of Tiazac XC, its once-daily extended-release formulation of diltiazem for the treatment of hypertension hypertension or high blood pressure, elevated blood pressure resulting from an increase in the amount of blood pumped by the heart or from increased resistance to the flow of blood through the small arterial blood vessels (arterioles). . Tiazac XC was formally launched in Canada on January 25, 2005. Legacy products generated revenues of $36.9 million for the fourth quarter of 2004, compared with $36.4 million for the corresponding period in 2003. For the full-year 2004, Legacy products generated revenues of $125.9 million, compared with $208.9 million in the year-ago period. The decrease in 2004 revenues can be primarily attributed to expected year-over-year declines in total prescription volumes for these mature products. Other factors contributing to the decline include a reduction in wholesaler inventory levels, the genericization of Tiazac in April 2003 and the termination in August 2004 of the sub-licensing agreement for Cedax. In the fourth quarter of 2004, total prescription volume decreased 32%, relative to 2003 levels, which is generally in line with Biovail's expectations. Biovail also announced today that the Company's Board of Directors is in the process of evaluating a number of options to maximize the value of Biovail's Legacy products (see separate news release). Sales revenue for Biovail's generic products was $43.1 million in the fourth quarter of 2004, compared with $25.9 million in the fourth quarter of 2003, an increase of 66%. Generic product sales for the 12 months ended December 31, 2004, were $149.7 million, compared with $101.5 million for the comparable period in 2003, an increase of 47%. The increase in generic product sales was mainly due to strong sales of generic Adalat CC and Cardizem CD, the renegotiated agreement with our distribution partner Teva Pharmaceutical Inc., and the normalization In relational database management, a process that breaks down data into record groups for efficient processing. There are six stages. By the third stage (third normal form), data are identified only by the key field in their record. of inventory levels at Teva. Product Sales Performance Summary The following table summarizes Biovail's product sales performance in the fourth quarter and full-year 2004 and 2003:
($000s) Q4/04 Q4/03 Growth 2004 2003 Growth
Sales Sales Rate Sales Sales Rate
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Promoted Products 46,334 33,847 37% 146,676 172,418 (15%)
Wellbutrin XL 109,715 48,636 126% 317,298 64,932 N/M
Biovail
Pharmaceuticals
Canada 29,673 23,427 27% 101,865 85,197 20%
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Total Core Products 185,722 105,910 75% 565,839 322,547 75%
Legacy Products 36,853 36,413 1% 125,932 208,860 (40%)
Generics 43,104 25,946 66% 149,675 101,491 47%
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Total Product Sales 265,679 168,269 58% 841,446 632,898 33%
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Total Prescription Volume Summary The following table summarizes total prescription volume in the fourth quarter and full-year 2004 and 2003:
(000s) Q4/04 Q4/03 Growth 2004 2003 Growth
Total Rx Total Rx Rate Total Rx Total Rx Rate
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Promoted
Products 872,796 776,592 12% 3,264,282 2,439,446 34%
Wellbutrin XL 2,791,719 951,436 193% 9,450,855 984,498 N/M
Biovail
Pharmaceuticals
Canada 804,341 763,808 5% 3,095,195 2,955,372 5%
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Total Core
Products 4,468,856 2,491,836 79% 15,810,332 6,379,316 148%
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Legacy Products 688,129 1,012,040 (32%) 3,068,578 5,473,544 (44%)
Generics 1,865,437 1,980,827 (6%) 7,600,178 8,290,023 (8%)
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Total
Prescriptions 7,022,422 5,484,703 28% 26,479,088 20,142,883 31%
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Source: IMS
Co-promotion, royalty and licensing revenue was $4.6 million and $24.6 million for the fourth quarter and full year 2004, compared with $28.0 million and $176.6 million in the corresponding periods in 2003, representing decreases of 84% and 86%, respectively. These declines primarily reflect the conclusion of Biovail's economic interest in the sales of a generic formulation of Prilosec (omeprazole omeprazole /omep·ra·zole/ (o-mep´ra-zol) an inhibitor of gastric acid secretion used in the treatment of dyspepsia , gastroesophageal reflux disease, disorders of gastric hypersecretion, and peptic ulcer, including that associated with ), in addition to the termination of the co-promotion agreements for Wellbutrin SR in the United States in March 2003, and Celexa in Canada in December 2003. Cost of goods sold Cost of goods sold The total cost of buying raw materials, and paying for all the factors that go into producing finished goods. cost of goods sold for the fourth quarter of 2004 was $65.3 million, compared with $50.6 million in the fourth quarter of 2003, an increase of 29%. Cost of goods sold for full-year 2004 was $228.3 million, compared with $139.5 million for the comparable 12-month period in 2003, an increase of 64%. The increase in cost of goods sold is primarily related to an increase in product sales revenues. Gross margins on product sales were 75% in the fourth quarter of 2004, compared with 70% in the fourth quarter of 2003, an increase that largely reflects the impact of higher volumes and supply pricing for Wellbutrin XL in the fourth quarter of 2004. Gross margins for full-year 2004 were 73%, down from the 78% realized in 2003, which was favorably fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. impacted by the recognition of a $25.5-million cumulative reduction in the Zovirax supply price. Research-and-development expenditures for the fourth quarter of 2004 were $19.0 million, compared with $26.1 million for the fourth quarter of 2003. Research and development expenditures for all of 2004 were $70.5 million, compared with $86.6 million for the comparable 12-month period in 2003. The decreases in 2004 reflect the culmination of certain high-cost clinical trials that were ongoing during 2003, versus conducting numerous earlier-stage, lower-cost programs during 2004. Selling, General and Administrative Expenses Selling, general and administrative (SG&A) expenses for the fourth quarter of 2004 were $73.0 million, compared with $66.3 million in the fourth quarter of 2003, an increase of 10%. For 2004, SG&A expenses were $257.4 million, compared with $242.8 million for the comparable 2003 period, an increase of 6%. The increases reflect higher headcount numbers in Biovail's U.S. sales force and the initiation of marketing programs in support of the Company's promoted products. As a percentage of total revenue, SG&A expenses were 26% in the fourth quarter and 29% for full-year 2004, compared with 33% and 29%, respectively, for the corresponding periods in 2003. Amortization expense in the fourth quarter of 2004 was $15.8 million, compared with $26.2 million in the fourth quarter of 2003, a decrease of 40%. Amortization expense for the full year 2004 was $65.0 million, down 54% from $140.9 million for the same period a year earlier. The significant decrease in this expense item primarily reflects the conclusion of Biovail's participating interest in generic omeprazole in early 2004. Specific Items Affecting Operations In the fourth quarter of 2004, Biovail recorded $42.2-million in non-cash charges Non-Cash Charge A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. (which impacted EPS by $0.26), related to the write-down of the remaining carrying value Carrying Value Also know as "book value," it is a company's total assets minus intangible assets and liabilities, such as debt. Notes: This is different than market value, as it can be higher or lower depending on the circumstances. of the Rondec product rights ($4.4 million), and an other-than-temporary decline in the value of the Company's equity investment in Ethypharm ($37.8 million). In the fourth quarter and full-year 2004, Biovail recorded a $4.1 million and $4.2 million, respectively, non-cash equity loss (which impacted EPS by $0.03) related to the Company's investment in the Western Life Sciences Venture Fund. Financial results for the 12-month period ended December 31, 2004, also include a $1.5-million gain (which positively impacted EPS by $0.01), related to the disposal of the Cedax product rights in the third-quarter of 2004, and an $8.6-million acquired R&D charge (which impacted EPS by $0.05), related to the acquisition of the remaining interest in BNC-PHARMAPASS in the first quarter of 2004. Strengthened Balance Sheet Biovail continues to strengthen its balance sheet. In 2004, Biovail made $280 million in payments against the Company's revolving-term credit facility, completely eliminating the debt outstanding under this facility. With respect to long-term obligations, Biovail made payments of $66.3 million in 2004. The Company's debt-to-equity ratio debt-to-equity ratio The relationship between long-term funds provided by creditors and funds provided by owners. A firm's debt-to-equity ratio is calculated by dividing long-term debt by owners' equity. Both items are shown on the balance sheet. stood at 0.5 at the end of the fourth quarter of 2004, compared with 0.9 at December 31, 2003. As at the end of February 2005, Biovail's cash balance was just under $100 million. Cash flows from operations were $111.7 million for the fourth quarter of 2004 and $277.1 million for the 12 months ended December 31, 2004. Capital expenditures in the fourth quarter and full year 2004 amounted to $7.8 million and $28.0 million, respectively. Product-Development Pipeline Progress In October 2004, Biovail received an Approvable Letter from the U.S. Food and Drug Administration (FDA FDA abbr. Food and Drug Administration FDA, n.pr See Food and Drug Administration. FDA, n.pr the abbreviation for the Food and Drug Administration. ) for a once-daily extended-release formulation of the analgesic analgesic (ăn'əljē`zĭk), any of a diverse group of drugs used to relieve pain. Analgesic drugs include the nonsteroidal anti-inflammatory drugs (NSAIDs) such as the salicylates, narcotic drugs such as morphine, and synthetic drugs tramadol. Earlier this week, Biovail submitted a Complete Response to the FDA's Approvable Letter. Biovail anticipates a response from the FDA in May 2005. In January 2005, Biovail received an Approvable Letter from the FDA for its NDA (Non Disclosure Agreement) An agreement signed between two parties that have to disclose confidential information to each other in order to do business. In general, the NDA states why the information is being divulged and stipulates that it cannot be used for any for an orally disintegrating tablet The Food and Drug Administration's (FDA) definition of an orally disintegrating tablet (ODT) is: "A solid dosage form containing medicinal substances which disintegrates rapidly, usually within a matter of seconds, when placed upon the tongue. (ODT See SCO Open Desktop. ODT - Open Desktop ) formulation of the analgesic tramadol hydrochloride tramadol hydrochloride Warning - High-alert drug! Dromadol (UK), Larapam (UK), Mabron (UK), Tramake (UK), Ultram, Ultram ER, Zamadol (UK), Zydol (UK) Pharmacologic class: Opioid agonist . The Approvable Letter involves the resolution of routine matters; final approval is anticipated mid-2005. A Complete Response was filed March 19, 2005 and we anticipate a response by the FDA in May 2005. In February 2005, the FDA issued an Approvable Letter for Biovail's ODT formulation of citalopram citalopram /ci·tal·o·pram/ (si-tal´o-pram) 1. an antidepressant compound used in the treatment of major depressive disorder, administered orally as the hydrobromide. 2. for depression. The Approvable Letter involves the clarification of a number of chemistry and manufacturing issues. Biovail anticipates rapidly providing this information and working with the FDA over the coming weeks and months to resolve these issues. In addition, the Letter provides revised package-insert language to reflect recent changes in the FDA's mandated labeling for the class of selective serotonin reuptake inhibitors Selective Serotonin Reuptake Inhibitors Definition Selective serotonin reuptake inhibitors are medicines that relieve symptoms of depression. Purpose (SSRIs) and other anti-depressants. In late-February 2005, Biovail, and partner Depomed, Inc. of Menlo Park Menlo Park. 1 Residential city (1990 pop. 28,040), San Mateo co., W Calif.; inc. 1874. Electronic equipment and aerospace products are manufactured in the city. Menlo College and a Stanford Univ. research institute are there. 2 Uninc. , CA, received an Approvable Letter from the FDA related to the New Drug Application (NDA) for Glumetza(TM), an extended-release formulation of metformin metformin /met·for·min/ (met-for´min) an antihyperglycemic agent that potentiates the action of insulin, used in the treatment of type 2 diabetes mellitus. met·for·min n. for the treatment of Type II diabetes Type II diabetes Type II diabetes is the most common form of diabetes and usually appears in middle aged adults. It is often associated with obesity and may be delayed or controlled with diet and exercise. Mentioned in: Diabetic Ketoacidosis . The Approvable Letter indicated that Glumetza(TM) is approvable, pending the completion of discussions with regard to an issue related to finalizing one manufacturing specification. Biovail anticipates submitting a response to the FDA in the coming weeks. No clinical or labeling issues were identified in the letter. In other pipeline programs, Biovail expects to file a New Drug Submission (NDS See eDirectory. NDS - Netware Directory Services ) with the Therapeutic Products Directorate Therapeutic Products Directorate (TPD) is a Canadian federal authority that regulates pharmaceutical drugs and medical devices for human use, a role performed by the Food and Drug Administration in the United States. (TPD TPD Tons Per Day TPD Therapeutic Products Directorate TPD Total and Permanent Disablement (insurance) TPD Temperature Programmed Desorption TPD Temporary Partial Disability (insurance) ) in Canada before the end of March for Wellbutrin XL for the treatment of depression in adults. The application contained the results of two adequate and well-controlled trials in Major Depressive Disorder Major depressive disorder A mood disorder characterized by profound feelings of sadness or despair. Mentioned in: Conduct Disorder major depressive disorder , as well as other supporting clinical data. In addition, development efforts continue for novel formulations of several products, including venlafaxine venlafaxine /ven·la·fax·ine/ (ven?lah-fak´sen) an inhibitor of serotonin and norepinephrine reuptake that potentiates neurotransmitter activity in the central nervous system; used as the hydrochloride salt as an antidepressant and , bupropion bupropion /bu·pro·pi·on/ (bu-pro´pe-on) a monocyclic compound structurally similar to amphetamine, used as the hydrochloride salt as an antidepressant and as an aid in smoking cessation. , zolpidem zolpidem /zol·pi·dem/ (zol-pi´dem) a non-benzodiazepine sedative-hypnotic; used as the tartrate salt in the short term treatment of insomnia. , eprosartan, enalapril, and metoprolol metoprolol /met·o·pro·lol/ (met?ah-pro´lol) a cardioselective ß used in the form of the succinate and tartrate salts in the treatment of hypertension, chronic angina pectoris, and myocardial infarction. , including combination products with application in cardiovascular medicine and metabolic diseases metabolic disease, n a disorder that causes dysfunction of the metabolic action of the body, resulting in loss of control of homeostasis. paraneoplastic syndrome . Late last week, Flamel Technologies announced that it had ended its licensing agreement with Biovail for Genvir, a development-stage product for herpes and shingles shingles: see herpes zoster. shingles or herpes zoster Acute viral skin and nerve infection. Groups of small blisters appear along certain nerve segments, most often on the back, sometimes after a dull ache at the site; pain becomes . In April 2003, Biovail acquired the exclusive North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. rights to Flamel's oral, controlled-release formulation of Acyclovir acyclovir /acy·clo·vir/ (a-si´klo-ver) a synthetic purine nucleoside with selective activity against herpes simplex virus; used as the base or the sodium salt in the treatment of genital and mucocutaneous herpesvirus infections. . Since that time, Biovail has had numerous interactions with the FDA concerning the clinical program that the FDA is requiring as a basis for their approval. This process culminated in a formal Special Protocol Assessment, which was received from the FDA in September 2004. "The hurdles that the FDA established for this program were significant, patient numbers have quadrupled, and the resultant This article is about the resultant of polynomials. For the result of adding two or more vectors, see Parallelogram rule. For the technique in organ building, see Resultant (organ). In mathematics, the resultant of two monic polynomials costs for the clinical program have more than doubled relative to our estimates at the time the product was licensed," said Dr. Squires. "For these and other reasons, Biovail was in the process of discussing a separation when Flamel decided to terminate the agreement." In 2004, Biovail achieved several research-and-development milestones. These included the completion of four NDA filings, one NDS submission in Canada, and a supplemental NDS filing for the angina Angina Definition Angina is pain, "discomfort," or pressure localized in the chest that is caused by an insufficient supply of blood (ischemia) to the heart muscle. indication for Tiazac XC. With respect to approvals, Biovail received FDA approval for Cardizem LA in the treatment of angina and TPD approval for Tiazac XC in the treatment of hypertension in Canada. Biovail commercialized Tiazac XC on January 25, 2005. Steinbach Expansion In late February 2005, Biovail announced a $27.6-million expansion project to further enhance the manufacturing capability of the Company's largest manufacturing facility located in Steinbach, Manitoba
Steinbach is a city of approximately 12,000 people (2007 est.) (11,066 - 2006 census) in the province of Manitoba, Canada, a short distance from the capital Winnipeg. , 70 kilometres southeast of Winnipeg. The expansion at Steinbach will enable Biovail to optimize optimize - optimisation the current capacity with a focus on world-class manufacturing performance, as well as to meet growing demand and opportunities. In 2004, Steinbach produced more than 1.4 billion of the over 1.6 billion dosage dosage /dos·age/ (do´saj) the determination and regulation of the size, frequency, and number of doses. dos·age n. 1. Administration of a therapeutic agent in prescribed amounts. units made by the Company's manufacturing facilities; the others are in Dorado dorado: see dolphin (fish). and Carolina, Puerto Rico Carolina (kah-ro-LEE-nah) is a city located in the northern part of Puerto Rico, bordering the Atlantic Ocean; north of Gurabo and Juncos; east of Trujillo Alto and San Juan; and west of Canóvanas and Loíza. . In 2003, Steinbach produced just over 600 million dosage units. Enhanced Corporate Governance Corporate Governance The relationship between all the stakeholders in a company. This includes the shareholders, directors, and management of a company, as defined by the corporate charter, bylaws, formal policy, and rule of law. Biovail's Board of Directors is actively engaged with management in a comprehensive review of Biovail's corporate-governance practices. This action reflects a commitment made by Chairman Eugene Melnyk in June 2004 to enhance investor confidence in the Company. To this end, Biovail has engaged the services of renowned corporate-governance expert Carol Hansell Caroll Hansell sits on the Board of Directors of the Bank of Canada. She studied at the University of Western Ontario, then did an MA at the University of Toronto and then rose to success after taking the MBA/LLB degree at the prestigious Osgoode Hall Law School and Schulich School of of the law firm Davies Ward Phillips & Vineberg LLP LLP - Lower Layer Protocol . Among the initiatives announced to date include the separation of roles of Chairman and Chief Executive Officer; a review of Board structure, its composition, processes, practices and recruitment; a succession process designed to ensure the ongoing renewal of its Board; and the adoption of voting to elect individual directors, thereby eliminating traditional 'slate voting'. Additional initiatives reflecting the governance priorities of Biovail's shareholders will be announced shortly. Conference Call Biovail management will host a conference call and Webcast on Thursday, March 10, 2005, at 8:30 a.m. EST EST electroshock therapy. EST abbr. electroshock therapy for Company executives to discuss fourth-quarter and 2004 year-end financial results. Following the discussion, Biovail executives will address inquiries from research analysts. A live Webcast of this call will be available through the Investor Relations Investor relations The process by which the corporation communicates with its investors. section of the Biovail Web site at www.biovail.com. To access the call live, please dial 416-405-9310 (Toronto and International callers) and 1-877-211-7911 (U.S. and Canada). Listeners are encouraged to dial in 10 minutes before the call begins to avoid delays. A replay of the conference call will be available until 7 p.m. EST P.M. also p.m. or p.m. abbr. post meridiem Usage Note: By definition, 12 a.m. on Thursday, March 17, 2005, by dialing 416-695-5800 (Toronto and International callers) and 1-800-408-3053 (U.S. and Canada), using access code, 3140863. About Biovail Corporation Biovail Corporation is an international full-service pharmaceutical company, engaged in the formulation, clinical testing, registration, manufacture, sale and promotion of pharmaceutical products utilizing advanced drug-delivery technologies. For further information, please contact Ken Howling at 905-286-3000 or send inquiries to ir@biovail.com. "Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. " Statement Under the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995 To the extent any statements made in this release contain information that is not historical, these statements are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. within the meaning of Section 27A of the Securities Act of 1933, as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. , and Section 21E of the Securities Exchange Act of 1934, as amended. We have based these forward-looking statements on our current expectations and projections about future events. Our actual results could differ materially from those discussed in, or implied by, these forward-looking statements. Forward-looking statements are identified by words such as "believe", "anticipate", "expect", "intend", "plan", "will", "may" and other similar expressions. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or are forward-looking statements. Forward-looking statements include, but are not necessarily limited to, risks and uncertainties, including the difficulty of predicting U.S. Food and Drug Administration and Canadian Therapeutic Products Directorate approvals, acceptance and demand for new pharmaceutical products, the impact of competitive products and pricing, new product development and launch, reliance on key strategic alliances, availability of raw materials and finished products, the regulatory environment, the outcome of legal proceedings All actions that are authorized or sanctioned by law and instituted in a court or a tribunal for the acquisition of rights or the enforcement of remedies. , fluctuations in operating results and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission and the Ontario Securities Commission The Ontario Securities Commission (OSC) is a regulatory agency which administers and enforces securities legislation in the Canadian province of Ontario. The OSC is an Ontario Crown corporation which reports to the Ontario legislature through the Minister of Finance. . Biovail undertakes no obligation to update or revise any forward-looking statement.
BIOVAIL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(All dollar amounts are expressed in thousands of
U.S. dollars, except per share data)
(Unaudited)
Three Months Ended Twelve Months Ended
December 31 December 31
-------------------- --------------------
2004 2003 2004 2003
--------- ---------- --------- ----------
REVENUE
Product sales $265,679 $ 168,269 $841,446 $ 632,898
Research and development 7,621 3,424 20,452 14,239
Co-promotion, royalty and
licensing 4,579 28,042 24,645 176,585
--------- ---------- --------- ----------
277,879 199,735 886,543 823,722
--------- ---------- --------- ----------
EXPENSES
Cost of goods sold 65,250 50,633 228,278 139,456
Research and development 19,024 26,143 70,493 86,570
Selling, general and
administrative 73,029 66,335 257,407 242,771
Amortization 15,807 26,245 64,976 140,895
Write-down of assets, net of
gain on disposal 42,156 45,081 40,685 45,081
Acquired research and
development - 22,111 8,640 124,720
Extinguishment of royalty
obligation - 61,348 - 61,348
Settlements - - - (34,055)
--------- ---------- --------- ----------
215,266 297,896 670,479 806,786
--------- ---------- --------- ----------
Operating income (loss) 62,613 (98,161) 216,064 16,936
Interest income 277 1,272 1,034 7,165
Interest expense (9,637) (10,392) (40,104) (40,421)
Foreign exchange gain (loss) 594 (4,413) (564) (14,007)
Other expense (4,052) (1,644) (6,486) (938)
--------- ---------- --------- ----------
Income (loss) before
provision for (recovery of)
income taxes 49,795 (113,338) 169,944 (31,265)
Provision for (recovery of)
income taxes 3,750 (17,300) 8,950 (4,000)
--------- ---------- --------- ----------
Net income (loss) $ 46,045 $ (96,038) $160,994 $ (27,265)
--------- ---------- --------- ----------
--------- ---------- --------- ----------
Diluted earnings (loss) per
share $ 0.29 $ (0.60) $ 1.01 $ (0.17)
--------- ---------- --------- ----------
--------- ---------- --------- ----------
Diluted weighted average
number of common shares
outstanding (000s) 159,349 158,768 159,258 158,516
--------- ---------- --------- ----------
--------- ---------- --------- ----------
BIOVAIL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(All dollar amounts are expressed in thousands of U.S. dollars)
(Unaudited)
December 31
-----------------------
2004 2003
----------- -----------
ASSETS
Cash and cash equivalents $ 34,324 $ 133,261
Other current assets 280,327 279,191
Long-term investments 68,046 113,546
Property, plant and equipment, net 186,556 173,804
Goodwill 100,294 100,814
Intangible assets, net 978,073 1,049,475
Other assets, net 63,440 72,683
----------- -----------
$1,711,060 $1,922,774
----------- -----------
----------- -----------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities $ 190,237 $ 262,568
Long-term obligations 445,471 764,111
Other long-term liabilities 21,439 14,500
Shareholders' equity 1,053,913 881,595
----------- -----------
$1,711,060 $1,922,774
----------- -----------
----------- -----------
BIOVAIL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(All dollar amounts are expressed in thousands of U.S. dollars)
(Unaudited)
Twelve Months Ended
December 31
-----------------------
2004 2003
----------- -----------
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $ 160,994 $ (27,265)
Adjustments to reconcile net income (loss) to
net cash provided by
operating activities
Depreciation and amortization 88,307 157,317
Amortization of deferred financing costs 4,322 2,975
Amortization of discounts on long-term
obligations 3,218 6,562
Write-down of assets, net of gain on disposal 40,685 45,081
Acquired research and development 8,640 124,720
Equity loss 4,179 1,010
Other 6,920 4,883
Changes in operating assets and liabilities (40,175) (33,304)
----------- -----------
Net cash provided by operating activities 277,090 281,979
CASH FLOWS FROM INVESTING ACTIVITIES (42,263) (278,446)
CASH FLOWS FROM FINANCING ACTIVITIES (334,526) 72,523
Effect of exchange rate changes on cash and
cash equivalents 762 1,125
----------- -----------
Net increase (decrease) in cash and cash
equivalents (98,937) 77,181
Cash and cash equivalents, beginning of period 133,261 56,080
----------- -----------
Cash and cash equivalents, end of period $ 34,324 $ 133,261
----------- -----------
----------- -----------
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