Biovail Reports Significant Improvements in Corporate Governance.

TORONTO -- Biovail Corporation (NYSE:BVF) (TSX:BVF):

--Reforms Made to Governance Structures, Practices, Transparency, Disclosure

--Company Also Provides Update on Various Regulatory Matters

Biovail Corporation (NYSE:BVF) (TSX:BVF) announced today that it has made significant improvements to its corporate-governance framework. These improvements are part of the ongoing governance-enhancement initiative implemented since Executive Chairman Eugene Melnyk first announced in June 2004 the Company's commitment to increase investor confidence.

"The significant reforms we're reporting today reflect Biovail's commitment to an effective and transparent corporate-governance framework," said Mr. Melnyk. "We've achieved a great deal to date, but there's still more we want to accomplish in this area.

"We will continue to evolve our governance practices to increase investor and regulator confidence, provide stakeholders with material information, and contribute to our ongoing effort to generate value for our shareholders."

The governance-enhancement measures approved and implemented to date have resulted in changes to Biovail's governance structures, policies and practices. They fall under three broad headings - defining the responsibilities of the Board and management; enhancing Board effectiveness; and increasing transparency to, and communication with, shareholders.

Defining Board, Management Responsibilities

Biovail has taken a number of steps to define the appropriate responsibilities of key participants in the governance process. Written charters, job descriptions and other measures have been developed or revised to clarify the roles and duties of the Board, Board committees, the Executive Chairman, the Chief Executive Officer, and the Chairs of the Nominating and Corporate Governance Committee, and of the Audit Committee. The written job description for the Governance Committee chair underscores the leadership position that this independent director has on the Board. The Board has also reviewed its committee structure and the membership of each committee. It has also established a Risk and Compliance Committee to assist in overseeing the Company's management of risk, as well as the development and effectiveness of its compliance programs.

Enhancing Board Effectiveness

Biovail's Board of Directors has approved a number of measures designed to enhance the workings of the Board, a number of which have already been implemented. Individual voting for Board nominees has been adopted, effective with the upcoming Annual General and Special Meeting of Shareholders in June, thus ending traditional 'slate voting.' A formal Board renewal and succession process was initiated to identify and recruit the candidates needed to supplement existing skill sets and reinforce the independence of the Board. Two new nominees to the Board of Directors will be proposed to shareholders when Biovail's information circular is released in the coming weeks. The nomination of these individuals is consistent with the commitment of Biovail's Board to enhancing its skill set and reinforcing its independence from management.

The system of director compensation was reviewed, and stock options for directors were discontinued in favor of deferred stock units. The frequency of in-camera meetings of directors has been increased. Director orientation and continuing-education programs have been instituted. A Board Secretariat and other resources have been established to provide directors with the information and support they need to perform their duties. And a director assessment and evaluation process was put in place.

Improving Transparency and Communication with Shareholders

The Board has also taken steps to demonstrate its commitment to transparency and communication with Biovail's shareholders. A number of shareholders were interviewed by the Company and by an independent leading provider of corporate-governance research and related services. The interviews solicited views and suggestions on the Company's governance practices. The existing disclosure process was reviewed with a particular focus on the integrity and transparency of the information issued by the Company. As a result, a Disclosure Committee consisting of senior executives of the Company was established.

Update on Various Regulatory Matters

In keeping with the commitment to transparency and communication demonstrated by the governance-enhancement initiative, Biovail today is also providing an update on various regulatory matters.

Ontario Securities Commission (OSC): Biovail has been co-operating with the OSC's ongoing review of the Company's disclosure and its review of certain trading activities related to Biovail common shares. The OSC has now clarified that it is investigating, among other things, certain accounting and disclosure matters in 2003, as well as several issues relating to trading activity in Biovail shares.

More specifically, staff of the Commission has advised Biovail that it is investigating, among other things, two issues relating to Biovail's accounting and disclosure in 2003. The first is whether Biovail improperly recognized revenue for accounting purposes in relation to its interim financial statements for each of the four quarters in 2003. The second is whether Biovail provided misleading disclosure in its press release dated October 3, 2003 concerning the reasons for Biovail's forecast of a revenue shortfall in respect of the three-month period ending September 30, 2003.

Commission staff has also advised that it is investigating four issues relating to trading in Biovail common shares. These issues include whether insiders of Biovail complied with insider reporting requirements, and whether persons in a special relationship with Biovail may have traded in Biovail shares with knowledge of undisclosed material information. Staff of the Commission is also investigating whether certain transactions may have resulted in, or contributed to, a misleading appearance of trading activity in Biovail securities during 2003 and 2004, and whether certain registrants (who are past, or present, directors of Biovail) may have been in a conflict of interest in relation to trading of Biovail shares.

Biovail has been co-operating and continues to co-operate fully with the OSC in these matters. The Company cannot predict the outcome or the timing of when this matter may be resolved.

Office of the Inspector General (OIG): In November 2004, executives of Biovail met with the OIG to discuss the agency's review of a program utilized by the Company from April 2003 to August 2003 related to the commercialization of Cardizem(R) LA. Biovail advised that it had taken precautionary steps to ensure that the program in question, a Clinical Experience Program, met the applicable rules and regulations. These steps included relying on advice from various external consulting, legal and regulatory advisory firms, as well as relying on a representation from the company that designed the program on behalf of Biovail. Recently, the OIG has indicated, through the issuance of subpoenas, its desire to interview certain persons (employees and non-employees) in order to confirm the Company's position as presented to the agency. Biovail is working diligently to resolve this matter, although the Company cannot predict the outcome or the timing of when this matter may be resolved.

U.S. Securities and Exchange Commission (SEC): In March 2005, the SEC advised Biovail that it had issued a formal order of investigation related to the previously disclosed informal inquiry initiated in November 2003 which sought historical financial and related information, including, but not limited to the Company's accounting and financial disclosure practices. The formal investigation continues to focus primarily on accounting practices; however, the scope of the investigation is broader and includes certain transactions associated with a corporate entity since acquired by the Company. The period under review is January 2001 through May 31, 2004. 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 as expeditiously as possible.

About Biovail Corporation

Biovail Corporation is specialty pharmaceutical company, engaged in the formulation, clinical testing, registration, manufacture, and commercialization of pharmaceutical products utilizing advanced drug-delivery technologies. For more information about Biovail, visit the Company's Web site at www.biovail.com.

For further information, please contact Ken Howling at 905-286-3000 or send inquiries to [e-mail].

"Safe Harbor" Statement Under the Private Securities Litigation Reform Act of 1995

To the extent any statements made in this release contain information that is not historical, these statements are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, 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 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, tax rate assumptions, availability of raw materials and finished products, the regulatory environment, the outcome of legal proceedings, 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. Biovail undertakes no obligation to update or revise any forward-looking statement.