Biovail Updates 2004 Financial Guidance.TORONTO -- 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 updated revenue and earnings guidance for 2004 following a comprehensive review of the Company's operations and projections. As a result of this review, Biovail is narrowing its revenue guidance from $800 million to $940 million to $820 million to $920 million and confirming its previous 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 (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. ) guidance of $1.35 to $1.60, excluding certain items. Biovail's updated product sales revenue guidance is based on a number of variables, including current prescription and business trends, as well as the buying patterns of wholesaler and distribution partners. Biovail's 2004 product sales guidance assumes wholesaler inventory levels will be at a range of one to two months, unless temporarily impacted by wholesaler buying patterns due to price increases or seasonality. Wellbutrin XL, Biovail's once-daily bupropion bupropion /bu·pro·pi·on/ (bu-pro´pe-on) a monocyclic compound structurally similar to amphetamine, used as the hydrochloride salt as an antidepressant and as an aid in smoking cessation. formulation which is sold under license by GlaxoSmithKline (GSK GSK GlaxoSmithKline plc (pharmaceutical company) GSK Glycogen Synthase Kinase GSK Gruppentraining Sozialer Kompetenzen (Germany) GSK Greenland Shark (FAO fish species code) ) in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , continues to trend materially above the Company's previous guidance, while the Company's Promoted products are tracking below previous guidance. Legacy products updated guidance reflects the recent termination of the Cedax distribution agreement, while the Company's updated Generic product revenue guidance considers current product trending and further improvement in this business. Biovail's product sales, research and development, royalty/co-promote and total annual revenue updated guidance ranges for 2004, compared with previous 2004 annual guidance ranges, reflects the variables described above and is detailed in the following chart: ($ millions) --------------------------------------------------------------------- Product Updated Previous --------------------------------------------------------------------- Cardizem LA 70 - 80 80 - 100 Teveten 20 - 25 30 - 40 Zovirax 75 - 80 90 - 110 --------------------------------------------------------------------- Promoted Products 165 - 185 200 - 250 Wellbutrin XL 275 - 300 200 - 250 Biovail Pharma Canada 100 - 110 100 - 120 Legacy 130 - 150 150 - 200 Generics 120 - 135 110 - 130 --------------------------------------------------------------------- Total Product Sales 790 - 880 760 - 950 R&D Revenue 10 - 15 10 - 15 Royalty/Co-Promote 20 - 25 20 - 25 --------------------------------------------------------------------- Total Revenue Guidance 820 - 920 800 - 940 --------------------------------------------------------------------- Biovail's 2004 total revenue guidance range has been narrowed as per the above chart to between $820 million and $920 million, compared with previous total revenue guidance of $800 million to $940 million. Updated guidance ranges for total revenue and Wellbutrin XL revenue, compared with previous guidance ranges is as follows:
($ millions)
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Q3 / 2004 Q4 / 2004 FY 2004
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Updated Guidance
Total Revenue 205 - 250 225 - 290 820 - 920
Wellbutrin XL 70-80 85 - 100 275 - 300
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Previous Guidance
Total Revenue 220 - 255 240 - 300 800 - 940
Wellbutrin XL 60-80 70 - 100 200 - 250
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Gross margins are expected to increase through the second-half of 2004 primarily due to product mix and the favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. impact of higher Wellbutrin XL pricing, among other items. Biovail's guidance for 2004 gross margins on product sales is 74% to 76%. Research-and-development expenses in the second-half of 2004 are expected to increase relative to first-half levels, and be in the range of $70 million to $85 million. The anticipated increase in spending reflects an increase in clinical activity, including the initiation of Phase III Noun 1. phase III - a large clinical trial of a treatment or drug that in phase I and phase II has been shown to be efficacious with tolerable side effects; after successful conclusion of these clinical trials it will receive formal approval from the FDA development for 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. CR. Biovail's product pipeline currently consists of over 25 development programs, and remains the Company's long-term growth engine. Selling, general and administrative expenses are also expected to increase in the second half of 2004 relative to first-half 2004 levels, due to the full deployment of Biovail's specialty and primary-care sales forces and the initiation of various marketing initiatives in support of the Company's promoted products. Selling, general and administrative expenses are forecast to be in the range of $260 million to $280 million for 2004. Amortization expenses for 2004 are expected to be in the range of $60 million to $65 million. The Company's tax rate is expected to be in the 4% to 5% range. Capital expenditures are expected to be in the range of $25 million to $40 million, and cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses is expected to be in the range of $200 million to $250 million. Biovail's diluted EPS guidance excludes certain items such as the 2004 first-quarter charge for acquired research and development and may exclude future items. Updated diluted EPS is expected to be in the $0.30-$0.40 range for third-quarter 2004 and $0.55-$0.75 for fourth-quarter 2004. Updated 2004 third-quarter diluted EPS reflects a number of items, including the impact of the recent termination of the Cedax distribution agreement. Fourth-quarter 2004 guidance reflects numerous assumptions including further improvements in our generics business, continued market penetration Noun 1. market penetration - the extent to which a product is recognized and bought by customers in a particular market penetration - the act of entering into or through something; "the penetration of upper management by women" of Wellbutrin XL and potential partnering opportunities; offset by further investment in growth initiatives. Depending on the timing of these items, full-year diluted EPS for 2004 is expected to be in the range of $1.35 and $1.60. The Company's diluted EPS guidance is based on a number of variables, including estimated revenues, expenses, wholesaler and distribution-partner buying patterns and inventory levels, gross margins, tax rate, number of shares outstanding and numerous other items. Attainment of the high end of the Company's diluted EPS guidance range assumes a number of variables, including achieving a high level of revenues, high gross margins, a relatively low level of expenses, further generic business improvements, continued market penetration of Wellbutrin XL, among other items. Achieving the low end of the Company's earnings guidance assumes minimum product sales revenue levels are met, low gross margins and a higher level of expenses. 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 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 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, 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 ("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. ") and Canadian 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) ") 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, third parties, the regulatory environment, fluctuations in operating results and other risks detailed from time to time in the company's filings with the Securities and Exchange Commission ("SEC") 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. ("OSC O.S.C. n. short for Order to Show Cause. (See: Order to Show Cause) "). |
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