Depomed, Biovail Revise Partnership Agreement for Development, Commercialization of Glumetza(tm); Depomed to Have Rights for United States; Biovail to Have Rights for Canada.

MENLO PARK, Calif. & TORONTO -- Depomed, Inc. (NASDAQ:DEPO) of Menlo Park, California, and Biovail Corporation (NYSE:BVF)(TSX:BVF) of Canada today announced that the companies have reached a definitive agreement to revise the terms of their partnership agreement for the development and commercialization of Glumetza(tm), a once-daily, extended-release formulation of metformin hydrochloride (HCl) for the treatment of Type II diabetes.

Under the new agreement, Depomed will have the marketing and distribution rights to the 500mg and 1,000mg formulations of Glumetza(tm) in the United States. The New Drug Application (NDA) for the 500mg formulation of Glumetza(tm), which was approved by the United States Food and Drug Administration (FDA) in June 2005, will be transferred to Depomed. And Biovail, which last month launched Glumetza(tm) in Canada, has relinquished its option on metformin combination products utilizing Depomed technology, given its decision to not pursue this product.

Depomed President and Chief Executive Officer Dr. John W. Fara, said that Depomed is pleased with the outcome of this situation.

"I believe we have a mutually beneficial agreement which sets the stage for complementary promotion of both the 500mg and 1,000mg Glumetza(tm) products in Canada and the U.S. We have already begun an analysis of the best path to enter the U.S. markets with these tablets," said Dr. Fara. "Additionally, we will now evaluate the opportunity represented by our once-daily metformin-sulfonylurea combination tablet, on which we have completed formulation work."

Dr. Douglas Squires, Chief Executive Officer of Biovail Corporation, said that Biovail is equally pleased to have reached an amicable resolution to its contract dispute with Depomed.

"Biovail is pleased to bring the first once-daily metformin product to Canadian physicians and their patients," said Dr. Squires. "Type II diabetes effects 2.25 million Canadians and the incidence of this disease is growing at a rate of almost 3% per year."

No cash payments were made by either party.

As a result of the revised agreement announced today, Depomed has withdrawn its previously announced legal action against Biovail.

About Glumetza(tm)

Glumetza(tm) is a once-daily extended-release formulation of metformin HCl and is intended to control diabetes mellitus, a condition characterized by high levels of blood glucose resulting from defects in insulin secretion, insulin activity or both. Metformin is indicated for the control of hyperglycemia in metformin-responsive, stable, mild, non-ketosis prone maturity onset type of diabetes (Type II) which cannot be controlled by proper dietary management, exercise and weight reduction and when insulin therapy is not appropriate.

About Diabetes

Diabetes affects an estimated 18 million Americans and is increasing by approximately one million new cases each year in the U.S. alone. Approximately 90% of diabetics suffer from Type II diabetes, the most common metabolic disease in the world and the fifth-deadliest disease in the U.S. Diabetes is the leading cause of blindness, end-stage renal disease and non-traumatic loss of limb and can also lead to heart disease, stroke, high blood pressure, kidney disease and other serious conditions. In the U.S., the public health cost of diabetes is more than $130 billion per year.

Diabetes affects an estimated 2.25 million Canadians, and is increasing in epidemic proportions by approximately 60,000 new cases each year in Canada alone. Approximately 90% of diabetics suffer from Type II diabetes, the most common metabolic disease in the world and the seventh-deadliest disease in Canada. Diabetes is the leading cause of blindness, end-stage renal disease and non-traumatic loss of limb, and can also lead to heart disease, stroke, high blood pressure and other serious conditions. In Canada, the public health cost of diabetes is estimated to be more than C$9 billion per year.

About Biovail Corporation

Biovail Corporation is a 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].

About Depomed

Depomed, Inc. is a specialty pharmaceutical company utilizing its innovative AcuForm drug delivery technology to develop novel oral products and improved, extended release formulations of existing oral drugs. AcuForm-based products are designed to provide once daily administration and reduced gastrointestinal side effects, improving patient convenience, compliance and pharmacokinetic profiles. Proquin(R) XR (ciprofloxacin hydrochloride) once daily, extended-release tablets have been approved by the FDA for the treatment of uncomplicated urinary tract infections. In addition, regulatory applications for once daily Glumetza(tm) (Metformin GR(R)) for the treatment of Type II diabetes have been approved in the U.S. and Canada. The company is also conducting a Phase II trial in post herpetic neuralgia with its product, Gabapentin GR. Additional information about Depomed may be found at its web site, www.depomedinc.com.

"Safe Harbor" Statement Under the Private Securities Litigation Reform Act of 1995. The statements that are not historical facts contained in this release are forward-looking statements that involve risks and uncertainties including, but not limited to those related to commercialization and research and development efforts, including pre-clinical and clinical testing; regulation by the FDA and other government agencies; the timing of regulatory applications and product launches; and other risks detailed in the company's Securities and Exchange Commission filings, including the company's Annual Report on Form 10-K. You are cautioned not to place undue reliance on these forward-looking statements which speak only as of the date hereof. The company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.