Business Wire - Biovail Reports Second-Quarter 2006 Financial Results; Company Records Total Revenues of $253 Million; U.S. GAAP EPS of $0.50; Cash Balances in Excess of $570…
TORONTO — Biovail Corporation (NYSE:BVF)(TSX:BVF) today announced financial results for the three-month and six-month periods ending June 30, 2006. To the extent that this news release contains forward-looking statements, investors are cautioned that these are based on the Company’s current views, and actual outcomes are not certain. For more information, see the note on forward-looking information following the conference call details in this news release.
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Total revenues for the three months ended June 30, 2006 were $252.8 million, compared with $216.2 million for the second quarter of 2005. Total revenues for the six months ended June 30, 2006 were $473.3 million, compared with $389.9 million for the first six months of 2005. Second-quarter 2006 net income, in accordance with United States Generally Accepted Accounting Principles (GAAP), was $80.6 million, compared with $3.7 million for the corresponding 2005 period. GAAP diluted earnings per share (EPS) for the second quarter of 2006 were $0.50, compared with $0.02 for the second quarter of 2005. In the first half of 2006, GAAP EPS were $0.91, compared with EPS of $0.09 for the first half of 2005. In the second-quarter of 2006, GAAP net income and EPS figures were impacted by costs associated with a recall of certain dosage strengths of Ultram(R) ER, which negatively impacted 2006 U.S. GAAP pre-tax income and EPS by $13.4 million and $0.08, respectively. In the first half of 2006, Biovail also incurred a $2.3-million write-down related to the sale of Nutravail to Futuristic Brands USA, Inc. In the second quarter and first half of 2005, GAAP net income and EPS figures were impacted by the restructuring of Biovail’s U.S. commercial operations, a write-down of assets primarily associated with the sale of Teveten and Teveten HCT to Kos Pharmaceuticals, Inc., and a $4.9-million write-off of Cardizem(R) LA and Teveten inventories not purchased by Kos. These items negatively impacted first-half 2005 U.S. GAAP net income and EPS by $50.1 million and $0.31.
“Biovail has again delivered a financially strong quarter, and has ended the period with over $570 million in cash on hand,” said Biovail Chief Executive Officer Dr. Douglas Squires. “Although we are disappointed by recent litigation developments, we remain committed to vigorously defending Wellbutrin XL(R). The filing of a Motion for Reconsideration with the Court is the likely first step; however, we will pursue any and all appropriate means to defend the integrity of our intellectual property.”
Update on Wellbutrin XL(R) Litigation
On August 1, 2006, in the United States District Court for the Central District of California, Judge James V. Selna issued an order granting Anchen Pharmaceutical Inc.’s (Anchen) Motion for Summary Judgment in the Wellbutrin XL(R) patent-infringement case, and denied it with respect to the invalidity issue. This ruling becomes final only after the Court has formally issued and entered a Final Judgment.
New Co-Promotion and Promotion Agreements
In the second quarter of 2006, Biovail further leveraged its existing sales and marketing infrastructure in both the U.S. and Canada. In May, Biovail’s wholly owned U.S. subsidiary, Biovail Pharmaceuticals, Inc. (BPI), and AstraZeneca Pharmaceuticals LP entered into an agreement pursuant to which BPI’s specialty sales force began promotional activities for Zoladex(R) 3.6mg (goserelin acetate implant) to obstetricians and gynecologists for the treatment of endometriosis in the United States and Puerto Rico. The BPI sales force now details Zovirax(R) Ointment and Zovirax(R) Cream, Ultram(R) ER and Zoladex(R) 3.6 mg to specialist physicians in the U.S.
Also in May, Biovail Pharmaceuticals Canada (BPC), the Company’s Canadian sales and marketing division, entered into an agreement with Novartis Pharmaceuticals Canada Inc. to market and promote cholesterol medicines Lescol(R) (fluvastatin sodium capsules), and once-daily Lescol(R) XL (fluvastatin sodium extended-release tablets), to Canadian specialists and primary-care physicians. These medicines are complementary to BPC’s existing product offerings, including Tiazac(R) XC and Glumetza(TM).
Second-Quarter 2006 Financial Performance
Product revenues for the second quarter of 2006 were $241.1 million, compared with $204.5 million in the second quarter of 2005, a 18% increase that reflects the performance of Wellbutrin XL(R) and Zovirax; partially offset by declines in revenues from BPC, Cardizem(R) LA, and Biovail’s portfolio of Legacy and generic products. Product revenues for the six months ended June 30, 2006 were $450.8 million compared with $365.1 million for the six months ended June 30, 2005.
Product revenues for Wellbutrin XL(R) were $114.0 million in the second quarter of 2006, and $179.0 million in the first half of 2006, compared with $70.5 million and $107.2 million in corresponding periods in 2005, respectively. This strong performance reflects continued strength in prescription volume for the product, as well as price increases instituted by GlaxoSmithKline (GSK). In June 2006, Wellbutrin XL(R) captured 60.5% of the new prescriptions written for the Wellbutrin brand (including generics).
