VIAGRA NEWS

Source: Canada.com

Date: 9-Aug-2007

TORONTO - Biovail Corp. said Wednesday it plans to develop a raft of new drugs, including one to treat sexual dysfunctions, in a bid to counter sliding revenue caused by the introduction of generic competition to its antidepressant Wellbutrin XL.

The company announced the development deal for the sexual-dysfunction drug, along with second-quarter earnings of $68 million US, down 20 per cent from $85 million a year earlier.

Revenue of $203 million was down 20 per cent $255-million in the second quarter of last year.

We have multiple other discussions ongoing, and we expect to have at least one and probably a few more similar type deals done by the end of the year," CEO Doug Squires said.

Both the company and analysts who cover it expected the drop in earnings and revenue this year, as the effect of competition from generic versions of Wellbutrin began to kick in.

"We had a very good quarter, we met our expectations and exceeded the consensus of analysts that look at the company," said Squires. "No debt, strong cash flow. A very good quarter."

At mid-afternoon, Biovail shares were down 7.1 per cent to $18.25 on the Toronto Stock Exchange.

Meanwhile, the company is still waiting to gain Federal Drug Administration approval for its new salt version of Wellbutrin. On July 20, the FDA sent the company a non-approval letter, taking issue with the design of the laboratory studies required to support the application for the new drug. The FDA decision delayed the launch of the drug - which some observers say could add up to $100-million to annual sales - originally scheduled for the fourth quarter of this year.

The company will meet with the regulatory agency on Tuesday to discuss its decision, and management remains confident the product will win approval.

"We feel we have compelling scientific and regulatory arguments that the product should be approved," said Squires. "The issue is that it just takes time, and our time is limited to maximize the commercial potential of the product."

If the FDA refuses to budge from its stance, he said the company would look at redesigning the study or appealing the decision.

As for the deal announced Wednesday, the company said it has entered into a license-and-development agreement with a privately held drug-development company for global rights to BVF-324, described as "a novel product for the treatment of a prevalent sexual dysfunction."

Mr. Squires said he could not elaborate on what kind of sexual dysfunction the drug would treat, but that more information would be forthcoming once the company discusses its development with the FDA.

He said the new drug would "not necessarily compete" with well-known sexual dysfunction drugs on the market now, such as Viagra, but would "be very well positioned to do extremely well commercially because it's going to be perceived as very valuable."

The company also announced a quarterly cash dividend of US$0.375 per share.