NEW YORK, Nov. 14, 2003 (PRIMEZONE) -- Wolf Popper LLP has filed a securities fraud class action complaint against Biovail Corporation (NYSE:BVF) and two of its senior officers on behalf of purchasers of Biovail common stock from April 29, 2003 through November 10, 2003, inclusive. A copy of the complaint is available from the U.S. District Court for the Southern District of New York, and on Wolf Popper's website (www.wolfpopper.com).
Plaintiff alleges that the defendants misrepresented Biovail's business conditions and financial results by failing to disclose that (a) the marketing strategy for Biovail's main product, Cardizem LA, was based on an improper marketing program that attempted to artificially create demand and generate sales for the drug by using significant monetary payments of up to $1,000 each to induce physicians to prescribe the drug; (b) the marketing program involved material risk of regulatory scrutiny which could, and did, subsequently force Biovail to curtail or terminate the program following an inquiry from U.S. regulators; (c) the curtailment or termination of the marketing program would, and did, materially and adversely impact Biovail's earnings, because Biovail already incurred significant selling, general and administrative ("SG&A") expenses in connection with a rapid expansion of its U.S. sales force and advertisement and sales promotion for the program -- but was unable to generate sales revenue from Cardizem LA to keep pace with the incurred and rising SG&A costs due to the discontinuation of the program; and (d) financial arrangements and transactions entered into by Biovail with Athpharma Limited, Pharma Pass II, LLC and Ethypharma S.A. to minimize research and development expenses, would result in more than $18.4 million of impact against earnings when fully reflected on Biovail's income statement.
The true facts were partially revealed to the market on October 30, 2003, when Biovail issued a press release announcing its financial results for the third quarter of 2003. In the press release, the defendants disclosed that (a) Biovail's SG&A expenses were significantly higher than previously stated; (b) Biovail's research and development expenses increased to $20.6 million; (c) Biovail incurred a massive $18.4 million charge against its earnings because of the Pharma Pass II and Ethypharm transactions, reducing Biovail's earnings per share for the third quarter of 2003 to $0.08.
Biovail's disclosure of the true facts caused its common stock price to drop by $3.41 or 12.7% to close at $23.40 on October 30, 2003. Previously, the price per share of Biovail common stock had already decreased by $6.67 or 17.7% to close at $31.10 on October 3, 2003. During the class period, Biovail common stock traded as high as $51.30 per share.
Any member of the class (who purchased Biovail common stock during the period April 29, 2003 through November 10, 2003) who desires to be appointed lead plaintiff in the class action must file a motion with the Court no later than January 12, 2004. Class members must meet certain legal requirements to serve as a lead plaintiff. If you have questions or information regarding this action, or if you are interested in serving as a lead plaintiff, you may call or write: Wolf Popper LLP, Robert C. Finkel, Esq. 845 Third Avenue, New York, NY 10022-6689 Tel.: 212.451.9620, Toll Free: 877.370.7703; Fax: 212.486.2093, Toll Free: 877.370.7704 Email: irrep@wolfpopper.com; website: www.wolfpopper.com
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca