Biovail Acquires Vasotec-R / Vaseretic-R From Merck & Co., Inc

Business Wire, May 12, 2002

Business & Health/Medical Editors

TORONTO--(BW HealthWire)--May 12, 2002

Biovail Corporation (NYSE:BVF)(TSE:BVF)

-- Biovail to develop future life cycle products for Vasotec line

-- Biovail to apply Ceform(R) Microsphere Technology to Merck product under
development

Biovail Corporation (NYSE:BVF)(TSE:BVF) today announced that it has entered into definitive agreements with Merck & Co., Inc. (Merck) whereby Biovail has acquired U.S. rights to Vasotec(R) (enalapril) and Vaseretic(R) (enalapril with hydrochlorothiazide) for $155 million and semi-annual minimum payments pursuant to a 5 year supply agreement. Sales of Vasotec(R) / Vaseretic(R) in the U.S. were in excess of $125 million in 2001. Biovail also acquired the fixed dose combination New Drug Application (NDA) of enalapril in combination with diltiazem malate.

Biovail's acquisition of the Vasotec(R) / Vaseretic(R) product lines is effective April 1, 2002 and the company will begin recognizing the associated financial benefits from the U.S. sales of the franchise accordingly. The agreement calls for Merck to manufacture and supply Vasotec(R) and Vaseretic(R) to Biovail and to temporarily provide distribution services to Biovail under the terms of a Transition Distribution Agreement. Merck will receive royalties on the future sales of any life cycle products developed and marketed by Biovail in the U.S.

Biovail also announced that it has entered into a separate agreement with Merck to develop, license and supply a new dosage format of a Merck product under development. Utilizing Ceform Microsphere technology, Biovail will manufacture and supply this new dosage format technology to Merck for commercialization, subject to Food and Drug Administration (FDA) approval.

Eugene Melnyk, Chairman of Biovail, commented, "The acquisition of Vasotec(R) / Vaseretic(R) is another example of Biovail's commitment to building a strong cardiovascular presence in the U.S. market. This acquisition complements Biovail's currently marketed and development stage hypertension management product portfolios. By applying drug delivery technologies, Biovail is formulating enhanced versions of Vasotec(R) resulting in improved bioavailability, a better side effect profile and a novel dosing regime. Additionally, fixed dosage presentations of existing cardiovascular medications are an emerging option for hypertension therapy, providing patients already maintained on existing medications with convenient dosing options that further improve their compliance. Combination therapy for Vasotec(R) in conjunction with our Cardizem(R) franchise may give medical practitioners further prescribing options and should give Biovail added strength in the cardiovascular market.

Hypertension remains uncontrolled worldwide despite the availability of several classes of antihypertensive agents, including diuretics, alpha-blockers, beta-blockers, calcium channel blockers, angiotensin-converting enzyme (ACE) inhibitors, angiotensin receptor blockers (ARB's) and a variety of central-acting agents. There is no currently available monotherapy that consistently reduces blood pressure over a full range of population subgroups with hypertension.

Vasotec(R) and Vaseretic(R) are proven, effective and trusted first line agents for the treatment of hypertension and congestive heart failure. Based on past and current practices, ACE inhibitors will continue to be important agents in the treatment armamentarium for physicians for these conditions. Vasotec(R), a leading angiotensin converting enzyme (ACE) inhibitor, competes with a number of other cardiovascular drugs indicated for hypertension and symptomatic congestive heart failure. IMS data indicates that approximately 30% of all patients taking enalapril take their medication twice a day. Vaseretic(R) is a fixed-dose combination of Vasotec and hydrochlorothiazide, a diuretic that provides an additive anti-hypertensive effect.

Total market sales for ACE inhibitors in 2001, including combinations with hydrochlorothiazide, were in excess of $4.3 billion, with prescription volumes of nearly 114 million. Enalapril (brand and generic) represents the second most widely prescribed ACE Inhibitor with approximately 16 million prescriptions or 14% market share for the 12 months ended December 2001.

Biovail Corporation is a full-service pharmaceutical company, engaged in the formulation, clinical testing, registration, manufacture, sale and promotion of pharmaceutical products utilizing advanced drug delivery technologies.

"Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995.

To the extent any statements made in this release contain information that is not historical, these statements are essentially forward looking and are subject to risks and uncertainties, including the difficulty of predicting FDA 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, 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.