Biovail Reports Fourth Quarter, Year-End 2005 Financial Results

Business Wire, March 23, 2006

TORONTO -- Biovail Corporation (NYSE:BVF)(TSX:BVF):

--Company Achieves Record Revenues of $288 Million in Fourth Quarter, $936 Million in Full-Year 2005;

--U.S. GAAP EPS of $0.75 in Fourth Quarter, $1.48 in Full-Year 2005;

--Record Cash Flows From Operations of $223 Million in Fourth Quarter, $502 Million in Full-Year 2005

Biovail Corporation (NYSE:BVF)(TSX:BVF) today announced financial results for the three-month and 12-month periods ending December 31, 2005. To the extent that this press release contains forward-looking statements, investors are cautioned that these are based on our current views, and actual outcomes are not certain. For more information see the note on forward-looking information following the conference call details below.

Total revenues for the three months ended December 31, 2005 were $287.6 million, compared with $275.4 million for the fourth quarter of 2004, an increase of 4%. Total revenues for the 12 months ended December 31, 2005 were $935.5 million, compared with $879.2 million for the full year of 2004, an increase of 6%. Fourth-quarter 2005 net income, in accordance with United States Generally Accepted Accounting Principles (GAAP), was $119.7 million, compared with $46.0 million for the corresponding 2004 period. For the 12 months ended December 31, 2005, net income was $236.2 million, compared with $161.0 million for the same period a year earlier. GAAP diluted earnings per share (EPS) for the fourth quarter of 2005 were $0.75, versus $0.29 for the fourth quarter of 2004. In the full year of 2005, GAAP EPS were $1.48, versus EPS of $1.01 for the full year of 2004.

GAAP net income and EPS figures for the fourth quarter of 2005 were negatively impacted by a charge related to the write-down of the Company's investment in Reliant Pharmaceuticals, which negatively impacted net income by $2.7 million and EPS by $0.02. GAAP net income and EPS figures for the full year of 2005 were impacted by a restructuring charge, an equity loss in the Company's investment in Western Life Sciences, a non-cash write-down of assets and the write-off of inventory related to the transaction with Kos Pharmaceuticals, Inc. in May 2005 (see Specific Items Affecting Operations for details). These items negatively impacted 2005 GAAP net income and EPS by $60.6 million and $0.38, respectively. In 2004, net income and EPS figures were impacted by an acquired research-and-development charge associated with the acquisition of the remaining interest in BNC-PHARMAPASS, a write-off of the Rondec product rights, a write-down of Biovail's investment in Ethypharm, an equity loss in the Company's investment in Western Life Sciences and a gain on the sale of Cedax. These items negatively impacted 2004 EPS by $0.34.

"Biovail's record level of operating cash flows in the fourth quarter and full-year 2005 has further solidified the Company's financial position," said Biovail Chief Executive Officer Dr. Douglas Squires. "Given our strong base business, which has been further enhanced by the recent launch of Ultram(R) ER, we are well positioned to execute our long-term growth strategy. To this end, we are actively evaluating a number of complementary product and company acquisition opportunities."

Strategic Alliance for Tramadol

In November 2005, Biovail announced that it had entered into a supply agreement with Ortho-McNeil, Inc., a Johnson & Johnson company, for the marketing and distribution of Biovail's once-daily, extended-release formulation and an orally disintegrating, immediate-release formulation of tramadol in the United States. On February 21, 2006, Ortho-McNeil and Biovail's specialty sales force formally launched the once-daily formulation to U.S. physicians under the brand name Ultram(R) ER. Under the agreement, which has a 10-year term, Biovail will manufacture and supply Ultram(R) ER to Ortho-McNeil for distribution at contractually determined prices, which will be based on Ortho-McNeil's net selling price. Biovail anticipates the commercial launch of Ultram(R) ODT in the coming weeks. For more details, see the news release issued November 3, 2005, Biovail Enters Into Commercial Alliance for Tramadol Products.

Citizen Petition

In the fourth quarter of 2005, Biovail submitted a Citizen Petition to the United States Food and Drug Administration (FDA) to require rigorous bioequivalence testing for generic products that reference Wellbutrin XL(R) before they can be approved. Biovail took this step to protect patients against potentially serious risks (particularly seizures) which are currently disclosed in the approved Wellbutrin XL(R) labeling, and to ensure that generic versions of Wellbutrin XL(R) are as safe and effective as the innovator product.

Wellbutrin XL(R) Litigation

Biovail believes that the intellectual property that protects Wellbutrin XL(R) has been infringed by the four companies seeking FDA approval for generic formulations of a once-daily bupropion (Anchen Pharmaceuticals, Abrika Pharmaceuticals, Impax Laboratories and Watson Pharmaceuticals), and is actively pursuing ongoing litigation against each company.