Biovail founder Melnyk drops board battle

Mon Jul 28, 2008 1:25pm EDT
 
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By Scott Anderson

TORONTO (Reuters) - Biovail Corp BVF.TO BVF.N founder Eugene Melnyk said on Monday he was abandoning his plan to oust the Canadian drugmaker's board of directors and elect his own team at Biovail's shareholders meeting next month.

Instead, Melnyk, Biovail's biggest shareholder, said he would proceed with alternate plans to develop his own private drug company, to be called Trimel Biopharma.

In a setback for Biovail last week, an Ontario judge ordered the company to reconvene its annual shareholders meeting, held on June 25. Biovail's slate won the overwhelming support of shareholders who voted, but the judge ruled that the vote had been taken improperly.

The reconvened meeting is scheduled to be held on August 8 in Toronto.

In trying to reassert control over Biovail at the June meeting, Melnyk had proposed a new emphasis on the company's product pipeline, including a return to "difficult to manufacture" generic drugs, as well as acquiring more products and technologies.

He said he had lost confidence in the board and wanted it replaced.

Biovail's current management wants to shut its manufacturing operations in Puerto Rico and shift the company's focus to new treatments for disorders of the central nervous system.

"Biovail has said that their new plan will return the company to greatness. As the company's largest shareholder, I hope they are right. It is time for excuses to stop and for them to perform," Melnyk said in a release on Monday.   Continued...

 
<p>Biovail founder Eugene Melnyk in Toronto, May 16, 2007. Melnyk said on Monday he was abandoning his plan to oust the Canadian drugmaker's board of directors and elect his own team at Biovail's shareholders meeting next month. REUTERS/Mark Blinch</p>