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The Concerned Shareholders of Biovail Say Biovail Has Misled Shareholders

    Shareholders are Urged to Vote their YELLOW proxy, FOR the Election of
    Two Highly Qualified and Independent Directors to the Biovail Board

TORONTO, May 15 /PRNewswire/ - The Concerned Shareholders of Biovail today said that Biovail Corporation (NYSE: BVF) (TSX:BVF) continues to mislead its shareholders by making the focal point of this dispute Mr. Melnyk.

The requisition was simply about governance reform and has already been a catalyst to governance improvements at Biovail (as evidenced by the reforms recently announced by Biovail) and provides shareholders with an opportunity to elect two highly qualified and independent directors (who have never met Mr. Melnyk). Mr. Haggis and Mr. Potter were selected as a result of the culmination of a professional search conducted entirely without Mr. Melnyk's influence. Both nominees have records consisting of significant accomplishments and whose "business experience and ethics" cannot be questioned as noted by Biovail.

It should be evident to shareholders that, as opposed to Biovail's surprisingly combative approach to the requisition, the requisition was not intended to cause and should not have caused such a dramatic and costly reaction by Biovail. The Concerned Shareholders have not attacked Biovail's strategy, its management or members of the incumbent Board. The Concerned Shareholders have remained silent regarding the dramatic dividend cut announced by Biovail on May 6, 2009. As has been stated, this is not about Mr. Melnyk or about a confrontation; this is about improving Biovail for all shareholders.

Biovail shareholders on May 28, 2009 will have an opportunity to make a difference with respect to the company that they have invested in.

Shareholders will have the opportunity to improve the governance of Biovail by electing Mr. Paul G. Haggis and Mr. Frank Potter to the board of directors of Biovail. Mr. Haggis and Mr. Potter are two highly qualified and independent directors with strong financial and corporate governance backgrounds who will provide Biovail's Board with a new vantage point and with two directors unencumbered by the recent trials and tribulations at Biovail.

As has been previously stated by the Concerned Shareholders, the overriding emphasis of the current requisition is an improved Biovail, which includes a greater respect for corporate governance and an improved board of directors better equipped and aligned to create value for all shareholders.

The Board and management of Biovail continue to miss the point with respect to the purpose of the requisition which is exemplified by the following:

    Mr. Haggis and Mr. Potter - Proven Experience, a Respect for Governance
    and Independence from Management and Biovail's Largest Shareholder

The Concerned Shareholders are in agreement with one aspect of the recent press release and letter to shareholders issued by Biovail: Mr. Haggis and Mr. Potter have had notable careers and their business experience or ethics cannot be questioned. However, the Concerned Shareholders strongly disagree with the recent assertion that "neither of them fill a gap or satisfy a need in the current Board." This could not be further from the truth.

    -   If elected, Mr. Haggis and Mr. Potter would be independent actors on
        the Board who owe nothing to management or the Concerned Shareholders
        and they would bring a fresh vantage point to Board deliberations.

    -   They would also be unencumbered by Biovail's history which has
        included investigations by securities regulators, class action
        lawsuits (relating to timeframes with which current members of the
        Board were involved) and disputes with Biovail's founder.

    -   Their addition to the Board would logically assist with Biovail's new
        direction and path forward.

Clearly these are needs and gaps on the Board that need to be addressed and they would be addressed by the addition of Mr. Haggis and Mr. Potter.

With respect to corporate governance, the incumbent Board relies upon the recent governance reforms, adopted in the face of a proxy fight, as demonstrating that all is fine. However, the Concerned Shareholders point to these recent reforms as validating their belief that improvements were and continue to be necessary. If elected, Mr. Haggis and Mr. Potter would bring a practical and genuine commitment to corporate governance and executive compensation at Biovail, a need which also fundamentally needs to be addressed.

Regarding Mr. Haggis and Mr. Potter Biovail has recently stated "they have no experience in the pharmaceutical industry, or with Biovail's New Strategic Focus" and "they appear to have limited business experience in the United States."

One must fairly point out that these issues do not seem to be a concern for Biovail in nominating Sir Louis Tull for election to the Board at this year's meeting. Sir Louis Tull apparently has no (or limited) experience in the pharmaceutical industry and apparently has no business experience in the United States.

With respect to Mr. Haggis' and Mr. Potter's experience in the United States (i) Mr. Potter served for nine years at the The World Bank in Washington and has a wealth of international business experience and (ii) Mr. Haggis worked for both MetLife and Citibank where he travelled frequently to the United States and from 1993 to 1995 he was part of MetLife's Strategic Research Group ("SRG") where he worked out of MetLife's headquarters on Madison Ave. in New York while living in New Jersey. The SRG was responsible for MetLife's worldwide initiatives, although at the time it was primarily focused on U.S. issues, including health care. This experience can hardly be characterized, as Biovail would lead shareholders to believe, as limited business experience in the United States.

With respect to Biovail's corporate governance standards, the Concerned Shareholders believe that if elected Mr. Haggis and Mr. Potter would satisfy these requirements relating to "interlock" board memberships as, if elected, they would only serve on the Board of one other public company together.

    Shareholder Democracy Concerns - Biovail's Position is Opposed to Proper

Biovail has recently and irresponsibly claimed that the Concerned Shareholders have attempted to frustrate shareholder democracy at Biovail. This is further evidence of the Board's and management's poor judgment and misguided view of governance. Their claim flies in the face of governance principles and is simply untrue.

    -   The Concerned Shareholders have, unlike Biovail, afforded
        shareholders with the ultimate form of shareholder democracy with
        respect to the election of directors - the ability to vote for the
        eleven director nominees of their choice.

    -   There are thirteen individuals being nominated in total for eleven
        places on the Board. The Concerned Shareholders are providing Biovail
        shareholders with the ability to choose the eleven of the thirteen
        nominees they feel are best suited to lead their company.

    -   By limiting the form of proxy to eleven director nominees, as Biovail
        has done, the Concerned Shareholders would have frustrated a
        shareholders ability to elect the directors of their choice. This
        would have been patently unfair and against proper governance

Unfortunately, a technical difficulty beyond the control of the Concerned Shareholders has caused the issue with respect to the unavailability of telephone and internet voting which is a detriment to shareholders and applies equally to both the Concerned Shareholders and Biovail.

This situation is not unprecedented in Canadian proxy contests and the Concerned Shareholders had on several occasions asked Biovail how the election of directors would be handled at the meeting but were rebuffed by Biovail on each occasion. The Concerned Shareholders would have preferred to avoid a proxy contest for the election of directors.

It should be noted that upon being advised of the technical shortcoming, the Concerned Shareholders made a significant effort to have the issue corrected and they explored other voting alternatives for shareholders to no avail. The Concerned Shareholders hope that this technical shortcoming is quickly addressed for future situations.

The Governance Resolutions

The Board and Management of Biovail have wasted countless pages and costly hours attacking the resolutions set out in the February 25, 2009 requisition.

    -   Biovail has implicitly acknowledged that indeed there were governance
        shortcomings as evidenced by the adoption of, on the eve of
        finalizing its proxy circular, key features of the reforms outlined
        by the Concerned Shareholders in the resolutions, being (i) majority
        voting, (ii) shareholder approval of dilutive transactions and (iii)
        double-trigger employment agreements.

    -   Had Biovail intended to implement these reforms, why did they wait
        until April 30, 2009 to make these announcements instead of
        approaching the Concerned Shareholders to see if a compromise could
        have been agreed upon?

    -   Upon the announcement of these reforms the Concerned Shareholders
        were satisfied that those resolutions had served their purpose and
        they announced they would no longer proceed forward with the
        proposals - a compromise would have been likely had Biovail taken a
        reasonable approach with respect to the requisition while considering
        the interests of its shareholders.


Biovail's continued irrational attacks on the Concerned Shareholders and the requisition should demonstrate that the current Board in unable to operate constructively and is unable to embrace an opportunity to strengthen the Board to better position Biovail for its path forward. A change is needed to, at a minimum, correct this one of many concerns at Biovail. Biovail needs to shed its past and focus on the real challenges of the future. Challenges that can be best served by having positive relationships with its stakeholders and the best possible Board representation. Both Biovail and the Concerned Shareholders agree that Mr. Haggis and Mr. Potter's credentials and ethics are unquestionable, the Concerned Shareholders therefore ask that shareholders support the election of Mr. Haggis and Mr. Potter to the Board.

Please ensure you vote your YELLOW proxy today FOR the election of Mr. Paul G. Haggis and Mr. Frank Potter as directors of Biovail at the annual and special meeting of shareholders to be held on May 28, 2009. Copies of the proxy circular prepared and filed by the Concerned Shareholders can be obtained via SEDAR ( or by contacting Laurel Hill Advisory Group toll-free at 1-888-882-6742 or if outside North America at 416-637-4661 (collect calls accepted).

TIME IS SHORT: Biovail shareholders are encouraged to contact Laurel Hill Advisory Group toll-free at 1-888-882-6742 or if outside North America at 416-637-4661 (collect calls accepted) with any questions or if they require assistance voting their YELLOW form of proxy. If you support Mr. Haggis and Mr. Potter you must act quickly to complete the appropriate documents. If you support Mr. Haggis and Mr. Potter you should vote using only the YELLOW form of proxy accompanying the proxy circular and disregard any other form of proxy.

YELLOW proxies must be received by Laurel Hill Advisory Group by no later than 2:00 p.m. (Toronto time) on May 25, 2009 in order to be voted at the meeting. Even if you have voted the management proxy and wish to change your vote, simply vote again using the YELLOW proxy, a later dated proxy will automatically revoke the previously submitted proxy.

Certain statements contained in this release constitute forward-looking statements. The words "may", "would", "could", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" and similar expressions as they relate to the Concerned Shareholders, the Nominees, the Company or its current or future management, are intended to identify forward-looking statements. Such statements reflect the Concerned Shareholders' or the Nominees' current views with respect to future events and are subject to certain risks, uncertainties and assumptions. The Concerned Shareholders and the Nominees assume no responsibility for any such statements. Many factors could cause the company's actual results, performance or achievements that may be expressed or implied by such forward-looking statements to vary from those described herein should one or more of these risks or uncertainties materialize. Such factors include, but are not limited to, economic, business, technological, competitive and regulatory factors. All such factors should be considered carefully when making decisions with respect to Biovail, and undue reliance should not be placed on the Concerned Shareholders' or the Nominees' forward-looking statements. The Concerned Shareholders and the Nominees do not undertake to update any forward-looking statements, whether written or oral, that may be made from time to time by or on their behalf, except as required under applicable securities legislation.

SOURCE Concerned Shareholders of Biovail
Copyright©2009 PR Newswire.
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