Not too late to Protect Your Investment and Vote for A Better Biovail
TORONTO, June 20 /PRNewswire/ - The Concerned Shareholders remind
fellow shareholders of Biovail that it is not too late to vote your YELLOW
proxy for a Better Biovail. It is more than clear that change is needed.
Industry experts, CIBC World Markets - Equity Research, have today changed
their recommendation for BVF to sector underperformer based on the proposed
strategy of the Company going forward proposed by the Incumbent Board and
According to CIBC, the reasons for this downgrade include:
(x) "Biovail's poor growth prospects, limited pipeline visibility and our
expectation for a long restructuring lead us to believe that Biovail
will underperform its peers going forward.
(x) In addition, we believe that Biovail's dividend policy is not
sustainable. We forecast declining cash flows and hold the view that
the company will need to use its cash to support distributions in the
near term. We would rather see the company preserve its capital for
(x) We also have modest expectations as it relates to Biovail's new focus
on Central Nervous System (CNS) disorders, as we view the clinical
development risks as relatively high and the existing market as
highly competitive. The CNS market is also highly genericized."
Furthermore, the report goes on to state that, "we believe the likelihood of a reduction or elimination of the dividend is quite high." CIBC wonders how "the company's current product portfolio will generate sufficient cash flows to support the payments given our impression that some of the company's products may be facing generic competition in the near term." Finally CIBC "fails to see how paying ~$240 million/year in dividends makes sense given the company's new strategy."
The Concerned Shareholders urge al
|SOURCE A Better Biovail|
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