Biovail, Melnyk continue battle for shareholder support at annual meeting on June 25

By Lisa Kerner

Charlotte, N.C., June 10 - Biovail Corp. and its founder continued to wage their proxy battle, reaching out to shareholders via letter and through the dissident shareholder's betterbiovail.com web site.

In a June 9 letter to shareholders, Eugene Melnyk, a former Biovail chief executive officer, said the company is attacking him in order to distract shareholders from the real issues - namely, the track record of the incumbent director nominees and their "lack of experience and lack of a thoughtful plan."

Melnyk went on to highlight the benefits he believes a new board of directors would bring as well as a new management team led by another former Biovail CEO, Bruce Brydon.

In addition, Melnyk reiterated that he is retired and is not coming back to join the Toronto specialty pharmaceutical company's board or management.

Biovail fired back, once again asking shareholders to disregard what it described as Melnyk's latest efforts to take control of the company and to vote for Biovail's "experienced and independent" board members at the annual meeting on June 25.

"The fact is that Biovail is already better - a far better company in terms of strategic direction and corporate governance - than it was when Eugene Melnyk was CEO," Biovail chairman Dr. Douglas Squires said in his latest letter.

It was previously reported that Squires and Biovail CEO William M. Williams said Melnyk was the problem the company is trying to solve.

On June 2, Melnyk and EM Holdings BV filed a dissident proxy circular in connection with their solicitation of proxies in support of their nominees: Bruce D. Brydon, Douglas N. Deeth, Joseph J. Krivulka, Vince M. Mazza, William J. Menear, Robert A. Podruzny, Liza A. Harridyal-Sodha, Mark L. Thompson, Dr. Lorne D. Tyrrell and Laurence W. Zeifman.

Biovail's nominees for election to the board, in addition to Squires and Wells, are:

• Lloyd Segal, CEO and director of Thallion Pharmaceuticals;

• Mark Parrish, former senior executive of Cardinal Health Inc.;

• Robert Power, former executive vice president of Wyeth Pharmaceuticals;

• Serge Gouin, chairman, Quebecor Media;

• Dr. Laurence Paul, Biovail director since 2002;

• David Laidley, former chairman of Deloitte & Touche;

• Spencer Lanthier, former chairman of KPMG Canada; and

• Michael Van Every, retired senior partner, PricewaterhouseCoopers and Biovail director.

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