Biovail posted operating income of $61m for the quarter, a significant improvement on the 2006 figures which showed a loss of over $50m. This in turn translates to operating income for the year-to-date of just over $222m, up on last year's $119.3m.
Revenues however, have been hit hard by decreased sales of the company's Wellbutrin XL (bupropion) antidepressant, the result of generic competition for the 300mg dose that entered the market in December last year.
Wellbutrin XL revenues for the quarter were down a gut churning 57 per cent on last year to $53.5m, with revenues for first nine months of the year 44 per cent down on last year to a fraction under $168m.
With Biovail already suffering from generic competition for the 300mg dose, the company has taken steps to limit the damage to its coffers by entering into comprehensive settlement agreements with a number of generics companies to stave off the introduction of generic versions of the 150mg dose as long as it can.
Under the terms of the agreement, Biovail has managed to delay potential introduction of a generic version until the end of May 2008. However, this stay of execution could vanish if certain events occur, including a negative decision in a court appeal to overturn a previous non-infringement ruling in favour of Anchen Pharmaceuticals.
"The comprehensive settlements entered into by Biovail…has mitigated the otherwise significant impact the loss of market exclusivity would have had on our financial and operational performance in 2007," CEO Douglas Squires said during the company's conference call yesterday.
Aside from the clear financial benefits the deal will have on the company's 2007 figures, Squires also noted that the settlement could also provide a window of opportunity for the firm to maximise the market potential of one of lead product candidates, BVF-033.
BVF-033 is a new bupropion salt product designed as a once daily antidepressant with a safety profile superior to Biovail's established Wellbutrin XL treatment. The firm has high hopes for the product, not least of all to help mitigate the generic erosion of the current Wellbutrin franchise.
Original plans were to have the product launched during the fourth quarter of this year, but back in July the company was forced to reassure shareholders after receiving a non approval letter from the US Food and Drug Administration (FDA).
Just over two weeks ago the company submitted its complete response to the FDA, including new analyses of existing information but no new data. As yet the company has not heard back from the agency, though Squires said the firm believes the submission warrants a Class I designation.
Biovail maintains that it is still on track to be able to launch the product early next year, and is currently in late-stage partnership discussions.
The company's pain treatment Ultram ER (tramadol), launched last February, recorded third quarter sales 26 per cent down on last year, with the drop to $13.8m due to lower inventory levels at marketing partner Ortho-McNeil and the backorder of certain lots.
Ultram revenues for the year-to-date, however, were up 83 per cent on last year to $63.3m (partly thanks to a price hike), and over the third quarter the product captured 6.2 per cent of total prescription volume for the tramadol market.
Biovail's total product revenues for the quarter were down 34 per cent, primarily due to the Wellbutrin and Ultram losses, but also a 33 per cent drop in generics sales. The firm managed $178.3m in sales, contributing to $607m for the year-to-date (16 per cent down on last year.)
Looking forward, Biovail has maintained its 2007 guidance of total revenues around the $800-$850m mark and cash flow from operations of $320-$340m. This, however, is based on the assumption that no generic versions of the 150mg Wellbutrin treatment are launched during the remainder of the year.
