Healthy Skepticism Library item: 10102

Warning: This library includes all items relevant to health product marketing that we are aware of regardless of quality. Often we do not agree with all or part of the contents.

Publication type: news

SEC mulls action against Biovail execs
Associated Press 2007 May 16
http://www.businessweek.com/ap/financialnews/D8P5EAC00.htm

Full text:

Specialty pharmaceutical company Biovail Corp. said late Tuesday company executives, including its chairman and chief financial officer, received “Wells Notices” from the Securities and Exchange Commission of possible civil enforcement action against them.

The notices, received by Chairman Eugene Melnyk and Kenneth Howling, senior vice-president and CFO, are in addition to the Wells Notice received by Biovail earlier this week alleging violations of federal securities laws in its accounting and disclosure practices.

A Wells Notice signifies the SEC has made a preliminary decision to recommend civil action against a company or an executive. A recipient of a Wells Notice can make a written submission before the staff makes a formal recommendation to the SEC on whether any action should be brought forth.

The SEC will recommend enforcement action against Melnyk over his trading and reporting ownership positions of Biovail securities, while the allegations against Howling concern his role while managing the company’s communications and investor relations.

Toronto-based Biovail also said the SEC will be issuing a similar notice to a former CFO and another current executive, neither of whom the company named.