* Biovail to spend $130 mln on research and development
* Biovail shares up 1.1 percent at C$15.45
* Labopharm sees launch of trazodone in Q3
* Labopharm shares down 2.5 pct at C$1.55
(In U.S. dollars unless noted)
By Scott Anderson
TORONTO, Feb 25 Two Canadian drugmakers,
Biovail Corp BVF.TO BVF.N and Labopharm Inc DDS.TO
DDSS.O, said on Thursday they plan to spend more on new drug
launches this year as they reported quarterly results.
Biovail, Canada's biggest publicly traded drugmaker, said
its 2010 earnings per share would be below 2009 levels, while
revenue growth would be modest as it spends more on drug
development and marketing.
The company has been focusing on treatments for the central
nervous system for the past two years.
"Naturally as you increase expenses to invest for the
future, it means that it will depress results," said Biovail
Chief Executive Bill Wells. "All the programs are moving ahead
simultaneously and, of course, it implies additional costs."
The Toronto-based company will spend about $130 million on
research and development not including upfront or milestone
payments in 2010 as it continues to push a number of treatments
for conditions such as Parkinson's disease psychosis and
schizophrenia to late stage trials. In 2009, it spent $120.8
million on R&D which included upfront payments.
"The company is making a significant investment for the
future in 2010," RBC Dominion Securities analyst Doug Miehm
said in a note.
"These are investments that will ultimately lead to a more
valuable company and as such we continue to believe a
successful central nervous system strategy should ultimately
lead to an expansion in Biovail's multiple."
It also plans develop a U.S. sales team for its treatment
for agitation in patients with schizophrenia or bipolar
Biovail signed a collaboration deal with Alexza
Pharmaceuticals Inc ALXA.O two weeks ago to develop and
commercialize the inhaled treatment in the United States and
Canada. It expects to receive U.S. approval for the product in
Small Montreal-based Labopharm also expects to spend more
money this year as it moves ahead with the launch of its
once-daily trazodone antidepressant in the United States.
The U.S. Food and Drug Administration approved the
treatment earlier this month and Labopharm expects to launch it
under the name Oleptro on the U.S. market in the third
"We have invested a considerable amount of time and effort
to understand our physician and patient audiences, and are in
the process of finalizing a commercial strategy, including
positioning, market access and distribution," Labopharm
President James Howard-Tripp said in a news release.
Labopharn reported a fourth-quarter loss on Thursday that
was in line with analyst estimates, but sales fell short of
expectations due to light licensing revenue.
Its loss narrowed to C$6.4 million, or 11 Canadian cents a
share, from C$14.6 million, or 26 Canadian cents a share, a
year earlier. Revenue rose to C$6.7 million, but licensing
revenue was flat at C$1.2 million.
Analysts on average had expected Labopharm to report a loss
of 11 Canadian cents a share and revenue of C$7.5 million,
according to Thomson Reuters I/B/E/S.
Labopharm's shares were down 2.5 percent at C$1.55 in
afternoon trade on Thursday.
Profit at Biovail fell due to a series of one-time items
but was still higher than the market had expected.
Biovail earned $73 million, or 46 cents a share, in the
fourth quarter, ended Dec. 30, down from a year-earlier profit
of $120.4 million, or 76 cents a share. In the fourth quarter
of 2008 the company's results were lifted by a $66.2 million,
or 42 cents per share, deferred income-tax benefit.
Excluding one-time items, earnings in the latest quarter
were 56 cents a share. Revenue rose 33 percent to $241.1
Analysts on average had expected earnings of 40 cents a
share and revenue of $223.6 million, according to Thomson
Biovail's shares were up 1.1 percent at C$15.45 on the
Toronto Stock Exchange on Thursday.
(Additional reporting by Arnika Thakur in Bangalore; editing
by Peter Galloway)