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Canada Commission Probes Biovail Exec


Posted on 2006-07-31 14:20:00



Canadian pharmaceutical company Biovail Corp. said Monday that staff of the Ontario Securities Commission have filed administrative allegations against the company's chairman and former CEO, Eugene Melnyk, and a former Biovail director, among others.

In a filing available on the OSC website, staff of the Ontario Securities Commission allege that Melnyk violated disclosure and reporting regulations, and that former director Roger Rowan committed insider trading violations. A hearing to review the matter is scheduled for Sept. 21.

Biovail said its board and management team "express their continued confidence in Mr. Melnyk's ability to lead the corporation as chairman."

Separately, Melnyk issued a statement saying, "I have always conducted my personal and business affairs with the highest degree of honesty and integrity."

The OSC allege that Melnyk didn't fulfill certain reporting obligations concerning shares of Biovail owned by four trusts. In his statement, Melnyk asserted that he did not own the shares in question in the period after these trusts were established, and was never a trustee or beneficiary of the trusts.

"I disagree strongly with the contention of Staff that I exercised control or direction of the shares in question in the period after the Trusts were established, and with their assertion that I was required to file reports concerning these trades," said Melnyk.

The OSC is seeking penalties of up to $1 million Canadian for each alleged violation.


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