TORONTO, May 16 /CNW/ - Eugene Melnyk today announced his retirement from
Biovail Corporation effective June 30, 2007 - the 20th anniversary of listing
the company on the Toronto Stock Exchange and becoming the company's Chairman
and CEO.
Melnyk made the announcement during his keynote speech to the company's
annual general meeting. Excerpts from the speech include:
Biovail Successes
"By 1999 - our company saw TIAZAC sales surpass $100 million - and our
market cap had grown to over $3 billion."
"Over the last 8 years, Biovail lived through its adolescence, with new
facilities added in the US, Ireland, Barbados and Puerto Rico. We developed
new, innovative drugs like Cardizem LA, Wellbutrin and Ultram ER. We now
employ more than 1,500 people and our market cap is approaching $4 Billion. In
2006 - for the first time in our history - our annual revenues exceeded $1
billion."
Family
"I'm 47 years old with a proud and successful career already behind me. I
can point to a dozen successful business deals in the last dozen years, but I
have a hard time remembering a dozen quality days at home in the last six
months."
"My wife, Laura, has to be one of the most understanding women - and
mothers - that I could hope to be with. My daughters - Anna and Olivia were
babies just yesterday - and before I knew it they were learning lessons from
the Internet that I should have been teaching them myself."
"It's an interesting personal reflection when you realize it is more
difficult to attend a single parent-teacher interview than it is to build a
new school for your children.
Philanthropy
"I'm going to spend time with my family. We're going to travel and I'm
going to expose my children to great learning opportunities around the world.
We're going to visit the orphanage camp which I fund every year in Ukraine,
because I think it's important for my girls to understand the world around
us."
Timing of Decision
"I obviously wish that I had settled my file with the OSC - and the SEC -
before making this announcement, but I refused advice to postpone this speech
for a "better time". This is the right decision - at the right time - for the
right reasons."
"I have 20 more years before a traditional "retirement" - but I came to
the realization last December and over the last few months that it's time I
take my retirement from my current day job."
Biovail's Future
"The focus should - and must be on the sound business fundamentals and
strong future of Biovail. And the future has never been brighter."
"We have the finest senior executive team in the industry - led by Doug
Squires. Doug and I have different backgrounds, but when I met him as part of
our CEO search two years ago, I immediately knew that he was the leader to
carry this company forward."
"Our board of directors is committed to this company's success - and
offers sound corporate governance oversight and procedures."Eugene Melnyk's Address to Biovail AGM - May 16, 2007
(*) CHECK AGAINST DELIVERY (*)
-------------------------------------------------------------------------Good morning.
Last night I met with Doug Squires and the Board of Directors to tell
them of my decision to retire from Biovail on June 30 - the 20th anniversary
of listing this company on the Toronto Stock Exchange and becoming its
Chairman and CEO. My retirement will include both my roles as Chairman and a
director of the company.
This is a decision I have given considerable thought to - and have been
seriously considering since Christmas.
I'd like to take a few minutes to talk about how we got here - how we
(gesture to crowd) ended up being part of a multi-billion pharmaceutical
leader in its sector. A company that has seen tremendous success and growth
and a company that is incredibly well-positioned for the coming years.
I'll start by looking to my mother - an incredibly strong, Ukrainian
woman who met my father in the early 1950s. Proud people of modest means who
worked hard to give their four children every opportunity in life.
My father was a doctor here in Toronto and a very large influence on the
direction of my life.
At 15, he got me a job working in a convalescence home - caring for the
elderly and learning first-hand the power of life-saving, life-extending and
life-improving drugs.
I tried my hand at business school - and it was a valuable 24 hour lesson
for me. We were presented with a case study. We were told that we were all
CEOs of a company with unmotivated employees - and asked what our strategy
would be to motivate them.
My classmates responded with a variety of solutions - team retreats,
picnics, bonuses, a lighter work load.
The professor looked at me and asked for my solution. My answer? Get new
employees - who are motivated to work. Give them all the tools they need and
set them up for success - but demand uncompromising quality and execution. The
professor told me I was wrong. I told him he was wrong and never went back to
school again. I always wondered what happened to that professor.
I was serious about what I said. I remember at the time having so many
ideas and dreams to chase - I just didn't get the idea of someone who was NOT
motivated every day. I woke up every morning motivated - and I still do.
As a youth, I saw a great opportunity in my own father's office. He
received dozens of mailings from pharmaceutical companies every month with
details on their new products. But it was too much to keep track of - and a
constant headache for doctors to read a new mailing every night.
So I started a company - Trimel - where we produced a bi-monthly series
of mini-magazines - similar to a reader's digest of medicine - and sold
advertising space to the pharmaceutical companies. At no point growing up did
I ever envision myself to be an editor and publisher of a magazine - but I
loved it. And I learned. I was passionate about the business and motivated by
the opportunity.
We turned a $20,000 loan from the bank into a $7 million company over a
few years.
We were on to something big - and on June 30, 1987 we listed the company
on the Toronto Stock Exchange with a market capitalization of $12 million
Canadian.
And the first morning I woke up without that feeling of motivation - of
passion - I knew the company had to be something more.
We recognized an opportunity - a risky one at the time - that added value
to existing formulations of pharmaceutical products. Trimel started to invest
in laboratories that were developing new drug-delivery technologies that
offered longer release, greater patient compliance and superior efficacy.
I brought on the world's smartest scientists and quickly realized the
future of this company was in developing controlled-release drug delivery
products, not just writing about them. I sold the publication division - with
an aggressive and single-minded focus to seek out the best partners and most
attractive acquisitions for growth and market dominance.
And over the next 5 years - between 1987 and 1992 - we began to grow one
of the world's first specialty pharmaceutical companies in our sector.
In the early 90s, we realized the significant business advantage of being
able to manufacture our own products - in our own facility. We broke ground on
our flagship manufacturing facility in Steinbach, Manitoba - now a quarter
million square feet - and rolled out our first product in 1994. It was around
this time that Biovail - as we know it today - was born.
Through the remainder of the 90s, we launched our first blockbuster drug
- TIAZAC, through a partnership with Forest Laboratories, signed a marketing
agreement with Teva Pharmaceuticals and acquired Fuisz Technologies -
including their important FlashDose delivery platform.
By 1999 - our "little" company saw TIAZAC sales surpass $100 million -
and our market cap had grown to over $3 billion.
Over the last 8 years, Biovail lived through its adolescence, with new
facilities added in the US, Ireland, Barbados and Puerto Rico. We developed
new, innovative drugs like Cardizem LA, Wellbutrin and Ultram ER. We now
employ more than 1,500 people and our market cap is approaching $4 Billion. In
2006 - for the first time in our history - our annual revenues exceeded $1
billion.
And with this growth - and success - came scrutiny. And scrutiny was
welcome. Investors who wanted to better understand the tremendous success
story of this little company that became a market leader in just a few short
years.
But not all scrutiny was fair - or even honest. Like the kind we saw
employed by a group of individuals who deliberately generated false and
misleading information about this company - to chip away at our success and
line their own pockets through illegal means.
Against the advice of many - including CEOs of small companies who folded
under the pressure of short-selling - I was determined to stand up and fight
for this company. It wasn't blind loyalty. It wasn't a "strategic tactic". It
was - and remains - a profound and deeply held belief - supported by evidence
- that there are those who would spend their days tearing apart what others
have spent their lives to build.
We will prevail in the actions we have taken in the US to hold these
people accountable. And it wasn't something that happened just to us. On the
heels of our actions, the United States Senate Judiciary Committee held
hearings into increasing and prevalent illegal short selling. The Canadian
Senate held hearings and called for tighter regulation of the hedge fund
industry.
A very large - and very revealing spotlight was switched on and caught a
lot of people by surprise. A lot of people doing things they weren't supposed
to. So I will say to those that have come - and will come - to illegally
attack the company - there is a line that has been drawn and that line you
shall not cross - not ever again.
I am personally driven - and sometimes burdened - by my overwhelming
passion and dedication to Biovail.
I have always employed the highest personal integrity and most rigorous
standards to everything I do. Every job I've had. Every business deal I've
done. I insist on the highest standards for myself - and demand it from those
who work with me. I play it straight - and have always talked straight about
the issues and opportunities facing us.
This includes the administrative and accounting issues that have been
raised by regulatory authorities.
I'm watching my counsel squirm as I venture anywhere close to this topic,
but I feel it important to say these things directly. I respect deeply the
role of market overseers and regulatory authorities. I value the integrity of
capital markets which depends on transparency for shareholders. I do not take
lightly the issues being reviewed, but I do believe we have reasonable answers
to the questions have been raised.
I'm going to personally deal with - and resolve - my outstanding items
with the OSC and SEC as soon as reasonably possible. Many of you would be
surprised how pleasant my legal counsel is, but I'd rather spend my time at a
hockey rink than meeting with them.
I obviously wish that I had settled my file with the OSC - and the SEC -
before making this announcement, but I refused advice to postpone this speech
for a "better time". This is the right decision - at the right time - for the
right reasons.
The focus should - and must be on the sound business fundamentals and
strong future of Biovail. And the future has never been brighter.
We have the finest senior executive team in the industry - led by Doug
Squires. Doug and I have different backgrounds, but when I met him as part of
our CEO search two years ago, I immediately knew that he was the leader to
carry this company forward.
Our board of directors is committed to this company's success - and
offers sound corporate governance oversight and procedures.
This is a personal accomplishment that I am very proud of. As many of you
will know, I announced a major corporate governance undertaking in mid 2004.
We redefined the responsibilities of the Board and management; enhanced the
board's effectiveness and significantly increased transparency to - and with -
shareholders.
We brought on new independent board members who I have to say have
provided excellent counsel for the company.
With the assistance of one of the most respected corporate governance
experts in the world - Carol Hansell - we made significant strides so that by
the end of 2005, the Globe and Mail's annual "Board Games" review ranked
Biovail as 64th out of 210 surveyed companies. We moved up 79 places in the
rankings in just one year. It was a major undertaking - the right undertaking.
The issues being examined by regulatory authorities today came before
this undertaking and I'm very confident in the company's future in their
hands.
Over the last number of years, my own personal passions and motivations
have expanded and grown. Biovail was always my first priority, but I found new
outlets for my life-long passion in sports.
In my youth, my uncle would take me to Woodbine Racetrack. I would play
pick-up hockey with my brothers on the street and idolized NHL heroes like
Davey Keon and Paul Henderson.
I was fortunate - am fortunate - to have the means to pursue my love for
sports.
I am proud to own the St. Mike's Majors and enjoy watching an
unparalleled quality of junior hockey. I am the proudest owner in the NHL of
the Ottawa Senators and have never seen the team play better than this year. I
am passionate about my horses and my farm in Florida.
And through my love for sports, I have found great opportunities to give
back to the communities that have given me so much.
There is one example in particular - one that moved me very personally -
that I want to share.
Several years ago I went to the stables at Belmont Park in New York to
see one of my horses after a race. As I talked to my jockey, I saw from the
corner of my eye one of the park's horse grooms - a young lady of Mexican
origin - who was quietly crying while brushing down my horse.
I went over and asked her what was wrong - but she didn't want to engage
me. I sat her down and asked her to tell me why she was upset. And she told me
that her young daughter - of 3 - was at home that morning sick after being up
all night with a fever.
As a parent of young daughters - I understood her concern. But then she
told me that her husband also worked at the stables and together they had no
access to child care as most centers open at 6am and their day starts at
4:30am. I honestly felt sick listening to her. I asked her where her husband
was. She pointed to the next stable over. I asked her where her daughter was -
and she broke down crying again as she told me, "In the car. Alone."
That same week I made the founding contribution to a child-care centre at
Gate 7 of Belmont Park - a centre dedicated to looking after the children of
all the horse workers - many of them immigrants - who work at the track and in
the stables. We named the centre after my oldest daughter Anna, and Anna House
today provides care and education for over 50 children while their parents
earn a living.
Since that day seven years ago, it's been a haunting encounter for me. I
realized that I had the means to help this young woman's family. And I did.
But every time my mind wanders to that day - which is quite often - I take
note that I'm not usually at home with my own family.
I'm 47 years old with a proud and successful career already behind me. I
can point to a dozen successful business deals in the last dozen years, but I
have a hard time remembering a dozen quality days at home in the last six
months.
My wife, Laura, has to be one of the most understanding women - and
mothers - that I could hope to be with. My daughters - Anna and Olivia were
babies just yesterday - and before I knew it they were learning lessons from
the Internet that I should have been teaching them myself.
As I reflected on these - and other - events, I took time to examine my
life. My successes. My regrets. My family - and what's really important in
life.
I'm not motivated by money. I was once - but I have what I need. What I
don't have - and what I want - is the flexibility to focus on new priorities.
It's an interesting personal reflection when you realize it is more
difficult to attend a single parent-teacher interview than it is to build a
new school for your children. I have 20 more years before a traditional
"retirement" - but I came to the realization last December and over the last
few months that it's time I take my retirement from my current day job.
I've been asked by close friends what I intend to do next. My PR advisors
implored me to give you a grander reason than I actually have, but I'm not
going to embellish something that is so personal to me in making this
decision. It's this simple:
I'm going to spend time with my family. We're going to travel and I'm
going to expose my children to great learning opportunities around the world.
We're going to visit the orphanage camp which I fund every year in Ukraine,
because I think it's important for my girls to understand the world around us.
I'm going to volunteer at my daughters' school. Watch a lot of hockey.
I'm going to race my horses - and breed new winners. I'm going to keep
investing in youth and look for new amateur and professional sporting
opportunities to further my passion - and I'm going to give back to
communities where I can.
And as the largest investor in Biovail, I'll be enjoying every one of the
company's successes from the sidelines.
As I think back to my only day in business school - to that poor
professor who didn't understand what motivates people - I can honestly tell
you that I have never been more motivated as an individual. I see nothing but
opportunity and success in Biovail's future and I am completely at ease and
passionate about my own immediate future.
I want to thank the employees of Biovail for their years of commitment
and dedication to the company - and to me. I want to extend my sincere thanks
to all of Biovail's valued shareholders for your continued investment and
strong support for this company.
Thank you.
For further information: Lisa Merrithew (Canadian media),
lisa.merrithew@fleishman.ca or (613) 302-4634; Mike Sitrick (US media),
mike_sitrick@sitrick.com or (310) 788-2850
