By Scott Anderson
TORONTO (Reuters) - Biovail Corp
Mulligan, who has extensive experience with several big
Canadian companies and financial institutions, including Bank
of Nova Scotia
Mulligan replaces Adrian De Saldanha, who held the position on an interim basis.
De Saldanha, who was Biovail's vice-president of finance, took over the CFO job in late March following a U.S. Securities and Exchange Commission investigation that resulted in charges against four current and former officers of the company, including then-CFO Kenneth Howling and founder Eugene Melnyk.
"Everything they have done up until now has been an effort to clear the issues of the past," said Scotia Capital analyst John Maletic. "You could say (Mulligan's appointment is) another step in that direction."
Biovail shares, which have dropped more than 60 percent in the past year, were down 1.4 percent at C$10.55 on the Toronto Stock Exchange. They were flat at $10.10 in New York.
The stock has plunged on concerns over competition from generic versions of key Biovail products and a string of disappointing regulatory and legal rulings.
The SEC investigated a Biovail warning of a revenue shortfall in the third quarter of 2003, an October 2003 truck accident involving a shipment of Wellbutrin antidepressant, and the company's disclosure of the impact of that accident on its 2003 results.
The SEC said the executives had been obsessed with meeting quarterly and annual targets, and that they had overstated earnings and hid losses to deceive investors.
Howling was reassigned to a nonofficer position following the charges.
"We are putting a team together that we expect will take the company forward with the implementation of a new strategic focus. Peggy is an important part of that team," said company spokesman Nelson Isabel.
Less than two weeks ago, company shareholders elected its incumbent slate of directors, fending off a boardroom challenge from Melnyk.
Melnyk, who is Biovail's biggest shareholder, had proposed a new emphasis on the company's product pipeline, including a return to generic drugs, as well as acquiring more products and technologies.
($1=$1.05 Canadian)
(Reporting by Scott Anderson; Editing by Peter Galloway)
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