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It has faded from the headlines, but controversy still dogs the Oct. 1 traffic accident involving a
delivery truck and its shipment of antidepressants. New information obtained by
suggests the Canadian drugmaker overestimated the value of that cargo.
These are not the first questions raised about Biovail's truck accident and probably not the last: The company is scheduled to present at the JP Morgan Healthcare conference at 4:30 p.m. PST Wednesday, and attendees are likely to press for more information about the incident.
To recall, Biovail claims that lost revenue from the accident was in the range of $10 million to $20 million, forcing the company to issue a profit warning for the third quarter. But a
investigation suggests the value of the cargo to Biovail was in the range of only $2 million to $4 million.
To this day, Biovail has not made public any documentation related to the truck, its cargo of Wellbutrin XL pills, or the accident that would substantiate its claim of a $10 million to $20 million revenue loss. (The
Securities and Exchange Commission
is investigating Biovail's accounting and financial reporting practices, covering the fiscal year 2002 and quarterly periods through the third quarter of 2003. Among the documents requested by the SEC are "all invoices, all bills of lading and packing slips [and] all documents related to shipments of goods," according to the SEC letter sent to Biovail, made available by the company on its Web site.)
$2 million to $4 million revenue estimate was based on information included in the investigative report of the accident, conducted by the Illinois State Police (the accident happened outside Chicago). The police report provides the weight of the Wellbutrin XL shipment. Using this shipment weight, combined with other publicly known information, it's possible to calculate a rough value of the Wellbutrin XL pills on the truck at the time of the accident. It should be noted that some assumptions had to be made in these calculations, but in all instances, efforts were made to favor Biovail.
Asked to comment on
calculations, detailed on the next page, Biovail issued a statement: "Your information and calculations are wrong. We have no further comment."