Five years after disbanding its United States sales force, Biovail Corp. is about to start hiring again, setting up a new sales group to market its growing range of drugs that treat nervous system disorders.
Canada's biggest public pharmaceutical company said yesterday that it will hire as many as 100 sales people starting this year, and may add as many as 150 further down the road, to sell its drugs to U.S. hospitals and doctors.
Currently Biovail sells its products in the United States through partners or contract sales organizations.
"This is the next big strategic step for the company," said chief executive officer Bill Wells, who has spearheaded Biovail's shift into the specialty market of drugs that deal with disorders of the central nervous system.
The catalyst that prompted the creation of a U.S. sales force was a deal Biovail signed earlier this month to acquire the U.S. and Canadian commercialization rights of a drug that treats agitation in patients with schizophrenia or bipolar disorder.
Under the deal, Biovail will sell Alexza Pharmaceuticals' formulation of the drug loxapine, which is given to patients through a special inhaler.
Because it is easier to administer than a shot, and takes effect faster than a pill, the inhaler is expected to carve out a significant niche in the treatment of millions of patients whose agitation may become violent and hard to handle, Mr. Wells said.
The best way to get this drug into the U.S. market - after regulators approve it, likely later this year - is through a direct sales force, he said.
Even before the drug gets approved Biovail will begin hiring between 60 and 100 people to market the drug in hospitals. If approval is also given to sell outside of an institutional setting, another 125 to 150 people will be added to market the product to psychiatrists who prescribe anti-psychotic drugs.
Eventually the group will also handle other Biovail drugs in its expanding portfolio of products that deal with central nervous system disorders.
"We're very aware of the fact that we need a second and a third [product] in the bag of the sales person ... and we plan to build that over time," Mr. Wells said.
Biovail eliminated its large U.S. sales force - about 600 people who sold a broad range of drugs - in 2005 during a sweeping restructuring.
The company still has a management infrastructure that can run a sales force, Mr. Wells said, "so all we have to do is add a few regional managers and hire some sales people." With many drug companies in the United States cutting back because of the recession, there are plenty of top sales people available, he said.
Biovail already has a sales force in Canada, and it will add the loxapine product to its portfolio when Canadian regulatory approval is received.
Creating the U.S. sales group will cost up to $20-million this year, and as much as $70-million in 2011.
That, and other costs associated with buying or licensing new products will likely cut per-share profits in 2010 below 2009 levels, Biovail executives said after releasing year-end results.
However, it is possible the company might make an acquisition this year that would boosts its income enough to offset that drop, they said.
Biovail has about 10 to 20 potential acquisition or licensing deals in various stages of negotiation.
Biovail Corp. (BVF)
Close: $15.34, up 5 cents
Biovail
Q4 / 2009 / 2008
Profit / $73 million / $120.4 million
EPS / 46¢ / 76 ¢
Revenue / $241.1 million / $181.5 million
All figures in U.S. dollars
Source : Company reports
