TORONTO – A lawyer for Biovail Corp said Wednesday that company shareholders have rejected a dissident slate of directors proposed by Biovail founder Eugene Melnyk, opting instead to stay the course with the current board.

David Jackson made the statement at Biovail's annual meeting. Results of a shareholder vote had not yet been announced formally.

There was debate at the meetiing over whether it was official or not after Melnyk revoked his personal holdings – the amount of which was not immediately clear. The move was a form of protest as Melnyk lost his bid to install his own slate of directors at the ailing drugmaker.

Melnyk, who founded the company almost 20 years ago and held numerous posts before stepping down last year, has said he decided to oppose the board after losing confidence in Biovail's corporate strategy and the board's abilities earlier this year.

Biovail, Canada's biggest publicly traded drug firm, has seen its stock price plunge 45 percent in the past four years.

Under Melnyk's plan, a development committee headed by Bruce Brydon – who was chief executive from 1995 to 2001 – would have emphasized the company's drug pipeline, including a return to so-called “difficult to manufacture” generic pharmaceuticals as welll as acquiring more products and technologies.

Meanwhile, the current board and newly appointed chief executive Bill Wells, stand behind strategic changes unveiled last month, including shutting down operations in Puerto Rico and shifting to new treatments for disorders of the central nervous system.

Biovail's shares rose 5 Canadian cents to C$10.85 on the Toronto Stock Exchange Wednesday morning.

($1-$1.01 Canadian)

(Writing by Wojtek Dabrowski, reporting by Scott Anderson; Editing by Peter Galloway)