The Securities and Exchange Commission announced the settlement with Biovail, which neither admitted nor denied the allegations in a civil lawsuit filed in federal court in Manhattan, but did agree to refrain from future violations of federal securities laws. Toronto-based Biovail also agreed to hire an independent consultant to oversee its accounting.

The SEC's charges remain pending against Biovail's founder and former chairman and CEO, Eugene Melnyk; former chief financial officer Brian Crombie; and two current executives: Chief Financial Officer Kenneth Howling and Controller John Miszuk.

In Canada, meanwhile, the Ontario Securities Commission filed related allegations against the four executives and scheduled a public hearing for April 22.

Melnyk and Crombie disputed the allegations and said they will contest them in court.

Biovail and senior executives "engaged in a pattern of systemic, chronic fraud" that distorted its quarterly and annual reports filed over four years, Mark Schonfeld, director of the SEC's New York regional office, said in a statement. To conceal the fraud, the executives "intentionally misled the company's auditors and the investing public, showing their complete disregard for their responsibilities to shareholders," Schonfeld said.

In October 2003, the SEC alleged, Biovail and several executives deceived investors and analysts by falsely attributing nearly half of the company's failure to meet its third-quarter earnings target to a truck accident involving a shipment of Biovail's antidepressant Wellbutrin XL. The accident in fact had no effect on earnings for the quarter, the SEC said.

The agency also accused the company of three fraudulent accounting schemes between 2001 and 2003: Shifting around $47 million in expenses for drug research and development onto the books of a "special purpose entity," concocting a phony transaction to record $8 million in revenue, and intentionally misstating losses from foreign currency transactions to understate a quarterly loss by some $3.9 million.

In a statement, Melnyk said: "The vast majority of the allegations made by the SEC and the (Ontario Securities Commission) do not pertain to me. ... I intend to vigorously contest the absolutely false allegations of the SEC and OSC, and am confident that I will prevail once all the facts are heard."

Melnyk, 48, who is a Canadian citizen and resident of Barbados, agreed to resign as Biovail chairman and CEO under a May 2007 settlement with the Canadian agency, which had accused him of violating Ontario securities law by failing to file insider-trading reports on his trades in Biovail shares from 2002 to 2004.

Crombie, through his attorney David Becker, also said he will contest the allegations in court.

Biovail said Monday that Howling and Miszuk are being reassigned to non-executive positions in the company and that Adrian de Saldanha, currently vice president for finance and treasurer, has been named interim chief financial officer.

Attorneys representing Howling and Miszuk didn't immediately return telephone calls.

Crombie, 47, and Miszuk, 54, are both Canadian citizens and residents of Mississauga, Ontario. Howling, 49, is a U.S. citizen who lives in Toronto.

Biovail shares rose 53 cents, or 4.6 percent, to close at $12.01 Monday.