J.P. Morgan analyst Chris Schott said he is encouraged by new management's restructuring and shifting of the company's focus to treatments for disorders of the central nervous system.

In August, the company bought a drug intended to treat muscle movements caused by Parkinson's disease drugs, for example.

Schott said the developing Huntington's disease drug Xenazine is a "solid start" to the company's strategy, giving Biovail a niche opportunity. The drug candidate has Orphan Drug exclusivity through August of 2015.

Meanwhile, the antidepressant Wellbutrin XL has more upside potential, he added. During the second quarter, sales of Wellbutrin XL rose 2 percent to $37.1 million.

"We are encouraged by both the business development steps management has taken thus far to reposition Biovail as a specialty central nervous system disorder company and by the company's overall approach to business development," Schott said. "Since the initial implementation of the company's New Strategic Focus in May 2008, Biovail has engaged in five key business development transactions, the most notable of which are the Xenazine and Wellbutrin XL deals."

The stock rose 90 cents, or 6.5 percent, to $14.78 in afternoon trading. Shares reached a 52-week high of $14.88 earlier in the trading session.

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