Photograph by Francis Vachon

In early February 2009, the U.S. Securities and Exchange Commission levied a $1-million civil penalty against Eugene Melnyk, the Ontario-born, Barbados-residing owner of the Ottawa Senators hockey team. Melnyk, the SEC said, had violated various stock-disclosure and antifraud provisions during his tenure as president of Biovail Corporation, the one-time Canadian pharmaceutical wunderkind. It was the second time in less than a year that the SEC rapped the collective knuckles of Biovail executives. In March 2008, Biovail was made to pay a $10-million civil penalty for having “actively misled investors and analysts about the reasons for the company’s poor performance,” according to an SEC complaint. The SEC wanted to bar Melnyk from serving on the board of any publicly traded company in the U.S., which it ultimately did in 2011. (Melnyk settled with the SEC without admitting any wrongdoing.)

Despite the fines and resulting headlines, Melnyk’s reputation hardly suffered in the eyes of the Canadian government. Not five months after the second SEC judgment, Melnyk was at a sod-turning announcement for PurGenesis, a Quebec biotech company specializing in the production of spinach-based antioxidant medications and cosmetics.

“The government of Canada is proud to lend its support to this firm, the country’s first to manufacture plant-based medication,” said Quebec MP Steven Blaney, announcing $282,000 in new funding to PurGenesis in June 2009. All told, the federal government has invested $3.2 million in the company. Melnyk, PurGenesis’s president, chairman and largest investor, hinted at the many well-paying jobs that would result from the investment. Continue…