May 6 (Bloomberg) -- GlaxoSmithKline Plc agreed to sell U.S. commercial rights for the Wellbutrin XL antidepressant to Biovail Corp. for $510 million, giving up a medicine that lost patent protection more than two years ago.

Earnings from the disposal of associated assets and other income will come to about 700 million pounds ($1.05 billion) this year, London-based Glaxo said today in a statement. Mississauga, Ontario-based Biovail said the transaction will add as much as 40 cents a share to profit this year.

Biovail, Canada’s largest publicly traded drugmaker, developed the once-a-day version of Wellbutrin XL and has split U.S. sales with Glaxo since 2003. Glaxo will retain rights to Wellbutrin XL outside the U.S., where the company is overhauling operations to help counter lost sales as generic competition threatens top sellers. Chief Executive Officer Andrew Witty is using acquisitions to expand in emerging markets and add more consumer products to fight the decline.

“It’s a good deal for GSK,” Jeremy Batstone-Carr, an analyst at Charles Stanley & Co. in London, wrote in an e-mail. “Get some cash in for an off-patent product and reduce exposure to North America,” where growth is slowing, he said.

Generic versions of the strongest, 300-milligram dose of went on sale in December 2006, while the 150-milligram tablet faced cheaper rivals last year. Wellbutrin is also approved to treat seasonal affective disorder.

‘Good Track Record’

“We have a good track record of managing off-patent branded pharmaceuticals to maximize value, which bodes well for the product’s long-term commercial prospects,” Bill Wells, Biovail’s CEO, said in a separate statement. The purchase will generate cash flow that can be used to expand Biovail’s pipeline of central nervous system products, he said.

The deal will add $80 million to $90 million in cash flow this year and $120 million to $130 million in 2010, Biovail said. It will add 35 cents to 40 cents to earnings per share this year and 46 cents to 51 cents next year.

Biovail reports first-quarter earnings today.

To contact the reporter on this story: Angela Cullen in Frankfurt at acullen8@bloomberg.net; Trista Kelley in London at tkelley2@bloomberg.net

Last Updated: May 6, 2009 05:43 EDT