AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 19, 2001JUNE 6, 2002
REGISTRATION STATEMENT NO. 333-___________
================================================================================333-87110
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------------
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
------------------------------------
LIGAND PHARMACEUTICALS INCORPORATED
(Exact Name of Registrant as Specified in its Charter)
DELAWARE
77-0160744
(State or Other Jurisdiction of Incorporation or
Organization)
77-0160744
(I.R.S. Employer Identification Number)
of Incorporation or Organization)
------------------------------------
10275 Science Center Drive, San Diego, California 92121-1117
(858) 550-7500
(Address, Including Zip Code, and Telephone Number, Including Area Code,
of Registrant's Principal Executive Offices)
------------------------------------
David E. Robinson
President and Chief Executive Officer
LIGAND PHARMACEUTICALS INCORPORATED
10275 Science Center Drive, San Diego, California 92121-1117 (858) 550-7500
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code,
of Agent for Service)
------------------------------------
Copies to:
Faye H. Russell, Esq.
Carey J. Fox, Esq.
BROBECK, PHLEGER & HARRISON LLP
12390 El Camino Real
San Diego, California 92130
(858) 720-2500
------------------------------------
Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this registration statement.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box: [ ]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box: [x]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering: [ ]
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering:[ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box: [ ]
CALCULATION OF REGISTRATION FEE
==========================================================================================================
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF SHARES AMOUNT TO BE AGGREGATE OFFERING AGGREGATE OFFERING AMOUNT OF
TO BE REGISTERED REGISTERED (1) PRICE PER SHARE (2) PRICE(2) REGISTRATION FEE
- -------------------------- --------------- ---------------------- --------------------- -----------------
Common Stock, par value 2,000,000 $12.16405 $24,328,100.00 $6,082.03
$.001 per share
========================== =============== ====================== ===================== =================
(1) This registration statement shall also cover any additional shares of
common stock which become issuable in connection with the shares registered
for sale hereby as a result of any stock dividend, stock split,
recapitalization or other similar transaction effected without the receipt
of consideration which results in an increase in the number of the
Registrant's outstanding shares of common stock.
(2) Estimated solely for the purpose of determining the registration fee and
computed pursuant to Rule 457(c) based on the average of the high and low
sales prices per share of the common stock on January 12, 2001 as reported
on The Nasdaq Stock Market.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE SEC, ACTING PURSUANT TO SAID SECTION
8(A), MAY DETERMINE.
===============================================================================================================================================================
SUBJECT TO COMPLETION, DATED JANUARY 19, 2001
PRELIMINARY PROSPECTUS
The information in this preliminary prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. ThisThe preliminary prospectus is
not an offer to sell our common stockthese securities and it is not soliciting an offer to buy
our common stockthese securities in any state where the offer or sale is not permitted.
SUBJECT TO COMPLETION, DATED JUNE 6, 2002
PRELIMINARY PROSPECTUS
LIGAND PHARMACEUTICALS INCORPORATED
2,000,0004,252,500 SHARES OF COMMON STOCK
This prospectus relates to the public offering, which is not being underwritten,
of 2,000,0004,252,500 shares of our common stock, which is held by some of our current
stockholders. These stockholders acquired the shares directly from us in a
private placement completed on January 10, 2001.April 19, 2002.
Our common stock is traded on The Nasdaq Stock Market under the symbol "LGND."
On January 18, 2001,June 3, 2002, the average of the high and low sales prices for our common
stock was $13.0625.$17.18
----------------------------------
THE COMMON STOCK OFFERED INVOLVES A HIGH DEGREE OF RISK. SEE "RISK FACTORS"
COMMENCING ON PAGE [4]3 FOR A DISCUSSION OF SOME IMPORTANT RISKS YOU SHOULD
CONSIDER BEFORE BUYING ANY OF OUR COMMON STOCK.
----------------------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES, OR PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
----------------------------------
The date of this prospectus is January 19, 2001June 6, 2002
TABLE OF CONTENTS
PAGE
LIGAND PHARMACEUTICALS INCORPORATED....................................1INCORPORATED......................................1
RISK FACTORS...........................................................4FACTORS.............................................................3
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS............................................12STATEMENTS....................11
WHERE YOU CAN FIND MORE INFORMATION...................................12INFORMATION.....................................11
INFORMATION INCORPORATED BY REFERENCE.................................13REFERENCE...................................12
USE OF PROCEEDS.......................................................14PROCEEDS.........................................................13
PLAN OF DISTRIBUTION..................................................14DISTRIBUTION....................................................13
SELLING STOCKHOLDERS..................................................16STOCKHOLDERS....................................................16
LEGAL MATTERS.........................................................17
EXPERTS...............................................................17MATTERS...........................................................18
EXPERTS.................................................................18
i
LIGAND PHARMACEUTICALS INCORPORATED
Our goal is to build a profitable pharmaceutical company that discovers,
develops and markets new drugs that address critical unmet medical needs in the
areas of cancer, men's and women's health, or hormone-related health issues,
skin diseases, osteoporosis, and metabolic, cardiovascular and inflammatory
diseases. We strive to develop drugs that are more effective and/or safer than
existing therapies, that are more convenient (taken orally or topically
administered) and that are cost effective. We plan to build a profitable
pharmaceutical company by generating income from the specialty pharmaceutical
products we develop and market, and from research, milestone and royalty
revenues resulting from our collaborations with large pharmaceutical partners,
which develop and market products in large markets that are beyond our strategic
focus or resources. Our investments in both our specialty products business and
our collaborations, as well as other aspects of our business since our founding,
have been significant. These investments are reflected in the losses we have
recorded over the years and in our accumulated deficit of about $592 million as
of March 31, 2002.
We currently market four cancer products in the United States: Panretin(R)
gel, ONTAK(R) and Targretin(R) capsules, each of which were approved by the
United States Food and Drug Administration, or FDA, in 1999; and Targretin(R)
gel, which was approved by the FDA in 2000. In Europe, the European Commission
granted a Marketing Authorization, or MA, for Panretin gel in October 2000 and
an MA for Targretin capsules in March 2001. We submitted Marketing Authorization
Applications to the European Agency for the Evaluation of Medicinal Products for
Targretin gel in March 2001 and for ONZAR(TM) (the brand name of ONTAK in
Europe) in December 2001. We also market Avinza(TM), formerly Morphelan(TM), a
pRoduct for the once-daily treatment of moderate-to-severe pain that is expected
to last more than a few days, which we licensed from Elan Corporation plc and
which was approved by the FDA in March 2002. We also continue efforts to acquire
or in-license products, such as ONTAK (acquired in the 1998 acquisition of
Seragen), which have near-term prospects of FDA approval and which can be
marketed by our specialty sales forces. We are developing additional products
through our internal development programs and currently have various products in
clinical development, including marketed products that we are testing for larger
market health problems such as non-small cell lung cancer (NSCLC), B-cell
non-Hodgkin's Lymphoma (NHL), psoriasis and rheumatoid arthritis. The risks that
we face in this specialty products business include risks that our drugs may not
be approved or that marketed drugs may not be approved for larger markets by
regulatory agencies, that the market demand for the drugs could be low, or that
so far we have a relatively small number of products in niche markets.
We have research and development collaborations with numerous global
pharmaceutical companies, including Abbott Laboratories, Allergan, Bristol-Myers
Squibb, Eli Lilly & Co., GlaxoSmithKline, Organon (AKZO-Nobel), Pfizer,
Takeda-Abbott Pharmaceuticals (TAP) and Wyeth (formerly American Home Products).
At the end of 2001, our corporate partners had six Ligand products in human
development, six products moving toward regulatory filings for human clinical
trials, and numerous compounds in research and pre-clinical stages. These
corporate partner products are being studied for the treatment of health
problems with large markets such as osteoporosis, diabetes, contraception and
cardiovascular disease. Three of these partner products are being tested in
pivotal Phase III clinical trials: lasofoxifene, which is being developed by
Pfizer for osteoporosis; and bazedoxifene (formerly TSE-424), which is being
developed by Wyeth both as monotherapy for osteoporosis and in combination with
Wyeth's PREMARIN(R) as hormone replacement therapy (HRT). In March 2002 Royalty
Pharma AG purchased from us rights to a share of future payments from these
three partner products. The risks that we face in our collaborations include the
risks that the projects may not be successful in producing drugs, that
collaborators and others may bring competing drugs to market or divert resources
to other projects, or that the collaborations themselves may not be continued.
Internal and collaborative research and development programs are built
around our proprietary science technology, which is based on our leadership
position in gene transcription technology, a technology for regulating how genes
are used to make proteins inside cells. Our proprietary technologies involve two
natural mechanisms that regulate gene activity: hormone-activated intracellular
receptors, or IRs, a type of sensor or switch inside cells that turns genes on
and off and alters the production of proteins in response to hormones, and
Signal Transducers and Activators of Transcription, or STATs, another type of
protein production switch. Panretin gel, Targretin capsules, Targretin gel and
all but one of our corporate partner products currently on human development
track were discovered using our IR technology. A compound discovered using our
STAT technology is moving toward a regulatory filing for human clinical trials
at GlaxoSmithKline.
In late 1998, we assembled a specialty cancer and HIV-center sales and
marketing team for the U.S. market to sell products developed, acquired or
licensed by us. In late 1999, we expanded our U.S. sales force from
approximately 20 to approximately 40 sales representatives to support the launch
of Targretin capsules and Targretin gel and increase market penetration of ONTAK
and Panretin gel. In 2001, we further expanded our sales force to approximately
50 sales representatives, including approximately 20 full-time contract sales
representatives who focus on the dermatology market. In anticipation of the
launch of Avinza in 2002, we also announced in 2001 a strategic decision to form
another sales force of approximately 25 representatives to target general pain
centers not served by our existing representatives. Internationally, through
marketing and distribution agreements with some of our pharmaceutical
distribution partners including Elan, we have established marketing and
distribution capabilities in Europe, as well as Central and South America.
------------------------
Our trademarks, trade names and service marks referenced in this document
include Ligand(R), Avinza(TM), ONTAK(R), Panretin(R) and Targretin(R). Each
other trademark, trade name or service mark appearing in this document belongs
to itsiTs holder.
Reference to Ligand Pharmaceuticals Incorporated, "Ligand", the "Company", "we"
or "our" include Ligand's wholly owned subsidiaries, Glycomed Incorporated,
Ligand Pharmaceuticals (Canada) Incorporated, Ligand Pharmaceuticals
International, Inc., and Seragen, Inc.
i
LIGAND PHARMACEUTICALS INCORPORATED
We are a pharmaceutical company that discovers, develops and markets new
drugs that address critical unmet medical needs of patients. We have a diverse
product portfolio that includes four FDA approved drugs. Our pipeline includes
several product candidates in late stage development that address large market
indications, including non-small cell lung cancer, osteoporosis, cardiovascular
disease and diabetes. Our commercialization strategy includes developing
products internally, as well as establishing research and development
collaborations with global pharmaceutical companies using our proprietary
technology based on our leadership position in gene transcription technology.
We have initially focused our approved products on niche oncology
indications, which we believe has allowed us to bring these products to market
relatively quickly. Revenues for these products totaled $16.2 million for the
nine months ended September 30, 2000. We are seeking to expand the markets for
these products by seeking additional indication approvals, approvals in
international markets and marketing and distribution agreements in select
international markets. Through our collaborative research and development
business with major pharmaceutical companies, we plan to develop and market
products with large market potential.
OUR PRODUCTS
We currently market four oncology products in the United States. Panretin
gel, ONTAK and Targretin capsules were approved for marketing in 1999 and
Targretin gel was approved in 2000. In Europe, the European Commission granted
Marketing Authorization for Panretin gel in October 2000, and the Committee for
Proprietary Medicinal Products adopted a positive opinion recommending the grant
of Marketing Authorization for Targretin capsules in November 2000. Our current
marketed products, the diseases or conditions they address and additional
indications in development are shown below:
- ------------------------- ------------- --------------- -------------------------- ------------------------------------
MARKETED
PRODUCTS INDICATION U.S. STATUS EUROPEAN STATUS INDICATIONS IN DEVELOPMENT
- ------------------------- ------------- --------------- -------------------------- ------------------------------------
ONTAK Cutaneous Marketed Marketing Authorization Non-Hodgkin's lymphoma,
T-cell Application (Europe) to rheumatoid arthritis, and psoriasis
lymphoma be filed
Panretin gel Kaposi's Marketed Approved Other skin diseases
sarcoma
Targretin capsules Cutaneous Marketed Committee for Proprietary Non-small cell lung cancer,
T-cell Medicinal Products psoriasis, advanced breast
lymphoma recommendation received cancer, and other cancers
Targretin gel Cutaneous Marketed Marketing Authorization Atopic dermatitis and psoriasis
T-cell Application (Europe) to
lymphoma be filed
- ------------------------- ------------- --------------- -------------------------- ------------------------------------
In addition to our current products and collaborative product candidates, a new
application for market approval has been filed in the U.S. for Morphelan, a drug
for chronic pain that we license from Elan Corporation, plc.
OUR COLLABORATIVE PRODUCT CANDIDATES
We have established research and development collaborations with numerous
global pharmaceutical companies, including: Bristol-Myers Squibb Company,
Organon Company, Warner-Lambert Company, Eli Lilly and Company, SmithKline
Beecham Corporation, American Home Products, Abbott Laboratories, Sankyo Company
Ltd., Glaxo-Wellcome plc, Allergan, Inc., and Pfizer Inc. Our corporate partner
products are being studied for the treatment of large market indications such as
osteoporosis, breast cancer, diabetes, cardiovascular
disease, hormone replacement therapy and contraception. Selected product
candidates in our collaboration pipeline include the following:
- --------------------------- ---------------------- ------------------------------------- ------------------------
COLLABORATOR PRODUCT CANDIDATE INDICATION STAGE OF DEVELOPMENT
- --------------------------- ---------------------- ------------------------------------- ------------------------
Pfizer Lasofoxifene Osteoporosis Phase III
American Home Prod. TSE 424 Osteoporosis Phase II/III
ERA 923 Breast Cancer Phase II
WAY 910/BU Contraception IND Track
Glaxo GW 544 Diabetes / Cardiovascular Disease Phase I/II
GW 516 Cardiovascular Disease Phase I
Lilly LY 929 Diabetes IND Track
LY YYY Cardiovascular Disease Pre-clinical
Allergan AGN 4310 Psoriasis / Toxicity Modulator RA Phase II
- --------------------------- ---------------------- ------------------------------------- ------------------------
OUR STRATEGY
Our goal is to become a profitable pharmaceutical research, development and
marketing company. Building initially on our proprietary Intracellular Receptor
or IR, and Signal Transducer and Activator of Transcription or, STATs,
technologies, our strategy is to generate revenues primarily from:
o the sale in the U.S. and Europe of specialty oncology and dermatology
products developed, acquired or in-licensed by us; and
o research, milestone and royalty revenues from the development and sale of
products by our collaboration partners.
OUR ONCOLOGY FRANCHISE
Our oncology strategy is to develop specialty cancer products and to market
these products initially with a specialized sales force in the U.S. and directly
or through marketing partners in selected international markets. We believe
focusing initially on niche oncology drugs that have the possibility of
expedited regulatory approval has allowed us to bring products to market
quickly. This strategy also allows us to market these products with a targeted
specialty oncology sales force, spreading the cost of our sales and marketing
infrastructure among multiple products. Our goal is to expand the markets for
our products through additional indication approvals, approvals in international
markets and marketing and distribution agreements in select international
markets where we will not market directly. To further derive value from our
specialty sales force, we intend to selectively license-in or acquire additional
complementary technology and product candidates in advanced stages of
development.
OUR COLLABORATION STRATEGY
Our strategy in collaborative research and development is to share the
risks and benefits of discovering and developing drugs to treat diseases that
are beyond our strategic focus or resources. These diseases typically affect
large populations often treated by primary care physicians, and require
therapeutic treatments that may be costly to develop and/or to market
effectively. Despite these factors, drugs approved for these indications may
have large market potential.
Since our inception, we have entered into 12 significant collaborations
with major pharmaceutical companies focusing on a broad range of disease
targets. In 2000, our corporate partners advanced three compounds into human
development track and an additional compound entered Phase III trials.
2
OUR INTELLECTUAL PROPERTY PORTFOLIO
To date, we have filed or participated as a licensee in the filing of
approximately 108 currently pending patent applications in the United States
relating to our technology, as well as foreign counterparts of certain of these
applications in many countries. In addition, we own or are the exclusive
licensee to rights covered by approximately 190 patents issued, granted or
allowed worldwide. Subject to compliance with the terms of the respective
agreements, our rights under our licenses with our exclusive licensors extend
the life of the patents covering such developments.
HUMAN RESOURCES
As of December 31, 2000, we had 384 full-time employees, of whom 219 were
involved directly in scientific research and development activities. Of these,
approximately 64 hold Ph.D. or M.D. degrees.
Our executive offices are located at 10275 Science Center Drive, San Diego,
California 92121-1117, and our telephone number is (858) 550-7500.
3
RISK FACTORS
IN ADDITION TO THE OTHER INFORMATION IN THIS PROSPECTUS, YOU SHOULD
CAREFULLY CONSIDER THE FOLLOWING RISKS AND UNCERTAINTIES BEFORE PURCHASING
SHARES OF OUR COMMON STOCK. EACH OF THESE RISK AND UNCERTAINTIES COULD ADVERSELY
AFFECT OUR BUSINESS, OPERATING RESULTS AND FINANCIAL CONDITION, AS WELL AS
ADVERSELY AFFECTING THE VALUE OF AN INVESTMENT IN OUR COMMON STOCK
RISKS RELATED TO OUR BUSINESS
OUR PRODUCT DEVELOPMENT AND COMMERCIALIZATION INVOLVES A NUMBER OF UNCERTAINTIES
AND WE MAY NEVER GENERATE SUFFICIENT REVENUES FROM THE SALE OF PRODUCTS TO
BECOME PROFITABLE.
We were founded in 1987. We have incurred significant losses since our
inception. At September 30, 2000,March 31, 2002, our accumulated deficit was $516.7approximately $592
million. To date, we have received the majority of our revenues from our
collaborative arrangements and only began receiving revenues from the sale of
pharmaceutical products in 1999. To become profitable, we must successfully
develop, clinically test, market and sell our products. Even if we achieve
profitability, we cannot predict the level of that profitability or whether we
will be able to sustain profitability. We expect that our operating results will
fluctuate from period to period as a result of differences in when we incur
expenses and receive revenues from product sales, collaborative arrangements and
other sources. Some of these fluctuations may be significant.
Most of our products in development will require extensive additional
development, including preclinical testing and human studies, as well as
regulatory approvals, before we can market them. We do not expect thatcannot predict if or when
any of the products resulting fromwe are developing or those being co-developed with our
product development efforts or the efforts of our
collaborative partners other than those for which marketing approval has
already been received, will be availableapproved for sale until the second half of the
2001 calendar year at the earliest, if at all.marketing. There are many reasons that we or our
collaborative partners may fail in our efforts to develop our other potential
products, including the possibility that:
o preclinical testing or human studies may show that our potential products
are ineffective or cause harmful side effects,
o the products may fail to receive necessary regulatory approvals from the
FDA or foreign authorities in a timely manner or at all,
o the products, if approved, may not be produced in commercial quantities or
at reasonable costs,
o the products once approved, may not achieve commercial acceptance, or
o the proprietary rights of other parties may prevent us or our partners from
marketing the products.
WE ARE BUILDING MARKETING AND SALES FORCESCAPABILITIES IN THE UNITED STATES AND EUROPE
WHICH IS AN EXPENSIVE AND TIME-CONSUMING PROCESS.PROCESS AND MAY INCREASE OUR OPERATING
LOSSES.
Developing the sales force to market and sell products is a difficult,
expensive and time-consuming process. We have developed a 40 person U.S. sales force andof
about 80 people, some of whom are contracted from a third party. We also rely on
another companythird-party distributors to distribute our products. The distributor isdistributors are
responsible for providing many marketing support services, including customer
service, order entry, shipping and billing, and customer reimbursement
assistance. In Europe, we will rely initially on other companies to distribute
and market our products. In 1999, weWe have entered into agreements for the marketing and
distribution of our products in territories such as the United Kingdom, Germany,
France, Spain, Portugal, Greece, Italy, and Central and South America and wehave
established a subsidiary, Ligand Pharmaceuticals International, Inc., with a
branch in London, England, to prepare forcoordinate our European marketing and operations.
We may not be able to continue to establish
and maintain theexpand our sales and marketing capabilities
necessarysufficiently to successfully commercialize our products in the territories where
they receive
4
marketing approval. To the extent we enter into co-promotion or
other licensing arrangements, any revenues we receive will depend on the
marketing efforts of others, which may or may not be successful.
3
OUR SMALL NUMBER OF PRODUCTS MEANS OUR RESULTS ARE VULNERABLE TO SETBACKS WITH
RESPECT TO ANY ONE PRODUCT.
We currently have only 4 products approved for marketing, one additional
product, Avinza, for which the licensor, Elan, has received approval for
marketing, and a handful of other products/indications that have made
significant progress through development. Because these numbers are small,
especially the number of marketed products, any significant setback with respect
to any one of them could significantly impair our operating results and/or
reduce the market price for shares of our stock. Setbacks could include problems
with shipping, manufacturing, product safety, marketing, government licenses and
approvals, intellectual property rights and physician or patient acceptance of
the product.
SALES OF OUR SPECIALTY PHARMACEUTICAL PRODUCTS MAY SIGNIFICANTLY FLUCTUATE EACH
PERIOD BASED ON THE NATURE OF OUR PRODUCTS, OUR PROMOTIONAL ACTIVITIES AND
WHOLESALER PURCHASING AND STOCKING PATTERNS.
Our products include small-volume specialty pharmaceutical products that
address the needs of cancer patients in relatively small niche markets with
substantial geographical fluctuations in demand. To ensure patient access to our
drugs, we maintain broad distribution capabilities with inventories held at
approximately 100 locations throughout the United States. Furthermore, the
purchasing and stocking patterns of our wholesaler customers are influenced by a
number of factors that vary with each product including but not limited to
overall level of demand, periodic promotions and required minimum shipping
quantities. As a result, our distributors may carry from two to six months worth
of projected inventory usage. If our distributors were to decide to
substantially reduce the inventory they carry in a given period, our sales for
that period could be substantially lower than historical levels.
SOME OF OUR KEY TECHNOLOGIES HAVE NOT BEEN USED TO PRODUCE MARKETED PRODUCTS AND
MAY NOT BE CAPABLE OF PRODUCING SUCH PRODUCTS.
To date, we have dedicated most of our resources to the research and
development of potential drugs based upon our expertise in our IR and STATsSTAT
technologies. Even though there are marketed drugs that act through IRs, some
aspects of our IR technologies have not been used to produce marketed products.
In addition, we are not aware of any drugs that have been developed and
successfully commercialized that interact directly with STATs. Much remains to
be learned about the location and function of IRs and STATs. If we are unable to
apply our IR and STAT technologies to the development of our potential products,
we will not be successful in developing new products.
OUR DRUG DEVELOPMENT PROGRAMS WILL REQUIRE SUBSTANTIAL ADDITIONAL FUTURE CAPITAL.FUNDING
WHICH COULD HURT OUR OPERATIONAL AND FINANCIAL CONDITION.
Our drug development programs require substantial additional capital to
successfully complete them, arising from costs to:
o conduct research, preclinical testing and human studies,
o establish pilot scale and commercial scale manufacturing processes and
facilities, and
o establish and develop quality control, regulatory, marketing, sales and
administrative capabilities to support these programs.
Our future operating and capital needs will depend on many factors,
including:
o the pace of scientific progress in our research and development programs
and the magnitude of these programs,
o the scope and results of preclinical testing and human studies,
o the time and costs involved in obtaining regulatory approvals,
o the time and costs involved in preparing, filing, prosecuting, maintaining
and enforcing patent claims,
4
o competing technological and market developments,
o our ability to establish additional collaborations,
o changes in our existing collaborations,
o the cost of manufacturing scale-up, and
o the effectiveness of our commercialization activities.
We base our outlook regarding the need for additional funds on many
uncertain variables. Such uncertainties include regulatory approvals, the timing
of events outside our direct control such as product launches by partners, the
success of such product launches, negotiations with potential strategic
partners, and other factors. Any of these uncertain events can significantly
change our cash requirements as they determine such one-time events as the
receipt of major milestones and other payments.
For example, we are required under the terms of our agreement with Elan, to
spend not less than $7 million through May 2003 to undertake additional clinical
activities related to the commercialization of Morphelan.Avinza, formerly Morphelan(TM).
In the
5
event we do not spend this amount, any shortfall would have to be paid to
Elan. If additional funds are required to support our operations and we are
unable to obtain them on terms favorable to us, we may be required to cease or
reduce further commercialization of our products, to sell some or all of our
technology or assets or to merge with another entity.
WE MAY REQUIRE ADDITIONAL MONEY TO RUN OUR BUSINESS AND MAY BE REQUIRED TO RAISE
THIS MONEY ON TERMS WHICH ARE NOT FAVORABLE OR WHICH REDUCE OUR STOCK PRICE.
We have incurred losses since our inception and do not expect to generate
positive cash flow to fund our operations for one or more years. As a result, we
may need to complete additional equity or debt financings to fund our
operations. Our inability to obtain additional financing could adversely affect
our business. Financings may not be available at all or on favorable terms. In
addition, these financings, if completed, still may not meet our capital needs
and could result in substantial dilution to our stockholders. For instance, in
February and March 2002 we issued to Elan 6.3 million shares upon the conversion
of zero coupon convertible senior notes held by Elan, and in January 2001 and
April 2002 we issued 2 million shares and 4.3 million shares of our common
stock, respectively, in private placements. These transactions have resulted in
the issuance of significant numbers of new shares. If adequate funds are not
available, we may be required to delay, reduce the scope of or eliminate one or
more of our drug development programs. Alternatively, we may be forced to
attempt to continue development by entering into arrangements with collaborative
partners or others that require us to relinquish some or all of our rights to
technologies or drug candidates that we would not otherwise relinquish.
OUR PRODUCTS MUST CLEARFACE SIGNIFICANT REGULATORY HURDLES PRIOR TO MARKETING.MARKETING WHICH COULD
DELAY OR PREVENT SALES.
Before we obtain the approvals necessary to sell any of our potential
products, we must show through preclinical studies and human testing that each
product is safe and effective. We have a number of Ligand and partner products
moving toward or currently in clinical trials, the most significant of which are
our Phase III trials for Targretin capsules in non-small cell lung cancer and
three Phase III trials by our partners involving bazedoxifene and lasofoxifene.
Our failure to show any product's safety and effectiveness would delay or
prevent regulatory approval of the product and could adversely affect our
business. The clinical trials process is complex and uncertain. The results of
preclinical studies and initial clinical trials may not necessarily predict the
results from later large-scale clinical trials. In addition, clinical trials may
not demonstrate a product's safety and effectiveness to the satisfaction of the
regulatory authorities. A number of companies have suffered significant setbacks
in advanced clinical trials or in seeking regulatory approvals, despite
promising results in earlier trials. The FDA may also require additional
clinical trials after regulatory approvals are received, which could be
expensive and time-consuming, and failure to successfully conduct those trials
could jeopardize continued commercialization.
The rate at which we complete our clinical trials depends on many factors,
including our ability to obtain adequate supplies of the products to be tested
and patient enrollment. Patient enrollment is a function of many factors,
including the size of the patient population, the proximity of patients to
clinical sites and the eligibility
5
criteria for the trial. For example, each of our Phase III Targretin clinical
trials will involve approximately 600 patients and may require significant time
and investment to complete enrollments. Delays in patient enrollment may result
in increased costs and longer development times. In addition, our collaborative
partners have rights to control product development and clinical programs for
products developed under the collaborations. As a result, these collaborators
may conduct these programs more slowly or in a different manner than we had
expected. Even if clinical trials are completed, we or our collaborative
partners still may not apply for FDA approval in a timely manner or the FDA
still may not grant approval.
WE MAY NOT BE ABLE TO PAY AMOUNTS DUE ON OUR OUTSTANDING INDEBTEDNESS WHEN DUE
WHICH WOULD CAUSE DEFAULTS UNDER THESE ARRANGEMENTS.
We and our subsidiaries may not have sufficient funds to make required
payments due under existing debt. If we or our subsidiaries do not have adequate
funds, we will be forced to refinance the existing debt and may not be
successful in doing so. Our subsidiary, Glycomed, is obligated to make payments
under convertible subordinated debentures in the total principal amount of $50
million. The debentures incur interest semi-annually at a rate of 7 1/2% per
annum, are due in 2003 and convertible into our common stock at $26.52 per
share. On June 3, 2002, we completed the redemption of these debentures. In
addition, at September 30, 2000,April 1, 2002, we had outstanding a $2.5 million convertible note
to SmithKline Beecham CorporationGlaxoSmithKline due in 2002 with interest at prime and convertible into our
common stock at $13.56 per share.
At September
30, 2000, we also had outstanding $68.4 million in zero coupon convertible
senior notes to Elan, due 2008 with an 8% per annum yield to maturity and
convertible into our common stock at $14 per share. On December 29, 2000, we
issued $10 million of zero coupon convertible notes to Elan due 2008, accruing
interest at 8% per annum, compounding semi-annually, convertible at $14.16 per
share and callable at accreted value beginning in November 2001. Glycomed's
failure to make payments when due under its debentures would cause us to default
under the outstanding notes to Elan.
WE MAY REQUIRE ADDITIONAL MONEY TO RUN OUR BUSINESS AND MAY BE REQUIRED TO RAISE
THIS MONEY ON TERMS WHICH ARE NOT FAVORABLE TO OUR EXISTING STOCKHOLDERS.
We have incurred losses since our inception and do not expect to generate
positive cash flow to fund our operations for one or more years. As a result, we
may need to complete additional equity or debt financings to fund our
operations. Our inability to obtain additional financing could adversely affect
our business. Financings may not be available on acceptable terms. In addition,
these financings, if completed, still may not meet our capital needs and could
result in substantial dilution to our stockholders. For instance, the zero
coupon convertible senior notes
6
outstanding to Elan are convertible into common stock at the option of
Elan, subject to some limitations. If adequate funds are not available, we may
be required to delay, reduce the scope of or eliminate one or more of our drug
development programs. Alternatively, we may be forced to attempt to continue
development by entering into arrangements with collaborative partners or others
that require us to relinquish some or all of our rights to technologies or drug
candidates that we would not otherwise relinquish.
WE FACE SUBSTANTIAL COMPETITION.COMPETITION WHICH MAY LIMIT OUR REVENUES.
Some of the drugs that we are developing and marketing will compete with
existing treatments. In addition, several companies are developing new drugs
that target the same diseases that we are targeting and are taking IR-related
and STAT-related approaches to drug development. The principal products
competing with our products targeted at the cutaneous t-cell lymphoma market are
Supergen/Abbott's Nipent(R) and interferon, which is marketed by a number of
companies, including Schering-Plough's Intron(R) A. Products that will compete
with Avinza include Purdue Pharma L.P.'S OxyContin(R) and MS Contin(R), Janssen
Pharmaceutica Products, L.P.'s Duragesic(R), , Roxane Laboratories, Inc.'s
OramoRph(R) SR and Purepac Phamaceutical Co.'s Kadian(R), each of which is
currently marketed. Many of our existing or potential competitors, particularly
large drug companies, have greater financial, technical and human resources than
us and may be better equipped to develop, manufacture and market products. Many
of these companies also have extensive experience in preclinical testing and
human clinical trials, obtaining FDA and other regulatory approvals and
manufacturing and marketing pharmaceutical products. In addition, academic
institutions, governmental agencies and other public and private research
organizations are developing products that may compete with the products we are
developing. These institutions are becoming more aware of the commercial value
of their findings and are seeking patent protection and licensing arrangements
to collect payments for the use of their technologies. These institutions also
may market competitive products on their own or through joint ventures and will
compete with us in recruiting highly qualified scientific personnel.
OUR SUCCESS WILL DEPEND ON THIRD-PARTY REIMBURSEMENT AND MAY BE IMPACTED BY
HEALTH CARE REFORM.REFORM POLICIES MAY REDUCE OUR FUTURE
SALES.
Sales of prescription drugs depend significantly on the availability of
reimbursement to the consumer from third party payors,payers, such as government and
private insurance plans. These third party payorspayers frequently require drug
companies to provide predetermined discounts from list prices, and they are
increasingly challenging the prices charged for medical products and services.
Our current and potential products may not be considered cost-effective and
reimbursement to the consumer may not be available or sufficient to allow us to
sell our products on a competitive basis. For example we have current and
recurring discussions with insurers regarding reimbursement rates for our drugs,
including Avinza which was recently approved for marketing. We may not be able
to negotiate favorable reimbursement rates for our products, or may have to pay
significant discounts to obtain favorable rates. Only one of our products,
ONTAK, is currently eligible to be reimbursed by Medicare.
In addition, the efforts of governments and third party payorsthird-party payers to contain
or reduce the cost of health care will continue to affect the business and
financial condition of drug companies such as us. A number of legislative and
regulatory proposals to change the health care system have been discussed in
recent years.years, including price caps and controls for pharmaceuticals. These
proposals could reduce and/or cap the prices for our products or reduce
government reimbursement rates for products such as ONTAK. In addition, an
increasing emphasis on managed care in the United States has and will continue
to increase pressure on drug pricing. We cannot predict whether
6
legislative or regulatory proposals will be adopted or what effect those
proposals or managed care efforts may have on our business. The announcement
and/or adoption of such proposals or efforts could adversely affect our profit
margins and business.
WE RELY HEAVILY ON COLLABORATIVE RELATIONSHIPS AND TERMINATION OF ANY OF THESE
PROGRAMS COULD REDUCE THE FINANCIAL RESOURCES AVAILABLE TO US.
Our strategy for developing and commercializing many of our potential
products, including products aimed at larger markets, includes entering into
collaborations with corporate partners, licensors, licensees and others. To date, we have entered into collaborations
with Bristol-Myers Squibb Company, Organon Company, Warner-Lambert Company, Eli
Lilly and Company, SmithKline Beecham Corporation, American Home Products,
Abbott Laboratories, Sankyo Company Ltd., Glaxo-Wellcome plc, Allergan, Inc.,
and Pfizer Inc. These
collaborations provide us with funding and research and development resources
for potential products for the treatment or control of metabolic diseases,
hematopoiesis, women's health disorders, inflammation, cardiovascular disease,
cancer and skin disease, and osteoporosis. These agreements also give our
collaborative partners significant discretion when deciding whether or not to
pursue any development program. Our collaborations may not continue or be
successful.
7
In addition, our collaborators may develop drugs, either alone or with
others, that compete with the types of drugs they currently are developing with
us. This would result in less support and increased competition for our
programs. If products are approved for marketing under our collaborative
programs, any revenues we receive will depend on the manufacturing, marketing
and sales efforts of our collaborators, who generally retain commercialization
rights under the collaborative agreements. Our current collaborators also
generally have the right to terminate their collaborations under specified
circumstances. If any of our collaborative partners breach or terminate their
agreements with us or otherwise fail to conduct their collaborative activities
successfully, our product development under these agreements will be delayed or
terminated.
We may have disputes in the future with our collaborators, including
disputes concerning which of us owns the rights to any technology developed. For
instance, we were involved in litigation with Pfizer, which we settled in April
1996, concerning our right to milestones and royalties based on the development
and commercialization of droloxifene. These and other possible disagreements
between us and our collaborators could delay our ability and the ability of our
collaborators to achieve milestones or our receipt of other payments. In
addition, any disagreements could delay, interrupt or terminate the
collaborative research, development and commercialization of certain potential
products, or could result in litigation or arbitration. The occurrence of any of
these problems could be time-consuming and expensive and could adversely affect
our business.
OUR SUCCESS DEPENDS ON OUR ABILITYCHALLENGES TO, OBTAIN AND MAINTAIN OUROR FAILURE TO SECURE PATENTS AND OTHER PROPRIETARY RIGHTS.RIGHTS MAY
SIGNIFICANTLY HURT OUR BUSINESS.
Our success will depend on our ability and the ability of our licensors to
obtain and maintain patents and proprietary rights for our potential products
and to avoid infringing the proprietary rights of others, both in the United
States and in foreign countries. Patents may not be issued from any of these
applications currently on file or, if issued, may not provide sufficient
protection. In addition, disputes with licensors under our license agreements
may arise which could result in additional financial liability or loss of
important technology and potential products.
Our patent position, like that of many pharmaceutical companies, is
uncertain and involves complex legal and technical questions for which important
legal principles are unresolved. We may not develop or obtain rights to products
or processes that are patentable. Even if we do obtain patents, they may not
adequately protect the technology we own or have licensed. In addition, others
may challenge, seek to invalidate, infringe or circumvent any patents we own or
license, and rights we receive under those patents may not provide competitive
advantages to us. Further, the manufacture, use or sale of our products may
infringe the patent rights of others.
Several drug companies and research and academic institutions have
developed technologies, filed patent applications or received patents for
technologies that may be related to our business. Others have filed patent
applications and received patents that conflict with patents or patent
applications we have licensed for our use, either by claiming the same methods
or compounds or by claiming methods or compounds that could dominate those
licensed to us. In addition, we may not be aware of all patents or patent
applications that may impact our ability to make, use or sell any of our
potential products. For example, United States patent applications may be kept
confidential while pending in the Patent and Trademark Office, and patent
applications filed in foreign countries are often first published six months or
more after filing. Any conflicts resulting from the patent rights of others
could significantly reduce the coverage of our patents and limit our ability to
obtain meaningful patent protection. While
7
we routinely receive communications or have conversations with the owners of
other patents, none of these third parties have directly threatened an action or
claim against us. If other companies obtain patents with conflicting claims, we
may be required to obtain licenses to those patents or to develop or obtain
alternative technology. We may not be able to obtain any such licenselicenses on
acceptable terms or at all. Any failure to obtain such licenses could delay or
prevent us from pursuing the development or commercialization of our potential
products.
We have had and will continue to have discussions with our current and
potential collaborators regarding the scope and validity of our patent and other
proprietary rights. If a collaborator or other party successfully establishes
that our patent rights are invalid, we may not be able to continue our existing
collaborations beyond their expiration. Any determination that our patent rights
are invalid also could encourage our collaborators to terminate their agreements
where contractually permitted. Such a determination could also adversely affect
our ability to enter into new collaborations.
We may also need to initiate litigation, which could be time-consuming and
expensive, to enforce our proprietary rights or to determine the scope and
validity of others' rights. If litigation results, a court may find our 8
patents
or those of our licensors invalid or may find that we have infringed on a
competitor's rights. If any of our competitors have filed patent applications in
the United States which claim technology we also have invented, the Patent and
Trademark Office may require us to participate in expensive interference
proceedings to determine who has the right to a patent for the technology.
We have learned that Hoffmann-La Roche Inc. has received a United States
patent and has made patent filings in foreign countries that relate to our
Panretin capsules and gel products. We filed a patent application with an
earlier filing date than Hoffmann-La Roche's patent, which we believe is broader
than, but overlaps in part with, Hoffmann-La Roche's patent. We currentlybelieve we were
the first to invent the relevant technology and therefore are investigatingentitled to a
patent on the scope and validity of Hoffmann-La Roche's patent to determine
its impact upon our products.application we filed. The Patent and Trademark Office has informed us
that the overlapping claims are patentable to us and has
initiated a proceeding to determine whether we or Hoffmann-La Roche are entitled
to a patent. We may not receive a favorable outcome in the proceeding. In
addition, the proceeding may delay the Patent and Trademark Office's decision
regarding our earlier application. If we do not prevail, the Hoffmann-La Roche
patent might block our use of Panretin capsules and gel in specified cancers.
We have also learned that Novartis AG has filed an opposition to our
European patent that covers the principal active ingredient of our ONTAK drug.
We are currently investigating the scope and merits of this opposition. If the
opposition is successful, we could lose our ONTAK patent protection in Europe
which could substantially reduce our future ONTAK sales in that region. We could
also incur substantial costs in asserting our rights in this opposition
proceeding, as well as in other interference proceedings in the United States.
We also rely on unpatented trade secrets and know-how to protect and
maintain our competitive position. We require our employees, consultants,
collaborators and others to sign confidentiality agreements when they begin
their relationship with us. These agreements may be breached and we may not have
adequate remedies for any breach. In addition, our competitors may independently
discover our trade secrets.
WE RELYRELIANCE ON THIRD-PARTY MANUFACTURERS TO SUPPLY OUR PRODUCTS RISKS SUPPLY
INTERRUPTION OR CONTAMINATION AND THUS HAVE LITTLE
CONTROL OVER OUR MANUFACTURING RESOURCES.DIFFICULTY CONTROLLING COSTS.
We currently have no manufacturing facilities and we rely on others for
clinical or commercial production of our marketed and potential products. In
addition, certain raw materials necessary for the commercial manufacturing of
our products are custom and must be obtained from a specific sole source. Elan
manufactures Avinza for us, CoPharma manufactures ONTAK for us and RP Scherer
and Raylo manufacture Targretin capsules for us.
To be successful, we will need to ensure continuity of the manufacture of
our products, either directly or through others, in commercial quantities, in
compliance with regulatory requirements and at acceptable cost. Any extended and
unplanned manufacturing shutdowns could be expensive and could result in
inventory and product shortages. IfWhile we are unablebelieve that we would be able to
develop our own facilities or contract with others for manufacturing services
with respect to all of our products, if we are unable to do so our revenues
could be adversely affected. In addition, if we are unable to supply products in
development, our ability to conduct preclinical testing and human clinical
trials will be adversely affected. This in turn could also delay our submission
of products for regulatory approval and our initiation of new development
programs. In addition, although other companies have manufactured
8
drugs acting through IRs and STATs on a commercial scale, we may not be able to
do so at costs or in quantities to make marketable products.
The manufacturing process also may be susceptible to contamination, which
could cause the affected manufacturing facility to close until the contamination
is identified and fixed. In addition, problems with equipment failure or
operator error also could cause delays in filling our customers' orders.
OUR BUSINESS EXPOSES US TO PRODUCT LIABILITY RISKS OR OUR PRODUCTS MAY NEED TO
BE RECALLED AND WE MAY NOT HAVE SUFFICIENT INSURANCE TO COVER ANY CLAIMS.
Our business exposes us to potential product liability risks. Our products
also may need to be recalled to address regulatory issues. A successful product
liability claim or series of claims brought against us could result in payment
of significant amounts of money and divert management's attention from running
the business. Some of the compounds we are investigating may be harmful to
humans. For example, retinoids as a class are known to contain compounds which
can cause birth defects. We may not be able to maintain our insurance on
acceptable terms, or our insurance may not provide adequate protection in the
case of a product liability claim. To the extent that product liability
insurance, if available, does not cover potential claims, we will be required to
self-insure the risks associated with such claims. 9
WE ARE DEPENDENT ON OUR KEY EMPLOYEES, THE LOSS OF WHOSE SERVICES COULD
ADVERSELY AFFECT US.
We depend on our key scientific and management staff, the loss of whose
services could adversely affect our business. Furthermore,believe that we may need to hire
new scientific, management and operational personnel. Recruiting and retaining
qualified management, operations and scientific personnel is also critical to
our success. We may not be able to attract and retain such personnel on
acceptable terms given the competition among numerous drug companies,
universities and other research institutionscarry
reasonably adequate insurance for such personnel.product liability claims.
WE USE HAZARDOUS MATERIALS WHICH REQUIRES US TO INCUR SUBSTANTIAL COSTS TO
COMPLY WITH ENVIRONMENTAL REGULATIONS.
In connection with our research and development activities, we handle
hazardous materials, chemicals and various radioactive compounds. To properly
dispose of these hazardous materials in compliance with environmental
regulations, we are required to contract with third parties at substantial cost
to us. Our annual cost of compliance with these regulations is approximately
$600,000. We cannot completely eliminate the risk of accidental contamination or
injury from the handling and disposing of hazardous materials, whether by us or
by our third-party contractors. In the event of any accident, we could be held
liable for any damages that result, which could be significant. OUR SHAREHOLDER RIGHTS PLAN AND CHARTER DOCUMENTS MAY PREVENT TRANSACTIONS THAT
COULD BE BENEFICIAL TO YOU.
Our shareholder rights plan and provisions contained in our certificate of
incorporation and bylaws may discourage transactions involving an actual or
potential change in our ownership, including transactions in which you might
otherwise receive a premiumWe believe that
we carry reasonably adequate insurance for your shares over then-current market prices.
These provisions also may limit your ability to approve transactions that you
deem to be in your best interests. In addition, our board of directors may issue
shares of preferred stock without any further action by you. Such issuances may
have the effect of delaying or preventing a change in our ownership.
RISKS RELATING TO AN INVESTMENT IN OUR COMMON STOCK
THE MARKET PRICE OFtoxic tort claims.
OUR STOCK IS HIGHLY VOLATILE, AND, AS A RESULT, YOUR
INVESTMENTPRICE MAY BE ADVERSELY AFFECTED BY VOLATILITY IN US COULD RAPIDLY LOSE ITS VALUE.THE MARKETS.
The market prices and trading volumes for our securities, and the
securities of emerging companies like us, have historically been highly volatile
and have experienced significant fluctuations unrelated to operating
performance. For example, since January 1, 2000, the daily last reported sale
price of our common stock on the Nasdaq National Market has been as high as
$25.43 and as low as $7.85. Future announcements concerning us or our
competitors may impact the market price of our common stock. These announcements
might include:
o the results of research or development testing of ours or our competitors'
products,
o technological innovations related to diseases we are studying,
o new commercial products introduced by our competitors,
o government regulation of our industry,
o receipt of regulatory approvals by competitors,
o our failure to receive regulatory approvals for products under development,
o developments concerning proprietary rights,
or
10
o litigation or public concern about the safety of our products.products, or
o intent to sell or actual sale of our stock held by our corporate partners.
9
FUTURE SALES OF OUR COMMON STOCK MAY DEPRESS OUR STOCK PRICE.
Sales of substantial amounts of our common stock in the public market could
seriously harm prevailing market prices for our common stock. These sales might
make it difficult or impossible for us to sell additional securities when we
need to raise capital.
YOU MAY NOT RECEIVE A RETURN ON YOUR SHARES OTHER THAN THROUGH THE SALE OF YOUR
SHARES OF COMMON STOCKSTOCK.
We have not paid any cash dividends on our common stock to date. We intend
to retain any earnings to support the expansion of our business and we do not
anticipate paying cash dividends in the foreseeable future. Accordingly, other
than through a sale of your shares, you will not receive a return on your
investment in our common stock.
WE MAY INCUR SIGNIFICANT COSTS FROM CLASS ACTION LITIGATION DUE TO OUR EXPECTED
STOCK VOLATILITY
As described above, our stock, price is highly volatile. Recently, when the
market price of a stock has been volatile as our stock price has been, holders
of that stock have occasionally instituted securities class action litigation
against the company that issued the stock. If any of our stockholders were to
bring a lawsuit of this type against us, even if the lawsuit is without merit,
we could incur substantial costs defending the lawsuit. The lawsuit could also
divert the time and attention of our management.
FUTURE SALES OF OUR COMMON STOCK MAY DEPRESS OUR STOCK PRICE
Future sales of substantial amounts ofyou should not rely on an investment in our
common stock if you require dividend income.
OUR SHAREHOLDER RIGHTS PLAN AND CHARTER DOCUMENTS MAY HINDER OR PREVENT CHANGE
OF CONTROL TRANSACTIONS.
Our shareholder rights plan and provisions contained in our certificate of
incorporation and bylaws may discourage transactions involving an actual or
potential change in our ownership. In addition, our board of directors may issue
shares of preferred stock without any further action by you. Such issuances may
have the effect of delaying or preventing a change in our ownership. If changes
in our ownership are discouraged, delayed or prevented, it would be more
difficult for our current board of directors to be removed and replaced, even if
you or our other stockholders believe that such actions are in the public
market could seriously harm prevailing market prices forbest
interests of us and our common stock. These
sales might make it difficult or impossible for us to sell additional securities
when we need to raise capital.
11stockholders.
10
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus includes "forward-looking statements"may contain forward-looking statements that involve
substantial risks and uncertainties regarding future events or our future
performance within the meaning of Section 27A of the Securities Act of 1933, as
amended and Section 21E of the Securities Exchange Act of 1934, as amended. AllYou
can identify these statements by forward-looking words such as "may," "will,"
"expect," "intent," "anticipate," "believe," "estimate" and "continue" or
similar words. You should read statements that contain these words carefully
because they discuss our future expectations, contain projections of our future
results of operations or of our financial condition or state other
than statements of historical
facts"forward-looking" information. We believe that it is important to communicate
our future expectations to our investors. However, there may be events in the
future that we are not able to accurately predict or control. The factors listed
in the section captioned "Risk Factors," as well as any cautionary language
included in this prospectus or incorporated by reference, regardingprovide examples of
risks, uncertainties and events that may cause our
financial position and business strategy may constitute forward-looking
statements. Although we believe that the expectations reflected in these
forward-looking statements are reasonable, we can not guarantee that these
expectations will prove to be correct. Important factors that could cause actual results to differ
materially from the expectations we describe in our expectations are listedforward-looking statements.
Before you invest in our common stock, you should be aware that the occurrence
of the events described in the "Risk Factors" section and elsewhere in this
prospectus could have a material adverse effect on our business, operating
results and they include the forward-looking statements under "Risk
Factors."financial condition. All subsequent written and oral forward-looking
statements attributable to us or persons acting on our behalf are expressly
qualified in their entirety by these statements.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. You may read and copy any document we file at the
SEC's public reference rooms at 450 Fifth Street, N.W., Washington, D.C. 20549,
and also at the SEC's public reference rooms in New York, New York and Chicago,
Illinois. Please call the SEC at 1-800-SEC-0330 for further information on the
public reference rooms. Our SEC filings are also available to the public on the
SEC's website at http://www.sec.gov.
1211
INFORMATION INCORPORATED BY REFERENCE
The SEC allows us to incorporate by reference the information we file with
them, which means that we can disclose important information to you by referring
you to those documents. The information incorporated by reference is considered
to be part of this prospectus, and later information filed with the SEC will
update and supersede this information. We incorporate by reference the documents
listed below and any future filings we make with the SEC under Section 13(a),
13(c), 14, or 15(d) of the Securities Exchange Act of 1934 until our offering is
completed:
o Our annual report on Form 10-K for the fiscal year ended December 31, 1999,
including specified information in our definitive proxy statement in
connection with our 2000 annual meeting of stockholders.2001.
o Our quarterly reportsreport on Form 10-Q for the quarterly periodsperiod ended March 31,
2000, June 30, 2000 and September 30, 2000.2002.
o Our current reports on Form 8-K filed November 6, 2000, JanuaryApril 1, 2002, April 4, 20012002 and
January 8, 2001.April 12, 2002.
o The description of our common stock, contained in our registration
statement on Form 8-A filed on November 21, 1994, including any amendments
or reports filed for the purpose of updating such descriptions.
o The description of our preferred stock purchase rights, contained in our
registration statement on Form 8-A filed on September 30, 1996, including
any amendments or reports filed for the purpose of updating such
descriptions.
The reports and other documents that we file after the date of this
prospectus will update and supersede the information in this prospectus.
You may request a copy of these filings, at no cost, by writing or
telephoning us at:
Ligand Pharmaceuticals Incorporated
Attn: Investor Relations
10275 Science Center Road
San Diego, California 92121-1117
(858) 550-7500
YOU SHOULD RELY ONLY ON THE INFORMATION PROVIDED OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH
DIFFERENT INFORMATION. THE SELLING STOCKHOLDERS ARE NOT AUTHORIZED TO MAKE AN
OFFER OF THESE SECURITIES IN ANY STATE WHERE THE OFFER IS NOT PERMITTED. YOU
SHOULD NOT ASSUME THAT THE INFORMATION IN THIS PROSPECTUS IS ACCURATE AS OF ANY
DATE OTHER THAN THE DATE ON THE FRONT OF THE DOCUMENT.
1312
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of the shares of our
common stock by the selling stockholders.
PLAN OF DISTRIBUTION
We are registering all 2,000,0004,252,500 shares on behalf of the selling
stockholders. We issued all of the shares to the selling stockholders in a
private placement transaction. The selling stockholders named in the table below
or pledgees, donees, transferees or other successors-in-interestsuccessors in interest selling shares
received from a named selling stockholder as a gift, pledge, partnership
distribution or other non-sale related transfer after the date of this
prospectus may sell the shares from time to time. The selling stockholders will
act independently of us in making decisions regarding the timing, manner and
size of each sale. The sales may be made on The Nasdaq Stock Market or in the
over-the-counter market or otherwise, at prices and at terms then prevailing or
at prices related to the then-current market price, or in negotiated
transactions. The selling stockholders may effect these transactions by selling
the shares to or through broker-dealers. The shares may be sold by one or more
of, or a combination of, the following:
o a block trade in which the broker-dealer will attempt to sell the shares as
agent but may position and resell a portion of the block as principal to
facilitate the transaction,
o purchases by a broker-dealer as principal and resale by such broker-dealer
for its account under this prospectus,
o an exchange distribution in accordance with the rules of the respective
exchange,
o ordinary brokerage transactions and transactions in which the broker
solicits purchasers,
ando an over-the-counter distribution in accordance with the rules of The Nasdaq
National Market,
o in privately negotiated transactions, and
o in options transactions.
To the extent required, this prospectus may be amended or supplemented from
time to time to describe a specific plan of distribution. In effecting sales,
broker-dealers engaged by the selling stockholders may arrange for other
broker-dealers to participate in the resales.
The selling stockholders may enter into hedging transactions with
broker-dealers or other financial institutions in connection with distributions
of the shares or otherwise. In connection with these transactions, broker-dealersbroker
dealers or other financial institutions may engage in short sales of the shares
in the course of hedging the positions they assume with selling stockholders.
The selling stockholders also may sell shares short and redeliver the shares to
close out such short positions. The selling stockholders may enter into option
or other transactions with broker-dealers which require the delivery to the
broker-dealer of the shares. The broker-dealer may then resell or otherwise
transfer such shares covered by this prospectus.prospectus (as supplemented or amended to
reflect such transaction). The selling stockholders also may loan or pledge the
shares to a broker-dealer.broker-dealer or other financial institution. The broker-dealer may
sell the shares so loaned, or upon a default the broker-dealer may sell the
pledged shares under this prospectus.prospectus (as supplemented or amended to reflect such
transaction). Broker-dealers or agents may receive compensation in the form of
commissions, discounts or concessions from selling stockholders. Broker-dealers
or agents may also receive compensation from the purchasers of the shares for
whom they act as agents or to whom they sell as principals, or both.
Compensation as to a particular broker-dealer might be in excess of customary
commissions and will be in amounts to be negotiated in connection with the sale.
Broker-dealers or agents and any other participating broker-dealers or the
selling stockholders may be deemed to be underwriters within the meaning of
Section 2(11) of the Securities Act of 1933 in connection with sales of the
shares. Accordingly, any such commission, discount or concession received by
them and any profit on the resale of the shares purchased by them may be deemed
to be underwriting discounts or commissions under the Securities Act. Because
selling stockholders may be deemed to be
13
underwriters within the meaning of Section 2(11) of the Securities Act, the
selling stockholders will be subject to the prospectus delivery requirements of
the Securities Act. In addition, any securities covered by this prospectus which
qualify for sale in compliance with Rule 144 promulgated under the Securities
Act may be sold under Rule 144 rather than under this prospectus. The selling
stockholders have advised us that they
14
have not entered into any agreements,
understandings or arrangements with any underwriters or broker-dealers regarding
the sale of their securities. There is no underwriter or coordinating broker
acting in connection with the proposed sale of shares by the selling
stockholders.
The shares will be sold only through registered or licensed brokers or
dealers if required under applicable state securities laws. In addition, in
certain states the shares may not be sold unless they have been registered or
qualified for sale in the applicable state or an exemption from the registration
or qualification requirement is available and is complied with.
Under applicable rules and regulations under the Securities Exchange Act of
1934, any personpersons engaged in the distribution of the shares may not
simultaneouslybe limited in their
ability to engage in market making activities with respect to our common
stock for a period of two business days prior to the commencement of such distribution.shares. In addition,
each selling stockholder will be subject to applicable provisions of the
Exchange Act and the associated rules and regulations under the Exchange Act,
including Regulation M, which provisions may limit the timing of purchases and
sales of shares of our common stock by the selling stockholders. We will make
copies of this prospectus available to the selling stockholders and have
informed them of the need to deliver copies of this prospectus to purchasers at
or prior to the time of any sale of the shares.
We will file a supplement to this prospectus, if required, to comply with
Rule 424(b) under the Securities Act, upon being notified by a selling
stockholder that any material arrangements have been entered into with a
broker-dealer for the sale of shares through a block trade, special offering,
exchange distribution or secondary distribution or a purchase by a broker or
dealer. Such supplement will disclose:
o the name of each such selling stockholder and of the participating
broker-dealer(s),
o the number of shares involved,
o the price at which such shares were sold,
o the commissions paid or discounts or concessions allowed to such
broker-dealer(s), where applicable,
o that such broker-dealer(s) did not conduct any investigation to verify the
information set out or incorporated by reference in this prospectus, and
o other facts material to the transaction.
In addition, upon being notified by a selling stockholder that a donee or
pledgee intends to sell more than 500 shares, we will file a supplement to this
prospectus.
We will bear all costs, expenses and fees in connection with the
registration of the shares, other than fees and expenses, if any, of counsel or
other advisers to the selling stockholders. In addition, the selling
stockholders will bear all commissions and discounts, if any, attributable to
the sales of the shares. The selling stockholders may agree to indemnify any
broker-dealer or agent that participates in transactions involving sales of the
shares against various liabilities, including liabilities arising under the
Securities Act. We have agreed to indemnify the selling stockholders against
various liabilities in connection with the offering of the shares, including
liabilities arising under the Securities Act. The selling stockholders have
agreed to indemnify us, our directors and officers who sign the registration
statement of which this prospectus forms a part, and control persons against
various liabilities in connection with the offering of the shares, including
liabilities arising under the Securities Act.
15We have agreed with the selling stockholders to keep the registration
statement of which this prospectus constitutes a part effective until the
earlier of (i) April 19, 2004, (ii) the date on which the selling stockholders
may sell all shares covered by this prospectus without restriction pursuant to
Rule 144(k) under the Securities Act of 1933 or (iii) such time as all shares
covered by this prospectus have been sold pursuant to and in accordance with the
registration statement.
14
SELLING STOCKHOLDERS
The following table sets forth the number of shares owned by each of the
selling stockholders. This registration statement also shall cover any
additional shares of common stock which become issuable in connection with the
shares registered for sale hereby by reason of any stock dividend, stock split,
recapitalization or other similar transaction effected without the receipt of
consideration which results in an increase in the number of our outstanding
shares of common stock.
Other than Elan Corporation and its affiliates, noneNone of the selling stockholders has had a material relationship with us
within the past three years other than as a result of the ownership of the
shares or other securities of ours.
An affiliate of Elan Corporation is participating in this offering as a selling
stockholder. In 1998, we entered into a strategic alliance with Elan and one of
its affiliates, which we collectively refer to as Elan, to license exclusive
rights to market Elan's proprietary product Morphelan in the U.S. and Canada for
pain management in cancer and HIV patients. We also have an option to co-promote
Morphelan in continental Europe for the same indications. Since September 1998,
as part of our strategic alliance and under related securities purchase
agreements, we have issued to Elan an aggregate of 3,011,549 shares of our
common stock and $110 million issue price of notes convertible into shares of
our common stock. In December 1999 and March 2000, Elan converted an aggregate
of $40 million issue price of these convertible notes plus accrued interest,
together with conversion incentives, for which it received an aggregate of
4,033,155 additional shares of our common stock.
In addition, under the strategic alliance, Elan has the right to maintain
its proportionate level of ownership of our stock in connection with specified
offerings of our common stock. In 1999, in connection with this right, Elan
purchased 52,742 additional shares of our common stock and warrants to purchase
91,406 additional shares of our common stock. Elan also purchased 416,667
additional shares of our common stock in connection with the sale of
unregistered shares of our common stock completed on January 10, 2001, which
shares are being registered in connection with this registration statement. As a
result, as of the date of this prospectus, and prior to any sales under this
prospectus, Elan beneficially owns an aggregate of 12,886,408 shares of our
common stock, assuming conversion of all outstanding warrants and notes,
representing approximately 18.6% of our common stock on a fully diluted basis.
We do not know when or in what amounts the selling stockholders may offer
shares for sale. The selling stockholders may decide not to sell all or any of
the shares that this prospectus covers. The shares offered by this prospectus
may be offered from time to time by the selling stockholders named below.
Because the selling stockholders may offer all or some of the shares pursuant to
this offering, and because there are currently no agreements, arrangements or
understandings with respect to the sale of any of the shares that the selling
stockholders will hold after completion of the offering, we cannot estimate the
number of shares that the selling stockholders will hold after completion of the
offering.
SHARES BENEFICIALLY
OWNED PRIOR TO THIS OFFERING
---------------------------------------------
PERCENTAGE OF COMMON NUMBER OF SHARES OF
NAME OF STOCK OUTSTANDING COMMON STOCK
SELLING STOCKHOLDER NUMBER REGISTERED HEREBY
- ----------------------------------- -------------------- -------------------- --------------------
BaystarBanque Carnegie Luxembourg 222,000 * 62,000
Banque Carnegie Luxembourg FCP Funds 343,352 * 238,000
Biocentive Limited 31,000 * 31,000
Caduceus Capital LLP 93,750II, L.P. 150,000 * 93,750
Baystar International 31,250150,000
HBM Bioventures (Cayman) Ltd. 300,000 * 31,250
Domain Public Equity Partners300,000
Interdynamic Fund - BioMed Tech 31,000 * 31,000
Merlin BioMed, L.P. 200,00050,000 * 200,000
Elan International Services, LTD 7,514,113 12.8% 416,66750,000
Merlin BioMed II, L.P. 34,50028,000 * 34,50028,000
Merlin BioMed INT'L LTD 156,000III, L.P. 16,000 * 156,00016,000
Merlin BioMed International, Ltd. 94,000 * 94,000
Moore Global Investments, Ltd. 420,000 * 420,000
Nordea Global Biotech Fund 57,000 * 30,000
Nordea Medica Life Science Fund 70,000 * 60,000
Putnam Funds Trust - Putnam New 206,100 * 32,100
Century Growth Fund
Putnam New Opportunities Fund 564,500 * 564,500
1615
Merlin BioMedPutnam Variable Trust - Putnam VT New 112,300 * 112,300
Opportunities Fund
Putnam Variable Trust - Putnam VT 5,840 * 900
Voyager Fund
Putnam Voyager Fund II 429,000 * 67,000
Putnam World Trust II - Putnam New 4,000 * 4,000
Opportunities (U.S. Aggressive Growth
Equity) Fund (Dublin)
PW Eucalyptus Fund, L.L.C. 345,000 * 345,000
PW Eucalyptus Fund, Ltd. 45,000 * 45,000
Remington Investment Strategies, LP 102,00080,000 * 102,000
Narragansett I, LP 119,00080,000
Saks MedScience Fund 30,000 * 85,000
Narragansett30,000
SF Capital Partners Ltd. 125,000 * 125,000
UBS O'Connor LLC F/B/O O'Connor PIPES 400,000 * 400,000
Corporate Strategies Ltd.
Ursus Capital, L.P. 35,600 * 35,600
Ursus Offshore, Ltd. 231,00041,100 * 165,000
Royal Bank of Canada 250,00041,100
Vertical International Limited 343,750 * 250,000
S.A.C.343,750
Vertical Ventures Investments, LLC 206,250 * 206, 250
Winchester Global Trust Company 310,000 * 310,000
Limited as Trustee for Caduceus ------- -------
Capital Associates, LLC 375,000 * 375,000
TAIB Funds, LTD 7,500 * 7,500
United Capital Management, Inc. 83,333 * 83,333
---------- ------------Trust
TOTAL: 9,197,446 2,000,000
========== ============5,095,792 4,252,500
========= =========
* Indicates less than 1%
16
LEGAL MATTERS
The validity of the securities offered hereby will be passed upon by
Brobeck, Phleger & Harrison LLP, San Diego, California. Members ofAttorneys associated
with Brobeck, Phleger & Harrison LLP own a total of 1,375 shares of our class B common stock
and 5,7818,827 shares of our common
stock.
EXPERTS
ErnstThe consolidated financial statements for the years ended December 31, 2001
and 2000 incorporated in this prospectus by reference from our Annual Report on
Form 10-K for the year ended December 31, 2001 have been audited by Deloitte &
YoungTouche LLP, independent auditors, as stated in their report, which is
incorporated herein by reference (which report expresses an unqualified opinion
and includes an explanatory paragraph referring to a change in accounting
principle), and have audited ourbeen so incorporated in reliance upon the report of such
firm given upon their authority as experts in accounting and auditing.
The consolidated financial statements includedincorporated by reference in our
annual reportAnnual Report on Form 10-K for the year ended December 31, 1999 have been
audited by Ernst & Young LLP, independent auditors, as set forth in their report
which isthereon included therein and incorporated herein by reference in this prospectus. Ourreference. Such consolidated
financial statements are incorporated herein by reference in reliance upon Ernst & Young LLP's reports,such
report given on theirthe authority of such firm as experts in accounting and
auditing.
WE HAVE NOT AUTHORIZED ANY PERSON TO MAKE A STATEMENT THAT DIFFERS FROM WHAT IS
IN THIS PROSPECTUS. IF ANY PERSON DOES MAKE A STATEMENT THAT DIFFERS FROM WHAT
IS IN THIS PROSPECTUS, YOU SHOULD NOT RELY ON IT. THIS PROSPECTUS IS NOT AN
OFFER TO SELL, NOR IS IT AN OFFER TO BUY, THESE SECURITIES IN ANY STATE IN WHICH
THE OFFER OR SALE IS NOT PERMITTED. THE INFORMATION IN THIS PROSPECTUS IS
COMPLETE AND ACCURATE AS OF ITS DATE, BUT THE INFORMATION MAY CHANGE AFTER THAT
DATE.
17
2,000,0004,252,500 SHARES
LIGAND PHARMACEUTICALS INCORPORATED
COMMON STOCK
----------------------------------
Prospectus
----------------------------------
JANUARY 19, 2001JUNE 6, 2002
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth all expenses, other than underwriting
discounts and commissions, payable by the registrant in connection with the sale
of the common stock being registered. All the amounts shown are estimates,
except for the SEC registration fee.
SEC registration fee................................. $ 6,100$6,639.18
---------
Printing and engraving expenses......................expenses ..................... 5,000
---------
Nasdaq additional listing fee........................ 17,50022,500
---------
Legal fees and expenses.............................. 50,000
---------
Accounting fees and expenses......................... 25,000
---------
Transfer agent and registrar fee.....................fee .................... 5,000
---------
Miscellaneous expenses............................... 10,000
---------
TOTAL $ 118,600
=========$124,139.18
===========
ITEM 15. INDEMNIFICATION OF OFFICERS AND DIRECTORS.
Under Section 145 of the Delaware General Corporation Law, we have broad
powers to indemnify our directors and officers against liabilities they may
incur in such capacities, including liabilities under the Securities Act.
Our amended and restated certificate of incorporation provides for the
indemnification of all persons to the fullest extent permissible under Delaware
law.
Our amended and restated by-laws provides for the indemnification of
officers, directors and third parties acting on our behalf if such person acted
in good faith and in a manner reasonably believed to be in and not opposed to
our best interest, and, with respect to any criminal action or proceeding, the
indemnified party had no reason to believe his or her conduct was unlawful.
We maintain directors and officers insurance providing indemnification for
certain of our directors and officers for certain liabilities.
We also entered into indemnification agreements between us and our
directors and officers, which may be sufficiently broad to permit
indemnification of our officers and directors for liabilities arising under the
1933Securities Act.
In connection with the January 2001our April 2002 private placement, the Company agreed to
indemnify the selling stockholders and its controlling persons, as defined in
the Securities Act, of 1933, against liabilities, including legal fees, that the selling
stockholders or their controlling persons may incur under the Securities Act,
the Exchange Act, or any other federal or state statutory law or regulation, or
at common law or otherwise in connection with this registration statement,
including the prospectus, financial statements and schedules, and amendments and
supplements to those documents, except liabilities related to misstatements or
omissions made in the registration statement in conformity with written
information furnished to the Company by or on behalf of the selling stockholders
expressly for use in the registration statement or prospectus or any breach or
violation of the representations and warranties of the selling stockholders
under the purchase agreementagreements between the Company and the selling stockholderstockholders
dated as of January 5, 2001.April 17, 2002.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933
may be permitted to directors, officers or persons controlling us pursuant to
the foregoing provisions, we have been informed that in the opinion of the Securities and Exchange CommissionSEC
such indemnification is against public policy as expressed in the Securities Act
and is therefore unenforceable.
II-1
ITEM 16. EXHIBITS.
(a) EXHIBITS.
EXHIBIT NO. DESCRIPTION
- ----------- -----------
4.1 Instruments defining the rights of stockholders. Reference is
made to our Form 8-A registration statement filed on November 21,
1994 (incorporated into this registration statement by
reference), the Amended and Restated Certificate of Incorporation
(incorporated into this registration statement by reference to
Exhibit 3.2 to our Form S-4 registration statement filed on July
9, 1998), the Bylaws (incorporated into this registration
statement by reference to Exhibit 3.3 of our Form S-4
registration statement, filed on July 9, 1998), the Amended
Certificate of Designation of Rights, Preferences and Privileges
of Series A Participating Preferred Stock (incorporated into this
registration statement by reference to Exhibit 3.3 to our
quarterly report on Form 10-Q for the period ended March 31,
1999) and our FormsForm 8-A registration statementsstatement filed on December 24, 1998, November 10, 1998 and September
30, 1996.
5.11996, including any amendments or reports filed for the
purposes of updating such descriptions.
5.1(1) Opinion of Brobeck, Phleger & Harrison LLP
23.1 Consent of Deloitte & Touche LLP, Independent Auditors
23.2 Consent of Ernst & Young LLP, Independent Auditors
23.223.3(1) Consent of Brobeck, Phleger & Harrison LLP. Included in the
Opinion of Brobeck, Phleger & Harrison LLP filed as Exhibit 5.1
24.1 Power of Attorney. Included on page II-5 of this registration
statement.Attorney
- -----------------------------------
(1)......Previously filed.
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement to include any material
information with respect to the plan of distribution not previously disclosed in
the registration statement or any material change to such information in the
registration statement;
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof;
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer, or controlling
person of the registrant in the successful defense of any action, suit, or
proceeding) is asserted by such director, officer, or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question of whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
II-2
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of San Diego, State of California, on January 19, 2001.June 6, 2002.
LIGAND PHARMACEUTICALS INCORPORATED
By: /s/ David E. Robinson
--------------------------------------------------------------------------
David E. Robinson, President
and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints David E. Robinson and Paul V.
Maier and each of them acting individually, as his or her attorney-in-fact, each
with full power of substitution and resubstitution, for him or her in any and
all capacities, to sign any and all amendments to this Registration Statement
(including post-effective amendments), and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorneys-in-fact full power and
authority to do and perform each and every act and thing requisite and necessary
to be done in connection therewith as fully to all intents and purposes as he or
she might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact, or their substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:
SIGNATURE TITLE DATE
--------- ----- ----
/s/ David E. Robsinson January 19, 2001Robinson June 6, 2002
- --------------------------------------------------------------------------
David E. Robinson President and Chief Executive Officer
(Principal Executive Officer)
/s/ Paul V. Maier January 19, 2001June 6, 2002
- --------------------------------------------------------------------------
Paul V. Maier Senior Vice President
and Chief Financial Officer
(Principal Financial and Accounting Officer)
/s/ Henry F. Blissenbach January 12, 2001* June 6, 2002
- --------------------------------------------------------------------------
Henry F. Blissenbach Director
/s/ January ___, 2001* June 6, 2002
- --------------------------------------------------------------------------
Alexander D. Cross Director
/s/ Michael A. Rocca January 12, 2001* June 6, 2002
- --------------------------------------------------------------------------
Michael A. Rocca Director
/s/ John Groom January 15, 2001* June 6, 2002
- --------------------------------------------------------------------------
John Groom Director
/s/ Irving S. Johnson January 19, 2001* June 6, 2002
- --------------------------------------------------------------------------
Irving S. Johnson, Ph.D. Director
/s/ Carl C. Peck January 12, 2001* June 6, 2002
- --------------------------------------------------------------------------
Carl C. Peck Director
II-3* By: /S/ PAUL V. MAIER
------------------------------------
Paul V. Maier
Attorney-in-Fact
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
- ----------- -----------
4.1 Instruments defining the rights of stockholders. Reference is
made to our Form 8-A registration statement filed on November 21,
1994 (incorporated into this registration statement by
reference), the Amended and Restated Certificate of Incorporation
(incorporated into this registration statement by reference to
Exhibit 3.2 to our Form S-4 registration statement filed on July
9, 1998), the Bylaws (incorporated into this registration
statement by reference to Exhibit 3.3 of our Form S-4
registration statement, filed on July 9, 1998), the Amended
Certificate of Designation of Rights, Preferences and Privileges
of Series A Participating Preferred Stock (incorporated into this
registration statement by reference to Exhibit 3.3 to our
quarterly report on Form 10-Q for the period ended March 31,
1999) and our FormsForm 8-A registration statementsstatement filed on December 24, 1998, November 10, 1998 and September
30, 1996.
5.11996, including any amendments or reports filed for the
purposes of updating such descriptions.
5.1(1) Opinion of Brobeck, Phleger & Harrison LLP
23.1 Consent of Deloitte & Touche LLP, Independent Auditors
23.2 Consent of Ernst & Young LLP, Independent Auditors
23.223.3(1) Consent of Brobeck, Phleger & Harrison LLP. Included in the
Opinion of Brobeck, Phleger & Harrison LLP filed as Exhibit 5.1
24.1*24.1 Power of Attorney. Included on page II-5 of this registration
statementAttorney
- ------------------
II-4-----------------
(1)......Previously filed.