1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1996
Commission file number: 0-27406
CONNECTIVE THERAPEUTICS, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 94-3173928
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification Number)
3400 WEST BAYSHORE ROAD
PALO ALTO, CALIFORNIA 94303
(Address of principal executive offices)
Registrant's telephone number, including area code: (415) 843-2800
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for at least the past 90 days. Yes X No
--- ---
As of July 18, 1996, 7,382,904 shares of the Registrant's common stock were
outstanding, at $0.001 par value.
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CONNECTIVE THERAPEUTICS, INC.
QUARTERLY REPORT ON FORM 10-Q
FOR THE THREE MONTHS ENDED JUNE 30, 1996
TABLE OF CONTENTS
Page
----
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Balance Sheets at
June 30, 1996 and December 31, 1995............................................... 3
Condensed Statements of Operations
For the three and six months ended June 30, 1996 and 1995, and for
the period from inception (February 8, 1993) to June 30, 1996..................... 4
Condensed Statements of Cash Flows
For the six months ended June 30, 1996 and 1995, and for
the period from inception (February 8, 1993) to June 30, 1996..................... 5
Notes to Condensed Financial Statements........................................... 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations....................................... 8
PART II. OTHER INFORMATION
Item 1. Legal Proceedings................................................................... 11
Item 2. Changes in Securities............................................................... 11
Item 3. Defaults Upon Senior Securities..................................................... 11
Item 4. Submission of Matters to a Vote of Security Holders................................. 11
Item 5. Other Information................................................................... 11
Item 6. Exhibits and Reports on Form 8-K.................................................... 11
Exhibits......................................................................... 11
Reports on Form 8-K.............................................................. 12
SIGNATURE .................................................................................... 13
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CONNECTIVE THERAPEUTICS, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
JUNE 30, DECEMBER 31,
1996 1995
---------- ------------
(UNAUDITED)
ASSETS
Current assets:
Cash and cash equivalents $ 9,821 $ 9,023
Short-term investments 14,993 --
Prepaid expenses and other current assets 239 154
---------- --------
Total current assets 25,053 9,177
Property and equipment, net 1,604 1,367
Notes receivable from related parties 285 414
Deposits and other assets 297 838
========== ========
$ 27,239 $ 11,796
========== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 487 $ 441
Accrued liabilities 405 808
Accrued process development expenses 692 668
Accrued payroll and related expenses 269 157
Current portion of capital lease obligations, capital loans and long-term debt 2,491 1,259
---------- --------
Total current liabilities 4,344 3,333
Notes payable -- 2,205
Noncurrent portion of capital lease obligations, capital loans and long-term debt 3,926 4,933
Other long-term liabilities 1,184 1,262
Commitments
Stockholders' equity:
Preferred stock, $0.001 par value: 5,000,000 shares authorized; no shares
issued and outstanding at June 30, 1996 and 3,965,137 shares issued and
outstanding at December 31, 1995 -- 4
Common stock, $0.001 par value: 50,000,000 shares authorized; 7,382,904
shares issued and outstanding at June 30, 1996 and 908,511 shares issued
and outstanding at December 31, 1995 7 1
Additional paid in capital 46,128 21,425
Notes receivable from stockholders (107) (134)
Deferred compensation, net (1,709) (1,933)
Other (18) --
Deficit accumulated during the development stage (26,516) (19,300)
---------- --------
Total stockholders' equity 17,785 63
---------- --------
$ 27,239 $ 11,796
========== ========
See notes to condensed financial statements.
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CONNECTIVE THERAPEUTICS, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
(UNAUDITED)
PERIOD FROM
INCEPTION
THREE MONTHS ENDED SIX MONTHS ENDED (FEBRUARY 8,
JUNE 30, JUNE 30, 1993) TO
--------------------------- --------------------------- JUNE 30,
1996 1995 1996 1995 1996
---------- ---------- ---------- ---------- --------
Operating Expenses:
Research and development $ 2,865 $ 2,020 $ 5,009 $ 4,666 $ 20,552
General and administrative 1,020 347 2,319 650 5,989
---------- ---------- ---------- ---------- --------
Total operating expenses 3,885 2,367 7,328 5,316 26,541
Interest income 351 145 612 219 1,055
Interest expense (236) (85) (500) (169) (1,030)
---------- ---------- ---------- ---------- --------
Net loss $ (3,770) $ (2,307) $ (7,216) $ (5,266) $(26,516)
========== ========== ========== ========== ========
Net loss per share $ (0.51) $ (0.52) $ (1.19) $ (1.19)
========== ========== ========== ==========
Shares used to calculate net loss per share 7,380,048 4,434,075 6,085,462 4,433,436
========== ========== ========== ==========
See notes to condensed financial statements.
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CONNECTIVE THERAPEUTICS, INC.
(A DEVELOPMENT STAGE COMPANY)
CONDENSED STATEMENTS OF CASH FLOWS
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(IN THOUSANDS)
(UNAUDITED)
PERIOD FROM
INCEPTION
SIX MONTHS ENDED (FEBRUARY 8,
JUNE 30, 1993) TO
----------------------- JUNE 30,
1996 1995 1996
-------- -------- --------
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (7,216) $ (5,266) $(26,516)
Adjustments to reconcile net loss to net cash used by operating activities:
Depreciation and amortization 313 176 827
Technology acquired in exchange for notes payable and other
long-term liability -- 855 2,705
Amortization of deferred compensation 369 -- 701
Changes in assets and liabilities:
Current and other assets 563 (109) (593)
Current and other long-term liabilities (300) (184) 3,146
-------- -------- --------
Net cash used by operating activities (6,271) (4,528) (19,730)
-------- -------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of short-term investments (25,575) (9,000) (33,135)
Sales and maturities of short-term investments 10,565 6,300 18,125
Capital expenditures (302) (24) (1,378)
-------- -------- --------
Net cash used in investing activities (15,312) (2,724) (16,388)
-------- -------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Payment of bank loans -- (750) --
Payment of notes payable (2,205) -- (2,205)
Proceeds from capital loans and long-term debt 216 -- 5,986
Payments on obligations under capital leases and capital loans (190) (126) (621)
Proceeds from issuance of preferred and common stock,
net of issuance costs 24,560 12,763 42,779
-------- -------- --------
Net cash provided by financing activities 22,381 11,887 45,939
-------- -------- --------
Net increase in cash and cash equivalents 798 4,635 9,821
Cash and cash equivalents at beginning of period 9,023 1,287 --
-------- -------- --------
Cash and cash equivalents at end of period $ 9,821 $ 5,922 $ 9,821
======== ======== ========
SUPPLEMENTARY INFORMATION:
Interest paid $ 619 $ 151 $ 966
======== ======== ========
See notes to condensed financial statements.
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CONNECTIVE THERAPEUTICS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 1996
(UNAUDITED)
1. BASIS OF PRESENTATION
The accompanying unaudited condensed financial statements of Connective
Therapeutics, Inc. (the "Company" or "Connective") have been prepared in
accordance with generally accepted accounting principles for interim financial
information and pursuant to the instructions to Form 10-Q and Article 10 of
Regulation S-X. Accordingly, such financial statements do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements. In the opinion of management, all
adjustments, consisting of normal recurring accrual adjustments, considered
necessary for a fair presentation have been included. Operating results for the
three and six month periods ended June 30, 1996 are not necessarily indicative
of the results that may be expected for the year ending December 31, 1996.
These financial statements and notes should be read in conjunction with the
Company's audited financial statements and notes thereto for the year ended
December 31, 1995 included in the Company's Registration Statement on Form S-1
(Reg. No. 33-80261) and related prospectus for the Company's initial public
offering of its Common Stock, which was completed on February 6, 1996.
2. NET LOSS PER SHARE
Net loss per share is computed using the weighted average number of shares of
common stock outstanding. Common equivalent shares from stock options and
convertible preferred stock are excluded from the computation as their effect is
antidilutive, except that, pursuant to Securities and Exchange Commission Staff
Accounting Bulletins, common equivalent shares issued during the twelve-month
period prior to the initial public offering are presumed to have been issued in
contemplation of the public offering and have been included in the calculation
as if they were outstanding for all periods through December 31, 1995 (using the
treasury stock method for stock options and the anticipated public offering
price).
The supplemental calculation of net loss per share presented below has been
computed using the weighted average number of shares of common stock and
preferred stock outstanding.
THREE MONTH PERIOD SIX MONTH PERIOD
ENDED JUNE 30, ENDED JUNE 30,
1996 1995 1996 1995
---- ---- ---- ----
Supplemental net loss per share $ (0.51) $ (0.49) $ (1.05) $ (1.31)
========== ========== ========== ==========
Shares used in computation 7,380,048 4,691,784 6,878,489 4,021,524
========== ========== ========== ==========
3. LICENSE AGREEMENTS
In April 1996, the Company acquired exclusive rights to relaxin (ConXn(TM)) in
Japan, the Republic of Korea and the Republic of China from Mitsubishi Chemical
Corporation. Mitsubishi was the original licensee of relaxin in these Asian
territories under a previous agreement with Genentech, Inc. The completion of
this transaction provides the Company with worldwide rights to relaxin.
In June 1996, the Company entered into an exclusive License Agreement with
Soltec Research PTY Ltd. (the "Licensor"), to develop and market betamethasone
mousse (a foam mousse formulation of the dermatologic drug, betamethasone
valerate) in North America. Under the terms of the
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Agreement, the Company will pay a licensing fee to the Licensor, plus royalties
on sales of products, if any, arising from the licensed technology . The Company
also has an exclusive option on the Licensor's foam mousse system for the
delivery of other compounds.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The following discussion contains certain forward looking statements which
involve risks and uncertainties. The Company's actual results could differ
materially from the results anticipated in these forward looking statements as a
result of certain factors set forth under the heading "Risk Factors" in the
Company's Registration Statement on Form S-1 (Reg. No. 33-80261) dated January
31, 1996 relating to the Company's initial public offering and under the heading
"Additional Factors that May Affect Future Results" in the Company's Report on
Form 10-Q for the quarter ended March 31, 1996.
The following discussion should be read in conjunction with the unaudited
condensed financial statements and notes thereto included in Part I, Item 1 of
this Quarterly Report and with Management's Discussion and Analysis of Financial
Condition and Results of Operations contained in the Company's Prospectus and
Registration Statement on Form S-1 (Reg. No. 33-80261) dated January 31, 1996
relating to the Company's initial public offering.
OVERVIEW
Connective is focused on the development of therapeutics to address serious
diseases involving the connective tissues of the body.
The Company's products under development include gamma interferon for the
treatment of atopic dermatitis and keloids; betamethasone mousse for the
treatment of scalp psoriasis and other scalp dermatoses; ConXn(TM) (relaxin) for
the treatment of scleroderma and other fibrotic disorders and TCR vaccines for
the treatment of multiple sclerosis and rheumatoid arthritis. At present, all
products are under development and no revenues have been derived from the sale
of products.
In June 1996, the Company held an end-of-Phase II meeting with the FDA and
discussed the design of a Phase III protocol for evaluating gamma interferon for
the treatment of atopic dermatitis. An Investigational New Drug application was
subsequently submitted to the agency and the Company expects to begin the Phase
III trial upon final clearance.
Also in June 1996, the Company signed an agreement with Soltec Research PTY Ltd.
which granted Connective an exclusive license to develop and market
betamethasone mousse (a foam mousse formulation of the dermatologic drug,
betamethasone valerate) in North America. The product has been approved in the
United Kingdom and is being marketed by Evans Medical Ltd. Using Phase III
clinical data from European trials, Connective expects to conduct activities
necessary to register betamethasone mousse in scalp psoriasis and to submit a
New Drug Application for marketing the product in the United States.
As planned, in June 1996, the Company initiated a Phase II clinical trial of
ConXn(TM) (recombinant human relaxin H2) for the treatment of scleroderma, a
serious, life threatening connective tissue disorder. This multicenter,
double-blind, placebo-controlled trial is expected to enroll 60 scleroderma
patients. The primary objectives of the study are to evaluate the safety of
administration of the product over 24 weeks, to confirm efficacy and to
determine endpoints to be used in subsequent pivotal clinical studies. In
addition, a separate, open-label extended study of ConXn(TM) in 11 scleroderma
patients was initiated earlier this year. Enrollment is complete and preliminary
safety and efficacy data from long-term (24 weeks) administration of the drug is
expected to be available by year end.
Connective gained worldwide rights to ConXn(TM) with the addition of exclusive
rights to the product in Japan, the Republic of Korea and the Republic of China
from Mitsubishi Chemical Corporation in April 1996. Mitsubishi was the original
licensee of relaxin in these Asian territories under a previous agreement with
Genentech, Inc., from whom Connective has licensed relaxin rights throughout the
rest of the world.
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In June 1996, results from a Phase I/II clinical trial of TCR vaccines for
multiple sclerosis were presented by Connective collaborator, Arthur A.
Vandenbark, Ph.D. of Neuroimmunology Research, Veterans Affairs Medical Center,
Portland and Oregon Health Sciences Center. Data from the physician sponsored
trial indicated more frequent and stronger regulatory T-cell responses in
multiple sclerosis patients who received TCR vaccines compared to placebo. In
addition, patients who responded immunologically to the vaccines experienced
clinical benefit as assessed by neurologists. The Company plans to confirm these
data in a company sponsored trial which is expected to be initiated by year end
1996.
There can be no assurance that any of the Company's potential products will be
successfully developed, receive the necessary regulatory approvals or be
successfully commercialized.
The Company has financed its operations primarily through the private sale and
issuance of equity securities. Additional cash has been received in connection
with certain credit financing arrangements. To date, substantially all of the
Company's expenditures have been for research and development activities. The
Company has incurred operating losses since its inception and had an accumulated
deficit of $26.5 million at June 30, 1996. The Company will require additional
funds to complete the development of its products and to fund operating losses
which are expected in the next several years. The Company does not expect its
products to be commercialized for the next several years.
RESULTS OF OPERATIONS
Research and development expenses increased to $2.9 million and $5.0 million for
the three and six months ended June 30, 1996, respectively, compared to $2.0
million and $4.7 million for comparable periods in 1995, respectively. This
increase was due primarily to increases in personnel staffing, the expansion of
clinical trials, the production of clinical supplies and increased outside
services required to support operations in 1996. Research and development
expenses are expected to continue to increase due to continued expansion of
development activities, including progression of clinical trials and possible
acquisition of new products and technologies.
General and administrative expenses increased to $1.0 million and $2.3 million
for the three and six months ended June 30, 1996, respectively, compared to $0.3
million and $0.7 million for comparable periods in 1995, respectively. This
increase is due primarily to increased support costs associated with operating
as a public company, including costs related to strengthening the senior
management team. The Company expects to continue to incur general and
administrative costs at approximately the current level over the near term.
Interest income increased to $0.4 million and $0.6 million for the three and six
months ended June 30, 1996, respectively, compared to $0.1 million and $0.2
million for comparable periods in 1995, respectively. This increase in interest
income is due to higher average cash and investment balances held by the Company
during the first two quarters of 1996 than during the comparable periods in
1995. Interest earned in the future will depend on Company funding cycles and
prevailing interest rates. Interest expense increased to $0.2 million and $0.5
million for the three and six months ended June 30, 1996, respectively, compared
to $0.1 million and $0.2 million for comparable periods in 1995, respectively.
This increase in interest expense is due to higher balances outstanding for
obligations under capital leases and loans, and notes payable.
The Company incurred net losses of $3.8 million and $7.2 million for the three
and six months ended June 30, 1996, respectively, compared to $2.3 million and
$5.3 million for comparable periods in 1995, respectively. The Company expects
to incur substantial additional losses over the next several years. The losses
are expected to fluctuate from period to period based on timing of raw material
purchases, manufacturing scale-up activities and clinical activities.
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LIQUIDITY AND CAPITAL RESOURCES
The Company has financed its operations since inception through June 30, 1996
primarily through private sale and issuance of equity securities and from the
proceeds of its initial public offering in February 1996.
Working capital increased to $20.7 million at June 30, 1996, compared to working
capital of $5.8 million at December 31, 1995, due to the receipt of
approximately $25.6 million in net proceeds from the initial public offering,
offset by cash used in operations of approximately $6.3 million for the six
months ended June 30, 1996 and the repayment of $2.2 million in notes
outstanding pursuant to certain technology licensing agreements. At June 30,
1996, the Company had cash, cash equivalents and short-term investments totaling
$24.8 million, compared to $9.0 million at December 31, 1995. It is generally
the Company's policy to invest these funds in highly liquid securities, such as
interest-bearing money market funds, corporate debt, commercial paper and
federal agency notes.
For the six months ended June 30, 1996, additions of equipment and leasehold
improvements totaled $0.5 million of which approximately $0.4 million was
financed through capital lease and loan arrangements. Total additions for
equipment and leasehold improvements for the period from inception to December
31, 1995, totaled $1.9 million of which $1.6 million was financed through
capital lease and loan arrangements. At June 30, 1996, the Company had invested
$2.4 million in property and equipment, and had approximately $1.2 million
available for borrowing under its capital loan arrangement.
The Company believes that proceeds from its initial public offering in February
1996, together with available cash and cash equivalents, short-term investments
and amounts available under a capital loan agreement, will be sufficient to meet
the Company's operating expenses and capital requirements into 1997. The Company
expects to incur substantial additional development costs, including costs
related to clinical trials and manufacturing expenses. As a result, the Company
will require substantial additional funds prior to reaching profitability and
may attempt to raise additional funds through equity or debt financings,
collaborative arrangements with corporate partners or from other sources. There
can be no assurance that additional funds will be available for the Company to
finance its ongoing operations on acceptable terms, if at all.
The Company's future capital uses and requirements are expected to increase in
future periods and will depend on numerous factors, including the progress of
its research and development programs, the progress of pre clinical and clinical
testing, the time and costs involved in obtaining regulatory approvals, the cost
of filing, prosecuting, and enforcing patent claims and other intellectual
property rights, competing technological and market developments, the ability of
the Company to establish collaborative arrangements, the acquisitions of new
products and technologies, and the development of commercialization activities.
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PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 2. CHANGES IN SECURITIES
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
Number Exhibit Table
3.1* Restated Certificate of Incorporation of Registrant
and Certificate of Amendment thereto
3.2* Bylaws of Registrant
3.3* Form of Amended and Restated Certificate of
Incorporation filed with the Delaware Secretary of
State to effect the Company's one-for-4.4477
reverse stock split
3.4* Form of Amended and Restated Certificate of
Incorporation filed with the Delaware Secretary of
State upon the closing of the Company's initial
public offering
3.5* Form of Bylaws effective upon the closing of the
Company's initial public offering
4.1* Form of Common Stock Certificate
10.1* Form of Indemnification Agreement
10.2* 1994 Stock Plan and form of Option Agreement and
Stock Purchase Agreement
10.3* 1995 Employee Stock Purchase Plan and form of
Subscription Agreement
10.4* 1995 Directors' Stock Option Plan and form of
Option Agreement
10.5* Third Amended and Restated Registration Rights
Agreement dated February 14, 1995 among the
Registrant and certain security holders of the
Registrant and Amendments Nos. 1 and 2 thereto
dated May 31, 1995 and September 28, 1995
10.6+* License Agreement dated September 27, 1993, between
Genentech, Inc. and the Company, Amendment dated
July 14, 1994, and side letter agreement dated
November 17, 1994
10.7+* Subordinated Promissory Note, dated June 3, 1994,
payable to XOMA Corporation
10.8* Assignment and Assumption Agreement, dated June 3,
1994, by and between the Company and XOMA
Corporation
10.9+* Technical Collaboration and Manufacturing
Agreement, dated May 24, 1994, by and between the
Company and Scios Nova Inc.
10.10+* Technology Acquisition Agreement dated June 3, 1994
by and between the Company and XOMA Corporation,
and License Agreement dated February 27, 1990 by
and between Arthur A. Vandenbark, Ph.D. and XOMA
Corporation
10.11+* Agreement on Interferon Gamma-1B dated December 8,
1995 by and between the Company and Genentech, Inc.
10.12+* Equipment Lease Line, dated May 31, 1994 with Lease
Management Services, Inc.
10.13+* Business Loan Agreement, dated July 19, 1995,
between the Company, Silicon Valley Bank and
MMC/GATX Partnership No. 1
10.14+* Research Collaboration and Assignment Agreement,
dated July 1, 1994, between the Company and Dr.
Arthur A. Vandenbark
10.15* Employment and Bonus Agreement between the Company
and Edward Amento, dated
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November 17, 1993
10.16* Secured Loan Agreements between the Company and
Edward Amento dated November 1, 1993 and July 11,
1994, respectively
10.17* Consulting Agreement dated November 17, 1993
between the Company and Brian Seed
10.18* Consulting Agreement dated November 17, 1993
between the Company and Eugene Bauer
10.19* Employment Agreement dated June 9, 1994 between the
Company and Thomas Wiggans
10.20* Loan Agreements between the Company and Thomas
Wiggans dated July 15, 1994 and August 1, 1994
10.21* Letter Agreement with G. Kirk Raab dated October 1,
1995
10.22* Sublease Agreement with Systemix dated December 6,
1993
10.23* Facility Master Lease between the Company and
Renault & Handley dated February 9, 1994
10.24* Master Bridge Loan Agreement between the Company
and certain investors dated December 7, 1995
10.25* Agreement with William Albright dated November 17,
1995
10.26* Loan and Security Agreement dated December 21, 1995
by and among the Company, Silicon Valley Bank and
MMC/GATX Partnership No. 1
10.27++ Agreement on Relaxin Rights in Asia dated April 1,
1996 between the Company and Mitsubishi Chemical
Corporation
10.28++ Soltec License Agreement dated June 14, 1996
27.1 Financial Data Schedule
-----------------
* Incorporated by reference to exhibit of the same
number in the Company's Registration Statement on
Form S-1 and Amendments No. 1, 2, 3, and 4 thereto
(Registration No. 33-80261) which became effective
on January 31, 1996.
+ Confidential treatment has been granted as to
certain portions of this Exhibit by the Securities
and Exchange Commission.
++ Confidential treatment has been requested as to
certain portions of this Exhibit
(b) Reports on Form 8-K.
None.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this Report to be signed on its behalf by the
undersigned, thereunto duly authorized.
CONNECTIVE THERAPEUTICS, INC.
By: /s/ CYNTHIA M. BUTITTA
--------------------------------
Cynthia M. Butitta
Vice President, Finance and Administration
and Chief Financial Officer
Date: July 18, 1996
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