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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): August 2, 1995
ONCOGENE SCIENCE, INC.
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(Exact Name of Registrant as Specified in Charter)
Delaware 0-15190 13-3159796
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(State or Other Jurisdiction (Commission File Number) (I.R.S. Employer
of Incorporation) Identification No.)
106 Charles Lindbergh Blvd., Uniondale, NY 11553
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (516) 222-0023
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ITEM 2. DISPOSITION OF ASSETS
On August 2, 1995, pursuant to an Asset Purchase Agreement dated June
26, 1995, Oncogene Science, Inc. (the "Company") closed the sale of its
Research Products business to Calbiochem-Novabiochem Corporation (the "Buyer"),
a wholly owned subsidiary of Calbiochem-Novabiochem International, Inc., for $6
million in cash and certain other consideration. The Company retained the
trade accounts receivable of the Research Products business, net of the trade
accounts payable and accrued expenses thereof. The Company did not sell any
rights with respect to its diagnostics business, and it retained the right to
sell research products in the clinical research market. Pursuant to an
agreement entered into on the closing date, the sale was given effect as of
11:59 p.m. Eastern Daylight Time on July 31, 1995.
Pursuant to this transaction, the Buyer subleased a portion of the
Company's leased facilities located in Cambridge, Massachusetts, and the Buyer
will make certain rent payments under this sublease. The rent payable by the
Buyer is intended to reimburse the Company for the Buyer's use of the subleased
premises, and does not include an element of profit or mark-up relative to the
Company's obligations under its lease.
The Buyer will have the right through July 31, 2000 to license from
the Company the rights to make, use and sell new research products developed by
the Company in its cancer diagnostics business. The Buyer will make certain
royalty payments to the Company with respect to sales of research products so
licensed, if any.
In connection with the sale of the Research Products business, the
Company retained Cowen & Company ("Cowen") to assist it in locating a buyer.
Cowen prepared a confidential Information Memorandum regarding the Research
Products business and delivered it to various entities that Cowen expected
might have an interest in the Research Products business. Certain of these
entities responded to Cowen's inquiries and entered into discussions and
negotiations with the Company. The purchase price was determined pursuant to
negotiations between the Company and the Buyer based largely on the sales
volume of the Research Products business.
The assets sold by the Company in this transaction included:
1. various contracts related to the Company's Research
Products business, including license agreements, distributorship
agreements, equipment leases, purchase orders, sales orders and other
contracts;
2. cell lines, sibling cell lines, strains, cultures and
other biological or biochemical source stocks used the by the Company
in the Research Products business;
3. equipment and machinery related to the Research
Products business;
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4. intangible personal property rights relating
exclusively to the Research Products business, including, among other
things, goodwill, software and software systems, etc.;
5. certain intellectual property, including trademarks
associated with various research products, know-how relating to the
manufacture and development of research products, copyrights and
certain patent rights; and
6. inventory, prepaid expenses and other assets.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) PRO FORMA FINANCIAL INFORMATION.
SELECTED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION
(UNAUDITED)
The following unaudited pro forma consolidated financial statements give effect
to the sale on August 2, 1995 of certain assets comprising the Company's
Research Products business to Calbiochem-Novabiochem Corporation, a wholly
owned subsidiary of Calbiochem-Novabiochem International, Inc., for $6 million
in cash and certain other consideration.
The pro forma consolidated statements of operations for the year ended
September 30, 1994 and the nine months ended June 30, 1995 assume the sale was
consummated as of October 1, 1993 and October 1, 1994, respectively. The pro
forma consolidated balance sheet assumes that such sale was consummated as of
June 30, 1995.
The pro forma consolidated financial statements do not purport to represent the
Company's actual financial condition or results of operations had such sale
actually been made on the dates indicated, nor do they project the Company's
financial position or results of operations for any future dates or periods.
The pro forma consolidated financial statements should be read in conjunction
with the notes thereto and historical financial statements of the Company as of
and for the periods ended September 30, 1994 and June 30, 1995.
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PRO FORMA CONSOLIDATED BALANCE SHEET
(UNAUDITED)
JUNE 30, 1995
LESS
ONCOGENE RESEARCH PRO FORMA
SCIENCE, INC. PRODUCTS ADJUSTMENTS PRO FORMA
------------- -------- ----------- ---------
ASSETS
Cash and cash equivalents $ 1,752,700 $ -- $ -- $ 1,752,700
Short term investments 19,124,900 -- 6,000,000 25,124,900
Accounts receivable, net 1,731,800 -- -- 1,731,800
Grants receivable 204,150 -- -- 204,150
Accrued interest receivable 164,843 -- -- 164,843
Inventory 1,619,824 1,619,824 -- --
Prepaid expenses 566,558 135,444 -- 431,114
--------- ---------- ------------- ------------
Total current assets 25,164,775 1,755,268 6,000,000 29,409,507
Fixed assets, net 6,186,101 200,720 -- 5,985,381
Other receivables 573,180 -- -- 573,180
Loans to officers & employees 75,466 -- -- 75,466
Other assets 109,036 -- -- 109,036
Intangible assets 9,360,598 367,128 -- 8,993,471
--------- --------- ------------- -----------
$41,469,156 $2,323,116 $6,000,000 $45,146,040
========== ========= ========= ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable and accrued
expenses $1,333,464 $-- $850,000 $2,183,464
Unearned revenue 370,042 -- -- 370,042
---------- ----------- ------------ -----------
Total current liabilities 1,703,506 2,553,506
Long term portion of unearned
revenue 180,158 -- -- 180,158
Post-retirement benefits
other than pension 292,509 -- -- 292,509
------- ------------ ------------ -------
Total liabilities 2,176,173 -- 850,000 3,026,173
Stockholders' Equity:
Common stock, $.01 par value 174,797 -- -- 174,797
Additional paid in capital 66,203,427 -- -- 66,203,427
Retained earnings (deficit) (26,663,415) 2,323,116 -- (23,836,531)
Unrealized holding loss (193,000) -- -- (193,000)
Cumulative translation adjust. (86,267) -- -- (86,267)
------------ ------------ ------------ --------------
39,435,542 2,323,110 5,150,000 42,262,426
Less: treasury stock (142,559) -- -- (142,559)
Total stockholders' equity 39,292,983 2,323,116 5,150,000 42,119,867
Total liabilities & equity $41,469,156 $2,323,116 $6,000,000 $45,146,040
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NOTE TO PRO FORMA CONSOLIDATED BALANCE SHEET
(UNAUDITED)
The foregoing pro forma adjustments assume the sale of the Research
Products business was consummated as of June 30, 1995. The Asset Purchase
Agreement included all tangible and intangible assets of the Research Products
business, except for trade accounts receivable (approximately $894,000 at June
30, 1995), net of trade accounts payable and accrued expenses (approximately
$128,000 at June 30, 1995).
Costs incurred in connection with the sale of the Research Products
business, consisting of professional fees, employee severance and other costs
related to the sale estimated at $850,000, have been reflected as accrued
expenses in the accompanying pro forma consolidated balance sheet.
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PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
YEAR ENDED SEPTEMBER 30, 1994
LESS
ONCOGENE RESEARCH PRO FORMA
SCIENCE, INC. PRODUCTS ADJUSTMENTS PRO FORMA
------------- -------- ----------- ---------
Collaborative program
revenues $9,089,295 $ -- $ -- $9,089,295
Sales 4,937,917 4,937,917 -- --
Other research revenue 2,272,277 -- -- 2,272,277
----------- ---------- ------------ -----------
16,299,489 4,937,917 -- 11,361,572
----------- ---------- ------------ -----------
Research & development 12,125,210 231,399 -- 11,893,811
Production 1,427,981 1,427,981 -- -0-
Selling, general &
administrative 7,487,090 3,175,476 -- 4,311,614
Amortization of intangibles 1,745,163 293,540 -- 1,451,623
----------- ---------- ------------ -----------
22,785,444 5,128,396 -- 17,657,048
----------- ---------- ------------ -----------
Loss from operations (6,485,955) (190,479) -- (6,295,476)
Interest income 858,904 206,000 1,064,904
Other income (expenses) (96,873) 26,649 -- (123,522)
----------- --------- ------------ -----------
Net income (loss) $(5,723,924) $(163,830) $206,000 $(5,354,094)
=========== ========= ======= ===========
Weighted average number
of shares of common
stock outstanding 16,335,000 16,335,000
Net loss per weighted
share of common
stock outstanding $(0.35) $(0.33)
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PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
NINE MONTHS ENDED JUNE 30, 1995
LESS
ONCOGENE RESEARCH PRO FORMA
SCIENCE, INC. PRODUCTS ADJUSTMENTS PRO FORMA
------------- -------- ----------- ---------
Collaborative program revenues $7,102,909 $ -- $ -- $7,102,909
Sales 3,849,229 3,849,229 -- --
Other research revenue 1,359,076 -- -- 1,359,076
----------- ---------- ----------
12,311,214 3,849,229 -- 8,461,985
----------- ---------- ---------- ----------
Research & development 9,812,630 178,814 -- 9,633,816
Production 1,179,674 1,179,674 -- --
Selling, general &
administrative 5,472,808 2,112,338 -- 3,360,470
Amortization of intangibles 1,309,261 220,155 -- 1,089,106
----------- ---------- ---------- -----------
17,774,373 3,690,981 -- 14,083,392
----------- ---------- ---------- -----------
Income (loss) from
operations (5,463,159) 158,248 -- (5,621,407)
Interest income 695,564 -- 193,125 888,689
Other income (expenses) (25,149) 27,113 -- (52,262)
----------- ---------- ---------- -----------
Net income (loss) $ (4,792,744) $185,361 $193,125 $ (4,784,980)
=========== ======= ======= ===========
Weighted average number of
shares of common stock
outstanding 16,560,456 16,560,456
Net loss per weighted share
of of common stock
outstanding $(0.29) $(0.29)
========= =========
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NOTE TO PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
The following proforma adjustments to the consolidated statements of
operations for the year ended September 30, 1994 and the nine months ended June
30, 1995 assume the sale of the Research Products business was consummated as
of October 1, 1993 and October 1, 1994, respectively.
Nine Months
Year Ended Ended
September 30, 1994 June 30, 1995
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Increase in interest income to
reflect the investment of the
net proceeds of $5.15
million based on the effective
rates of return on the
Company's short-term
investments (4% for the
year ended September 30, 1994
and 5% for the nine months
ended June 30, 1995) $206,000 $193,125
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ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS (CONTINUED)
(b) EXHIBITS.
10.1 Asset Purchase Agreement dated June
26, 1995 among Oncogene Science,
Inc., Calbiochem- Novabiochem
International, Inc. and
Calbiochem-Novabiochem Corporation.
10.2 Sublease dated August 2, 1995
between Oncogene Science, Inc.and
Calbiochem-Novabiochem Corporation.
10.3 New Product License Right of First
Refusal Agreement dated August 2,
1995 between Oncogene Science, Inc.
and Calbiochem-Novabiochem
Corporation.
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SIGNATURES
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 hereunto duly authorized.
ONCOGENE SCIENCE, INC.
By: /s/ Robert L. Van Nostrand
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Robert L. Van Nostrand,
Vice President, Finance and Administration
Dated: August 17, 1995
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EXHIBIT INDEX
Exhibit No. Description Page
10.1 Asset Purchase Agreement dated June 26, 1995
among Oncogene Science, Inc.,
Calbiochem-Novabiochem International, Inc. and
Calbiochem-Novabiochem Corporation
10.2 Sublease dated August 2, 1995 among Oncogene
Science, Inc. and Calbiochem-Novabiochem
Corporation
10.3 New Product License Right of First Refusal
Agreement dated August 2, 1995 between Oncogene
Science, Inc. and Calbiochem-Novabiochem
Corporation