FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1996
-------------------------------------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _________________________ to _______________
Commission file number 0-19059
Deprenyl Animal Health, Inc.
(Exact name of registrant as specified in its charter)
Missouri 36-3716293
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
10955 Lowell, Suite 710
Overland Park, Kansas 66210
(address of principal executive offices)
(Zip Code)
(913) 338-2120
(Registrant's telephone number, including area code)
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 the past 90 days.
Yes x No
--------- ----------
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 subsequent to the distribution of securities under a plan confirmed
by a court.
Yes No
----- -----
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
7,510,998 common shares as of May 8, 1996
PART I. - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
DEPRENYL ANIMAL HEALTH, INC.
(A DEVELOPMENT STAGE COMPANY)
Balance Sheets
(Stated in U.S. Dollars)
- - -------------------------------------------------------------------------------
March 31, December 31,
ASSETS Note 1996 1995
------ ------- -------------- -------------
Current Assets:
Cash and cash equivalents (2) $ 2,072,586 $ 1,054,759
Receivables:
Draxis Health Inc. 23,028 431
Prepaid expenses 735 1,832
Inventory (3) 123,645 --
----------- ----------
Total Current Assets 2,219,994 1,057,022
Furniture, equipment and leasehold
improvements, net of accumulated
depreciation and amortization 66,743 55,575
Other Assets:
Intangibles (4) 463,106 442,877
Other 3,418 4,618
----------- ----------
Total Assets $2,753,261 $1,560,092
----------- ----------
----------- ----------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued expenses $ 92,803 $ 135,963
----------- ----------
Total Current Liabilities 92,803 135,963
Notes Payable - Draxis Health Inc. (5) 2,545,000 3,090,000
----------- ----------
Total Liabilities 2,637,803 3,225,963
Commitments
Stockholders' Equity:
Common stock, no par, 20,000,000 shares
authorized, 7,502,674 shares issued and
outstanding, as of March 31, 1996 and
20,000,000 shares authorized, 6,508,675 10,144,338 8,599,338
shares issued and outstanding, as of
December 31, 1995.
Deficit accumulated during development stage (10,028,880) (10,265,209)
----------- ----------
Total Stockholders' Equity (Deficit) 115,458 (1,665,871)
----------- -----------
----------- -----------
Total Liabilities and Stockholders' Equity $2,753,261 $1,560,092
----------- ----------
----------- ----------
The accompanying notes are an integral part of these balance sheets.
DEPRENYL ANIMAL HEALTH, INC.
(A DEVELOPMENT STAGE COMPANY)
Statements of Operations
(Stated in U.S. Dollars)
- - -------------------------------------------------------------------------------
Period From
July 19, 1990 (Date
Period Ended March 31, of Incorporation) to
---------------------------------- March 31,
1996 1995 1996
----------- --------- --------------------
REVENUE:
Sales $23,028 $ -- $23,028
Interest and investment income 23,434 30,086 1,093,681
Gain on foreign currency exchange -- 65 15,454
Realized gain on investment securities -- -- 71,214
Distribution rights (Note 5) 468,750 -- 468,750
Other 300,000 25,000 501,929
--------- --------- ----------
815,212 55,151 2,174,056
-------- -------- ---------
EXPENSES:
Research and development 269,407 420,072 5,910,232
General and administrative 253,473 179,260 5,430,514
Interest 44,014 77,007 572,536
Depreciation and amortization 11,989 12,834 289,654
--------- --------- ----------
578,883 689,173 12,202,936
--------- --------- ----------
NET INCOME (LOSS) (Note 6) $236,329 $(634,022) $(10,028,880)
--------- --------- ----------
--------- --------- ----------
NET INCOME (LOSS) PER COMMON SHARE $0.03 ($0.10) ($1.61)
--------- --------- ----------
--------- --------- ----------
WEIGHTED AVERAGE NUMBER
OF COMMON SHARES 7,376,320 6,483,675 6,211,957
--------- --------- ----------
--------- --------- ----------
The accompanying notes are an integral part of these statements.
DEPRENYL ANIMAL HEALTH, INC.
(A DEVELOPMENT STAGE COMPANY)
Statements of Cash Flows
(Stated in U.S. Dollars)
_______________________________________________________________________________
Period From
Period Ended March 31, July 19, 1990
(Date of Incorporation)
------------------------------------------------- to March 31,
1996 1995 1996
------------------------ ------------------------ -----------------------
OPERATING ACTIVITIES:
Net income (loss) $236,329 $(634,022) $(10,028,880)
Adjustments to reconcile
net income (loss) to cash used
in operating activities:
Depreciation and
amortization 11,989 19,075 289,654
Amortization of unearned supply
agreement consideration -- -- 653,500
Amortization of premium on
investment securities -- -- 52,533
Realized gain on
investment securities (gross) -- -- (71,214)
Compensation expense
resulting from stock
issued at price below
estimated market value -- -- 423,746
Amortization of unearned
compensation resulting
from stock option grants -- -- 620,140
Benefit resulting from
increase in exercise
price of stock options -- -- (16,640)
Gain on foreign
currency exchange -- (65) (15,454)
Changes in operating
accounts:
Receivable from Draxis
Health Inc. (22,597) (263) (23,028)
Prepaid expenses 1,097 1,246 (735)
Inventory (123,645) -- (123,645)
Accrued interest
receivable -- 5,506 --
Other assets 1,200 -- (3,418)
Accounts payable and
accrued expenses (43,160) 113,384 97,942
--------- --------- ---------
Net cash provided by (used in)
operating activities 61,213 (495,139) (8,145,499)
--------- --------- ---------
--------- --------- ---------
INVESTING ACTIVITIES:
Purchases of furniture,
equipment and leasehold
improvements (16,915) (676) (143,187)
Purchases of investment
securities -- -- (20,054,735)
Proceeds from sales of
investment securities -- 976,292 19,898,024
Expenditures for intangible
assets (26,471) (20,596) (494,398)
Investment in Phoenix
Scientific, Inc. -- -- 175,390
--------- --------- ---------
Net cash provided by (used in)
investing activities (43,386) 955,020 (618,906)
--------- --------- ---------
--------- --------- ---------
DEPRENYL ANIMAL HEALTH, INC.
(A DEVELOPMENT STAGE COMPANY)
Statements of Cash Flows
(Stated in U.S. Dollars)
Period From
July 19, 1990
(Date of Incorporation)
Period Ended March 31, to March 31,
--------------------------------
1996 1995 1996
--------------- -------------- ---------------------
FINANCING ACTIVITIES:
1994 Loan from Draxis Health Inc. (955,000) $ -- $ 1,545,000
1996 Loan from Draxis Health Inc. 1,000,000 -- 1,000,000
Debt issuance costs -- -- (142,158)
Deferred stock offering
costs -- -- (1,458,227)
Advances from Draxis
Animal Health (Canada) Inc. (140,000) -- 139,724
Advances from Draxis Health Inc. (450,000) -- --
Repayments of advances from
Draxis Animal Health (Canada) Inc. -- -- (10,000)
Issuance of common stock 1,545,000 -- 9,747,198
------------ ----------- ------------
Net cash provided by
financing activities 1,000,000 -- 10,215,537
------------ ----------- ------------
EFFECT OF EXCHANGE RATES
ON CASH -- 65 15,454
------------ ----------- ------------
INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS 1,017,827 459,946 2,072,586
CASH AND CASH EQUIVALENTS:
Beginning of period 1,054,759 240,902 --
------------ ----------- ------------
End of period $ 2,072,586 $ 700,848 $ 2,072,586
------------ ----------- ------------
------------ ----------- ------------
SUPPLEMENTAL SCHEDULE OF
CASH FLOW INFORMATION:
Issuance of common stock for
intangibles acquired and
other noncash consideration $ -- $ -- $ 267,958
------------ ----------- ------------
------------ ----------- ------------
Reduction of amounts payable
in exchange for equipment $ -- $ -- $ 5,139
------------ ----------- ------------
------------ ----------- ------------
Deferred stock offering costs
offset against common stock $ -- $ -- $ 1,551,564
------------ ----------- ------------
------------ ----------- ------------
Investment in Phoenix
Scientific, Inc. financed by
obligations under contract $ -- $ (200,000) $ --
------------ ----------- ------------
------------ ----------- ------------
Interest paid $ 44,014 $ 70,766 $ 348,363
------------ ----------- ------------
------------ ----------- ------------
There have been no income taxes
paid.
The accompanying notes are an integral part of these statements.
DEPRENYL ANIMAL HEALTH, INC.
(A DEVELOPMENT STAGE COMPANY)
Notes to Financial Statements
(Unaudited)
1. The Balance Sheets as of March 31, 1996, the Statements of Operations for
the three months ended March 31, 1996 and 1995, and for the period from
July 19, 1990 (date of incorporation) to March 31, 1996, and the Statements
of Cash Flows for the three months ended March 31, 1996 and 1995 and for
the period from July 19, 1990 (date of incorporation) to March 31, 1996
have been prepared by the Company, without audit. In the opinion of
management, all adjustments (which include only normal recurring
adjustments) necessary to present fairly the financial position, results of
operations and changes in cash flows as of and for all periods presented
have been made. Certain amounts included in the 1995 presentation have
been reclassified to conform with the 1996 presentation.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted. These financial statements
should be read in conjunction with the Company's December 31, 1995
financial statements and notes thereto.
2. As of March 31, 1996, cash and cash equivalents consists of $2,019,173 in
interest bearing deposits and $53,413 in non-interest bearing deposits.
3. Inventories are priced at the lower of first in - first out (FIFO) cost.
As of March 31, 1996, inventories consist of $90,000 in raw materials and
$33,645 in finished goods.
4. As of March 31, 1996, intangible assets include the unamortized balance of
debt issuance costs totaling $110,951 and costs associated with securing
patents of $352,155.
5. Pursuant to terms of the Draxis Health Inc. (formerly Deprenyl Research
Limited) financing, the Company has notes payable to Draxis Health Inc.
aggregating $2,545,000. In January, 1996, the Company completed an
agreement with Draxis Health Inc. to distribute Anipryl-Registered
Trademark- in Canada. As part of the 10-year exclusive distribution
agreement, Draxis Health Inc. paid an up front fee of $468,750 for
specified Canadian rights to Anipryl-Registered Trademark- as well as
$125,000 for reimbursement of expenses incurred to date to prepare
marketing materials for the Canadian launch of Anipryl-Registered
Trademark-. The companies entered into a revenue sharing formula for
Canadian sales of Anipryl-Registered Trademark-. As part of the
distribution agreement, Draxis Health Inc. converted approximately $1.5
million of the $3 million in loans outstanding into common shares of the
Company. Draxis Health Inc. also provided $1 million of operating capital
in the form of a loan convertible to common shares of the Company. (See
Management's Discussion and Analysis for a detailed description of this
transaction.)
6. Net income (loss) per common share is based on the weighted average number
of shares outstanding during each period.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with the Company's
Financial Statements and Notes to Financial Statements for the year ended
December 31, 1995, as well as Management's Discussion and Analysis in the
Company's Form 10-K.
The Company was formed on July 19, 1990 to assume the rights and continue the
development and marketing research regarding the use of l-deprenyl
(Anipryl-Registered Trademark-) in animals previously performed by Deprenyl
Animal Health (Canada) Inc. ("DAH (Canada)"), a wholly-owned subsidiary of
Draxis Health Inc. Draxis Pharmaceutica Inc. (also a wholly-owned subsidiary of
Draxis Health Inc.) currently holds approximately a 44% equity interest
(formerly held by DAH (Canada)). Draxis Health Inc. ("Draxis"), formerly
Deprenyl Research Limited or DRL, holds convertible debt that could increase its
ownership to approximately 52% of the Company.
FINANCIAL CONDITION
Total assets increased during the period from $1,560,092 as of December 31, 1995
to $2,753,261 as of March 31, 1996, due primarily to financing received in
accordance with the Draxis Distribution Agreement (see discussion below). Also
during the quarter, the Company made its first sale of its product to Draxis and
has begun to build inventory levels.
Intangible assets increased from $442,877 as of December 31, 1995 to $463,106 as
of March 31, 1996 primarily due to the Company's program to obtain worldwide
patent and trademark coverage for Anipryl-Registered Trademark-. Amortization
of debt issuance costs associated with the 1994 and 1996 Draxis Financings, as
defined below, also continue to reduce amounts recorded as intangible assets.
The Company believes it has sufficient operating capital through the end of
1996. Management is actively seeking additional financing. Should such
additional financing not be attained in a timely manner, the Company could be
forced to curtail the clinical development of Anipryl-Registered Trademark- and
immediately reduce operations. See discussion of regulatory approval below
under "Results of Operations". See "Liquidity and Capital Resources".
RESULTS OF OPERATIONS
On October 2, 1995, the Company received regulatory approval by the Canadian
Health Protection Branch Bureau of Veterinary Drugs ("HPB") to market
Anipryl-Registered Trademark- in Canada. The Company had its first veterinary
pharmaceutical product sale for this indication in March, 1996. Management
believes that revenues from the marketing of Anipryl-Registered Trademark- in
Canada should marginally reduce operating losses for 1996.
In January, 1996, in order to obtain working capital through 1996 and to enhance
its capability to market its first approved product in Canada, the Company
signed an agreement with Draxis providing Draxis a ten-year exclusive
distribution right in Canada for Anipryl-Registered Trademark- (the "Draxis
Distribution Agreement").
The Company is awaiting action of the U.S. Food and Drug Administration with
regard to its Cushing's disease application. The Company is continuing its U.S.
pivotal clinical trial for canine cognitive dysfunction, at the current time,
but lack of funds would curtail the clinical development of Anipryl-Registered
Trademark-. There is no way to predict when, or if, regulatory approvals might
be attained in the U.S. or the timing or magnitude of the revenues from
marketing of the Company's product in the U.S. or whether any such revenues will
ever be realized.
1
Revenues totaled $815,212 for the three months ended March 31, 1996 compared to
$55,151 for the three months ended March 31, 1995 and $2,174,056 for the period
from July 19, 1990 (date of incorporation) to March 31, 1996. Interest and
investment income will continue to be the Company's primary source of income,
although revenue from Canadian sales of Anipryl-Registered Trademark- is
expected to increase in the coming months. Interest income may increase
temporarily subsequent to the receipt of funding from the Draxis Distribution
Agreement but will continue to decline over time as a result of fewer funds
being available for investment as the Company continues its Anipryl-Registered
Trademark- research and development program. The Company will also continue to
incur interest expense associated with the 1994 and 1996 Draxis Financings.
(See discussion of the 1994 and 1996 Draxis Financings in "Liquidity and Capital
Resources" below.) The Company received other revenue of $125,000 during the
three months ended March 31, 1996, from Draxis Health Inc. in accordance with
the Draxis Distribution Agreement. The Company also received other revenue of
$175,000 during the three months ended March 31, 1996, from Hoechst Veterinae in
connection with the License and Supply Agreement the Company signed during 1994.
Total expenses for the three months ended March 31, 1996 were $578,883 while
total expenses for the three months ended March 31, 1995 and for the period from
July 19, 1990 (date of incorporation) to March 31, 1996 were $689,173, and
$12,202,936, respectively. Total expenses result primarily from research and
development expenses associated with the Company's pivotal (Phase III
equivalent) clinical trials under the Anipryl-Registered Trademark- development
program, development of the marketing and sales plan for the U.S. launch of
Anipryl-Registered Trademark-, general operating expenses and interest expense
resulting from the 1994 and 1996 Draxis Financings. Total expenses are expected
to increase somewhat during the remainder of 1996, due to preparation for the
U.S. marketing and sales of Anipryl-Registered Trademark- for Cushing's disease
and continuation of the Anipryl-Registered Trademark- development program.
Operating expenses continue to remain within expectations.
Research and development expenses for the three months ended March 31, 1996
aggregated $269,407 compared to $420,072 for the three months ended March 31,
1995 and $5,910,232 for the period from July 19, 1990 (date of incorporation) to
March 31, 1996. Research and development expenses relate primarily to
activities required to obtain pre-marketing regulatory approval for
Anipryl-Registered Trademark- for use in pet dogs.
During the three months ended March 31, 1996, the Company incurred interest
expense aggregating $44,014 compared to $77,007 for the corresponding period in
1995, and $572,536 for the period from inception to March 31, 1996. Interest
expense is comprised of interest expense and amortization of debt issuance costs
associated with the Draxis Financings. Debt issuance costs aggregating $155,200
are being amortized over the term of the debt using the effective interest
method. (See discussion of Draxis Financings in "Liquidity and Capital
Resources" below.)
The Company had its first operating quarter of net income of $236,329 or $.03
per share compared to a net loss of $634,022 or $.10 per share, for the three
month period ended March 31, 1995. This income was the result of a one time
event and the Company does not expect net income in the second quarter. Net
losses for the period from inception to March 31, 1996 aggregate $10,028,880, or
$1.61 per share.
The Company is in discussions with Hoechst Veterinae to regain the European
rights to the veterinary pharmaceutical Anipryl-Registered Trademark-. The
Company is currently evaluating the best alternatives to accelerate the
availability of Anipryl-Registered Trademark- in Europe.
2
LIQUIDITY AND CAPITAL RESOURCES
As of March 31, 1996, the Company had cash and cash equivalents of $2,072,586 of
which $2,019,173 is held in U.S. and Canadian interest-bearing accounts and
$53,413 is held in U.S. non-interest bearing operating accounts compared to
$1,054,759 as of December 31, 1995.
In January, 1996, in order to obtain working capital through 1996 and to enhance
its capability to market its first approved product in Canada, the Company
signed an agreement with Draxis providing Draxis a ten-year exclusive
distribution right in Canada for Anipryl-Registered Trademark-. As part of the
Draxis Distribution Agreement, Draxis converted, at the request of the Company,
approximately $1.5 million of debt it had previously loaned the Company in 1994
(the "1994 Draxis Financing") into common stock of the Company at a renegotiated
exercise price of $1.55 per share, and provided another $1 million to the
Company for operating capital in 1996 as convertible debt also with a conversion
price of $1.55 per share (the "1996 Draxis Financing"). The repayment terms for
the 1996 Draxis Financing are substantially equivalent to the terms described
below for the 1994 Draxis Financing, with installment payments commencing
October 1, 1999 and ending October 1, 2003. To meet requirements of the Toronto
Stock Exchange, this new debt is subject to approval by a majority of votes cast
by the non-affiliate shareholders of the Company, at its next annual meeting of
shareholders. As a result of the conversion of debt, Draxis now owns
approximately 44% of the Company's common stock, with options to convert the
remaining debt that if fully converted would provide Draxis with an ownership
position in the Company of approximately 52%. The Company anticipates that it
will require further funding in order to complete the regulatory process in the
United States; and market its product and is directing efforts toward this goal.
In connection with a Loan Agreement dated August 25, 1992 relating to the
Company's investment in Phoenix Scientific, Inc., the Company was required to
pay Draxis U.S.$250,000 on July 1, 1994 and U.S.$200,000 on October 1, 1994
pursuant to two promissory notes. The Company was also required to pay DAH
(Canada), a wholly-owned subsidiary of Draxis, U.S.$140,000 upon demand
(collectively, the "Notes"). As of March 24, 1994 and subject to certain terms
and conditions, the Company and Draxis entered into the 1994 Draxis Financing
whereby Draxis provided additional funding of U.S.$2,500,000 on May 1, 1994, to
the Company so that the Company could continue pursuing the development and
regulatory approval process of Anipryl-Registered Trademark-. Contemporaneously,
the Company paid to Draxis an up-front fee of U.S.$155,200. Pursuant to the
1994 Draxis Financing, Draxis also agreed to extend the repayment of the Notes
until 1997. Furthermore, the parties agreed to amend the Notes to provide that
all amounts due thereunder may be converted at the option of Draxis, upon
written notice to the Company, into shares of Common Stock of the Company at
U.S.$2.88 per share.
The portion of the 1994 loan that was not converted in the 1996 Draxis Financing
as part of the consideration for the Draxis Distribution Agreement is repayable
as to (i) 60% of the outstanding amount in equal quarterly installments payable
on the last day of each quarter commencing January 1, 1997 and ending January 1,
2001, and (ii) 40% in a lump sum on January 1, 2001, together with interest
thereon payable quarterly on the last day of each quarter at an annual rate
equal to the prime rate plus 1% on the outstanding principal amount commencing
on the date of the loan.
In addition, the remaining portion of this loan may be converted, upon written
notice to the Company, into: (a) shares of Common Stock of the Company at
U.S.$2.88 per share; or (b) a participation interest, in increments of
U.S.$250,000, payable in annual installments until December 31, 2003.
Participation Interest is defined as an entitlement to receive an amount per
annum until December 31, 2003 equal to (i) 28% of the converted principal and
unpaid and accrued interest commencing the date of conversion by Draxis, if
Draxis converts prior to the receipt by the Company of FDA approval of
Anipryl-Registered Trademark- but after receipt of HPB approval of
Anipryl-Registered Trademark-; or (ii) 20% of the converted principal and unpaid
and unpaid interest commencing
3
the date of conversion by Draxis, if Draxis converts after the receipt by the
Company of FDA approval of Anipryl-Registered Trademark- and HPB approval of
Anipryl-Registered Trademark-. Participation interest payments will decrease to
2/3 of the amount required to be paid for the year ending December 31, 2004, and
to 1/3 of such amount for the year ending December 31, 2005.
In the event a participation interest payment exceeds 50% of the Company's pre-
tax net income during any fiscal year, the difference between the participation
interest payment and 50% of such pre-tax net income shall be paid in the form of
shares of the Company at the average price of U.S.$2.88 per share. Draxis has
further agreed not to convert more than 50% of the loan into a participation
interest in any calendar year. The 1996 Draxis Financing does not contain a
provision for conversion into a participation interest. Under certain terms and
conditions, the Company shall be required to register any shares acquired by
Draxis under any of the above-mentioned terms with the Securities and Exchange
Commission.
The Company agrees that any additional debt which may be incurred by the
Company, with a repayment term exceeding one year, shall be subordinated to the
Company's outstanding indebtedness to Draxis. The Company may prepay any
amounts outstanding at sixty (60) days written notice to Draxis, during which
time Draxis retains the right to exercise any remaining conversion privileges.
The ability of the Company to achieve its goal of bringing Anipryl-Registered
Trademark- to the U.S. market for use in dogs is dependent, in part, upon the
Company's ability to raise adequate funding and to gain FDA regulatory approval
of its product. There can be no assurance that the remaining capital will be
sufficient to implement the Company's objective of obtaining pre-marketing
approval of Anipryl-Registered Trademark- in the U.S. The Company has invested
the proceeds from its financing activities primarily in short-term or liquid
investments, so that the Company will be able to access its cash requirements as
needed for its development plan during 1996. Insufficient funding may require
the Company to delay or eliminate expenditures relating to the marketing of the
product and further development. The Company is currently considering options
for additional funding. The Board of Directors appointed a committee of
independent members to evaluate any proposals that may arise. The Committee has
retained an investment banking firm to assist with the analysis and negotiations
of any such proposals. Draxis has indicated an interest in further supporting
the Company's efforts and has submitted a proposal for consideration. It is not
possible at this time to predict with assurance whether any of these activities
will result in additional funding for the Company. Based upon the Company's
current level of expenditures, the Company has funds to support its development
program through year-end 1996.
PART II. - OTHER INFORMATION
ITEM 1-6. NONE
4
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, thereunto duly authorized.
DEPRENYL ANIMAL HEALTH, INC.
Date May 10, 1996 By: /s/ David R. Stevens
------------------------------------
David R. Stevens
President, Chief Executive Officer, and
Chief Financial Officer