DISCOVERY LABORATORIES, INC.
SUPPLEMENT DATED JULY 11, 2000
TO PROSPECTUS DATED NOVEMBER 4, 1999
This Supplement should be read in conjunction with the Prospectus
dated November 4, 1999, contained in Registration Statement No. 333-86105 of
Discovery Laboratories, Inc. (the "Company") including the exhibits hereto. The
Selling Securityholder Table is amended by deleting the reference to Paramount
Capital, Inc., and adding the persons listed in the table below as Selling
Securityholders. Paramount Capital, Inc. has distributed certain unit purchase
options to the persons in the table below, who are employees of Paramount
Capital, Inc. Paramount Capital, Inc. has acted as placement agent for the
Company and may be deemed to be an affiliate of the Company.
Number of
Shares of Number of Total
Common Shares Number of Number of Number Percentage
Stock, not Represented Shares of Percentage Shares to be of Shares to be
including by Common Beneficially Offered for to be Beneficially
Warrants, Warrants Stock Owned the Account Owned Owned
Beneficially Beneficially Beneficially Before of Selling After this After this
Name Owned Owned Owned + Offering Stockholders Offering Offering
- --------------------------- -------------- ------------ ------------- ------------ --------------- ----------- ------------
Lindsay Rosenwald1 2,784,975 703, 134 3,488,109 16.29% 168,802 3,319,307 15.63%
Wayne Rubin 0 70,936 70,936 * 24,298 46,638 *
John Knox 0 3,300 3,300 * 3,038 262 *
John Papadimitropoulos 0 3,038 3,038 * 3,038 0 *
Karl Ruggeberg 5,631 13,224 18,855 * 13,224 18,855 *
Scott Katzmann 0 245,143 245,143 1.17% 182,558 62,585 *
Andrew Daniels 0 10,000 10,000 * 10,000 0 *
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* Less than 1%.
+ The information contained in this table reflects "beneficial" ownership of
common stock within the meaning of Rule 13d-3 under the Exchange Act. On
May 8, 2000, the Company had 20,788,449 shares of common stock outstanding.
Beneficial ownership information reflected in the table includes shares
issuable upon the exercise of outstanding warrants issued by the Company.
- --------------
1 Includes shares beneficially owned by RAQ, LLC and Aries Domestic
Fund, L.P. ("Aries Domestic") and The Aries Master Fund, a Cayman Island
Exempted Corporation ("Aries Fund" and, together with Aries Domestic, "Aries").
Lindsay Rosenwald is Chairman, President and sole stockholder of Paramount
Capital, Inc. ("Paramount Capital"). Dr. Rosenwald is also Chairman, President
and sole stockholder of Paramount Capital Asset Management, Inc. ("PCAM"). PCAM
is the general partner of Aries Domestic and the investment manager of Aries
Fund. As a consequence of these relationships, each of Dr. Rosenwald and PCAM
may be deemed to share beneficial ownership of the Common Stock beneficially
owned by Aries. Dr. Rosenwald is also the Managing Member of RAQ, LLC and,
accordingly, may be deemed to have beneficial ownership of the Common Stock
beneficially owned by RAQ, LLC. Dr. Rosenwald disclaims beneficial ownership of
any securities issuable upon exercise of warrants held by employees of Paramount
Capital.