As filed with the Securities and Exchange Commission on April 5, 2005
Registration Number 333-115471
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
POST-EFFECTIVE AMENDMENT NO. 1 TO FORM S-3 TO
FORM SB-2
ON
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
CALLISTO PHARMACEUTICALS, INC.
(Name of Small Business Issuer in its Charter)
Delaware 13-3894575
(State or other jurisdiction (I.R.S. Employer)
of incorporation or organization) Identification No.)
420 Lexington Avenue, Suite 1609
New York, New York 10170
(212) 297-0010
(Address, including zip code, and telephone number, including area code
of registrant's principal executive offices)
Gary S. Jacob
Chief Executive Officer
Callisto Pharmaceuticals, Inc.
420 Lexington Avenue, Suite 1609
New York, New York 10170
(212) 297-0010
(Name, address, including zip code, and telephone number,
including area code of agent for service)
Copies to:
Jeffrey J. Fessler, Esq.
Sichenzia Ross Friedman Ference LLP
1065 Avenue of the Americas, 21st Floor
New York, New York 10018
(212) 930-9700
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 to be 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, 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, please 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, please 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. [ ]
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATE(S)
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 COMMISSION ACTING PURSUANT TO SAID SECTION
8(a) MAY DETERMINE.
The information in this prospectus is not complete and may be changed. The
securities may not be sold until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
PROSPECTUS
CALLISTO PHARMACEUTICALS, INC.
5,605,431 Shares of Common Stock
The selling stockholders named in this prospectus are offering to sell
up to 5,605,431 shares of common stock of Callisto Pharmaceuticals, Inc. which
are currently issued and outstanding and were previously issued by us to the
selling stockholders in private transactions. We will not receive any proceeds
from the resale of shares of our common stock.
Our common stock currently trades on the American Stock Exchange under
the symbol "KAL." On April 4, 2005, the last reported sale price for our common
stock on the American Stock Exchange was $1.36 per share.
The securities offered in this prospectus involve a high degree of
risk. See "Risk Factors" beginning on page 6 of this prospectus to read about
factors you should consider before buying shares of our common stock.
The selling stockholders are offering these shares of common stock. The
selling stockholders may sell all or a portion of these shares from time to time
in market transactions through any market on which our common stock is then
traded, in negotiated transactions or otherwise, and at prices and on terms that
will be determined by the then prevailing market price or at negotiated prices
directly or through a broker or brokers, who may act as agent or as principal or
by a combination of such methods of sale. The selling stockholders will receive
all proceeds from the sale of the common stock. For additional information on
the methods of sale, you should refer to the section entitled "Plan of
Distribution."
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined whether
this prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The date of this Prospectus is April _____, 2005
TABLE OF CONTENTS
Page
Where You Can Find More Information........................................ 2
Incorporation of Documents By Reference.................................... 2
Summary.................................................................... 2
Risk Factors............................................................... 4
Forward-Looking Statements................................................. 12
Use of Proceeds............................................................ 12
Selling Stockholders....................................................... 13
Plan of Distribution....................................................... 14
Legal Matters.............................................................. 16
Experts.................................................................... 16
You may only rely on the information contained in this prospectus or that we
have referred you to. We have not authorized anyone to provide you with
different information. This prospectus does not constitute an offer to sell or a
solicitation of an offer to buy any securities other than the common stock
offered by this prospectus. This prospectus does not constitute an offer to sell
or a solicitation of an offer to buy any common stock in any circumstances in
which such offer or solicitation is unlawful. Neither the delivery of this
prospectus nor any sale made in connection with this prospectus shall, under any
circumstances, create any implication that there has been no change in our
affairs since the date of this prospectus or that the information contained by
reference to this prospectus is correct as of any time after its date.
1
WHERE YOU CAN FIND MORE INFORMATION
This prospectus is part of a registration statement that we filed on
Form S-3 with the Securities and Exchange Commission or SEC. This prospectus
does not contain all of the information in the registration statement and the
exhibits and schedules that were filed with the registration statement. You
should refer to the registration statement for additional information about us
and the common stock being offered in this prospectus. Statements made in this
prospectus regarding the contents of any contract, agreement or other document
that is filed as an exhibit to the registration statement or any document
incorporated by reference into the registration statement are not necessarily
complete, and you should review the referenced document itself for a complete
understanding of its terms.
We file annual, quarterly and special reports, proxy statements and
other information with the SEC. You may read and copy any document that we file
at the SEC's public reference facilities located at 450 Fifth Street, NW, Room
1024, Washington, DC 20549, and at the SEC's regional offices at 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661 and Woolworth Building, 233
Broadway New York, New York. Copies of all or any part of the registration
statement may be obtained from the SEC upon payment of the prescribed fee.
Information regarding the operation of the public reference rooms may be
obtained by calling the SEC at 1-800-SEC-0330. Our SEC filings are also
available to you free of charge at the SEC's web site at http://www.sec.gov.
INCORPORATION OF DOCUMENTS BY REFERENCE
The SEC allows us to 'incorporate by reference' the information into
this prospectus. This means that we can disclose important information to you by
referring you to another document filed separately with the SEC. The information
that we incorporate by reference is considered to be part of this prospectus.
Because we are incorporating by reference our future filings with the SEC, this
prospectus is continually updated and those future filings may modify or
supersede some or all of the information included or incorporated in this
prospectus. This means that you must look at all of the SEC filings that we
incorporate by reference to determine if any of the statements in this
prospectus or in any document previously incorporated by reference have been
modified or superseded. This prospectus incorporates by reference the documents
listed below and any future filings we will make with the SEC under Sections
13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 until the
selling stockholders sell all of our common stock registered under this
prospectus.
o our annual report on Form 10-KSB for the fiscal year ended December
31, 2004;
o our current reports on Form 8-K filed on February 3, 2005, February
7, 2005, February 14, 2005 and March 30, 2005; and
o the description of our common stock contained in Item 1 of our
Registration Statement on Form 8-A, dated October 22, 2004;
The information about us contained in this prospectus should be read
together with the information in the documents incorporated by reference. You
may request a copy of any or all of these filings, at no cost, by writing or
telephoning us at Callisto Pharmaceuticals, Inc., 420 Lexington Avenue, Suite
1609, New York, New York 10170, Telephone: (212) 297-0010
SUMMARY
This summary highlights information contained elsewhere in this
prospectus. You should read the entire prospectus carefully, including, the
section entitled "Risk Factors" before deciding to invest in our common stock.
Callisto Pharmaceuticals, Inc. is referred to throughout this prospectus as
"Callisto," "we" or "us."
We are a biopharmaceutical company focused on the development of drugs
to treat relapsed acute leukemia, multiple myeloma (an incurable blood cancer
that invades and proliferates in bone marrow), other cancers and osteolytic bone
disease. Our lead drug candidate, Annamycin, a drug from the anthracycline
family, earlier completed a Phase I/IIa trial in refractory leukemia patients.
Annamycin, originally developed by scientists at The University of Texas M.D.
Anderson Cancer Center to address the clinical limitations associated with
anthracycline drugs such as Adriamycin (doxorubicin) to treat cancer, is planned
to begin a Phase IIb trial in adult relapsed acute lymphocytic leukemia (ALL)
patients in mid-2005, and in pediatric relapsed ALL patients and in combination
with Ara-C (cytosine arabinoside) in relapsed acute myeloid leukemia (AML)
patients in 2005.
Our second drug candidate, Atiprimod, is a small-molecule, orally
available drug with antiproliferative and antiangiogenic activity. Atiprimod
commenced a Phase I/IIa open-label clinical trial in relapsed multiple myeloma
patients on May 26, 2004. These are patients that no longer respond to
chemotherapy, and are in advanced stages of the disease. The Phase I/IIa
clinical trial is currently being enrolled at four sites, The University of
Texas M.D. Anderson Cancer Center (Houston, TX), the Dana-Farber Cancer
Institute (Boston, MA), the St. Vincent's Comprehensive Cancer Center (New York,
NY) and the Roswell Park Cancer Institute (Buffalo, NY).
On January 6, 2004, we announced that the Office of Orphan Products
Development of the United States Food and Drug Administration (FDA) granted
orphan drug designation to Atiprimod for the treatment of multiple myeloma.
RECENT DEVELOPMENTS
On March 9, 2005 we sold and issued in a private placement an aggregate
1,985,791 shares of common stock at a per share price of $1.52, for aggregate
gross proceeds of approximately $3.02 million. Because this transaction was
completed with certain existing institutional shareholders and certain members
of our management we paid no fees to selling agents and have agreed to file a
registration statement covering resale of the shares within 30 days of the
closing.
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On March 15, 2005 we announced a second Phase I/IIa clinical trial of
Atiprimod in advanced cancer patients. The new trial is entitled: "An Open Label
Study of the Safety and Efficacy of Atiprimod Treatment for Patients with
Advanced Cancer". The trial protocol received IRB approval on February 22, 2005
at The University of Texas M.D. Anderson Cancer Center. Site initiation was
completed on March 3, 2005, and patient screening and dosing is anticipated to
begin in April, 2005.
HISTORY
In March 2002, Callisto Pharmaceuticals, Inc. ("Old Callisto")
purchased 99.7% of the outstanding common shares of Webtronics, Inc.,
("Webtronics") a public company for $400,000. Webtronics was incorporated in
Florida on February 2, 2001 and had limited operations at December 31, 2002.
On April 30, 2003, pursuant to an Agreement and Plan of Merger dated
March 10, 2003, as amended April 4, 2003, Synergy Acquisition Corp., a
wholly-owned subsidiary of Webtronics merged into Synergy Pharmaceuticals Inc.
("Synergy") and Callisto Acquisition Corp., a wholly-owned subsidiary of
Webtronics merged into Old Callisto (collectively, the "Merger"). As a result of
the Merger, Old Callisto and Synergy became wholly-owned subsidiaries of
Webtronics. In the Merger Webtronics issued 17,318,994 shares of its common
stock in exchange for outstanding Old Callisto common stock and an additional
4,395,684 shares in exchange for outstanding Synergy common stock. Old Callisto
changed its name to Callisto Research Labs, LLC ("Callisto Research") and
Webtronics changed its name to Callisto Pharmaceuticals, Inc. and changed its
state of incorporation from Florida to Delaware. Subsequently, 171,818 shares of
common stock issued to former Synergy shareholders were returned to us under the
terms of certain indemnification agreements.
Our principal executive office is located at 420 Lexington Avenue, Suite 1609,
New York, New York 10170
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RISK FACTORS
AN INVESTMENT IN OUR SHARES INVOLVES A HIGH DEGREE OF RISK. BEFORE
MAKING AN INVESTMENT DECISION, YOU SHOULD CAREFULLY CONSIDER ALL OF THE RISKS
DESCRIBED IN THIS PROSPECTUS. IF ANY OF THE RISKS DISCUSSED IN THIS PROSPECTUS
ACTUALLY OCCUR, OUR BUSINESS, FINANCIAL CONDITION AND RESULTS OF OPERATIONS
COULD BE MATERIALLY AND ADVERSELY AFFECTED. IF THIS WERE TO HAPPEN, THE PRICE OF
OUR SHARES COULD DECLINE SIGNIFICANTLY AND YOU MAY LOSE ALL OR A PART OF YOUR
INVESTMENT. THE RISK FACTORS DESCRIBED BELOW ARE NOT THE ONLY ONES THAT MAY
AFFECT US. ADDITIONAL RISKS AND UNCERTAINTIES THAT WE DO NOT CURRENTLY KNOW
ABOUT OR THAT WE CURRENTLY DEEM IMMATERIAL MAY ALSO ADVERSELY AFFECT OUR
BUSINESS, FINANCIAL CONDITION AND RESULTS OF OPERATIONS. OUR FORWARD-LOOKING
STATEMENTS IN THIS PROSPECTUS ARE SUBJECT TO THE FOLLOWING RISKS AND
UNCERTAINTIES. OUR ACTUAL RESULTS COULD DIFFER MATERIALLY FROM THOSE ANTICIPATED
BY OUR FORWARD-LOOKING STATEMENTS AS A RESULT OF THE RISK FACTORS BELOW. SEE
"FORWARD-LOOKING STATEMENTS."
RISKS RELATED TO OUR BUSINESS
WE ARE AT AN EARLY STAGE OF DEVELOPMENT AS A COMPANY, CURRENTLY HAVE NO SOURCE
OF REVENUE AND MAY NEVER BECOME PROFITABLE.
We are a development stage biopharmaceutical company. Currently, we
have no products approved for commercial sale and, to date, we have not
generated any revenue. Our ability to generate revenue depends heavily on:
o demonstration in Phase I/IIa and Phase IIb clinical trials that our two
product candidates, Atiprimod for the treatment of relapsed multiple
myeloma and Annamycin for the treatment of relapsed acute leukemia,
respectively, are safe and effective;
o the successful development of our other product candidates;
o our ability to seek and obtain regulatory approvals, including with
respect to the indications we are seeking;
o the successful commercialization of our product candidates; and
o market acceptance of our products.
All of our existing product candidates will require extensive
additional clinical evaluation, regulatory review, significant marketing efforts
and substantial investment before they could provide us with any revenue. For
example, Atiprimod for the treatment of multiple myeloma entered Phase I/IIa
clinical trials in May 2004 and Annamycin for the treatment of acute leukemia is
expected to enter a Phase IIb clinical trial in mid-2005. Our other product
candidates are in preclinical development. As a result, if we do not
successfully develop and commercialize Atiprimod or Annamycin, we will be unable
to generate any revenue for many years, if at all. We do not anticipate that we
will generate revenue for several years, at the earliest, or that we will
achieve profitability for at least several years after generating material
revenue, if at all. If we are unable to generate revenue, we will not become
profitable, and we may be unable to continue our operations.
WE HAVE INCURRED SIGNIFICANT LOSSES SINCE INCEPTION AND ANTICIPATE THAT WE WILL
INCUR CONTINUED LOSSES FOR THE FORESEEABLE FUTURE.
As of December 31, 2004, we had an accumulated deficit of $33,361,197.
We have incurred losses in each year since our inception in 1996. We incurred a
net loss of $7,543,467 and $13,106,247 for the years ended December 31, 2004 and
2003, respectively. These losses, among other things, have had and will continue
to have an adverse effect on our stockholders' equity and working capital. We
expect to incur significant and increasing operating losses for the next several
years as we expand our research and development, continue our clinical trials of
Atiprimod for the treatment of multiple myeloma, initiate our clinical trials of
Annamycin for the treatment of acute leukemias, acquire or license technologies,
advance our other product candidates into clinical development, seek regulatory
approval and, if we receive FDA approval, commercialize our products. Because of
the numerous risks and uncertainties associated with our product development
efforts, we are unable to predict the extent of any future losses or when we
will become profitable, if at all. If we are unable to achieve and then maintain
profitability, the market value of our common stock will likely decline.
WE WILL NEED TO RAISE SUBSTANTIAL ADDITIONAL CAPITAL TO FUND OUR OPERATIONS, AND
OUR FAILURE TO OBTAIN FUNDING WHEN NEEDED MAY FORCE US TO DELAY, REDUCE OR
ELIMINATE OUR PRODUCT DEVELOPMENT PROGRAMS OR COLLABORATION EFFORTS.
Our operations have consumed substantial amounts of cash since
inception. We expect to continue to spend substantial amounts to:
o complete the clinical development of our two lead product
candidates, Atiprimod for the treatment of multiple myeloma and
Annamycin for the treatment of acute leukemias;
o continue the development of our other product candidates;
o finance our general and administrative expenses;
o prepare regulatory approval applications and seek approvals for
Atiprimod and Annamycin and our other product candidates;
o license or acquire additional technologies;
o launch and commercialize our product candidates, if any such
product candidates receive regulatory approval; and
o develop and implement sales, marketing and distribution
capabilities.
4
In 2004, our cash used in operations increased significantly over 2003
and we expect that our cash used in operations will increase significantly for
the next several years. We expect that our existing capital resources will be
sufficient to fund our operations for at least the next 12 months. We will be
required to raise additional capital to complete the development and
commercialization of our current product candidates. Our future funding
requirements will depend on many factors, including, but not limited to:
o the rate of progress and cost of our clinical trials and other
development activities;
o any future decisions we may make about the scope and prioritization
of the programs we pursue;
o the costs of filing, prosecuting, defending and enforcing any
patent claims and other intellectual property rights;
o the costs and timing of regulatory approval;
o the costs of establishing sales, marketing and distribution
capabilities;
o the effect of competing technological and market developments;
o the terms and timing of any collaborative, licensing and other
arrangements that we may establish; and
o general market conditions for offerings from biopharmaceutical
companies.
To date, our sources of cash have been primarily limited to the sale of
our equity securities. We cannot be certain that additional funding will be
available on acceptable terms, or at all. To the extent that we raise additional
funds by issuing equity securities, our stockholders may experience significant
dilution. Any debt financing, if available, may involve restrictive covenants
that impact our ability to conduct our business. If we are unable to raise
additional capital when required or on acceptable terms, we may have to
significantly delay, scale back or discontinue the development and/or
commercialization of one or more of our product candidates. We also may be
required to:
o seek collaborators for our product candidates at an earlier stage
than otherwise would be desirable and on terms that are less
favorable than might otherwise be available; and
o relinquish, license or otherwise dispose of rights to technologies,
product candidates or products that we would otherwise seek to
develop or commercialize ourselves on unfavorable terms.
IF OUR AGREEMENTS WITH ANORMED INC. OR THE UNIVERSITY OF TEXAS M.D. ANDERSON
CANCER CENTER TERMINATE, OUR BUSINESS WOULD BE ADVERSELY AFFECTED.
Our business is dependent on rights we have licensed from AnorMED Inc.
and The University of Texas M.D. Anderson Cancer Center. Under the terms of the
license agreements, we are obligated to make specified payments. If we fail to
fulfill those obligations or other material obligations, the license agreements
may be terminated. If either AnorMED or The University of Texas M.D. Anderson
Cancer Center terminates its agreement with us, we will have no further rights
to utilize the intellectual property covered by the terminated agreement, we
would not be able to commercialize Atiprimod or Annamycin, as the case may be,
and our business would be adversely affected, particularly if we do not have
rights to other product candidates.
CLINICAL TRIALS INVOLVE A LENGTHY AND EXPENSIVE PROCESS WITH AN UNCERTAIN
OUTCOME, AND RESULTS OF EARLIER STUDIES AND TRIALS MAY NOT BE PREDICTIVE OF
FUTURE TRIAL RESULTS.
In order to receive regulatory approval for the commercialization of
our product candidates, we must conduct, at our own expense, extensive clinical
trials to demonstrate safety and efficacy of these product candidates. Clinical
testing is expensive, can take many years to complete and its outcome is
uncertain. Failure can occur at any time during the clinical trial process.
The results of preclinical studies and early clinical trials of our
product candidates do not necessarily predict the results of later-stage
clinical trials. Product candidates in later stages of clinical trials may fail
to show the desired safety and efficacy traits despite having progressed through
initial clinical testing. The data collected from clinical trials of our product
candidates may not be sufficient to support the submission of a new drug
application or to obtain regulatory approval in the United States or elsewhere.
Because of the uncertainties associated with drug development and regulatory
approval, we cannot determine if or when we will have an approved product for
commercialization or achieve sales or profits.
DELAYS IN CLINICAL TESTING COULD RESULT IN INCREASED COSTS TO US AND DELAY OUR
ABILITY TO GENERATE REVENUE.
We may experience delays in clinical testing of our product candidates.
We do not know whether planned clinical trials will begin on time, will need to
be redesigned or will be completed on schedule, if at all. Clinical trials can
be delayed for a variety of reasons, including delays in obtaining regulatory
approval to commence a trial, in reaching agreement on acceptable clinical trial
terms with prospective sites, in obtaining institutional review board approval
to conduct a trial at a prospective site, in recruiting patients to participate
in a trial or in obtaining sufficient supplies of clinical trial materials. Many
factors affect patient enrollment, including the size of the patient population,
the proximity of patients to clinical sites, the eligibility criteria for the
trial, competing clinical trials and new drugs approved for the conditions we
are investigating. Prescribing physicians will also have to decide to use our
product candidates over existing drugs that have established safety and efficacy
profiles. Any delays in
5
completing our clinical trials will increase our costs, slow down our product
development and approval process and delay our ability to generate revenue.
WE MAY BE REQUIRED TO SUSPEND OR DISCONTINUE CLINICAL TRIALS DUE TO UNEXPECTED
SIDE EFFECTS OR OTHER SAFETY RISKS THAT COULD PRECLUDE APPROVAL OF OUR PRODUCT
CANDIDATES.
Our clinical trials may be suspended at any time for a number of
reasons. For example, we may voluntarily suspend or terminate our clinical
trials if at any time we believe that they present an unacceptable risk to the
clinical trial patients. In addition, regulatory agencies may order the
temporary or permanent discontinuation of our clinical trials at any time if
they believe that the clinical trials are not being conducted in accordance with
applicable regulatory requirements or that they present an unacceptable safety
risk to the clinical trial patients.
Administering any product candidates to humans may produce undesirable
side effects. These side effects could interrupt, delay or halt clinical trials
of our product candidates and could result in the FDA or other regulatory
authorities denying further development or approval of our product candidates
for any or all targeted indications. Ultimately, some or all of our product
candidates may prove to be unsafe for human use. Moreover, we could be subject
to significant liability if any volunteer or patient suffers, or appears to
suffer, adverse health effects as a result of participating in our clinical
trials.
IF WE ARE UNABLE TO SATISFY REGULATORY REQUIREMENTS, WE MAY NOT BE ABLE TO
COMMERCIALIZE OUR PRODUCT CANDIDATES.
We need FDA approval prior to marketing our product candidates in the
United States of America. We commenced in May 2004 a Phase I/IIa trial of
Atiprimod for the treatment of multiple myeloma. We expect to commence a Phase
IIb clinical trial of Annamycin for the treatment of acute leukemias in the
first half of 2005. If we fail to obtain FDA approval to market our product
candidates, we will be unable to sell our product candidates in the United
States of America and we will not generate any revenue.
This regulatory review and approval process, which includes evaluation
of preclinical studies and clinical trials of a product candidate as well as the
evaluation of our manufacturing process and our contract manufacturers'
facilities, is lengthy, expensive and uncertain. To receive approval, we must,
among other things, demonstrate with substantial evidence from well-controlled
clinical trials that the product candidate is both safe and effective for each
indication where approval is sought. Satisfaction of these requirements
typically takes several years and the time needed to satisfy them may vary
substantially, based on the type, complexity and novelty of the pharmaceutical
product. We cannot predict if or when we might submit for regulatory review any
of our product candidates currently under development. Any approvals we may
obtain may not cover all of the clinical indications for which we are seeking
approval. Also, an approval might contain significant limitations in the form of
narrow indications, warnings, precautions, or contra-indications with respect to
conditions of use.
The FDA has substantial discretion in the approval process and may
either refuse to file our application for substantive review or may form the
opinion after review of our data that our application is insufficient to allow
approval of our product candidates. If the FDA does not file or approve our
application, it may require that we conduct additional clinical, preclinical or
manufacturing validation studies and submit that data before it will reconsider
our application. Depending on the extent of these or any other studies, approval
of any applications that we submit may be delayed by several years, or may
require us to expend more resources than we have available. It is also possible
that additional studies, if performed and completed, may not be considered
sufficient by the FDA to make our applications approvable. If any of these
outcomes occur, we may be forced to abandon our applications for approval, which
might cause us to cease operations.
We will also be subject to a wide variety of foreign regulations
governing the development, manufacture and marketing of our products. Whether or
not FDA approval has been obtained, approval of a product by the comparable
regulatory authorities of foreign countries must still be obtained prior to
manufacturing or marketing the product in those countries. The approval process
varies from country to country and the time needed to secure approval may be
longer or shorter than that required for FDA approval. We cannot assure you that
clinical trials conducted in one country will be accepted by other countries or
that approval in one country will result in approval in any other country.
THE COMMERCIAL SUCCESS OF OUR PRODUCT CANDIDATES WILL DEPEND UPON THE DEGREE OF
MARKET ACCEPTANCE OF THESE PRODUCTS AMONG PHYSICIANS, PATIENTS, HEALTH CARE
PAYORS AND THE MEDICAL COMMUNITY.
Our product candidates have never been commercialized for any
indication. Even if approved for sale by the appropriate regulatory authorities,
physicians may not prescribe our product candidates, in which case we could not
generate revenue or become profitable. Market acceptance of Atiprimod for the
treatment of multiple myeloma, Annamycin for the treatment of acute leukemias
and our other product candidates by physicians, healthcare payors and patients
will depend on a number of factors, including:
o acceptance by physicians and patients of each such product as a
safe and effective treatment;
o cost effectiveness;
o adequate reimbursement by third parties;
o potential advantages over alternative treatments;
o relative convenience and ease of administration; and
o prevalence and severity of side effects.
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IF OUR PRODUCT CANDIDATES ARE UNABLE TO COMPETE EFFECTIVELY WITH MARKETED CANCER
DRUGS, OUR COMMERCIAL OPPORTUNITY WILL BE REDUCED OR ELIMINATED.
We face competition from established pharmaceutical and biotechnology
companies, as well as from academic institutions, government agencies and
private and public research institutions. Many of our competitors have
significantly greater financial resources and expertise in research and
development, manufacturing, preclinical testing, conducting clinical trials,
obtaining regulatory approvals and marketing approved products than we do.
Smaller or early-stage companies may also prove to be significant competitors,
particularly through collaborative arrangements with large, established
companies. Our commercial opportunity will be reduced or eliminated if our
competitors develop and commercialize cancer drugs that are safer, more
effective, have fewer side effects or are less expensive than our product
candidates. These third parties compete with us in recruiting and retaining
qualified scientific and management personnel, establishing clinical trial sites
and patient registration for clinical trials, as well as in acquiring
technologies and technology licenses complementary to our programs or
advantageous to our business.
We expect that our ability to compete effectively will depend upon our
ability to:
o successfully and rapidly complete clinical trials and submit for
and obtain all requisite regulatory approvals in a cost-effective
manner;
o maintain a proprietary position for our products and manufacturing
processes and other related product technology;
o attract and retain key personnel;
o develop relationships with physicians prescribing these products;
and
o build an adequate sales and marketing infrastructure for our
product candidates.
Because we will be competing against significantly larger companies
with established track records, we will have to demonstrate to physicians that,
based on experience, clinical data, side-effect profiles and other factors, our
products are preferable to existing cancer drugs. If we are unable to compete
effectively in the cancer drug market and differentiate our products from
currently marketed cancer drugs, we may never generate meaningful revenue.
WE CURRENTLY HAVE NO SALES AND MARKETING ORGANIZATION. IF WE ARE UNABLE TO
ESTABLISH A DIRECT SALES FORCE IN THE UNITED STATES TO PROMOTE OUR PRODUCTS, THE
COMMERCIAL OPPORTUNITY FOR OUR PRODUCTS MAY BE DIMINISHED.
We currently have no sales and marketing organization. If any of our
product candidates are approved by the FDA, we intend to market that product
directly to hospitals in the United States of America through our own sales
force. We will incur significant additional expenses and commit significant
additional management resources to establish this sales force. We may not be
able to establish these capabilities despite these additional expenditures. We
will also have to compete with other pharmaceutical and biotechnology companies
to recruit, hire and train sales and marketing personnel. If we elect to rely on
third parties to sell our product candidates in the United States, we may
receive less revenue than if we sold our products directly. In addition, we may
have little or no control over the sales efforts of those third parties. In the
event we are unable to develop our own sales force or collaborate with a third
party to sell our product candidates, we may not be able to commercialize our
product candidates which would negatively impact our ability to generate
revenue.
WE MAY NEED OTHERS TO MARKET AND COMMERCIALIZE OUR PRODUCT CANDIDATES IN
INTERNATIONAL MARKETS.
In the future, if appropriate regulatory approvals are obtained, we
intend to commercialize our product candidates in international markets.
However, we have not decided how to commercialize our product candidates in
those markets. We may decide to build our own sales force or sell our products
through third parties. If we decide to sell our product candidates in
international markets through a third party, we may not be able to enter into
any marketing arrangements on favorable terms or at all. In addition, these
arrangements could result in lower levels of income to us than if we marketed
our product candidates entirely on our own. If we are unable to enter into a
marketing arrangement for our product candidates in international markets, we
may not be able to develop an effective international sales force to
successfully commercialize those products in international markets. If we fail
to enter into marketing arrangements for our products and are unable to develop
an effective international sales force, our ability to generate revenue would be
limited.
IF THE FDA DOES NOT APPROVE OUR CONTRACT MANUFACTURERS' FACILITIES, WE MAY BE
UNABLE TO DEVELOP OR COMMERCIALIZE OUR PRODUCT CANDIDATES.
We rely on third-party contract manufacturers to manufacture our
product candidates, and currently have no plans to develop our own manufacturing
facility. The facilities used by our contract manufacturers to manufacture our
product candidates must be approved by the FDA. If the FDA does not approve
these facilities for the manufacture of our product, we may need to fund
additional modifications to our manufacturing process, conduct additional
validation studies, or find alternative manufacturing facilities, any of which
would result in significant cost to us as well as a delay of up to several years
in obtaining approval for and manufacturing of our product candidates. In
addition, our contract manufacturers will be subject to ongoing periodic
unannounced inspection by the FDA and corresponding state agencies for
compliance with good manufacturing practices regulations, or cGMPs, and similar
foreign standards. These regulations cover all aspects of the manufacturing,
testing, quality control and record keeping relating to our product candidates.
We do not have control over our contract manufacturers' compliance with these
regulations and standards. Failure by our contract manufacturers to comply with
applicable regulations could result in sanctions being imposed on us, including
fines, injunctions, civil penalties, failure of the government to grant market
approval of drugs, delays, suspension or withdrawals of approvals, operating
restrictions and criminal prosecutions, any of which could significantly and
adversely affect our business. In addition, we have no control over our contract
manufacturers' ability to maintain adequate quality control, quality assurance
and qualified personnel. Failure by our contract manufacturers to comply with or
maintain any of these standards could adversely affect the development of our
product candidates and our business.
7
IF PRODUCT LIABILITY LAWSUITS ARE SUCCESSFULLY BROUGHT AGAINST US, WE MAY INCUR
SUBSTANTIAL LIABILITIES AND MAY BE REQUIRED TO LIMIT COMMERCIALIZATION OF OUR
PRODUCT CANDIDATES.
We face an inherent risk of product liability lawsuits related to the
testing of our product candidates, and will face an even greater risk if we sell
our product candidates commercially. Currently, we are not aware of any
anticipated product liability claims with respect to our product candidates. In
the future, an individual may bring a liability claim against us if one of our
product candidates causes, or merely appears to have caused, an injury. If we
cannot successfully defend ourselves against the product liability claim, we may
incur substantial liabilities. Regardless of merit or eventual outcome,
liability claims may result in:
o decreased demand for our product candidates;
o injury to our reputation;
o withdrawal of clinical trial participants;
o costs of related litigation;
o substantial monetary awards to patients;
o product recalls;
o loss of revenue; and
o the inability to commercialize our product candidates.
We have "clinical trial" liability insurance with a $3,000,000 annual
aggregate limit for up to 40 patients participating in our Atiprimod and
prospective Annamycin clinical trials. We intend to expand our insurance
coverage to include the sale of commercial products if marketing approval is
obtained for our product candidates. Our current insurance coverage may prove
insufficient to cover any liability claims brought against us. In addition,
because of the increasing costs of insurance coverage, we may not be able to
maintain insurance coverage at a reasonable cost or obtain insurance coverage
that will be adequate to satisfy any liability that may arise.
EVEN IF WE RECEIVE REGULATORY APPROVAL FOR OUR PRODUCT CANDIDATES, WE WILL BE
SUBJECT TO ONGOING SIGNIFICANT REGULATORY OBLIGATIONS AND OVERSIGHT.
If we receive regulatory approval to sell our product candidates, the
FDA and foreign regulatory authorities may, nevertheless, impose significant
restrictions on the indicated uses or marketing of such products, or impose
ongoing requirements for post-approval studies. Following any regulatory
approval of our product candidates, we will be subject to continuing regulatory
obligations, such as safety reporting requirements, and additional
post-marketing obligations, including regulatory oversight of the promotion and
marketing of our products. If we become aware of previously unknown problems
with any of our product candidates here or overseas or our contract
manufacturers' facilities, a regulatory agency may impose restrictions on our
products, our contract manufacturers or on us, including requiring us to
reformulate our products, conduct additional clinical trials, make changes in
the labeling of our products, implement changes to or obtain re-approvals of our
contract manufacturers' facilities or withdraw the product from the market. In
addition, we may experience a significant drop in the sales of the affected
products, our reputation in the marketplace may suffer and we may become the
target of lawsuits, including class action suits. Moreover, if we fail to comply
with applicable regulatory requirements, we may be subject to fines, suspension
or withdrawal of regulatory approvals, product recalls, seizure of products,
operating restrictions and criminal prosecution. Any of these events could harm
or prevent sales of the affected products or could substantially increase the
costs and expenses of commercializing and marketing these products.
WE RELY ON THIRD PARTIES TO CONDUCT OUR CLINICAL TRIALS. IF THESE THIRD PARTIES
DO NOT SUCCESSFULLY CARRY OUT THEIR CONTRACTUAL DUTIES OR MEET EXPECTED
DEADLINES, WE MAY NOT BE ABLE TO SEEK OR OBTAIN REGULATORY APPROVAL FOR, OR
COMMERCIALIZE OUR PRODUCT CANDIDATES.
We have agreements with third-party contract research organizations, or
CROs, to provide monitors for and to manage data for our clinical programs. We
and our CROs are required to comply with current Good Clinical Practices, or
GCPs, regulations and guidelines enforced by the FDA for all of our products in
clinical development. The FDA enforces GCPs through periodic inspections of
trial sponsors, principal investigators and trial sites. In the future, if we or
our CROs fail to comply with applicable GCPs, the clinical data generated in our
clinical trials may be deemed unreliable and the FDA may require us to perform
additional clinical trials before approving our marketing applications. We
cannot assure you that, upon inspection, the FDA will determine that any of our
clinical trials for products in clinical development comply with GCPs. In
addition, our clinical trials must be conducted with product produced under cGMP
regulations, and will require a large number of test subjects. Our failure to
comply with these regulations may require us to repeat clinical trials, which
would delay the regulatory approval process.
If any of our relationships with these third-party CROs terminate, we
may not be able to enter into arrangements with alternative CROs. If CROs do not
successfully carry out their contractual duties or obligations or meet expected
deadlines, if they need to be replaced, or if the quality or accuracy of the
clinical data they obtain is compromised due to the failure to adhere to our
clinical protocols, regulatory requirements or for other reasons, our clinical
trials may be extended, delayed or terminated, and we may not be able to obtain
regulatory approval for or successfully commercialize our product candidates. As
a result, our financial results and the commercial prospects for our product
candidates would be harmed, our costs could increase, and our ability to
generate revenue could be delayed.
IF WE FAIL TO ATTRACT AND KEEP SENIOR MANAGEMENT AND KEY SCIENTIFIC PERSONNEL,
WE MAY BE UNABLE TO SUCCESSFULLY DEVELOP OUR PRODUCT CANDIDATES, CONDUCT OUR
CLINICAL TRIALS AND COMMERCIALIZE OUR PRODUCT CANDIDATES.
8
Our success depends in part on our continued ability to attract, retain
and motivate highly qualified management, clinical and scientific personnel and
on our ability to develop and maintain important relationships with leading
academic institutions, clinicians and scientists. We are highly dependent upon
our senior management and scientific staff, particularly Gary S. Jacob, our
Chief Executive Officer, and Donald Picker, our Executive Vice President, R&D.
The loss of services of Dr. Jacob, Dr. Picker or one or more of our other
members of senior management could delay or prevent the successful completion of
our planned clinical trials or the commercialization of our product candidates.
The competition for qualified personnel in the biotechnology and
pharmaceuticals field is intense. We will need to hire additional personnel as
we expand our clinical development and commercial activities. We may not be able
to attract and retain quality personnel on acceptable terms given the
competition for such personnel among biotechnology, pharmaceutical and other
companies. We do not carry "key person" insurance covering any members of our
senior management.
IF WE FAIL TO ACQUIRE AND DEVELOP OTHER PRODUCTS OR PRODUCT CANDIDATES, WE MAY
BE UNABLE TO GROW OUR BUSINESS.
To date, we have in-licensed or acquired the rights to each of our
product candidates. As part of our growth strategy, we intend to license or
acquire additional products and product candidates for development and
commercialization. Because we have limited internal research capabilities, we
are dependent upon pharmaceutical and biotechnology companies and other
researchers to sell or license products to us. The success of this strategy
depends upon our ability to identify, select and acquire the right
pharmaceutical product candidates and products.
Any product candidate we license or acquire may require additional
development efforts prior to commercial sale, including extensive clinical
testing and approval by the FDA and applicable foreign regulatory authorities.
All product candidates are prone to the risks of failure inherent in
pharmaceutical product development, including the possibility that the product
candidate will not be shown to be sufficiently safe and effective for approval
by regulatory authorities. In addition, we cannot assure you that any products
that we license or acquire that are approved will be manufactured or produced
economically, successfully commercialized or widely accepted in the marketplace.
Proposing, negotiating and implementing an economically viable product
acquisition or license is a lengthy and complex process. Other companies,
including those with substantially greater financial, marketing and sales
resources, may compete with us for the acquisition or license of product
candidates and approved products. We may not be able to acquire or license the
rights to additional product candidates and approved products on terms that we
find acceptable, or at all.
WE MAY UNDERTAKE ACQUISITIONS IN THE FUTURE, AND ANY DIFFICULTIES FROM
INTEGRATING THESE ACQUISITIONS COULD DAMAGE OUR ABILITY TO ATTAIN OR MAINTAIN
PROFITABILITY.
We may acquire additional businesses, products or product candidates
that complement or augment our existing business. Integrating any newly acquired
business or product could be expensive and time-consuming. We may not be able to
integrate any acquired business or product successfully or operate any acquired
business profitably. Moreover, we many need to raise additional funds through
public or private debt or equity financing to make acquisitions, which may
result in dilution to stockholders and the incurrence of indebtedness that may
include restrictive covenants.
WE WILL NEED TO INCREASE THE SIZE OF OUR ORGANIZATION, AND WE MAY EXPERIENCE
DIFFICULTIES IN MANAGING GROWTH.
We are a small company with 5 full-time and 2 part-time employees as of
March 31, 2005. To continue our clinical trials and commercialize our product
candidates, we will need to expand our employee base for managerial,
operational, financial and other resources. Future growth will impose
significant added responsibilities on members of management, including the need
to identify, recruit, maintain and integrate additional employees. Our future
financial performance and our ability to commercialize our product candidates
and to compete effectively will depend, in part, on our ability to manage any
future growth effectively. To that end, we must be able to:
o manage our clinical trials effectively;
o manage our development efforts effectively;
o integrate additional management, administrative, manufacturing and
sales and marketing personnel;
o maintain sufficient administrative, accounting and management
information systems and controls; and
o hire and train additional qualified personnel.
We may not be able to accomplish these tasks, and our failure to
accomplish any of them could harm our financial results.
REIMBURSEMENT MAY NOT BE AVAILABLE FOR OUR PRODUCT CANDIDATES, WHICH COULD
DIMINISH OUR SALES.
Market acceptance and sales of our product candidates may depend on
reimbursement policies and health care reform measures. The levels at which
government authorities and third-party payors, such as private health insurers
and health maintenance organizations, reimburse patients for the price they pay
for our products could affect whether we are able to commercialize these
products. We cannot be sure that reimbursement will be available for any of
these products. Also, we cannot be sure that reimbursement amounts will not
reduce the demand for, or the price of, our products. We have not commenced
efforts to have our product candidates reimbursed by government or third party
payors. If reimbursement is not available or is available only to limited
levels, we may not be able to commercialize our products.
9
In recent years, officials have made numerous proposals to change the
health care system in the United States. These proposals include measures that
would limit or prohibit payments for certain medical treatments or subject the
pricing of drugs to government control. In addition, in many foreign countries,
particularly the countries of the European Union, the pricing of prescription
drugs is subject to government control. If our products are or become subject to
government regulation that limits or prohibits payment for our products, or that
subject the price of our products to governmental control, we may not be able to
generate revenue, attain profitability or commercialize our products.
As a result of legislative proposals and the trend towards managed
health care in the United States, third-party payers are increasingly attempting
to contain health care costs by limiting both coverage and the level of
reimbursement of new drugs. They may also refuse to provide any coverage of uses
of approved products for medical indications other than those for which the FDA
has granted market approvals. As a result, significant uncertainty exists as to
whether and how much third-party payers will reimburse patients for their use of
newly-approved drugs, which in turn will put pressure on the pricing of drugs.
LEGISLATIVE OR REGULATORY REFORM OF THE HEALTHCARE SYSTEM MAY AFFECT OUR ABILITY
TO SELL OUR PRODUCTS PROFITABLY.
In both the United States and certain foreign jurisdictions, there have
been a number of legislative and regulatory proposals to change the healthcare
system in ways that could impact upon our ability to sell our products
profitably. In recent years, new legislation has been proposed in the United
States at the federal and state levels that would effect major changes in the
healthcare system, either nationally or at the state level.
These proposals have included prescription drug benefit proposals for
Medicare beneficiaries introduced in Congress. Legislation creating a
prescription drug benefit and making certain changes in Medicaid reimbursement
has recently been enacted by Congress and signed by the President. Given this
legislation's recent enactment, it is still too early to determine its impact on
the pharmaceutical industry and our business. Further federal and state
proposals are likely. The potential for adoption of these proposals affects or
will affect our ability to raise capital, obtain additional collaborators and
market our products. We expect to experience pricing pressures in connection
with the sale of our products due to the trend toward managed health care, the
increasing influence of health maintenance organizations and additional
legislative proposals. Our results of operations could be adversely affected by
future healthcare reforms.
RISKS RELATED TO OUR INTELLECTUAL PROPERTY
IT IS DIFFICULT AND COSTLY TO PROTECT OUR PROPRIETARY RIGHTS, AND WE MAY NOT BE
ABLE TO ENSURE THEIR PROTECTION.
Our commercial success will depend in part on obtaining and maintaining
patent protection and trade secret protection of our product candidates, and the
methods used to manufacture them, as well as successfully defending these
patents against third-party challenges. We will only be able to protect our
product candidates from unauthorized making, using, selling, offering to sell or
importation by third parties to the extent that we have rights under valid and
enforceable patents or trade secrets that cover these activities.
As of March 31, 2005, we own 4 issued United States patents and have
licensed rights to 8 issued United States patents and 78 issued foreign patents,
and to 3 pending United States patent applications and 39 pending foreign patent
applications. We do not and have not had any control over the filing or
prosecution of these patents or patent applications. We may file additional
patent applications and extensions.
The patent positions of pharmaceutical and biotechnology companies can
be highly uncertain and involve complex legal and factual questions for which
important legal principles remain unresolved. No consistent policy regarding the
breadth of claims allowed in biotechnology patents has emerged to date in the
United States. The biotechnology patent situation outside the United States is
even more uncertain. Changes in either the patent laws or in interpretations of
patent laws in the United States and other countries may diminish the value of
our intellectual property. Accordingly, we cannot predict the breadth of claims
that may be allowed or enforced in our licensed patents or in third-party
patents.
The degree of future protection for our proprietary rights is uncertain
because legal means afford only limited protection and may not adequately
protect our rights or permit us to gain or keep our competitive advantage. For
example:
o others may be able to make compounds that are competitive with our
product candidates but that are not covered by the claims of our
licensed patents, or for which we are not licensed under our
license agreements;
o we or our licensors might not have been the first to make the
inventions covered by our pending patent application or the pending
patent applications and issued patents of our licensors;
o we or our licensors might not have been the first to file patent
applications for these inventions;
o others may independently develop similar or alternative
technologies or duplicate any of our technologies;
o it is possible that our pending patent application or one or more
of the pending patent applications of our licensors will not result
in issued patents;
o the issued patents of our licensors may not provide us with any
competitive advantages, or may be held invalid or unenforceable as
a result of legal challenges by third parties;
o we may not develop additional proprietary technologies that are
patentable; or
o the patents of others may have an adverse effect on our business.
10
We also may rely on trade secrets to protect our technology, especially
where we do not believe patent protection is appropriate or obtainable. However,
trade secrets are difficult to protect. While we use reasonable efforts to
protect our trade secrets, our employees, consultants, contractors, outside
scientific collaborators and other advisors may unintentionally or willfully
disclose our information to competitors. Enforcing a claim that a third party
illegally obtained and is using our trade secrets is expensive and time
consuming, and the outcome is unpredictable. In addition, courts outside the
United States are sometimes less willing to protect trade secrets. Moreover, our
competitors may independently develop equivalent knowledge, methods and
know-how.
WE MAY INCUR SUBSTANTIAL COSTS AS A RESULT OF LITIGATION OR OTHER PROCEEDINGS
RELATING TO PATENT AND OTHER INTELLECTUAL PROPERTY RIGHTS AND WE MAY BE UNABLE
TO PROTECT OUR RIGHTS TO, OR USE, OUR TECHNOLOGY.
If we choose to go to court to stop someone else from using the
inventions claimed in our licensed patents, that individual or company has the
right to ask the court to rule that these patents are invalid and/or should not
be enforced against that third party. These lawsuits are expensive and would
consume time and other resources even if we were successful in stopping the
infringement of these patents. In addition, there is a risk that the court will
decide that these patents are not valid and that we do not have the right to
stop the other party from using the inventions. There is also the risk that,
even if the validity of these patents is upheld, the court will refuse to stop
the other party on the ground that such other party's activities do not infringe
our rights to these patents.
Furthermore, a third party may claim that we are using inventions
covered by the third party's patent rights and may go to court to stop us from
engaging in our normal operations and activities, including making or selling
our product candidates. These lawsuits are costly and could affect our results
of operations and divert the attention of managerial and technical personnel.
There is a risk that a court would decide that we are infringing the third
party's patents and would order us to stop the activities covered by the
patents. In addition, there is a risk that a court will order us to pay the
other party damages for having violated the other party's patents. The
biotechnology industry has produced a proliferation of patents, and it is not
always clear to industry participants, including us, which patents cover various
types of products or methods of use. The coverage of patents is subject to
interpretation by the courts, and the interpretation is not always uniform. If
we are sued for patent infringement, we would need to demonstrate that our
products or methods of use either do not infringe the patent claims of the
relevant patent and/or that the patent claims are invalid, and we may not be
able to do this. Proving invalidity, in particular, is difficult since it
requires a showing of clear and convincing evidence to overcome the presumption
of validity enjoyed by issued patents.
Because some patent applications in the United States of America may be
maintained in secrecy until the patents are issued, because patent applications
in the United States of America and many foreign jurisdictions are typically not
published until eighteen months after filing, and because publications in the
scientific literature often lag behind actual discoveries, we cannot be certain
that others have not filed patent applications for technology covered by our
licensors' issued patents or our pending applications or our licensors' pending
applications or that we or our licensors were the first to invent the
technology. Our competitors may have filed, and may in the future file, patent
applications covering technology similar to ours. Any such patent application
may have priority over our or our licensors' patent applications and could
further require us to obtain rights to issued patents covering such
technologies. If another party has filed a United States patent application on
inventions similar to ours, we may have to participate in an interference
proceeding declared by the United States Patent and Trademark Office to
determine priority of invention in the United States. The costs of these
proceedings could be substantial, and it is possible that such efforts would be
unsuccessful, resulting in a loss of our United States patent position with
respect to such inventions.
Some of our competitors may be able to sustain the costs of complex
patent litigation more effectively than we can because they have substantially
greater resources. In addition, any uncertainties resulting from the initiation
and continuation of any litigation could have a material adverse effect on our
ability to raise the funds necessary to continue our operations.
RISKS RELATED TO OUR COMMON STOCK
MARKET VOLATILITY MAY AFFECT OUR STOCK PRICE AND THE VALUE OF YOUR INVESTMENT.
The market prices for securities of biopharmaceutical companies in
general have been highly volatile and may continue to be highly volatile in the
future. The following factors, in addition to other risk factors described in
this section, may have a significant impact on the market price of our common
stock:
o announcements of technological innovations or new products by us or
our competitors;
o announcement of FDA approval or non-approval of our product
candidates or delays in the FDA review process;
o actions taken by regulatory agencies with respect to our product
candidates, clinical trials, manufacturing process or sales and
marketing activities;
o regulatory developments in the United States of America and foreign
countries;
o the success of our development efforts and clinical trials;
o the success of our efforts to acquire or in-license additional
products or product candidates;
o any intellectual property infringement action, or any other
litigation, involving us;
o announcements concerning our competitors, or the biotechnology or
biopharmaceutical industries in general;
11
o actual or anticipated fluctuations in our operating results;
o changes in financial estimates or recommendations by securities
analysts;
o sales of large blocks of our common stock;
o sales of our common stock by our executive officers, directors and
significant stockholders; and
o the loss of any of our key scientific or management personnel.
The occurrence of one or more of these factors may cause our stock
price to decline, and you may not be able to resell your shares at or above the
price you paid for your shares. In addition, the stock markets in general, and
the markets for biotechnology and biopharmaceutical stocks in particular, have
experienced extreme volatility that has often been unrelated to the operating
performance of particular companies. These broad market fluctuations may
adversely affect the trading price of our common stock.
WE ARE AT RISK OF SECURITIES CLASS ACTION LITIGATION.
In the past, securities class action litigation has often been brought
against a company following a decline in the market price of its securities.
This risk is especially relevant for us because biotechnology and
biopharmaceutical companies have experienced significant stock price volatility
in recent years. If we faced such litigation, it could result in substantial
costs and a diversion of management's attention and resources, which could harm
our business.
WE HAVE NOT PAID CASH DIVIDENDS IN THE PAST AND DO NOT EXPECT TO PAY CASH
DIVIDENDS IN THE FUTURE. ANY RETURN ON INVESTMENT MAY BE LIMITED TO THE VALUE OF
OUR STOCK.
We have never paid cash dividends on our stock and do not anticipate
paying cash dividends on our stock in the foreseeable future. The payment of
cash dividends on our stock will depend on our earnings, financial condition and
other business and economic factors affecting us at such time as the board of
directors may consider relevant. If we do not pay cash dividends, our stock may
be less valuable because a return on your investment will only occur if our
stock price appreciates.
FORWARD-LOOKING STATEMENTS
The Private Securities Litigation Reform Act of 1995 (the "Act")
provides a safe harbor for forward-looking statements made by us or on our
behalf. We and our representatives may from time to time make written or oral
statements that are "forward-looking," including statements contained in this
prospectus and other filings with the Securities and Exchange Commission,
reports to our stockholders and news releases. All statements that express
expectations, estimates, forecasts or projections are forward-looking statements
within the meaning of the Act. In addition, other written or oral statements
which constitute forward-looking statements may be made by us or on our behalf.
Words such as "expects," "anticipates," "intends," "plans," "believes," "seeks,"
"estimates," "projects," "forecasts," "may," "should," variations of such words
and similar expressions are intended to identify such forward-looking
statements. These statements are not guarantees of future performance and
involve risks, uncertainties and assumptions which are difficult to predict.
Therefore, actual outcomes and results may differ materially from what is
expressed or forecasted in or suggested by such forward-looking statements. We
undertake no obligation to update publicly any forward-looking statements,
whether as a result of new information, future events or otherwise. Among the
important factors on which such statements are based are assumptions concerning
our ability to complete ongoing clinical trials, results of our clinical trials,
the timing of approval of our products by the United States Food and Drug
Administration, our ability to obtain additional financing, our ability to
attract and retain key employees, our ability to protect intellectual property,
and our ability to adapt to economic, political and regulatory conditions
affecting the healthcare industry.
USE OF PROCEEDS
We will not receive any of the proceeds from the resale of the shares.
All proceeds from the sale of these shares will be solely for the accounts of
the selling stockholders.
12
SELLING STOCKHOLDERS
Under an initial registration statement filed on May 13, 2004, we
registered 6,056,541 shares of common stock that were acquired in a private
placement from November 2003 through January 2004 and in April 2004. Since
August 12, 2004, 451,110 of such shares have been sold under such registration
statement. The remaining 5,605,431 shares are eligible for resale pursuant to
this prospectus. The following table lists certain information with respect to
the selling stockholders as follows: (i) each selling stockholder's name, (ii)
the number of outstanding shares of common stock beneficially owned by the
selling stockholders prior to this offering, (iii) the number of shares sold
under the prior registration statement, (iv) the number of remaining shares to
be sold under this registration statement and (v) the number of shares of common
stock to be beneficially owned by each selling stockholder after the completion
of this offering assuming the sale of all of the shares of the common stock
offered by each selling stockholder. Except as noted, none of the selling
stockholders have had any position, office, or other material relationship with
us or any of our predecessors or affiliates within the past three years.
The selling stockholders may sell all, or none of their shares in this
offering. See "Plan of Distribution."
PRIOR TO THE OFFERING AFTER THE OFFERING
------------------------------------------------------------------------------------------------------------------------------------
SELLING STOCKHOLDER Number of Percent of Shares Number of Shares Number of Number of Percent of Shares
Shares Beneficially Owned Already Sold in Remaining Shares Shares Beneficially
Offering Offered Owned
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Wanda H. Harrington 100,000 * -- 100,000 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
R. Merrill & Marilyn
Hunter Children's
Trust f/b/o Kathryn
Leigh Hunter 50,000 * -- 50,000 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
R. Merrill & Marilyn
Hunter Children's
Trust f/b/o
Christopher Tyler
Hunter 50,000 * -- 50,000 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
R. Merrill & Marilyn
Hunter Children's
Trust f/b/o Matthew
Reaves Hunter 50,000 * -- 50,000 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
R. Merrill & Marilyn
Hunter Children's
Trust f/b/o Julianna
Marie Hunter 50,000 * -- 50,000 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
R. Merrill Hunter 1,000,000 -- 1,000,000 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
William J. Ritger 181,666 * 166,666 -- 15,000 *
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Robert Shapiro
Revocable Trust
u/t/a dtd 4/6/94 70,000 * -- 70,000 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Jonah Jay Lobell 70,000 * -- 70,000 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Alfonse Melohn 210,000 -- 210,000 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
WMSBG-Kolel Damesek
Eliezer, Inc. 70,000 * -- 70,000 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Howard Zuckerman 34,667 * -- 34,667 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
John E.M. McConnaughy,
Jr. 70,000 * 70,000 -- -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
MLC Management Co. 140,000 * 140,000 -- -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Blenton Management
S.A. 1,110,099 -- 1,004,099 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Howard Gittis 806,000 (2) -- 400,000 (2) 406,000
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
New England Partners
Capital, L.P. 914,402 (3) -- 200,000 (3) 714,402
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Black Flower Ltd. 35,000 * -- 35,000 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Stanley Neal Tennant 100,000 * -- 100,000 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Keith C. Alliotts 35,000 * -- 35,000 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Shekhar Basu 44,444 * -- 44,444 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Greenberg Healthcare
Partners LLC 444,444 -- 444,444 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Alexandra Global
Master Fund Ltd. 250,000 -- 250,000 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Punk Ziegel & Company 100,000 * -- 100,000 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Atlas Equity I, Ltd. 200,000 -- 200,000 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
BioMed Venture
Partners, L.P. 150,000 -- 150,000 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
InvestBio Partners,
L.P. 150,000 -- 150,000 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Pamela Kaweske 22,222 * 22,222 -- -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Baffles S.A. 22,222 * -- 22,222 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
13
PRIOR TO THE OFFERING AFTER THE OFFERING
------------------------------------------------------------------------------------------------------------------------------------
SELLING STOCKHOLDER Number of Percent of Shares Number of Shares Number of Number of Percent of Shares
Shares Beneficially Owned Already Sold in Remaining Shares Shares Beneficially
Offering Offered Owned
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
SEGOES Trust 20,000 * 20,000 -- -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Hytec International,
Ltd. 8,889 * -- 8,889 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Nicholas DiFalco 22,222 * 22,222 -- -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Mark J. Sklar and
Andrea D. Sklar 10,000 * 10,000 -- -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
W. Harrison Wellford 40,000 * -- 40,000 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Orion Biomedical
Offshore Fund, LP 79,333 * -- 79,333 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Orion Biomedical
Fund, LP 365,111 -- 365,111 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Seneca Capital
International Ltd. 141,222 -- 141,222 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
Seneca Capital L.P. 81,000 * -- 81,000 -- --
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
--------------------- ---------------- ------------------- ------------------ ------------------- ---------------- -----------------
* less than 1%.
(1) Mr. Ritger is the President of The Research Works, Inc. which has a contract
with Callisto to provide equity research services. The Research Works, Inc.
received 15,000 shares of common stock for its services.
(2) Includes 406,000 shares held by the Gittis Family Foundation.
(3) NEGF II, L.P. owns 714,402 of such shares. NEGF II, L.P. is an affiliate of
New England Partners Capital, L.P.
(4) Punk Ziegel & Company LLP acted as placement agent to Callisto in the April
19, 2004 private placement pursuant to an Engagement Letter dated January 22,
2004 and was issued warrants to purchase 101,111 shares of common stock
exercisable at $2.48 per share in addition to a cash placement fee.
PLAN OF DISTRIBUTION
The selling stockholders, or their pledgees, donees, transferees, or
any of their successors in interest selling shares received from a named selling
stockholder as a gift, partnership distribution or other non-sale-related
transfer after the date of this prospectus (all of whom may be selling
stockholders) may sell the common stock offered by this prospectus from time to
time on any stock exchange or automated interdealer quotation system on which
the common stock is listed or quoted at the time of sale, in the
over-the-counter market, in privately negotiated transactions or otherwise, at
fixed prices that may be changed, at market prices prevailing at the time of
sale, at prices related to prevailing market prices or at prices otherwise
negotiated. The selling stockholders may sell the common stock by one or more of
the following methods, without limitation:
o Block trades in which the broker or dealer so engaged will attempt to
sell the common stock as agent but may position and resell a portion of
the block as principal to facilitate the transaction;
o An exchange distribution in accordance with the rules of any stock
exchange on which the common stock is listed;
o Ordinary brokerage transactions and transactions in which the broker
solicits purchases;
o Privately negotiated transactions;
o In connection with short sales of company shares;
o Through the distribution of common stock by any selling stockholder to
its partners, members or stockholders;
o By pledge to secure debts of other obligations;
o In connection with the writing of non-traded and exchange-traded call
options, in hedge transactions and in settlement of other transactions
in standardized or over-the-counter options;
o Purchases by a broker-dealer as principal and resale by the
broker-dealer for its account; or
o In a combination of any of the above.
14
These transactions may include crosses, which are transactions in which the
same broker acts as an agent on both sides of the trade. The selling
stockholders may also transfer the common stock by gift. We do not know of any
arrangements by the selling stockholders for the sale of any of the common
stock.
The selling stockholders may engage brokers and dealers, and any brokers or
dealers may arrange for other brokers or dealers to participate in effecting
sales of the common stock. These brokers or dealers may act as principals, or as
an agent of a selling stockholder. Broker-dealers may agree with a selling
stockholder to sell a specified number of the stocks at a stipulated price per
share. If the broker-dealer is unable to sell common stock acting as agent for a
selling stockholder, it may purchase as principal any unsold shares at the
stipulated price. Broker-dealers who acquire common stock as principals may
thereafter resell the shares from time to time in transactions in any stock
exchange or automated interdealer quotation system on which the common stock is
then listed, at prices and on terms then prevailing at the time of sale, at
prices related to the then-current market price or in negotiated transactions.
Broker-dealers may use block transactions and sales to and through
broker-dealers, including transactions of the nature described above. The
selling stockholders may also sell the common stock in accordance with Rule 144
or Rule 144A under the Securities Act, rather than pursuant to this prospectus.
In order to comply with the securities laws of some states, if applicable, the
shares of common stock may be sold in these jurisdictions only through
registered or licensed brokers or dealers.
From time to time, one or more of the selling stockholders may pledge,
hypothecate or grant a security interest in some or all of the shares owned by
them. The pledgees, secured parties or person to whom the shares have been
hypothecated will, upon foreclosure in the event of default, be deemed to be
selling stockholders. The number of a selling stockholder's shares offered under
this prospectus will decrease as and when it takes such actions. The plan of
distribution for that selling stockholder's shares will otherwise remain
unchanged. In addition, a selling stockholder may, from time to time, sell the
shares short, and, in those instances, this prospectus may be delivered in
connection with the short sales and the shares offered under this prospectus may
be used to cover short sales.
To the extent required under the Securities Act, the aggregate amount of
selling stockholders' shares being offered and the terms of the offering, the
names of any agents, brokers, dealers or underwriters, any applicable commission
and other material facts with respect to a particular offer will be set forth in
an accompanying prospectus supplement or a post-effective amendment to the
registration statement of which this prospectus is a part, as appropriate. Any
underwriters, dealers, brokers or agents participating in the distribution of
the common stock may receive compensation in the form of underwriting discounts,
concessions, commissions or fees from a selling stockholder and/or purchasers of
selling stockholders' shares, for whom they may act (which compensation as to a
particular broker-dealer might be less than or in excess of customary
commissions). Neither we nor any selling stockholder can presently estimate the
amount of any such compensation.
The selling stockholders and any underwriters, brokers, dealers or agents
that participate in the distribution of the common stock may be deemed to be
"underwriters" within the meaning of the Securities Act, and any discounts,
concessions, commissions or fees received by them and any profit on the resale
of the securities sold by them may be deemed to be underwriting discounts and
commissions. If a selling stockholder is deemed to be an underwriter, the
selling stockholder may be subject to certain statutory liabilities including,
but not limited to Sections 11, 12 and 17 of the Securities Act and Rule 10b-5
under the Exchange Act. Selling stockholders who are deemed underwriters within
the meaning of the Securities Act will be subject to the prospectus delivery
requirements of the Securities Act. The SEC staff is of a view that selling
stockholders who are registered broker-dealers or affiliates of registered
broker-dealers may be underwriters under the Securities Act. We will not pay any
compensation or give any discounts or commissions to any underwriter in
connection with the securities being offered by this prospectus.
A selling stockholder may enter into hedging transactions with
broker-dealers and the broker-dealers may engage in short sales of the common
stock in the course of hedging the positions they assume with that selling
stockholder, including, without limitation, in connection with distributions of
the common stock by those broker-dealers. A selling stockholder may enter into
option or other transactions with broker-dealers, who may then resell or
otherwise transfer those common stock. A selling stockholder may also loan or
pledge the common stock offered hereby to a broker-dealer and the broker-dealer
may sell the common stock offered by this prospectus so loaned or upon a default
may sell or otherwise transfer the pledged common stock offered by this
prospectus.
The selling stockholders and other persons participating in the sale or
distribution of the common stock will be subject to applicable provisions of the
Exchange Act, and the rules and regulations under the Exchange Act, including
Regulation M. This regulation may limit the timing of purchases and sales of any
of the common stock by the selling stockholders and any other person. The
anti-manipulation rules under the Exchange Act may apply to sales of common
stock in the market and to the activities of the selling stockholders and their
affiliates. Regulation M may restrict the ability of any person engaged in the
distribution of the common stock to engage in market-making activities with
respect to the particular common stock being distributed for a period of up to
five business days before the distribution. These restrictions may affect the
marketability of the common stock and the ability of any person or entity to
engage in market-making activities with respect to the common stock.
We have agreed to indemnify the selling stockholders who participated in
our January 21, 2004 private placement and our April 19, 2004 private placement
(the "Private Placement Stockholders") and any brokers, dealers and agents who
may be deemed to be underwriters, if any, of the common stock offered by this
prospectus, against specified liabilities, including liabilities under the
Securities Act. The Private Placement Stockholders have agreed to indemnify us
against specified liabilities.
The common stock offered by this prospectus was originally issued to the
Private Placement Stockholders pursuant to an exemption from the registration
requirements of the Securities Act, as amended. We agreed to register the common
stock issued to the Private Placement Stockholders under the Securities Act, and
to keep the registration statement of which this prospectus is a part effective
until three years after the effective date of the registration statement. We
have agreed to pay all expenses incident to the registration of the common stock
held by the Private Placement Stockholders in connection with this offering, but
all selling expenses related to the securities registered shall be borne by the
individual holders of such securities pro rata on the basis of the number of
shares of securities so registered on their behalf.
We cannot assure you that the selling stockholders will sell all or any
portion of the common stock offered by this prospectus. In addition, we cannot
assure you that a selling stockholder will not transfer the shares of our common
stock by other means not described in this prospectus.
15
LEGAL MATTERS
The validity of the common stock will be passed upon by Sichenzia Ross Friedman
Ference LLP, New York, New York. Sichenzia Ross Friedman Ference LLP owns an
aggregate of 22,000 shares of Callisto's common stock.
EXPERTS
The financial statements incorporated by reference in this prospectus have
been audited by BDO Seidman, LLP, an independent registered public accounting
firm, to the extent and for the periods set forth in their report incorporated
herein by reference, and are incorporated herein in reliance upon such report
given upon the authority of said firm as experts in auditing and accounting.
16
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth an estimate of the costs and expenses
payable by Callisto Pharmaceuticals, Inc. in connection with the offering
described in this registration statement. All of the amounts shown are estimates
except the Securities and Exchange Commission ("SEC") registration fee:
Securities and Exchange Commission Registration Fee $ 1,730
Printing and Engraving Expenses 2,500
Accounting Fees and Expenses 15,000
Legal Fees and Expenses 30,000
Blue Sky Fees 15,000
Miscellaneous 5,770
-------
Total $70,000
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Callisto Pharmaceuticals, Inc.'s Certificate of Incorporation provides
that to the fullest extent permitted by the Delaware General Corporation Law, a
director of the company shall not be personally liable to the company or its
stockholders for monetary damages for breach of fiduciary duty as a director.
Under current Delaware law, liability of a director may not be limited (i) for
any breach of the director's duty of loyalty to the company or its stockholders,
(ii) for acts or omissions not in good faith or that involve intentional
misconduct or a knowing violation of law, and (iii) for any transaction from
which the director derives an improper personal benefit.
The effect of the provision of Callisto's Certificate of Incorporation
is to eliminate the rights of the company and its stockholders (through
stockholders' derivative suits on behalf of the company) to recover monetary
damages against a director for breach of the fiduciary duty of care as a
director (including breaches resulting from negligent or grossly negligent
behavior) except in the situations described in clauses (i) through (iii) above.
This provision does not limit or eliminate the rights of the company or any
stockholder to seek nonmonetary relief such as an injunction or rescission in
the event of a breach of a director's duty of care. In addition, Callisto's
Certificate of Incorporation provides that the company shall indemnify to the
fullest extent permitted by law its directors, officers and employees and any
other persons to which Delaware law permits a corporation to provide
indemnification against losses incurred by any such person by reason of the fact
that such person was acting in such capacity.
Callisto has an insurance policy that insures its directors and
officers, within the limits and subject to the limitations of the policy,
against certain expenses in connection with the defense of actions, suits or
proceedings, and certain liabilities that might be imposed as a result of such
actions, suits or proceedings, to which they are parties by reason of being or
having been directors or officers.
ITEM 16. EXHIBITS
EXHIBIT
NUMBER DESCRIPTION
------------- ----------------------------------------------------------------
5.1 Opinion of Sichenzia Ross Friedman Ference LLP
23.1 Consent of BDO Seidman, LLP
23.2 Consent of Sichenzia Ross Freidman Ference LLP (included in
Exhibit 5.1)
24 Power of Attorney (included on Page II-3)*
* Previously filed.
ITEM 17. UNDERTAKINGS
1. The undersigned registrant hereby undertakes to file, during any
period in which offers or sales are being made, a post-effective amendment to
this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933.
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than 20 percent change in
the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement.
17
(iii) 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.
Provided, however, that paragraphs (i) and (ii) of this section do not
apply if the registration statement is on Form S-3, Form S-8 or Form
F-3, and the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed
with or furnished to the Commission by the Registrant pursuant to
Section 13 or Section 15(d) of the Exchange Act that are incorporated
by reference in the registration statement.
2. The undersigned registrant hereby undertakes that, for the purpose of
determining any liability under the Securities Act of 1933, as amended, 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. The undersigned registrant hereby undertakes to remove from
registration by means of a post-effective amendment any of the securities being
registered that remain unsold at the termination of the offering.
4. The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) 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.
5. Insofar as indemnification for liabilities arising under the
Securities Act of 1933, as amended, may be permitted to directors, officers and
controlling persons of the undersigned registrant according the foregoing
provisions, or otherwise, the undersigned 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 whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933, as amended, and will be governed by the final
adjudication of such issue.
6. The undersigned registrant hereby undertakes that:
(i) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as
part of this registration statement in reliance upon Rule 430A and
contained in a form of prospectus filed by the registrant pursuant to
Rule 424(b)(1)or (4) or 497(h) under the Securities Act shall be deemed
to be part of this registration statement as of the time it was
declared effective.
(ii) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus 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.
18
SIGNATURES
In accordance with the requirements of the Securities Act of 1933, as
amended, 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
Post-Effective No. 1 on Form S-3 to the Registration Statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City of New
York, State of New York, on April 5, 2005.
CALLISTO PHARMACEUTICALS, INC.
By: /s/ GARY S. JACOB
------------------------------------
Gary S. Jacob,
CHIEF EXECUTIVE OFFICER
In accordance with the requirements of the Securities Act of 1933, as
amended, this Post-Effective Amendment No. 1 on Form S-3 to the Registration
Statement has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
SIGNATURE TITLE DATE
----------------------------------- ---------------------------------------------------- -------------------------
/s/ GARY S. JACOB Chief Executive Officer and Director April 5, 2005
----------------------------------- (Principal Executive Officer)
Gary S. Jacob
/s/ BERNARD DENOYER Vice President, Finance April 5, 2005
----------------------------------- (Principal Financial and Accounting Officer)
Bernard Denoyer
/s/ GABRIELE M. CERRONE Chairman of the Board April 5, 2005
-----------------------------------
Gabriele M. Cerrone
* Director April 5, 2005
-----------------------------------
Edwin Snape
/s/ CHRISTOPH BRUENING Director April 5, 2005
-----------------------------------
Christoph Bruening
* Director April 5, 2005
-----------------------------------
John P. Brancaccio
/s/ STEPHEN CARTER Director April 5, 2005
-----------------------------------
Stephen Carter
/s/ RANDALL K. JOHNSON Director April 5, 2005
-----------------------------------
Randall K. Johnson
* By: /s/ Gary S. Jacob
-----------------
Gary S. Jacob
Attorney-in-Fact
19