x
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
|
SECURITIES
EXCHANGE ACT OF 1934
|
For
the quarterly period ended June 30, 2006
|
OR
|
o
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
|
SECURITIES
EXCHANGE ACT OF 1934
|
For
the transition period from
to
.
|
Delaware
(State
or other jurisdiction of incorporation or organization)
|
13-4087132
(I.R.S.
Employer Identification No.)
|
|
Large
accelerated filer £
|
Accelerated
filer x
|
Non-accelerated
filer £
|
Page
|
||
SPECIAL
CAUTIONARY NOTICE REGARDING FORWARD-LOOKING STATEMENTS
|
1
|
|
PART
I
|
FINANCIAL
INFORMATION
|
|
Item
1
|
Financial
Statements
|
|
Consolidated
Balance Sheets as of June 30, 2006 (unaudited) and December
31, 2005
|
2
|
|
Interim
Consolidated Statements of Operations for the three months and six
months
ended
June 30, 2006 and 2005 (unaudited)
|
3
|
|
Interim
Consolidated Statements of Cash Flows for the six months ended
June 30, 2006 and 2005 (unaudited)
|
4
|
|
Notes
to Interim Consolidated Financial Statements as of June 30, 2006
(unaudited)
|
6
|
|
Item
2
|
Management's
Discussion and Analysis of Financial Condition and Results
of Operations
|
14
|
Item
3
|
Quantitative
and Qualitative Disclosures About Market Risk
|
25
|
Item
4
|
Controls
and Procedures
|
25
|
PART
II
|
OTHER
INFORMATION
|
|
Item
1
|
Legal
Proceedings
|
26
|
Item
1A
|
Risk Factors |
27
|
Item
4
|
Submission
of Matters to a Vote of Security Holders
|
38
|
Item
6
|
Exhibits
|
39
|
·
|
expectations
for increases or decreases in expenses;
|
·
|
expectations
for the development, manufacturing, and approval of SulonexTM,
ZerenexTM,
KRX-0401, and our additional product candidates or any other products
we
may acquire or in-license;
|
·
|
expectations
for incurring additional capital expenditures to expand our research
and
development and manufacturing capabilities;
|
·
|
expectations
for generating revenue or becoming profitable on a sustained basis;
|
·
|
expectations
or ability to enter into marketing and other partnership agreements;
|
·
|
expectations
or ability to enter into product acquisition and in-licensing
transactions;
|
·
|
expectations
or ability to build our own commercial infrastructure to manufacture,
market and sell our drug
candidates;
|
·
|
estimates
of the sufficiency of our existing cash and cash equivalents and
investments to finance our business strategy;
|
·
|
expected
losses; and
|
·
|
expectations
for future capital requirements.
|
June
30, 2006
|
December
31, 2005*
|
||||||
(Unaudited)
|
|||||||
Assets
|
|||||||
Current
assets
|
|||||||
Cash
and cash equivalents
|
$
|
81,058
|
$
|
68,175
|
|||
Short-term
investment securities
|
56,322
|
18,272
|
|||||
Accrued
interest receivable
|
422
|
336
|
|||||
Other
receivables, inventory and prepaid expenses
|
4,816
|
3,200
|
|||||
Total
current assets
|
142,618
|
89,983
|
|||||
Long-term
investment securities
|
17,309
|
13,950
|
|||||
Property,
plant and equipment, net
|
2,766
|
1,004
|
|||||
Goodwill
|
3,127
|
--
|
|||||
Other
assets (primarily intangible assets), net
|
972
|
160
|
|||||
Total
assets
|
$
|
166,792
|
$
|
105,097
|
|||
Liabilities
and stockholders’ equity
|
|||||||
Current
liabilities
|
|||||||
Accounts
payable and accrued expenses
|
$
|
6,108
|
$
|
5,054
|
|||
Accrued
compensation and related liabilities
|
401
|
936
|
|||||
Deferred
revenue
|
184
|
103
|
|||||
Total
current liabilities
|
6,693
|
6,093
|
|||||
Contingent
equity rights
|
4,004
|
4,004
|
|||||
Other
liabilities
|
288
|
322
|
|||||
Total
liabilities
|
10,985
|
10,419
|
|||||
Stockholders’
equity
|
|||||||
Common
stock, $0.001 par value per share (60,000,000 and 60,000,000 shares
authorized, 43,194,075 and 37,831,896 shares issued, 43,137,975 and
37,775,796 shares outstanding at June 30, 2006, and December 31,
2005,
respectively)
|
43
|
38
|
|||||
Additional
paid-in capital
|
307,725
|
209,177
|
|||||
Treasury
stock, at cost, 56,100 shares at June 30, 2006, and December 31,
2005,
respectively
|
(89
|
)
|
(89
|
)
|
|||
Deficit
accumulated during the development stage
|
(151,872
|
)
|
(114,448
|
)
|
|||
Total
stockholders’ equity
|
155,807
|
94,678
|
|||||
Total
liabilities and stockholders’ equity
|
$
|
166,792
|
$
|
105,097
|
Three
months ended
June
30,
|
Six
months ended
June
30,
|
Amounts
accumulated during the development
|
||||||||||||||
2006
|
2005
|
2006
|
2005
|
stage
|
||||||||||||
Revenue:
|
||||||||||||||||
Diagnostic
revenue
|
$
|
23
|
$
|
--
|
$
|
23
|
$
|
--
|
$
|
23
|
||||||
Service
revenue
|
224
|
126
|
336
|
283
|
1,719
|
|||||||||||
Management
fees from related party
|
--
|
--
|
--
|
--
|
300
|
|||||||||||
Total
revenue
|
247
|
126
|
359
|
283
|
2,042
|
|||||||||||
Operating
expenses:
|
||||||||||||||||
Cost
of diagnostics sold
|
19
|
--
|
19
|
--
|
19
|
|||||||||||
Cost
of services
|
98
|
161
|
269
|
342
|
1,923
|
|||||||||||
Research
and development:
|
||||||||||||||||
Non-cash
compensation
|
2,104
|
137
|
4,828
|
313
|
12,562
|
|||||||||||
Non-cash
acquired in-process research and development
|
--
|
--
|
--
|
--
|
18,800
|
|||||||||||
Other
research and development
|
12,352
|
5,180
|
24,685
|
9,222
|
88,579
|
|||||||||||
Total
research and development
|
14,456
|
5,317
|
29,513
|
9,535
|
119,941
|
|||||||||||
Selling,
general and administrative:
|
||||||||||||||||
Non-cash
compensation
|
3,541
|
168
|
6,358
|
353
|
11,799
|
|||||||||||
Other
selling, general and administrative
|
1,860
|
699
|
4,505
|
1,344
|
29,591
|
|||||||||||
Total
selling, general and administrative
|
5,401
|
867
|
10,863
|
1,697
|
41,390
|
|||||||||||
Total
operating expenses
|
19,974
|
6,345
|
40,664
|
11,574
|
163,273
|
|||||||||||
Operating
loss
|
(19,727
|
)
|
(6,219
|
)
|
(40,305
|
)
|
(11,291
|
)
|
(161,231
|
)
|
||||||
Interest
and other income, net
|
1,899
|
267
|
2,881
|
507
|
9,850
|
|||||||||||
Net
loss before income taxes
|
(17,828
|
)
|
(5,952
|
)
|
(37,424
|
)
|
(10,784
|
)
|
(151,381
|
)
|
||||||
Income
taxes
|
--
|
--
|
--
|
--
|
491
|
|||||||||||
Net
loss
|
$
|
(17,828
|
)
|
$
|
(5,952
|
)
|
$
|
(37,424
|
)
|
$
|
(10,784
|
)
|
$
|
(151,872
|
)
|
|
Basic
and diluted loss per common share
|
$
|
(0.41
|
)
|
$
|
(0.19
|
)
|
$
|
(0.92
|
)
|
$
|
(0.34
|
)
|
$
|
(7.87
|
)
|
|
Weighted
average shares used in computing basic and diluted net loss
per common share
|
43,117,656
|
31,528,862
|
40,608,571
|
31,503,469
|
19,308,150
|
Six
months ended
June
30,
|
Amounts
accumulated
during
the
development
stage
|
|||||||||
2006
|
2005
|
|||||||||
CASH
FLOWS FROM OPERATING ACTIVITIES
|
||||||||||
Net
loss
|
$
|
(37,424
|
)
|
$
|
(10,784
|
)
|
$
|
(151,872
|
)
|
|
Adjustments
to reconcile cash flows used in operating activities:
|
||||||||||
Acquired
in-process research and development
|
--
|
--
|
18,800
|
|||||||
Stock
compensation expense
|
11,186
|
666
|
24,361
|
|||||||
Issuance
of common stock to technology licensor
|
--
|
--
|
359
|
|||||||
Interest
on convertible notes settled through issuance of preferred
shares
|
--
|
--
|
253
|
|||||||
Depreciation
and amortization
|
120
|
86
|
2,731
|
|||||||
Loss
on disposal of property, plant and equipment
|
--
|
--
|
172
|
|||||||
Impairment
charges
|
--
|
--
|
2,482
|
|||||||
Exchange
rate differences
|
--
|
--
|
94
|
|||||||
Changes
in assets and liabilities, net of effects of acquisitions:
|
||||||||||
(Increase)
in other receivables, inventory and prepaid expenses
|
(1,524
|
)
|
--
|
(4,353
|
)
|
|||||
(Increase)
in accrued interest receivable
|
(86
|
)
|
(3
|
)
|
(422
|
)
|
||||
(Increase)
in security deposits
|
(241
|
)
|
--
|
(249
|
)
|
|||||
Increase
in accounts payable and accrued expenses
|
625
|
1,194
|
4,366
|
|||||||
(Decrease)
in accrued compensation and related liabilities
|
(558
|
)
|
(709
|
)
|
(194
|
)
|
||||
(Decrease)
increase in other liabilities
|
(34
|
)
|
47
|
133
|
||||||
Increase
(decrease) in deferred revenue
|
81
|
2
|
(272
|
)
|
||||||
Net
cash used in operating activities
|
(27,855
|
)
|
(9,501
|
)
|
(103,611
|
)
|
||||
CASH
FLOWS FROM INVESTING ACTIVITIES
|
||||||||||
Purchases
of property, plant and equipment
|
(1,798
|
)
|
(330
|
)
|
(7,189
|
)
|
||||
Proceeds
from disposals of property, plant and equipment
|
--
|
--
|
425
|
|||||||
(Increase)
in note and accrued interest receivable from related party
|
--
|
--
|
(356
|
)
|
||||||
Decrease
in accrued transaction costs
|
(145
|
)
|
--
|
(145
|
)
|
|||||
Decrease
(increase) in other assets
|
27
|
(4
|
)
|
(1,192
|
)
|
|||||
(Investment
in) held-to-maturity short-term securities
|
(4,011
|
)
|
(1,103
|
)
|
(48,844
|
)
|
||||
Proceeds
from maturity of held-to-maturity short-term securities
|
1,071
|
5,528
|
44,817
|
|||||||
(Investment
in) available-for-sale short-term securities
|
(30,825
|
)
|
(25
|
)
|
(50,550
|
)
|
||||
Proceeds
from sale of available-for-sale short-term securities
|
175
|
--
|
9,850
|
|||||||
(Investment
in) held-to-maturity long-term securities
|
(7,822
|
)
|
(7,116
|
)
|
(29,092
|
)
|
||||
Proceeds
from maturity of held-to-maturity long-term securities
|
4
|
--
|
189
|
|||||||
Net
cash used in investing activities
|
(43,324
|
)
|
(3,050
|
)
|
(82,087
|
)
|
Six
months ended
June
30,
|
Amounts
accumulated
during
the
development
stage
|
|||||||||
2006
|
2005
|
|||||||||
CASH
FLOWS FROM FINANCING ACTIVITIES
|
||||||||||
Proceeds
from short-term loans
|
$
|
--
|
$
|
--
|
$
|
500
|
||||
Proceeds
from long-term loans
|
--
|
--
|
3,251
|
|||||||
Payment
of assumed notes payable and accrued interest in connection with
the
ACCESS Oncology acquisition
|
--
|
--
|
(6,322
|
)
|
||||||
Issuance
of convertible note, net
|
--
|
--
|
2,150
|
|||||||
Issuance
of preferred shares, net
|
--
|
--
|
8,453
|
|||||||
Receipts
on account of shares previously issued
|
--
|
--
|
7
|
|||||||
Proceeds
from initial public offering, net
|
--
|
--
|
46,298
|
|||||||
Proceeds
from secondary public offering, net
|
--
|
--
|
75,790
|
|||||||
Proceeds
from private placements, net
|
82,696
|
--
|
128,491
|
|||||||
Proceeds
from exercise of options and warrants
|
1,361
|
335
|
8,222
|
|||||||
Purchase
of treasury stock
|
--
|
--
|
(89
|
)
|
||||||
Net
cash provided by financing activities
|
84,057
|
335
|
266,751
|
|||||||
Cash
acquired in acquisition
|
5
|
--
|
99
|
|||||||
Effect
of exchange rate on cash
|
--
|
--
|
(94
|
)
|
||||||
NET
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
|
12,883
|
(12,216
|
)
|
81,058
|
||||||
Cash
and cash equivalents at beginning of year
|
68,175
|
29,699
|
--
|
|||||||
CASH
AND CASH EQUIVALENTS AT END OF PERIOD
|
$
|
81,058
|
$
|
17,483
|
$
|
81,058
|
||||
NON
- CASH TRANSACTIONS
|
||||||||||
Issuance
of common stock in connection with acquisition
|
$
|
3,310
|
$
|
--
|
$
|
9,635
|
||||
Issuance
of contingent equity rights in connection with acquisition
|
--
|
--
|
4,004
|
|||||||
Assumption
of liabilities in connection with acquisition
|
347
|
--
|
9,070
|
|||||||
Conversion
of short-term loans into contributed capital
|
--
|
--
|
500
|
|||||||
Conversion
of long-term loans into contributed capital
|
--
|
--
|
2,681
|
|||||||
Conversion
of long-term loans into convertible notes of Partec
|
--
|
--
|
570
|
|||||||
Conversion
of convertible notes of Partec and accrued interest into stock in
Keryx
|
--
|
--
|
2,973
|
|||||||
Issuance
of warrants to related party as finder’s fee in private
placement
|
--
|
--
|
114
|
|||||||
Declaration
of stock dividend
|
--
|
--
|
3
|
|||||||
SUPPLEMENTARY
DISCLOSURES OF CASH FLOW INFORMATION
|
||||||||||
Cash
paid for interest
|
$
|
--
|
$
|
--
|
$
|
1,166
|
||||
Cash
paid for income taxes
|
$
|
--
|
$
|
--
|
$
|
432
|
Number
of options
|
Weighted-average
exercise
price
|
Weighted-average
remaining
contractual term
(years)
|
Aggregate
intrinsic value
|
||||||||||
Outstanding
at January 1, 2006
|
8,024,652
|
$
|
4.35
|
7.2
|
$
|
119,097,000
|
|||||||
Granted
|
3,185,460
|
$
|
14.26
|
||||||||||
Exercised
|
(517,155
|
)
|
$
|
2.63
|
$
|
5,983,000
|
|||||||
Forfeited
and expired
|
(97,996
|
)
|
$
|
2.42
|
|||||||||
Outstanding
at June 30, 2006
|
10,594,961
|
$
|
7.43
|
7.9
|
$
|
74,097,000
|
|||||||
Exercisable
at June 30, 2006
|
6,221,602
|
$
|
3.52
|
7.1
|
$
|
66,516,000
|
Three
months ended
|
Six
months ended
|
||||||
(in
thousands, except per share amounts)
|
June
30, 2006
|
June
30, 2006
|
|||||
Net
loss, using previous accounting method
|
$
|
(14,147
|
)
|
$
|
(28,632
|
)
|
|
Basic
and diluted loss per ordinary share, using previous method
|
(0.33
|
)
|
(0.71
|
)
|
|||
Impact
of the adoption of SFAS No. 123R
|
(3,681
|
)
|
(8,792
|
)
|
|||
Net
loss, as reported
|
(17,828
|
)
|
(37,424
|
)
|
|||
Basic
and diluted loss per ordinary share, as reported
|
$
|
(0.41
|
)
|
$
|
(0.92
|
)
|
Three
months ended
|
Six
months ended
|
||||||
(in
thousands, except per share amounts)
|
June
30, 2005
|
June
30, 2005
|
|||||
Net
loss, as reported
|
$
|
(5,952
|
)
|
$
|
(10,784
|
)
|
|
Add:
Stock-based compensation expense to employees and directors determined
under the intrinsic value-based method, as included in reported net
loss
|
112
|
223
|
|||||
Deduct:
Stock-based compensation expense to employees and directors determined
under fair value based method
|
(1,049
|
)
|
(1,922
|
)
|
|||
Pro
forma net loss
|
$
|
(6,889
|
)
|
$
|
(12,483
|
)
|
|
Basic
and diluted loss per common share:
|
|||||||
As
reported
|
$
|
(0.19
|
)
|
$
|
(0.34
|
)
|
|
Pro
forma
|
$
|
(0.22
|
)
|
$
|
(0.40
|
)
|
(in
thousands, except share and per share amounts)
|
|||||||
Assumed
liabilities
|
347
|
||||||
Number
of shares of Keryx common stock issued
|
245,024
|
||||||
Multiplied
by Keryx’s average closing bid price per share as quoted on NASDAQ over a
period of 5 trading days (2 days prior to the Effective Date, the
Effective Date, and 2 days after the Effective Date
|
$
|
13.51
|
3,310
|
||||
Other
transaction costs
|
250
|
||||||
Total
purchase price
|
$
|
3,907
|
(in thousands)
|
||||
Allocation
of purchase price:
|
||||
Tangible
assets acquired
|
$
|
124
|
||
Amortizable
intangibles (over 12 years - patent life)
|
656
|
|||
Goodwill
|
3,127
|
|||
Purchase
price
|
$
|
3,907
|
· |
revenue
that is likely to result from the asset, including estimated selling
price, estimated market share and year-over-year growth
rates;
|
· |
operating
margin; and
|
· |
sales
and marketing and general and administrative expenses using historical
and
industry or other sources of market
data;
|
Revenue
|
||||||||||||||||
Three
months ended June 30,
|
Six
months ended June 30,
|
Amounts
accumulated during the development
|
||||||||||||||
(in
thousands)
|
2006
|
2005
|
2006
|
2005
|
Stage
|
|||||||||||
Diagnostics
|
$
|
23
|
$
|
--
|
$
|
23
|
$
|
--
|
$
|
23
|
||||||
Services
|
224
|
126
|
336
|
283
|
1,719
|
|||||||||||
Products
|
--
|
--
|
--
|
--
|
--
|
|||||||||||
Total
|
$
|
247
|
$
|
126
|
$
|
359
|
$
|
283
|
$
|
1,742
|
||||||
Operating
loss
|
||||||||||||||||
Three
months ended June 30,
|
Six
months ended June 30,
|
Amounts
accumulated during the development
|
||||||||||||||
(in
thousands)
|
2006
|
2005
|
2006
|
2005
|
Stage
|
|||||||||||
Diagnostics
|
$
|
(414
|
)
|
$
|
--
|
$
|
(414
|
)
|
$
|
--
|
$
|
(414
|
)
|
|||
Services
|
126
|
(35
|
)
|
67
|
(59
|
)
|
(204
|
)
|
||||||||
Products
|
(19,439
|
)
|
(6,184
|
)
|
(39,958
|
)
|
(11,232
|
)
|
(160,613
|
)
|
||||||
Total
|
$
|
(19,727
|
)
|
$
|
(6,219
|
)
|
$
|
(40,305
|
)
|
$
|
(11,291
|
)
|
$
|
(161,231
|
)
|
|
Net
loss
|
||||||||||||||||
Three
months ended June 30,
|
Six
months ended June 30,
|
Amounts
accumulated during the development
|
||||||||||||||
(in
thousands)
|
2006
|
2005
|
2006
|
2005
|
Stage
|
|||||||||||
Operating
loss of reportable segments
|
$
|
(19,727
|
)
|
$
|
(6,219
|
)
|
$
|
(40,305
|
)
|
$
|
(11,291
|
)
|
$
|
(161,231
|
)
|
|
Interest
and other income
|
1,899
|
267
|
2,881
|
507
|
9,850
|
|||||||||||
Income
taxes
|
--
|
--
|
--
|
--
|
491
|
|||||||||||
Consolidated
net loss
|
$
|
(17,828
|
)
|
$
|
(5,952
|
)
|
$
|
(37,424
|
)
|
$
|
(10,784
|
)
|
$
|
(151,872
|
)
|
|
Goodwill
|
|||||||
(in
thousands)
|
June
30, 2006
|
December
31, 2005
|
|||||
Diagnostics
|
--
|
--
|
|||||
Services
|
--
|
--
|
|||||
Products
|
$
|
3,127
|
--
|
||||
Total
|
$
|
3,127
|
-
|
||||
Product
candidate
|
Target
indication
|
Development
status
|
Endocrine/Renal
|
||
Sulonex™
|
Diabetic
nephropathy
|
Phase
III & Phase IV
|
Zerenex™
|
Hyperphosphatemia
in patients with
end-stage
renal disease
|
Phase
II
|
Oncology
|
||
KRX-0401
|
Multiple
forms of cancer
|
Phase
II
|
KRX-0402
|
Brain
cancer
|
Phase
II
|
KRX-0404
|
Multiple
forms of cancer
|
Pre-clinical
|
Neurology
|
||
KRX-0501
|
Neurological
disorders
|
Pre-clinical
|
Table
1: Changes in Serum Phosphorous Concentration (mg/dL) on day
28
compared
to day 0 (baseline) at Zerenex doses of 2, 4 and 6
g/day.
|
||||
Placebo
(n=16)
|
2g/day
(n=31)
|
4g/day
(n=32)
|
6g/day
(n=32)
|
|
Day
0 (Baseline)*
|
7.2
(1.4)
|
7.2
(1.2)
|
7.1
(1.3)
|
7.3
(1.3)
|
Day
28 (End of Treatment Period)*
|
7.2
(1.2)
|
6.9
(2.2)
|
6.0
(1.3)
|
5.8
(1.8)
|
Placebo
Comparison:
|
||||
Mean
Difference from Placebo
|
-0.02
|
-1.1
|
-1.5
|
|
P-value
|
NS
|
0.06
|
0.0119
|
|
Baseline
Comparison:
|
||||
Mean
Difference from Baseline
|
-0.1
|
-0.3
|
-1.1
|
-1.5
|
P-value
|
NS
|
NS
|
NS
|
<0.01
|
*mean
(standard deviation)
|
Table
2: Changes in the Calcium x Phosphorous (mg/dL) on day 28
compared
to day 0 (baseline) at Zerenex doses of 2, 4 and 6
g/day.
|
||||
Placebo
(n=16)
|
2g/day
(n=31)
|
4g/day
(n=32)
|
6g/day
(n=32)
|
|
Day
0 (Baseline)*
|
62.8
(13.9)
|
62.9
(13.2)
|
63.5
(10.7)
|
65.8
(12.2)
|
Day
28 (End of Treatment Period)*
|
63.2
(12.6)
|
61.7
(21.3)
|
55.4
(13.4)
|
54.1
(17.7)
|
Placebo
Comparison:
|
||||
Mean
Difference from Placebo
|
-0.9
|
-7.91
|
-11.4
|
|
P-value
|
0.8950
|
0.1375
|
0.0378
|
|
Baseline
Comparison:
|
||||
Mean
Difference from Baseline
|
-0.3
|
-1.1
|
-8.1
|
-11.7
|
P-value
|
NS
|
NS
|
NS
|
<0.01
|
*mean
(standard deviation)
|
Response
|
N
(%)
|
Duration
(months)
|
Partial
Response
|
3
(43%)
|
4,
4+, 9
|
Stable
Disease
|
2
(29%)
|
8+,
11
|
Progression
|
2
(29%)
|
2,
3
|
Too
Early
|
2
|
|
Not
Evaluable
|
4
|
|
Net
loss per share:
|
2005
|
2004
|
2003
|
2002
|
2001
|
|||||||||||
As
reported
|
$
|
(0.78
|
)
|
$
|
(1.10
|
)
|
$
|
(0.43
|
)
|
$
|
(0.59
|
)
|
$
|
(0.50
|
)
|
|
As
adjusted
|
$
|
(0.79
|
)
|
$
|
(1.10
|
)
|
$
|
(0.44
|
)
|
$
|
(0.60
|
)
|
$
|
(0.50
|
)
|
· |
revenue
that is likely to result from the asset, including estimated selling
price, estimated market share and year-over-year growth
rates;
|
· |
operating
margin; and
|
· |
sales
and marketing and general and administrative expenses using historical
and
industry or other sources of market
data;
|
§
|
Improve
communication between our legal counsel and our finance department
relating to stock option grants and administrative practices, including
related documentation requirements;
|
§
|
Improve
training and education designed to ensure that all relevant personnel
involved in the administration of stock option grants understand
the terms
of our stock option plans and the relevant accounting guidance under
generally accepted accounting principles for stock options and other
share-based payments; and
|
§
|
Add
additional personnel with accounting experience in the area of
compensation generally.
|
§
|
All
stock option grants to employees are to be made by the Compensation
Committee or the Board of Directors, and no authority to grant stock
options is delegated to management;
|
§
|
All
stock option grants to newly hired, promoted or special recognition
employees are to be made at the next meeting of the Compensation
Committee
or Board of Directors immediately following the date of their hiring,
promotion or recognition;
|
§
|
All
other stock option grants are to be made one time each year, at the
meeting of the Compensation Committee or Board of Directors held
during
the fourth fiscal quarter; and
|
§
|
The
exercise price of all employee stock options is to be equal to the
closing
price of the Company's common stock, as reported by The Nasdaq Stock
Market, on the date of grant by the Compensation Committee or Board
of
Directors.
|
● |
manufacture
our product candidates;
|
● |
assist
us in developing, testing and obtaining regulatory approval for and
commercializing some of our compounds and technologies;
and
|
● |
market
and distribute our drug products.
|
● |
perceptions
by members of the health care community, including physicians, of
the
safety and efficacy of our product
candidates;
|
● |
the
rates of adoption of our products by medical practitioners and the
target
populations for our products;
|
● |
the
potential advantages that our products offer over existing treatment
methods;
|
● |
the
cost-effectiveness of our products relative to competing
products;
|
● |
the
availability of government or third-party payor reimbursement for
our
products;
|
● |
the
side effects or unfavorable publicity concerning our products or
similar
products; and
|
● |
the
effectiveness of our sales, marketing and distribution efforts.
|
● |
difficulty
and expense of assimilating the operations, technology and personnel
of
the acquired business;
|
● |
our
inability to retain the management, key personnel and other employees
of
the acquired business;
|
● |
our
inability to maintain the acquired company's relationship with key
third
parties, such as alliance partners;
|
● |
exposure
to legal claims for activities of the acquired business prior to
the
acquisition;
|
● |
the
diversion of our management's attention from our core business;
and
|
● |
the
potential impairment of goodwill and write-off of in-process research
and
development costs, adversely affecting our reported results of
operations.
|
● |
government
and health administration authorities;
|
● |
private
health insurers;
|
● |
managed
care programs; and
|
● |
other
third-party payors.
|
● |
decreased
demand for a product;
|
● |
injury
to our reputation;
|
● |
our
inability to continue to develop a drug candidate;
|
● |
withdrawal
of clinical trial volunteers; and
|
● |
loss
of revenues.
|
● |
the
timing of expenses associated with manufacturing and product development
of the proprietary drug candidates within our portfolio and those
that may
be in-licensed, partnered or
acquired;
|
● |
the
timing of the in-licensing, partnering and acquisition of new product
opportunities;
|
● |
the
progress of the development efforts of parties with whom we have
entered,
or may enter, into research and development
agreements;
|
● |
our
ability to achieve our milestones under our licensing arrangements;
and
|
● |
the
costs involved in prosecuting and enforcing patent claims and other
intellectual property rights.
|
●
|
the
progress of our development activities;
|
● |
the
progress of our research activities;
|
● |
the
number and scope of our development programs;
|
● |
the
costs associated with commercialization activities, including
manufacturing, marketing and sales;
|
● |
our
ability to establish and maintain current and new licensing or acquisition
arrangements;
|
● |
our
ability to achieve our milestones under our licensing
arrangements;
|
● |
the
costs involved in enforcing patent claims and other intellectual
property
rights; and
|
● |
the
costs and timing of regulatory approvals.
|
● |
developments
concerning our drug candidates;
|
● |
announcements
of technological innovations by us or our competitors;
|
● |
introductions
or announcements of new products by us or our
competitors;
|
● |
announcements
by us of significant acquisitions, strategic partnerships, joint
ventures
or capital commitments;
|
● |
changes
in financial estimates by securities analysts;
|
● |
actual
or anticipated variations in quarterly operating results;
|
● |
expiration
or termination of licenses, research contracts or other collaboration
agreements;
|
● |
conditions
or trends in the regulatory climate and the biotechnology and
pharmaceutical industries;
|
● |
changes
in the market valuations of similar companies; and
|
● |
additions
or departures of key personnel.
|
Nominee
|
Total
Votes For
|
Total
Votes Withheld
|
Michael
S. Weiss
|
34,204,163
|
2,492,339
|
I.
Craig Henderson, M.D.
|
36,347,670
|
348,832
|
Malcolm
Hoenlein
|
36,652,180
|
44,322
|
Eric
Rose, M.D.
|
36,652,180
|
44,322
|
Lindsay
A. Rosenwald, M.D.
|
36,653,333
|
43,169
|
Jonathan
Spicehandler, M.D.
|
36,651,723
|
44,779
|
Total
Votes For
|
Total
Votes Against
|
Abstention
and Broker Non-Votes
|
36,435,920
|
191,932
|
68,650
|
3.1
|
Amended
and Restated Certificate of Incorporation of Keryx Biopharmaceuticals,
Inc., filed as Exhibit 3.1 to the Registrant's Annual Report on Form
10-Q
for the quarter ended June 30, 2004, filed on August 12, 2004, and
incorporated herein by reference.
|
|
3.2
|
Amended
and Restated Bylaws of Keryx Biopharmaceuticals, Inc., filed as Exhibit
3.2 to the Registrant’s Annual Report on Form 10-K for the year ended
December 31, 2001, filed on March 26, 2002 (File No. 000-30929),
and
incorporated herein by reference.
|
|
10.1
|
Amendment
to the Keryx Biopharmaceuticals, Inc. 2004 Long-Term Incentive Plan
dated
April 11, 2006.
|
|
31.1
|
Certification
of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a),
as
adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002,
dated
August 8, 2006.
|
|
|
|
|
31.2
|
Certification
of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a),
as
adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002,
dated
August 8, 2006.
|
|
|
|
|
32.1
|
Certification
of Chief Executive Officer pursuant to 18 U.S.C. §1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, dated
August 8,
2006.
|
|
|
|
|
32.2
|
Certification
of Chief Financial Officer pursuant to 18 U.S.C. §1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, dated
August 8,
2006.
|
|
|
|
|
KERYX
BIOPHARMACEUTICALS, INC.
|
|
|
|
|
Date:
August 8, 2006
|
By:
|
/s/
Ronald C. Renaud, Jr
|
|
Senior
Vice President, Chief Financial Officer, Secretary and
Treasurer
|
|
|
(Principal
Financial and Accounting Officer)
|
10.1
|
Amendment
to the Keryx Biopharmaceuticals, Inc. 2004 Long-Term Incentive Plan
dated
April 11, 2006.
|
|
31.1
|
Certification
of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a),
as
adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002,
dated
August 8, 2006.
|
|
|
|
|
31.2
|
Certification
of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a),
as
adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002,
dated
August 8, 2006.
|
|
|
|
|
32.1
|
Certification
of Chief Executive Officer pursuant to 18 U.S.C. §1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, dated
August 8,
2006.
|
|
32.2
|
Certification
of Chief Financial Officer pursuant to 18 U.S.C. §1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, dated
August 8,
2006.
|