Registration No. 333-
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Bioenvision, Inc.
(Exact name of registrant as specified in its charter)
Delaware 13-4025857
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(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
509 Madison Avenue
Suite 404
New York, New York 10022
(212) 750-6700
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
David P. Luci, Esq.
Chief Financial Officer and General Counsel
Bioenvision, Inc.
509 Madison Avenue
Suite 404
New York, New York 10022
(212) 750-6700
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copy to:
Luke P. Iovine, III, Esq.
Paul, Hastings, Janofsky & Walker LLP
75 East 55th Street
New York, NY 10022
(212) 318-6000
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 being 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, other than securities offered only in connection with dividend or interest
reinvestment plans, 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, 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(d) under
the Securities Act, check the following box and list the Securities Act
registration number of the earlier 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. |_|
Calculation of Registration Fee
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Title of each class of securities to Proposed maximum
be registered aggregate offering Amount of
price registration fee(1)
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Common Stock, par value $.001 per share (2) $90,000,000(3) $11,403
(1) The aggregate amount to be registered and the aggregate offering price per
unit have been omitted pursuant to Securities Act Release No. 6964. The
registration fee has been calculated on the basis of the maximum offering
price of all securities listed in accordance with Rule 457(o) under the
Securities Act of 1933.
(2) An indeterminate number of shares of common stock of the registrant as may
be sold from time to time by the registrant.
(3) In no event will the aggregate offering price of all securities issued from
time to time pursuant to this prospectus exceed $90,000,000.
The registrant hereby amends this registration statement on such date or dates
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 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. We may
not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and we are not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
Prospectus Subject to completion, October 25, 2004
[BIOENVISION LOGO]
Bioenvision, Inc.
$90,000,000
Common Stock
From time to time, we may sell our common stock, par value $.001 per share
(the "Common Stock"), in one or more offerings. The specific terms and number of
shares of Common Stock so offered will be fully described in supplements to this
prospectus. Please read any prospectus supplements and this prospectus carefully
before you invest. This prospectus may not be used to sell shares of Common
Stock unless accompanied by a prospectus supplement.
Our Common Stock is included for quotation on the Nasdaq National Market
under the symbol "BIVN". The last reported sales price of shares of our common
stock on October 22, 2004 was $7.33 per share.
We urge you to read carefully the "Risk Factors" section beginning on page
3 where we describe specific risks associated with an investment in our Common
Stock before you make your investment decision.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this prospectus. Any representation to the contrary is a
criminal offense.
The shares of Common Stock may be sold directly by us to investors, through
agents designated from time to time or to or through underwriters or dealers.
See "Plan of Distribution". If any underwriters are involved in the sale of any
shares of Common Stock in respect of which this prospectus is being delivered,
the names of such underwriters and any applicable commissions or discounts will
be set forth in a prospectus supplement. The net proceeds we expect to receive
from such sale also will be set forth in a prospectus supplement.
The date of this prospectus is October ___, 2004.
TABLE OF CONTENTS
Page
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ABOUT THIS PROSPECTUS.................................................. 1
BIOENVISION, INC....................................................... 1
RISK FACTORS........................................................... 3
FORWARD-LOOKING STATEMENTS............................................. 12
USE OF PROCEEDS........................................................ 13
DESCRIPTION OF CAPITAL STOCK........................................... 13
PLAN OF DISTRIBUTION................................................... 14
LEGAL MATTERS.......................................................... 16
EXPERTS................................................................ 16
WHERE YOU CAN FIND MORE INFORMATION.................................... 16
INCORPORATION BY REFERENCE............................................. 17
DISCLOSURE OF COMMISSION POSITION ON
INDEMNIFICATION FOR SECURITIES ACT LIABILITIES......................... 17
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ABOUT THIS PROSPECTUS
This prospectus is part of a Registration Statement on Form S-3 that we
filed with the Securities and Exchange Commission utilizing a "shelf"
registration process. Under this shelf process, we may from time to time offer
Common Stock described in this prospectus in one or more offerings up to a total
dollar amount of $90,000,000. Each time we use this prospectus to offer shares
of Common Stock, we will provide a prospectus supplement that will contain
specific information about the terms of that offering. The prospectus supplement
may also add, update or change information contained in this prospectus. You
should read both this prospectus and any prospectus supplement together with
additional information described below under the heading "Where You Can Find
More Information".
In this prospectus, "Bioenvision", "we", "us, and "our" and "the
Company" refer to Bioenvision, Inc.
BIOENVISION, INC.
You should read the following summary together with the more detailed
information, including the consolidated financial statements and the notes
thereto and other information, included, or incorporated by reference, in this
prospectus.
We are an emerging biopharmaceutical company that develops and markets
drugs to treat cancer. Our two lead drugs are clofarabine and Modrenal(R),
although we have several other products and technologies under development. As
of October 11, 2004, our internal staff consisted of nine full-time and four
part-time employees based in New York, New York and Edinburgh, Scotland.
Clofarabine is a small molecule, purine nucleoside analogue, which we
believe is effective in the treatment of leukemia, based upon our own clinical
studies and studies conducted by others on our behalf. Clofarabine may also be
an effective agent to treat patients with solid tumors, based on preclinical
studies and Phase I clinical trials performed to date.
Modrenal(R) is a hormonal agent with a novel mode of action that makes
it an effective agent in patients with advanced breast cancer who have acquired
resistance to other hormonal agents. We launched Modrenal(R) in May 2003 in the
United Kingdom, where we have received regulatory approval for its use in the
treatment of post-menopausal breast cancer. In the second quarter of 2005, we
intend to apply for mutual recognition in another four large European
territories in an effort to gain approval for Modrenal(R) in each such
territory. We anticipate receiving approval in each such territory during
calendar 2005, but such approval is subject to the appropriate regulatory
decisions.
Our primary business strategy relates to our two lead drugs,
clofarabine and Modrenal(R). With clofarabine, our strategy is to complete drug
development in Europe and obtain marketing authorization from the European
regulatory authorities to market and distribute clofarabine in Europe for the
treatment of pediatric and adult acute leukemias (ALL and AML). We anticipate
launching clofarabine in Europe in mid-2005, subject to our obtaining from the
European regulatory authorities the first approval for clofarabine which is
expected to be for pediatric acute leukemias. We intend to continue clinical
trials in other indications with the intention of aggressively seeking label
extensions after clofarabine's first approval, including our Pivotal Phase II
trial of clofarabine in adults with Acute Myeloid Leukemia (AML) which commenced
in August 2004 and is ongoing. Following this strategy, throughout the world,
approximately two-thirds of the cancer patients dosed with clofarabine to date
fall outside of the pediatric acute leukemias.
In July 2004, we filed for approval of clofarabine in Europe to treat
children with pediatric acute leukemia (ALL and AML). Further, we are conducting
a Pivotal Phase II clinical trial of clofarabine, as first line therapy for the
treatment of adults with Acute Myeloid Leukemia (AML). Also in Europe, at our
direction, an Investigator Sponsored Trial of clofarabine as first-line therapy
for adults with AML was completed ahead of schedule and an interim analysis
indicates a 64% complete response rate observed in this patient population. In
January, 2002, the European orphan drug application for use of clofarabine to
treat acute leukemia in adults was approved. Orphan Drug Designation provides
the Company with ten years of market exclusivity in Europe for clofarabine, upon
grant of marketing authorization. The drug has also been granted orphan drug
status and "fast track" treatment by the FDA. Further, in July 2004, the FDA
granted six months of extended market exclusivity to clofarabine under the Best
Pharmaceuticals for Children Act.
In the U.S., ILEX Oncology, Inc., our sub-licensor of U.S. and Canadian
cancer marketing rights, filed a New Drug Application ("NDA") in March 2004 for
approval of clofarabine to treat children with acute leukemias (ALL or AML). The
NDA was based upon results of two Pivotal Phase II clinical trials completed by
ILEX prior to the NDA filing. In connection with the NDA, the United States Food
and Drug Administration (the "FDA") has set a Prescription Drug User Fee Act
("PDUFA") response date at December 30, 2004. A PDUFA date is the is the date by
which the FDA is expected to review and act upon an NDA submission. Clofarabine
will be reviewed by the FDA Oncologic Drug Advisory Committee ("ODAC") on
December 1, 2004.
In August 2003, we obtained the exclusive, irrevocable option to sell,
market and distribute clofarabine in Japan and
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Southeast Asia from the inventor of clofarabine. These rights were not
previously granted by Southern Research Institute and fall outside the scope of
our then current licensing and development contracts with respect to
clofarabine. We originally obtained an exclusive license from Southern Research
Institute to sell, market and distribute clofarabine throughout the world,
except for Japan and Southeast Asia, for all human applications, pursuant to a
co-development agreement, dated August 31, 1998, between the Company and
Southern Research Institute. On March 12, 2001, we granted an exclusive option
to sell, market and distribute clofarabine in the U.S. and Canada to ILEX
Oncology, Inc. We converted ILEX's option to an exclusive sublicense on December
30, 2003. Accordingly, we do not possess the rights to sell, market and
distribute clofarabine for cancer indications in the U.S.
With Modrenal(R), our strategy is to expand sales in the United Kingdom
and apply for mutual recognition to obtain the right to market and distribute
Modrenal(R) in the major European markets. We anticipate receiving mutual
recognition from major European Community member states by the third quarter of
calendar 2005. We intend to further U.S. development of Modrenal(R) in prostate
and breast cancer indications, subject to the ongoing results of our clinical
trials we are currently conducting in the U.S. and Europe.
In the U.S., we filed an IND to conduct Modrenal(R) clinical trials for
prostate cancer in February 2004 and commenced enrolling patients in this
clinical trial in July 2004. Further, we intend to seek regulatory approval for
Modrenal(R) in the United States as salvage therapy for hormone-sensitive breast
cancer upon completion of additional clinical studies. We originally obtained an
exclusive license from Stegram Pharmaceuticals Ltd. to sell, market and
distribute Modrenal(R) throughout the world, except for South Africa, for all
human and animal health applications, pursuant to a co-development agreement
dated July 15, 1998.
Our secondary business strategy is to continue to develop our portfolio
of ancillary products and technologies. We anticipate that revenues derived from
clofarabine and Modrenal(R) and milestone payments and royalties from the
ancillary products will permit us to further develop our portfolio of ancillary
products and technologies.
We were incorporated as Express Finance, Inc. under the laws of the
State of Delaware on August 16, 1996, and changed our name to Ascot Group, Inc.
in August 1998 and further to Bioenvision, Inc. in December 1998. Our principal
executive offices are located at 509 Madison Avenue, Suite 404 , New York, New
York 10022. Our telephone number is (212) 750-6700 and our fax number is (212)
750-6777. Our website is www.bioenvision.com. Information contained on our
website does not constitute, and shall not be deemed to constitute, part of this
prospectus.
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RISK FACTORS
You should carefully consider the following risks before you decide to
buy our Common Stock. All known risks are presented in this prospectus. These
risks may adversely affect our business, financial condition or operating
results. If any of the events we have identified occur, the trading price of our
Common Stock could decline, and you may lose all or part of the money you paid
to buy our Common Stock.
We have a limited operating history, which makes it difficult to evaluate our
business and to predict our future operating results
Since our inception, August of 1996, we have been primarily engaged in
organizational activities, including developing a strategic operating plan,
entering into various collaborative agreements for the development of products
and technologies, hiring personnel and developing and testing our products. We
have not generated any material revenues to date. Accordingly, we have no
relevant operating history upon which an evaluation of our performance and
prospects can be made.
We have incurred net losses since commencing business and expect future losses
To date, we have incurred significant net losses, including net losses
of approximately $11,574,000 for the fiscal year ended June 30, 2004. At June
30, 2004, we had an accumulated deficit of approximately $41,082,000. We
anticipate that we may continue to incur significant operating losses for the
foreseeable future. We may never generate material revenues or achieve
profitability and, if we do achieve profitability, we may not be able to
maintain profitability.
Clinical trials for our products will be expensive and may be time consuming,
and their outcome is uncertain, but we must incur substantial expenses that may
not result in any viable products
Before obtaining regulatory approval for the commercial sale of a
product, we must demonstrate through pre-clinical testing and clinical trials
that a product candidate is safe and effective for use in humans. Conducting
clinical trials is a lengthy, time-consuming and expensive process. We will
incur substantial expense for, and devote a significant amount of time to
pre-clinical testing and clinical trials. Even with Modrenal(R), which is
approved and marketed by us in the U.K. for the treatment of advanced,
post-menopausal breast cancer, we are conducting a Phase II Clinical Trial in
the U.S. in prostate cancer and a Phase II Clinical Trial in the U.K. for the
treatment of pre-menopausal breast cancer, each of which is a new potential
indication for this approved drug.
Historically, the results from pre-clinical testing and early clinical
trials have often not been predictive of results obtained in later clinical
trials. A number of new drugs have shown promising results in clinical trials,
but subsequently failed to establish sufficient safety and efficacy data to
obtain necessary regulatory approvals. Data obtained from pre-clinical and
clinical activities are susceptible to varying interpretations, which may delay,
limit or prevent regulatory approval. Regulatory delays or rejections may be
encountered as a result of many factors, including changes in regulatory policy
during the period of product development. Regulatory authorities may require
additional clinical trials, which could result in increased costs and
significant development delays. Clofarabine currently is at a pivotal stage of
its development, but many of our other products and technologies are at various
less mature stages of development including l-gossypol for which we have just
commenced a Phase I clinical trial in the U.K. and gene therapy which is
currently in pre-clinical and phase I clinical testing.
Completion of clinical trials for any product may take several years or
more. The length of time generally varies substantially according to the type,
complexity, novelty and intended use of the product candidate. Our commencement
and rate of completion of clinical trials may be delayed by many factors,
including:
o inability of vendors to manufacture sufficient quantities of
materials for use in clinical trials;
o slower than expected rate of patient recruitment or
variability in the number and types of patients in a study;
o inability to adequately follow patients after treatment;
o unforeseen safety issues or side effects;
o lack of efficacy during the clinical trials; or
o government or regulatory delays.
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Our intangible assets constitute a significant portion of our assets and relate
to ancillary products which may not be successfully commercialized
Our ancillary products include OLIGON and Methylene Blue which are
anti-microbial agents that we acquired in February 2002. As of June 30, 2004,
our intangible assets associated with these products amounted to approximately
$14.6 million and constituted approximately 33% of our total assets and
approximately 53% of our stockholders' equity. We amortize approximately $1.3
million of this amount each year for the estimated useful life of these products
of approximately 13 years.
We do not currently devote any significant time or resources to the
research and development of OLIGON and Methylene Blue and only intend to do so
if and to the extent we successfully commercialize our lead drugs, clofarabine
and Modrenal(R), over the next two years. If at any time in the future
management determines that the carrying amount of these assets is not
recoverable, we would need to write down the value of these assets. Based on the
estimated useful life of these assets of approximately 13 years and market
considerations, no assurance can be given that there will not be an impairment
of these assets in the future. Any impairment of these assets could result in a
material impact on our future results of operations.
If our development agreement with ILEX does not proceed as planned we may incur
delay in the commercialization of clofarabine, which would delay our ability to
generate sales and cash flow from the sale of clofarabine
ILEX, and any third party to which ILEX may grant a sublicense or in
any way transfer its obligations, has primary responsibility for conducting
clinical trials and administering regulatory compliance and approval matters in
the United States and Canada pursuant to the terms of our co-development
agreement with ILEX. While there are target dates for completion, that agreement
allows ILEX time to continue working beyond those dates under certain
circumstances. For example, under the co-development agreement, ILEX was
required to complete Pivotal Phase II Trials not later than December 31, 2002,
but ILEX failed to do so. In this situation the co-development agreement
provides that the milestone shall be adjusted such that ILEX receives more time
to complete the pivotal trials if the trials are ongoing at December 31, 2002
and progressing to completion within a reasonable time thereafter. Further, ILEX
was required under the co-development agreement to have filed a New Drug
Application by August 31, 2003, subject to extension if ILEX continues to use
its reasonable efforts to promptly complete the filing after August 31, 2003.
ILEX continued to use its reasonable efforts to complete the filing after August
31, 2003 and in October 2003, Ilex filed the first part of a "rolling NDA" with
the FDA.
If ILEX fails to meet its obligations under the co-development
agreement, we could lose valuable time in developing clofarabine for
commercialization both in the U.S. and in Europe. We can not provide assurance
that ILEX will not fail to meet its obligations under the co-development
agreement. Development of compounds to the stage of approval includes inherent
risk at each stage of development that FDA, in its discretion, will mandate a
requirement not foreseeable by us or by ILEX. There would also be testing delays
if, for example, our sources of drug supply could not produce enough clofarabine
to support the then ongoing clinical trials being conducted. If this were to
occur, it could have a material adverse effect on our ability to develop
clofarabine, obtain necessary regulatory approvals, and generate sales and cash
flow from the sale of clofarabine.
If delays in completion constitute a breach by ILEX or there are
certain other breaches of the co-development agreement by ILEX, then, at our
discretion, the primary responsibility for completion would revert to us, but
there is no assurance that we would have the financial, managerial or technical
resources to complete such tasks in timely fashion or at all.
We have limited experience in developing products and may be unsuccessful in our
efforts to develop products
To achieve profitable operations, we, alone or with others, must
successfully develop, clinically test, market and sell our products. We are
developing clofarabine with ILEX Oncology, our U.S. co-development partner, but
on February 26, 2004, Genzyme announced a merger pursuant to which Genzyme
intends to acquire ILEX in a merger transaction. If this transaction is
consummated, no assurance can be given that the operational and managerial
relations with Genzyme will proceed favorably or that the timeline for
development of clofarabine will not be elongated. If the U.S. regulatory
timeline is elongated, this could materially and adversely affect the European
regulatory timeline for the approval of clofarabine.
With respect to our co-lead drug, Modrenal(R), we currently have an
Investigational New Drug Application filed with FDA to conduct a Phase II
Clinical Trial in the U.S. to determine efficacy of Modrenal(R) in prostate
cancer patients. This Phase II Clinical Trial is being conducted at the Mass
General Hospital in Boston, MA. To our knowledge, Modrenal(R) has not been
tested in this indication in the past and there can be no assurance that
Modrenal(R) will be an effective therapy in prostate cancer. Further, our
long-term drug development objectives for Modrenal(R) include attempting to test
the drug and get approval in the U.S. for treatment of advanced post-menopausal
breast cancer patients. These trials will take significant time and resource and
no assurance can be given that developing the drug in this indication will
result in a U.S. approval for Modrenal(R) in advanced post-menopausal breast
cancer patients.
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Generally, most products resulting from our or our collaborative
partners' product development efforts are not expected to be available for sale
for at least several years, if at all. Potential products that appear to be
promising at early stages of development may not reach the market for a number
of reasons, including:
o discovery during pre-clinical testing or clinical trials that the
products are ineffective or cause harmful side effects;
o failure to receive necessary regulatory approvals;
o inability to manufacture on a large or economically feasible scale;
o failure to achieve market acceptance; or
o preclusion from commercialization by proprietary rights of third
parties.
Most of the existing and future products and technologies developed by
us will require extensive additional development, including pre-clinical testing
and clinical trials, as well as regulatory approvals, prior to
commercialization. Our product development efforts may not be successful. We may
fail to receive required regulatory approvals from U.S. or foreign authorities
for any indication. Any products, if introduced, may not be capable of being
produced in commercial quantities at reasonable costs or being successfully
marketed. The failure of our research and development activities to result in
any commercially viable products or technologies would materially adversely
affect our future prospects.
Our industry is subject to extensive government regulation and our products
require other regulatory approvals which makes it more expensive to operate our
business
Regulation in General. Virtually all aspects of our business are
regulated by federal and state statutes and governmental agencies in the United
States and other countries. Failure to comply with applicable statutes and
government regulations could have a material adverse effect on our ability to
develop and sell products which would have a negative impact on our cash flow.
The development, testing, manufacturing, processing, quality, safety, efficacy,
packaging, labeling, record-keeping, distribution, storage and advertising of
pharmaceutical products, and disposal of waste products arising from these
activities, are subject to regulation by one or more federal agencies. These
activities are also regulated by similar state and local agencies and equivalent
foreign authorities. In our material contracts with vendors providing any
portion of these types of services, we seek assurances that our vendors comply
and will continue to maintain compliance with all applicable rules and
regulations. This is the case, for example, with respect to our contracts with
Ferro Pfanstiehl and Penn Pharmaceuticals. No assurance can be given that our
most significant vendors will continue to comply with these rules and
regulations.
FDA Regulation. All pharmaceutical manufacturers in the United States
are subject to regulation by the FDA under the authority of the Federal Food,
Drug, and Cosmetic Act. Under the Act, the federal government has extensive
administrative and judicial enforcement powers over the activities of
pharmaceutical manufacturers to ensure compliance with FDA regulations. Those
powers include, but are not limited to the authority to:
o initiate court action to seize unapproved or non-complying products;
o enjoin non-complying activities;
o halt manufacturing operations that are not in compliance with current
good manufacturing practices prescribed by the FDA;
o recall products which present a health risk; and
o seek civil monetary and criminal penalties.
Other enforcement activities include refusal to approve product
applications or the withdrawal of previously approved applications. Any
enforcement activities, including the restriction or prohibition on sales of
products marketed by us or the halting of manufacturing operations of us or our
collaborators, would have a material adverse effect on our ability to develop
and sell products which would have a negative impact on our cash flow. In
addition, product recalls may be issued at our discretion or by the FDA or other
domestic and foreign government agencies having regulatory authority for
pharmaceutical product sales. Recalls may occur due to disputed labeling claims,
manufacturing issues, quality defects or other reasons. Recalls of
pharmaceutical products marketed by us may occur in the future. Any product
recall could have a material adverse effect on our revenue and cash flow.
FDA Approval Process. We have a variety of products under development,
including line extensions of existing products, reformulations of existing
products and new products. All "new drugs" must be the subject of an
FDA-approved new drug application before they may be marketed in the United
States. All generic equivalents to previously approved drugs or new dosage forms
of existing drugs must be the subject of an FDA-approved abbreviated new drug
application before they may by marketed in the United States. In both cases, the
FDA has the authority to determine what testing procedures are appropriate for a
particular product and, in
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some instances, has not published or otherwise identified guidelines as to the
appropriate procedures. The FDA has the authority to withdraw existing new drug
application and abbreviated application approvals and to review the regulatory
status of products marketed under the enforcement policy. The FDA may require an
approved new drug application or abbreviated application for any drug product
marketed under the enforcement policy if new information reveals questions about
the drug's safety or effectiveness. All drugs must be manufactured in conformity
with current good manufacturing practices and drugs subject to an approved new
drug application or abbreviated application must be manufactured, processed,
packaged, held and labeled in accordance with information contained in the new
drug application or abbreviated application.
The required product testing and approval process can take a number of
years and require the expenditure of substantial resources. Testing of any
product under development may not result in a commercially-viable product.
Further, we may decide to modify a product in testing, which could materially
extend the test period and increase the development costs of the product in
question. Even after time and expenses, regulatory approval by the FDA may not
be obtained for any products we develop. In addition, delays or rejections may
be encountered based upon changes in FDA policy during the period of product
development and FDA review. Any regulatory approval may impose limitations in
the indicated use for the product. Even if regulatory approval is obtained, a
marketed product, its manufacturer and its manufacturing facilities are subject
to continual review and periodic inspections. Subsequent discovery of previously
unknown problems with a product, manufacturer or facility may result in
restrictions on the product or manufacturer, including withdrawal of the product
from the market.
Foreign Regulatory Approval. Even if required FDA approval has been
obtained with respect to a product, foreign regulatory approval of a product
must also be obtained prior to marketing the product internationally. Foreign
approval procedures vary from country to country and the time required for
approval may delay or prevent marketing. In certain instances, we or our
collaborative partners may seek approval to market and sell some of our products
outside of the United States before submitting an application for approval to
the FDA. The clinical testing requirements and the time required to obtain
foreign regulatory approvals may differ from that required for FDA approval.
Although there is now a centralized European Union approval mechanism for new
pharmaceutical products in place, each European Union country may nonetheless
impose its own procedures and requirements, many of which are time consuming and
expensive, and some European Union countries require price approval as part of
the regulatory process. Thus, there can be substantial delays in obtaining
required approval from both the FDA and foreign regulatory authorities after the
relevant applications are filed.
Changes in Requirements. The regulatory requirements applicable to any
product may be modified in the future. We cannot determine what effect changes
in regulations or statutes or legal interpretations may have on our business in
the future. Changes could require changes to manufacturing methods, expanded or
different labeling, the recall, replacement or discontinuation of certain
products, additional record keeping and expanded documentation of the properties
of certain products and scientific substantiation. Any changes or new
legislation could have a material adverse effect on our ability to develop and
sell products and, therefore, generate revenue and cash flow.
The products under development by us may not meet all of the applicable
regulatory requirements needed to receive regulatory marketing approval. Even
after we expend substantial resources on research, clinical development and the
preparation and processing of regulatory applications, we may not be able to
obtain regulatory approval for any of our products. Moreover, regulatory
approval for marketing a proposed pharmaceutical product in any jurisdiction may
not result in similar approval in other jurisdictions. Our failure to obtain and
maintain regulatory approvals for products under development would have a
material adverse effect on our ability to develop and sell products and,
therefore, generate revenue and cash flow.
We may not be successful in receiving orphan drug status for certain of our
products or, if that status is obtained, fully enjoying the benefits of orphan
drug status
Under the Orphan Drug Act, the FDA may grant orphan drug designation to
drugs intended to treat a rare disease or condition. A disease or condition that
affects populations of fewer than 200,000 people in the United States generally
constitutes a rare disease or condition. We may not be successful in receiving
orphan drug status for certain of our products. Orphan drug designation must be
requested before submitting a new drug application. After the FDA grants orphan
drug designation, the generic identity of the therapeutic agent and its
potential orphan use are publicized by the FDA. Under current law, orphan drug
status is conferred upon the first company to receive FDA approval to market the
designated drug for the designated indication. Orphan drug status also grants
marketing exclusivity in the United States for a period of seven years following
approval of the new drug application, subject to limitations. Orphan drug
designation does not provide any advantage in, or shorten the duration of, the
FDA regulatory approval process. Although obtaining FDA approval to market a
product with orphan drug status can be advantageous, the scope of protection or
the level of marketing exclusivity that is currently afforded by orphan drug
status and marketing approval may not remain in effect in the future.
-6-
Our business strategy involves obtaining orphan drug designation for
certain of the oncology products we have under development. Although clofarabine
has received orphan drug designation with the FDA and EMEA, we do not know
whether any of our other products will receive an orphan drug designation.
Orphan drug designation does not prevent other manufacturers from attempting to
develop similar drugs for the designated indication or from obtaining the
approval of a new drug application for their drug prior to the approval of our
new drug application. If another sponsor's new drug application for a competing
drug in the same indication is approved first, that sponsor is entitled to
exclusive marketing rights if that sponsor has received orphan drug designation
for its drug. In that case, the FDA would refrain from approving an application
by us to market our competing product for seven years, subject to limitations.
Competing products may receive orphan drug designations and FDA marketing
approval before the products under development by us.
New drug application approval for a drug with an orphan drug
designation does not prevent the FDA from approving the same drug for a
different indication, or a molecular variation of the same drug for the same
indication. Because doctors are not restricted by the FDA from prescribing an
approved drug for uses not approved by the FDA, it is also possible that another
company's drug could be prescribed for indications for which products developed
by us have received orphan drug designation and new drug application approval
and the same is true with the EMEA in Europe. Prescribing of approved drugs for
unapproved uses, commonly referred to as "off label" sales, could adversely
affect the marketing potential of products that have received an orphan drug
designation and new drug application approval. In addition, new drug application
approval of a drug with an orphan drug designation does not provide any
marketing exclusivity in foreign markets.
The possible amendment of the Orphan Drug Act by the United States
Congress has been the subject of frequent discussion. Although no significant
changes to the Orphan Drug Act have been made for a number of years, members of
Congress have from time to time proposed legislation that would limit the
application of the Orphan Drug Act. The precise scope of protection that may be
afforded by orphan drug designation and marketing approval may be subject to
change in the future.
The use of our products may be limited or eliminated by professional guidelines
which would decrease our sales of these products and, therefore, our revenue and
cash flows.
In addition to government agencies, private health/science foundations
and organizations involved in various diseases may also publish guidelines or
recommendations to the healthcare and patient communities. These private
organizations may make recommendations that affect the usage of therapies, drugs
or procedures, including products developed by us. These recommendations may
relate to matters such as usage, dosage, route of administration and use of
concomitant therapies. Recommendations or guidelines that are followed by
patients and healthcare providers and that result in, among other things,
decreased use or elimination of products developed by us could have a material
adverse effect on our revenue and cash flows. For example, if clofarabine is
definitively determined in clinical trials to be an active agent to treat solid
tumor cancer patients, but the required dose is high, private healthcare/science
foundations could recommend various other regimens of treatment which may from
time to time show activity at lower doses.
Generic products which third parties may develop may render our products
noncompetitive or obsolete
An increase in competition from generic pharmaceutical products could
have a material adverse effect on our ability to generate revenue and cash flow.
For example, many of the indications in which clofarabine and Modrenal(R), our
co-lead drugs, have demonstrated activity are areas of unmet clinical need, such
as clofarabine's application to pediatric acute leukemias in which, initially,
the drug will be used as a salvage therapy, after other regimens of treatment
have failed. Our lead investigators, who have assisted with the development of
Modrenal(R), envision, initially, that Modrenal(R) would be used as second or
third line therapy, only after patients with advanced post-menopausal breast
cancer receive regimens of tamoxifen and/or aromatase inhibitors (or similar
drug) treatments. If generic drug companies develop a compound which is more
effective than either clofarabine or Modrenal(R) in these areas of unmet
clinical need, or equally as effective but at lower doses, it could adversely
affect our market and/or render our drugs obsolete.
Because many of our competitors have substantially greater capabilities and
resources, they may be able to develop products before us or develop more
effective products or market them more effectively which would limit our ability
to generate revenue and cash flow
Competition in our industry is intense. Potential competitors in the
United States and Europe are numerous and include pharmaceutical, chemical and
biotechnology companies, most of which have substantially greater capital
resources, marketing experience, research and development staffs and facilities
than us. Potential competitors for certain indications of our lead drugs
include, with respect to clofarabine, Schering AG, which markets fludarabine,
and certain generic drug companies in Europe which could market fludarabine upon
expiry of the patent protections held by Schering. Potential competitors with
respect to Modrenal(R) include Astra-zeneca and Novartis, which market tamoxifen
and other aromatase inhibitors, which could be used by clinicians as first and
second line therapies in patients with hormone sensitive, advanced,
post-menopausal breast cancer prior to a Modrenal(R) regimen
-7-
of treatment. No assurance can be given that the ongoing business activities of
our competitors will not have a material adverse effect on our business
prospects and projections going forward.
Although we seek to limit potential sources of competition by
developing products that are eligible for orphan drug designation and new drug
application approval or other forms of protection, our competitors may develop
similar technologies and products more rapidly than us or market them more
effectively. Competing technologies and products may be more effective than any
of those that are being or will be developed by us. The generic drug industry is
intensely competitive and includes large brand name and multi-source
pharmaceutical companies. Because generic drugs do not have patent protection or
any other market exclusivity, our competitors may introduce competing generic
products, which may be sold at lower prices or with more aggressive marketing.
Conversely, as we introduce branded drugs into our product portfolio, we will
face competition from manufacturers of generic drugs which may claim to offer
equivalent therapeutic benefits at a lower price. The aggressive pricing
activities of our generic competitors could have a material adverse effect on
our operations, revenue and cash flow.
If we fail to keep up with rapid technological change and evolving therapies,
our technologies and products could become less competitive or obsolete
The pharmaceutical industry is characterized by rapid and significant
technological change. We expect that pharmaceutical technology will continue to
develop rapidly, and our future success will depend on our ability to develop
and maintain a competitive position. Technological development by others may
result in products developed by us, branded or generic, becoming obsolete before
they are marketed or before we recover a significant portion of the development
and commercialization expenses incurred with respect to these products.
Alternative therapies or new medical treatments could alter existing treatment
regimes, and thereby reduce the need for one or more of the products developed
by us, which would adversely affect our revenue and cash flow. See also
"--Generic products which third parties may develop may render our products
noncompetitive or obsolete" above.
We depend on others for clinical testing of our products which could delay our
ability to develop products
We do not currently have any internal product testing capabilities. Our
inability to retain third parties for the clinical testing of products on
acceptable terms would adversely affect our ability to develop products. Any
failures by third parties to adequately perform their responsibilities may delay
the submission of products for regulatory approval, impair our ability to
deliver products on a timely basis or otherwise impair our competitive position.
Our dependence on third parties for the development of products may adversely
affect our potential profit margins and our ability to develop and deliver
products on a timely basis.
We depend on others to manufacture our products and have not manufactured them
in significant quantities
We have never manufactured any products in commercial quantities, and
the products being developed by us may not be suitable for commercial
manufacturing in a cost-effective manner. Manufacturers of products developed by
us will be subject to current good manufacturing practices prescribed by the FDA
or other rules and regulations prescribed by foreign regulatory authorities. We
may not be able to enter into or maintain relationships either domestically or
abroad with manufacturers whose facilities and procedures comply or will
continue to comply with current good manufacturing practices or applicable
foreign requirements. Failure by a manufacturer of our products to comply with
current good manufacturing practices or applicable foreign requirements could
result in significant time delays or our inability to commercialize or continue
to market a product and could have a material adverse effect on our sales of
products and, therefore, our cash flow. In the United States, failure to comply
with current good manufacturing practices or other applicable legal requirements
can lead to federal seizure of violative products, injunctive actions brought by
the federal government, and potential criminal and civil liability on the part
of a company and our officers and employees.
We have limited sales and marketing capability, and may not be successful in
selling or marketing our products
The creation of infrastructure to commercialize oncology products is a
difficult, expensive and time-consuming process. We may not be able to establish
direct or indirect sales and distribution capabilities or be successful in
gaining market acceptance for proprietary products or for other products. We
currently have very limited sales and marketing capabilities. We currently
employ one full-time sales employee and one full-time marketing employee. To
market any products directly, we will need to develop a more fulsome marketing
and sales force with technical expertise and distribution capability or contract
with other pharmaceutical and/or health care companies with distribution systems
and direct sales forces. To the extent that we enter into co-promotion or other
licensing arrangements, any revenues to be received by us will be dependent on
the efforts of third parties. The efforts of third parties may not be
successful. Our failure to establish marketing and distribution capabilities or
to enter into marketing and distribution arrangements with third parties could
have a material adverse effect on our revenue and cash flows.
If we lose key management our business will suffer
-8-
We are highly dependent on our Chief Executive Officer to develop our
lead drug. Dr. Wood has an employment agreement with the Company, dated December
31, 2002, for an initial term of one year which automatically extends for an
additional one year periods until either party gives the other written notice of
termination at least 90 days prior to the end of the current term. Dr. Wood is
not near retirement age and he does not, to our knowledge, plan on leaving the
Company in the near future. Dr. Wood is one of the founders of the company and
he is intimately familiar with the science that underlies our lead drugs and
ancillary technologies. He also maintains a position on the clofarabine
management team that is responsible for all drug development activities relating
to that lead drug, and has been instrumental in the development and maintenance
of our key relationships within the scientific research and medical communities,
and those with our vendors, inventors, co-development partners and licensors. If
Dr. Wood was no longer employed by the company, the development of our drugs
would be significantly delayed and otherwise would be adversely impacted, and we
may be unable to maintain and develop these important relationships.
Need for additional personnel
The Company will be required to hire additional qualified scientific
and technical personnel, as well as personnel with expertise in clinical testing
and government regulation to expand our research and development programs and
pursue our product development and marketing plans. There is intense competition
for qualified personnel in the areas of the Company's activities, and there can
be no assurance that the Company will be able to attract and retain the
qualified personnel necessary for the development of its business. The Company
faces competition for qualified individuals from numerous pharmaceutical and
biotechnology companies, universities and research institutions. The failure to
attract and retain key scientific, marketing and technical personnel would have
a material adverse effect on the development of the Company's business and our
ability to develop, market and sell our products. See also "- We have limited
sales and marketing capability, and may not be successful in selling or
marketing our products" above.
Our management and internal systems might be inadequate to handle our potential
growth
Our success will depend in significant part on the expansion of our
operations and the effective management of growth. This growth has and will
continue to place a significant strain on our management and information systems
and resources and operational and financial systems and resources. To manage
future growth, our management must continue to improve our operational and
financial systems and expand, train, retain and manage our employee base. Our
management may not be able to manage our growth effectively. If our systems,
procedures, controls, and resources are inadequate to support our operations,
our expansion would be halted or delayed and we could lose our opportunity to
gain significant market share or the timing with which we would otherwise gain
significant market share. Any inability to manage growth effectively may harm
our ability to institute our business plan. The strain on our systems,
procedures, controls and resources is further heightened by the fact that our
executive office and operational development facilities are located in separate
time zones (New York, New York and Edinburgh, Scotland, respectively).
We depend on patent and proprietary rights to develop and protect our
technologies and products, which rights may not offer us sufficient protection
The pharmaceutical industry places considerable importance on obtaining
patent and trade secret protection for new technologies, products and processes.
Our success will depend on our ability to obtain and enforce protection for
products that we develop under United States and foreign patent laws and other
intellectual property laws, preserve the confidentiality of our trade secrets
and operate without infringing the proprietary rights of third parties. Through
our current license agreements, we have acquired the right to utilize the
technology covered by issued patents and patent applications, as well as
additional intellectual property and know-how that could be the subject of
further patent applications in the future. Several of the original patents to
Modrenal(R) have expired in the United States and foreign countries. Thus, we
and our licensors are pursuing patent applications to specific uses, combination
therapy and dosages or formulations of Modrenal(R). We cannot guarantee that
such applications will result in issued patents or that such patents if issued
will provide adequate protection against competitors. Patents may not be issued
from these applications and issued patents may not give us adequate protection
or a competitive advantage. Issued patents may be challenged, invalidated,
infringed or circumvented, and any rights granted thereunder may not provide us
with competitive advantages. Parties not affiliated with us have obtained or may
obtain United States or foreign patents or possess or may possess proprietary
rights relating to products being developed or to be developed by us. Patents
now in existence or hereafter issued to others may adversely affect the
development or commercialization of products developed or to be developed by us.
Our planned activities may infringe patents owned by others. Our patents to
clofarabine are licensed from Southern Research Institute. The current projected
expiration date of the license is March 2021. These patents cover pharmaceutical
compositions and methods of using clofarabine. We cannot guarantee that these
patents would survive an attack on their validity or that they will provide a
competitive advantage over our competitors. Moreover, we cannot guarantee that
Southern Research Institute was the first to invent the subject matter of these
patents. In addition, we are aware of a third party patent which is directed to
the treatment of chronic myeloid leukemia ("CML") using specific doses of
clofarabine. We do not believe that we will infringe this patent. If this patent
is asserted against us, even though we may be successful in defending against
such an assertion, our defense would require substantial financial and human
resources. And, we may
-9-
need a license to this patent to use the claimed dose in the treatment of CML.
However, we do not know if such a license is available at commercially
reasonable terms, if at all.
We could incur substantial costs in defending infringement suits
brought against us or any of our licensors or in asserting any infringement
claims that we may have against others. We could also incur substantial costs in
connection with any suits relating to matters for which we have agreed to
indemnify our licensors or distributors. An adverse outcome in any litigation
could have a material adverse effect on our ability to sell products or use
patents in the future. In addition, we could be required to obtain licenses
under patents or other proprietary rights of third parties. These licenses may
not be made available on terms acceptable to us, or at all. If we are required
to, and do not obtain any required licenses, we could be prevented from, or
encounter delays in, developing, manufacturing or marketing one or more
products.
We also rely upon trade secret protection for our confidential and
proprietary information. Others may independently develop substantially
equivalent proprietary information and techniques or gain access to our trade
secrets or disclose our technology. We may not be able to meaningfully protect
our trade secrets which could limit our ability to exclusively produce products.
We require our employees, consultants, members of the scientific
advisory board and parties to collaborative agreements to execute
confidentiality agreements upon the commencement of employment or consulting
relationships or a collaboration with us. These agreements may not provide
meaningful protection of our trade secrets or adequate remedies in the event of
unauthorized use or disclosure of confidential and proprietary information.
Because we have international operations, we will be subject to risks of
conducting business in foreign countries
We have the right to manufacture, market and distribute our lead drugs,
clofarabine and Modrenal(R), in territories outside of the U.S. Specifically, we
currently market Modrenal(R) in the United Kingdom and upon receiving European
approval for clofarabine, we intend to market the drug throughout Europe.
Further, nearly half of our employees are employed by Bioenvision Limited, our
wholly-owned subsidiary with offices in Edinburgh, Scotland.
Because we have international operations in the conduct of our
business, we are subject to the risks of conducting business in foreign
countries, including:
o difficulty in establishing or managing distribution relationships;
o different standards for the development, use, packaging, pricing and
marketing of our products and technologies;
o our inability to locate qualified local employees, partners,
distributors and suppliers;
o the potential burden of complying with a variety of foreign laws, trade
standards and regulatory requirements, including the regulation of
pharmaceutical products and treatment; and
o general geopolitical risks, such as political and economic instability,
changes in diplomatic and trade relations, and foreign currency risks.
We do not engage in forward currency transactions which means we are
susceptible to fluctuations in the U.S. dollar against foreign currencies such
as the pound sterling. Accordingly, as the value of the dollar becomes weaker
against the pound sterling, ongoing services provided by our UK employees,
Cancer Research Organizations and other service providers become more expensive
to us. No assurance can be given that the U.S. dollar will not continue to
weaken which could have a material adverse effect on the costs associated with
our drug development activities.
We cannot predict our future capital needs and we may not be able to secure
additional financing which could affect our ability to operate as a going
concern
As of June 30, 2004, we had stockholders' equity of approximately
$27,383,000 and net working capital of approximately $18,828,000. However, we
may need additional financing to continue to fund the research and development
and marketing programs for our products and to generally expand and grow our
business. For example, we will need to employ a European sales force within the
next twelve months to capitalize on the commercial potential for clofarabine and
Modrenal(R) if and to the extent our lead drugs are at market in Europe by
mid-2005. To the extent that we will be required to fund operating losses, our
financial position would deteriorate. There can be no assurance that we will be
able to find significant additional financing at all or on terms favorable to
us. If equity securities are issued in connection with a financing, dilution to
our stockholders would result, and if additional funds are raised through the
incurrence of debt, we may be subject to restrictions on our operations and
finances. Furthermore, if we do incur debt, we may be limiting our ability to
repurchase capital stock, engage in mergers, consolidations, acquisitions and
asset sales, or alter our lines of business or accounting methods, even though
these actions would otherwise benefit our business. As of June 30, 2004, we had
stockholders' equity of approximately $27,383,000 and net working capital of
approximately $18,828,000.
-10-
If adequate financing is not available, we may be required to delay,
scale back or eliminate some of our research and development programs, to
relinquish rights to certain technologies or products, or to license third
parties to commercialize technologies or products that we would otherwise seek
to develop. Any inability to obtain additional financing, if required, would
have a material adverse effect on our ability to continue our operations and
implement our business plan.
The prices we charge for our products and the level of third-party reimbursement
may decrease and our revenues could decrease
Our ability to commercialize products successfully depends in part on
the price we may be able to charge for our products and on the extent to which
reimbursement for the cost of our products and related treatment will be
available from government health administration authorities, private health
insurers and other third-party payors. We believe that Government officials and
private health insurers are increasingly challenging the price of medical
products and services. Significant uncertainty exists as to the pricing
flexibility which distributors will have with respect to newly approved health
care products as well as the reimbursement status for such approved healthcare
products.
Third-party payors may attempt to control costs further by selecting
exclusive providers of their pharmaceutical products. If third-party payors were
to make this type of arrangement with one or more of our competitors, they would
not reimburse patients for purchasing our competing products. For example, if a
third-party payor in the U.K. were to pay patients for regimens of aromatase
inhibitor treatment but not treatments of Modrenal(R), this would cause a
decline in sales of Modrenal(R). This lack of reimbursement would diminish the
market for products developed by us and would have a material adverse effect on
us.
Our products may be subject to recall
Product recalls may be issued at our discretion or by the FDA, the FTC
or other government agencies having regulatory authority for product sales.
Product recalls, if any in the future, may harm our reputation and cause us to
lose development opportunities, or customers or pay refunds. Products may need
to be recalled due to disputed labeling claims, manufacturing issues, quality
defects, or other reasons. We do not carry any insurance to cover the risk of
potential product recall. Any product recall could have a material adverse
effect on us, our prospects, our financial condition and results of operations.
We may face exposure from product liability claims and product liability
insurance may not be sufficient to cover the costs of our liability claims
related to technologies or products
We face exposure to product liability claims if the use of our
technologies or products or those we license from third parties is alleged to
have resulted in adverse effects to users of such products. Product liability
claims may be brought by clinical trial participants, although to date, no such
claims have been brought against us. If any such claims were brought against us,
the cost of defending such claims may adversely affect our business. Regulatory
approval for commercial sale of our products does not mitigate product liability
risks. Any precautions we take may not be sufficient to avoid significant
product liability exposure. Although we have obtained product liability and
clinical trial insurance on our technologies and products at levels with which
management deems reasonable, no assurance can be given that this insurance will
cover any particular claim or that we have obtained an appropriate level of
liability insurance coverage for our development activities. We currently
maintain three million dollars per year, claims made product liability insurance
coverage which we believe is adequate. Existing coverage may not be adequate as
we further develop our products. In the future, adequate insurance coverage or
indemnification by collaborative partners may not be available in sufficient
amounts, or at acceptable costs, if at all. To the extent that product liability
insurance, if available, does not cover potential claims, we will be required to
self-insure the risks associated with those claims. The successful assertion of
any uninsured product liability or other claim against us could limit our
ability to sell our products or could cause monetary damages. In addition,
future product labeling may include disclosure of additional adverse effects,
precautions and contra indications, which may adversely impact product sales.
The pharmaceutical industry has experienced increasing difficulty in maintaining
product liability insurance coverage at reasonable levels, and substantial
increases in insurance premium costs, in many cases, have rendered coverage
economically impractical.
The price of our Common Stock is likely to be volatile and subject to wide
fluctuations
The market price of the securities of biotechnology companies has been
especially volatile. Thus, the market price of our Common Stock is likely to be
subject to wide fluctuations. For the twelve month period ended October 22,
2004, our closing stock price has ranged from a high of $11.75 to a low of
$3.00. If our revenues do not grow or grow more slowly than we anticipate, or,
if operating or capital expenditures exceed our expectations and cannot be
adjusted accordingly, or if some other event adversely affects us, the market
price of our Common Stock could decline. In addition, if the market for
pharmaceutical and biotechnology stocks or the stock market in general
experiences a loss in investor confidence or otherwise fails, the market price
of our Common Stock could fall for reasons unrelated to our business, results of
operations and financial condition. The market price of our stock also might
decline in reaction to events that affect other companies in our industry even
if these events do not directly affect us. In the past, companies that have
experienced volatility in the market price of their stock have been the subject
of securities class action litigation.
-11-
If we were to become the subject of securities class action litigation, it could
result in substantial costs and a diversion of management's attention and
resources.
Certain events could result in a dilution of holders of our Common Stock
As of October 22, 2004, we had 28,797,170 shares of Common Stock
outstanding, 3,275,000 shares of Series A Convertible Preferred Stock
outstanding which are currently convertible into 6,550,000 shares of Common
Stock and common stock equivalents, and warrants and stock options, convertible
or exercisable into 12,916,868 shares of our Common Stock. The exercise and
conversion prices of the common stock equivalents range from $0.74 to $8.25 per
share. We have also reserved for issuance an aggregate of 3,000,000 shares of
Common Stock for a stock option plan for our employees. Historically, from time
to time, we have awarded our Common Stock to officers of the Company, in lieu of
cash compensation, although we do not expect to do so in the future. As of
October 22, 2004, (i) we have 37,750,699 shares of common stock registered under
the Securities Act and (ii) the sale of shares of Common Stock underlying
4,500,000 options are registered under the Securities Act on Form S-8. The
future resale of these shares and shares underlying stock options and warrants
will result in a dilution to your percentage ownership of our Common Stock and
could adversely affect the market price of our Common Stock.
The terms of our Series A Convertible Preferred Stock include
antidilution protection upon the occurrence of sales of our Common Stock below
certain prices, stock splits, redemptions, mergers and other similar
transactions. If one or more of these events occurs the number of shares of our
Common Stock that may be acquired upon conversion or exercise would increase. If
converted or exercised, these securities will result in a dilution to your
percentage ownership of our Common Stock. The resale of many of the shares of
Common Stock which underlie these options and warrants are registered under this
prospectus and the sale of such shares may adversely affect the market price of
our Common Stock.
FORWARD LOOKING STATEMENTS
Our disclosure and analysis in this prospectus, the applicable
prospectus supplement and the documents incorporated by reference into this
prospectus and the applicable prospectus supplement contain forward-looking
statements, which provide information regarding our current expectations, plans,
objectives and forecasts of future events. Words such as "may," "will,"
"believe," "estimate," "anticipate," "plan," "expect," "may affect," and
"intend", or statements concerning "potential" or "opportunity" and similar
expressions or the negative thereof, are intended to identify forward-looking
statements, but the absence of these words does not mean that a statement is not
forward-looking. Forward-looking statements include, without limitation:
o statements about our drug development and commercialization goals and
expectations;
o potential regulatory approvals;
o our plans for and anticipated results of our clinical development
activities;
o the potential advantage of our drug candidates;
o statements about our future capital requirements, the sufficiency of
our capital resources to meet those requirements and the expected
composition of our capital resources; and
o other statements that are not historical facts.
Forward looking statements are based on the judgment of management at
the time the statements are made. Inaccurate assumptions and known and unknown
risks and uncertainties can affect the accuracy of forward-looking statements.
Our actual results could differ materially from those stated in or implied by
forward-looking statements for a number of reasons, including the risks
described in the sections of this prospectus and the applicable prospectus
entitled "Risk Factors," in our other public filings, press releases and
statements by our management. Other factors besides those described in this
prospectus, the applicable prospectus supplement and in our other public
filings, press releases and statements by our management could also affect
actual results.
You should not unduly rely on these forward-looking statements, which
speak only as of the date of this prospectus or the applicable prospectus
supplement. We undertake no obligation to publicly update any forward-looking
statement to reflect new information, events or circumstances, whether
anticipated or unanticipated, or to conform the statement to actual results or
changes in our expectations. You should, however, review the factors, risks and
other information we provide in the reports we file from time to time with the
SEC.
-12-
USE OF PROCEEDS
Unless otherwise indicated in the applicable prospectus supplement, we
intend to use any net proceeds from the sale of Common Stock offered by this
prospectus for additional working capital and other general corporate purposes,
including, but not limited to, further development of our lead products and
increased sales and marketing expenses related to the commercial launch of our
products. Until we have used the net proceeds, we may invest them in short-term
marketable securities.
DESCRIPTION OF CAPITAL STOCK
Description of Common Stock
Number of Authorized and Outstanding Shares. Our Certificate of
Incorporation authorizes the issuance of 70,000,000 shares of common stock,
$.001 par value per share, of which 28,797,170 shares were outstanding on
October 22, 2004. All of the outstanding shares of common stock are fully paid
and non-assessable.
Voting Rights. Holders of shares of common stock are entitled to one
vote for each share on all matters to be voted on by the stockholders. Holders
of common stock have no cumulative voting rights. Accordingly, the holders of a
simple majority of the outstanding common stock and Series A convertible
preferred stock, voting together as a class at a stockholders meeting at which a
quorum is present, can elect all of the directors nominated for election at the
meeting.
Other. Holders of common stock have no preemptive rights to purchase
our common stock. There are no conversion rights or redemption or sinking fund
provisions with respect to the common stock.
Transfer Agent. Shares of common stock are registered at the transfer
agent and are transferable at such office by the registered holder (or duly
authorized attorney) upon surrender of the common stock certificate, properly
endorsed. No transfer shall be registered unless we are satisfied that such
transfer will not result in a violation of any applicable federal or state
securities laws. The transfer agent for our common stock is Liberty Transfer
Company, 274B New York Avenue, Huntington, New York 11743.
Description of Preferred Stock
Number of Authorized Shares. Our certificate of incorporation
authorizes the issuance of up to 20,000,000 shares of preferred stock, par value
$.001 per share, in one or more series with such limitations and restrictions as
may be determined in the sole discretion of our board of directors, with no
further authorization by stockholders required for the creation and issuance
thereof.
We have designated 5,920,000 shares of our preferred stock as Series A
convertible preferred stock, of which 3,275,000 shares were issued and
outstanding as of October 22, 2004. The holders of the Series A convertible
preferred stock vote as a single class with the common stock, on an as-converted
basis, on all matters upon which the holders of the common stock are entitled to
vote. Each outstanding share of Series A convertible preferred stock may
currently be converted into two shares of common stock, at the conversion price
of $1.50 per share. The shares of Series A convertible preferred stock shall be
automatically convertible into shares of common stock if the market price of the
common stock after one year from the date of issuance is $10.00 or more for 30
consecutive trading days and the trading volume is at least 150,000 shares per
trading day during such 30-day period. Holders of Series A convertible preferred
stock have a liquidation preference over holders of common stock of $3.00 per
share. Holders of the Series A convertible preferred stock are entitled to an
annual 5% dividend which may be paid in cash or additional shares of common
stock in our sole discretion.
Our charter also authorizes our board of directors to increase the
number of shares of preferred stock we may issue without approval of common
stockholders. Preferred stock may be issued in one or more series, the terms of
which may be determined without further action by common stockholders. These
terms may include preferences, conversion or other rights, voting powers,
restrictions, limitations as to dividends, qualifications or terms or conditions
of redemption. The issuance of any preferred stock could materially adversely
affect the rights of holders of our common stock, and therefore could reduce its
value. In addition, specific rights granted to future holders of preferred stock
could be used to restrict our ability to merge with, or sell assets to, a third
party. The power of the board of directors to issue preferred stock could make
it more difficult, delay, discourage, prevent or make it more costly to acquire
or effect a change in control, thereby preserving the current stockholders'
control.
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Delaware Law and Certain By-Law Provisions
Certain provisions of our by-laws are intended to strengthen our board
of directors' position in the event of a hostile takeover attempt. These by-law
provisions have the following effects:
o they provide that only business brought before the annual
meeting by our board of directors or by a stockholder who
complies with the procedures set forth in the by-laws may be
transacted at an annual meeting of stockholders; and
o they establish a procedure for our board of directors to fix
the record date whenever stockholder action by written consent
is undertaken.
Furthermore, our Company is subject to the provisions of Section 203 of
the Delaware General Corporation Law, an anti-takeover law. In general, the
statute prohibits a publicly held Delaware corporation from engaging in a
"business combination" with an "interested stockholder" for a period of three
years after the date of the transaction in which the person became an interested
stockholder, unless the business combination is approved in a prescribed manner.
For purposes of Section 203, a "business combination" includes a merger, asset
sale or other transaction resulting in a financial benefit to the interested
stockholder, and an "interested stockholder" is a person who, together with
affiliates and associates, owns, or within three years prior, did own, 15% or
more of the corporation's voting stock.
PLAN OF DISTRIBUTION
We may sell our securities from time to time by any method permitted by
the Securities Act of 1933, including in the following ways:
o through one or more underwriters on a firm commitment or best
efforts basis;
o directly to one or more purchasers;
o through agents;
o through broker-dealers, who may act as agents or principals,
including a block trade in which a broker or dealer so engaged
will attempt to sell the securities as agent but may position
and resell a portion of the block as principal to facilitate
the transaction;
o in privately negotiated transactions; and
o in any combination of these methods of sale.
The applicable prospectus supplement will set forth:
o the specific terms of the offering of our securities,
including the name or names of any underwriters, dealers or
agents;
o the purchase price of the securities and the proceeds to us
from the sale;
o any underwriting discounts and commissions or agency fees and
other items constituting underwriters' or agents'
compensation;
o the initial offering price to the public and any discounts or
concessions allowed or reallowed or paid to dealers; and
o the name of any securities exchange on which the securities
may be listed.
Any public offering price, discounts or concessions allowed or
reallowed or paid to dealers may be changed from time to time.
We expect that any common stock sold pursuant to a prospectus
supplement will be listed on the Nasdaq National Market.
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The distribution of the securities may be effected from time to time in
one or more transactions at a fixed price or prices (which may be changed), at
market prices prevailing at the time of sale, at prices related to the
prevailing market prices or at negotiated prices.
Offers to purchase our securities may be solicited by agents designated
by us from time to time. Broker-dealers or agents may receive compensation in
the form of commissions, discounts or concessions from us. Broker-dealers or
agents may also receive compensation from the purchasers of the securities for
whom they sell as principals. Each particular broker-dealer will receive
compensation in amounts negotiated in connection with the sale, which might be
in excess of customary commissions. Broker-dealers or agents and any other
participating broker-dealers participating in the distribution of our securities
may be deemed to be underwriters, and any discounts and commissions received by
them and any profit realized by them on resale of the securities may be deemed
to be underwriting discounts and commissions.
If required under applicable state securities laws, we will sell the
securities only through registered or licensed brokers or dealers. In addition,
in some states, we may not sell securities unless they have been registered or
qualified for sale in the applicable state or an exemption from the registration
or qualification requirement is available and complied with.
If the securities are sold by means of an underwritten offering, we
will execute an underwriting agreement with an underwriter or underwriters, and
the names of the specific managing underwriter or underwriters, as well as any
other underwriters, and the terms of the transaction, including commissions,
discounts and any other compensation of the underwriters and dealers, if any,
will be set forth in the applicable prospectus supplement, which will be used by
the underwriters to make resales of the securities. Under agreements into which
we may enter, underwriters, dealers and agents who participate in the
distribution of the securities may be entitled to indemnification by us against
some liabilities, including liabilities under the Securities Act.
If we use underwriters for an offering of securities, the underwriters
may acquire the securities for their own accounts. The underwriters may resell
the securities from time to time in one or more transactions at a fixed price or
prices, which may be changed, at varying prices determined by the underwriters
at the time of sale, or at negotiated prices. We also may, from time to time,
authorize underwriters acting as our agents to offer and sell the securities
upon the terms and conditions as will be set forth in the applicable prospectus
supplement. In connection with the sale of the securities, underwriters may be
deemed to have received compensation from us in the form of underwriting
discounts or commissions and also may receive commissions from purchasers of the
securities. Underwriters may sell the securities to or through dealers, who may
receive compensation in the form of discounts, concessions from the underwriters
and/or commissions from the purchasers of the securities.
Any underwriting compensation paid by us to underwriters or agents in
connection with any offering of the securities and any discounts, concessions or
commissions allowed by underwriters to participating dealers will be set forth
in the applicable prospectus supplement. Underwriters, dealers and agents
participating in the distribution of our securities may be deemed to be
underwriters, and any discounts and commissions received by them and any profit
realized by them on resale of the securities may be deemed to be underwriting
discounts and commissions.
If so indicated in the applicable prospectus supplement, we may
authorize underwriters, dealers or agents to solicit offers from certain types
of institutions to purchase securities from us at the public offering price set
forth in the applicable prospectus supplement pursuant to delayed delivery
contracts providing for payment and delivery on a future date. Institutions with
which delayed delivery contracts may be made include commercial and savings
banks, insurance companies, pension funds, investment companies, educational and
charitable institutions, and other institutions. The applicable prospectus
supplement will set forth the commission payable for solicitation of such
offers.
Our securities may be offered to the public either through underwriting
syndicates represented by managing underwriters or directly by the managing
underwriters. If any underwriters are utilized in the sale of the securities,
the underwriting agreement will provide that the obligations of the underwriters
are subject to specified conditions precedent. If we sell our securities to one
or more underwriters on a firm commitment basis, then the underwriters will be
obligated to purchase all of the securities offered if any are purchased.
We may grant to the underwriters options to purchase additional
securities to cover over-allotments, if any, at the public offering price with
additional underwriting discounts or commissions, as may be set forth in the
applicable prospectus supplement. If we grant any over-allotment option, the
terms of the over-allotment option will be set forth in the applicable
prospectus supplement.
In connection with any offering, persons participating in the offering,
such as any underwriters, may purchase and sell the securities in the open
market. These transactions may include over-allotment and stabilizing
transactions and purchases to cover syndicate short positions created in
connection with the offering. Stabilizing transactions consist of bids or
purchases for the purpose of preventing or retarding a decline in the market
price of the securities and syndicate short positions involve the sale by
underwriters of a greater number of securities than they are required to
purchase from us in the offering. Underwriters also may impose a penalty bid,
whereby selling concessions allowed to syndicate members or other broker-dealers
in respect of the securities sold in the offering
-15-
for their account may be reclaimed by the syndicate if the securities are
repurchased by the syndicate in stabilizing or covering transactions. These
activities may stabilize, maintain or otherwise affect the market price of the
securities, which may be higher than the price that might prevail in the open
market, and these activities, if commenced, may be discontinued at any time.
Any underwriters, dealers or agents involved in any distribution or
sale of our securities may be customers of, engage in transactions with or
perform services for us from time to time.
We will bear all costs, expenses and fees in connection with the
registration of the securities as well as the expense of all commissions and
discounts, if any, attributable to the sales of the securities by us.
LEGAL MATTERS
Unless otherwise indicated in the applicable prospectus supplement, the
validity of the shares of common stock offered by this prospectus and other
legal matters relating to this offering will be passed on by Paul, Hastings,
Janofsky & Walker LLP, New York, New York.
EXPERTS
Our auditors are Grant Thornton LLP. Our consolidated financial
statements as at and for the years ended June 30, 2004 and June 30, 2003
included in our annual report on Form 10-KSB for the year ended June 30, 2004
and incorporated by reference herein, have been incorporated by reference herein
in reliance upon the report of Grant Thornton LLP, independent registered public
accountants, given on the authority of said firm as experts in accounting and
auditing.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the SEC. You may read and copy any materials we have
filed with the SEC at the SEC's public reference rooms. The SEC also maintains a
web site (http://www.sec.gov) that contains reports, proxy statements and other
information concerning us. Please call the SEC at 1-800-SEC-0330 for information
concerning the operations of the public reference rooms or visit the SEC at the
following locations:
Public Reference Room Midwest Regional Office
450 Fifth Street, N.W. Citicorp Center
Room 1024 500 West Madison Street
Washington, D.C. 20549 Suite 1400
Chicago, Illinois 60661-2511
We have filed with the SEC a registration statement on Form S-3 under
the Securities Act to register the securities to be sold in this offering. This
prospectus, which is part of the registration statement, does not contain all of
the information set forth in the registration statement or the exhibits and
schedules to the registration statement. For further information regarding
Bioenvision and our securities, please refer to the registration statement and
the documents filed as exhibits to the registration statement.
INCORPORATION BY REFERENCE
The SEC allows us to "incorporate by reference" the information we file
with it, which means that we can disclose important information to you by
referring you to those filed documents. The information incorporated by
reference is considered to be part of this prospectus, and information that we
file later with the SEC will automatically update and supersede this
information.
The following documents, which have been filed with the SEC, are hereby
incorporated by reference:
o Our definitive proxy statement dated October ___, 2004,
relating to our December 2004 annual meeting of stockholders, and
o Our annual report on Form 10-KSB for the year ended June 30,
2004 filed on September 24, 2004 (File No. 001-31787);
All other reports and documents subsequently filed by us with the SEC
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act
after the date of this prospectus and prior to the termination of the offering
are deemed incorporated by reference into this prospectus and a part hereof from
the date of filing of those documents. Any statement contained in any document
incorporated by reference shall be deemed to be modified or superseded for the
purposes of this prospectus to the extent that a
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statement contained in a later document modifies or supersedes such statement.
Any statements so modified or superseded shall not be deemed to constitute a
part of this prospectus, except as modified or superseded.
We will provide without charge to each person, including any beneficial
owner, to whom this prospectus is delivered, upon written or oral request of
such person, a copy of any or all of the documents referred to above which have
been or may be incorporated by reference into this prospectus (other than the
exhibits to such documents). Requests for such documents should be directed to
Bioenvision Inc., 509 Madison Avenue, Suite 404, New York, New York 10022,
Attention: David P. Luci (telephone: (212) 750-6700).
We have not authorized any dealer, salesperson or other person to give
any information or represent anything not contained in this prospectus. You
should not rely on any unauthorized information. This prospectus does not offer
to sell or solicit an offer to buy any shares in any jurisdiction in which it is
unlawful. The information in this prospectus is current as of the date on the
cover.
DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR
SECURITIES ACT LIABILITIES
Our bylaws provide that directors and officers shall be indemnified by
us to the fullest extent authorized by the Delaware General Corporation Law,
against all expenses and liabilities reasonably incurred in connection with
services for us or on our behalf.
Insofar as indemnification for liabilities arising under the Securities
Act might be permitted to directors, officers or persons controlling our company
under the provisions described above, we have been informed that in the opinion
of the Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act and is therefore unenforceable.
-17-
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following sets forth the estimated expenses payable in connection with the
preparation and filing of this Registration:
*Printing and Engraving Expenses............................... 15,000
*Accounting Fees and Expenses.................................. 15,000
*Legal Fees and Expenses....................................... 50,000
*Blue Sky Fees and Expenses.................................... 2,000
*Transfer Agent's and Registrar's Fees and Expenses............ 1,000
*Miscellaneous................................................. 17,000
------
*Total.............................................. $100,000
====== ========
* Estimated.
Item 15. Indemnification of Directors and Officers.
The indemnification of officers and directors of the Registrant is
governed by Section 145 of the General Corporation Law of the State of Delaware
(the "DGCL") and the Certificate of Incorporation, as amended, and By-Laws of
the Registrant. Subsection (a) of DGCL Section 145 empowers a corporation to
indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative (other than an action by or in
the right of the corporation) by reason of the fact that the person is or was a
director, officer, employee or agent of the corporation, or is or was serving at
the request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by the person in connection with
such action, suit or proceeding if the person acted in good faith and in the
manner the person reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe the person's conduct was
unlawful.
Subsection (b) of DGCL Section 145 empowers a corporation to indemnify
any person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action or suit by or in the right of the
corporation to procure a judgment in its favor by reason of the fact that the
person is or was a director, officer, employee or agent of the corporation, or
is or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise against expenses (including attorneys' fees) actually and
reasonably incurred by the person in a connection with the defense or settlement
of such action or suit if the person acted in good faith and in the manner the
person reasonably believed to be in or not opposed to the best interests of the
corporation and except that no indemnification shall be made in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable to the corporation unless and only to the extent that the Delaware Court
of Chancery or the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability but in
view of all the circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which the Court of Chancery or such
other court shall deem proper.
DGCL Section 145 further provides that to the extent that to a present
or former director or officer is successful, on the merits or otherwise, in the
defense of any action, suit or proceeding referred to in subsections (a) and (b)
of Section 145, or in defense of any claim, issue or matter therein, such person
shall be indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by such person in connection therewith. In all cases in
which indemnification is permitted under subsection (a) and (b) of Section 145
(unless ordered by a court), it shall be made by the corporation only as
authorized in the specific case upon a determination that indemnification of the
present or former director, officer, employee or agent is proper in the
circumstances because the applicable standard of conduct has been met by the
party to be indemnified. Such determination must be made, with respect to a
person who is a director or officer at the time of such determination, (1) by a
majority vote of the directors who are no parties to such action, suit or
proceeding, even though less than a quorum, or (2) by a committee of such
directors designated by majority vote of such directors, even though less than a
quorum, or (3) if there are no such directors, or if such directors so direct,
by independent legal counsel in a written opinion, or (4) by the stockholders.
The statute authorizes the corporation to pay expenses incurred by an officer or
director in advance of the final disposition of a proceeding upon receipt of an
undertaking by or on behalf of the person to whom the advance will be made, to
repay the advances if it shall ultimately be determined that he was not entitled
to indemnification. DGCL Section 145 also provides that indemnification and
advancement of expenses permitted thereunder are not to be exclusive of any
other rights to which those seeking indemnification or advancement of expenses
may be entitled under any By-law, agreement, vote of stockholders or
disinterested directors, or otherwise. DGCL Section 145 also authorizes the
corporation to purchase and maintain
II-1
liability insurance on behalf of its directors, officers, employees and agents
regardless of whether the corporation would have the statutory power to
indemnify such persons against the liabilities insures.
Article Seventh of the Certificate of Incorporation of the Registrant,
as amended (the "Certificate"), provides that no director of the Registrant
shall be personally liable to the Registrant or its stockholders for monetary
damages for breach of fiduciary duty as a director except for liability (i) for
any breach of the director's duty of loyalty to the Registrant or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under Section 174 of
the DGCL (involving certain unlawful dividends or stock purchases or
redemptions), or (iv) for any transaction from which the director derived an
improper personal benefit.
Pursuant to Section 145(g) of the DGCL, the Registrant's By-Laws, as
amended, authorize the Registrant to obtain insurance to protect officers and
directors from certain liabilities, including liabilities against which the
Registration cannot indemnify its officers and directors.
In derivative actions, Bioenvision may only protect from liability its
officers, directors, employees and agents against expenses actually and
reasonably incurred in connection with the defense or settlement of a suit, and
only if they acted in good faith and in a manner they reasonably believed to be
in, or not opposed to, the best interests of the corporation. Indemnification is
not permitted in the event that the director, officer, employee or agent is
actually adjudged liable to Bioenvision unless, and only to the extent that, the
court in which the action was brought so determines.
Bioenvision's Certificate of Incorporation permits it to protect from
liability its directors except in the event of: (1) any breach of the director's
duty of loyalty to Bioenvision or its stockholders; (2) any act or failure to
act that is not in good faith or involves intentional misconduct or a knowing
violation of the law; (3) liability arising under Section 174 of the Delaware
General Corporation Law, relating to unlawful stock purchases, redemptions, or
payment of dividends; or (4) any transaction in which the director received an
improper personal benefit.
Item 16. Exhibits
Exhibit
Number Description
--------- --------------
5.1* Opinion of Paul, Hastings, Janofsky & Walker, LLP
23.1 Consent of Grant Thornton LLP
23.2* Consent of Paul, Hastings, Janofsky & Walker LLP (included
in Exhibit 5.1)
24.1 Power of Attorney (appears on signature page)
* To be filed by amendment.
Item 17. Undertakings.
(a) The undersigned registrant hereby undertakes:
(1) 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 a 20% change in the
maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the
effective registration statement.
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(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 (a)(1)(i)
and (a)(1)(ii) 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 by the registrant
pursuant to Section 13 or Section 15(d) of
the Securities Exchange Act of 1934 that are
incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, 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) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act
of 1933, each filing of the registrant's annual report
pursuant to Section 13(a) or Section 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section
15(d) of the Securities Exchange Act of 1934) 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.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers
and controlling persons of the registrant pursuant to the
foregoing provisions, or otherwise, the registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against such 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 Act and will be
governed by the final adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, 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 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 the 25th day of
October, 2004.
BIOENVISION, INC.
By /s/ Christopher B. Wood
--------------------------
Christopher B. Wood, Chairman of the
Board and Chief Executive Officer
KNOW ALL MEN BY THESE PRESENT, that each person whose signature appears
below constitutes and appoints Christopher B. Wood as his true and lawful
attorney-in-fact and agent, with full power of substitution and resubstitution
for him/ and in his name, place and stead, in any and all capacities, to sign
any and all amendments and post-effective amendments to this registration
statement, and make such changes and additions to this registration statement
for the same offering that may be filed under Rule 462(b), and to file the same,
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto the attorney-in-fact and agent
full power and authority to do and perform each and every act and thing
requisite and necessary to be done and about the premises, as fully to all
intents and purposes as he/she might or could do in person, thereby ratifying
and confirming all that the attorney-in-fact and agent, or his/her substitutes,
may lawfully do or cause to be done by virtue thereof and the registrant hereby
confers like authority on its behalf.
In accordance with the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ Christopher B. Wood, M.D. Chairman and Chief Executive Officer and October 25, 2004
----------------------------- Director
Christopher B. Wood (Principal Executive Officer)
/s/ David P. Luci Chief Financial Officer, General Counsel October 25, 2004
----------------- (Principal Financial and Accounting
David P. Luci Officer)
/s/ Thomas S. Nelson, C.A. Director October 25, 2004
-------------------------
Thomas S. Nelson, C.A.
/s/ Michael Kauffman Director October 25, 2004
--------------------
Michael Kauffman
/s/ Andrew N. Schiff Director October 25, 2004
--------------------
Andrew N. Schiff
/s/ Steven A. Elms Director October 25, 2004
------------------
Steven A. Elms
II-4
EXHIBIT INDEX
Exhibit
Number Description
--------- --------------
5.1* Opinion of Paul, Hastings, Janofsky & Walker, LLP
23.1 Consent of Grant Thornton LLP
23.2* Consent of Paul, Hastings, Janofsky & Walker LLP (included
in Exhibit 5.1)
24.1 Power of Attorney (appears on signature page)
* To be filed by amendment.
II-5