<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 12, 2001
REGISTRATION NO. 333-91957
--------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
POST EFFECTIVE AMENDMENT NO. 1 TO FORM SB-2/A ON FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
NEXMED, INC.
(Exact Name of Registrant as Specified in its Charter)
NEVADA 87-0449967
(State or Other Jurisdiction of (I.R.S. Employer Identification
Incorporation) Number)
350 CORPORATE BOULEVARD
ROBBINSVILLE, NEW JERSEY 08691
(609) 208-9688
(Address, Including Zip Code, and Telephone Number, Including Area Code, of
Registrant's Principal Executive Offices)
VIVIAN H. LIU
350 CORPORATE BOULEVARD
ROBBINSVILLE, NEW JERSEY 08691
(609) 208-9688
(609) 208-1868 (FACSIMILE)
(Name, Address, Including Zip Code, and Telephone Number,
Including Area Code, of Agent For Service)
COPIES TO:
ROBERT L. KOHL, ESQ.
ROSENMAN & COLIN LLP
575 MADISON AVENUE
NEW YORK, NEW YORK 10022
(212) 940-8800
(212) 940-8776(FACSIMILE)
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE OF THE SECURITIES TO THE
PUBLIC: As soon as possible after the Registration Statement becomes effective.
If the only Securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, check the following box.
[ ]
<PAGE>
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 of 1933, check the following
box and list the Securities Act of 1933 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 of 1933, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. |_|
If delivery of the prospectus is expected to be made pursuant to Rule 434,
check the following box. [ ]
--------------------------------------------------------------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------
Title of Shares to be Amount to be Proposed Maximum Proposed Maximum Amount of
Registered Registered Aggregate Price Per Aggregate Offering Price Registration
Share Fee
------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
common stock, $0.001 par 10,657,478* $4.125 $43,962,096.75 $11,616**
value (the "Common Stock")
------------------------------------------------------------------------------------------------------------------------
</TABLE>
--------------------------------------------------------------------------------
* Previously registered when the Registration Statement on Form S-3 (File
No. 333-91957) of NexMed, Inc., was initially filed with the Securities and
Exchange Commission on December 2, 1999.
** Previously paid when the Registration Statement on Form S-3 (File No.
333-91957) of NexMed, Inc., was initially filed with the Securities and Exchange
Commission on December 2, 1999.
EXPLANATORY NOTE
This Post-Effective Amendment No. 1 to the Registration Statement on Form SB-2/A
(File No. 333-91957) of NexMed, Inc., initially filed with the Securities and
Exchange Commission on December 27, 1999, is being amended on Form S-3.
<PAGE>
PROSPECTUS
NEXMED, INC.
3,625,091 SHARES
COMMON STOCK
This prospectus relates to the public offering of up to 3,625,091 shares of
Common Stock of NexMed, Inc., a Nevada corporation, all of which are being
offered by the selling shareholders named in this prospectus.
1,525,091 shares consist of shares of Common Stock acquired by 16 of the
selling shareholders who participated in a private placement conducted by us
pursuant to an exemption from registration under the Securities Act of 1933,
provided by rule 506 of Regulation D.
2,000,000 of the shares consist of shares of Common Stock previously issued
upon the exercise of warrants acquired by Vergemont International Limited, in
connection with our sale of NexMed Pharmaceuticals (Zhongshan) Ltd., a Chinese
joint venture company we formed through NexMed (Asia) Limited with Zhongsham
Xiaolan Pharmaceutical Factory in 1997.
100,000 of the shares consist of shares of Common Stock issuable upon
exercise of warrants with an exercise price of $1.00 that were received by Pryor
Cashman Sherman & Flynn LLP as consideration for legal services previously
rendered to us.
Although we will receive the exercise price of any warrants exercised by
the selling shareholders, all net proceeds from the sale of the shares of Common
Stock offered by this prospectus will go to the selling shareholders; we will
not receive any proceeds from such sales. Assuming all of the warrants not yet
exercised are exercised, we would receive gross proceeds of $100,000.
Our Common Stock is listed on the Nasdaq National Market System under the
ticker symbol "NEXM". On January 10, 2001, the last reported sale price of our
common stock was $7.125 per share.
---------------------
THE SHARES OFFERED IN THIS PROSPECTUS INVOLVE A HIGH DEGREE OF RISK. YOU
SHOULD CAREFULLY CONSIDER THE "RISK FACTORS" BEGINNING ON PAGE 9, IN DETERMINING
WHETHER TO PURCHASE SHARES OF OUR COMMON STOCK.
---------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this prospectus is , 2001
No person has been authorized to give any information or to make any
representations other than those contained in this prospectus in connection with
the offering made hereby, and if given or made, such information or
representations must not be relied upon as having been authorized by NexMed,
1
<PAGE>
Inc. any selling stockholder or by any other person. Neither the delivery of
this prospectus nor any sale made hereunder shall, under any circumstances,
create any implication that information herein is correct as of any time
subsequent to the date hereof. This prospectus does not constitute an offer to
sell or a solicitation of an offer to buy any security other than the securities
covered by this prospectus, nor does it constitute an offer to or solicitation
of any person in any jurisdiction in which such offer or solicitation may not
lawfully be made.
2
<PAGE>
TABLE OF CONTENTS
Page
----
WHERE YOU CAN FIND MORE INFORMATION .................................... 4
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE ........................ 4
INFORMATION ABOUT US ................................................... 5
RISK FACTORS ........................................................... 9
USE OF PROCEEDS ........................................................ 16
INDEMNIFICATION FOR SECURITIES ACT LIABILITIES ......................... 16
SELLING SHAREHOLDERS ................................................... 17
PLAN OF DISTRIBUTION ................................................... 18
LEGAL MATTERS .......................................................... 20
EXPERTS ................................................................ 20
3
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the Securities and Exchange Commission. We have an internet
website address at http:/www.nexmed.com. You may read and copy any document we
file at the Securities and Exchange Commission's public reference room located
at 450 Fifth Street, N.W., Washington, D.C. 20549. Please call the Securities
and Exchange Commission at 1-800-732-0330 for further information on the
operation of such public reference room. You also can request copies of such
documents, upon payment of a duplicating fee, by writing to the Securities and
Exchange Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 or obtain
copies of such documents from the Securities and Exchange Commission's web site
at http://www.sec.gov.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Securities and Exchange Commission allows us to "incorporate by
reference" the information we file with them, which means that we can disclose
important information to you by referring you to those documents. The
information we incorporate by reference is considered to be part of this
prospectus and information that we file later with the Securities and Exchange
Commission automatically will update and supersede such information. We
incorporate by reference the documents listed below and any future filings we
make with the Securities and Exchange Commission under Sections 13(a), 13(c), 14
or 15(d) of the Securities Exchange Act of 1934, as amended:
(1) Our Annual Report on Form 10-KSB (File No. 0-22245) for the fiscal year
ended December 31, 1999;
(2) Our Quarterly Report on Form 10-QSB (File No. 0-22245) for the fiscal
quarter ended March 31, 2000;
(3) Our Quarterly Report on Form 10-QSB (File No. 0-22245) for the fiscal
quarter ended June 30, 2000;
(4) Our Quarterly Report on Form 10-QSB (File No. 0-22245) for the fiscal
quarter ended September 30, 2000;
(5) Our Current Report on Form 8-K (File No. 0-22245), dated April 10,
2000;
(6) Our Current Report on Form 8-K (File No. 0-22245), dated November 6,
2000;
(7) The description of our articles of incorporation and bylaws, both
contained in our Registration Statement on Form 10-SB (File No.
0-22245), dated March 14, 1997, including any amendment or report filed
for the purpose of updating such information; and
(8) The description of our securities contained in our Registration
Statement on Form S-3 (File No. 333-46976), dated September 29, 2000,
including any amendment or report filed for the purpose of updating
such information.
4
<PAGE>
You may request a copy of these filings (including exhibits to such filings
that we have specifically incorporated by reference in such filings), at no
cost, by writing or telephoning our executive offices at the following address:
NexMed, Inc.
350 Corporate Boulevard
Robbinsville, New Jersey 08691
Attention: Ms. Vivian H. Liu
(609) 208-9688
You should rely only on the information provided or incorporated by
reference in this prospectus or any related supplement. We have not authorized
anyone else to provide you with different information. The selling shareholders
will not make an offer of these shares in any state that prohibits such an
offer. You should not assume that the information in this prospectus or any
supplement is accurate as of any date other than the date on the cover page of
such documents.
All references in this prospectus to "NexMed," the "Company," "us," "our,"
"Registrant," or "we" include NexMed,Inc., a Nevada corporation, and any
subsidiaries or other entities that we own or control. All references in this
prospectus to "Common Stock" refer to our Common Stock, par value $.001 per
share. All references in this prospectus to "warrants," refer to the series of
warrants to purchase shares of our Common Stock held by the selling
shareholders.
The following summary is qualified in its entirety by the more detailed
information and financial statements appearing elsewhere in this prospectus or
incorporated by reference in this prospectus.
INFORMATION ABOUT US
We have been in existence since 1987. Since 1994, we have positioned
ourselves as a pharmaceutical and medical technology company with a focus on
developing and commercializing therapeutic products based on proprietary
delivery systems. We are currently focusing our efforts on:
(i) new and patented pharmaceutical products based on a penetration
enhancement topical delivery technology known as NexACT(R), which may enable the
active drug to be better absorbed through the skin. Currently, we are focusing
on Alprox-TD(R), an alprostadil cream for the treatment of male erectile
dysfunction ("ED") and Femprox(TM), also an alprostadil-based cream, for the
treatment of female sexual arousal disorder ("FSAD").
We have completed the testing of 190 patients under our Phase II clinical
program on the Alprox-TD(R) cream which was conducted at 12 clinical research
sites throughout the U.S. This Phase II testing program on the Alprox-TD(R)
cream consisted of double-blind, placebo-controlled studies designed to evaluate
the safety and efficacy of the product. We have submitted the Phase II trial
data to the FDA for review. Subject to FDA concurrence, we intend to initiate
our planned Phase III clinical development program for the Alprox-TD(R) cream in
the first quarter of 2001. With respect to the Femprox(TM) cream, we have
completed a Phase I clinical program on 8
5
<PAGE>
patients and pending FDA concurrence, we intend to begin our proposed Phase II
program in the first quarter of 2001.
We have engaged in discussions with several large pharmaceutical companies
regarding a strategic partnership for the Alprox-TD(R) cream but we cannot
assure you that we will be able to conclude an arrangement on a timely basis, if
at all, or on terms acceptable to us. With our current cash reserves, we may
elect to proceed with our Phase III program on the Alprox-TD(R) cream, assuming
we receive FDA concurrence, while concurrently pursuing these discussions; and
(ii) the Viratrol(R) device, a therapeutic medical device for the
treatment of herpes simplex diseases without the use of drugs. We believe that
the minute electrical current, which is topically delivered by the device to an
infected site, may block lesions from forming or may significantly shorten
healing time once lesions develop. We are in the process of completing the
commercial product design of the Viratrol(R) herpes treatment device for the
U.S. market, and we intend to initiate its proposed Phase II/III study in the
first half of 2001.
DEVELOPMENT OF TOPICAL TREATMENT PRODUCTS
The NexACT(R) transdermal drug delivery technology is designed to enhance
absorption of an active drug through the skin, overcoming the skin's natural
barrier properties and enabling high concentrations of the active drug to
rapidly penetrate the desired site of the skin or extremity. Successful
application of the NexACT(R) technology would improve therapeutic outcomes and
reduce gastrointestinal or other systemic side effects that often accompany oral
medications. We intend to continue our efforts developing topical treatments
based on the application of NexACT(R) technology to drugs: (1) previously
approved by the FDA, (2) with proven efficacy and safety profiles, (3) with
patents expiring or expired and (4) with proven market track records and
potential. In furtherance of these efforts and through at least August 31, 2001,
we will continue to use laboratory space at the Higuchi Biosciences Center of
the University of Kansas pursuant to a research agreement with the University.
We have retained advisors, consultants and employees at the Higuchi Biosciences
Center to assist with our development efforts.
NEXACT(R) PRODUCTS UNDER DEVELOPMENT
We are currently focusing research and development efforts on the following
leading candidates for topical treatment products:
(1) Alprox-TD(R) is an alprostadil-based topical treatment cream intended
to treat mild to moderate ED. Our clinical studies have demonstrated
that NexACT(R) enhancers may promote the absorption of alprostadil and
improve clinical responses. In February 1998, we completed a
sixty-patient (30 male and 30 female) Phase I study on the Alprox-TD(R)
cream in the United States. In October 1999, we completed the pre-Phase
II toxicology studies in the United States. In December 1999, we
initiated the U.S. Phase II clinical program to determine the efficacy
of the Alprox-TD(R) cream and to expand the safety and efficacy data in
humans and in September 2000 we
6
<PAGE>
submitted the Phase II test results to the FDA. The U.S. Phase II
clinical program, conducted at 12 clinical sites in the U.S., was
randomized, parallel, double-blind, placebo-controlled, and designed to
investigate the dose-response relationships of the efficacy and safety
of 3 different doses of Alprox-TD(R) versus a placebo in 161 men with
mild to moderate ED. The patients were required to apply up to 10 doses
at home over a nine-week period and keep a daily diary. The Phase II
study results indicated that three different dose levels of
Alprox-TD(R) were shown to be effective over placebo in sexual function
endpoint analyses, with the highest dose showing a highly significant
(p=0.001) increase in Erectile Function Domain scores under the
International Index of Erectile Function ("IIEF"), which is the primary
efficacy endpoint for the assessment of ED. The response to the Global
Assessment Questionnaire, which measures improvement in erectile
function, indicated an efficacy rate of 73% in the highest dose group
compared to 23% in the placebo group. Other secondary efficacy
endpoints also showed statistically significant improvements when the
highest dose was compared with the placebo. Overall, the vast majority
of the side-effects observed in the study were mild in nature and
consisted of a transient burning sensation at the application site. In
China, NexMed Pharmaceuticals (Zhongshan) Ltd., a subsidiary of our
Asian licensee, completed four Phase III double blind and open label
clinical studies that evaluated a total of 356 men, and has submitted,
a "New Drug Application" to the China State Drug Administration for
approval to distribute the product in China.
(2) Femprox(TM) is an alprostadil-based cream product intended for the
treatment of FSAD. We completed in 1998, an eight-patient Phase I
clinical study for safety and efficacy. Results from our clinical study
demonstrated a positive effect on increasing blood flow to the clitoris
and labia in the subjects tested. No systemic side effects were
evidenced and local side effects were minimal. Subject to FDA
concurrence, we intend to initiate the proposed U.S. Phase II program
for Femprox(TM) in the first quarter of 2001.
We have five U.S. patents either acquired or received out of a series of
patent applications that we have filed in connection with our continuing
development of a new generation of skin absorption technology based on the
NexACT(R) technology and our NexACT(R)-based products under development, such as
Alprox-TD(R) and Femprox(TM). To further strengthen our global patent position
on Alprox-TD(R) and Femprox(TM) and to expand the patent protection to other
markets, we have filed under the Patent Cooperation Treaty, corresponding
international applications for our issued and pending U.S. patents.
ADVISORS, CONSULTANTS, RESEARCHERS AND EMPLOYEES IN THE ABSORPTION ENHANCEMENT
FIELD
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We currently employ Dr. Servet Buyuktimkin as Director of Drug Delivery
Research and Dr. Nadir Buyuktimkin as Director of Formulation Research to
conduct research at our laboratories at the Higuchi Biosciences Center of the
University of Kansas. Dr. Servet Buyuktimkin and Dr. Nadir Buyuktimkin are
co-developers and authors of several publications and presentations relating to
our NexACT(R) enhancers. Dr. J. Howard Rytting, a co-developer of the NexACT(R)
enhancers and professor in the Department of Pharmaceutical Chemistry of the
School of Pharmacy of the University of Kansas, is a member of our Scientific
Advisory Board. Pursuant to a research agreement with the University of Kansas,
we are funding Dr. Rytting's research efforts to develop new methodologies
involving penetration enhancement research. Although the university would own
any patents resulting from such efforts, we have the right to exclusively
license any technology resulting from such efforts.
VIRATROL(R) HERPES TREATMENT DEVICE
The Viratrol(R) device is a hand-held non-invasive therapeutic device
designed to treat herpes simplex diseases. The device topically delivers a
minute electrical current to an infected site and may block lesions from forming
and/or shorten healing time once lesions develop. We have allocated sufficient
funds for finalizing the product design for marketing in the United States, and
for initiating the proposed Phase II/III clinical study in the first half of
2001.
We have three U.S. patents issued on the Viratrol(R) device, and one patent
application pending with respect to the technology, inventions and improvements
that are significant to the Viratrol(R) device and intend to file additional
patent applications to continue expanding the coverage on the device.
Internationally, we have filed under the Patent Cooperation Treaty,
corresponding international applications for our issued patents and pending U.S.
patent application.
POTENTIAL CORPORATE ALLIANCES
We are currently considering potential strategic partnerships relating to
our proprietary products under development with various United States and
international pharmaceutical and medical companies. Such a partnership may be
for co-development or co-marketing, or both. In any event it is our present
intention to maintain manufacturing rights for our products based on the
NexACT(R) Technology. We are hopeful, but cannot assure you, that we will
consummate one or more definitive agreements establishing a strategic corporate
alliance.
In Asia, our subsidiary NexMed International Limited and Vergemont
International Limited entered into a license agreement in 1999 pursuant to which
(1) Vergemont International Limited has an exclusive right to manufacture and to
market in China and Asian Pacific countries, our Alprox-TD(R), Femprox(TM) and
three other of our proprietary products under development, and (2) we will
receive a royalty on sales and supply, on a cost plus basis, the NexACT(R)
enhancers that are essential in the formulation and production of our
proprietary topical products. Under the term of our subsidiary's agreement with
Vergemont International Limited, Dr. Joseph Mo, our President and Chief
Executive Officer, has actively assisted in the anticipated launch
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of our proprietary ED treatment in China which will be marketed under the name
"Befar."
MANUFACTURING.
In October 2000, we completed the purchase of a 31,500 square foot
manufacturing facility, located in East Windsor, New Jersey. The facility, which
has been designed to meet our specific manufacturing needs and will be utilized
initially to manufacture Alprox-TD(R) and Femprox(TM) for continuing clinical
testing purposes, is currently being retrofitted for Good Manufacturing Practice
compliance as required by the FDA.
COMPANY HISTORY.
We were organized under the laws of the state of Nevada in October 1987
under the name Target Capital, Inc. We raised initial funds as a blind pool.
Because our early business plans were not productive, we became inactive until
early 1994 and our records prior to 1994 are not complete. In 1994, we changed
our name to BioElectric, Inc and in 1995, we changed our name to NexMed, Inc. to
reflect our broader-based business objectives.
RISK FACTORS
The securities offered hereby are speculative and involve a high degree of
risk. Only those persons who are able to lose their entire investment should
purchase these securities. You should carefully consider the following risk
factors and other information in this prospectus before deciding to invest in
our Common Stock.
WE HAVE INCURRED AND WILL CONTINUE TO INCUR OPERATING LOSSES. Our current
business operations began in 1994 and we have a limited operating history. We
may encounter delays, uncertainties and complications typically encountered by
development stage businesses. We have not marketed or generated revenues from
our products under development. We are not profitable and have incurred
significant operating losses since our inception, and we have an accumulated
deficit of $21,001,056 through September 30, 2000. Even if we eventually
generate revenues from sales of our products currently under development, we
expect to incur significant operating losses over the next several years. Our
ability to become profitable will depend, among other things, on our (1)
development of our proposed products, (2) obtaining of regulatory approvals of
our proposed products on a timely basis and (3) success in manufacturing,
distributing and marketing our proposed products.
OUR PROPOSED PRODUCTS ARE IN THE DEVELOPMENT STAGE AND MAY FAIL. We intend
to focus our current development efforts on the Alprox-TD(R) and Femprox(TM)
creams utilizing the NexACT(R) technology as well as on the Viratrol(R) device.
We have not begun to generate revenues from any of our proposed products and
there can be no assurance that we ever will. We have completed the testing of
190 patients under our Phase II clinical program on the Alprox-TD(R) cream and
have submitted the Phase II trial data to the FDA for review. Subject to FDA
concurrence, we intend to initiate Phase III clinical trials for Alprox-TD(R)
in the first quarter of 2001. However, there can be no
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assurance that the data collected from the Phase II clinical studies of the
Alprox-TD(R) cream will be sufficient to enable us to initiate Phase III
clinical trials or that the FDA will agree with our interpretation of our future
clinical trial results. In the first quarter of 2001, we anticipate the
commencement of Phase II clinical trials in the United States of the Femprox(TM)
cream. In the first half of 2001, we anticipate the commencement of the Phase II
clinical trials in the United States of the Viratrol(R) device.
We cannot assure you that the clinical trials will be completed on
schedule, or that the FDA will ultimately approve our product under development
for commercial sale. Furthermore, even if the results of our clinical trials are
initially positive, it is possible that we will obtain different results in the
later stages of drug development. Drugs in late stages of clinical development
may fail to show the desired safety and efficacy traits despite having
progressed through initial clinical testing. For example, positive results in
early Phase I or Phase II clinical trials may not be repeated in larger Phase II
or Phase III clinical trials.
Our proposed products are subject to the risks of failure associated with
the establishment and development of products based upon innovative or novel
technologies. Among these risks are the following:
o research and development activities we fund may not be successful;
o our products under development may not prove to be safe and effective;
o we may not complete our clinical development work;
o we may not obtain FDA or foreign regulatory approvals of our products;
o our products may not be commercially viable or successfully marketed;
o third parties may hold proprietary rights that could preclude us from
marketing our products; and
o we may never achieve significant revenues from our products under
development even if the FDA or foreign authorities approve them.
OUR FAILURE TO RECEIVE GOVERNMENTAL APPROVALS FOR OUR PROPOSED PRODUCTS ON
A TIMELY BASIS, OR EVER, COULD DAMAGE OUR BUSINESS, FINANCIAL CONDITION AND
RESULTS OF OPERATIONS. Governmental authorities in the United States and other
countries heavily regulate the testing, manufacture, labeling, distribution,
advertising and marketing of our proposed products. The Alprox-TD(R) and
Femprox(TM) creams utilizing the NexACT(R) technology as well as the Viratrol(R)
device have not been approved for marketing in the United States. Before we
market any products we develop, we must obtain FDA and comparable foreign agency
approval through an extensive clinical study and approval process.
The studies involved in the approval process are conducted in three
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<PAGE>
phases. In Phase I studies, researchers assess safety or the most common acute
adverse effects of a drug and examine the size of doses that patients can take
safely without a high incidence of side effects. Generally, 20 to 100 healthy
volunteers or patients are studied in the Phase I study for a period of several
months. In Phase II studies, researchers determine the drug's efficacy with
short-term safety by administering the drug to subjects who have the condition
the drug is intended to treat, assess whether the drug favorably effects the
condition, and begin to identify the correct dosage level. Up to several hundred
subjects may be studied in the Phase II study for approximately 6 to 12 months,
depending on the type of product tested. In Phase III studies, researchers
further assess efficacy and safety of the drug. Several hundreds to thousands of
patients may be studied during the Phase III studies for a period of from 12
months to several years. Upon completion of Phase III studies, a New Drug
Application is submitted to the FDA or foreign governmental regulatory authority
for review and approval.
Our failure to obtain requisite governmental approvals timely or at all
will delay or preclude us from licensing or marketing our products or limit the
commercial use of our products, which could adversely affect our business,
financial condition and results of operations.
VARIATIONS IN THE REGULATORY REQUIREMENTS OF FOREIGN AUTHORITIES COULD
DELAY OUR INTRODUCTION OF PRODUCTS INTO COUNTRIES OUTSIDE THE UNITED STATES AND
LIMIT OUR MARKETING SCOPE. Because we intend to sell and market our products
outside the United States, we will be subject to foreign regulatory requirements
governing the conduct of clinical trials, product licensing, pricing and
reimbursements. These requirements vary widely from country to country. Our
failure to meet each foreign country's requirements could delay our introduction
of our proposed products in the respective foreign country and limit our
revenues from sales of our proposed products in foreign markets.
OUR FAILURE TO COMPLY WITH REGULATORY REQUIREMENTS COULD SUBJECT US TO
REGULATORY OR ENFORCEMENT ACTIONS. Even if we obtain regulatory approvals, the
FDA and comparable foreign agencies continually review and regulate marketed
products. A later discovery of previously unknown problems or our failure to
comply with the applicable regulatory requirements could subject us to
regulatory or judicial enforcement actions. These actions could result in the
following:
o recalls or seizures of our proposed products,
o restrictions on marketing of our proposed products,
o regulatory authorities' refusal to approve new products or withdrawal
of existing approvals,
o enhanced product liability exposure,
o injunctions,
o civil penalties, or
o criminal prosecution.
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WE NEED, BUT MAY BE UNABLE TO RAISE, ADDITIONAL FUNDS TO CONTINUE OUR
OPERATIONS. We believe that our current cash and cash equivalents are sufficient
to (i) complete our proposed Alprox-TD(R) Phase III clinical study, the Phase II
clinical studies on our Femprox(TM) cream and our proposed Phase II/III clinical
study on the Viratrol(R) device, and (ii) support during the next twelve months
our continuing operational requirements and the retrofitting of our New Jersey
manufacturing facility. However, absent our entering into a strategic
partnership or similar arrangement, or obtaining significant additional external
funding, we do not anticipate that we will have sufficient funds to commence the
sale or launch of our products currently under development or to market them
adequately. Consequently, we will require additional funding, which may include
entering into strategic partnerships, to complete the clinical development of
our products and/or to market them. Our cash requirements may vary depending
upon:
o the progress of our clinical development programs, and
o the timing of and response to our regulatory submissions.
Although we expect to raise more funds from the exercise of outstanding
warrants and outstanding options as well as through potential strategic
partnerships and/or additional debt or equity financing, we have not made
arrangements for, and may not be able to obtain, additional external financing
on acceptable terms, or at all. If we cannot obtain such additional financing,
we may need to modify our business objectives or reduce or cease certain or all
of our product development programs and other operations.
WE MAY NEED BUT BE UNABLE TO ATTRACT AND RETAIN ONE OR MORE STRATEGIC
PARTNERS TO DEVELOP OUR POTENTIAL PRODUCTS. With the exception of the completion
of our clinical development for the Alprox-TD(R) cream, which we expect to
self-fund, successful development and commercialization of our technologies and
products may depend largely on our ability to establish relationships with
multinational strategic partners, given the high cost of funding clinical trials
and of bringing proposed products through the governmental approval process to
the commercial market. We do not currently have a strategic partner relationship
with respect to any of our technologies or potential products. We may not be
able to establish these relationships on favorable terms, if at all.
WE LACK MARKETING AND DISTRIBUTION EXPERTISE AND WILL DEPEND ON THIRD
PARTIES TO MARKET AND DISTRIBUTE OUR PRODUCTS. Our products will require
substantial marketing efforts to achieve market acceptance. Our operating
results and long term success will depend on our ability to establish successful
strategic partnerships with domestic and international partners to distribute
and market our products.
WE DEPEND ON PATENTS, TRADEMARKS, LICENSES AND PROPRIETARY RIGHTS TO
PROTECT US AGAINST COMPETITORS. We have and will continue to seek proprietary
protection for our products to attempt to prevent others from commercializing
equivalent products in substantially less time and at substantially lower
expense. Our success may depend on our ability to (1)
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<PAGE>
obtain effective patent protection within the United States and internationally
for our proprietary technologies and products, (2) defend patents we own, (3)
preserve our trade secrets, and (4) operate without infringing upon the
proprietary rights of others.
Patents, trademarks, licenses and other proprietary rights may not fully
protect us. While we have obtained patents and have several patent applications
pending, the extent of effective patent protection in the United States and
other countries is highly uncertain and involves complex legal and factual
questions. No consistent policy addresses the breadth of claims allowed in or
the degree of protection afforded under patents of medical and pharmaceutical
companies. Patents we currently own or may obtain might not be sufficiently
broad to protect us against competitors with similar technology. Any of our
patents could be invalidated or circumvented.
Our patent applications may not be approved on a timely basis or ever. The
patent application and issuance process takes years, and may be expensive. We
might not obtain all of the United States patents we have applied for related to
the Viratrol(R) device, the Alprox-TD(R) and Femprox(TM) creams, NexACT(R) or
other technology or products that we may develop. In addition, we do not have
and may never obtain foreign patents equivalent to the claims in our U.S.
patents.
Our commercial success may depend upon our avoidance of infringement of
patents issued to competitors. Because a United States pending patent
application is confidential, we cannot know the inventions claimed in pending
patent applications filed by third parties. We may need to defend or enforce our
patent and license rights or determine the scope and validity of the proprietary
rights of others through litigation. Defense and enforcement of patent claims
may be expensive and time-consuming, even when the outcome is in our favor.
Defense and enforcement actions may use substantial resources originally
allocated to other activities such as studies and continuing development of our
products and technologies. There have been patents issued to others such as
Vivus, Inc. and MacroChem Corporation on the use of prostaglandin for the
treatment of male or female sexual dysfunction. While we believe that our
patents will prevail in any potential litigation, we can provide no assurance
that the holders of these competing patents will not commence a lawsuit against
us or that we will prevail in any such lawsuit. In the event of an unfavorable
outcome in such a suit or any other patent infringement suit, we may be required
to:
o assume significant liabilities to third parties,
o obtain licenses from third parties,
o alter our products or processes, or
o cease altogether any of our related research and development activities
or product sales.
We rely on agreements with third parties to protect our rights to certain
technology. We may encounter disputes regarding the proprietary rights to
technological information that employees, consultants, advisors or other third
parties independently develop and apply to any of our proposed
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<PAGE>
products. These disputes might not be resolved in our favor. We may also rely on
trade secrets and proprietary know-how that may become known to others despite
our efforts to keep them confidential. Although we seek to protect our trade
secrets and proprietary know-how in part by our confidentiality agreements with
employees, consultants, advisors or others, these parties may breach their
agreements, and we might not obtain adequate remedies. Similarly, competitors
may discover or independently develop our trade secrets or proprietary know-how
in such a manner that we have no legal recourse.
OUR ABILITY TO MANUFACTURE OUR PRODUCTS MAY INCLUDE DEPENDENCE ON
THIRD-PARTY MANUFACTURERS AS WELL AS SUPPLIERS. In the event our production
requirements exceed the capacity of our new manufacturing facility in East
Windsor, New Jersey, which is currently being retrofitted for Good Manufacturing
Practice compliance as required by the FDA, we will need to rely on third-party
manufacturers to fulfill our production needs. To be successful, we and/or the
manufacturers to whom we outsource must produce our products in commercial
quantities at acceptable costs and in compliance with regulatory requirements of
the FDA or comparable foreign agencies. The FDA periodically inspects
manufacturing facilities within the United States and manufacturing facilities
outside the United States whose drugs are marketed in the United States. Our
failure or the failure of third-party suppliers or manufacturers of our proposed
products to meet good manufacturing practice standards and comply with FDA or
foreign regulatory requirements would adversely affect our financial condition
and operating results.
HEALTHCARE REIMBURSEMENT POLICIES AND REFORM MAY CAUSE UNCERTAINTY OF
PRODUCT PRICING AND REIMBURSEMENT. Successful commercialization of our products
may depend on the availability of reimbursement to the consumer from third-party
healthcare payers, such as government and private insurance plans. Even if we
succeed in bringing one or more products to market, reimbursement to consumers
may not be available or sufficient to allow us to realize an appropriate return
on our investment in product development or to sell our products on a
competitive basis. In addition, in certain foreign markets, pricing or
profitability of prescription pharmaceuticals is subject to governmental
controls. In the United States, federal and state agencies have proposed similar
governmental control and the United States Congress has recently considered
legislative and regulatory reforms that may affect companies engaged in the
healthcare industry. Pricing constraints on our products in foreign markets and
possibly the United States, could adversely effect our business.
WE DEPEND ON KEY PERSONNEL AND CONSULTANTS WHOSE CONTINUED SERVICE IS NOT
GUARANTEED. We depend on our officers and directors, Scientific Advisory Board
members, consultants and collaborating scientists, including Y. Joseph Mo,
Ph.D., Chairman of our Board of Directors, President and Chief Executive
Officer; James L. Yeager, Ph.D., Vice President, Research and Development and
Business Development, and director; and Vivian H. Liu, Chief Financial Officer,
Vice President, Corporate Affairs and Secretary. Loss of their services could
adversely affect our business. We may not be able to attract and retain
additional management or other key personnel capable of developing our proposed
products.
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<PAGE>
THE MEDICAL AND PHARMACEUTICAL INDUSTRY IS HIGHLY COMPETITIVE AND MANY OF
OUR POTENTIAL COMPETITORS HAVE GREATER FINANCIAL AND TECHNOLOGICAL RESOURCES. We
are engaged in a highly competitive industry. We expect increased competition
from numerous existing companies, including large international enterprises, and
others entering the industry. Most of these companies have greater research and
development, manufacturing, marketing, financial, technological, personnel and
managerial resources. Acquisitions of competing companies by large
pharmaceutical or healthcare companies could further enhance such competitors'
financial, marketing and other resources. Competitors may complete clinical
trials, obtain regulatory approvals and commence commercial sales of their
products before we could enjoy a significant competitive advantage. Products
developed by our competitors may be more effective than our products.
Certain treatments for ED, such as needle injection therapy, vacuum
constriction devices, penile implants, transurethral absorption and oral
medications, currently exist, have been approved for sale in certain markets and
are being improved. Currently known products for the treatment of ED developed
or under development by our competitors include the following: (1) Caverject(R),
Pharmacia & Upjohn Company's needle injection therapy; (2) Viagra(R), Pfizer,
Inc.'s product to treat ED that was approved by the FDA in March 1998 and
currently has annual sales exceeding one billion dollars; and (3) MUSE(R),
Vivus, Inc.'s device for intra-urethral delivery of a suppository containing
alprostadil, which have each been approved for sale in the U.S. and several
international markets. In addition, the following products are currently under
development: (1) Topiglan(R), a topical treatment containing alprostadil based
on a proprietary drug delivery system under development by MacroChem
Corporation; (2) Vasomax(R), an oral medication to be marketed through a
collaborative effort of Zonagen, Inc. and Schering Plough Pharmaceuticals; (3)
IC351, an oral formulation under development by the joint venture between ICOS
and Eli Lilly & Co; (4) Uprima(R), an oral medication to be marketed by TAP
Pharmaceuticals, a joint venture between Takeda Pharmaceuticals Japan and Abbott
Laboratories; (5) Max-K(R), an oral medication by Bristol-Meyers Squibb; and (6)
Vardenafil, an oral medication by Bayer AG.
Improvements may also be made to the existing alternatives to our products
and newer technologies and products may emerge, which could render our products
less desirable or obsolete. If the market fails to develop or develops more
slowly than we anticipate, we may be unable to recover the losses we will have
incurred to develop our products and may never be able to achieve profitability.
WE DO NOT EXPECT TO PAY DIVIDENDS ON OUR COMMON STOCK IN THE FORESEEABLE
FUTURE. Although our shareholders may receive dividends if, as and when declared
by our board of directors, we do not intend to pay dividends on our Common Stock
in the foreseeable future. Therefore, you should not purchase our Common Stock
if you need immediate or future income by way of dividends from your investment.
WE MAY ISSUE ADDITIONAL SHARES OF OUR CAPITAL STOCK THAT COULD DILUTE THE
VALUE OF YOUR SHARES OF COMMON STOCK. We are authorized to issue 90,000,000
shares of our capital stock, consisting of 80,000,000 shares of our Common Stock
and 10,000,000 shares of our preferred stock of which
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<PAGE>
1,000,000 is designated as Series A Junior Participating Preferred Stock. At
January 11, 2001, 25,147,104 shares of our Common Stock and no shares of our
preferred stock were issued and outstanding, and 4,607,434 shares of our Common
Stock were issuable upon the exercise of options and/or warrants (including the
warrants held by the selling shareholders).
We may also issue authorized and unissued shares of Common Stock or
preferred stock that could dilute the earnings per share and book value of your
shares of our Common Stock.
THE PRICE OF OUR COMMON STOCK HAS BEEN VOLATILE. For example, from January
1, 2000 to December 31, 2000 our Common Stock has traded as high as $23.50 per
share and as low as $3.4375 per share. The price of our Common Stock is likely
to continue to be volatile due to a number of factors, including:
o the results of clinical testing of our products;
o the introduction of new products by us or by our competitors;
o market conditions in the industry generally;
o additions or departures of key personnel; and
o general economic conditions
OUR COMMON STOCK IS CURRENTLY QUOTED ON THE NASDAQ NATIONAL MARKET SYSTEM.
To continue to be listed on the Nasdaq National Market System, we must maintain
certain requirements. If we fail to satisfy one or more of the requirements, our
Common Stock may be delisted. If our Common Stock is delisted, and does not
become listed on another stock exchange, then it will be traded, if at all, in
the over-the-counter market commonly referred to as the NASD OTC Bulletin Board
and/or the "pink sheets." If this occurs, it may be more difficult for you to
sell our Common Stock.
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of the shares of
Common Stock offered by this prospectus. All proceeds from the sale of the
shares covered by this prospectus will be for the account of the selling
shareholders named herein. See "Selling Stockholders" and "Plan of
Distribution." However, assuming all of the warrants are exercised, we would
receive $100,000 in gross proceeds from those exercises.
INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
Our articles of incorporation and bylaws contain certain provisions to
indemnify our directors and officers against liability incurred by them as a
result of their services as directors and/or officers. We have been informed
that in the opinion of the Securities and Exchange Commission, our
indemnification of our directors, officers or controlling persons for
liabilities arising under the Securities Act of 1933, is against public
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<PAGE>
policy as expressed in the Securities Act, and therefore is unenforceable.
SELLING SHAREHOLDERS
The shares covered by this prospectus have been issued or will be issued
upon the exercise of warrants to purchase shares of Common Stock. The number of
shares of Common Stock that may be actually sold by the selling shareholders
will be determined by such selling shareholders.
The selling shareholders are the persons and/or entities listed in the
table below who own our Common Stock, or warrants to purchase shares of our
Common Stock. We are registering for the 18 selling shareholders named herein,
an aggregate of 3,625,091 shares of Common Stock. Except as noted below, none of
the selling shareholders has, or within the past three years has had, any
relationship, position, or office with us or our affiliates.
The following table sets forth, as of January 11, 2001: (1) the name of
each selling shareholder, (2) the number of shares of our Common Stock
beneficially owned by each selling shareholder, including the number of shares
purchasable upon exercise of warrants, (3) the maximum number of shares of
Common Stock which the selling shareholders can sell pursuant to this prospectus
and (4) the number of shares of Common Stock that the selling shareholders would
own if they sold all their shares registered by this prospectus. Each selling
shareholder will receive all of the net proceeds from the sale of his or her
shares of Common Stock offered by this prospectus.
Because the selling shareholders may sell all or part of their shares
of Common Stock pursuant to this prospectus and this offering is not being
underwritten on a firm commitment basis, we cannot estimate the number and
percentage of shares of Common Stock that the selling shareholders will hold as
a group at the end of the offering covered by this prospectus.
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------
NAME OF SELLING SHAREHOLDER NUMBER OF SHARES NUMBER OF SHARES NUMBER OF SHARES OF
OF COMMON STOCK OF COMMON STOCK COMMON STOCK TO BE
OWNED BEFORE BEING REGISTERED OWNED AFTER THIS
OFFERING (1) BY THIS PROSPECTUS OFFERING (2) (4)
---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Berg, Christopher H. Revocable Trust 70,000 70,000 0
---------------------------------------------------------------------------------------------------------------------
Clarion Capital Corporation 141,699 141,699 0
---------------------------------------------------------------------------------------------------------------------
Clarion Offshore Fund 63,901 63,901 0
---------------------------------------------------------------------------------------------------------------------
Duck, Charles, Jr. 105,000 60,000 45,000
---------------------------------------------------------------------------------------------------------------------
Feinstein, Jacob TTEE F/T 100,002 100,002 0
Jacob & Gloria Feinstein
Rev. Trust A DTD 9/18/92
---------------------------------------------------------------------------------------------------------------------
Gaston, Robert 49,998 49,998 0
---------------------------------------------------------------------------------------------------------------------
Gelman, Marc A. and Ingrid E. Joint Tenants 49,998 49,998 0
---------------------------------------------------------------------------------------------------------------------
Lee, Daniel T.C. 130,166 99,999 30,167
---------------------------------------------------------------------------------------------------------------------
Hillsman, John 69,998 69,998 0
---------------------------------------------------------------------------------------------------------------------
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<PAGE>
---------------------------------------------------------------------------------------------------------------------
Pryor Cashman Sherman & Flynn LLP (3) 100,000 100,000 0
---------------------------------------------------------------------------------------------------------------------
Qureishi, A. Salam 210,000 210,000 0
---------------------------------------------------------------------------------------------------------------------
Qureishi, Lubina F. Leila 51,000 51,000 0
---------------------------------------------------------------------------------------------------------------------
Sacks-Rick, Deborah 13,998 13,998 0
---------------------------------------------------------------------------------------------------------------------
Sacks, Francis E. 6,498 6,498 0
---------------------------------------------------------------------------------------------------------------------
Sacks, Selig D. (5) 88,000 88,000 0
---------------------------------------------------------------------------------------------------------------------
Van, Winston 150,000 150,000 0
---------------------------------------------------------------------------------------------------------------------
Vergemont International Limited dba NexMed 2,000,000 2,000,000 0
Asian Pacific Limited
---------------------------------------------------------------------------------------------------------------------
Wellchamp Investments Ltd. 300,000 300,000 0
---------------------------------------------------------------------------------------------------------------------
Total 3,700,258 3,625,091 75,167
---------------------------------------------------------------------------------------------------------------------
</TABLE>
------------------
(1) Includes shares of Common Stock and shares issuable upon the exercise of
warrants to purchase Common Stock. Excludes 280,500 shares of Common
Stock issued and issuable upon the exercise of warrants purchased by 4 of
the selling shareholders named herein in our July and August 2000 private
placement. The resale of these shares was registered in our Registration
Statement on Form S-3 (File No. 333-46976), dated September 29, 2000
(2) Assumes all shares of Common Stock registered by this prospectus are
sold. As to the 4 selling shareholders referred to in the footnote above,
also assumes all shares of Common Stock issued and issuable upon the
exercise of warrants purchased in our July and August 2000 private
placement are sold.
(3) Pryor Cashman Sherman & Flynn LLP, is formerly our legal counsel.
(4) Assuming all shares of Common Stock registered by this prospectus are
sold, none of the selling shareholders named herein will own greater than
one percent of our Common Stock. Percentage of shares owned is based on
25,147,104 shares of our Common Stock issued and outstanding as of
January 11, 2001, and 100,000 shares of our Common Stock issuable upon
the exercise of warrants held by selling shareholders named in this
prospectus.
(5) Selig D. Sacks, is a partner of Pryor Cashman Sherman & Flynn LLP,
formerly our legal counsel.
PLAN OF DISTRIBUTION
The selling shareholders may from time to time offer and sell their shares
of Common Stock offered by this prospectus. We have registered their shares for
resale to provide them with freely tradable securities. However, registration
does not necessarily mean that they will offer and sell any of their shares.
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<PAGE>
OFFER AND SALE OF SHARES
The selling shareholders, or their pledgees, donees, transferees or other
successors in interest, may offer and sell their shares of Common Stock in the
following manner:
o in the over-the-counter market or otherwise at prices and at terms then
prevailing or at prices related to the then current market price; or
o in privately negotiated transactions.
The selling shareholders, or their pledgees, donees, transferees or other
successors in interest, may sell their shares of Common Stock in one or more of
the following transactions:
o a block trade in which the broker or dealer so engaged will attempt to
sell the shares as agent, but may position and resell a portion of the
block as principal to facilitate the transaction;
o a broker or dealer may purchase as principal and resell such shares for
its own account pursuant to this prospectus;
o an exchange distribution in accordance with the rules of the exchange;
and
o ordinary brokerage transactions and transactions in which the broker
solicits purchasers.
SELLING THROUGH BROKERS AND DEALERS
The selling shareholders may select brokers or dealers to sell their shares
of Common Stock. Brokers or dealers that the selling shareholders engage may
arrange for other brokers or dealers to participate in selling such shares. The
selling shareholders may give such brokers or dealers commissions or discounts
in amounts to be negotiated immediately before any sale. In connection with such
sales, these brokers or dealers, any other participating brokers or dealers, and
certain pledgees, donees, transferees and other successors in interest, may be
deemed to be "underwriters" within the meaning of Section 2(11) of the
Securities Act of 1933. In addition, any securities covered by this prospectus
that qualify for sale pursuant to Rule 144 of the Securities Act of 1933 may be
sold under such rule rather than pursuant to this prospectus.
SUPPLEMENTAL PROSPECTUS REGARDING MATERIAL ARRANGEMENTS
If and when a selling shareholder notifies us that he, she or it has
entered into a material arrangement with a broker or dealer for the sale of his,
her or its shares of Common Stock offered by this prospectus through a block
trade, special offering, exchange or secondary distribution or a purchase by a
broker or dealer, we will file a supplemental prospectus, if required, pursuant
to Rule 424(c) under the Securities Act of 1933.
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<PAGE>
EXPENSES OF SELLING SHAREHOLDERS
The selling shareholders may engage brokers or dealers who may receive
commissions or discounts from the selling shareholders. While we will pay
substantially all of the expenses incident to the registration of the selling
shareholders' shares, we will not be responsible for discounts or commissions
paid to such brokers or dealers.
COMPLIANCE WITH STATE SECURITIES LAWS
We have not registered or qualified the shares of Common Stock offered by
this prospectus under the laws of any country, other than the United States. In
certain states, the selling shareholders may not offer or sell their shares of
Common Stock unless (1) we have registered or qualified such shares for sale in
such states; or (2) we have complied with an available exemption from
registration or qualification. Also, in certain states, to comply with such
states' securities laws, the selling shareholders can offer and sell their
shares of Common Stock only through registered or licensed brokers or dealers.
LIMITATIONS IMPOSED BY EXCHANGE ACT OF 1934 RULES AND REGULATIONS
Certain provisions of the Securities Exchange Act of 1934, as amended, and
the related rules and regulations will apply to the selling shareholders and any
other person engaged in a distribution of shares of the Common Stock. Such
provisions may (1) limit the timing of purchases and sales of any of the shares
of Common Stock by the selling shareholders or such other person; (2) affect the
marketability of such stock; and (3) affect the brokers' and dealers'
market-making activities with respect to such stock.
LEGAL MATTERS
Pryor Cashman Sherman & Flynn LLP, New York, New York, has issued an
opinion to us regarding certain legal matters in connection with this offering,
including the validity of the issuance of the shares of Common Stock offered by
this prospectus.
EXPERTS
The financial statements incorporated in this prospectus by reference to
our Annual Report on Form 10-KSB for the year ended December 31, 1999, have been
so incorporated in reliance on the report of PricewaterhouseCoopers LLP,
independent accountants, given on the authority of said firm as experts in
auditing and accounting.
20
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--------------------------------------------------------------------------------
NEXMED, INC.
3,625,091 SHARES
COMMON STOCK
--------------------------
PROSPECTUS
--------------------------
, 2001
--------------------------------------------------------------------------------
<PAGE>
PART II
NEXMED CORPORATION
REGISTRATION STATEMENT ON FORM S-3
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Expenses to be paid by us, NexMed, Inc., in connection with the issuance
and distribution of the securities being registered are as follows:
Registration Fees $11,616.00
Legal Fees and Expenses 35,000.00*
Accounting Fees and Expenses 7,500.00*
Miscellaneous 5,884.00*
--------
Total $60,000.00
==========
------------------
*Estimated
The selling shareholders will pay none of the expenses incident to the
registration of the selling shareholders' shares, except for any selling
discounts or commissions paid to brokers or dealers engaged by the selling
shareholders.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Our officers and directors are indemnified under Nevada law, our Amended
and Restated Articles of Incorporation and our By-laws as against certain
liabilities. Our Amended and Restated Articles of Incorporation require us to
indemnify our directors and officers to the fullest extent permitted from time
to time by the laws of the State of Nevada. Our By-laws contain provisions that
implement the indemnification provisions of our Amended and Restated Articles of
Incorporation.
Pursuant to Article X of our Amended and Restated Articles of Incorporation
and to the extent permitted by the Nevada General Corporation Law, none of our
directors or officers shall be personally liable to us or our stockholders for
damages for breach of fiduciary duty as a director or officer, except for (1)
acts or omissions which involve intentional misconduct, fraud or a knowing
violation of law or (2) the payment of dividends in violation of the applicable
statues of Nevada. Pursuant to Article XI of our Amended and Restated Articles
of Incorporation, we shall indemnify any and all persons and their respective
heirs, administrators, successors, and assignees, who may serve at any time as
directors or officers or who at the request of our board of directors may serve
or, at any time, have served as directors or officers of another corporation in
which we at such time owned or may own shares of stock or which we were or may
be a creditor, against any and all expenses, including amounts paid upon
II-1
<PAGE>
judgments, counsel fees and amounts paid in settlement (before or after suit is
commenced), actually and reasonably incurred by such persons in connection with
the defense or settlement of any claim, action, suit or proceeding which may be
asserted against them or any of them, by reason of being or having been
directors or officers or a director or officer of us, or such other corporation.
However, no director or officer shall be indemnified and held harmless for
matters as to which any such director or officer or former director or officer
or person shall be adjudged in any action, suit or proceeding to be liable for
negligence or misconduct in the performance of his duty.
Pursuant to Section 8.1 of our By-laws, no officer or director shall be
personally liable for any obligations arising out of any of his or her acts or
conduct performed for or on our behalf. We shall indemnify and hold harmless
each person and his heirs and administrators who shall serve at any time as a
director or officer from and against any and all claims, judgments and
liabilities to which such persons shall become subject by any reason of his
having been a director of officer or by reason of any action alleged to have
been taken or omitted to have been taken by him as such director or officer, and
shall reimburse each such person for all legal and other expenses reasonably
incurred by him in connection with any such claim or liability, including power
to defend such person from all suits as provided for under the provisions of the
Nevada General Corporation Law; provided, however, that no such person shall be
indemnified against, or be reimbursed for, any expense incurred in connection
with any claim or liability arising out of his own negligence or willful
misconduct. We, our directors, officers, employees and agents shall be fully
protected in taking any action or making any payment or in refusing to do so in
reliance upon the advice of counsel.
Section 78.7502 of the Nevada General Corporation Law permits a corporation
to indemnify a present or former director, officer, employee or agent of the
corporation, or of another entity which such person is or was serving in such
capacity at the request of the corporation made a party to any threatened,
pending or completed action, suit or proceeding, except by action by or in the
right of the corporation, against expenses, including legal expenses, arising by
reason of service in such capacity if such person acted in good faith and in a
manner which he reasonably believed to be in or not opposed to the best interest
of the corporation and, with respect to a criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. In the case of actions
brought by or in the right of corporation, indemnification may be made if the
person acted in good faith and in a manner which he reasonably believed to be in
or not opposed to the best interests of the corporation; provided, however, that
no indemnification may be made for any claim, issue or matter as to which such
person has been adjudged by a court of competent jurisdiction, after exhaustion
of all appeals therefrom, to be liable to the corporation, unless and only to
the extent that the court in which the action or suit was brought or other court
of competent jurisdiction determines upon application that in view of all the
circumstances of the case, the person is fairly and reasonably entitled to
indemnity for such expenses as the court deems proper.
Section 78.751 of the Nevada General Corporation Law permits any
discretionary indemnification under Section 78.7502 of the Nevada General
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<PAGE>
Corporation Law, unless ordered by a court or advanced to a director or officer
by the corporation in accordance with the Nevada General Corporation Law,
authorized by determination that indemnification of the director, officer,
employee or agent is proper in the circumstances. The determination of
indemnification must be made (1) by the stockholders, (2) by the board of
directors by majority vote of a quorum consisting of directors who were not
parties to the action, suit or proceeding, (3) if a majority vote of a quorum
consisting of directors who were not parties to the action, suit or proceeding
so orders, by independent legal counsel in a written opinion, or (4) if a quorum
consisting of directors who were not parties to the actions, suit or proceeding
cannot be obtained, by independent legal counsel in a written opinion.
ITEM 16. EXHIBITS.
Exhibit Number Description
-------------- -----------
4.1 Form of Common Stock certificate(1)
5.1 Opinion of Pryor Cashman Sherman & Flynn LLP regarding the
validity of the Common Stock being registered(2)
23.1 Consent of Pryor Cashman Sherman & Flynn LLP
23.2 Consent of PricewaterhouseCoopers LLP
-----------------------
(1) Incorporated herein by reference to Exhibit 3.1 to our Registration
Statement on Form 10-SB (File No. 0-22245) filed with the Commission on March
14, 1997, including any amendment or report filed for the purpose of updating
such information.
(2) Previously filed with this Registration Statement on Form SB-2/A (File No.
333-91957) filed with the Commission on December 27, 1999.
Item 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(a) 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;
(ii) to reflect in the prospectus any facts or events arising after the
effective date of this Registration Statement (or its most recent post-effective
amendment) which, individually or in the aggregate, represent a fundamental
change in the information set forth in this Registration Statement.
Notwithstanding the foregoing, any increase or decrease in the 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 Securities and Exchange Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than a 20
percent change in the maximum aggregate offering
II-3
<PAGE>
price set forth in the "Calculation of Registration Fee" table in the effective
Registration Statement;
(iii) to include any material information with respect to the plan of
distribution not previously disclosed in this Registration Statement or any
material change to such information in this Registration Statement;
PROVIDED, HOWEVER, that the undertakings set forth in paragraphs (a)(i) and
(a)(ii) above do not apply if the information required with or furnished to the
Securities and Exchange Commission to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed with or furnished to
the Securities and Exchange Commission by the Registrant pursuant to Section 13
or Section 15(d) of the Exchange Act that are incorporated by reference in this
Registration Statement.
(b) That, for the purpose of determining any liability under the Securities
Act, 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.
(c) 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.
(d) That, for purposes of determining any liability under the Securities
Act, each filing of the Registrant's annual report pursuant to Section 13(a) or
15(d) of the Exchange Act that is incorporated by reference in this 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.
(e) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the provisions referred to in Item 15 of this
Registration Statement, or otherwise, the registrant has been advised 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. In the event that a claim for indemnification against such
liabilities (other than the payment by the registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
(f) (i) For the purposes of determining liability under the Securities Act,
the information omitted from the form of prospectus filed as part of this
Registration Statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the Registrant pursuant to Rule 424(b) (1) or (4)
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<PAGE>
or 497(h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared effective.
(ii) For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of prospectus shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial BONA FIDE offering thereof.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, we
certify that we have reasonable grounds to believe that we meet all the
requirements for filing on Form S-3 and have duly caused this Post Effective
Amendment No. 1 to Form SB-2/A on Form S-3 to be signed on our behalf by the
undersigned, thereunto duly authorized, in the City of Robbinsville, State of
New Jersey on this 11th day of January 2001.
NEXMED, INC.
By: /s/ Y. Joseph Mo
-----------------------------------
Y. Joseph Mo
Chairman of the
Board of Directors,
President and C.E.O.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Post Effective Amendment No. 1 to Form SB-2/A on Form S-3 has been signed
by the following persons in the capacities and on the dates indicated.
SIGNATURE TITLE DATE
--------- ----- ----
/s/ Y. Joseph Mo Chairman of the Board of January 11, 2001
-------------------------- Directors, President and
Y. JOSEPH MO C.E.O.
*
--------------------------
VIVIAN H. LIU Vice President, Chief January 11, 2001
Financial Officer and
Secretary
*
--------------------------
JAMES YEAGER Director, Vice- January 11, 2001
President, R&D and
Business Development
*
--------------------------
GILBERT S. BANKER Director January 11, 2001
*
--------------------------
ROBERT W. GRACY Director January 11, 2001
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<PAGE>
*
--------------------------
YU-CHUNG WEI Director January 11, 2001
By: /s/ Y. Joseph Mo January 11, 2001
--------------------------
Y. JOSEPH MO
(ATTORNEY-IN-FACT)
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<PAGE>
EXHIBIT INDEX
Exhibit Number Description
-------------- -----------
4.1 Form of Common Stock certificate(1)
5.1 Opinion of Pryor Cashman Sherman & Flynn LLP regarding the
validity of the Common
Stock being registered(2)
23.1 Consent of Pryor Cashman Sherman & Flynn LLP
23.2 Consent of PricewaterhouseCoopers LLP
---------------------
(1) Incorporated herein by reference to Exhibit 3.1 to our Registration
Statement on Form 10-SB (File No. 0-22245) filed with the Commission on March
14,1997, including any amendment or report filed for the purpose of updating
such information.
(2) Previously filed with this Registration Statement on Form SB-2/A (File No.
333-91957) filed with the Commission on December 27, 1999.
II-7
