<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20459
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED JUNE 30, 1997
COMMISSION FILE NUMBER 000-22347
ASCENT PEDIATRICS, INC.
(Exact name of registrant as specified in its charter)
Delaware 04-3047405
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification Number)
187 Ballardvale Street, Suite B125, Wilmington, MA 01887
(Address of principle executive offices) (Zip Code)
Registrant's telephone number, including area code (508) 658-2500
None
(Former name, former address, and
former fiscal year if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes No X
--- ---
Indicate the number of shares outstanding of the registrant's Common
Stock, par value $.00004 per share, as of August 11, 1997 was 6,890,050.
<PAGE> 2
ASCENT PEDIATRICS, INC.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Part I. Financial Information Page
Item 1 Condensed Financial Statements ----
<S> <C>
Condensed Balance Sheets........................................... 1
Condensed Statements of Operations................................. 2
Condensed Statements of Cash Flows................................. 3
Notes to Financial Statements...................................... 4 - 6
Item 2 Management's Discussion and Analysis of Financial Condition
and Results of Operations......................................... 7 - 9
Part II. Other Information.................................................. 10 - 11
Item 4 Submission of Matters to a Vote of Security-Holders
Signature................................................................... 12
Exhibit Index............................................................... 13
</TABLE>
<PAGE> 3
PART I. FINANCIAL INFORMATION
ITEM 1 FINANCIAL STATEMENTS
ASCENT PEDIATRICS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
June 30, December 31,
1997 1996
------------ ------------
<S> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents ...................................................................... $ 28,422,709 $ 2,085,743
Other current assets ........................................................................... 414,514 12,312
------------ ------------
Total current assets ........................................................................... 28,837,223 2,098,055
------------ ------------
Fixed assets, net .............................................................................. 409,851 163,142
Deposits related to acquisition ................................................................ 250,000 250,000
Deferred charges and other deposits ............................................................ 218,078 104,553
Debt issue costs, net (Note 4) ................................................................. 559,811 --
Other assets, net .............................................................................. 57,576 11,874
------------ ------------
Total assets .............................................................................. $ 30,332,539 $ 2,627,624
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities:
Accounts payable .......................................................................... $ 574,436 $ 496,655
Accrued expenses(Note 3) .................................................................. 1,477,170 1,076,556
------------ ------------
Total current liabilities ................................................................. 2,051,606 1,573,211
Subordinated secured notes (Note 4) ........................................................... 4,819,349 --
------------ ------------
Total liabilities ......................................................................... 6,870,955 1,573,211
Series D redeemable convertible preferred stock, $.00004 par value; 0 and 1,399,589 shares
authorized at June 30, 1997 and December 31, 1996, respectively; 1,359,522 shares issued
and outstanding at December 31, 1996 and 0 shares issued and outstanding
at June 30, 1997 .......................................................................... -- 8,157,132
Series E redeemable convertible preferred stock, $.00004 par value; 0 and 1,166,667 shares
authorized at June 30, 1997 and December 31, 1996, respectively; 733,371 shares issued
and outstanding at December 31, 1996 and 0 shares issued and outstanding at
June 30, 1997 ............................................................................. -- 4,400,226
Series F redeemable convertible preferred stock, $.00004 par value; 0 and 2,353,848 shares
authorized at June 30, 1997 and December 31, 1996, respectively; 811,536 shares issued
and outstanding at December 31, 1996 and 0 shares issued and outstanding at
June 30, 1997 ............................................................................. -- 5,274,984
Stockholders' Equity (Deficit):
Series A convertible preferred stock, $.00004 par value; 0 and 800,000 shares authorized
at June 30, 1997 and December 31, 1996, respectively; 800,000 shares issued and
outstanding at December 31, 1996 and 0 shares issued and outstanding at
June 30, 1997 .......................................................................... -- 280,110
Series B convertible preferred stock, $.00004 par value; 0 and 399,999 shares authorized
at June 30, 1997 and December 31, 1996, respectively; 399,999 shares issued and
outstanding at December 31, 1996 and 0 shares issued and outstanding at
June 30, 1997 .......................................................................... -- 2,574,993
Preferred Stock 5,000,000 shares authorized : 0 outstanding at June 30, 1997
Common stock, $.00004 par value; 60,000,000 shares authorized; 198,155 shares issued
and outstanding at December 31, 1996 and 6,890,050 issued and outstanding at
June 30, 1997 .......................................................................... 275 8
Additional paid-in capital ................................................................ 48,233,593 --
Deficit accumulated during the development stage .......................................... (24,772,284) (19,633,040)
------------ ------------
Total stockholders' equity (deficit) .................................................. 23,461,584 (16,777,929)
------------ ------------
Total liabilities and stockholders' equity (deficit) .................................. $ 30,332,539 $ 2,627,624
============ ============
</TABLE>
See accompanying notes to financial statements.
1
<PAGE> 4
ASCENT PEDIATRICS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
CONDENSED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Cumulative from
Inception
Three Months Ended Six Months Ended (March 16,
June 30, June 30, 1989) to
---------------------------- ---------------------------- June 30,
1997 1996 1997 1996 1997
----------- ----------- ----------- ----------- ---------------
<S> <C> <C> <C> <C> <C>
Licensing revenue ............................ -- -- -- -- $ 303,949
------------
Costs and expenses:
Selling, general and administrative
expenses ............................ $ 1,378,686 $ 499,095 $ 2,351,512 $ 927,048 10,555,071
Research and development expenses ... 937,466 769,939 2,465,581 1,244,576 14,475,402
----------- ----------- ----------- ----------- ------------
Total expenses ...................... 2,316,152 1,269,034 4,817,093 2,171,624 25,030,473
----------- ----------- ----------- ----------- ------------
Loss from operations ................ (2,316,152) (1,269,034) (4,817,093) (2,171,624) (24,726,524)
Interest income .............................. 168,312 14,443 241,057 39,467 994,600
Interest expense ............................. (305,173) -- (325,089) -- (325,089)
Gain on sale of fixed assets ................. -- -- 9,242 -- 9,242
----------- ----------- ----------- ----------- ------------
Net loss ............................ (2,453,013) (1,254,591) (4,891,883) (2,132,157) (24,047,771)
Accretion to redemption value
of preferred stock .................. 27,735 -- 247,361 -- 733,363
----------- ----------- ----------- ----------- ------------
Net loss to common stockholders ..... $(2,480,748) $(1,254,591) $(5,139,244) $(2,132,157) $(24,781,134)
=========== =========== =========== =========== ============
Net loss per common share .................... $ (0.74) $ (1.25) $ (2.35) $ (2.12)
=========== =========== =========== ===========
Weighted average shares outstanding .......... 3,360,103 1,007,218 2,190,161 1,007,090
=========== =========== =========== ===========
</TABLE>
See accompanying notes to financial statements.
2
<PAGE> 5
ASCENT PEDIATRICS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
CONDENSED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Cumulative from
Six Months Six Months Inception
Ended Ended (March 16, 1989)
June 30, June 30, to June 30,
1997 1996 1997
------------- ------------ ----------------
<S> <C> <C> <C>
Cash flows for operating activities:
Net loss ........................................... $ (4,891,883) $(2,132,157) $(24,047,771)
Adjustments to reconcile net loss to net cash
used for operating activities:
Depreciation and amortization ................. 399,257 24,057 605,882
Gain on sale of fixed asset ................... (9,242) -- (9,242)
Changes in operating assets and liabilities:
Other current assets .......................... (402,203) (5,433) (414,515)
Deposits ...................................... 6,369 -- (57,944)
Deferred charges .............................. (119,895) (25,000) (160,135)
Accounts payable .............................. 312,397 211,115 574,437
Accrued expenses .............................. 165,998 (93,897) 1,477,171
Other non-current assets ...................... (46,326) -- (46,326)
------------ ----------- ------------
Net cash used for operating activities ........... (4,585,528) (2,021,315) (22,078,443)
------------ ----------- ------------
Cash flows used for investing activities:
Purchase of property and equipment ................. (314,305) (12,210) (695,947)
Proceeds from sale of fixed assets ................. 38,050 -- 38,050
Payments related to acquisition .................... -- -- (250,000)
------------ ----------- ------------
Net cash used for investing activities .... (276,255) (12,210) (907,897)
------------ ----------- ------------
Cash flows from financing activities:
Proceeds from sale of common stock ................. 17,863,188 -- 17,867,246
Proceeds from sale of preferred stock, net
of issuance costs ................................ 6,930,126 2,638,645 27,131,568
Proceeds from issuance of debt and related warrants 7,000,000 -- 7,150,000
Debt issue costs ................................... (594,565) -- (594,565)
Proceeds from exercise of warrants ................. -- 4,800 4,800
Repayment of debt .................................. -- -- (150,000)
------------ ----------- ------------
Net cash provided by financing activities . 31,198,749 2,643,445 51,409,049
------------ ----------- ------------
Net increase in cash and cash equivalents ............... 26,336,966 609,920 28,422,709
Cash and cash equivalents, beginning of period .......... 2,085,743 2,538,047 --
------------ ----------- ------------
Cash and cash equivalents, end of period ................ $ 28,422,709 $ 3,147,967 $ 28,422,709
============ =========== ============
</TABLE>
See accompanying notes to financial statements.
3
<PAGE> 6
ASCENT PEDIATRICS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
1. NATURE OF BUSINESS
Ascent Pediatrics, Inc. (the "Company"), formerly Ascent
Pharmaceuticals, Inc., incorporated in Delaware on March 16, 1989, is a
drug development and marketing company focused exclusively on the
pediatric market. Since its inception, the Company has operated as a
development stage enterprise devoting substantially all of its efforts
to establishing a new business and to carrying on development
activities.
2. BASIS OF PRESENTATION
The accompanying financial statements are unaudited and have been
prepared by the Company in accordance with generally accepted
accounting principles for interim financial information and with the
instructions to Form 10-Q and Article 10 of Regulation S-X.
Accordingly, certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted pursuant
to such rules and regulations. The interim financial statements
include, in the opinion of management, all adjustments (consisting of
normal and recurring adjustments) that are necessary for a fair
presentation of the results for the interim periods ended June 30, 1997
and 1996. The results for the interim periods presented are not
necessarily indicative of results to be expected in the full fiscal
year.
These financial statements should be read in conjunction with the
audited financial statements and notes thereto for the year ended
December 31, 1996 included in the Company's Registration Statement on
Form S-1 (No. 333-23319) as filed with the Securities and Exchange
Commission on March 14, 1997, as amended.
3. ACCRUED EXPENSES
<TABLE>
<CAPTION>
June 30, December 31,
1997 1996
---------- ------------
<S> <C> <C>
Accrued expenses consisted of the following:
Compensation expenses............................. $ 243,815 $ 109,268
Clinical study expenses........................... 249,596 156,134
Advertising expenses............................. 155,190 364,692
Other............................................. 828,569 446,462
---------- ----------
$1,477,170 $1,076,556
</TABLE>
4. WARRANTS RELATED TO SUBORDINATED SECURED NOTES
In connection with the Company's issuance of subordinated secured notes
on January 31, 1997 and June 4, 1997, the Company issued warrants
exercisable for 224,429 and 554,839 shares of Common Stock,
respectively. The fair market value of the warrants (as of January 31,
1997) issued on January 31, 1997 was recorded as a discount of $836,994
to the subordinated secured notes issued on such date. Consequently,
such subordinated secured notes were recorded at $1,163,006. Similarly,
the fair market value of the warrants (as of January 31, 1997) issued
on June 4, 1997 was recorded at a discount of $1,668,746 to the
subordinated secured notes issued on such date. Consequently, such
subordinated secured notes were recorded at $3,331,254. Accordingly,
approximately $2,506,000 of accretion will be charged to interest
expense, in addition to the stated interest rates, over the term of the
notes. The Company recorded $594,565 toward issuance costs related to
these notes and will be amortized over the term of the note.
4
<PAGE> 7
ASCENT PEDIATRICS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
(continued)
5. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Financial Statement Presentation
On May 27, 1997, the Company effected a 0.85-for-one reverse stock
split of its Common Stock and increased the number of authorized shares
of Common Stock to 60,000,000. Accordingly, all share and per share
amounts have been adjusted to reflect the reverse stock split as though
it had occurred at the beginning of the initial period presented.
Historical Net Loss Per Common Share
The net loss per common share is computed based upon the weighted
average number of common shares and common equivalent shares
outstanding after certain adjustments described below. Common
equivalent shares consist of common stock options and warrants where
the effect of their inclusion would be dilutive. In accordance with
Securities and Exchange Commission Staff Accounting Bulletin No. 83,
all common and common equivalent shares issued during the 12 month
period prior to the initial filing date of the Company's Registration
Statement on Form S-1 relating to its initial public offering of shares
of Common Stock have been included in the calculation as if they were
outstanding for all periods prior to the initial public offering, using
the treasury stock method. Accretion of redeemable preferred stock is
included as an increase to net loss attributable to common
stockholders.
Recent Pronouncements
In February 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 128, Earnings Per Share
("FAS 128"). FAS 128 specifies the computation, presentation and
disclosure requirements for earnings per share. FAS 128 is effective
for financial statements issued for periods ending after December 15,
1997, including interim periods, and earlier application is not
permitted. FAS 128 requires restatement of all prior-period
earnings-per-share data presented after the effective date. The
adoption of FAS 128 is not expected to have a material impact on the
Company's Earnings Per Share calculation.
6. PUBLIC OFFERING
In June 1997, the Company completed its initial public offering of
2,240,000 shares of Common Stock, raising approximately $17.9 million
of net proceeds, after deducting offering costs. A significant portion
of these proceeds was invested in one money market mutual fund.
Concurrent with the closing of the initial public offering, all
5,208,657 shares of Series A, Series B, Series D, Series E and Series F
Convertible Preferred Stock were converted into 4,440,564 shares of
Common Stock.
5
<PAGE> 8
ASCENT PEDIATRICS, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
(continued)
7. SUBSEQUENT EVENTS
On July 10, 1997, the Company closed the acquisition of the Feverall
line of acetaminophen rectal suppositories from Upsher-Smith
Laboratories, Inc. ("Upsher-Smith"), pursuant to an Asset Purchase
Agreement dated as of March 25, 1997 (the "Asset Purchase Agreement")
between the Company and Upsher-Smith.
The purchase price was $11,721,265. The Company paid $6,221,265 of such
amount in cash (including a $250,000 deposit that the Company
previously paid to Upsher-Smith) and issued Upsher-Smith a promissory
note for the balance. The promissory note matures on February 28, 1998,
does not bear interest and is secured by all the assets acquired by the
Company from Upsher-Smith. The assets acquired by the Company consist
of the Feverall acetaminophen rectal suppository product line and
certain related assets, including the Feverall trademark and the
Feverall Sprinkle Caps powder and Acetaminophen Uniserts suppository
product lines. A significant portion of these payments will be
allocated toward Goodwill which will be amortized over 20 years on a
straight line basis.
6
<PAGE> 9
ITEM 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
General
The Company is a drug development and marketing company focused exclusively
on the pediatric market. The Company commenced operations in March 1989 and
since that time has been engaged primarily in developing its products and
product candidates and in organizational efforts, including recruiting
scientific and management personnel and raising capital. To date, the Company
has not received any revenue from the sale of products. The Company expects to
introduce its first products to the market in the second half of 1997. All
revenues received by the Company to date have consisted of payments in
connection with a licensing arrangement and interest on invested funds.
The Company has incurred net losses since its inception and expects to incur
additional operating losses over at least the next two years as it continues its
product development programs, establishes a sales and marketing organization and
introduces products to the market. The Company expects cumulative losses to
increase over this period. The Company has incurred a deficit accumulated since
inception through June 30, 1997 of $24,772,000.
Results of Operations
Three and Six Months Ended June 30, 1997 Compared with Three and Six Months
Ended June 30, 1996.
Selling, General and Administrative Expenses. The Company incurred selling,
general and administrative expenses for the three and six months ended June 30,
1997 of $1,379,000 and $2,352,000, respectively, or an increase of $880,000 and
$1,424,000, respectively, over the comparable prior year periods. Selling
expenses increased in the three and six months ended June 30, 1997 by $657,000
and $874,000, respectively, primarily as a result of (i) increased personnel
expenses as the Company assembled sales and marketing personnel for the
anticipated introduction of its products in the second half of 1997 and (ii)
increases in advertising and promotional activities in anticipation of such
product introductions. General and administrative expenses increased in the
three and six months ended June 30, 1997 by $222,000 and $550,000, respectively,
primarily as a result of additional staffing expenses resulting from the
Company's increase in infrastructure relating to the anticipated product
introductions.
Research and Development. The Company incurred research and development
expenses for the three and six months ended June 30, 1997 of $937,000 and
$2,466,000, respectively, or an increase of $168,000 and $1,221,000,
respectively, over the comparable prior year periods ended June 30, 1997. The
increase for the three month period ended June 30, 1997 primarily reflected
increased third party manufacturing and development expenditures relating to the
Company's albuterol controlled-release suspension product. The increase for the
six month period ended June 30, 1997 primarily reflected increased third party
development expenses relating to the Company's albuterol controlled-release
suspension product and increased expenses for clinical trials relating to the
Company's acetaminophen controlled-release product.
Interest. The Company had interest income of $168,000 and $241,000 for the
three and six months ended June 30, 1997, respectively, or an increase of
$154,000 and $202,000, respectively, over the comparable prior year periods. The
increases were primarily attributable to increases in funds available for
investment by the Company resulting from the Company's initial public offering
of Common Stock, the sale of Series F Convertible Preferred Stock and the
issuance of subordinated secured notes. The Company had interest expense of
$305,000 and $325,000 for the three and six months ended June 30, 1997,
respectively. The interest expense reflected the accretion of the Company's
subordinated secured notes to their maturity amounts.
7
<PAGE> 10
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(continued)
LIQUIDITY AND CAPITAL RESOURCES
Since its inception, the Company has financed its operations primarily from
private sales of preferred stock, the private sale of subordinated secured notes
and related common stock purchase warrants and an initial public offering of
shares of Common Stock. As of June 30, 1997, the Company had raised
approximately $27,132,000 (net of issuance costs) from the sale of preferred
stock, approximately $6.6 million (net of issuance costs) from the issuance of
subordinated secured notes and related warrants and approximately $17.9 million
(net of issuance costs) from an initial public offering of 2,240,000 shares of
Common Stock.
In January 1997, the Company issued $2,000,000 of subordinated secured notes,
resulting in net proceeds to the Company of $1,790,000, which was recorded as a
liability of $1,163,000 with $837,000 to be accreted as interest expense over
the term of the notes. In May 1997, the Company issued an additional $5,000,000
of subordinated secured notes, resulting in net proceeds to the Company of
$4,616,000, which was recorded as a liability of $3,331,000 with $1,669,000 to
be accreted as interest expense over the term of the notes. The notes amortize
in eight equal quarterly principal installments and require quarterly interest
payments on the unpaid principal balance, with the first quarterly payment of
principal and interest due December 4, 1997. The notes are collateralized by a
lien on all of the Company's assets, prohibit the payment of dividends by the
Company and, subject to certain exceptions (including for up to $6,000,000 of
senior secured bank financing and $5,500,000 of secured purchase money financing
in connection with the acquisition of the Feverall product line), prohibit the
incurrence of additional indebtedness.
On February 3, 1997 and February 28, 1997, the Company raised an aggregate of
$6,957,000 of net proceeds from private sales of shares of Series F Convertible
Preferred Stock.
On June 4, 1997, the Company completed its initial public offering of
2,000,000 shares of Common Stock, raising approximately $15.9 million of net
proceeds. In addition, on June 26, 1997, the underwriters of the Company's
initial public offering exercised an over allotment option and purchased an
additional 240,000 shares of Common Stock, resulting in net proceeds to the
Company of approximately $2.0 million.
Through June 30, 1997, the Company applied the proceeds from the sale of
preferred stock, subordinated secured notes, its initial public offering and
revenues from licensing agreements to fund losses of $24,048,000 and the
investment of $696,000 in property and equipment. As of June 30, 1997, the
Company had cash and cash equivalents of $28,423,000.
8
<PAGE> 11
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(continued)
The Company's future capital requirements will depend on many factors,
including continued progress in its product development programs, the magnitude
of these programs, the results of pre-clinical studies and clinical trials, the
time and cost involved in obtaining regulatory approvals, the costs involved in
filing, prosecuting, enforcing and defending patent claims, competing
technological and market developments, the ability of the Company to establish
and maintain a sales and marketing capability and product development,
manufacturing and marketing relationships, and the costs and success of
commercialization activities and arrangements. The Company's business strategy
requires a significant commitment of funds to conduct clinical testing of
potential products, to pursue regulatory approval of such products and to
establish sales and marketing capabilities and manufacturing relationships
necessary to bring such products to market.
The Company has no committed external sources of capital. Based on its current
operating plan, the Company anticipates that its existing capital resources,
together with interest earned thereon and internally generated funds, will be
adequate to satisfy its capital requirements for at least the next 24 months.
However, there may be circumstances, particularly a delay in the introduction of
products or lower than anticipated product sales, that might accelerate the
Company's use of its existing capital resources. The Company may be required to
raise substantial additional funds in the future, including through
collaborative relationships and public or private financings. No assurance can
be given that additional financing will be available, or, if available, that it
will be available on acceptable terms.
9
<PAGE> 12
PART II - OTHER INFORMATION
ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS:
Prior to the effectiveness of the registration statements on Forms S-1 and 8-A
relating to the Company's initial public offering of shares of Common Stock, by
written consent, on April 17, 1997, the stockholders of the Company approved
each of the following matters by a vote of 227,875 shares of Common Stock,
800,000 shares of Series A Convertible Preferred Stock, 399,999 shares of Series
B Convertible Preferred Stock, 1,192,856 shares of Series D Convertible
Preferred Stock, 679,762 shares of Series E Convertible Preferred Stock and
1,625,074 shares of Series F Convertible Preferred Stock (voting together as a
class, and all preferred stock voting together as a separate class) for, 0
shares against, 0 shares abstaining and 0 broker non-votes:
1. A Certificate of Amendment to the Company's Amended and Restated
Certificate of Incorporation effecting, among other things, a
0.85-for-1 reverse stock split of the Company's Common Stock.
2. An Amended and Restated Certificate of Incorporation of the
Company, effective upon the consummation of the Company's initial
public offering of shares of Common Stock.
3. Amended and Restated By-laws of the Company, effective upon the
consummation of the Company's initial public offering of shares of
Common Stock.
4. The Company's Amended and Restated 1992 Equity Incentive Plan,
1997 Employee Stock Purchase Plan and 1997 Director Stock Option
Plan.
5. Amendments to certain registration rights provided by (i) the
Series F Convertible Preferred Stock and Warrant Purchase
Agreement dated as of June 28, 1996 by and among the Company and
the Stockholders (as such term is defined therein), (ii) the
Common Stock Purchase Warrants issued to Banque Paribas on
February 28, 1997 and (iii) the Common Stock Purchase Warrants
issued to certain designees of Bentley Securities on February 28,
1997.
6. Election of the following Class I, Class II and Class III
Directors:
Class I Directors (initial term expires at the 1998 Annual Meeting
of Stockholders):
Raymond F. Baddour, Ph.D.
Michael J.F. Du Cros
Lee J. Schoeder
Class II Directors (initial term expires at the 1999 Annual
Meeting of Stockholders):
Alan R. Fox
Robert E. Baldini
Thomas W. Janes
Class III Directors (initial term expires at the 2000 Annual
Meeting of Stockholders):
Emmett Clemente, Ph.D.
Andre Lamotte, Sc.D
Terrance McGuire
10
<PAGE> 13
PART II - OTHER INFORMATION
(continued)
7. Ratification of the selection of Coopers & Lybrand L.L.P. as the
Company's auditors for the fiscal year ending December 31, 1997.
8. Ratification of all actions of the directors and officers of the
Company taken on behalf of the Company since inception (March 16,
1989).
ITEM 6 EXHIBITS AND REPORTS ON FORM 8-K:
(a) Exhibits. See exhibit index on page 11
(b) Reports on Form 8-K. None
11
<PAGE> 14
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned, thereunto duly authorized.
ASCENT PEDIATRICS, INC.
Date: August 14, 1997 By /s/ JOHN G. BERNARDI
-------------------------------------------
John G. Bernardi, Vice President- Finance
and Treasurer (Principal Financial Officer)
12
<PAGE> 15
EXHIBIT INDEX
Exhibit Numbers Description Page
27 Financial Data Schedule
13
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 6-MOS
<FISCAL-YEAR-END> DEC-31-1997 DEC-31-1997
<PERIOD-START> APR-01-1997 JAN-01-1997
<PERIOD-END> JUN-30-1997 JUN-30-1997
<CASH> 28,422,709 28,422,709
<SECURITIES> 0 0
<RECEIVABLES> 0 0
<ALLOWANCES> 0 0
<INVENTORY> 175,551 175,551
<CURRENT-ASSETS> 28,837,223 28,837,223
<PP&E> 557,187 557,187
<DEPRECIATION> 147,336 147,336
<TOTAL-ASSETS> 30,332,539 30,322,539
<CURRENT-LIABILITIES> 2,051,606 2,051,606
<BONDS> 0 0
0 0
0 0
<COMMON> 275 275
<OTHER-SE> 23,461,309 23,461,309
<TOTAL-LIABILITY-AND-EQUITY> 30,332,539 30,332,539
<SALES> 0 0
<TOTAL-REVENUES> 0 0
<CGS> 0 0
<TOTAL-COSTS> 0 0
<OTHER-EXPENSES> 2,316,152 4,817,093
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 305,173 325,089
<INCOME-PRETAX> 2,453,013 4,891,883
<INCOME-TAX> 0 0
<INCOME-CONTINUING> 0 0
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 2,453,013 4,891,883
<EPS-PRIMARY> (0.74) (2.35)
<EPS-DILUTED> (0.74) (2.35)
</TABLE>
