AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 28, 1999
REGISTRATION NO. 333-________
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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TRIANGLE PHARMACEUTICALS, INC.
(Exact name of Registrant as Specified in Its Charter)
DELAWARE 56-1930728
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
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4 UNIVERSITY PLACE, 4611 UNIVERSITY DRIVE, DURHAM, NORTH CAROLINA, 27707
(919) 493-5980
(Address, Including Zip Code, and Telephone Number, Including Area Code, of
Registrant's Principal Executive Offices)
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DAVID W. BARRY, M.D.
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
TRIANGLE PHARMACEUTICALS, INC.
4 UNIVERSITY PLACE, 4611 UNIVERSITY DRIVE
DURHAM, NORTH CAROLINA 27707
(919) 493-5980
(Name, Address, Including Zip Code, and Telephone Number, Including Area
Code, of Agent For Service)
---------------
COPIES TO:
JOHN A. DENNISTON, ESQ.
MARIA SENDRA, ESQ.
LANCE S. KURATA, ESQ.
BROBECK, PHLEGER & HARRISON LLP
550 WEST "C" STREET, SUITE 1300
SAN DIEGO, CALIFORNIA 92101
(619) 234-1966
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
FROM TIME TO TIME AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT.
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If only the securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box: |_|
If any of the securities being registered on this form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box: |X|
<PAGE>
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering: |_|
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering: |_|
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box: |_|
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
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TITLE OF EACH CLASS OF SECURITIES AMOUNT TO BE PROPOSED MAXIMUM OFFERING PROPOSED MAXIMUM AGGREGATE AMOUNT OF
TO BE REGISTERED REGISTERED PRICE PER SHARE(1) OFFERING PRICE (1) REGISTRATION FEE
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<S> <C> <C> <C> <C>
Common Stock, $0.001 par value per
share 1,700,000 shares(2) $16.50 $28,050,000 $7,798
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</TABLE>
(1) The price of $16.50, the average of the high and low prices of Triangle's
common stock on the Nasdaq Stock Market's National Market on June 24,
1999, is set forth solely for the purpose of computing the registration
fee in accordance with Rule 457(c) under the Securities Act of 1933 as
amended
(2) This Registration Statement shall also cover any additional shares of
common stock which become issuable in connection with the shares
registered for sale hereby as a result of any stock dividend, stock split,
recapitalization or other similar transaction effected without the receipt
of consideration which results in an increase in the number of the
Registrant's outstanding shares of common stock.
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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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Subject to Completion, Dated June 28, 1999
Preliminary Prospectus
The information in this prospectus is not complete and may be changed. The
selling stockholders may not sell the common stock covered by this prospectus
until the registration statement filed with the Securities and Exchange
Commission is effective. This prospectus is not an offer to sell the common
stock and it is not soliciting an offer to buy the common stock in any state
where the offer or sale is not permitted.
1,700,000 Shares
TRIANGLE PHARMACEUTICALS, INC.
Common Stock
This prospectus relates to the public offering, which is not being
underwritten, of 1,700,000 shares of our common stock by some of our current
stockholders. We will not receive any proceeds from the sale of these shares.
The prices at which the selling stockholders may sell the shares will be
determined by the prevailing market price for the shares or in negotiated
transactions. The selling stockholders may also sell the shares to or with the
assistance of broker-dealers, who may receive compensation in excess of their
customary commissions.
Our common stock is traded on the Nasdaq National Market under the symbol
"VIRS." On June 24, 1999 the average of the high and low prices for the common
stock was $16.50 per share.
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The common stock offered involves a high degree of risk. See "Risk
Factors" commencing on page 3 for a discussion of some important risks you
should consider before buying any shares of common stock.
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Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities, or passed upon the
accuracy or adequacy of this prospectus. Any representation to the contrary is a
criminal offense.
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The date of this prospectus is June ____, 1999.
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
We file reports, proxy statements and other information with the SEC. You
may read and copy any document we file at the SEC's public reference rooms in
Washington, D.C., New York, New York and Chicago, Illinois. Please call the SEC
at 1-800-SEC-0330 for further information on the public reference rooms. Our SEC
filings are also available to the public on the SEC's website at
http://www.sec.gov.
INFORMATION INCORPORATED BY REFERENCE
The SEC 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 incorporated by reference is
considered to be part of this prospectus, and later information filed with the
SEC will update and supersede this information. We incorporate by reference the
documents listed below and any future filings we make with the SEC under Section
13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of 1934 until our
offering is completed.
1. Our Annual Report on Form 10-K for the fiscal year ended December
31, 1998, including certain information in our Definitive Proxy
Statement in connection with our 1999 Annual Meeting of
Stockholders;
2. Our Quarterly Report on Form 10-Q for the quarterly period ended
March 31, 1999;
3. Our Current Reports on Form 8-K filed February 10, 1999 and June 18,
1999;
4. The description of our Common Stock contained in our Registration
Statements on Form 8-A filed October 18, 1996, February 10, 1999 and
June 18, 1999; and
5. The description of our Preferred Stock Purchase Rights, contained in
our Registration Statement on Form 8-A filed February 10, 1999, as
amended on Form 8-A/A filed June 18, 1999, including any amendments
or reports filed for the purpose of updating such descriptions.
The reports and other documents that we file after the date of this
prospectus will update and supersede the information in this prospectus.
You may request a copy of these filings, at no cost, by writing or
telephoning us at:
Triangle Pharmaceuticals, Inc.,
4 University Place,
4611 University Drive
Durham, North Carolina, 27707
(919) 493-5980
Attn: General Counsel.
You should rely only on the information provided or incorporated by
reference in this prospectus. We have not authorized anyone to provide you with
different information. The selling stockholders are not authorized to make an
offer of these securities in any state where the offer is not permitted. You
should not assume that the information in this prospectus is accurate as of any
date other than the date on the front of the document.
Triangle Pharmaceuticals is our trademark. This prospectus also includes
names and trademarks of other companies.
FORWARD-LOOKING STATEMENTS
In addition to historical information, this prospectus may contain
forward-looking statements. These statements involve risks and uncertainties.
Our actual results could differ materially from those projected in the
forward-looking statements. Factors that could cause or contribute to such
differences include those discussed in the section entitled "Risk Factors," as
well as those discussed elsewhere in this prospectus or in documents
incorporated by reference herein. We undertake no obligation to update these
forward-looking statements.
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THE COMPANY
We develop new drug candidates primarily in the antiviral area, with a
particular focus on therapies for HIV, including AIDS, and the hepatitis B
virus. We have an existing portfolio of six licensed drug candidates and one
drug candidate for which we have an option to acquire a license. Members of our
senior management, prior to joining Triangle, played instrumental roles in
developing several leading antiviral therapies. Our goal is to capitalize on our
management team's expertise, as well as on advances in virology and immunology,
to identify, develop and commercialize new drug candidates that can be used
alone or in combination (coactively) to treat serious diseases.
Triangle was incorporated in Delaware in July 1995. Our principal
executive offices are located at 4 University Place, 4611 University Drive,
Durham, North Carolina 27707, and our telephone number is (919) 493-5980.
References in this prospectus to "Triangle," "we," "our" or "us" are to Triangle
Pharmaceuticals, Inc. and our wholly-owned subsidiary, Avid Corporation, a
Pennsylvania corporation.
RECENT DEVELOPMENTS
On June 2, 1999, we entered into a series of agreements with Abbott
Laboratories to establish a worldwide strategic alliance covering six antiviral
compounds (the "Abbott Alliance"). Under the Abbott Alliance, Triangle and
Abbott will collaborate with respect to the clinical development, registration,
distribution and marketing of various proprietary pharmaceutical products for
the prevention and treatment of HIV and hepatitis B virus. In the United States,
Abbott and Triangle will co-promote four Triangle products currently in active
development for HIV and/or hepatitis B, Coactinon(TM), Coviracil(TM), DAPD and
L-FMAU, and Abbott's two HIV protease inhibitors, Norvir(R)(ritonavir), approved
in 1996, and ABT-378, currently in Phase III development. Outside the United
States, Abbott will have exclusive sales and marketing rights for the four
Triangle antiviral compounds. Triangle and Abbott will share profits and losses
for all Triangle drug candidates. Triangle will receive detailing fees and
commissions on incremental sales they generate for Abbott's protease inhibitors.
In addition, Abbott will have the right of first discussion to market future
Triangle compounds.
Under the Abbott Alliance, Abbott will also purchase up to approximately
6.57 million shares of our Common Stock at $18 per share and will make
additional payments to us, including non-contingent research funding of $31.7
million and up to $185 million of contingent development milestone payments. The
closing of the Abbott Alliance is subject to the satisfaction of several
conditions, including the closing of all of the agreements entered into in
connection with the Abbott Alliance, Hart-Scott-Rodino antitrust clearance, the
negotiation of a manufacturing agreement between the parties, as well as the
satisfaction or waiver of various other closing conditions under the various
Abbott Alliance agreements.
RISK FACTORS
In addition to the other information in this prospectus, you should
carefully consider the following risks and uncertainties before deciding to
purchase shares of our Common Stock. An investment in our Common Stock involves
a high degree of risk.
Our drug candidates may never be successfully commercialized.
Many of our drug candidates are at an early stage of development and all
of our drug candidates will require expensive and lengthy testing and regulatory
clearances. None of our drug candidates has been approved by regulatory
authorities. We do not expect any of our drug candidates to be commercially
available before the year 2000. There are many reasons that we may fail in our
efforts to develop our drug candidates, including that:
o our drug candidates will be ineffective, toxic or will not receive
regulatory clearances,
o our drug candidates will be too expensive to manufacture or market
or will not achieve broad market acceptance,
o third parties will hold proprietary rights that may preclude us from
marketing our drug candidates, or
o third parties will market equivalent or superior products.
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The success of our business depends upon our ability to successfully
develop and market our drug candidates.
We have incurred losses since inception and may never reach profitability.
We formed our company in July 1995 and we have only a limited operating
history for you to review in evaluating our business. We have incurred losses
since our inception. At March 31, 1999, our accumulated deficit was $135.3
million. Our historical costs relate primarily to the acquisition and
development of our drug candidates and selling, general and administrative
costs. We have not generated any revenue to date and do not expect to do so
before the year 2000. In addition, we expect annual losses to increase over the
next several years as we expand our drug development efforts. To become
profitable, we must successfully develop and obtain regulatory approval for our
drug candidates and effectively manufacture, market and sell any products we
develop. We may never generate significant revenue or achieve profitable
operations.
We may be unable to obtain the capital necessary to fund our operations.
Our drug development programs and potential commercialization of our drug
candidates require substantial capital expenditures, including expenses for
preclinical testing, chemical synthetic scale-up, manufacture of drug substance
for clinical trials and toxicology studies, clinical trials of drug candidates,
sales and marketing expenses and payments to our licensors. We expect our
capital requirements to increase significantly. Our future capital needs will
depend on many factors, including:
o the progress and magnitude of our drug development programs,
o the scope and results of preclinical testing and clinical trials,
o the cost, timing and outcome of regulatory reviews,
o the costs under license and option agreements for our drug
candidates (including the costs of obtaining patent protection for
our drug candidates),
o the costs of acquiring any additional drug candidates,
o the rate of technological advances,
o the commercial potential of our drug candidates,
o the magnitude of our administrative and legal expenses,
o the costs of establishing sales and marketing functions, and
o the costs of establishing third party arrangements for
manufacturing.
We have incurred negative cash flow from operations since we began our
company and do not expect to generate positive cash flow from our operations for
at least the next several years. Although we expect the Abbott Alliance to
provide us with a significant amount of funding, there can be no assurance that
such funding will be sufficient to meet our needs or that the Abbott Alliance
will be consummated. Therefore, we may need additional future financings to fund
our operations. We may not be able to obtain adequate financing to fund our
operations, and any additional financing we obtain may be on terms that are not
favorable to us. In addition, any additional financings could substantially
dilute our stockholders. If adequate funds are not available, we will be
required to delay, reduce or eliminate one or more of our drug development
programs, or to enter into new collaborative arrangements or modify the Abbott
Alliance on terms that are not favorable to us. These collaborative arrangements
could result in the transfer to third parties of rights that we consider
valuable. In addition, we often consider the acquisition of technologies and
drug candidates that would increase our capital requirements. Our inability to
meet our capital requirements would adversely affect our business.
Clinical trials required for commercialization of our drug candidates may
not be successfully completed.
To obtain regulatory approvals needed for the sale of our drug
1candidates, we must demonstrate through preclinical testing and clinical trials
that each drug candidate is safe and effective. The clinical trial process is
complex and uncertain. Positive results from preclinical testing and early
clinical trials do not ensure positive results in pivotal clinical trials. Many
companies in our industry have suffered significant setbacks in pivotal clinical
trials, even after promising results in earlier trials. Any of our drug
candidates may produce undesirable side effects in
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humans. These side effects could cause us or regulatory authorities to
interrupt, delay or halt clinical trials of a drug candidate. These side effects
could also result in the U.S. Food and Drug Administration ("FDA") or foreign
regulatory authorities refusing to approve the drug candidate for any and all
targeted indications. We, the FDA or foreign regulatory authorities may suspend
or terminate clinical trials at any time if we or they believe the trial
participants face unacceptable health risks. Clinical trials may not demonstrate
that our drug candidates are safe or effective.
Clinical trials are lengthy and expensive. They require adequate supplies
of drug substance and sufficient patient enrollment. Patient enrollment is a
function of many factors, including:
o the size of the patient population,
o the nature of the protocol,
o the proximity of patients to clinical sites, and
o the eligibility criteria for the clinical trial.
Delays in patient enrollment can result in increased costs and longer
development times. Even if we successfully complete clinical trials, we may not
be able to file any required regulatory submissions in a timely manner and we
may not receive regulatory approval for the drug candidate. Our failure to
successfully complete clinical trials and obtain regulatory approvals will
adversely affect our business.
We may not have adequate patent rights to protect or commercialize our drug
candidates.
Our success will depend on our ability and the ability of our licensors to
obtain and maintain patents and proprietary rights for our drug candidates and
to avoid infringing the proprietary rights of others, both in the United States
and in foreign countries. We have no patents in our own name and we have a small
number of patent applications of our own pending (one of which is a joint
application with co-inventors from another institution). We have, however,
licensed or we have an option to license patents, patent applications and other
proprietary rights from third parties for each of our drug candidates. If we
breach our licenses, we may lose rights to important technology and drug
candidates.
Our patent position, like that of many pharmaceutical companies, is
uncertain and involves complex legal and factual questions for which important
legal principles are unresolved. We may not develop or obtain rights to products
or processes that are patentable. Even if we do obtain patents, they may not
adequately protect the technology we own or have in-licensed. In addition,
others may challenge, seek to invalidate, infringe or circumvent any patents we
own or in-license, and rights we receive under those patents may not provide
competitive advantages to us. Further, the manufacture, use or sale of our
products or processes may infringe the patent rights of others.
Several pharmaceutical and biotechnology companies, universities and
research institutions have filed patent applications or received patents that
cover our technologies or technologies similar to ours. Others have filed patent
applications and received patents that conflict with patents or patent
applications we own or have in-licensed, either by claiming the same methods or
compounds or by claiming methods or compounds that could dominate those owned by
or licensed to us. In addition, we may not be aware of all patents or patent
applications that may impact our ability to make, use or sell any of our drug
candidates. For example, United States patent applications are confidential
while pending in the Patent and Trademark Office ("PTO"), and patent
applications filed in foreign countries are often first published six months or
more after filing. Any conflicts resulting from third party patent applications
and patents could significantly reduce the coverage of our patents and limit our
ability to obtain meaningful patent protection. If other companies obtain
patents with conflicting claims, we may be required to obtain licenses to these
patents or to develop or obtain alternative technology. We may not be able to
obtain any such license on acceptable terms or at all. Any failure to obtain
such licenses could delay or prevent us from pursuing the development or
commercialization of our drug candidates, which would adversely affect our
business.
There are significant risks regarding the patent rights of two of our
in-licensed drug candidates. We may not be able to commercialize Coviracil or
DAPD for HIV and/or the hepatitis B virus ("HBV") due to patent rights held by
third parties other than our licensors. Third parties have filed numerous patent
applications and have received numerous issued patents in the United States and
many foreign countries that relate to these drug candidates and their use alone
or coactively to treat HIV and HBV. As a result, our patent position regarding
the use of Coviracil and DAPD to treat HIV and/or HBV is highly uncertain and
involves numerous complex legal and
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factual questions that are unknown or unresolved. If any of these questions is
resolved in a manner that is not favorable to us, we would not have the right to
commercialize Coviracil and/or DAPD in the absence of a license from one or more
third parties, which may not be available on acceptable terms or at all. In
addition, even if any of these questions is favorably resolved, we may still
attempt to obtain licenses from one or more third parties to reduce or eliminate
the risks relating to some or all of these matters. Such licenses may not be
available on acceptable terms or at all. Our inability to commercialize either
of these drug candidates could adversely affect our business.
Coviracil (emtricitabine)
Coviracil, a purified form of FTC, belongs to the same general class of
nucleosides as 3TC. In the United States, the FDA has approved 3TC for the
treatment of HBV and for use in combination with AZT for the treatment of HIV.
Regulatory authorities have approved 3TC for the treatment of HBV in several
other countries and for use in combination with other nucleoside analogues for
the treatment of HIV in a number of other countries. Glaxo Wellcome plc
("Glaxo") currently sells 3TC for the treatment of HIV and HBV under a license
agreement with BioChem Pharma Inc. ("BioChem Pharma"). We obtained rights to
Coviracil under a license from Emory University ("Emory"). In 1990 and 1991,
Emory filed in the United States and thereafter in numerous foreign countries
patent applications with claims to compositions of matter and methods to treat
HIV and HBV with Coviracil. In 1991, Yale University ("Yale") filed in the
United States patent applications on FTC, including Coviracil and its use to
treat HBV, and subsequently licensed its rights under those patent applications
to Emory. Our license arrangement with Emory includes all rights to Coviracil
and its uses claimed in the Yale patent applications.
HIV. Emory received a United States patent in 1993 covering a method to
treat HIV with Coviracil. In September 1998, Emory received United States and
European patents containing composition of matter claims that cover Coviracil.
BioChem Pharma filed a patent application in the United States in 1989 and
received a patent in 1991 covering a group of 1, 3-oxathiolane nucleosides, but
which did not include Coviracil. BioChem Pharma filed foreign patent
applications in 1990, which expanded upon its 1989 United States patent
application to include FTC among a large class of nucleosides. The foreign
patent applications are pending in many countries and have issued in a number of
countries with claims directed to FTC that cover Coviracil and its use to treat
HIV. In addition, BioChem Pharma filed a United States patent application in
1991 specifically directed to Coviracil. BioChem Pharma has received two patents
in the United States based on this patent application, one directed to Coviracil
and the other directed to a method for treating viral diseases with Coviracil.
The PTO has declared an interference between the latter BioChem Pharma patent
and a patent application filed by Emory. Emory may not prevail in the
interference proceeding, and the interference proceeding may also delay the
decision of the PTO regarding Emory's patent application. BioChem Pharma also
filed patent applications in many foreign countries based upon its 1991 United
States patent application and has received patents in certain countries. BioChem
Pharma may have additional patent applications pending in the United States.
In the United States, the first to invent a technology is entitled to
patent protection on that technology. For patent applications filed prior to
January 1, 1996, United States patent law provides that a party who invented a
technology outside the United States is deemed to have invented the technology
on the earlier of the date it introduced the invention in the United States or
the date it filed its patent application. In a filing with the SEC, BioChem
Pharma stated that it conducts substantially all of its research activities
outside the United States. BioChem Pharma also stated that it considers this to
be a disadvantage in obtaining United States patents as compared to companies
that mainly conduct research in the United States. We do not know whether Emory
or BioChem Pharma was the first to invent the technology claimed in their
respective United States patent applications or patents. We also do not know
whether BioChem Pharma invented the technology disclosed in its patent
applications in the United States or introduced that technology in the United
States before the date of its patent applications.
In foreign countries, the first party to file a patent application on a
technology, not the first to invent the technology, is entitled to patent
protection on that technology. We believe that Emory filed patent applications
disclosing Coviracil as a useful anti-HIV agent in many foreign countries before
BioChem Pharma filed its foreign patent applications on that technology.
However, BioChem Pharma has received patents in several foreign countries. In
addition, BioChem Pharma has filed patent applications on Coviracil and its uses
in certain countries in which Emory did not file patent applications. Emory has
opposed or otherwise challenged patent claims on Coviracil granted to BioChem
Pharma in Australia, Japan and Norway. Emory may not initiate opposition
proceedings in any
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other countries or be successful in any foreign proceeding attempting to prevent
the issuance of, revoke or limit the scope of patents issued to BioChem Pharma.
BioChem Pharma has opposed patent claims on Coviracil granted to Emory in Japan
and Australia. BioChem Pharma may make additional challenges to Emory patents or
patent applications, which Emory may not succeed in defending. Our sales of
Coviracil for the treatment of HIV may be held to infringe United States and
foreign patent rights of BioChem Pharma. Under the patent laws of most
countries, a product can be found to infringe a third party patent either if the
third party patent expressly covers the product or method of treatment using the
product, or if the third party patent covers subject matter that is
substantially equivalent in nature to the product or method, even if the patent
does not expressly cover the product or method. If it is determined that the
sale of Coviracil for the treatment of HIV infringes a BioChem Pharma patent, we
would not have the right to make, use or sell Coviracil for the treatment of HIV
in one or more countries in the absence of a license from BioChem Pharma. We may
be unable to obtain such a license from BioChem Pharma on acceptable terms or at
all.
HBV. Burroughs Wellcome Co. ("Burroughs Wellcome") filed patent
applications in March 1991 and May 1991 in Great Britain on a method to treat
HBV with FTC and purified forms of FTC, that include Coviracil. Burroughs
Wellcome filed similar patent applications in other countries, which we believe
includes the United States. Glaxo subsequently acquired Burroughs Wellcome's
rights under those patent applications. Those patent applications were filed in
foreign countries prior to the date Emory filed its patent application on the
use of Coviracil to treat HBV. Burroughs Wellcome's foreign patent applications,
therefore, have priority over those filed by Emory. In July 1996, Emory
instituted litigation against Glaxo in the United States District Court to
obtain ownership of the patent applications filed by Burroughs Wellcome,
alleging that Burroughs Wellcome converted and misappropriated Emory's invention
and property and that an Emory employee is the inventor or a co-inventor of the
subject matter covered by the Burroughs Wellcome patent applications. In May
1999, Emory and Glaxo settled the litigation, and we became the exclusive
licensee of the Unites States and all foreign patent applications and patents
filed by Burroughs Wellcome on the use of Coviracil to treat HBV, subject to
United States antitrust clearance. Pursuant to the license and settlement
agreements, Emory and we were also given access to development and clinical data
and drug substance held by Glaxo relating to Coviracil.
BioChem Pharma filed a patent application in May 1991 in Great Britain
also directed to a method to treat HBV with FTC. BioChem Pharma filed similar
patent applications in other countries. In January 1996, BioChem Pharma received
a patent in the United States, which included a claim to treat HBV with
Coviracil. The PTO has declared an interference between the BioChem Pharma
patent and a patent application filed by Yale. Yale licensed all of its rights
relating to FTC, including Coviracil, and its uses claimed in this patent
application to Emory, which subsequently licensed these rights to us. Yale may
not prevail in the interference proceeding, and the proceeding may delay the
decision of the PTO regarding Yale's patent application. In addition, the PTO
may declare interference proceedings with respect to other patent applications
filed by Emory, Burroughs Wellcome's patent application and BioChem Pharma's
issued United States patent. Emory may not pursue or succeed in any such
proceedings. We will not be able to sell Coviracil for the treatment of HBV in
the United States unless a United States court or administrative body determines
that the BioChem Pharma patent is invalid or unless we obtain a license from
BioChem Pharma. We may be unable to obtain such a license on acceptable terms or
at all In July 1991, BioChem Pharma received a United States patent on the use
of 3TC to treat HBV and has corresponding patent applications pending or issued
in foreign countries. If it is determined that the use of Coviracil to treat HBV
is not substantially different from the use of 3TC to treat HBV, a court could
hold that the use of Coviracil to treat HBV infringes these BioChem Pharma 3TC
patents.
In addition, BioChem Pharma has filed in the United States and foreign
countries several patent applications on manufacturing methods relating to a
class of nucleosides that includes Coviracil, from which BioChem Pharma has
received several patents in the United States and many foreign countries. If we
use a manufacturing method that is covered by patents issued on any of these
applications, we will not be able to manufacture Coviracil without a license
from BioChem Pharma. We may not be able to obtain such a license on acceptable
terms or at all.
DAPD
We obtained our rights to DAPD under a license from Emory and the
University of Georgia Research Foundation, Inc. ("UGARF"). Our rights to DAPD
include five issued United States patents that cover composition of matter, a
method for the synthesis of DAPD, and methods for the use of DAPD alone or in
combination with
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certain other anti-HBV agents for the treatment of HBV. We also have rights to
several foreign patents that cover methods for the use of DAPD alone or in
combination with certain other anti-HBV agents for the treatment of HBV.
Additional United States and foreign patent applications are pending which
contain claims for the use of DAPD to treat HIV. Emory and UGARF filed patent
applications claiming these inventions in the United States in 1990 and 1992.
BioChem Pharma filed a patent application in the United States in 1988 on a
group of nucleosides in the same general class as DAPD and their use to treat
HIV, and has filed corresponding patent applications in foreign countries. The
PTO issued a patent to BioChem Pharma in 1993 covering a class of nucleosides
that includes DAPD and its use to treat HIV. Corresponding patents have been
issued to BioChem Pharma in many foreign countries. Emory has filed an
opposition to patent claims granted to BioChem Pharma by the European Patent
Office based, in part, upon Emory's assertion that BioChem Pharma's patent does
not disclose how to make DAPD. In an opposition hearing held at the European
Patent Office on March 4, 1999, the Opposition Division ruled that the BioChem
Pharma European patent covering DAPD is valid. Emory has informed Triangle that
it intends to appeal this decision to the European Patent Office Technical Board
of Appeal. If the Technical Board of Appeal affirms the decision of the
Opposition Division, or if Emory or Triangle do not pursue the appeal, we would
not be able to sell DAPD in Europe without a license from BioChem Pharma, which
may not be available on acceptable terms or at all. Patent claims granted to
Emory on a portion of the DAPD technology by the Australian Patent Office have
also been opposed by BioChem Pharma. We cannot assure you that a court or
administrative body would invalidate BioChem Pharma's patent claims. Further, a
sale of DAPD by us may infringe BioChem Pharma's patents. If Emory, UGARF and we
do not challenge, or are not successful in any challenge to, BioChem Pharma's
issued patents or pending patent applications (or patents that may issue from
such applications), we will not be able to manufacture, use or sell DAPD in the
United States and any foreign countries in which BioChem Pharma receives a
patent without a license from BioChem Pharma. We may not be able to obtain such
a license from BioChem Pharma on acceptable terms or at all.
With respect to any of our drug candidates, litigation, opposition and
interference proceedings, including the currently pending proceedings, could
result in substantial costs to us. We expect the costs of the currently pending
proceedings to increase significantly during the next several years. We
anticipate that additional litigation and/or proceedings will be necessary or
may be initiated to enforce any patents we own or in-license, or to determine
the scope, validity and enforceability of other parties' proprietary rights and
the priority of an invention. Any of these activities could result in
substantial costs and/or delays to us. The outcome of any of these proceedings
may significantly affect our drug candidates and technology. United States
patents carry a presumption of validity and generally can be invalidated only
through clear and convincing evidence. As indicated above, the PTO has already
declared two interferences in connection with the emtricitabine technology. We
cannot assure you that a court or administrative body would hold our in-licensed
patents valid or would find an alleged infringer to be infringing. Further, the
license and option agreements with Emory, UGARF, The Regents of the University
of California, The DuPont Pharmaceuticals Company, and Mitsubishi Chemical
Corporation provide that each of these licensors is primarily responsible for
any patent prosecution activities, such as litigation, interference, opposition
or other actions, for the technology licensed to us. These agreements also
provide that in general we are required to reimburse these licensors for the
costs they incur in performing these activities. Similarly, Yale and UGARF, the
licensors of L-FMAU to Bukwang Pharm. Ind. Co., Ltd., are primarily responsible
for patent prosecution activities with respect to L-FMAU at our expense. As a
result, we generally do not have the ability to institute or determine the
conduct of any such patent proceedings unless our licensors elect not to
institute or to abandon such proceedings. If our licensors elect to institute
and prosecute patent proceedings, our rights will depend in part upon the manner
in which these licensors conduct the proceedings. In any proceedings they elect
to initiate and maintain, these licensors may not vigorously pursue or defend or
may decide to settle such proceedings on terms that are unfavorable to us. An
adverse outcome of these proceedings could subject us to significant liabilities
to third parties, require disputed rights to be licensed from third parties or
require us to cease using such technology, any of which could adversely affect
our business. Moreover, the mere uncertainty resulting from the initiation and
continuation of any technology related litigation or interference proceeding
could adversely affect our business pending resolution of the disputed matters.
We also rely on unpatented trade secrets and know-how to maintain our
competitive position, which we seek to protect, in part, by confidentiality
agreements with employees, consultants and others. These parties may breach or
terminate these agreements, and we may not have adequate remedies for any
breach. Our trade secrets may also be independently discovered by competitors.
We rely on certain technologies to which we do not have exclusive rights or
which may not be patentable or proprietary and thus may be available to
competitors. We have filed an application for, but have not obtained, a
trademark registration for our corporate name, corporate logo,
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<PAGE>
Coviracil(TM) and Coactinon(TM). An opposition to the European Community
trademark application for the mark Coviracil has been filed by Orsem and Les
Laboratories Serveir based on registrations in certain countries for the mark
Coversyl(R) for pharmaceuticals. We do not believe that the marks Coviracil and
Coversyl are confusingly similar. However, if we do not prevail in the
opposition, we may need to adopt a different product name for emtricitabine.
Several other companies use trade names that are similar to our name for their
businesses. If we are unable to obtain any licenses that may be necessary for
the use of our corporate name, we may be required to change our name. Our
management personnel were previously employed by other pharmaceutical companies.
The prior employers of these individuals may allege violations of trade secrets
and other similar claims relating to their drug development activities for us.
We are subject to extensive government regulation and may fail to receive
regulatory approval for our drug candidates.
The FDA and foreign regulatory authorities require rigorous preclinical
testing, clinical trials and other approval procedures for human pharmaceutical
products. Numerous regulations also govern the manufacturing, safety, labeling,
storage, record keeping, reporting and marketing of pharmaceutical products. The
requirements vary widely from country to country, and the time required to
complete preclinical testing and clinical trials and to obtain regulatory
approvals is uncertain. We expect the process of obtaining these approvals and
complying with appropriate government regulations to be time consuming and
expensive. If we replace a drug candidate in preclinical testing and/or clinical
trials with a modified drug candidate, it may extend the development period. In
addition, if the FDA or similar foreign regulatory authorities require
additional clinical trials, we could face increased costs and significant
development delays. Changes in regulatory policy or additional regulations
adopted during product development and regulatory review of information we
submit could also result in delays or rejections. The FDA has notified us that
two of our drug candidates, Coactinon and Coviracil for the treatment of HIV,
qualify for designation as "fast track" products under provisions of the Food
and Drug Administration Modernization Act of 1997. The fast track provisions are
designed to expedite the review of new drugs intended to treat serious or
life-threatening conditions and essentially codified the criteria previously
established by the FDA for accelerated approval. These drug candidates may not,
however, continue to qualify for expedited review and our other drug candidates
may fail to qualify for expedited review. Even though some of our drug
candidates have qualified for expedited review, the FDA may not approve them at
all or any sooner than other drug candidates that do not qualify for expedited
review. Further, any approval may require postmarketing studies or other
conditions. Even after substantial time and expenditures, our drug candidates
may not receive marketing approval on a timely basis or at all. If we are unable
to demonstrate the safety and effectiveness of our drug candidates to the
satisfaction of government authorities, our business will be adversely affected.
Even if our drug candidates receive regulatory approval, we may still face
difficulties in marketing and manufacturing those drug candidates. The approval
of any of our drug candidates may limit the indicated uses of the drug
candidate. A marketed product, its manufacturer and the manufacturer's
facilities are subject to continual review and periodic inspections. The
discovery of previously unknown problems with a product, manufacturer or
facility may result in restrictions on the product or manufacturer, including
withdrawal of the product from the market. The failure to comply with applicable
regulatory requirements can, among other things, result in:
o fines,
o suspended regulatory approvals,
o refusal to approve pending applications,
o refusal to permit exports from the United States,
o product recalls,
o seizure of products,
o injunctions,
o operating restrictions, and
o criminal prosecutions.
Governmental regulation may significantly delay the marketing of our drug
candidates, prevent such marketing altogether, impose costly requirements on our
activities or provide our competitors with an advantage in the market. Adverse
clinical results by others could negatively impact the development and approval
of our drug candidates. Some of our drug candidates are intended for use as
coactive therapy with one or more other drugs, and adverse safety, effectiveness
or regulatory developments in connection with such other drugs will also have an
adverse effect on our business. A delay in obtaining or failure to obtain
regulatory approvals for any of our drug candidates will have an adverse effect
on our business. We cannot predict the adverse effects that future government
regulations may have on our business.
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We are also subject to various federal, state and local laws and
regulations relating to safe working conditions, laboratory and manufacturing
practices, the experimental use of animals and the use and disposal of hazardous
or potentially hazardous substances, including radioactive compounds and
infectious disease agents, used in connection with our development work.
Intense competition may render our drug candidates noncompetitive or obsolete.
We are engaged in segments of the drug industry that are highly
competitive and rapidly changing. Any of our current drug candidates that we
successfully develop will compete with numerous existing therapies. In addition,
many companies are pursuing novel drugs that target the same diseases we are
targeting. We believe that a significant number of drugs are currently under
development and will become available in the future for the treatment of HIV,
HBV and cancer. We anticipate that we will face intense and increasing
competition as new products enter the market and advanced technologies become
available. Our competitors' products may be more effective, or more effectively
marketed and sold, than any of our products. Competitive products may render our
products obsolete or noncompetitive before we can recover the expenses of
developing and commercializing our drug candidates. Furthermore, the development
of a cure or new treatment methods for the diseases we are targeting could
render our drug candidates noncompetitive, obsolete or uneconomical. Many of our
competitors:
o have significantly greater financial, technical and human resources
than we have and may be better equipped to develop, manufacture and
market products,
o have extensive experience in preclinical testing and clinical
trials, obtaining regulatory approvals and manufacturing and
marketing pharmaceutical products, and
o have products that have been approved or are in late stage
development and operate large, well-funded research and development
programs.
Smaller companies may also prove to be significant competitors,
particularly through collaborative arrangements with large pharmaceutical and
biotechnology companies. Academic institutions, governmental agencies and other
public and private research organizations are also becoming increasingly aware
of the commercial value of their inventions and are more actively seeking to
commercialize the technology they have developed.
If we successfully develop and obtain approval for our drug candidates, we
will face competition based on the safety and effectiveness of our products, the
timing and scope of regulatory approvals, the availability of supply, marketing
and sales capability, reimbursement coverage, price, patent position and other
factors. Our competitors may develop or commercialize more effective or more
affordable products, or obtain more effective patent protection, than we do.
Accordingly, our competitors may commercialize products more rapidly or
effectively than we do, which could hurt our competitive position and adversely
affect our business.
We face risks related to our license and option agreements which could adversely
affect our business.
We have in-licensed or obtained an option to in-license our drug
candidates pursuant to agreements with our licensors. These agreements permit
our licensors to terminate the agreements under certain circumstances, such as
our failure to achieve certain development milestones or the occurrence of an
uncured material breach by us. The termination of any of these agreements could
result in the loss of our rights to a drug candidate. Upon termination of most
of our license agreements, we are required to return the licensed technology to
our licensors. In addition, most of these agreements provide that our licensors
are primarily responsible for any patent prosecution activities, such as
litigation, interference, opposition or other actions, for the technology
licensed to us. These agreements also provide that in general we are required to
reimburse our licensors for the costs they incur in performing these activities.
We believe that these costs as well as other costs under our license and option
agreements will be substantial and may increase significantly during the next
several years. Our inability or failure to pay any of these costs with respect
to any drug candidate could result in the termination of the license or option
agreement for the drug candidate. Any such termination could have an adverse
effect on our business.
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We may be unable to successfully manufacture our drug candidates.
We do not have any internal manufacturing capacity and we rely on third
party manufacturers for the manufacture of all of our clinical trial material.
We plan to expand our existing relationships or to establish relationships with
additional third party manufacturers for products that we successfully develop.
The Abbott Alliance provides that we will negotiate a manufacturing agreement
with Abbott Laboratories to set forth the circumstances in which Abbott will
manufacture a portion of our product requirements for products that we
successfully develop. We may be unable to establish or maintain relationships
with third party manufacturers on acceptable terms, and third party
manufacturers may be unable to manufacture products in commercial quantities on
a cost effective basis. Our dependence upon third parties for the manufacture of
our products may adversely affect our profit margins and our ability to develop
and commercialize products on a timely and competitive basis. Further, third
party manufacturers may encounter manufacturing or quality control problems in
connection with the manufacture of our products and may be unable to maintain
the necessary governmental licenses and approvals to continue manufacturing our
products. Our business could be adversely affected if we fail to establish or
maintain relationships with third parties for our manufacturing requirements on
acceptable terms.
We may be unable to successfully market, sell or distribute our drug candidates.
In the United States, we currently intend to market the drug candidates
covered by the Abbott Alliance in collaboration with Abbott Laboratories and to
market other drug candidates that we successfully develop (which do not become
part of the Abbott Alliance) through a direct sales force. Outside of the United
States, we expect Abbott Laboratories to market drug candidates covered by the
Abbott Alliance and, for any other drug candidates that we successfully develop
(which do not become part of the Abbott Alliance), we intend to market and sell
through arrangements or collaborations with third parties. In addition, we
expect Abbott Laboratories to handle the distribution and sale of drug
candidates covered by the Abbott Alliance both inside and outside the United
States. We do not currently possess the resources necessary to commercialize any
of our drug candidates and, therefore, if the Abbott Alliance is not
consummated, we will be required to seek collaborations or arrangements with
other third parties to market and sell our drug candidates. There can be no
assurance that the Abbott Alliance will be consummated. With respect to the
United States, our ability to market the drug candidates that we successfully
develop will be contingent upon recruitment, training and deployment of a sales
and marketing force as well as the performance of Abbott Laboratories under the
Abbott Alliance. We may be unable to establish marketing or sales capabilities
or to maintain arrangements or enter into new arrangements with third parties to
perform those activities on favorable terms. In addition, any such third parties
may have significant control or influence over important aspects of the
commercialization of our drug candidates, including market identification,
marketing methods, pricing, composition of sales force and promotional
activities. We also may have limited control over the amount and timing of
resources that a third party may devote to our drug candidates. Our business
could be adversely affected if we fail to establish or maintain a sales force
and marketing, sales and distribution capabilities.
Our dependence on third parties for the development and acquisition of drug
candidates could adversely affect our business.
We have engaged and intend to continue to engage third party contract
research organizations and other third parties ("CROs") to help us develop our
drug candidates. Although we have designed the clinical trials for our drug
candidates, the CROs have conducted many of the clinical trials. As a result,
many important aspects of our drug development programs have been and will
continue to be outside of our direct control. In addition, the CROs may not
perform all of their obligations under arrangements with us. If the CROs do not
perform clinical trials in a satisfactory manner or breach their obligations to
us, the development and commercialization of any drug candidate may be delayed
or precluded. We do not intend to engage in drug discovery. Our strategy for
obtaining additional drug candidates is to utilize the relationships of our
management team and Scientific Advisory Board to identify drug candidates for
in-licensing from companies, universities, research institutions and other
organizations. We may not succeed in acquiring additional drug candidates on
acceptable terms or at all.
If we are not able to attract and retain key personnel and advisors, it could
harm our business.
We are highly dependent on our senior management and scientific staff,
including Dr. David Barry, our Chairman and Chief Executive Officer. We have
entered into employment agreements with each officer of the Company. Dr. Barry's
employment agreement contains certain non-competition provisions. In addition,
the employment agreements for each of the other officers provide for certain
severance payments which are contingent
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upon the officer's refraining from competition with the Company. The loss of the
services of any member of our senior management or scientific staff may
significantly delay or prevent the achievement of product development and other
business objectives. Our ability to attract and retain qualified personnel,
consultants and advisors is critical to our success. In order to pursue our drug
development programs and marketing plans, we will need to hire additional
qualified scientific and management personnel. Competition for qualified
individuals is intense and we face competition from numerous pharmaceutical and
biotechnology companies, universities and other research institutions. We may be
unable to attract and retain these individuals, and our failure to do so would
have an adverse effect on our business. In addition, we rely on members of our
Scientific Advisory Board for assistance in formulating our drug development
strategy. All of the members of the Scientific Advisory Board are employed by
other employers and any such member may have commitments to, or consulting or
advisory contracts with, other entities that may limit their availability to us.
Health care reform measures and third party reimbursement practices are
uncertain and my adversely impact the commercialization of our products.
The efforts of governments and third party payors to contain or reduce the
cost of health care will continue to affect the business and financial condition
of drug companies. A number of legislative and regulatory proposals to change
the health care system have been proposed in recent years. In addition, an
increasing emphasis on managed care in the United States has and will continue
to increase pressure on drug pricing. While we cannot predict whether
legislative or regulatory proposals will be adopted or what effect those
proposals or managed care efforts may have on our business, the announcement
and/or adoption of such proposals or efforts could have an adverse effect on our
profit margins and financial condition. Sales of prescription drugs depend
significantly on the availability of reimbursement to the consumer from third
party payors, such as government and private insurance plans. These third party
payors frequently require that drug companies give them predetermined discounts
from list prices, and they are increasingly challenging the prices charged for
medical products and services. Present coactive treatment regimens for the
treatment of HIV are expensive (published reports indicate the cost per patient
per year can exceed $13,000), and may increase as new combinations are
developed. These costs have resulted in limitations in the reimbursement
available from third party payors for the treatment of HIV infection, and we
expect that reimbursement pressures will continue in the future. If we succeed
in bringing one or more products to the market, these products may not be
considered cost effective and reimbursement to the consumer may not be available
or sufficient to allow us to sell our products on a competitive basis.
If our drug candidates do not achieve market acceptance, it could harm our
business.
Our success will depend on the market acceptance of any products we
develop. The degree of market acceptance will depend upon a number of factors,
including the receipt and scope of regulatory approvals, the establishment and
demonstration in the medical community of the safety and effectiveness of our
products and their potential advantages over existing treatment methods, and
reimbursement policies of government and third party payors. Physicians,
patients, payors or the medical community in general may not accept or utilize
any product that we may develop.
If we fail to be Year 2000 compliant, it could harm our business.
The Year 2000 issue is the result of date-sensitive devices, systems and
computer programs that use a two digit rather than a four digit recognition
system to define an applicable year. We have initiated a program and task force
to assess the Year 2000 compliance of our systems and the systems of our key
business vendors. We have inventoried and assessed our significant internal
information and operation systems, and we have replaced or modified those
portions of our software, hardware and other equipment which we have determined
are non-compliant. We have completed the required changes to our critical
internal systems and anticipate the testing and verification of these modified
systems to be completed by June 30, 1999. We plan to complete the testing and
verification of all other significant internal systems by September 30, 1999.
Accordingly, we expect that the Year 2000 issue will not pose significant
operational problems for our internal systems and equipment. If, however, we are
unable to fix any technologies utilizing a two digit recognition system, we
could experience system failures or miscalculations causing disruption of
operations, including the temporary inability to process transactions or conduct
normal business activities in the new millennium.
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We are also assessing our key business vendors' Year 2000 compliance. We
have requested information from these vendors regarding their compliance efforts
and written assurances of their Year 2000 compliance. We currently plan to
complete our risk assessments, readiness evaluations and action and contingency
plans related to these vendors by September 30, 1999. However, it is extremely
difficult to assess the likelihood of these third parties' Year 2000 compliance
or the impact their noncompliance may have on our operations. If we fail to
implement successfully our Year 2000 compliance plan, our business could be
adversely affected. In addition, significant delays or unanticipated Year 2000
issues with key business vendors could adversely affect the development of our
drug candidates and our financial condition.
The projected incremental expenditures associated with our Year 2000
compliance program are not expected to be material to our consolidated financial
position, results of operations, and cash flow. We anticipate that the total
external cost of the Year 2000 project will be less than $200,000, including the
replacement, testing and implementation of all software and hardware. We are
expensing the Year 2000 compliant costs as incurred. The aggregate cost and
dates on which we expect aspects of the Year 2000 project to be completed are
based upon our best estimates and were derived utilizing assumptions of future
events, continued availability of certain internal and external resources, and
other factors.
We may not have adequate insurance protection against product liability.
Our business exposes us to potential product liability risks that are
inherent in the testing, manufacturing and marketing of drug products and we may
face product liability claims in the future. We currently have only limited
product liability insurance relating to potential claims arising from our
clinical trials. We intend to expand our insurance coverage if and when we begin
marketing commercial products. We may, however, be unable to obtain additional
product liability insurance on commercially acceptable terms. In addition, we
may be unable to maintain our existing insurance and/or any additional insurance
we may obtain in the future at a reasonable cost or in sufficient amounts to
protect against potential losses. A successful product liability claim or series
of claims brought against us could have an adverse effect on our business.
We may incur substantial costs related to our use of hazardous materials.
We use hazardous materials, chemicals, viruses and various radioactive
compounds in our drug development programs. Although we believe that our
handling and disposing of these materials comply with state and federal
regulations, the risk of accidental contamination or injury still exists. In the
event of such an accident, we could be held liable for any damages or fines that
result and any such liability could exceed our resources.
Our controlling stockholders may make decisions which you do not consider to be
in your best interest.
As of June 1, 1999, our directors, executive officers and their respective
affiliates owned approximately 27% of our outstanding Common Stock (excluding
shares of Common Stock issuable upon the closing of the Abbott Alliance). As a
result, these stockholders are able to significantly influence all matters
requiring stockholder approval, including the election of directors and the
approval of significant corporate transactions. This concentration of ownership
could also delay or prevent a change in control of Triangle that may be favored
by other stockholders.
The market price of our stock may be adversely affected by market volatility.
The market price of our Common Stock is likely to be volatile and could
fluctuate widely in response to many factors, including:
o announcements of the results of clinical trials,
o developments with respect to patents or proprietary rights,
o announcements of technological innovations by us or our competitors,
o announcements of new products or new contracts by us or our
competitors,
o actual or anticipated variations in our operating results due to the
level of development expenses and other factors,
o changes in financial estimates by securities analysts and whether
our
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earnings meet or exceed such estimates,
o conditions and trends in the pharmaceutical and other industries,
o new accounting standards,
o general market conditions and other factors, and
o the occurrence of any the risks described in these "Risk Factors."
In addition, if our stockholders sell a substantial number of shares of
our Common Stock in the public market, the market price of our Common Stock
could be reduced. As of June 1, 1999, there were 30,734,819 shares of Common
Stock outstanding, of which a majority were immediately eligible for resale in
the public market without restriction. Holders of approximately 14,000,000 of
these shares (including the shares registered under this registration statement
but excluding shares of Common Stock issuable upon the closing of the Abbott
Alliance, if consummated) have rights to cause us to register these shares for
sale to the public. We have filed registration statements to register the sale
of approximately 9,000,000 of these shares (including the shares registered
under this registration statement). Any such sales may make it more difficult
for us to raise needed capital through an offering of our equity or convertible
debt securities and may reduce the market price of our Common Stock.
Further, the stock market has experienced extreme price and volume
fluctuations that have particularly affected the market prices of equity
securities of many companies in our industry. Often, these fluctuations have
been unrelated or disproportionate to the operating performance of such
companies. These market fluctuations, as well as general economic, political and
market conditions such as recessions or international currency fluctuations, may
reduce the market price of our Common Stock. In the past, following periods of
volatility in the market price of the securities of companies in our industry,
securities class action litigation has often been instituted against those
companies. If we face such litigation in the future, it would result in
substantial costs and a diversion of management attention and resources, which
would negatively impact our business.
Antitakeover provisions in our charter documents and Delaware law could delay,
defer or prevent a tender offer or takeover attempt that you consider to be in
your best interest.
We have adopted a number of provisions that could have antitakeover
effects. On January 29, 1999, our Board adopted a preferred stock purchase
rights plan, commonly referred to as a "poison pill." The rights plan is
intended to deter an attempt to acquire the Company in a manner or on terms not
approved by the Board. Thus, the rights plan will not prevent an acquisition of
the Company which is approved by the Board. Our charter authorizes our Board to
issue shares of undesignated preferred stock without stockholder approval on
terms as the Board may determine. Moreover, the issuance of preferred stock may
make it more difficult for a third party to acquire, or may discourage a third
party from acquiring, voting control of Triangle. Our bylaws divide the Board
into three classes of directors with each class serving a three year term. These
and other provisions of our charter and our bylaws, as well as certain
provisions of Delaware law, could delay or impede the removal of incumbent
directors and could make more difficult a merger, tender offer or proxy contest
involving Triangle, even if the events could be beneficial to our stockholders.
These provisions could also limit the price that investors might be willing to
pay for our Common Stock.
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of the shares by the
selling stockholders.
SELLING STOCKHOLDERS
We are registering all 1,700,000 shares of Common Stock covered by this
prospectus on behalf of the selling stockholders named in the table below. We
issued all of the shares to the selling stockholders upon the conversion of
shares of Triangle's Series A Preferred Stock held by such selling stockholders.
We issued such preferred stock to the selling stockholders in a private
placement transaction on December 24, 1998. We have registered the shares of
Common Stock to permit the selling stockholders and their pledgees, donees,
transferees or other successors-in-interest that receive their shares from a
selling stockholder as a gift, partnership distribution or other non-sale
related transfer after the date of this prospectus (collectively, the "Selling
Stockholders") to resell the shares when they deem appropriate.
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The following table sets forth the name of each of the Selling
Stockholders, the number of shares owned by each of the Selling Stockholders,
the number of shares that may be offered under this prospectus, and the number
of shares of our Common Stock owned by each of the Selling Stockholders after
this offering is completed. Except as set forth in the table below, none of the
Selling Stockholders has had a material relationship with us within the past
three years other than as a result of the ownership of the shares or other
securities of Triangle. The number of shares in the column "Number of Shares
Being Offered" represent all of the shares that each Selling Stockholder may
offer under this prospectus. We do not know how long the Selling Stockholders
will hold the shares before selling them and we currently have no agreements,
arrangements or understandings with any of the Selling Stockholders regarding
the sale of any of the shares. The shares offered by this prospectus may be
offered from time to time by the Selling Stockholders named below.
<TABLE>
<CAPTION>
Shares Shares
Beneficially Owned Beneficially Owned
Prior to Offering Number of After Offering
------------------------ Shares Being -----------------------
Name of Selling Stockholder Number (1) Percent (2) Offered (3) Number (1) Percent (2)
--------------------------- ---------- ----------- ----------- ---------- -----------
<S> <C> <C> <C> <C> <C>
Entities affiliated with Alta BioPharma
Partners, L.P.(4) .................................. 1,000,000 3.3% 1,000,000 0 *
One Embarcadero Center, Suite 4050
San Francisco, CA 94111
Chase Venture Capital Associates, L.P. ............... 700,000 2.3% 700,000 0 *
c/o Chase Capital Partners --------- --------- ---
380 Madison Avenue
New York, NY 10017
TOTAL 1,700,000 1,700,000 0
</TABLE>
- ----------
* Represents beneficial ownership of less than 1%.
(1) Unless otherwise indicated, each person has sole investment and voting
power with respect to the shares listed in the table, subject to community
property laws, where applicable. For purposes of this table, a person or
group of persons is deemed to have "beneficial ownership" of any shares
which such person has the right to acquire within 60 days.
(2) Percentage ownership is based on 30,734,819 shares of Common Stock of
Triangle outstanding on June 1, 1999 (excluding shares of Common Stock
issuable upon the closing of the Abbott Alliance). For purposes of
computing the percentage of outstanding shares held by each person or
group of persons named above, any security which such person or group of
persons has the right to acquire within 60 days is deemed to be
outstanding for the purpose of computing the percentage ownership for such
person or persons, but is not deemed to be outstanding for the purpose of
computing the percentage ownership of any other person.
(3) This registration statement shall also cover any additional shares of
Common Stock which become issuable in connection with the shares
registered for sale hereby as a result of any stock dividend, stock split,
recapitalization or other similar transaction effected without the receipt
of consideration which results in an increase in the number of Triangle's
outstanding shares of Common Stock.
(4) Includes 621,590 shares beneficially owned by Alta BioPharma Partners,
L.P., 354,990 shares beneficially owned by Triangle Pharmaceuticals Chase
Partners (AltaBio), LLC, and 23,420 shares beneficially owned by Alta
Embarcadero BioPharma, LLC.
PLAN OF DISTRIBUTION
The Selling Stockholders may sell the shares from time to time. The
Selling Stockholders will act independently of us in making decisions regarding
the timing, manner and size of each sale. The sales may be made on one or more
exchanges or 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 in
negotiated transactions. The Selling Stockholders may effect such transactions
by selling the shares to or through broker-dealers. The shares may be sold by
one or more of, or a combination of, the following:
o a block trade in which the broker-dealer 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 purchases by a broker-dealer as principal and resale by such
broker-dealer for its account pursuant to this prospectus,
o an exchange distribution in accordance with the rules of such
exchange,
o ordinary brokerage transactions and transactions in which the broker
solicits purchasers, and
o in privately negotiated transactions.
15
<PAGE>
To the extent required, this prospectus may be amended or supplemented
from time to time to describe a specific plan of distribution. In effecting
sales, broker-dealers engaged by the Selling Stockholders may arrange for other
broker-dealers to participate in the resales.
The Selling Stockholders may enter into hedging transactions with
broker-dealers in connection with distributions of the shares or otherwise. In
these transactions, broker-dealers may engage in short sales of the shares in
the course of hedging the positions they assume with Selling Stockholders. The
Selling Stockholders also may sell shares short and redeliver the shares to
close out such short positions. The Selling Stockholders may enter into option
or other transactions with broker-dealers which require the delivery to the
broker-dealer of the shares. The broker-dealer may then resell or otherwise
transfer such shares pursuant to this prospectus. The Selling Stockholders also
may loan or pledge the shares to a broker-dealer. The broker-dealer may sell the
shares so loaned, or upon a default the broker-dealer may sell the pledged
shares pursuant to this prospectus.
Broker-dealers or agents may receive compensation in the form of
commissions, discounts or concessions from Selling Stockholders. Broker-dealers
or agents may also receive compensation from the purchasers of the shares for
whom they act as agents or to whom they sell as principals, or both.
Compensation as to a particular broker-dealer might be in excess of customary
commissions and will be in amounts to be negotiated in connection with the sale.
Broker-dealers or agents and any other participating broker-dealers or the
Selling Stockholders may be deemed to be "underwriters" within the meaning of
Section 2(11) of the Securities Act of 1933, as amended (the "Securities Act"),
in connection with sales of the shares. Accordingly, any such commission,
discount or concession received by them and any profit on the resale of the
shares purchased by them may be deemed to be underwriting discounts or
commissions under the Securities Act. Because Selling Stockholders may be deemed
to be "underwriters" within the meaning of Section 2(11) of the Securities Act,
the Selling Stockholders will be subject to the prospectus delivery requirements
of the Securities Act. In addition, any securities covered by this prospectus
which qualify for sale pursuant to Rule 144 promulgated under the Securities Act
may be sold under Rule 144 rather than pursuant to this prospectus. The Selling
Stockholders have advised us that they have not entered into any agreements,
understandings or arrangements with any underwriters or broker-dealers regarding
the sale of their securities. There is no underwriter or coordinating broker
acting in connection with the proposed sale of shares by the Selling
Stockholders.
The shares will be sold only through registered or licensed brokers or
dealers if required under applicable state securities laws. In addition, in
certain states the shares may not be sold unless they have been registered or
qualified for sale in the applicable state or an exemption from the registration
or qualification requirement is available and is complied with.
Under applicable rules and regulations under the Exchange Act, any person
engaged in the distribution of the shares may not simultaneously engage in
market making activities with respect to our Common Stock for a period of two
business days prior to the commencement of such distribution. In addition, each
Selling Stockholder will be subject to applicable provisions of the Exchange Act
and the associated rules and regulations under the Exchange Act, including
Regulation M, which provisions may limit the timing of purchases and sales of
shares of our Common Stock by the Selling Stockholders. We will make copies of
this prospectus available to the Selling Stockholders and have informed them of
the need to deliver copies of this prospectus to purchasers at or prior to the
time of any sale of the shares.
16
<PAGE>
We will file a supplement to this prospectus, if required, pursuant to
Rule 424(b) under the Securities Act upon being notified by a Selling
Stockholder that any material arrangements have been entered into with a
broker-dealer for the sale of shares through a block trade, special offering,
exchange distribution or secondary distribution or a purchase by a broker or
dealer, such supplement will disclose:
o the name of each such Selling Stockholder and of the participating
broker-dealer(s),
o the number of shares involved,
o the price at which such shares were sold,
o the commissions paid or discounts or concessions allowed to such
broker-dealer(s), where applicable,
o that such broker-dealer(s) did not conduct any investigation to
verify the information set out or incorporated by reference in this
prospectus, and
o other facts material to the transaction.
In addition, upon being notified by a Selling Stockholder that a donee or
pledgee intends to sell more than 500 shares, we will file a supplement to this
prospectus.
We will bear all costs, expenses and fees in connection with the
registration of the shares. The Selling Stockholders will bear all commissions
and discounts, if any, attributable to the sales of the shares. The Selling
Stockholders may agree to indemnify any broker-dealer or agent that participates
in transactions involving sales of the shares against certain liabilities,
including liabilities arising under the Securities Act. The Selling Stockholders
have agreed to indemnify certain persons, including broker-dealers and agents,
against certain liabilities in connection with the offering of the shares,
including liabilities arising under the Securities Act.
LEGAL MATTERS
For purposes of this offering, Brobeck, Phleger & Harrison LLP, San Diego,
California, is giving its opinion as to the validity of the shares. Members of
such firm own a total of 13,333 shares of Triangle's Common Stock.
EXPERTS
The financial statements incorporated herein by reference to the Annual
Report on Form 10-K of the Company for the year ended December 31, 1998, have
been so incorporated in reliance on the report of PricewaterhouseCoopers LLP,
independent accountants, given on the authority of that firm as experts in
auditing and accounting.
17
<PAGE>
We have not authorized any person to make a statement that differs from what is
in this prospectus. If any person does make a statement that differs from what
is in this prospectus, you should not rely on it. This prospectus is not an
offer to sell, nor is it an offer to buy, these securities in any state in which
the offer or sale is not permitted. The information in this prospectus is
complete and accurate as of its date, but the information may change after that
date.
TABLE OF CONTENTS
Page
----
WHERE YOU CAN FIND MORE
INFORMATION ............................................................... 2
INFORMATION INCORPORATED BY
REFERENCE ................................................................. 2
THE COMPANY ............................................................... 3
RECENT DEVELOPMENTS ....................................................... 3
RISK FACTORS .............................................................. 3
USE OF PROCEEDS ........................................................... 14
SELLING STOCKHOLDERS ...................................................... 14
PLAN OF DISTRIBUTION ...................................................... 15
LEGAL MATTERS ............................................................. 17
EXPERTS ................................................................... 17
1,700,000 Shares
TRIANGLE
PHARMACEUTICALS, INC.
Common Stock
----------------------
Prospectus
----------------------
June ____, 1999
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses Of Issuance And Distribution.
The following table sets forth all expenses, other than underwriting
discounts and commissions, payable by the Registrant in connection with the sale
of the common stock being registered. All the amounts shown are estimates,
except for the registration fee.
Registration Fee ................................... $ 7,798
Printing and engraving expenses .................... 10,000
Legal fees and expenses ............................ 5,000
Accounting fees and expenses ....................... 1,000
Transfer Agent and Registrar Fees .................. 1,000
Miscellaneous Expenses ............................. 1,000
-------
TOTAL ................................. $25,798
=======
Item 15. Indemnification Of Officers And Directors.
Section 145 of the Delaware General Corporation Law permits
indemnification of officers and directors of the Company under certain
conditions and subject to certain limitations. Section 145 of the Delaware
General Corporation Law also provides that a corporation has the power to
purchase and maintain insurance on behalf of its officers and directors against
any liability asserted against such person and incurred by him or her in such
capacity, or arising out of his or her status as such, whether or not the
corporation would have the power to indemnify him or her against such liability
under the provisions of Section 145 of the Delaware General Corporation Law.
Article VII, Section (i) of the Restated Bylaws of the Company provides
that the Company shall indemnify its directors and executive officers to the
fullest extent not prohibited by the Delaware General Corporation Law. The
rights to indemnity thereunder continue as to a person who has ceased to be a
director, officer, employee or agent and inure to the benefit of the heirs,
executors and administrators of the person. In addition, expenses incurred by a
director or officer in defending any civil, criminal, administrative or
investigative action, suit or proceeding by reason of the fact that he or she is
or was a director or officer of the Company (or was serving at the Company's
request as a director or officer of another corporation) shall be paid by the
Company in advance of the final disposition of such action, suit or proceeding
upon receipt of an undertaking by or on behalf of such director or officer to
repay such amount if it shall ultimately be determined that he or she is not
entitled to be indemnified by the Company as authorized by the relevant section
of the Delaware General Corporation Law.
As permitted by Section 102(b)(7) of the Delaware General Corporation Law,
Article 5, Section (a) of the Company's Second Restated Certificate of
Incorporation provides that a director of the Company shall not be personally
liable for monetary damages for breach of fiduciary duty as a director, except
for liability (i) for any breach of the director's duty of loyalty to the
Company or its stockholders, (ii) for acts or omissions not in good faith or
acts or omissions that involve intentional misconduct or a knowing violation of
law, (iii) under Section 174 of the Delaware General Corporation Law or (iv) for
any transaction from which the director derived any improper personal benefit.
The Company has entered into indemnification agreements with its directors
and executive officers. Generally, the indemnification agreements attempt to
provide the maximum protection permitted by Delaware law as it may be amended
from time to time. Under such additional indemnification provisions, however, an
individual will not receive indemnification for judgments, settlements or
expenses if he or she is found liable to the Company (except to the extent the
court determines he or she is fairly and reasonably entitled to indemnity for
expenses), for settlements not approved by the Company or for settlements and
expenses if the settlement is not approved by the court. The indemnification
agreements provide for the Company to advance to the individual any and all
reasonable expenses (including legal fees and expenses) incurred in
investigating or defending any such action, suit or
II-1
<PAGE>
proceeding. In order to receive an advance of expenses, the individual must
submit to the Company copies of invoices presented to him or her for such
expenses. Also, the individual must repay such advances upon a final judicial
decision that he or she is not entitled to indemnification.
The Registrant has an insurance policy covering the directors and officers
of the Registrant with respect to certain liabilities, including liabilities
arising under the Securities Act or otherwise.
Item 16. Exhibits And Financial Statement Schedules.
(a) Exhibits.
Exhibit No. Description
----------- -----------
4.1 Instruments defining the rights of stockholders. Reference
is made to the Registration Statement on Form 8-A, filed
October 18, 1996, and the Registration Statement on Form
8-A, filed February 10, 1999, as amended on June 18, 1999.
5.1 Opinion of Brobeck, Phleger & Harrison LLP
23.1 Consent of PricewaterhouseCoopers LLP, Independent
Accountants
23.2 Consent of Brobeck, Phleger & Harrison LLP. Reference is
made to Exhibit 5.1
24.1 Power of Attorney. Reference is made to page II-4.
Item 17. Undertakings.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement to include any material
information with respect to the plan of distribution not previously disclosed in
the registration statement or any material change to such information in the
registration statement;
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof;
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(4) If the registrant is a foreign private issuer, to file a
post-effective amendment to the registration statement to include any financial
statements required by Rule 3-19 of Regulation S-X at the state of any delayed
offering or throughout a continuous offering. Financial statements and
information otherwise required by Section 10(a)(3) of the Act need not be
furnished, provided, that the registrant includes in the prospectus, by means of
a post-effective amendment, financial statements required pursuant to this
paragraph (a)(4) and other information necessary to ensure that all other
information in the prospectus is at least as current as the date of those
financial statements. Notwithstanding the foregoing, with respect to
registration statements on Form F-3, a post-effective amendment need not be
filed to include financial statements and information required by Section
10(a)(3) of the Act or Rule 3-19 of this chapter if such financial statements
and information are contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to section 13 or section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the Form
F-3.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Act, each filing of the Registrant's annual
report pursuant to Section 13(a) or Section
II-2
<PAGE>
15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing
of an employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
The undersigned Registrant hereby undertakes to deliver or cause to be
delivered with the Prospectus, to each person to whom the Prospectus is sent or
given, the latest annual report to security holders that is incorporated by
reference in the Prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or Rule 14c-3 under the Securities Exchange Act of
1934; and, where interim financial information required to be presented by
Article 3 of Regulation S-X are not set forth in the Prospectus, to deliver, or
cause to be delivered to each person to whom the Prospectus is sent or given,
the latest quarterly report that is specifically incorporated by reference in
the Prospectus to provide such interim financial information.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Company pursuant to the foregoing provisions, Delaware Corporation law, the
Underwriting Agreement 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 Act and is, therefor, 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 hereunder,
the Registrant will, unless in the opinion of its counsel the question has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question of whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Durham, State of North Carolina, on the 28th day of
June, 1999.
TRIANGLE PHARMACEUTICALS, INC.
By: /s/ David W. Barry
------------------------------------
David W. Barry
Chairman and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints, jointly and severally, David W.
Barry and James A. Klein, Jr., and each of them acting individually, as his
attorney-in-fact, each with full power of substitution and resubstitution, for
him or her in any and all capacities, to sign any and all amendments to this
Registration Statement (including post-effective amendments), and to file the
same, with exhibits thereto and other documents in connection therewith, with
the Securities and Exchange Commission, granting unto said attorneys-in-fact
full power and authority to do and perform each and every act and thing
requisite and necessary to be done in connection therewith as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact, or their substitute or substitutes,
may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:
<TABLE>
<CAPTION>
Signature Title
--------- -----
<S> <C> <C>
/s/ David W. Barry Chairman of the Board and Chief Executive June 28, 1999
- ------------------------------------ Officer (Principal Executive Officer)
David W. Barry
/s/ James A. Klein, Jr Chief Financial Officer and Treasurer June 28, 1999
- ------------------------------------ (Principal Financial and Accounting Officer)
James A. Klein, Jr.
/s/ M. Nixon Ellis Director, President and June 28, 1999
- ------------------------------------ Chief Operating Officer
M. Nixon Ellis
Director June ____, 1999
- ------------------------------------
Anthony B. Evnin
/s/ Standish M. Fleming Director June 28, 1999
- ------------------------------------
Standish M. Fleming
/s/ Dennis B. Gillings Director June 28, 1999
- ------------------------------------
Dennis B. Gillings
/s/ Henry G. Grabowski Director June 28, 1999
- ------------------------------------
Henry G. Grabowski
/s/ George McFadden Director June 28, 1999
- ------------------------------------
George McFadden
</TABLE>
II-4
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
----------- -----------
4.1 Instruments defining the rights of stockholders. Reference
is made to the Registration Statement on Form 8-A, filed
October 18, 1996, and the Registration Statement on Form
8-A, filed February 10, 1999, as amended on June 18, 1999.
5.1 Opinion of Brobeck, Phleger & Harrison LLP
23.1 Consent of PricewaterhouseCoopers LLP, Independent
Accountants
23.2 Consent of Brobeck, Phleger & Harrison LLP. Reference is
made to Exhibit 5.1
24.1 Power of Attorney. Included on page II-4 of this
registration statement.
Exhibit 5.1
Opinion of Brobeck, Phleger & Harrison LLP
June 28, 1999
Triangle Pharmaceuticals, Inc.
4 University Place
4611 University Drive
Durham, North Carolina 27707
Re: Triangle Pharmaceuticals, Inc. Registration Statement on Form S-3 for
Resale of 1,700,000 Shares of Common Stock
Ladies and Gentlemen:
We have acted as counsel to Triangle Pharmaceuticals, Inc., a Delaware
corporation (the "Company"), in connection with the registration for resale of
1,700,000 shares of Common Stock (the "Shares"), as described in the Company's
Registration Statement on Form S-3 (the "Registration Statement") filed with the
Securities and Exchange Commission under the Securities Act of 1933, as amended
(the "Act").
This opinion is being furnished in accordance with the requirements of
Item 1b of Form S-3 and Item 601(b)(5)(i) of Regulation S-K.
We have reviewed the Company's charter documents, the corporate
proceedings taken by the Company in connection with the original issuance and
sale of the Shares, and a certificate of a Company officer regarding (among
other things) the Company's receipt of consideration upon the original issuance
and sale of the Shares. Based on such review, we are of the opinion that the
Shares are duly authorized, validly issued, fully paid and nonassessable.
We consent to the filing of this opinion as Exhibit 5.1 to the
Registration Statement and to the reference to this firm under the caption
"Legal Matters" in the prospectus which is part of the Registration Statement.
In giving this consent, we do not thereby admit that we are within the category
of persons whose consent is required under Section 7 of the Act, the rules and
regulations of the Securities and Exchange Commission promulgated thereunder, or
Item 509 of Regulation S-K.
<PAGE>
This opinion letter is rendered as of the date first written above and we
disclaim any obligation to advise you of facts, circumstances, events or
developments which hereafter may be brought to our attention and which may
alter, affect or modify the opinion expressed herein. Our opinion is expressly
limited to the matters set forth above and we render no opinion, whether by
implication or otherwise, as to any other matters relating to the Company or the
Shares.
Very truly yours,
BROBECK, PHLEGER & HARRISON LLP
Exhibit 23.1
Consent of Independent Accountants
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report dated
February 5, 1999 appearing on page 43 of Triangle Pharmaceuticals, Inc.'s Annual
Report on Form 10-K for the year ended December 31, 1998. We also consent to the
reference to us under the heading "Experts."
PRICEWATERHOUSECOOPERS LLP
Raleigh, North Carolina
June 28, 1999
