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[SPI PHARMACEUTICALS INC. LETTERHEAD]
NEWS RELEASE
FOR IMMEDIATE RELEASE Contact: Jack Sholl
714/545-0100 ext. 3013
SPI PHARMACEUTICALS DECLARES 6 PERCENT INCREASE
IN QUARTERLY COMMON STOCK DIVIDEND
COSTA MESA, Calif., January 13, 1994 - In light of the company's first
nine-month financial results and its 1994 outlook, the board of directors of
SPI Pharmaceuticals, Inc. (AMEX:SPI) declared a 6 percent increase in the
company's quarterly common stock to 29 3/4 cents a share.
The dividend, a combination of cash and SPI common stock, will be paid
February 28, 1994 to shareholders of record February 1, 1994.
This action increases SPI's quarterly dividend from 28 cents a quarter
to 29 3/4 cents a quarter. The dividend is equal to $1.19 a share a year
annualized, compared to $1.12 a share in 1992. SPI has increased its dividend
every year since 1984. The dividend consists of 6 1/2 cents in cash and stock
equal to 23 1/4 cents.
For the third quarter of 1993, the company earned $6.9 million on sales
of $70 million. It earned $13.7 on sales of $256.3 million in the first nine
months of 1993.
SPI makes, markets and distributes some 800 prescription and
nonprescription pharmaceuticals in North and Latin America, Western and Eastern
Europe and the Far East. SPI is an opening unit of ICN Pharmaceuticals,
Inc. (NYSE:ICN).
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BUSINESS DAY
THE NEW YORK TIMES - Wednesday, January 12, 1994
FUNDS FIND MANAGERS IN DEALS
INVOLVEMENT WITH PROMOTER IS CITED
By SUSAN ANTILLA
The case of a mutual fund manager who was dismissed last week for his
handling of personal investments is bringing to light other instances of
powerful money managers having participated in private deals with a stock
promoter with whom their funds have done business.
Rafi Khan, a stock promoter who is under investigation by Federal
prosecutors on accusations of perjury and who was fined for securities fraud in
Canada in 1976, did favors for several of his money manager customers by
allowing them personally to buy special private shares in stocks he was
promoting, according to documents filed last summer with the Securities and
Exchange Commission. The practice is not illegal, but it raises questions of
the independence of money managers who accept such favors.
Mr. Khan was affiliated with Reynolds Kendrick Stratton Securities of
Beverly Hills, Calif., until he resigned in early October.
STAR WAS DISMISSED
Last week, the Invesco Funds Group in Denver said it had dismissed one
of its star mutual fund managers, John Kaweske, because he had not followed
company policy regarding personal investments made in his name and in the names
of his wife and children. Mr. Kaweske, who was a client of Mr. Khan and
invested in several of Mr. Khan's selected stocks for Invesco funds, held
75,000 shares of Cardiac Science in his personal portfolio when Cardiac filed
documents with the S.E.C. for a public stock offering in August.
Invesco called the S.E.C. after dismissing Mr. Kaweske on Jan. 5,
prompting an investigation of the money manager's trading. Laura Parsons, a
spokeswoman for Invesco, said yesterday that Invesco compiled all the documents
on Mr. Kaweske's trading and gave them to the S.E.C.'s Denver office on Monday.
Other mutual fund companies have been reviewing their policies
regarding fund managers' personal trading since the news about Mr. Kaweske was
released. And The Washington Post reported yesterday that Fidelity Investments
tightened its rules in November after finding employees had bought stock for
personal accounts and then watched the issues rise after Fidelity funds bought
the shares. Fidelity said yesterday that the rule change was part of a
standard annual review of policy.
Along with Mr. Kaweske, another Invesco manager, Daniel B. Leonard,
owned 100,000 Cardiac shares, the documents show. Mr. Leonard is a portfolio
manager at three Invesco funds: Invesco Financial Strategic Environmental,
Financial Strategic Gold and Strategic Technology.
The Invesco spokeswoman said that Mr. Leonard had bought his shares
with management permission and was not in violation of any Invesco rules.
Philip J. Dubuque, a former fund manager at Invesco who currently runs
the Chestnut Hill Limited Partnership in Boston, was also a Cardiac Science
owner when the company was filing documents related to its attempted stock
offering last summer. Mr. Dubuque owned 150,000 shares, all of which he
intended to sell had the offering taken place, those documents show. On Oct.
14, as publicity about several lawsuits against
PHOTO 1 -- Rafi Khan, a stock promoter, is under Federal investigation.
PHOTO 2 -- John Kaweske, who was dismissed by Invesco Funds Group.
HOLDINGS IN PERSONAL PORTFOLIOS
Shares of Cardiac Science owned by money managers as the company was
prepared to do a public offering last summer. All five managers held private
offering units.
Shares Owned % of
Money Manager Current Firm Before Offering Total
Daniel B. Leonard Invesco 100,000 1.0 %
Philip J. Dubuque Chestnut Hill 150,000 1.4
John Kaweske Invesco 75,000 0.75
Edward C. Huecner Chestnut Hill 200,000 1.9
J. David Mills Chestnut Hill 50,000 0.5
Source: Securities and Exchange Commission filings.
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FUND MANAGERS ARE FOUND
IN STOCK PROMOTER'S DEALS
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Continued From First Business Page
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Mr. Khan was reaching a peak, R.K.S. Securities told Cardiac that it would not
be its underwriter after all. Mr. Khan resigned from R.K.S. earlier that month.
Mr. Dubuque said yesterday that the fund he managed did not contain
Cardiac Science, then hung up after being asked about his own holdings.
Ms. Parsons, the Invesco spokeswoman, said that Mr. Dubuque left
Invesco in March and that he was not in violation of any Invesco rules.
Cardiac Science is not included in any Invesco portfolios, she said.
Although Chestnut Hill filed 13F forms with the S.E.C. in mid-November
noting that it controlled 75,000 shares of Cardiac, J. David Mills, a Chestnut
Hill portfolio manager, insisted that no customers of the firm had ever owned
those shares. But he was not willing to disclose the exact number of Cardiac
shares held by him and his colleagues at present.
Mr. Mills had 50,000 shares last summer, including 25,000 that were
issuable upon exercise of private offering warrants. He acknowledged that Mr.
Khan introduced him to Cardiac, but declined to comment when asked whether he
had other holdings recommended by Mr. Khan.
Chestnut Hill has not had a relationship with Mr. Kahn for four months,
Mr. Mills said. Invesco also severed its relationship with Mr. Khan "a number
of months ago," Jon Zeschin of Invesco said.
Mr. Kaweske was on his way to New York last night for meetings today
with his lawyer, Andrew J. Levander, who said that the Cardiac trades were the
"most serious issue" Invesco raised, and that he found it surprising that the
company made so much of the trades, given that Mr. Leonard and Mr. Dubuque
bought the stock at the same time that Mr. Kaweske did.
Mr. Kaweske was out of town when the other two managers received
written permission to buy Cardiac, Mr. Levander said, and assumed that the
permission would apply to him as well. "My client bought at the same time and
at the same price, and the trades were known to and approved by Invesco," he
said.
Consent of publication has not been received from
The New York Times as of the date of this filing.
<PAGE> 5
New England The Abstracts in the
Journal of New England Advertising
Medicine Journal of Medicine Securities
Seal
Established in 1812 as The NEW ENGLAND JOURNAL OF MEDICINE AND SURGERY
================================================================================
VOLUME 329 DECEMBER 2, 1993 NUMBER 23
================================================================================
HANTAVIRUS-ASSOCIATED ACUTE
RESPIRATORY FAILURE
To the Editor: In May 1993, a new hantavirus-associated acute
respiratory illness was recognized in the southwestern United States.
Laboratory evidence of the infection has been confirmed in 30 patients, of
whom 20 have died. All three Colorado patients died. A confirmed case is
characterized by the abrupt onset of fever, myalgias, and headache, rapidly
followed by unexplained adult respiratory distress syndrome or bilateral
pulmonary interstitial infiltrates with respiratory failure and laboratory
evidence of recent hantavirus infection.(1-5) We describe a confirmed case of
hantavirus infection treated successfully with intravenous ribavirin.
A previously healthy 36-year-old woman was admitted to a rural Colorado
hospital with abrupt onset of fever (temperature, 102 degree F), weakness, and
back pain. The physical examination was unremarkable. A urinalysis performed on
admission led to the working diagnosis of pyelonephritis. The white-cell count
was 4100 per cubic millimeter, with 64 percent segmented forms and 11 percent
band forms. The chest radiograph was normal. The patient was initially treated
with intravenous cefazolin. On day 3, she remained febrile, with vomiting,
hypotension, hypoxemia, and new bilateral, diffuse infiltrates on the chest
radiograph. The white-cell count was 10,000 per cubic millimeter, with 15
percent segmented forms, 43 prcent band forms, and 23 percent lymphocytes. The
hematocrit was 45 percent, and the platelet count was 67,000 per cubic
millimeter. Antibiotic coverage was broadened to include high-dose erythromycin
and cefotaxime. The patient's level of oxygenation decreased, and she required
mechanical ventilation and dopamine for pressor support. Sedation and paralysis
were initiated, since she required a fraction of inspired oxygen of 1.0 and a
positive end-expiratory pressure of 7.5 cm of water. A pulmonary-artery
catheter was placed and revealed a pulmonary-capillary wedge pressureof 14 mm
Hg, a cardiac index of 3.4 liters per minute per square meter of body-surface
area, and a systemic vascular resistance of 1111 dyn - sec - cm-(5). The
white-cell count was 30,000 per cubic millimeter, with 65 percent band forms.
Doxycycline was added to the antibiotic regimen. On day 4, the patient received
a 2-g loading dose of intravenous ribavirin, followed by a dose of 15 mg per
kilogram of body weight every six hours for four days and then by a dose of 7.5
mg per kilogram every eight hours for four days (Centers for Disease Control
and Prevention protocol 4). Thoracentesis was performed on large bilateral
pleural effusions, which were found to be exudative and culture negative. On
day 5, the fraction of inspired oxygen was decreased to 0.55. Total parenteral
nutrition was started for nutritional support. On day 8, the patient was
extubated. Ribavirin therapy was completed on day 14, and the patient was sent
home the next day with no need of ventilatory support. All cultures from the
patient remained negative. An enzyme-linked immunosorbent assay of the
patient's serum performed by the Centers for Disease Control and Prevention was
positive for hantavirus.
This patient is the first known Colorado survivor of a confirmed
respiratory infection due to hantavirus that was treated with intravenous
ribavirin.
Karyn Prochoda, M.D.
Steven R. Mostow, M.D.
Kenneth Greenberg, D.O., Pharm.D.
University of Colorado
Denver, CO 80220 Health Sciences Center
1. Outbreak of acute illness - southwestern United States. 1993. MMWR Morb
Mortal Wkly Rep 1993;42:421-4.
2. Update: hantavirus disease - United States, 1993. MMWR Morb Mortal
Wkly Rep 1993;42:612-4.
3. From the Centers for Disease Control and Prevention: update;
hantavirus infection - United States, 1993. JAMA 1993:270-429, 432.
4. Huggins JW, Hsiang CM, Cosgriff TM, et al. Prospective,
double-blind, concurrent, placebo-controlled clinical trial of intravenous
ribavirin therapy of hemorrhagic fever with renal syndrome. J Infect Dis
1991:164:1119-27.
Consent of publication has not been received from The New England Journal of
Medicine as of the date of this filing.
<PAGE> 6
APPENDIX
Photo 1 -- Rafi Khan
Photo 2 -- John Kaweske
5
