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FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1995
Commission File Number 0-15313
BIO-TECHNOLOGY GENERAL CORP.
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(Exact name of registrant as specified in its charter)
Delaware 13-3033811
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
70 Wood Avenue South, Iselin, New Jersey 08830
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(Address of principal executive offices)
(908) 632-8800
(Registrant's telephone number, including area code)
Former address: Not Applicable
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(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
---- ----
Indicate the number of shares outstanding of each of the issuer's classes of
Common Stock, as of the latest practicable date.
Common Stock, par value $.01 per share,
outstanding as of November 7, 1995 ........................ 43,257,189
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<PAGE>
BIO-TECHNOLOGY GENERAL CORP. AND SUBSIDIARIES
INDEX
Page
----
Part I. Financial Information
Item 1. Financial Statements:
Consolidated Balance Sheets at
September 30, 1995 and December 31, 1994 ................. 3
Consolidated Statements of Operations for the nine months
ended September 30, 1995 and 1994 and for the three
months ended September 30, 1995 and 1994.................. 4
Consolidated Statement of Changes in
Stockholders' Equity for the nine
months ended September 30, 1995 .......................... 5
Consolidated Statements of Cash Flows
for the nine months ended
September 30, 1995 and 1994............................... 6
Notes to Consolidated Financial
Statements ............................................... 7-9
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations............... 10-18
Part II. Other Information
Item 5. Other Information........................................... 19
Item 6. Exhibits and Reports on Form 8-K............................ 19
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BIO-TECHNOLOGY GENERAL CORP. AND SUBSIDIARIES
PART I. FINANCIAL INFORMATION
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
<TABLE>
<CAPTION>
September 30, 1995 December 31, 1994
(Unaudited)
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<S> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents.............................................. $ 11,877 $ 16,891
Receivables:
Trade and other....................................................... 5,258 2,436
Israeli government and other contract research........................ 443 290
Inventories............................................................ 2,348 1,632
Prepaid expenses and other current assets.............................. 528 172
-------- --------
Total current assets................................................. 20,454 21,421
Equipment and leasehold improvements, net............................... 4,127 4,800
Marketing rights, net................................................... 5,053 5,174
Patents, net............................................................ 436 370
Other assets............................................................ 646 575
-------- --------
Total assets......................................................... $ 30,716 $ 32,340
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Short-term bank loans.................................................. $ 10 $ 64
Current portion of long-term debt...................................... 251 1,251
Accounts payable....................................................... 1,083 1,091
Other current liabilities.............................................. 3,670 5,363
-------- --------
Total current liabilities............................................ 5,014 7,769
-------- --------
Long-term liabilities................................................... 452 1,389
-------- --------
Stockholders' equity:
Preferred stock--$.01 par value; 4,000,000
shares authorized; no shares issued................................... -- --
Common stock--$.01 par value; 150,000,000 shares
authorized; issued: 43,242,000 (42,876,000 at
December 31, 1994).................................................... 432 429
Capital in excess of par value......................................... 120,333 120,008
Deficit................................................................ (94,862) (96,307)
Less--treasury stock at cost, 83,000 shares
(67,000 at December 31, 1994)......................................... (340) (303)
--deferred compensation......................................... (313) (570)
--Common Stock subscriptions receivable......................... -- (75)
------- --------
Total stockholders' equity........................................... 25,250 23,182
-------- --------
Total liabilities and stockholders' equity........................... $ 30,716 $ 32,340
======== ========
</TABLE>
The accompanying notes are an integral part of these consolidated balance
sheets.
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<PAGE>
BIO-TECHNOLOGY GENERAL CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands except per share data)
<TABLE>
<CAPTION>
Nine Months Ended Three Months Ended
September 30, September 30,
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1995 1994 1995 1994
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<S> <C> <C> <C> <C>
Revenues:
Product sales...................................... $ 15,761 $ 9,549 $ 4,179 $ 1,075
Research and development revenues
under collaborative agreements.................... 481 3,592 118 216
Contract fees...................................... 486 762 170 87
Other revenues..................................... 701 1,108 374 403
Interest income.................................... 673 324 221 116
------- ------- ------- -------
18,102 15,335 5,062 1,897
------- ------- ------- -------
Expenses:
Research and development........................... 8,462 10,570 2,846 3,388
Cost of product sales ............................. 2,814 1,098 997 375
General and administrative......................... 5,297 7,921 1,825 2,472
Research and development financing................. 856 -- -- --
Commissions and royalties.......................... 477 320 140 73
Interest and finance expenses...................... 114 240 33 68
------- ------- ------- -------
18,020 20,149 5,841 6,376
------- ------- ------- -------
Income (loss) before extraordinary gain............. 82 (4,814) (779) (4,479)
Extraordinary gain resulting from
debt forgiveness.................................. 1,363 1,500 1,363 --
------- ------- ------- -------
Net income (loss) .................................. $ 1,445 $(3,314) $ 584 $(4,479)
======= ======= ======= =======
Earnings (loss) per share:
Loss per common share before
extraordinary gain................................. $ 0.00 $(0.13) $(0.02) $(0.12)
Extraordinary gain per common share................ 0.03 0.04 0.03 --
------- ------- ------ -----
Net income (loss) per common share................. $ 0.03 $(0.09) $ 0.01 $(0.12)
====== ====== ====== ======
Shares used in computation
(Includes common stock equivalents) .............. 43,653 37,555 43,865 37,655
====== ====== ====== ======
</TABLE>
The accompanying notes are an integral part of these consolidated statements.
Certain prior period amounts have been reclassified to conform with current
period presentation.
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<PAGE>
<TABLE>
<CAPTION>
BIO-TECHNOLOGY GENERAL CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
(Unaudited)
(in thousands)
Common Stock
------------- Capital in Common Stock
Par Excess of Treasury Deferred Subscriptions Stockholders'
Shares Value Par Value Deficit Stock Compensation Receivable Equity
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<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balance, December 31, 1994......... 42,876 $429 $120,008 $(96,307) $(303) $(570) $(75) $23,182
Issuance of common stock. ......... 23 64 64
Exercise of stock options.......... 237 2 77 79
Issuance of common stock on
Series A note conversions
(including capitalized
interest)........................ 106 1 184 185
Amortization of deferred
compensation...................... 257 257
Purchase of treasury stock......... (37) (37)
Repayment of common stock
subscriptions..................... 75 75
Net income for nine months
ended September 30, 1995.......... 1,445 1,445
------ ---- -------- --------- ----- ----- ------- -------
Balance, September 30, 1995........ 43,242 $432 $120,333 $(94,862) $(340) $(313) $ -- $25,250
====== ==== ======== ========= ===== ===== ======= =======
</TABLE>
The accompanying notes are an integral part of this consolidated statement.
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<PAGE>
BIO-TECHNOLOGY GENERAL CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
<TABLE>
<CAPTION>
Nine Months
Ended September 30,
-----------------------------
1995 1994
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<S> <C> <C>
Cash flows from operating activities:
Net income (loss)....................................................... $ 1,445 $ (3,314)
Adjustments to reconcile net income to net
cash used in operating activities:
Extraordinary gain resulting from debt forgiveness.................... (1,363) (1,500)
Depreciation and amortization......................................... 2,486 1,929
(Gain) on disposal of fixed assets.................................... (12) (37)
Common stock as payment for services.................................. 64 68
Change in: receivables................................................ (2,975) (1,696)
inventories............................................... (716) (690)
prepaid expenses and other current assets................. (356) (141)
accounts payable.......................................... (8) 256
other assets.............................................. (71) 24
other current liabilities................................. (1,084) 1,370
-------- --------
Net cash used in operating activities.................................. (2,590) (3,731)
-------- --------
Cash flows from investing activities:
Capital expenditures.................................................... (906) (1,338)
Marketing rights........................................................ (529) --
Change in patents....................................................... (92) (58)
Proceeds from sales of fixed assets and investment ..................... 38 67
-------- -------
Net cash used in investing activities................................... (1,489) (1,329)
-------- -------
Cash flows from financing activities:
Long-term debt.......................................................... (1,000) (1,800)
Proceeds from issuance of common stock.................................. 79 840
Repayment of common stock subscriptions................................. 75 102
Interest on Series A and Series B Notes................................. (21) (30)
Purchase of treasury stock.............................................. (37) --
Repayment of Series A Notes............................................. (31) --
-------- -------
Net cash provided by (used in) financing activities...................... (935) (888)
------- -------
Net decrease in cash and cash equivalents................................ (5,014) (5,948)
Cash and cash equivalents at beginning of year........................... 16,891 16,051
------- -------
Cash and cash equivalents at end of period............................... $11,877 $10,103
======= =======
Supplementary Information
Non-cash investing and financing activities:
Series A and Series B note conversions.................................. $ 185 $ 4
Other information:
Interest paid........................................................... $ 27 $ 53
</TABLE>
The accompanying notes are an integral part of these consolidated statements.
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BIO-TECHNOLOGY GENERAL CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1: Statement on Adjustments
In the opinion of management, the condensed consolidated financial statements
include all adjustments, consisting of only normal recurring accruals,
considered necessary for a fair presentation. Due to fluctuations in quarterly
revenues earned, operating results for interim periods are not necessarily
indicative of the results that may be expected for the full year. The accounting
policies continue unchanged from December 31, 1994. For further information,
refer to the Consolidated Financial Statements and footnotes thereto included in
the Company's Annual Report on Form 10-K for the fiscal year ended December 31,
1994.
Note 2: Private Placement Financing
On December 31, 1993, the Company and Bio-Cardia Corporation ("Bio-Cardia")
completed a private placement of 375 units (the "Offering"), each unit ("Unit")
consisting of four shares of common stock of Bio-Cardia and Warrants to purchase
15,000 shares of the Company's common stock. All of the cash proceeds of the
financing are received by Bio-Cardia. In consideration of the Warrants included
in the Units, the Company received from each purchaser of Units an option (the
"Stock Purchase Option"), exercisable at any time on or prior to December 31,
1997, to purchase the Bio-Cardia stock at a purchase price beginning at 125% and
increasing over time to 200% of the cash portion of the price paid for such
stock. Such purchase price may be paid in cash, shares of the Company's common
stock or both, at the Company's discretion. In connection with the closing of
the financing, the Company licensed to Bio-Cardia the right to pursue the
development and commercialization of certain of the Company's products. The
Company and Bio-Cardia have entered into a research and development agreement
pursuant to which the Company will conduct research, development and clinical
testing of these products.
Bio-Cardia and the Company had originally budgeted approximately $32 million of
the net proceeds of the Offering (less if the Stock Purchase Option was
exercised prior to January 1, 1997) to fund development and commercialization of
the products licensed to Bio-Cardia over a period of four years and to reimburse
BTG for previously incurred research and development expenses. However, holders
of 218 Units failed to make the required July 1, 1994 payment of $10,000 per
Unit, which resulted in Bio-Cardia being unable to pay certain amounts due BTG
in respect of research and development conducted by BTG on behalf of Bio-Cardia
and in reimbursement of previously incurred research and development expenses.
In October 1994 Bio-Cardia reached settlements with certain of the defaulting
stockholders, holding an aggregate of 178 Units, who surrendered to Bio-Cardia
their Bio-Cardia stock and Warrants to purchase an aggregate of 2,670,000 shares
of BTG common stock (the "Surrendered Warrants") in exchange for a release from
their future funding obligations to Bio-Cardia. The net effect of this
settlement was to reduce the funding expected by Bio-Cardia by approximately
$14,240,000. In addition, Bio-Cardia commenced legal action against the
remaining defaulting stockholders, holding an aggregate of 40 Units, who owe an
aggregate of $3,200,000. As a result, Bio-Cardia is no longer in a position to
fund the up to $32 million research and development program originally
contemplated by Bio-Cardia and BTG. As a result, BTG has the right to terminate
the Technology License Agreement and repossess all rights to the technology
licensed or sublicensed to Bio-Cardia without the payment of any amounts to
Bio-Cardia other than a royalty on all Improvements
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<PAGE>
BIO-TECHNOLOGY GENERAL CORP. AND SUBSIDIARIES
(as defined in the Technology License Agreement) to the Products developed
pursuant to the development program conducted by BTG on behalf of Bio-Cardia. At
September 30, 1995, Bio-Cardia owed BTG approximately $5,839,000 for research
and development performed by BTG on behalf of Bio-Cardia during 1994 and the
nine months ended September 30, 1995, as well as $1,830,000 in reimbursement of
previously incurred research and development expenses. The Company did not
recognize as revenues the amounts due from Bio-Cardia in respect of research and
development performed by the Company on behalf of Bio-Cardia and in respect of
previously incurred research and development during the three and nine months
ended September 30, 1995. For the nine months ended September 30, 1994, the
Company recognized $2,950,000 of research and development revenues under
collaborative agreements from Bio-Cardia, including $275,000 in respect of
previously incurred research and development.
In May 1995, Bio-Cardia, with the Company's consent, completed an exchange offer
with those Bio-Cardia stockholders who were not in default of their Investor
Notes, who held an aggregate of 157 Units (the "Exchange Offer"). Under the
terms of the Exchange Offer, Bio-Cardia exchanged $4,250 in cash (together with
interest on $2,500 from the date Bio-Cardia received the payment from each
stockholder due July 1, 1994), forgiveness of $17,500 principal amount of the
Investor Note remaining outstanding and rights to receive the Surrendered
Warrants under certain circumstances for each one share of Bio-Cardia common
stock and an unconditional release. The Company returned to Bio-Cardia the cash
of approximately $2,726,000 necessary to make the Exchange Offer, which cash
included $1,920,000 received from Bio-Cardia in 1994 and 1995 (through May 18,
the date the Exchange Offer was consummated) but not recognized as revenues, of
which $1,710,000 was included in other current liabilities on the December 31,
1994 balance sheet. As a result of the Company's return of cash to Bio-Cardia in
connection with the Exchange Offer, BTG recognized a research and development
financing expense of approximately $806,000 in the nine months ended September
30, 1995. In addition, research and development financing expense includes
$50,000, net which BTG provided to Bio-Cardia to allow Bio-Cardia to meet its
current expenses in the nine months ended September 30, 1995. The rights expired
unexercised. In connection with the Exchange Offer the Company amended the
Warrants to provide that if the Company enters into certain transactions which
would result in the sale of the Company for cash at a price per share of the
Company's common stock less than $6.59 (adjusted for stock splits, stock
dividends and similar transactions), then the exercise price of the Warrants
will automatically be reduced to a price per share equal to the difference
between the sale price and $1.10.
The Company has agreed to fund a revised research and development budget for
1995 aggregating approximately $6.2 million to the extent Bio-Cardia does not
have sufficient funds and to advance to Bio-Cardia amounts required by
Bio-Cardia for general and administrative expenses. The Company anticipates that
Bio-Cardia will only receive $900,000 in 1995 from third parties other than BTG
(of which $500,000 was received through September 30, 1995). Through September
30, 1995, the Company has provided approximately $2.8 million of research and
development funding to Bio-Cardia.
One of the defaulting Bio-Cardia stockholders whom Bio-Cardia sued for payment
under the Investor Note has commenced an action which is pending in the United
States District Court for the Southern District of New York against the Company,
Bio-Cardia, David Blech and D. Blech & Co., Incorporated, the placement agent
for the Offering, alleging, among other things, that the Offering violated the
federal securities laws and constituted common law fraud. The plaintiff seeks
rescission of her purchase of Units and restitution of the purchase price paid
by her to date ($640,000), together with interest thereon and expenses. The
Company and Bio-Cardia have made counterclaims against the plaintiff and
cross-claims against David Blech and D. Blech & Co., Incorporated. The Company
believes the plaintiff's claims have no merit, and is defending them vigorously.
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BIO-TECHNOLOGY GENERAL CORP. AND SUBSIDIARIES
Note 3: Extraordinary Gain
In July 1995 the Company paid its former U.S. human growth hormone licensee
$1,000,000 in full satisfaction of its $2,363,000 obligation to this licensee.
Accordingly, the Company recorded an extraordinary gain of $1,363,000 during the
three and nine months ended September 30, 1995.
Note 4: Income Taxes
The Company has not provided any income taxes for the three and nine months
ended September 30, 1995 as any interim tax provision would be offset by
available net operating loss carryforwards.
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<PAGE>
BIO-TECHNOLOGY GENERAL CORP. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Three and nine months ended September 30, 1995
compared with three and nine months ended September 30, 1994
Results of Operations:
The Company has been principally engaged in research and product development
activities since it commenced operation in October 1980 and has incurred
substantial net losses from inception through December 31, 1994.
The Company reported net income of $584,000 and $1,445,000, or $0.01 and $0.03
per share, in the three and nine months ended September 30, 1995, respectively,
compared to a net loss of $4,479,000 and $3,314,000, or $0.12 and $0.09 per
share, in the three and nine months ended September 30, 1994, respectively. Net
income for the three and nine months ended September 30, 1995 and the nine
months ended September 30, 1994 include an extraordinary gain of $1.4 million
and $1.5 million, or $0.03 and $0.04 per share, respectively, resulting from
debt forgiveness. The Company had approximately 6.2 million and 6.1 million
additional shares outstanding for the three and nine months ended September 30,
1995, respectively, as compared to the same periods in 1994.
The Company's revenues are classified in five categories: product sales,
research and development revenues under collaborative agreements, contract fees
(representing licensing and option fees), other revenues (substantially all of
which is funding from the Chief Scientist of the Israeli government) and
interest income. Revenues from each of these categories have fluctuated, and are
expected to continue to fluctuate, from period to period as new licensing and
research and development relationships are established and milestones attained,
scheduled payments under existing arrangements become due and products are
commercialized. Product sales have varied, and are expected to continue to vary,
from quarter to quarter depending on the timing of product orders and product
launches.
Revenues from product sales, derived primarily from the Company's human growth
hormone ("hGH"), pharmaceutical grade hyaluronic acid ("BioLon(R)") and
injectable testosterone ("Delatestryl(R)"), amounted to $4,179,000 and
$15,761,000, or 86% and 90% of revenues (exclusive of interest income), for the
three and nine month periods ended September 30, 1995, respectively. For the
comparable periods in 1994, product sales of $1,075,000 and $9,549,000, or 60%
and 64% of revenues (exclusive of interest income), were earned, respectively.
Sales of hGH were $2,426,000 and $11,467,000, or 58% and 73% of product sales in
the three and nine months ended September 30, 1995, respectively, as compared
with $107,000 and $6,682,000, or 10% and 70% of product sales, respectively, in
the comparable periods in 1994. The increase in sales of hGH was primarily the
result of increased sales to JCR Pharmaceuticals Co., Ltd., the Company's
exclusive distributor in Japan, which accounted for approximately 86%, 77%, 74%
and 79% of hGH product sales in the nine months ended September 30, 1995 and
1994 and the three months ended September 30, 1995 and 1994, respectively. Sales
of BioLon were $848,000 and $2,442,000, or 20% and 15% of product sales, in the
three and nine month periods ended September 30, 1995, respectively, as compared
with $580,000 and $1,332,000, or 54% and 14% of product sales, in the three and
nine month periods ended September 30, 1994, respectively. The increase in sales
of BioLon was due to new product launches during 1995 as well as increased sales
to its distributors who had launched the product prior to January 1, 1995. In
the three and nine month periods ended September 30, 1995, sales of Delatestryl
were $172,000 and $544,000, or 4% of product sales in each period, respectively,
as compared with $191,000 and $575,000, or 18% and 6% of product sales,
respectively, in the comparable periods in 1994. In aggregate, $733,000 and
$1,308,000 were earned from sales of other products for the
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BIO-TECHNOLOGY GENERAL CORP. AND SUBSIDIARIES
three and nine month periods ended September 30, 1995, respectively, as compared
with $117,000 and $679,000, respectively, in the comparable periods in 1994.
For the three and nine month periods ended September 30, 1995, research and
development revenues under collaborative agreements of $118,000 and $481,000, or
2% and 3%, respectively, of revenues (exclusive of interest income), was earned
as compared to $216,000 and $3,592,000, or 12% and 24%, respectively, of
revenues (exclusive of interest income), in the same periods last year. Of the
research and development revenues under collaborative agreements earned in the
nine months ended September 30, 1994, $2,950,000, or 82% of total research and
development revenues under collaborative agreements, was earned in respect of
research and development activities conducted pursuant to the research and
development agreement and service agreement which the Company entered into with
Bio-Cardia Corporation ("Bio-Cardia") in December 1993. For the three and nine
months ended September 30, 1995 the Company has not recognized as revenue the
$661,000 and $2,878,000, respectively, due from Bio-Cardia in respect of
research and development services performed by the Company for Bio-Cardia during
these periods. See "- Liquidity and Capital Resources". All of the research and
development revenues under collaborative agreements earned in the three and nine
month periods ended September 30, 1995, was earned with respect to AIDS research
for the National Institutes of Health ("NIH") as compared with $105,000 and
$403,000, or 49% and 11% of total research and development revenues under
collaborative agreements, in the comparable periods in 1994, respectively. In
aggregate, for other projects, $111,000 and $239,000 were earned in the three
and nine months periods ended September 30, 1994, respectively.
For the three and nine month periods ended September 30, 1995, contract fees of
$170,000 and $486,000, or 4% and 3%, respectively, of revenues (exclusive of
interest income) were earned as compared to $87,000 and $762,000, respectively,
or 5% in each period in the comparable period in 1994. For each of the three and
nine month periods ended September 30, 1995, $140,000, or 82% and 29% of total
contract fees, respectively, was earned in respect of the license of the
marketing rights of BioLon in Europe. In the nine month period ended September
30, 1995, $191,000 and $295,000, or 39% and 61% of total contract fees,
respectively, were earned in respect of the license of the marketing rights of
BioLon in Europe and Latin America and hGH in Latin America and the Far East,
respectively. For each of the three and nine months periods ended September 30,
1994, $87,000, or 100% and 11% of total contract fees, respectively, was earned
in respect of the license of the marketing rights of BioLon in Europe and Latin
America. In the nine month period ended September 30, 1994, $500,000 and
$160,000, or 66% and 21% of total contract fees, respectively, were earned in
respect of the license of the marketing rights of Oxandrin in Australia and hGH
in Canada and Latin America, respectively.
Other revenues, which consist primarily of partial funding of several of the
Company's research and development projects by the Chief Scientist of the
Israeli government, were $374,000 and $701,000, or 8% and 4%, respectively, of
revenues (exclusive of interest income), during the three and nine months ended
September 30, 1995, respectively. For the comparable periods in 1994, other
revenues of $403,000 and $1,108,000, or 23% and 7%, respectively, of revenues
(exclusive of interest income), were earned. For the three and nine months ended
September 30, 1995, Chief Scientist funding represented 99% and 98%,
respectively, of other revenues as compared with 100% and 98%, respectively, in
the same periods in 1994.
Interest income on the Company's investment portfolio amounted to $221,000 and
$673,000 for the three and nine month periods ended September 30, 1995,
respectively, as compared with $116,000 and $324,000 for the same periods last
year. The increase in interest income derived primarily from an increase in cash
balances resulting from $9,000,000 received from financing transactions
consummated in October 1994 as well as higher yield.
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<PAGE>
BIO-TECHNOLOGY GENERAL CORP. AND SUBSIDIARIES
The Company conducts research on potential products for which it has retained
future rights for its own account and on behalf of its partners for which it
receives certain current revenues and, if successful, future revenues in the
form of royalties or manufacturing rights. Expenditures for research and
development in the three and nine month periods ended September 30, 1995 were
$2,846,000 and $8,462,000, respectively, as compared with $3,388,000 and
$10,570,000 in the three and nine month periods ended September 30, 1994,
respectively. The decrease in these expenditures resulted from a change in the
focus of the Company's research and development activities towards the Company's
commercialized products and those which are nearing commercialization and away
from early stage research and development activities, as well as a decrease in
research and development activities conducted on behalf of Bio-Cardia.
Expenditures for research and development in the three and nine months ended
September 30, 1995 include $636,000 and $2,767,000, respectively, on behalf of
Bio-Cardia, which were not reimbursed to the Company. In the same periods in
1994, expenditures for research and development on behalf of Bio-Cardia were
$1,463,000 and $3,930,000, of which only $2,467,000 was reimbursed by Bio-Cardia
through June 30, 1994. See "-Liquidity and Capital Resources."
Cost of product sales, primarily related to commercial sales of hGH, BioLon and
Delatestryl, were $997,000 and $2,814,000 in the three and nine month periods
ended September 30, 1995, respectively, as compared with $375,000 and $1,098,000
for the same periods last year. Cost of product sales as a percentage of product
sales varies from year to year and quarter to quarter depending on the quantity
and mix of products sold. Cost of product sales as a percentage of product sales
is expected to decrease as the quantity sold increases due to economies of
scale. In addition, certain products, such as hGH, have a lower cost of sales
than other products.
General and administrative expenses for the three and nine month periods ended
September 30, 1995 were $1,825,000 and $5,297,000, respectively, as compared
with $2,472,000 and $7,921,000 for the same periods last year. In the three and
nine month periods ended September 30, 1994 the Company spent approximately $0.5
million and $2.2 million, respectively, in respect to the complaint filed by
Genentech Inc. ("Genentech") with the United States International Trade
Commission relating to hGH. During the three and nine months ended September 30,
1995, the Company capitalized as marketing rights approximately $209,000 and
$525,000, respectively, of legal expenses relating to its litigation with
Genentech relating to the launch of hGH in the United States. See "- Liquidity
and Capital Resources."
Research and development financing expenses for the three and nine months ended
September 30, 1995 consist of funds provided to Bio-Cardia for its operations,
of which $806,000 was provided in connection with the Exchange Offer consummated
by Bio-Cardia in May 1995 and $50,000, net was provided to allow Bio-Cardia to
meet its current expenses. See - "Liquidity and Capital Resources."
Commissions and royalties expense for the three and nine months ended September
30, 1995 were approximately $140,000 and $477,000, respectively. In the same
periods in 1994 commissions and royalties expense were $73,000 and $320,000,
respectively. These expenses consist primarily of royalties to the Chief
Scientist and to entities from which the Company licensed certain of its
products.
For the three and nine month periods ended September 30, 1995 the Company
recorded interest and finance expenses of $33,000 and $114,000, respectively. In
the three and nine months ended September 30, 1994, interest and finance
expenses were $68,000 and $240,000, respectively. Interest expense in the three
and nine months ended September 30, 1994 derived mainly from interest accrued on
the Company's balance payable to The Du Pont Merck Pharmaceutical Company ("Du
Pont Merck"), which was paid in July 1995, as described below. Finance expenses
consist primarily of bank charges and fees. See "Liquidity and Capital
Resources."
-12-
<PAGE>
BIO-TECHNOLOGY GENERAL CORP. AND SUBSIDIARIES
In the three and nine months ended September 30, 1995 the Company recognized an
extraordinary gain of $1,363,000 resulting from the Company's payment, in July
1995, of $1,000,000 to Du Pont Merck in full satisfaction of its $2,363,000
obligation to Du Pont Merck. In the nine months ended September 30, 1994 the
Company recognized an extraordinary gain of $1,500,000 resulting from the
Company's payment, in January 1994, of $1,500,000 to SmithKline Beecham ("SB")
in full satisfaction of its $3,000,000 obligation to SB. See "-- Liquidity and
Capital Resources."
The Company expects to incur additional operating losses in the coming quarters
at least until more of its products have received all required regulatory
approvals and are being actively marketed.
Liquidity and Capital Resources
The Company's working capital at September 30, 1995 was $15,440,000 as compared
to $13,652,000 at December 31, 1994.
The Company's cash requirements have been and continue to be satisfied primarily
through (i) product sales, (ii) funding of projects through collaborative
research and development arrangements, (iii) contract fees, (iv) government of
Israel funding of a portion of certain research and development projects, and
(v) equity and debt financings. There can be no assurance that these financing
alternatives will be available in the future to satisfy the Company's cash
requirements.
The major portion of the Company's revenues is derived from product sales and
the Company's collaborative arrangements, under which the Company may earn
up-front contract fees, may receive funding for additional research, is
reimbursed for producing certain experimental materials, may be entitled to
certain milestone payments, may sell product at specified prices and may receive
royalties on sales of product. Revenues have in the past displayed and will in
the immediate future continue to display significant variations due to the
obtaining of new research and development contracts and licensing arrangements,
the completion or termination of such contracts and arrangements, the timing and
amounts of milestone payments and the timing of regulatory approvals of
products.
The Company manages its Israeli operations with the object of protecting against
any material net financial loss in U.S. dollars from the impact of Israeli
inflation and currency devaluation on its non-U.S. dollar assets and
liabilities. The Bank of Israel's monetary policy is to manage the exchange rate
while allowing the Consumer Price Index to rise by approximately 11% in 1993,
14% in 1994, and at a 8% annual rate in the nine month period ended September
30, 1995. For those expenses linked to the Israeli Shekel, such as salaries and
rent, this resulted in corresponding increases in these costs in U.S. dollars.
In 1993 and 1994 the Shekel was devalued by approximately 8% and 1%,
respectively, against the U.S. dollar. Because of the insignificant devaluation
of the Shekel against the U.S. dollar despite the 14% annual rate of increase in
the Consumer Price Index during 1994, BTG's cost of local goods and services, to
the extent linked in whole or in part to the Consumer Price Index, increased in
U.S. dollar terms in 1994. To the extent that expenses in Shekels exceed the
Company's income in Shekels (which to date have consisted primarily of research
and development funding from the Chief Scientist and sales of Bio-Tropin(TM),
the Company's human growth hormone product in Israel, and BioLon in Israel), the
devaluations of Israeli currency have been and will continue to be a benefit to
the Company's financial condition. However, should the Company's income in
Shekels exceed its expenses in Shekels in any material respect, the devaluation
of the Shekel will adversely affect the Company's financial condition. Further,
to the extent the devaluation of the Shekel with respect to the U.S. dollar does
not substantially offset the increase in the costs of local goods and services
in Israel, the Company's financial results will be adversely affected as local
expenses expressed in U.S. dollar terms will increase. There can be no assurance
that the
-13-
<PAGE>
BIO-TECHNOLOGY GENERAL CORP. AND SUBSIDIARIES
government of Israel will continue to devalue the Shekel from time to time to
offset the effects of inflation in Israel.
The Company maintains its funds in money market funds, commercial paper and
other liquid short-term debt instruments. The Company's investment policy is to
preserve principal and to avoid risk.
The cash flows of the Company have fluctuated significantly due to the impact of
net losses, capital spending, and issuance of common stock and other financings.
The Company expects that cash flow in the near future will be primarily
determined by the levels of net income or loss, depreciation and amortization,
and financings, if any, undertaken by the Company. In the nine months ended
September 30, 1995 net cash decreased by $5,014,000 primarily as a result of an
increase in current assets of $4,047,000, a decrease in current liabilities of
$1,092,000 and net investing activities of $1,489,000 partially offset by net
income of $82,000 (before giving effect to an extraordinary gain resulting from
debt forgiveness of $1,363,000 (see "--Results of Operations")) and depreciation
and amortization of $2,486,000. Net investing activities during the nine months
ended September 30, 1995 include capitalization as marketing rights of $529,000
of litigation expenses related to the launch of human growth hormone in the
United States. These amounts were added to the "Marketing Rights" on the balance
sheet and will be amortized over the shorter of the life of the related revenue
stream or seven years, commencing with the initial sale of the Company's hGH in
the United States. In the nine months ended September 30, 1994 net cash
decreased by $5,948,000, primarily resulting from a net loss of $4,814,000
(before giving effect to an extraordinary gain resulting from debt forgiveness
of $1,500,000 (see "--Results of Operations")), payment of long-term debt of
$1,800,000 (consisting of payment to SB and to Du Pont Merck), net investing
activities of $1,329,000, and a net increase in current assets and liabilities
of $877,000 (primarily as a result of an increase in accounts receivable,
inventory and other current liabilities) which were partially offset by
depreciation and amortization of $1,929,000 and proceeds from the issuance of
Common Stock of $840,000.
The Company does not currently have any material commitments for capital
expenditures.
In June 1991, the Company concluded an agreement with Du Pont Merck pursuant to
which it reacquired all the rights relating to the Company's hGH it licensed to
Du Pont Merck, together with all rights to all data generated in
pharmacological, toxicological and clinical studies and encompassed in the
Investigational New Drug Application and New Drug Application files currently
pending with the U.S. Food and Drug Administration for the treatment of human
growth hormone deficient children. The Company agreed to pay Du Pont Merck
royalties on net sales of hGH up to a maximum of $5,000,000, including a minimum
royalty of $2,000,000 (using a 10% 1991 present value). Three hundred thousand
dollars of the minimum royalty was due December 31, 1993 and was paid in
February 1994. The remainder of the minimum royalty was to be paid as follows:
$500,000 to be paid by December 31, 1994 (which was not paid); $500,000 to be
paid by December 31, 1995; $700,000 to be paid by December 31, 1996; and the
remainder to be paid by December 31, 1997. In July 1995 the Company paid Du Pont
Merck $1,000,000 in full satisfaction of its obligation to Du Pont Merck. As a
result, the Company recorded an extraordinary gain of approximately $1,363,000
in the three and nine month periods ended September 30, 1995.
In June 1991 the Committee for Proprietary Medicinal Products ("CPMP") of the
European Economic Community ("EEC") approved SB's application for the use of the
Company's hGH for growth hormone deficient children. In November 1992 the
Company and SB entered into an agreement, effective July 17, 1992, whereby the
Company reacquired all rights to its human growth hormone in Europe and certain
other countries previously licensed to SB. The reacquired rights include the EEC
CPMP approval of the use of the Company's hGH for growth hormone deficient
children, together with all individual EEC member country approvals and pricing
approvals obtained by SB. The license agreement was terminated in connection
with the reacquisition of rights. Simultaneous with the execution of the
agreement with SB,
-14-
<PAGE>
BIO-TECHNOLOGY GENERAL CORP. AND SUBSIDIARIES
the Company entered into an exclusive distribution agreement with the Ferring
Group for the marketing of the Company's human growth hormone for the
enhancement of growth and stature in children. The agreement covers all of
Europe as well as countries comprising the former Soviet Union. Initial country
approvals have been received in Belgium, Denmark, Italy, France, Germany,
Luxembourg, The Netherlands, Spain and the United Kingdom and sales began during
the fourth quarter of 1994 in The Netherlands and Germany. In connection with
the reacquisition of rights from SB, the Company agreed to pay SB an aggregate
of $3,000,000 over a period of up to five years, approximating SB's payments to
the Company under the license agreement. In January 1994 the Company paid SB
$1,500,000 in full satisfaction of its obligation to SB. Accordingly, the
Company recorded an extraordinary gain of $1,500,000 during the first quarter of
1994.
On December 31, 1993, the Company and Bio-Cardia completed a private placement
of 375 units (the "Offering"), each unit ("Unit") consisting of four shares of
common stock of Bio-Cardia and Warrants to purchase 15,000 shares of the
Company's common stock. All of the cash proceeds of the financing are received
by Bio-Cardia. In consideration of the Warrants included in the Units, the
Company received from each purchaser of Units an option (the "Stock Purchase
Option"), exercisable at any time on or prior to December 31, 1997, to purchase
the Bio-Cardia stock at a purchase price beginning at 125% and increasing over
time to 200% of the cash portion of the price paid for such stock. Such purchase
price may be paid in cash, shares of the Company's common stock or both, at the
Company's discretion. In connection with the closing of the financing, the
Company licensed to Bio-Cardia the right to pursue (i) the worldwide development
and commercialization of the Company's Imagex, Bio-Flow, Factorex and BioLase
products for all cardio-vascular indications, the Company's OxSODrol product for
the inhibition of reocclusion of coronary arteries during and after thrombolysis
or angioplasty or in cases of unstable angina, and for the prevention of
restenosis, and the Company's OxSODrol product for the treatment of
bronchopulmonary dysplasia in premature neonates, and (ii) the development and
commercialization of the Company's sodium hyaluronate-based products for
ophthalmic applications in the United States and Japan to protect the corneal
endothelium during intraocular surgery and other pharmaceutical applications
where a shock-absorbing and lubricating material compatible with the human body
is required. The Company and Bio-Cardia have entered into a research and
development agreement pursuant to which the Company is conducting research,
development and clinical testing of these products. Bio-Cardia has determined
not to pursue Bio-Lase for the inhibition of acute reocclusion and treatment of
diabetic thromboembolism, and OxSODrol for the inhibition of reocclusion of
coronary arteries during and after thrombolysis or angioplasty or in cases of
unstable angina, and for the prevention of restenosis, as preliminary studies
were not sufficiently encouraging to justify continued pursuit of these
products. Bio-Cardia ceased pursuing the development of Bio-Flow as of June 30,
1995 as it was unable to find a corporate partner to fund continued research and
development and the Company was unwilling to continue to fund such research and
development absent a corporate partner.
Bio-Cardia and the Company had originally budgeted approximately $32 million of
the net proceeds of the Offering (less if the Stock Purchase Option was
exercised prior to January 1, 1997) to fund development and commercialization of
the products licensed to Bio-Cardia over a period of four years and to reimburse
BTG for previously incurred research and development expenses. However, holders
of 218 Units failed to make the required July 1, 1994 payment of $10,000 per
Unit, which resulted in Bio-Cardia being unable to pay certain amounts due BTG
in respect of research and development conducted by BTG on behalf of Bio-Cardia
and in reimbursement of previously incurred research and development expenses.
In October 1994 Bio-Cardia reached settlements with certain of the defaulting
stockholders, holding an aggregate of 178 Units, who surrendered to Bio-Cardia
their Bio-Cardia stock and Warrants to purchase an aggregate of 2,670,000 shares
of BTG common stock (the "Surrendered Warrants") in exchange for a release from
their future funding obligations to Bio-Cardia. The net effect of this
settlement was to reduce the funding expected by Bio-Cardia by approximately
$14,240,000. In addition, Bio-Cardia commenced legal action against the
remaining defaulting stockholders, holding an aggregate of 40 Units, who owed
-15-
<PAGE>
BIO-TECHNOLOGY GENERAL CORP. AND SUBSIDIARIES
an aggregate of $3,200,000; to date, Bio-Cardia has settled with holders of
eight of these units. As a result, Bio-Cardia is no longer in a position to fund
the up to $32 million research and development program originally contemplated
by Bio-Cardia and BTG. As a result, BTG has the right to terminate the
Technology License Agreement and repossess all rights to the technology licensed
or sublicensed to Bio-Cardia without the payment of any amounts to Bio-Cardia
other than a royalty on all Improvements (as defined in the Technology License
Agreement) to the Products developed pursuant to the development program
conducted by BTG on behalf of Bio-Cardia. At September 30, 1995, Bio-Cardia owed
BTG approximately $5,893,000 for research and development performed by BTG on
behalf of Bio-Cardia during 1994 and the nine months ended September 30, 1995,
as well as $1,830,000 in reimbursement of previously incurred research and
development expenses. The Company did not recognize as revenues the amounts due
from Bio-Cardia in respect of research and development performed by the Company
on behalf of Bio-Cardia and in respect of previously incurred research and
development during the three and nine months ended September 30, 1995. For the
nine months ended September 30, 1994, the Company recognized $2,950,000 of
research and development revenues under collaborative agreements from
Bio-Cardia, including $275,000 in respect of previously incurred research and
development in the six months ended September 30, 1994.
In May 1995, Bio-Cardia, with the Company's consent, completed an exchange offer
with those Bio-Cardia stockholders who were not in default of their Investor
Notes, who held an aggregate of 157 Units (the "Exchange Offer"). Under the
terms of the Exchange Offer, Bio-Cardia exchanged $4,250 in cash (together with
interest on $2,500 from the date Bio-Cardia received the payment from each
stockholder due July 1, 1994), forgiveness of $17,500 principal amount of the
Investor Note remaining outstanding and rights to receive the Surrendered
Warrants under certain circumstances for each one share of Bio-Cardia common
stock and an unconditional release. The Company returned to Bio-Cardia the cash
of approximately $2,726,000 necessary to make the Exchange Offer, which cash
included $1,920,000 received from Bio-Cardia in 1994 and 1995 (through May 18,
the date the Exchange Offer was consummated) but not recognized as revenues, of
which $1,710,000 was included in other current liabilities on the December 31,
1994 balance sheet. As a result of the Company's return of cash to Bio-Cardia in
connection with the Exchange Offer, BTG recognized a research and development
financing expense of approximately $806,000 in the nine months ended September
30, 1995. In addition, research and development financing expense includes
$50,000, net which BTG provided to Bio-Cardia to allow Bio-Cardia to meet its
current expenses in the nine months ended September 30, 1995. The rights expired
unexercised. In connection with the Exchange Offer the Company amended the
Warrants to provide that if the Company enters into certain transactions which
would result in the sale of the Company for cash at a price per share of the
Company's common stock less than $6.59 (adjusted for stock splits, stock
dividends and similar transactions), then the exercise price of the Warrants
will automatically be reduced to a price per share equal to the difference
between the sale price and $1.10.
The Company has agreed to fund a revised research and development budget for
1995 aggregating approximately $6.2 million to the extent Bio-Cardia does not
have sufficient funds and to advance to Bio-Cardia amounts required by
Bio-Cardia for general and administrative expenses. The Company anticipates that
Bio-Cardia will only receive $900,000 in 1995 from third parties other than BTG
(of which $500,000 was received through September 30, 1995). Through September
30, 1995, the Company has provided approximately $2.8 million of research and
development funding to Bio-Cardia.
One of the defaulting Bio-Cardia stockholders whom Bio-Cardia sued for payment
under the Investor Note has commenced an action which is pending in the United
States District Court for the Southern District of New York against the Company,
Bio-Cardia, David Blech and D. Blech & Co., Incorporated, the placement agent
for the Offering, alleging, among other things, that the Offering violated the
federal securities laws and constituted common law fraud. The plaintiff seeks
rescission of her purchase of Units and restitution of the purchase price paid
by her to date ($640,000), together with interest thereon and
-16-
<PAGE>
BIO-TECHNOLOGY GENERAL CORP. AND SUBSIDIARIES
expenses. The Company and Bio-Cardia have made counterclaims against the
plaintiff and cross-claims against David Blech and D. Blech & Co., Incorporated.
The Company believes the plaintiff's claims have no merit, and is defending them
vigorously.
A number of the Company's other products are in the process of gaining approval
from various governmental agencies in the United States and other countries.
While costs associated with this process are generally borne by the Company's
collaborative partners, the approval processes have been considerably longer
than the Company expected, thereby resulting in delays in revenues until such
product approvals have been obtained. As a result, the Company has had to
continue to finance its operations through debt and equity offerings and
collaborative research arrangements that provided research funding. The Company
believes that these delays have negatively impacted the Company's ability to
attract funding and that, as a result, the terms of such financings were less
favorable to the Company than they might otherwise have been had the Company's
product revenues provided sufficient funds to finance the large costs of taking
a product from discovery through commercialization. As a result, the Company has
had to license the commercialization of many of its products to third parties in
exchange for research funding and royalties on product sales; this will result
in lower revenues than if the Company had commercialized the product on its own.
The Company is party to several proceedings relating to patents owned by it or
others. The Company anticipates that the costs of such proceedings will be
significant, and that such expenses could have a material adverse effect on the
Company's results of operations. Should the Company be unsuccessful in any of
these proceedings, it may be unable to commercialize the products which are the
subject of such proceedings in certain countries, and may be unable to produce
the products in Israel, which could have a material adverse effect on the
Company's revenues and results of operations.
On March 16, 1993, Genentech filed a complaint with the U.S. International Trade
Commission (the "ITC") alleging, among other things, that BTG's importation of
hGH into the United States violates Section 337 of the Tariff Act of 1930
because of the existence of certain claims in U.S. patents of Genentech.
Genentech sought an immediate investigation and an order that BTG cease and
desist from importing hGH into the United States. Additionally, Genentech filed
a motion for a temporary exclusion order ("TEO") seeking to exclude the Company
from importing human growth hormone into the United States pending the outcome
of the investigation. On February 25, 1994, the ITC adopted the initial
determination of the administrative judge hearing this matter denying the motion
for a TEO. The trial on the Genentech complaint was held in April 1994. In
January 1995 the ITC issued a final decision dismissing the complaint with
prejudice as a sanction for Genentech's conduct which resulted in an incomplete
record and violated the due process rights of BTG and Novo-Nordisk A/S, another
respondent in the proceeding. The ITC also found no violation by BTG of Section
337 of the Tariff Act of 1930. In March 1995 Genentech filed a notice of appeal
of the ITC decision in the United States Court of Appeals for the Federal
Circuit. During 1993 and 1994, BTG incurred total legal fees of approximately
$4,200,000 relating to the ITC proceeding.
On December 1, 1994, Genentech filed a lawsuit against BTG in the United States
District Court for the District of Delaware alleging that BTG's hGH infringed
two Genentech patents. In January 1995, BTG commenced an action against
Genentech in the United States District Court for the Southern District of New
York seeking, among other things, declaratory judgment as to the
non-infringement, invalidity and unenforceability of such Genentech patents.
Genentech's lawsuit in Delaware has been transferred to New York, and the cases
have been consolidated. Following the Company's receipt of an approval letter
from the United States Food and Drug Administration approving the marketing of
BTG's genetically engineered human growth hormone product, Bio-Tropin(TM), for
the long-term treatment of children with growth failure due to growth hormone
deficiency, Genentech obtained a preliminary injunction prohibiting the
commercial introduction in the United States of the Company's hGH. The Company
has appealed the grant of the preliminary injunction to the United States Court
of Appeals for the Federal Circuit. A hearing is currently
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<PAGE>
BIO-TECHNOLOGY GENERAL CORP. AND SUBSIDIARIES
scheduled for December 1995. Unless the preliminary injunction is stayed or
overturned on appeal, of which there can be no assurance, BTG will be precluded
from marketing and distributing its human growth hormone in the United States
pending the outcome of the patent infringement action. Although BTG believes
that it does not infringe any valid Genentech patent, there can be no assurance
that it will not be found to infringe Genentech's patent. If BTG is ultimately
found by the district court to infringe one or more claims in U.S. patents of
Genentech, it likely will be precluded from selling its hGH in the United
States. The Company expects to incur substantial legal fees in defending and
prosecuting these lawsuits.
The Company believes that its remaining cash resources as of September 30, 1995,
together with anticipated product sales, scheduled payments to be made to BTG
under its current agreements with pharmaceutical partners and third parties, the
anticipated research and development revenues under collaborative agreements,
the proceeds from sales of equity and continued funding from the Chief Scientist
at current levels, will be sufficient to fund the Company's ongoing operations
until the end of 1996. There can, however, be no assurance that product sales
will occur as anticipated, that scheduled payments will be made by third
parties, that current agreements will not be canceled, that committed payments
under collaborative agreements will be received, that the Chief Scientist will
continue to provide funding at current levels, or that unanticipated events
requiring the expenditure of funds will not occur. The satisfaction of the
Company's future cash requirements will depend in large part on the status of
commercialization of the Company's products, the Company's ability to enter into
additional research and development and licensing arrangements, and the
Company's ability to obtain additional equity investments.
The Company expects to seek, from time to time, additional sources of funds, the
form of which will vary depending upon prevailing market and other conditions
and may include short- or long-term borrowings or the issuance of debt or equity
securities. However, there can be no assurance that the Company will be able to
obtain additional funds or, if such funds are available, that such funding will
be on favorable terms. In addition, the indentures under which the Company's
debt securities were issued limit the ability of the Company to satisfy its cash
requirements through borrowings or the issuance of debt securities, and prohibit
the sale of equity securities at a price per share of less than $1.00 (as
adjusted under certain circumstances). The Company continues to seek additional
collaborative research and development and licensing arrangements, in order to
provide revenue from sales of certain products and funding for a portion of the
research and development expenses relating to the products covered, although
there can be no assurance that the Company will be able to obtain such
agreements.
-18-
<PAGE>
BIO-TECHNOLOGY GENERAL CORP. AND SUBSIDIARIES
Part II. OTHER INFORMATION
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
27. Financial Data Schedule.
(b) Reports on Form 8-K:
None
-19-
<PAGE>
BIO-TECHNOLOGY GENERAL CORP. AND SUBSIDIARIES
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
BIO-TECHNOLOGY GENERAL CORP.
(Registrant)
By: /s/ SIM FASS
--------------------------------
Sim Fass
President/CEO,
Principal Executive Officer
/s/ YEHUDA STERNLICHT
--------------------------------
Yehuda Sternlicht
Vice President/CFO
Principal Financial and
Accounting Officer
Dated: November 10, 1995
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEET AND THE CONSOLIDATED STATEMENT OF OPERATIONS AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> SEP-30-1995
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<RECEIVABLES> 5,701
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<INVENTORY> 2,348
<CURRENT-ASSETS> 20,454
<PP&E> 4,127
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<TOTAL-ASSETS> 30,716
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<BONDS> 452
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0
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<OTHER-SE> 24,818
<TOTAL-LIABILITY-AND-EQUITY> 30,716
<SALES> 15,761
<TOTAL-REVENUES> 18,102
<CGS> 2,814
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