<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(MARK ONE)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D)
- ---------
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1995
OR
_________ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (D)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ______ TO _________
COMMISSION FILE NUMBER 0-12900
ALLIANCE PHARMACEUTICAL CORP.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
NEW YORK 14-1644018
- ----------------------------------- ----------
___________________________________
(STATE OR OTHER JURISDICTION (I.R.S. EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
3040 SCIENCE PARK ROAD
SAN DIEGO, CALIFORNIA 92121
- ----------------------------------- --------------------------------
(ADDRESS OF PRINCIPAL ZIP CODE
EXECUTIVE OFFICES)
REGISTRANT'S TELEPHONE NUMBER,
INCLUDING AREA CODE: 619-558-4300
--------------------------------
INDICATE BY A CHECK 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 FILING REQUIREMENTS
FOR THE PAST 90 DAYS.
YES X NO ______________________
---------------------------
AS OF MAY 3, 1995, REGISTRANT HAD 24,602,437 SHARES OF ITS COMMON STOCK, $.01
PAR VALUE, OUTSTANDING.
<PAGE>
ALLIANCE PHARMACEUTICAL CORP. AND SUBSIDIARIES
----------------------------------------------
INDEX
-----
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheets 3
Condensed Consolidated Statements of Operations 4
Condensed Consolidated Statements of Cash Flows 5
Notes to Condensed Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 8
Signature 11
</TABLE>
2
<PAGE>
PART I FINANCIAL INFORMATION:
Item 1. Financial Statements
ALLIANCE PHARMACEUTICAL CORP. AND SUBSIDIARIES
----------------------------------------------
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
March 31, June 30,
1995 1994
-------------------- --------------------
ASSETS (Unaudited) (Note)
------
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 4,579,000 $ 1,902,000
Short-term investments 9,723,000 19,154,000
Research revenue receivable 2,000,000
Inventory and other current assets 1,345,000 1,349,000
-------------------- --------------------
Total current assets 17,647,000 22,405,000
Property, plant and equipment - net 9,798,000 10,165,000
Purchased technology - net 16,162,000 17,033,000
Other assets - net 1,908,000 3,529,000
-------------------- --------------------
$ 45,515,000 $ 53,132,000
==================== ====================
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Current liabilities:
Accounts payable $ 1,711,000 $ 1,074,000
Accrued expenses 1,945,000 1,885,000
-------------------- --------------------
Total current liabilities 3,656,000 2,959,000
Other 681,000 348,000
Stockholders' equity:
Preferred stock - $.01 par value; 5,000,000 shares authorized;
1,500,000 shares outstanding at March 31, 1995 15,000
Common stock - $.01 par value; 30,000,000 shares authorized
at June 30, 1994 and 50,000,000 shares authorized
at March 31, 1995; 21,412,370 and
21,372,054 shares issued and outstanding at
March 31, 1995 and June 30, 1994, respectively 214,000 214,000
Additional paid-in capital 223,045,000 208,954,000
Accumulated deficit (182,096,000) (159,343,000)
-------------------- --------------------
Total stockholders' equity 41,178,000 49,825,000
-------------------- --------------------
$ 45,515,000 $ 53,132,000
==================== ====================
</TABLE>
Note : The balance sheet at June 30, 1994 has been derived from the
audited financial statements at that date but does not include all
of the information and footnotes required by generally accepted
accounting principles for complete financial statements.
See Notes to Condensed Consolidated Financial Statements.
3
<PAGE>
ALLIANCE PHARMACEUTICAL CORP. AND SUBSIDIARIES
- ----------------------------------------------
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
- ---------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Three months ended Nine months ended
March 31, March 31,
1995 1994 1995 1994
-------------------- ----------------- -------------------- -----------------
(Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Revenues:
Product revenue $ 26,000 $ 91,000 $ 135,000 $ 241,000
License and research revenue 2,450,000 28,000 9,550,000 130,000
-------------------- ----------------- ------------------- -----------------
2,476,000 119,000 9,685,000 371,000
Operating expenses:
Research and development 7,797,000 6,879,000 26,778,000 22,434,000
General and administrative 2,515,000 1,851,000 6,467,000 5,236,000
-------------------- ----------------- ------------------- -----------------
10,312,000 8,730,000 33,245,000 27,670,000
-------------------- ----------------- ------------------- -----------------
Loss from operations (7,836,000) (8,611,000) (23,560,000) (27,299,000)
Other income -- net 232,000 449,000 807,000 1,400,000
-------------------- ----------------- ------------------- -----------------
Net loss (7,604,000) (8,162,000) (22,753,000) (25,899,000)
Dividends on preferred stock (188,000) (407,000)
-------------------- ----------------- ------------------- -----------------
Net loss applicable to common shares $ (7,792,000) $ (8,162,000) $ (23,160,000) $ (25,899,000)
==================== ================= =================== =================
Net loss per share $ (0.36) $ (0.38) $ (1.08) $ (1.30)
==================== ================= =================== =================
Weighted average number of shares
outstanding 21,409,000 21,330,000 21,393,000 19,848,000
==================== ================= =================== =================
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
4
<PAGE>
ALLIANCE PHARMACEUTICAL CORP. AND SUBSIDIARIES
- ----------------------------------------------
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
________________________________________________________________________________
<TABLE>
<CAPTION>
Nine months ended
March 31,
1995 1994
------------------ ------------------
(Unaudited)
<S> <C> <C>
OPERATING ACTIVITIES:
Net loss $ (22,753,000) $ (25,899,000)
------------------ ------------------
Adjustments to reconcile net loss to net cash used in
operations:
Depreciation and amortization 2,175,000 2,227,000
Acquired research and development 1,686,000
Changes in assets and liabilities:
Research revenue receivable (2,000,000)
Accounts payable and accrued
expenses and other 395,000 (162,000)
------------------ ------------------
Net adjustments 2,256,000 2,065,000
------------------ ------------------
Net cash used in operating activities (20,497,000) (23,834,000)
------------------ ------------------
FINANCING ACTIVITIES:
Issuance of common stock, preferred
stock, and warrants 14,859,000 15,368,000
------------------ ------------------
Net cash provided by financing activities 14,859,000 15,368,000
------------------ ------------------
INVESTING ACTIVITIES:
Short-term investments 9,083,000 11,558,000
Property, plant, and equipment (768,000) (1,246,000)
------------------ ------------------
Net cash provided by investing activities 8,315,000 10,312,000
------------------ ------------------
INCREASE IN CASH AND CASH EQUIVALENTS 2,677,000 1,846,000
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 1,902,000 5,316,000
------------------ ------------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 4,579,000 $ 7,162,000
================== ==================
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
5
<PAGE>
ALLIANCE PHARMACEUTICAL CORP. AND SUBSIDIARIES
- ----------------------------------------------
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization
- ------------
Alliance Pharmaceutical Corp. ("Alliance") and its subsidiaries
(collectively, the "Company") are engaged in the development, manufacturing, and
early-stage marketing of medical and pharmaceutical products.
Principles of Consolidation
- ---------------------------
The consolidated financial statements include the accounts of Alliance and
its wholly owned subsidiaries, BioPulmonics, Inc. and Rosanin Corporation, and
its majority-owned subsidiaries, Astral, Inc., and Applications et Transferts de
Technologies Avancees. All significant intercompany accounts and transactions
have been eliminated. Certain amounts in fiscal 1994 have been reclassified to
conform to the current year's presentation.
Interim Condensed Financial Statements
- --------------------------------------
The condensed consolidated balance sheet as of March 31, 1995, the
condensed consolidated statements of operations for the three and nine months
ended March 31, 1995 and 1994, and the condensed consolidated statements
of cash flows for the nine months ended March 31, 1995 and 1994 are
unaudited. In the opinion of management, such unaudited financial statements
include all adjustments, consisting only of normal recurring accruals, necessary
for a fair presentation of the results for the periods presented. Interim
results are not necessarily indicative of the results to be expected for the
full year. The financial statements should be read in conjunction with the
Company's consolidated financial statements and footnotes thereto included in
the Company's annual report on Form 10-K for the year ended June 30, 1994.
Cash, Cash Equivalents, and Short-Term Investments
- --------------------------------------------------
Effective July 1, 1994, the Company adopted Statement of Financial
Accounting Standards No. 115 ("FASB No. 115"), Accounting for Certain
Investments in Debt and Equity Securities. Management determines the appropriate
classification of short-term investments at the time of purchase and re-
evaluates such designation as of each balance sheet date. The Company classifies
its short-term investments as available-for-sale. Available-for-sale investments
are stated at fair value, with unrealized gains and losses carried as a
component of stockholders' equity.
Purchased Technology
- --------------------
The purchased technology was acquired by virtue of the merger of Fluoromed
Pharmaceutical, Inc. into a subsidiary of the Company in fiscal 1989. The
technology acquired is the Company's core perfluorochemical ("PFC") technology
and was valued based on an analysis of the present value of future earnings
anticipated from this technology at that time. The Company identified
alternative future uses for the PFC technology, including Oxygent (temporary
blood substitute) and LiquiVent (intrapulmonary oxygen carrier) products.
The PFC technology is the basis for the Company's main drug development
program and is being amortized over a 20-year life. Amortization of purchased
technology is included in research and development expense. Accumulated
amortization was $6,193,000 and $7,065,000 at June 30, 1994 and March 31, 1995,
respectively.
The carrying value of purchased technology is reviewed periodically based
on the projected cash flows to be received from license fees, milestone
payments, royalties and other product revenues. If such cash flows are less than
the carrying value of the purchased technology, the difference will be charged
to expense.
6
<PAGE>
Net Loss Per Share
- ------------------
Net loss per share is based on the weighted average number of shares
outstanding during the respective periods and does not include common stock
equivalents since their effect on the net loss per share would be anti-dilutive.
2. LICENSE AGREEMENT
In August 1994, the Company executed a license agreement with Ortho
Biotech, Inc. and The R.W. Johnson Pharmaceutical Research Institute, a division
of Ortho Pharmaceutical Corporation (collectively referred to as "Ortho"), which
provides Ortho with worldwide marketing and, at its election, manufacturing
rights to the Company's injectable perfluorochemical emulsions capable of
transporting oxygen for therapeutic use. Ortho will pay to Alliance a royalty
based upon its sales of the product after commercialization. In addition, Ortho
paid to Alliance an initial license fee of $4.0 million and will make other
payments based on the achievement of certain milestones. Ortho will also be
responsible for substantially all the remaining costs of developing the
products. As of March 31, 1995, the Company had recorded a receivable of $2.0
million, representing funding due from Ortho for development costs incurred.
Through April 1995, the Company had received research revenue payments of $5.1
million from Ortho. Such amounts are recorded as research revenue in the
consolidated statements of operations. In conjunction with the license
agreement, Johnson & Johnson Development Corp. purchased 1.5 million shares of
Alliance convertible preferred stock for $15.0 million and obtained a warrant to
purchase 300,000 shares of Alliance common stock at $15 per share during the
next three years.
3. SALE OF COMMON STOCK
In April 1995, the Company completed offerings of 3.2 million shares of
newly issued common stock. Net proceeds to the Company from such offerings were
approximately $14.5 million.
7
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
(References to years are to the Company's fiscal years ended June 30.)
Alliance has devoted substantial resources to research and development
related to its pharmaceutical products based upon perfluorochemical ("PFC") and
emulsion technologies. The Company has been unprofitable since inception and
expects to incur operating losses for at least the next several years due to
continued requirements for research and development, preclinical testing and
clinical trials, regulatory activities, commercial manufacturing start-up, and
the establishment of a sales and marketing organization and/or arrangements
therefor. The amount of net losses and the time required by the Company to
achieve profitability are highly uncertain. There can be no assurance that the
Company will be able to achieve profitability at all or on a sustained basis.
LIQUIDITY AND CAPITAL RESOURCES
In April 1995, the company completed offerings of 3.2 million shares of
newly issued common stock. Net proceeds to the company from such offerings were
approximately $14.5 million.
Through March 1995, the Company financed its activities primarily from
public and private sales of equity and funding from marketing and related
agreements with corporate partners. In August 1994, the Company and Ortho
Biotech, Inc. and the R.W. Johnson Pharmaceutical Research Institute, a division
of Ortho Pharmaceutical Corporation (collectively referred to as "Ortho")
entered into a worldwide exclusive license agreement ("License Agreement") for
injectable PFC emulsions capable of transporting oxygen for therapeutic use,
including Oxygent (temporary blood substitute). Pursuant to the License
Agreement, license and research revenues are expected to continue to increase in
1995. Under the License Agreement, Ortho paid to Alliance an initial fee of $4.0
million and will make other payments upon the achievement of certain milestones.
Ortho is responsible for substantially all the remaining costs of developing the
products and will pay Alliance a royalty based upon sales of products after
commercialization. As of March 31, 1995, the Company had recorded a receivable
of $2.0 million, representing funding due from Ortho for development costs
incurred. As of April 1995, the Company had received research revenue payments
of $5.1 million from Ortho. In conjunction with the License Agreement, Johnson &
Johnson Development Corp. ("J&JDC") purchased 1.5 million shares of Alliance
convertible preferred stock for $15.0 million and obtained a warrant to purchase
300,000 shares of Alliance common stock at $15 per share during the next three
years. The Company has financed substantially all of its office and research
facilities and related leasehold improvements under operating lease
arrangements.
The Company had net working capital of $14.0 million at March 31, 1995,
compared to $19.4 million at June 30, 1994. The Company's cash, cash
equivalents, and short-term investments declined to $14.3 million at March 31,
1995, from $21.1 million at June 30, 1994. The decrease resulted primarily from
cash used for operating expenses of $27.7 million and from property, plant, and
equipment additions of $768,000. These uses of cash were offset by $15.0 million
received from the sale of convertible preferred stock to J&JDC, and from receipt
of $4.0 million of license revenue and $3.1 million of research revenue
attributable to the License Agreement. Capital expenditures for 1995 are
expected to be less than those incurred during 1994. The Company's operations to
date have consumed substantial amounts of cash, and are expected to continue to
do so over the foreseeable future.
The Company continually reviews its product development activities in an
effort to allocate its resources to those product candidates that the Company
believes have the greatest commercial potential. Factors considered by the
Company in determining the products to pursue include projected markets and
need, potential for regulatory approval and reimbursement under the existing
health care system, as well as anticipated health care reforms, technical
feasibility, expected and known product attributes, and estimated costs to bring
the product to market. Based on these and other factors, the Company may from
time to time reallocate its resources among its product development activities.
Additions to products under development or changes in products being pursued can
substantially and rapidly change the Company's funding requirements.
In December 1993, the Company entered into an agreement with its primary
supplier of raw material for certain products. Under the terms of the agreement,
the Company is obligated to fund the supplier at defined minimum levels. All
costs associated with the contract are charged to expense as incurred.
The Company expects to incur substantial additional expenditures
associated with product development. The Company may seek additional
collaborative research and development relationships with suitable corporate
partners for its non-licensed products. There can be no assurance that such
relationships, if any, will successfully reduce the Company's funding
requirements. Additional equity or debt financing may be required, and there can
be no assurance that funds from these sources would be available on favorable
terms, if at all. If adequate funds are not available, the Company may be
8
<PAGE>
required to delay, scale back, or eliminate one or more of its product
development programs, or obtain funds through arrangements with collaborative
partners or others that may require the Company to relinquish rights to certain
of its technologies, product candidates, or products that the Company would not
otherwise relinquish.
Alliance anticipates that its current capital resources, including the
$14.5 million in net proceeds from the April 1995 offerings, expected revenues
from the License Agreement, its investments, and product sales, will be adequate
to satisfy its capital requirements and fund current and planned operations for
approximately one year. The Company's future capital requirements will depend on
many factors, including continued scientific progress in its research and
development programs, progress with preclinical testing and clinical trials, the
time and cost involved in obtaining regulatory approvals, patent costs,
competing technological and market developments, changes in existing
collaborative relationships, the ability of the Company to establish development
arrangements, the cost of manufacturing scale-up, and the establishment of an
effective sales and marketing organization and/or arrangements therefor.
While the Company believes that it can produce materials for the initial
market launch of its emulsion products at its existing San Diego facility, it
may need to expand its commercial manufacturing capability for all of its
products in the future. This expansion may occur in stages, each of which would
require regulatory approval, and product demand could at times exceed supply
capacity. The Company has not selected a site or obtained any regulatory
approvals for construction of a commercial production facility for its products.
The projected location and completion date of any production facility will
depend upon regulatory and development activities and other factors. The Company
cannot predict the amount that it will expend for the construction of such a
production facility, and there can be no assurance as to when or whether the
U.S. Food and Drug Administration will determine that such facility conforms
with Good Manufacturing Practices. The License Agreement provides an option to
Ortho to elect to manufacture the emulsion products referred to therein, or to
require the Company to manufacture such products at a negotiated price.
The Company's business is subject to significant risks, including the
uncertainties associated with the lengthy regulatory approval process, obtaining
and enforcing patents important to the Company's business, and possible
competition from other products. Even if the Company's products appear promising
at an early stage of development, they may not reach the market for a number of
reasons. Such reasons include, but are not limited to, the possibilities that
the potential products will be found ineffective during clinical trials, failure
to receive necessary regulatory approvals, difficulties in manufacturing on a
large scale, failure to obtain market acceptance, and the inability to
commercialize because of proprietary rights of third parties. The research,
development, and market introduction of new products will require the
application of considerable technical and financial resources by Alliance, while
revenues generated from such products, assuming they are developed successfully,
may not be realized for several years. Other material and unpredictable factors
which could affect operating results include, without limitation, the
uncertainty of the timing of product approvals and introductions and of sales
growth; the ability to obtain necessary raw materials at cost effective prices
or at all; the effect of possible technology and/or other business acquisitions
or transactions; and the increasing emphasis on controlling health care costs
and potential legislation or regulation of health care pricing.
The Company and certain of its officers and directors are named as
defendants in a lawsuit filed by certain shareholders in September 1992. The
Company believes it has meritorious defenses and intends to defend vigorously
against the claims brought by the shareholders in the action. The Company
believes the eventual outcome of the litigation will not have a material adverse
effect on the Company's financial condition.
9
<PAGE>
RESULTS OF OPERATIONS
NINE MONTHS ENDED MARCH 31, 1995 AS COMPARED WITH NINE MONTHS ENDED
MARCH 31, 1994
The Company's license and research revenue increased to $9.5 million
for the nine months ended March 31, 1995, compared to $130,000 for the nine
months ended March 31, 1994. The increase was due to $4.0 million of license
and $5.1 million of research revenues derived from the License Agreement. The
Company expects license and research revenue to continue at higher levels during
1995, compared to 1994, due to the License Agreement.
The Company incurred total operating expenses of $33.2 million for the
nine months ended March 31, 1995. Operating expenses include $3.9 million for
purchases of raw material for certain products currently being developed, $1.8
million for Oxygent (temporary blood substitute) costs incurred prior to
execution of the License Agreement, $545,000 for products no longer promoted or
developed by Alliance, and a $1.7 million charge for capitalized product rights.
The $3.9 million charge for purchase of raw materials arises under a December
1993 agreement the Company entered into with its primary supplier. Under terms
of the agreement, the Company is obligated to fund the supplier at defined
minimum levels. All costs associated with the contract are charged to research
and development expense as incurred. In January 1994, the Company regained from
Boehringer Ingelheim International GmbH ("BII") all marketing and manufacturing
rights to Imagent(R) (diagnostic imaging agents) and Oxygent products outside of
North America. In conjunction with the acquisition of the marketing and
manufacturing rights from BII, the Company recorded product rights of $1.8
million, based on the value of warrants issued to acquire the rights. The
unamortized portion ($1.7 million) of these product rights was charged to
research and development expense when the Company licensed these product rights
to Ortho.
Research and development expenses increased by 20% to $26.8 million
for the nine months ended March 31, 1995, compared to $22.4 million for the nine
months ended March 31, 1994. The growth in expenses is primarily a result of
increased raw material costs and the product rights charge discussed above and
increased staffing to support growth in research and development efforts. These
expenses were partially offset by a reduction in payments to universities and
outside consultants.
General and administrative expenses increased by 25% to $6.5 million
for the nine months ended March 31, 1995, compared to $5.2 million for the nine
months ended March 31, 1994. The increase in general and administrative
expenses was primarily due to increased professional fees.
Investment and other income was $807,000 for the nine months ended March
31, 1995, compared to $1.4 million for the nine months ended March 31, 1994. The
decline was primarily a result of lower average cash balances.
Alliance expects to incur substantial operating losses over the next
several years due to continuing and increasing expenses associated with its
research and development programs. Operating losses may fluctuate from quarter
to quarter as a result of differences in the timing of revenues earned and
expenses incurred and such fluctuations may be substantial. The Company's
historical results are not necessarily indicative of future results.
THREE MONTHS ENDED MARCH 31, 1995 AS COMPARED WITH THREE MONTHS ENDED
MARCH 31, 1994
The Company's license and research revenue increased by $2.4 million
for the three months ended March 31, 1995 from $28,000 for the three months
ended March 31, 1994. The increase was primarily a result of research revenues
derived from the License Agreement. The Company expects license and research
revenue to continue at higher levels during 1995, compared to 1994, due to the
License Agreement.
Research and development expenses increased by 13% to $7.8 million for
the three months ended March 31, 1995, compared to $6.9 million for the three
months ended March 31, 1994, primarily a result of increased materials
purchases.
General and administrative expenses increased to $2.5 million for the
three months ended March 31, 1995, compared to $1.9 million for the three months
ended March 31, 1994. The increase in general and administrative expenses was
primarily due to increased professional fees.
Investment and other income was $232,000 for the three months ended
March 31, 1995, compared to $449,000 for the three months ended March 31, 1994.
The decline was primarily a result of lower average cash balances.
Alliance expects to incur substantial operating losses over the next
several years due to continuing and increasing expenses associated with its
research and development programs. Operating losses may fluctuate from quarter
to quarter as a result of differences in the timing of revenues earned and
expenses incurred and such fluctuations may be substantial. The Company's
historical results are not necessarily indicative of future results.
10
<PAGE>
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.
ALLIANCE PHARMACEUTICAL CORP.
(Registrant)
/s/ Theodore D. Roth
---------------------------------
Theodore D. Roth
Executive Vice President
and Chief Financial Officer
Date: May 10, 1995
11
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Condensed Consolidated Balance Sheet, and Condensed Consolidated Statement of
Operations and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1995
<PERIOD-START> JUL-01-1994
<PERIOD-END> MAR-31-1995
<CASH> 4,579,000
<SECURITIES> 9,723,000
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 17,647,000
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 45,515,000
<CURRENT-LIABILITIES> 3,656,000
<BONDS> 0
<COMMON> 214,000
0
15,000
<OTHER-SE> 41,178,000
<TOTAL-LIABILITY-AND-EQUITY> 45,515,000
<SALES> 135,000
<TOTAL-REVENUES> 9,685,000
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (23,160,000)
<INCOME-TAX> 0
<INCOME-CONTINUING> (23,160,000)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (23,160,000)
<EPS-PRIMARY> (1.08)
<EPS-DILUTED> (1.08)
</TABLE>
