As filed with the Securities and Exchange Commission on September 30, 1998
Registration No.
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
IMCLONE SYSTEMS INCORPORATED
(Exact name of registrant as specified in its charter)
Delaware 04-2834797
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
180 Varick Street
New York, New York 10014
(Address of Principal Executive Offices) (Zip code)
ImClone Systems Incorporated 1996 Incentive Stock Option Plan, As Amended
ImClone Systems Incorporated 1996 Non-Qualified Stock Option Plan, As Amended
(Full title of the plan)
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John B. Landes
Vice President, Business Development and General Counsel
ImClone Systems Incorporated
180 Varick Street
New York, New York 10014
(Name and address of agent for service)
(212) 645-1405
(Telephone number, including area code, of agent for service)
Copy to:
Lawrence A. Darby III, Esq.
Kaye, Scholer, Fierman, Hays & Handler, LLP
425 Park Avenue
New York, New York 10022-3598
CALCULATION OF REGISTRATION FEE
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Title of Amount Proposed maximum Proposed maximum Amount of
securities to to be offering aggregate registration
be registered registered(1) price per share(2) offering price(2) fee
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Common Stock,
$.001 par
value ....... 1,480 shares $ 9.625 $ 14,246 $ 5
1,161,726 shares 9.699 11,267,581 3,324
336,794 shares 6.130 2,064,548 609
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Totals ... 1,500,000 shares $13,346,375 $3,938
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(1) Excludes such additional indeterminate number of shares as may be issuable
pursuant to the anti-dilution provisions of the Plans (as defined). This
total represents an additional 1,500,000 shares of Common Stock, in the
aggregate, reserved for issuance pursuant to options granted or which may
be granted under either of the ImClone Systems Incorporated 1996
Non-Qualified Stock Option Plan, As Amended, or the ImClone Systems
Incorporated 1996 Incentive Stock Option Plan, As Amended (together, the
"Plans"). With respect to the Plans, 1,500,000 of the shares of Common
Stock reserved for issuance pursuant thereto were previously registered
pursuant to the Registrant's Registration Statement on Form S-8, File No.
333-10275, filed with the Securities and Exchange Commission on August 15,
1996.
(2) Estimated solely for the purposes of calculating the registration fee.
Pursuant to Rule 457(c) and Rule 457(h) under the Securities Act of 1933,
as amended, the proposed maximum offering price per share and the proposed
maximum aggregate offering price of shares subject to outstanding options
have been determined based on the average exercise prices of such
outstanding options and shares not subject to outstanding options have been
determined based on the average of the high and low prices of the Common
Stock on September 29, 1998, as reported by NASDAQ National Market.
<PAGE>
REOFFER PROSPECTUS
IMCLONE SYSTEMS INCORPORATED
2,852,874 SHARES
OF COMMON STOCK
This Reoffer Prospectus (this "Prospectus") relates to the reoffer and
resale of an aggregate of 2,852,874 shares (the "Shares") of the Common Stock,
par value $.001 per share (the "Common Stock"), of ImClone Systems Incorporated
(the "Company" or the "Registrant"). The Shares may be acquired, or have been
acquired, by certain officers and directors of the Company who may be deemed to
be "affiliates" of the Company (as defined in Rule 405 under the Securities Act
of 1933, as amended (the "Securities Act")), all as identified herein (the
"Selling Stockholders"), from time to time upon the exercise of (A) stock
options ("Options") granted as of the date of this Prospectus and/or which may
in the future be granted to such Selling Stockholders pursuant to (i) the
ImClone Systems Incorporated 1996 Incentive Stock Option Plan and/or (ii) the
ImClone Systems Incorporated 1996 Non-Qualified Stock Option Plan and/or (iii)
the ImClone Systems Incorporated 1986 Incentive Stock Option Plan and/or (iv)
the ImClone Systems Incorporated 1986 Non-Qualified Stock Option Plan
(collectively, the "Plans") and (B) certain compensatory warrants (the
"Warrants") to acquire shares of the Common Stock of the Company previously
issued by the Company to certain of its officers and directors. The Company may
from time to time supplement and/or amend this Prospectus to cover additional
shares of Common Stock that underlie Options granted pursuant to one or more of
the Plans to "affiliates" of the Company.
The Selling Stockholders may, from time to time, offer all or part of the
Shares on the NASDAQ National Market or such national securities exchange upon
which the Common Stock may be traded at the time of any such sales, in
negotiated transactions or by a combination of these methods, at fixed prices
that may be changed, at market prices at the time of sale, at prices related to
market prices or at negotiated prices. The Selling Stockholders may effect these
transactions by selling the Shares to or through broker-dealers, who may receive
compensation in the form of discounts or commissions from a Selling Stockholder,
or from the purchasers of the Common Stock for whom the broker-dealers may act
as agent or to whom they may sell as principal, or from both. The Company has
paid or will pay all expenses in connection with the preparation and
reproduction of the Registration Statements of which this Prospectus is a part,
which current expenses are estimated, in the aggregate, to be approximately
$20,000. The Company will not receive any part of the proceeds of any sales by
Selling Stockholders of Shares. However, the Company has received or will
receive the exercise price payable or paid by Selling Stockholders upon the
exercise of Options issued under the Plans and upon the exercise of Warrants.
The Selling Stockholders will pay the brokerage commissions charged to sellers
in connection with any sales of Shares thereby hereunder. In lieu of being sold
pursuant to this Prospectus, any of the Shares which are eligible for sale
pursuant to Rule 144 under the Securities Act ("Rule 144") may be sold by
Selling Stockholders under Rule 144. See "Plan of Distribution."
The Company's Common Stock trades on the NASDAQ National Market under the
ticker symbol "IMCL". On September 29, 1998, the closing sale price of the
Common Stock on the NASDAQ National Market was $9 1/16 per share.
See "RISK FACTORS" beginning on page 7 for a discussion of certain factors
that should be considered in connection with an investment in the Common Stock
offered hereby.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OF ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
No dealer, salesman or any other person has been authorized to give any
information or to make any representations, other than as contained herein, in
connection with the offer made in this Prospectus, and any information or
representations not contained herein must not be relied upon as having been
authorized by the Company or the Selling Stockholders. This Prospectus does not
constitute an offer to sell or a solicitation of an offer to buy any security
other than the Common Stock offered by this Prospectus, nor does it constitute
an offer to sell or a solicitation of an offer to buy any shares of Common Stock
offered hereby to any person in any jurisdiction where it is unlawful to make
such an offer or solicitation to such person. Neither the delivery of this
Prospectus nor any sale hereunder shall under any circumstances create any
implication that information contained herein is correct as of any time
subsequent to the date hereof.
The date of this Prospectus is September 30, 1998.
<PAGE>
SECTION 10(a) PROSPECTUS; REOFFER
PROSPECTUS; POST-EFFECTIVE AMENDMENT TO
PREVIOUSLY FILED REGISTRATION STATEMENTS
Section 10(a) Prospectus. The documents containing the information
specified in Part I of this Registration Statement on Form S-8 will be sent or
given to participants in the Plans as specified by Rule 428(b)(i) under the
Securities Act of 1933, as amended. Such documents are not required to be, and
are not being, filed by the Company with the Securities and Exchange Commission,
either as part of this Registration Statement or as prospectuses or prospectus
supplements pursuant to Rule 424 under the Securities Act of 1933, as amended.
Such documents, together with the documents incorporated by reference herein
pursuant to Item 3 of Part II of this Registration Statement on Form S-8,
constitute a prospectus that meets the requirements of Section 10(a) of the
Securities Act of 1933, as amended.
Reoffer Prospectus. The material which follows up to but not including the
page beginning Part II of this Registration Statement, constitutes a "reoffer
prospectus," prepared in accordance with the requirements of Part I of Form S-3,
in accordance with General Instruction C of Form S-8, to be used in connection
with reoffers and resales of securities acquired under the ImClone Systems
Incorporated 1996 Incentive Stock Option Plan, As Amended, and/or the ImClone
Systems Incorporated 1996 Non-Qualified Stock Option Plan, As Amended and/or the
ImClone Systems Incorporated 1986 Non-Qualified Stock Option Plan and/or the
ImClone Systems 1986 Incentive Stock Option Plan and/or under certain warrants
to acquire shares of Common Stock of the Registrant.
Post-Effective Amendment to Previously Filed Registration Statements.
Pursuant to Rule 429 under the Securities Act of 1933, as amended, the "reoffer
prospectus" included as part of this Registration Statement on Form S-8 also
relates to certain securities registered under ImClone Systems Incorporated's
Registration Statement on Form S-8 (File No. 33-95894) filed with the Securities
and Exchange Commission and declared effective on August 24, 1995 and ImClone
Systems Incorporated's Registration Statement on Form S-8 (File No. 333-10275)
filed with the Securities and Exchange Commission and declared effective on
August 15, 1996 (together, the "Prior Registration Statements"), is intended for
use therewith and constitutes a post-effective amendment to each of the Prior
Registration Statements. Such "reoffer prospectus" is being filed as a
post-effective amendment to each of the Prior Registration Statements in
reliance upon Item 3(a) of General Instruction C of Form S-8 under the
Securities Act of 1933, as amended.
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TABLE OF CONTENTS
Page
AVAILABLE INFORMATION.......................................................1
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE.............................1
CERTAIN FACTORS AFFECTING FORWARD LOOKING STATEMENTS........................2
PROSPECTUS SUMMARY..........................................................2
RISK FACTORS................................................................7
USE OF PROCEEDS............................................................13
SELLING STOCKHOLDERS.......................................................14
PLAN OF DISTRIBUTION.......................................................16
LEGAL MATTERS..............................................................16
DISCLOSURE OF COMMISSION POSITION ON
INDEMNIFICATION FOR SECURITIES ACT LIABILITIES.............................17
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AVAILABLE INFORMATION
The Company has filed three separate Registration Statements on Form S-8
(the "Registration Statements") under the Securities Act with the Commission (as
defined), with respect to the shares of Common Stock of the Company offered
hereby. As permitted by the rules and regulations of the Commission, this
Prospectus omits certain information contained in the Registration Statements
and the exhibits and schedules thereto. For further information with respect to
the Company and the Common Stock offered hereby, the Company is subject to the
informational requirements of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), and in accordance therewith files reports, proxy
statements and other information with the U.S. Securities and Exchange
Commission (the "Commission"). Such reports, proxy statements and other
information filed by the Company with the Commission can be inspected and copied
at the Public Reference Room maintained by the Commission at 450 Fifth Street,
N.W., Room 1024, Washington, D.C., 20549, and at the regional offices of the
Commission at 7 World Trade Center, 13th Floor, New York, New York, 10048 and
Northwestern Atrium Center, 500 West Madison Street, Room 1400, Chicago,
Illinois 60661-2511. Copies of such material can be obtained from the Public
Reference Room of the Commission at 450 Fifth Street, N.W., Washington, D.C., at
prescribed rates. Information regarding the operation of the Public Reference
Room may be obtained by calling the Commission at 1-800-SEC-0330. The Commission
maintains a World Wide Web site that contains reports, proxy and information
statements and other information regarding registrants that file electronically
with the Commission. The address of that site is http://www.sec.gov. The
Company's Common Stock is traded on the NASDAQ National Market under the ticker
symbol "IMCL." Reports, proxy statements and other information may also be
inspected at the NASDAQ National Market offices located at 1735 K Street, N.W.,
Washington, D.C. 20006.
Statements contained in this Prospectus as to the contents of any contract
or other document referred to are not necessarily complete, and in each instance
reference is made to the copy of such contract or other document filed as an
Exhibit to the applicable Registration Statement or otherwise filed with the
Commission, each such statement being qualified in all respects by such
reference, and each such contract or other document shall be deemed to be
incorporated by reference into this Prospectus.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, including all amendments filed for the purpose of
completing or updating such reports, which have been heretofore filed by the
Company with the Commission pursuant to the Exchange Act are hereby incorporated
by reference and made a part hereof:
1. The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1997.
2. The Company's Quarterly Reports on Form 10-Q for the fiscal quarters
ended March 31, 1998 and June 30, 1998.
3. The Company's Current Report on Form 8-K, dated February 10, 1998.
4. The description of the Company's Common Stock, par value $.001 per
share,contained in its registration statement on Form 8-A filed
under the Exchange Act, including any amendment or report filed for
the purpose of updating such description.
All other documents filed by the Company with the Commission pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act subsequent to the date
of this Prospectus and prior to the filing of a post-effective amendment to the
applicable Registration Statement which indicates that all securities offered
have been sold or which de-registers all securities then remaining unsold, shall
be deemed to be incorporated by reference in this Prospectus and to be a part
hereof from the date of filing of such documents (such documents, and the
documents enumerated above, being hereinafter referred to collectively as the
"Incorporated Documents").
Any statement contained in an Incorporated Document shall be deemed to
be modified or superseded for purposes of this Prospectus to the extent that a
statement contained therein or in any other subsequently filed Incorporated
Document modifies or supersedes such statement. Any such statements so modified
or superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
1
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The Company undertakes to provide without charge to each person (including
any beneficial owner) to whom a copy of this Prospectus is delivered, upon oral
or written request of such person, a copy of any and all of the information that
has been or may be incorporated by reference in this Prospectus, other than
exhibits to such documents. Requests for such copies should be directed to the
attention of John B. Landes, Vice President, Business Development and General
Counsel, ImClone Systems Incorporated, 180 Varick Street, 7th Floor, New York,
New York 10014; (212) 645-1405.
CERTAIN FACTORS AFFECTING FORWARD LOOKING STATEMENTS
This Prospectus, including the documents and information incorporated
herein by reference, contains forward-looking statements within the meaning of
Section 27A of the Securities Act that involve risks and uncertainties. In
connection with the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995, the Company is hereby providing cautionary statements
identifying important factors that could cause the Company's actual results to
differ materially from those expressed in forward-looking statements made in
this Prospectus, including the documents and information incorporated herein by
reference. Any statements that express beliefs, plans, objectives, assumptions
or future events or performance (often, but not always, through the use of words
of phrases such as "will likely result," "are expected to," "will continue," "is
anticipated," "estimate," "intends," "plans," "projection," and "outlook") may
be forward-looking and, accordingly, such statements may involve estimates,
assumptions, risks and uncertainties which could cause actual results and
performance of the Company to differ materially from those expressed in the
forward-looking statements. In evaluating the Company and its operations,
performance and results, investors should consider, among other things, and any
forward-looking statements contained in this Prospectus are qualified in their
entirety by reference to, the factors discussed herein under the caption "Risk
Factors" and the estimates, assumptions, risks and uncertainties discussed in
the Company's most recent Annual Report on Form 10-K under the captions
"Business" and "Management's Discussion and Analysis of Financial Condition and
Results of Operations," in the Company's Quarterly Reports on Form 10-Q, and in
the Company's other reports filed under the Exchange Act, in each case
incorporated by reference herein.
The risk factors described herein could cause actual results or outcomes
to differ materially from those expressed in any forward-looking statements of
the Company or made by or on behalf of the Company, and investors, therefore,
should not place undue reliance on any such forward-looking statements. Further,
any forward-looking statement speaks only as of the date on which such statement
is made, and the Company undertakes no obligation to update any forward-looking
statement or statements to reflect events or circumstances after the date on
which such statement is made or to reflect the occurrence of unanticipated
events. New factors emerge from time to time, and it is not possible for
management of the Company to predict all of such factors. Further, management
cannot necessarily assess the impact of each such factor on the Company's
business or the extent to which any factor, or combination of factors, may cause
actual results to differ materially from those contained in any forward-looking
statements.
PROSPECTUS SUMMARY
The following summary is qualified in its entirety by the more detailed
information, "Risk Factors" and financial statements, including the notes
thereto, included or incorporated by reference in this Prospectus. The
securities offered hereby involve a high degree of risk. See "Risk Factors."
General.
The Company is a biopharmaceutical company engaged primarily in research
and development of therapeutic products for the treatment of cancer and
cancer-related disorders. The Company's product candidates include
interventional therapeutics for cancer and cancer vaccines.
Development Programs.
C225 Cancer Therapeutic. The Company's lead interventional therapeutic for
cancer is a chimerized (part mouse, part human) antibody that acts to block the
Epidermal Growth Factor receptor ("EGFr"). EGFr has been shown to be
over-expressed in the cells of approximately one-third of all solid cancers. It
is also expressed in select normal tissue. In vivo animal studies with human
tumors have shown that C225 in combination with various chemotherapeutic agents
(doxorubicin, cisplatin or paclitaxel) demonstrates a pronounced enhancement of
the anti-tumor effect of the chemotherapeutic agents, resulting in the
elimination of human tumors established in these animals. The studies have
demonstrated long-term tumor-free survival
2
<PAGE>
of animals. The Company's research has also shown that C225 used alone has
efficacy in renal cell carcinoma and pancreatic carcinoma animal models.
Since December 1994, the Company has initiated several Phase Ib/IIa
clinical trials of C225 at Memorial Hospital (the patient care arm of Memorial
Sloan-Kettering Cancer Center) ("Sloan-Kettering"), Yale Cancer Center,
University of Virginia, MD Anderson Cancer Center and the University of Alabama,
among others. These studies have involved intravenous administration of
escalating doses of C225, both with and without chemotherapeutic agents, in
patients with various solid cancers. Several of these studies are ongoing. These
studies have shown that the drug is generally well-tolerated. In 1997, the
Company initiated Phase Ib/IIa studies in head and neck cancer patients using
C225 alone (begun in July 1997), in conjunction with cisplatin (begun in April
1997) and in conjunction with radiation (begun in April 1997). Additionally, in
December 1997, the Company initiated a multi-center, open label Phase II
clinical trial to evaluate the effect of C225 on time to progression of disease
in 53 patients with metastatic renal cell carcinoma. The Company expects to
initiate Phase II/III studies to evaluate the potential of C225 in various
additional tumor types, such as head and neck and pancreatic cancers.
BEC2 Cancer Vaccine. BEC2 is a monoclonal anti-idiotypic antibody which
the Company believes may be useful to prevent or delay the onset of recurrent
primary tumors or metastatic disease. The antibody, which mimics the ganglioside
GD3, has been tested since 1991 in Phase I clinical trials at Sloan-Kettering
against certain forms of cancer, including small cell lung carcinoma and
melanoma. There has been evidence of prolonged survival of patients with small
cell lung carcinoma in a pilot study involving BEC2 at Sloan-Kettering. The
Company has granted Merck KGaA, formerly E. Merck ("Merck"), a German-based
pharmaceutical company, exclusive rights to manufacture and market BEC2
worldwide, except that in North America, Merck does not have the right to
manufacture BEC2 and the Company has retained the right to co-promote BEC2. It
is the intent of the parties that the Company will be the bulk product
manufacturer of BEC2 to support worldwide sales. In return, Merck is paying the
Company research support, is required to pay the Company milestone fees and
royalties on future sales, if any, and will share with the Company revenues
associated with the sale of BEC2 by Merck in North America. A Phase III
multinational clinical trial for BEC2 in treatment of limited disease small cell
lung carcinoma has been opened and patient enrollment has been initiated.
Chimerized Monoclonal Antibody Inhibitor of Angiogenesis. The Company has
developed a monoclonal antibody, c-p1C11, which is specific for the KDR receptor
for Vascular Endothelial Growth Factor ("VEGF"). The antibody is currently in
pre-clinical studies in preparation for the filing of an Investigational New
Drug ("IND") Application and the further testing of the product as a potential
cancer therapeutic. The Company is also preparing a humanized form of the
antibody, in conjunction with MRC Collaborative Center. KDR and VEGF are known
to be involved in angiogenesis, which is the natural process of growth of new
blood vessels. A therapeutic product that would inhibit angiogenesis could be of
value in treatment of cancer as well as other diseases that depend on growth of
blood vessels, such as diabetic retinopathy, macular degeneration and rheumatoid
arthritis.
Research Programs.
In addition to concentrating on its products in clinical development, the
Company performs ongoing research in a number of related areas.
Interventional Therapeutics. The Company conducts an interventional cancer
therapeutic research program in the development of inhibitors of tyrosine kinase
receptors (growth factor receptors) associated with tumor cell regeneration and
support.
In addition to its chimerized monoclonal antibody in development, the
Company is seeking to develop other antibodies that inhibit angiogenesis. In
connection with this research and development of the chimerized angiogenesis
inhibitor, the Company is sponsoring research programs at various academic
institutions to test KDR specific therapeutics in animal models.
The Company has also initiated a program to develop small molecule
antagonists of growth factor receptors, including both angiogenic growth factor
receptors and EGF receptors. In October 1997, the Company entered into an
agreement with CombiChem, Inc. ("CombiChem"), a combinational chemistry company,
pursuant to which the Company has access to CombiChem's library of small
molecules for screening in the Company's assays for identification of lead
candidates. The Company also made an equity investment in CombiChem. The Company
has also entered into an agreement with the Institute for Molecular Medicine in
Freiburg, Germany to screen small molecule therapeutic candidates, including
those provided by the compound libraries of CombiChem, against various tyrosine
receptors.
3
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The Company is conducting research on the validation of vascular-specific
cadherin ("VE-cadherin") as a novel potential drug target to inhibit
cancer-associated angiogenesis. VE-cadherin is believed to play an important
role in angiogenesis by enabling the assembly of endothelial cells into vascular
tubes. Cancer growth is dependent on the formation of a capillary blood vessel
network in the tumor, and VE-cadherin antagonists may thus have utility as
anti-cancer agents. The Company will test monoclonal antibodies against
VE-cadherin as potential angiogenesis inhibitors and use its high-throughput
assays for the identification of small molecule VE-cadherin inhibitors. In
connection with this program, the Company has also acquired exclusive rights to
VE-cadherin-2 and to antibodies to VE-cadherin, and has initiated a
collaboration with Mario Negri Institute for Pharmacological Research (Milan,
Italy) to conduct pharmacological research in the role of VE-cadherins in
antiogenesis.
Cancer Vaccines. The Company seeks to discover potential cancer vaccines
as another route to cancer treatment. Cancer vaccines would activate immune
responses to tumors to protect against local spread, distant metasteses or
recurrence of cancer. Choosing appropriate cancer cell targets and generating
effective immune responses are the focus of the Company's cancer vaccine
program. For example, research is being conducted on a possible malignant
melanoma vaccine based on the tumor associated antigen known as gp75. Patients
with malignant melanoma are known to produce antibodies and T cells that
recognize gp75. Animal studies have shown that a gp75 cancer vaccine is highly
effective in eliciting an immune response against melanoma cells and preventing
or inhibiting growth of experimental melanoma tumors in mice.
Endothelial Stem Cell Technology. The Company has proprietary technology
capable of isolating endothelial stem cells and is exploring uses of endothelial
stem cells for stimulation of collateral blood circulation in ischemias (e.g.,
myocardial ischemia and peripheral vascular disease) as well as for gene therapy
delivery. The Company is considering whether to pursue this research directly or
through its recently established wholly-owned subsidiary, EndoClone
Incorporated.
Hematopoiesis. The Company is conducting research in hematopoiesis (growth
and development of blood cell elements) aimed at discovering factors to support
hematopoietic stem cells and to control the proliferation, differentiation and
functional deterioration of hematopoietic elements.
The Company has an exclusive license from The National Institutes of
Health ("NIH") to the delta-like ("DLK") protein and gene for use in stem cell
and gene therapy. DLK is a member of a family of proteins which appear to have
the ability to maintain cells in an undifferentiated state.
The Company also has entered into a non-exclusive license and supply
agreement with Immunex Corporation ("Immunex") for use of the FLK-2/FLT-3 ligand
for ex vivo cell therapies. Immunex has taken a license from the Company to the
FLK-2 receptor, the scope of which is limited to the use by Immunex in the
manufacture of the FLK-2/FLT-3 ligand. Immunex is currently testing the ligand
in human trials for stem cell mobilization and for tumor inhibition.
The Company also has rights to recombinant mutein form of Interleukin-6
("interleukin-6m" or "IL-6m") which it has tested in human trials in cancer
patients to seek to stimulate platelet production. The Company is currently
monitoring third party research with IL-6m to explore the possibility that IL-6m
may be a critical factor in liver cell regeneration.
Licensed Diagnostics and Infectious Disease Vaccines.
The Company has licensed its diagnostic and infectious disease vaccine
product areas, based on its earlier research, to corporate partners for further
development and commercialization. The Company has granted the Wyeth/Lederle
vaccine and pediatrics division of American Home Products Corporation ("American
Home") a worldwide license to manufacture and market its infectious disease
vaccines, which are in development. In January 1998, this agreement was extended
to allow the continuation through September 1999 of pre-clinical research in
preparation for clinical trials of infectious disease candidate vaccines for the
treatment of gonorrhea and the receipt by the Company of annual funding from
American Home during such period in the amount of $300,000. The Company has also
entered into a strategic alliance with Abbott Laboratories ("Abbott") pursuant
to which the Company has licensed certain of its diagnostic products to Abbott
on a worldwide basis. In mid-1995, Abbott launched in Europe its first DNA-based
test, using the Company's proprietary Repair Chain Reaction ("RCR") DNA probe
technology, for the diagnosis of the sexually transmitted disease chlamydia.
Abbott has added tests for gonorrhea and mycobacteria, and has launched sales in
the United States as well. In December 1996, the Company and Abbott modified
this agreement to provide for an exclusive sublicensing agreement with Chiron
Diagnostics ("Chiron") for the Company's patented DNA signal amplification
technology, AMPLIPROBE. Under the terms of the agreement all sales of Chiron
branched DNA diagnostic probe technology in countries covered by Company patents
will be subject to a royalty to Abbott to be passed through to the Company.
4
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Research and Development.
The Company initiated its in-house research and development in 1986. The
Company has assembled a scientific staff with a variety of complementary skills
in a broad base of advanced research technologies, including oncology,
immunology, molecular and cell biology, antibody engineering, protein and
synthetic chemistry and high-throughput screening. The Company has also
recruited a staff of technical and professional employees to carry out
manufacturing of clinical trial materials at its Somerville, New Jersey
manufacturing facility. In addition to its research programs pursued in-house,
the Company collaborates with certain academic institutions and corporations to
support research in areas of the Company's product development efforts. The
Company has also entered into collaborations with major pharmaceutical companies
in order to obtain funding and product development and commercialization
assistance for certain of its therapeutic product candidates in exchange for
specific product licensing rights. The Company intends to enter into additional
agreements of this nature with appropriate pharmaceutical company partners with
the resources and experience to assist the Company financially to successfully
bring its products to market, both in the United States and abroad. There can be
no assurance, however, that the Company will be successful in consummating any
such arrangements.
In addition to its research programs pursued in-house and in collaboration
with corporate partners, the Company collaborates with certain academic
institutions to support research in areas related to the Company's product
development efforts. These institutions include, but are not limited to, the
National Cancer Institute, Sloan-Kettering, the University of California,
Princeton University, the University of North Carolina, The Wistar Institute,
The University of Texas Southwestern Medical Center and The Mario Negri
Institute for Pharmacological Research. Usually, research supported at outside
academic institutions is performed in conjunction with additional in-house
research. The Company also has collaborations with institutions related to the
performance of its clinical trials. Such institutions include, but are not
limited to, Sloan-Kettering, Yale Cancer Center, the University of Virginia, MD
Anderson Cancer Center, and the University of Alabama.
The Company operates a facility in Somerville, New Jersey for the
manufacture of bulk materials of its therapeutic candidates in quality and
quantity sufficient for human clinical trials. At this facility, the Company is
producing C225 bulk drug. At this facility, the Company also supports clinical
development of both the C225 and BEC2 programs.
The Company was incorporated in Delaware in 1984 and commenced its
principal research and development operations in March 1986. The Company's
principal executive offices and laboratories are located at 180 Varick Street,
New York, New York, 10014, and the telephone number is (212) 645-1405.
The Offering.
Common Stock being Offered ............ The Prospectus relates to an
offering by the Selling
Stockholders of up to 2,852,874
shares of Common Stock which may be
acquired, or have been acquired by
such Selling Stockholders upon the
exercise of Options issued as of
the date of this Prospectus or
thereafter under the Plans and upon
the exercise of the Warrants.
Common Stock Outstanding
after the Offering ................. As of September 25, 1998 the
Company had 24,437,522 shares of
Common Stock outstanding. Assuming
that all of the Options and
Warrants held by Selling
Stockholders as of the date of this
Prospectus are exercised and no
other shares of Common Stock are
issued following the date of this
Prospectus, the Company would have
26,833,901 shares of Common Stock
outstanding.
Use of Proceeds ....................... The Company will not receive any
proceeds from the sale of the
Shares offered by the Selling
Stockholders. However, the Company
has received or will receive the
exercise price payable or paid by
Selling Stockholders upon the
exercise of Options issued under
the Plans and upon the exercise of
Warrants. If all of the Options and
Warrants held by the Selling
Stockholders as of the date of this
Prospectus are exercised, the
Company will receive aggregate
estimated proceeds in connection
with the payment of the exercise
prices of such Options and Warrants
(including any amounts
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<PAGE>
received in respect thereof by the
Company in connection with the
exercise of Options and Warrants
prior to the date of this
Prospectus) of approximately
$17,562,000. The Company
anticipates using any proceeds
received, and has used any such
proceeds previously received, upon
the exercise of the Options and
Warrants (i) to continue to fund
and expand its research and
development programs and (ii) for
general corporate purposes,
including working capital. See "Use
of Proceeds."
NASDAQ National
Market Symbol........................ IMCL
Risk Factors........................... See "Risk Factors" for a discussion
of certain risk factors that should
be considered by prospective
investors in connection with an
investment in the Shares offered
hereby.
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<PAGE>
RISK FACTORS
An investment in the Shares offered by this Prospectus involves a high
degree of risk. In addition to the other information contained or incorporated
by reference in this Prospectus, the following factors should be considered
carefully in evaluating an investment in the Shares offered hereby.
Early Stage of Product Development; Technological Uncertainty.
The Company was founded in 1984 and opened its laboratory in New York in
1986. Substantially all of the Company's products are in research or the early
stages of development or clinical studies. Substantially all of the Company's
revenues were generated from license and research arrangements with corporate
sponsors. The Company's revenues under its research and license agreements with
corporate sponsors have fluctuated and are expected to fluctuate significantly
from period to period. Similarly, the Company's results of operations have
fluctuated and are expected to fluctuate significantly from period to period.
These variations have been, and are expected to be, based primarily on the
timing of entering into supported research and license agreements, the status of
development of the Company's various products, the timing and level of revenues
from sales by its partner in diagnostics, Abbott, of products bearing the
Company's technology, the addition or termination of research programs or
funding support, performance by the Company's corporate collaborators of their
funding obligations, the achievement of specified research or commercialization
milestones and variations in the level of expenditures for the Company's
proprietary products during any given period. The Company's products will
require substantial additional development and clinical testing and investment
prior to commercialization. To achieve profitable operations, the Company, alone
or with others, must successfully develop, introduce and market its products. No
assurance can be given that any of the Company's product development efforts
will be successfully completed, that required regulatory approvals can be
obtained or that any products, if developed, will be successfully manufactured
or marketed or achieve customer acceptance.
History of Operating Losses and Accumulated Deficit.
The Company has experienced significant operating losses in each year
since its inception, due primarily to substantial research and development
expenditures. As of June 30, 1998, the Company had an accumulated deficit of
approximately $125 million. The Company expects to incur significant additional
operating losses over each of the next several years.
Cash Requirements; Need for Additional Funding.
The Company has expended and will continue to expend in the future
substantial funds to continue the research and development of its products,
conduct preclinical and clinical trials, establish clinical-scale and
commercial-scale manufacturing in its own facilities or in the facilities of
others, and market its products.
The Company expects to incur substantial funding requirements for the
expansion of operations, including (i) the expansion of the clinical trials of
C225 and the related manufacturing program to support these trials which may
include expansion of the Company's facilities and (ii) in an effort to develop
new product candidates, the expansion of research and development activities
including among other things, increased staffing, the acquisition of equipment,
and the consummation of new outside research agreements. In addition, $2,200,000
of the Industrial Development Revenue Bonds issued by the New York Industrial
Development Agency ("NYIDA") in 1990 with a scheduled maturity in 2004 become
due upon the earlier termination of the lease (the "Lease") for the Company's
New York facility. The Lease is scheduled to expire in March 1999, however, the
Company currently expects to be able to extend the Lease and retrofit the
facility to better suit its needs, although there is no assurance that it will
be able to do so. Assuming the extension of the Lease, the Company expects that
the ongoing research support of its corporate partners, together with its other
capital resources, will be sufficient to enable it to fund its current and
planned operations through the end of the year 2000. The receipt of certain of
such ongoing research support is subject to the attainment by the Company of
specified research and development milestones, certain of which have not yet
been achieved. No assurance can be given that there will not be a change in
projected research support (including research and development milestones), or
in other expenses that would lead to the Company's capital being consumed at a
faster rate than currently expected, or that the Lease will be extended. The
Company will require significant levels of additional capital and intends to
raise the necessary capital through additional arrangements with corporate
partners, equity or debt financings or from other sources. There is no assurance
that the Company will be successful in consummating any such arrangements or
financings. If adequate funds are not available, the Company may be required to
significantly curtail its planned operations.
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The Company has entered into preliminary discussions with several major
pharmaceutical companies concerning the funding of research and development for
certain of its products in research. No assurance can be given that the Company
will be successful in pursuing any such alternatives. In addition, the Company
is in preliminary discussions with several major pharmaceutical companies with
respect to a strategic alliance for the development of its lead product
candidate, C225. Such a strategic alliance could include an up-front equity
investment by such a company in the Company, as well as the payment to the
Company of technology access fees, milestone fees and revenue sharing. There can
be no assurance that the Company will be successful in achieving such an
alliance, nor can the Company predict the amount of funds which might be
available to it if it entered into such an alliance or the time at which such
funds would be made available.
Pursuant to the terms of the Company's Series A Convertible Preferred
Stock (the "Series A Preferred Stock" or "Series A Preferred Shares"), the
holders of the Series A Preferred Shares are entitled to receive, out of funds
legally available therefor, cumulative dividends at the annual rate of $6.00 per
share, compounded annually. Dividends are payable on the then outstanding Series
A Preferred Shares in cash upon the earlier of (i) annually on December 31st of
each year beginning on December 31, 1999; or (ii) at the time of conversion or
redemption of the Series A Preferred Shares on which the dividend is being paid.
Dividends on the Series A Preferred Shares accumulate and accrue from December
15, 1997 (the date of original issuance) and accrue thereafter, whether or not
earned or declared. As of June 30, 1998, dividends aggregating approximately
$1,302,000 had accrued on the Series A Preferred Shares.
Dilution.
Warrants to purchase 2,281,050 shares of the Company's Common Stock (which
includes 1,314,850 warrants held by directors, officers, employees and
consultants of the Company), at an average exercise price of approximately $2.79
per share (subject to adjustment) and stock options to purchase 4,548,424 shares
of the Company's Common Stock (which includes 4,098,424 options granted to
directors, officers, employees and consultants of the Company under the
Company's stock option plans at an average exercise price of approximately $7.90
per share (subject to adjustment), were outstanding as of September 25, 1998.
The shares underlying such options and warrants (including the Options and
Warrants which are covered by this Prospectus) are covered, or will be covered
prior to exercise, by effective registration statements on file with the
Commission. For the life of such options and warrants, the holders thereof are
given an opportunity to benefit from a rise in the market price of the Common
Stock with a resulting dilution of the interest of other stockholders. The
exercise of such options and warrants is likely to be undertaken at a time when
the Company, in all probability, could obtain additional equity capital from the
public on terms more favorable than those provided for pursuant to the options
and warrants. The exercise of a significant number of options and warrants at
any one time or the sale of a substantial number of shares of Common Stock
acquired upon exercise of options or warrants could adversely affect the market
price of the Company's Common Stock and the Company's ability to raise
additional equity capital.
As of September 25, 1998, 400,000 Series A Preferred Shares were
outstanding. The Series A Preferred Shares have a stated value of $100. 100,000
Series A Preferred Shares were immediately convertible into Common Stock on
December 15, 1997 (the "Issuance Date"); an additional 100,000 Series A
Preferred Shares become convertible on or after January 1, 2000 (the "Second
Anniversary Date"); an additional 100,000 Series A Preferred Shares become
convertible on or after January 1, 2001 (the "Third Anniversary Date"); and an
additional 100,000 Series A Preferred Shares become convertible on or after
January 1, 2002 (the "Fourth Anniversary Date"). Series A Preferred Shares
converted on or after the Issuance Date and before the Second Anniversary are
convertible at a per share conversion price of $12.50; Series A Preferred Shares
converted on or after the Second Anniversary Date and before the Third
Anniversary Date are convertible at a per share conversion price equal to the
Average Market Price of the Common Stock for the five (5) consecutive trading
days ending one trading day prior to the Second Anniversary Date; Series A
Preferred Shares converted on or after the Third Anniversary Date and before the
Fourth Anniversary Date are convertible at a per share conversion price equal to
the Average Market Price of the Common Stock for the five (5) consecutive
trading days ending one trading day prior to the Third Anniversary Date; Series
A Preferred Shares converted on or after the Fourth Anniversary Date and before
January 1, 2003 are convertible at a per share conversion price equal to 88% of
the Average Market Price of the Common Stock for the five (5) consecutive
trading days ending one trading day prior to the Fourth Anniversary Date; and
Series A Preferred Shares converted on or after January 1, 2003 are convertible
at a per share conversion price equal to the Average Market Price of the Common
Stock for the five (5) consecutive trading days ending one trading day prior to
the receipt by the Company of a notice of conversion. For purposes of computing
the conversion price, "Average Market Price" of the Common Stock for any period
is the average of the closing prices for the Common Stock for each trading day
in such period as reported by the NASDAQ National Market or any trading system
on which the Common Stock may then be quoted. The conversion price is subject to
adjustment in the case of certain
8
<PAGE>
dilutive events. Further, in the event the Average Market Price of the Common
Stock for the five (5) consecutive trading days ending one trading day prior to
any trading day during which any Series A Preferred Shares are outstanding
exceeds 150% of the conversion price then in effect, the Company has the right
to require the holder of the Series A Preferred Shares to convert all such
shares as may then be convertible. In connection with the issuance of the Series
A Preferred Shares, Merck was granted certain registration rights with respect
to the underlying shares of Common Stock. Due to the fact that, commencing on
the Second Anniversary Date, the number of shares of Common Stock into which
Series A Preferred Shares are convertible is not fixed, and is determined with
reference to the market prices of the Company's Common Stock as described above,
as the market price of the Common Stock decreases, the number of shares issuable
upon conversion of the Series A Preferred Shares will increase.
Limited Manufacturing Experience.
To be successful, the Company's products must be manufactured in
commercial quantities in compliance with regulatory requirements and at
acceptable costs. Although the Company has developed products in the laboratory
and in some cases has produced sufficient quantities of materials for
pre-clinical animal trials and early stage clinical trials, production in late
stage clinical or commercial quantities may create technical challenges for the
Company. The Company owns a facility which is used as its clinical-scale
manufacturing facility. If it commercializes its products, the Company may adapt
this facility or outfit an additional facility for use as its commercial-scale
manufacturing facility. However, the Company has limited experience in
clinical-scale manufacturing and no experience in commercial-scale
manufacturing, and no assurance can be given that the Company will be able to
make the transition to late stage clinical or commercial production. The timing
and any additional costs of adapting the Company's facility or outfitting an
additional facility for commercial manufacturing will depend on several factors,
including the progress of products through clinical trials, and such timing and
additional costs are not yet determinable.
Establishing Sales and Marketing Capability.
As a research and development company, the Company does not have
significant experience in selling or marketing new products. The Company's
current strategy does not necessarily include marketing products on its own, as
it may do so initially through, or in conjunction with, its corporate partners.
See "Risk Factors-Dependence on Certain Contractual Agreements with Corporate
Partners. " At such time as the Company seeks to market directly a new product,
the Company will require expertise in sales and marketing. There can be no
assurance that the Company will be able to retain qualified or experienced sales
and marketing personnel or that any efforts undertaken by such personnel will be
successful. Under the Company's agreement with Merck, the Company has the right
to co-market BEC2 in North America in the event BEC2 is approved for sale in
North America.
Dependence on Certain Contractual Agreements with Corporate Partners.
To date, the Company has derived substantially all, and the Company
expects to continue to derive over the next several years a substantial portion,
of its revenues related to research and development funding and license fee
revenues from agreements with corporate partners. These agreements typically
provide the corporate partner with certain rights to manufacture and/or market
in certain geographic areas specified products which are developed using the
Company's proprietary technology, subject to an obligation to pay royalties to
the Company based on future product sales, if any. Certain of these agreements
provide for funding by corporate partners of research activities performed by
the Company, and in some cases for payments to the Company of license fees,
either upon entering into such agreements or upon achievement of specified
research, regulatory and commercialization milestones, or both. The Company's
revenues from these agreements are not received at regular intervals, have
fluctuated in the past, and are expected to continue to fluctuate in the future.
In general, the agreements from which the Company derives such revenues are
subject to early termination at the election of the corporate partner. In the
past, some of these arrangements have been terminated. There is no assurance
that revenues from these sources will be maintained, or that the Company will
enter into any additional agreements of a similar nature.
Under most of these agreements, the corporate partner, at least for
certain territories, controls and is responsible for the design and conduct of
pre-clinical and clinical trials, seeking and obtaining of regulatory approvals,
establishing clinical and commercial-scale manufacturing capabilities and
manufacturing and marketing of products in those territories. Pursuant to such
agreements, the amount and timing of funding and the investment of other
resources are controlled by such other parties
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and also are subject to the risk of financial or other difficulties that may
befall such other parties. In addition, the Company's corporate partners or
their affiliates may be pursuing alternative products or technologies addressing
the same purposes as those which are the subject of their collaboration with the
Company. While the Company believes its corporate partners have or will have an
economic motivation to succeed in performing their obligations under such
agreements, there can be no assurance that the corporate interests and
motivations of these partners will remain consistent with those of the Company.
Uncertainties as to Patents and Proprietary Technologies.
The patent position of biopharmaceutical companies generally is highly
uncertain and involves complex legal and factual questions. The Company's
success will depend, in part, on its ability to obtain patents on its own
products, obtain licenses to use third parties' technologies, protect trade
secrets, and operate without infringing the proprietary rights of others. If the
Company is unable to obtain patents that adequately protect its own products, or
if any of the Company's proprietary technologies were to conflict with the
rights of others, the Company's ability to commercialize products using such
technologies could be materially and adversely affected.
The Company currently is the exclusive licensee or assignee of 42 issued
patents worldwide, 24 of which are issued United States patents. The Company is
the assignee or exclusive licensee of approximately 36 families of patent
applications in the United States and in foreign countries directed to its
proprietary technology. There can be no assurance that patents will issue as a
result of any of such applications. Nor can there be any assurance that issued
patents would be of substantial protection or commercial benefit to the Company
or would afford the Company adequate protection from competing products. For
example, issued patents may be challenged and declared invalid. In addition,
under many of its license agreements with third parties, the Company is required
to meet specified milestone or diligence requirements in order to retain its
license to such third party patents and patent applications. There can be no
assurance that the Company will satisfy any of these requirements.
The Company holds rights under certain third party patents that it
considers necessary for the development of its technology. It is anticipated
that, in order to commercialize certain of the products that the Company is
developing or may develop, the Company may be required to obtain additional
licenses to patents from third parties. However, the extent to which such
licenses may be required, the availability of such licenses and the cost of such
licenses, if they are available, are uncertain, at present.
The Company is aware that other parties have filed patent applications in
various countries in several areas in which the Company is developing products.
Some of these patent applications have issued as patents and some are still
pending. There can be no assurance that the pending patent applications will not
issue as patents. Issued patents are entitled to a rebuttable presumption of
validity under the laws of the United States and certain other countries. These
issued patents may adversely affect the ability of the Company to develop
commercial products it is attempting to develop. If licenses to such patents are
needed, there can be no assurance that any such licenses would be obtainable by
the Company on acceptable terms.
The following are some of the areas in which the Company may be adversely
affected by the patents and patent applications of others:
The Company has an exclusive license to an issued U.S. patent for the
murine form of C225, the Company's EGFr antibody product. The Company's licensor
did not seek patent protection outside the United States with respect to this
antibody. Outside the United States, the Company is relying, in part, on patent
applications exclusively licensed from a major pharmaceutical company which
claim the use of an EGFr antibody in conjunction with chemotherapeutic agents.
The Company is currently prosecuting these applications. There can be no
assurance that the Company will be successful in these efforts.
The EGFr antibody being developed by the Company is a "chimerized"
monoclonal antibody. Patents have been issued to other biotechnology companies
that cover the chimerization of antibodies, and the Company may be required to
obtain licenses under these patents in order to commercialize its chimerized
monoclonal antibodies. There can be no assurance that the Company will be able
to obtain such licenses in the territories where it proposes commercialization.
The Company is aware that third-party patents have been issued in the
United States and Europe covering anti-idiotypic antibodies and/or their use for
the treatment of tumors. Such patents, if valid, could be construed to cover the
Company's BEC2 monoclonal antibody and certain uses thereof in the United States
and most of Europe. Merck, the Company's licensee of BEC2 worldwide (except that
the Company has retained the right to co-promote BEC2 in the United States), has
informed the Company that it has obtained a non-exclusive, worldwide license to
such patent in order to market
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<PAGE>
BEC2 in its territory. No assurance can be given that such license would be
available to the Company in other parts of the world on commercially acceptable
terms, if at all.
The Company maintains a proprietary position with respect to
anti-angiogenic therapeutics, as well as therapeutic methods of treating
angiogenic disease, through patents and patent applications filed by the
Company. The Company is aware that third parties have filed patent applications
that could affect the ability of the Company to commercialize some of its
anti-angiogenic therapeutics or therapeutic treatments.
The United Sates Patent and Trademark Office has granted two patents for
the Company's cysteine-depleted IL-6 molecular variant, IL-6m, and the DNA that
encodes IL-6m. The patent and patent applications are co-owned by the Company
and the University of North Carolina, whose rights have been exclusively
licensed to the Company. The Company is aware of patents issued to a third party
in the United States and Europe covering cysteine-depleted proteins. In
addition, the Company is aware of third-party patents for both recombinant and
native IL-6 and methods for its production. The Company is aware of a European
patent for the DNA encoding for human recombinant IL-6 and methods for its
production which has been exclusively licensed on a worldwide basis to a
pharmaceutical company. The Company has entered into a settlement agreement with
such pharmaceutical company whereby the pharmaceutical company has agreed not to
enforce its patent against the Company based on the Company's use of its IL-6m
patent or patent applications.
The Company is aware that third parties have filed patent applications in
areas that could affect the ability of the Company or its licensee for
diagnostics, Abbott, to commercialize the Company's diagnostic products. These
areas could include target amplification technology and signal amplification
technology. Third party patents have already issued in the field of target
amplification such as polymerase chain reaction technology (also known as PCR).
There has been significant litigation in the biopharmaceutical industry
regarding patents and other proprietary rights. Such litigation has consumed
substantial resources for the parties involved. If the Company became involved
in similar litigation regarding its intellectual property rights, the cost of
such litigation could be substantial and could have a material adverse effect on
the Company.
Certain proprietary trade secrets and unpatented know-how are important to
the Company in conducting its research and development activities. There can be
no assurance that others may not independently develop the same or similar
technologies. Although the Company has taken steps, including entering into
confidentiality agreements with its employees and third parties, to protect its
trade secrets and unpatented know-how, third parties nonetheless may gain access
to such information.
Reliance on and Attraction and Retention of Key Personnel and Consultants.
The Company's ability to successfully develop marketable products and to
maintain a competitive position will depend in large part on its ability to
attract and retain highly qualified scientific and management personnel and to
develop and maintain relationships with leading research institutions and
consultants. The Company is highly dependent upon the principal members of its
management, scientific staff and Scientific Advisory Board. Competition for such
personnel and relationships is intense, and there can be no assurance that the
Company will be able to continue to attract and retain such personnel.
Technological Change and Risk of Obsolescence; Competition.
The biopharmaceutical industry is subject to rapid and significant
technological change. The Company has numerous competitors, including major
pharmaceutical and chemical companies, specialized biotechnology firms,
universities and other research institutions. These competitors may succeed in
developing technologies and products that are more effective than any which are
being developed by the Company or which would render the Company's technology
and products obsolete and non-competitive. Many of these competitors have
substantially greater financial and technical resources and production and
marketing capabilities than the Company. In addition, many of the Company's
competitors have significantly greater experience than the Company in
pre-clinical testing and human clinical trials of new or improved pharmaceutical
products and in obtaining Food and Drug Administration ("FDA") and other
regulatory approvals on products for use in health care. The Company is aware of
various products under development or manufactured by competitors that are used
for the prevention, diagnosis or treatment of certain diseases the Company has
targeted for product development, some of which use therapeutic approaches that
compete directly with certain of the Company's product candidates. The Company
has limited experience in
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conducting and managing the pre-clinical testing necessary to enter the clinical
trials that are required to obtain government approvals, and has limited
experience in conducting clinical trials. Accordingly, the Company's competitors
may succeed in obtaining FDA approval for products more rapidly than the
Company, which could adversely affect the Company's ability to further develop
and market its products. If the Company commences significant commercial sales
of its products, it will also be competing with respect to manufacturing
efficiency and marketing capabilities, areas in which the Company has limited or
no experience.
Extensive Government Regulation.
Research, pre-clinical development, clinical trials and the manufacturing
and marketing of therapeutic and diagnostic products under development by the
Company are subject to extensive and rigorous regulation by governmental
authorities in the United States and other countries. Clinical trials and the
manufacturing and marketing of products will be subject to the testing and
approval processes of the FDA and comparable foreign regulatory authorities. The
process of obtaining such required regulatory approvals for the types of
products under development by the Company usually takes many years and is
expensive. Development of a new biologic therapeutic or vaccine product may
take, from initiation of clinical trials until FDA approval, an average of five
to ten years (or more), while in vitro diagnostics may take approximately two to
six years, or more, depending on the requirements of the approval process or
clinical data requirements. If the FDA requests additional data, these time
periods can be substantially increased. Even after such additional data are
submitted, there can be no assurance of obtaining FDA approval. In addition,
product approvals may be withdrawn or limited for noncompliance with regulatory
standards or the occurrence of unforeseen problems following initial marketing.
The Company has not sought or received regulatory approval for the commercial
sale of any of its products or for any manufacturing processes or facilities.
The Company and its licensees may encounter significant delays or excessive
costs in their respective efforts to secure necessary approvals or licenses.
Future federal, state, local or foreign legislative or administrative acts could
also prevent or delay regulatory approval of the Company's or its licensees'
products. There can be no assurance that the Company or its collaborative
partners will be able to obtain the necessary approvals for clinical testing,
manufacturing or marketing of the Company's products, or that the clinical data
they obtain in clinical studies will be sufficient to establish the safety and
effectiveness of the products. Failure to obtain or maintain requisite
governmental approvals or failure to obtain approvals of the clinical intended
uses requested, could delay or preclude the Company or its licensees from
further developing particular products or from marketing their products or could
limit the commercial use of the products and thereby have a material adverse
effect on the Company's liquidity and financial condition.
Product Liability Exposure.
The use of the Company's product candidates during testing or after
approval entails an inherent risk of adverse effects which could expose the
Company to product liability claims. There can be no assurance that the Company
would have sufficient resources to satisfy any liability resulting from any such
claims. The Company endeavors to obtain indemnification by its corporate
partners against certain of such claims. However, there can be no assurance that
such parties will honor, or have the financial resources to honor, any such
obligations. The Company currently has product liability insurance which covers
products in pre-clinical and clinical testing. There can be no assurance that
such coverage will be adequate in scope to protect the Company in the event of a
successful product liability claim.
Hazardous Materials; Environmental Matters.
The Company's research and development activities involve the controlled
use of hazardous materials, chemicals, viruses and various radioactive
compounds. The Company is subject to federal, state and local laws and
regulations governing the use, manufacture, storage, handling and disposal of
such materials and certain waste products. Although the Company believes that
its safety procedures for handling and disposing of such materials comply with
the standards prescribed by such laws and regulations, the risk of accidental
contamination or injury from these materials cannot be completely eliminated. In
the event of such an accident, the Company could be held liable for any damages
that result, and any such liability could exceed the resources of the Company.
The Company may be required to incur significant costs to comply with
environmental laws and regulations in the future. The Company's operations,
business or assets may be materially or adversely affected by current or future
environmental laws or regulations.
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Uncertainty of Health Care Reimbursement and Related Matters.
The Company's ability to earn sufficient returns on its products may
depend in part on the extent to which reimbursement for the costs of such
products and related treatments will be available to purchasers or users thereof
from government health administration authorities, private health coverage
insurers and other organizations. If purchasers or users of the Company's
products are not entitled to adequate reimbursement for the cost of using such
products, they may forego or reduce such use. Significant uncertainty exists as
to the reimbursement status of newly approved health care products, and there
can be no assurance that adequate third-party coverage will be available.
Possible Volatility of Stock Price.
The Company believes that factors such as the status of its products in
development, announcements of new products, formation or termination of
corporate alliances, other developments by the Company, its competitors or the
FDA, determinations in connection with patent applications of the Company or
others and variations in quarterly operating results, among others, could cause
the market price for the Common Stock to fluctuate substantially. In addition,
the stock market has experienced extreme price and volume fluctuations that have
particularly affected the market price for many high technology and
healthcare-related companies and that have often been unrelated to the operating
performance of these companies. These broad market fluctuations may adversely
affect the market price of the Common Stock.
Limitations on Net Operating Loss Carryforwards.
At December 31, 1997, the Company had net operating loss carryforwards for
federal income tax purposes of approximately $115,000,000 which expire at
various dates from 2000 through 2012. At December 31, 1997 the Company had
research credit carryforwards of approximately $2,303,000 which expire at
various dates from 2001 through 2012. Pursuant to Section 382 of the Internal
Revenue Code of 1986, as amended, the annual utilization of a company's net
operating loss and research credit carryforwards may be limited if such company
experiences a change in ownership of more than 50 percentage points within a
three-year period. Since 1986, the Company has experienced two such ownership
changes. Accordingly, the Company's net operating loss carryforwards available
to offset future federal taxable income arising before such ownership changes
are limited to $5,159,000 annually. Similarly, the Company is restricted in
using its research credit carryforwards arising before such ownership changes to
offset future federal income tax expense.
Dividend Policy and Restrictions.
The Company has never paid any cash dividends on its Common Stock. The
Board of Directors of the Company will determine future dividend policy based on
the Company's results of operations, financial condition, capital requirements
and other circumstances. The Company does not anticipate that any dividends will
be declared on its Common Stock in the foreseeable future. Except as may be
utilized to pay the dividends payable on the Company's Series A Preferred Stock,
any earnings which the Company may realize will be retained to finance the
growth of the Company. In addition, the terms of the Series A Preferred Stock
restrict the payment of dividends on other classes and series of stock. See
"Prospectus Summary-The Company-BEC2 Cancer Vaccine" and "Risk
Factors-Dilution."
USE OF PROCEEDS
The Company will not receive any proceeds from the sale of the Shares
offered herein by the Selling Stockholders, however, the Company has received or
will receive the exercise price for Options and Warrants upon the prior or
future exercise by such Selling Stockholders of such Options and Warrants. If
all of the Options and Warrants held by Selling Stockholders as of the date of
this Prospectus and covered by this Prospectus are exercised, the Company will
receive aggregate estimated proceeds (including any amounts received by the
Company in connection with the previous exercise by Selling Stockholders of
Options and Warrants prior to the date of this Prospectus) of approximately
$17,562,000. The Company anticipates utilizing any such proceeds received, and
has utilized any such proceeds previously received, upon the exercise of such
Options and Warrants (i) to continue to fund and expand its research and
development programs and (ii) for general corporate purposes, including working
capital. There can be no assurance that any of the Options will be exercised.
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<PAGE>
SELLING STOCKHOLDERS
This Prospectus covers possible sales by the Selling Stockholders, who are
officers and directors of the Company who may be "affiliates" of the Company (as
such term is defined under Rule 405 under the Securities Act), of Shares that
such Selling Stockholders have acquired and/or may acquire through the exercise
of Options granted under the Plans and/or Warrants. The names of such officers
and directors who may be Selling Stockholders from time to time are listed
below, along with, as of September 25, 1998, (i) the number of shares of Common
Stock currently owned by each such person, (ii) the number of Shares offered by
each such person for sale hereby and (iii) the number of shares of Common Stock
to be owned by each such Selling Stockholder following the completion of the
offering contemplated hereby and the percentage that such shares will bear to
the number of outstanding shares of Common Stock at such time. The number of
Shares offered for sale by such individuals may be updated in, and additional
individuals who are affiliates of the Company may be added as Selling
Stockholders hereunder by, supplements to this Prospectus, which will be filed
with the Commission in accordance with Rule 424(b) under the Securities Act. In
reliance upon Item 2(b) of General Instruction C to Form S-8 under the
Securities Act, the officers and directors of the Company listed below as
Selling Stockholders have been listed herein whether or not such persons have a
present intent to reoffer or resell any or all of the Shares listed as owned by
them and being offered hereby.
Number Percentage
of Shares of Shares
Number Number Beneficially Beneficially
of Shares of Shares Owned After Owned After
Beneficially Offered Completion of Completion of
Selling Stockholder(1) Owned(2) Hereby(3) Offering(4) Offering(4)
- ---------------------- -------- --------- ----------- -----------
Richard Barth 41,500(5) 40,000(5) 1,500 *
Dr. Jean Carvais 48,542(6) 48,542(6) 0 *
Vincent T. DeVita, Jr 90,842(7) 90,542(7) 300 *
Robert F. Goldhammer 836,576(8) 183,232(8) 653,344 2.41%
Carl S. Goldfischer 375,000(9) 375,000(9) 0 *
David M. Kies 107,000(10) 41,397(10) 65,603 *
Paul B. Kopperl 70,960(11) 49,960(11) 21,000 *
John Mendelsohn 212,226(12) 212,226(12) 0 *
William Miller 42,397(13) 41,397(13) 1,000 *
Harlan Waksal 1,245,780(14) 411,578(14) 834,202 3.07%
Samuel Waksal 1,467,583(15) 1,359,000(15) 108,583 *
- ----------
* Less than 1%.
(1) Notwithstanding their respective inclusion in this table as Selling
Stockholders, the individuals listed in this table expressly disclaim that
they are affiliates of the Company.
(2) Assumes that all options or warrants to acquire Common Stock held by such
Selling Stockholder are exercisable within 60 days of the date of this
Prospectus.
(3) Assumes that all Options and Warrants held by such Selling Stockholder are
fully exercisable for the underlying Shares.
(4) Assumes the sale of all Shares offered by all Selling Stockholders under
this Prospectus, and that all options and warrants to acquire Common Stock
held by such Selling Stockholders are exercisable within 60 days of the
date of the completion of the offering. As the Company is unable, as of
the date of this Prospectus, to determine the date of the completion of
the offering hereunder, the number of shares and percentages shown
hereunder are computed with reference to the aggregate number of shares of
Common Stock of the Company issued and outstanding as of September 25,
1998 and giving effect to the exercise of the Options and Warrants. Shares
of the Company's Series A Convertible Preferred Stock are not included, as
no voting rights are attached to such shares.
14
<PAGE>
(5) Includes an aggregate of 40,000 Shares subject to Options granted to
Mr. Barth pursuant to the ImClone Systems Incorporated 1996
Non-Qualified Stock Option Plan. Mr. Barth is a director of the Company
(6) Includes (i) an aggregate of 20,542 Shares subject to Options granted
to Dr. Carvais pursuant to the ImClone Systems Incorporated 1986
Non-Qualified Stock Option Plan and (ii) an aggregate of 28,000 Shares
subject to Options granted to Dr. Carvais pursuant to the ImClone
Systems Incorporated 1996 Non-Qualified Stock Option Plan. Dr. Carvais
is a director of the Company.
(7) Includes (i) an aggregate of 48,542 Shares subject to Options granted
to Dr. DeVita pursuant to the ImClone Systems Incorporated 1986
Non-Qualified Stock Option Plan, (ii) an aggregate of 20,000 Shares
previously acquired by Mr. DeVita upon the exercise of Options granted
thereto pursuant to the ImClone Systems Incorporated 1986 Non-Qualified
Stock Option Plan, and (iii) an aggregate of 22,000 Shares subject to
Options granted to Mr. DeVita pursuant to the ImClone Systems
Incorporated 1996 Non-Qualified Stock Option Plan. Dr. DeVita is a
director of the Company.
(8) Includes (i) an aggregate of 8,542 Shares subject to Options granted to
Mr. Goldhammer pursuant to the ImClone Systems Incorporated 1986
Non-Qualified Stock Option Plan, (ii) an aggregate of 105,000 Shares
subject to Options granted to Mr. Goldhammer pursuant to the ImClone
Systems Incorporated 1996 Non-Qualified Stock Option Plan and (iii) an
aggregate of 69,690 Shares subject to Warrants issued to Mr.
Goldhammer. The additional shares of Common Stock listed under the
column "Number of Shares Beneficially Owned" include 13,314 shares of
Common Stock held in trust, as to which Mr. Goldhammer disclaims
beneficial ownership. Mr. Goldhammer is the Chairman of the Company's
Board of Directors.
(9) Includes (i) an aggregate of 350,000 Shares subject to Options granted
to Dr. Goldfischer pursuant to the ImClone Systems Incorporated 1996
Non-Qualified Stock Option Plan and (ii) an aggregate of 25,000 Shares
subject to Options granted to Dr. Goldfischer pursuant to the ImClone
Systems Incorporated 1996 Incentive Stock Option Plan. Dr. Goldfischer
is the Company's Vice President, Finance and Chief Financial Officer.
(10) Includes (i) an aggregate of 25,000 Shares subject to Options granted
to Mr. Kies pursuant to the ImClone Systems Incorporated 1996
Non-Qualified Stock Option Plan and (ii) an aggregate of 16,397 Shares
previously acquired by Mr. Kies upon the exercise of Options granted
thereto pursuant to the ImClone Systems Incorporated 1996 Non-Qualified
Stock Option Plan. The additional shares of Common Stock listed under
the column "Number of Shares Beneficially Owned" include 6,000 shares
of Common Stock held by Mr. Kies as custodian for his son, as to which
Mr. Kies disclaims beneficial ownership. Mr. Kies is a director of the
Company.
(11) Includes (i) an aggregate of 7,500 Shares subject to Options granted to
Mr. Kopperl pursuant to the ImClone Systems Incorporated 1986
Non-Qualified Stock Option Plan and (ii) an aggregate of 40,000 Shares
subject to Options granted to Mr. Kopperl pursuant to the ImClone
Systems Incorporated 1996 Non-Qualified Stock Option Plan. The
additional shares of Common Stock listed under the column "Number of
Shares Beneficially Owned" include 500 shares of Common Stock held by
Mr. Kopperl's spouse as to which Mr. Kopperl disclaims beneficial
ownership. Mr. Kopperl is a director of the Company.
(12) Includes (i) an aggregate of 120,000 Shares subject to Options granted
to Dr. Mendelsohn pursuant to the ImClone Systems Incorporated 1986
Non-Qualified Stock Option Plan and (ii) an aggregate of 92,226 Shares
subject to Options granted to Dr. Mendelsohn pursuant to the ImClone
Systems Incorporated 1996 Non-Qualified Stock Option Plan. Dr.
Mendelsohn is a director of the Company.
(13) Includes an aggregate of 41,397 Shares subject to Options granted to
Mr. Miller pursuant to the ImClone Systems Incorporated 1996
Non-Qualified Stock Option Plan. Mr. Miller is a director of the
Company.
(14) Includes (i) an aggregate of 390,000 Shares subject to Options granted
to Dr. Waksal pursuant to the ImClone Systems Incorporated 1996
Non-Qualified Stock Option Plan and the ImClone Systems Incorporated
1996 Incentive Stock Option Plan, (ii) an aggregate of 3,180 Shares
subject to Warrants issued to Dr. Waksal and (iii) an aggregate of
18,398 Shares previously acquired by Dr. Waksal upon the exercise of
Options granted thereto pursuant to the ImClone Systems Incorporated
1986 Non-Qualified Stock Option Plan. Dr. Harlan Waksal is the
Company's Executive Vice President and Chief Operating Officer and a
director of the Company. Dr. Harlan Waksal and Dr. Samuel Waksal are
brothers.
(15) Includes (i) an aggregate of 75,000 Shares subject to Options granted
to Dr. Waksal pursuant to the ImClone Systems Incorporated 1986
Non-Qualified Stock Option Plan, (ii) an aggregate of 595,000 Shares
subject to Options granted
15
<PAGE>
to Dr. Waksal pursuant to the ImClone Systems Incorporated 1996
Non-Qualified Stock Option Plan and the ImClone Systems Incorporated
1996 Incentive Stock Option Plan, (iii) an aggregate of 350,000 Shares
subject to Warrants issued to Dr. Waksal and (iv) an aggregate of
339,000 Shares previously acquired by Dr. Waksal upon the exercise of
Warrants issued thereto. Dr. Samuel Waksal is the Company's President
and Chief Executive Officer. Dr. Samuel Waksal and Dr. Harlan Waksal
are brothers.
PLAN OF DISTRIBUTION
The Shares, which have been issued and/or are issuable upon the exercise
of the Options or Warrants may be sold pursuant to this Prospectus by the
Selling Stockholders. These sales may occur in privately negotiated transactions
or in the over-the-counter market through brokers and dealers, as agents, or to
brokers and dealers, as principals who may receive compensation in the form of
discounts, concessions or commissions from the Selling Stockholders or from the
purchasers of the Common Stock for whom the broker-dealers may act as agent or
to whom they may sell as principal, or both. After the passage of the requisite
period of time, the Selling Stockholders may also sell the Shares pursuant to
Rule 144. The Company has been advised by the Selling Stockholders that they
have not made any arrangements relating to the distribution of the Shares. In
effecting sales, broker-dealers engaged by the Selling Stockholder may arrange
for other broker-dealers to participate. Broker-dealers will receive commissions
or discounts from the Selling Stockholder in amounts to be negotiated
immediately prior to the sale.
Upon being notified by a Selling Stockholder that any material arrangement
(other than a customary brokerage account agreement) has been entered into with
a broker or dealer for the sale of Shares pursuant to this Prospectus through a
block trade, purchase by a broker or dealer, or similar transaction, the Company
will file a supplemented Prospectus pursuant to Rule 424(c) under the Securities
Act disclosing (a) the name of each such broker-dealer, (b) the number of Shares
involved, (c) the price at which such Shares were sold, (d) the commissions paid
or discounts or concessions allowed to such broker-dealer(s), (e) if applicable,
that such broker-dealer(s) did not conduct any investigation to verify the
information set out or incorporated by reference in the Prospectus, as
supplemented, and (f) any other facts material to the transaction.
The Selling Stockholders and any broker-dealers who execute sales for the
Selling Stockholders may be deemed to be "underwriters" within the meaning of
the Securities Act by virtue of the number of shares of Common Stock to be sold
or resold by such persons or entities or the manner of sale thereof, or both. If
the Selling Stockholders or any broker-dealer or other holders were determined
to be underwriters, any discounts, concessions or commissions received by them
or by brokers or dealers acting on their behalf and any profits received by them
on the resale of their shares of Common Stock might be deemed underwriting
discounts and commissions under the Securities Act.
The Selling Stockholders have represented to the Company that any purchase
or sale of the Common Stock by them will be in compliance with Regulation M
("Regulation M") promulgated under the Exchange Act. In general, Rule 102 under
Regulation M prohibits any person connected with a distribution of the Company's
Common Stock (the "Distribution") from directly or indirectly bidding for, or
purchasing for any account in which he has a beneficial interest, any Common
Stock or any right to purchase Common Stock, for a period of one business day
prior to and subsequent to completion of his participation in the Distribution
(the "Distribution Period").
During the Distribution Period, Rule 104 ("Rule 104") under Regulation M
prohibits the Selling Stockholders and any other persons engaged in the
Distribution from engaging in any stabilizing bid or purchasing the Common Stock
except for the purpose of preventing or retarding a decline in the open market
price of the Common Stock. No such person may effect any stabilizing transaction
to facilitate any offering at the market. Inasmuch as any Selling Stockholder
will be reoffering and reselling the Common Stock at the market, Rule 104
prohibits him or her from effecting any stabilizing transaction in contravention
of Rule 104 with respect to the Common Stock.
LEGAL MATTERS
Certain legal matters in connection with the sale and validity of the
Shares will be passed upon for the Company by Kaye, Scholer, Fierman, Hays &
Handler, LLP.
16
<PAGE>
DISCLOSURE OF COMMISSION POSITION ON
INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
The Company's Certificate of Incorporation and Bylaws provide for
indemnification of officers and directors in instances, among others, in which
they acted in good faith and in a manner they reasonably believed to be in, or
not opposed to, the best interests of the Company and in which, with respect to
criminal proceedings, they had no reasonable cause to believe their conduct was
unlawful.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Company pursuant to the foregoing provisions, or otherwise, the Company has
been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable.
17
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
The contents of ImClone Systems Incorporated's (the "Company")
Registration Statement on Form S-8, File No.333-10275, filed with the Securities
and Exchange Commission (the "Commission") on August 15, 1996 are incorporated
herein by reference.
Item 8. Exhibits.
Exhibit No. Description
- ----------- -----------
5.1 Opinion of Kaye, Scholer, Fierman, Hays & Handler, LLP with
respect to the legality of the securities being registered. (Filed
herewith).
23.1 Consent of KPMG Peat Marwick LLP. (Filed herewith).
23.2 Consent of Kaye, Scholer, Fierman, Hays & Handler, LLP. (Included
in Exhibit 5.1).
24. Power of Attorney. (Included on signature pages to this
Registration Statement).
99.1 ImClone Systems Incorporated 1996 Incentive Stock Option Plan, As
Amended. (Incorporated by reference to Exhibit No. 99.1 of ImClone
Systems Incorporated's Quarterly Report of Form 10-Q for the
fiscal quarter ended June 30, 1997).
99.2 ImClone Systems Incorporated 1996 Non-Qualified Stock Option Plan,
As Amended. (Incorporated by reference to Exhibit 99.2 of ImClone
Systems Incorporated's Quarterly Reporting Form 10-Q for the
fiscal quarter ended June 30, 1997).
18
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of New York, State of New York, on the 30th day of
September 1998.
IMCLONE SYSTEMS INCORPORATED
By: /s/ Samuel D. Waksal
----------------------------------------
Samuel D. Waksal
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated. Each person whose individual signature
appears below hereby authorizes Samuel D. Waksal, Harlan W. Waksal and John B.
Landes, or any of them, to execute in the name and on behalf of each such person
and to file any amendment to this Registration Statement, and appoints Samuel D.
Waksal, Harlan W. Waksal and John B. Landes, or any of them, as attorney-in-fact
to sign on his behalf individually and in each capacity stated below, and to
file any amendments to this Registration Statement, including any and all
post-effective amendments.
Signature Title Date
--------- ----- ----
/s/ Robert F. Goldhammer Chairman of the Board September 30, 1998
- ------------------------- and Director
Robert F. Goldhammer
/s/ Samuel D. Waksal President, Chief Executive September 30, 1998
- ------------------------- Officer
Samuel D. Waksal and Director
(Principal Executive Officer)
/s/ Harlan W. Walsal Executive Vice President, September 30, 1998
- ------------------------- Chief Operating
Harlan W. Waksal Officer and Director
/s/ Carl Goldfischer Vice President of Finance September 30, 1998
- ------------------------- and Chief Financial
Carl Goldfischer Officer (Principal
Financial and Accounting
Officer)
/s/ Jean Carvais Director September 30, 1998
- -------------------------
Jean Carvais
/s/ Vincent T. DeVita, Jr. Director September 30, 1998
- --------------------------
Vincent T. DeVita, Jr.
/s/ Paul B. Kopperl Director September 30, 1998
- -------------------------
Paul B. Kopperl
/s/ William R. Miller Director September 30, 1998
- -------------------------
William R. Miller
/s/ Davis M. Kies Director September 30, 1998
- -------------------------
David M. Kies
/s/ John Mendelsohn Director September 30, 1998
- -------------------------
John Mendelsohn
/s/ Richard Barth Director September 30, 1998
- -------------------------
Richard Barth
S-1
<PAGE>
EXHIBIT INDEX
Exhibit
No. Description
- --- -----------
5.1 Opinion of Kaye, Scholer, Fierman, Hays & Handler, LLP with respect to
the legality of the securities being registered. (Filed herewith).
23.1 Consent of KPMG Peat Marwick LLP. (Filed herewith).
23.2 Consent of Kaye, Scholer, Fierman, Hays & Handler, LLP. (Included in
Exhibit 5.1).
24. Power of Attorney. (Included on signature pages to this Registration
Statement).
99.1 ImClone Systems Incorporated 1996 Incentive Stock Option Plan, As
Amended. (Incorporated by reference to Exhibit No. 99.1 of ImClone
Systems Incorporated's Quarterly Report of Form 10-Q for the fiscal
quarter ended June 30, 1997).
99.2 ImClone Systems Incorporated 1996 Non-Qualified Stock Option Plan, As
Amended. (Incorporated by reference to Exhibit 99.2 of ImClone Systems
Incorporated's Quarterly Reporting Form 10-Q for the fiscal quarter
ended June 30, 1997).
EXHIBIT 5.1
[Kaye, Scholer, Fierman, Hays & Handler, LLP Letterhead]
(212) 836-8000
September 30, 1998
ImClone Systems Incorporated
180 Varick Street
New York, New York 10014
Ladies and Gentlemen:
We have acted as special counsel to ImClone Systems Incorporated, a
Delaware corporation (the "Company"), in connection with the Company's
registration statement on Form S-8 (the "Registration Statement") to be filed
pursuant to the Securities Act of 1933, as amended. The Registration Statement
relates to an aggregate of 1,500,000 shares of the Company's Common Stock, par
value $.001 per share (the "Common Stock"), which may be issued upon the
exercise of stock options to be granted pursuant to the ImClone Systems
Incorporated 1996 Non-Qualified Stock Option Plan, As Amended or the ImClone
Systems Incorporated 1996 Incentive Stock Option Plan, As Amended (together, the
"Option Plans").
In that connection, we have reviewed the Company's certificate of
incorporation, as amended, its by-laws, resolutions adopted by its Board of
Directors and its stockholders, the Registration Statement, the Option Plans and
such other documents and proceedings as we have deemed appropriate.
On the basis of such review, and having regard to legal considerations
that we deem relevant, we are of the opinion that the shares of Common Stock to
be offered pursuant to the Registration Statement have been duly authorized and,
when issued in accordance with the terms set forth in the Option Plans, will be
validly issued, fully paid and nonassessable.
Our opinion set forth above is based as to matters of law solely on
applicable provisions of the General Corporation Law of the State of Delaware,
and we express no opinion as to any other laws, statutes, ordinances, rules or
regulations.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. In giving this opinion, we do not thereby admit that we
are within the category of persons whose consent is required under Section 7 of
the Securities Act of 1933, as amended or the rules and regulations of the
Securities and Exchange Commission.
Very truly yours,
/s/ Kaye, Scholer, Fierman, Hays & Handler, LLP
----------------------------------------------------
Kay, Scholer, Fierman, Hays & Handler, LLP
EXHIBIT 23.1
The Board of Directors
Imclone Systems Incorporated
We consent to the use of our report incorporated herein by reference.
KPMG Peat Marwick LLP
New York, New York
September 30, 1998
