SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
8-K
CURRENT REPORT
Pursuant to Section 13 or 15d) of the
Securities Exchange Act of 1934
Date of Report (Date of Event Reported): January 26, 1999
AGOURON PHARMACEUTICALS, INC.
(Exact name of registrant as specified in its charter)
California 0-15609 33-0061928
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification Number)
10350 North Torrey Pines Road
La Jolla, California 92037
(Address of principal executive offices)
(619) 622-3000
(Registrant's telephone number, including area code)
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Item 5. Other Events.
Agouron Pharmaceuticals, Inc. ("Agouron" or the "Company"),
Warner-Lambert Company, a Delaware corporation ("Warner-Lambert") and WLC
Acquisition Corporation, a California corporation and a wholly owned subsidiary
of Warner-Lambert ("Merger Sub"), have entered into an Agreement and Plan of
Merger, dated as of January 26, 1999 (the "Merger Agreement"), whereby Merger
Sub will be merged with and into the Company, with the Company as the surviving
entity (the "Merger").
As a result of the Merger, each outstanding share of Agouron
Common Stock will be converted into shares of common stock, par value $1.00 per
share, of Warner-Lambert ("Warner-Lambert Common Stock") at an exchange rate
equal to $60.00 divided by the average of the closing sales prices of
Warner-Lambert Common Stock on the New York Stock Exchange Composite
Transactions Tape on each of the 10 consecutive trading days up to and including
the second immediately preceding trading day prior to the date of Agouron's
Stockholders Meeting. In no event will the exchange rate be more than .9300, nor
less than .8108, of a share of Warner-Lambert Common Stock for each share of
Agouron Common Stock. Each outstanding option for shares of Agouron Common Stock
will be converted into options for the number of shares of Warner-Lambert Common
Stock that would have been received if such options and warrants had been
exercised immediately prior to the Merger.
The closing of the Merger is subject to certain conditions,
including the approval of the common stockholders of the Company and the receipt
of customary antitrust clearance.
Concurrently with the execution and delivery of the Merger
Agreement, the Company and Warner-Lambert entered into a Stock Option Agreement
(the "Stock Option Agreement"). Under the Stock Option Agreement, Warner-Lambert
does not have the right to acquire any shares of Agouron Common Stock unless
certain specified events occur. If the option were to become exercisable,
Warner-Lambert would be entitled to purchase upon exercise of the option
(subject to receipt of necessary regulatory approvals) up to approximately 19.9%
of the outstanding shares of Agouron Common Stock. The Stock Option Agreement
provides Warner-Lambert with the right, in certain circumstances, to require
Agouron to repurchase the option and any shares acquired by exercise of the
option and with the right to require Agouron to register the Agouron Common
Stock acquired by or issuable upon exercise of the option under the Securities
Act of 1933, as amended.
In connection with the Merger Agreement, the Company's Board of
Directors has resolved to amend its Amended and Restated Rights Agreement dated
as of November 10, 1998 in order to render the rights issued thereunder
inapplicable to the Merger Agreement, the Stock Option Agreement and the
transactions contemplated thereby.
A copy of the press release, dated January 26, 1999, issued
jointly by the Company and Warner-Lambert, relating to the above-described
transaction is attached as an exhibit to this report and is incorporated herein
by reference.
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Item 7. Financial Statements and Exhibits.
The following exhibit is filed as a part of this report:
Exhibit
NO. DESCRIPTION
99 Press Release of the registrant and
Warner-Lambert dated January 26, 1999
regarding the Merger.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: January 28, 1999
AGOURON PHARMACEUTICALS, INC.
By
Peter Johnson
President and
Chief Executive Officer
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EXHIBIT INDEX
Exhibit
NO. DESCRIPTION
99 Press Release of the registrant and
Warner-Lambert dated January 26, 1999
regarding the Merger.
EXHIBIT 99
AGOURON CONTACT: WARNER-LAMBERT CONTACTS:
Donna Nichols (619) 622-3009
MEDIA CONTACT:
Carol Goodrich (973) 540-3620
INVESTOR RELATIONS CONTACT:
George Shields (973) 540-6916
John Howarth (973) 540-4874
FOR IMMEDIATE RELEASE
WARNER-LAMBERT TO ACQUIRE AGOURON
FOR $2.1 BILLION IN STOCK
Two Industry Leaders to Build Complementary Capabilities in Drug Discovery
MORRIS PLAINS, NJ, and LA JOLLA, CA, January 26, 1999 -- Warner-Lambert
Company (NYSE: WLA) today announced a definitive agreement to acquire Agouron
Pharmaceuticals, Inc. (Nasdaq: AGPH), an integrated pharmaceutical company
committed to the discovery and development of innovative therapeutic products
for treatment of cancer, AIDS and other serious diseases. Agouron achieved total
revenues of $467 million for the fiscal year ended June 30, 1998.
Under the terms of the agreement, which is valued at approximately $2.1
billion, each share of Agouron stock will be exchanged for approximately $60
worth of Warner-Lambert stock so long as the price of Warner-Lambert stock is
between $64.52 and $74.00 at the close of the transaction. In no event will
Agouron shareholders receive less than 0.8108 share of Warner-Lambert common
stock for each share of Agouron common stock, nor more than 0.93 share of
Warner-Lambert common stock for each share of Agouron common stock. The exact
exchange ratio will be based on the average price of Warner-Lambert stock prior
to closing. The transaction will be accounted for as a pooling of interests and
is intended to qualify as a tax-free exchange. It will require the approval of
Agouron's shareholders and the customary regulatory approvals. The transaction
will not require Warner-Lambert shareholder approval and is expected to be
non-dilutive to the Company's future earnings. Under certain circumstances if
the merger agreement is terminated, Warner-Lambert has the option to
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purchase up to 19.9% of Agouron's common stock and has the right to a fee of
at least $60 million.
Melvin R. Goodes, Warner-Lambert chairman and chief executive officer,
said, "The acquisition of Agouron is consistent with our long-term strategy to
supplement our internally generated growth with alliances, acquisitions,
licensing agreements and other creative partnerships. In taking this action, we
believe we have strategically enhanced our prospects for long-term growth
without sacrificing our ability to meet expectations of superior near-term
earnings performance. We believe that by concentrating our resources and
expanding into important new therapeutic categories, we will be well-positioned
to continue our impressive growth in the pharmaceutical sector, even in the face
of challenging market conditions and an increasingly global business
environment."
Peter Johnson, Agouron president and chief executive officer, said,
"This is a carefully considered strategic move to maximize Agouron's long-term
ability to bring forward new drugs for patients confronted by cancer, viral
infections, and diseases of the eye and, at the same time, to contribute its
scientific strengths to Warner-Lambert's efforts to discover innovative drugs in
other important therapeutic fields. Our Board unanimously concluded that this
transaction is in the best interests of shareholders, as it should provide
prospects for further value enhancement based on Warner-Lambert's impressive
performance record."
Through this transaction, Warner-Lambert will markedly augment its new
product pipeline and will significantly expand its presence in important
therapeutic areas such as anti-virals and oncology. In addition to gaining
access to several promising late-stage compounds, the acquisition immediately
provides Warner-Lambert with the market leading HIV product for the treatment of
HIV in adults and children. VIRACEPT(R) (nelfinavir mesylate), Agouron's first
commercial product, is an HIV protease inhibitor that received marketing
clearance from the U.S. Food and Drug Administration in 1997.
"Warner-Lambert's acquisition of Agouron is another demonstration of
our commitment to sustain our position among the fastest growing companies in
the pharmaceutical industry. We have already made significant progress by more
than doubling our worldwide pharmaceutical business in less than two years. In
1996, our worldwide pharmaceutical revenues totaled $2.5 billion. By the end of
1999, we expect they will exceed $7 billion. This
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merger is intended to strengthen our research and development capabilities
through access to complementary technologies such as structure-based drug
design," said Anthony H. Wild, president, pharmaceutical sector of
Warner-Lambert.
Warner-Lambert and Agouron agreed that this transaction will enhance
both companies' capabilities in drug discovery. Agouron will gain global reach
in development and commercial infrastructure, which is of particular importance
with several new product launches anticipated in the next few years. Agouron
will also benefit from additional resources that will permit it to expand its
innovative approach to rational drug design.
Agouron, based in La Jolla, California, is an integrated pharmaceutical
company engaged in the discovery, development and commercialization of drugs for
treatment of cancer, viral diseases, and diseases of the eye. The Company is
distinguished as an innovator and leader in the design of novel synthetic drugs
based upon the molecular structures of target proteins that play key roles in
human disease. It has integrated this technology with high-throughput screening
of combinatorial chemical libraries. Agouron's anti-HIV drug, VIRACEPT, marketed
in North America by the Company's own commercial organization, is the market
leader of drugs for treatment of HIV infection and AIDS in the United States.
The company employs more than 1000 people of whom approximately 700 are engaged
in research and development.
Warner-Lambert is a worldwide company devoted to discovering,
developing, manufacturing, and marketing quality pharmaceutical, consumer health
care, and confectionery products. Warner-Lambert employs more than 40,000 people
worldwide.
Statements made in this press release that state "we believe," or other
wise state the Company's predictions for the future are forward-looking
statements. Actual results might differ materially from those projected in the
forward-looking statements. Additional information concerning factors that could
cause actual results to materially differ from those in the forward-looking
statements is contained in the Company's Annual Report on Form 10K for the year
ended June 30, 1998 filed with the U.S. Securities and Exchange Commission. For
a copy of this filing, please call the media or investor relations contacts
listed on this press release.
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Note to Editors: For more information on Agouron, you may visit
the Agouron Web Site at:
http://www.agouron.com and for more information on Warner-Lambert's you may go
to www.warner-lambert.com.
VIRACEPT(R) is a registered trademark of Agouron Pharmaceuticals, Inc.
VIRACEPT is indicated for the treatment of HIV infection when
antiretroviral therapy is warranted. This indication is based on analyses of
surrogate marker changes in patients who received VIRACEPT in combination with
nucleoside analogues or alone for up to 24 weeks. At present, there are no
results from controlled trials evaluating the effect of therapy with VIRACEPT on
clinical progression of HIV infection, such as survival or the incidence of
opportunistic infections.
The most commonly observed adverse event of moderate or greater
severity in clinical trials of VIRACEPT was diarrhea, which was generally
controlled with over-the-counter medications. New onset or exacerbation of
diabetes mellitus and hyperglycemia, as well as increased bleeding in patients
with hemophilia types A and B, have been reported with protease inhibitors.
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