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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): APRIL 9, 1997
CYTEL CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation)
0-19591 33-0245076
(Commission File No.) (IRS Employer Identification No.)
3525 JOHN HOPKINS COURT
SAN DIEGO, CA 95121
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (619) 552-3000
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ITEM 5. OTHER EVENTS.
On April 9, 1997, Cytel Corporation (the "Company") announced
that it is restructuring operations and spinning off its vaccine program to
form a new company. The new company will focus on novel vaccines for treatment
and prevention of cancer and infectious diseases, capitalizing on the
immunology research expertise developed to support its Theradigm(TM) program.
Cytel will continue to develop its therapeutic products targeting acute and
chronic inflammation, and expand its carbohydrate manufacturing business with
the goal of generating additional near term revenue.
The restructuring has been approved by the Company's board of
directors, and will occur as soon as practicable dependent upon legal, market
and other considerations. The Company is considering a public spinoff structure
as well as other financing opportunities. Specific financing and structures
have yet to be determined.
Further detail regarding the restructuring is provided in the
Company's press release relating to this event, a copy of which is attached
hereto as Exhibit 99.1.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(C) EXHIBITS.
99.1 Press Release of Cytel Corporation dated April 9,
1997.
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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.
CYTEL CORPORATION
Dated: April 9, 1997 By: /S/ VIRGIL D. THOMPSON
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Virgil D. Thompson
Chief Executive Officer
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INDEX TO EXHIBITS
PAGE NO.
99.1 Press Release of Cytel Corporation dated April 9, 1997. 5
4.
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EXHIBIT 99.1
Contact:
Deborah Schueren
Vice President and Chief Financial Officer
(619) 552-3000
CYTEL TO SPIN OFF VACCINE COMPANY
SAN DIEGO, CA -- April 9, 1997 -- Cytel Corporation (Nasdaq:CYTL)
today announced that it is restructuring operations and spinning off its
vaccine program to form a new company. The new company will focus on novel
vaccines for treatment and prevention of cancer and infectious diseases,
capitalizing on the immunology research expertise developed to support its
Theradigm(TM) program. Cytel will continue to develop its therapeutic products
targeting acute and chronic inflammation, and expand its carbohydrate
manufacturing business with the goal of generating additional near term
revenue.
"We firmly believe that the establishment of separately managed and
financed companies is the best formula for building long-term shareholder value
from Cytel's current product and technology portfolio," said Virgil Thompson.
"These entities are developing products based on distinctively different
technologies, have different product portfolios, and are pursuing different
business strategies."
The restructuring has been approved by the company's board of
directors, and will occur as soon as practicable dependent upon legal, market
and other considerations. The company is considering a public spin-off
structure as well as other financing opportunities. Specific financing plans
and structures have yet to be determined.
THE NEW CYTEL
"Cytel will now focus on development, manufacturing and
commercialization of pharmaceutical and carbohydrate products," Mr. Thompson
said. "We have a very promising product in clinical trials, a broad-based
exploratory program to develop small molecule integrin blockers for chronic
inflammatory diseases and positive preclinical data with CY1748 in deep vein
thrombosis."
"In addition, our glycotechnology business unit, known as Glytec(TM),
offers a near term revenue opportunity. We have carbohydrate manufacturing
contracts with two major international companies for healthcare and consumer
products, and we are in active
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negotiations with several additional potential partners. Our goal is to become
recognized as the leader in the manufacture of bioactive carbohydrates."
"With revenue from Glytec and reduced expenses following the
restructuring, we will be able to pursue our therapeutic programs more
aggressively, while reducing our overall burn rate," he added.
Virgil Thompson, president and chief executive officer and Robert L.
Roe, M.D., executive vice president and chief operating officer, will remain in
their current positions at Cytel. James C. Paulson, Ph.D., general manager of
Glytec, will also become Cytel's chief scientific officer.
PHARMACEUTICAL PRODUCT PIPELINE
Cytel's most advanced therapeutic candidate is Cylexin(TM), a cell
adhesion blocker. Investigators from Harvard Medical School are currently
conducting a Phase II clinical trial at Boston Children's Hospital using
Cylexin in an effort to prevent reperfusion injury in newborns following
cardiopulmonary bypass during surgery for congenital heart disease. Cylexin is
being evaluated as a means to improve post-operative cardiac, pulmonary and
neurologic function in these patients.
By year end, the company intends to initiate preclinical development
on a target compound from a new class of potent integrin blockers with
potential for oral activity. This new class of compounds has shown the ability
to suppress certain white blood cells that cause chronic inflammatory
conditions such as rheumatoid arthritis, multiple sclerosis and asthma.
In a third area, preclinical primate studies on compound CY1748 in a
model of deep vein thrombosis have produced promising results. The compound has
been licensed to Sumitomo for the Pacific Rim, and Cytel is seeking a
commercial partner for the U.S. and Europe.
Cytel intends to continue to build its product pipeline through
in-licensing and internal discovery programs focused on the anti-inflammatory
therapeutic field.
GLYTEC
Glytec was formed to commercialize Cytel's carbohydrate manufacturing
technology. Cytel's proprietary enzymatic synthesis technology is covered by
19 issued patents and 30 additional patent applications, three with notices of
allowance. Currently, Glytec is producing Cylexin, Cytel's carbohydrate-based
human therapeutic.
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As a second element of its commercial strategy, Glytec has
collaborations to produce healthcare and consumer products. The unit currently
has contracts with Abbott Laboratories for infant formula and other nutritional
products and Baxter Healthcare's Nextran unit for a product to prevent human
rejection of transplanted pig organs.
NEW VACCINE COMPANY
The new vaccine company will continue the programs originally
initiated at Cytel focused on immunology and epitope-based immune stimulation.
It will concentrate its significant immunological research and early-stage
development expertise on bringing product candidates forward for the treatment
and prevention of cancer and viral diseases where conventional vaccines are not
effective. The new company expects to develop and commercialize these products
in partnership with pharmaceutical companies.
Consistent with that strategy, exploratory clinical trials with an
ex-vivo vaccine for malignant melanoma are planned this year. A
recently-initiated NIH-sponsored study in HIV-infected patients will continue.
Further preclinical work on the treatment of chronic hepatitis B and other
infectious diseases and cancers will continue, but no further clinical work on
Theradigm(TM) HBV is planned pending the establishment of strategic
partnerships.
As a result of substantial work already done at Cytel, the new vaccine
company will start with a strong proprietary position, including methods of
identification and composition of antigenic epitopes. It will also benefit
from the leadership of the Cytel cellular and molecular immunology research
teams, who will staff the new company. The management team will include Robert
W. Chesnut, Ph.D. currently vice president, immune stimulation program for
Cytel, as senior vice president, R&D, and Alessandro D. Sette, Ph.D., currently
director of immunology at Cytel, as vice president and chief scientific
officer. A new chief executive officer will be hired, and an independent board
of directors will be named.
"We believe that epitope-based vaccines which stimulate potent
disease-specific immunity represent an exciting opportunity to address unmet
medical needs in the treatment and management of life-threatening viral
diseases and cancer. The new company will benefit from being focused entirely
on immunology," Mr. Thompson added.
In addition to the historical information contained herein, this press
release contains forward-looking statements, involving risks and uncertainties.
The timing and activities contemplated by the proposed restructuring may differ
significantly from those discussed in the forward-looking statements due to a
variety of legal, tax and operational uncertainties, including risks associated
with creating and financing new companies. In
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addition, factors that could cause or contribute to differences in actual
results include the timing and results of research and development programs,
preclinical and clinical studies. and patent protection; the time and costs
involved in manufacturing and scale-up, obtaining regulatory approvals and
completing technological developments; and the risks associated with
negotiating and implementing effective commercialization activities and
arrangements. These and other relevant factors are more fully described in
periodic reports filed with the Securities and Exchange Commission, including
the company's Form 10-K for the year ended December 31, 1996.
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CYTEL CORPORATION
ANNOUNCEMENT FACT SHEET
OVERVIEW
On April 9, 1997, Cytel Corp announced a restructuring that will include the
formation of a new vaccine company.
o The New Cytel company will include the company's programs in cell
adhesion-based therapeutics for acute and chronic inflammation and its
glycotechnology business unit, Glytec(TM).
o The new Vaccine company (to be named) will focus on novel vaccines for
cancer and infectious diseases.
Both companies will be managed and financed independently. The restructuring is
expected to take place as soon as practicable dependent upon legal, market and
other considerations.
THE NEW CYTEL COMPANY
BUSINESS STRATEGY
Leverage its leadership position in cell adhesion-based therapeutic product
development and carbohydrate manufacturing, focusing on development,
manufacturing and commercialization of small molecule pharmaceutical products
and carbohydrate pharmaceutical and consumer products. Will expand its product
pipeline through in-licensing and internal discovery programs in the
anti-inflammatory therapeutic field.
THERAPEUTIC PROGRAMS
The new Cytel has three development stage product candidates.
CYLEXIN(TM)
Cell adhesion blocker to prevent reperfusion injury following surgery
in newborns with congenital heart disease.
o Now in Phase II clinical trial at Boston Children's Hospital with
investigators at Harvard Medical School.
o Cytel intends to market Cylexin in the U.S. for this indication. A
partner will be sought for European commercialization.
INTEGRIN BLOCKERS
Development of orally available therapeutics for treatment of chronic
inflammatory diseases from new class of Integrin blockers.
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o Preclinical research shows potential to suppress certain white
blood cells that cause chronic inflammatory conditions such as asthma,
rheumatoid arthritis and multiple sclerosis.
o May partner selected compounds with pharmaceutical company to
commercialize.
CY-1748
Cell adhesion blocker to prevent reperfusion injury and platelet
aggregation in deep vein thrombosis.
o Substantial preclinical data including primate studies, have
produced promising results.
o CY-1748 licensed to Sumitomo for the Pacific Rim; Cytel is seeking
a partner to develop and commercialize for the U.S. and Europe.
GLYTEC
Glytec will be a business unit of the New Cytel - focusing on manufacturing
carbohydrates to produce near term revenues.
o Cylexin, Cytel's proprietary carbohydrate-based human therapeutic, is
manufactured by Glytec.
o Glytec also has collaborations to produce healthcare and consumer products:
- - with Abbott Laboratories for nutritional products including infant formula
- - with Baxter Healthcare's Nextran unit for a product to use in
xenotransplantation
- - in negotiations with other potential collaborators
KEY MANAGEMENT
o Virgil Thompson, President and CEO
o Robert L. Roe, M.D., Executive Vice President and COO
o James C. Paulson, Ph.D., Chief Scientific Officer and General Manager of
Glytec
THE NEW VACCINE COMPANY
BUSINESS STRATEGY
The new company will focus on research and preclinical development of both
therapeutic and prophylactic vaccines.
o Continue immunology and epitope-based immune stimulation programs initiated
at Cytel for the treatment and prevention of cancer and infectious diseases.
o Focus on identifying product candidates for those diseases where
conventional vaccines are not effective.
o Develop and commercialize products in partnership with pharmaceutical
companies.
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PRODUCT FOCUS
MELANOMA
o Exploratory ex vivo clinical trials for malignant melanoma planned
for 1997.
HIV
o Continuation of NIH-sponsored study in HIV-infected patients.
THERADIGM-HBV
o Will establish strategic partnerships before further clinical
studies are conducted for this hepatitis B therapeutic vaccine.
KEY MANAGEMENT
o Chief Executive Officer - to be named
o Robert W. Chesnut, Ph.D., Senior Vice President, R&D
o Alessandro D. Sette, Ph.D., Vice President and Chief Scientific Officer
CONTACT: Deborah Schueren, Vice President and Chief Financial Officer
(619) 552-3000
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