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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): March 26, 1999
CYTEL CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation)
0-19591 35-0245076
(Commission File No.) (IRS Employer Identification No.)
9393 TOWNE CENTRE DRIVE
SAN DIEGO, CA 92121
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (619) 450-7100
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
On March 26, 1999, Cytel Corporation (the "Company") sold its
carbohydrate manufacturing business to Neose Technologies, Inc. ("Neose"). Neose
paid Cytel $3.5 million in cash and paid an additional $1.5 million into escrow,
the release of which is conditioned on Cytel's satisfaction of certain matters
relating to the patents and licenses acquired by Neose. Neose may pay Cytel up
to an additional $1.6 million contingent on potential payments and revenues
realized by Neose in connection with certain future corporate collaborations.
Under the agreement, Neose acquired all of Cytel's carbohydrate synthesis and
manufacturing technology, including patent rights and rights under license
agreements. Neose acquired such technology subject to the rights and licenses
granted to Baxter Healthcare Corporation's Nextran unit in the field of
xenotransplantation.
A description of the transaction is set forth in the Press Release
issued by the Company and Neose, dated as of March 29, 1999, a copy of which is
attached hereto as Exhibit 99.1.
ITEM 7. PRO FORMA FINANCIAL INFORMATION
At the time of the filing of this report, it is impracticable
to provide the pro forma financial information required to be filed with respect
to the sale of assets described above in Item 2 (the "Pro Form Financial
Information"). The Pro Forma Financial Information will be filed within sixty
(60) days of the date this report on Form 8-K is required to be filed.
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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 8, 1999 By: /S/ VIRGIL THOMPSON
--------------------------------------------
Virgil Thompson
President and Chief Executive Officer
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EXHIBIT 99.1
NEOSE TECHNOLOGIES ACQUIRES CARBOHYDRATE MANUFACTURING
TECHNOLOGIES FROM CYTEL CORPORATION
Cytel to Focus on Therapeutic Programs
HORSHAM, PA and SAN DIEGO, CA--(BUSINESS WIRE)--March 29, 1999-- Neose
Technologies, Inc. (NASDAQ:NTEC - news) and Cytel Corporation (NASDAQ:CYTL -
news) announced today that Neose has acquired the carbohydrate manufacturing
patents, licenses and other intellectual property of Cytel's Glytec business
unit.
Under the agreements, Neose has acquired:
-- 6 issued U.S. patents, 8 pending U.S. applications, 2 provisional U.S.
applications, and foreign counterparts, owned by Cytel;
-- Cytel's license and option agreements with The Scripps Research
Institute, the University of Michigan, the University of Alberta, the University
of California at Los Angeles, National Research Council of Canada, the
University of Arkansas, Japan Tobacco Corporation, and Marukin Shoyu Ltd., which
licenses and options together cover an additional 29 issued U.S. patents, 25
pending U.S. patent applications, and foreign counterparts thereof;
-- Cytel's Sugar Nucleotide Cycling (SNC(R)) technology; and
-- Cytel's glycoprotein remodeling program and related technologies.
Neose paid Cytel $3.5 million in cash, and paid an additional $1.5 million into
escrow, the release of which is conditioned on:
Cytel's satisfaction of certain matters relating to the acquired patents and
licenses, and Neose may pay to Cytel up to an additional $1.6 million,
contingent on potential payments and revenues realized by Neose in connection
with certain future corporate collaborations.
James Paulson, Ph.D., who recently resigned as vice president and chief
scientific officer of Cytel in order to become a professor in the department of
molecular biology at The Scripps Research Institute, has become a consultant to
Neose and a member of Neose's Scientific Advisory Board.
Neose's chairman and chief executive officer, Stephen Roth, said, "With these
transactions, we believe that Neose has added significantly to its broad
technologies that enable the enzymatic synthesis of complex carbohydrates. Under
Dr. Paulson's scientific leadership, Cytel has been a true innovator in
carbohydrate synthesis. Cytel's technologies are complementary with Neose's in
important ways, and should position Neose well for many future business
opportunities. We are also pleased to gain the benefit of Dr. Paulson's talents
and insights as a consultant and member of our Scientific Advisory Board."
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"This successfully accomplishes our previously announced goal of divesting our
carbohydrate manufacturing technology," said Virgil Thompson, Cytel's president
and chief executive officer, "and enables us to focus on our core therapeutic
programs."
Cytel's rights to continue development and manufacture Cylexin(R) are unaffected
by the sale, as is its previously announced license of Cytel's technology to the
Nextran subsidiary of Baxter International (NYSE:BAX - news) in the field of
xenotransplantation.
Neose is focused on the enzymatic synthesis of complex carbohydrates, and the
discovery, development, and commercialization of complex carbohydrates for
nutritional, pharmaceutical, consumer, and industrial uses. Neose's initial
focus is developing nutritional additives for infant formula, and pharmaceutical
products to treat pediatric ear infections, gastritis and peptic ulcers. Neose
is also developing and manufacturing carbohydrates for use in oncologic vaccines
for third party clinical trials. The Company believes its proprietary technology
platform enables the rapid and cost-effective enzymatic synthesis of commercial
quantities of a wide range of complex carbohydrates.
The statements set forth in this press release that are not historical facts or
statements of current condition are forward-looking statements. These
forward-looking statements, such as statements regarding present or anticipated
scientific progress, development of potential pharmaceutical products, future
revenues, capital expenditures, research and development expenditures, future
financings and collaborations, management, manufacturing development and
capabilities, and other statements regarding matters that are not historical
facts, involve predictions. The Company's actual results, performance, or
achievements could differ materially from the results expressed in, or implied
by, these forward-looking statements. Potential risks and uncertainties that
could affect the Company's actual results, performance, or achievements include,
but are not limited to, the "Risk Factors" set forth in Item 1 of the Company's
Annual Report on Form 10-K, and general financial, economic, regulatory, and
political conditions affecting the biotechnology industry in general. Given
these uncertainties, current or prospective investors are cautioned not to place
undue reliance on any such forward-looking statements. Furthermore, the Company
disclaims any obligation or intent to update any such factors or forward-looking
statements to reflect future events or developments.
This release and prior releases are available on the Neose Technologies website
at www.Neose.com and the KCSA Worldwide website at www.KCSA.com.
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