<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the Quarterly period ended March 31, 2000
OR
[ ] Transition report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
Commission File Number 001-13835
OPHIDIAN PHARMACEUTICALS, INC.
(Exact name of registrant as specified in its Charter)
DELAWARE 39-1661164
-------- ----------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
5445 East Cheryl Parkway, Madison, WI 53711
-------------------------------------------
(Address of Principal Executive Offices and Zip Code)
(608) 271-0878
--------------
(Registrant's Telephone Number, Including Area Code)
Indicate by check mark whether the registrant: (1) filed all reports required to
be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
-----
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Outstanding
Class May 04, 2000
----- ------------
Common Stock, $0.0025 par 1,158,017
value
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OPHIDIAN PHARMACEUTICALS, INC.
QUARTERLY REPORT ON FORM 10-Q
QUARTER ENDED MARCH 31, 2000
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE NO.
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<S> <C>
PART I FINANCIAL INFORMATION
Item 1 Financial Statements
Condensed Balance Sheets - March 31, 2000 and
September 30, 1999. 3
Condensed Statements of Operations -
Three-months ended March 31, 2000 and 1999,
six-months ended March 31, 2000 and 1999 and
the period from inception (November 11, 1989)
to March 31, 2000. 4
Condensed Statements of Cash Flows -
Six-months ended March 31, 2000 and 1999 and
the period from inception (November 11, 1989)
to March 31, 2000. 5
Notes to Condensed Financial Statements. 6
Item 2 Management's Discussion and Analysis of Financial Condition
and Results of Operations 7
PART II OTHER INFORMATION 11
EXHIBITS 13
SIGNATURES 14
</TABLE>
2
<PAGE> 3
OPHIDIAN PHARMACEUTICALS, INC.
(A DEVELOPMENT STAGE CORPORATION)
BALANCE SHEETS
<TABLE>
<CAPTION>
SEPTEMBER 30, MARCH 31,
1999 2000
---- ----
ASSETS (UNAUDITED)
<S> <C> <C>
Current assets:
Cash and cash equivalents.................................... $ 3,416,490 $ 2,338,158
Accounts receivable.......................................... 4,112 4,112
Prepaid expenses and other................................... 68,803 52,556
------------ -----------
Total current assets....................................... 3,489,405 2,394,826
Other assets................................................... 624,543 188,863
Equipment and leasehold improvements
Furniture and fixtures....................................... 115,225 119,896
Manufacturing equipment...................................... 1,086,070 1,957,820
Laboratory equipment......................................... 663,047 664,778
Office equipment............................................. 50,071 55,055
Leasehold improvements....................................... 65,095 91,917
Construction in progress..................................... 70,607 2,003,549
------------ -----------
2,050,115 4,893,015
Accumulated depreciation..................................... (860,732) (1,035,101)
------------ -----------
Net equipment and leasehold improvements....................... 1,189,383 3,857,914
Patent costs, net of accumulated amortization of
$67,977 and $80,739, September 30, 1999, and
March 31, 2000, respectively................................. 1,518,795 1,521,598
------------ -----------
Total assets............................................... $ 6,822,126 $7,963,201
============ ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable............................................. $ 175,871 $ 739,866
Accrued expenses and other liabilities....................... 93,063 179,925
Current portion of capital lease obligations................. 2,561 2,431
------------ -----------
Total current liabilities.................................. 271,495 922,222
Capital lease obligations, less current portion................ 9,687 8,662
Senior note - 1,618,495
Deferred revenue - noncurrent.................................. 354,310 354,310
Commitments and contingencies
Shareholders' equity:
Common stock, $.0025 par value, 2,800,000 shares
authorized, 1,155,047 and 1,158,017 issued and
outstanding at September 30, 1999, and March 31, 2000, 2,888 2,894
respectively
Additional paid-in capital................................... 22,496,324 22,504,322
Deficit accumulated during the development stage............. (16,312,578) (17,447,704)
------------ -----------
Total shareholders' equity..................................... 6,186,634 5,059,512
------------ -----------
Total liabilities and shareholders' equity..................... $ 6,822,126 $ 7,963,201
============ ===========
</TABLE>
See accompanying notes to condensed financial statements.
3
<PAGE> 4
OPHIDIAN PHARMACEUTICALS, INC.
(A DEVELOPMENT STAGE CORPORATION)
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
(UNAUDITED) (UNAUDITED) (UNAUDITED)
THREE MONTHS ENDED SIX MONTHS ENDED NOTE A
MARCH 31, MARCH 31, MARCH 31,
------------------------------ -------------------------------- ---------
1999 2000 1999 2000 2000
----------------- ------------ --------------- --------------- ----------------
<S> <C> <C> <C> <C> <C>
Revenues:
Sale of patents $ - $1,300,000 $ - $1,300,000 $1,300,000
Contracts 4,915 - 5,605 - 3,405,153
License fees 1,000 - 1,000 - 1,217,519
---------- ------------ ----------- ----------- ----------------
Total revenues 5,915 1,300,000 6,605 1,300,000 5,922,672
Costs & expenses:
Cost of patents sold - 83,481 - 83,481 83,481
Research & development..... 824,671 641,738 1,681,611 1,682,533 15,624,180
General & administrative... 400,461 306,731 866,351 716,638 9,084,333
---------- ------------ ----------- ----------- ----------------
Total costs & expenses 1,225,132 1,031,950 2,547,962 2,482,652 24,791,994
------------ ------------ ----------- ----------- ----------------
Operating income (loss)...... (1,219,217) 268,050 (2,541,357) (1,182,652) (18,869,322)
Non-operating income 90,656 123,523 144,821 47,526 1,421,618
------------ ------------ ----------- ----------- ----------------
Net income (loss)........ $(1,128,561) $391,573 $(2,396,536) $(1,135,126) $ (17,447,704)
============ ============ =========== =========== ================
Net income (loss) per share..
Basic $ (0.98) $ 0.34 $ (2.08) $ (0.98)
Diluted $ (0.98) $ 0.32 $ (2.08) $ (0.98)
</TABLE>
See accompanying notes to condensed financial statements.
Note A; Period from Inception (November 11, 1989) to Date, March 31, 2000
4
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OPHIDIAN PHARMACEUTICALS, INC.
(A DEVELOPMENT STAGE CORPORATION)
STATEMENTS OF CASH FLOWS
UNAUDITED
<TABLE>
<CAPTION>
NOTE A
SIX MONTHS ENDED MARCH 31, MARCH 31,
--------------------------- ---------
OPERATING ACTIVITIES 1999 2000 2000
---- ---- ----
<S> <C> <C> <C>
Net loss...................................... $(2,396,536) $(1,135,126) $ (17,447,704)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation and amortization............... 172,529 187,131 1,167,095
Loss on sale of investments................. - - 87,394
Common stock issued for consulting svcs. - 8,004 110,480
Provision for Compensation - consulting
stock options.......................... - - 85,000
Assignment of intellectual property
used in research and development........... - - 200,000
Changes in operating assets and
liabilities:................................
Accounts receivable........................ 70,030 - (4,112)
Prepaid expenses and other assets.......... 51,061 99,729 (181,354)
Accounts payable........................... (97,083) 563,995 739,866
Accrued expenses and other liabilities..... (40,062) 86,862 179,925
Deferred revenue........................... 7,422 - 354,310
----------- ----------- -----------
Net cash used in operating activities......... (2,232,639) (189,405) (14,709,100)
INVESTING ACTIVITIES
Purchase of available-for-sale securities.. - - (4,517,181)
Proceeds from available-for-sale
securities ................................ - - 4,416,283
Purchase of equipment and leasehold
improvements, net...................... (283,456) (2,842,900) (4,131,557)
Expenditures for patents.................... (48,583) (99,047) (1,696,941)
------------ ------------ -----------
Net cash used in investing activities......... (332,039) (2,941,947) (5,929,396)
FINANCING ACTIVITIES
Proceeds from issuance of debt.............. - 2,000,000 2,000,000
Proceeds from issuance of stock............. - - 21,711,736
Principal pymts. of capital lease (4,550) (1,155) (85,599)
obligations............................
Advances from shareholder................... - - 330,000
Payments to shareholder..................... - - (330,000)
Other....................................... (14,719) 54,175 (649,483)
----------- ----------- -----------
Net cash provided by (used in)
financing activities.................... (19,269) 2,053,020 22,976,654
----------- ----------- -----------
Net increase (decrease) in
cash and cash equivalents............... (2,583,947) (1,078,332) 2,338,158
Cash and cash equivalents
at beginning of period.................. 8,688,162 3,416,490 -
----------- ----------- -----------
Cash and cash equivalents
at end of period........................ $6,104,215 $ 2,338,158 $ 2,338,158
=========== =========== ===========
Supplemental disclosure of cash flows info.
Cash paid for interest................... $ 1,395 $ 28,613
Supplemental disclosure of non-cash transact.
Interest capitalized in equipment and
leasehold improvements $ - $ 92,603
</TABLE>
See accompanying notes to condensed financial statements.
Note A; Period from Inception (November 11, 1989) to Date, March 31, 2000
5
<PAGE> 6
OPHIDIAN PHARMACEUTICALS, INC.
(A DEVELOPMENT STAGE CORPORATION)
NOTES TO CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES
The accompanying financial statements have been prepared in accordance with
generally accepted accounting principles for interim financial information and
in accordance with the instructions to Form 10-Q and Article 10 of Regulation
S-X. Accordingly, they do not include all of the information and notes required
by generally accepted accounting principles for complete financial statements
and should be read in conjunction with the Ophidian Pharmaceuticals, Inc.'s
("Company's") annual report filed on Form 10-K, containing audited financial
statements for the fiscal year ended September 30, 1999. In the opinion of
management, all adjustments (consisting only of adjustments of a normal and
recurring nature) considered necessary for a fair presentation of the results of
operations have been included. Operating results for any interim periods are not
necessarily indicative of the results that might be expected for the full year.
NOTE 2. SALE OF INTELLECTUAL PROPERTY
An 8-K was filed on March 28, 2000, disclosing the sale of five patents and
patent applications from the Company's portfolio of over 90 issued or pending
patents for $1.3 million. The patents sold are unrelated to the Company's core
development programs.
NOTE 3. NET EARNINGS (LOSS) PER SHARE
The numerator for the calculation of basic and diluted earnings per share is net
income (loss) in each period. The following table sets forth the computation of
basic and diluted weighted average shares used in the per share calculations:
<TABLE>
<CAPTION>
Three months ended March 31, Six months ended March 31,
1999 2000 1999 2000
---- ---- ---- ----
<S> <C> <C> <C> <C>
Denominator for basic earnings (loss)
per share - weighted average shares
outstanding 1,154,127 1,155,796 1,154,127 1,155,636
Effect of dilutive options and warrants - 77,584 - -
--------------------- --------------------- -------------------- ---------------------
Denominator for diluted earnings (loss)
per share 1,154,127 1,233,380 1,154,127 1,155,636
===================== ===================== ==================== =====================
Options and warrants that could
potentially dilute earnings per
share in the future that are not
included in the computation of
diluted loss per share as their
impact is antidilutive
31,246 N/A 31,246 77,584
</TABLE>
6
<PAGE> 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following discussion of the financial condition and results of operations of
the Company should be read in conjunction with the financial statements and the
related notes thereto included in this document. This document contains certain
forward-looking statements that involve risks and uncertainties. These
forward-looking statements are made in reliance upon the safe harbor provisions
of the Private Securities Litigation Reform Act of 1995. The Company cautions
readers that the Company's actual results may differ significantly from the
results anticipated in these forward-looking statements as a result of various
factors. Such factors include, but are not limited to, those in the section
titled "Risk Factors" (pages 7-18) of the Company's Prospectus, which is part of
the Company's Registration Statement, filed on Form S-1, as amended, effective
May 7, 1998, and summarized in its Annual Report for Fiscal 1999, filed on Form
10-K, effective December 29, 1999. The Company undertakes no obligation to
revise such forward-looking statements to reflect events or circumstances
occurring after the date hereof.
OVERVIEW
Ophidian is a development stage corporation focused on the research, development
and commercialization of therapeutic products for human and animal use. The
Company's business has been directed to numerous areas of disease but has
focused principally on products for infectious disease prevention and treatment.
The Company has not received any revenues from the sale of Food and Drug
Administration ("FDA") licensed products to date and does not expect to receive
any such revenues during the next two fiscal years. Except for the fiscal year
ended September 30, 1993, the Company has been unprofitable every year since
inception. The Company expects to incur additional losses over the next several
years. At March 31, 2000, the Company had an accumulated deficit of $17,447,704
and for the three months ended March 31, 2000, incurred a net profit of
$391,573. THE COMPANY'S CURRENT CASH POSITION IS NOT SUFFICIENT TO CONTINUE
OPERATIONS FOR ANOTHER YEAR. THE COMPANY'S AUDITORS EXPRESSED A GOING CONCERN
OPINION FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 1999. IF THE COMPANY'S EFFORTS
TO RAISE FUNDS COMMERCIALLY ARE NOT SUCCESSFUL WITHIN THE CURRENT QUARTER,
ADDITIONAL EQUITY WILL IN ALL LIKELIHOOD HAVE TO BE SOLD, WHICH, IF SUCCESSFUL,
MAY RESULT IN SIGNIFICANT SHAREHOLDER EQUITY DILUTION.
The Company intends to continue investing in the further research and
development of its technologies and products in infectious disease and other
therapeutic areas, specifically including inflammatory bowel disease ("IBD").
Depending on a variety of factors, including collaborative arrangements,
availability of personnel and financial resources, the Company will engage in
the development of its products and establish capabilities to support regulatory
submissions. The Company will need to make additional capital investments in
research and development laboratories and manufacturing facilities, including
the construction of facilities for large-scale production of avian antibodies
and supporting testing laboratories. Investments in manufacturing and associated
capabilities would be required to be made before any regulatory agency would
grant approval to market products, however, there can be no assurance that such
approval will be granted. The Company believes its current facility can
ultimately be used for a product launch but that it would not be adequate over
the intermediate to long term. It is expected that the Company will need to hire
additional personnel to support increased research and development,
manufacturing, quality systems, and general business requirements.
RESULTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 2000, COMPARED TO THREE MONTHS ENDED MARCH 31, 1999
Revenues. Revenues were $1,300,000 for the three months ended March 31, 2000, as
compared to $5,915 for the three months ended March 31, 1999 an increase of
$1,294,085 due to the proceeds from the sale of 5 patents and patent
applications.
Costs of Patents Sold. This represents, for the patents sold in the period, the
capitalized costs remaining on the balance sheet and are primarily legal costs
associated with the patents. Research and development costs are expensed as
incurred.
7
<PAGE> 8
Research and Development Expense. Research and development expenses decreased
$182,933 to $641,738 for the three months ended March 31, 2000, as compared to
$824,671 for the three months ended March 31, 1999. The decrease in expenses in
the three months ended March 31, 2000, resulted primarily from a reduction in
personnel expenses and costs associated with the clinical development of the
CLOSTRIDIUM DIFFICILE-Associated Disease ("CDAD") therapeutic antitoxin known as
OPHD001 as well as by a decline in expenses related to the development of
certain technologies (transforming growth factor beta ["TGF-beta"]. The Company
is seeking partners to help develop the inflammatory bowl disease ["IBD"] and
TGF-beta technologies externally.
General and Administrative Expenses. General and administrative expenses
decreased $93,730 to $306,731 for the three months ended March 31, 2000, as
compared to $400,461 for the three months ended March 31, 1999. The decrease in
expenses in the three months ended March 31, 2000, resulted primarily from
decreased salary expenses and other expenses to support business development and
financial functions. In addition, certain expenses related to the design,
engineering and construction of the new manufacturing facility were performed by
the Company and were capitalized (approximately $70,000).
Interest Income and Expenses. Interest income decreased $31,177 to $60,684 for
the three months ended March 31, 2000, as compared to $91,861 for the three
months ended March 31, 1999. The decrease in interest income in the three months
ended March 31, 2000, resulted from lower average cash balances offset in part
by higher average interest rates. Year to date interest of $92,603 on the senior
notes which were used to finance construction of the Company's first
manufacturing facility was capitalized.
Net Income (Loss). There was $391,573 of net income for the three months ended
March 31, 2000, as compared to a loss of $(1,128,561) for the three months ended
March 31, 1999. The favorable change of $1,520,134 for the three months ended
March 31, 2000, resulted primarily from the sale of the 5 patents and patent
applications as well as from capitalized costs related to the new manufacturing
facility and lower research and development and general and administrative
expenses.
Net Operating Loss. The Company did not generate net operating loss
carry-forwards for federal and state income tax purposes for the three months
ended March 31, 2000, although it expects to generate a net operating loss in
fiscal 2000. The Company has recorded an adjustment to reduce its deferred tax
asset and valuation allowance for the period ended March 31, 2000 resulting in
no impact to the results of operations.
SIX MONTHS ENDED MARCH 31, 2000, COMPARED TO SIX MONTHS ENDED MARCH 31, 1999
Revenues. Revenues increased $1,293,395 to $1,300,000 for the six months ended
March 31, 2000, as compared to $6,605 for the six months ended March 31, 1999.
Revenues in the six months ended March 31, 2000, were greater due to the net
proceeds from the sale of 5 patents and patent applications.
Costs of Patents Sold. This represents, for the patents sold in the second
quarter, the capitalized costs remaining on the balance sheet and are primarily
legal costs associated with the patents. Research and development costs are
expensed as incurred.
Research and Development Expenses. Research and development expenses increased
$922 to $1,682,533 for the six months ended March 31, 2000, as compared to
$1,681,611 for the six months ended March 31, 1999. The increase in expenses in
the six months ended March 31, 2000 was negligible. This was a result primarily
of higher costs in the current fiscal year associated with preclinical
development of IBD and clinical development of the CDAD therapeutic antitoxin
being offset in the main by a decline in expenses in fiscal 2000 related to the
TGF-beta program and lower personnel expenses.
General and Administrative Expenses. General and administrative expenses
decreased $149,713 to $716,638 for the six months ended March 31, 2000, as
compared to $866,351 for the six months ended March 31, 1999. The decrease in
expenses in the six months ended March 31, 2000 resulted primarily from
decreased salary expenses and other expenses to support business development and
financial functions and certain expenses related to the design, engineering and
construction of the new manufacturing facility being performed by the Company
and capitalized (approximately $70,000).
8
<PAGE> 9
Interest Income and Expenses. Interest income decreased $70,077 to $76,139 for
the six months ended March 31, 2000, as compared to $146,216 for the six months
ended March 31, 1999. The decrease in interest income in the six months ended
March 31, 2000, resulted from lower average cash balances offset in part by
higher average interest rates during the six months ended March 31, 2000.
Interest expense increased $27,218 to $28,613 for the six months ended March 31,
2000, as compared to $1,395 for the six months ended March 31, 1999. The
increase reflects interest on a sales & use tax assessment as a result of audit.
The Company is seeking relief for taxes and related interest charges it believes
were inappropriately assessed.
Net Operating Loss. The company generated net operating loss carry-forwards for
federal and state income tax purposes for the six months ended March 31, 2000.
The Company has recorded a valuation allowance to reserve for net deferred tax
assets.
LIQUIDITY AND CAPITAL RESOURCES
The Company has financed its operations since inception primarily through equity
and debt financing and revenues consisting of payments received under
collaborative agreements, federal research grants and patent sales. As of March
31, 2000, the Company had received $21,711,736 in net cash proceeds from the
sale of equity. The Company's principal equity financing have occurred through
its Initial Public Offering ("IPO"), and stock sold in private placements and to
Eli Lilly & Co. In October 1999, $2,000,000 was secured by the sale of senior
notes in connection with financing the new manufacturing facility.
Net cash used in operating activities was $189,405 for the six months ended
March 31, 2000, as compared with net cash used in operating activities of
$2,232,639 for the six months ended March 31, 1999. The decrease in cash used in
operating activities is primarily attributable to the net proceeds from the sale
of 5 patents and patent applications in March 2000, capitalization of expenses
related to the design, engineering and construction of the new plant and
increases in accounts payable and accrued expenses and decreased general and
administrative expenses offset in part by lower interest income. Net cash used
in investing activities was $2,941,947 for the six months ended March 31, 2000,
as compared to $332,039 for the equivalent period one year earlier. The increase
is principally attributable to construction of the Company's first manufacturing
facility. Net cash provided in financing activities was $2,053,020 for the six
months ended March 31, 2000, as compared with cash used by financing activities
of $19,269 for the equivalent period one year earlier. The change is primarily
attributable to the issuance of debt and the use of cash deposits which
accompanied equipment orders in earlier periods.
The Company believes that its existing capital resources (cash and short-term
investments of $2,338,158 as of March 31, 2000) and interest income will be
sufficient to satisfy its funding requirements FOR NO MORE THAN 5 TO 6 MONTHS
following the date of this document (March 31, 2000). For this period, these
requirements include partial completion of the Phase II clinical trial for
OPHD-001 where enrollment continues slower than anticipated and completion of
the small scale pilot facilities in Madison, WI. The Company has taken steps to
increase enrollment in the OPHD-001 clinical trials and any success WILL MORE
RAPIDLY DEPLETE CASH RESOURCES.
Furthermore, the Company anticipates that the following material changes could
occur in the next twelve months. The Company is actively seeking partnerships
with other commercial entities to gain access to operating capital, product
development capabilities and marketing resources. There can be no assurance that
the Company will be successful in establishing such partnerships. Progress in
partner discussions and /or the availability of additional capital may affect
decisions by the Company on the amount and timing of funds allocated to future
product development. Accordingly, the timing of future development milestones
may be impacted by these events. The Company anticipates that its expenses
incurred in manufacturing will increase and contribute to future increases in
net operating losses in the near term. AT PRESENT MARKET VALUATIONS FOR THE
COMPANY'S SECURITIES, A LARGE DILUTION OF EXISTING SHAREHOLDER EQUITY IS
POSSIBLE IF THE COMPANY HAS TO SELL ADDITIONAL EQUITY ASSUMING SUCH A SALE IS
POSSIBLE.
9
<PAGE> 10
NET OPERATING LOSSES
The Company has not generated taxable income to date. At March 31, 2000, the net
operating losses available to offset future taxable income for federal income
tax purposes were approximately $17,300,000. These carry-forwards expire
beginning in 2007 if not utilized. At March 31, 2000, the Company has research
and other federal tax credit carry-forwards of approximately $935,000 and
Wisconsin carry-forwards of approximately $350,000. The Company has recorded a
full valuation allowance against any deferred tax assets established for the
carry-forwards.
Utilization of the net operating losses and credits may be subject to annual
limitations due to the ownership change limitations provided by the Internal
Revenue Code and similar state provisions. The annual limitations may result in
the expiration of net operating losses and credits before utilization.
STOCK PERFORMANCE TABLE
The following table compares the percentage change in cumulative total
stockholder return on the Company's Common Stock with the cumulative return on
the NASDAQ (Composite) Stock Market (Broad Market) and the NASDAQ Biotechnology
Stock (Peer) during the period beginning June 12, 1998, (the date on which the
Company's Common Stock began trading separately from the warrants on the NASDAQ
SmallCap System) through March 31, 2000. The comparison assumes $100 was
invested on June 12, 1998, in the Company's Common Stock and in the foregoing
indices and assumes the reinvestment of dividends.
<TABLE>
<CAPTION>
STOCK PERFORMANCE TABLE
12-Jun-98 30-Sep-98 30-Sep-99 31-Dec-99 31-Mar-00
<S> <C> <C> <C> <C> <C>
OPHIDIAN 100.0 44.6 15.7 7.8 17.2
NASDAQ STOCK MARKET INDEX 100.0 97.1 157.4 233.2 262.0
NASDAQ BIO-TECH STOCK INDEX 100.0 101.5 187.9 281.0 349.4
</TABLE>
The Company's securities were first listed on May 7, 1998, the date of the
Company's IPO. The securities first traded as Units consisting of one share of
Common Stock and one Common Stock Purchase Warrant. Effective on June 12, 1998,
the Company and its Underwriters agreed to separate the Units into their
individual components. The ranges of high and low bid quotations on a quarterly
basis from May 7, 1998, as supplied by NASDAQ(1) are as follows:
10
<PAGE> 11
<TABLE>
<CAPTION>
QUARTER UNITS COMMON STOCK WARRANTS
------- ----- ------------ --------
High Bid Low Bid High Bid Low Bid High Bid Low Bid
-------- ------- -------- ------- -------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
04/01/98 06/30/98 $6.6250 $4.8750 $38.000 $26.000 $1.8750 $1.0000
07/01/98 09/30/98 N/A N/A $30.500 $8.000 $1.5000 $0.2500
10/01/98 12/31/98 N/A N/A $24.500 $6.000 $0.6250 $0.1875
01/01/99 03/31/99 N/A N/A $14.000 $6.500 $0.3750 $0.1250
04/01/99 06/30/99 N/A N/A $14.000 $5.000 $0.2500 $0.1250
07/01/99 09/30/99 N/A N/A $9.000 $1.000 $0.6250 $0.0625
10/01/99 12/31/99 N/A N/A $6.438 $2.500 $0.2500 $0.0313
01/01/00 03/31/00 N/A N/A $20.000 $3.000 $0.6250 $0.0938
</TABLE>
(1) Prices are interdealer quotations, without retail markups, markdowns
or commissions, and may not represent actual transactions.
PART II - OTHER INFORMATION
ITEM 1. Legal Proceedings - None
ITEM 2. Changes in Securities and Use of Proceeds
(a) None
(b) None
(c) None
(d) Use of Proceeds
The information in this paragraph 2(d) relates to the
Registrant's Registration Statement on Form S-1, as amended,
effective May 7, 1998, Registration No. 333-33219 (the
Registration Statement). The managing underwriters for the
offering of the securities sold pursuant to the Registration
Statement (the Offering) were Dirks & Company, Inc. and
Security Capital Trading, Inc. (the Underwriters). The
Offering commenced on May 7, 1998, and was completed on June
23, 1998, following the Underwriters' exercise of their
options to purchase additional units to cover over allotments
(the Over-Allotment Option). The following chart sets forth
the securities registered pursuant to the Offering, the
offering price, the amount sold, and the aggregate-offering
price of the amount sold.
<TABLE>
<CAPTION>
AMOUNT OFFERING AGGREGATE
SECURITY REGISTERED PRICE AMOUNT SOLD OFFERING PRICE OF
-------- ---------- PER UNIT ----------- AMOUNT SOLD
-------- -----------
<S> <C> <C> <C> <C>
Unit consisting of one 2,012,500(1) $ 6.10 1,933,088(2) $11,791,855
share of Common Stock,
par value $.0025 per
share (Common Stock) and
one redeemable Common
Stock Purchase Warrant
(Warrant)
</TABLE>
(1) Includes 262,500 additional Units registered pursuant to
the Over-Allotment Option granted to the Underwriters.
Excludes (i) additional shares of Common Stock issuable
upon exercise of the Warrants, (ii) additional shares of
Common Stock issuable upon exercise of certain
Representatives' Warrants, as defined in the Registration
Statement, and (iii) additional shares of Common Stock
issuable upon exercise of Warrants issuable upon exercise
of the Representatives' Warrant.
11
<PAGE> 12
(2) Includes 183,088 additional Units purchased by the
Underwriters on June 23, 1998, when they partially
exercised their Over-Allotment Option by purchasing 183,088
Units of the 262,500 Units originally granted in the
option.
<TABLE>
<S> <C>
Total underwriting discounts and commissions: $1,061,265
Other expenses: 1,373,365
---------
Total expenses: $2,434,630
All such expenses were direct or indirect payments to
others.
</TABLE>
The net offering proceeds to the Company, after deducting the
total expenses above, were $9,357,225. The Company expects to
use the net proceeds in direct or indirect payments to others
as follows:
<TABLE>
<CAPTION>
OFFERING
MEMORANDUM REVISED REVISED
DESCRIPTION OF USE OF PROCEEDS(1) MAY 1998 SEPT. 1998 JUN. 1999
------------------------------- ---------- ---------- ---------
<S> <C> <C> <C>
Construction of plant, building and facilities $1,100,000 - $557,000
Purchase & installation of machinery & equipment 1,750,000 $1,900,000 1,300,000
Purchase of real estate - - -
Acquisition of other business(es) - - -
Repayment of indebtedness - - -
Research & development & business operations 5,500,000 7,300,000(2) 7,500,000(2)
Working capital 1,007,000 157,000 -
Temporary investments - - -
</TABLE>
ITEM 3. Defaults upon Senior Securities - None
ITEM 4. Submission of Matters to a vote of Security Holders - None
ITEM 5. Other Information - None
ITEM 6. Exhibits and Reports on Form 8-K
(a) Exhibits (see exhibit list)
(3) Reports on Form 8-K - Date of Report: March 28, 2000
(1) Each of the following amounts is a reasonable estimate based on the
Company's focus on development of the CDAD product. This use of the proceeds
does not represent a material change in CDAD development focus described in
the Prospectus of the Registration Statement.
(2) This figure includes expenditures for the initial Phase II clinical testing
of the CDAD product.
12
<PAGE> 13
ITEM 6(a). EXHIBIT LIST
Number Description
- --------------------------------------------------------------------------------
3.1 Certificate of Incorporation of the Registrant, filed as
Exhibit C to the Company's Proxy Statement filed on February
23, 1999 (the "Proxy Statement"), and hereby incorporated by
reference.
3.2 Bylaws of the Registrant, filed as Exhibit D to the Proxy
Statement, and hereby incorporated by reference.
3.3 Certificate of Amendment of Certificate of Incorporation of the
Registrant, filed as Exhibit A to the Company's Proxy Statement
filed on June 29, 1999, and hereby incorporated by reference.
4.1 Specimen Common Stock Certificate, filed as Exhibit 4.1 to the
Registration Statement, and hereby incorporated by reference.
4.2 Specimen Warrant Certificate, filed as Exhibit 4.2 to the
Registration Statement, and hereby incorporated by reference.
4.3 Form of Representatives' Warrant Agreement, including Specimen
Representatives' Warrant, filed as Exhibit 4.3, to the
Registration Statement, and hereby incorporated by reference.
4.4 Form of Warrant Agreement, filed as Exhibit 4.4, to the
Registration Statement and hereby incorporated by reference.
4.5 Specimen Unit Certificate, filed as Exhibit 4.5 to the
Registration Statement, and hereby incorporated by reference.
4.6 Specimen Warrant Certificate, filed as part of Exhibit 10.2 to
the Company's Form10-Q for the period ended June 30, 1999, and
hereby incorporated by reference.
10.1 Lease dated February 12, 1994, between the Company and Promega
Corporation, filed as Exhibit 10.1 to the Registration
Statement, and hereby incorporated by reference.
10.2 1998 Incentive Stock Option Plan, filed as Exhibit A to the
Proxy Statement, and hereby incorporated by reference.
10.3 1990 Incentive Stock Option Plan, filed as Exhibit 10.3 to the
Registration Statement, and hereby incorporated by reference.
10.4 1992 Employee Stock Option Plan, filed as Exhibit 10.4 to the
Registration Statement, and hereby incorporated by reference.
10.5 Agreement dated June 3, 1996, between the Company and Eli Lilly
and Company filed as Exhibit 10.5 to the Registration Statement
and hereby incorporated by reference.
10.6 Employment Agreement dated June 1, 1997, between the Company
and Douglas C. Stafford, filed as Exhibit 10.6 to the
Registration Statement, and hereby incorporated by reference.
10.7 Employment Agreement dated June 1, 1997, between the Company
and Joseph Firca, filed as Exhibit 10.7 to the Registration
Statement, and hereby incorporated by reference.
10.8 Employment Agreement dated November 6, 1997, between the
Company and Donald L. Nevins, filed as Exhibit 10.9 to the
Registration Statement, and hereby incorporated by reference.
10.9 Employment Agreements dated December 1, 1998, between the
Company and F. Michael Hoffmann, filed as Exhibit 10.10 to the
Company's Form 10-K for the period ended September 30, 1998,
and hereby incorporated by reference.
10.10 Lease for 2617 Progress Road, Madison, WI, dated June 9, 1999,
between the Company and Progress Holdings, LLC, filed as
Exhibit 10.11 to the Company's Form 10-Q for the period ended
June 30, 1999, and hereby incorporated by reference.
10.11 Form of Promissory Note and Loan Agreement, dated June 7, 1999,
among the Company, Rex J. Bates and Davis U. Merwin, filed as
Exhibit 10.12 to the Company's Form 10-Q for the period ended
June 30, 1999, and hereby incorporated by reference.
27.0 Financial Data Schedule.
13
<PAGE> 14
SIGNATURES
Pursuant to the requirement of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Ophidian Pharmaceuticals, Inc.
------------------------------
(Registrant)
May 12, 2000 By: /s/ Douglas C. Stafford
--------------------------------------
Douglas C. Stafford
President and Chief Executive Officer
May 12, 2000 By: /s/ Donald L. Nevins
--------------------------------------
Donald L. Nevins
Chief Financial Officer
May 12, 2000 By: /s/ Susan Maynard
--------------------------------------
Susan Maynard
Secretary
14
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C> <C>
<PERIOD-TYPE> 6-MOS 6-MOS
<FISCAL-YEAR-END> SEP-30-1999 SEP-30-1998
<PERIOD-END> MAR-31-2000 MAR-31-1999
<CASH> 2,338,158 6,104,215
<SECURITIES> 0 0
<RECEIVABLES> 4,112 11,536
<ALLOWANCES> 0 0
<INVENTORY> 0 0
<CURRENT-ASSETS> 2,394,826 6,194,736
<PP&E> 4,893,015 1,869,275
<DEPRECIATION> 1,035,101 707,076
<TOTAL-ASSETS> 7,963,201 8,823,309
<CURRENT-LIABILITIES> 922,222 235,067
<BONDS> 0 0
0 0
0 0
<COMMON> 2,894 23,058
<OTHER-SE> 5,056,618 8,221,177
<TOTAL-LIABILITY-AND-EQUITY> 7,963,201 8,823,309
<SALES> 0 0
<TOTAL-REVENUES> 1,300,000 6,605
<CGS> 0 0
<TOTAL-COSTS> 0 0
<OTHER-EXPENSES> 0 0
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 28,613 1,395
<INCOME-PRETAX> 0 0
<INCOME-TAX> 0 0
<INCOME-CONTINUING> 0 0
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (1,135,126) (2,396,536)
<EPS-BASIC> (0.98) (2.08)
<EPS-DILUTED> 0 0
</TABLE>
