<PAGE>
As filed with the Securities and Exchange Commission on March 28, 2000
Registration Statement No. 333-_____
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------
FORM S-3
----------------------
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
---------------------
BIOTRANSPLANT INCORPORATED
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
----------------------
DELAWARE 04-3119555
(STATE OR OTHER JURISDICTION (I.R.S. EMPLOYER IDENTIFICATION NO.)
OF INCORPORATION OR ORGANIZATION)
----------------------
BUILDING 75, THIRD AVENUE
CHARLESTOWN NAVY YARD
CHARLESTOWN, MASSACHUSETTS 02129
(617) 241-5200
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL
EXECUTIVE OFFICES)
----------------------
ELLIOT LEBOWITZ
PRESIDENT AND CHIEF EXECUTIVE OFFICER
BIOTRANSPLANT INCORPORATED
BUILDING 75, THIRD AVENUE
CHARLESTOWN NAVY YARD
CHARLESTOWN, MASSACHUSETTS 02129
(617) 241-5200
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
COPY TO:
STEVEN D. SINGER, ESQ.
HALE AND DORR LLP
60 STATE STREET
BOSTON, MASSACHUSETTS 02109
(617) 526-6000
----------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC: AS SOON AS
PRACTICABLE AFTER THIS REGISTRATION STATEMENT BECOMES EFFECTIVE.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. |_|
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. |X|
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. |_| _______________
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering.
If delivery of the Prospectus is expected to be made pursuant to Rule
434, please check the following box. |_|
------------------------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ------------------------------------------------ ---------------- ---------------- ---------------- ------------------
Proposed Proposed
Maximum Maximum
Aggregate Aggregate
Title of Each Class of Securities to be Amount to be Price Per Offering Amount of
Registered Registered Share(1) Price(1) Registration Fee
- ------------------------------------------------ ---------------- ---------------- ---------------- ------------------
<S> <C> <C> <C> <C>
Common Stock, $0.01 par value per share 3,962,250 $12.00 $47,547,000 $12,553
Shares
- ------------------------------------------------ ---------------- ---------------- ---------------- ------------------
</TABLE>
(1) Estimated solely for purposes of calculating the registration fee
pursuant to Rule 457(c) under the Securities Act and based upon the average of
the high and low prices of our Common Stock on the Nasdaq National Market on
March 23, 2000.
-----------------------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
SHALL DETERMINE.
================================================================================
<PAGE>
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES OR ACCEPT AN OFFER TO BUY THESE SECURITIES UNTIL THE
REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS
EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES, AND WE ARE
NOT SOLICITING OFFERS TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR
SALE IS NOT PERMITTED.
PROSPECTUS (Subject to Completion)
Issued March 28, 2000
BIOTRANSPLANT INCORPORATED
3,962,250 SHARES OF COMMON STOCK
---------------
This prospectus relates to resales of common stock, and shares of
common stock underlying warrants, that we issued and sold to the selling
stockholders listed on page 15. We will not receive any of the proceeds from the
sale of the shares by the selling stockholders.
The selling stockholders, or their pledgees, donees, transferees or
other successors in interest, may offer the shares through public or private
transactions at prevailing market prices, at prices related to prevailing market
prices or at privately negotiated prices.
Our common stock is traded on the Nasdaq National Market under the
symbol "BTRN." On March 23, 2000, the last reported sale price of our common
stock on the Nasdaq National Market was $12.00 per share.
---------------
INVESTING IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. SEE "RISK
FACTORS" BEGINNING ON PAGE 2.
---------------
The Securities and Exchange Commission and state securities regulators
have not approved or disapproved these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
Our principal executive offices are located at Building 75, Third
Avenue, Charlestown Navy Yard, Charlestown, Massachusetts 02129 and our
telephone number is (617) 241-5200.
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The date of this prospectus is __________ , 2000
<PAGE>
TABLE OF CONTENTS
PAGE
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WHO WE ARE.................................................................. .1
RISK FACTORS................................................... ..............2
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS............... ............14
USE OF PROCEEDS.................................................. ...........15
SELLING STOCKHOLDERS.............................................. ..........15
PLAN OF DISTRIBUTION.........................................................17
LEGAL MATTERS...................................................... .........19
EXPERTS......................................................................19
WHERE YOU CAN FIND MORE INFORMATION..........................................19
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE..............................19
-----------------------------------
We have not authorized anyone to provide you with information different
from that contained or incorporated by reference in this prospectus. The selling
stockholders are offering to sell, and seeking offers to buy, shares of our
common stock only in jurisdictions where offers and sales are permitted. The
information contained in this prospectus is accurate only as of the date of this
prospectus, regardless of the time of delivery of this prospectus or of any sale
of the shares.
<PAGE>
WHO WE ARE
BioTransplant Incorporated is developing pharmaceutical products and
systems to enable the body's immune system to better tolerate the
transplantation of foreign cells, tissues and organs. We believe that this
technology, which we refer to as our ImmunoCognance-TM- technology, will have
the following benefits when compared to the technology which is currently used
in conjunction with transplantation:
- reduce or eliminate the need for lifelong immunosuppressive
therapy, which refers to the long-term administration of
potentially debilitating drugs to a patient after a
transplantation procedure in an effort to reduce the likelihood
that the patient's body will reject the transplanted cells,
tissue or organ,
- minimize infections and health complications which may result
from the transplantation of foreign cells, tissues and organs,
- reduce the cost of treating end-stage organ disease, and
- increase the supply of organs or cells available for
transplantation procedures.
Our lead product, MEDI-507, is currently in Phase II clinical trials
for the treatment of graft-versus-host disease, a frequent and often fatal
disease which is caused when donor cells in a bone marrow transplant attack the
tissues of the recipient. MEDI-507 is also being evaluated for other
indications, including autoimmune diseases. MEDI-507 is being developed in
collaboration with MedImmune, Inc.
Our AlloMune-TM- Systems are being designed to re-educate a patient's
immune system so that it does not reject transplanted cells, tissues and organs.
We are currently evaluating AlloMune Systems for blood cell cancers and
kidney transplantation.
We are designing our XenoMune-TM- System to increase the available
supply of organs for transplantation through the development of methods to
enable the transplantation of organs from miniature swine into humans. Our
XenoMune System is being developed in collaboration with Novartis AG.
We have corporate collaborations with MedImmune and Novartis AG, as
well as with a number of scientific collaborative partners, including
Massachusetts General Hospital. We hold United States and foreign patents
covering many of our fundamental technologies.
We were incorporated in Delaware in 1990. Our principal executive
offices are located at Building 75, Third Avenue, Charlestown Navy Yard,
Charlestown, Massachusetts 02129. Our telephone number is 617-241-5200.
ImmunoCognance-TM-, AlloMune-TM- and XenoMune-TM- are our trademarks.
This prospectus also contains trademarks and tradenames of others.
<PAGE>
RISK FACTORS
ANY INVESTMENT IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. YOU
SHOULD CONSIDER CAREFULLY THE FOLLOWING RISKS, TOGETHER WITH THE OTHER
INFORMATION CONTAINED IN THIS PROSPECTUS, BEFORE YOU DECIDE TO BUY SHARES OF OUR
COMMON STOCK. THE RISKS AND UNCERTAINTIES DESCRIBED BELOW ARE NOT THE ONLY ONES
AFFECTING OUR COMPANY. ADDITIONAL RISKS AND UNCERTAINTIES MAY ALSO ADVERSELY
AFFECT OUR BUSINESS AND OPERATIONS. IF ANY OF THE FOLLOWING RISKS ACTUALLY
OCCUR, OUR BUSINESS, RESULTS OF OPERATIONS AND FINANCIAL CONDITION WOULD LIKELY
SUFFER, POSSIBLY MATERIALLY. IN THESE CIRCUMSTANCES, THE MARKET PRICE OF OUR
COMMON STOCK COULD DECLINE, AND YOU MAY LOSE ALL OR PART OF THE MONEY YOU PAID
TO BUY OUR COMMON STOCK.
RISKS RELATED TO OUR BUSINESS, INDUSTRY AND STRATEGY
WE HAVE NOT SUCCESSFULLY DEVELOPED ANY PRODUCTS TO DATE AND IF WE DO
NOT SUCCESSFULLY COMMERCIALIZE ANY PRODUCTS WE WILL NOT BE PROFITABLE
To date, we have engaged primarily in research and development
activities. We have not yet completed the development of, conducted significant
clinical trials with respect to, or marketed any of our potential products. If
we are not successful in developing and commercializing any products then we
will never become profitable.
Neither we, nor any other company, has successfully developed and sold
the types of products we plan to develop using our technologies. The products
that we are developing will require additional research and development,
extensive preclinical studies and clinical trials and regulatory approval prior
to any commercial sales. In particular, we may need to successfully develop
multiple novel technologies in order to complete development of our AlloMune and
XenoMune Systems. Moreover, these products may not be effective in solving any
of our targeted disorders or may prove to have undesirable or unintended side
effects, toxicities or other characteristics that may prevent or limit
commercial use.
OUR IMMUNOCOGNANCE TECHNOLOGY IS COMPLEX AND NOVEL AND THERE ARE
UNCERTAINTIES AS TO THE EFFECTIVENESS OF THIS TECHNOLOGICAL APPROACH
Our ImmunoCognance technology is complex and novel. MEDI-507 has
been tested in relatively few patients and we may not be able to demonstrate
the clinical benefits of this product. Furthermore, our AlloMune and XenoMune
Systems are based upon technologies which, to our knowledge, have never been
implanted in humans, including by us. Our technological approaches may not
enable us to successfully develop and commercialize any products. Even if our
technological approaches are successful, we will need to undertake
substantial additional work to translate our discoveries into products.
Our XenoMune System is based upon the transplantation of organs from
miniature swine into humans. We have little precedent for this procedure and
previous attempts by others in the xenotransplantation, or inter-species
transplantation, field have not been successful. No xenotransplantation
approaches have been approved by the United States Food and Drug
Administration, or FDA, for humans.
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<PAGE>
WE ARE DEPENDENT ON MEDIMMUNE AND NOVARTIS AND OTHER COLLABORATIVE
PARTNERS TO DEVELOP, CONDUCT CLINICAL TRIALS, OBTAIN REGULATORY APPROVALS FOR,
AND MANUFACTURE, MARKET, AND SELL OUR PRINCIPAL PRODUCTS
We conduct most of our development activities, and plan to conduct most
of our commercialization activities, through collaborations. The success of
these collaborations is heavily dependent on the efforts and activities of our
collaborative partners. Our agreements with our collaborative partners allow
them significant discretion in determining the efforts and resources that they
will apply to the collaboration. Our existing and any future collaborations may
not be scientifically or commercially successful.
The risks that we face in connection with these collaborations include:
- Novartis is independently developing, and our other current and
any future partners may independently develop, products that may
be competitive with the products they are developing in
collaboration with us, which could affect their commitment to the
collaboration with us.
- Our existing collaborations are subject to termination without
cause and on short notice under certain circumstances. If our
collaborative partners terminate their collaborations with us, it
could make it difficult for us to attract new collaborative
partners or adversely affect the perception of us in the business
and financial communities.
- If MedImmune, Novartis or any of our other collaborative partners
were to breach or terminate an agreement with us, reduce its
funding or otherwise fail to conduct the collaboration
successfully, we could be required to devote additional internal
resources to the program that is the subject of the
collaboration, scale back or terminate the program or seek an
alternative partner.
- Our collaborative partners may pursue higher priority programs or
change the focus of their development programs, which could
affect the collaborative partners' commitment to us.
Pharmaceutical companies have historically re-evaluated their
development priorities following mergers and consolidations,
which have been common in recent years in these industries.
- After a product has been approved for marketing, any reductions
in marketing or sales efforts or a discontinuation of marketing
or sales of such product by our collaborative partners would
reduce our revenues, which will be based on a percentage of net
sales by the collaborative partner. For example, we are entitled
to receive royalties on MEDI-507, a product proprietary to
MedImmune. The amount of any royalties earned under this
arrangement is entirely dependent on the efforts of MedImmune to
develop and market MEDI-507.
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<PAGE>
THE PROGRESS OF OUR XENOMUNE SYSTEM DEVELOPMENT COULD BE DELAYED BY
DISRUPTIONS IN OUR SUPPLY OF MINIATURE SWINE
Our XenoMune System is based upon a herd of genetically engineered,
miniature swine. Although our miniature swine are located at several
different facilities, a disease epidemic or other catastrophe could destroy
all or a portion of the miniature swine herd, which would interrupt or
significantly delay the research, development and commercialization of any
XenoMune System product under development. In addition, Charles River
Laboratories is currently the only supplier of miniature swine and miniature
swine organs used in our XenoMune System research. In the event that Charles
River terminates or breaches its agreement with us, we may not have the
resources or capabilities to maintain the miniature swine herds ourselves.
WE FACE SUBSTANTIAL COMPETITION, WHICH MAY RESULT IN OTHERS
DISCOVERING, DEVELOPING OR COMMERCIALIZING PRODUCTS BEFORE OR MORE SUCCESSFULLY
THAN WE DO
The products being developed by us compete with existing and new
products being created by pharmaceutical, biopharmaceutical and biotechnology
companies, as well as universities and other research institutions. Many of our
competitors are substantially larger than we are and have substantially greater
capital resources, research and development staffs and facilities than we have.
Furthermore, many of our competitors are more experienced in product development
and commercialization, obtaining regulatory approvals and product manufacturing.
As a result, they may develop competing products more rapidly and at less cost.
In addition, our competitors may discover, develop and commercialize products
which render non-competitive or obsolete the products that we or our
collaborative partners are seeking to develop and commercialize.
THE MARKET MAY NOT BE RECEPTIVE TO OUR PRODUCTS UPON THEIR INTRODUCTION
The commercial success of our products that are approved for marketing
will depend upon their acceptance by the medical community and third party
payors as clinically useful, cost effective and safe. All of the products that
we are developing are based upon new technologies or therapeutic approaches. As
a result, it may be more difficult for us to achieve market acceptance of our
products.
Other factors that we believe will materially affect market acceptance
of our products and services include:
- The timing of receipt of marketing approvals and the countries in
which such approvals are obtained,
- the safety, efficacy and ease of administration of the product,
- the success of physician education programs, and
- the availability of government and third party payor
reimbursement of our products.
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<PAGE>
RISKS RELATING TO FINANCING
WE HAVE INCURRED SUBSTANTIAL LOSSES, WE EXPECT TO CONTINUE TO INCUR
LOSSES AND WE WILL NOT BE SUCCESSFUL UNTIL WE REVERSE THIS TREND
We have incurred losses in each year since our founding in 1990. We
expect to continue to incur operating losses for the foreseeable future.
To date, substantially all of our revenues have been generated from
payments from our collaborative partners such as Novartis and MedImmune. In
1999, all of our revenues other than interest income were from our collaboration
with Novartis. We have not received any revenues from the sale of products. We
anticipate that it will be a number of years, if ever, before we will receive
revenues from product sales or royalties.
We expect to increase our spending significantly as we continue to
expand our research and development programs and commercialization activities.
As a result, we will need to generate significant revenues in order to achieve
profitability. We cannot be certain whether or when this will occur because of
the significant uncertainties that affect our business.
WE MAY REQUIRE ADDITIONAL FINANCING, WHICH MAY BE DIFFICULT TO OBTAIN
AND MAY DILUTE YOUR OWNERSHIP INTEREST IN US
We will require substantial funds to conduct research and development,
including preclinical testing and clinical trials of our AlloMune and XenoMune
Systems, and to manufacture and market any products that are approved for
commercial sale. Our future capital requirements will depend on many factors,
including the following:
- continued progress in our research and development programs, as
well as the magnitude of these programs,
- the resources required to successfully complete our clinical
trials,
- the time and costs involved in obtaining regulatory approvals,
- the cost of manufacturing and commercialization activities,
- the cost of any additional facilities requirements,
- the timing, receipt, and amount of milestone and other payments
from collaborative partners,
- the timing, receipt, and amount of sales and royalties from our
potential products in the market, and
- the costs involved in preparing, filing, prosecuting,
maintaining, and enforcing patent claims and other patent-related
costs, including litigation costs and the costs of obtaining any
required licenses to technologies.
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<PAGE>
We may seek additional funding through collaborative arrangements and
public or private financings. Additional financing may not be available to us on
acceptable terms or at all.
If we raise additional funds by issuing equity securities, further
dilution to our then existing stockholders will result. In addition, the terms
of the financing may adversely affect the holdings or the rights of such
stockholders. If we are unable to obtain funding on a timely basis, we may be
required to significantly curtail one or more of our research or development
programs. We also could be required to seek funds through arrangements with
collaborative partners or others that may require us to relinquish rights to
certain of our technologies, product candidates, or products which we would
otherwise pursue on our own.
RISKS RELATING TO CLINICAL AND REGULATORY MATTERS
IF OUR CLINICAL TRIALS ARE NOT SUCCESSFUL, WE WILL NOT BE ABLE TO
DEVELOP AND COMMERCIALIZE ANY RELATED PRODUCTS
In order to obtain regulatory approvals for the commercial sale of our
future products, we and our collaborative partners will be required to complete
extensive clinical trials in humans to demonstrate the safety and efficacy of
the products. We have limited experience in conducting clinical trials.
The submission of an Investigational New Drug Application may not
result in FDA authorization to commence clinical trials. If clinical trials
begin, we or our collaborative partners may not complete testing successfully
within any specific time period, if at all, with respect to any of our
products. Furthermore, we, our collaborative partners, or the FDA, may
suspend clinical trials at any time on various grounds, including a finding
that the subjects or patients are being exposed to unacceptable health risks.
Clinical trials, if completed, may not show any potential product to be safe
or effective. Thus, the FDA and other regulatory authorities may not approve
any of our potential products for any indication.
The rate of completion of clinical trials is dependent in part upon the
rate of enrollment of patients. Patient enrollment is a function of many
factors, including the size of the patient population, the proximity of patients
to clinical sites, the eligibility criteria for the study, and the existence of
competitive clinical trials. In particular, the patient population for some of
our potential products is small. Delays in planned patient enrollment may result
in increased costs and program delays.
We are dependent upon MedImmune to conduct clinical trials with respect
to MEDI-507, Novartis to conduct clinical trials for the development of
xenotransplantation products, and we may become dependent upon other third
parties to conduct future clinical trials of our AlloMune and XenoMune Systems
and any other products. We will have less control over such clinical trials than
if we were conducting the trials directly. As a result, these trials may not
begin or be completed as we would have planned them.
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<PAGE>
WE MAY NOT OBTAIN REGULATORY APPROVALS; THE APPROVAL PROCESS IS COSTLY
AND LENGTHY
We must obtain regulatory approval for our ongoing development
activities and before marketing or selling any of our future products. We may
not receive regulatory approvals to conduct clinical trials of our products or
to manufacture or market our products. In addition, regulatory agencies may not
grant such approvals on a timely basis or may revoke previously granted
approvals.
The process of obtaining FDA and other required regulatory approvals
is lengthy and expensive. The time required for FDA and other clearances or
approvals is uncertain and typically takes a number of years, depending on
the complexity and novelty of the product. Our analysis of data obtained from
preclinical and clinical activities is subject to confirmation and
interpretation by regulatory authorities, which could delay, limit or prevent
regulatory approval. Any delay in obtaining or failure to obtain required
clearance or approvals could materially adversely affect our ability to
generate revenues from the affected product. We have only limited experience
in filing and prosecuting applications necessary to gain regulatory approvals.
There is limited regulatory precedent for the approval of products
based upon the technologies that we are employing to develop products. For
example, the FDA has not yet established definitive and comprehensive regulatory
guidelines for xenotransplantation. Because the AlloMune and XenoMune Systems
are based on new technologies and new therapeutic approaches that have not been
extensively tested in humans, the regulatory requirements governing these types
of products may be more rigorous than for conventional products. As a result, we
may experience a longer regulatory process in connection with any products that
we develop based on these new technologies or new therapeutic approaches. For
example, the FDA has not yet established final or comprehensive guidelines for
xenotransplantation.
We also are subject to numerous foreign regulatory requirements
governing the design and conduct of the clinical trials and the manufacturing
and marketing of our future products. The approval procedure varies among
countries. The time required to obtain foreign approvals often differs from that
required to obtain FDA approvals. Moreover, approval by the FDA does not ensure
approval by regulatory authorities in other countries.
All of the foregoing regulatory risks also are applicable to
development, manufacturing and marketing undertaken by our collaborative
partners or other third parties.
EVEN IF WE OBTAIN MARKETING APPROVAL, OUR PRODUCTS WILL BE SUBJECT TO
ONGOING REGULATORY REVIEW WHICH WILL BE EXPENSIVE AND MAY EFFECT OUR ABILITY TO
SUCCESSFULLY COMMERCIALIZE OUR PRODUCTS
Even if we receive regulatory approval of a product, such approval
may be subject to limitations on the indicated uses for which the product may
be marketed, which may limit the size of the market for the product or
contain requirements for costly post-marketing follow-up studies. With
respect to products for which we have obtained marketing approval, we, the
manufacturer of the product if other than us, and the
- 7 -
<PAGE>
manufacturing facilities will be subject to continual review and periodic
inspections by the FDA and other regulatory authorities. The subsequent
discovery of previously unknown problems with the product, such as the presence
of porcine endogenous retrovirus, also known as PERV, in porcine (swine) cells
or clinical trial subjects, or with the manufacturer or facility, may result in
restrictions on the product or manufacturer, including withdrawal of the product
from the market.
If we fail to comply with applicable regulatory requirements, we may be
subject to fines, suspension or withdrawal of regulatory approvals, product
recalls, seizure of products, operating restrictions, and criminal prosecution.
RISKS RELATING TO INTELLECTUAL PROPERTY
WE MAY NOT BE ABLE TO OBTAIN PATENT PROTECTION FOR OUR DISCOVERIES AND
WE MAY INFRINGE PATENT RIGHTS OF THIRD PARTIES
The patent positions of pharmaceutical and biotechnology companies,
including us, are generally uncertain and involve complex legal, scientific and
factual questions.
Our success depends in significant part on our ability to:
- obtain patents,
- protect trade secrets,
- operate without infringing upon the proprietary rights of others,
and
- prevent others from infringing on our proprietary rights.
Patents may not issue from any patent applications that we own or
license. If patents do issue, the claims allowed may not be sufficiently broad
to protect our technology. In addition, issued patents that we own or license
may be challenged, invalidated or circumvented. Our patents also may not afford
us protection against competitors with similar technology. Because patent
applications in the United States are maintained in secrecy until patents issue,
third parties may have filed or maintained patent applications for technology
used by us or covered by our pending patent applications without our being aware
of these applications.
We may not hold proprietary rights to certain patents related to our
proposed products. In some cases, these patents may be owned or controlled by
third parties. As a result, we or our collaborative partners may be required to
obtain licenses under third party patents to market certain of our proposed
products or services. If licenses are not available to us on acceptable terms,
we or our collaborative partners will not be able to market these products or
services.
WE MAY NOT BE ABLE TO KEEP OUR TRADE SECRETS CONFIDENTIAL
We also rely significantly upon unpatented proprietary technology,
information, processes and know how. For example, there are no patents and
only one patent application covering the miniature swine which are supplied
to us for use in our XenoMune System research. We seek to protect this
information by confidentiality agreements with our employees, consultants and
other
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<PAGE>
third party contractors as well as through other security measures. These
confidentiality agreements may be breached, and we may not have adequate
remedies for any such breach. In addition, our trade secrets may otherwise
become known or be independently developed by competitors.
WE MAY BECOME INVOLVED IN EXPENSIVE PATENT LITIGATION OR OTHER
INTELLECTUAL PROPERTY PROCEEDINGS WHICH COULD RESULT IN LIABILITY FOR DAMAGES OR
STOP OUR DEVELOPMENT AND COMMERCIALIZATION EFFORTS
There has been substantial litigation and other proceedings regarding
the complex patent and other intellectual property rights in the pharmaceutical
and biotechnology industries. We may become a party to patent litigation or
other proceedings regarding intellectual property rights.
Other types of situations in which we may become involved in patent
litigation or other intellectual property proceedings include:
- We may initiate litigation or other proceedings against third
parties to enforce our patent rights.
- We may initiate litigation or other proceedings against third
parties to seek to invalidate the patents held by such third
parties or to obtain a judgment that our products or services do
not infringe such third parties' patents.
- If our competitors file patent applications that claim technology
also claimed by us, we may participate in interference or
opposition proceedings to determine the priority of invention.
- If third parties initiate litigation claiming that our processes
or products infringe their patent or other intellectual property
rights, we will need to defend against such claims.
The cost to us of any patent litigation or other proceeding, even if
resolved in our favor, could be substantial. Some of our competitors may be able
to sustain the cost of such litigation or proceedings more effectively than we
can because of their substantially greater financial resources. If a patent
litigation or other intellectual property proceeding is resolved unfavorably to
us, we or our collaborative partners may be enjoined from manufacturing or
selling our products and services without a license from the other party and be
held liable for significant damages. We may not be able to obtain any required
license on commercially acceptable terms or at all.
Uncertainties resulting from the initiation and continuation of patent
litigation or other proceedings could have a material adverse effect on our
ability to compete in the marketplace. Patent litigation and other proceedings
may also absorb significant management time.
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<PAGE>
WE COULD LOSE IMPORTANT LICENSE RIGHTS IN CERTAIN CIRCUMSTANCES
We are a party to technology in-licenses that are important to our
business and expect to enter into additional licenses in the future. These
licenses impose various commercialization, sublicensing, royalty, insurance and
other obligations on us. If we fail to comply with these requirements, the
licensors will have the right to terminate these licenses.
RISKS RELATING TO PRODUCT MANUFACTURING, MARKETING AND SALES
WE HAVE NO SALES AND MARKETING EXPERIENCE AND CAPABILITIES
We have no sales, marketing and distribution experience and
capabilities. We plan to rely significantly on sales, marketing and distribution
arrangements with our collaborative partners and other third parties for the
products that we are developing. For example, we have granted to MedImmune
exclusive marketing rights to MEDI-507 and have granted to Novartis exclusive
worldwide marketing rights for our XenoMune System for certain technologies. The
terms of any future arrangements may not be favorable to us. In addition, we may
have limited or no control over the sales, marketing and distribution activities
of these third parties. Our future revenues will be materially dependent upon
the success of the efforts of these third parties.
If in the future we determine to perform sales, marketing and
distribution functions ourselves, we would face a number of additional risks,
including:
- we may not be able to attract and build a significant marketing
staff or sales force,
- the cost of establishing a marketing staff or sales force may not
be justifiable in light of any product revenues, and
- our direct sales and marketing efforts may not be successful.
WE HAVE LIMITED MANUFACTURING CAPABILITIES AND WILL BE DEPENDENT ON
THIRD PARTY MANUFACTURERS
We have limited manufacturing experience and no commercial or pilot
scale manufacturing capabilities. In order to continue to develop products,
apply for regulatory approvals and, ultimately, commercialize any products, we
will need to develop, contract for, or otherwise arrange for the necessary
manufacturing capabilities.
We currently rely upon third parties to produce material for
preclinical and clinical testing purposes and expect to continue to do so in
the future. We also expect to rely upon third parties, including our
collaborative partners, to produce materials required for the commercial
production of certain of our products if we succeed in obtaining necessary
regulatory approvals. There are a limited number of manufacturers that
operate under the FDA's regulations for good manufacturing practices which
are capable of manufacturing for us. If we are unable to arrange for third
party manufacturing of our products, or to do so on commercially reasonable
terms, we may not be able to complete development of our products or market
them.
- 10 -
<PAGE>
To the extent that we enter into manufacturing arrangements with third
parties, we are dependent upon these third parties to perform their obligations
in a timely manner. If such third party suppliers fail to perform their
obligations, we may be adversely affected in a number of ways, including:
- we may not be able to meet commercial demands for our products,
- we may not be able to initiate or continue clinical trials of
products that are under development, and
- we may be delayed in submitting applications for regulatory
approvals for our products.
We may in the future determine to manufacture certain of our products
in our own manufacturing facilities. We will require substantial additional
funds and need to recruit qualified personnel in order to build or lease and
operate any manufacturing facilities. We may not be able to successfully develop
our own manufacturing capabilities. Moreover, it may be very costly and time
consuming for us to develop such capabilities.
The manufacture of products by us and our collaborative partners and
suppliers is subject to regulation by the FDA and comparable agencies in foreign
countries. Delay in complying or failure to comply with such manufacturing
requirements could materially adversely affect the marketing of our products.
RISKS RELATED TO ONGOING OPERATIONS
IF WE FAIL TO OBTAIN AN ADEQUATE LEVEL OF REIMBURSEMENT FOR OUR FUTURE
PRODUCTS OR SERVICES BY THIRD PARTY PAYORS, THERE MAY BE NO COMMERCIALLY VIABLE
MARKETS FOR OUR PRODUCTS
The availability of reimbursement by governmental and other third party
payors affects the market for any pharmaceutical product. These third party
payors continually attempt to contain or reduce the costs of healthcare by
challenging the prices charged for medical products. In certain foreign
countries, particularly the countries of the European Union, the pricing of
prescription pharmaceuticals is subject to governmental control. We may not be
able to sell our products profitably if reimbursement is unavailable or limited
in scope or amount. Currently, no reimbursement plan exists for the costs
associated with our AlloMune and XenoMune Systems.
In both the United States and certain foreign jurisdictions, there have
been a number of legislative and regulatory proposals to change the healthcare
system. Further proposals are likely. The potential for adoption of these
proposals affects or will affect our ability to raise capital, obtain additional
collaborative partners and market our products.
If we or our collaborative partners obtain marketing approval for our
products, we expect to experience pricing pressure due to the trend toward
managed health care, the increasing influence of health maintenance
organizations and additional legislative proposals.
- 11 -
<PAGE>
WE COULD BE EXPOSED TO SIGNIFICANT LIABILITY CLAIMS IF WE ARE UNABLE TO
OBTAIN INSURANCE AT ACCEPTABLE COSTS OR OTHERWISE TO PROTECT US AGAINST
POTENTIAL PRODUCT LIABILITY CLAIMS
We may be subjected to product liability claims that are inherent in
the testing, manufacturing, marketing and sale of human health care products.
These claims could expose us to significant liabilities that could prevent or
interfere with the development or commercialization of our products. Product
liability claims could require us to spend significant time and money in
litigation or to pay significant damages. Product liability insurance is
generally expensive for biopharmaceutical companies such as ours. Although we
maintain limited product liability insurance coverage for the clinical trials
of our products, it is possible that we will not be able to obtain further
product liability insurance on acceptable terms, if at all, and that
insurance subsequently obtained will not provide adequate coverage against
all potential claims.
OUR GROWTH COULD BE LIMITED IF WE ARE UNABLE TO ATTRACT AND RETAIN KEY
PERSONNEL AND CONSULTANTS
Our success is substantially dependent on the ability, experience
and performance of our senior management and other key personnel and
consultants. If we lose one or more of the members of our senior management
or other key employees or consultants, our business and operating results
could be seriously harmed. None of the members of our senior management or
other key employees are bound by a long-term employment agreement with us.
With respect to the development of our XenoMune System, we depend in large
part on the efforts of Dr. David H. Sachs, chairman of our scientific
advisory board. We currently have a consulting contract with Dr. Sachs which
may be terminated by him at any time upon 30 days' written notice.
In addition, our future success will depend heavily on our ability to
continue to hire, train, retain and motivate additional skilled managerial and
scientific personnel. The pool of personnel with the skills that we require is
limited. Competition to hire from this limited pool is intense.
RISKS RELATING TO OUR COMMON STOCK
OUR STOCK PRICE COULD BE VOLATILE, WHICH COULD CAUSE YOU TO LOSE PART
OR ALL OF YOUR INVESTMENT
The market price of our common stock, like that of the common stock of
many other development stage biotechnology companies, may be highly volatile. In
addition, the stock market has experienced extreme price and volume
fluctuations. This volatility has significantly affected the market prices of
securities of many biotechnology and pharmaceutical companies for reasons
frequently unrelated to or disproportionate to the operating performance of the
specific companies. These broad market fluctuations may adversely affect the
market price of our common stock. Prices for our common stock will be determined
in the market place and may be influenced by many factors, including variations
in our financial results and investors' perceptions of us, as well as their
perceptions of general economic, industry and market conditions.
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<PAGE>
WE HAVE ANTITAKEOVER DEFENSES THAT COULD DELAY OR PREVENT AN
ACQUISITION AND COULD ADVERSELY AFFECT THE PRICE OF OUR COMMON STOCK
Provisions of our Certificate of Incorporation, our Bylaws, and
Delaware law may have the effect of deterring hostile takeovers or delaying or
preventing changes in control or our management, including transactions in which
our stockholders might otherwise receive a premium for their shares over then
current market prices. In addition, these provisions may limit the ability of
stockholders to approve transactions that they may deem to be in their best
interest. For example, our bylaws limit the manner in which stockholders may
call a special meeting. Our certificate of incorporation permits our board of
directors to issue preferred stock without shareholder approval. In addition to
delaying or preventing an acquisition, the issuance of a substantial number of
preferred shares could adversely effect the price of our common stock.
- 13 -
<PAGE>
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains forward-looking statements that involve
substantial risks and uncertainties. In some cases you can identify these
statements by forward-looking words such as "anticipate," "believe," "could,"
"estimate," "expect," "intend," "may," "should," "will," and "would" or similar
words. You should read statements that contain these words carefully because
they discuss future expectations, contain projections of future results of
operations or of financial position or state other "forward-looking"
information. The important factors listed above in the section captioned "Risk
Factors," as well as any cautionary language in this prospectus, provide
examples of risks, uncertainties and events that may cause our actual results to
differ materially from the expectations described in these forward-looking
statements. You should be aware that the occurrence of the events described in
these risk factors and elsewhere in this prospectus could have an adverse effect
on our business, results of operations and financial position.
Any forward-looking statements in this prospectus are not guarantees of
future performance, and actual results, developments and business decisions may
differ from those envisaged by such forward-looking statements, possibly
materially. We disclaim any duty to update any forward-looking statements, all
of which are expressly qualified by the statements in this section.
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<PAGE>
USE OF PROCEEDS
We will not receive any proceeds from the sale of the shares by the
selling stockholders.
The selling stockholders will pay any underwriting discounts and
commissions and expenses incurred by them for brokerage, accounting, tax,
legal services or other expenses incurred by the selling stockholders in
disposing of their shares. We will bear all other costs, fees and expenses
incurred in effecting the registration of the shares covered by this
prospectus, including, without limitation, all registration and filing fees,
Nasdaq National Market listing fees, fees and expenses of our counsel, fees
of our accountants, and blue sky fees and expenses.
SELLING STOCKHOLDERS
We issued 1,215,000 of the shares of common stock covered by this
prospectus in a private placement on February 11, 2000. The remaining
2,747,250 shares of common stock, including the 208,153 shares of common
stock underlying the warrants set forth below, were issued in private
placements at various dates prior to our initial public offering in May 1996.
Except as set forth below, none of the selling stockholders has held a
position or office with, or has otherwise had a material relationship with
us, within the past three years. The following table sets forth, to our
knowledge, certain information about the selling stockholders as of February
29, 2000. Beneficial ownership is calculated based on SEC requirements and is
not necessarily indicative of beneficial ownership for any other purpose.
Unless otherwise indicated below, each stockholder named in the table has
sole voting and investment power with respect to all shares beneficially
owned, subject to applicable community property laws. The percentage
calculated for each selling stockholder is based upon the sum of the "Common
Stock" and "Common Stock Issuable Upon Exercise of Warrants" columns.
We do not know when or in what amounts the selling stockholders may
offer shares for sale. The selling stockholders may not sell all or any of the
shares offered by this prospectus. Because the selling stockholder may offer all
or some of the shares pursuant to this offering, and because there are currently
no agreements, arrangements or understandings with respect to the sale of any of
the shares that will be held by the selling stockholders after completion of the
offering, we cannot estimate the number of the shares that will be held by the
selling stockholders after completion of the offering. However, for purposes of
this table, we have assumed that, after completion of the offering, none of the
shares covered by this prospectus will be held by the selling stockholders.
<TABLE>
<CAPTION>
Number of Shares of Common Stock Number of Shares of Common Stock
Beneficially Owned Prior to Offering Beneficially Owned After Offering
------------------------------------ ----------------------------------
Number Percent Number Percent
------------------------- --------- ------------------------- -------
Number of
Common Stock Shares of Common Stock
Name of Issuable Common Issuable
Selling Common Upon Exercise Stock to be Common Upon Exercise
Stockholders Stock of Warrants Sold Stock of Warrants
- --------------- ---------- ------------- ------------ -------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
B&C Investments 18,750 0 * 18,750 0 0 0
Samuel E. Bain 12,500 0 * 12,500 0 0 0
Clearwater Offshore
Fund Ltd 62,500 0 * 62,500 0 0 0
Abraham A. Galbut
as Trustee 75,000 0 * 75,000 0 0 0
Carl Goldfischer 10,000 0 * 10,000 0 0 0
Leonard J. Gross 13,000 0 * 13,000 0 0 0
HealthCare Ventures
II, L.P.(1) 1,492,009 78,877 13.5% 1,570,886 0 0 0
HealthCare Ventures
III, L.P.(1) 774,834 99,705 7.5% 874,539 0 0 0
HealthCare Ventures
IV, L.P.(1) 228,504 29,571 2.2% 258,075 0 0 0
Michael K. Hsu 10,000 0 * 10,000 0 0 0
Pamela Keld 30,000 0 * 30,000 0 0 0
Newcourt Ltd. 187,500 0 1.6% 187,500 0 0 0
Heesuck Michael Noh 45,970 0 * 37,500 8,470 0 *
Steven M. Oliveira 31,250 0 * 31,250 0 0 0
PHARMA/wHEALTH 190,000 0 1.6% 190,000 0 0 0
Ramco Enterprises 25,000 0 * 25,000 0 0 0
S.A.C Capital
Associates, LLC 375,000 0 * 375,000 0 0 0
Sands Point Partners 75,000 0 * 75,000 0 0 0
Nathan Shalom 22,000 0 * 12,000 10,000 0 *
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
Number of Shares of Common Stock Number of Shares of Common Stock
Beneficially Owned Prior to Offering Beneficially Owned After Offering
------------------------------------ ----------------------------------
Number Percent Number Percent
------------------------- --------- ------------------------- -------
Number of
Common Stock Shares of Common Stock
Name of Issuable Common Issuable
Selling Common Upon Exercise Stock to be Common Upon Exercise
Stockholders Stock of Warrants Sold Stock of Warrants
- --------------- ---------- ------------- ------------ -------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Joshua B. Stern 12,500 0 * 12,500 0 0 0
Trefoil/Garnet Capital
Partners, L.P. 488,741 0 4.2% 50,000 438,741 0 3.8%
Albert S. Waxman
Family Charitable
Remainder Unitrust 31,250 0 * 31,250 0 0 0
</TABLE>
- -------------------------
*Represents beneficial ownership of less than one percent of our common stock.
(1) William Crouse, a director of BioTransplant, is Vice Chairman of
HealthCare Ventures, LLC and a general partner of HealthCare
Partners II, L.P., HealthCare Partners III, L.P. and HealthCare
Partners IV, L.P., the general partners of HealthCare Ventures II, L.P.,
HealthCare Ventures III, L.P. and HealthCare Ventures IV, L.P.,
respectively.
- 16 -
<PAGE>
PLAN OF DISTRIBUTION
The shares covered by this prospectus may be offered and sold from time
to time by the selling stockholders. The term "selling stockholders" includes
pledgees, donees, transferees or other successors in interest selling shares
received after the date of this prospectus from the selling stockholders as a
pledge, gift or other non-sale related transfer. To the extent required, we may
amend and supplement this prospectus from time to time to describe a specific
plan of distribution.
The selling stockholders will act independently of BioTransplant in
making decisions with respect to the timing, manner and size of each sale. The
selling stockholders may make these sales at prices and under terms then
prevailing or at prices related to the then current market price. The selling
stockholders may also make sales in negotiated transactions, including pursuant
to one or more of the following methods:
- purchases by a broker-dealer as principal and resale by such
broker-dealer for its own account pursuant to this prospectus;
- ordinary brokerage transactions and transactions in which the
broker solicits purchasers;
- block trades in which the broker-dealer will attempt to sell the
shares as agent but may position and resell a portion of the
block as principal to facilitate the transaction;
- an over-the-counter distribution in accordance with the rules of
the Nasdaq National Market; and
- in privately negotiated transactions.
In connection with distributions of the shares or otherwise, the
selling stockholders may:
- enter into hedging transactions with broker-dealers or other
financial institutions, which may in turn engage in short sales
of the shares in the course of hedging the positions they assume;
- sell the shares short and redeliver the shares to close out such
short positions;
- enter into option or other transactions with broker-dealers or
other financial institutions which require the delivery to them
of shares offered by this prospectus, which they may in turn
resell; and
- pledge shares to a broker-dealer or other financial institution,
which, upon a default, they may in turn resell.
In addition, the selling stockholders may sell any shares that
qualify for sale pursuant to Rule 144 of the Securities Act of 1933, as
amended, under Rule 144 rather than pursuant to this prospectus.
- 17 -
<PAGE>
In effecting sales, broker-dealers or agents engaged by the selling
stockholders may arrange for other broker-dealers to participate. Broker-dealers
or agents may receive commissions, discounts or concessions from the selling
stockholders, in amounts to be negotiated immediately prior to the sale.
In offering the shares covered by this prospectus, the selling
stockholders, and any broker-dealers and any other participating broker-dealers
who execute sales for the selling stockholders may be deemed to be
"underwriters" within the meaning of the Securities Act in connection with these
sales. Any profits realized by the selling stockholders and the compensation of
such broker-dealer may be deemed to be underwriting discounts and commissions.
In order to comply with the securities laws of certain states, the
shares must be sold in those states only through registered or licensed brokers
or dealers. In addition, in certain states the shares may not be sold unless
they have been registered or qualified for sale in the applicable state or an
exemption from the registration or qualification requirement is available and is
complied with.
We have advised the selling stockholders that the anti-manipulation
rules of Regulation M under the Securities Exchange Act of 1934, as amended,
may apply to sales of shares in the market and to the activities of the
selling stockholders and their affiliates. In addition, we will make copies
of this prospectus available to the selling stockholders for the purpose of
satisfying the prospectus delivery requirements of the Securities Act. The
selling stockholders may indemnify any broker-dealer that participates in
transactions involving the sale of the shares against certain liabilities,
including liabilities arising under the Securities Act.
At the time a particular offer of shares is made, if required, we will
distribute a prospectus supplement that will set forth:
- the number of shares being offered;
- the terms of the offering, including the name of any underwriter,
dealer or agent;
- the purchase price paid by any underwriter;
- any discount, commission and other underwriter compensation;
- any discount, commission or concession allowed or reallowed or
paid to any dealer; and
- the proposed selling price to the public.
We have agreed to indemnify the selling stockholders against certain
liabilities, including certain liabilities under the Securities Act.
We have agreed with the selling stockholders to keep the
registration statement of which this prospectus constitutes a part effective
until the earlier of (i) such time as all of the shares covered by this
prospectus have been disposed of pursuant to the registration statement, (ii)
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<PAGE>
February 11, 2002 or (iii) such time as all of the shares covered by this
prospectus can be sold within any given three-month period without regard to the
trading volume of the common stock pursuant to Rule 144 of the Securities Act.
LEGAL MATTERS
The validity of the shares offered by this prospectus has been passed
upon by Hale and Dorr LLP.
EXPERTS
The financial statements and schedules included in our Annual Report
on Form 10-K for the year ended December 31, 1998, incorporated by reference
in this prospectus and elsewhere in the registration statement, have been
audited by Arthur Andersen LLP, independent public accountants, as indicated
in their reports with respect thereto, and are incorporated by reference
herein in reliance upon the authority of said firm in giving said reports.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly, and special reports, proxy statements, and
other information with the SEC. You can read our SEC filings, including the
registration statement, over the Internet at the SEC's web site at
HTTP://WWW.SEC.GOV. You may also read and copy any document we file with the SEC
at its public reference facilities at 450 Fifth Street, N.W., Washington, D.C.
20549. You may also obtain copies of the documents at prescribed rates by
writing to the Public Reference Section of the SEC at 450 Fifth Street, N.W.,
Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further
information on the operation of the public reference facilities.
This prospectus is part of a registration statement that we filed with
the SEC. The registration statement contains more information than this
prospectus regarding us and our common stock, including certain exhibits and
schedules. You can obtain a copy of the registration statement from the SEC at
the address listed above or from its Internet web site.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to "incorporate" into this prospectus information we
file with the SEC in other documents. This means that we can disclose important
information to you by referring to other documents that contain that
information. The information incorporated by reference is considered to be part
of this prospectus, and information that we file with the SEC in the future and
incorporate by reference will automatically update and may supersede the
information contained in this prospectus. We incorporate by reference the
documents listed below and any future filings we make with the SEC under
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the sale of all
the shares covered by this prospectus.
The following documents that we have filed with the SEC are
incorporated herein by reference:
- our Annual Report on Form 10-K for the year ended December 31,
1999;
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<PAGE>
- our Current Report on Form 8-K dated January 6, 2000;
- our Current Report on Form 8-K dated February 16, 2000;
- all of our filings pursuant to the Exchange Act after the date of
filing the initial registration statement and prior to
effectiveness of the registration statement; and
- the description of our common stock contained in our Registration
Statement on Form S-1, as amended (File No. 333-2144), including
any amendments or reports filed for the purpose of updating that
description.
You may request a copy of these documents, at no cost, by writing to:
BioTransplant Incorporated
Building 75, Third Avenue
Charlestown Navy Yard
Charlestown, Massachusetts 02129
Attention: Richard V. Capasso
Telephone: (617) 241-5200
- 20 -
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the various expenses to be incurred by
us in connection with the sale and distribution of the securities being
registered hereby, all of which will be borne by us (except any underwriting
discounts and commissions and expenses incurred by the selling stockholder for
brokerage, accounting, tax or legal services or any other expenses incurred by
the selling stockholder in disposing of the shares. All amounts shown are
estimates except the Securities and Exchange Commission registration fee.
SEC registration fee $12,553
Accounting fees and expenses 2,500
Legal fees and expenses 40,000
-------
Total expenses $55,053
=======
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article IX of our Restated Certificate of Incorporation provides that
no director of our company shall be personally liable for any monetary damages
for any breach of fiduciary duty as a director, except to the extent that the
Delaware General Corporation Law prohibits the elimination or limitation of
liability of directors for breach of fiduciary duty.
Article X of our Restated Certificate of Incorporation provides that a
director or officer of our company (a) shall be indemnified by us against all
expenses (including attorneys' fees), judgments, fines, and amounts paid in
settlement incurred in connection with any litigation or other legal proceeding
(other than an action by or in the right of our company) brought against him by
virtue of his position as a director or officer of our company if he acted in
good faith and in a manner he reasonably believed to be in, or not opposed to,
the best interests of our company, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful and (b)
shall be indemnified by us against all expenses (including attorneys' fees) and
amounts paid in settlement incurred in connection with any action by or in the
right of our company brought against him by virtue of his position as a director
or officer of our company if he acted in good faith and in a manner he
reasonably believed to be in, or not opposed to, the best interests of our
company, except that no indemnification shall be made with respect to any matter
as to which such person shall have been adjudged to be liable to us, unless a
court determines that, despite such adjudication but in view of all of the
circumstances, he is entitled to indemnification of such expenses.
Notwithstanding the foregoing, to the extent that a director or officer has been
successful, on the merits or otherwise, he will be indemnified by us against all
expenses (including attorneys' fees) incurred in connection therewith. Expenses
shall
II-1
<PAGE>
be advanced to a director or officer at his request, provided that he undertakes
to repay the amount advanced if it is ultimately determined that he is not
entitled to indemnification for such expenses.
Indemnification is required to be made unless we determine that the
applicable standard of conduct required for indemnification has not been met. In
the event of a determination by us that the director or officer did not meet the
applicable standard of conduct required for indemnification, or if we fail to
make an indemnification payment within 60 days after such payment is claimed by
such person, such person is permitted to petition the court to make an
independent determination as to whether such person is entitled to
indemnification. As a condition precedent to the right of indemnification, the
director or officer must give us notice of the action for which indemnity is
sought and we have the right to participate in such action or assume the defense
thereof.
Article X of our Restated Certificate of Incorporation further provides
that the indemnification provided therein is not exclusive, and provides that in
the event that the Delaware General Corporation Law is amended to expand the
indemnification permitted to directors or officers we must indemnify those
persons to the fullest extent permitted by such law as so amended.
Section 145 of the Delaware General Corporation Law provides that a
corporation has the power to indemnify a director, officer, employee, or agent
of the corporation and certain other persons serving at the request of the
corporation in related capacities against amounts paid and expenses incurred in
connection with an action or proceeding to which he is or is threatened to be
made a party by reason of such position, if such person shall have acted in good
faith and in a manner he reasonably believed to be in or not opposed to the best
interests of the corporation, and, in any criminal proceeding, if such person
had no reasonable cause to believe his conduct was unlawful; provided that, in
the case of actions brought by or in the right of the corporation, no
indemnification shall be made with respect to any matter as to which such person
shall have been adjudged to be liable to the corporation unless and only to the
extent that the adjudicating court determines that such indemnification is
proper under the circumstances.
We maintain a general liability insurance policy which covers certain
liabilities of directors and officers of our company arising out of claims based
on acts or omissions in their capacities as directors or officers.
ITEM 16. LIST OF EXHIBITS.
4.1(1) Restated Certificate of Incorporation of our company.
4.2(1) By-Laws, as amended to date, of our company.
4.3(2) Specimen stock certificate for shares of common stock of our company.
5 Opinion of Hale and Dorr LLP.
23.1 Consent of Hale and Dorr LLP, included in Exhibit 5 filed herewith.
II-2
<PAGE>
23.2 Consent of Arthur Andersen LLP.
- ---------------
(1) Incorporated by reference to our Quarterly Report on Form 10-Q for the
period ended September 30, 1996.
(2) Incorporated by reference to our Registration Statement on Form S-1, as
amended (File No. 333-2144).
ITEM 17. UNDERTAKINGS.
Our company, the undersigned registrant, hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "Securities Act");
(ii) To reflect in the prospectus any facts or events arising after the
effective date of this Registration Statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in this Registration Statement.
Notwithstanding the foregoing, any increase or decrease in the volume of
securities offered (if the total dollar value of securities offered would not
exceed that which was registered) and any derivation from the low or high and of
the estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than 20 percent change in the
maximum aggregate offering price set forth in the "Calculation of Registration
Fee" table in the Registration Statement; and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in this Registration Statement or any
material change to such information in this Registration Statement;
provided, however, that paragraphs (i) and (ii) do not apply if the registration
statement is on Form S-3, Form S-8 or Form F-3, and the information required to
be included in a post-effective amendment by those paragraphs is contained in
periodic reports filed with or furnished to the Commission by the registrant
pursuant to Section 13 and 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(2) That, for the purposes of determining any liability under the
Securities Act, each post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at the time shall be deemed to be the initial BONA
FIDE offering thereof.
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<PAGE>
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
We hereby undertake that, for purposes of determining any liability
under the Securities Act, each filing of our annual report pursuant to Section
13(a) or 15(d) of the Exchange Act (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the Exchange
Act) that is incorporated by reference in this Registration Statement shall be
deemed to be a new registration statement relating to the securities offered
therein and the offering of such securities at the time shall be deemed to be
the initial BONA FIDE offering thereof.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers, and controlling persons of our
company pursuant to the indemnification provisions described herein, or
otherwise, we have been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by us
of expenses incurred or paid by a director, officer, or controlling person of
our company in the successful defense of any action, suit, or proceeding) is
asserted by such director, officer, or controlling person in connection with the
securities being registered, we will, unless in the opinion of our counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by us is
against public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
BioTransplant Incorporated certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form S-3 and has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Charlestown,
Commonwealth of Massachusetts, on this 28th day of March, 2000.
BIOTRANSPLANT INCORPORATED
By: /s/ Elliot Lebowitz
-------------------------------
Elliot Lebowitz, Ph.D.
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ Elliot Lebowitz President, Chief Executive Officer and March 28, 2000
------------------------------- Director (Principal Executive Officer)
Elliot Lebowitz, Ph.D.
/s/ Richard V. Capasso Vice President, Finance and Treasurer March 28, 2000
----------------------------- (Principal Financial and Accounting
Richard V. Capasso Officer)
</TABLE>
II-5
<PAGE>
<TABLE>
<S> <C> <C>
/s/ Donald R. Conklin Director March 28, 2000
-----------------------------
Donald R. Conklin
Director March __, 2000
-----------------------------
William W. Crouse
/s/ James C. Foster Director March 28, 2000
-----------------------------
James C. Foster
/s/ Daniel O. Hauser, Ph.D. Director March 28, 2000
-----------------------------
Daniel O. Hauser, Ph.D.
Director March __, 2000
-----------------------------
Michael S. Perry, D.V.M.
Director March __, 2000
-----------------------------
Robert A. Vukovich, Ph.D.
</TABLE>
II-6
<PAGE>
Exhibit 5
HALE AND DORR LLP
COUNSELLORS AT LAW
60 STATE STREET, BOSTON, MASSACHUSETTS 02109
617-526-6000 o fax 617-526-5000
March 28, 2000
BioTransplant Incorporated
Building 75, Third Avenue
Charlestown Navy Yard
Charlestown, MA 02129
Re: Registration Statement on Form S-3
----------------------------------
Ladies and Gentlemen:
This opinion is furnished to you in connection with a Registration
Statement on Form S-3 (the "Registration Statement") filed with the
Securities and Exchange Commission (the "Commission") under the Securities
Act of 1933, as amended (the "Securities Act"), for the registration of (i)
an aggregate of 3,754,097 shares of Common Stock, $0.01 par value per share
(the "Shares"), of BioTransplant Incorporated, a Delaware corporation (the
"Company") and (ii) an aggregate of 208,153 shares of Common Stock issuable
upon the exercise of warrants held by certain stockholders of the Company
(the "Warrant Shares"), all of which Shares and Warrant Shares, if and when
sold, will be sold by certain stockholders of the Company (the "Selling
Stockholders").
We have examined signed copies of the Registration Statement as filed
with the Commission. We have also examined and relied upon minutes of meetings
of the stockholders and the Board of Directors of the Company as provided to us
by the Company, stock record books of the Company as provided to us by the
Company, the Certificate of Incorporation and By-Laws of the Company, each as
restated and/or amended to date, and such other documents as we have deemed
necessary for purposes of rendering the opinions hereinafter set forth.
In our examination of the foregoing documents, we have assumed the
genuineness of all signatures, the authenticity of all documents submitted to us
as originals, the conformity to original documents of all documents submitted to
us as copies, the authenticity of the originals of such latter documents and the
legal competence of all signatories to such documents.
<PAGE>
We assume that the appropriate action will be taken, prior to the offer
and sale of the Shares or Warrant Shares to register and qualify the Shares or
Warrant Shares for sale under all applicable state securities or "blue sky"
laws.
We express no opinion herein as to the laws of any state or
jurisdiction other than the state laws of the Commonwealth of Massachusetts, the
Delaware General Corporation Law and statute and the federal laws of the United
States of America. To the extent that any other laws govern the matters as to
which we are opining herein, we have assumed that such laws are identical to the
state laws of the Commonwealth of Massachusetts, and we are expressing no
opinion herein as to whether such assumption is reasonable or correct.
Based upon and subject to the foregoing, we are of the opinion that
1. The Shares have been duly authorized and are validly issued, fully
paid and nonassessable;
2. The Warrant Shares have been duly authorized, and when issued upon
exercise of the warrants in accordance with the terms of such warrants, will
be validly issued, fully paid and nonassessable.
It is understood that this opinion is to be used only in connection
with the offer and sale of the Shares or the Warrant Shares while the
Registration Statement is in effect.
Please note that we are opining only as to the matters expressly set
forth herein, and no opinion should be inferred as to any other matters. This
opinion is based upon currently existing statutes, rules, regulations and
judicial decisions, and we disclaim any obligation to advise you of any change
in any of these sources of law or subsequent legal or factual developments which
might affect any matters or opinions set forth herein.
We hereby consent to the filing of this opinion with the Commission as
an exhibit to the Registration Statement in accordance with the requirements of
Item 601(b)(5) of Regulation S-K under the Securities Act and to the use of our
name therein and in the related Prospectus under the caption "Legal Matters." In
giving such consent, we do not
<PAGE>
hereby admit that we are in the category of persons whose consent is required
under Section 7 of the Securities Act or the rules and regulations of the
Commission.
Very truly yours,
/s/ Hale and Dorr LLP
HALE AND DORR LLP
<PAGE>
Exhibit 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in this registration statement of our report dated
February 11, 2000 included in the Company's Form 10-K for the year ended
December 31, 1999 and to all references to our Firm included in this
registration statement.
/s/ Arthur Andersen LLP
ARTHUR ANDERSEN LLP
Boston, Massachusetts
March 27, 2000
