FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Quarterly Report under Section 13 of the
Securities Exchange Act of 1934
Quarter ended March 31, 1998
Commission File Number 0-24320
NaPRO BIOTHERAPEUTICS, INC.
Incorporated in Delaware IRS ID No. 84-1187753
6304 Spine Road, Unit A
Boulder, CO 80301
(303) 530-3891
NaPro BioTherapeutics, Inc. ("NaPro" or "the Company") (1) has filed all reports
required to be filed by Section 13 of the Securities Exchange Act of 1934 during
the preceding 12 months, and (2) has been subject to such filing requirements
for the past 90 days.
The number of shares outstanding of each of the issuer's classes of common stock
as of May 6, 1998:
Common Stock, $.0075 par value 13,842,381
Non-voting Common Stock, $.0075 par value 395,000
Total number of pages in document--15
<PAGE>
NaPro BioTherapeutics, Inc.
Table of Contents
Page
Part I Financial Information
Consolidated Financial Statements
Balance Sheet 3
Statement of Operations 5
Statement of Cash Flow 6
Notes to Consolidated Financial Statements 7
Management's Discussion and Analysis of Financial Condition
and Results of Operations 9
Quantitative and Qualitative Disclosures about Market Risk 13
Part II Other Information
Legal Proceedings 13
Changes in Securities 13
Defaults Upon Senior Securities 13
Submission of Matters to a Vote of Security Holders 13
Other Information 14
Exhibits and Reports on Form 8-K 14
Signatures 15
<PAGE>
Part I. Financial Information
Item 1. Consolidated Financial Statements
<TABLE>
<CAPTION>
NaPro BioTherapeutics, Inc.
Balance Sheet
Assets
March 31, December 31,
1998 1997
(unaudited)
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 9,878,000 $ 8,102,000
Accounts receivable 972,000 1,508,000
Inventory 2,122,000 3,122,000
Restricted cash 2,000,000 --
Prepaid expense and other 506,000 481,000
Total current assets 15,478,000 13,213,000
Property and equipment, net 14,529,000 15,187,000
Restricted cash 196,000 246,000
Inventory 2,836,000 1,176,000
Other assets 536,000 536,000
------------- ------------
Total assets $ 33,575,000 $ 30,358,000
============= ============
See accompanying notes
<PAGE>
NaPro BioTherapeutics, Inc.
Balance Sheet
Liabilities and Stockholders' Equity
March 31, December 31,
1998 1997
(unaudited)
Current liabilities:
Accounts payable $ 3,360,000 $ 4,361,000
Accrued payroll and payroll taxes 595,000 570,000
Notes payable--current portion 515,000 743,000
Senior convertible debt 7,054,000 8,134,000
Deferred revenue 4,587,000 1,890,000
---------- ----------
Total current liabilities 16,111,000 15,698,000
Notes payable--long term 480,000 480,000
Total liabilities 16,591,000 16,178,000
Minority interest 622,000 2,574,000
Senior convertible redeemable preferred stock, Series C 4,514,000 4,344,000
Stockholders' equity Preferred stock, $.001 par value:
Authorized shares--2,000,000
Issued--none (unaudited in 1998) -- --
Non-voting common stock, convertible on disposition
into voting common stock, $.0075 par value:
Authorized shares--1,000,000 shares
Issued and outstanding shares--395,000 (unaudited
in 1998) 3,000 3,000
Common stock, $.0075 par value:
19,000,000 authorized
14,245,216 shares issued in 1998 (unaudited),
and 13,134,021 in 1997 109,000 98,000
Additional paid-in capital 53,644,000 50,833,000
Deficit (39,234,000) (40,998,000)
Treasury stock--218,838 shares (2,674,000) (2,674,000)
Total stockholders' equity 11,848,000 7,262,000
Total liabilities and stockholders' equity $ 33,575,000 $30,358,000
========== ==========
See accompanying notes
</TABLE>
<PAGE>
NaPro BioTherapeutics, Inc.
<TABLE>
<CAPTION>
Statement of Operations
(Unaudited)
Three Months Ended
March 31,
1998 1997
------------- ---------------
<S> <C> <C>
Sales $ 2,415,000 $ 1,008,000
-------------- ----------------
Expense:
Research, development and cost of products sold 2,645,000 2,405,000
General and administrative 1,876,000 1,512,000
-------------- ----------------
4,521,000 3,917,000
Operating loss (2,106,000) (2,909,000)
Other income/(expense):
License fee 4,070,000 --
Interest income 93,000 166,000
Interest and other expense (293,000) (82,000)
-------------- ----------------
Net income/(loss) $ 1,764,000 $ (2,825,000)
============== ================
Earnings/(loss) per common share $ .13 $ (.24)
============== ================
Earnings/(loss) per common share, assuming dilution $ .10 $ (.24)
============== ================
Weighted average shares outstanding 13,549,358 11,791,892
============== ================
Weighted average shares outstanding, assuming dilution 16,961,508 11,791,892
============== ================
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
NaPro BioTherapeutics, Inc.
Statement of Cash Flow
(Unaudited)
Three Months Ended
March 31,
<S> <C> <C>
1998 1997
Operating activities
Net income/(loss) $ 1,764,000 $(2,825,000)
Adjustments to reconcile net loss to net cash provided
(used) by operating activities:
Depreciation 497,000 221,000
Accretion of debt discount 149,000 --
Compensation for common stock and options 139,000 --
Interest paid in stock 102,000 --
Changes in operating assets and liabilities:
Accounts receivable 536,000 229,000
Inventory (660,000) (607,000)
Prepaid expense and other assets (25,000) (227,000)
Accounts payable (523,000) (158,000)
Accrued liabilities 64,000 37,000
Deferred revenue 2,698,000 --
--------- ---------
Net cash provided (used) by operating activities 4,741,000 (3,330,000)
Investing activities
Transfer of restricted cash (1,950,000) --
Additions to property and equipment (311,000) (2,521,000)
Purchase of securities held to maturity -- (3,500,000)
Proceeds from securities held to maturity -- 2,800,000
Proceeds from the sale of property and equipment 3,000 --
--------- ---------
Net cash used by investing activities (2,258,000) (3,221,000)
Financing activities
Proceeds from notes payable 80,000 80,000
Payments under notes payable (829,000) (175,000)
Proceeds from sale of common stock 42,000
--------- ---------
--
Net cash used by financing activities (707,000) (95,000)
--------- ---------
Net increase (decrease) in cash and cash equivalents 1,776,000 (6,646,000)
Cash and cash equivalents at beginning of period 8,102,000 9,531,000
--------- ---------
Cash and cash equivalents at end of period $ 9,878,000 $ 2,885,000
========= =========
</TABLE>
See accompanying notes.
<PAGE>
NaPro BioTherapeutics, Inc.
Notes to Consolidated Financial Statements
March 31, 1998
(Unaudited)
1. Basis of Presentation
The accompanying financial statements are unaudited. However, in the opinion of
management, the financial statements reflect all adjustments, consisting of only
normal recurring adjustments, necessary for fair presentation. Interim results
of operations are not indicative of results for the full year. These financial
statements should be read in conjunction with the NaPro Annual Report on Form
10-K for the year ended December 31, 1997.
2. Inventory March 31, December 31,
1998 1997
Raw materials $ 137,000 $ 412,000
Work-in-process 1,176,000 1,408,000
Finished goods 809,000 1,302,000
----------------------------------
$2,122,000 $3,122,000
=================================
Non-current inventory
Raw materials $ 311,000 $ 347,000
Work-in-process 1,625,000 288,000
Finished goods 900,000 541,000
----------------------------------
$2,836,000 $1,176,000
=================================
3. Cash Flow Supplemental Disclosures
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1998 1997
-------------- ---------
<S> <C> <C>
Interest paid $ 145,000 $ 73,000
Noncash transactions:
Repurchase of common stock into treasury -- 990,000
Issuance of common stock--compensation 40,000 40,000
Conversion of preferred shares of subsidiary
to common shares of parent 1,951,000 --
Issuance of common stock in exchange for
interest payable 102,000 --
Issuance of common stock in exchange for
senior convertible debt 713,000 --
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Cash Flow Supplemental Disclosures
(Continued) Three Months Ended
March 31,
1998 1997
--------- ---------
<S> <C> <C>
Issuance of common stock in exchange for
convertible redeemable preferred stock 60,000 --
Accretion of convertible preferred stock
conversion rights valuation, offering
cost and warrant valuation 234,000 --
</TABLE>
4. Common Stock
In January 1998 NaPro issued 240,900 shares of common stock in exchange of
240,900 shares of preferred stock of NaPro BioTherapeutics (Canada), Inc. In
February 1998, NaPro issued 4,268 shares of common stock to certain officers and
other key employees for vesting under stock bonuses granted and recorded in
November 1995. This represented final vesting under the grants. In the March
1998 quarter NaPro issued 646,956 shares of common stock in conversion of
$713,000 of NaPro's senior convertible debt. In March 1998 NaPro issued 125,295
shares of common stock in payment of $102,000 interest on the senior convertible
debt. In March 1998 NaPro issued 70,903 shares of common stock in conversion of
60 shares of NaPro's senior convertible preferred stock. In March 1998 NaPro
issued 78,248 shares of common stock in payment of dividends on the senior
convertible preferred stock.
5. Earnings per Share
The following table sets for the computation of basic and diluted earnings per
share:
<TABLE>
<CAPTION>
March 31,
1997 1998
<S> <C> <C>
Numerator:
Net income (loss) $ (2,825,000) $1,764,215
Preferred stock dividends (62,500)
----------- ---------
Numerator for basic earnings per share - income
available to common stockholders $ (2,825,000) $1,701,715
Effect of dilutive securities:
Senior convertible debt 18,801
Preferred stock dividends 47,149
Numerator for diluted earnings per share - income
available to common stockholders after assumed conversions $1,767,665
Denominator
Denominator for basic earnings per share - weighted
average shares 11,791,892 13,549,358
==========
</TABLE>
<PAGE>
Earning per Share (Continued)
<TABLE>
<CAPTION>
March 31,
1997 1998
<S> <C> <C>
Effect of dilutive securities:
Senior convertible debt 954,960
Convertible preferred stock 2,031,700
Non-voting common stock 395,000
Stock options and warrants 30,490
---------
Dilutive potential common shares 3,412,150
---------
Denominator for diluted earning per share - adjusted
weighted-average shares and assumed conversions 16,961,508
Basic earning (loss) per share $ (0.24) $ 0.13
============= ===============
Diluted earnings per share $ 0.10
</TABLE>
6. Restructuring
In February 1998, due to the delay in receiving marketing approval for NBT
Paclitaxel, NaPro underwent a restructuring to decrease overall cost, resulting
in a one-time charge of approximately $250,000. NaPro's total number of
employees has been reduced by 53, a 43% reduction in full time positions. As
part of the restructuring NaPro temporarily closed its British Columbia
manufacturing facility and suspended construction of its commercial scale
manufacturing facility in Boulder, Colorado.
7. Termination of the IVAX Agreements
In March 1998, NaPro and IVAX entered into the Termination Agreement. Under the
terms of the Termination Agreement, IVAX received a royalty-free, limited,
non-exclusive license to one of NaPro's pending patents in the U.S., Europe, and
certain other world markets. In return, NaPro received a cash payment of $6
million, $2 million of which was placed in escrow to be released as remaining
product is delivered. Revenue related to the escrow funds has been deferred and
will be recognized as funds are released from the escrow. In addition, IVAX
returned in April 1998 approximately 1.1 million shares of NaPro common stock
and, upon issue of additional pending patents, IVAX will make additional
payments of up to $6.4 million ($3.75 million of which was received in April
1998). NaPro will continue to manufacture a fixed amount of NBT Paclitaxel for
delivery to IVAX periodically over not more than twelve months. NaPro received
advance payments for 70% of such sales. Such payments are classified as deferred
revenue. NaPro expects to receive the remaining portion of the purchase price at
the time of delivery.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
The following discussion and analysis provide information which the Company's
management believes is relevant to an assessment and understanding of the
Company's results of operations and financial condition. This discussion should
be read in conjunction with the consolidated financial statements and notes
thereto appearing elsewhere herein as well as with the consolidated financial
statements, notes thereto and the related management's discussion and analysis
of financial condition and results of operations included in the Company's
Annual Report on Form 10-K for the year ended December 31, 1997.
<PAGE>
General
NaPro is a natural product pharmaceutical company which is focusing primarily on
the development, manufacture and commercialization of paclitaxel, a
naturally-occurring anti-cancer agent found in certain species of yew (Taxus)
trees. The Company's paclitaxel is referred to herein as "NBT Paclitaxel."
NaPro has devoted its efforts primarily to the development and implementation of
its proprietary extraction, isolation and purification (EIPTM) technology for
producing NBT Paclitaxel. To advance the development and commercialization of
NBT Paclitaxel, NaPro entered into 20-year, exclusive agreement with each of
F.H. Faulding & Co., Ltd. ("Faulding") and IVAX Corporation (including its
subsidiaries, "IVAX") for the clinical development, sales, marketing and
distribution of NBT Paclitaxel. NaPro and IVAX entered into an agreement on
March 20, 1998 (the "Termination Agreement") terminating their development and
marketing relationship, and NaPro is actively seeking one or more partners to
replace IVAX. NaPro is currently dependent for revenue exclusively on sales of
NBT Paclitaxel, on royalties from licensed technology and amounts due under the
Termination Agreement.
Through March 31, 1998, NaPro's production of NBT Paclitaxel was limited
primarily to research and pilot-scale production, and much of NaPro's product
sales were for use in clinical trials and for research and development purposes.
Accordingly, NaPro has generated only limited revenue from such activities and
has incurred significant losses, including losses of approximately $4.1 million,
$6.8 million and $15.5 million for the years ended December 31, 1995, 1996 and
1997, respectively. For the quarter ended March 31, 1998, largely as a result of
a non-recurring license fee received from IVAX, NaPro recorded net income of
approximately $1.8 million, resulting in an accumulated deficit of $39.2 million
as of March 31, 1998. NaPro expects that it will continue to have a high level
of operating expense and will be required to make significant up-front
expenditures in connection with its biomass procurement, product development and
research-and-development activities. NaPro anticipates that annual losses will
continue until such time, if ever, as NaPro is able to generate sufficient
revenue to support its operations. NaPro believes that its ability to generate
such revenue depends primarily on the ability to obtain regulatory approval in
the U.S. or another major market for the commercial sale of NBT Paclitaxel, on
NaPro's ability to obtain regulatory approval for its manufacturing facilities
and on NaPro's ability to construct manufacturing facilities that produce
quantities of NBT Paclitaxel sufficient to supply NaPro's strategic partners'
requirements for commercial sales. Moreover, NaPro's future growth and
profitability will depend on the success of its strategic partners in fostering
acceptance in the oncological market for NBT Paclitaxel as a preferred form of
chemotherapy to be used alone or in combination with other chemotherapeutic
agents.
In February 1998, due to the delay in receiving marketing approval for NBT
Paclitaxel, NaPro underwent a restructuring to decrease overall cost, resulting
in a one-time charge of approximately $250,000. NaPro's total number of
employees has been reduced by 53, a 43% reduction in full time positions,
expected to result in an annual savings of $2.8 million in payroll expense. This
payroll expense is reflected in research and development, as well as general and
administrative expense. In addition, non-payroll expense is also expected to
decrease as the result of the restructuring. As part of the restructuring NaPro
temporarily closed its British Columbia manufacturing facility and suspended
construction of its commercial scale manufacturing facility in Boulder,
Colorado. Completion of the Boulder facility will require additional financing,
which the Company intends to seek at such time, if ever, as NaPro anticipates
sufficient product demand to warrant completion of the facility.
<PAGE>
In March 1998, NaPro and IVAX entered into the Termination Agreement. Under the
terms of the Termination Agreement, IVAX received a royalty-free, limited,
non-exclusive license to one of NaPro's pending patents in the U.S., Europe, and
certain other world markets. In return, NaPro received a cash payment of $6
million, $2 million of which was placed in escrow to be released as remaining
product is delivered through March 1999. Revenue related to the escrow funds has
been deferred and will be recognized as funds are released from the escrow. In
addition, IVAX returned in April 1998 approximately 1.1 million shares of NaPro
common stock and, upon issue of additional pending patents, IVAX will make
additional payments of up to $6.4 million ($3.75 million of which was received
in April 1998). NaPro will continue to manufacture a fixed amount of NBT
Paclitaxel for delivery to IVAX periodically over not more than twelve months,
to be paid for at the time of delivery.
The termination of the IVAX Agreement leaves NaPro free to seek regulatory
approvals and market NBT Paclitaxel itself or to seek a new partner or partners
with which to pursue regulatory approvals and marketing of NBT Paclitaxel, in
either case outside the Faulding territory. However, the termination of the IVAX
Agreement currently leaves NaPro without such a partner, and there can be no
assurance that NaPro will be able to secure such approvals or form new long-term
relationships for the approval, marketing, and distribution of NBT Paclitaxel in
these areas, or that NaPro or such a partner, if found, will be able to
effectively market NBT Paclitaxel. NaPro's future growth and profitability will
depend on the success of NaPro's strategic partners in fostering acceptance in
the oncology market for NBT Paclitaxel as a preferred form of chemotherapy to be
used alone or in combination with other chemotherapeutic agents.
Results of Operations
Three months ended March 31, 1998 compared to the three months ended March 31,
1997 Sales for the three months ended March 31, 1998 were $2.4 million,
representing an increase of $1.4 million from the three months ended March 31,
1997. The increase related primarily to the timing of product shipments.
Shipments to the strategic partners may vary significantly on a quarter to
quarter basis depending on a number of factors, including the timing and size of
any clinical trials conducted by either company, the level of inventory carried
by the strategic partners and changes in approved markets. This quarter to
quarter variability will continue until stable commercial demand has been
established for the product in a major market.
Research and development and cost of products sold expense for the three months
ended March 31, 1998 was $2.6 million, representing an increase of $200,000 from
the three months ended March 31, 1997. The increase resulted from an increase in
the level of process development and research expense as well as higher
production cost. However, per-unit cost of production decreased significantly
from the 1997 quarter to the 1998 quarter as a result of improvements in the
production process. NaPro's production process is not distinct from its research
and development processes. Accordingly, the cost of products sold is included
with NaPro's research and development expense.
General and administrative expense for the three months ended March 31, 1998 was
$1.9 million, an increase of $400,000 from the three months ended March 31,
1997. The increase is primarily attributable to the cost associated with the
restructuring and increased legal fees.
<PAGE>
License fee income for the three months ended March 31, 1998 was $4.1 million.
There was no analogous income for the 1997 quarter. This revenue related to a
one-time up-front license fee paid by IVAX in conjunction with the Termination
Agreement. NaPro expects to record up to an additional $8.4 million in license
fees over the next 12 months associated with the Termination Agreement. NaPro is
actively seeking one or more new pharmaceutical partners to replace IVAX. There
can be no assurance, however, that NaPro will succeed in obtaining any new
pharmaceutical partners or in earning any license fees other than the
Termination Agreement license fee.
Interest income for the three months ended March 31, 1998 was $100,000,
representing a decrease of $70,000 from the three months ended March 31, 1997.
This decrease is primarily due to the decreased cash balances available for
investment.
Interest and other expense for the three months ended March 31, 1997 was
$300,000, representing an increase of $200,000 from the three months ended March
31, 1997. The increase is attributable largely to interest on the senior
convertible debt. (See Liquidity and Capital Resources).
Liquidity and Capital Resources
NaPro's capital requirements have been and will continue to be significant. At
March 31, 1998, NaPro had negative working capital balance of $600,000. This
compared to a negative working capital balance of $2.5 million as of December
31, 1997. Current liabilities include $7.1 million and $8.1 million,
respectively, related to the senior convertible debt. If this debt is converted
rather than redeemed, it will result in an increase in working capital. If the
debt were to be redeemed, the effect on working capital would not be material
but there would be a significant reduction in cash. To date, the funding of
NaPro's capital requirements has been dependent primarily on the net proceeds of
public offerings of its common stock of approximately $21.1 million, on private
placements of its equity securities of approximately $27.8 million, on the
exercise of warrants and options of $5.6 million, on net borrowings of $11.8
million, and on loans and advances from its stockholders and strategic partners.
In June and December 1997, NaPro issued its Senior Convertible Notes Due 2000
(the "Convertible Notes") and Series C Senior Convertible Preferred Stock (the"
Convertible Preferred Stock"), respectively. The Convertible Notes and the
Convertible Preferred Stock are referred to as the "Convertible Securities."
Under the terms of the Convertible Securities, as amended, NaPro is required to
seek stockholder approval by June 1, 1998 of two proposals necessary to permit
conversion of the Convertible Securities in accordance with their terms without
regard to limitations imposed by rules applicable to Nasdaq National Market
issuers.
If stockholder approval of the proposals described in the immediately preceding
paragraph is not received by June 1, 1998, and assuming no additional conversion
of Convertible Securities and no change in the conversion price from that
effective on April 20, 1998, the holders of the Convertible Securities would be
entitled to require NaPro to redeem the Convertible Securities for a redemption
price exceeding $12.3 million. The failure to obtain such stockholder approval
and related redemption of the Convertible Securities could have a material
adverse effect on NaPro because NaPro could be required to deplete severely its
cash resources. If stockholder approval of such proposals is received, over 4.9
million shares of Common Stock could be issued by NaPro upon conversion of the
Convertible Securities, subject to certain limitations under the terms of the
Convertible Securities. The issuance of shares of Common Stock upon conversion
of the Convertible Securities would result in substantial dilution of the
interest of the current stockholders of NaPro.
<PAGE>
Cash and cash equivalents totaled $9.9 million at March 31, 1998. During the
first three months of 1998, cash provided by operating activities totaled $4.7
million, and cash used by investing and financing activities totaled $2.3
million and $700,000, respectively. NaPro expended $300,000 for plantation cost
during the first three months of 1998.
The amount and timing of future capital expenditures will depend upon numerous
factors, including the progress of NaPro's research and development program, the
magnitude and scope of these activities, the cost of preparing, filing,
prosecuting, maintaining and enforcing patent claims and other intellectual
property rights, competing technological and marketing developments, changes in
existing strategic partnerships, the establishment of additional strategic
relationships and the cost of manufacturing scale-up. NaPro may seek additional
long-term financing to fund capital expenditures should such financing become
available on terms acceptable to NaPro.
Item 3. Quantitative and Qualitative Disclosures about Market Risk. Not
applicable.
Part II--Other Information
Item 1. Legal Proceedings
There have been no material developments.
Item 2. Changes in Securities
In the March 1998 quarter NaPro issued 646,956 shares of common stock in
conversion of $708,000 of the Convertible Notes. In March 1998 NaPro issued
125,295 shares of common stock in payment of $107,000 interest on the
Convertible Notes. In March 1998 NaPro issued 70,903 shares of common stock in
conversion of 60 shares of the Convertible Preferred Stock. In March 1998 NaPro
issued 78,248 shares of common stock in payment of dividends on the Convertible
Preferred Stock. The issuance of shares of common stock upon conversion of the
Convertible Securities was exempt from registration under section 3(a)(a) of the
Securities Act of 1933, as amended (the "Securities Act"). The issuance of
shares of common stock in the payment of interest and dividends was exempt as a
private placement to sophisticated investors under section 4(2) of the
Securities Act and Regulation D thereunder.
Certain provisions of the Convertible Preferred Stock may limit the ability of
NaPro to pay dividends on its common stock and to repurchase shares of its
common stock. See "Part I, Item 2--Management's Discussion and Analysis of
Financial Condition and Results of Operations--Outstanding Convertible
Securities."
Item 3. Defaults upon Senior Securities. None.
Item 4. Submission of Matters to a Vote of Securities Holders. None.
<PAGE>
Item 5. Other Information.
Special Note Regarding Forward-looking Statements.
Certain statements in this report constitute "forward-looking statements" within
the meaning of the federal securities laws. In addition, NaPro or persons acting
on its behalf sometimes make forward-looking statements in other written and
oral communications. Such forward-looking statements may include, among other
things, statements concerning NaPro's plans, objectives and future economic
prospects, such as matters relative to seeking and obtaining strategic partners;
the availability of patent and other protection for its intellectual property;
the completion of clinical trials and regulatory filings; the prospects for and
timing of regulatory approvals; the need for and availability of additional
capital; the amount and timing of capital expenditures; timing of products
introductions and revenue; the availability of raw materials; prospects for
future operations; and other statements of expectations, beliefs, future plans
and strategies, anticipated events or trends and similar expressions concerning
matters that are not historical facts. Such forward-looking statements involve
known and unknown risks, uncertainties and other factors which may cause the
actual results, performance or achievements of NaPro, or industry results, to be
materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements. Such factors include,
among other things, the following: adverse economic and general business
conditions; competition from Bristol and other existing and new producers of
paclitaxel and other drugs; technological advances in cancer treatment and drug
development; the ability to obtain rights to technology; the ability to obtain
and enforce patents; the ability to obtain raw materials and commercialize
manufacturing processes; the effectiveness of NBT Paclitaxel and other
pharmaceuticals developed by NaPro in treating disease; the results of clinical
studies; the results of research and development activities; the business
abilities and judgment of NaPro's management and other personnel; the
availability of qualified personnel generally; changes in and compliance with
governmental regulations; the effect of capital market conditions and other
factors on capital availability for NaPro and other biopharmaceutical companies;
the ability of Faulding to perform its obligations under its existing agreement
with NaPro; the ability of NaPro to establish relationships with capable
strategic partners to develop and market NBT Paclitaxel in the territories not
covered by the Faulding Agreement and other factors referenced in this Report.
Item 6. Exhibits and Reports on Form 8-K
NaPro filed a January 6, 1998 Current Report on Form 8-K reporting an Agreement
in Principle between the Company and the holders of the 5% Senior Convertible
Notes and the Series C Convertible Preferred Stock, January 28, 1998 and March
20, 1998 Current Reports on Form 8-K reporting amendments with respect to the 5%
Senior Convertible Notes and the Series C Convertible Preferred Stock, and a
March 20, 1998 Current Report on Form 8-K reporting the IVAX Termination
Agreement.
Exhibit
Number Description of Exhibit
27.1 Financial Data Schedule
<PAGE>
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, NaPro has
duly caused this report to be signed on its behalf.
NaPro BioTherapeutics, Inc.
May 15, 1998 /s/ Sterling K. Ainsworth
Sterling K. Ainsworth
President and Chief Executive Officer
(Principal Executive Officer)
May 15, 1998 /s/ Gordon Link
Gordon Link
Vice President and Chief Financial Officer
(Principal Financial Officer)
May 15, 1998 /s/ Robert L. Poley
Robert L. Poley
Controller
(Principal Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-mos
<FISCAL-YEAR-END> Dec-31-1998
<PERIOD-START> Jan-01-1998
<PERIOD-END> Mar-31-1998
<CASH> 9,878
<SECURITIES> 0
<RECEIVABLES> 972
<ALLOWANCES> 0
<INVENTORY> 2,122
<CURRENT-ASSETS> 15,478
<PP&E> 17,948
<DEPRECIATION> 3,419
<TOTAL-ASSETS> 33,575
<CURRENT-LIABILITIES> 16,111
<BONDS> 480
0
4,514
<COMMON> 112
<OTHER-SE> 11,736
<TOTAL-LIABILITY-AND-EQUITY> 33,575
<SALES> 2,415
<TOTAL-REVENUES> 2,415
<CGS> 0
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<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,764
<EPS-PRIMARY> .13
<EPS-DILUTED> .10
</TABLE>
