Filed Pursuant to Rule 424(c)
Relating to Registration Statement No. 333-13469
TITAN PHARMACEUTICALS, INC.
SUPPLEMENT DATED JUNE 16, 1997
TO REGISTRATION STATEMENT DATED DECEMBER 2, 1996
This supplement should be read in conjunction with the Prospectus dated
December 2, 1996 contained in Registration Statement No. 333-13469 (the "Old
Registration Statement") of Titan Pharmaceuticals, Inc., a Delaware corporation
(the "Company"), including the exhibits thereto.
Agreement with Hoechst Marion Roussel, Inc.
On January 9, 1997, the Company entered into an agreement with Hoechst
Marion Roussel, Inc. ("HMRI") pursuant to which the Company was granted an
exclusive, worldwide license to develop, manufacture, sell and/or sublicense the
antipsychotic agent Iloperidone. The agreement required the Company to pay HMRI
an upfront license fee of $9.5 million payable as follows: (i) $2 million in
cash on January 20, 1997; (ii) $5.5 million in common stock of the Company
(594,595 shares) on January 20, 1997 and (iii) $2 million in cash to be paid on
July 18, 1997. The agreement provides for future payments to HMRI contingent
upon the achievement of product development regulatory milestones and HMRI will
be entitled to a royalty on net sales of the product. HMRI was granted
registration rights commencing in September 1997.
Ingenex sale of GSX System
On June 4, 1997, Ingenex, Inc., a majority-owned subsidiary of the Company,
completed the sale of its GSX System, a research technology, and certain fixed
assets to Pharmaceutical Product Development, Inc. for $8,722,500 in cash and
the assumption of certain lease liabilities. The following sets forth the
condensed consolidated balance sheet of the Company at March 31, 1997 giving pro
forma effect to the consummation of the sale:
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<CAPTION>
Pro Forma
At March 31, 1997 Adjustments(1) at March 31, 1997
----------------- -------------- -----------------
(unaudited) (unaudited)
<S> <C> <C> <C>
Assets
Current assets:
Cash and cash equivalents $ 3,365,609 7,634,775 $ 11,000,384
Short-term investments 4,500,000 4,500,000
Prepaid expenses and other current assets 213,755 213,755
Receivable from Ansan Pharmaceuticals, Inc. 136,915 136,915
------------ ------------
Total current assets 8,216,279 15,851,054
Furniture and equipment, net 734,982 (422,195) 312,787
Deferred financing costs 84,787 (84,787) --
Note receivable from Ansan Pharmaceuticals, Inc. 1,000,000 1,000,000
Investment in Ansan Pharmaceuticals, Inc. 310,815 310,815
Other assets 280,092 (125,344) 154,748
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$ 10,626,955 $ 17,629,404
============ ============
Liabilities and Stockholders' Equity Current liabilities:
Accounts payable $ 706,746 $ 706,746
License fee payable 2,000,000 2,000,000
Accrued legal fees 516,946 100,000 616,946
Accrued sponsored research 92,811 92,811
Other accrued liabilities 432,017 582,651 1,014,668
Current portion of capital lease obligations 276,143 (276,143) --
Current portion of technology financing - Ingenex, Inc. 591,652 (591,652) --
------------ ------------
Total current liabilities 4,616,315 4,431,171
Noncurrent portion of capital lease obligation 408,501 (408,501) --
Noncurrent portion of technology financing - Ingenex, Inc. 562,600 (562,600) --
------------ ------------
Total liabilities 5,587,416 4,431,171
Commitments
Minority interest - Series B preferred stock of Ingenex, Inc. 1,241,032 1,241,032
Guaranteed security value 5,500,000 5,500,000
Stockholders' equity (net capital deficiency):
Common stock, at amounts paid in 49,622,782 49,622,782
Additional paid-in capital 6,521,353 6,521,353
Deferred compensation (587,160) (587,160)
Deficit accumulated during the development stage (57,258,468) 8,158,694 (49,099,774)
------------ ------------
Total stockholders' equity (net capital deficiency) (1,701,493) 6,457,201
------------ ------------
$ 10,626,955 $ 17,629,404
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(1) Reflects the use of a portion of the proceeds to repay all outstanding
amounts owed under a technology financing arrangement. Additionally, the Company
has provided for certain accrued liabilities aggregating $683,000 in connection
with the sale, including severance payments, legal fees and other items.
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