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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
MARK ONE
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED
JUNE 30, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM ______ TO ______
Commission File Number: 0-24274
LA JOLLA PHARMACEUTICAL COMPANY
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 33-0361285
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
6455 NANCY RIDGE DRIVE 92121
SAN DIEGO, CA (Zip Code)
(Address of Principal Executive Offices)
Registrant's Telephone Number, Including Area Code: (858) 452-6600
Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
YES [X] NO [ ]
The number of shares of the Registrant's common stock, $.01 par value,
outstanding at June 30, 2000 was 24,486,234.
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LA JOLLA PHARMACEUTICAL COMPANY
FORM 10-Q
QUARTERLY REPORT
INDEX
<TABLE>
<S> <C>
COVER PAGE ................................................................. 1
INDEX ...................................................................... 2
PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements
Balance Sheets as of June 30, 2000 (Unaudited) and December 31, 1999.. 3
Statements of Operations (Unaudited) for the three months and six
months ended June 30, 2000 and 1999 .................................. 4
Statements of Cash Flows (Unaudited) for the six months ended
June 30, 2000 and 1999 ............................................... 5
Notes to Financial Statements (Unaudited) ............................ 6
ITEM 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations ......................... 7
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk... 10
PART II. OTHER INFORMATION
ITEM 2. Changes in Securities and Use of Proceeds ................... 10
ITEM 4. Submission of Matters to a Vote of Security Holders ......... 11
ITEM 5. Risk Factors ................................................ 11
ITEM 6. Exhibits and Reports on Form 8-K ............................ 20
SIGNATURES ................................................................. 21
</TABLE>
2
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
LA JOLLA PHARMACEUTICAL COMPANY
BALANCE SHEETS
(in thousands)
<TABLE>
<CAPTION>
June 30, December 31,
2000 1999
----------- ------------
(Unaudited) (Note)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 9,388 $ 4,409
Short-term investments 8,960 6,994
Other current assets 661 464
-------- --------
Total current assets 19,009 11,867
Property and equipment, net 616 658
Patent costs and other assets, net 1,632 1,518
-------- --------
Total assets $ 21,257 $ 14,043
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 210 $ 225
Accrued expenses 696 520
Accrued payroll and related expenses 302 262
Current portion of obligations under capital leases 139 199
-------- --------
Total current liabilities 1,347 1,206
Noncurrent portion of obligations under capital leases -- 44
Commitments
Stockholders' equity:
Common stock 245 202
Additional paid-in capital 97,303 84,358
Accumulated deficit (77,638) (71,767)
-------- --------
Total stockholders' equity 19,910 12,793
-------- --------
Total liabilities and stockholders' equity $ 21,257 $ 14,043
======== ========
</TABLE>
Note: The balance sheet at December 31, 1999 has been derived from the audited
financial statements at that date but does not include all of the information
and footnotes required by generally accepted accounting principles for complete
balance sheets.
See accompanying notes.
3
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LA JOLLA PHARMACEUTICAL COMPANY
STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except per share amounts)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
------------------------- -------------------------
2000 1999 2000 1999
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Revenue from collaborative agreement -
related party $ -- $ 1,455 $ -- $ 3,114
Expenses:
Research and development 2,708 3,232 5,143 6,407
General and administrative 585 881 1,304 1,703
-------- -------- -------- --------
Total expenses 3,293 4,113 6,447 8,110
-------- -------- -------- --------
Loss from operations (3,293) (2,658) (6,447) (4,996)
Interest expense (2) (4) (5) (13)
Interest income 301 196 581 448
-------- -------- -------- --------
Net loss and comprehensive net loss $ (2,994) $ (2,466) $ (5,871) $ (4,561)
======== ======== ======== ========
Basic and diluted net loss per share $ (.12) $ (.12) $ (.25) $ (.23)
======== ======== ======== ========
Shares used in computing basic and
diluted net loss per share 24,401 20,111 23,320 20,110
======== ======== ======== ========
</TABLE>
See accompanying notes.
4
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LA JOLLA PHARMACEUTICAL COMPANY
STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
-----------------------
2000 1999
-------- --------
<S> <C> <C>
OPERATING ACTIVITIES
Net loss $ (5,871) $ (4,561)
Adjustments to reconcile net loss to net cash used for
operating activities:
Depreciation and amortization 199 174
Loss on disposal of property and equipment -- 23
Change in operating assets and liabilities:
Other current assets (197) (108)
Accounts payable and accrued expenses 161 (1,150)
Accrued payroll and related expenses 40 287
Deferred revenue - related party -- (129)
-------- --------
Net cash used for operating activities (5,668) (5,464)
INVESTING ACTIVITIES
(Increase) decrease in short-term investments (1,966) 819
Proceeds from the sale of property and equipment -- 20
(Additions) deletions to property and equipment (128) 139
Increase in patent costs and other assets (143) (184)
-------- --------
Net cash (used for) provided by investing activities (2,237) 794
FINANCING ACTIVITIES
Net proceeds from issuance of common stock 12,988 44
Payments on obligations under capital leases (104) (64)
-------- --------
Net cash provided by (used for) financing activities 12,884 (20)
Net increase (decrease) in cash and cash equivalents 4,979 (4,690)
Cash and cash equivalents at beginning of period 4,409 11,176
-------- --------
Cash and cash equivalents at end of period $ 9,388 $ 6,486
======== ========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Interest paid $ 5 $ 13
======== ========
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND
FINANCING ACTIVITIES:
Capital lease obligations incurred for property and
equipment $ -- $ 228
======== ========
</TABLE>
See accompanying notes.
5
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LA JOLLA PHARMACEUTICAL COMPANY
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
JUNE 30, 2000
1. BASIS OF PRESENTATION
The accompanying unaudited financial statements of La Jolla Pharmaceutical
Company (the "Company") have been prepared in accordance with generally accepted
accounting principles for interim financial information and with the
instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do
not include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all adjustments (consisting of normal recurring accruals) considered
necessary for a fair presentation have been included. Operating results for the
three and six months ended June 30, 2000 are not necessarily indicative of the
results that may be expected for other quarters or the year ended December 31,
2000. For more complete financial information, these financial statements, and
the notes thereto, should be read in conjunction with the audited financial
statements for the year ended December 31, 1999, included in the Company's Form
10-K/A filed with the Securities and Exchange Commission.
2. ACCOUNTING POLICIES
USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and disclosures made in
the accompanying notes to the financial statements. Actual results could differ
from those estimates.
REVENUE RECOGNITION
In December 1999, the Securities and Exchange Commission staff issued Staff
Accounting Bulletin No. 101, Revenue Recognition in Financial Statements ("SAB
101"). SAB 101 formalizes the basic revenue recognition criteria that must be
met in order to record revenue. In June 2000, SAB 101 was amended to delay the
implementation date to the fourth quarter of 2000 to provide additional time to
study the guidance. The Company believes that the adoption of SAB 101 would not
have a material impact on the Company's financial statements.
STOCK COMPENSATION
In March 2000, the Financial Accounting Standards Board ("FASB") issued FASB
Interpretation No. 44, Accounting for Certain Transactions Involving Stock
Compensation ("FIN 44"). FIN 44 clarifies certain issues in the application of
Accounting Principals Board Opinion No. 25, Accounting for Stock Issued to
Employees. FIN 44 is effective July 1, 2000, but certain conclusions cover
specific events that occur after either December 15, 1998, or January 12, 2000.
FIN 44 is not expected to materially impact the Company in 2000.
3. SUBSEQUENT EVENT
In July 2000, the Company issued 4,800,000 shares of common stock in a private
placement to selected institutional investors and other accredited investors for
gross proceeds of approximately $29,400,000 at a discounted per share value
based on the reported last sale price of the common stock on the purchase date.
The Company is required to file a registration statement to register these
shares within 10 business days from the date of closing. There are no other
stated or unstated rights or privileges associated with the sale of these
shares.
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LA JOLLA PHARMACEUTICAL COMPANY
PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
FORWARD-LOOKING STATEMENTS
Statements regarding our analysis of results from pre-clinical and
clinical studies, as well as La Jolla Pharmaceutical's drug candidates and drug
development plans and certain statements made in the "Recent Development"
section, are forward-looking statements involving risks and uncertainties, and a
number of factors, both foreseen and unforeseen, could cause actual results to
differ materially from those anticipated. The Company's analysis of clinical
results is ongoing, and future analyses may not necessarily support conclusions
to date. Clinical results are derived from a trial that was terminated prior to
completion, and certain data may be incomplete. Our blood test to measure
binding affinity for LJP 394 is experimental and has not been validated by
independent laboratories. Tolerance, or the specific inactivation of pathogenic
B cells, is a new technology that has not been proven. Future clinical trials of
LJP 394 may have negative or inconclusive results. Further, delays in continued
testing of LJP 394 and/or termination of development by the Company would result
in delays or lack of government approval to market the compound. The development
of LJP 394 involves many risks and uncertainties, including, without limitation,
whether LJP 394 can provide a meaningful clinical benefit, and any positive
results observed to date may not be indicative of future results. Our other drug
candidates, including our Toleragen candidates for antibody-mediated thrombosis
and for xenotransplantation, none of which has progressed to clinical trials,
involve comparable risks. Readers are cautioned not to place undue reliance upon
forward-looking statements, which speak only as of the date hereof, and we
undertake no obligation to update forward-looking statements to reflect events
or circumstances occurring after the date hereof. Interested parties are urged
to review the risks described below and in other reports and registration
statements of La Jolla Pharmaceutical filed with the Securities and Exchange
Commission from time to time.
Our business is subject to significant risks including, but not limited
to, the risks inherent in our research and development efforts, including
clinical trials, uncertainties associated with both obtaining and enforcing its
patents and with the patent rights of others, the lengthy, expensive and
uncertain process of seeking regulatory approvals, uncertainties regarding
government reforms and of product pricing and reimbursement levels,
technological change and competition, manufacturing uncertainties, our lack of
marketing experience and the uncertainty of receiving future revenue from
product sales or other sources such as collaborative relationships, future
profitability and the need for additional financing. Even if our product
candidates appear promising at an early stage of development, they may not reach
the market for numerous reasons. Such reasons include the possibilities that the
products will be ineffective or unsafe during clinical trials, will fail to
receive necessary regulatory approvals, will be difficult to manufacture on a
large scale, will be uneconomical to market or will be precluded from
commercialization by proprietary rights of third parties. These and other risks
are discussed below in Part II, Item 5 "Risk Factors".
RECENT DEVELOPMENTS
Late in 1999, we reported encouraging results from our continuing
analysis of results from the Phase II/III trial which was suspended in May 1999.
As announced on May 12, 1999, Abbott Laboratories ("Abbott") and La Jolla
Pharmaceutical, in discussion with the Food and Drug Administration ("FDA"),
elected to stop the enrollment and treatment of the more than 200 patients
enrolled in the jointly conducted Phase II/III clinical trial of LJP 394, our
lupus drug candidate, until the data could be validated and analyzed. This
announcement was made subsequent to a planned interim analysis of the Phase
II/III clinical trial, wherein the independent Data Monitoring Committee
reported efficacy as defined by the primary chosen endpoint, time to renal
flare, was less than expected. No major safety concerns were observed, and
patients
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receiving the experimental drug appeared to have a reduction in circulating
antibodies to double-stranded DNA that are associated with lupus nephritis.
On May 2, 2000, we announced that after a recent positive meeting with
the FDA where we provided the results of our analysis of the suspended Phase
II/III trial, we plan to conduct a Phase III trial of our lupus drug candidate,
LJP 394. We expect to begin the trial in the second half of this year.
On May 3, 2000, we announced additional positive results from the Phase
II/III clinical trial of LJP 394. We completed an affinity analysis of more than
99% of the North American patients' samples that showed that 89% of the patients
had high-affinity antibodies to LJP 394. With these additional patients, the
significance of the clinical results increased.
OVERVIEW
Since our inception in May 1989, we have devoted substantially all of
our resources to the research and development of technology and potential drugs
to treat antibody-mediated diseases. We have never generated any revenue from
product sales and have relied upon private and public investors, revenue from
collaborative agreements, equipment lease financings and interest income on
invested cash balances for our working capital. We have been unprofitable since
inception and expect to incur substantial additional expenses and operating
losses for at least the next several years as we increase our clinical trial and
manufacturing scale-up activities including the production of LJP 394 for
clinical trials, and increase our research and development expenditures on
additional drug candidates, and general and administrative expenditures to
support increased clinical trial, research and development and manufacturing
scale-up activities. Our activities to date are not as broad in depth or scope
as the activities we must undertake in the future and our historical operations
and the financial information reported below may not be indicative of our future
operating results or financial condition.
We expect that losses will fluctuate from quarter to quarter as a result
of differences in the timing of expenses incurred and potential revenues from
collaborative arrangements. Some of these fluctuations may be significant. As of
June 30, 2000, our accumulated deficit was approximately $77.6 million.
RESULTS OF OPERATIONS
We earned no revenue from our former collaborative agreement with Abbott
in the three and six months ended June 30, 2000 compared to $1.5 million and
$3.1 million in the same periods in 1999. All revenue earned in 1999 was
attributable to funding under our former collaborative agreement with Abbott for
the development of LJP 394. The decrease in revenue from 1999 is due to the fact
that following the May 1999 suspension of the jointly conducted Phase II/III
clinical trial of LJP 394, Abbott and La Jolla Pharmaceutical terminated the
collaborative agreement for LJP 394 in September 1999, including any further
development funding from Abbott. All rights to the compound were returned to La
Jolla Pharmaceutical at that time. There can be no assurance that we will
realize any further revenue from any other collaborative arrangement.
For the three and six months ended June 30, 2000, research and
development expenses decreased to $2.7 million and $5.1 million, respectively,
from $3.2 million and $6.4 million for the same periods in 1999. The decrease
was due to the restructuring of our operations in September 1999 and the related
reduction in our workforce as well as the decrease in expenses associated with
the suspension of our Phase II/III clinical trial of LJP 394 in May 1999. Our
research and development expenses are expected to increase significantly in the
future as clinical trial and manufacturing scale-up activities including the
production of LJP 394 for clinical trials are increased, efforts to develop
additional drug candidates are intensified, and other potential products
progress into and through clinical trials.
General and administrative expenses decreased to $585,000 and $1.3
million for the three and six months ended June 30, 2000, respectively, from
$881,000 and $1.7 million for the same periods in 1999. The decrease was due to
the restructuring of our operations in September 1999 and the related reduction
in our workforce. We expect general and administrative expenses to increase in
the future in order to support increased clinical trial, manufacturing scale-up
and research and development activities.
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Interest income increased to $301,000 and $581,000 for the three and six
months ended June 30, 2000, respectively, from $196,000 and $448,000 for the
same periods in 1999. The increase in interest income was due to higher
investment balances as a result of the sale of 4,040,000 shares of common stock
to private investors for net proceeds of $12.7 million in February 2000. For the
three and six months ended June 30, 2000, interest expense decreased to $2,000
and $5,000, respectively, from $4,000 and $13,000 for the same periods in 1999.
The decrease in interest expense was the result of decreases in our capital
lease obligations.
LIQUIDITY AND CAPITAL RESOURCES
As of June 30, 2000, we had incurred a cumulative net loss since
inception of approximately $77.6 million, and had financed our operations
through private and public offerings of our securities, payments from
collaborative agreements, capital and operating lease transactions, and interest
income on our invested cash balances. As of June 30, 2000, we had raised $96.7
million in net proceeds since inception from sales of equity securities.
At June 30, 2000, we had $18.3 million in cash, cash equivalents and
short-term investments, as compared to $11.4 million at December 31, 1999. Our
working capital at June 30, 2000 was $17.7 million, as compared to $10.7 million
at December 31, 1999. The increase in cash, cash equivalents and short-term
investments as well as working capital resulted from the sale of 4,040,000
shares of our common stock to private investors for net proceeds of $12.7
million in February 2000 offset by the continued use of our cash towards
operating activities, patent expenditures and the purchase of property and
equipment. We invest our cash in corporate and United States Government-backed
debt instruments.
As of June 30, 2000, we had acquired an aggregate of $4.5 million in
property and equipment, of which approximately $368,000 of total property and
equipment costs are financed under capital lease obligations. In addition, we
lease our office and laboratory facilities and certain property and equipment
under operating leases. We have no material commitments for the acquisition of
property and equipment. However, we anticipate increasing our investment in
property and equipment in connection with the enhancement of our research and
development and manufacturing facilities and capabilities, as well as our
upcoming Phase III trial.
In July 2000, we received net proceeds of approximately $27.5 million
from the sale of 4,800,000 shares of common stock to private investors.
After our meeting with the FDA in May 2000, we decided to conduct a
Phase III trial of our lupus drug LJP 394, scheduled to begin in the second half
of this year. We anticipate that our existing capital along with the net
proceeds of approximately $27.5 million received from our private placement in
July 2000, and interest earned thereon will be sufficient to fund our operations
as currently planned into 2002. However, we will need to obtain additional
capital to fund our Phase III trial to its completion. There can be no assurance
that such funding will be available on acceptable terms, if at all. We intend to
use our financial resources to fund clinical trials and manufacturing scale-up
activities including the production of LJP 394 for clinical trials, research and
development efforts, and for working capital and other general corporate
purposes. The amounts actually expended for each purpose may vary significantly
depending upon numerous factors, including the results of clinical trials, the
timing of any regulatory applications and approvals, and technological
developments. Expenditures will also depend upon the establishment and
progression of collaborative arrangements and contract research as well as the
availability of other financings. There can be no assurance that these funds
will be available on acceptable terms, if at all.
Our future capital requirements will depend on many factors, including
continued scientific progress in our research and development programs, the size
and complexity of these programs, the scope and results of clinical trials, the
time and costs involved in applying for any regulatory approvals, the costs
involved in preparing, filing, prosecuting, maintaining and enforcing patent
claims, competing technological and market developments, ability to establish
and maintain collaborative relationships or raise additional equity financing,
and the cost of manufacturing scale-up and effective commercialization
activities and arrangements. We expect to incur significant net operating losses
each year for at least the next several years as we expand our current research
and development programs, including clinical trials and manufacturing scale-up
activities, and increase our general and administrative expenses to support a
larger, more complex organization. It is possible that our cash requirements
will exceed current projections and that we will therefore need additional
financing sooner than currently expected.
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We have no current means of generating cash flow from operations. Our
lead drug candidate, LJP 394, will not generate revenues, if at all, until it
has been proven safe and effective, has received regulatory approval and has
been successfully commercialized, a process that is expected to take at least
the next several years. Our other drug candidates are at earlier stages of
development than LJP 394. There can be no assurance that our product development
efforts with respect to LJP 394 or any other drug candidate will be successfully
completed, that required regulatory approvals will be obtained, or that any
product, if introduced, will be successfully marketed or achieve commercial
acceptance. Accordingly, we must continue to rely upon outside sources of
financing to meet our capital needs for the foreseeable future.
We anticipate increasing expenditures on the clinical trials and
manufacturing scale-up activities as well as the development of other drug
candidates and, over time, our consumption of cash will necessitate obtaining
additional sources of financing. Furthermore, we have no internal sources of
liquidity, and termination of the Abbott arrangement has ended what was our
principal means of generating cash from operations.
We will continue to seek capital through any appropriate means,
including issuance of our securities and establishment of additional
collaborative arrangements. However, there can be no assurance that additional
financing will be available on acceptable terms and our negotiating position in
our capital-raising efforts may worsen as we continue to use our existing
resources. There is no assurance that we will be able to enter into further
collaborative relationships.
IMPACT OF YEAR 2000
As a result of our planning and implementation efforts for the year
2000, we have experienced no significant disruptions in our mission critical
information technology and non-information technology systems and we believe
those systems successfully responded to the Year 2000 date change. We are not
aware of any material problems resulting from Year 2000 issues, either with our
internal systems, or the products and services of third parties. We will
continue to monitor our mission critical computer applications and those of our
suppliers and vendors throughout the year 2000 to ensure that any latent Year
2000 matters that may arise are addressed promptly.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We invest our excess cash in interest-bearing investment-grade
securities that we hold for the duration of the term of the respective
instrument. We do not utilize derivative financial instruments, derivative
commodity instruments or other market-risk-sensitive instruments, positions or
transactions in any material fashion. Accordingly, we believe that, while the
investment-grade securities we hold are subject to changes in the financial
standing of the issuer of such securities, we are not subject to any material
risks arising from changes in interest rates, foreign currency exchange rates,
commodity prices or other market changes that affect market-risk-sensitive
instruments.
PART II. OTHER INFORMATION
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
On July 24, 2000, we completed a series of private transactions in which
we issued a total of 4,800,000 shares of our common stock to private investors
for an aggregate price of $29.4 million. The sale was a privately negotiated
sale to accredited investors as defined in Rule 501(a) of Regulation D
promulgated under the Securities Act of 1933, as amended (the "Act"). The shares
were sold without registration under the Act in reliance on Rule 506. The sale
was made for the purpose of financing our research and development activities,
including clinical trials and preclinical testing of our product
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candidates, and for working capital and general corporate purposes. We intend to
file a registration statement covering the resale of these shares on Form S-3,
on or around August 4, 2000.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Annual Meeting of Stockholders was held on May 11, 2000. All of the
Company's directors nominated for election as stated in the Company's Proxy
Statement were elected as follows:
<TABLE>
<CAPTION>
DIRECTOR NOMINEE TERM VOTES IN FAVOR VOTES WITHHELD
-----------------------------------------------------------------------------------------
<S> <C> <C> <C>
Thomas H. Adams, Ph.D. Three years 20,006,263 588,213
-----------------------------------------------------------------------------------------
Steven B. Engle Three years 20,006,343 588,133
-----------------------------------------------------------------------------------------
</TABLE>
All of the Company's proposals as stated in the Company's Proxy
Statement were approved as follows:
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------
PROPOSAL DESCRIPTION VOTES IN FAVOR VOTES AGAINST ABSTAINING
----------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Amendment to the 1994 Stock Incentive Plan to
increase by 1,000,000 the number of shares of
the Company's Common Stock available under the
Plan 10,467,700 2,662,193 20,740
----------------------------------------------------------------------------------------------------
Amendment to the 1994 Stock Incentive Plan to
increase the annual limit on the number of
shares available under certain awards granted
to a participant to 400,000 9,350,719 1,770,199 2,029,715
----------------------------------------------------------------------------------------------------
Amendment to the 1995 Employee Stock Purchase
Plan to increase by 200,000 the number of
shares of the Company's Common Stock available
under the Plan. 11,452,709 1,665,784 32,140
----------------------------------------------------------------------------------------------------
</TABLE>
ITEM 5. RISK FACTORS
We are updating and restating the risk factors included in our 1999 Form
10-K as follows, and in particular we are updating the following risk factors:
"Our drug candidates may not perform well in clinical trials and we may not be
permitted to conduct further clinical trials. Without successful clinical
trials, we will not be able to market or sell any products."
"We have a history of losses and may not become profitable."
"Our success depends significantly upon our ability to obtain patent protection
for our therapeutic approach, LJP 394, and any other developed products. In
addition, we will need to successfully preserve our trade secrets and operate
without infringing on the rights of others."
"Potential adverse effects of shares eligible for future sale."
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CERTAIN RISK FACTORS
I. RISK FACTORS RELATED TO THE INDUSTRY IN WHICH WE OPERATE.
Our success depends partially on healthcare reimbursement policies.
The continuing efforts of government and healthcare insurance companies
to reduce the costs of healthcare may negatively impact our business. For
example, in certain foreign markets, pricing and profitability of prescription
pharmaceuticals are subject to government control. In the United States, we
expect that there will continue to be a number of federal and state proposals to
implement similar government controls. In addition, increasing emphasis on
managed care in the United States will continue to put pressure on
pharmaceutical pricing. Cost control initiatives could decrease the revenue that
we receive for any products we may develop and sell in the future and negatively
impact our business. These cost control measures may also impact our commercial
partners and our ability to continue to work with these partners.
Our business depends in part on the reimbursement policies of Medicare and
healthcare companies. These policies can be unpredictable.
Newly approved drugs may not be accepted for reimbursement by health
insurers or Medicare. It is possible that these organizations will not offer
coverage for our products. Government and other third-party payors increasingly
attempt to contain healthcare costs by limiting both coverage and the level of
reimbursement for new therapeutic products. If adequate coverage and
reimbursement levels are not provided by government and other third-party payors
for our products, the market acceptance of these products would be adversely
affected.
Our industry has numerous other companies that compete with LJP and we face
rapid technological change from within our industry.
The biotechnology and pharmaceutical industries are subject to rapid
technological change. Competition from domestic and foreign biotechnology
companies, large pharmaceutical companies and other institutions is intense and
is expected to increase. A number of companies and institutions are pursuing the
development of pharmaceuticals in our targeted areas. These include companies
that are conducting clinical trials and preclinical studies for the treatment of
lupus. Our competitors may develop or obtain regulatory approval for products
more rapidly than we do, or develop and market technologies and products that
are more effective than those being developed by us or that would render our
technology and proposed products obsolete or noncompetitive.
II. RISK FACTORS RELATING TO LA JOLLA PHARMACEUTICAL PARTICULARLY.
Our drug candidates may not perform well in clinical trials and we may not be
permitted to conduct further clinical trials. Without successful clinical
trials, we will not be able to market or sell any products.
We must demonstrate in clinical trials that LJP 394, our only drug
candidate that has advanced to the clinical trial stage, is safe and effective
for use before we apply for any regulatory approvals. We announced on May 12,
1999 that Abbott Laboratories ("Abbott") and the Company, in discussion with the
FDA, elected to stop the enrollment and treatment of the more than 200 patients
enrolled in the jointly conducted Phase II/III clinical trial of LJP 394 until
the data could be validated and analyzed. This announcement was made following a
planned interim analysis of the Phase II/III clinical trial in which an
independent data monitoring committee reported lower than expected efficacy. No
major safety concerns were observed, and patients receiving LJP 394 appeared to
have a reduction in circulating antibodies to double-stranded DNA that are
associated with lupus nephritis.
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<PAGE> 13
On May 2, 2000, we announced that we had recently met with the FDA to
discuss the results of our analysis of the suspended Phase II/III trial and
that, because the results of the meeting were positive, we plan to conduct Phase
III of the trial in the second half of 2000. On May 3, 2000, we announced that
we had completed our affinity analysis of more than 99% of the North American
patients' samples. The analysis revealed that 89% of the patients had high-
affinity antibodies to LJP 394. With these additional patients, the statistical
significance of the clinical trial results for the high-affinity subpopulation
was increased.
If LJP 394 is ultimately not found to be safe and effective, we would be
unable to obtain regulatory approval for its commercialization. If that were to
occur, there is no assurance that we would be able to develop an alternative
drug candidate. Because LJP 394 is our only drug candidate that has advanced to
clinical trials, our inability to commercialize it would have a material adverse
effect on our business, financial condition and results of operation.
Our products are in the early stage of development and the technology underlying
our products is uncertain and unproven.
All of our product development efforts are based on unproven
technologies and therapeutic approaches that have not been widely tested or
used. LJP 394 has not been proven to be effective in humans and its tolerance
technology has been used only in our preclinical tests and clinical trials.
Application of LJP 394's tolerance technology to antibody-mediated diseases
other than lupus is in even earlier research stages.
LJP 394 and our other potential drug candidates require significant
additional research and development and are subject to significant risks. For
example, potential products that appear to be promising at early stages of
development may be ineffective or cause harmful side effects during preclinical
testing or clinical trials, not receive necessary regulatory approvals, be
difficult to manufacture, be uneconomical to produce, not be accepted by
consumers, or be precluded from commercialization by the proprietary rights of
others. We may not successfully complete development of LJP 394 or any other
drug candidate or may not obtain required regulatory approvals. If introduced,
LJP 394 or any other drug candidate may not generate sales.
Even if proven effective, our products may never reach market.
Potential products that appear to be promising at early stages of
development may nevertheless fail to reach market or become profitable for
reasons such as the following:
- products may be ineffective or cause harmful side effects during
preclinical testing or clinical trials,
- products may fail to receive necessary regulatory approvals,
- products may be difficult to manufacture,
- products may be uneconomical to produce particularly if high dosages
are required,
- products may fail to achieve market acceptance or be precluded from
commercialization because of proprietary rights of third parties, and
- competitors may develop superior products.
There can be no assurance that our product development efforts with
respect to LJP 394 or any other drug candidate will be successfully completed,
that required regulatory approvals will be obtained, or that any product, if
introduced, will be successfully marketed or achieve commercial acceptance.
The technology underlying LJP 394 appears effective in humans. However,
no therapeutic products have been developed to date that utilize this
technology. There can be no assurance that LJP 394 will work as intended.
Furthermore, clinical trials of LJP 394 may be viewed as a test of the Company's
entire Tolerance Technology approach. If the data from these clinical trials
indicate that LJP 394
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<PAGE> 14
is ineffective, the applicability of our Tolerance Technology to other
antibody-mediated diseases will be highly uncertain. Therefore, there is
significant risk that our therapeutic approaches will not prove to be
successful, and there can be no assurance that our drug discovery technologies
will result in any commercially successful products.
We have a history of losses and may not become profitable.
We have incurred operating losses each year since our inception in 1989
and had an accumulated deficit of approximately $77.6 million as of June 30,
2000. Our losses are likely to exceed those experienced in prior years due to
the termination of the Abbott collaborative relationship, unless we are
successful in establishing additional collaborative relationships to help
finance our research and development costs. To achieve profitability we must,
among other things, complete the development of our products, obtain all
necessary regulatory approvals and establish commercial manufacturing and
marketing capabilities. We expect to incur significant losses each year for at
least the next several years as our clinical trial, research, development and
manufacturing scale-up activities increase. The amount of losses and the time
required by us to reach sustained profitability are highly uncertain, and we do
not expect to generate revenues from the sale of products, if any, for at least
several years. We may never achieve product revenues or profitability.
We will need additional funds to support operations and may need to reduce
operations, sell stock or assets, or merge with another entity to continue
operations.
Our operations to date have consumed substantial capital resources, and
we will continue to expend substantial and increasing amounts of capital for
research, product development, preclinical testing and clinical trials of drug
candidates, to establish commercial-scale manufacturing capabilities, and to
market potential products.
Our future capital requirements will depend on many factors, including:
- continued scientific progress in our research and development
programs and the size and complexity of these programs,
- the scope and results of preclinical testing and clinical trials,
- the time and costs involved in applying for regulatory approvals,
- the costs involved in preparing, filing, prosecuting, maintaining and
enforcing patent claims,
- competing technological and market developments,
- our ability to establish and maintain collaborative research and
development arrangements, and
- the cost of manufacturing scale-up and effective commercialization
activities and arrangements.
We expect to incur substantial and increasing losses each year for at
least the next several years as our clinical trial, research, development and
manufacturing scale-up activities increase. We expect our existing capital
resources (including the capital raised through our July 2000 sale of 4,800,000
shares of common stock) to be sufficient to fund our activities, as currently
planned, for approximately the next 24 months. However, the amounts expended by
the Company for various purposes may vary significantly, and it is possible that
our cash requirements will exceed current projections and that we will therefore
need additional financing sooner than currently expected. In the future, it is
possible that we will not have adequate resources to support our business
activities.
We actively seek additional funding, including through collaborative
arrangements and public and private financings. Our choice of financing
alternatives may vary from time to time depending upon
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<PAGE> 15
various factors, including the market price of our securities, conditions in the
financial markets, and the interest of other entities in strategic transactions
with LJP. There can be no assurance that additional financing will be available
on acceptable terms, if at all, whether through collaborative arrangement,
issuance of securities, or otherwise. If adequate funds are not available, we
may be required to delay, scale back or eliminate one or more of our research
and development programs or obtain funds through arrangements with collaborative
partners or others that require us to relinquish rights to certain technologies
or potential products. This could have a negative impact on our business.
We may need to establish collaborative agreements.
We may seek to collaborate with pharmaceutical companies to access their
research, drug development, manufacturing, marketing and financial resources. In
December 1996, we entered into a collaborative agreement with Abbott. This
agreement granted Abbott the exclusive right to market and sell LJP 394
throughout the world in exchange for royalties on sales, development financing,
and milestone payments. Abbott's obligations to make payments to us and to
conduct development activities were conditioned on the progress of clinical
trials and the attainment of milestones related to regulatory approvals and
sales levels. Following the May 1999 suspension of the jointly conducted Phase
II/III clinical trial, Abbott and LJP terminated their collaborative agreement
in September 1999.
We may pursue collaborative arrangements with other pharmaceutical
companies to assist in our research programs and the clinical development and
commercialization of our other drug candidates. However, we may not be able to
negotiate arrangements with any other collaborative partners on acceptable
terms, if at all. Any additional collaborative relationships that we enter into
may include conditions comparable to those in the Abbott agreement. Once a
collaborative arrangement is established, the collaborative partner may not
continue funding any particular program or may pursue alternative technologies
or develop alternative drug candidates, either alone or with others, to develop
treatments for the diseases we are targeting. Competing products, developed by a
collaborative partner or to which a collaborative partner has rights, may result
in the collaborative partner withdrawing support as to all or a portion of our
technology.
Without collaborative arrangements, we must fund our own research and
development activities, accelerating the depletion of our capital and requiring
us to develop our own marketing capabilities. Therefore, if we are unable to
establish and maintain collaborative arrangements, we could experience a
material adverse effect on our business, financial condition and results of
operations.
If LJP 394 fails in clinical trials, we will be unable to obtain FDA approval
and will not be able to sell those products.
In order to sell our products that are under development, we must first
receive regulatory approval. To obtain those approvals, we must conduct clinical
studies demonstrating that our products are safe and effective. If we cannot
obtain FDA approval for LJP 394, currently our sole drug candidate, our business
will be significantly impacted and our prospects for profitable sales will
significantly decrease.
Although LJP 394 appears promising, it may not be successful in future
clinical trials. Our prior clinical study of LJP 394, in collaboration with
Abbott, was halted, and the anticipated Phase III clinical study may also be
delayed or halted for various reasons, including:
- the product is not effective, or physicians think that it is not
effective,
- patients experience severe side effects during treatment,
- patients do not enroll in the study at the rate we expect, or
- product supplies are not sufficient to treat the patients in the
study.
In addition, the FDA and foreign regulatory authorities have substantial
discretion in the approval process. The FDA and foreign regulatory authorities
may not agree that we have demonstrated that LJP 394 is safe and effective after
we complete clinical trials. Even if the results of prior clinical trials are
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<PAGE> 16
positive, the FDA may require us to design and conduct additional studies, which
may result in significant expense and delay. The FDA may require new clinical
trials because of inconclusive results from earlier trials, a possible failure
to conduct prior trials in complete adherence to FDA good clinical practice
standards, and identification of new clinical trial endpoints.
Our success depends significantly upon our ability to obtain patent protection
for our therapeutic approach, LJP 394, and any other developed products. In
addition, we will need to successfully preserve our trade secrets and operate
without infringing on the rights of others.
We own 86 issued patents and 59 pending patent applications covering
various technologies and drug candidates. However, there can be no assurance
that any additional patents will be issued, or that the scope of any patent
protection will be sufficient, or that any current or future issued patent will
be held valid if subsequently challenged. There is a substantial backlog of
biotechnology patent applications at the U.S. Patent and Trademark Office that
may delay the review and issuance of any patents. The patent position of
biotechnology firms like ours generally is highly uncertain and involves complex
legal and factual questions, and no consistent policy has emerged regarding the
breadth of claims covered in biotechnology patents or protection afforded by
these patents. Presently, we have a number of patent applications pending in the
United States relating to our technology, as well as foreign counterparts to
some of our U.S. patent applications. We intend to continue to file applications
as appropriate for patents covering both our products and processes. There can
be no assurance that patents will be issued from any of these applications, or
that the scope of any issued patents will protect our technology.
We are aware of one U.S. patent grant that contains claims covering subject
matter that may conflict with some of our key patents and patent applications,
and that may affect our ability to develop and sell our products. Any conflict
between our patents and patent applications, and patents or patent applications
of third parties, could result in a significant reduction of the coverage of our
existing patents or any future patents that may be issued. In addition, we may
have to incur significant expenses in defending our patents. If the U.S. Patent
and Trademark Office or any foreign counterpart issues to a competitor patents
containing competitive or conflicting claims, and if these claims are valid,
there can be no assurance that we would be able to obtain licenses to these
patents, that any licensing fees would be reasonable, or that we would be able
to develop or obtain alternative technology. Patent applications in the United
States are kept secret until a patent is issued. As a result, we do not know if
others, including competitors, have filed patent applications for technology
covered by our pending applications, nor can we be certain that we were the
first to invent or to file patent applications for our technologies. Competitors
may have patents or patent applications pending that relate to compounds or
processes that overlap or compete with our intellectual property.
We also rely on unpatented intellectual property such as trade secrets
and improvements, know-how, and continuing technological innovation. While we
seek to protect these rights, it is possible that: (i) inventions relevant to
our business will be developed by a person not bound by an LJP invention
assignment agreement, (ii) binding LJP confidentiality agreements will be
breached and we will not have adequate remedies for such a breach, or (iii) our
trade secrets will otherwise become known or be independently discovered by
competitors. We could incur substantial costs in defending suits brought against
the Company by others for infringement of intellectual property rights or in
prosecuting suits that we might bring against others to protect our intellectual
property rights.
We currently have only limited manufacturing capabilities.
The manufacture of our potential products for clinical trials and the
manufacture of any resulting products for commercial purposes are subject to
certain FDA standards. While we are producing limited quantities of LJP 394 for
clinical trials, our current facilities are not FDA approved for commercial
production of our potential products. Substantial capital investment in the
expansion and build-out of our manufacturing facilities will be required to
enable manufacture of any products in commercial quantities. While we have
initiated the process of obtaining FDA approval for our facilities, we have
never operated an FDA-approved manufacturing facility and may not obtain
necessary approvals. We have limited manufacturing experience, and we may be
unable to successfully transition to commercial production. We may enter into
arrangements with contract manufacturing companies to expand our own production
capacity in order to meet requirements for our products, or to attempt to
improve manufacturing efficiency.
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<PAGE> 17
If we choose to contract for manufacturing services and encounter delays or
difficulties in establishing relationships with manufacturers to produce,
package and distribute our finished products, the clinical trials, market
introduction and subsequent sales of these products would be adversely affected.
If we become dependent on third parties for the manufacture of our products, our
profit margins and our ability to develop and deliver products on a timely and
competitive basis may be adversely affected.
We lack experience in marketing products for commercial sale.
In order to commercialize any drug candidate approved by the FDA, we
must either develop a marketing and sales force or enter into marketing
arrangements with others. We currently have no marketing arrangements with
others, and there can be no assurance that we will be able to enter into any
marketing agreements on favorable terms, or that any such agreements will result
in payments to LJP. To the extent that we enter into co-promotion or other
marketing and sales arrangements with other companies, any revenues that we may
receive will be dependent on the efforts of others. There can be no assurance
that these efforts will be successful. If we attempt to develop our own
marketing and sales capabilities, we will compete with other companies that have
experienced and well-funded marketing and sales operations. Furthermore, if we
attempt to establish sales and distribution capabilities, we may experience
delays and expenditures and have difficulty in gaining market acceptance for our
drug candidates.
The use of LJP 394 and other potential products in clinical trials, and the sale
of any approved products may expose us to liability claims resulting from the
use of these products.
We have not received marketing approval from the FDA for any drug
candidates and we currently use LJP 394 only in clinical trials. The use and
possible sale of LJP 394 and other potential products may expose us to legal
liability and generate negative publicity. These claims might be made directly
by consumers, pharmaceutical companies, or others. We maintain $10.0 million of
product liability insurance for claims arising from the use of LJP products in
clinical trials. However, coverage is becoming increasingly expensive, and there
can be no assurance that we will be able to maintain insurance or that insurance
can be acquired at a reasonable cost or in sufficient amounts to protect us
against possible losses. Furthermore, it is possible that our financial
resources would be insufficient to satisfy potential product liability claims. A
successful product liability claim or series of claims brought could negatively
impact our business and financial condition.
Our research and development and operations depend in part on certain key
employees and consultants. Losing these employees or consultants would
negatively impact our product development and operations.
We are highly dependent upon the principal members of our scientific and
management staff, the loss of whose services would delay the achievement of our
research and development objectives. Our anticipated growth and expansion into
areas requiring additional expertise, such as clinical trials, government
approvals, manufacturing, and marketing, is expected to place increased demands
on our resources and require the addition of new management personnel as well as
the development of additional expertise by existing management personnel.
Retaining our current key employees and recruiting additional qualified
scientific personnel to perform research and development work in the future will
also be critical to our success. Because competition for experienced scientists
among numerous pharmaceutical and biotechnology companies and research and
academic institutions is intense, we may not be able to attract and retain these
people. In addition, we rely upon consultants and advisors to assist us in
formulating our research and development, clinical, regulatory and manufacturing
strategies. All of our consultants and advisors are employed outside the Company
and may have commitments or consulting or advisory contracts with other entities
that may affect their ability to contribute to our business.
It is possible that we may face environmental liabilities related to certain
hazardous materials used in our operations.
Due to the nature of our manufacturing processes, we are subject to
stringent federal, state and local laws, rules, regulations and policies
governing the use, generation, manufacture, storage, emission, discharge,
handling and disposal of certain materials and wastes. It is possible that we
may have to incur significant costs to comply with environmental regulations as
manufacturing is increased to commercial
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volumes. Our operations may be significantly impacted by current or future
environmental laws, rules, regulations and policies or by any releases or
discharges of hazardous materials. In our research activities, we utilize
radioactive and other materials that could be hazardous to human health, safety,
or the environment. These materials and various wastes resulting from their use
are stored at our facility pending ultimate use and disposal. The risk of
accidental injury or contamination from these materials cannot be eliminated. In
the event of such an accident, we could be held liable for any resulting
damages, and any such liability could exceed our resources.
III. RISK FACTORS RELATED SPECIFICALLY TO OUR STOCK.
Our common stock price has historically been very volatile.
The market prices for securities of biotechnology and pharmaceutical
companies, including ours, have historically been highly volatile, and the
market has from time to time experienced significant price and volume
fluctuations that are unrelated to the operating performance of particular
companies. Factors such as the following can have a negative effect on the
market price of our securities:
- announcements of technological innovations or new therapeutic
products by LJP or others,
- clinical trial results,
- developments concerning agreements with collaborators,
- government regulation,
- developments in patent or other proprietary rights,
- public concern as to the safety of drugs discovered or developed by
LJP or others,
- future sales of substantial amounts of our common stock by existing
stockholders, and
- comments by securities analysts and general market conditions.
The realization of any of the risks described in these "Risk Factors"
could have an adverse effect on the market price of our common stock.
In the future, our stock may be removed from listing on the Nasdaq quotation
system and may not qualify for listing on any stock exchange.
Currently our securities are traded on the Nasdaq National Market.
Nasdaq has certain continued listing requirements, including a minimum trading
price. Previously, we have received notice from Nasdaq that our stock price fell
below this minimum trading price. While we have since come back into compliance
with this Nasdaq requirement, it is possible that we will fall out of compliance
with this and/or other Nasdaq continued listing criteria at some point in the
future. Failure to comply with any one of several Nasdaq requirements may cause
our stock to be removed from listing on Nasdaq. Should this happen, we may not
be able to secure listing on other exchanges or quotation systems. This would
have a negative effect on the price and liquidity of our stock.
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<PAGE> 19
Potential adverse effects of shares eligible for future sale.
Sales of our common stock in the public market, or the perception that
such sales could occur, could negatively impact the market price of our
securities and impair our ability to complete equity financings. We are unable
to estimate the number of shares of common stock that may actually be resold in
the public market since this will depend upon the market price for the common
stock, the individual circumstances of the sellers and other factors. We also
have a number of institutional stockholders that own significant blocks of our
common stock. If these stockholders sell large portions of their holdings in a
relatively short time, for liquidity or other reasons, the prevailing market
price of our common stock could be negatively affected.
Certain anti-takeover plans and statutes may prevent hostile takeovers or
prevent or delay the change in control within the Company.
There are certain anti-takeover devices in place that may discourage or
deter a potential acquirer from attempting to gain control of us. Certain
provisions of the Delaware General Corporation Law may have the effect of
deterring hostile takeovers or delaying or preventing changes in the control or
management of us, including transactions in which stockholders might otherwise
receive a premium for their shares over then-current market prices.
We may also issue shares of preferred stock without stockholder approval
and upon such terms as our Board of Directors may determine. The issuance of
preferred stock could have the effect of making it more difficult for a third
party to acquire a majority of our outstanding stock, and the holders of such
preferred stock could have voting, dividend, liquidation and other rights
superior to those of holders of the common stock. In 1998, we designated 75,000
shares of preferred stock as Series A Junior Participating Preferred Stock in
connection with our Rights Plan. The Rights Plan could cause an unapproved
takeover to be much more expensive to an acquirer, resulting in a strong
incentive to negotiate with our Board of Directors.
Our certificate of incorporation provides for a board of directors that
is separated into three classes, with their respective terms in office staggered
over three year periods. This has the effect of delaying a change in control of
the Board of Directors without the cooperation of the incumbent board. In
addition, our bylaws do not allow stockholders to call a special meeting of
stockholders, require stockholders to give written notice of any proposal or
director nomination to us within a certain period of time prior to the
stockholder annual meeting, and establish certain qualifications for a person to
be elected or appointed to the Board of Directors during the pendency of certain
business combination transactions.
Absence of dividends.
We have not paid any cash dividends since our inception and do not
anticipate paying any cash dividends in the foreseeable future.
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ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBITS
<TABLE>
<CAPTION>
Exhibit
Number Description
-------- -----------
<S> <C>
3.1 Intentionally omitted
3.2 Amended and Restated Bylaws of the Company (1)
3.3 Amended and Restated Certificate of Incorporation of the Company (1)
4.0 Rights Agreement dated as of December 3, 1998 between the Company and
American Stock Transfer & Trust Company (2)
4.1 Certificate of Designation, Preferences and Rights of Series A Junior
Participating Preferred Stock of the Company (3)
27 Financial Data Schedule (4)
</TABLE>
(1) Previously filed with the Company's quarterly report on Form 10-Q for
the quarter ended September 30, 1999 and incorporated by reference
herein.
(2) Previously filed with the Company's Registration Statement on Form 8-A
(No. 000-24274) as filed with the Securities and Exchange Commission on
December 4, 1998 and incorporated by reference herein.
(3) Previously filed with the Company's quarterly report on Form 10-Q for
the quarter ended June 30, 1999 and incorporated by reference herein.
(4) Filed herein.
(b) REPORTS ON FORM 8-K
As reported in our Form 10-Q for March 31, 2000, on April 18,
2000, the Company filed a Current Report on Form 8-K reporting
the following: La Jolla Pharmaceutical Company intends to file a
registration statement to register for resale the underlying
shares of Company common stock for the Company's privately held
warrants.
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<PAGE> 21
LA JOLLA PHARMACEUTICAL COMPANY
SIGNATURES
JUNE 30, 2000
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
La Jolla Pharmaceutical Company
Date: August 3, 2000 By: /s/ Steven B. Engle
-------------------------------------
Steven B. Engle
Chairman and
Chief Executive Officer
Signed on behalf of the Registrant
By: /s/ Gail A. Sloan
---------------------------------
Gail A. Sloan
Signed as Principal Accounting
Officer
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<PAGE> 22
LA JOLLA PHARMACEUTICAL COMPANY
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Sequentially
Exhibit Numbered
Number Exhibit Page
------ ------- ------------
<S> <C> <C>
27 Financial Data Schedule
</TABLE>
22
