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PROSPECTUS
This filing is made pursuant
to Rule 424(b)(3) under
the Securities Act of
1933 in connection with
Registration No. 333-43066
[LJPC LOGO]
4,800,000 Shares
Common Stock
This prospectus relates to 4,800,000 shares of our common stock that
may be sold from time to time by the selling stockholders named in this
prospectus. The selling stockholders acquired these shares of our common stock
in private transactions.
This offering is not being underwritten. The selling stockholders may
offer the shares through public or private transactions at the market price for
our common stock at the time of the sale, a price related to the market price, a
negotiated price or such other prices as the selling stockholders determine from
time to time. See "Plan of Distribution" on page 11.
All of the net proceeds from the sale of these shares of common stock
will go to the selling stockholders. We will not receive any proceeds from sales
of these shares.
Our common stock is traded on the Nasdaq National Market under the
symbol "LJPC." On September 25, 2000, the last reported sale price of our common
stock was $8.75 per share.
You should read this prospectus carefully before you invest.
Investing in our common stock involves substantial risks. See "Risk
Factors" beginning on page 2.
----------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The information in this prospectus is not complete and may be changed.
These securities will not be sold until the registration statement filed with
the Securities and Exchange Commission is effective. This prospectus is not an
offer to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
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The date of this prospectus is September 27, 2000
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LA JOLLA PHARMACEUTICAL COMPANY
La Jolla Pharmaceutical Company is a biopharmaceutical company focused
on the research and development of therapeutic products for the treatment of
some life-threatening antibody-mediated diseases. Antibody-mediated diseases are
the result of a malfunction of the body's immune system, in which cells in the
immune system produce disease-causing antibodies. These diseases include
autoimmune conditions such as lupus and antibody-mediated stroke. Current
treatments for these autoimmune disorders target the symptoms of the disease or
generally suppress the normal operation of the immune system, frequently
resulting in severe negative side effects and hospitalization. Our drug
candidates are designed to treat the underlying cause of many antibody-mediated
diseases without these side effects. Our clinical drug candidate is known as
LJP 394, a lupus treatment drug.
We are registering for resale a total of up to 4,800,000 shares of our
common stock previously sold by us to investors in private transactions. These
investors are identified in the section headed "Selling Stockholders." We will
not receive any of the proceeds for the resale of these shares.
We are incorporated in the State of Delaware. Our principal executive
offices are located at 6455 Nancy Ridge Drive, San Diego, California 92121 and
our telephone number is (858) 452-6600.
RISK FACTORS
An investment in our common stock involves a high degree of risk. You
should carefully consider the following risk factors related to our common stock
offered by this prospectus and to our business and operations. You should also
carefully consider the other information in this prospectus and in the documents
incorporated by reference. Some of these factors have affected our financial
condition and operating results in the past or are currently affecting us. All
of these factors could affect our future financial condition or operating
results. If any of the following risks actually occurs, our business could be
harmed. If that happens, the trading price of our common stock could decline,
and you may lose all or part of your investment.
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I. RISK FACTORS RELATING TO LA JOLLA PHARMACEUTICAL AND THE INDUSTRY IN
WHICH WE OPERATE.
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.
If LJP 394 is ultimately not found to be safe and effective, we would
be unable to obtain regulatory approval for its commercialization. Because LJP
394 is our only drug candidate that has advanced to clinical trials, and because
there is no guarantee that we would be able to develop an alternate drug
candidate, our inability to commercialize LJP 394 would have a severe negative
effect on our business, including revenues and profits.
In order to sell our products that are under development, we must first
receive regulatory approval. To obtain regulatory approval, we must conduct
clinical studies demonstrating that our products are safe and effective.
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 forthcoming Phase III clinical study may also be delayed or
halted for various reasons, including:
o the product is not effective, or physicians think that it is not
effective,
o patients experience severe side effects during treatment,
o patients do not enroll in the study at the rate we expect, or
o 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 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
clinical trials, a possible failure to conduct prior clinical trials in complete
adherence to FDA good clinical practice standards and identification of new
clinical trial endpoints.
Our products are in the early stage of development and the technology underlying
our products is uncertain and unproven. If our products cannot be successfully
developed, we will never be able to generate meaningful sales.
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 the technology
on which it is based has been used only in our preclinical tests and clinical
trials. If our products or technology is not effective, we will not generate
meaningful sales. Application of LJP 394's 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.
Potential products that appear to be promising at early stages of development
may nevertheless fail to reach market or become profitable for some of the
following reasons:
o products may be ineffective or cause harmful side effects during
preclinical testing or clinical trials,
o products may fail to receive necessary regulatory approvals,
o products may be difficult to manufacture,
o products may be uneconomical to produce particularly if high dosages
are required,
o products may fail to achieve market acceptance,
o products may be precluded from commercialization because of
proprietary rights of third parties, and
o competitors may develop superior products.
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The technology underlying LJP 394 appears effective in humans. However,
no products have been developed to date that use our technology. There is no
guarantee that LJP 394 will work as intended. Furthermore, clinical trials of
LJP 394 may be viewed as a test of LJPC's entire approach to developing
therapies for antibody-mediated diseases. If the data from our clinical trials
indicates that LJP 394 is ineffective, the applicability of our 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 guarantee that our drug discovery technologies
will result in any commercially successful products.
Our success in developing our products and marketing them successfully depends
significantly upon our ability to obtain patent protection for 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 will depend on patents and other unpatented intellectual property to
prevent others from profiting from products or technologies that we may have
developed, and to preserve our freedom to operate our business. 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. This
could have a negative effect on our ability to prevent competitors from
profiting from our products and technologies, and this could affect our future
sales. 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 or has issued to a competitor patents containing competitive or
conflicting claims, and if these claims are valid, there can be no guarantee
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:
o inventions relevant to our business will be developed by a person
not bound by an LJPC invention assignment agreement,
o binding LJPC confidentiality agreements will be breached and we will
not have adequate remedies for such a breach, or
o our trade secrets will otherwise become known or be independently
discovered by competitors.
We could incur substantial costs in defending suits brought against us
by others for infringement of intellectual property rights or in prosecuting
suits that we might bring against others to protect our intellectual property
rights.
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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 a collaborative relationship with Abbott, 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. We will need to raise additional funds in some way,
and if we are not able to do so we will not be able to fund our operations.
Our future capital requirements will depend on many factors, including:
o continued scientific progress in our research and development
programs and the size and complexity of these programs,
o the scope and results of preclinical testing and clinical trials,
o the time and costs involved in applying for regulatory approvals,
o the costs involved in preparing, filing, prosecuting, maintaining
and enforcing patent claims,
o competing technological and market developments,
o our ability to establish and maintain collaborative research and
development arrangements, and
o 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 the sale of stock that may be
offered for resale under this prospectus) will be sufficient to fund our
activities, as currently planned, for approximately the next 24 months. However,
the amounts expended by us 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 various factors,
including the market price of our securities, conditions in the financial
markets, and the interest of other entities in strategic transactions with LJPC.
There can be no guarantee 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 ability to
develop products, or to achieve profitability if our products are brought to
market. If we do obtain additional funding through sales of securities, your
investment in LJPC will be diluted.
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We may not earn as much income as we hope due to possible changes in healthcare
reimbursement policies.
The continuing efforts of government and healthcare insurance companies
to reduce the costs of healthcare may reduce the amount of income we can
generate from our products. For example, in certain foreign markets, pricing and
profitability of prescription drugs 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 drug manufacturers to keep prices down. Cost control initiatives
could reduce the revenue that we receive for any products we may develop and
sell in the future. These cost control measures may also affect the
profitability of companies with whom we may transact business, such as
manufacturers of our products, and thus may have a negative effect on our
ability to continue to work with these companies.
Because a number of companies compete with us and many of these competitors have
greater resources than we do, and because we face rapid changes in technology
in our industry, we cannot be certain that our products will be accepted in the
marketplace or capture market share.
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, many of which are very large, and have
financial technical, sales and distribution and other resources substantially
greater than ours. The greater resources of these competitors could enable them
to develop competing products more quickly than we are able to, and to market
any competing product more quickly so as to make it extremely difficult for us
to develop a share of the market for these products. These competitors also
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. Also, the biotechnology and
pharmaceutical industries are subject to rapid changes in technology. Our
competitors may also 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.
We may need to establish collaborative agreements, and this could have a
negative effect on our freedom to operate our business, or profit fully from
sales of our products.
We may seek to collaborate with pharmaceutical companies to gain access
to their research, drug development, manufacturing, marketing and financial
resources. However, we may not be able to negotiate arrangements with any
collaborative partners on acceptable terms, if at all. Any collaborative
relationships that we enter into may include restrictions on our freedom to
operate our business or to profit fully from the sales of our products.
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 ability to develop products and, once developed,
to market them successfully.
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Our limited manufacturing capabilities could result in shortages of products
for testing and future sale, and our revenues and profit margin could be
negatively affected.
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. 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. Substantial capital investment in the
expansion and build-out of our manufacturing facilities will be required to
enable us to manufacture 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. 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 negatively affected by the lack of available products, and our profit
margins and our ability to develop and deliver products on a timely and
competitive basis may be negatively affected.
We lack experience in marketing products for commercial sale and thus may have
difficulty gaining acceptance for our products.
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. If we cannot do either of these we may have difficulty
generating sales for our products. We currently have no marketing arrangements
with others, and there can be no guarantee that we will be able to enter into
any marketing agreements on favorable terms, or that any such agreements will
result in payments to LJPC. 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
guarantee 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 lawsuits resulting from the use of
these products.
The use and possible sale of LJP 394 and other potential products may
expose us to legal liability and generate negative publicity if claims are made
against us that people were harmed by our products. 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 LJPC
products in clinical trials. However, coverage is becoming increasingly
expensive, and there can be no guarantee 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 have
a negative effect on 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. This is because our key personnel,
including Steven Engle, Dr. Andrew Wiseman and Dr. Matthew Linnik, have been
involved in the development of LJP 394 and other drug candidates for several
years and have unique knowledge of our drug candidates and of the technology on
which they are based. 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
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among numerous pharmaceutical and biotechnology companies and research and
academic institutions is intense, we may not be able to attract and retain these
people. If we cannot attract and retain qualified people, our ability to conduct
necessary clinical trials and to develop our products may be negatively affected
because, for instance, the trials may not be conducted properly, or the trials
or our manufacturing of products may be delayed. 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 LJPC 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 governing the use, 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 our manufacturing
increases to commercial volumes. Our operations may be significantly impacted by
current or future environmental laws because, for instance, our ability to
produce products may be slowed down, which may cause our costs in producing
these products to increase. In our research activities, we use 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.
II. RISK FACTORS RELATED SPECIFICALLY TO OUR STOCK.
Our common stock price is volatile and may decline even if our business is
doing well.
The market price of our common stock has been and is likely to continue
to be highly volatile. 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. The following factors can have a significant effect on the
market price of our securities:
o announcements of technological innovations or new therapeutic
products by LJPC or others,
o clinical trial results,
o developments concerning agreements with collaborators,
o government regulation,
o developments in patent or other proprietary rights,
o public concern as to the safety of drugs discovered or developed by
LJPC or others,
o future sales of substantial amounts of our common stock by existing
stockholders, and
o comments by securities analysts and general market conditions.
The realization of any of the risks described in these "Risk Factors" could have
a negative 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, in which case it
may be difficult to find a market in our stock.
If our stock is no longer traded on a national trading market it may be
more difficult for you to sell shares that you own, and the price of the stock
may be negatively affected. 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
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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.
Future sales of our stock by existing stockholders could negatively affect the
market price of our stock and make it more difficult for us to sell stock in the
future.
Sales of our common stock in the public market, or the perception that
such sales could occur, could result in a drop in the market price of our
securities and make it more difficult for us to complete future equity
financings. In addition to the shares to be sold in this offering, LJPC has
outstanding the following shares of common stock:
o 12,570,000 shares of common stock that have been issued in
registered offerings and are freely tradable in the public markets.
o Approximately 8,900,000 shares of common stock currently eligible
for resale in the public market pursuant to SEC Rule 144.
o An additional 2,000,000 shares of common stock issued to an overseas
investor pursuant to SEC Regulation S may also be resold.
o In addition, an aggregate of 2,592,439 shares of common stock may be
issued on the exercise of stock options outstanding as of June 30,
2000 under our various stock option plans at a weighted average
exercise price of $2.73 per share.
o We have in effect or intend to file registration statements under
the Securities Act registering approximately 4,000,000 shares of
common stock reserved under our incentive stock option and employee
stock purchase plans. Approximately 184,000 shares of common stock
that may be issued on the exercise of outstanding stock options will
be available for public resale under SEC Rule 144 pursuant to Rule
701 under the Securities Act.
o Abbott has certain registration rights relating to 3,369,604 shares
of common stock that it owns.
We cannot 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 market price of our common stock could drop significantly.
Anti-takeover devices may prevent or delay changes in management of LJPC.
We have in place some anti-takeover devices, including a stockholder
rights plan, that may have the effect of delaying or preventing changes in the
management of LJPC. For example, one anti-takeover device provides for a board
of directors that is separated into three classes, with their 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.
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We may also issue shares of preferred stock without stockholder
approval and upon terms that our Board of Directors may determine in the future.
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.
We do not pay dividends and this may negatively affect the price of our stock.
We have not paid any cash dividends since our inception and do not
anticipate paying any cash dividends in the foreseeable future. The future price
of our common stock may be depressed by the fact that we have not paid
dividends.
USE OF PROCEEDS
We will not receive any proceeds from the sale of the shares of common
stock by the selling stockholders.
SELLING STOCKHOLDERS
In a series of private transactions completed on July 24, 2000, we
issued a total of 4,800,00 shares of our common stock to the stockholders listed
below. The selling stockholders may from time to time offer and sell pursuant to
this prospectus any or all of 4,800,000 shares of our common stock. The
following table describes, as of July 24, 2000, the number of shares of our
common stock that each selling stockholder beneficially owns. The term "selling
stockholders" includes the holders listed below and their transferees, pledgees,
donees or other successors. We have prepared this table based upon information
furnished to us by or on behalf of the selling stockholders.
The selling stockholders confirmed at the time they acquired the shares
listed below that they acquired the shares for investment purposes only and not
with a view toward their resale, and acknowledged the existence of restrictions
on resale that apply to these shares. This offering relates only to the sale of
shares held or to be held by the selling stockholders named in the following
table. Since the date on which they provided us with the information below, the
selling stockholders may have sold, transferred or otherwise disposed of some or
all of their shares of our common stock in transactions exempt from the
Securities Act's registration requirements.
<TABLE>
<CAPTION>
Beneficial Ownership Beneficial Ownership
Prior to Offering After Offering
-------------------------------------- -------------------------
Number Percent Shares Number Percent
of of to be of of
Name of Beneficial Owner Shares Class(1) Sold (2) Shares(2) Class(2)
------------------------ --------- -------- --------- --------- --------
<S> <C> <C> <C> <C> <C>
State of Wisconsin Investment Board 4,114,300 14.0% 1,750,000 2,364,300 8.1%
DWS Investments GmbH 2,400,000 8.2% 1,200,000 1,200,000 4.1%
Alta BioPharma Partners, LP 1,193,445 4.1% 279,714 913,731 3.1%
La Jolla Chase Partners (Alta Bio), LLC 681,571 2.3% 159,743 521,828 1.8%
Special Situations Fund III, LP 507,000 1.7% 270,000 237,000 *
HSBC Bank PLC 450,000 1.5% 450,000 -- --
Lares & Co. 350,000 1.2% 350,000 -- --
Special Situations Private Equity Fund, LP 264,100 * 200,000 64,100 *
Special Situations Cayman Fund, LP 168,900 * 90,000 78,900 *
Chase Equity Associates, LP 55,000 * 40,000 15,000 *
Alta Embarcadero BioPharma, LLC 44,984 * 10,543 34,441 *
</TABLE>
10
<PAGE> 11
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* Less than 1%
(1) Computed based on 29,288,361 shares of common stock outstanding as of
July 24, 2000.
(2) Assumes all the shares of common stock that may be offered hereunder are
sold.
The information regarding the selling stockholders may change from time
to time. If required, we will describe these changes in one or more prospectus
supplements.
PLAN OF DISTRIBUTION
The selling stockholders can use this prospectus to sell the shares at
any time while the prospectus is in effect, unless we have notified the selling
stockholders that the prospectus is not available at that particular time. The
selling stockholders will determine if, when and how they will sell the shares
they own. Any sales may occur in one or more of the following types of
transactions (including block transactions):
o transactions on the Nasdaq National Market or any other organized
market or quotation system where the shares may be traded,
o privately negotiated transactions between a selling stockholder and
a purchaser, or
o transactions effected with or through a broker-dealer acting as
either agent or principal.
These transactions may involve the transfer of the shares upon exercise
or settlement of put or call options, or the delivery of the shares to replace
shares that were previously borrowed from another stockholder or a combination
of such methods. If a broker-dealer is used in the sale of shares, that person
may solicit potential purchasers. The shares may also be transferred as a gift
or as a result of a pledge, or may be sold to a broker-dealer acting as
principal. These persons may then sell the shares to another person, either
directly or through another broker-dealer, subject to compliance with the
requirements of the Securities Act.
The price at which sales of the shares occur may be based on market
prices or may be negotiated between the parties, and the consideration may be
cash or another form negotiated between the parties. Broker-dealers acting as
agents or principals may be paid compensation in the form of discounts,
concessions or commissions from the selling stockholder and/or from the
purchasers of the shares, or both. Brokers or dealers may be deemed to be
"underwriters" within the meaning of the Securities Act. Any profits on the
resale of shares by a broker-dealer acting as principal might be deemed to be
underwriting discounts or commissions under the Securities Act. Discounts,
concessions, commissions and similar selling expenses, if any, that can be
attributed to the sale of shares will be paid by the selling stockholder and/or
the purchasers. We have agreed to pay certain of the costs, expenses and fees of
preparing, filing and maintaining this prospectus and the registration statement
of which this prospectus is a part, but we will not receive any proceeds from
sale of these shares. The selling stockholders may agree to indemnify any agent,
dealer or broker-dealer that participates in transactions involving sales of the
shares if liabilities are imposed on it under the Securities Act.
The selling stockholders have advised us that they have not entered
into any agreements, understandings or arrangements with any underwriters or
broker-dealers regarding the sale of their shares, nor is there an underwriter
or coordinating broker acting in connection with a proposed sale of shares by
any selling stockholder. If we are notified by any selling stockholder that any
material arrangement has been entered into with a broker-dealer for the sale of
shares, if required, we will file a supplement to this prospectus.
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<PAGE> 12
If the selling stockholders use this prospectus for any sale of the
shares, they will be subject to the prospectus delivery requirements of the
Securities Act. For transactions effected on or through the Nasdaq, those
requirements may be satisfied by our delivery of copies of this prospectus to
the Nasdaq in compliance with Securities Act Rule 153. Instead of using this
prospectus for any sale of the shares, a selling stockholder may resell shares
in compliance with the criteria and requirements of Securities Act Rule 144.
The anti-manipulation rules of Regulation M under the Securities
Exchange Act of 1934 may apply to sales of our common stock and activities of
the selling stockholder.
WHERE YOU CAN FIND
MORE INFORMATION
We file periodic reports, proxy statements and other information with
the Securities and Exchange Commission. You may inspect and copy these reports
and other information at the SEC's public reference facilities in Washington,
D.C. (located at 450 Fifth Street, N.W., Washington, D.C. 20549), Chicago
(located at Northwestern Atrium Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661) and New York (located at Seven World Trade Center, 13th
Floor, New York, New York 10048). You can also obtain copies of these materials
from the SEC's public reference section (located at 450 Fifth Street, N.W.,
Washington, D.C. 20549) at prescribed rates. Please call the SEC at
1-800-SEC-0300 for further information about the public reference rooms. The SEC
also maintains a site on the World Wide Web at http://www.sec.gov. This site
contains reports, proxy and information statements and other information about
registrants that file electronically with the SEC.
The SEC permits us to "incorporate by reference" the information and
reports we file with it. This means that we can disclose important information
to you by referring to another document. The information that we incorporate by
reference is considered to be part of this prospectus, and later information
that we file with the SEC automatically updates and supersedes this information.
Specifically, we incorporate by reference:
1. Our Annual Report on Form 10-K and Form 10-K/A for the fiscal year
ended December 31, 1999;
2. Our Quarterly Reports on Form 10-Q for the quarters ended March 31,
2000 and June 30, 2000;
3. Our Current Report on Form 8-K dated April 18, 2000;
4. Our Proxy Statement dated April 10, 2000;
5. The description of our common stock contained in our Registration
Statements on Form 8-A, filed on June 2, 1994 and December 4, 1998;
and
6. All documents we file with the SEC pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Exchange Act after the date of this
prospectus and prior to the termination of the offering of the
shares offered by this prospectus.
We have also filed a registration statement on Form S-3 with the SEC.
This prospectus does not contain all of the information set forth in the
registration statement. You should read the registration statement for further
information about us and our common stock.
We will provide a copy of these filings to each person, including any
beneficial owner, to whom we deliver this prospectus, upon written or oral
request. You may request a copy of these filings at no cost by writing or
telephoning us at the following address:
Corporate Secretary
La Jolla Pharmaceutical Company
6455 Nancy Ridge Drive
San Diego, California 92121
(858) 452-6600
12
<PAGE> 13
You should rely only on the information contained in this prospectus.
We have authorized no one to provide you with different information. We are not
making an offer of these securities in any state where the offer is not
permitted. You should not assume that the information in this prospectus is
accurate as of any date other than the date on the front of this prospectus.
FORWARD-LOOKING STATEMENTS
We have made forward-looking statements in this prospectus that are
based on our management's beliefs and assumptions and on information currently
available to our management. Forward-looking statements include information
concerning our possible or assumed future results of operations and statements
preceded by, followed by or that include the words "believes," "expects,"
"anticipates," "intends," "plans," "estimates" or similar expressions.
Forward-looking statements involve risks, uncertainties and
assumptions. Actual results may differ materially from those expressed in these
forward-looking statements. You are cautioned not to put undue reliance on any
forward-looking statements. Except as may be required by law, we do not have any
intention or obligation to update forward-looking statements after we distribute
this prospectus. These statements appear in a number of places in this
prospectus and include statements regarding our intentions, plans, strategies,
beliefs or current expectations and those of our directors or our officers with
respect to, among other things:
o our financial prospects,
o our financing plans,
o trends affecting our financial condition or operating results,
o our strategies for growth, operations, and product development and
commercialization, and
o conditions or trends in or factors affecting the biotechnology
industry.
You should understand that a number of factors could cause our results
to differ materially from those expressed in the forward-looking statements. The
information incorporated by reference or provided in this prospectus identifies
important factors that could cause these differences. Those factors include,
among others, the high cost and uncertainty of technology and drug development,
which can result in loss of profitability and long delays in getting products to
market.
LEGAL MATTERS
The validity of the shares of common stock covered by this prospectus
was passed upon by Gibson, Dunn & Crutcher LLP, Irvine, California.
EXPERTS
The financial statements of La Jolla Pharmaceutical Company
incorporated by reference in La Jolla Pharmaceutical Company's Annual Report
(Form 10-K/A) for the year ended December 31, 1999, have been audited by Ernst &
Young LLP, independent auditors, as set forth in their report thereon and
incorporated herein by reference. These financial statements are incorporated
herein by reference in reliance upon such report given on the authority of such
firm as experts in accounting and auditing.
13
<PAGE> 14
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NO PERSON HAS BEEN AUTHORIZED IN CONNECTION WITH ANY OFFERING MADE
UNDER THIS PROSPECTUS TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS
OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS. IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY US OR THE SELLING STOCKHOLDERS. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR
ANY SALE MADE UNDER THIS PROSPECTUS WILL, UNDER ANY CIRCUMSTANCES, IMPLY THAT
THERE HAS BEEN NO CHANGE IN OUR AFFAIRS OR THAT THE INFORMATION IN THIS
PROSPECTUS IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE AS OF WHICH THE
INFORMATION IS GIVEN. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR
THE SOLICITATION OF ANY OFFER TO BUY ANY OF THE SECURITIES OFFERED UNDER THIS
PROSPECTUS TO ANYONE IN ANY JURISDICTION IN WHICH THE OFFER OR SOLICITATION IS
NOT AUTHORIZED OR IN WHICH THE PERSON MAKING THE OFFER OR SOLICITATION IS NOT
QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO MAKE THE OFFER OR
SOLICITATION.
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TABLE OF CONTENTS
Risk Factors........................................2
Use of Proceeds....................................10
Selling Stockholders...............................10
Plan of Distribution...............................11
Where You Can Find More Information................12
Forward-Looking Statements.........................13
Legal Matters......................................13
Independent Experts................................13
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[LJPC LOGO]
4,800,000 SHARES
COMMON STOCK
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PROSPECTUS
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SEPTEMBER 27, 2000
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