<PAGE>
FILING PURSUANT TO RULE 424(B)(2)
REGISTRATION STATEMENT NO. 333-41718
PROSPECTUS SUPPLEMENT NO. 3
(TO PROSPECTUS DATED JULY 19, 2000)
131,754 SHARES
CV THERAPEUTICS, INC.
COMMON STOCK
You should read this prospectus supplement and the accompanying
prospectus carefully before you invest. Both documents contain information you
should consider carefully before making your investment decision.
INVESTING IN OUR COMMON STOCK INVOLVES CERTAIN RISKS. SEE "RISK
FACTORS" BEGINNING ON PAGE S-2 OF THIS PROSPECTUS SUPPLEMENT AND
PAGE 5 OF THE PROSPECTUS.
PLAN OF DISTRIBUTION
We are offering an aggregate of 131,754 shares of our common stock to
Acqua Wellington North American Equities Fund, Ltd. ("Acqua Wellington")
pursuant to this prospectus supplement. We have entered into a common stock
purchase agreement with Acqua Wellington pursuant to which we may, from time to
time and at our sole discretion, beginning in August 2000 and ending in December
2002, present Acqua Wellington with draw down notices constituting an offer to
purchase our common stock over a number of consecutive trading days to which we
and Acqua Wellington shall agree. Acqua Wellington will be required to purchase
a pro rata portion of shares on each day during the trading period on which the
daily volume weighted average price for our common stock exceeds a threshold
price determined by us and set forth in the draw down notice. In addition, we
may, at our sole discretion, grant Acqua Wellington an option to purchase
additional shares during such trading period. The aggregate amount Acqua
Wellington will be required to invest during any draw down period will depend on
the threshold price established by us for the draw down period.
The aggregate amount invested by Acqua Wellington pursuant to this
common stock purchase agreement will not exceed $120 million. We will issue and
sell the shares to Acqua Wellington at a per share price equal to the daily
volume weighted average price of our common stock on each date during the draw
down period on which shares are purchased, less a discount between 4.0% and
6.0%. If the daily volume weighted average price of our common stock falls below
the threshold price on any trading day during a draw down period, Acqua
Wellington may elect to purchase shares for such trading day(s) at the threshold
price, less a discount between 4.0% and 6.0%. The discount will be determined
based on our market capitalization at the start of the draw down period. We may
present Acqua Wellington with up to twenty-four (24) draw
S-1
<PAGE>
down notices during the term of the common stock purchase agreement, provided
that there are at least five (5) trading days between each draw down period.
In connection with Acqua Wellington's purchase and potential resale of
the shares covered by this prospectus supplement, we have agreed to indemnify
and hold harmless Acqua Wellington and each person who controls Acqua Wellington
against certain liabilities, including liabilities under the Securities Act,
which may be based upon, among other things, any untrue statement or alleged
untrue statement of a material fact or any omission or alleged omission of a
material fact, unless made or omitted in reliance upon written information
provided to us by Acqua Wellington.
RISK FACTORS
WE EXPECT TO CONTINUE TO OPERATE AT A LOSS AND MAY NEVER ACHIEVE PROFITABILITY.
We cannot be certain that we will ever achieve and sustain
profitability. Since our inception, we have been engaged in research and
development activities. We have generated no product revenues. As of
September 30, 2000, we had an accumulated deficit of $123.1 million. The
process of developing our products requires significant additional research
and development, preclinical testing and clinical trials, as well as
regulatory approvals. These activities, together with our general and
administrative expenses, are expected to result in operating losses for the
foreseeable future.
WE MUST SECURE ADDITIONAL FINANCING TO MEET OUR FUTURE NEEDS.
We may require substantial additional funding in order to complete our
research and development activities and commercialize any products. In the past,
we have financed our operations primarily through the sale of equity securities,
payments from our collaborators, equipment and leasehold improvement financing
and other debt financing. We have generated no product revenue, and none is
expected for at least several years. We anticipate that our existing resources
and projected interest income will enable us to maintain our current and planned
operations for at least the next 24 months. However, we may require additional
funding prior to that time.
Additional financing may not be available on acceptable terms or at
all. If we are unable to raise additional funds, we may:
- have to delay, scale back or eliminate some or all of our research
or development programs
- lose rights under existing licenses
- have to relinquish more of, or all of, our rights to product
candidates at an earlier stage of development or on less favorable
terms than we would otherwise seek
- be unable to operate as a going concern.
S-2
<PAGE>
Our future capital requirements will depend on many factors, including:
- scientific progress in our research and development programs
- the size and complexity of our programs
- the timing, scope and results of preclinical studies and clinical
trials
- our ability to establish and maintain corporate partnerships
- the time and costs involved in obtaining regulatory approvals
- the costs involved in filing, prosecuting and enforcing patent
claims
- competing technological and market developments
- the cost of manufacturing or obtaining preclinical and clinical
material.
There may be additional factors that could affect our need for
additional financing. Many of these factors are not within our control.
WE HAVE NO MANUFACTURING EXPERIENCE AND WILL DEPEND ON THIRD PARTIES TO
MANUFACTURE OUR PRODUCTS.
We do not currently operate manufacturing facilities for clinical or
commercial production of our products under development. We have no experience
in manufacturing, and we currently lack the resources or capability to
manufacture any of our products on a clinical or commercial scale. As a result,
we are dependent on corporate partners, licensees or other third parties for the
manufacturing of clinical and commercial scale quantities of our products.
For example, we have entered into an agreement with a third party
manufacturer for clinical scale production of an amount of ranolazine's active
pharmaceutical ingredient that we believe will be sufficient to support the
remainder of the Phase III clinical program. We cannot be certain that we will
be able to enter into an agreement for the commercial scale manufacture of the
active ingredient in ranolazine. If we are unable to do so, our commercial
launch of ranolazine may be delayed. We have entered into an agreement with a
third party manufacturer for clinical scale production of ranolazine tablets
sufficient to support the remainder of the Phase III clinical program and are
negotiating with them for registration and commercialization supply of
ranolazine tablets. If we are unable to negotiate an agreement to supply
ranolazine tablets for registration and commercialization, commercial launch of
ranolazine may be delayed. In addition, because we have used various
manufacturers for ranolazine in different clinical trials prior to FDA approval
of ranolazine, we will be required to demonstrate to the FDA's satisfaction the
bioequivalence of the multiple sources of ranolazine used in our clinical trials
and their bioequivalence to the product to be commercially supplied.
S-3
<PAGE>
DELAWARE LAW, PROVISIONS IN OUR CHARTER AND OUR RIGHTS PLAN COULD MAKE THE
ACQUISITION OF OUR COMPANY BY ANOTHER COMPANY MORE DIFFICULT.
Provisions of our certificate of incorporation may have the effect of
delaying or preventing changes in control or management or limit the price that
investors may be willing to pay for shares of our common stock. In addition, we
are subject to the provisions of Section 203 of the Delaware General Corporation
Law, an anti-takeover law, which could delay a merger, tender offer or proxy
contest or make a similar transaction more difficult. In addition, our board of
directors has the authority to issue up to 5,000,000 shares of preferred stock
without stockholders' approval. The rights of the holders of common stock will
be subject to, and may be affected by, the rights of the holders of any
preferred stock that may be issued 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 voting stock.
Furthermore, in February 1999, the board of directors enacted
anti-takeover provisions, including a stockholder rights plan, or "poison pill,"
and authorized severance agreements in the event of a change of control for key
executives. The board amended the stockholder rights plan in July 2000 while
maintaining it in effect.
USE OF PROCEEDS
We will use the proceeds of this offering as described in the
prospectus. See "Use of Proceeds" beginning on page 18 of the prospectus.
THE DATE OF THIS PROSPECTUS SUPPLEMENT IS NOVEMBER 8, 2000.
S-4
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the SEC. You may read and copy any document we file at
the SEC's public reference room at 450 Fifth Street, N.W., Washington, D.C.,
20549. You can request copies of these documents by contacting the SEC and
paying a fee for the copying cost. Please call the SEC at 1-800-SEC-0330 for
further information on the public reference rooms. Our SEC filings are also
available to the public from the SEC's website at www.sec.gov.
This prospectus is part of a registration statement on Form S-3,
including amendments, relating to the common stock offered by this prospectus
with the SEC. This prospectus does not contain all of the information set forth
in the registration statement, the exhibits and schedules, some portions of
which the SEC allows us to omit. Statements contained in this prospectus as to
the contents of any contract or other document referred to are not necessarily
complete and in each instance reference is made to the copy of that contract or
other document filed as an exhibit to the registration statement. For further
information about us and the common stock offered by this prospectus we refer
you to the registration statement and its exhibits and schedules which may be
obtained as described above.
The SEC allows us to "incorporate by reference" the information
contained in documents that we file with them, which means that we can disclose
important information to you by referring you to those documents. The
information incorporated by reference is considered to be part of this
prospectus. Information in this prospectus supersedes information incorporated
by reference that we filed with the SEC before the date of this prospectus,
while information that we file later with the SEC will automatically update and
supersede prior information. We incorporate by reference the documents listed
below and any future filings we will make with the SEC under Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended, prior to
the termination of the offering:
1. our Annual Report on Form 10-K for the fiscal year ended December
31, 1999;
2. our Quarterly Reports on Form 10-Q for the fiscal quarters ended
March 31, 2000, June 30, 2000 and September 30, 2000;
3. our Current Reports on Form 8-K, dated February 25, 2000, March 1,
2000 and August 16, 2000; and
4. the description of our common stock contained in our registration
statement on Form 8-A filed on October 30, 1996.
You may request copies of these filings, at no cost, by writing or
telephoning us at:
CV Therapeutics, Inc.
Attention: Investor Relations
3172 Porter Drive
Palo Alto, California 94304
Telephone (650) 812-0585
S-5
<PAGE>
MARKET FOR OUR COMMON STOCK
On November 7, 2000, the last reported sale price of our common stock
on the Nasdaq National Market was $90.50 per share. Our common stock is listed
on the Nasdaq National Market under the symbol "CVTX." The common stock sold
under this prospectus supplement will be listed on the Nasdaq National Market
after we notify the Nasdaq National Market that the shares have been issued.
As of November 7, 2000, we had 19,305,480 shares of common stock
outstanding.
GENERAL
You should rely on the information provided or incorporated by
reference in this prospectus supplement and the prospectus. We have not
authorized anyone else to provide you with different information. You should not
assume that the information in this prospectus supplement is accurate as of any
date other than the date on the front of these documents.
NEITHER THE SECURITIES EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION
HAS APPROVED OR DISAPPROVED OF THE SECURITIES OR PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
S-6
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PROSPECTUS SUPPLEMENT
<S> <C>
Plan of Distribution S-1
Risk Factors S-2
Use of Proceeds S-4
Where You Can Find More Information S-5
Market For Our Common Stock S-6
PROSPECTUS
Prospectus Summary 3
The Company 3
The Offering 4
Risk Factors 5
Forward-Looking Statements 16
Where You Can Find More Information 17
Use of Proceeds 18
Plan of Distribution 19
Legal Matters 20
Experts 20
Material Changes 20
</TABLE>
S-7
<PAGE>
PROSPECTUS
CV THERAPEUTICS, INC.
$120,000,000 AGGREGATE AMOUNT OF COMMON STOCK
This prospectus will allow us to issue common stock over time. This
means:
- we will provide a prospectus supplement each time we issue common stock;
- the prospectus supplement will inform you about the specific terms of
that offering and may also add, update or change information contained in
this document; and
- you should read this document and any prospectus supplement carefully
before you invest.
CV Therapeutics' common stock is traded on the Nasdaq National Market
under the symbol "CVTX." On July 18, 2000, the last reported sale price for our
common stock on the Nasdaq National Market was $79.8125 per share.
INVESTING IN OUR COMMON STOCK INVOLVES CERTAIN RISKS. SEE "RISK
FACTORS" BEGINNING ON PAGE 5.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THE SECURITIES OR PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this prospectus is July 19, 2000.
1
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
Prospectus Summary.......................................3
The Company..............................................3
The Offering.............................................4
Risk Factors.............................................5
Forward-Looking Statements..............................16
Where You Can Find More Information.....................17
Use of Proceeds.........................................18
Plan of Distribution....................................19
Legal Matters...........................................20
Experts.................................................20
Material Changes........................................20
</TABLE>
2
<PAGE>
PROSPECTUS SUMMARY
The following summary is qualified in its entirety by reference to the
more detailed information and consolidated financial statements appearing
elsewhere or incorporated by reference in this prospectus.
THE COMPANY
CV Therapeutics was incorporated in Delaware in December 1990, and in
June 1992 we changed our name to CV Therapeutics, Inc. Our executive offices are
located at 3172 Porter Drive, Palo Alto, California 94304, and our telephone
number is (650) 812-0585.
CV Therapeutics, Inc. and the CV Therapeutics logo are our service
marks. All other service marks and all brand names or trademarks appearing in
this prospectus are the property of their respective holders.
3
<PAGE>
THE OFFERING
<TABLE>
<S> <C>
Common stock offered in this prospectus..................... __________ shares
Common stock outstanding after the offering................. __________ shares (1)
Use of proceeds............................................. See "Use of Proceeds."
Nasdaq National Market symbol............................... CVTX
</TABLE>
(1) Based on shares outstanding as of [________]. Does not include [_______]
shares of common stock issuable upon exercise of outstanding options or
[_______] shares of common stock issuable upon exercise of outstanding
warrants as of [_______].
4
<PAGE>
RISK FACTORS
AN INVESTMENT IN THE SECURITIES OFFERED BY THIS PROSPECTUS IS VERY
RISKY. YOU SHOULD CAREFULLY CONSIDER THE FOLLOWING RISK FACTORS IN ADDITION TO
THE INFORMATION IN THE REMAINDER OF THIS PROSPECTUS BEFORE DECIDING TO PURCHASE
THE STOCK.
THESE RISKS AND UNCERTAINTIES ARE NOT THE ONLY ONES WE FACE. OTHERS
THAT WE DO NOT KNOW ABOUT NOW, OR THAT WE DO NOT NOW THINK ARE IMPORTANT, MAY
IMPAIR OUR BUSINESS OR THE TRADING PRICE OF OUR SECURITIES.
RISKS RELATED TO OUR BUSINESS
OUR PRODUCT CANDIDATES WILL TAKE AT LEAST SEVERAL YEARS TO DEVELOP, AND WE
CANNOT ASSURE YOU THAT WE WILL SUCCESSFULLY DEVELOP, MARKET AND MANUFACTURE
THESE PRODUCTS.
Since our inception in 1990, we have dedicated substantially all of our
resources to research and development. We do not have any marketed products and
we have not generated any product revenue. Because all of our potential products
are in research, preclinical or clinical development, we will not realize
product revenues for at least several years, if at all.
We have not applied for or received regulatory approval in the United
States or any foreign jurisdiction for the commercial sale of any of our
products. All of our product candidates are either in clinical trials under an
Investigational New Drug, or IND, or applicable foreign authority submission, or
are in preclinical research and development. We have not submitted an NDA to the
FDA or equivalent application to any other foreign regulatory authorities for
any of our product candidates, and the products have not been determined to be
safe or effective in humans for their intended uses.
Conducting clinical trials is a lengthy, time-consuming and expensive
process. Before obtaining regulatory approvals for the commercial sale of any
products, we must demonstrate through preclinical testing and clinical trials
that our product candidates are safe and effective for use in humans. We will
incur substantial expense for, and devote a significant amount of time to,
preclinical testing and clinical trials.
Drug discovery methods based upon molecular cardiology are relatively
new. We cannot be certain that these methods will lead to commercially viable
pharmaceutical products. In addition, some of our compounds within our cardiac
imaging, cell cycle inhibition, cardiac conduction, cardiac metabolism and
Tangier disease drug discovery programs are in the early stages of research and
development, and we have not submitted IND applications or commenced clinical
trials for these new compounds. We cannot be certain when these clinical trials
will commence, if at all. Because these compounds are in the early stages of
product development, we could abandon further development efforts before they
reach clinical trials.
We cannot be certain that any of our product development efforts will
be successfully completed or that any of our products will be shown to be safe
and effective. Even if we believe
5
<PAGE>
that any product is safe and effective, we may not obtain the required
regulatory approvals. Furthermore, we may not be able to manufacture our
products in commercial quantities or market any products successfully.
IF WE ARE UNABLE TO SATISFY THE REGULATORY REQUIREMENTS FOR OUR CLINICAL TRIALS,
WE WILL NOT BE ABLE TO COMMERCIALIZE OUR DRUG CANDIDATES.
All of our products may require additional development, preclinical
studies, clinical trials and regulatory approval prior to commercialization. Any
delays in our clinical trials would delay market launch and would increase our
cash requirements.
We currently have only two products in clinical development: ranolazine
and CVT-510. Many factors could delay completion of our clinical trials,
including:
- slower than anticipated patient enrollment
- difficulty in obtaining sufficient supplies of clinical trial
materials
- adverse events occurring during the clinical trials.
For example, our first Phase III clinical trial of ranolazine, called
Monotherapy Assessment of Ranolazine In Stable Angina or MARISA, had challenging
enrollment criteria. These criteria required patients who suffer from angina to
stop taking all of their other anti-anginal medications and receive only placebo
during segments of the clinical trial. This meant that they received no
medication to treat their angina when they received placebo. Given the
difficulty of identifying patients willing to completely stop taking
anti-anginal medications, enrollment for this trial was slower than anticipated.
We cannot assure you that enrollment for the second Phase III trial for
ranolazine, called Combination Assessment of Ranolazine In Stable Angina or
CARISA, will not also be delayed.
In addition, data obtained from preclinical and clinical activities are
susceptible to different interpretations, which could delay, limit or prevent
regulatory approval. Delays or rejections may be based upon many factors,
including changes in regulatory policy during the period of product development.
For example, the initial clinical trials with ranolazine used a different
formulation of ranolazine than we used in the MARISA trial and than we are using
in the CARISA trial. This means that the NDA will contain data from trials using
two different formulations and is subject to interpretation by the FDA. An
unfavorable interpretation could result in actions by the FDA that would delay
potential approval. We may be unable to maintain our proposed schedules for IND
applications and clinical protocol submissions to the FDA, initiations of
clinical trials and completions of clinical trials as a result of FDA reviews or
complications that may arise in any phase of the clinical trial program.
Furthermore, even if our clinical trials occur on schedule, the results
may differ from those obtained in preclinical studies and earlier clinical
trials. Clinical trials may not demonstrate sufficient safety and efficacy to
obtain the necessary approvals. For example, in November
6
<PAGE>
1995, based on unfavorable efficacy data from a Phase II trial, we terminated a
prior development program.
IF WE ARE UNABLE TO SATISFY GOVERNMENTAL REGULATIONS RELATING TO THE DEVELOPMENT
OF OUR DRUG CANDIDATES, WE MAY BE UNABLE TO OBTAIN NECESSARY REGULATORY
APPROVALS TO COMMERCIALIZE OUR PRODUCTS.
The research, testing, manufacturing and marketing of drug products are
subject to extensive regulation by numerous regulatory authorities in the United
States and other countries. Failure to comply with FDA or other applicable
regulatory requirements may subject a company to administrative or judicially
imposed sanctions. These include:
- warning letters
- civil penalties
- criminal penalties
- injunctions
- product seizure or detention
- product recalls
- total or partial suspension of production
- FDA refusal to approve pending NDAs or supplements to approved
NDAs.
The process of obtaining FDA and other required regulatory approvals,
including foreign approvals, often takes many years and can vary substantially
based upon the type, complexity and novelty of the products involved.
Furthermore, this approval process is extremely expensive and uncertain. We
cannot guarantee that any of our products under development will be approved for
marketing by the FDA. Even if regulatory approval of a product is granted, we
cannot be certain that we will be able to obtain the labeling claims necessary
or desirable for the promotion of those products.
Even if we obtain regulatory approval, we may be required to undertake
postmarketing trials. In addition, identification of side effects after a drug
is on the market or the occurrence of manufacturing problems could cause
subsequent withdrawal of approval, reformulation of the drug, additional
preclinical testing or clinical trials, changes in labeling of the product, and
additional marketing applications.
If we receive regulatory approval, we will also be subject to ongoing
FDA obligations and continued regulatory review. In particular, we or our third
party manufacturers will be required to adhere to regulations setting forth
current good manufacturing practices, known as cGMP. The regulations require
that we manufacture our products and maintain our records in a prescribed manner
with respect to manufacturing, testing and quality control activities.
7
<PAGE>
Furthermore, we or our third party manufacturers must pass a preapproval
inspection of manufacturing facilities by the FDA before obtaining marketing
approval. We will also be subject to ongoing FDA requirements for submission of
safety reports and other postmarket information.
If we receive regulatory approval and if any of our products or
services become reimbursable by a government health care program, such as
Medicare or Medicaid, we may become subject to certain federal and state health
care fraud and abuse and reimbursement laws. These laws include the federal
"Anti-Kickback Statute," "False Claims Act," and "Physician Self-Referral Law,"
and their state counterparts. If and when we become subject to such laws, our
arrangements with third parties, including health care providers, physicians,
vendors, and Innovex Inc., a subsidiary of Quintiles Transnational Corp., will
need to comply with these laws as applicable. We do not know whether our
existing or future arrangements will be found to be compliant. Violations of
these statutes could result in criminal and civil penalties and exclusion from
governmental health care programs.
OUR PRODUCTS, EVEN IF APPROVED BY THE FDA OR FOREIGN REGULATORY AGENCIES, MAY
NOT BE ACCEPTED BY PHYSICIANS, INSURERS OR PATIENTS.
If any of our products after receiving FDA or other foreign regulatory
approval fail to achieve market acceptance, our ability to become profitable in
the future will be adversely affected. We believe that market acceptance will
depend on our ability to provide acceptable evidence of safety, efficacy and
cost effectiveness. In addition, we believe market acceptance depends on the
effectiveness of our marketing strategy and the availability of reimbursement
for our products.
WE HAVE NO MARKETING OR SALES EXPERIENCE, AND IF WE ARE UNABLE TO ENTER INTO OR
MAINTAIN COLLABORATIONS WITH MARKETING PARTNERS OR IF WE ARE UNABLE TO DEVELOP
OUR OWN SALES AND MARKETING CAPABILITY, WE MAY NOT BE SUCCESSFUL IN
COMMERCIALIZING OUR PRODUCTS.
We currently have no sales, marketing or distribution capability. As a
result, we depend on collaborations with third parties, such as Innovex, Biogen,
Inc., and Fujisawa Healthcare, Inc., which have established distribution systems
and direct sales forces. For instance, we have entered into a sales and
marketing services agreement with Innovex with respect to ranolazine. Innovex
will market and sell ranolazine in the United States using a dedicated sales
force if and when FDA approval to market ranolazine has been granted.
Commercialization of ranolazine depends on Innovex to perform its contractual
obligations. Its failure to do so would adversely affect commercialization of
ranolazine. To the extent that we enter into co-promotion or other licensing
arrangements, our revenues will depend upon the efforts of third parties, over
which we may have little control. In addition, Biogen is responsible for
establishing marketing and sales activities for any product that results from
the Adentri-TM- program and Fujisawa is responsible for establishing marketing
and sales activities for CVT-3146.
If we are unable to reach and maintain agreement with one or more
pharmaceutical companies or collaborative partners, we may be required to market
our products directly. We
8
<PAGE>
may elect to establish our own specialized sales force and marketing
organization to market our products to cardiologists. In order to do this, we
would have to develop a marketing and sales force with technical expertise and
with supporting distribution capability. Developing a marketing and sales force
is expensive and time consuming and could delay any product launch. We cannot be
certain that we will be able to develop this capacity.
OUR BUSINESS DEPENDS ON ATTRACTING AND RETAINING COLLABORATORS AND LICENSORS.
We may not be able to retain current or attract new corporate and
academic collaborators, licensors, licensees and others. Our business strategy
requires us to enter into various arrangements with these parties, and we are
dependent upon the success of these parties in performing their obligations. If
we fail to obtain and maintain these arrangements, the development of our
products would be delayed. We may be unable to proceed with the development,
manufacture or sale of products or we might have to fund development of a
particular product candidate internally. If we have to fund development and
commercialization of all of our products internally, our future capital
requirements will increase substantially.
The collaborative arrangements that we may enter into in the future may
place responsibility on the collaborative partner for preclinical testing and
clinical trials, manufacturing and preparation and submission of applications
for regulatory approval of potential pharmaceutical products. We cannot control
the amount and timing of resources which our collaborative partners devote to
our programs. If a collaborative partner fails to successfully develop or
commercialize any product, product launch would be delayed. In addition,
collaborators may pursue competing technologies or product candidates.
Under our collaborative arrangements, we or our collaborative partners
may also have to meet performance milestones. If we fail to meet our obligations
under our collaborative arrangements, our collaborators could terminate their
arrangements or we could lose rights to the compounds under development. For
example, under our agreement with Innovex, we are required to launch the product
by a specific date. If we fail to reach this milestone, Innovex will no longer
be obligated to provide sales and marketing services for ranolazine. Under our
agreement with Biogen, in order for us to receive development milestone
payments, Biogen must meet development milestones. Under our license agreement
with Syntex U.S.A., Inc., a subsidiary of Roche, for ranolazine, we are required
to make milestone payments to Syntex following FDA approval of ranolazine and
following regulatory approval of ranolazine in Europe. These payments are due no
later than March 31, 2005 and March 31, 2006, respectively. Under our agreement
with Fujisawa, we are responsible for development activities and must meet
development milestones in order to receive development milestone payments.
In addition, collaborative arrangements in our industry are extremely
complex, particularly with respect to intellectual property rights. Disputes may
arise in the future with respect to the ownership of rights to any technology
developed with or by third parties. These and other possible disagreements
between us and our collaborators could lead to delays in the collaborative
research, development or commercialization of product candidates. These disputes
could also result in litigation or arbitration, which is time consuming and
expensive.
9
<PAGE>
WE EXPECT TO CONTINUE TO OPERATE AT A LOSS AND MAY NEVER ACHIEVE PROFITABILITY.
We cannot be certain that we will ever achieve and sustain
profitability. Since our inception, we have been engaged in research and
development activities. We have generated no product revenues. As of March 31,
2000, we had an accumulated deficit of $99.8 million. The process of developing
our products requires significant additional research and development,
preclinical testing and clinical trials, as well as regulatory approvals. These
activities, together with our general and administrative expenses, are expected
to result in operating losses for the foreseeable future.
WE MUST SECURE ADDITIONAL FINANCING TO MEET OUR FUTURE NEEDS.
We will require substantial additional funding in order to complete our
research and development activities and commercialize any products. In the past,
we have financed our operations primarily through the sale of equity securities,
payments from our collaborators, equipment and leasehold improvement financing
and other debt financing. We have generated no product revenue, and none is
expected for at least several years. We anticipate that our existing resources
and projected interest income will enable us to maintain our current and planned
operations for at least the next 24 months. However, we may require additional
funding prior to that time.
Additional financing may not be available on acceptable terms or at
all. If we are unable to raise additional funds, we may:
- have to delay, scale back or eliminate some or all of our research
or development programs
- lose rights under existing licenses
- have to relinquish more of, or all of, our rights to product
candidates at an earlier stage of development or on less favorable
terms than we would otherwise seek
- be unable to operate as a going concern.
Our future capital requirements will depend on many factors, including:
- scientific progress in our research and development programs
- the size and complexity of our programs
- the timing, scope and results of preclinical studies and clinical
trials
- our ability to establish and maintain corporate partnerships
- the time and costs involved in obtaining regulatory approvals
- the costs involved in filing, prosecuting and enforcing patent
claims
10
<PAGE>
- competing technological and market developments
- the cost of manufacturing or obtaining preclinical and clinical
material.
There may be additional factors that could affect our need for
additional financing. Many of these factors are not within our control.
INABILITY TO COMPETE SUCCESSFULLY IN OUR MARKET WILL HARM OUR BUSINESS.
The pharmaceutical and biopharmaceutical industries, and the market for
cardiovascular drugs in particular, are intensely competitive. If regulatory
approvals are received, some of our products will compete with well-established,
proprietary and generic cardiovascular therapies that have generated substantial
sales over a number of years. Many of these therapies are reimbursed from
government health administration authorities and private health insurers.
In addition, we are aware of companies which are developing products
that may compete in the same markets as our products. Many of these potential
competitors have substantially greater product development capabilities and
financial, scientific, marketing and sales resources. Other companies may
succeed in developing products earlier or obtain approvals from the FDA more
rapidly than either we or our corporate partners are able to achieve.
Competitors may also develop products that are safer or more effective than
those under development or proposed to be developed by us and our corporate
partners. In addition, research and development by others could render our
technology or our products obsolete or non-competitive.
WE MAY BE UNABLE TO EFFECTIVELY PROTECT OUR INTELLECTUAL PROPERTY.
Our success will depend to a significant degree on our ability to:
- obtain patents and licenses to patent rights
- maintain trade secrets
- operate without infringing on the proprietary rights of others.
We cannot be certain that patents will issue from any of our pending or
future patent applications, that any issued patent will be sufficient to protect
our technology or that we will be able to obtain extensions of patents beyond
the initial term. For example, a primary patent relating to ranolazine will
expire in May 2003 unless we are granted an extension based upon the
Waxman-Hatch Act, which we anticipate would extend the patent protection for an
additional five years.
Patent applications in the United States are maintained in secrecy
until a patent issues. As a result, we can never be certain that others have not
filed patent applications for technology covered by our pending applications or
that we were the first to invent the technology. There may be third party
patents, patent applications and other intellectual property relevant to our
products and technology which are not known to us and that block or compete with
our compounds, products or processes.
11
<PAGE>
Competitors may have filed applications for, or may have received
patents and may obtain additional patents and proprietary rights relating to,
compounds, products or processes that block or compete with ours. We may have to
participate in interference proceedings declared by the Patent and Trademark
Office. These proceedings determine the priority of invention and, thus, the
right to a patent for the technology in the United States. In addition,
litigation may be necessary to enforce any patents issued to us or to determine
the scope and validity of the proprietary rights of third parties. Litigation
and interference proceedings, even if they are successful, are expensive to
pursue, and we could use a substantial amount of our limited financial resources
in either case.
Just as it is important to protect our proprietary rights, we also must
not infringe patents issued to competitors and not breach the licenses that
might cover technology used in our potential products. If our competitors own or
have rights to technology that we need in our product development efforts, we
will need to obtain a license to those rights. If we fail to obtain any
necessary licenses, we may be unable to complete product development.
We also rely on trade secrets to develop and maintain our competitive
position. Although we protect our proprietary technology in part by
confidentiality agreements with employees, consultants, collaborators, advisors
and corporate partners, these agreements may be breached. We cannot assure you
that these agreements will provide meaningful protection or adequate remedies in
the event of unauthorized use or disclosure of this information. We also cannot
assure you that the parties to these agreements will not breach them. In that
event, we may not have adequate remedies for any breach. As a result, third
parties may gain access to our trade secrets, and third parties may disclose our
trade secrets and confidential technology to the public. In addition, it is
possible that our trade secrets will otherwise become known or be discovered
independently by our competitors.
Patent litigation is becoming more widespread in the biopharmaceutical
industry. Although no third party has asserted a claim of infringement against
us, we cannot assure you that third parties will not assert patent or other
intellectual property infringement claims against us with respect to our
products or technology or other matters. If they do, we may not prevail and we
may not be able to obtain any necessary licenses on reasonable terms, if at all.
Any such claims against us, with or without merit, as well as claims initiated
by us against third parties, can be time-consuming and expensive to defend or
prosecute.
WE HAVE NO MANUFACTURING EXPERIENCE AND WILL DEPEND ON THIRD PARTIES TO
MANUFACTURE OUR PRODUCTS.
We do not currently operate manufacturing facilities for clinical or
commercial production of our products under development. We have no experience
in manufacturing, and we currently lack the resources or capability to
manufacture any of our products on a clinical or commercial scale. As a result,
we are dependent on corporate partners, licensees or other third parties for the
manufacturing of clinical and commercial scale quantities of our products.
For example, we have entered into an agreement with a third party
manufacturer for clinical scale production of an amount of ranolazine's active
pharmaceutical ingredient that we believe will be sufficient to support the
remainder of the Phase III clinical program. We cannot
12
<PAGE>
be certain that we will be able to enter into an agreement for the commercial
scale manufacture of the active ingredient in ranolazine. If we are unable to do
so, our Phase III trials of ranolazine will be delayed. We have entered into an
agreement with a third party manufacturer for clinical scale production of
ranolazine tablets sufficient to support the remainder of the Phase III clinical
program and are negotiating with them for registration and commercialization
supply of ranolazine tablets. If we are unable to negotiate an agreement to
supply ranolazine tablets for registration and commercialization, commercial
launch of ranolazine may be delayed. In addition, because we have used various
manufacturers for ranolazine in different clinical trials prior to FDA approval
of ranolazine, we will be required to demonstrate to the FDA's satisfaction the
bioequivalence of the multiple sources of ranolazine used in our clinical trials
and their bioequivalence to the product to be commercially supplied.
FAILURE TO OBTAIN ADEQUATE REIMBURSEMENT FROM GOVERNMENT HEALTH ADMINISTRATION
AUTHORITIES, PRIVATE HEALTH INSURERS AND OTHER ORGANIZATIONS COULD MATERIALLY
ADVERSELY AFFECT OUR FUTURE BUSINESS, RESULTS OF OPERATIONS AND FINANCIAL
CONDITION.
Our ability and the ability of our existing and future corporate
partners to market and sell our products will depend in part on the extent to
which reimbursement for the cost of our products and related treatments will be
available from government health administration authorities, private health
insurers and other organizations. Third party payors are increasingly
challenging the price of medical products and services.
Significant uncertainty exists as to the reimbursement status of newly
approved health care products. In addition, for sales of our products in Europe,
we will be required to seek reimbursement on a country-by-country basis. We
cannot be certain that any products approved for marketing will be considered
cost effective or that reimbursement will be available or that allowed
reimbursement in foreign countries will be adequate. In addition, payors'
reimbursement policies could adversely affect our or any corporate partner's
ability to sell our products on a profitable basis.
OUR OPERATIONS INVOLVE HAZARDOUS MATERIALS, WHICH COULD SUBJECT US TO
SIGNIFICANT LIABILITY.
Our research and development activities involve the controlled use of
hazardous materials, including hazardous chemicals, radioactive materials and
pathogens. Accordingly, we are subject to federal, state and local laws
governing the use, handling and disposal of these materials. We may incur
significant costs to comply with additional environmental and health and safety
regulations in the future. Although we believe that our safety procedures for
handling and disposing of hazardous materials comply with regulatory
requirements, we cannot eliminate the risk of accidental contamination or injury
from these materials. In the event of an accident or environmental discharge, we
may be held liable for any resulting damages, which may exceed our financial
resources and may materially adversely affect our business, financial condition
and results of operations.
13
<PAGE>
WE MAY BE SUBJECT TO PRODUCT LIABILITY CLAIMS IF OUR PRODUCTS HARM PEOPLE, AND
WE HAVE ONLY LIMITED PRODUCT LIABILITY INSURANCE.
The manufacture and sale of human therapeutic products involve an
inherent risk of product liability claims and associated adverse publicity. We
currently have only limited product liability insurance for clinical trials and
no commercial product liability insurance. We do not know if we will be able to
maintain existing or obtain additional product liability insurance on acceptable
terms or with adequate coverage against potential liabilities. This type of
insurance is expensive and may not be available on acceptable terms. If we are
unable to obtain or maintain sufficient insurance coverage on reasonable terms
or to otherwise protect against potential product liability claims, we may be
unable to commercialize our products. A successful product liability claim
brought against us in excess of our insurance coverage, if any, may require us
to pay substantial amounts. This could adversely affect our results of
operations and our need for and the timing of additional financing.
THE MARKET PRICE OF OUR STOCK MAY CONTINUE TO BE HIGHLY VOLATILE.
Within the last 12 months, our common stock has traded between [$5.375
and $82.75]. The market price of the shares of common stock for our company has
been and may continue to be highly volatile. Announcements may have a
significant impact on the market price of our common stock. These announcements
may include:
- results of our clinical trials and preclinical studies, or those of
our corporate partners or our competitors
- our operating results
- developments in our relationships with corporate partners
- developments affecting our corporate partners
- negative regulatory action or regulatory approval with respect to
our announcement or our competitors' announcement of new products
- government regulations, reimbursement changes and governmental
investigations or audits related to us or to our products
- developments related to our patents or other proprietary rights or
those of our competitors
- changes in the position of securities analysts with respect to our
stock
- operating results below the expectations of public market analysts
and investors
- market conditions for biopharmaceutical or biotechnology stocks in
general.
The stock market has from time to time experienced extreme price and
volume fluctuations, which have particularly affected the market prices for
emerging biotechnology and
14
<PAGE>
biopharmaceutical companies, and which have often been unrelated to their
operating performance. These broad market fluctuations may adversely affect the
market price of our common stock.
DELAWARE LAW, PROVISIONS IN OUR CHARTER AND OUR RIGHTS PLAN COULD MAKE THE
ACQUISITION OF OUR COMPANY BY ANOTHER COMPANY MORE DIFFICULT.
Provisions of our certificate of incorporation may have the effect of
delaying or preventing changes in control or management or limit the price that
investors may be willing to pay for shares of our common stock. In addition, we
are subject to the provisions of Section 203 of the Delaware General Corporation
Law, an anti-takeover law, which could delay a merger, tender offer or proxy
contest or make a similar transaction more difficult. In addition, our board of
directors has the authority to issue up to 5,000,000 shares of preferred stock
without stockholders' approval. The rights of the holders of common stock will
be subject to, and may be affected by, the rights of the holders of any
preferred stock that may be issued 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 voting stock.
Furthermore, in February 1999, the board of directors enacted
anti-takeover provisions, including a stockholder rights plan, or "poison pill,"
and severance agreements in the event of a change of control for key executives.
15
<PAGE>
FORWARD-LOOKING STATEMENTS
This prospectus contains forward-looking statements. These statements
relate to future events or our future clinical or product development or
financial performance. In some cases, you can identify forward-looking
statements by terminology such as "may," "will," "should," "expects," "plans,"
"anticipates," "believes," "estimates," "predicts," "potential" or "continue" or
the negative of those terms and other comparable terminology.
These statements reflect only management's current expectations. In
evaluating these statements, you should specifically consider various factors,
including the risks outlined above. These factors may cause our actual results
to differ materially from any forward-looking statements.
We undertake no obligation to publicly update any forward-looking
statements, whether as a result of new information, future events or otherwise.
You are advised, however, to consult any additional disclosures we make in our
Form 10-Q, 8-K and 10-K reports to the SEC. Also note that we provide a
cautionary discussion of risks and uncertainties under "Risk Factors" on page 5
of this prospectus. These are factors that we think could cause our actual
results to differ materially from expected results.
16
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the SEC. You may read and copy any document we file at
the SEC's public reference room at 450 Fifth Street, N.W., Washington, D.C.,
20549. You can request copies of these documents by contacting the SEC and
paying a fee for the copying cost. Please call the SEC at 1-800-SEC-0330 for
further information on the public reference rooms. Our SEC filings are also
available to the public from the SEC's website at www.sec.gov.
This prospectus is part of a registration statement on Form S-3,
including amendments, relating to the common stock offered by this prospectus
with the SEC. This prospectus does not contain all of the information set forth
in the registration statement, the exhibits and schedules, some portions of
which the SEC allows us to omit. Statements contained in this prospectus as to
the contents of any contract or other document referred to are not necessarily
complete and in each instance reference is made to the copy of that contract or
other document filed as an exhibit to the registration statement. For further
information about us and the common stock offered by this prospectus we refer
you to the registration statement and its exhibits and schedules which may be
obtained as described above.
The SEC allows us to "incorporate by reference" the information
contained in documents that we file with them, which means that we can disclose
important information to you by referring you to those documents. The
information incorporated by reference is considered to be part of this
prospectus. Information in this prospectus supersedes information incorporated
by reference that we filed with the SEC before the date of this prospectus,
while information that we file later with the SEC will automatically update and
supersede prior information. We incorporate by reference the documents listed
below and any future filings we will make with the SEC under Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended, prior to
the termination of the offering:
1. our Annual Report on Form 10-K for the fiscal year ended December
31, 1999;
2. our Quarterly Report on Form 10-Q for the fiscal quarter ended March
31, 2000;
3. our Current Reports on Form 8-K, dated February 25, 2000 and March
1, 2000; and
4. the description of our common stock contained in our registration
statement on Form 8-A filed on October 30, 1996.
You may request copies of these filings, at no cost, by writing or
telephoning us at:
CV Therapeutics, Inc.
Attention: Investor Relations
3172 Porter Drive
Palo Alto, California 94304
Telephone (650) 812-0585
17
<PAGE>
USE OF PROCEEDS
We cannot guarantee that we will receive any proceeds in connection
with this offering.
We intend to use the net proceeds of this offering, if any, to fund
research, development and product manufacturing, to provide working capital and
for general corporate purposes. We may also use a portion of the net proceeds to
acquire or invest in businesses, products and technologies that are
complementary to our own, although no acquisitions are planned or being
negotiated as of the date of this prospectus, and no portion of the net proceeds
has been allocated for any specific acquisition. Pending these uses, the net
proceeds will be invested in investment-grade, interest-bearing securities.
The principal purposes of this offering are to increase our
capitalization and our operating and financial flexibility. As of the date of
this prospectus, we cannot specify with certainty all of the particular uses for
the net proceeds we will have upon completion of this offering. Accordingly, our
management will have broad discretion in the application of net proceeds, if
any.
Based upon our current operating plan, we believe that our available
cash and existing sources of revenue, together with the proceeds of this
offering, if any, and interest earned thereon, will be adequate to satisfy our
capital needs until at least the end of the year 2001.
18
<PAGE>
PLAN OF DISTRIBUTION
We may offer the common stock:
- directly to purchasers;
- to or through underwriters;
- through dealers, agents or institutional investors; or
- through a combination of such methods.
Regardless of the method used to sell the common stock, we will provide
a prospectus supplement that will disclose:
- the identity of any underwriters, dealers, agents or institutional
investors who purchase the common stock;
- the material terms of the distribution, including the number of
shares sold and the consideration paid;
- the amount of any compensation, discounts or commissions to be
received by the underwriters, dealers, agents or institutional
investors;
- the terms of any indemnification provisions, including
indemnification from liabilities under the federal securities laws;
and
- the nature of any transaction by an underwriter, dealer or agent
during the offering that is intended to stabilize or maintain the
market price of the common stock.
We will bear the expenses incident to the registration of the shares,
other than selling discounts and commissions. These expenses are estimated to be
$150,000.
19
<PAGE>
LEGAL MATTERS
The validity of the issuance of the common stock offered in this
prospectus will be passed upon for CV Therapeutics by Latham & Watkins, Menlo
Park, California. Alan C. Mendelson, our Secretary and a partner of Latham &
Watkins, owns 1008 shares of our common stock.
EXPERTS
Ernst & Young LLP, independent auditors, have audited our financial
statements included in our Annual Report on Form 10-K for the year ended
December 31, 1999, as set forth in their report, which is incorporated by
reference in this prospectus and elsewhere in the registration statement. Our
financial statements are incorporated by reference in reliance on Ernst & Young
LLP's report, given upon their authority as experts in accounting and auditing.
MATERIAL CHANGES
On July 11, 2000, we entered into a Collaboration and License Agreement
with Fujisawa Healthcare, Inc. to collaborate in the development and marketing
of second generation pharmacologic cardiac stress agents. Under this agreement,
Fujisawa receives exclusive North American rights to CVT-3146, a short acting
selective A2A adenosine receptor agonist, and a backup compound. We will retain
the responsibility for managing the CVT-3146 development program. Fujisawa will
be responsible for selling and marketing CVT-3146 in North America. Under the
agreement, we have received $10 million from Fujisawa, in part for the purchase
of our common stock, and may receive up to an additional $24 million based on
our reaching development and regulatory milestones. Fujisawa will reimburse us
for 75% of the development costs and, if approved by the FDA, we will receive a
royalty based on product sales of CVT-3146 and we may receive a royalty on other
products.
20
