AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 3, 1997
REGISTRATION NO. 333-37941
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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VION PHARMACEUTICALS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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DELAWARE 13-3671221
(STATE OR OTHER JURISDICTION (I.R.S. EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
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4 SCIENCE PARK
NEW HAVEN, CONNECTICUT 06511
(203) 498-4210
(ADDRESS AND TELEPHONE NUMBER OF PRINCIPAL EXECUTIVE OFFICES)
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JOHN A. SPEARS
PRESIDENT AND CHIEF EXECUTIVE OFFICER
VION PHARMACEUTICALS, INC.
4 SCIENCE PARK
NEW HAVEN, CONNECTICUT 06511
(203) 498-4210
(NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE)
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COPIES OF ALL COMMUNICATIONS, INCLUDING ALL COMMUNICATIONS SENTTO THE AGENT FOR
SERVICE, SHOULD BE SENT TO:
TERRENCE JONES, ESQ.
WIGGIN & DANA
ONE CENTURY TOWER
NEW HAVEN, CONNECTICUT 06508
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APPROXIMATE DATE OF PROPOSED SALE TO THE PUBLIC: As soon as practicable
after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, check the following box:
[ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box: [x]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ] _______ .
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ] _________.
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
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PURSUANT TO RULE 416 UNDER THE SECURITIES ACT OF 1933, AS AMENDED, THERE ARE
ALSO BEING REGISTERED SUCH ADDITIONAL SECURITIES AS MAY BE ISSUABLE TO THE
SELLING SECURITYHOLDERS PURSUANT TO APPLICABLE ANTI-DILUTION PROVISIONS.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(A), MAY
DETERMINE.
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PROSPECTUS
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VION PHARMACEUTICALS, INC.
22,027,022 SHARES OF COMMON STOCK
810,991 REDEEMABLE CLASS A WARRANTS
4,812,383 REDEEMABLE CLASS B WARRANTS
This Prospectus relates to 22,027,022 shares of Common Stock, $.01 par value
("Common Stock") of Vion Pharmaceuticals, Inc., a Delaware corporation (the
"Company"). This Prospectus also relates to 810,991 Redeemable Class A Warrants
(the "Class A Warrants") of the Company, and 4,812,383 Redeemable Class B
Warrants ("Class B Warrants"). The Common Stock, the Class A Warrants, the Class
B Warrants and the underlying securities are being offered by the Selling
Securityholders set forth herein. See "SELLING SECURITYHOLDERS." Of the
22,027,022 shares of Common Stock being sold by the Selling Securityholders,
10,615,389 of such shares represent shares issuable upon exercise of
publicly-traded Warrants. In addition, 3,726,392 of the Class B Warrants being
sold by the Selling Securityholders represent Class B Warrants issuable upon
exercise of the Company's publicly-traded Class A Warrants. The Company will not
receive any proceeds from the sale of such securities. The Class A Warrants and
the Class B Warrants are referred to herein collectively as the "Warrants" and
the Common Stock, the securities issuable upon exercise of the Class A Warrants,
together with the Class A Warrants, are sometimes collectively referred to
herein as the "Securities." Each Class A Warrant entitles the holder to
purchase, at an exercise price of $4.73, subject to adjustment, one share of
Common Stock and one Class B Warrant, and each Class B Warrant entitles the
holder to purchase, at an exercise price of $6.37, subject to adjustment, one
share of Common Stock. The Warrants are exercisable at any time after issuance
through August 13, 2000. The Warrants are subject to redemption by the company
for $.05 per Warrant, upon 30 days' written notice, if the average closing bid
price of the Common Stock exceeds $7.30 per share with respect to the Class A
Warrants and $9.80 share with respect to the Class B Warrants for 30 consecutive
business days ending within 15 days of the date of the notice of redemption.
The securities offered by the Selling Securityholders pursuant to this
Prospectus may be sold from time to time by the Selling Securityholders. The
distribution of the Common Stock, Class A Warrants, and the Class B Warrants
offered hereby by the Selling Securityholders may be effected in one or more
transactions that may take place on the NASDAQ SmallCap MarketSM, including
ordinary brokers' transactions, privately negotiated transactions or through
sales to one or more dealers for resale of such securities as principals, at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. Usual and customary or
specifically negotiated brokerage fees or commissions may be paid by the Selling
Securityholders.
The Selling Securityholders, and intermediaries through whom such securities
are sold, may be deemed underwriters within the meaning of the Securities Act of
1933, as amended (the "Securities Act"), with respect to the securities offered,
and any profits realized or commissions received may be deemed underwriting
compensation. The Company has agreed to indemnify the Selling Securityholders
against certain liabilities, including liabilities under the Securities Act.
The Company will not receive any of the proceeds from the sale of securities
by the Selling Securityholders. In the event the Class A Warrants and Class B
Warrants registered hereby are exercised, the Company will receive gross
proceeds of approximately $3,835,000 and $30,650,000 respectively. See "SELLING
SECURITYHOLDERS" and "PLAN OF DISTRIBUTION."
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FOR INFORMATION CONCERNING CERTAIN FACTORS THAT SHOULD BE CONSIDERED
BY PROSPECTIVE INVESTORS, SEE "RISK FACTORS" beginning on page 3 of this
Prospectus.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THE DATE OF THIS PROSPECTUS IS NOVEMBER 3, 1997
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files periodic reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information filed with the Commission may be inspected and
copied at the Public Reference Section of the Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549 and at the regional offices of the Commission
located at 500 West Madison Street, Chicago, Illinois 60661, and Seven World
Trade Center, New York, New York 10048. Copies of such material can be obtained
from the Public Reference Section of the Commission at prescribed rates by
writing to the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549. The
Commission maintains a Web site at http://www.sec.gov that contains reports,
proxy and information statements and other information regarding registrants
that file electronically with the Commission, including the Company. In
addition, reports, proxy materials and other information concerning the Company
may be inspected at the offices of NASDAQ, 1735 K Street N.W., Washington, D.C.
20006.
This Prospectus constitutes a part of a Registration Statement on Form S-3
(herein, together with all amendments and exhibits, referred to as the
"Registration Statement") filed by the Company with the Commission under the
Securities Act. This Prospectus does not contain all of the information set
forth in the Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the Commission. For further
information with respect to the Company and the Common Stock, Class A Warrants
and Class B Warrants, reference is hereby made to the Registration Statement.
Statements contained herein concerning the provisions of any document are not
necessarily complete, and in each instance reference is made to the copy of such
document filed as an exhibit to the Registration Statement or otherwise filed
with the Commission. Each such statement is qualified in its entirety by such
reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, which are on file with the Commission (File No.
0-26534), are incorporated in this Prospectus by reference and made a part
hereof:
(a) The Company's Annual Report on Form 10-KSB for the fiscal year ended
December 31, 1996.
(b) The Company's Quarterly Report on Form 10-QSB for the fiscal quarter
ended March 31, 1997.
(c) The Company's Quarterly Report on Form 10-QSB for the fiscal quarter
ended June 30, 1997.
(d) The description of the Company's Common Stock, Class A Warrants and
Class B Warrants contained in Item 1 of the Company's Registration Statement on
Form 8-A dated July 31, 1995.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date of this Prospectus and prior to
the termination of this offering shall be deemed to be incorporated by reference
into this Prospectus and to be a part hereof from the respective dates of filing
of such documents. Any statement contained in a document incorporated or deemed
to be incorporated by reference herein shall be deemed to be modified or
superseded for all purposes to the extent that a statement contained in this
Prospectus or any other subsequently filed document that is also incorporated by
reference herein modifies or supersedes such statement. Any such statements so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.
The Company will provide without charge to each person to whom this
Prospectus is delivered, upon written or oral request of such person, a copy of
any or all of the foregoing documents incorporated herein by reference (other
than exhibits to such documents, unless such exhibits are specifically
incorporated by reference into such documents). Written or telephone requests
should be directed to Vion Pharmaceuticals, Inc., 4 Science Park, New Haven,
Connecticut 06511, Attention: Thomas E. Klein, Vice President -- Finance, (203)
498-4210.
2
RISK FACTORS
In addition to the other information in this Prospectus, the following
factors should be considered carefully in evaluating the Company and its
business before purchasing the Securities offered hereby.
LIMITED OPERATING HISTORY; ACCUMULATED DEFICIT AND ANTICIPATED FUTURE
LOSSES. The Company is a development-stage enterprise and to date has not
generated any material revenues. At June 30, 1997, the Company had an
accumulated deficit of $22,807,423 and since then significant losses and
decreases in working capital have occurred and are expected to continue for the
foreseeable future. A substantial portion of the Company's losses have been
incurred in connection with research sponsored by it pursuant to an agreement
with Yale University (the "Yale/MelaRx Agreement") on several product
candidates, most of which are not currently being pursued. The Company continues
to have substantial financial commitments to Yale pursuant to such agreement.
The Company will be required to conduct significant research, development,
testing and regulatory compliance activities which, together with projected
general and administrative expenses, are expected to result in operating losses
for at least the next several years, particularly due to the extended time
period before the Company expects to commercialize its principal products, if
ever. There can be no assurance that the Company's research and development
activities will result in any commercially viable products or that the Company
will ever realize revenues from the sale of any of its products. The Company
plans to in-license or otherwise acquire the right to sell oncology-related
products with the goal of generating some revenues prior to the time revenues
could be expected to be received from products resulting from the Company's
research and development programs. However, any such in-licensed products will
not result in revenues, if any, for at least two years and are not expected to
produce sufficient revenues, if any, to fund a significant portion of the
Company's anticipated expenditures on research and development or offset losses
from research and development.
EARLY STAGE OF PRODUCT DEVELOPMENT. The Company is engaged in research and
development on a variety of technologies, pharmaceutical compounds and other
chemical or biological compositions or processes for therapeutic uses, primarily
in connection with the treatment of cancer. There has been only limited research
on many of the Company's technologies and results obtained in research and
testing conducted to date are not conclusive as to whether compounds being
investigated by the Company will be safe and effective for their proposed use.
Most of the Company's proposed products are in the early developmental stage,
require significant further research and development and in many cases lead
compounds have not yet been selected. Most of these proposed products were
licensed pursuant to an agreement with Yale University (the "Yale/OncoRx
Agreement"), which agreement did not provide for ongoing sponsored research. The
Company will need to develop further its own internal research and development
capability to conduct additional research and development activities with
respect to these product candidates. All of the Company's product candidates
require testing and regulatory clearances or approvals, including but not
limited to the Food and Drug Administration (the "FDA"), prior to their
commercial distribution. Accordingly, the Company expects that most of its
products will not be commercially available for a number of years, if ever. The
successful development of any product is subject to the risks of failure
inherent in the development of products or therapeutic procedures based on
innovative technologies. These risks include the possibilities that any or all
of these proposed products or procedures are found to be ineffective or unsafe,
or otherwise fail to receive necessary regulatory clearances or approvals; that
the proposed products or procedures are uneconomical to market or do not achieve
broad market acceptance; that third parties hold proprietary rights that
preclude the Company from marketing them; or that third parties market a
superior or equivalent product. The Company is unable to predict whether its
research and development activities will result in any commercially viable
products or procedures. Further, due to the extended testing and regulatory
review process required before marketing clearance can be obtained, the time
frames for commercialization of any products or procedures are long and
uncertain.
UNCERTAINTY AND RISKS OF TAPET(TM) TECHNOLOGY. The use of bacteria to
deliver genes or gene products is a new technology, and existing preclinical and
clinical data on the safety and efficacy of this technology are very limited. No
products utilizing the TAPET technology are in human clinical trials, and the
results of preclinical studies do not predict safety or efficacy in humans.
TAPET uses bacteria
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for delivery of genes or enzymes to tumors. Possible serious side effects of the
Company's TAPET program include bacterial infections, particularly the risk of
sepsis, a serious and often fatal bacterial infection of the blood. The Company
is bioengineering the bacterial vectors used in TAPET in an effort to eliminate
virulence factors and to minimize the risk of such side effects. However, there
can be no assurance that unacceptable side effects will not be discovered during
preclinical and clinical testing of the Company's potential products.
NEED FOR SIGNIFICANT ADDITIONAL FUNDS AND COLLABORATIVE ARRANGEMENTS;
POTENTIAL DEFAULT UNDER LICENSE AGREEMENTS. The Company believes that its
current cash plus the interest income thereon should be sufficient to enable the
Company to continue funding its operations at currently budgeted spending levels
through February 1998. However, the Company's cash requirements may vary
materially from those now planned because of results of research and
development, results of product testing, relationships with strategic partners,
changes in the focus and direction of the Company's research and development
programs, competitive and technological advances, the regulatory process in the
United States and abroad and other factors. The Company received an opinion from
its auditors, filed as part of its Annual Report for the fiscal year ended
December 31, 1996, expressing substantial doubt as to its ability to continue as
a going concern. The Company intends to address the immediate need for
additional capital by raising funds through a private placement of its
securities, although the Company expects to require additional financing to fund
its longer-term activities and may require additional capital for acquisitions
and new development projects.
The Company's working capital is not sufficient to fund the Company's
operations through the commercialization of the first therapeutic products
resulting from its research and development projects. Additionally, the Company
does not expect that the revenues, if any, from its in-licensing activities will
be sufficient to finance a significant portion of its proposed research and
development activities. The Company will require substantial additional funds
for its research and product development programs, for operating expenses and to
pursue regulatory clearances. The Company has also incurred significant
financial commitments to academic collaborators in connection with license and
sponsored research agreements and will incur significant additional financial
obligations. Adequate funds for these purposes, whether through financial
markets or collaborative or other arrangements with corporate partners or from
other sources, may not be available when needed. The Company has no commitments
to obtain any additional funds and there can be no assurance that additional
funds can be obtained on terms acceptable to the Company, if at all.
Insufficient funds may require the Company to delay, scale back or eliminate
certain of its research and product development programs or license third
parties to commercialize products or technologies that the Company would
otherwise seek to develop itself. Additionally, if funds are insufficient, the
Company may be unable to meet its obligations under its license agreements or
research agreements, make research payments or commercialize the technologies
licensed under such agreements.
In the event that any payments required to be made to academic collaborators
or licensors are not made in a timely fashion, or if the Company is otherwise in
default under agreements with such parties, such parties will have the right to
terminate their research and license arrangements with the Company. Termination
of any such arrangements would have a material adverse effect on the Company by
rendering it unable to continue development of or to commercialize all or a
portion of its product candidates licensed under that agreement. See "-- Risks
Relating to Sponsored Research and License Agreements."
DEPENDENCE ON PATENTS AND TRADE SECRETS; UNCERTAINTY OF PATENT POSITION AND
TRADE SECRETS. The Company's success will depend to a significant extent on its
ability, or the ability of its licensors, to obtain and maintain patent
protection on technologies and products and preserve trade secrets and to
operate without infringing the proprietary rights of others. The patent
situation in the field of biopharmaceutical products generally is highly
uncertain and involves complex legal, scientific and factual questions. To date
there has emerged no consistent policy regarding the breadth of claims allowed
in biopharmaceutical patents. Accordingly, there can be no assurance that patent
applications filed by or on behalf of the Company will result in patents being
issued or that, if issued, the patents will afford protection against
competitors with similar technology. Furthermore, there can be no assurance
4
that others will not independently develop similar technologies or duplicate any
technology developed by the Company. Because of the extensive time required for
development, testing and regulatory review of a potential product, it is
possible that before any of the Company's potential products can be
commercialized, any related patent may expire, or remain in existence for only a
short period following commercialization, thus reducing any advantage of the
patent. Moreover, composition of matter patent protection may not be available
for certain of the Company's product candidates. Specifically, composition of
matter patent protection is not likely to be available for 3TC, a novel
nucleoside analog licensed pursuant to the Yale/OncoRx Agreement, and is not
available for porfiromycin. While the Company may seek alternative protection,
there can be no assurance that the Company will be able to secure meaningful
proprietary protection for any of its proposed products.
The Company's processes and potential products may conflict with patents
which have been or may be granted to competitors, universities or others. As the
biopharmaceutical industry expands and more patents are issued, the risk
increases that the Company's processes and potential products may give rise to
claims that they infringe the patents of others. Such other persons could bring
legal actions against the Company claiming damages and seeking to enjoin
clinical testing, manufacturing and marketing of the affected product or
process. If any such actions are successful, in addition to any potential
liability for damages, the Company could be required to obtain a license in
order to continue to conduct clinical tests, manufacture or market the affected
product or use the affected process. There can be no assurance that the Company
would prevail in any such action or that any license required under any such
patent would be made available on acceptable terms, if at all. If the Company
becomes involved in litigation, litigation could consume a substantial portion
of the Company's resources.
The Company is aware that patent applications have been filed by and/or
United States patents have been issued to, IAFBioChem International, Inc., Emory
University, Glaxo Group Limited, University of Georgia Research Foundation,
Inc., and The Wellcome Foundation Limited of Unicorn House that relate to the
subject matter of patent applications licensed to the Company, namely, 3TC
and/or its use as an anti-hepatitis B virus ("HBV") agent. The Company is also
aware that patent applications have been filed by Biochem Pharma that relate to
subject matter licensed to the Company, namely b-L-FddC and its use as an
anti-HBV agent.
The Company cannot predict whether its or its competitors' patent
applications will result in valid patents being issued. Litigation, which could
result in substantial cost to the Company, may also be necessary to enforce the
Company's patent and proprietary rights and/or to determine the scope and
validity of the patents or proprietary rights of others. The Company may
participate in interference proceedings which may in the future be declared by
the United States Patent and Trademark Office to determine priority of
invention, which could result in substantial cost to the Company.
To the extent that consultants, key employees or other third parties apply
technological information independently developed by them or by others to the
Company's proposed projects, third parties may own all or part of the
proprietary rights to such information, and disputes may arise as to the
ownership of the proprietary rights to such information which may not be
resolved in favor of the Company. To the extent that the Company requires rights
to any resulting technologies, it may be necessary to negotiate additional
license agreements or the Company may be unable to utilize such technologies.
See "-- Risks Relating to Sponsored Research and License Agreements."
The Company may also rely on trade secrets that it may seek to protect, in
part, through confidentiality agreements with employees and other parties. There
can be no assurance that these agreements will not be breached, that the Company
will have adequate remedies for any breach or that the Company's trade secrets
will not otherwise become known to or independently developed by competitors.
RISKS RELATING TO SPONSORED RESEARCH AND LICENSE AGREEMENTS. The Company has
incurred significant financial commitments to academic collaborators in
connection with licenses and sponsored research agreements. In particular,
through June 30, 1997, the Company has paid to Yale approximately
5
$4,560,000 pursuant to the Yale/MelaRx Agreement. The Company continues to have
substantial funding commitments under the Yale/MelaRx Agreement and other
sponsored research agreements, whether or not such research results in suitable
product candidates. Moreover, the Company generally does not have the right to
control the research being conducted pursuant to sponsored research agreements
and there can be no assurance that such research will result in products which
the Company will pursue. In particular, the Company is currently making
unrestricted grants to Yale to support certain research, including research in
Dr. Yung-Chi Cheng's laboratory. There can be no assurance that these funds will
be used to conduct research relating to products which the Company desires to
pursue. Additionally, to the extent that such research results in technologies
not licensed to the Company pursuant to the Yale/OncoRx Agreement, it may be
necessary to negotiate additional license agreements or the Company may be
unable to utilize such technologies.
Certain rights of the Company arise under the Yale/OncoRx Agreement pursuant
to which the Company obtained a license for certain technology developed in the
laboratories of Dr. Alan C. Sartorelli, the Chairman of the Company's Scientific
Advisory Board, and Dr. Yung-Chi Cheng and Dr. James J. Fischer, members of the
Scientific Advisory Board. The Company does not have the rights to the results
of current or future research being performed by Dr. Sartorelli, Dr. Cheng or
Dr. Fischer. There can be no assurance that the Company will be successful in
obtaining the rights to future research performed by Dr. Sartorelli, Dr. Cheng
or Dr. Fischer.
RISKS RELATING TO IN-LICENSING ARRANGEMENTS. The Company has an in-licensing
program directed towards securing rights to certain oncology-related products.
There can be no assurance that the Company will be able to enter into favorable
arrangements or, if necessary, complete the development of any products
in-licensed. There can be no assurance that definitive agreements will result
from ongoing negotiations or that any successfully completed agreements will not
be terminated. There can also be no assurance that the Company will be able to
market any of the products in-licensed or realize anticipated revenues under
those arrangements.
DEPENDENCE UPON KEY PERSONNEL. Because of the specialized scientific nature
of the Company's business, it is dependent upon its ability to attract and
retain qualified management, scientific and technical personnel. The Company is
also dependent upon other key employees, collaborators at other research
institutions and the Company's scientific advisors. John Spears, the Company's
President and Chief Executive Officer, may be considered a key employee. The
Company has entered into an employment agreement with Mr. Spears and maintains a
key man life insurance policy for the benefit of the Company in the amount of
$2,000,000 on his life. The loss of any individuals upon which the Company is
dependent could have a material adverse effect on the Company.
Competition among biopharmaceutical and biotechnology companies for
qualified employees is intense. The loss of qualified employees, or an inability
to attract, retain and motivate any additional highly skilled employees required
for the expansion of the Company's activities, could adversely affect its
business and prospects. There can be no assurance that the Company will be able
to retain and continue to attract qualified employees.
DEPENDENCE ON OTHERS; NO MANUFACTURING AND MARKETING CAPABILITY. The
Company's strategy for the research, development and commercialization of
certain of its products entails entering into various arrangements with
corporate partners, licensors, licensees and others, and is dependent upon the
subsequent success of these outside parties in performing their
responsibilities. The Company may also rely on its collaborative partners to
conduct research efforts and clinical trials, to obtain regulatory approvals and
to manufacture and to market certain of the Company's products. In particular,
the Company has engaged a contract research organization to conduct the Phase
III clinical studies of porfiromycin. Although the Company believes that parties
to any such arrangements would have an economic motivation to succeed in
performing their contractual responsibilities, the amount and timing of
resources to be devoted to these activities may not be within the control of the
Company. There can be no assurance that such parties will perform their
obligations as expected or that any revenue will be derived from such
arrangements. There can also
6
be no assurance that the Company will be successful in establishing any
additional collaborative arrangements or that, if established, the parties to
such arrangements will be successful in commercializing products.
The Company has no experience in manufacturing or marketing any therapeutic
products. The Company currently does not have the resources to manufacture or
market by itself on a commercial scale any products that it may develop. The
Company currently intends to outsource some or all manufacturing requirements it
may have. While the Company has entered into one such agreement and it believes
that it will be able to enter into additional contract manufacturing
arrangements and intends to in-license products which it will have manufactured
on a contract basis, there can be no assurance that it will be able to enter
into additional suitable arrangements. In the event that the Company decides to
establish a manufacturing facility, the Company will require substantial
additional funds and will be required to hire and retain significant additional
personnel and comply with the extensive FDA- mandated good manufacturing
practices ("GMP") applicable to such a facility.
The success of the Company's in-licensing strategy is dependent, in part, on
the Company's ability to develop a quality sales force. The Company has not yet
begun hiring marketing personnel and there can be no assurance that the Company
will be successful in developing an adequate sales force.
UNCERTAINTY OF GOVERNMENT REGULATORY REQUIREMENTS; LENGTHY APPROVAL PROCESS.
The FDA and comparable agencies in foreign countries impose substantial
requirements upon the development, manufacturing and marketing of drugs,
biologics and medical devices through the regulation of laboratory and clinical
testing procedures, manufacturing, labeling, registration, notification,
clearance or approval, marketing, distribution, recordkeeping, reporting and
promotion, and other costly and time-consuming procedures. Satisfaction of
clearance or approval requirements typically takes several years or more and
varies substantially based upon the type, complexity and novelty of the product.
The Company has obtained Orphan Drug status for porfiromycin and intends to seek
Orphan Drug designation for products where appropriate, where no patent
protection is feasible. There can be no assurance that Orphan Drug status will
be obtained for any of the Company's other proposed products.
The effect of government regulation may be to delay marketing of new
products for a considerable or indefinite period of time, to impose costly
procedures upon the Company's activities and to furnish a competitive advantage
to larger companies that compete with the Company. There can be no assurance
that FDA or other regulatory clearance or approval for any products developed by
the Company will be granted on a timely basis, if at all, or, once granted, that
clearances or approvals will not be withdrawn or other regulatory action taken
which might limit the Company's ability to market its proposed products. Any
such delay in obtaining or failure to obtain or maintain such clearances or
approvals would adversely affect the manufacturing and marketing of the
Company's products and the ability to generate product revenue.
UNCERTAINTY RELATED TO HEALTH CARE REIMBURSEMENT AND REFORM MEASURES. The
Company's success in generating revenue from sales of therapeutic products and
medical devices may depend, in part, on the extent to which reimbursement for
the costs of such products and medical devices and related treatments will be
available from government health administration authorities, private health
insurers and other organizations. Significant uncertainty exists as to the
reimbursement status of newly- approved health care products. There can be no
assurance that adequate third-party insurance coverage will be available for the
Company to establish and maintain price levels sufficient for realization of an
appropriate return on its investment in developing new therapies or products.
Government and other third-party payors are increasingly attempting to contain
health care costs by limiting both coverage and the level of reimbursement of
new therapeutic products and medical devices approved for marketing by the FDA
and by refusing, in some cases, to provide any coverage of uses of approved
products for disease indications other than those for which the FDA has granted
marketing approval. If adequate coverage and reimbursement levels are not
provided by government and third-party payors for uses of the Company's
therapeutic products and medical devices, the market acceptance of these
products could be adversely affected.
7
In addition, Congress regularly considers numerous proposals relating to
healthcare reform which, if adopted, could affect the amount paid for
pharmaceutical products and medical procedures. The Company is unable to predict
which proposals, if any, will be adopted, or the effect such proposals may have
on the Company's operations. Future changes in federal, state or local
regulation (or in the interpretation of current regulations) could have a
material adverse effect on the Company.
COMPETITION. The Company is engaged in a rapidly evolving field. Competition
from other pharmaceutical companies, biotechnology companies and research and
academic institutions is intense and expected to increase. The market for cancer
products is large and growing rapidly, and will attract new entrants. Many
companies engaged in the biotechnology and biopharmaceutical sectors have
focused on cancer and most of these companies have substantially greater
financial and other resources and development capabilities than the Company and
have substantially greater experience in undertaking pre-clinical and clinical
testing of products, obtaining regulatory approvals and manufacturing and
marketing pharmaceutical products. Accordingly, certain of the Company's
competitors may succeed in obtaining approval for products more rapidly than the
Company. Other companies may succeed in developing and commercializing products
earlier than the Company that are safer and more effective than those proposed
to be developed by the Company. In addition to competing with universities and
other research institutions in the development of products, technologies and
processes, the Company may compete with other companies in acquiring rights to
products or technologies from universities. There can be no assurance that the
Company will develop products that are more effective or achieve greater market
acceptance than competitive products, or that the Company's competitors will not
succeed in developing products and technologies that are more effective than
those being developed by the Company or that would render the Company's products
and technologies less competitive or obsolete.
RISKS OF TECHNOLOGICAL OBSOLESCENCE. The areas in which the Company is
developing, distributing, and/or licensing products involve rapidly developing
technology. Others may develop products which may render products being
developed, distributed or licensed by the Company obsolete or uneconomical or
result in products superior to the Company's products.
NO PRODUCT LIABILITY INSURANCE. The use or misuse of Company products in
clinical trials and the marketing of any pharmaceutical products it may develop
may expose the Company to product liability claims. The Company does not
currently have any product liability insurance. Although in the future the
Company may seek to obtain product liability insurance, there can be no
assurance that it will be able to obtain or maintain such insurance on
acceptable terms, that such insurance will provide adequate coverage against
potential liabilities or that a product liability claim will not have a material
adverse effect on the Company.
SIGNIFICANT INFLUENCE OF INSIDERS; POTENTIAL ANTI-TAKEOVER PROVISIONS. The
Company's directors and executive officers beneficially own approximately 25% of
the outstanding Common Stock of the Company. As a result, such directors and
officers will be able to significantly influence the election of all of the
Company's directors and otherwise influence control of the Company's operations.
The Company's Board of Directors is also authorized to issue from time to time,
without stockholder authorization, shares of preferred stock, in one or more
designated series or classes. The Company is also subject to a Delaware statute
regulating business combinations. Any of these provisions could discourage,
hinder or preclude an unsolicited acquisition of the Company and could make it
less likely that stockholders receive a premium for their shares as a result of
any such attempt.
OUTSTANDING WARRANTS, OPTIONS AND CONVERTIBLE PREFERRED STOCK. The Company
has outstanding (i) 4,262,383 Class A Warrants to purchase an aggregate of
4,262,383 shares of Common Stock and 4,262,383 Class B Warrants; (ii) 3,162,605
Class B Warrants to purchase 3,162,605 shares of Common Stock; (iii) Purchase
Options granted to the underwriter of the Company's initial public offering (the
"Underwriter") to purchase an aggregate of 1,075,000 shares of Common Stock,
assuming exercise of the underlying warrants; (iv) warrants to purchase 202,486
shares of Common Stock held by the Underwriter and distributees of the
Underwriter which were granted to the Underwriter in connection
8
with prior private financings; (v) warrants to purchase 545,727 shares of Common
Stock held by employees of Paramount Capital, Inc. which were granted to
Paramount Capital, Inc. in connection with a private financing; and (vi) options
to purchase 1,335,212 shares of Common Stock, including 986,650 shares granted
under its Amended and Restated 1993 Stock Option Plan (the "Plan"). In addition,
the Company has 513,350 shares of Common Stock reserved for issuance upon
exercise of options which are available to be granted under the Plan. Holders of
such warrants and options are likely to exercise them when, in all likelihood,
the Company could obtain additional capital on terms more favorable than those
provided by warrants and options. Further, while these warrants and options are
outstanding, the Company's ability to obtain additional financing on favorable
terms may be adversely affected. In addition, the Company has outstanding
764,321 shares of Class A Convertible Preferred Stock which is convertible into
2,123,114 shares of Common Stock and 4,850 shares of Class B Convertible
Preferred Stock which is currently convertible into 1,212,725 shares of Common
Stock. The holders of the Class A Preferred Stock and Class B Preferred Stock
are Selling Securityholders hereunder. See "SELLING SECURITYHOLDERS."
POSSIBLE DELISTING OF SECURITIES FROM THE NASDAQ STOCK MARKET. While the
Company's Common Stock meets the current Nasdaq listing requirements, there can
be no assurance that the Company will meet the criteria for continued listing.
Continued inclusion on Nasdaq generally requires that (i) the Company maintain
at least $2,000,000 in net tangible assets, a $35,000,000 market capitalization
or net income of at least $500,000 in two of the three prior years, (ii) at
least 500,000 shares in the public float valued at $1,000,000 or more, (iii) a
minimum Common Stock bid price of $1.00, (iv) at least two active market makers,
and (v) at least 300 shareholders of Common Stock. If the Company is unable to
satisfy Nasdaq's maintenance requirements, its securities may be delisted from
Nasdaq. In such event, trading, if any, in the Common Stock would thereafter be
conducted in the over-the-counter market in the so-called "pink sheets" or the
NASD's "Electronic Bulletin Board." Consequently, the liquidity of the Company's
securities could be impaired, not only in the number of securities which could
be bought and sold, but also through delays in the timing of transactions,
reduction in security analysts' and the news media's coverage of the Company and
lower prices for the Company's securities than might otherwise be attained.
POTENTIAL ADVERSE EFFECT OF REDEMPTION OF WARRANTS. The Warrants may be
redeemed by the Company at a redemption price of $.05 per Warrant upon not less
than 30 days' prior written notice if the closing bid price of the Common Stock
shall have averaged in excess of $7.30 per share for the Class A Warrants and
$9.80 per share with respect to the Class B Warrants, for 30 consecutive trading
days ending within 15 days of the notice. Redemption of the Warrants could force
the holders to exercise the Warrants and pay the exercise price therefor at a
time when it may be disadvantageous for the holders to do so, to sell the
Warrants at the then current market price when they might otherwise wish to hold
the Warrants, or to accept the redemption price which, at the time the Warrants
are called for redemption, is likely to be substantially less than the market
value of the Warrants.
CURRENT PROSPECTUS AND STATE REGISTRATION TO EXERCISE WARRANTS. Holders of
Warrants will only be able to exercise the Warrants if (i) a current prospectus
under the Securities Act relating to the securities underlying the Warrants is
then in effect and (ii) such securities are qualified for sale or exempt from
qualification under the applicable securities laws of the states in which the
various holders of Warrants reside. Although the Company has undertaken and
intends to use its best efforts to maintain a current prospectus covering the
securities underlying the Warrants, there can be no assurance that the Company
will be able to do so. The value of the Warrants may be greatly reduced if a
prospectus covering the securities issuable upon the exercise of the Warrants is
not kept current or if the securities are not qualified, or exempt from
qualification, in the states in which the holders of Warrants reside. If and
when the Warrants become redeemable by the terms thereof, the Company may
exercise its redemption right even if it is unable to qualify the underlying
securities for sale under all applicable state securities laws. Holders of
Warrants called for redemption residing in states where the underlying
securities have not been qualified for sale would generally still be able to
sell their Warrants at the then market price thereof.
RISKS OF LOW-PRICED STOCK. If the Company's securities were delisted from
Nasdaq (See "-- Possible Delisting of Securities from the Nasdaq Stock Market"),
they could become subject to Rule 15g-9 under the Exchange Act, which imposes
additional sales practice requirements on broker-dealers that sell such
9
securities except in transactions exempted by such Rule, including transactions
meeting the requirements of Rule 505 or 506 of Regulation D under the Securities
Act and transactions in which the purchaser is an institutional accredited
investor (as defined) or an established customer (as defined) of the broker or
dealer. For transactions covered by this rule, a broker-dealer must make a
special suitability determination for the purchaser and have received the
purchaser's written consent to the transaction prior to sale. Consequently, such
rule may adversely affect the ability of broker-dealers to sell the Company's
securities and may adversely affect the ability of purchasers in this offering
to sell any of the securities acquired hereby in the secondary market.
Commission regulations define a "penny stock" to be any non-Nasdaq equity
security that has a market price (as therein defined) of less than $5.00 per
share or with an exercise price of less than $5.00 per share, subject to certain
exceptions. For any transaction by a broker-dealer involving a penny stock,
unless exempt, the rules require delivery, prior to any transaction in a penny
stock, of a disclosure schedule prepared by the Commission relating to the penny
stock market. Disclosure is also required to be made about commissions payable
to both the broker-dealer and the registered representative and current
quotations for the securities. Finally, monthly statements are required to be
sent disclosing recent price information for the penny stock held in the account
and information on the limited market in penny stocks.
The foregoing required penny stock restrictions will not apply to the
Company's securities if such securities continue to be listed on Nasdaq and have
certain price and volume information provided on a current and continuing basis
or meet certain minimum net tangible assets or average revenue criteria. There
can be no assurance that the Company's securities will continue to qualify for
exemption from these restrictions. In any event, even if the Company's
securities were exempt from such restrictions, it would remain subject to
Section 15(b)(6) of the Exchange Act, which gives the Commission the authority
to prohibit any person that is engaged in unlawful conduct while participating
in a distribution of a penny stock from associating with a broker-dealer or
participating in a distribution of a penny stock, if the Commission finds that
such a restriction would be in the public interest. If the Company's securities
were subject to the rules on penny stocks, the market liquidity for the
Company's securities could be severely adversely affected.
EFFECTS OF CURRENT OFFERING ON MARKET PRICE. Future sales of Common Stock,
Class A Warrants and Class B Warrants in the public market by existing
stockholders pursuant to this shelf registration statement or otherwise, could
have an adverse effect on the price of the Company's securities. 22,027,022
shares of Common Stock, 810,991 Class A Warrants and 4,812,383 Class B Warrants
will have been registered hereby under the Securities Act of 1933, as amended,
for resale to the public, which constitute on a fully diluted basis
approximately 74.4%, 16.9% and 67.2% of the Company's Common Stock, Class A
Warrants and Class B Warrants, respectively. As of October 10, 1997, 543,320
shares of Common Stock underlying vested options are eligible for resale and an
additional 791,892 shares may be sold from time to time as additional
outstanding options vest. Sales of Common Stock or other securities, or the
possibility of such sales, in the public market may adversely affect the market
price of the Common Stock or the other securities offered hereby. Historically,
the Company's securities have been thinly traded. This low trading volume may
have had a significant effect on the market price of the Company's securities,
which may not be indicative of the market price in a more liquid market.
10
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sales of
Securities by the Selling Securityholders. In the event the outstanding Class A
Warrants and Class B Warrants being registered for resale hereby are exercised,
the Company will receive gross proceeds of approximately $3,835,000 and
$30,650,000 respectively. See "SELLING SECURITYHOLDERS" for a list of those
persons and entities receiving the proceeds from the sales of the Securities
offered hereby.
BACKGROUND OF THE COMPANY
OncoRx Inc. ("Old OncoRx") was founded in May 1993 to engage in the
discovery, development and marketing of products for the treatment of cancer and
cancer-related disorders. Prior to the Merger described below, Old OncoRx's
business consisted principally of entering into a license agreement with Yale
University (the "Yale/OncoRx Agreement') in August 1994. MelaRx Pharmaceuticals,
Inc. ("MelaRx") was formed in March 1992 to engage in the research and
development, pursuant to an agreement with Yale University (the "Yale/MelaRx
Agreement") of therapeutic, cosmetic and other products which are derived from
technology relating to melanin and the control of the effect of ultraviolet
radiation upon the skin and the related systems. In April 1995, Old OncoRx was
merged (the "Merger") into OncoRx Research Corp., a wholly-owned subsidiary of
MelaRx, and stockholders of Old OncoRx were issued 2,654,038 shares of Common
Stock and 23,859 shares of Preferred Stock of the Company, and an option to
acquire 750,000 shares of the Common Stock of Old OncoRx was converted into an
option to acquire 286,312 shares of Common Stock. Pursuant to the Merger, the
name of MelaRx was changed to OncoRx, Inc. Simultaneously therewith, each share
of Common Stock of MelaRx was converted into approximately 0.16 shares of Series
A Common Stock (resulting in 2,000,000 shares of outstanding Series A Common
Stock) and each option and warrant to acquire Common Stock was converted into
the right to receive approximately 0.16 shares of Series A Common Stock (the
"Recapitalization").
Additionally, prior to the Merger, certain founders of MelaRx deposited
710,994 of their shares of Series A Common Stock of the Company (after giving
effect to the Recapitalization) in escrow. The shares deposited in escrow were
canceled upon the closing of the Company's initial public offering in August
1995. Upon such cancellation, each of the remaining 1,289,006 shares of the
Series A Common Stock of the Company previously held by MelaRx stockholders were
adjusted to equal approximately 1.55 shares of Common Stock of the Company (a
total of 2,000,000 shares) and, as a result, the number of shares of outstanding
Common Stock remained unchanged after such cancellation. The number of shares
subject to options and warrants granted by MelaRx prior to the Merger were also
adjusted into the right to acquire approximately 1.55 shares of Common Stock for
each share of Series A Common Stock subject to such options or warrants.
In April 1996 the name of the Company was changed from OncoRx, Inc. to Vion
Pharmaceuticals, Inc.
The Company's executive offices are located at 4 Science Park, New Haven, CT
06511 and its telephone number is (203) 498-4210.
11
RECENT DEVELOPMENTS
Issuance of New Patent. In May 1997 the U.S. Patent and Trademark Office
issued a patent covering the method and use of Beta-L-Fd4C, the Company's novel
nucleoside analog against the Human Immunodeficiency Virus ("HIV"). This patent
complements an earlier patent issued relating to the composition of matter and
method of use against the Hepatitis B Virus ("HBV"). With the issuance of this
second patent the Company believes it has a strong proprietary position for this
potentially important new antiviral agent although there can be no assurance
that the Company's patented technologies will not infringe on the patents of
other persons or entities.
Promycin(R) Clinical Trial. The Company has recently broadened the scope of
the clinical trial of its anticancer agent Promycin(R) significantly to include
over 25 clinical trial sites in 5 European countries. This international
multicenter trial is expected to hasten accrual of patients and allow for
European registration filing within the timeframe of a U.S. filing, if not
sooner. The Phase III head and neck cancer trial compares standard radiation
therapy to Promycin(R) plus radiation therapy. In the trial, Promycin(R) is
administered as an intravenous injection during the six week course of radiation
therapy. This Phase III trial is expected to treat over 400 patients and if
successful, the Company expects to file a New Drug Application ("NDA") by 2000.
In Phase I/II clinical trial, the combination of Promycin(R) and radiation
therapy produced a 37% disease-free survival rate at five years among the
evaluable participants who suffered from head and neck cancer. The Phase III
trial is designed to detect a 15% difference in clinical response between the
two arms.
Private Placement of Class B Preferred Stock. On August 20, 1997 (the
"Closing Date"), the Company completed a private placement of 4,850 shares of
Class B Convertible Preferred Stock, at $1,000.00 per share, resulting in net
proceeds to the Company of $4,481,850. Each share of Class B Preferred Stock is
convertible into approximately 247 shares of Common Stock plus an accretion of
8% per annum. Shares of the Class B Preferred Stock may also be eligible, under
certain conditions, to receive dividends paid in Class C Preferred Stock. The
Class C Preferred Stock is convertible into shares of Common Stock at the
average closing bid price of the Company's Common Stock for thirty consecutive
business days ending on the Closing Date and is not entitled to dividends.
Termination of Option. In October 1997, the Company terminated a research
agreement with The Regents of the University of California on behalf of the
Berkeley Campus ("Berkeley") and determined not to proceed with negotiations to
obtain licenses or options to certain microfiltration and drug delivery
technology. The Company had previously sponsored certain research at Berkeley
and had negotiated an exclusive option to negotiate an exclusive license to the
microfiltration and drug delivery technology.
12
SELLING SECURITYHOLDERS
The following table sets forth certain information as of October 1, 1997
(except as otherwise indicated), as to the security ownership of the Selling
Securityholders. Except as set forth below, none of the Selling Securityholders
has had a material relationship with the Company or any of its predecessors or
affiliates for within the past three years. Unless otherwise indicated, each
Selling Stockholder will hold less than one percent of the applicable class of
securities being sold after the offering and is selling all of its securities of
the Company pursuant to this offering.
<TABLE>
<CAPTION>
CLASS A CLASS B COMMON
WARRANTS WARRANTS STOCK
NAME BEING SOLD BEING SOLD BEING SOLD
---- ---------- ---------- ----------
<S> <C> <C> <C>
CLASS A WARRANTHOLDERS (RESTRICTED)
Magid M. Abraham 3,437 3,437 6,874
William T. Anderson 13,750 13,750 27,500
Aries Domestic Fund L.P. 17,875 17,875 35,750
The Aries Trust 9,625 9,625 19,250
George T. Barton & Nancy L. Barton JTWROS 1,250 1,250 2,500
Mark Berger 155 155 310
David James Brown 2,500 2,500 5,000
Jay Cholost 157 157 314
Norman Ciment & Robert Grover & Warren
Tepper JTWROS 13,750 13,750 27,500
Howard Commander 1,250 1,250 2,500
J. Douglas Cox 625 625 1,250
Nathan Eisen & Rose Eisen JTWROS 27,500 27,500 55,000
Edward J. Farrell Jr. 312 312 624
Jeffrey Gilbert 13,750 13,750 27,500
Goldstein Family Loving Trust 27,500 27,500 55,000
Barbara Grae 41,250 41,250 82,500
Charles D. Greenstein 13,750 13,750 27,500
Tatiana Hirsu 13,750 13,750 27,500
Richard S. Incandela & Sharon Sue Incandela
Co-TTES of the Richard S. Incandela Trust
DTD 9/15/91 14,300 14,300 28,600
Gary W. Jenkins & Janice A. Jenkins JTWROS 650 650 1,300
Robert Katz(1) 22,500 22,500 45,000
Robert Klein & Myriam Gluck JTWROS 20,625 20,625 41,250
William S. Knapp & Jane Knapp JTWROS 13,750 13,750 27,500
Ray Kralovic 312 312 624
Joseph S. Kulpa 512 512 1,024
Gary R. Lamberg(2) 13,750 13,750 27,500
Ezra P. Mager 3,437 3,437 6,874
Robert A. Malkin 312 312 624
Matset Inc. 157 157 314
Frank K. Mayers(3) 13,750 13,750 27,500
Albert Milstein(4) 13,750 13,750 27,500
George Y. Montonaga & Irene M. Montonaga
JTTEN 2,000 2,000 4,000
James S. Mulholland Jr.(5) 2,500 2,500 5,000
</TABLE>
13
<TABLE>
<CAPTION>
CLASS A CLASS B COMMON
WARRANTS WARRANTS STOCK
NAME BEING SOLD BEING SOLD BEING SOLD
---- ---------- ---------- ----------
<S> <C> <C> <C>
Allen Notowitz 13,750 13,750 27,500
James R. Ratliff 2,500 2,500 5,000
Rodney L. Rich & Co., Inc. 13,750 13,750 27,500
Edward H. Rosen & Evelyn B. Rosen JTWROS 13,750 13,750 27,500
Roy Schaeffer & Marlena Schaeffer JTWROS(6) 41,250 41,250 82,500
A. Robert Schell 13,750 13,750 27,500
Louis Schell 16,500 16,500 33,000
Abraham Schreiber 13,750 13,750 27,500
E. Donald Shapiro(7) 13,750 13,750 27,500
Eugene Sukonick(8) 41,250 41,250 82,500
Frederick Winston 13,750 13,750 27,500
Martin Zelman(9) 13,750 13,750 27,500
CLASS A PREFERRED STOCKHOLDERS
GFL Performance Fund Ltd. 0 0 439,545
Phoenix Partners L.P.(10) 0 0 408,486
M. Kingdon Offshore NV(11) 0 0 356,498
Strome Partners, L.P. 0 0 261,667
Ardsley Partners Fund I, L.P.(12) 0 0 282,228
Ardsley Partners Fund II, L.P.(12) 0 0 274,798
Morgens Waterfall Vintiadis Investments
N.V.(10) 0 0 272,325
Betje Partners(10) 0 0 136,164
Kingdon Associates, L.P.(11) 0 0 118,834
Kingdon Partners, L.P.(11) 0 0 118,834
The Gifford Fund 0 0 84,909
Banque Unigestion 0 0 70,692
Mirza Mehdi 0 0 74,275
M.D. Sabbah 0 0 57,281
Olympus Securities, Ltd. 0 0 59,417
Faisal Finance 0 0 56,578
C.S.L. Associates, L.P. 0 0 47,539
The Hope Investment Company, Inc. 0 0 34,162
Roy and Marlena Schaeffer JTWROS (13) 0 0 37,142
Robert Klein and Myriam Gluck JTWROS 0 0 37,142
Schottenfeld Associates L.P. 0 0 35,656
Frederick J. Jaindl 0 0 7,000
W&P Bank & Trust Company Ltd. 0 0 27,778
Greenwood Partners Limited Partnership 0 0 29,006
Leeor Sabbah 0 0 28,662
Banque Franck S.A. 0 0 28,278
Irvine Capital Partners L.P. 0 0 20,800
Firebird Overseas, Ltd. 0 0 14,139
</TABLE>
14
<TABLE>
<CAPTION>
CLASS A CLASS B COMMON
WARRANTS WARRANTS STOCK
NAME BEING SOLD BEING SOLD BEING SOLD
---- ---------- ---------- ----------
<S> <C> <C> <C>
Susan Tauber Lemor 0 0 14,859
Aaron Speisman 0 0 13,889
169193 Canada Inc. 0 0 14,859
Roger S. Lash 0 0 14,859
Uzi Zucker 0 0 14,495
Amram Kass Defined Benefit Pension Plan 0 0 10,000
Lori Shapero 0 0 11,656
Scott G. Sandler 0 0 8,495
Stuart Gruber 0 0 7,070
Amnon & Caren Barness, JTWROS 0 0 7,248
Peter Grossman(14) 0 0 7,431
Steven N. Ostrovsky 0 0 2,548
Jerry Heymann 0 0 5,000
Paul D. and Rebecca L. Ostrovsky JTWROS 0 0 2,548
Paulette Tauber Mintz 0 0 7,431
Irwin Tauber 0 0 7,431
Mark Lawrence Dunetz 0 0 2,975
OTHER(15)
Hyman Doctor 0 0 1,250
Jack Henderson 0 0 2,500
Marilyn Gonzalez 0 0 2,500
Ann Korner 0 0 1,000
Michel Bergerac(16) 0 0 25,000
Walter Haeussler 0 0 8,750
E. Donald Shapiro(7) 0 0 25,000
Jean Bolognia 0 0 6,250
Ashok Chakraborty 0 0 3,000
Michael P. Osber 0 0 3,000
John Pawelek(17) 0 0 12,500
Stefano Sodi 0 0 1,500
James Platt 0 0 500
John Spears(18) 0 0 391,312
Morris Friedman(19) 0 0 8,676
Jay Kestenbaum(20) 0 0 12,215
Nathan Eisen 0 0 21,030
Albert Milstein(21) 0 0 24,431
Melvin L. Katten(22) 0 0 5,997
Norman Steinberg(23) 0 0 3,997
Yale University(24) 0 0 309,304
Sintong Pharmaceuticals U.S., Inc. 0 0 23,859
D.H. Blair Investment Banking Corp.(25) 275,000 550,000 1,075,000
Martin A. Bell(26) 0 0 18,649
</TABLE>
15
<TABLE>
<CAPTION>
CLASS A CLASS B COMMON
WARRANTS WARRANTS STOCK
NAME BEING SOLD BEING SOLD BEING SOLD
---- ---------- ---------- ----------
<S> <C> <C> <C>
Dov Perlyski 0 0 18,086
D.H. Blair Investment Banking Corp.(25) 0 0 18,649
Alan Stahler 0 0 43,516
Kalman Renov(26) 0 0 43,516
J. Morton Davis(26) 0 0 9,751
Michael Solomon 0 0 12,247
Richard Mish(27) 0 0 7,320
Alex Salm 0 0 4,505
Rich Elkin 0 0 12,951
Robert Fiandra 0 0 845
Mark Newman 0 0 564
Greg Carter 0 0 5,350
Elliot Scheier 0 0 1,127
David Lerner 0 0 1,127
Frank Monte 0 0 564
Richard Molinsky(28) 0 0 620
Joe Nesc 0 0 282
Morris Betesh 0 0 564
Joe Andrews 0 0 282
Cindy Wertheimer 0 0 1,971
Lindsay A. Rosenwald, M.D.(29) 0 0 227,458
Michael S. Weiss 0 0 40,929
Wayne L. Rubin 0 0 40,929
Jeffrey S. Levine 0 0 11,102
Joseph Edelman 0 0 68,941
Mark A. Abeshouse 0 0 11,228
Bernard Gross 0 0 7,128
Tim McInerney 0 0 1,587
Peter M. Kash 0 0 131,112
Scott Katzmann 0 0 1,799
Martin S. Kratchman 0 0 3,752
CLASS A WARRANTHOLDERS (OTHER)
Frank Adimari 0 220 40
Lawrence C. Bejnarowicz & Susan Bejnarowicz
JTTEN 0 20 40
S. McCoy Brown 0 1,320 2,640
Cede & Co. (FAST ACCOUNT) 0 3,711,024 7,422,048
Christine P. Colby 0 17 34
Douglas C. Floren Cust. David S. Floren
under the CT UNIF GIFT MIN ACT 0 2,200 4,400
Douglas C. Floren Cust. Clay L. Floren
Cust. under the CT UNIF GIFT MIN ACT 0 2,200 4,400
Joseph Friedman & Sylvia Friedman JTTEN 0 1,100 2,200
Daniel M. Hart Cust. West A Hart UGMA IL 0 1,100 2,200
</TABLE>
16
<TABLE>
<CAPTION>
CLASS A CLASS B COMMON
WARRANTS WARRANTS STOCK
NAME BEING SOLD BEING SOLD BEING SOLD
---- ---------- ---------- ----------
<S> <C> <C> <C>
Daniel M. Hart 0 1,100 2,200
Mark Hermsen 0 50 100
Mitchell S. Kramer 0 20 40
Thomas C. Noddings 0 11 22
Ruth M. Siegel Cust. Yoakov Yitzchok Siegel under
IL UNIF TRANS MIN ACT 0 200 400
Theodore R. Zeran 0 5,810 11,620
CLASS B WARRANTHOLDERS
Frank Adimari 0 0 220
Lawrence C. Bejnarowicz & Suzan Bejnarowicz
JTTEN 0 0 20
Cede & Co. (Fast Account) 0 0 3,151,267
Christine P. Colby 0 0 17
Douglas C. Floren Cust. Clay L. Floren under
the CT UNIF GIFT MIN ACT 0 0 2,200
Douglas C. Floren Cust. David S. Floren under
the CT UNIF GIFT MIN ACT 0 0 2,200
Joseph Friedman and Sylvia Frideman JTTEN 0 0 1,100
Herbert Harris 0 0 1,100
Daniel M. Hart Cust. West A. Hart Under the IL
UNIF TRANS MIN ACT 0 0 1,100
Daniel M. Hart 0 0 1,100
Mark Hermsen 0 0 50
Nicolaas M. Klaver & Barbara C. Klaver JT TEN 0 0 2,000
Mitchell S. Kramer 0 0 20
Thomas C. Noddings 0 0 11
Ruth M. Siegel Cust. Yoakov Yitzchok Siegel
UTMA IL 0 0 200
CLASS B PREFERRED STOCKHOLDERS(30)
Banque Edouard Constant SA 0 0 216,650
Elliott Associates, L.P. 0 0 721,700
Faisal Finance (Switzerland) S.A. 0 0 252,700
Gifford Fund Ltd. 0 0 360,850
JALAA Equities Limited Partnership 0 0 288,750
Marion Howard Schroeder 0 0 72,100
The Matthew Fund 0 0 108,150
Westgate International, L.P. 0 0 721,700
Greg Manocherian 0 0 36,050
Shoham Investments Ltd. 0 0 180,250
Global Bermuda Limited Partnership 0 0 180,250
Lakeshore International, Ltd. 0 0 360,850
</TABLE>
- ---------
(1) Mr. Katz is also the beneficial and record holder of an additional 6,000
shares of Common Stock, 6,000 Class A Warrants and 6,600 Class B Warrants.
(2) Mr. Lamberg is also the beneficial and record holder of an additional 6,500
shares of Common Stock, 7,150 Class A Warrants and 7,150 Class B Warrants.
17
(3) Mr. Mayers is also the beneficial and record holder of an additional 10,000
shares of Common Stock, 1,000 Class A Warrants and 11,000 Class B Warrants.
(4) Mr. Milstein is also the beneficial and record holder of additional 38,681
shares of Common Stock, 8,000 Class A Warrants and 8,000 Class B Warrants.
(5) Mr. Mulholland is also the joint beneficial holder and record holder with
his wife of an additional 10,000 shares of Common Stock.
(6) Mr. and Mrs. Schaeffer are also the joint beneficial holders of an
additional 40,000 shares of Common Stock, 10,000 Class A Warrants, 11,000
Class B Warrants and 12,500 shares of Class A Preferred Stock.
(7) Mr. Shapiro is a director of the Company. Including the securities set
forth herein, Mr. Shapiro is the beneficial holder of 72,200 shares of
Common Stock of the Company.
(8) Mr. Sukonick is also the beneficial and record holder of an additional
5,000 shares of Common Stock, 5,500 Class A Warrants and 5,500 Class B
Warrants.
(9) Mr. Zelman is also the beneficial and record holder of an additional 20,000
shares of Common Stock.
(10) Represents in the aggregate 8.6% of the outstanding Common Stock of the
Company. Edwin Morgens is the Managing Member of the general partner of
Phoenix Partners L.P. and is the Chairman of the investment advisors to
Morgens Waterfall Vintiadis Investments N.V. and Betje Partners. Mr.
Morgens disclaims beneficial ownership of all indicated shares.
(11) Represents in the aggregate 6.4% of the outstanding Common Stock of the
Company. Kingdon Capital Management Corp. ("KCMC") is a general partner of
Kingdon Partners, L.P. and Kingdon Associates, L.P. and is the investment
advisor to M. Kingdon Offshore NV (collectively, the "Kingdon Funds"). As a
result of such relationships, KCMC may be deemed to beneficially own the
shares offered for sale by the Kingdon Funds, which consists of more than
5% of the Company's Common Stock.
(12) Represents in the aggregate 6.0% of the outstanding Common Stock of the
Company. Kevin M. McCormack is the general partner of both limited
partnerships and disclaims beneficial ownership of the indicated shares.
(13) Mr. and Mrs. Schaeffer are also the joint beneficial holders of an
additional 40,000 shares of Common Stock, 51,250 Class A Warrants, and
11,000 Class B Warrants.
(14) Mr. Grossman is also the beneficial holder of an additional 12,500 shares
of Common Stock.
(15) Information is as of August 15, 1997.
(16) Mr. Bergerac is a director of the Company. Including the securities set
forth herein, Mr. Bergerac is the beneficial holder of 27,500 shares of
Common Stock of the Company.
(17) Mr. Pawelek is a consultant to the Company and is also the beneficial and
record holder of an additional 22,500 Class B Warrants.
(18) Mr. Spears is President, Chief Executive Officer and a Director of the
Company. In addition to the securities being sold herein, Mr. Spears holds
23,100 shares issuable upon exercise of warrants, representing in the
aggregate 4.5% of the outstanding Common Stock of the Company.
(19) Mr. Friedman is also the beneficial and record holder of an additional
14,500 shares of Common Stock, 2,000 Class A Warrants and 2,000 Class B
Warrants.
(20) Mr. Kestenbaum is also the beneficial and record holder of an additional
17,500 shares of Common Stock, 5,000 Class A Warrants and 5,000 Class B
Warrants.
(21) Mr. Milstein is also the beneficial and record holder of an additional
14,250 shares of Common Stock, 21,750 Class A Warrants and 8,000 Class B
Warrants.
18
(22) Mr. Katten is also the beneficial and record holder of an additional 6,125
shares of Common Stock, 3,000 Class A Warrants and 3,000 Class B Warrants.
(23) Mr. Steinberg is also the beneficial and record holder of an additional
3,125 shares of Common Stock and is also the beneficial holder, through an
IRA account, of an additional 2,000 shares of Common Stock, 2,000 Class A
Warrants and 2,000 Class B Warrants.
(24) Yale University is a party to various license agreements with the Company.
See "RISK FACTORS."
(25) D.H. Blair Investment Banking Corp. is a consultant to the Company and was
the underwriter of the Company's initial public offering in August 1995 and
was placement agent for certain previous private placements.
(26) This stockholder is an officer of D.H. Blair Investment Banking Corp. See
"Note 25."
(27) Mr. Mish is also the beneficial holder of 2,500 shares of Common Stock,
2,750 Class A Warrants and 2,750 Class B Warrants.
(28) Mr. Molinksy is also the beneficial and record holder of an additional
12,250 shares of Common Stock.
(29) Dr. Rosenwald is the Chairman and sole shareholder of Paramount Capital,
Inc. which is a financial advisor to the Company and acted as placement
agent for the Company's May 1995 private placement of Class A Preferred
Stock. He is also the beneficial and record holder of an additional 29,509
shares of Common Stock. Dr. Rosenwald may also be deemed the beneficial
holder of 22,528 shares of Common Stock held by his wife as custodian for
his children. Dr. Rosenwald disclaims beneficial ownership of all shares
held by his wife and children.
(30) Share amounts include shares issuable upon effect of certain anti-dilution
rights.
19
PLAN OF DISTRIBUTION
The Company is registering the Securities on behalf of the Selling
Securityholders. All costs, expenses and fees in connection with the
registration of the Securities offered hereby will be borne by the Company.
Brokerage commissions, if any, attributable to the sale of the Securities will
be borne by the Selling Securityholders.
Sales of Securities may be effected from time to time in transactions (which
may include block transactions) on the NASDAQ SmallCap MarketSM, in negotiated
transactions, or a combination of such methods of sale, at fixed prices, at
market prices prevailing at the time of sale, or at negotiated prices. The
Selling Securityholders may effect such transactions by selling Securities
directly to purchasers or to or through broker-dealers which may act as agents
or principals. Such broker-dealers may receive compensation in the form of
discounts, concessions, or commissions from the Selling Securityholders and/or
the purchasers of Securities for whom such broker-dealers may act as agents or
to whom they sell as principal, or both (which compensation as to a particular
broker-dealer might be in excess of customary commissions). The Selling
Securityholders and any broker-dealers that act in connection with the sale of
the Securities might be deemed to be "underwriters" within the meaning of
Section 2(11) of the Securities Act and any commission received by them and any
profit on the resale of the Securities as principal might be deemed to be
underwriting discounts and commissions under the Securities Act. The Selling
Securityholders may agree to indemnify any agent, dealer or broker-dealer that
participates in transactions involving sales of the Securities against certain
liabilities, including liabilities arising under the Securities Act. Liabilities
under the federal securities laws cannot be waived.
Because the Selling Securityholders may be deemed to be "underwriters"
within the meaning of Section 2(11) of the Securities Act, the Selling
Securityholders will be subject to prospectus delivery requirements under the
Securities Act. Furthermore, in the event of a "distribution" of the shares,
such Selling Securityholder, any selling broker or dealer and any "affiliated
purchasers" may be subject to Regulation M under the Exchange Act, which
Regulation would prohibit, with certain exceptions, any such person from bidding
for or purchasing any security which is the subject of such distribution until
his participation in that distribution is completed. In addition, Regulation M
also prohibits any bid or purchase for the purpose of pegging, fixing or
stabilizing the price of Common Stock in connection with this offering.
LEGAL MATTERS
Certain legal matters with respect to the validity of the Securities offered
hereby have been passed upon for the Company by Wiggin & Dana, New Haven,
Connecticut.
EXPERTS
The consolidated financial statements of Vion Pharmaceuticals, Inc. at
December 31, 1996 and for the years ended December 31, 1996 and 1995 and for the
period May 1, 1994 (commencement of operations) to December 31, 1996,
incorporated by reference in this Prospectus and Registration Statement have
been audited by Ernst & Young LLP, independent auditors, as set forth in their
report thereon (which contains an explanatory paragraph with respect to the
Company's ability to continue as a going concern) and are incorporated by
reference in reliance upon such report given upon the authority of such firm as
experts in accounting and auditing.
20
================================================================================
NO PERSON IS AUTHORIZED IN CONNECTION WITH ANY OFFERING MADE HEREBY TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS, AND,
IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS
HAVING BEEN AUTHORIZED BY THE COMPANY. THIS PROSPECTUS DOES NOT CONSTITUTE AN
OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITY OTHER THAN THE
SHARES OFFERED HEREBY, NOR DOES IT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION
OF AN OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY TO ANY PERSON IN ANY
JURISDICTION IN WHICH IT IS UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION.
NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL UNDER
ANY CIRCUMSTANCES CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN
IS CORRECT AS OF ANY DATE SUBSEQUENT TO THE DATE HEREOF.
----------
TABLE OF CONTENTS
PAGE
----
Available Information ..................................... 2
Incorporation of Certain Documents by
Reference ............................................... 2
Risk Factors .............................................. 3
Use of Proceeds ........................................... 11
Background of the Company ................................. 11
Recent Developments ....................................... 12
Selling Securityholders ................................... 13
Plan of Distribution ...................................... 20
Legal Matters ............................................. 20
Experts ................................................... 20
================================================================================
================================================================================
VION PHARMACEUTICALS, INC.
22,027,022 SHARES OF COMMON STOCK
810,991 REDEEMABLE CLASS A WARRANTS
4,812,383 REDEEMABLE CLASS B WARRANTS
----------------
PROSPECTUS
----------------
NOVEMBER 3, 1997
================================================================================
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The expenses payable by the Company in connection with the distribution of
the securities being registered hereby are as follows (asterisks indicate an
estimate):
<TABLE>
<CAPTION>
AMOUNT
------
<S> <C>
SEC Registration Fee ........................ $22,677.37
Printing and Engraving Expenses ............. 10,000.00*
Accounting Fees and Expenses ................ 5,000.00*
Legal Fees and Expenses ..................... 22,000.00*
Blue Sky Fees and Expenses .................. 5,000.00*
Miscellaneous Expenses ...................... 322.63*
----------
Total .................................... $65,000.00*
==========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Certificate of Incorporation and By-Laws of the Registrant provide that
the Registrant shall indemnify any person to the full extent permitted by the
Delaware General Corporation Law (the "GCL"). Section 145 of the GCL, relating
to indemnification, is hereby incorporated herein by reference.
In accordance with Section 102(a)(7) of the GCL, the Certificate of
Incorporation of the Registrant eliminates the personal liability of directors
to the Registrant or its stockholders for monetary damages for breach of
fiduciary duty as a director with certain limited exceptions set forth in
Section 102(a)(7).
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<S> <C>
2.1 -- Agreement and Plan of Merger among MelaRx Pharmaceuticals, Inc.,
OncoRx Research Corp. and OncoRx, Inc. dated as of April 19, 1995(1)
2.2 -- Certificate of Merger, dated April 20, 1995(1)
4.1 -- Form of Bridge Note(1)
4.2 -- Form of Warrant Agreement for Warrants issued in connection with
the bridge financing(1)
4.3 -- Form of Underwriter's Unit Purchase Option(1)
4.4 -- Form of Placement Agent's Warrant(1)
4.5 -- Form of Warrant Agreement for Class A and Class B Warrants(1)
5.1 -- Opinion of Wiggin & Dana
23.1 -- Consent of Ernst & Young L.L.P.
23.2 -- Consent of Wiggin & Dana (included in Exhibit 5.1)
24.1 -- Power of Attorney (included on signature page)*
</TABLE>
- -------
* Previously filed.
(1) Incorporated by reference to the Company's Registration Statement on Form
SB-2 (File No. 33-93468), effective August 14, 1995.
II-1
ITEM 17. UNDERTAKINGS
(1) The undersigned Registrant hereby undertakes that it will:
(a) File, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement to:
(i) Include any prospectus required by Section 10(a)(3) of the
Securities Act,
(ii) Reflect in the prospectus any facts or events which,
individually or together, represent a fundamental change in the
information in the registration statement, and
(iii) Include any additional or changed material information on the
plan of distribution.
(b) For determining liability under the Securities Act, treat each
post-effective amendment as a new registration statement of the securities
offered, and the offering of the securities at that time to be the initial
bona fide offering.
(c) File a post-effective amendment to remove from registration any of
the securities that remain unsold at the end of this offering.
(2) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
(3) The undersigned registrant hereby undertakes that it will:
(a) For determining any liability under the Securities Act, treat the
information omitted from the form of prospectus filed as part of this
Registration Statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4), or
497(h) under the Securities Act as part of this registration statement as of
the time it was declared effective.
(b) For determining any liability under the Securities Act, treat each
post-effective amendment that contains a form of prospectus as a new
registration statement for the securities offered in the registration
statement, and the offering of such securities at that time as the initial
bona fide offering of those securities.
II-2
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED, THE
REGISTRANT CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL
OF THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS REGISTRATION
STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED, IN THE CITY OF NEW HAVEN, STATE OF CONNECTICUT ON OCTOBER 31, 1997.
VION PHARMACEUTICALS, INC.
(Registrant)
By: /s/ JOHN A. SPEARS
---------------------------------
JOHN A. SPEARS
PRESIDENT AND CHIEF EXECUTIVE OFFICER
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATES INDICATED.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
* Chairman of the Board October 31, 1997
- ------------------------------
WILLIAM R. MILLER
/s/ John A. Spears Director, President and October 31, 1997
- ------------------------------ Chief Executive Officer,
JOHN A. SPEARS (Principal Executive Officer)
/s/ Thomas E. Klein Vice President -- Finance October 31, 1997
- ------------------------------ and Chief Financial Officer
THOMAS E. KLEIN (Principal Accounting Officer)
Director
- ------------------------------
MICHEL C. BERGERAC
* Director October 31, 1997
- ------------------------------
FRANK T. CARY
Director
- ------------------------------
A.E. COHEN
* Director October 31, 1997
- ------------------------------
JAMES FERGUSON
Director
- ------------------------------
MICHAEL C. KENT
* Director October 31, 1997
- ------------------------------
ALAN C. SARTORELLI
Director
- ------------------------------
E. DONALD SHAPIRO
* Director October 31, 1997
- ------------------------------
WALTER WRISTON
* By: /s/ Thomas E. Klein
- ------------------------------
Thomas E. Klein
Attorney-in-fact
</TABLE>
II-3
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------ -----------
<S> <C>
2.1 -- Agreement and Plan of Merger among MelaRx Pharmaceuticals, Inc., OncoRx Research
Corp. and OncoRx, Inc. dated as of April 19, 1995(1)
2.2 -- Certificate of Merger, dated April 20, 1995(1)
4.1 -- Form of Bridge Note(1)
4.2 -- Form of Warrant Agreement for Warrants issued in connection with the bridge financing(1)
4.3 -- Form of Underwriter's Unit Purchase Option(1)
4.4 -- Form of Placement Agent's Warrant(1)
4.5 -- Form of Warrant Agreement for Class A and Class B Warrants(1)
5.1 -- Opinion of Wiggin & Dana
23.1 -- Consent of Ernst & Young L.L.P.
23.2 -- Consent of Wiggin & Dana (included in Exhibit 5.1)
24.1 -- Power of Attorney (included on signature page)*
</TABLE>
- ---------
* Previously filed.
(1) Incorporated by reference to the Company's Registration Statement on Form
SB-2 (File No. 33-93468), effective August 14, 1995.
Wiggin & Dana
One Century Tower
P.O. Box 1832
New Haven, Connecticut
06508-1832
Telephone 203 498 4400
Telefax 203 782 2889
October 31, 1997
Vion Pharmaceuticals, Inc.
4 Science Park
New Haven, CT 06511
Ladies and Gentleman:
We refer to Amendment No. 1 to the Registration Statement on Form S-3
(No. 333-37941) (the "Registration Statement") to be filed by Vion
Pharmaceuticals, Inc. (the "Company") with the Securities and Exchange
Commission under the Securitities Act of 1933, as amended, relating to
22,027,022 shares of Common Stock, $.01 par value per share, of the Company (the
"Common Stock"), 810,991 Redeemable Class A Warrants (the " Class A Warrants")
and 4,812,383 Redeemable Class B Warrants (the "Class B Warrants")(the Class A
Warrants and Class B Warrants, collectively, the "Warrants", and the Common
Stock and the Warrants, collectively, the "Securities").
As counsel for the Company, we have examined such corporate records,
other documents and such questions of law as we have considered necessary or
appropriate for the purpose of this opinion and, upon the basis of such
examination, advise you that, in our opinion the Securities are legally issued,
fully paid and non-assessable, or when issued upon exercise of Warrants or other
convertible securities in accordance with the terms thereof, will be legally
issued, fully paid and non-assessable.
We consent to the filing of this opinion as an exhibit to the
Registration Statement and the reference to this firm under the caption "Legal
Matters" in the Prospectus contained therein. This consent is not to be
construed as an admission that we are a person whose consent is required to be
filed with the Registration Statement under the provisions of the Securities Act
of 1933.
Very truly yours,
/S/ Wiggin & Dana
EXHIBIT 23.1
------------
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in Amendment
No.1 to the Registration Statement (Form S-3 No. 333-37941) and related
Prospectus of Vion Pharmaceuticals, Inc. for the registration of shares of its
common stock, Redeemable Class A Warrants, and Redeemable Class B Warrants and
to the incorporation by reference therein of our report dated February 12, 1997
with respect to the consolidated financial statements of Vion Pharmaceuticals,
Inc. included in its Annual Report (Form 10-KSB) for the year ended December 31,
1996, filed with the Securities and Exchange Commission.
/s/ ERNST & YOUNG LLP
Hartford, Connecticut
October 30, 1997
