<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[x] Quarterly Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended June 30, 1997, or
[ ] Transition Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from to .
-------- -----------
COMMISSION FILE NO.: 0-25978
---------
THERAPEUTIC ANTIBODIES INC.
------------------------------------------------------
(Exact Name of Registrant as Specified in Its Charter)
DELAWARE 62-1212485
------------------------------- -------------------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
1207 17TH AVENUE SOUTH, SUITE 103
NASHVILLE, TENNESSEE 37212
---------------------------------- --------------
(Address of Principal Executive Offices) (Zip Code)
(615) 327-1027
---------------------------------
(Registrant's Telephone Number,
Including Area Code)
NOT APPLICABLE
--------------------------------------------------------
(Former Name, Former Address and Former Fiscal Year,
if Changed Since Last Report)
Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
YES X NO
---- ----
As of August 11, 1997, 23,181,990 shares of the registrant's Common Stock
were outstanding.
<PAGE> 2
PART I
FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
THERAPEUTIC ANTIBODIES INC. AND SUBSIDIARIES
(A Development Stage Company)
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
<TABLE>
<CAPTION>
ASSETS
June 30, 1997 December 31, 1996
------------- -----------------
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 5,698,092 $ 20,502,536
Short-term investments 8,848,193 2,002,266
Trade receivables 128,830 101,281
Value added tax receivable 211,478 251,186
Inventories 485,829 400,167
Other current assets 573,478 474,412
------------ ------------
Total current assets 15,945,900 23,731,848
Property and equipment, net 11,950,117 12,682,680
Patent costs, net 629,180 529,228
Other assets, net 199,036 236,234
------------ ------------
Total assets $ 28,724,233 $ 37,179,990
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses $ 950,311 $ 936,591
Accrued interest 259,912 161,367
Current portion of notes payable 1,266,555 1,446,327
------------ ------------
Total current liabilities 2,476,778 2,544,285
Notes payable, net of current portion 8,042,461 8,592,755
Deferred revenue 582,671 656,170
Other liabilities 166,450 171,250
------------ ------------
Total liabilities 11,268,360 11,964,460
------------ ------------
Stockholders' equity:
Common stock - par value $.001 per share; 30,000,000 shares authorized; 23,178,323 -
June 30, 1997 and 22,353,692 - December 31, 1996 issued and outstanding 23,178 22,354
Additional paid-in capital 68,231,598 67,082,048
Deficit accumulated during the development stage (1984-1997) (51,200,389) (42,564,665)
Cumulative translation adjustment 401,486 675,793
------------ ------------
Total stockholders' equity 17,455,873 25,215,530
------------ ------------
Total liabilities and stockholders' equity $ 28,724,233 $ 37,179,990
============ ============
</TABLE>
The accompanying notes are an integral part of the financial statements.
2
<PAGE> 3
THERAPEUTIC ANTIBODIES INC. AND SUBSIDIARIES
(A Development Stage Company)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
For the Cumulative
For the Six Months Ended For the Three Months Ended Development Stage
June 30, June 30, from August 10, 1984
---------------------------- ---------------------------- (inception) Through
1997 1996 1997 1996 June 30, 1997
------------ ------------ ------------ ------------ ------------------
<S> <C> <C> <C> <C> <C>
Revenues:
Sales and contract revenue $ 219,195 $ 222,995 $ 131,780 $ 186,235 $ 2,617,424
Licensing revenue 62,305 - - - 305,805
Interest income 488,230 32,908 204,372 13,913 1,524,405
Grant income 20,432 97,853 10,226 88,281 547,382
Value-added tax and insurance recoveries - - - - 577,170
Foreign currency gains - - 28,297 - 1,785,984
Other 32,636 37,104 17,479 22,747 173,442
------------ ------------ ------------ ------------ ------------
822,798 390,860 392,154 311,176 7,531,612
------------ ------------ ------------ ------------ ------------
Expenses:
Cost of sales and contract revenue 73,453 56,182 20,793 46,511 507,870
Research and development 5,474,934 3,947,420 2,884,248 2,222,349 36,679,996
General and administrative 1,630,240 1,171,726 988,568 611,934 10,386,909
Marketing and distribution 246,935 169,333 159,281 107,271 1,608,890
Depreciation and amortization 771,414 701,784 403,662 368,584 4,639,162
Interest 535,359 607,539 252,992 292,734 3,263,983
Debt conversion expense - 801,597 - - 801,597
Foreign currency losses 715,691 - - - 715,691
Other 10,496 - 10,496 - 127,903
------------ ------------ ------------ ------------ ------------
9,458,522 7,455,581 4,720,040 3,649,383 58,732,001
------------ ------------ ------------ ------------ ------------
Net loss $ (8,635,724) $ (7,064,721) $ (4,327,886) $ (3,338,207) $(51,200,389)
============ ============ ============ ============ ============
Net loss per share $ (0.38) $ (0.42) $ (0.19) $ (0.19) $ (5.43)
============ ============ ============ ============ ============
Weighted average shares used in
computing net loss per share 22,569,850 17,001,819 22,776,008 17,154,294 9,424,029
============ ============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of the financial statements.
3
<PAGE> 4
THERAPEUTIC ANTIBODIES INC. AND SUBSIDIARIES
(A Development Stage Company)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
For the Cumulative
Development Stage
For the Six Months Ended from August 10, 1984
June 30, (Inception) Through
1997 1996 June 30, 1997
------------ ----------- --------------------
<S> <C> <C> <C>
Cash flows from operating activities:
Net loss $ (8,635,724) $(7,064,721) $(51,200,389)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization 771,414 701,784 4,639,162
Foreign currency (gain) loss 715,691 -- (1,070,293)
Warrant expense -- -- 193,994
Compensation expense 5,001 -- 67,432
Debt conversion expense -- 801,597 801,597
Changes in:
Trade receivable 2,737 (129,710) (72,355)
Inventories (85,663) (5,656) (371,656)
Other current assets (102,348) 57,509 (571,071)
Accounts payable and accrued expenses 22,883 (81,875) 929,715
Accrued interest 105,405 128,786 882,407
Deferred revenue (47,179) -- 266,491
Other -- -- (43,489)
------------ ----------- ------------
Net cash used in operating activities (7,247,783) (5,592,286) (45,548,455)
------------ ----------- ------------
Cash flows from investing activities:
Purchase of property and equipment (544,758) (796,320) (12,531,201)
Patent costs (107,802) (80,331) (659,090)
Purchase of short term investments (8,155,045) -- (10,157,311)
Maturity of short term investments 1,000,000 -- 1,000,000
Other -- (31,908) 69,750
------------ ----------- ------------
Net cash used in investing activities (7,807,605) (908,559) (22,277,852)
------------ ----------- ------------
Cash flows from financing activities:
Proceeds from notes payable 42,200 5,538,772 15,833,600
Payments on notes payable (556,461) (946,326) (5,434,721)
Proceeds from line of credit 8,143 -- 3,317,524
Payments on line of credit (100,296) (1,012,076) (3,309,233)
Proceeds from convertible debt, net -- 1,081,732 9,655,000
Payments on convertible debt -- -- (4,320,325)
Proceeds from issuance of stock, net 1,145,373 610,022 56,798,867
Proceeds from issuance of warrants -- -- 65,000
Other -- -- (186,782)
------------ ----------- ------------
Net cash provided by financing activities 538,959 5,272,124 72,418,930
------------ ----------- ------------
Effect of exchange rate changes on cash and cash equivalents (288,015) (426) 1,105,469
------------ ----------- ------------
Net increase (decrease) in cash and cash equivalents (14,804,444) (1,229,147) 5,698,092
Cash and cash equivalents at beginning of period 20,502,536 3,397,082 --
------------ ----------- ------------
Cash and cash equivalents at end of period $ 5,698,092 $ 2,167,935 $ 5,698,092
============ =========== ============
</TABLE>
The accompanying notes are an integral part of the financial statements.
4
<PAGE> 5
THERAPEUTIC ANTIBODIES INC. AND SUBSIDIARIES
(A Development Stage Company)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
JUNE 30, 1997
NOTE 1 - BASIS OF PRESENTATION
The accompanying interim financial statements are unaudited, but include all
adjustments (consisting of normal recurring accruals) which are, in the opinion
of management, necessary for a fair statement of the results for such periods.
The unaudited interim consolidated financial statements should be read in
conjunction with the audited December 31, 1996 consolidated financial statements
of the Company. The December 31, 1996 condensed consolidated balance sheet data
was derived from audited financial statements, but does not include all
disclosures required by generally accepted accounting principles.
The results of operations for the interim periods are not necessarily indicative
of the results to be expected for the full year ending December 31, 1997.
Certain reclassifications were made to the three month and six month financial
statements to conform with the 1997 presentation. The reclassifications had no
effect on total assets, liabilities, net loss or stockholders' equity.
NOTE 2 - RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
During February 1997, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 128, "Earnings Per Share" ("SFAS No.
128"). The Company will adopt SFAS No. 128 during the fourth quarter of 1997 as
required and does not expect it to have a material impact on the calculation of
net income per share.
During June 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 130, "Reporting Comprehensive Income" ("SFAS
No. 130") and Statement of Financial Accounting Standards No. 131 "Disclosures
about Segments of an Enterprise and Related Information" ("SFAS No. 131"). The
Company will adopt SFAS No. 130 and SFAS No. 131 in 1998 as required. Because
these standards require only disclosure of certain additional information, the
effect of adoption will not have a significant impact on the Company's financial
position.
5
<PAGE> 6
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE BOARD OF DIRECTORS
THERAPEUTIC ANTIBODIES INC.
We have reviewed the condensed consolidated balance sheet of Therapeutic
Antibodies Inc. and Subsidiaries at June 30, 1997 and the related condensed
consolidated statement of operations and condensed consolidated statement of
cash flows for the three-month and six-month periods then ended. These financial
statements are the responsibility of the Company's management.
We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in accordance
with generally accepted accounting standards, the objective of which is the
expression of an opinion regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to the financial statements referred to above for them to be in
conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet at December 31, 1996 and the related
consolidated statements of operations, stockholders' equity and cash flows for
the year then ended (not expressed herein); and in our report dated March 7,
1997, we expressed an unqualified opinion on those consolidated financial
statements. In our opinion, the information set forth in the accompanying
condensed consolidated balance sheet as of December 31, 1996, is fairly stated,
in all material respects, in relation to the consolidated balance sheet from
which it has been derived.
/s/ COOPERS & LYBRAND L.L.P.
COOPERS & LYBRAND L.L.P.
Louisville, Kentucky
August 11, 1997
6
<PAGE> 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion and analysis of the financial condition and results of
operations of the Company should be read in conjunction with the financial
statements and notes thereto. This discussion and analysis contains both
historical and forward looking information. The forward looking statements are
made pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. Forward looking statements may be significantly impacted by
certain risks and uncertainties, and there can be no assurance that other
factors will not affect the accuracy of such forward-looking statements. While
it is impossible to identify all such factors, factors which could cause actual
results to differ materially from those estimated by the Company include but are
not limited to, changes on the regulation of the pharmaceutical industry, both
in the United States and internationally, changes in pharmaceutical product
testing or approval standards, both in the United States and internationally,
competitive pressures on the pharmaceutical industry and the Company's response
thereto, general conditions in the economy and capital markets, and other
factors which may be identified from time to time in the Company's Securities
and Exchange Commission filings and other public announcements.
GENERAL
Therapeutic Antibodies Inc. ("TAb" or the "Company") has been in the
development stage since inception in 1984, devoting its efforts and resources to
drug discovery and development programs relating to the development of highly
purified, polyclonal antibodies for the treatment of disease. Since inception
the Company's revenues have been from contract agreements with corporate
partners, product sales, grant income, interest income, and insurance and value
added tax recoveries. Net losses have been incurred each year since its
inception and the Company expects to continue to incur operating losses during
at least the next year due to continued spending on research, product
development and increasing requirements for process development, preclinical and
clinical testing, regulatory compliance, manufacturing activities and
administration. The Company may require additional financing until product sales
or licensing fees are sufficient to generate positive cash flows from
operations.
The Company conducts its operations from its headquarters in the United
States and through subsidiaries located in the United Kingdom, Australia and New
Zealand. International operations are primarily located in the United Kingdom.
RESULTS OF OPERATIONS
Three Months Ended June 30, 1997 Compared to Three Months Ended June 30, 1996
Revenues for the three months ended June 30, 1997 increased by 26% to
$392,000 from $311,000 for the three months ending June 30, 1996. The increase
in revenues in the second quarter of 1997 is attributed to increases in interest
income. In the second quarter of 1997, interest income increased to $204,000
from $14,000 in the second quarter of 1996, reflecting additional cash and short
term investment holdings from the proceeds of the Company's initial public
offering of Common Stock in the United Kingdom in July 1996. Sales and contract
revenue decreased to $132,000 for the quarter ended June 30, 1997 from $186,000
for the quarter ended June 30, 1996 due largely to a decrease in sales of
ViperaTAb(TM), the Company's European antivenom. Sales of ViperaTAb(TM) in 1996
exceeded the actual use of the drug to treat snake bite in 1996, as hospitals
added ViperaTAb(TM) to their inventories. Therefore, the Company expects 1997
ViperaTAb(TM) sales to be lower than 1996.
7
<PAGE> 8
Expenses increased by 29% to $4,720,000 for the quarter ending June 30,
1997, from $3,649,000 in the second quarter of 1996. Research and development
expenses, the largest component of TAb's expenses, increased by 29% to
$2,884,000 from $2,222,000 in the quarter ending June 30, 1996, as a result of
increased development activities primarily associated with CroTAb(TM),
CytoTAb(TM) and DigiTAb(TM). These costs are related to manufacturing TAb's
products for clinical trials, conducting clinical trials and ensuring that the
necessary quality control and assurance procedures are in place. Costs
associated with regulatory compliance, a component of research and development
expenses, have also increased as more of the Company's products enter advanced
stages of development and as CroTAb(TM) progresses through the FDA licensing
process.
General and administrative expenses in the second quarter of 1997
increased by 62% to $989,000 from $612,000 in the quarter ending June 30, 1996,
as a result of additional costs required since the Company's Common Stock began
publicly trading in July 1996.
Marketing expenses in the quarter ended June 30, 1997, increased by 48%
to $159,000 compared to $107,000 in the second quarter of 1996 due to increased
personnel and business development activities.
Interest expense in the quarter ending June 30, 1997, decreased by 14%
to $253,000 from $293,000 in the second quarter of 1996 due to repayment by the
Company of approximately $4,750,000 of debt obligations in the third and fourth
quarters of 1996.
In the quarter ended June 30, 1997, the Company recorded foreign
currency gains of $28,000. These gains were the result of changes in the UK and
Australian exchange rates from March 31, 1997 to June 30, 1997 on the Company's
holdings of cash in British pounds sterling and Australian dollars.
The Company's net loss for the quarter ending June 30, 1997, was $4.3
million compared to a net loss of $3.3 million for the quarter ending June 30,
1996. This increase was due to the activities described above.
Six Months Ended June 30, 1997 Compared to Six Months Ended June 30, 1996
TAb's revenues for the first six months of 1997 increased by 111% to
$823,000 from $391,000 for the same period of 1996. The increase in revenues in
the first six months of 1997 is attributed to increases in interest income and
licensing fees. The increase in interest income to $488,000 in the first six
months of 1997 from $33,000 in the first six months of 1996 reflects additional
cash and short term investment holdings from the proceeds of the Company's
initial public offering of Common Stock in the United Kingdom in July 1996. TAb
received a one-time licensing fee of $62,000 in the first six months of 1997 for
the execution of a collaboration agreement for BrownTAb(TM), the Company's
Australian Brown snake antivenom. Sales and contract revenue of $219,000 for the
six months ended June 30, 1997 remained even with the amount in the first six
months of 1996 of $223,000 as higher sales of EchiTAb(TM) offset lower sales of
ViperaTAb(TM).
Expenses for the first half of 1997 increased by 27% to $9,459,000 from
$7,456,000 for the same period in 1996. Research and development expenses during
the same periods increased by 39% to $5,475,000 from $3,947,000 as a result of
increased development activities primarily associated with CroTAb(TM),
CytoTAb(TM) and DigiTAb(TM). These costs are related to manufacturing TAb's
products for clinical trials, conducting clinical trials and ensuring that the
necessary quality control and assurance procedures are in place. Costs
associated with regulatory compliance, a component of research and development
expenses, have also increased as more of the Company's products enter advanced
stages of development and as CroTAb(TM) progresses through the FDA licensing
process.
8
<PAGE> 9
General and administrative expenses for the first half of 1997
increased by 39% to $1,630,000 from $1,172,000 for the first half of 1996. This
increase relates primarily to additional costs required since the Company's
Common Stock began publicly trading in July 1996.
Marketing and distribution expenses increased by 46% to $247,000 in the
first half of 1997 from $169,000 in the first half of 1996 due to increased
personnel and business development activities.
Interest expense in the six months ending June 30, 1997, decreased by
12% to $535,000 from $608,000 in the first six months of 1997 due to repayment
by the Company of approximately $4,750,000 of debt obligations in the third and
fourth quarters of 1996.
In the first quarter of 1996, the Company recorded a one-time debt
conversion expense of $801,597, relating to the conversion of an aggregate of
$2,565,105 of principal and interest on the Company's 6% Notes into shares of
Common Stock, which represents the difference between the stated conversion
price on the debt of $8.00 per share and the actual conversion price of $5.50.
In the six months ended June 30, 1997, the Company recorded foreign
currency losses of $716,000. These losses were the result of changes in the UK
and Australian exchange rates from December 31, 1996 to June 30, 1997 on the
Company's holdings of cash in British pounds sterling and Australian dollars.
The Company did not hold significant foreign currencies during the first six
months of 1996 and therefore, did not recognize a notable foreign currency gain
or loss during that period.
The Company's net loss for the six months ending June 30, 1997, was
$8.6 million compared to a net loss of $7.1 million for the six months ending
June 30, 1996. This increase was due to the activities described above.
LIQUIDITY AND CAPITAL RESOURCES
Since its inception, TAb has been in the development stage, devoting
its efforts and resources to drug discovery and development programs. Capital
resources have been used for the establishment and expansion of production
facilities, research and development, clinical testing and to meet TAb's
increased working capital needs in connection with such activities. Management
does not expect revenues from product sales to be a significant source of
funding until additional products receive regulatory approval. Future capital
requirements will depend on numerous factors, including the progress of its
research programs and clinical trials, the development of regulatory
submissions, the commercial viability of the Company's products, the development
of sales, distribution and marketing capabilities, and the terms of any new
licensing arrangements. Financing for the Company's operating and capital
requirements historically has been provided by the sale of equity, convertible
debt and through other financings.
At June 30, 1997, the Company had cash, cash equivalents and short term
investments totaling $14,546,000 (cash and cash equivalents of $5,698,000 and
short term investments of $8,848,000) of which approximately $7,258,000 was
denominated in British pounds and $1,597,000 in Australian dollars. The
Company's net cash used in operating activities during the quarter ending June
30, 1997 totaled $7,248,000, an increase of 30% from the six months ending June
30, 1996. Capital expenditures of $545,000 for the first six months of 1997
related primarily to expansion of production facilities in Wales and Australia.
TAb anticipates that total capital expenditures for 1997 will be approximately
$1.5 million.
9
<PAGE> 10
The Company's holdings of short-term investments increased 342% to
$8,848,000 as of June 30, 1997 from $2,002,000 as of December 31, 1996. This
increase is due to the additional purchases of higher-yielding debt instruments
with a greater than three month maturity.
Between January 1, 1997 and June 30, 1997, certain holders of warrants
for the Company's stock exercised warrants to purchase 824,631 shares of Common
Stock. The exercise prices of the warrants ranged from $.60 to $2.50 per share
and totaled $1,145,373 in the aggregate.
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
During February 1997, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 128, "Earnings Per Share" ("SFAS No.
128"). The Company will adopt SFAS No. 128 during the fourth quarter of 1997 as
required and does not expect it to have a material impact on the calculation of
net income per share.
During June 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 130, "Reporting Comprehensive Income" ("SFAS
No. 130") and Statement of Financial Accounting Standards No. 131 "Disclosures
about Segments of an Enterprise and Related Information" ("SFAS No. 131"). The
Company will adopt SFAS No. 130 and SFAS No. 131 in 1998 as required. Because
these standards require only disclosure of certain additional information, the
effect of adoption will not have a significant impact on the Company's financial
position.
OTHER FINANCIAL INFORMATION
Coopers & Lybrand, L.L.P., the Company's independent public accountants,
performed a limited review of the financial data presented on pages 2 through 6
inclusive. The review was performed in accordance with standards for such
reviews established by the American Institute of Certified Public Accountants.
The review did not constitute an audit; accordingly, Coopers & Lybrand, L.L.P.
did not express an opinion on the aforementioned data.
10
<PAGE> 11
PART II
OTHER INFORMATION
ITEM 2. CHANGES IN SECURITIES
Between January 1, 1997 and June 30, 1997, certain holders of warrants
for the Company's stock exercised warrants to purchase 824,631 shares of Common
Stock. The exercise prices of the warrants ranged from $.60 to $2.50 per share
and totaled $1,145,373 in the aggregate. These shares were issued pursuant to
exemptions from registration contained in Section 4(2) of the Securities Act of
1933, as amended.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Annual Meeting of shareholders of the Company was held on April 28,
1997. At the meeting, shareholders were asked to vote upon the election of the
Company's directors and the adoption of the Company's 1997 Stock Option Plan.
Proxies for the meeting were solicited in pursuant to Regulation 14 under the
Securities and Exchange Act of 1934, as amended. There was no solicitation in
opposition to management's recommendations as stated in the proxy statement. All
nominees to the board of directors were elected and each other matter to come to
before the meeting was approved in accordance with management's recommendations.
The following persons were elected to serve as directors of the Company
until the next annual meeting of shareholders or until their respective
successors are elected and qualified. The vote was as follows:
<TABLE>
<CAPTION>
Votes Cast Votes Cast Broker Non-Votes/
Name in Favor Against Abstentions
- ---- ---------- ---------- -----------------
<S> <C> <C> <C>
Martin S. Brown 11,419,510 7,750 10,944,432
Harry G. Browne, M.D. 11,419,510 7,750 10,944,432
A. J. Kazimi 11,384,466 42,794 10,944,432
John Landon, M.D. 11,421,010 6,250 10,944,432
Timothy Chard, M.D. 11,421,010 6,250 10,944,432
Thomas G. Andrews 11,293,975 133,285 10,944,432
Robin M. Baillie 11,421,010 6,250 10,944,432
Robert C. Hilton 11,385,966 41,294 10,944,432
John S. Robb 11,421,010 6,250 10,944,432
Steven L. Stroup, M.D. 11,421,010 6,250 10,944,432
Joseph D. Williams. 11,421,010 6,250 10,944,432
</TABLE>
The shareholders also voted in favor of adopting the Company's 1997
Stock Option Plan. The vote was 10,888,108 in favor, 539,152 against and
10,944,432 broker non-votes or abstentions.
11
<PAGE> 12
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Exhibit
Number Description of Exhibits
- -------- -----------------------
11.1 Statement re:computation of per share earnings
27 Financial Data Schedule (SEC use only)
(b) Reports on Form 8-K.
The Company did not file any Current Reports on Form 8-K during
the second quarter of 1997.
12
<PAGE> 13
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be filed on its behalf by the
undersigned thereunto duly authorized.
Date: August 14, 1997 /s/ Martin S. Brown
-------------------------------
Martin S. Brown
Chairman of the Board
Chief Executive Officer
(Principal Executive Officer)
Date: August 14, 1997 /s/ Robert D. Brown
-------------------------------
Robert D. Brown, CPA
Vice President & Controller
(Principal Accounting Officer)
13
<PAGE> 1
Exhibit 11.1
THERAPEUTIC ANTIBODIES INC.
STATEMENT RE: COMPUTATION OF PER SHARE EARNINGS
<TABLE>
<CAPTION>
For the Cumulative
Development Stage
For the Six Months Ended From August 10, 1984
June 30, (Inception)Through
1997 1996 June 30, 1997
------------- ------------- --------------------
<S> <C> <C> <C>
ACTUAL
Weighted average shares outstanding 22,569,850 17,001,819 9,424,029
============= ============= ============
Net loss $ (8,635,724) $ (7,064,721) $(51,200,389)
============= ============= ============
Net loss per share $ (0.38) $ (0.42) $ (5.43)
============= ============= ============
PRIMARY
Weighted average shares outstanding 22,569,850 17,001,819 9,424,029
Dilutive effect of stock options and warrants 694,794 2,188,800 694,794
------------- ------------- ------------
23,264,644 19,190,619 10,118,823
============= ============= ============
Net loss $ (8,635,724) $ (7,064,721) $(51,200,389)
============= ============= ============
Net loss per share $ (0.37) $ (0.37) $ (5.06)
============= ============= ============
FULLY DILUTED
Weighted average shares outstanding 22,569,850 17,001,819 9,424,029
Dilutive effect of stock options and warrants 694,794 2,555,367 694,794
------------- ------------- ------------
23,264,644 19,557,186 10,118,823
============= ============= ============
Net loss $ (8,635,724) $ (7,064,721) $(51,200,389)
============= ============= ============
Net loss per share $ (0.37) $ (0.36) $ (5.06)
============= ============= ============
</TABLE>
The dilutive effect of stock options and warrants is determined under the
treasury stock method utilizing fair value per share of $5.95 for both primary
and fully diluted earnings per share in the six months ended June 30, 1997 and
$6.38 and $8.14 for primary and fully diluted earnings per share in the six
months ended June 30, 1996.
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<CASH> 9,455,976
<SECURITIES> 5,090,309
<RECEIVABLES> 128,830
<ALLOWANCES> 0
<INVENTORY> 485,829
<CURRENT-ASSETS> 15,945,899
<PP&E> 16,159,636
<DEPRECIATION> 4,209,519
<TOTAL-ASSETS> 28,724,232
<CURRENT-LIABILITIES> 2,476,778
<BONDS> 8,042,461
0
0
<COMMON> 23,178
<OTHER-SE> 17,432,694
<TOTAL-LIABILITY-AND-EQUITY> 28,724,232
<SALES> 219,195
<TOTAL-REVENUES> 822,798
<CGS> 73,453
<TOTAL-COSTS> 320,388
<OTHER-EXPENSES> 9,138,134
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 535,359
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 8,635,724
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 8,635,724
<EPS-PRIMARY> .37
<EPS-DILUTED> .37
</TABLE>
