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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 16, 2001
REGISTRATION NO. 333-_______
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
GENETRONICS BIOMEDICAL LTD.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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BRITISH COLUMBIA, CANADA 33-0024450
(State or Other Jurisdiction (IRS Employer Identification Number for Genetronics, Inc.)
of Incorporation or Organization)
11199 SORRENTO VALLEY ROAD
SAN DIEGO, CA 92121-1334
(858) 597-6006
(Address, Including Zip Code, and Telephone Number, Including
Area Code, of Registrant's Principal Executive Offices)
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MARTIN NASH
PRESIDENT, CHIEF EXECUTIVE OFFICER
11199 SORRENTO VALLEY ROAD
SAN DIEGO, CA 92121-1334
(858) 597-6006
(Name, Address, Including Zip Code, and Telephone Number, Including
Area Code, of Agent for Service)
---------------
COPIES TO:
DOUGLAS J. REIN, ESQ.
GRAY CARY WARE & FREIDENRICH LLP
4365 EXECUTIVE DRIVE, SUITE 1600
SAN DIEGO, CA 92121
TELEPHONE: (858) 677-1400
FACSIMILE: (858) 677-1477
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after the Effective Date of this Registration Statement.
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If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please 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. [ ]
CALCULATION OF REGISTRATION FEE
==========================================================================================================
PROPOSED PROPOSED
AMOUNT MAXIMUM MAXIMUM AMOUNT OF
TITLE OF SHARES TO BE AGGREGATE PRICE AGGREGATE REGISTRATION
TO BE REGISTERED REGISTERED PER SHARE(1) OFFERING PRICE FEE
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Common Stock, (no par value) 1,000,000 shares $1.27 $1,270,000 $318
==========================================================================================================
(1) Estimated, pursuant to Rule 457(c), solely for the purpose of
calculating the registration fee based on the average of the high and
low prices for the common stock, as reported on the American Stock
Exchange on February 13, 2001.
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 SAID SECTION 8(a),
MAY DETERMINE.
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PROSPECTUS
GENETRONICS BIOMEDICAL LTD.
1,000,000 SHARES OF COMMON STOCK
The selling stockholders of Genetronics Biomedical Ltd. listed on Page
19 of this prospectus may offer and resell up to 1,000,000 shares of Genetronics
Biomedical Ltd. common stock under this prospectus. All of the shares offered
hereunder are to be sold by the selling stockholders.
The information in the prospectus is not complete and may be changed.
The selling stockholders may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is effective. This
prospectus is not an offer to sell these securities and it is not soliciting an
offer to buy these securities in any state where the offer or sale is not
permitted.
Our common stock is traded on the American Stock Exchange and the
Toronto Stock Exchange under the symbol "GEB." The address of our principal
executive offices is: 11199 Sorrento Valley Road, San Diego, California
92121-1334. Our telephone number is (858) 597-6006. On February 13, 2001, the
last sale price of our common stock as reported on the American Stock Exchange
was $1.27.
THIS INVESTMENT INVOLVES A HIGH DEGREE OF RISK. NEITHER THE SECURITIES AND EXCHANGE COMMISSION
YOU SHOULD PURCHASE SHARES ONLY IF YOU CAN NOR ANY STATE SECURITIES COMMISSION HAS
AFFORD A COMPLETE LOSS OF YOUR INVESTMENT. APPROVED OR DISAPPROVED OF THESE SECURITIES OR
PASSED UPON THE ADEQUACY OR ACCURACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
See "Risk Factors" beginning on Page 6 for a discussion of certain
factors that should be considered by prospective purchasers of shares of our
common stock.
You should not assume that the information in this prospectus is
accurate as of any date other than the date below.
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The date of this prospectus is February 16, 2001.
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TABLE OF CONTENTS
PAGE
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Summary Information 5
Risk Factors 6
Where You Can Find More Information 18
Incorporation of Certain Documents by Reference 18
Selling Stockholders 19
Plan of Distribution 20
Use of Proceeds 21
Legal Matters 21
Experts 21
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You should rely only on the information contained or incorporated by
reference in this prospectus. No one has been authorized to provide you with
different information.
The common stock is not being offered in any jurisdiction where the
offer is not permitted.
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SUMMARY INFORMATION
You should read this summary together with the more detailed information
and/or financial statements and notes appearing elsewhere in this prospectus and
in the documents incorporated into this prospectus by reference. You should
carefully consider, among other things, the matters set forth in "Risk Factors."
ALL DOLLAR AMOUNTS SET FORTH IN THE PROSPECTUS ARE STATED IN UNITED STATES
DOLLARS, EXCEPT WHERE OTHERWISE INDICATED.
We are a drug and gene delivery company specializing in developing
technology and hardware focused on electroporation. Electroporation is the
application of brief, controlled pulsed electric fields to cells, which cause
tiny pores to temporarily open in the cell membrane. Immediately after
electroporation, the cell membrane is more permeable to drugs and other agents.
The use of electroporation along with these other agents is called
electroporation therapy.
We operate through two divisions: (i) the Drug and Gene Delivery
Division, through which we are developing drug and gene delivery systems based
on electroporation to be used in the treatment of disease and, (ii) the BTX
Instrument Division, which develops, manufactures, and sells electroporation
equipment to the research laboratory market.
The Drug and Gene Delivery Division focuses on the development of
human-use equipment that is designed to allow physicians to use electroporation
therapy to achieve more efficient and cost-effective delivery of drugs or genes
to patients with a variety of illnesses, including cancer. Our proprietary
electroporation drug and gene delivery system, the MedPulser(R) system, has been
used with bleomycin, a chemotherapeutic agent, in clinical trials conducted in
the United States, Australia, Europe and Canada for treatment of head and neck
cancer, as well as melanoma, liver, pancreatic, basal cell and Koposi sarcoma
cancers.
The BTX Instrument Division is a leader in the development and marketing
of electroporation instruments and supplies, with more than 2000 customers in
universities, companies, and research institutions worldwide. The BTX Instrument
Division produces an extensive line of electroporation instruments and
accessories, including electroporation and cell fusion instruments, a monitoring
device, and an assortment of electrodes and accessories. Electroporation in
research is commonly used for the transformation and transfection of all cell
types, as well as for general molecular delivery at the cellular level.
Transformation is a process by which the genetic material carried by an
individual cell is altered by the incorporation of exogenous DNA into its
genome. Transfection is the uptake, incorporation, and expression of exogenous
DNA by eukaryotic cells.
We currently sell instrumentation and accessories in all states and
territories of the United States and in over 47 foreign countries. The main
distributors of our products in North America are VWR Scientific Products
Corporation and Fisher Scientific Company, two of the largest laboratory product
suppliers in the United States. In addition, the BTX Instrument Division
distributes instruments and supplies through Intermountain Scientific
Corporation, which has 23 field sales specialists in the United States. The BTX
Instrument Division has over 45 international distributors in 36 countries, of
which Merck Eurolab Holding Gmbh is the main distributor in Europe.
All our business activities are conducted through Genetronics, Inc., a
California corporation. Our common shares trade on the Toronto Stock Exchange
and on the American Stock Exchange under the symbol "GEB." A more complete
description of our business and its recent activities can be found in the
documents described in "WHERE YOU CAN FIND MORE INFORMATION" on Page 18.
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RISK FACTORS
In addition to the other information in this prospectus or incorporated
in this prospectus by reference, you should consider carefully the following
factors in evaluating our business before purchasing the common stock offered by
this prospectus. If any of the following risks actually occur, our business or
results of operations could be seriously harmed. In that case, the trading price
of our common shares could decline, and you may lose part or all of your
investment. The risks described below are not the only ones we face. Additional
risks not presently known to us or that we currently deem immaterial may also
impair our business operations.
This prospectus, including the information incorporated by reference,
contains forward-looking statements made under the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. Actual results could differ
materially from those projected in the forward-looking statements as a result of
the risk factors set forth beginning on this page and others detailed from time
to time in our periodic reports filed with the SEC.
OUR BUSINESS MODEL MAY CHANGE AS OUR PRIORITIES AND OPPORTUNITIES CHANGE; AND
OUR BUSINESS MAY NEVER DEVELOP TO BE PROFITABLE OR SUSTAINABLE.
There are many programs that to us seem promising and that we could
pursue. However, with limited resources, we may decide to change priorities and
shift programs away from those that we had been pursuing, for the purpose of
exploiting our core technology of electroporation. The choices we may make will
be dependent upon numerous factors, which we cannot predict. We cannot assure
you that our business model, as it currently exists or as it may evolve, will
enable us to become profitable or to sustain operations.
IF WE DO NOT SUCCESSFULLY COMMERCIALIZE PRODUCTS FROM OUR DRUG AND GENE DELIVERY
DIVISION, THEN OUR BUSINESS WILL SUFFER.
Our Drug and Gene Delivery Division is in the early development stage
and our success depends on the success of the technology being developed by the
Drug and Gene Delivery Division. Although we have received various regulatory
approvals which apply to Europe for our equipment for use in treating solid
tumors, the products related to such regulatory approval have not yet been
commercialized. In addition, we have not yet received any regulatory approvals
to sell our clinical products in the United States and further clinical trials
are still necessary before we can seek regulatory approval to sell our product
in the United States for treating solid tumors. We cannot assure you that we
will successfully develop any products. If we fail to develop or successfully
commercialize any products, then our business will suffer.
UNPREDICTABILITY OF CONDUCTING PRE-CLINICAL AND CLINICAL TRIALS OF OUR HUMAN-USE
EQUIPMENT.
Before any of our human-use equipment can be sold, the Food and Drug
Administration (FDA), or applicable foreign regulatory authorities, must
determine that the equipment meets specified criteria for use in the indications
for which approval is requested. The FDA will make this determination based on
the results from our pre-clinical testing and clinical trials.
Clinical trials are unpredictable. Results achieved in early stage
clinical trials may not be repeated in later stage trials, or in trials with
more patients. When early, positive results are not repeated in later stage
trials, pharmaceutical and biotechnology companies have suffered significant
setbacks. Not only are commercialization timelines pushed back, but some
companies, particularly smaller biotechnology
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companies with limited cash reserves, have gone out of business after releasing
news of unsuccessful clinical trial results.
If any of the following events arise during our clinical trials or data
review, then we would expect this to have a serious negative effect on our
company and your investment:
- The electroporation-mediated delivery of drugs or other agents may be
found to be ineffective or to cause harmful side effects, including
death;
- Our clinical trials may take longer than anticipated, for any of a
number of reasons including a scarcity of subjects that meet the
physiological or pathological criteria for entry into the study, a
scarcity of subjects that are willing to participate through the end
of the trial, or data and document review;
- The reported clinical data may change over time as a result of the
continuing evaluation of patients or the current assembly and review
of existing clinical and pre-clinical information;
- Data from various sites participating in the clinical trials may be
incomplete or unreliable, which could result in the need to repeat
the trial or abandon the project; and
- The FDA and other regulatory authorities may interpret our data
differently than we do, which may delay or deny approval.
Clinical trials are generally quite expensive. A delay in our trials,
for whatever reason, will probably require us to spend additional funds to keep
the product(s) moving through the regulatory process. If we do not have or
cannot raise the needed funds, then the testing of our human-use products could
be shelved. In the event the clinical trials are not successful, we will have to
determine whether to put more money into the program to address its deficiencies
or whether to abandon the clinical development programs for the products in the
tested indications. Loss of the human-use product line would be a significant
setback for our company.
Because there are so many variables inherent in clinical trials, we
cannot predict whether any of our future regulatory applications to conduct
clinical trials will be approved by the FDA or other regulatory authorities,
whether our clinical trials will commence or proceed as planned, and whether the
trials will ultimately be deemed to be successful.
OUR BUSINESS IS HIGHLY DEPENDENT ON RECEIVING APPROVALS FROM VARIOUS UNITED
STATES AND INTERNATIONAL GOVERNMENT AGENCIES AND CAN BE DRAMATICALLY AFFECTED IF
APPROVAL TO MANUFACTURE AND SELL OUR HUMAN-USE EQUIPMENT IS NOT GRANTED.
The production and marketing of our human-use equipment and the ongoing
research, development, preclinical testing, and clinical trial activities are
subject to extensive regulation. Numerous governmental agencies in the US and
internationally, including the FDA, must review our applications and decide
whether to grant approval. All of our human-use equipment must go through an
approval process, in some instances for each indication in which we want to
label it for use (such as, use for dermatology, use for transfer of a certain
gene to a certain tissue, or use for administering a certain drug to a certain
tumor type in a patient having certain characteristics). These regulatory
processes are extensive and involve substantial costs and time.
We have limited experience in, and limited resources available for
regulatory activities. Failure to comply with applicable regulations can, among
other things, result in non-approval, suspensions of
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regulatory approvals, fines, product seizures and recalls, operating
restrictions, injunctions and criminal prosecution.
Any of the following events can occur and, if any did occur, any one
could have a material adverse effect on us:
- There can be delays, sometimes long, in obtaining approval for our
human-use devices;
- The rules and regulations governing human-use equipment such as ours
can change during the review process, which can result in the need to
spend time and money for further testing or review;
- If approval for commercialization is granted, it is possible the
authorized use will be more limited than we believe is necessary for
commercial success, or that approval may be conditioned on completion
of further clinical trials or other activities; and
- Once granted, approval can be withdrawn, or limited, if previously
unknown problems arise with our human-use product or data arising
from its use.
WE RELY HEAVILY ON COLLABORATIVE AND LICENSING RELATIONSHIPS, AND WILL BE
NEGATIVELY AFFECTED IF WE CANNOT MAINTAIN OR EXPAND EXISTING RELATIONSHIPS, AND
INITIATE NEW ONES.
We rely and will continue to rely on partners and collaborators to fund
some of our research and development expenses and to assist us in the research
and development of our human-use equipment. Our largest partner had been Ethicon
Endo-Surgery, Inc., a Johnson & Johnson company. On July 26, 2000, we received
written notice from Ethicon Endo-Surgery, Inc. that it had elected to exercise
its discretionary right to terminate, without cause, our License and Development
Agreement and our Supply Agreement. If we are unable to enter into a
relationship with a new partner for the Electroporation Drug Delivery System,
our business could be adversely impacted. Moreover, loss of or any significant
change in any of our material collaborative relationships could adversely impact
our business.
Our clinical trials to date have used our equipment with the anti-cancer
drug bleomycin. We do not currently intend to package bleomycin together with
the equipment for sale, but if it should be necessary or desirable to do this,
we would need a reliable source of the drug. In 1998, we signed a supply
agreement with Abbott Laboratories under which Abbott would sell us bleomycin
for inclusion in our package. If it becomes necessary or desirable to include
bleomycin in our package, and this relationship with Abbott should be
terminated, then we would have to form a relationship with another provider of
this generic drug before any product could be launched.
We also rely on scientific collaborators at universities and companies
to further our research and test our equipment. In most cases, we lend our
equipment to a collaborator, teach him or her how to use it, and together design
experiments to test the equipment in one of the collaborator's fields of
expertise. We aim to secure agreements that restrict collaborators' rights to
use the equipment outside of the agreed upon research, and outline the rights
each of us will have in any results or inventions arising from the work.
Nevertheless, there is always risk that:
- Our equipment will be used in ways we did not authorize, which can
lead to liability and unwanted competition;
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- We may determine that our technology has been improperly assigned to
us or a collaborator may claim rights to certain of our technology,
which may require us to pay license fees or milestone payments and,
if commercial sales of the underlying product is achieved, royalties;
- We may lose rights to inventions made by our collaborators in the
field of our business, which can lead to expensive legal fights and
unwanted competition;
- Our collaborators may not keep our confidential information to
themselves, which can lead to loss of our right to seek patent
protection and loss of trade secrets, and expensive legal fights; and
- Collaborative associations can damage a company's reputation if they
go awry and, thus, by association or otherwise, the scientific or
medical community may develop a negative view of us.
We cannot guarantee that any of the results from these collaborations
will be fruitful. We also cannot tell you that we will be able to continue to
collaborate with individuals and institutions that will further our work, or
that we will be able to do so under terms that are not too restrictive. If we
are not able to maintain or develop new collaborative relationships, then it is
likely the research pace will slow down and it will take longer to identify and
commercialize new products, or new indications for our existing products.
WE COULD BE SUBSTANTIALLY DAMAGED IF PHYSICIANS AND HOSPITALS PERFORMING OUR
CLINICAL TRIALS DO NOT ADHERE TO PROTOCOLS OR PROMISES MADE IN CLINICAL TRIAL
AGREEMENTS.
Our company also works and has worked with a number of hospitals to
perform clinical trials, primarily in oncology. We depend on these hospitals to
recruit patients for the trials, to perform the trials according to our
protocols, and to report the results in a thorough, accurate and consistent
fashion. Although we have agreements with these hospitals, which govern what
each party is to do with respect to the protocol, patient safety, and avoidance
of conflict of interest, there are risks that the terms of the contracts will
not be followed.
For instance:
- Risk of Deviations from Protocol. The hospitals or the physicians
working at the hospitals may not perform the trial correctly.
Deviations from protocol may make the clinical data not useful and
the trial could be essentially worthless.
- Risk of Improper Conflict of Interest. Physicians working on
protocols may have an improper economic interest in our company, or
other conflict of interest. When a physician has a personal stake in
the success of the trial, such as can be inferred if the physician
owns stock, or rights to purchase stock, of the trial sponsor, it can
create suspicion that the trial results were improperly influenced by
the physician's interest in economic gain. Not only can this put the
clinical trial results at risk, but it can also do serious damage to
a company's reputation.
- Risks Involving Patient Safety and Consent. Physicians and hospitals
may fail to secure formal written consent as instructed or report
adverse effects that arise during the trial in the proper manner,
which could put patients at unnecessary risk. This increases our
liability, affects the data, and can damage our reputation.
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If any of these events were to occur, then it could have a material
adverse effect on our ability to receive regulatory authorization to sell our
human-use equipment, not to mention on our reputation. Negative events that
arise in the performance of clinical trials sponsored by biotechnology companies
of our size and with limited cash reserves similar to ours have resulted in
companies going out of business.
WE RELY HEAVILY ON OUR PATENTS AND PROPRIETARY RIGHTS TO ATTRACT PARTNERSHIPS
AND MAINTAIN MARKET POSITION.
Another factor that will influence our success is the strength of our
patent portfolio. Patents give the patent holder the right to keep others out of
its patented territory. If someone practices within the patented territory of a
patent holder, then the patent holder has the right to charge that person with
infringement and begin legal proceedings, which can be lengthy and costly. We
are in the process of performing an ongoing review of our patent portfolio to
confirm that our key technologies are adequately protected. If necessary, we may
ask that one or more of our patents be reexamined or reissued by the United
States patent office.
The patenting process, enforcement of issued patents, and defense
against claims of infringement are inherently risky. Because our Drug and Gene
Delivery Division relies heavily on patent protection, for us, the risks are
significant and include the following:
- Risk of Inadequate Patent Protection for Product. The United States
or foreign patent offices may not grant patents of meaningful scope
based on the applications we have already filed and those we intend
to file. If we do not have patents that adequately protect our
human-use equipment and indications for its use, then we will not be
competitive.
- Risk Important Patents Will Be Judged Invalid. Some of the issued
patents we now own or license may be determined to be invalid. If we
have to defend the validity of any of our patents, then it will
require a lot of time and money to do so, and there is no guarantee
of a successful outcome. In the event an important patent related to
our drug delivery technology is found to be invalid, we may lose
competitive position and may not be able to receive royalties for
products covered in part or whole by that patent under license
agreements.
- Risk of Being Charged With Infringement. Although we try to avoid
infringement, there is the risk that we will use a patented
technology owned by another person and/or be charged with
infringement. Defending against a charge of infringement can involve
lengthy and costly legal actions, with no guarantee of a successful
outcome. Biotechnology companies of roughly our size and financial
position have gone out of business after fighting and losing an
infringement battle. If we were prevented from using or selling our
human-use equipment, then our business would be seriously affected.
- Freedom to Operate Risks. We are aware that patents related to
electrically assisted drug delivery have been granted to, and patent
applications filed by, our potential competitors. We or our partners
have taken licenses to some of these patents, and will consider
taking additional licenses in the future. Nevertheless, the
competitive nature of our field of business and the fact that others
have sought patent protection for technologies similar to ours, makes
these significant risks.
In addition to patents, we also rely on trade secrets and proprietary
know-how. We try to protect this information with appropriate confidentiality
and inventions agreements with our employees, scientific advisors, consultants,
and collaborators. We cannot assure you that these agreements will not be
breached, that we will be able to do much to protect ourselves if they are
breached, or that our trade secrets will not
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otherwise become known or be independently discovered by competitors. If any of
these events occurs, then we run the risk of losing control over valuable
company information, which could negatively affect our competitive position.
WE RUN THE RISK THAT OUR TECHNOLOGY WILL BECOME OBSOLETE OR LOSE ITS COMPETITIVE
ADVANTAGE.
The drug delivery business is very competitive, fast moving and intense,
and expected to be increasingly so in the future. Other companies and research
institutions are developing drug delivery systems that, if not similar in type
to our systems, are designed to address the same patient or subject population.
Therefore, we cannot promise you that our products will be the best, the safest,
the first to market, or the most economical to make or use. If competitors'
products are better than ours, for whatever reason, then we will make less money
from sales and our products risk becoming obsolete.
There are many reasons why a competitor might be more successful than
us, including:
- More Money. Some competitors have a lot more money than we do. They
can afford more technical and development setbacks than we can.
- Greater Experience. Some competitors have been in the drug delivery
business longer than we have. They have greater experience than us in
critical areas like clinical testing, obtaining regulatory approval,
and sales and marketing. This experience or their name recognition
may give them a competitive advantage over us.
- Superior Patent Position. Some competitors may have a better patent
position protecting their technology than we have or will have to
protect our technology. If we cannot use our patents to prevent
others from copying our technology or developing similar technology,
or if we cannot obtain a critical license to another's patent that we
need to make and use our equipment, then we would expect our
competitive position to lessen.
- Faster to Market. Some companies with competitive technologies may
move through stages of development, approval, and marketing faster
than us. If a competitor receives FDA approval before us, then it
will be authorized to sell its products before we can sell ours.
Because the first company "to market" often has a significant
advantage over late-comers, a second place position could result in
less than anticipated sales.
- Reimbursement Allowed. In the United States, third party payers, such
as Medicare, may reimburse physicians and hospitals for competitors'
products but not for our human-use products. This would significantly
affect our ability to sell our human-use products in the United
States and would have a serious effect on revenues and our business
as a whole. Outside of the United States, reimbursement and funding
policies vary widely.
OUR ABILITY TO ACHIEVE SIGNIFICANT REVENUE FROM SALES OR LEASES OF HUMAN-USE
EQUIPMENT WILL DEPEND ON ESTABLISHING EFFECTIVE SALES, MARKETING AND
DISTRIBUTION CAPABILITIES OR RELATIONSHIPS AND WE LACK SUBSTANTIAL EXPERIENCE IN
THESE AREAS.
Our company has no experience in sales, marketing and distribution of
clinical and human-use products. If we want to be direct distributors of the
human-use products, then we must develop a marketing and sales force. This would
involve a lot of money, training, and time. Alternatively, we may decide to rely
on a company with a large distribution system and a large direct sales force to
undertake the majority of these activities on our behalf. This route could
result in less profit for us, but may permit us to reach market faster. In any
event, we may not be able to undertake this effort on our own, or contract with
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another to do this at a reasonable cost. Regardless of the route we take, we may
not be able to successfully commercialize any product.
WE HAVE OPERATED AT A LOSS AND WE EXPECT TO CONTINUE TO ACCUMULATE A DEFICIT.
As of December 31, 2000, we had a deficit of $35,568,862. We have
operated at a loss since 1994, and we expect this to continue for some time. The
amount of the accumulated deficit will continue to grow, as it will be expensive
to continue our clinical, research, and development efforts. If these activities
are successful, and if we receive approval from the FDA to market human-use
equipment, then even more money will be required to market and sell the
equipment.
Most of the cash we received during the fiscal year ended March 31, 2000
was from the sale and distribution of special warrants to investors and funding
received from contracting partners. Other funds came from sales of BTX
research-use equipment, interest income on our investments, Small Business
Innovative Research (SBIR) grants, milestone payments, sales of equipment to
Ethicon for use in clinical trials, and exercise of stock options. It is
possible that we will lose our SBIR grants or that it will be determined that we
are not or have not been in compliance with such program requirements, and the
government may require us to pay back the original funding grants or even pay
certain penalties if it determines that we have used the grant funds
inappropriately. We do not expect to receive enough money from these sources to
completely pay for future activities.
WE WILL HAVE A NEED FOR SIGNIFICANT AMOUNTS OF MONEY IN THE FUTURE AND THERE IS
NO GUARANTEE THAT WE WILL BE ABLE TO OBTAIN THE AMOUNTS WE NEED.
As discussed, we have operated at a loss, and expect that to continue
for some time in the future. Our plans for continuing clinical trials,
conducting research, furthering development and, eventually, marketing our
human-use equipment will cost a lot of money. The extent of these costs will
depend on many factors, including some of the following:
- The progress and breadth of preclinical testing and the size of our
drug delivery programs, all of which directly influence cost;
- The costs involved in complying with the regulatory process to get
our human-use products approved, including the number, size, and
timing of necessary clinical trials and costs associated with the
current assembly and review of existing clinical and pre-clinical
information;
- The costs involved in patenting our technologies and defending them;
- Changes in our existing research and development relationships and
our ability to enter into new agreements;
- The cost of manufacturing our human-use and research-use equipment;
and
- Competition for our products and our ability, and that of our
partners, to commercialize our products.
We plan to fund operations by several means. We will attempt to enter
into contracts with partners that will fund either general operating expenses or
specific programs or projects. Some funding also may be received through
government grants. We cannot promise that we will enter into any such
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contracts or receive such grants, or, if we do, that our partners and the grants
will provide enough money to meet our needs.
In the past, we have raised funds by public and private sale of our
stock, and we may do this in the future to raise needed funds. Sale of our stock
to new private or public investors usually results in existing stockholders
becoming "diluted". The greater the number of shares sold, the greater the
dilution. A high degree of dilution can make it difficult for the price of our
stock to rise rapidly, among other things. Dilution also lessens a stockholder's
voting power.
We cannot assure you that we will be able to raise money needed to fund
operations, or that we will be able to raise money under terms that are
favorable to us.
IF WE DO NOT HAVE ENOUGH MONEY TO FUND OPERATIONS, THEN WE WILL HAVE TO CUT
COSTS.
If we are not able to raise needed money under acceptable terms, then we
will have to take measures to cut costs, such as:
- Delay, scale back or discontinue one or more of our drug or gene
delivery programs or other aspects of operations, including laying
off some personnel or stopping or delaying clinical trials;
- Sell or license some of our technologies that we would not otherwise
give up if we were in a better financial position;
- Sell or license some of our technologies under terms that are a lot
less favorable than they otherwise might have been if we were in a
better financial position; and
- Consider merging with another company or positioning ourselves to be
acquired by another company.
If it became necessary to take one or more of the above-listed actions,
then we may have a lower valuation, which probably would be reflected in our
stock price.
THE MARKET FOR OUR STOCK IS VOLATILE, WHICH COULD ADVERSELY AFFECT AN INVESTMENT
IN OUR STOCK.
Our share price and volume are highly volatile. This is not unusual for
biomedical companies of our size, age, and with a discrete market niche. It also
is common for the trading volume and price of biotechnology stocks to be
unrelated to a company's operations, i.e., to go up or down on positive news and
to go up or down on no news. Our stock has exhibited this type of behavior in
the past, and may well exhibit it in the future. The historically low trading
volume of our stock, in relation to many other biomedical companies of about our
size, makes it more likely that a severe fluctuation in volume, either up or
down, will affect the stock price.
Some factors that we would expect to depress the price of our stock
include:
- Adverse clinical trial results;
- Announcement that the FDA denied our request to approve our human-use
product for commercialization in the United States, or similar denial
by other regulatory bodies which make independent decisions outside
the United States. To date, Europe is the only foreign jurisdiction
in which we have sought approval for commercialization;
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- Announcement of legal actions brought by or filed against us for
patent or other matters, especially if we do not win such actions;
- Cancellation of important corporate partnerships or agreements;
- Public concern as to the safety or efficacy of our human-use products
including public perceptions regarding gene therapy in general;
- Stockholders' decisions, for whatever reasons, to sell large amounts
of our stock;
- A decreasing cash-on-hand balance to fund operations, or other signs
of apparent financial uncertainty; and
- Significant advances made by competitors that are perceived to limit
our market position.
OUR DEPENDENCE UPON NON-MARKETED PRODUCTS, LACK OF EXPERIENCE IN MANUFACTURING
AND MARKETING HUMAN-USE PRODUCTS, AND OUR CONTINUING DEFICIT MAY RESULT IN EVEN
FURTHER FLUCTUATIONS IN OUR TRADING VOLUME AND SHARE PRICE.
Successful approval, marketing, and sales of our human-use equipment are
critical to the financial future of our company. Our products are not yet
approved for sale in the United States and some other jurisdictions and we may
never obtain those approvals. Even if we do obtain approvals to sell our
products, those sales may not be as large or timely as we expect. These
uncertainties may cause our operating results to fluctuate dramatically in the
next several years. We believe that quarter-to-quarter or annual comparisons of
our operating results are not a good indication of our future performance.
Nevertheless, these fluctuations may cause us to perform below the expectations
of the public market analysts and investors. If this happens, the price of our
common shares would likely fall.
OUR BTX INSTRUMENT DIVISION MARKETS ONLY TO THE ELECTROPORATION PRODUCT NICHE
MARKETS AND RELIES ON DISTRIBUTION RELATIONSHIPS FOR SALES.
The BTX Instrument Division currently markets only electroporation
equipment to the research market. If our research-use equipment loses its
competitive position, because the BTX Instrument Division does not have any
other product line on which to rely, our sales would likely decline. Therefore,
if we do not develop and introduce new products directed to research-use
electroporation, at a reasonable price, then we will lose pace with our
competitors. We may not have the necessary funds for our BTX Instrument Division
to stay competitive and that division may not ultimately succeed.
The research-use equipment is sold through United States and
international distributors. Approximately 30% of BTX instrument sales during the
fiscal year ended March 31, 2000 were in the United States through our
distribution relationship with VWR Scientific. This accounted for about 20% of
our total revenue. We rely heavily on our relationship with VWR to sell our
product in the United States. We may not be able to maintain or replace our
current distribution relationship with VWR or other distributors, or establish
sales, marketing and distribution capabilities of our own. If we cannot develop
or maintain distribution relationships for major markets such as the United
States, Europe and Japan, then the BTX Instrument Division may suffer declining
sales, which would have an effect on our financial performance.
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THERE IS A RISK OF PRODUCT LIABILITY WITH HUMAN-USE EQUIPMENT AND RESEARCH-USE
EQUIPMENT.
The testing, marketing and sale of human-use products expose us to
significant and unpredictable risks of equipment product liability claims. These
claims may arise from patients, clinical trial volunteers, consumers,
physicians, hospitals, companies, institutions, researchers or others using,
selling, or buying our equipment. Product liability risks are inherent in our
business and will exist even after the products are approved for sale. If and
when our human-use equipment is commercialized, and with respect to the
research-use equipment that is currently marketed by our BTX Instrument
Division, we run the risk that use (or misuse) of the equipment will result in
personal injury. The chance of such an occurrence will increase after a product
type is on the market.
We purchased liability insurance in connection with the ongoing oncology
clinical trials, and we would expect to purchase additional policies for any
additional clinical trial. The insurance we purchase may not provide adequate
coverage in the event a claim is made, and we may be required to pay claims
directly. If we did have to make payment against a claim, then it would impact
our financial ability to perform the research, development, and sales activities
we have planned.
With respect to our research-use equipment, there is always the risk of
product defects. Product defects can lead to loss of future sales, decrease in
market acceptance, damage to our brand or reputation, and product returns and
warranty costs. These events can occur whether the defect resides in a component
we purchased from a third party or whether it was due to our design and/or
manufacture. Our sales agreements typically contain provisions designed to limit
our exposure to product liability claims. However, we do not know whether these
limitations are enforceable in the countries in which the sale is made. Any
product liability or other claim brought against us, if successful and of
sufficient magnitude, could negatively impact our financial performance, even if
we have insurance.
WE CANNOT BE CERTAIN THAT WE WILL BE ABLE TO MANUFACTURE OUR HUMAN-USE AND
RESEARCH-USE EQUIPMENT IN SUFFICIENT VOLUMES AT COMMERCIALLY REASONABLE RATES.
Our products must be manufactured in sufficient commercial quantities,
in compliance with regulatory requirements, and at an acceptable cost to be
attractive to purchasers. We rely on third parties to manufacture and assemble
most aspects of our equipment.
Disruption of the manufacture of our products, for whatever reason,
could delay or interrupt our ability to manufacture or deliver our products to
customers on a timely basis. This would be expected to affect revenues and may
affect our long-term reputation, as well. In the event we provide product of
inferior quality, we run the risk of product liability claims and warranty
obligations, which will negatively affect our financial performance.
Our manufacturing facilities for human-use products will be subject to
quality systems regulations, international quality standards and other
regulatory requirements, including pre-approval inspection for the human-use
equipment and periodic post-approval inspections for all human-use products.
While we have undergone and passed a quality systems review from an
international body, we have never undergone a quality systems inspection by the
FDA. We may not be able to pass an FDA inspection when it occurs. If our
facilities are not up to the FDA standards in sufficient time, prior to United
States launch of product, then it will result in a delay or termination of our
ability to produce the human-use equipment in our facility. Any delay in
production will have a negative effect on our business.
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OUR BTX INSTRUMENT DIVISION MUST MANAGE THE RISKS OF INTERNATIONAL OPERATIONS.
Our BTX Instrument Division sells a significant amount of its
research-use equipment in foreign countries, particularly in the Pacific Rim. In
the fiscal year ended March 31, 2000, 36% of BTX's revenues were from BTX sales
into foreign countries. Like any company having foreign sales, BTX's sales are
influenced by many factors outside of our control.
For instance, the following factors can negatively influence BTX's sales
or profitability in foreign markets:
- We are subject to foreign regulatory requirements, foreign tariffs
and other trade barriers that may change without sufficient notice;
- Our expenses related to international sales and marketing, including
money spent to control and manage distributors, may increase to a
significant extent due to political and/or economic factors out of
our control;
- We are subject to various export restrictions and may not be able to
obtain export licenses when needed;
- Some of the foreign countries in which we do business suffer from
political and economic instability;
- Some of the foreign currencies in which we do business fluctuate
significantly;
- We may have difficulty collecting accounts receivables or enforcing
other legal rights; and
- We are subject to the Foreign Corrupt Practices Act, which may place
us at a competitive disadvantage to foreign companies that do not
have to adhere to this statute.
WE DEPEND ON THE CONTINUED EMPLOYMENT OF QUALIFIED PERSONNEL.
Our success is highly dependent on the people who work for us. If we
cannot attract and retain top talent to work in our company, then our business
will suffer. Our staff may not decide to stay with our company, and we may not
be able to replace departing employees or build departments with qualified
individuals.
We have an employment agreement in place for Martin Nash, our President
and Chief Executive Officer. If Mr. Nash leaves us, that might pose significant
risks to our continued development and progress. Our progress may also be
curtailed if Dietmar Rabussay, Ph.D., our Vice President of Research and
Development, or George M. Gill, M.D., our Vice President of Clinical Research
and Regulatory Affairs, were to leave us.
WE MAY NOT MEET ENVIRONMENTAL GUIDELINES, AND AS A RESULT COULD BE SUBJECT TO
CIVIL AND CRIMINAL PENALTIES.
Like all companies in our line of work, we are subject to a variety of
governmental regulations relating to the use, storage, discharge and disposal of
hazardous substances. Our safety procedures for handling, storage and disposal
of such materials are designed to comply with applicable laws and regulations.
Nevertheless, if we are found to not comply with environmental regulations, or
if we are involved with contamination or injury from these materials, then we
may be subject to civil and criminal
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penalties. This would have a negative impact on our reputation, our finances,
and could result in a slowdown, or even complete cessation of our business.
MOST OF OUR DIRECTORS ARE CANADIAN CITIZENS AND SERVICE AND ENFORCEMENT OF LEGAL
PROCESS UPON THEM MAY BE DIFFICULT.
Most of our directors are residents of Canada and most, if not all, of
these persons' assets are located outside of the United States. It may be
difficult for a stockholder in the United States to effect service or realize
anything from a judgment against these Canadian residents as a result of any
possible civil liability resulting from the violation of United States federal
securities laws.
OUR ACTUAL RESULTS COULD DIFFER MATERIALLY FROM THOSE ANTICIPATED IN OUR
FORWARD-LOOKING STATEMENTS.
Any statements in this prospectus about our expectations, beliefs,
plans, objectives, assumptions or future events or performance are not
historical facts and are forward-looking statements. These statements are often,
but not always, made through the use of words or phrases such as "believe,"
"anticipate," "should," "intend," "plan," "will," "expects," "estimates,"
"projects," "positioned," "strategy," "outlook" and similar expressions.
Accordingly, these statements involve estimates, assumptions and uncertainties
which could cause actual results to differ materially from the results expressed
in the statements. Any forward-looking statements are qualified in their
entirety by reference to the factors discussed throughout this prospectus. The
following cautionary statements identify important factors that could cause our
actual results to differ materially from those projected in the forward-looking
statements made in this prospectus. Among the key factors that have a direct
impact on our results of operations are:
- the risks and other factors described under the caption "Risk
Factors" in this prospectus;
- general economic and business conditions;
- industry trends;
- our assumptions about customer acceptance, overall market penetration
and competition from providers of alternative products and services;
- our actual funding requirements; and
- availability, terms and deployment of capital.
Because the risk factors referred to above could cause actual results or
outcomes to differ materially from those expressed in any forward-looking
statements made by us, you should not place undue reliance on any such
forward-looking statements. Further, any forward-looking statement speaks only
as of the date on which it is made, and we undertake no obligation to update any
forward-looking statement or statements to reflect events or circumstances after
the date on which such statement is made or to reflect the occurrence of
unanticipated events. New factors emerge from time to time, and it is not
possible for us to predict which will arise. In addition, we cannot assess the
impact of each factor on our business or the extent to which any factor, or
combination of factors, may cause actual results to differ materially from those
contained in any forward-looking statements.
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WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, along with other
information with the SEC. You may read and copy any document we file at the
public reference facilities maintained by the SEC at 450 Fifth Street, N.W.,
Washington, D.C. 20549 and at the Regional Offices of the SEC at Citicorp
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661; and at 75
Park Place, New York, New York 10007. Please call the SEC at 1-800-SEC-0330 for
further information on the public reference rooms. Our common stock is traded on
The American Stock Exchange and the Toronto Stock Exchange. You may inspect
reports and other information concerning us at the offices of the American Stock
Exchange, Inc., 86 Trinity Place, New York, New York 10006. These filings and
other information may also be inspected without charge at a Web site maintained
by the SEC. The address of the site is http://www.sec.gov.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents we filed with the SEC pursuant to the Exchange
Act are incorporated by reference and made a part of this prospectus:
- Form 20-F for the period ended February 28, 1998.
- The description of our common stock contained in our Form 20-F for
the period ended February 28, 1998.
- Our Annual Report on Form 10-K for the fiscal year ended March 31,
2000.
- Our Quarterly Reports on Form 10-Q for the quarters ended June 30,
2000, September 30, 2000 and December 31, 2000.
- Our Form 8-K filed January 17, 2001.
This prospectus is part of a registration statement filed with the SEC.
The SEC allows us to "incorporate by reference" into this prospectus the
information that we file with them, which means that we can disclose important
information to you by referring you to those documents. The information
incorporated by reference is considered to be part of this prospectus, and
information that we file later with the SEC will automatically update and
supersede this information. We are incorporating by reference the documents
listed above and any future filings that we will make with the SEC under
Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 prior
to the sale of all the shares covered by this prospectus.
We will provide without charge to each person to whom this prospectus is
delivered, upon oral or written request, 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
the information that this prospectus incorporates). Written or telephone
requests should be directed to Shareholder Relations at Genetronics Biomedical
Ltd., 11199 Sorrento Valley Road, San Diego, CA 92121-1334, telephone number
(858) 597-6006. These reports are also available on our web site, the address of
which is http://www.genetronics.com.
You should rely only on the information incorporated by reference or
provided in this prospectus or any supplement. We have not authorized anyone
else to provide you with different information. The selling stockholders will
not make an offer of these shares in any state where the offer is not permitted.
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You should not assume that the information in this prospectus or any supplement
is accurate as of any date other than the date of those documents.
SELLING STOCKHOLDERS
The table below sets forth certain information regarding the selling
stockholders as of January 29, 2001. The shares are being registered to permit
public sales of the shares, and the selling stockholders may offer the shares
for resale from time to time. See "Plan of Distribution." The selling
stockholders may offer all, some or none of the common stock listed below.
None of the selling stockholders has, or in the past three years has
had, any position or office with, been employed by, or otherwise had a material
relationship with us.
The table below sets forth the names of the selling stockholders and the
number of shares owned, directly and beneficially, by such stockholders. If all
of the shares are sold pursuant to this prospectus then the selling stockholders
will own 1,900,000 shares of our common stock or 5.7% of the common stock
outstanding.
NUMBER OF
NUMBER OF SHARES OF
SHARES OF NUMBER OF COMMON STOCK
COMMON SHARES OF BENEFICIALLY
STOCK HELD COMMON STOCK OWNED AFTER PERCENTAGE OF
PRIOR TO THE REGISTERED FOR COMPLETION OF COMMON STOCK
SELLING STOCKHOLDER (1) OFFERING SALE HEREBY(2) THE OFFERING OUTSTANDING(3)
----------------------- ------------ --------------- -------------- --------------
SMALLCAP World Fund, Inc. 2,090,000 440,000 1,650,000 4.9%
American Funds Insurance Series - 810,000 560,000 250,000 *
Global Small Capitalization Fund
---------
* Less than 1 percent.
(1) The name of the selling stockholders and the number of securities held
by the selling stockholders may be amended subsequent hereto pursuant to
Rule 424(b) of the Securities Act of 1933, as amended.
(2) Consists of the number of shares of common stock issued to the selling
stockholder that are registered for sale hereby.
(3) Percentage ownership is based on 33,606,718 shares of our common stock.
The persons and entities named in the table have sole voting and
investment power with respect to all shares beneficially owned.
In recognition of the fact that investors may wish to be legally
permitted to sell their shares when they deem the sale to be appropriate, we
have filed with the SEC under the Securities Act a Registration Statement with
respect to the resale of the shares from time to time and have agreed to prepare
and file such amendments and supplements to the Registration Statement as may be
necessary to keep the Registration Statement effective until the shares are no
longer required to be registered for the sale thereof by the selling
stockholders.
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The shares being offered by the selling stockholders hereunder were
acquired in connection with a private placement of our common stock in January
2001. In that transaction, we granted certain registration rights, pursuant to
which the selling stockholders may register the shares for resale under the
Securities Act.
PLAN OF DISTRIBUTION
We are registering the shares on behalf of the selling stockholders. As
used herein, "selling stockholders" includes donees, pledgees, transferees or
other successors in interest (including, without limitation, corporate or
partnership distributees of the selling stockholders which are privately held
corporations or partnerships) selling shares received from a named selling
stockholder after the date of this prospectus. We will bear all costs, expenses
and fees in connection with the registration of the shares offered hereby. Any
brokerage commissions and similar selling expenses attributable to the sale of
shares will be borne by the selling stockholders. Sales of shares may be
effected by selling stockholders from time to time in one or more types of
transactions (which may include block transactions) on the American Stock
Exchange or on any other market on which our shares may then be trading, in the
over-the-counter market, in negotiated transactions, through put or call options
transactions relating to the shares, through short sales of shares, or a
combination of such methods of sale, at market prices prevailing at the time of
sale, or at negotiated prices. Such transactions may or may not involve brokers,
dealers or underwriters. The selling stockholders have advised us that they have
not entered into any agreements, understandings or arrangements with any
underwriters or broker-dealers regarding the sale of their shares. The selling
stockholders have also advised us that no underwriter or coordinating broker is
acting in connection with the proposed sale of shares by the selling
stockholders, however, the selling stockholders may enter into agreements,
understandings or arrangements with an underwriter or broker-dealer regarding
the sale of their shares in the future.
The selling stockholders may effect sales by selling shares directly to
purchasers or to or through broker-dealers and underwriters, which may act as
agents or principals. These broker-dealers and underwriters may receive
compensation in the form of discounts, concessions, or commissions from the
selling stockholders and/or the purchasers of shares for whom the broker-dealers
and underwriters may act as agents or to whom they sell as principal, or both.
This compensation to a particular broker-dealer or underwriter might be in
excess of customary commissions.
The selling stockholders may enter into hedging transactions with
broker-dealers or other financial institutions. In connection with such
transactions, broker-dealers or other financial institutions may engage in short
sales of our common stock in the course of hedging the positions they assume
with the selling stockholders. The selling stockholders may also enter into
options or other transactions with broker-dealers or other financial
institutions which require the delivery to such broker-dealers or other
financial institutions of shares offered hereby, which shares such
broker-dealers or other financial institutions may resell pursuant to this
prospectus (as supplemented or amended to reflect such transaction).
The selling stockholders and any broker-dealers or underwriters that act
in connection with the sale of shares might be deemed to be "underwriters"
within the meaning of Section 2(11) of the Securities Act, and any commissions
received by broker-dealers or underwriters and any profit on the resale of the
shares sold by them while acting as principals might be deemed to be
underwriting discounts or commissions under the Securities Act. The selling
stockholders may agree to indemnify any agent, dealer, broker-dealer or
underwriter that participates in transactions involving sales of the shares
against certain liabilities, including liabilities arising under the Securities
Act.
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Because selling stockholders may be deemed to be "underwriters" within
the meaning of Section 2(11) of the Securities Act, the selling stockholders
will be subject to the prospectus delivery requirements of the Securities Act
and the rules promulgated thereunder. We have informed the selling stockholders
that the anti-manipulative provisions of Regulation M promulgated under the
Exchange Act may apply to their sales in the market.
Selling stockholders also may resell all or a portion of the shares in
open market transactions in reliance upon Rule 144 under the Securities Act,
provided they meet the criteria and conform to the requirements of that rule.
All or any part of the shares offered hereby may or may not be sold by
the selling stockholders.
After being notified by a selling stockholder that any material
arrangement has been entered into with a broker-dealer or underwriter for the
sale of shares through a block trade, special offering, exchange distribution or
secondary distribution or a purchase by a broker, dealer or underwriter, we will
file a supplement to this prospectus, if required, pursuant to Rule 424(b) under
the Securities Act, disclosing (i) the name of each such selling stockholder and
of the participating broker-dealer(s) or underwriter(s), (ii) the number of
shares involved, (iii) the price at which such shares were sold, (iv) the
commissions paid or discounts or concessions allowed to such broker-dealer(s) or
underwriter(s), where applicable, (v) that such broker-dealer(s) or
underwriter(s) did not conduct any investigation to verify the information set
out or incorporated by reference in this prospectus and (vi) other facts
material to the transaction. Individuals and entities who receive shares from
the selling stockholders as a gift or in connection with a pledge may sell up to
500 of such shares pursuant to this prospectus.
USE OF PROCEEDS
We will not receive any proceeds from the sale of the common stock by
the selling stockholders.
LEGAL MATTERS
The validity of the shares is being passed upon by Catalyst Corporate
Finance Lawyers, Vancouver, British Columbia.
EXPERTS
The consolidated financial statements of Genetronics Biomedical Ltd.
appearing in Genetronics Biomedical Ltd.'s Annual Report on Form 10-K for the
year ended March 31, 2000, have been audited by Ernst &Young LLP, independent
auditors, as set forth in their report thereon included therein and incorporated
herein by reference. Such consolidated financial statements are incorporated
herein by reference in reliance upon such report given on the authority of such
firm as experts in accounting and auditing.
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1,000,000 Shares of Common Stock
PROSPECTUS
WE HAVE NOT AUTHORIZED ANY DEALER, SALESPERSON OR OTHER PERSON TO GIVE YOU
WRITTEN INFORMATION OTHER THAN THIS PROSPECTUS OR TO MAKE REPRESENTATION AS TO
MATTERS NOT STATED IN THE PROSPECTUS. YOU MUST NOT RELY ON UNAUTHORIZED
INFORMATION. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES OR OUR
SOLICITATION OF YOUR OFFER TO BUY THE SECURITIES IN ANY JURISDICTION WHERE THAT
WOULD NOR BE PERMITTED. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALES
MADE HEREUNDER AFTER THE DATE OF THIS PROSPECTUS SHALL CREATE AN IMPLICATION
THAT THE INFORMATION CONTAINED HEREIN OR OUR AFFAIRS HAVE NOT CHANGED SINCE THE
DATE HEREOF.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Other expenses in connection with the registration of the common stock
hereunder will be substantially as follows (all expenses other than the SEC
Registration Fee are estimates):
Company
Item Expense
---- -------
SEC Registration Fee .......... $ 318
Printing and engraving expenses $ 1,000
Legal fees and expenses ....... $10,000
Accounting Fees and expenses .. $10,000
Miscellaneous ................. $ 8,000
-------
Total .................. $29,318
=======
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
As specified in our Articles of Incorporation, subject to the provisions
of the Company Act (British Columbia), our directors shall cause us to indemnify
a director or a former director of ours and the directors may cause us to
indemnify a director or former director of a corporation of which we are or were
a member and the heirs and personal representatives of any such person against
all costs, charges and expenses, including an amount paid to settle an action or
satisfy a judgment, actually and reasonably incurred by him or them including an
amount paid to settle an action or satisfy a judgment in a civil, criminal or
administrative action or proceeding to which he is or they are made a party by
reason of his being or having been a director of ours or a director of such
corporation, including any action brought by us or any such corporation. Each of
our directors on being elected or appointed shall be deemed to have contracted
with us on the terms of the foregoing indemnity.
Additionally, our directors may cause us to indemnify any of our
officers, employees or agents, or of any corporation of which we are or were a
member, and his heirs and personal representatives, against all costs, charges
and expenses whatsoever incurred by him or them and resulting from his acting as
our officer, employee or agent or such corporation. We shall also indemnify our
Secretary and any Assistant Secretary, if he is not a full-time employee and
notwithstanding that he may also be a director and his respective heirs and
legal representatives against all costs, charges and expenses whatsoever
incurred by him or them and arising out of the functions assigned to the
Secretary by the Company Act (British Columbia) or our Articles of Incorporation
and each such Secretary and Assistant Secretary shall, on being appointed be
deemed to have contracted with us on the terms of the foregoing indemnity.
Our directors may cause us to purchase and maintain insurance for the
benefit of any person who is or was serving as a director, officer, employee or
agent of ours or as a director, officer, employee or agent of any corporation of
which we are or were a stockholder and his heirs or personal representatives
against any liability incurred by him as such director, officer, employee or
agent.
These indemnification provisions and the indemnification agreements
entered into between us and our executive officers and directors may be
sufficiently broad to permit indemnification of our executive officers and
directors for liabilities (including reimbursement of expenses incurred) arising
under the Securities Act of 1933, as amended (the "Securities Act").
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ITEM 16. EXHIBITS
4.1* Articles of Incorporation
4.2* Bylaws
5.1 Opinion and Consent of Catalyst Corporate Finance Lawyers
23.1 Consent of Ernst & Young LLP
24.1 Power of Attorney (included in Part II of the Registration Statement)
* Incorporated by reference from the Form 20-F for the period ended February 28,
1998.
ITEM 17. UNDERTAKINGS
The undersigned Registrant hereby undertakes:
1. To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
a) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933 (the "Securities Act");
b) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or
in the aggregate, represent a fundamental change in the
information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in
volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered)
and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if,
in the aggregate, the changes in volume and price represent no
more than a 20% change in the maximum aggregate offering price
set forth in the "Calculation of Registration Fee" table in the
effective registration statement;
c) To include any material information with respect to the plan of
distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement; provided, however, that paragraphs
(a)(1)(i) and (a)(1)(ii) do not apply if the information
required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the
Registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by
reference in the registration statement.
2. That, for the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
3. To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the
termination of the offering.
4. The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to section 13(a) or section 15(d) of
the Securities Exchange Act of 1934 that is incorporated by reference in
the
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registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
5. The undersigned Registrant hereby undertakes to deliver or cause to be
delivered with the prospectus, to each person to whom the prospectus is
sent or given, the latest annual report to security holders that is
incorporated by reference in the prospectus and furnished pursuant to
and meeting the requirements of Rule 14a-3 or Rule 14c-3 under the
Securities Exchange Act of 1934; and, where interim financial
information required to be presented by Article 3 of Regulation S-X are
not set forth in the prospectus, to deliver, or cause to be delivered to
each person to whom the prospectus is sent or given, the latest
quarterly report that is specifically incorporated by reference in the
prospectus to provide such interim financial information.
6. 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 Securities and
Exchange 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.
7. The undersigned Registrant hereby undertakes that:
a) For the purposes of determining any liability under the
Securities Act, 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 shall be deemed to be part of the
registration statement as of the time it was declared effective.
b) For the purposes of determining any liability under the
Securities Act, each post-effective amendment that contains a
form of prospectus shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
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SIGNATURES
Pursuant to the requirements of the Securities Act, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements of 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 San Diego, State of California, on February 14, 2001.
Genetronics Biomedical Ltd.
By: /s/ Martin Nash
-------------------------------------
Martin Nash
President, Chief Executive Officer
POWER OF ATTORNEY
We, the undersigned officers and directors of Genetronics Biomedical
Ltd., hereby severally constitute Martin Nash and Mervyn McCulloch our true and
lawful attorneys with full power to sign for us and in our names, in the
capacities indicated below, the registration statement filed herewith and any
and all amendments to said registration statement, and generally to do all such
things in our names and behalf in our capacities as officers and directors to
enable Genetronics Biomedical Ltd. to comply with the provisions of the
Securities Act of 1933, and all requirements of the Securities and Exchange
Commission, hereby ratifying and confirming our signatures as they may be signed
by our said attorney to said registration statement and any and all amendments
thereto.
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons in the capacities and
on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ Martin Nash President Chief Executive Officer February 14, 2001
---------------------------------- (Principal Executive Officer),
Martin Nash Director
/s/ Mervyn McCulloch Chief Financial Officer February 14, 2001
---------------------------------- (Principal Financial and
Mervyn McCulloch Accounting Officer)
/s/ James L. Heppell Director February 14, 2001
----------------------------------
James L. Heppell
/s/ Gordon J. Politeski Director February 14, 2001
----------------------------------
Gordon J. Politeski
/s/ Suzanne L. Wood Director February 14, 2001
----------------------------------
Suzanne L. Wood
/s/ Felix Theeuwes Director February 14, 2001
----------------------------------
Felix Theeuwes
/s/ Tazdin Esmail Director February 14, 2001
----------------------------------
Tazdin Esmail
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Signature Title Date
--------- ----- ----
/s/ Grant W. Denison, Jr. Director February 14, 2001
----------------------------------
Grant W. Denison, Jr.
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INDEX TO EXHIBITS
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
------- -----------------------
4.1* Articles of Incorporation
4.2* Bylaws
5.1 Opinion and Consent of Catalyst Corporate Finance Lawyers
23.1 CONSENT OF ERNST & YOUNG LLP
24.1 Power of Attorney (included in Part II of the Registration Statement)
* Incorporated by reference from the Form 20-F for the period ended February 28,
1998.
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