UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(d)
OF
THE
SECURITIES EXCHANGE ACT OF 1934
Date of
Report (Date of earliest event reported): April 1, 2005
Manhattan
Pharmaceuticals, Inc.
(Exact
name of registrant as specified in its charter)
|
Delaware |
000-27282 |
36-3898269 |
|
(State
or other jurisdiction of incorporation) |
(Commission
File Number) |
(IRS
Employer Identification No.) |
|
810
Seventh Avenue, 4th Floor |
10019 |
|
(Address
of principal executive offices) |
(Zip
Code) |
(212)
582-3950
(Registrant's
telephone number, including area code)
(Former
name or former address, if changed since last report)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
o Written communications pursuant to Rule 425 under the
Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under
the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule
14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule
13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item
1.01. Entry
into a Material Definitive Agreement.
(a)
On April
1, 2005, Manhattan Pharmaceuticals, Inc. (the “Company”) entered into an
Agreement and Plan of Merger (the “Agreement”) with Tarpan Therapeutics, Inc., a
Delaware corporation (“Tarpan”), and Tarpan Acquisition Corp., a Delaware
corporation and wholly-owned subsidiary of the Company (“TAC”). The Agreement
provided that TAC would merge with and into Tarpan, with Tarpan remaining as the
surviving corporation and a wholly-owned subsidiary of the Company (the
“Merger”). The Merger was completed April 1, 2005. In consideration for their
shares of Tarpan capital stock and in accordance with the Agreement, the
stockholders of Tarpan received a number of shares of the Company’s common stock
such that, upon the effective time of the Merger, the Tarpan stockholders
collectively received (or are entitled to receive) approximately 20 percent
of the Company’s outstanding common stock on a fully-diluted basis (i.e.,
assuming the issuance of common stock underlying outstanding options, warrants
and other rights). Based on the number of fully-diluted outstanding shares of
the Company’s common stock on the date of the Merger, the current stockholders
of Tarpan will receive an aggregate of approximately 10,731,052 shares of the
Company’s common stock in the Merger. At the time of the Merger, Tarpan had
outstanding indebtedness of approximately $648,000 resulting from a series of
promissory notes issued to Paramount BioCapital Investments, LLC and Horizon
BioMedical Ventures, LLC, both of which are owned or controlled by Dr. Lindsay
Rosenwald. The notes were amended at the time of the Merger to provide that
one-half of the outstanding indebtedness was payable upon completion of the
Merger and the remaining one-half will be payable at such time as the Company
raises at least $5 million in new financing. A press release dated April 4, 2005
announcing the Merger is attached to this Form 8-K as Exhibit 99.1 and
incorporated herein by reference.
Several
of Tarpan’s former stockholders are directors or significant stockholders of the
Company. Dr. Rosenwald and various trusts established for the benefit of Dr.
Rosenwald and members of his immediate family collectively beneficially owned
approximately 46 percent of Tarpan’s common stock and beneficially own
approximately 26 percent our common stock. In addition, Joshua Kazam, David
Tanen, Dr. Michael Weiser and Timothy McInerney, all of whom are members of the
Company’s board of directors, collectively owned approximately 13.4 percent of
Tarpan’s outstanding common stock. Dr. Weiser and Mr. McInerney are also
employed by Paramount BioCapital, Inc., an entity owned and controlled by Dr.
Rosenwald. As a result of such relationships between the Company and Tarpan, the
Company’s board of directors established a special committee to consider and
approve the Agreement. The special committee consisted of Neil Herskowitz,
Malcolm Hoenlein and Richard Steinhart, none of whom had any prior relationship
with Tarpan.
(b) In
accordance with the terms of the Agreement and as previously disclosed in the
Company’s Current Report on Form 8-K filed on January 6, 2005, upon completion
of the Merger, Douglas Abel, currently chief executive officer of Tarpan, was
appointed president and chief executive officer of the Company. Pursuant to the
Agreement, the Company entered into an Employment Agreement dated April 1, 2005
with Mr. Abel, the terms of which are described under Item 5.02 of this
Report.
Item
2.01. Completion
of Acquisition or Disposition of Assets.
The
disclosures set forth in paragraph (a) of Item 1.01 are hereby incorporated by
reference into this Item 2.01.
Item
3.02. Unregistered
Sales of Equity Securities.
As
disclosed under Item 1.01 above, in connection with the Merger, the Company
issued an aggregate of 10,731,052
shares of
its common stock to the former holders of Tarpan common stock. The Company
relied on the exemption from federal registration under Section 4(2) of the
Securities Act of 1933, as amended, and Rule 506 promulgated thereunder, based
on its belief that the issuance of such securities did not involve a public
offering, as there were fewer than 35 “non-accredited” investors, all of whom,
either alone or through a purchaser representative, had such knowledge and
experience in financial and business matters so that each was capable of
evaluating the risks of the investment.
Item
5.02. Departure
of Directors or Principal Officers; Election of Directors; Appointment of
Principal Officers.
Effective
as of April 1, 2005, the Company named Mr. Abel as its President and Chief
Executive Officer. Mr. Abel is a biotech and specialty pharmaceutical veteran
with more than 15 years of high-level experience in the field. Mr. Abel was most
recently with Tarpan where he served as President and CEO from November 2004 to
March 2005. From August 2000 to November 2004, Mr. Abel served as Vice President
of the Dermatology Business Unit at Biogen Idec (“Biogen”). While at Biogen, Mr.
Abel led the creation of the U.S. dermatology commercial operation, building the
team from two to more than 100 employees to support the launch of AMEVIVE®.
Prior to his position with Biogen, Mr. Abel was at Allergan Pharmaceuticals from
December 1987 to August of 2000, with his most recent position being Director of
BOTOX® Marketing. Mr. Abel received his A.B. in chemistry from Lafayette College
and an M.B.A. from Temple University
The
Company and Mr. Abel entered in an Employment Agreement dated April 1, 2005
whereby Mr. Abel will serve as the Compay’s President and Chief Executive
Officer for a period of three years in exchange for (i) an annual base salary of
$300,000, subject to a retroactive increase in the amount of $25,000 in the
event that the Company completes a financing transaction of at least $5,000,000,
(ii) a signing bonus in the amount of $200,000 payable in two installments of
$100,000 in May and November 2005, respectively, (iii) a discretionary
performance-based bonus in an amount equal to up to 50% of Mr. Abel’s base
salary, and (iv) an option to purchase 2,923,900 shares of the Company’s common
stock at $1.50 per share with three-year annual vesting, purchasable for a
10-year term. The Employment Agreement contains customary provisions relating to
confidentiality, work-product assignment, non-competition and
non-solicitation. In the
event Mr. Abel's employment is terminated during the term of the agreement, the
Company is required to pay a severance payment ranging from between 6 and 12
month of base salary, depending upon the circumstances of such
termination
Effective
as of April 1, 2005, Mr. Abel was also appointed to the Company’s Board of
Directors. It is not anticipated that Mr. Abel will be appointed to serve on any
committees of the Board of Directors.
Item
9.01. Financial
Statements and Exhibits.
(a) As a
result of its acquisition of Tarpan described in Item 1.01, the Company will
file the financial statements required by Item 9.01on June 17,
2005.
(b) As a
result of its acquisition of Tarpan described in Item 1.01, the Company will
file the pro forma financial information required by Item 9.01 on June 17,
2005.
(c) Exhibits
Ex.
No. Description
99.1 Press
Release dated April 4, 2005.
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
| Manhattan Pharmaceuticals, Inc. | ||
| |
|
|
| Date: April 7, 2005 | By: | /s/ Nicholas J. Rossettos |
|
Nicholas J. Rossettos | ||
| Chief Financial Officer | ||
EXHIBIT
INDEX
Ex.
No.
Description
99.1
Press
release dated April 4, 2005.
Exhibit
99.1
Manhattan
Pharmaceuticals Acquires Tarpan Therapeutics
Monday
April 4, 8:30 am ET
Douglas
Abel Becomes Chief Executive Officer
Development
Portfolio Now Includes Therapeutics for Psoriasis, Obesity and
a
Lingual Spray for Pre-Procedural Sedation
NEW
YORK--(BUSINESS WIRE)--April 4, 2005-- Manhattan Pharmaceuticals, Inc.
("Manhattan" OTCBB: MHTT), has acquired Tarpan Therapeutics, Inc. ("Tarpan"), a
privately-held, New York-based pharmaceutical company, in an all stock
transaction that resulted in Tarpan shareholders owning approximately 20% of the
shares of Manhattan on a fully-diluted basis.
Douglas
Abel, formerly CEO of Tarpan, has been named President and Chief Executive
Officer of Manhattan as of the completion of the transaction. Abel is a biotech
and specialty pharmaceutical veteran with more than 15 years of high-level
experience in the field. He has also been appointed to Manhattan's board of
directors.
Manhattan's
corporate development strategy is to address various large, underserved medical
markets. Towards that goal, Manhattan now has three product candidates:
PTH
(1-34), which was being developed by Tarpan, is a peptide under development for
psoriasis and other dermatological conditions believed to be a regulator of
epidermal cell growth. An initial Phase I/II has been completed; Company
initiation of a Phase II trial is anticipated in 2005.
Oleoyl
estrone (OE) is an orally administered small molecule in Phase I trials that has
been shown in extensive preclinical animal studies to cause significant weight
loss, without the need for dietary modifications. On February 3, 2005, under a
U.S. Investigational New Drug application (IND), Manhattan began dosing patients
in its first Phase I clinical trial being conducted in Basel, Switzerland to
evaluate the safety and tolerability of defined doses of orally administered OE
in obese adults.
Propofol
Lingual Spray (Propofol LS) is a fast-acting, quick-recovery sedative for use
during diagnostic and therapeutic procedures that is being jointly developed
with Novadel Pharma Inc. (AMEX: NVD -
News). On
January 27, 2005, the U. S. Food and Drug Administration (FDA) accepted an IND
from Manhattan for the initiation of the Phase I human clinical
trials.
"Manhattan
is now well positioned with an advancing and diversified product pipeline," said
Doug Abel, new CEO of Manhattan. "Our products have tremendous potential in
their respective markets. I am fully committed to driving shareholder value by
assembling and deploying a world-class development team to guide our ongoing
clinical trials towards commercialization."
Background
on Doug Abel
Prior to
becoming President and CEO of Tarpan, Mr. Abel served as Vice President of the
Dermatology Business Unit at Biogen Idec where he worked from August 2000 to
November 2004. While at Biogen, he led the creation of the U.S. dermatology
commercial operation, building the team from two to more than 100 employees to
support the launch of AMEVIVE®. Before that, Mr. Abel was at Allergan
Pharmaceuticals from December 1987 to August of 2000, with his most recent
position being Director of BOTOX® Marketing. Mr. Abel received his A.B. in
chemistry from Lafayette College and an M.B.A. from Temple University.
Background
on PTH (1-34)
Researchers,
led by Michael Holick, MD, PhD, Professor of Medicine, Physiology, and
Biophysics at Boston University Medical Center, recently reported positive
results from a U.S. Phase I/II clinical trial evaluating the safety and efficacy
of PTH (1-34) as a topical treatment for psoriasis. This double-blinded,
controlled trial in 15 patients comparing PTH (1-34) formulated in the Novasome®
technology versus the Novasome® vehicle alone, showed PTH (1-34) to be a
potentially safe and effective treatment for plaque psoriasis. Following eight
weeks of treatment, the application of PTH (1-34) resulted in complete clearing
of the treated lesion in 60% of patients and partial clearing in 85% of
patients. Additionally, there was a statistically significant improvement in the
global severity score. Ten patients continued into an open label extension study
in which the Psoriasis Area and Severity Index (PASI) was measured. In this
study, PASI improvement across all ten patients achieved statistically
significant improvement compared to baseline. No patients experienced any
significant adverse events.
Due to
the high response rate seen in psoriasis patients in the initial trial, PTH
(1-34) may have an important clinical advantage over current topical psoriasis
treatments. Manhattan intends to initiate additional clinical activities with
PTH (1-34) in 2005. Manhattan has the rights to issued and pending patents for
all topical uses of PTH (1-34) as well as access to the Novasome® technology and
patents for these applications. Novasome® is a registered trademark of IGI,
Inc., Buena, NJ (Amex: IG -
News).
Background
on Oleoyl estrone
Oleoyl
estrone is an orally administered form of a naturally occurring molecule shown,
in extensive preclinical animal studies, to cause significant weight loss
without the need for dietary modifications. In such studies, OE appears to be
safe and effective with no evidence of rebound weight gain after treatment has
been discontinued. OE may prove to be a safe and effective treatment for
obesity, representing a significant improvement over currently available
anti-obesity medications. On February 3, 2005, following permission from the
FDA, the first dosing of patients in a Phase I clinical trial began in Basel,
Switzerland.
Background
on Propofol LS
Propofol
Lingual Spray is being developed as a safe and convenient, non-invasive
formulation of propofol, the world's best selling intravenous general
anesthetic. Manhattan believes that the delivery of propofol via a lingual spray
will provide many advantages over currently formulated sedatives, to the benefit
of patients undergoing innumerable diagnostic and therapeutic procedures each
year. In particular, clinicians would have the ability to tightly control the
onset, duration, and depth of sedation, with a level of reliability and accuracy
previously unknown, promoting improved procedural outcomes as well as patient
comfort and satisfaction.
Manhattan's
pilot Phase I study of Propofol LS, conducted in the United Kingdom, was a
single-center, randomized, double-blind, placebo-controlled dose-escalating
study of propofol lingual spray in twelve healthy adult volunteers. The study
was conducted using a formulation of Propofol LS packaged in single-dose
actuators designed to deliver the formulation in a fine mist to the oral
mucousmembranes. Propofol LS was detectable in blood as early as four minutes
following spray administration and resulted in a mean time to maximum blood
concentration of approximately 30 minutes across all doses. The mean maximum
blood concentrations plateaued at the highest of the three doses tested, with
mean bioavailability of the current spray formulation up to 18% of that of the
intravenous formulation. No serious adverse events, nor dose-dependent changes
in laboratory parameters or vital signs, occurred in any group.
Physical
characteristics and stability data for the formulation of Propofol LS used in
this trial were recently presented by Manhattan at the 79th Clinical and
Scientific Congress of the International Anesthesia Research Society, in
Honolulu in March 2005.
On
January 27, 2005, the FDA accepted an IND from Manhattan for the initiation of
the human clinical trials that will be required for FDA approval of Propofol LS.
Propofol
LS is being jointly developed with Novadel Pharma Inc (Amex: NVD -
News).
About
Manhattan Pharmaceuticals, Inc.
Manhattan
Pharmaceuticals, Inc. (http://www.manhattanpharma.com/), a
development-stage pharmaceutical company, acquires and develops proprietary
prescription drugs for large, underserved patient populations.
About
NovaDel Pharma Inc.
NovaDel
Pharma, Inc. is a specialty pharmaceutical company engaged in the development of
novel drug delivery systems for prescription and over-the- counter drugs. The
company's proprietary lingual spray technology delivery system offers the
patient the potential for (i) fast onset of action; (ii) improved drug safety by
reducing the required drug dosage and reducing side effects; (iii) improved
patient convenience and compliance; and (iv) enhanced dosage reliability. The
company plans to develop such products independently and through collaborative
arrangements with major pharmaceutical and biotech companies. More information
about NovaDel can be found on its website at http://www.NovaDel.com.
About
IGI, Inc.
IGI is a
company committed to growth by applying proprietary technologies to achieve
cost-effective solutions for varied customer needs. IGI offers the patented
Novasome® nano-vesicular, transdermal delivery technology which contributes
value-added qualities to cosmetics, skin care products, dermatological
formulations and other consumer products, providing improved dermal absorption,
controlled and sustained release as well as improved stability and greater ease
of formulation. IGI has licensed Novasome® nano-vesicular delivery technology to
leading global dermatological and skin care companies including Johnson &
Johnson Consumer Products, Inc., Estee Lauder Corporation, Chattem Inc., Genesis
Pharmaceutical, Inc. and Apollo Pharmaceutical, Inc., and recently sub-licensed
the rights to obtain FDA approval for and market IGI's PTH (1-34) compound using
Novasome® nano-vesicular delivery technology for psoriasis, which is slated for
Phase II clinical trials, to Tarpan Pharmaceuticals, Inc. IGI is also exploring
the licensing of the topical PTH (7-34) compound for the prevention/treatment of
chemotherapy induced-alopecia in patients undergoing chemotherapy.
CERTAIN
STATEMENTS CONTAINED IN THIS NEWS RELEASE THAT ARE FORWARD-LOOKING IN NATURE ARE
BASED ON THE CURRENT BELIEFS AND ASSUMPTIONS OF OUR MANAGEMENT. WHEN USED IN
THIS PRESS RELEASE, THE WORDS "MAY," "COULD," "SHOULD," "ANTICIPATE," "BELIEVE,"
"ESTIMATE," "EXPECT," "INTEND," "PLAN," "PREDICT," AND SIMILAR EXPRESSIONS AND
THEIR VARIANTS MAY BE USED TO IDENTIFY FORWARD-LOOKING STATEMENTS. SUCH
STATEMENTS ARE VALID ONLY AS OF TODAY, AND WE DISCLAIM ANY OBLIGATION TO UPDATE
THIS INFORMATION. THESE STATEMENTS ARE SUBJECT TO KNOWN AND UNKNOWN RISKS AND
UNCERTAINTIES THAT MAY CAUSE ACTUAL FUTURE EXPERIENCE AND RESULTS TO DIFFER
MATERIALLY FROM THE STATEMENTS MADE. THESE STATEMENTS ARE BASED ON OUR CURRENT
BELIEFS AND EXPECTATIONS AS TO SUCH FUTURE OUTCOMES. DRUG DISCOVERY AND
DEVELOPMENT INVOLVE A HIGH DEGREE OF RISK. FACTORS THAT MIGHT CAUSE SUCH A
MATERIAL DIFFERENCE INCLUDE, AMONG OTHERS, UNCERTAINTIES RELATED TO THE ABILITY
TO ATTRACT AND RETAIN PARTNERS FOR OUR TECHNOLOGIES, THE IDENTIFICATION OF LEAD
COMPOUNDS, THE SUCCESSFUL PRECLINICAL DEVELOPMENT THEREOF, THE COMPLETION OF
CLINICAL TRIALS, THE FDA REVIEW PROCESS AND OTHER GOVERNMENTAL REGULATION, OUR
PHARMACEUTICAL COLLABORATOR'S ABILITY TO SUCCESSFULLY DEVELOP AND COMMERCIALIZE
DRUG CANDIDATES, COMPETITION FROM OTHER PHARMACEUTICAL COMPANIES, PRODUCT
PRICING AND THIRD PARTY REIMBURSEMENT, AND OTHER FACTORS DESCRIBED IN OUR
FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION.
Contact:
Manhattan
Pharmaceuticals, Inc.
Nicholas
Rossettos
212/582-3950
or
Investor
Contacts:
Investor
Relations Group
Kathryn
McNeil, John Nesbett, Dian Griesel, Ph.D.
212/825-3210
or
Media
Contacts:
Investor
Relations Group
Andrea
Faville, Dian Griesel, Ph.D.
212/825-3210
Source:
Manhattan Pharmaceuticals