x
|
ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
|
For
the fiscal year ended December 31, 2005
|
|
or
|
|
¨
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
|
For
the transition period
from ___________ to ___________
|
Delaware
|
13-3379479
|
(State
or other jurisdiction of
incorporation
or organization)
|
(I.R.S.
Employer Identification
Number)
|
Securities
Registered pursuant to Section 12(g) of the
Act:
|
Common
Stock, par value $0.0013 per share
|
(Title
of Class)
|
(1)
|
Calculated
by excluding all shares that may be deemed to be beneficially owned
by
executive officers, directors and five percent stockholders of
the
Registrant, without conceding that any such person is an “affiliate” of
the Registrant for purposes of the Federal securities
laws.
|
PART
I
|
||
Item
1.
|
1
|
|
Item
1A.
|
20
|
|
Item
1B.
|
30
|
|
Item
2.
|
30
|
|
Item
3.
|
30
|
|
Item
4.
|
30
|
|
PART
II
|
||
Item
5.
|
31
|
|
Item
6.
|
32
|
|
Item
7.
|
33
|
|
Item
7A.
|
51
|
|
Item
8.
|
51
|
|
Item
9.
|
51
|
|
Item
9A.
|
51
|
|
Item
9B.
|
52
|
|
PART
III
|
||
Item
10.
|
53
|
|
Item
11.
|
58
|
|
Item
12.
|
64
|
|
Item
13.
|
66
|
|
Item
14.
|
67
|
|
PART
IV
|
||
Item
15.
|
68
|
|
F-1
|
||
S-1
|
||
E-1
|
Program/Product
Candidates
|
Indication/Use
|
Status
(1)
|
||
Symptom
Management and Supportive Care
|
||||
MNTX-Subcutaneous
|
Treatment
of opioid-induced constipation
|
Phase
3 completed in patients with advanced medical illness
|
||
MNTX-Intravenous
|
Management
of post-operative bowel dysfunction
|
Phase
3 planned
|
||
MNTX-Oral
|
Treatment
of opioid-induced constipation
|
Phase
2 planned in patients with chronic pain
|
||
HIV
|
||||
PRO
140
|
Treatment
of HIV infection
|
Phase
1b
|
||
ProVax
|
Treatment
of HIV infection
|
Research
|
||
Prostate
Cancer
|
||||
PSMA
(2):
|
||||
Recombinant
protein vaccine
|
Immunotherapy
for prostate cancer
|
Phase
1
|
||
Viral-vector
vaccine
|
Immunotherapy
for prostate cancer
|
Preclinical
|
||
Monoclonal
antibody-drug conjugate
|
Treatment
of prostate cancer
|
Preclinical
|
||
Other
|
||||
GMK
vaccine
|
Immunotherapy
for melanoma
|
Phase
3
|
||
Hepatitis
C virus (HCV)
|
Treatment
of HCV infection
|
Research
|
· |
the
longer of 17 years from the date of issue or 20 years from the
earliest
asserted filing date of the corresponding patent application, if
the
patent application was filed prior to June 8, 1995;
and
|
· |
20
years from the earliest asserted filing date of the corresponding
patent
application, if the application was filed on or after June 8,
1995.
|
· |
preclinical
laboratory and animal tests;
|
· |
submission
to the FDA of an investigational new drug application, or IND,
which must
become effective before clinical trials may
begin;
|
· |
adequate
and well-controlled human clinical trials to establish the safety
and
efficacy of the product for its intended
indication;
|
· |
submission
to the FDA of a marketing application;
and
|
· |
a
description of the sponsor’s investigational
plan;
|
· |
protocols
for each planned study;
|
· |
chemistry,
manufacturing, and control
information;
|
· |
pharmacology
and toxicology information; and
|
· |
a
summary of previous human experience with the investigational
drug.
|
· |
chemistry,
manufacturing, and controls;
|
· |
non-clinical
pharmacology and toxicology;
|
· |
human
pharmacokinetics and bioavailability;
and
|
· |
clinical
data.
|
· |
evaluate
preliminarily the efficacy of the product for specific, targeted
indications;
|
· |
determine
dosage tolerance and optimal dosage;
and
|
· |
identify
possible adverse effects and safety
risks.
|
· |
efficacy
and safety of our products;
|
· |
timing
and scope of regulatory approval;
|
· |
product
reliability and availability;
|
· |
sales,
marketing and manufacturing
capabilities;
|
· |
capabilities
of our collaborators;
|
· |
reimbursement
coverage from insurance companies and
others;
|
· |
degree
of clinical benefits of our product candidates relative to their
costs;
|
· |
method
of administering a product;
|
· |
price;
and
|
· |
patent
protection.
|
·
|
the
results of preclinical studies may be inconclusive, or they may
not be
indicative of results that will be obtained in human clinical
trials;
|
·
|
potential
products may not have the desired efficacy or may have undesirable
side
effects or other characteristics that preclude marketing approval
or limit
their commercial use if approved;
|
·
|
after
reviewing test results, we or our collaborators may abandon projects,
which we previously believed to be promising;
and
|
·
|
we,
our collaborators or regulators may suspend or terminate clinical
trials
if we or they believe that the participating subjects or patients
are
being exposed to unacceptable health
risks.
|
·
|
deaths
or other adverse medical events involving patients or subjects
in our
clinical trials;
|
·
|
regulatory
or patent issues;
|
·
|
interim
or final results of ongoing clinical
trials;
|
·
|
failure
to enroll clinical sites as
expected;
|
·
|
competition
for enrollment from clinical trials conducted by others in similar
indications;
|
·
|
scheduling
conflicts with participating clinicians and clinical institutions;
and
|
·
|
manufacturing
problems.
|
·
|
they
might not obtain labeling claims necessary to make the product
commercially viable (in general, labeling claims define the medical
conditions for which a drug product may be marketed, and are therefore
very important to the commercial success of a
product);
|
·
|
we
or our collaborators might be required to undertake post-marketing
trials
to verify the product’s efficacy or
safety;
|
·
|
we,
our collaborators or others might identify side effects after the
product
is on the market, or we or our collaborators might experience
manufacturing problems, either of which could result in subsequent
withdrawal of marketing approval, reformulation of the product,
additional
preclinical testing or clinical trials, changes in labeling of
the product
or the need for additional marketing applications;
and
|
·
|
we
and our collaborators will be subject to ongoing FDA obligations
and
continuous regulatory review.
|
·
|
the
results of clinical trials and preclinical studies involving our
products
or those of our competitors;
|
·
|
changes
in the status of any of our drug development programs, including
delays in
clinical trials or program
terminations;
|
·
|
developments
regarding our efforts to achieve marketing approval for our
products;
|
·
|
developments
in our relationship with Wyeth regarding the development and
commercialization of MNTX;
|
·
|
announcements
of technological innovations or new commercial products by us,
our
collaborators or our competitors;
|
·
|
developments
in our relationships with other collaborative
partners;
|
·
|
developments
in patent or other proprietary
rights;
|
·
|
governmental
regulation;
|
·
|
changes
in reimbursement policies or health care
legislation;
|
·
|
public
concern as to the safety and efficacy of products developed by
us, our
collaborators or our competitors;
|
·
|
our
ability to fund on-going
operations;
|
·
|
fluctuations
in our operating results; and
|
·
|
general
market conditions.
|
·
|
make
the takeover of Progenics or the removal of our Board of Directors
or
management more difficult;
|
·
|
discourage
hostile bids for control of Progenics in which stockholders may
receive a
premium for their shares of common stock;
and
|
·
|
otherwise
dilute the rights of holders of our common stock and depress the
market
price of our common stock.
|
High
|
Low
|
||||||
Year
ended December 31, 2004
|
|||||||
First
quarter
|
$
|
23.45
|
$
|
17.60
|
|||
Second
quarter
|
20.79
|
14.85
|
|||||
Third
quarter
|
16.92
|
8.50
|
|||||
Fourth
quarter
|
18.08
|
12.25
|
|||||
Year
ended December 31, 2005
|
|||||||
First
quarter
|
24.40
|
14.09
|
|||||
Second
quarter
|
21.35
|
15.76
|
|||||
Third
quarter
|
25.07
|
20.60
|
|||||
Fourth
quarter
|
27.00
|
20.73
|
Years
Ended December 31,
|
|||||||||||||||||||
2001
|
2002
|
2003
|
2004
|
2005
|
|||||||||||||||
(in
thousands, except per share data)
|
|||||||||||||||||||
Statement
of Operations Data:
|
|||||||||||||||||||
Revenues:
|
|||||||||||||||||||
Contract
research and development, joint venture
|
$
|
199
|
$
|
5,298
|
$
|
2,486
|
$
|
2,008
|
$
|
988
|
|||||||||
Contract
research and development, other
|
4,397
|
194
|
|||||||||||||||||
Research
grants and contracts
|
4,244
|
4,544
|
4,826
|
7,483
|
8,432
|
||||||||||||||
Product
sales
|
43
|
49
|
149
|
85
|
66
|
||||||||||||||
Total
revenues
|
8,883
|
10,085
|
7,461
|
9,576
|
9,486
|
||||||||||||||
Expenses:
|
|||||||||||||||||||
Research
and development
|
12,731
|
22,797
|
26,374
|
35,673
|
43,419
|
||||||||||||||
License
fees - research and development
|
1,770
|
964
|
867
|
390
|
20,418
|
||||||||||||||
General
and administrative
|
6,499
|
6,484
|
8,029
|
12,580
|
13,565
|
||||||||||||||
Loss
in Joint Venture
|
2,225
|
2,886
|
2,525
|
2,134
|
1,863
|
||||||||||||||
Depreciation
and amortization
|
707
|
1,049
|
1,273
|
1,566
|
1,748
|
||||||||||||||
Total
expenses
|
23,932
|
34,180
|
39,068
|
52,343
|
81,013
|
||||||||||||||
Operating
loss
|
(15,049
|
)
|
(24,095
|
)
|
(31,607
|
)
|
(42,767
|
)
|
(71,527
|
)
|
|||||||||
Other
income (expense):
|
|||||||||||||||||||
Interest
income
|
3,348
|
1,708
|
625
|
780
|
2,299
|
||||||||||||||
Interest
expense
|
(49
|
)
|
(2
|
)
|
(4
|
)
|
|||||||||||||
Payment
from collaborator
|
9,852
|
||||||||||||||||||
Loss
on sale of marketable securities
|
(31
|
)
|
|||||||||||||||||
Payment
from insurance settlement
|
1,600
|
||||||||||||||||||
Total
other income
|
13,151
|
3,306
|
621
|
749
|
2,299
|
||||||||||||||
Net
loss before income taxes
|
(1,898
|
)
|
(20,789
|
)
|
(30,986
|
)
|
(42,018
|
)
|
(69,228
|
)
|
|||||||||
Income
taxes
|
(201
|
)
|
|||||||||||||||||
Net
loss
|
$
|
(1,898
|
)
|
$
|
(20,789
|
)
|
$
|
(30,986
|
)
|
$
|
(42,018
|
)
|
$
|
(69,429
|
)
|
||||
Per
share amounts on net loss:
|
|||||||||||||||||||
Basic
and diluted
|
$
|
(0.15
|
)
|
$
|
(1.66
|
)
|
$
|
(2.32
|
)
|
$
|
(2.48
|
)
|
$
|
(3.33
|
)
|
December
31,
|
||||||||||||||||
2001
|
2002
|
2003
|
2004
|
2005
|
||||||||||||
(in
thousands)
|
||||||||||||||||
Balance
Sheet Data:
|
||||||||||||||||
Cash,
cash equivalents and
marketable
securities
|
$
|
61,877
|
$
|
42,374
|
$
|
65,663
|
$
|
31,207
|
$
|
173,090
|
||||||
Working
capital
|
40,650
|
36,209
|
56,228
|
25,667
|
137,101
|
|||||||||||
Total
assets
|
67,481
|
48,118
|
72,886
|
39,545
|
184,003
|
|||||||||||
Deferred
lease liability
|
39
|
71
|
50
|
42
|
49
|
|||||||||||
Total
stockholders’ equity
|
64,345
|
45,147
|
67,683
|
31,838
|
112,732
|
Year
Ended
December
31,
|
|||||
Category
|
2004
|
2005
|
Dollar
Variance
|
Percentage
Variance
|
Explanation
|
Salaries
and benefits
|
$12,193
|
$14,009
|
$
1,816
|
15
%
|
Company-wide
compensation increases and an increase in average headcount from
111 to
117 for the years ended December 31, 2004 and 2005, respectively,
in the
research and development, manufacturing and clinical departments,
including the hiring of our Vice President, Quality in July
2005.
|
Clinical
trial costs
|
8,675
|
10,493
|
1,818
|
21
|
Increase
primarily related to MNTX ($905) due to a higher level of activity
in the
301 and 302 trials and their extension studies in the 2005 period
than in
the 301 trial in the 2004 period. Also, increases in GMK ($765),
due to
increased enrollment in the 2005 period, and HIV ($148), resulting
from an
increase in the PRO 140 phase 1 and phase 1b trial activity in
the 2005
period.
|
Laboratory
supplies
|
3,762
|
5,292
|
1,530
|
41
|
Increases
in MNTX ($916) due to increased costs of manufacturing MNTX for
clinical
trials, HIV ($446) due to preparation of materials for the phases
1 and 1b
PRO 140 clinical trials and an increase in basic research in 2005
and GMK
($218) related to manufacturing materials for the ongoing phase
3 clinical
trial, partially offset by a decrease in other projects ($50),
as research
and development activity focused on clinical trials in the areas
of MNTX
and HIV rather than on other areas of basic research.
|
Contract
manufacturing and subcontractors
|
5,371
|
5,836
|
465
|
9
|
Increase
in MNTX ($161) and HIV ($609), partially offset by decreases in
GMK ($14)
and other projects ($291). These expenses are related to the conduct
of
clinical trials, including testing, analysis, formulation and toxicology
services and vary as the timing and level of such services are
required.
|
Consultants
|
1,646
|
3,609
|
1,963
|
119
|
Increases
in MNTX ($1,845) and HIV ($210) and other projects ($35), partially
offset
by a decrease in GMK ($127). These expenses are related to monitoring
and
conduct of clinical trials, including analysis of data from completed
clinical trials and vary as the timing and level of such services
are
required.
|
License
fees
|
390
|
20,418
|
20,028
|
5,135
|
Increase
primarily related to payments to UR Labs and the Goldberg Distributees
(see “Overview
¾
Purchase of Rights from MNTX Licensors”), licensors
of
MNTX ($19,205) and related to our HIV program ($823).
|
Operating
expenses
|
4,026
|
4,180
|
154
|
4
|
Increase
primarily due to an increase in rent, utility and facilities expenses
($354), partially offset by a decrease in other operating expenses
and
travel ($200) in 2005.
|
Total
|
$
36,063
|
$
63,837
|
$
27,774
|
77 %
|
Year
Ended
December
31,
|
|||||
Category
|
2004
|
2005
|
Dollar
Variance
|
Percentage
Variance
|
Explanation
|
Salaries
and benefits
|
$4,057
|
$
5,895
|
$1,838
|
45
%
|
Increase
due to compensation increases, including bonuses. For the years
ended
December 31, 2004 and 2005, respectively, average headcount remained
stable, although we hired our General Counsel in June 2005 and
one senior
executive departed in April 2005.
|
Consulting
and professional fees
|
5,336
|
4,488
|
(848)
|
(16)
|
Decrease
due primarily to a decrease in recruiting ($88) and audit fees,
including
fees for internal control readiness and the auditing of internal
controls
over financial reporting ($1,332), partially offset by increases
in
consultants ($560) and legal and patent fees ($25).
|
Operating
expenses
|
2,860
|
2,789
|
(71)
|
(2)
|
Decrease
in insurance ($13) and other operating expenses ($124), partially
offset
by an increase in rent, utilities and facilities costs
($66).
|
Other
|
327
|
393
|
66
|
20
|
Increased
investor relations ($109) and conference ($40) costs, partially
offset by
a decrease in corporate sales and franchise taxes
($83).
|
Total
|
$12,580
|
$
13,565
|
$
985
|
8
%
|
Year
Ended
December
31,
|
|||||
Category
|
2003
|
2004
|
Dollar
Variance
|
Percentage
Variance
|
Explanation
|
Salaries
and benefits
|
$8,767
|
$
12,193
|
$
3,426
|
39%
|
Company-wide
compensation increases and an increase in average headcount from
90 to 111
for the years ended December 31, 2003 and December 31, 2004, respectively,
in the research and development, manufacturing and medical
departments.
|
Clinical
trial costs
|
4,194
|
8,675
|
4,481
|
107
|
Increase
due to MNTX ($4,447) as phase 3 trials expanded and GMK ($64) due
to
increased patient enrollment, partially offset by decreases in
HIV ($25)
and other programs ($5).
|
Laboratory
supplies
|
2,665
|
3,762
|
1,097
|
41
|
Increase
in MNTX ($527), HIV ($149), GMK ($96) and other programs ($325)
due to
preparation of materials for clinical trials and an increase in
basic
research.
|
Contract
manufacturing and subcontractors
|
7,314
|
5,371
|
(1,943)
|
(27)
|
Decrease
due to decline in MNTX ($976) and HIV ($1,232), partially offset
by an
increase in and GMK ($31) and other programs ($234).These expenses
are
related to the conduct of clinical trials, including testing, analysis,
formulation and toxicology services and vary as the timing and
level of
such services are required.
|
Consultants
|
895
|
1,646
|
751
|
84
|
Increase
due to MNTX ($884) and GMK ($134), partially offset by decreases
in HIV
($38) and other programs ($229). These expenses are related to
monitoring
and conduct of clinical trials, including analysis of data from
completed
clinical trials and vary as the timing and level of such services
are
required.
|
License
fees
|
867
|
390
|
(477)
|
(55)
|
Decrease
related to lower payments to licensors in our GMK ($102), MNTX
($50) and
other ($500) programs. In addition, there was an increase in our
payments
related to our HIV ($175) program.
|
Operating
expenses
|
2,539
|
4,026
|
1,487
|
59
|
Increase
primarily due to increased rent and facility ($1,145) and other
($342)
costs in 2004 over those in 2003.
|
Total
|
$27,241
|
$36,063
|
$
8,822
|
32%
|
· |
$15,839,000
related to the purchase of rights from our licensors of MNTX in
exchange
for our common stock (See “Overview - Purchase of Rights from Licensors of
MNTX”); and
|
· |
$1,681,000
of non-cash amortization of unearned compensation resulting from
the
issuance to employees of restricted stock during 2004 and 2005
and from
the issuance of compensatory stock options to executive officers
and
non-employees;
|
· |
increased
by $278,000 resulting from a decrease in loss in joint venture,
as
reported after adjustment, of $271,000, which was offset by an
increase of
$549,000 due to the adjustment to loss in joint venture. As described
above, we reduce our revenue from the joint venture and our loss
in the
joint venture by the amount we receive from PSMA-related grant
funding up
to a cap of $3.0 million. The increase of $278,000 in loss in joint
venture before the adjustment resulted from decreased research
and
development costs in 2005, which were more than offset by a $2.0
million
license payment that was paid in 2005. We account for PSMA LLC
by using
the equity method and record 50% of PSMA LLC’s net loss as our loss in
joint venture.
|
· |
decreased
by $2,000,000 due to additional capital contributions to PSMA LLC
upon
approval of a work plan and a budget by the Members, in June 2005,
for the
year ended December 31, 2005. The 2005 work plan and budget required
greater capital contributions during 2005 than did the corresponding
2004
work plan and budget;
|
· |
decreased
by $1,854,000 from an increase in trade accounts receivable, mostly
for
reimbursement of our fourth quarter 2005 expenses under our grants
and
contract with the NIH; and
|
· |
increased
by $728,000 due to an increase in accounts payable and accrued
expenses,
as the pace of our research and development activities, especially
for
MNTX, increased in 2005 over that in
2004.
|
For
the Year Ended December 31,
|
||||||||||
2003
|
2004
|
2005
|
||||||||
(in
millions)
|
||||||||||
MNTX
|
$
|
11.7
|
$
|
19.7
|
$
|
43.8
|
||||
HIV
|
7.5
|
8.3
|
11.7
|
|||||||
Cancer
|
4.5
|
5.9
|
6.6
|
|||||||
Other
programs
|
3.5
|
2.2
|
1.7
|
|||||||
Total
|
$
|
27.2
|
$
|
36.1
|
$
|
63.8
|
Payments
due by December 31,
|
||||||||||||||||
Total
|
2006
|
2007-2008
|
2009-2010
|
Thereafter
|
||||||||||||
(
in millions)
|
||||||||||||||||
Operating
leases
|
$
|
4.7
|
$
|
1.7
|
$
|
2.1
|
$
|
0.9
|
$ | |||||||
License
and collaboration agreements (1)
|
14.4
|
1.4
|
2.1
|
1.9
|
9.0
|
|||||||||||
Funding
commitment to PSMA LLC (2)
|
0.7
|
0.7
|
||||||||||||||
Purchase
commitment
|
0.8
|
0.8
|
||||||||||||||
Total
|
$
|
20.6
|
$
|
4.6
|
$
|
4.2
|
$
|
2.8
|
$
|
9.0
|
(1) |
Assumes
attainment of milestones covered under each agreement. The timing
of the
achievement of the related milestones is highly uncertain, and
accordingly
the actual timing of payments, if any, is likely to vary, perhaps
significantly, relative to the timing contemplated by this
table.
|
(2) |
The
Members have not agreed on a work plan or budget for PSMA LLC for
2006.
However, the Members are required to fulfill obligations under
existing
contractual commitments as of December 31,
2005.
|
Name
|
Age
|
Position
|
Kurt
W. Briner (1)(2)
|
61
|
Co-Chairman
|
Paul
F. Jacobson (1)(2)(3)
|
51
|
Co-Chairman
|
Paul
J. Maddon, M.D., Ph.D.
|
46
|
Chief
Executive Officer, Chief Science Officer and Director
|
Charles
A. Baker (1)(2)(3)
|
73
|
Director
|
Mark
F. Dalton (2)(3)
|
55
|
Director
|
Stephen
P. Goff, Ph.D.(2)
|
54
|
Director
|
David
A. Scheinberg, M.D., Ph.D.
|
50
|
Director
|
Robert
A. McKinney, CPA
|
49
|
Chief
Financial Officer, Senior Vice President, Finance & Operations and
Treasurer
|
Mark
R. Baker, J.D.
|
51
|
Senior
Vice President & General Counsel and Secretary
|
Thomas
A. Boyd, Ph.D.
|
54
|
Senior
Vice President, Product Development
|
Robert
J. Israel, M.D.
|
49
|
Senior
Vice President, Medical Affairs
|
Lynn
M. Bodarky, M.B.A.
|
40
|
Vice
President, Business Development & Licensing
|
Richard
W. Krawiec, Ph.D.
|
58
|
Vice
President, Corporate Affairs
|
Alton
B. Kremer, M.D., Ph.D.
|
53
|
Vice
President, Clinical Research
|
William
C. Olson, Ph.D.
|
43
|
Vice
President, Research & Development
|
Benedict
Osorio, M.B.A.
|
49
|
Vice
President, Quality
|
Nitya
G. Ray, Ph.D.
|
53
|
Vice
President, Manufacturing
|
Annual
Compensation(1)
|
Long
Term Compensation
|
||||||||||||||||||
Name
and Principal Position
|
Fiscal
Year
|
Salary
|
Bonus
|
Restricted
Stock
Awards(2)
|
Stock
Option
Grants
|
Other
Compensation(3)
|
|||||||||||||
Paul
J. Maddon, M.D., Ph.D.
|
2005
|
$
|
536,785
|
$
|
—
(7
|
)
|
$
|
934,250
|
75,000
shares
|
$
|
16,000
|
||||||||
Chief
Executive Officer and
|
2004
|
515,000
|
150,000
|
—
|
75,000
shares
|
14,729
|
|||||||||||||
Chief
Science Officer
|
2003
|
499,859
|
175,000
|
—
|
225,000shares
|
13,729
|
|||||||||||||
Alton
B. Kremer, M.D., Ph.D. (6)
|
2005
|
$
|
320,000
|
$
|
153,000
|
$
|
74,865
|
10,000
shares
|
$
|
19,484
|
|||||||||
Vice
President, Clinical Research
|
2004
|
83,692
|
83,000
|
—
|
40,000
shares
|
—
|
|||||||||||||
Robert
J. Israel, M.D.
|
2005
|
$
|
312,000
|
$
|
125,000
|
$
|
74,865
|
10,000
shares
|
$
|
19,596
|
|||||||||
Senior
Vice President, Medical
|
2004
|
300,000
|
50,000
|
126,375
|
—
|
44,069
(4
|
)
|
||||||||||||
Affairs
|
2003
|
278,000
|
25,000
|
—
|
35,000
shares
|
45,694
(4
|
)
|
||||||||||||
Mark
R. Baker, J.D., Senior Vice
|
2005
|
$
|
149,692
|
$
|
249,000
|
$
|
—
|
50,000
shares
|
$
|
7,500
|
|||||||||
President
& General Counsel (5)
|
|||||||||||||||||||
Robert
A. McKinney, CPA
|
2005
|
$
|
230,000
|
$
|
150,000
|
$
|
96,255
|
37,500
shares
|
$
|
18,387
|
|||||||||
Chief
Financial Officer,
|
2004
|
200,000
|
60,000
|
126,375
|
—
|
19,861
|
|||||||||||||
Senior
Vice President, Finance &
|
2003
|
174,000
|
50,000
|
—
|
25,000
shares
|
19,194
|
|||||||||||||
Operations
and Treasurer
|
Name
|
Number
of
Shares
Underlying
Options
Granted
|
Percent
of
Total
Option
Shares
Granted
to
Employees(1)
|
Exercise
Price
per
Share
|
Expiration
Date
|
Potential
Realizable Value at Assumed Annual Rates of Stock Price Appreciation
for
Option Term
|
|
5%
|
10%
|
|||||
Paul
J. Maddon, M.D., Ph.D.
|
75,000
|
10.7%
|
$21.39
|
7/1/2015
|
$1,008,904
|
$2,556,761
|
Alton
B. Kremer, M.D., Ph.D.
|
10,000
|
1.4%
|
$21.39
|
7/1/2015
|
$134,521
|
$340,902
|
Robert
J. Israel, M.D.
|
10,000
|
1.4%
|
$21.39
|
7/1/2015
|
$134,521
|
$340,902
|
Mark
R. Baker, J.D.
|
50,000
|
7.1%
|
$20.02
|
6/20/2015
|
$629,524
|
$1,595,336
|
Robert
A. McKinney, CPA
|
25,000
|
3.6%
|
$22.68
|
3/1/2015
|
$356,583
|
$903,652
|
Robert
A. McKinney, CPA
|
12,500
|
1.8%
|
$21.39
|
7/1/2015
|
$168,151
|
$426,127
|
Exercises
During
the
Fiscal Year
|
Number
of
Shares
Underlying
Unexercised
Options
|
Value
of Unexercised
In-the-Money
Options (1)
|
|||||||||||||||||
Name
|
Acquired
|
Realized
(2)
|
Exercisable
|
Unexercisable
|
Exercisable
|
Unexercisable
|
|||||||||||||
Paul
J. Maddon, M.D., Ph.D.
|
—
|
$
|
—
|
1,291,650
|
166,125
|
$
|
18,908,078
|
$
|
1,436,498
|
||||||||||
Alton
B. Kremer, M.D., Ph.D.
|
—
|
$
|
—
|
8,000
|
42,000
|
$
|
91,520
|
$
|
402,280
|
||||||||||
Robert
J. Israel, M.D.
|
8,750
|
$
|
160,846
|
193,750
|
36,250
|
$
|
2,845,400
|
$
|
321,625
|
||||||||||
Mark
R. Baker, J.D.
|
—
|
$
|
—
|
—
|
50,000
|
$
|
—
|
$
|
249,500
|
||||||||||
Robert
A. McKinney, CPA
|
15,000
|
$
|
293,100
|
146,250
|
56,250
|
$
|
1,964,900
|
$
|
307,375
|
· |
$2,000
for each meeting of the Board of Directors attended in person,
$1,000 for
each in-person meeting attended by telephone and $500 for participation
in
each telephonic meeting;
|
· |
for
committee meetings held other than in conjunction with a meeting
of the
entire Board, $1,000 for attendance in person and $500 for telephonic
participation;
|
· |
for
committee meetings held on the day after a meeting of the entire
Board,
$500 for participation;
|
· |
for
committee meetings held on the same day, no additional compensation
is
paid;
|
· |
an
annual retainer fee of $15,000, except for Messrs. Briner and Jacobson
who
are entitled to an annual retainer fee of $40,000 as described
above;
and
|
· |
an
option to purchase 10,000 shares of our common stock granted annually
on
each July 1 with an exercise price equal to the fair market value
as of
the date of grant, provided that with regard to the option grant
on July
1, 2005, Messrs. Briner and Jacobson will not be entitled to the
annual
option grant.
|
By
the Compensation Committee of the Board of Directors
|
|
Mark
F. Dalton, Chairman
|
|
Charles
A. Baker
|
|
Paul
F. Jacobson
|
Shares
Beneficially
Owned
(2)
|
||
Name
and Address of Beneficial Owner(1)
|
Number
|
Percent
|
Entities
affiliated with Tudor Investment Corporation (3)
|
2,342,388
|
9.2%
|
1275
King Street
|
||
Greenwich,
CT 06831
|
||
Paul
Tudor Jones, II (4)
|
2,888,513
|
11.4%
|
1275
King Street
|
||
Greenwich,
CT 06831
|
||
Delaware
Management Holdings (5)
|
1,565,995
|
6.2%
|
One
Commerce Square, 2005 Market Street
|
||
Philadelphia,
PA 19103
|
||
Entities
affiliated with Philip B. Korsant (6)
|
1,770,000
|
7.0%
|
Ziff
Asset Management, L.P.
|
||
c/o
Philip B. Korsant
|
||
283
Greenwich Avenue
|
||
Greenwich,
CT 06830
|
||
Federated
Investors, Inc. (7)
|
1,331,100
|
5.2%
|
Federated
Investors Tower
|
||
Pittsburgh,
PA 15222
|
||
Sectoral
Asset Management Inc. (8)
|
1,651,434
|
6.5%
|
1000
Sherbrooke Street
|
||
Montreal,
A1 00000
|
||
Paul
J. Maddon, M.D., Ph.D. (9)
|
1,848,265
|
6.9%
|
Charles
A. Baker (10)
|
86,481
|
*
|
Kurt
W. Briner (11)
|
143,000
|
*
|
Mark
F. Dalton (12)
|
2,494,888
|
9.8%
|
Stephen
P. Goff, Ph.D. (13)
|
131,000
|
*
|
Paul
F. Jacobson (14)
|
278,100
|
1.1%
|
David
A. Scheinberg, M.D., Ph.D. (15)
|
175,931
|
*
|
Robert
J. Israel, M.D. (16)
|
194,377
|
*
|
Robert
A. McKinney, CPA (17)
|
169,669
|
*
|
Alton
B. Kremer, M.D., Ph.D. (18)
|
6,967
|
*
|
Mark
R. Baker, J.D. (19)
|
2,316
|
*
|
All
directors and executive officers as a group (20)
|
6,007,570
|
21.4%
|
*
|
Less
than one percent.
|
(1)
|
Unless
otherwise specified, the address of each beneficial owner is c/o
Progenics
Pharmaceuticals, Inc., 777 Old Saw Mill River Road, Tarrytown,
New York
10591.
|
(2)
|
Except
as indicated and pursuant to applicable community property laws,
each
stockholder possesses sole voting and investment power with respect
to the
shares of common stock listed. The number of shares of common stock
beneficially owned includes the shares issuable pursuant to stock
options
to the extent indicated in the footnotes in this table. Shares
issuable
upon exercise of these options are deemed outstanding for computing
the
percentage of beneficial ownership of the person holding the options
but
are not deemed outstanding for computing the percentage of beneficial
ownership of any other person.
|
(3)
|
The
number of shares owned by entities affiliated with Tudor Investment
Corporation (TIC) consists of 1,820,068 shares held of record by
The Tudor
BVI Portfolio Ltd., a company organized under the law of the Cayman
Islands (Tudor BVI), 287,813 shares held of record by TIC, 193,126
shares
held of record by Tudor Arbitrage Partners L.P. (TAP), 25,981 shares
held
of record by Tudor Proprietary Trading, L.L.C. (TPT), and 15,400
shares
held of record by Tudor Global Trading LLC (TGT). In addition,
because TIC
provides investment advisory services to Tudor BVI, it may be deemed
to
beneficially own the shares held by such entity. TIC disclaims
beneficial
ownership of such shares. TGT is the general partner of TAP. Tudor
Group
Holdings LLC (TGH) is the sole member of TGT and indirectly holds
all of
the membership interests of TPT. TGH is also the sole limited partner
of
TAP. TGH expressly disclaims beneficial ownership of the shares
beneficially owned by each of such entities. TGT disclaims beneficial
ownership of shares held by TAP. The number set forth does not
include
shares owned of record by Mr. Jones and Mr. Dalton. See Notes (4) and
(12).
|
(4)
|
Includes
2,342,388 shares beneficially owned by entities affiliated with
TIC.
Mr. Jones is the Chairman and indirect principal equity owner of TIC,
TPT and TGT, and the indirect principal equity owner of TAP. Mr.
Jones may
be deemed to be the beneficial owner of shares beneficially owned,
or
deemed beneficially owned, by entities affiliated with TIC. Mr. Jones
disclaims beneficial ownership of such shares. See
Note (3).
|
(5)
|
Based
on a Schedule 13G filed on February 9, 2006, the number of shares
owned by
Delaware Management Holdings and Delaware Management Business Trust
consists of 1,565,995 shares held by Delaware Management Holdings
and
Delaware Management Business Trust, which share voting and dispositive
powers.
|
(6)
|
Based
on a Schedule 13G, filed on February 13, 2006, the number of shares
owned
by entities affiliated with Philip B. Korsant consists of 1,770,000
shares
held by Ziff Asset Management, L.P., a Delaware limited partnership.
Mr. Korsant, ZBI Equities, L.L.C. and PBK Holdings, Inc., a Delaware
corporation, share voting and dispositive power over the shares
held by
Ziff Asset Management, L.P.
|
(7)
|
Based
on a Schedule 13G, filed February 14, 2006, Federated Investors,
Inc. (the
“Parent”) is the parent holding company of Federated Equity Management
Company of Pennsylvania and Federated Global Investment Management
Corp.
All of the Parent’s outstanding voting stock is held in the Voting Shares
Irrevocable Trust for which John F. Donahue, Rhodora J. Donahue
and J.
Christopher Donahue act as trustees and they have the collective
voting
control over the Parent.
|
(8)
|
Sectoral
Asset Management Inc. in its capacity as an investment adviser,
has the
sole right to vote or dispose of the 1,651,434 shares set forth
in
Schedule 13G filed on February 14, 2006. Jerome G. Pfund and Michael
L.
Sjostrom are the sole shareholders of Sectoral Asset Management
Inc.
|
(9)
|
Includes
541,865 shares outstanding; 1,261,650 shares issuable upon exercise
of
options exercisable within 60 days of March 1, 2006 and 43,750
shares of
restricted stock. Also includes 1,000 shares held by Dr. Maddon’s spouse,
the beneficial ownership of which Dr. Maddon disclaims. Excludes
88,229
shares held by a trust, of which his spouse is the beneficiary;
neither
Dr. Maddon nor his spouse has investment control over such
trust.
|
(10)
|
Includes
21,481 shares owned by the Baker Family Limited Partnership and
65,000
shares issuable upon exercise of options held by Mr. Baker and
exercisable
within 60 days of March 1, 2006.
|
(11)
|
Includes
3,000 shares outstanding and140,000 shares issuable upon exercise
of
options held by Mr. Briner exercisable within 60 days of March 1,
2006.
|
(12)
|
Includes
71,000 shares held of record directly by Mr. Dalton, 65,000 shares
issuable upon exercise of options held by Mr. Dalton exercisable
within 60 days of March 1, 2006 and 16,500 shares held of record
by DF
Partners, a family partnership of which Mr. Dalton is the sole
general partner. The number set forth also includes 2,342,388 shares
beneficially owned by entities affiliated with TIC. Mr. Dalton
is
President and an equity owner of TIC and TGH. Mr. Dalton is also
the
President and an indirect equity owner of TGT and TPT. Mr. Dalton
disclaims beneficial ownership of shares beneficially owned, or
deemed
beneficially owned, by entities affiliated with TIC and DF Partners,
except to the extent of his pecuniary interest therein. See Note
(3).
|
(13)
|
Includes
33,500 shares outstanding and 97,500 shares issuable upon exercise
of
options held by Dr. Goff exercisable within 60 days of March 1,
2006.
|
(14)
|
Includes
188,100 shares outstanding and 90,000 shares issuable upon exercise
of
options held by Mr. Jacobson exercisable within 60 days of March 1,
2006.
|
(15)
|
Includes
24,181 shares outstanding and 151,750 shares issuable upon exercise
of
options held by Dr. Scheinberg exercisable within 60 days of March
1,
2006.
|
(16)
|
Includes
11,502 shares outstanding and 173,750 shares issuable upon exercise
of
options held by Dr. Israel exercisable within 60 days of March 1,
2006. Also includes 9,125 shares of restricted
stock.
|
(17)
|
Includes
7,044 shares outstanding and 152,500 shares issuable upon exercise
of
options held by Mr. McKinney exercisable within 60 days of March 1,
2006. Also includes 10,125 shares of restricted
stock.
|
(18)
|
Includes
3,467 shares outstanding and no shares issuable upon exercise of
options
held by Dr. Kremer exercisable within 60 days of March 1, 2006. Also
includes 3,500 shares of restricted
stock.
|
(19)
|
Includes
2,316 shares outstanding and no shares issuable upon exercise of
options
held by Mr. Baker exercisable within 60 days of March 1,
2006.
|
(20)
|
Includes
3,295,820 shares outstanding, 111,500 shares of restricted stock
and
2,600,250 shares issuable upon the exercise of stock options exercisable
within 60 days of March 1, 2006 held by affiliated entities, directors
and
named executive officers as set forth in the above table and by
all other
executive officers.
|
Plan
category
|
(a)
Number
of shares
to
be issued upon
exercise
of
outstanding
options,
warrants
and rights
|
(b)
Weighted
average
exercise
price of
outstanding
options,
warrants
and rights
|
(c)
Number
of shares
remaining
available
for
future issuance
(excluding
securities
reflected
in 1st column)
|
|||||||
Equity
compensation plans approved by shareholders:
|
3,953,186
(1
|
)
|
$
|
15.07
|
2,037,621
(2
|
)
|
||||
Equity
compensation plans not approved by shareholders (3):
|
620,192
|
$
|
4.50
|
¾
|
||||||
Total
|
4,573,378
|
$
|
13.64
|
2,037,621
|
Fees
of Auditors
|
|||||||
Type
of Fee
|
2005
|
2004
|
|||||
Audit
Fees (1)
|
$
|
753,350
|
$
|
899,395
|
|||
Audit
Related Fees (2)
|
64,000
|
49,000
|
|||||
Tax
Fees(3)
|
41,300
|
20,900
|
|||||
All
Other Fees(4)
|
1,611
|
1,613
|
1.
|
Consolidated
Financial Statements of Progenics Pharmaceuticals,
Inc.
|
Page
|
|
F-2
|
|
Financial
Statements:
|
|
F-3
|
|
F-4
|
|
F-5
|
|
F-6
|
|
F-7
|
/s/
PricewaterhouseCoopers LLP
|
|
New
York, New York
|
|
March 15,
2006
|
December
31,
|
|||||||
2004
|
2005
|
||||||
A
ssets
|
|||||||
Current
assets:
|
|||||||
Cash
and cash equivalents
|
$
|
5,227
|
$
|
67,072
|
|||
Marketable
securities
|
24,994
|
98,983
|
|||||
Accounts
and unbilled receivables
|
1,112
|
3,287
|
|||||
Amount
due from joint venture
|
189
|
||||||
Other
current assets
|
1,810
|
2,561
|
|||||
Total
current assets
|
33,332
|
171,903
|
|||||
Marketable
securities
|
986
|
7,035
|
|||||
Fixed
assets, at cost, net of accumulated depreciation and
amortization
|
4,692
|
4,156
|
|||||
Investment
in joint venture
|
371
|
||||||
Restricted
cash
|
535
|
538
|
|||||
Total
assets
|
$
|
39,545
|
$
|
184,003
|
|||
L
iabilities
and
S
tockholders
’
E
quity
|
|||||||
Current
liabilities:
|
|||||||
Accounts
payable and accrued expenses
|
$
|
7,260
|
$
|
10,238
|
|||
Deferred
revenue
¾
current
|
23,580
|
||||||
Due
to joint venture
|
194
|
||||||
Income
taxes payable
|
201
|
||||||
Investment
deficiency in joint venture
|
405
|
||||||
Other
current liabilities
|
589
|
||||||
Total
current liabilities
|
7,665
|
34,802
|
|||||
Deferred
revenue —long term
|
36,420
|
||||||
Deferred
lease liability
|
42
|
49
|
|||||
Total
liabilities
|
7,707
|
71,271
|
|||||
Commitments
and contingencies (Note 9)
|
|||||||
Stockholders’
equity:
|
|||||||
Preferred
stock, $.001 par value; 20,000,000 shares authorized; issued, and
outstanding—none
|
|||||||
Common
stock, $.0013 par value; 40,000,000 shares authorized; issued and
outstanding— 17,280,635 in 2004 and 25,229,240 in 2005
|
22
|
33
|
|||||
Additional
paid-in capital
|
153,469
|
306,085
|
|||||
Unearned
compensation
|
(2,251
|
)
|
(4,498
|
)
|
|||
Accumulated
deficit
|
(119,311
|
)
|
(188,740
|
)
|
|||
Accumulated
other comprehensive (loss)
|
(91
|
)
|
(148
|
)
|
|||
Total
stockholders’ equity
|
31,838
|
112,732
|
|||||
Total
liabilities and stockholders’ equity
|
$
|
39,545
|
$
|
184,003
|
Years
Ended December 31,
|
||||||||||
2003
|
2004
|
2005
|
||||||||
Revenues:
|
||||||||||
Contract
research and development from joint venture
|
$
|
2,486
|
$
|
2,008
|
$
|
988
|
||||
Research
grants and contracts
|
4,826
|
7,483
|
8,432
|
|||||||
Product
sales
|
149
|
85
|
66
|
|||||||
Total
revenues
|
7,461
|
9,576
|
9,486
|
|||||||
Expenses:
|
||||||||||
Research
and development
|
26,374
|
35,673
|
43,419
|
|||||||
License
fees- research and development
|
867
|
390
|
20,418
|
|||||||
General
and administrative
|
8,029
|
12,580
|
13,565
|
|||||||
Loss
in joint venture
|
2,525
|
2,134
|
1,863
|
|||||||
Depreciation
and amortization
|
1,273
|
1,566
|
1,748
|
|||||||
Total
expenses
|
39,068
|
52,343
|
81,013
|
|||||||
Operating
loss
|
(31,607
|
)
|
(42,767
|
)
|
(71,527
|
)
|
||||
Other
income (expense):
|
||||||||||
Interest
income
|
621
|
780
|
2,299
|
|||||||
Loss
on sale of marketable securities
|
(31
|
)
|
||||||||
Total
other income
|
621
|
749
|
2,299
|
|||||||
Net
loss before income taxes
|
(30,986
|
)
|
(42,018
|
)
|
(69,228
|
)
|
||||
Income
taxes
|
(201
|
)
|
||||||||
Net
loss
|
$
|
(30,986
|
)
|
$
|
(42,018
|
)
|
$
|
(69,429
|
)
|
|
Net
loss per share—basic and diluted
|
$
|
(2.32
|
)
|
$
|
(2.48
|
)
|
$
|
(3.33
|
)
|
|
Weighted-average
shares—basic and diluted
|
13,367
|
16,911
|
20,864
|
Common
Stock
|
Additional
Paid-in
|
Unearned
|
Accumulated
|
Accumulated
Other Comprehensive
|
Comprehensive
|
||||||||||||||||||||
Shares
|
Amount
|
Capital
|
Compensation
|
Deficit
|
Income
(
Loss
)
|
Total
|
(
Loss
)
|
||||||||||||||||||
Balance
at December 31, 2002
|
12,682
|
$
|
17
|
$
|
91,332
|
$
|
(46,307
|
)
|
$
|
106
|
$
|
45,148
|
$
|
(20,
890
|
)
|
||||||||||
Issuance
of compensatory stock options
|
326
|
326
|
|||||||||||||||||||||||
Sale
of common stock under employee stock purchase plans and exercise
of stock
options
|
627
|
1
|
3,515
|
3,516
|
|||||||||||||||||||||
Sale
of common stock in a public offering, net of expenses of
$4,382
|
3,332
|
4
|
49,767
|
49,771
|
|||||||||||||||||||||
Net
loss for the year ended December 31, 2003
|
(30,986
|
)
|
(30,986
|
)
|
(30,986
|
)
|
|||||||||||||||||||
Change
in unrealized gain on marketable securities
|
(92
|
)
|
(92
|
)
|
(92
|
)
|
|||||||||||||||||||
Balance
at December 31, 2003
|
16,641
|
22
|
144,940
|
(77,293
|
)
|
14
|
67,683
|
(31,078
|
)
|
||||||||||||||||
Issuance
of restricted stock, net of forfeited shares
|
161
|
2,703
|
$
|
(2,703
|
)
|
||||||||||||||||||||
Amortization
of unearned compensation - employees
|
452
|
452
|
|||||||||||||||||||||||
Issuance
of compensatory stock options - non-employees
|
385
|
385
|
|||||||||||||||||||||||
Sale
of common stock under employee stock purchase plans and exercise
of stock
options
|
479
|
5,441
|
5,441
|
||||||||||||||||||||||
Net
loss for the year ended December 31, 2004
|
(42,018
|
)
|
(42,018
|
)
|
(42,018
|
)
|
|||||||||||||||||||
Change
in unrealized gain on marketable securities
|
(105
|
)
|
(105
|
)
|
(105
|
)
|
|||||||||||||||||||
Balance
at December 31, 2004
|
17,281
|
22
|
153,469
|
(2,251
|
)
|
(119,311
|
)
|
(91
|
)
|
31,838
|
(42,123
|
)
|
|||||||||||||
Issuance
of restricted stock, net of forfeited shares, and compensatory
stock
options to employees
|
134
|
4,125
|
(4,125
|
)
|
|||||||||||||||||||||
Amortization
of unearned compensation - employees
|
1,878
|
1,878
|
|||||||||||||||||||||||
Issuance
of compensatory stock options to non-employees
|
640
|
640
|
|||||||||||||||||||||||
Sale
of common stock under employee stock purchase plans and exercise
of stock
options
|
821
|
1
|
10,467
|
10,468
|
|||||||||||||||||||||
Sale
of common stock in public offerings, net of offering expenses of
$4,768
|
6,307
|
9
|
121,546
|
121,555
|
|||||||||||||||||||||
Issuance
of common stock for license rights (see Note 8)
|
686
|
1
|
15,838
|
15,839
|
|||||||||||||||||||||
Net
loss for the year ended December 31, 2005
|
(69,429
|
)
|
(69,429
|
)
|
(69,429
|
)
|
|||||||||||||||||||
Change
in unrealized gain on marketable securities
|
(57
|
)
|
(57
|
)
|
(57
|
)
|
|||||||||||||||||||
Balance
at December 31, 2005
|
25,229
|
$
|
33
|
$
|
306,085
|
$
|
(4,498
|
)
|
$
|
(188,740
|
)
|
$
|
(148
|
)
|
$
|
112,732
|
$
|
(69,486
|
)
|
Years
Ended December 31,
|
||||||||||
2003
|
2004
|
2005
|
||||||||
Cash
flows from operating activities:
|
||||||||||
Net
loss
|
$
|
(30,986
|
)
|
$
|
(42,018
|
)
|
$
|
(69,429
|
)
|
|
Adjustments
to reconcile net loss to net cash (used in) operating
activities:
|
||||||||||
Depreciation
and amortization
|
1,273
|
1,566
|
1,748
|
|||||||
Write-off
of fixed assets
|
42
|
|||||||||
Loss
on sale of marketable securities
|
31
|
|||||||||
Amortization
of premiums/accretion of discounts, net on marketable
securities
|
644
|
640
|
270
|
|||||||
Amortization
of unearned compensation
|
452
|
1,878
|
||||||||
Loss
in Joint Venture
|
2,525
|
2,134
|
1,863
|
|||||||
Adjustment
to loss in joint venture (See Note 10)
|
927
|
762
|
1,311
|
|||||||
Non-cash
expense incurred in connection with issuance of compensatory stock
options
to non-employees
|
326
|
385
|
640
|
|||||||
Purchase
of license rights for common stock (see Note 8)
|
15,839
|
|||||||||
Changes
in assets and liabilities:
|
||||||||||
Increase
in accounts receivable
|
(463
|
)
|
(321
|
)
|
(2,175
|
)
|
||||
(Increase)
decrease in amount due from joint venture
|
(189
|
)
|
189
|
|||||||
Decrease
(increase) in other current assets
|
111
|
(341
|
)
|
(751
|
)
|
|||||
Increase
in accounts payable and accrued expenses
|
2,243
|
1,938
|
2,666
|
|||||||
Increase
in due to joint venture
|
194
|
|||||||||
Increase
in investment in joint venture
|
(4,000
|
)
|
(1,950
|
)
|
(3,950
|
)
|
||||
Increase
in income taxes payable
|
201
|
|||||||||
Increase
in other current liabilities
|
589
|
|||||||||
Increase
in deferred revenue
|
60,000
|
|||||||||
(Decrease)
increase in deferred lease liability
|
(21
|
)
|
(8
|
)
|
7
|
|||||
Net
cash (used in) provided by operating activities
|
(27,421
|
)
|
(36,877
|
)
|
11,090
|
|||||
Cash
flows from investing activities:
|
||||||||||
Capital
expenditures
|
(1,442
|
)
|
(2,240
|
)
|
(900
|
)
|
||||
Purchases
of marketable securities
|
(71,417
|
)
|
(39,601
|
)
|
(205,301
|
)
|
||||
Sales
of marketable securities
|
51,784
|
66,670
|
124,936
|
|||||||
Increase
in restricted cash
|
(401
|
)
|
(3
|
)
|
(3
|
)
|
||||
Net
cash (used in) provided by investing activities
|
(21,476
|
)
|
24,826
|
(81,268
|
)
|
|||||
Cash
flows from financing activities:
|
||||||||||
Proceeds
from public offerings of Common Stock
|
54,153
|
126,323
|
||||||||
Expenses
associated with public offerings of Common Stock
|
(4,382
|
)
|
(4,768
|
)
|
||||||
Proceeds
from the exercise of stock options and sale of Common Stock under
the
Employee Stock Purchase Plan
|
3,516
|
5,441
|
10,468
|
|||||||
Net
cash provided by financing activities
|
53,287
|
5,441
|
132,023
|
|||||||
Net
increase (decrease) in cash and cash equivalents
|
4,390
|
(6,610
|
)
|
61,845
|
||||||
Cash
and cash equivalents at beginning of period
|
7,447
|
11,837
|
5,227
|
|||||||
Cash
and cash equivalents at end of period
|
$
|
11,837
|
$
|
5,227
|
$
|
67,072
|
||||
Supplemental
disclosure of cash flow information:
|
||||||||||
Cash
paid for interest
|
$
|
4
|
||||||||
Supplemental
disclosure of non-cash investing and financing activities:
|
||||||||||
Fixed
assets included in accounts payable and accrued expenses
|
$
|
17
|
$
|
169
|
$
|
312
|
Computer
equipment
|
3
years
|
Machinery
and equipment
|
5-7
years
|
Furniture
and fixtures
|
5
years
|
Leasehold
improvements
|
Life
of lease
|
Years
Ended December 31,
|
||||||||||
2003
|
2004
|
2005
|
||||||||
Net
loss, as reported
|
$
|
(30,986
|
)
|
$
|
(42,018
|
)
|
$
|
(69,429
|
)
|
|
Add:
Stock-based employee compensation expense included in reported
net
loss
|
103
|
452
|
1,793
|
|||||||
Deduct:
Total stock-based employee compensation determined under fair value
based
method for all awards
|
(11,838
|
)
|
(8,479
|
)
|
(10,148
|
)
|
||||
Pro
forma net loss
|
$
|
(42,721
|
)
|
$
|
(50,045
|
)
|
$
|
(77,784
|
)
|
|
Net
loss per share amounts, basic and diluted:
|
||||||||||
As
reported
|
$
|
(2.32
|
)
|
$
|
(2.48
|
)
|
$
|
(3.33
|
)
|
|
Pro
forma
|
$
|
(3.20
|
)
|
$
|
(2.96
|
)
|
$
|
(3.73
|
)
|
Amortized
|
Fair
|
Unrealized
Holding
|
||||||||||||||
Cost
Basis
|
Value
|
Gains
|
(Losses)
|
Net
|
||||||||||||
2004:
|
||||||||||||||||
Maturities
less than one year:
|
||||||||||||||||
Corporate
debt securities
|
$
|
11,970
|
$
|
11,914
|
$
|
4
|
$
|
(60
|
)
|
$
|
(56
|
)
|
||||
Government-sponsored
entities
|
5,008
|
4,980
|
(28
|
)
|
(28
|
)
|
||||||||||
Maturities
between one and five years:
|
||||||||||||||||
Corporate
debt securities
|
993
|
986
|
(7
|
)
|
(7
|
)
|
||||||||||
Maturities
greater than five years:
|
||||||||||||||||
Municipal
Bonds (ARS)
|
8,100
|
8,100
|
||||||||||||||
$
|
26,071
|
$
|
25,980
|
$
|
4
|
$
|
(95
|
)
|
$
|
(91
|
)
|
Amortized
|
Fair
|
Unrealized
Holding
|
||||||||||||||
Cost
Basis
|
Value
|
Gains
|
(Losses)
|
Net
|
||||||||||||
2005:
|
||||||||||||||||
Maturities
less than one year:
|
||||||||||||||||
Corporate
debt securities
|
$
|
51,458
|
$
|
51,333
|
$
|
(125
|
)
|
$
|
(125
|
)
|
||||||
Government-sponsored
entities
|
2,500
|
2,484
|
(16
|
)
|
(16
|
)
|
||||||||||
Maturities
between one and five years:
|
||||||||||||||||
Corporate
debt securities
|
7,059
|
7,035
|
(24
|
)
|
(24
|
)
|
||||||||||
Maturities
greater than five years:
|
||||||||||||||||
Municipal
Bonds (ARS)
|
45,149
|
45,166
|
$
|
17
|
17
|
|||||||||||
$
|
106,166
|
$
|
106,018
|
$
|
17
|
$
|
(165
|
)
|
$
|
(148
|
)
|
Less
than 12 Months
|
12
Months or Greater
|
Total
|
|||||||||||||||||
Description
of Securities
|
Fair
Value
|
Unrealized
Losses
|
Fair
Value
|
Unrealized
Losses
|
Fair
Value
|
Unrealized
Losses
|
|||||||||||||
Corporate
debt securities
|
$
|
57,377
|
$
|
(142
|
)
|
$
|
991
|
$
|
(7
|
)
|
$
|
58,368
|
$
|
(149
|
)
|
||||
Government-sponsored
entities
|
2,484
|
(16
|
)
|
2,484
|
(16
|
)
|
|||||||||||||
Total
|
$
|
59,861
|
$
|
(158
|
)
|
$
|
991
|
$
|
(7
|
)
|
$
|
60,852
|
$
|
(165
|
)
|
December
31,
|
|||||||
2004
|
2005
|
||||||
Computer
equipment
|
$
|
722
|
$
|
841
|
|||
Machinery
and equipment
|
5,095
|
5,263
|
|||||
Furniture
and fixtures
|
652
|
671
|
|||||
Leasehold
improvements
|
4,119
|
4,241
|
|||||
Construction
in progress
|
445
|
946
|
|||||
11,033
|
11,962
|
||||||
Less,
accumulated depreciation and amortization
|
(6,341
|
)
|
(7,806
|
)
|
|||
$
|
4,692
|
$
|
4,156
|
December
31,
|
|||||||
2004
|
2005
|
||||||
Accounts
payable
|
$
|
1,438
|
$
|
880
|
|||
Accrued
consulting and clinical trial costs
|
3,832
|
6,721
|
|||||
Accrued
payroll and related costs
|
734
|
1,144
|
|||||
Legal
and professional fees
|
1,256
|
1,255
|
|||||
Other
|
238
|
||||||
$
|
7,260
|
$
|
10,238
|
Years
ending December 31,
|
Minimum
Annual
Payments
|
|||
2006
|
$
|
1,645
|
||
2007
|
1,244
|
|||
2008
|
883
|
|||
2009
|
883
|
|||
$
|
4,655
|
December 31,
|
|||||||
2004
|
2005
|
||||||
Cash
|
$
|
873
|
|||||
Due
from Progenics
|
194
|
||||||
Prepaid
expenses
|
$
|
12
|
9
|
||||
Total
assets
|
$
|
12
|
$
|
1,076
|
|||
Accounts
payable to Progenics
|
$
|
189
|
|||||
Accounts
payable to Cytogen
|
4
|
$
|
3
|
||||
Accounts
payable and accrued expenses
|
629
|
332
|
|||||
Stockholders’
(deficit) equity
|
(810
|
)
|
741
|
||||
Total
liabilities and stockholders’ (deficit) equity
|
$
|
12
|
$
|
1,076
|
For
the Year Ended
|
For
the Period from June 15, 1999 (inception) to December 31,
2005
|
||||||||||||
2003
|
2004
|
2005
|
|||||||||||
Interest
income
|
$
|
5
|
$
|
7
|
$
|
9
|
$
|
250
|
|||||
Total
expenses (1)
|
6,909
|
5,799
|
6,358
|
30,707
|
|||||||||
Net
loss
|
$
|
(6,904
|
)
|
$
|
(5,792
|
)
|
$
|
(6,349
|
)
|
$
|
(30,457
|
)
|
Options
Outstanding
|
Options
Exercisable
|
|||||||||||||||
Range
of Exercise Prices
|
Number
Outstanding
|
Weighted
Average
Remaining
Contractual
Life
|
Weighted
Average
Exercise
Price
|
Number
Exercisable
|
Weighted
Average
Exercise
Price
|
|||||||||||
$
1.33 - $ 1.33
|
129
|
4.8
|
$
|
1.33
|
129
|
$
|
1.33
|
|||||||||
$
2.47 - $ 4.00
|
401
|
1.4
|
3.98
|
377
|
3.98
|
|||||||||||
$
4.41 - $ 6.98
|
86
|
6.5
|
5.76
|
79
|
5.75
|
|||||||||||
$
7.15 - $ 11.44
|
178
|
5.4
|
9.65
|
143
|
9.46
|
|||||||||||
$
11.50 - $17.03
|
2,054
|
5.8
|
13.69
|
1,616
|
13.48
|
|||||||||||
$17.10
- $25.62
|
1,123
|
8.0
|
20.49
|
448
|
19.24
|
|||||||||||
$26.00
- $27.44
|
73
|
5.3
|
26.28
|
58
|
26.29
|
|||||||||||
$42.38
- $48.88
|
40
|
4.0
|
44.82
|
40
|
44.82
|
|||||||||||
$70.00
- $70.00
|
15
|
4.3
|
70.00
|
15
|
70.00
|
|||||||||||
$
1.33 - $70.00
|
4,099
|
5.9
|
$
|
14.60
|
2,905
|
$
|
13.17
|
Number
of
Shares
|
Weighted
Average
Exercise
Price
|
||||||
Balance
outstanding, December 31, 2002
|
4,164
|
$
|
12.26
|
||||
2003:
Granted
|
982
|
14.67
|
|||||
Cancelled
|
(126
|
)
|
12.93
|
||||
Exercised
|
(343
|
)
|
6.16
|
||||
Expirations
|
(42
|
)
|
15.62
|
||||
Balance
outstanding, December 31, 2003
|
4,635
|
13.17
|
|||||
2004:
Granted
|
491
|
16.94
|
|||||
Cancelled
|
(336
|
)
|
15.30
|
||||
Exercised
|
(318
|
)
|
10.89
|
||||
Expirations
|
(62
|
)
|
22.27
|
||||
Balance
outstanding, December 31, 2004
|
4,410
|
13.46
|
|||||
2005:
Granted
|
703
|
21.08
|
|||||
Cancelled
|
(351
|
)
|
17.87
|
||||
Exercised
|
(663
|
)
|
12.09
|
||||
Balance
outstanding, December 31, 2005
|
4,099
|
$
|
14.60
|
Qualified
Plan
|
Non-Qualified
Plan
|
||||||||||||
Shares
|
Shares
|
||||||||||||
Purchased
|
Price
Range
|
Purchased
|
Price
Range
|
||||||||||
2003
|
256
|
$
|
3.75-$17.78
|
44
|
$
|
3.75-$6.66
|
|||||||
2004
|
144
|
$
|
7.47-$17.13
|
17
|
$
|
7.47-$17.13
|
|||||||
2005
|
130
|
$
|
13.60-$24.67
|
27
|
$
|
13.60-$24.67
|
Years
Ended December 31,
|
||||||||||||||||||||||||||||
2003
|
2004
|
2005
|
||||||||||||||||||||||||||
No.
of options granted
|
Weighted
Average Exercise Price per Share
|
Weighted
Average Grant Date Fair Value per Share
|
No.
of options granted
|
Weighted
Average Exercise Price per Share
|
Weighted
Average Grant Date Fair Value per Share
|
No.
of options granted
|
Weighted
Average Exercise Price per share
|
Weighted
Average Grant Date Fair Value per Share
|
||||||||||||||||||||
Exercise
price equal to grant date market price
|
963
|
$
|
14.82
|
$
|
10.79
|
472
|
$
|
17.29
|
$
|
12.38
|
680
|
$
|
21.22
|
$
|
17.03
|
|||||||||||||
Exercise
price less than grant date market price
|
19
|
$
|
5.03
|
$
|
9.96
|
19
|
$
|
8.17
|
$
|
14.48
|
23
|
$
|
16.85
|
$
|
18.18
|
|||||||||||||
Total
|
982
|
491
|
703
|
December
31,
|
|||||||
2004
|
2005
|
||||||
Depreciation
and amortization
|
$
|
809
|
$
|
1,033
|
|||
R&D
tax credit carry-forwards
|
4,651
|
5,
692
|
|||||
AMT
credit carry-forwards
|
211
|
412
|
|||||
Net
operating loss carry-forwards
|
51,578
|
49,134
|
|||||
Deferred
revenue
|
23,909
|
||||||
Other
items
|
597
|
3,433
|
|||||
57,846
|
83,613
|
||||||
Valuation
allowance
|
(57,846
|
)
|
(83,613
|
)
|
|||
$
|
— | $ | — |
Year
Ended December 31,
|
||||||
2003
|
2004
|
2005
|
||||
U.S.
Federal statutory rate
|
(34%)
|
(34)%
|
(34%)
|
|||
Exercise
of non-qualified stock options
|
(2.8)
|
(1.8)
|
(2.5)
|
|||
Research
and experimental tax credit
|
1.1
|
0.8
|
0.5
|
|||
UR
Labs license purchase
|
5.7
|
|||||
Change
in valuation allowance
|
36.3
|
35.4
|
30.7
|
|||
Other
|
(0.6)
|
(0.4)
|
(0.3)
|
|||
Income
tax provision
|
0%
|
0%
|
0.2%
|
Net
Loss
(Numerator)
|
Weighted
Average
Common
Shares
(Denominator)
|
Per
Share
Amount
|
||||||||
2003:
|
||||||||||
Basic
and diluted
|
$
|
(30,986
|
)
|
13,367
|
$
|
(2.32
|
)
|
|||
2004:
|
||||||||||
Basic
and diluted
|
$
|
(42,018
|
)
|
16,911
|
$
|
(2.48
|
)
|
|||
2005:
|
||||||||||
Basic
and diluted
|
$
|
(69,429
|
)
|
20,864
|
$
|
(3.33
|
)
|
Years
Ended December 31,
|
|||||||||||||||||||
2003
|
2004
|
2005
|
|||||||||||||||||
Weighted
Average
Number
|
Weighted
Average
Exercise
Price
|
Weighted
Average
Number
|
Weighted
Average
Exercise
Price
|
Weighted
Average
Number
|
Weighted
Average
Exercise
Price
|
||||||||||||||
Options
and warrants
|
4,911
|
$
|
9.53
|
4,378
|
$
|
10.15
|
4,640
|
$
|
13.08
|
||||||||||
Restricted
stock
|
83
|
204
|
|||||||||||||||||
Total
|
4,911
|
4,461
|
4,844
|
Quarter
Ended
March
31,
2004
(unaudited)
|
Quarter
Ended
June
30,
2004
(unaudited)
|
Quarter
Ended
September
30,
2004
(unaudited)
|
Quarter
Ended
December
31,
2004
(unaudited)
|
||||||||||
Revenue
|
$
|
1,748
|
$
|
2,175
|
$
|
2,361
|
$
|
3,292
|
|||||
Net
loss
|
(10,225
|
)
|
(10,876
|
)
|
(10,636
|
)
|
(10,281
|
)
|
|||||
Net
loss per share:
|
|||||||||||||
Basic
and diluted
|
(0.61
|
)
|
(0.64
|
)
|
(0.63
|
)
|
(0.60
|
)
|
Quarter
Ended
March
31,
2005
(unaudited)
|
Quarter
Ended
June
30,
2005
(unaudited)
|
Quarter
Ended
September
30,
2005
(unaudited)
|
Quarter
Ended
December
31,
2005
(unaudited)
|
||||||||||
Revenue
|
$
|
2,589
|
$
|
2,075
|
$
|
2,774
|
$
|
2,048
|
|||||
Net
loss
|
(13,194
|
)
|
(12,795
|
)
|
(10,743
|
)
|
(32,697
|
)
|
|||||
Net
loss per share:
|
|||||||||||||
Basic
and diluted
|
(0.76
|
)
|
(0.65
|
)
|
(0.49
|
)
|
(1.34
|
)
|
PROGENICS
PHARMACEUTICALS, INC.
|
||
By:
|
PAUL
J. MADDON, M.D., PH.D.
|
|
Paul
J. Maddon, M.D., Ph.D.
(Duly
authorized officer of the
Registrant
and Chief Executive Officer, Chief Science Officer and
Director)
|
Signature
|
Capacity
|
Date
|
|
/s/
KURT W. BRINER
|
Co-Chairman
|
March 15,
2006
|
|
Kurt
W. Briner
|
|||
/s/
PAUL F. JACOBSON
|
Co-Chairman
|
March 15,
2006
|
|
Paul
F. Jacobson
|
|||
/s/
PAUL J. MADDON, M.D., PH.D.
|
Chief
Executive Officer, Chief Science
|
March 15,
2006
|
|
Paul
J. Maddon, M.D., Ph.D.
|
Officer
and Director (Principal Executive
Officer)
|
||
/s/
CHARLES A. BAKER
|
Director
|
March 15,
2006
|
|
Charles
A. Baker
|
|||
/s/
MARK F. DALTON
|
Director
|
March 15,
2006
|
|
Mark
F. Dalton
|
|||
/s/
STEPHEN P. GOFF, PH.D.
|
Director
|
March 15,
2006
|
|
Stephen
P. Goff, Ph.D.
|
|||
/s/
DAVID A. SCHEINBERG, M.D., PH.D.
|
Director
|
March 15,
2006
|
|
David
A. Scheinberg, M.D., Ph.D.
|
|||
/s/
ROBERT A. MCKINNEY, CPA
|
Chief
Financial Officer, Senior Vice President,
|
March 15,
2006
|
|
Robert
A. McKinney, CPA
|
Finance
& Operations and Treasurer
|
||
(Principal
Financial and Accounting Officer)
|
Exhibit
Number
|
Description
|
3.1(1)
|
Certificate
of Incorporation of the Registrant, as amended.
|
3.2(1)
|
By-laws
of the Registrant
|
4.1(1)
|
Specimen
Certificate for Common Stock, $.0013 par value per share, of the
Registrant
|
10.1(1)
|
Form
of Registration Rights Agreement
|
10.2(1)
|
1989
Non-Qualified Stock Option Plan‡
|
10.3(1)
|
1993
Stock Option Plan, as amended‡
|
10.4(1)
|
1993
Executive Stock Option Plan‡
|
10.5(4)
|
Amended
and Restated 1996 Stock Incentive Plan‡
|
10.5.1(12)
|
Form
of Non-Qualified Stock Option Agreement‡
|
10.5.2(12)
|
Form
of Restricted Stock Award‡
|
10.6(1)
|
Form
of Indemnification Agreement‡
|
10.7(2)
|
Employment
Agreement dated December 31, 2003 between the Registrant and Dr.
Paul J.
Maddon‡
|
10.8(1)
|
Letter
dated August 25, 1994 between the Registrant and Dr. Robert J.
Israel‡
|
10.9(10)
|
1998
Employee Stock Purchase Plan‡
|
10.10(10)
|
1998
Non-qualified Employee Stock Purchase Plan‡
|
10.11(1)†
|
License
Agreement dated November 17, 1994 between the Registrant and
Sloan-Kettering Institute for Cancer Research
|
10.12(1)†
|
QS-21
License and Supply Agreement dated August 31, 1995 between the
Registrant
and Cambridge Biotech Corporation, a wholly owned subsidiary of
bioMerieux, Inc.
|
10.13(1)†
|
License
Agreement dated March 1, 1989, as amended by a Letter Agreement
dated
March 1, 1989 and as amended by a Letter Agreement dated October
22, 1996
between the Registrant and the Trustees of Columbia
University
|
10.14(6)
|
Amended
and Restated Sublease dated June 6, 2000 between the Registrant
and
Crompton Corporation
|
10.15(3)†
|
Development
and License Agreements, effective as of April 30, 1999, between
Protein
Design Labs, Inc. and the Registrant
|
10.15.1
|
Letter
Agreement dated November 24, 2003 relating to the Development and
License
Agreement between Protein Design Labs, Inc. and the
Registrant
|
10.16(3)†
|
PSMA/PSMP
License Agreement dated June 15, 1999, by and among the Registrant,
Cytogen Corporation and PSMA Development Company LLC
|
10.17(3)†
|
Limited
Liability Company Agreement of PSMA Development Company LLC, dated
June
15, 1999, by and among the Registrant, Cytogen Corporation and
PSMA
Development Company LLC
|
10.18(8)
|
Amendment
Number 1 to Limited Liability Company Agreement of PSMA Development
Company LLC dated March 22, 2002 by and among the Registrant, Cytogen
Corporation and PSMA Development Company LLC
|
10.19(5)
|
Director
Stock Option Plan‡
|
10.20(7)†
|
Exclusive
Sublicense Agreement, dated September 21, 2001, between the Registrant
and
UR Labs, Inc.
|
10.20.1(11)
|
Amendment
to Exclusive Sublicense Agreement between the Registrant and UR
Labs,
Inc., dated September 21, 2001
|
10.21(9)
|
Research
and Development Contract between the National Institutes of Health
and the
Registrant, dated September 26, 2003
|
10.22(9)
|
Agreement
of Lease between Eastview Holdings LLC and the Registrant, dated
September
30, 2003
|
10.23(9)
|
Letter
Agreement amending Agreement of Lease between Eastview Holdings
LLC and
the Registrant, dated October 23, 2003
|
10.24(13)
|
Summary
of Non-Employee Director Compensation‡
|
10.25(14)
†
|
Supply
Agreement, dated January 1, 2005, between Progenics Pharmaceuticals,
Inc.
and Mallinckrodt Inc.
|
10.26
|
License
and Co-Development Agreement dated December 23, 2005 by and among
Wyeth,
acting through Wyeth Pharmaceuticals Division, Wyeth-Whitehall
Pharmaceuticals, Inc. and Wyeth-Ayerst Lederle, Inc. and
Progenics
Pharmaceuticals, Inc. and Progenics Pharmaceuticals Nevada, Inc.
(confidential treatment has been requested as to certain portions,
which
portions have been omitted and filed separately with the
Commission).
|
10.27
|
Option
and License Agreement dated May 8, 1985 by and between the University
of
Chicago and UR Labs, Inc., as amended by the Amendment to Option
and
License Agreement dated September 17, 2005 by and between the
University
of Chicago and UR Labs, Inc., by the Second Amendment to Option
and
License Agreement dated March 3, 1989 by and among the University
of
Chicago, ARCH Development Corporation and UR Labs, Inc. and
by
the
Letter Agreement Related to Progenics' MNTX In-License dated
December 22,
2005 by and among the University of Chicago, acting on behalf
of itself
and ARCH Development Corporation, Progenics Pharmaceuticals,
Inc.,
Progenics Pharmaceuticals Nevada, Inc. and Wyeth, acting through
its Wyeth
Pharmaceuticals Division (confidential treatment has been requested
as to
certain portions, which portions have been omitted and filed
separately
with the Commission).
|
23.1
|
Consent
of PricewaterhouseCoopers LLP
|
31.1
|
Certification
of Paul J. Maddon, M.D., Ph.D., Chief Executive Officer of the
Registrant
pursuant to 13a-14(a) and Rule 15d-14(a) under the Securities Exchange
Act
of 1934, as amended.
|
31.2
|
Certification
of Robert A. McKinney, Chief Financial Officer, Senior Vice President,
Finance and Operations and Treasurer of the Registrant pursuant
to
13a-14(a) and Rule 15d-14(a) under the Securities Exchange Act
of 1934, as
amended.
|
32.1
|
Certification
of Paul J. Maddon, M.D., Ph.D., Chief Executive Officer of the
Registrant
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
906 of
the Sarbanes-Oxley Act of 2002.
|
32.2
|
Certification
of Robert A. McKinney, Chief Financial Officer, Senior Vice President,
Finance and Operations and Treasurer of the Registrant pursuant
to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
|
/s/
PricewaterhouseCoopers LLP
|
|
New
York, New York
|
|
March 15,
2006
|
1.
|
I
have reviewed this annual report on Form 10-K of Progenics
Pharmaceuticals, Inc.;
|
2.
|
Based
on my knowledge, this report does not contain any untrue statement
of a
material fact or omit to state a material fact necessary to make
the
statements made, in light of the circumstances under which such
statements
were made, not misleading with respect to the period covered by
this
report;
|
3.
|
Based
on my knowledge, the financial statements, and other financial
information
included in this report, fairly present in all material respects
the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this
report;
|
4.
|
The
registrant’s other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures
(as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the registrant and
have:
|
a)
|
designed
such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to
ensure
that material information relating to the registrant is made known
to us
by others within the registrant, particularly during the period
in which
this report is being prepared;
|
b)
|
designed
such internal control over financial reporting, or caused such
internal
control over financial reporting to be designed under our supervision,
to
provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles;
|
c)
|
evaluated
the effectiveness of the registrant’s disclosure controls and procedures
and presented in this report our conclusions about the effectiveness
of
the disclosure controls and procedures, as of the end of the period
covered by this report based on such evaluation;
and
|
d)
|
disclosed
in this report any change in the registrant’s internal control over
financial reporting that occurred during the registrant’s most recent
fiscal quarter (the registrant’s fourth fiscal quarter in the case of an
annual report) that has materially affected, or is reasonably likely
to
materially affect, the registrant’s internal control over financial
reporting; and
|
5.
|
The
registrant’s other certifying officer and I have disclosed, based on our
most recent evaluation of internal control over financial reporting,
to
the registrant’s independent registered public accounting firm and the
audit committee of the registrant’s board of directors (or persons
performing the equivalent
function):
|
a)
|
all
significant deficiencies and material weaknesses in the design
or
operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant’s ability to record,
process, summarize and report financial information;
and
|
b)
|
any
fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant’s internal control
over financial reporting.
|
/s/
Paul J. Maddon, M.D., Ph.D.
|
|
Date:
March 15, 2006
|
Paul
J. Maddon, M.D., Ph.D.
Chief
Executive Officer and Chief
Science
Officer (Principal Executive
Officer)
|
1.
|
I
have reviewed this annual report on Form 10-K of Progenics
Pharmaceuticals, Inc.;
|
2.
|
Based
on my knowledge, this report does not contain any untrue statement
of a
material fact or omit to state a material fact necessary to make
the
statements made, in light of the circumstances under which such
statements
were made, not misleading with respect to the period covered by
this
report;
|
3.
|
Based
on my knowledge, the financial statements, and other financial
information
included in this report, fairly present in all material respects
the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this
report;
|
4.
|
The
registrant’s other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures
(as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the registrant and
have:
|
a)
|
designed
such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to
ensure
that material information relating to the registrant is made known
to us
by others within the registrant, particularly during the period
in which
this report is being prepared;
|
b)
|
designed
such internal control over financial reporting, or caused such
internal
control over financial reporting to be designed under our supervision,
to
provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles;
|
c)
|
evaluated
the effectiveness of the registrant’s disclosure controls and procedures
and presented in this report our conclusions about the effectiveness
of
the disclosure controls and procedures, as of the end of the period
covered by this report based on such evaluation;
and
|
d)
|
disclosed
in this report any change in the registrant’s internal control over
financial reporting that occurred during the registrant’s most recent
fiscal quarter (the registrant’s fourth fiscal quarter in the case of an
annual report) that has materially affected, or is reasonably likely
to
materially affect, the registrant’s internal control over financial
reporting; and
|
5.
|
The
registrant’s other certifying officer and I have disclosed, based on our
most recent evaluation of internal control over financial reporting,
to
the registrant’s independent registered public accounting firm and the
audit committee of the registrant’s board of directors (or persons
performing the equivalent
function):
|
a)
|
all
significant deficiencies and material weaknesses in the design
or
operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant’s ability to record,
process, summarize and report financial information;
and
|
b)
|
any
fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant’s internal control
over financial reporting.
|
/s/
Robert A. McKinney
|
|
Date:
March 15, 2006
|
Robert
A. McKinney
Chief
Financial Officer, Senior Vice President, Finance & Operations and
Treasurer (Principal Financial
Officer)
|
/s/
Paul J. Maddon, M.D., Ph.D.
|
|
Date:
March 15, 2006
|
Paul
J. Maddon, M.D., Ph.D.
Chief
Executive Officer and Chief
Science
Officer (Principal Executive
Officer)
|
/s/
Robert A. McKinney
|
|
Date:
March 15, 2006
|
Robert
A. McKinney
Chief
Financial Officer, Senior Vice President, Finance & Operations and
Treasurer (Principal Financial
Officer)
|
1.
|
2
|
||
2.
|
12
|
||
3.
|
17
|
||
4.
|
20
|
||
5.
|
24
|
||
6.
|
26
|
||
7.
|
34
|
||
8.
|
39
|
||
9.
|
42
|
||
10.
|
45
|
||
11.
|
54
|
||
12.
|
55
|
||
13.
|
58
|
1. |
Working
Group
|
3.3.4
|
Wyeth
|
Introduction
|
Wyeth
Non-Defaulting Termination
|
10.6.2
|
Wyeth
Indemnified Party
|
11.2
|
2. |
LICENSE
GRANTS
AND RELATED
MATTERS.
|
(a) |
General.
Wyeth shall not grant a Sublicense to any Third Party in any Major
Market
Country (other than [*]), unless and unti
l
Wyeth provides a written notice to Progenics (a “
Sublicense
Notice
”),
which notice will identify the general scope and purpose of the Sublicense
that Wyeth proposes to grant and the Major Market Country or Countries
to
which it will apply and will either (A) invite Progenics to negotiate
regarding such a Sublicense; or (B) inform Progenics that Wyeth has
determined that Progenics is not capable of performing the activities
covered by the proposed Sublicense in the relevant country or countries.
If the Sublicense Notice invites Progenics to negotiate regarding
a
Sublicense, Wyeth shall not grant Sublicense to any Third Party in
the
relevant country or countries
until:
|
(i) |
Progenics
notifies Wyeth that it declines the opportunity to negotiate with
Wyeth
regarding such a Sublicense;
|
(ii) |
Progenics
does not respond to Wyeth within thirty (30) days after receipt of
the
Sublicense Notice; or
|
(iii) |
the
Negotiation Period (as defined below) expires before Wyeth and Progenics
have entered into a Sublicense.
|
(b) |
Capability
/ Refusal / Failure to Respond.
If
(A) Wyeth determines that Progenics is not capable of performing
the
activities covered by the proposed Sublicense in the relevant country
or
countries, or (B) Progenics responds to the Sublicense Notice by
declining
to negotiate with Wyeth regarding the proposed Sublicense, or (C)
Progenics does not respond to a Sublicense Notice within the thirty
(30)
day period provided for in clause (ii) of Section 2.3.2(a) (General),
then
Wyeth will have no obligation to negotiate with Progenics with respect
to
any Sublicense in the relevant country or countries, and Wyeth will
be
free to grant one or more Sublicense to one or more Third Parties
in such
country or countries at Wyeth’s sole
discretion.
|
(c) |
Consultation
Regarding Capabilities.
Wyeth
shall not determine that Progenics is not capable of performing the
activities covered by the proposed Sublicense in the relevant country
or
countries unless and until Wyeth has given Progenics a reasonable
opportunity to make a presentation to Wyeth demonstrating its
capabilities. Once Wyeth has provided such opportunity to Progenics,
however, Wyeth may determine whether Progenics is capable of performing
the activities covered by the Sublicense in the relevant country
or
countries in its sole discretion.
|
(d) |
Negotiation
Period.
If
the Sublicense Notice invites Progenics to negotiate regarding such
a
Sublicense and Progenics notifies Wyeth, within thirty (30) days
after
receipt of the Sublicense Notice that it desires to negotiate with
Wyeth
regarding the proposed a Sublicense, the Parties shall negotiate
in good
faith with each other for sixty (60) days (or such longer period
as
mutually agreed by the parties) (the “
Negotiation
Period
”)
regarding a mutually satisfactory Sublicense. Neither party shall
be
obligated to enter into a Sublicense.
In
the event that the Negotiation Period expires before Wyeth and Progenics
have entered into a Sublicense,
Wyeth
will have no further obligation to negotiate with Progenics with
respect
to any Sublicense in the relevant country or countries, and Wyeth
will be
free to grant one or more Sublicenses to one or more Third Parties
in such
country or countries at Wyeth’s sole discretion, subject to the terms and
conditions of Section
2.3.1
(Sublicenses; General). However, if negotiations between the Parties
end
without the Parties executing a Sublicense agreement for such country
or
countries, then Wyeth shall not enter into any Sublicense of comparable
scope in such country or countries containing financial terms that
are
more favorable to the third party than the financial terms that Progenics
last offered to Wyeth during the Negotiation Period without first
offering
Progenics such Sublicense containing such financial terms;
provided
,
however
,
that Wyeth shall not be obligated to first offer such more favorable
financial terms to Progenics if Wyeth determines, in its sole discretion,
that Progenics is no longer capable of performing the activities
covered
by the Sublicense in the relevant country or countries after once
again
giving Progenics an opportunity to make a presentation to Wyeth in
accordance with Section
2.3.2
(c)
(Consultation Regarding Capabilities).
|
(e) |
Termination
of Right.
The right of first negotiation granted to Progenics in this Section
2.3.2
(Progenics Right of First Negotiation) shall be extinguished upon
the
occurrence of a Progenics Change of
Control.
|
3. |
GOVERNANCE
OF COL
LABORATION
|
4. |
DEVE
LOPMENT
|
6. |
PAYMENTS
BY WYETH TO
PROGENICS.
|
Condition
|
Payment
|
SC
Product:
|
|
·
[*]
|
$[*]
|
·
[*]
|
$[*]
|
·
[*]
|
$[*]
|
·
[*]
|
$[*]
|
·
[*]
|
$[*]
|
·
[*]
|
$[*]
|
IV
Product:
|
|
·
[*]
|
$[*]
|
·
[*]
|
$[*]
|
·
[*]
|
$[*]
|
·
[*]
|
$[*]
|
·
[*]
|
$[*]
|
·
[*]
|
$[*]
|
·
[*]
|
$[*]
|
Oral
Product:
|
|
·
[*]
|
$[*]
|
·
[*]
|
$[*]
|
·
[*]
|
$[*]
|
·
[*]
|
$[*]
|
·
[*]
|
$[*]
|
·
[*]
|
$[*]
|
·
[*]
|
$[*]
|
Condition
|
Payment
|
·
[*]
|
$[*]
|
·
[*]
|
$[*]
|
·
[*]
|
$[*]
|
U.S.
Combined Net Sales of
All
Products
|
Applicable
Net Sales
Percentage
|
[*]
|
[*]%
|
[*]
|
[*]%
|
[*]
|
[*]%
|
[*]
|
[*]%
|
[*]
|
[*]%
|
Ex-U.S.
Worldwide Combined Net
Sales
of All Products
|
Applicable
Net Sales
Percentage
|
[*]
|
[*]%
|
[*]
|
[*]%
|
[*]
|
[*]%
|
7. |
INTELLECTUAL
P
ROPERTY.
|
8. |
CONFIDEN
TIALITY
.
|
9. |
REPRESENTATIONS
AND
WARRANTIES.
|
10. |
TERM
AND TE
RMINA
TION
|
11. |
INDEMNIFICATION
AND
INSURANCE.
|
12. |
REGULATORY
MATTERS, PR
ODUCT
SAFETY ISSUES, PRODUCT
RECALLS
|
13. |
MISCEL
LANE
OUS.
|
Wyeth,
acting through its Wyeth Pharmaceuticals Division
|
Progenics
Pharmaceuticals, Inc.
|
By
_
/s/
Mark
L. Lee
|
By
_
/s/
Paul
J. Maddon
|
Name:
Mark
L. Lee
Title:
Senior
Vice President-Global Business
Development
|
Name:
Paul
J. Maddon
Title:
Chief
Executive Officer
|
Wyeth-Whitehall
Pharmaceuticals, Inc.
|
Progenics
Pharmaceuticals Nevada, Inc.
|
By
_
/s/
Ronald
W. Alice
|
By_
/
s/
Paul
J. Maddon
|
Name:
Ronald
W. Alice
Title:
Assistant
Secretary
|
Name:
Paul
J. Maddon
Title:
President
|
Wyeth-Ayerst
Lederle, Inc.
|
|
By
_
/s/
Ronald
W. Alice
|
|
Name:
Ronald
W. Alice
Title:
Assistant
Secretary
|
Contacts:
|
Wyeth:
Media
Contact:
Gerald
Burr
Wyeth
Pharmaceuticals
(484)
865-5138
Douglas
Petkus
Wyeth
(973)
660-5218
Investor
Contacts:
Justin
Victoria
Wyeth
(973)
660-5340
|
Progenics
Pharmaceuticals, Inc.:
Richard
W. Krawiec, Ph.D.
VP,
Investor Relations
and
Corporate Communications
(914)
789-2800
rkrawiec@progenics.com
|
· |
Subcutaneous
injection for the treatment of intractable constipation in patients
with
advanced medical illness (AMI), including cancer and
AIDS;
|
· |
Intravenous
infusion for the treatment of patients with gastrointestinal tract
and
urinary dysfunction that commonly occurs after major abdominal and
prolonged surgeries; and
|
· |
Oral
formulation for the treatment of opioid-induced constipation in patients
with chronic pain, including those suffering from headaches, joint
pain,
lower-back pain, sickle-cell disease, muscle pain and other disorders
requiring opioid analgesics.
|
· |
Advanced
medical illness:
Approximately
1.7 million patients suffer from AMI each year in the U.S., including
patients with cancer, AIDS, sickle-cell disease and other painful
terminal
illnesses. The majority of those treated with opioids for pain suffer
debilitating constipation.
|
· |
Post-operative
bowel dysfunction:
More
than 20 million surgeries occur in the U.S. each year, with more
than
two-million patients at high risk for developing post-operative bowel
dysfunction, a serious paralysis of the gastrointestinal tract.
Post-operative bowel dysfunction is a major factor in increasing
hospital
stay, as patients are typically not discharged until bowel and urinary
functions are restored.
|
· |
Chronic
pain
:
Approximately five-million patients receive opioids on a chronic
basis,
and many experience chronic opioid-induced constipation.
|
UR
LABS, INC.
By:
/s/
William
Drell
William Drell
Title:
President
|
THE
UNIVERSITY OF CHICAGO
By:
/s/
Donald
Sigel
Donald
Sigel
Title:
Director,
Office of Sponsored
Programs
|
Date:
June
4, 1985
|
Date:
May
8, 1985
|
UR
Labs, Inc.
By:
/s/
William
Drell
William
Drell
President
|
Acknowledged,
The
University of Chicago
By:
/s/
Donald
Sigal
Donald
Sigal
Director,
Office of Sponsored Programs
|
Date:
Sept.
9, 1985
|
1.
|
URL
shall pay the University a royalty of [*] of the Net Selling Price
for
Compound sold by URL or any sublicensee or assignee under a U.S.
patent.
URL shall pay to the University [*] of any royalties (or income
in lieu of
royalties) received by URL from licensing or assigning rights to
have
made, use, or sell compound and/or products incorporating Compound
under
patents other than a U.S. patent.
|
UR
LABS, INC.
By:
/s/
William
Drell
William Drell
Its:
President
|
THE
UNIVERSITY OF CHICAGO
By:
/s/
Janett
Trubatch
Janett Trubatch
Its:
Associate Vice President for
Research
|
UR
LABS, INC.
By:
/s/
William
Drell
William Drell
Title:
President
|
THE
UNIVERSITY OF CHICAGO
By:
/s/
University of Chicago Representative
|
Date:
3/3/89
|
Date:
2/14/89
|
ARCH
DEVELOPMENT CORPORATION
By:
/s/
ARCH Development Corporation Representative
Date:
2/14/89
|
1. |
Definitions
|
2. |
University
Acknowledgments, Consents, Waivers, Representations, Warranties,
and
Agreements
|
3. |
Progenics
and ProNev Acknowledgments and
Agreements
|
4. |
Wyeth
Indemnity of University
|
5. |
Termination
of the University Agreement
|
5.1.1. |
Direct
License to Progenics.
During
the term of the Progenics-Wyeth Agreement and solely for the purpose
of
maintaining the continuity of the license granted by ProNev to Progenics
of the UR Labs-Progenics Agreement, in the event that the University
License Agreement is terminated for any reason other than as a result
of
Progenics’ uncured material breach of the UR Labs-Progenics Agreement (a
“
Progenics
Non-Defaulting Termination
”),
subject to the occurrence of the Progenics Non-Defaulting Termination,
the
University hereby grants and agrees to grant to Progenics a direct
license
under the University Patents and University Know-How, which license
shall
be on the terms and conditions of the University Agreement (as amended)
and this Agreement. Furthermore, in such event, the license granted
by the
University to Progenics under this
|
5.1.2. |
Termination
of Direct License to Progenics.
In
the event that the sublicense granted by ProNev to Progenics under
the UR
Labs-Progenics Agreement is terminated, in whole or in part, for
an
uncured material breach thereof caused by Progenics, the license
granted
by the University to Progenics under Section 5.1.1 shall likewise
be
automatically terminated to the same
extent.
|
5.1.3. |
Payments
in the Event of Progenics Non-Defaulting Termination.
In
consideration of the direct license granted by the University to
Progenics
under Section 5.1.1, in the event of a Progenics Non-Defaulting
Termination of the University Agreement, Progenics shall pay to the
University any payments which ProNev would have been required to
pay to
the University under the University Agreement (had the University
Agreement remained in effect) in connection with the sublicense of
the
University Patents and University Know-How under the Progenics-Wyeth
Agreement at such times such payments would have otherwise become
due
under the University Agreement. Progenics shall be entitled to deduct
any
amount paid to the University under this Section
5.1.2 from any amounts that Progenics owes to ProNev under the UR
Labs-Progenics Agreement.
|
5.1.4. |
Restatement
of License Agreement.
In
the event of a Progenics Non-Defaulting Termination of the University
Agreement, at Progenics’ or the University’s request, Progenics and the
University shall enter into an agreement memorializing and restating
the
direct license granted to by the University to Progenics under Section
5.1
on the terms and conditions provided for in this
Agreement.
|
5.2.1. |
Direct
License To Wyeth.
Solely
for the purpose of maintaining the continuity of the license granted
by
Progenics to Wyeth pursuant to the
|
5.2.2. |
Termination
of Direct License to Wyeth.
In
the event that the sublicense granted by Progenics to Wyeth under
the
Progenics-Wyeth Agreement is terminated in whole or in part, for
an
uncured material breach thereof caused by Wyeth, the license granted
by
the University to Wyeth under Section 5.2.1 shall likewise be
automatically terminated to the same
extent.
|
5.2.3. |
Payments
in the Event of Wyeth Non-Defaulting Termination.
In
consideration of the direct license granted by University to Wyeth
under
Section
5.2.1
,
in the event of a Wyeth Non-Defaulting Termination of the University
Agreement or the license granted under Section
5.1.1
,
Wyeth shall pay to the University any and all payments which ProNev
would
have been required to pay to the University under the University
Agreement
(had the University Agreement remained in effect) in connection with
the
sublicense of the University Patents and University Know-How under
the
Progenics-Wyeth Agreement at such times as such payments would have
otherwise become due under the University Agreement. Wyeth shall
be
entitled to deduct any amount paid to the University under this Section
5.2.3
from any amounts that Wyeth owes to Progenics under the Progenics-Wyeth
Agreement.
|
5.2.4. |
Restatement
of License Agreement.
In
the event of a Wyeth Non-Defaulting Termination of the University
Agreement or the license granted under Section
5.1.1
,
at Wyeth’s request, Wyeth and the University shall enter into an agreement
memorializing and restating the direct license granted to by the
University to Wyeth under Section
5.2
on
the terms and conditions provided for in this Agreement.
|
6. |
Miscellaneous
Provisions
|