Filed
Pursuant to Rule 424(b)(5)
Registration
No. 333-159856
PROSPECTUS
SUPPLEMENT
(To
Prospectus Dated June 22, 2009)
32,000,000
Shares
HEMISPHERX
BIOPHARMA, INC.
Common
Stock
We have
entered into a sales agreement with the Maxim Group LLC relating to shares of
our common stock offered by this prospectus supplement and the accompanying
prospectus. In accordance with the terms of the sales agreement, we may offer
and sell up to the maximum of 32,000,000 shares of our common stock, $0.001 par
value per share, from time to time through the Maxim Group LLC, acting as
agent. Our common stock is listed on the NYSE Amex under the ticker
symbol “HEB”. Sales of shares of our common stock under this prospectus
supplement, if any, may be made by any method permitted by law deemed to be an
“at the market” offering as defined in Rule 415 under the Securities Act of
1933, as amended (the “Securities Act”), which includes sales made directly on
the NYSE Amex, the existing trading market for our common stock, or sales made
to or through a market maker other than on an exchange. With our express written
consent, the sales agent may also sell shares of our common stock in privately
negotiated transactions. The sales agent will make all sales on a best efforts
basis using commercially reasonable efforts consistent with its normal trading
and sales practices, on terms mutually agreed upon by the sales agent and us.
The last reported sale price of our common stock on the NYSE Amex on May 25,
2010 was $0.64 per share.
You
should read “Risk Factors” beginning on page S-3 of this prospectus supplement
and the risk factors described in other documents incorporated by reference
herein before buying our securities.
The Maxim
Group LLC will be entitled to compensation at a fixed commission rate of 4.0% of
the gross sales price per share sold, up to aggregate gross proceeds of
$10,000,000, and, thereafter, at a fixed commission rate of 3.0% of the gross
sales price per share sold. In connection with the
sale of the common stock on our behalf, the Maxim Group LLC may be deemed to be
an “underwriter” within the meaning of the Securities Act, and the compensation
of the Maxim Group LLC may be deemed to be underwriting commissions or
discounts.
We have
agreed to indemnify the sales agent and its controlling persons against certain
liabilities, including liabilities under the Securities Act. If we are unable to
provide this indemnification, we will contribute to payments the sales agent and
its controlling persons may be required to make in respect of those
liabilities.
Neither
the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or determined if this prospectus
supplement and the accompanying prospectus is truthful or complete. Any
representation to the contrary is a criminal offense.
Maxim
Group LLC
The date
of this prospectus supplement is May 28, 2010.
Prospectus
Supplement
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Page
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About
This Prospectus Supplement
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S-1
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Prospectus
Supplement Summary
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S-1
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The
Offering
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S-2
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Risk
Factors
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S-3
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Special
Note Regarding Forward-Looking Statements
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S-3
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Use
of Proceeds
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S-4
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Price
Range of Our Common Stock
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S-4
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Dividend
Policy
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S-4
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Dilution
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S-5
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Plan
of Distribution
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S-6
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Legal
Matters
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S-7
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Experts
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S-7
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Where
You Can Find More Information
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S-7
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Important
Information Incorporated by Reference
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S-7
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Prospectus
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Page
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Prospectus
Summary
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2
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Risk
Factors
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4
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Special
Note Regarding Forward-Looking Statements
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18
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Ratio
Of Earnings To Fixed Charges
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19
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Use
of Proceeds
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19
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Description
of Capital Stock
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19
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Description
of Warrants
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22
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Description
of Debt Securities
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23
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Plan
of Distribution
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35
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Legal
Matters
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37
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Experts
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37
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Where
You Can Find More Information
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38
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Information
Incorporated By Reference
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38
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We
provide information to you about this offering of shares of our common stock in
this prospectus supplement, which describes the specific details regarding this
offering, and in the accompanying prospectus, which provides general
information, some of which may not apply to this offering. Generally, when we
refer to this “prospectus,” we are referring to both documents
combined.
You
should rely only on the information contained or incorporated by reference in
this prospectus supplement and the accompanying prospectus. We have not, and the
Maxim Group LLC has not, authorized anyone to provide you with information
different from that contained or incorporated by reference in this prospectus
supplement or the accompanying prospectus. These documents do not constitute an
offer to sell or solicitation of an offer to buy these shares of common stock in
any circumstance under which the offer or solicitation is unlawful. The
information contained in this prospectus supplement, the accompanying prospectus
and the documents incorporated by reference herein and therein are accurate only
as of their respective dates, regardless of the time of delivery of this
prospectus supplement or the sale of our common stock. If information in this
prospectus supplement, or information incorporated by reference in this
prospectus supplement and the accompanying prospectus that is of a more recent
date than the accompanying prospectus, is inconsistent with the accompanying
prospectus, this prospectus supplement, or the information incorporated by
reference in this prospectus supplement and the accompanying prospectus, will
apply and will supersede that information in the accompanying
prospectus. References
in this prospectus supplement to “Hemispherx,” “we,” “our” or “us” refer to
Hemispherx Biopharma, Inc. and its subsidiaries.
This
summary does not contain all of the information that you should consider before
investing in our common stock. You should read this entire prospectus supplement
and the accompanying prospectus carefully, including “Risk Factors,” and the
financial statements and other information incorporated by reference in this
prospectus supplement and the accompanying prospectus, before making an
investment in our common stock.
Our
Business
We are a
specialty pharmaceutical company based in Philadelphia, Pennsylvania and engaged
in the clinical development of new drug therapies based on natural immune system
enhancing technologies for the treatment of viral and immune based chronic
disorders. We were founded in the early 1970s doing contract research
for the National Institutes of Health. Since that time, we have
established a strong foundation of laboratory, pre-clinical and clinical data
with respect to the development of natural interferon and nucleic acids to
enhance the natural antiviral defense system of the human body and to aid the
development of therapeutic products for the treatment of certain chronic
diseases. We have three domestic subsidiaries BioPro Corp., BioAegean
Corp., and Core BioTech Corp., all of which are incorporated in Delaware and are
dormant. Our foreign subsidiary is Hemispherx Biopharma Europe
N.V./S.A. established in Belgium in 1998, which has no activity. All
significant intercompany balances and transactions have been eliminated in
consolidation.
Our
current strategic focus is derived from four applications of our two core
pharmaceutical technology platforms Ampligen® and Alferon N
Injection®. The commercial focus for Ampligen® includes application
as a treatment for Chronic Fatigue Syndrome (“CFS”) and as an influenza vaccine
enhancer (adjuvant) for both therapeutic and preventative vaccine
development. Alferon N Injection® is a Food and Drug Administration
(“FDA”) approved product with an indication for refractory or recurring genital
warts. Alferon® LDO (Low Dose Oral) is a formulation currently under
development targeting influenza.
S-1
We own
and operate a 43,000 sq. ft. FDA approved facility in New Brunswick, New Jersey
that was primarily designed to produce Alferon®. We are currently undertaking a
major capital improvement program to enhance our manufacturing capability for
Alferon N Injection®, Alferon® LDO and Ampligen®. The planned capital
improvements include upgrade to the ventilation and electrical distribution
systems; upgrade of the high pressure boiler to support process equipment and
battery management system; building a utility mezzanine to support the
installation of a new water and waste treatment process.
Our
Corporate Information
Our
principal executive offices are located at One Penn Center, 1617 JFK Boulevard,
Philadelphia, Pennsylvania 19103, and our telephone number is 215-988-0080, and
our website can be accessed at www.hemispherx.net.
Information contained in our website does not constitute part of this prospectus
supplement or the accompanying prospectus.
THE
OFFERING
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Offering
price and proceeds:
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Variable
at-the-market pricing, with aggregate gross proceeds from the sale of up
to 32,000,000 shares.
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Manner
of offering:
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“At-the-market”
offering that may be made from time to time through our agent, the Maxim
Group LLC. See “Plan of Distribution” on page S-6.
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Use
of proceed:
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We
intend to use the net proceeds from this offering to meet our working
capital needs as well as to offset the costs related to capital
improvements and clinical programs. See “Use of
Proceeds”.
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Risk
factors:
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You
should read the “Risk Factors” section of this prospectus supplement and
in the documents incorporated by reference in this prospectus supplement
for a discussion of risks to consider before deciding to purchase shares
of our common stock.
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NYSE
Amex trading symbol:
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HEB
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S-2
Investment
in our common stock involves a high degree of risk. In addition to the other
information included or incorporated by reference in this prospectus supplement
and the accompanying prospectus, you should carefully consider the risks
described below and in the section entitled “Risk Factors” in our Annual Report
on Form 10-K for our most recent fiscal year filed with the Securities and
Exchange Commission, and in other reports we file with the Securities and
Exchange Commission that are incorporated by reference herein, before making an
investment decision. The risks and uncertainties described therein and below
could adversely affect our business, operating results and financial condition,
as well as cause the value of our common stock to decline. You may lose all or
part of your investment as a result. You should also refer to the other
information contained in this prospectus supplement and the accompanying
prospectus, or incorporated by reference, including our financial statements and
the notes to those statements, and the information set forth under the caption
“Special Note Regarding Forward-Looking Statements.” The risks described below
and contained in our Annual Report on Form 10-K and in our other periodic
reports are not the only ones that we face. Additional risks not presently known
to us or that we currently deem immaterial may also affect our business
operations.
Risks
Related to this Offering
We
will have broad discretion in how we use the proceeds, and we may use the
proceeds in ways in which you and other stockholders may disagree.
We plan
to use the net proceeds from the sale of shares of our common stock in this
offering to meet our working capital needs, as well as for general corporate
purposes. Pending these uses, we intend to invest the net proceeds in investment
grade, interest bearing securities. Our management will have broad discretion in
the application of the proceeds from this offering and could spend the proceeds
in ways that do not necessarily improve our operating results or enhance the
value of our common stock.
Investors
in this offering will suffer immediate and substantial dilution in the net
tangible book value per share of our common stock.
Because
the assumed price per share of our common stock in this offering is
substantially higher than the net tangible book value per share of common stock,
investors in this offering will suffer immediate and substantial dilution in the
net tangible book value per share of common stock. Assuming we sold all
32,000,000 shares at an assumed price to the public of $0.64 per share, the last
reported sale price of our common stock on May 25, 2010, and after deducting the
estimated commissions and offering expenses payable by us, if you purchase
shares in this offering, you will suffer immediate and substantial dilution of
approximately $0.17 per share in the net tangible book value of our common
stock.
Because
the risk factors referred to above and our Annual Report on Form 10-K for our
most recent fiscal year filed with the Securities and Exchange Commission and in
other reports we file with the Securities and Exchange Commission that are
incorporated by reference herein, could cause actual results or outcomes to
differ materially from those expressed in any forward-looking statements made by
us, you should not place undue reliance on any such forward-looking statements.
Further, any forward-looking statement speaks only as of the date on which it is
made and we undertake no obligation to update any forward-looking statement or
statements to reflect events or circumstances after the date on which such
statement is made or reflect the occurrence of unanticipated
events. New factors emerge from time to time, and it is not possible
for us to predict which will arise. We cannot assess the impact of
each factor on our business or the extent to which any factor, or combination of
factors, may cause actual results to differ materially from those contained in
any forward-looking statements. We specifically note that statements
regarding potential drugs, their potential therapeutic effect, the possibility
of obtaining regulatory approval, our ability to manufacture and sell any
products, market acceptance or our ability to earn a profit from sales or
licenses of any drugs or our ability to discover new drugs in the future are all
forward-looking in nature.
S-3
We plan
to use the net proceeds from the sale of shares of our common stock in this
offering to meet our working capital needs, as well as to offset the costs
related to capital improvements at our New Brunswick, NJ manufacturing facility
and clinical programs utilizing Ampligen® and Alferon®. Pending these uses, we
intend to invest the net proceeds in investment grade, interest bearing
securities.
Our
common stock is traded on the NYSE Amex under the symbol “HEB”. The following
table sets forth, for the periods indicated, the reported high and low sales
prices per share of our common stock as reported by the NYSE Amex:
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Fiscal
Year Ended December 31, 2008
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High
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Low
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||||||
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First
Quarter
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$ | 0.89 | $ | 0.62 | ||||
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Second
Quarter
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$ | 0.90 | $ | 0.65 | ||||
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Third
Quarter
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$ | 1.07 | $ | 0.33 | ||||
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Fourth
Quarter
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$ | 0.66 | $ | 0.31 | ||||
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Fiscal
Year Ending December 31, 2009
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High
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Low
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||||||
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First
Quarter
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$ | 0.80 | $ | 0.32 | ||||
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Second
Quarter
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$ | 3.75 | $ | 0.46 | ||||
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Third
Quarter
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$ | 3.31 | $ | 1.90 | ||||
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Fourth
Quarter
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$ | 1.95 | $ | 0.56 | ||||
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Fiscal
Year Ending December 31, 2010
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High
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Low
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||||||
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First
Quarter
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$ | 0.83 | $ | 0.57 | ||||
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Second
Quarter (through May 25, 2010)
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$ | 0.81 | $ | 0.64 | ||||
As of May
25, 2010, the closing price of our common stock as reported by the NYSE Amex was
$0.64 per share and there were approximately 220 holders of record of our common
stock. This does not include the number of persons whose stock is in nominee or
“street name” accounts through brokers.
We have
never declared or paid any cash dividends on our common stock. We currently
intend to retain any future earnings to finance the growth and development of
our business. Therefore, we do not anticipate that we will declare or pay any
cash dividends on our common stock in the foreseeable future. Any future
determination to pay cash dividends will be at the discretion of our Board of
Directors and will depend on our financial condition, results of operations,
capital requirements, restrictions under any existing indebtedness and other
factors the Board of Directors deems relevant.
S-4
If you
purchase shares of our common stock from us, your interest will be diluted to
the extent of the difference between the public offering price per share you pay
and the net tangible book value per share of our common stock immediately after
this offering. Our net tangible book value as of March 31, 2010, was
approximately $57,558,000, or $0.43 per share of common stock. Net tangible book
value per share is calculated by subtracting our total liabilities from our
total tangible assets, which is total assets less intangible assets of
approximately $838,000, and dividing this amount by the 132,860,602 issued and
outstanding shares of common stock outstanding as of March 31, 2010. Assuming we
sold all 32,000,000 shares at an assumed price to the public of $0.64 per share,
the last reported sale price of our common stock on May 25, 2010, and after
deducting the estimated commissions and offering expenses of payable by us, our
adjusted net tangible book value as of March 31, 2010 would have been
approximately $77,084, 000, or $0.47 per share of common stock. This would
represent an immediate increase in the net tangible book value of approximately
$0.04 per share to our existing stockholders and an immediate and substantial
dilution in the net tangible book value of $0.17 per share of common stock to
new investors. The following table illustrates this calculation on a per share
basis:
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Existing
Stockholders
(Approx.)
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New
Investors
(Approx.)
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Assumed
public offering price per share
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$ | 0.64 | ||||||
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Net
tangible book value per share as of March 31, 2010
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$ | 57,558,000 | ||||||
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Increase
per share attributable to investors participating in this
offering
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$ | 0.04 | ||||||
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As
adjusted net tangible book value per share after this
offering
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$ | 77,084,000 | ||||||
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Dilution
per share to investors participating in this offering
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$ | 0.17 | ||||||
The
information in the table above is provided for illustrative purposes and assumes
that all 32,000,000 shares of common stock offered hereby is sold at a price of
$0.64 per share, the last reported sale price of our common stock on May 25,
2010. The shares, if any, sold pursuant to the sales agreement will be sold from
time to time at various prices that will depend largely on the market price of
our common stock at the time of sale. An increase, or decrease, of $0.25 per
share in the price at which the shares are sold from the assumed offering price
of $0.64 per share shown in the table above, assuming all 32,000,000 shares of
common stock offered are sold at that price, would increase (or decrease) our
adjusted net tangible book value per share after the offering by approximately
$7,760,000 and $0.04 per share, respectively, and the dilution in net tangible
book value per share new investors in this offering by approximately $27,286,000
and $0.38 per share, respectively, after deducting the estimated commissions of
the Maxim Group LLC and estimated aggregate offering expenses payable by
us.
The
information in the foregoing table does not take into account further dilution
to new investors that could occur upon the exercise of outstanding options
having a per share exercise price less than the price per share at which new
investors purchase the shares offered hereby. As of May 25, 2010, there were
132,813,489 shares of common stock outstanding, which does not
include:
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•
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8,817,912
shares of our common stock issuable upon exercise of outstanding stock
options under our stock option plans as of May 25, 2010, at a weighted
average exercise price of $2.57;
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•
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106,920
shares of restricted stock; and
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•
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14,557,252
shares of our common stock issuable upon exercise of outstanding warrants
as of May 25, 2010 at a weighted average price of $1.81 per
share.
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S-5
We have
entered into a sales agreement with the Maxim Group LLC (“Maxim”). Subject to
the terms and conditions of the sales agreement, we may offer and sell up to
32,000,000 shares of our common stock from time to time through Maxim. Sales of
the shares, if any, will be made by means of ordinary brokers’ transactions on
the NYSE Amex at market prices. Additionally, under the terms of the sales
agreement, we may also sell shares of our common stock through Maxim, as sales
agent, on the NYSE Amex at negotiated prices or at prices related to the
prevailing market price. With our express written consent, Maxim also may also
sell shares of our common stock in privately negotiated
transactions. As sales agent, Maxim will not engage in any
transactions that stabilize our common stock.
Maxim, as
sales agent, will use its commercially reasonable efforts to sell shares of
common stock on our behalf on a daily basis or as otherwise agreed upon by us
and Maxim. We will designate the maximum amount of shares of common stock to be
sold through Maxim on a daily basis or otherwise as we and Maxim agree. We may
instruct Maxim not to sell shares of common stock if the sales cannot be
effected at or above the price designated by us in any such instruction. We or
Maxim may suspend the offering of shares of common stock by notifying the
other.
We will
pay Maxim a commission equal to 3.0% of the gross sales price per share sold, up
to aggregate gross proceeds of $10,000,000, and, thereafter, at a fixed
commission rate of 4.0% of the gross sales price per share sold. The remaining
sales proceeds, after deducting any expenses payable by us and any transaction
fees imposed by any governmental or self-regulatory organization in connection
with the sales, will equal our net proceeds for the sale of the shares. All
expenses of the offering will be paid by us. We estimate that the expenses of
the offering payable by us, excluding discounts and commissions, will be
approximately $139,600. We have also agreed to reimburse Maxim for certain of
its expenses in an amount not to exceed $100,000.
Settlement
for sales of common stock will occur on the third business day following the
date on which any sales were made in return for payment of the net proceeds to
us. There is no arrangement for funds to be received in an escrow, trust or
similar arrangement.
In
connection with the sale of common stock on our behalf, Maxim may be deemed to
be an “underwriter” within the meaning of the Securities Act, and the
compensation paid to Maxim may be deemed to be underwriting commissions or
discounts. We have agreed to indemnify Maxim against certain liabilities,
including liabilities under the Securities Act, or to contribute to payments
that Maxim may be required to make. Maxim may engage in transactions with, or
perform other services for, us in the ordinary course of business.
Our
shares are traded on the NYSE Amex under the symbol “HEB”.
In
compliance with the guidelines of the Financial Industry Regulatory Authority,
Inc. (“FINRA”), the maximum discount or commission to be received by any FINRA
member or independent broker dealer may not exceed 8% of the aggregate offering
price of the shares offered pursuant to this prospectus supplement.
In
connection with any future sales of common stock made under the sales agreement
or terms agreement, Regulation M may require that Maxim observe certain
restrictions with respect to its trading of our common stock. Such restrictions
could negatively impact the liquidity in our common stock.
The
offering of common stock pursuant to the sales agreement will terminate upon the
earlier of (i) the sale of all 32,000,000 shares of common stock subject to the
sales agreement or (ii) the termination of the sales agreement by either Maxim
or us.
S-6
The
validity of the common stock offered by this prospectus supplement and the
accompanying prospectus will be passed upon for us by Silverman Sclar Shin &
Byrne PLLC, New York, New York. Certain legal matters in connection with the
offering of the common stock will be passed upon for Maxim Group LLC by Goodwin
Procter LLP, New York, New York.
The
financial statements incorporated in this prospectus supplement by reference
from the Company's Annual Report on Form 10-K have been audited by McGladrey
& Pullen LLP, an independent registered public accounting firm, as stated in
their report, which is incorporated herein by reference (which report expresses
an unqualified opinion on the consolidated financial statements). Such financial
statements have been so incorporated in reliance upon the report of such firm
given upon their authority as experts in accounting and auditing.
This
prospectus is part of a registration statement on Form S-3 that we filed with
the SEC. This prospectus does not contain all of the information included in the
registration statement. For further information about us and our securities, you
should refer to the registration statement and the exhibits filed with the
registration statement.
We are
subject to the information requirements of the Securities Exchange Act of 1934
and file annual, quarterly and current reports, proxy statements and other
information with the SEC. You can read our SEC filings, including the
registration statement, over the Internet at the SEC’s website at www.sec.gov or
through our website at www.hemispherx.net. Information contained on our website
is not considered to be a part of, nor incorporated by reference in, this
prospectus. You may also read and copy any document we file with the SEC at its
Public Reference Room at 100 F Street, NE, Washington, D.C. 20549.
You may
also obtain copies of the documents at prescribed rates by writing to the Public
Reference Room of the SEC at 100 F Street, NE, Washington, D.C. 20549. Please
call the SEC at 1-800-SEC-0330 for further information on the operation of the
Public Reference Room.
The SEC
allows us to “incorporate by reference” the information that we file with them,
which means that we can disclose important information to you by referring you
to those documents. The information incorporated by reference is considered to
be an important part of this prospectus, and later information that we file with
the SEC will automatically update and supersede this information. We incorporate
by reference the following documents and any future filing made with the SEC
under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of
1934 prior to the termination of the offering:
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•
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Annual
Report on Form 10-K for the fiscal year ended December 31, 2009;
and
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•
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Quarterly
Report on Form 10-Q for the period ended March 31, 2010;
and
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•
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The
description of our Common Stock contained in our registration statement on
Form S-1, SEC File No. 333-117178, and any amendment or report filed for
the purpose of updating this description filed subsequent to the date of
this prospectus and prior to the termination of this
offering.
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S-7
You may
request a copy of these filings, at no cost, by writing or telephoning us at the
following address:
Investor
Relations
One Penn
Center, 1617 JFK Blvd., Suite 660
Philadelphia,
PA 19103
Phone:
215-988-0080
Fax:
215-988-1739
Email:
ir@hemispherx.net
You
should rely only on the information incorporated by reference or provided in
this prospectus. We have not authorized anyone else to provide you with
different information. We will not make offers to sell these shares in any
jurisdiction where the offer is not permitted.
S-8
HEMISPHERX
BIOPHARMA, INC.
Common
Stock
PROSPECTUS
SUPPLEMENT
Maxim
Group LLC
May
28, 2010
$150,000,000
HEMISPHERX
BIOPHARMA, INC.
Common
Stock
Preferred
Stock
Warrants
Debt
Securities
This
prospectus relates to common stock, preferred stock, debt securities and
warrants to purchase common stock, preferred stock or debt securities, either
individually or in units, as well as common stock or preferred stock upon
conversion of debt securities, common stock upon conversion of preferred stock,
or common stock or preferred stock upon the exercise of warrants that we may
sell from time to time in one or more offerings up to a total public offering
price of $150,000,000 on terms to be determined at the time of sale. We will
provide specific terms of these securities in supplements to this prospectus. If
there is any inconsistency between the information in this prospectus and a
prospectus supplement, you should rely on the information in that prospectus
supplement. You should read this prospectus and any supplement carefully before
you invest.
This
prospectus may not be used to offer and sell securities unless accompanied by a
prospectus supplement for those securities.
See
“Risk Factors” beginning on page 4 for a discussion of material risks that you
should consider before you invest in our securities being sold with this
prospectus.
Our
common stock is traded on the NYSE Amex under the symbol “HEB.” On June 8,
2009, the last reported sale price for our common stock on the NYSE Amex was
$3.05 per share.
Neither
the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or passed upon the adequacy or
accuracy of this prospectus. Any representation to the contrary is a criminal
offense.
The date
of this prospectus is June 22, 2009.
TABLE
OF CONTENTS
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Page
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Prospectus
Summary
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2
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Risk
Factors
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4
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Special
Note Regarding Forward-Looking Statements
|
18
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Ratio
Of Earnings To Fixed Charges
|
19
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Use
of Proceeds
|
19
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PROSPECTUS
SUMMARY
Important
Notice about the Information Presented in this Prospectus
This
prospectus is part of a registration statement on Form S-3 that we filed with
the Securities and Exchange Commission, or SEC, utilizing a “shelf” registration
process. Under this shelf process, we may from time to time sell any combination
of securities described in this prospectus in one or more offerings. The
aggregate amount of securities that we may offer under the registration
statement is $150,000,000.
This
prospectus provides you with a general description of the securities we may
offer. Each time we sell securities, we will provide a prospectus supplement
that will contain specific information about the terms of the securities being
offered. That prospectus supplement may include a discussion of any risk factors
or other special consideration that apply to those securities. The prospectus
supplement may also add, update or change information contained in this
prospectus. If there is any inconsistency between the information in this
prospectus and a prospectus supplement, you should rely on the information in
that prospectus supplement. You should read both this prospectus and any
applicable prospectus supplement together with additional information described
under the heading “Where You Can Find More Information.”
When
acquiring any securities discussed in this prospectus, you should rely on the
information provided in this prospectus and the prospectus supplement, including
the information incorporated by reference. Neither we, nor any underwriters or
agents, have authorized anyone to provide you with different information. We are
not offering the securities in any state where such an offer is prohibited. You
should not assume that the information in this prospectus, any prospectus
supplement, or any document incorporated by reference, is truthful or complete
at any date other than the date mentioned on the cover page of those documents.
You should also carefully review the section entitled “Risk Factors,” which
highlights certain risks associated with an investment in our securities, to
determine whether an investment in our securities is appropriate for
you.
References
in this prospectus to “Hemispherx,” the “Company,” “we,” “us” and “our” are to
Hemispherx Biopharma, Inc.
About
Hemispherx
We are a
specialty pharmaceutical company engaged in the clinical development,
manufacture, marketing and distribution of new drug therapies based on natural
immune system enhancing technologies for the treatment of viral and immune based
chronic disorders. We were founded in the early 1970s doing contract
research for the National Institutes of Health. Since that time, we have
established a strong foundation of laboratory, pre-clinical, and clinical data
with respect to the development of nucleic acids to enhance the natural
antiviral defense system of the human body and to aid the development of
therapeutic products for the treatment of certain chronic
diseases.
2
Our
current strategic focus is derived from four applications of our two core
pharmaceutical technology platforms Ampligen® and Alferon N
Injection®. The commercial focus for Ampligen includes application as
a treatment for Chronic Fatigue Syndrome (“CFS”) and as a vaccine enhancer
(adjuvant) for both therapeutic and preventative vaccine
development. Alferon N Injection® is an FDA approved product with an
indication for refractory or recurring genital warts. Alferon LDO (Low Dose
Oral) is an application currently under early stage development targeting
influenza and viral diseases both as an adjuvant as well as a single entity
anti-viral.
Ampligen®
is an experimental drug currently undergoing clinical development for the
treatment of CFS. In August 2004, we completed a Phase III
clinical trial (“AMP 515”) treating CFS patients with Ampligen® and we are
presently in the registration process for a new drug application (“NDA”) with
the Food and Drug Administration (“FDA”). In July 2008, the FDA
accepted for review our NDA for Ampligen® to treat CFS. On February
18, 2009, we were notified by the FDA that the originally scheduled Prescription
Drug User Fee Act (“PDUFA”) date of February 25, 2009 has been extended to May
25, 2009. On May 22, 2009, we were notified by the FDA that it may
require up to one to two additional weeks to take action beyond the scheduled
PDUFA action date of May 25, 2009.
We own
and operate a 43,000 sq. ft. FDA approved facility in New Brunswick, New Jersey
primarily designed to produce Alferon N Injection®. In 2006, we
completed the installation of a polymer production line to produce Ampligen® raw
materials on a more reliable and consistent basis.
Our
principal executive offices are located at One Penn Center, 1617 JFK Boulevard,
Philadelphia, Pennsylvania 19103, and our telephone number is
215-988-0080. We maintain a website at
“http://www.hemispherx.net.” Information contained on our website is
not considered to be a part of, nor incorporated by reference in, this
prospectus.
3
RISK
FACTORS
The
following cautionary statements identify important factors that could cause our
actual results to differ materially from those projected in the forward-looking
statements made in this prospectus. Among the key factors that have a
direct bearing on our results of operations are:
Risks
Associated With Our Business
No
assurance of successful product development.
Ampligen®
and related products. The development of Ampligen® and
our other related products is subject to a number of significant
risks. Ampligen® may
be found to be ineffective or to have adverse side effects, fail to receive
necessary regulatory clearances, be difficult to manufacture on a commercial
scale, be uneconomical to market or be precluded from commercialization by
proprietary right of third parties. Our products are in various
stages of clinical and pre-clinical development and require further clinical
studies and appropriate regulatory approval processes before any such products
can be marketed. We do not know when, if ever, Ampligen® or
our other products will be generally available for commercial sale for any
indication. Generally, only a small percentage of potential
therapeutic products are eventually approved by the FDA for commercial
sale. Please see the next risk factor.
Alferon N
Injection®. Although Alferon N Injection® is approved for marketing
in the United States for the intra-lesional treatment of refractory or recurring
external genital warts in patients 18 years of age or older, to date it has not
been approved for other indications. We face many of the risks
discussed above, with regard to developing this product for use to treat other
ailments.
Our
drugs and related technologies are investigational and subject to regulatory
approval. If we are unable to obtain regulatory approval, our
operations will be significantly adversely affected.
All of
our drugs and associated technologies, other than Alferon N Injection®, are
investigational and must receive prior regulatory approval by appropriate
regulatory authorities for general use and are currently legally available only
through clinical trials with specified disorders. At present, Alferon
N Injection® is only approved for the intra-lesional treatment of refractory or
recurring external genital warts in patients 18 years of age or
older. Use of Alferon N Injection® for other indications will require
regulatory approval.
4
Our
products, including Ampligen®, are subject to extensive regulation by numerous
governmental authorities in the U.S. and other countries, including, but not
limited to, the FDA in the U.S., the Health Protection Branch (“HPB”) of Canada,
and the Agency for the Evaluation of Medicinal Products (“EMEA”) in
Europe. Obtaining regulatory approvals is a rigorous and lengthy
process and requires the expenditure of substantial resources. In
order to obtain final regulatory approval of a new drug, we must demonstrate to
the satisfaction of the regulatory agency that the product is safe and effective
for its intended uses and that we are capable of manufacturing the product to
the applicable regulatory standards. We require regulatory approval
in order to market Ampligen® or any other proposed product and receive product
revenues or royalties. We cannot assure you that Ampligen® will
ultimately be demonstrated to be safe or efficacious. In addition,
while Ampligen® is authorized for use in clinical trials including a cost
recovery program in the United States and Europe, we cannot assure you that
additional clinical trial approvals will be authorized in the United States or
in other countries, in a timely fashion or at all, or that we will complete
these clinical trials.
We filed
an NDA with the FDA for treatment of CFS on October 10, 2007. On
December 5, 2007 we received a Refusal to File letter from the FDA as our NDA
filing was deemed “not substantially complete”. We responded to the
FDA’s concerns by filing amendments to our NDA on April 25,
2008. These amendments should allow the FDA reviewers to better
evaluate independently the statistical efficacy/safety conclusions of our NDA
for the use of Ampligen® in treating CFS. On July 7, 2008, the FDA
accepted our NDA filing for review. However, there are no assurances
that upon review of the NDA that it will be approved by the FDA. On
February 18, 2009, we were notified by the FDA that the originally scheduled
PDUFA date of February 25, 2009 has been extended to May 25, 2009. On
May 22, 2009, we were notified by the FDA that it may require up to one to two
additional weeks to take action beyond the scheduled PDUFA action date of May
25, 2009.
If
Ampligen® or one of our other products does not receive regulatory approval in
the U.S. or elsewhere, our operations most likely will be materially adversely
affected.
Alferon®
LDO is undergoing pre-clinical testing for possible prophylaxis against avian
flu. Additional studies are anticipated for swine
H1N1. While the studies to date have been
encouraging. Preliminary testing in the laboratory and animals is not
necessarily predictive of successful results in clinical testing or human
treatment. No assurance can be given that similar results will be
observed in clinical trials. Use of Alferon® as a possible treatment
of avian flu requires prior regulatory approval. Only the FDA can
determine whether a drug is safe, effective or promising for treating a specific
application. As discussed in the prior risk factor, obtaining
regulatory approvals is a rigorous and lengthy process.
5
We
may continue to incur substantial losses and our future profitability is
uncertain.
We began
operations in 1966 and last reported net profit from 1985 through
1987. Since 1987, we have incurred substantial operating losses, as
we pursued our clinical trial effort to get our experimental drug, Ampligen®,
approved. As of March 31, 2009, our accumulated deficit was
approximately $200,496,000. We have not yet generated significant
revenues from our products and may incur substantial and increased losses in the
future. We cannot assure that we will ever achieve significant
revenues from product sales or become profitable. We require, and
will continue to require, the commitment of substantial resources to develop our
products. We cannot assure that our product development efforts will
be successfully completed or that required regulatory approvals will be obtained
or that any products will be manufactured and marketed successfully, or be
profitable.
We may require additional financing
which may not be available.
The
development of our products will require the commitment of substantial resources
to conduct the time-consuming research, preclinical development, and clinical
trials that are necessary to bring pharmaceutical products to
market. As of March 31, 2009, we had approximately $5,541,000 in cash
and cash equivalents and short-term investments. Since then, while we
have continued to spend cash on operations, through June 8, 2009, we received
approximately $1,440,000 of equity funding from Fusion Capital Fund II, LLC
during April and May 2009 and approximately $28,250,000 from recent placements
of shares and warrants and $5,782,450, from the exercise of warrants issued in
those placements. Given the harsh economic conditions, we have
reviewed every aspect of our operations for cost and spending reductions to
assure our long term survival while maintaining the resources necessary to
achieve our primary objectives of commercializing Alferon N, obtaining NDA
approval of Ampligen® and securing a strategic partner. Based on
these actions and our recent financings, we do not anticipate that we will need
additional financing in order to continue operations for the near
future.
Aside
from the sale of securities under this prospectus, we have in place one
potential sources of financing - the Common Stock Purchase Agreement (the
"Fusion Purchase Agreement") with Fusion Capital Fund II, LLC (“Fusion Capital”)
pursuant to which we have the right to sell shares of our Common Stock to Fusion
Capital.
If we are
unable to commercialize and sell Ampligen®, Alferon N Injection® or other
products, we eventually will need to secure other sources of funding through
additional equity or debt financing or from other sources in order to satisfy
our working capital needs and to complete the necessary clinical trials and the
regulatory approval processes including the commercializing of Ampligen®
products. We anticipate, but cannot assure, that, should we need to raise
additional funds, we will be able to do so from the sale of securities under
this prospectus and/or the sale of shares under the Fusion Purchase
Agreement. Pursuant to the Purchase Agreement, we only have the right
to receive $120,000 every two business days unless our stock price equals or
exceeds $0.80, in which case we can sell greater amounts to Fusion Capital as
the price of our common stock increases. Fusion Capital does not have
the right nor the obligation to purchase any shares of our common stock on any
business day that the market price of our common stock is less than
$0.40.
6
In
addition, as of June 8, 2009, we had approximately 42,000,000 shares authorized
but unissued and unreserved. At our annual stockholders’ meeting to
be held in June 2009, we are seeking approval of an amendment to our Certificate
of Incorporation to increase the number of authorized shares of Common Stock
from 200,000,000 to 350,000,000. If that approval is not obtained,
the amount of proceeds we may receive from the sale of our Common Stock will be
limited.
We
are unable to estimate the amount, timing or nature of future sales of
outstanding common stock or instruments convertible into or exercisable for our
common stock. Should we require additional financing and such
financing is unavailable or prohibitively expensive, our ability to develop our
products or continue our operations could be materially adversely
affected.
Our
Alferon N Injection® Commercial Sales have halted due to lack of finished goods
inventory.
Our
finished goods inventory of Alferon N Injection® reached it’s expiration date in
March 2008. As a result, we have no product to sell at this
time. The FDA declined to respond to our requests for an extension of
the expiration date, therefore we consider the request to be
denied. Since our testing of the product indicates that it is not
impaired and could be safely utilized, the finished goods inventory of 2,745
Alferon N Injection® 5ml vials may be used to produce approximately 11,000,000
sachets of Low Dose Oral Alferon (LDO) for future clinical trials.
Production
of Alferon N Injection® from our work-in-progress inventory, which has an
approximate expiration date of 2012, has been put on hold at this time due to
the resources needed to prepare our New Brunswick facility for the FDA
preapproval inspection with respect to our Ampligen® NDA. Work on the
Alferon N Injection® is expected to resume in mid-2009, which means that we may
not have any Alferon N Injection® product commercially available until
2010. However, if there is a significant absence of the product from
the market place, no assurance can be given that sales will return to prior
levels.
7
Although preliminary in vitro
testing indicates that Ampligen® enhances the effectiveness of different drug
combinations on avian influenza, preliminary testing in the laboratory is not
necessarily predictive of successful results in clinical testing or human
treatment.
Ampligen®
is currently being tested as a vaccine adjuvant for H5N1, a pathogenic avian
influenza virus (“HPAIV”) in Japan, where the preclinical data has shown
activity in preventing lethal challenge with the original virus used for
vaccination as well as the other related, but not identical, isolates of H5N1
virus (i.e., cross-reactivity). The clinical testing phase of
Ampligen® in Japan is expected to begin in late 2009 or early
2010. The results of laboratory testing with seasonal influenza virus
vaccine in Australia for the effect of Ampligen® as an adjuvant is
pending. No assurance can be given that similar results will be
observed in clinical trials. Use of Ampligen® in the treatment of flu
requires prior regulatory approval. Only the FDA can determine
whether a drug is safe, effective or promising for treating a specific
application. As discussed above, obtaining regulatory approvals is a
rigorous and lengthy process (see “Our drugs and related technologies
are investigational and subject to regulatory approval. If we are
unable to obtain regulatory approval, our operations will be significantly
adversely affected” above).
We
may not be profitable unless we can protect our patents and/or receive approval
for additional pending patents.
We need
to preserve and acquire enforceable patents covering the use of Ampligen® for a
particular disease in order to obtain exclusive rights for the commercial sale
of Ampligen® for such disease. We obtained all rights to Alferon N
Injection®, and we plan to preserve and acquire enforceable patents covering its
use for existing and potentially new diseases. Our success depends,
in large part, on our ability to preserve and obtain patent protection for our
products and to obtain and preserve our trade secrets and
expertise. Certain of our know-how and technology is not patentable,
particularly the procedures for the manufacture of our experimental drug,
Ampligen®, which is carried out according to standard operating procedure
manuals. We also have been issued patents on the use of Ampligen® in
combination with certain other drugs for the treatment of chronic Hepatitis B
virus, chronic Hepatitis C virus, and a patent which affords protection on the
use of Ampligen® in patients with Chronic Fatigue Syndrome. We have
not yet been issued any patents in the United States for the use of
AmpligenÒ as a sole
treatment for any of the cancers, which we have sought to
target. With regard to Alferon N Injection®, we have acquired from
ISI its patents for natural alpha interferon produced from human peripheral
blood leukocytes and its production process and we have filed a patent
application for the use of Alferon® LDO in treating viral diseases including
avian influenza. We cannot assure that our competitors will not seek and obtain
patents regarding the use of similar products in combination with various other
agents, for a particular target indication prior to our doing
such. If we cannot protect our patents covering the use of our
products for a particular disease, or obtain additional patents, we may not be
able to successfully market our products.
8
The
patent position of biotechnology and pharmaceutical firms is highly uncertain
and involves complex legal and factual questions.
To date,
no consistent policy has emerged regarding the breadth of protection afforded by
pharmaceutical and biotechnology patents. There can be no assurance
that new patent applications relating to our products or technology will result
in patents being issued or that, if issued, such patents will afford meaningful
protection against competitors with similar technology. It is
generally anticipated that there may be significant litigation in the industry
regarding patent and intellectual property rights. Such litigation
could require substantial resources from us and we may not have the financial
resources necessary to enforce the patent rights that we hold. No
assurance can be made that our patents will provide competitive advantages for
our products or will not be successfully challenged by
competitors. No assurance can be given that patents do not exist or
could not be filed which would have a materially adverse effect on our ability
to develop or market our products or to obtain or maintain any competitive
position that we may achieve with respect to our products. Our
patents also may not prevent others from developing competitive products using
related technology.
There
can be no assurance that we will be able to obtain necessary licenses if we
cannot enforce patent rights we may hold. In addition, the failure of
third parties from whom we currently license certain proprietary information or
from whom we may be required to obtain such licenses in the future, to
adequately enforce their rights to such proprietary information, could adversely
affect the value of such licenses to us.
If we
cannot enforce the patent rights we currently hold we may be required to obtain
licenses from others to develop, manufacture or market our
products. There can be no assurance that we would be able to obtain
any such licenses on commercially reasonable terms, if at all. We
currently license certain proprietary information from third parties, some of
which may have been developed with government grants under circumstances where
the government maintained certain rights with respect to the proprietary
information developed. No assurances can be given that such third
parties will adequately enforce any rights they may have or that the rights, if
any, retained by the government will not adversely affect the value of our
license.
There
is no guarantee that our trade secrets will not be disclosed or known by our
competitors.
To
protect our rights, we require certain employees and consultants to enter into
confidentiality agreements with us. There can be no assurance that
these agreements will not be breached, that we would have adequate and
enforceable remedies for any breach, or that any trade secrets of ours will not
otherwise become known or be independently developed by
competitors.
We
have limited marketing and sales capability. If we are unable to
obtain additional distributors and our current and future distributors do not
market our products successfully, we may not generate significant revenues or
become profitable.
We have
limited marketing and sales capability. We are dependent upon
existing and, possibly future, marketing agreements and third party distribution
agreements for our products in order to generate significant revenues and become
profitable. As a result, any revenues received by us will be
dependent in large part on the efforts of third parties, and there is no
assurance that these efforts will be successful.
9
Our
commercialization strategy for Ampligen®-CFS may include licensing/co-marketing
agreements utilizing the resources and capacities of a strategic
partner(s). We are currently seeking worldwide marketing partner(s),
with the goal of having a relationship in place before approval is
obtained. In parallel to partnering discussions, appropriate
pre-marketing activities will be undertaken. We intend to control
manufacturing of Ampligen on a world-wide basis.
We cannot
assure that our U.S. or foreign marketing strategy will be successful or that we
will be able to establish future marketing or third party distribution
agreements on terms acceptable to us, or that the cost of establishing these
arrangements will not exceed any product revenues. Our inability to
establish viable marketing and sales capabilities would most likely have a
materially adverse effect on us.
There
are no long-term agreements with suppliers of required materials. If
we are unable to obtain the required raw materials, we may be required to scale
back our operations or stop manufacturing Alferon N Injection® and/or
Ampligen®.
A number
of essential materials are used in the production of Alferon N Injection®,
including human white blood cells. We do not have long-term
agreements for the supply of any of such materials. There can be no
assurance we can enter into long-term supply agreements covering essential
materials on commercially reasonable terms, if at all.
There are
a limited number of manufacturers in the United States available to provide the
polymers for use in manufacturing Ampligen®. At present, we do not
have any agreements with third parties for the supply of any of these
polymers. We have established relevant manufacturing operations
within our New Brunswick, New Jersey facility for the production of Ampligen®
polymers from raw materials in order to obtain polymers on a more consistent
manufacturing basis.
If we are
unable to obtain or manufacture the required polymers, we may be required to
scale back our operations or stop manufacturing. The costs and availability of
products and materials we need for the production of Ampligen® and the
commercial production of Alferon N Injection® and other products which we may
commercially produce are subject to fluctuation depending on a variety of
factors beyond our control, including competitive factors, changes in
technology, and FDA and other governmental regulations and there can be no
assurance that we will be able to obtain such products and materials on terms
acceptable to us or at all.
10
There
is no assurance that successful manufacture of a drug on a limited scale basis
for investigational use will lead to a successful transition to commercial,
large-scale production.
Small
changes in methods of manufacturing, including commercial scale-up, may affect
the chemical structure of Ampligen® and other RNA drugs, as well as their safety
and efficacy, and can, among other things, require new clinical studies and
affect orphan drug status, particularly, market exclusivity rights, if any,
under the Orphan Drug Act. The transition from limited production of
pre-clinical and clinical research quantities to production of commercial
quantities of our products will involve distinct management and technical
challenges and will require additional management and technical personnel and
capital to the extent such manufacturing is not handled by third
parties. There can be no assurance that our manufacturing will be
successful or that any given product will be determined to be safe and
effective, capable of being manufactured economically in commercial quantities
or successfully marketed.
We
have limited manufacturing experience.
Ampligen®
has been produced to date only in limited quantities for use in our clinical
trials and we are dependent upon a third party supplier for the manufacturing
and bottling process. The failure to continue these arrangements or
to achieve other such arrangements on satisfactory terms could have a material
adverse affect on us. Also to be successful, our products must be
manufactured in commercial quantities in compliance with regulatory requirements
and at acceptable costs. To the extent we are involved in the
production process, our current facilities are not adequate for the production
of our proposed products for large-scale commercialization, and we currently do
not have adequate personnel to conduct large-scale manufacturing. We
intend to utilize third-party facilities if and when the need arises or, if we
are unable to do so, to build or acquire commercial-scale manufacturing
facilities. We will need to comply with regulatory requirements for
such facilities, including those of the FDA pertaining to current Good
Manufacturing Practices (“cGMP”) regulations. There can be no
assurance that such facilities can be used, built, or acquired on commercially
acceptable terms, or that such facilities, if used, built, or acquired, will be
adequate for our long-term needs.
We
may not be profitable unless we can produce Ampligen® or other products in
commercial quantities at costs acceptable to us.
We have
never produced Ampligen® or any other products in large commercial
quantities. We must manufacture our products in compliance with
regulatory requirements in large commercial quantities and at acceptable costs
in order for us to be profitable. We intend to utilize third-party
manufacturers and/or facilities if and when the need arises or, if we are unable
to do so, to build or acquire commercial-scale manufacturing
facilities. If we cannot manufacture commercial quantities of
Ampligen® or enter into third party agreements for its manufacture at costs
acceptable to us, our operations will be significantly
affected. Also, each production lot of Alferon N Injection® is
subject to FDA review and approval prior to releasing the lots to be
sold. This review and approval process could take considerable time,
which would delay our having product in inventory to sell.
11
Rapid
technological change may render our products obsolete or
non-competitive.
The
pharmaceutical and biotechnology industries are subject to rapid and substantial
technological change. Technological competition from pharmaceutical
and biotechnology companies, universities, governmental entities and others
diversifying into the field is intense and is expected to
increase. Most of these entities have significantly greater research
and development capabilities than us, as well as substantial marketing,
financial and managerial resources, and represent significant competition for
us. There can be no assurance that developments by others will not
render our products or technologies obsolete or noncompetitive or that we will
be able to keep pace with technological developments.
Our
products may be subject to substantial competition.
Ampligen®. Competitors
may be developing technologies that are, or in the future may be, the basis for
competitive products. Some of these potential products may have an
entirely different approach or means of accomplishing similar therapeutic
effects to products being developed by us. These competing products
may be more effective and less costly than our products. In addition,
conventional drug therapy, surgery and other more familiar treatments may offer
competition to our products. Furthermore, many of our competitors
have significantly greater experience than us in pre-clinical testing and human
clinical trials of pharmaceutical products and in obtaining FDA, HPB and other
regulatory approvals of products. Accordingly, our competitors may
succeed in obtaining FDA, HPB or other regulatory product approvals more rapidly
than us. There are no drugs approved for commercial sale with respect
to treating ME/CFS in the United States. The dominant competitors
with drugs to treat disease indications in which we plan to address include
Gilead Pharmaceutical, Pfizer, Bristol-Myers, Abbott Labs, GlaxoSmithKline,
Merck and Schering-Plough Corp. These potential competitors are among
the largest pharmaceutical companies in the world, are well known to the public
and the medical community, and have substantially greater financial resources,
product development, and manufacturing and marketing capabilities than we
have. Although we believe our principal advantage is the unique
mechanism of action of Ampligen® on the immune system, we cannot assure that we
will be able to compete.
12
ALFERON N
Injection®. Our competitors are among the largest pharmaceutical
companies in the world, are well known to the public and the medical community,
and have substantially greater financial resources, product development, and
manufacturing and marketing capabilities than we have. Alferon N
Injection® currently competes with Schering’s injectable recombinant alpha
interferon product (INTRON® A) for the treatment of genital warts. 3M
Pharmaceuticals also offer competition from its immune-response modifier,
Aldara®, a self-administered topical cream, for the treatment of external
genital and perianal warts. In addition, Medigene has FDA approval
for a self-administered ointment, VeregenTM, which is indicated for the topical
treatment of external genital and perianal warts. Alferon N
Injection® also competes with surgical, chemical, and other methods of treating
genital warts. We cannot assess the impact products developed by our
competitors, or advances in other methods of the treatment of genital warts,
will have on the commercial viability of Alferon N Injection®. If and
when we obtain additional approvals of uses of this product, we expect to
compete primarily on the basis of product performance. Our
competitors have developed or may develop products (containing either alpha or
beta interferon or other therapeutic compounds) or other treatment modalities
for those uses. There can be no assurance that, if we are able to
obtain regulatory approval of Alferon N Injection® for the treatment of new
indications, we will be able to achieve any significant penetration into those
markets. In addition, because certain competitive products are not
dependent on a source of human blood cells, such products may be able to be
produced in greater volume and at a lower cost than Alferon N
Injection®. Currently, our wholesale price on a per unit basis of
Alferon N Injection® is higher than that of the competitive recombinant alpha
and beta interferon products.
General. Other
companies may succeed in developing products earlier than we do, obtaining
approvals for such products from the FDA more rapidly than we do, or developing
products that are more effective than those we may develop. While we
will attempt to expand our technological capabilities in order to remain
competitive, there can be no assurance that research and development by others
or other medical advances will not render our technology or products obsolete or
non-competitive or result in treatments or cures superior to any therapy we
develop.
Possible
side effects from the use of Ampligen® or Alferon N Injection® could adversely
affect potential revenues and physician/patient acceptability of our
product.
Ampligen®. We
believe that Ampligen® has been generally well tolerated with a low incidence of
clinical toxicity, particularly given the severely debilitating or life
threatening diseases that have been treated. A mild flushing reaction
has been observed in approximately 15-20% of patients treated in our various
studies. This reaction is occasionally accompanied by a rapid heart
beat, a tightness of the chest, urticaria (swelling of the skin), anxiety,
shortness of breath, subjective reports of ''feeling hot'', sweating and
nausea. The reaction is usually infusion-rate related and can
generally be controlled by reducing the rate of infusion. Other
adverse side effects include liver enzyme level elevations, diarrhea, itching,
asthma, low blood pressure, photophobia, rash, transient visual disturbances,
slow or irregular heart rate, decreases in platelets and white blood cell
counts, anemia, dizziness, confusion, elevation of kidney function tests,
occasional temporary hair loss and various flu-like symptoms, including fever,
chills, fatigue, muscular aches, joint pains, headaches, nausea and
vomiting. These flu-like side effects typically subside within
several months. One or more of the potential side effects might deter
usage of Ampligen® in certain clinical situations and therefore, could adversely
affect potential revenues and physician/patient acceptability of our
product.
13
Alferon N
Injection®. At present, Alferon N Injection® is only approved for the
intra-lesional (within the lesion) treatment of refractory or recurring external
genital warts in adults. In clinical trials conducted for the
treatment of genital warts with Alferon N Injection®, patients did not
experience serious side effects; however, there can be no assurance that
unexpected or unacceptable side effects will not be found in the future for this
use or other potential uses of Alferon N Injection® which could threaten or
limit such product’s usefulness.
We
may be subject to product liability claims from the use of Ampligen®, Alferon N
Injection®, or other of our products which could negatively affect our future
operations. We have temporarily discontinued product liability
insurance.
We face
an inherent business risk of exposure to product liability claims in the event
that the use of Ampligen® or other of our products results in adverse
effects. This liability might result from claims made directly by
patients, hospitals, clinics or other consumers, or by pharmaceutical companies
or others manufacturing these products on our behalf. Our future
operations may be negatively affected from the litigation costs, settlement
expenses and lost product sales inherent to these claims. While we
will continue to attempt to take appropriate precautions, we cannot assure that
we will avoid significant product liability exposure.
On
November 28, 2008, we suspended product liability insurance for Alferon® N and
Ampligen® until we receive regulatory clearance for Ampligen®. We now
require third parties to indemnify us in conjunction with all overseas emergency
sales of Ampligen® and Alferon® LDO. We concluded that years of
successfully addressing the limited number of product liability claims filed
against Ampligen® and Alferon® LDO, combined with the mandatory patient waivers
completed as an element of clinical trials and lack of any commercial sales
since April 2008, that temporarily discontinuing the liability insurance was an
acceptable risk given our financial condition and need to conserve
cash.
Currently,
without product liability coverage for Ampligen® and Alferon® LDO, a claim
against the products could have a materially adverse effect on our business and
financial condition.
14
The
loss of services of key personnel including Dr. William A. Carter could hurt our
chances for success.
Our
success is dependent on the continued efforts of our staff, especially certain
doctors and researchers along with the continued efforts of Dr. William A.
Carter because of his position as a pioneer in the field of nucleic acid drugs,
his being the co-inventor of Ampligen®, and his knowledge of our overall
activities, including patents and clinical trials. The loss of the services of
personnel key to our operations or Dr. Carter could have a material adverse
effect on our operations and chances for success. As a cash conservation
measure, we have elected to discontinue the Key Man life insurance in the amount
of $2,000,000 on the life of Dr. Carter until we receive regulatory clearance
for Ampligen®. An employment agreement continues to exist with Dr. Carter that,
as amended, runs until December 31, 2010. However, Dr. Carter has the right to
terminate his employment upon not less than 30 days prior written notice. The
loss of Dr. Carter or other personnel or the failure to recruit additional
personnel as needed could have a materially adverse effect on our ability to
achieve our objectives.
Uncertainty
of health care reimbursement for our products.
Our
ability to successfully commercialize our products will depend, in part, on the
extent to which reimbursement for the cost of such products and related
treatment will be available from government health administration authorities,
private health coverage insurers and other organizations. Significant
uncertainty exists as to the reimbursement status of newly approved health care
products, and from time to time legislation is proposed, which, if adopted,
could further restrict the prices charged by and/or amounts reimbursable to
manufacturers of pharmaceutical products. We cannot predict what, if any,
legislation will ultimately be adopted or the impact of such legislation on us.
There can be no assurance that third party insurance companies will allow us to
charge and receive payments for products sufficient to realize an appropriate
return on our investment in product development.
There
are risks of liabilities associated with handling and disposing of hazardous
materials.
Our
business involves the controlled use of hazardous materials, carcinogenic
chemicals, flammable solvents and various radioactive compounds. Although we
believe that our safety procedures for handling and disposing of such materials
comply in all material respects with the standards prescribed by applicable
regulations, the risk of accidental contamination or injury from these materials
cannot be completely eliminated. In the event of such an accident or the failure
to comply with applicable regulations, we could be held liable for any damages
that result, and any such liability could be significant. We do not maintain
insurance coverage against such liabilities.
Risks
Associated With an Investment in Our Common Stock
The
market price of our stock may be adversely affected by market
volatility.
The
market price of our common stock has been and is likely to be volatile. This is
especially true given the current significant instability in the financial
markets. In addition to general economic, political and market conditions, the
price and trading volume of our stock could fluctuate widely in response to many
factors, including:
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announcements
of the results of clinical trials by us or our
competitors;
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adverse
reactions to products;
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governmental
approvals, delays in expected governmental approvals or withdrawals of any
prior governmental approvals or public or regulatory agency concerns
regarding the safety or effectiveness of our
products;
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changes
in U.S. or foreign regulatory policy during the period of product
development;
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developments
in patent or other proprietary rights, including any third party
challenges of our intellectual property
rights;
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announcements
of technological innovations by us or our
competitors;
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announcements
of new products or new contracts by us or our
competitors;
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actual
or anticipated variations in our operating results due to the level of
development expenses and other
factors;
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changes
in financial estimates by securities analysts and whether our earnings
meet or exceed the estimates;
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conditions
and trends in the pharmaceutical and other
industries;
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new
accounting standards;
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overall
investment market fluctuation; and
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occurrence
of any of the risks described in these "Risk
Factors."
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Our
common stock is listed for quotation on the NYSE Amex. For the 12-month period
ended April 30, 2009, the closing price of our common stock has ranged from
$0.25 to $1.20 per share. As of June 8, 2009, the last reported sale price for
our common stock on the NYSE Amex was $3.05 per share. We expect the price of
our common stock to remain volatile. The average daily trading volume of our
common stock varies significantly.
In the
past, following periods of volatility in the market price of the securities of
companies in our industry, securities class action litigation has often been
instituted against companies in our industry. If we face securities litigation
in the future, even if without merit or unsuccessful, it would result in
substantial costs and a diversion of management attention and resources, which
would negatively impact our business.
16
Our
stock price may be adversely affected if a significant amount of shares are sold
in the public market.
We have
registered $150,000,000 of securities for public sale pursuant to this
prospectus. In May 2009 we issued an aggregate of 25,543,339 shares and warrants
to purchase an additional 14,708,687 shares under a prior universal shelf
registration statement. In connection with entering into the Purchase Agreement
with Fusion Capital, we registered 21,300,000 shares in the aggregate,
consisting of 20,000,000 shares which we may sell to Fusion Capital and
1,300,000 shares we have issued or may issue to Fusion Capital as a commitment
fee. As of June 8, 2009, 2009, we have sold an aggregate of 6,642,632 shares to
Fusion Capital under the Purchase Agreement, leaving 14,657,368 shares. The sale
of a substantial number of shares of our common stock under this prospectus or
by Fusion Capital, or anticipation of such sales, could make it more difficult
for us to sell equity or equity-related securities in the future at a time and
at a price that we might otherwise wish to effect sales. However, we have the
right to control the timing and amount of any sales of our shares to Fusion
Capital and the agreement may be terminated by us at any time at our discretion
without any cost to us.
We also
previously registered 35% of 3,615,514 shares issuable upon exercise of warrants
related to our former convertible debentures and 14,442,294 shares issuable upon
exercise of certain other warrants. To the extent the exercise price of our
outstanding warrants is less than the market price of the common stock, the
holders of the warrants are likely to exercise them and sell the underlying
shares of common stock and to the extent that the exercise price of certain of
these warrants are adjusted pursuant to anti-dilution protection, the warrants
could be exercisable or convertible for even more shares of common stock. We
also may issue shares pursuant to this prospectus or otherwise to be used to
meet our capital requirements or use shares to compensate employees, consultants
and/or directors. We are unable to estimate the amount, timing or nature of
future sales of outstanding common stock or instruments convertible into or
exercisable for our common stock.
Sales of
substantial amounts of our common stock in the public market, including our sale
of securities under this Prospectus or pursuant to the Purchase Agreement with
Fusion Capital, could cause the market price for our common stock to decrease.
Furthermore, a decline in the price of our common stock would likely impede our
ability to raise capital through the issuance of additional shares of common
stock or other equity securities.
Provisions
of our Certificate of Incorporation and Delaware law could defer a change of our
management which could discourage or delay offers to acquire us.
Provisions
of our Certificate of Incorporation and Delaware law may make it more difficult
for someone to acquire control of us or for our stockholders to remove existing
management, and might discourage a third party from offering to acquire us, even
if a change in control or in management would be beneficial to our stockholders.
For example, our Certificate of Incorporation allows us to issue shares of
preferred stock without any vote or further action by our stockholders. Our
Board of Directors has the authority to fix and determine the relative rights
and preferences of preferred stock. Our Board of Directors also has the
authority to issue preferred stock without further stockholder approval. As a
result, our Board of Directors could authorize the issuance of a series of
preferred stock that would grant to holders the preferred right to our assets
upon liquidation, the right to receive dividend payments before dividends are
distributed to the holders of common stock and the right to the redemption of
the shares, together with a premium, prior to the redemption of our common
stock. In this regard, in November 2002, we adopted a stockholder rights plan
and, under the Plan, our Board of Directors declared a dividend distribution of
one Right for each outstanding share of Common Stock to stockholders of record
at the close of business on November 29, 2002. Each Right initially entitles
holders to buy one unit of preferred stock for $30.00. The Rights generally are
not transferable apart from the common stock and will not be exercisable unless
and until a person or group acquires or commences a tender or exchange offer to
acquire, beneficial ownership of 15% or more of our common stock. However, for
Dr. Carter, our Chief Executive Officer, who already beneficially owns 6.05% of
our common stock, the Plan’s threshold will be 20%, instead of 15%. The Rights
will expire on November 19, 2012, and may be redeemed prior thereto at $.01 per
Right under certain circumstances.
17
Because
the risk factors referred to above could cause actual results or outcomes to
differ materially from those expressed in any forward-looking statements made by
us, you should not place undue reliance on any such forward-looking statements.
Further, any forward-looking statement speaks only as of the date on which it is
made and we undertake no obligation to update any forward-looking statement or
statements to reflect events or circumstances after the date on which such
statement is made or reflect the occurrence of unanticipated events. New factors
emerge from time to time, and it is not possible for us to predict which will
arise. In addition, we cannot assess the impact of each factor on our business
or the extent to which any factor, or combination of factors, may cause actual
results to differ materially from those contained in any forward-looking
statements. Our research in clinical efforts may continue for the next several
years and we may continue to incur losses due to clinical costs incurred in the
development of Ampligen® for commercial application. Possible losses may
fluctuate from quarter to quarter as a result of differences in the timing of
significant expenses incurred and receipt of licensing fees and/or cost recovery
treatment revenue.
SPECIAL
NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain
statements in this prospectus constitute “forwarding-looking statements” within
the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities and Exchange Act of 1995 (collectively, the
“Reform Act”). Certain, but not necessarily all, of such forward-looking
statements can be identified by the use of forward-looking terminology such as
“believes,” “expects,” “may,” “will,” “should,” or “anticipates” or the negative
thereof or other variations thereon or comparable terminology, or by discussions
of strategy that involve risks and uncertainties. All statements other than
statements of historical fact, included in this prospectus regarding our
financial position, business strategy and plans or objectives for future
operations are forward-looking statements. Without limiting the broader
description of forward-looking statements above, we specifically note that
statements regarding potential drugs, their potential therapeutic effect, the
possibility of obtaining regulatory approval, our ability to manufacture and
sell any products, market acceptance or our ability to earn a profit from sales
or licenses of any drugs or our ability to discover new drugs in the future are
all forward-looking in nature.
18
Such
forward-looking statements involve known and unknown risks, uncertainties and
other factors, including but not limited to, the risk factors discussed above,
which may cause the actual results, performance or achievements of Hemispherx
and its subsidiaries to be materially different from any future results,
performance or achievements expressed or implied by such forward-looking
statements and other factors referenced in this prospectus. We do not undertake
and specifically decline any obligation to publicly release the results of any
revisions which may be made to any forward-looking statement to reflect events
or circumstances after the date of such statements or to reflect the occurrence
of anticipated or unanticipated events.
RATIO
OF EARNINGS TO FIXED CHARGES
We have
incurred $10.4 million in fixed charges in the past five years. Fixed charges
mainly represent interest expensed as well as amortized discounts related to
indebtedness. We have incurred losses totaling $20.9 million, $12.4 million,
$19.4 million, $18.1 million and $12.2 million for the years ended December 31,
2004, 2005, 2006, 2007 and 2008, respectively. Until we achieve profitability,
we will not be able to cover our fixed charges from earnings.
USE
OF PROCEEDS
Except as
otherwise provided in the applicable prospectus supplement, we intend to use the
net proceeds from the sale of the securities offered by this prospectus to fund
commercialization of Alferon® and Ampligen® along with general corporate
purposes, which may include working capital, capital expenditures, research and
development expenditures, regulatory affairs expenditures, clinical trial
expenditures, acquisitions of new technologies and investments, and the
repayment, refinancing, redemption or repurchase of future indebtedness or
capital stock. Additional information on the use of net proceeds from the sale
of securities offered by this prospectus may be set forth in the prospectus
supplement relating to that offering.
DESCRIPTION
OF CAPITAL STOCK
Our
authorized capital stock currently consists of 200,000,000 shares of common
stock, par value $0.001 per share, and 5,000,000 shares of preferred stock,
$0.01 par value per share. At our annual stockholders’ meeting to be held in
June 2009, we are seeking approval of an amendment to our Certificate of
Incorporation to increase the number of authorized shares of Common Stock from
200,000,000 to 350,000,000. No assurance can be given that stockholders will
approve the increase.
19
The
following summary of certain provisions of our common and preferred stock does
not purport to be complete. You should refer to our Amended and Restated
Certificate of Incorporation, amendments thereto, and our By laws, as amended,
all of which are filed with the SEC. The summary below is also qualified by
provisions of applicable law.
Common
Stock
Holders
of common stock are entitled to one vote per share on matters on which our
stockholders vote. There are no cumulative voting rights. Holders of common
stock are entitled to receive dividends, if declared by our board of directors,
out of funds that we may legally use to pay dividends. If we liquidate or
dissolve, holders of common stock are entitled to share ratably in our assets
once our debts and any liquidation preference owed to any then-outstanding
preferred stockholders are paid. All shares of common stock that are outstanding
as of the date of this prospectus are fully-paid and
non-assessable.
Preferred
Stock
We are
currently authorized to issue 5,000,000 shares of preferred stock, none of which
are currently outstanding.
Our board
of directors has the authority to designate any or all shares of preferred stock
in one or more series and to fix the rights of each series. Prior to issuance of
shares of each series, our Board of Directors will adopt resolutions and file a
certificate of designation fixing for each series the designations, powers,
preferences, conversion and other rights, voting powers, qualifications,
limitations as to dividends, restrictions and terms and conditions of
redemption. The preferred stock will, when issued, be fully paid and
nonassessable and will not have, or be subject to, any preemptive or similar
rights.
If we
sell preferred stock, the prospectus supplement relating to the series of
preferred stock offered by that supplement will describe the specific terms of
those securities, including:
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the
title and stated value of that preferred
stock;
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2.
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the
number of shares of that preferred stock offered, the liquidation
preference per share and the offering price of that preferred
stock;
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3.
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the
dividend rate(s), period(s) and/or payment date(s) or method(s) of
calculation thereof applicable to that preferred
stock;
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4.
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whether
dividends will be cumulative or non-cumulative and, if cumulative, the
date from which dividends on that preferred stock will
accumulate;
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5.
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the
voting rights applicable to that preferred
stock;
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6.
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the
procedures for any auction and remarketing, if any, for that preferred
stock;
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7.
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the
provisions for a sinking fund, if any, for that preferred
stock;
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8.
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the
provisions for redemption, if applicable, of that preferred
stock;
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9.
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any
listing of that preferred stock on any securities
exchange;
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10.
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the
terms and conditions, if applicable, upon which that preferred stock will
be convertible into shares of the Common Stock, including the conversion
price (or manner of calculation of the conversion price) and conversion
period;
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11.
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a
discussion of federal income tax considerations applicable to that
preferred stock;
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12.
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any
limitations on issuance of any series of preferred stock ranking senior to
or on a parity with that series of preferred stock as to dividend rights
and rights upon liquidation, dissolution or winding up of our affairs;
and
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13.
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any
other specific terms, preferences, rights, limitations or restrictions of
that preferred stock.
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We
believe the power to issue preferred stock will provide our board of directors
with flexibility in connection with certain possible corporate transactions. The
issuance of preferred stock, however, could adversely affect the voting power of
holders of our common stock, restrict their rights to receive payment upon
liquidation, and have the effect of delaying, deferring, or preventing a change
in control.
Transfer
Agent and Registrar
The
transfer agent and registrar for our common stock is Continental Stock Transfer
& Trust Company.
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DESCRIPTION
OF WARRANTS
The
following description of our warrants for the purchase of our common stock,
preferred stock and/or debt securities in this prospectus contains the general
terms and provisions of the warrants. The particular terms of any offering of
warrants will be described in a prospectus supplement relating to such offering.
The statements below describing the warrants are subject to and qualified by the
applicable provisions of our certificate of incorporation, bylaws and the
relevant provisions of the laws of the State of Delaware.
General
We may
issue warrants for the purchase of our common stock, preferred stock and/or debt
securities. We may issue warrants independently or together with any of our
securities, and warrants also may be attached to our securities or independent
of them. We may issue series of warrants under a separate warrant agreement
between us and a specified warrant agent described in the prospectus supplement.
The warrant agent will act solely as our agent in connection with the warrants
and will not assume any obligation or relationship of agency or trust for or
with any holders or beneficial owners of warrants.
Terms
A
prospectus supplement will describe the specific terms of any warrants that we
issue or offer, including:
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the
title of the warrants;
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the
aggregate number of warrants;
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the
price or prices at which the warrants will be
issued;
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the
currencies in which the price or prices of the warrants may be
payable;
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the
designation, amount and terms of our capital stock or debt securities
purchasable upon exercise of the
warrants;
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the
designation and terms of our other securities, if any, that may be issued
in connection with the warrants, and the number of warrants issued with
each corresponding security;
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if
applicable, the date that the warrants and the securities purchasable upon
exercise of the warrants will be separately
transferable;
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the
prices and currencies for which the securities purchasable upon exercise
of the warrants may be purchased;
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the
date that the warrants may first be
exercised;
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the
date that the warrants expire;
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the
minimum or maximum amount of warrants that may be exercised at any one
time;
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information
with respect to book-entry procedures, if
any;
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a
discussion of certain federal income tax considerations;
and
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any
other material terms of the warrants, including terms, procedures and
limitations relating to the exchange and exercise of the
warrants.
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Exercise
of Warrants
Each
warrant will entitle the holder to purchase for cash the principal amount of
debt securities or shares of preferred stock or common stock at the applicable
exercise price set forth in, or determined as described in, the applicable
prospectus supplement. Warrants may be exercised at any time up to the close of
business on the expiration date set forth in the applicable prospectus
supplement. After the close of business on the expiration date, unexercised
warrants will become void.
Warrants
may be exercised by delivering to the corporation trust office of the warrant
agent or any other officer indicated in the applicable prospectus supplement (a)
the warrant certificate properly completed and duly executed and (b) payment of
the amount due upon exercise. As soon as practicable following exercise, we will
forward the debt securities or shares of preferred stock or common stock
purchasable upon exercise. If less than all of the warrants represented by a
warrant certificate are exercised, a new warrant certificate will be issued for
the remaining warrants.
DESCRIPTION
OF DEBT SECURITIES
We
anticipate that any debt securities which we offer by this prospectus will be
issued under an indenture between us and a trustee to be identified in the
prospectus supplement. If a proposed debt transaction is not exempt under the
Trust Indenture Act of 1939, as amended (the “Trust Indenture Act”), the terms
of the debt securities will include those stated in the indenture and those made
part of the indenture by reference to the Trust Indenture Act, as in effect on
the date of the indenture. If a proposed transaction is exempt under the Trust
Indenture Act, we may not use an indenture (and, thus a trustee) or, if we use
an indenture, it may not fully comply with the requirements of the Trust
Indenture Act. The following description summarizes only the material provisions
of the indenture. Accordingly, you should read the form of indenture, a copy of
which has been filed as an exhibit to the registration statement of which this
prospectus forms a part, because it, and not this description, defines your
rights as holders of our debt securities. The following description also
provides general information that will be contained in any debt instrument we
may use if we do not use an indenture. You should also read the applicable
prospectus supplement for additional information and the specific terms of the
debt securities.
General
We may,
at our option, issue debt securities in one or more series from time to time.
“Debt securities” may include senior debt, senior subordinated debt or
subordinated debt. The particular terms of the debt securities offered by any
prospectus supplement, and the extent, if any, to which such general provisions
do not apply to the debt securities will be described in the prospectus
supplement relating to such debt securities. The following summaries set forth
certain general terms and provisions of the indenture and the debt securities.
The prospectus supplement relating to a series of debt securities being offered
will contain the following terms, if applicable:
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the
title and ranking;
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the
aggregate principal amount and any limit on such
amount;
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the
price at which such debt securities will be
issued;
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the
date on which the debt securities
mature;
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the
fixed or variable rate at which the debt securities will bear interest, or
the method by which such rate shall be
determined;
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the
timing, place and manner of making principal, interest and any premium
payments on the debt securities, and, if applicable, where such debt
securities may be surrendered for registration of transfer or
exchange;
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the
date or dates, if any, after which the debt securities may be converted or
exchanged into or for shares of our common stock, preferred stock or
another company’s securities or properties or cash and the terms of any
such conversion or exchange;
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any
redemption or early repayment
provisions;
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any
sinking fund or similar provisions;
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the
authorized denominations;
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any
applicable subordination
provisions;
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any
guarantees of such securities by our subsidiaries or
others;
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the
currency in which we will pay the principal, interest and any premium
payments on such debt securities;
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whether
the amount of payments of principal of (and premium, if any) or interest,
if any, on the debt securities may be determined with reference to an
index, formula or other method and the manner in which such amounts shall
be determined;
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the
time period within which, the manner in which and the terms and conditions
upon which the purchaser of the securities can select the payment
currency;
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the
provisions, if any, granting special rights to the holders of debt
securities upon certain events;
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any
additions to or changes in the events of default or covenants of
Hemispherx with respect to the debt securities and any change in the right
of the trustee or the holders to declare the principal, premium and
interest with respect to such securities to be due and
payable;
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whether
and under what circumstances we will pay any additional amounts on such
debt securities for any tax, assessment or governmental charge and, if so,
whether we will have the option to redeem such debt securities instead of
paying such amounts;
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the
form (registered and/or bearer securities), any restrictions applicable to
the offer, sale or delivery of bearer securities and the terms, if any,
upon which bearer securities may be exchanged for registered securities
and vice versa;
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the
date of any bearer securities or any global security, if other than the
date of original issuance of the first security of the series to be
issued;
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the
person to whom and manner in which any interest shall be
payable;
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whether
such securities will be issued in whole or in part in the form of one or
more global securities;
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the
identity of the depositary for global
securities;
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whether
a temporary security is to be issued with respect to such series and
whether any interest payable prior to the issuance of definitive
securities of the series will be credited to the account of the persons
entitled thereto;
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the
terms upon which beneficial interests in a temporary global security may
be exchanged in whole or in part for beneficial interests in a definitive
global security or for individual definitive securities and the terms upon
which such exchanges may be made;
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the
securities exchange(s), if any, on which the securities will be
listed;
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whether
any underwriter(s) will act as market maker(s) for the
securities;
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the
form (certificated or book-entry);
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the
form and/or terms of certificates, documents or conditions which may be
necessary, if any, for the debt securities to be issuable in final form;
and
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additional
terms not inconsistent with the provisions of the
indenture.
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One or
more series of debt securities may be sold at a substantial discount below their
stated principal amount bearing no interest or interest at a rate below the
market rate at the time of issuance. One or more series of debt securities may
be variable rate debt securities that may be exchanged for fixed rate debt
securities. In such cases, all material United States federal income tax and
other considerations applicable to any such series will be described in the
applicable prospectus supplement. You should consult with your own tax advisor
before making a decision to purchase any debt security.
We will
comply with Section 14(e) under the Exchange Act, to the extent applicable, and
any other tender offer rules under the Exchange Act, which may then be
applicable, in connection with any obligation of Hemispherx to purchase debt
securities at the option of the holders thereof. Any such obligation applicable
to a series of debt securities will be described in the applicable prospectus
supplement.
Exchange,
Registration, Transfer and Payment
We expect
payment of principal, premium, if any, and any interest on the debt securities
to be payable, and the exchange and the transfer of debt securities will be
registrable, at the office of the trustee or at any other office or agency we
maintain for such purpose. We expect to issue debt securities in denominations
of U.S. $1,000 or integral multiples thereof. No service charge will be made for
any registration of transfer or exchange of the debt securities, but we may
require a payment to cover any tax or other governmental charges payable in
connection therewith.
25
Global
Debt Securities
Unless we
indicate otherwise in the applicable prospectus supplement, the following
provisions will apply to all debt securities.
The debt
securities of a series may be issued in whole or in part in the form of one or
more global securities that will be deposited with a depositary that we will
identify in a prospectus supplement. Each global security will be deposited with
the depositary and will bear a legend regarding any related restrictions or
other matters as may be provided for pursuant to the applicable
indenture.
Unless a
prospectus supplement states otherwise, no global security may be transferred
to, or registered or exchanged for debt securities registered in the name of,
any person or entity other than the depositary, unless:
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the
depositary has notified us that it is unwilling or unable or is no longer
qualified to continue as
depositary;
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we
order the trustee that such global security shall be so transferable,
registrable and exchangeable, and such transfers shall be registrable;
or
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other
circumstances, if any, as may be described in the applicable prospectus
supplement.
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All debt
securities issued in exchange for a global security or any portion thereof will
be registered in such names as the depositary may direct. The specific terms of
the depositary arrangement with respect to any portion of a series of debt
securities to be represented by a global security will be described in the
applicable prospectus supplement.
Debt
securities which are to be represented by a global security to be deposited with
or on behalf of a depositary will be represented by a global security registered
in the name of such depositary or its nominee. Upon the issuance of such global
security, and the deposit of such global security with the depositary, the
depositary will credit, on its book-entry registration and transfer system, the
respective principal amounts of the debt securities represented by such global
security to the accounts of institutions that have accounts with such depositary
or its nominee (the “Participants”). The accounts to be credited will be
designated by the underwriters or agents of such debt securities or by us, if
such debt securities are offered and sold directly by us.
Ownership
of beneficial interests in such global security will be limited to Participants
or persons that may hold interests through Participants. Ownership of beneficial
interests in such global security will be shown on, and the transfer of that
ownership interest will be effected only through, records maintained by the
depositary or its nominee for such global security or by Participants or persons
that hold through Participants.
26
The laws
of some jurisdictions require that certain purchasers of securities take
physical delivery of such securities in certificated form. The foregoing
limitations and such laws may impair the ability to transfer beneficial
interests in such global securities.
So long
as the depositary, or its nominee, is the registered owner of such global
security, such depositary or such nominee, as the case may be, will be
considered the sole owner or holder of the debt securities represented by such
global security for all purposes under the indenture. Payment of principal of,
and premium and interest, if any, on debt securities will be made to the
depositary or its nominee as the registered owner or bearer as the case may be
of the global security representing such debt securities. Each person owning a
beneficial interest in such global security must rely on the procedures of the
depositary and, if such person is not a Participant, on the procedures of the
Participant through which such person owns its interest, to exercise any rights
of a holder under the indenture. If we request any action of holders or if an
owner of a beneficial interest in such global security desires to give any
notice or take any action a holder is entitled to give or take under the
indenture, the depositary will authorize the Participants to give such notice or
take such action, and Participants would authorize beneficial owners owning
through such Participants to give such notice or take such action or would
otherwise act upon the instructions of beneficial owners owning through
them.
The
rights of any holder of a debt security to receive payment of principal and
premium of, if any, and interest on such debt security, on or after the
respective due dates expressed or provided for in such debt security, or to
institute suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of the
holders.
Neither
we, the trustee, any paying agent nor the security registrar for such debt
securities will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests of the global security for such debt securities or for maintaining,
supervising or receiving any records relating to such beneficial ownership
interests.
We expect
that the depositary or its nominee, upon receipt of any payment of principal,
premium or interest, will credit immediately Participants’ accounts with
payments in amounts proportionate to their respective beneficial interests in
the principal amount of the global security for such debt securities as shown on
the records of such depositary or its nominee. We also expect that payments by
Participants to owners of beneficial interests in such global security held
through such Participants will be governed by standing instructions and
customary practices, as is now the case with securities held for the accounts of
customers in bearer form or registered in “street name,” and will be the
responsibility of such Participants.
27
If the
depositary for a global security representing debt securities of a particular
series is at any time unwilling or unable to continue as depositary and we do
not appoint a successor depositary within 90 days, we will issue debt securities
of such series in definitive form in exchange for such global security. In
addition, we may at any time and in our sole discretion determine not to have
the debt securities of a particular series represented by one or more global
securities and, in such event, will issue debt securities of such series in
definitive form in exchange for all of the global securities representing debt
securities of such series.
Covenants
Except as
permitted under “Consolidation, Merger and Sale of Assets,” the indenture will
require us to do or cause to be done all things necessary to preserve and keep
in full force and effect our existence and rights (declaration and statutory);
provided, however, that we shall not be required to preserve any right if we
determine that the preservation thereof is no longer desirable in the conduct of
our business and that the loss thereof is not disadvantageous in any material
respect to the holders of the debt securities.
The
indenture will require us to pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, all taxes, assessments and governmental
charges levied or imposed upon us except any tax, assessment, charge or claim
whose amount or applicability is being contested in good faith.
Reference
is made to the indenture and applicable prospectus supplement for information
with respect to any additional covenants specific to a particular series of debt
securities.
Consolidation,
Merger and Sale of Assets
Except as
set forth in the applicable prospectus supplement, the indenture will provide
that we shall not consolidate with, or sell, assign, transfer, lease or convey
all or substantially all of our assets, or merge into, to any person
unless:
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we
are the surviving entity or, in the event that we are not the surviving
entity, the entity formed by the transaction (in a consolidation) or the
entity which received the transfer of assets is a corporation organized
under the laws of any state of the United States or the District of
Columbia;
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such
entity assumes all of our obligations under the debt securities and the
indenture; and
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28
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immediately
after giving effect to the transaction, no event of default, as defined in
the indenture, shall have occurred and be
continuing.
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Notwithstanding
the foregoing, we may merge with another person or acquire by purchase or
otherwise all or any part of the property or assets of any other corporation or
person in a transaction in which we are the surviving entity.
Events
of Default
Unless
otherwise specified in the applicable prospectus supplement, the following are
events of default with respect to any series of debt securities issued under the
indenture:
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failure
to pay principal of any debt security of that series when due and payable
at maturity, upon acceleration, redemption or
otherwise;
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failure
to pay any interest on any debt security of that series when due, and the
default continues for 30 days;
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failure
to comply with any covenant or warranty contained in the indenture, other
than covenants or warranties contained in the indenture solely for the
benefit of other series of debt securities, and the default continues for
30 days after notice from the trustee or the holders of at least 25% in
principal amount of the then outstanding debt securities of that
series;
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certain
events of bankruptcy, insolvency or reorganization;
and
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any
other event of default provided with respect to that particular series of
debt securities.
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If an
event of default occurs and continues, then upon written notice to us the
trustee or the holders of at least 25% in principal amount of the outstanding
debt securities of that series may declare the unpaid principal amount of, and
any accrued and unpaid interest on, all debt securities of that series to be due
and payable immediately. However, at any time after a declaration of
acceleration with respect to debt securities of any series has been made, the
holders of a majority in principal amount of the outstanding debt securities of
that series may rescind and annul such acceleration:
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if
all events of default other than the nonpayment of principal of or
interest on the debt securities of that series which have become due
solely because of the acceleration have been waived or cured;
and
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the
rescission would not conflict with any judgment or decree of a court of
competent jurisdiction. For information as to waiver of defaults, see
“Amendment, Supplement and Waiver”
below.
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29
The
indenture will provide that, subject to the duty of the trustee during an event
of default to act with the required standard of care, the trustee will be under
no obligation to exercise any of its rights or powers under the indenture at the
request or direction of any of the holders, unless such holders shall have
offered to the trustee reasonable security or indemnity. Subject to certain
provisions, including those requiring security or indemnification of the
trustee, the holders of a majority in principal amount of the outstanding debt
securities of any series will have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the trustee, or
exercising any trust or power conferred on the trustee, with respect to the debt
securities of that series.
We will
be required to furnish to the trustee under the indenture annually a statement
as to the performance by us of our obligations under that indenture and as to
any default in such performance.
Discharge
of Indenture and Defeasance
Except as
otherwise set forth in the applicable prospectus supplement, we may terminate
our obligations under the debt securities of any series, and the corresponding
obligations under the indenture when:
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we
have paid or deposited with the trustee funds or United States government
obligations in an amount sufficient to pay at maturity all outstanding
debt securities of such series, including interest other than destroyed,
lost or stolen debt securities of such series which have not been replaced
or paid;
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all
outstanding debt securities of such series have been delivered (other than
destroyed, lost or stolen debt securities of such series which have not
been replaced or paid) to the trustee for cancellation;
or
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all
outstanding debt securities of any series have become due and payable;
and
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we
have paid all other sums payable under the
indenture.
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In
addition, we may terminate substantially all our obligations under the debt
securities of any series and the corresponding obligations under the indenture
if:
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we
have paid or deposited with the trustee, in trust an amount of cash or
United States government obligations sufficient to pay all outstanding
principal of and interest on the then outstanding debt securities of such
series at maturity or upon their redemption, as the case may
be;
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such
deposit will not result in a breach of, or constitute a default under, the
indenture;
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no
default or event of default shall have occurred and continue on the date
of deposit and no event of default as a result of a bankruptcy or event
which with the giving of notice or the lapse of time would become a
bankruptcy event of default shall have occurred and be continuing on the
91st day after such date;
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we
deliver to the trustee a legal opinion that we have received from, or
there has been published by, the United States Internal Revenue Service a
ruling, or there has been a change in tax law, in either case to the
effect that the holders of the debt securities of such series will not
recognize income, gain or loss for Federal income tax purposes as a result
of our exercise of such option and shall be subject to Federal income tax
on the same amounts and in the same manner and at the same times as would
have been the case if such option had not been exercised;
and
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certain
other conditions are met.
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We shall
be released from our obligations with respect to the covenants to deliver
reports required to be filed with the SEC and an annual compliance certificate,
and to make timely payments of taxes (including covenants described in a
prospectus supplement) and any event of default occurring because of a default
with respect to such covenants as they related to any series of debt securities
if:
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we
deposit or cause to be deposited with the trustee in trust an amount of
cash or United States government obligations sufficient to pay and
discharge when due the entire unpaid principal of and interest on all
outstanding debt securities of any
series;
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such
deposit will not result in a breach of, or constitute a default under, the
indenture;
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no
default or event of default shall have occurred and be continuing on the
date of deposit and no event of default as a result of a bankruptcy or
event which with the giving of notice or the lapse of time would become a
bankruptcy event of default shall have occurred and be continuing on the
91st day after such date;
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we
deliver to the trustee a legal opinion that the holders of the debt
securities of such series will not recognize income, gain or loss for
Federal income tax purposes as a result of our exercise of such option and
shall be subject to Federal income tax on the same amounts and in the same
manner and at the same times as would have been the case if such option
had not been exercised; and
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certain
other conditions are met.
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Upon
satisfaction of such conditions, our obligations under the indenture with
respect to the debt securities of such series, other than with respect to the
covenants and events of default referred to above, shall remain in full force
and effect.
Notwithstanding
the foregoing, no discharge or defeasance described above shall affect the
following obligations to or rights of the holders of any series of debt
securities:
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rights
of registration of transfer and exchange of debt securities of such
series;
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rights
of substitution of mutilated, defaced, destroyed, lost or stolen debt
securities of such series;
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rights
of holders of debt securities of such series to receive payments of
principal thereof and premium, if any, and interest thereon when
due;
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rights,
obligations, duties and immunities of the
trustee;
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31
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rights
of holders of debt securities of such series as beneficiaries with respect
to property deposited with the trustee and payable to all or any of them;
and
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our
obligations to maintain an office or agency in respect of the debt
securities of such series.
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Transfer
and Exchange
A holder
of debt securities may transfer or exchange such debt securities in accordance
with the indenture. The registrar for the debt securities may require a holder,
among other things, to furnish appropriate endorsements and transfer documents,
and to pay any taxes and fees required by law or permitted by the indenture. The
registrar is not required to transfer or exchange any debt security selected for
redemption or any debt security for a period of 15 days before a selection of
debt security to be redeemed.
The
registered holder of a debt security may be treated as the owner of such
security for all purposes.
Amendment,
Supplement and Waiver
Subject
to certain exceptions, the terms of the indenture or the debt securities may be
amended or supplemented by us and the trustee with the written consent of the
holders of at least a majority in principal amount of the outstanding debt
securities of each series affected by the amendment with each series voting as a
separate class. Without the consent of any holder of the debt securities, we and
the trustee may amend the terms of the indenture or the debt securities
to:
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cure
any ambiguity, defect or
inconsistency;
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provide
for the assumption of our obligations to holders of the debt securities by
a successor corporation;
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provide
for uncertificated debt securities in addition to certificated debt
securities;
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make
any change that does not adversely affect the rights of any holder of the
debt securities in any material respect;
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add
to, change or eliminate any other provisions of the indenture in respect
of one or more series of debt securities if such change would not (i)
apply to any security of any series created prior to the execution of a
supplemental indenture and entitled to the benefit of such provision and
(ii) modify the rights of the holder of any such security with respect to
such provision or become effective only when there is no outstanding
security of any series created prior to the execution of such supplemental
indenture and entitled to such
benefits;
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establish
any additional series of debt securities;
or
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comply
with any requirement of the SEC in connection with the qualification of
the indenture under the Trust Indenture
Act.
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32
However,
holders of each series of debt securities affected by a modification must
consent to modifications that have the following effect:
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reduce
the principal amount of debt securities the holders of which must consent
to an amendment, supplement or waiver of any provision of the
indenture;
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reduce
the rate or change the time for payment of interest on any debt
security;
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reduce
the principal of or change the fixed maturity of any debt
securities;
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change
the date on which any debt security may be subject to redemption or
repurchase, or reduce the redemption or repurchase price
therefor;
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make
any debt security payable in currency other than that stated in the debt
security;
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·
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waive
any existing default or event of default and the consequences with respect
to that series;
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modify
the right of any holder to receive payment of principal or interest on any
debt security on or after the respective due dates expressed or provided
for in the debt security;
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impair
the right of any holder to institute suit for the enforcement of any
payment in or with respect to any such debt security;
or
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·
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make
any change in the foregoing amendment provisions which require each
holder’s consent.
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Any
existing default may be waived with the consent of the holders of at least a
majority in principal amount of the then outstanding debt securities of the
series affected thereby.
The
consent of the holders of debt securities is not necessary to approve the
particular form of any proposed amendment to any indenture. It is sufficient if
any consent approves the substance of the proposed amendment.
Replacement
Securities
Any
mutilated certificate representing a debt security or a certificate representing
a debt security with a mutilated coupon will be replaced by us at the expense of
the holder upon surrender of such certificate to the trustee. Certificates
representing debt securities or coupons that become destroyed, stolen or lost
will be replaced by us at the expense of the holder upon delivery to us and the
trustee of evidence of any destruction, loss or theft satisfactory to us and the
trustee, provided that neither we nor the trustee has been notified that such
certificate or coupon has been acquired by a bona fide purchaser. In the case of
any coupon which becomes destroyed, stolen or lost, such coupon will be replaced
by issuance of a new certificate representing the debt security in exchange for
the certificate representing the debt security to which such coupon appertains.
In the case of a destroyed, lost or stolen certificate representing the debt
security or coupon, an indemnity bond satisfactory to the trustee and us may be
required at the expense of the holder of such debt security before a replacement
certificate will be issued.
33
Regarding
the Trustee
We will
identify in the prospectus supplement relating to any series of debt securities
the trustee with respect to such series. The indenture and provisions of the
Trust Indenture Act incorporated by reference therein contain certain
limitations on the rights of the trustee, should it become a creditor of
Hemispherx, to obtain payment of claims in certain cases, or to realize on
certain property received in respect of any such claim, as security or
otherwise. The trustee and its affiliates may engage in, and will be permitted
to continue to engage in, other transactions with us and our affiliates;
provided, however, that if it acquires any conflicting interest, as defined in
the Trust Indenture Act, it must eliminate such conflict or resign.
The
holders of a majority in principal amount of the then outstanding debt
securities of any series will have the right to direct the time, method and
place of conducting any proceeding for exercising any remedy available to the
trustee. The Trust Indenture Act and the indenture provide that in case an event
of default shall occur, and be continuing, the trustee will be required, in the
exercise of its rights and powers, to use the degree of care and skill of a
prudent man in the conduct of his own affairs. Subject to such provision, the
trustee will be under no obligation to exercise any of its rights or powers
under the indenture at the request of any of the holders of the debt securities
issued thereunder, unless they have offered to the trustee indemnity
satisfactory to it.
Governing
Law
The debt
securities will be governed by and construed in accordance with the laws of the
State of New York.
34
PLAN
OF DISTRIBUTION
We may
sell the securities registered under this prospectus:
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through
underwriting syndicates represented by one or more managing
underwriters;
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to
or through underwriters or dealers;
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through
agents;
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directly
to one or more purchasers;
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through
a block trade in which the broker or dealer engaged to handle the block
trade will attempt to sell the securities as agent, but may position and
resell a portion of the block as principal to facilitate the transaction;
or
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through
a combination of any of these methods of
sale.
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We may,
from time to time, authorize underwriters acting as our agents to offer and sell
the securities upon the terms and conditions as are set forth in the applicable
prospectus supplement. We will describe the name or names of any underwriters
and the purchase price of the securities in a prospectus supplement relating to
the securities. Any underwritten offering may be on a best efforts or a firm
commitment basis. The obligations, if any, of the underwriter to purchase any
securities will be subject to certain conditions.
If a
dealer is used in an offering of securities, we may sell the securities to the
dealer as principal. We will describe the name or names of any dealers and the
purchase price of the securities in a prospectus supplement relating to the
securities. The dealer may then resell the securities to the public at varying
prices to be determined by the dealer at the time of sale. Any public offering
price and any discounts or concessions allowed, re-allowed, or paid to dealers
may be changed from time to time and will be described in a prospectus
supplement relating to the securities.
We, or
any underwriter, dealer or agent, may distribute the securities from time to
time in one or more transactions at:
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a
fixed price or prices, which may be
changed;
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at
market prices prevailing at the time of
sale;
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at
prices related to prevailing market prices;
or
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at
negotiated prices.
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Any of
these prices may represent a discount from the prevailing market
prices.
35
To the
extent permitted by and in accordance with Regulation M under the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), in connection with an
offering an underwriter may engage in over-allotments, stabilizing transactions,
short covering transactions and penalty bids. Over-allotments involve sales in
excess of the offering size, which creates a short position. Stabilizing
transactions permit bids to purchase the underlying security so long as the
stabilizing bids do not exceed a specified maximum. Short covering transactions
involve purchases of the securities in the open market after the distribution is
completed to cover short positions. Penalty bids permit the underwriters to
reclaim a selling concession from a dealer when the securities originally sold
by the dealer are purchased in a covering transaction to cover short positions.
Those activities may cause the price of the securities to be higher than it
would be otherwise. If commenced, the underwriters may discontinue any of these
activities at any time. We will describe any of these activities in the
prospectus supplement.
We may
authorize underwriters, dealers or agents to solicit offers by certain
institutions to purchase our securities at the public offering price under
delayed delivery contracts. If we use delayed delivery contracts, we will
disclose that we are using them in the prospectus supplement and will tell you
when we will demand payment and delivery of the securities under the delayed
delivery contracts. These delayed delivery contracts will be subject only to the
conditions that we set forth in the prospectus supplement. We will indicate in
our prospectus supplement the commission that underwriters and agents soliciting
purchases of our securities under delayed delivery contracts will be entitled to
receive.
In
connection with the sale of the securities and as further set forth in an
applicable prospectus supplement, underwriters may receive compensation from us
or from purchasers of the securities for whom they may act as agents, in the
form of discounts, concessions or commissions. Underwriters may sell the
securities to or through dealers, and these dealers may receive compensation in
the form of discounts, concessions or commissions from the underwriters and/or
commissions from the purchasers for whom they may act as agents. Underwriters,
dealers and agents that participate in the distribution of the securities may be
deemed to be underwriters, and any discounts or commissions they receive from
us, and any profit on the resale of the securities they realize, may be deemed
to be underwriting discounts and commissions under the Securities Act of 1933,
as amended (the “Securities Act”). The prospectus supplement will identify any
underwriter or agent and will describe any compensation they receive from
us.
Unless
otherwise specified in the prospectus supplement, each series of the securities
will be a new issue with no established trading market, other than our common
stock, which is currently listed on the NYSE Amex. We will apply to the NYSE
Amex to list any additional shares of common stock that we offer and sell
pursuant to a prospectus supplement. To the extent permitted by and in
accordance with Regulation M under the Exchange Act, any underwriters who are
qualified market makers on the NYSE Amex may engage in passive market making
transactions in the securities on the NYSE Amex during the business day prior to
the pricing of an offering, before the commencement of offers or sales of the
securities. Passive market makers must comply with applicable volume and price
limitations and must be identified as passive market makers. In general, a
passive market maker must display its bid at a price not in excess of the
highest independent bid for such security; if all independent bids are lowered
below the passive market maker’s bid, however, the passive market maker’s bid
must then be lowered when certain purchase limits are exceeded. It is possible
that one or more underwriters may make a market in our securities, but
underwriters will not be obligated to do so and may discontinue any market
making at any time without notice. Therefore, we can give no assurance about the
liquidity of our securities that may be sold pursuant to this
prospectus.
36
Under
agreements we may enter into, we may indemnify underwriters, dealers and agents
who participate in the distribution of the securities against certain
liabilities, including liabilities under the Securities Act.
Certain
of the underwriters, dealers and agents and their affiliates may be customers
of, engage in transactions with, and perform services for us and our
subsidiaries from time to time in the ordinary course of business. Any such
relationships will be disclosed in an applicable prospectus
supplement.
If
indicated in the prospectus supplement, we will authorize underwriters or other
persons acting as our agents to solicit offers by institutions to purchase
securities from us pursuant to contracts providing for payment and delivery on a
future date. Institutions with which we may make these contracts include
commercial and savings banks, insurance companies, pension funds, investment
companies, educational and charitable institutions and others. The obligations
of any purchaser under any such contract will be subject to the condition that
the purchase of the securities shall not at the time of delivery be prohibited
under the laws of the jurisdiction to which the purchaser is subject. The
underwriters and other agents will not have any responsibility with regard to
the validity or performance of these contracts.
LEGAL
MATTERS
The
validity of the securities offered in this prospectus will be passed upon for us
by Silverman Sclar Shin & Byrne PLLC, New York, New York.
EXPERTS
The
financial statements, the related financial statement schedule, and the
effectiveness of internal control over financial reporting incorporated by
reference in this Prospectus and Registration Statement have been audited by
McGladrey & Pullen, LLP, an independent registered public accounting firm,
as stated in their report incorporated herein by reference, and are incorporated
in reliance upon such report and upon the authority of such firm as experts in
accounting and auditing.
37
WHERE
YOU CAN FIND MORE INFORMATION
This
prospectus is part of a registration statement on Form S-3 that we filed with
the SEC. This prospectus does not contain all of the information included in the
registration statement. For further information about us and our securities, you
should refer to the registration statement and the exhibits filed with the
registration statement.
We are
subject to the information requirements of the Securities Exchange Act of 1934
and file annual, quarterly and current reports, proxy statements and other
information with the SEC. You can read our SEC filings, including the
registration statement, over the Internet at the SEC’s website at www.sec.gov or through our
website at www.hemispherx.net. Information
contained on our website is not considered to be a part of, nor incorporated by
reference in, this prospectus. You may also read and copy any document we file
with the SEC at its Public Reference Room at 100 F Street, NE, Washington, D.C.
20549.
You may
also obtain copies of the documents at prescribed rates by writing to the Public
Reference Room of the SEC at 100 F Street, NE, Washington, D.C. 20549. Please
call the SEC at 1-800-SEC-0330 for further information on the operation of the
Public Reference Room.
INFORMATION
INCORPORATED BY REFERENCE
The SEC
allows us to “incorporate by reference” the information that we file with them,
which means that we can disclose important information to you by referring you
to those documents. The information incorporated by reference is
considered to be an important part of this prospectus, and later information
that we file with the SEC will automatically update and supersede this
information. We incorporate by reference the following documents and
any future filing made with the SEC under Sections 13(a), 13(c), 14 or 15(d) of
the Securities Exchange Act of 1934 prior to the termination of the
offering:
|
(a)
|
Our
annual report on Form 10-K for our fiscal year ended December 31, 2008,
SEC File No. 1-13441.
|
|
(b)
|
Our
quarterly report on Form 10-Q for the period ended March 31, 2009, SEC
File No. 1-13441.
|
|
(c)
|
Our
current reports on Form 8-K, SEC File No. 1-13441 filed with the SEC on
June 17, 2009, May 27, 2009, May 26, 2009, May 19, 2009 and February 19,
2009.
|
38
|
(d)
|
Our
proxy statement on schedule 14A for our 2009 annual meeting, SEC File No.
1-13441.
|
You may
request a copy of these filings, at no cost, by writing or telephoning us at the
following address: Hemispherx Biopharma, Inc., 1617 JFK Boulevard, Philadelphia,
Pennsylvania 19103, telephone number 215-988-0080.
You
should rely only on the information incorporated by reference or provided in
this prospectus or any supplement. We have not authorized anyone else
to provide you with different information. We will not make offers to
sell these shares in any state where the offer is not permitted. You
should not assume that the information in this prospectus or any supplement is
accurate as of any date other that the date on the front of those
documents.
39
HEMISPHERX
BIOPHARMA, INC.
$150,000,000
Common
Stock
Preferred
Stock
Warrants
Debt
Securities
PROSPECTUS
June 22,
2009