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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2002
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 000-26534
VION PHARMACEUTICALS, INC.
(Exact name of registrant as specified in its charter)
Delaware 13-3671221
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)
4 Science Park
New Haven, CT 06511
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (203) 498-4210
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]
The number of shares outstanding of the registrant's Common Stock as of November
4, 2002 was 28,891,686.
Page 1
PART I
FINANCIAL INFORMATION
ITEM 1. Financial Statements
Vion Pharmaceuticals, Inc.
(A Development Stage Company)
Balance Sheet
September 30, December 31,
(In thousands, except share and per share data) 2002 2001
- ----------------------------------------------------------------------------------------------------------------------------
(Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $ 12,947 $ 6,645
Short-term investments -- 15,999
-------------------------------
Total cash, cash equivalents and short-term investments 12,947 22,644
Interest receivable 13 193
Accounts receivable 52 54
Other current assets 99 130
-------------------------------
Total current assets 13,111 23,021
Property and equipment, net 507 550
Security deposits 29 30
-------------------------------
Total assets $ 13,647 $ 23,601
===============================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued expenses $ 2,319 $ 2,503
-------------------------------
Total current liabilities 2,319 2,503
-------------------------------
Shareholders' Equity:
Preferred stock, $0.01 par value, authorized: 5,000,000 shares;
issued and outstanding: none -- --
Common stock, $0.01 par value, authorized: 100,000,000 shares;
issued and outstanding: 28,891,686 and 28,873,373 shares
at September 30, 2002 and December 31, 2001, respectively 289 289
Additional paid-in-capital 112,422 112,377
Accumulated other comprehensive loss -- (6)
Accumulated deficit (101,383) (91,562)
-------------------------------
11,328 21,098
-------------------------------
Total liabilities and shareholders' equity $ 13,647 $ 23,601
===============================
The accompanying notes are an integral part of these financial statements.
Page 2
Vion Pharmaceuticals, Inc.
(A Development Stage Company)
Statement of Operations
(Unaudited)
For the Period from
For the Three Months For the Nine Months May 1, 1994
Ended Ended (Inception)
September 30, September 30, through
(In thousands, except per share data) 2002 2001 2002 2001 September 30, 2002
- ------------------------------------- ---- ---- ---- ---- ------------------
Revenues:
Contract research grants $ 66 $ 153 $ 122 $ 426 $ 2,134
Technology license fees -- 69 28 121 4,432
Laboratory support services 8 -- 8 -- 125
Research support -- -- -- -- 5,498
------- ------- -------- -------- ---------
Total revenues 74 222 158 547 12,189
------- ------- -------- -------- ---------
Operating expenses:
Research and development 1,009 2,515 4,584 6,941 57,543
Clinical trials 1,129 871 3,877 2,687 20,347
------- ------- -------- -------- ---------
Total research and development 2,138 3,386 8,461 9,628 77,890
General and administrative 486 797 2,180 2,568 21,645
------- ------- -------- -------- ---------
Total operating expenses 2,624 4,183 10,641 12,196 99,535
------- ------- -------- -------- ---------
Interest income (67) (266) (435) (995) (4,688)
Interest expense -- -- -- -- 208
------- ------- -------- -------- ---------
Loss before income tax benefit (2,483) (3,695) (10,048) (10,654) (82,866)
Income tax benefit -- -- (227) -- (227)
------- ------- -------- -------- ---------
Net loss (2,483) (3,695) (9,821) (10,654) (82,639)
Preferred stock dividends and accretion -- -- -- -- (18,489)
------- ------- -------- -------- ---------
Loss applicable to common shareholders $(2,483) $(3,695) $ (9,821) $(10,654) $(101,128)
======= ======= ======== ======== =========
Loss applicable to common shareholders
per share $ (0.09) $ (0.13) $ (0.34) $ (0.40)
======= ======= ======== ========
Weighted-average number of shares of
common stock outstanding 28,892 27,593 28,886 26,658
======= ======= ======== ========
The accompanying notes are an integral part of these financial statements.
Page 3
Vion Pharmaceuticals, Inc.
(A Development Stage Company)
Statement of Changes in Shareholders' Equity
Class A
Convertible Additional
Preferred Stock Common Stock Paid-in
(In thousands, except share data) Shares Amount Shares Amount Capital
- ---------------------------------------------------------------------------------------------------------
Balance at December 31, 1999 498,194 $ 5 18,242,119 $182 $ 68,012
Conversion of Class A convertible
preferred stock (502,928) (5) 1,397,035 14 (9)
Redemption of Class A convertible
preferred stock (545) -- (5)
Class A convertible preferred stock 5,279 -- 248
dividend
Series 1998 convertible preferred
stock accretion
Conversion of Series 1998
convertible preferred stock 1,507,024 15 5,523
Exercise of stock options 650,409 7 2,868
Exercise of warrants 4,371,055 44 23,270
Compensation associated with stock options 120
Amortization of deferred compensation
Change in net unrealized gains and losses
Net loss
-----------------------------------------------------------
Balance at December 31, 2000 -- $-- 26,167,642 $262 $100,027
-----------------------------------------------------------
Issuance of common stock 2,500,000 25 11,386
Exercise of stock options 191,527 2 777
Exercise of warrants 4,015 -- 14
Compensation associated with stock options 111
Issuances under employee benefit plans 10,189 -- 62
Change in net unrealized gains and losses
Net loss
-----------------------------------------------------------
Balance at December 31, 2001 -- $-- 28,873,373 $289 $112,377
-----------------------------------------------------------
Exercise of stock options 10,395 -- 32
Issuances under employee benefit plans 7,918 -- 13
Change in net unrealized gains and losses
Net loss
-----------------------------------------------------------
Balance at September 30, 2002 (unaudited) -- $-- 28,891,686 $289 $112,422
===========================================================
Accumulated
Other Total
Deferred Comprehensive Accumulated Shareholders'
(In thousands, except share data) Compensation Income (Loss) Deficit Equity
- ---------------------------------------------------------------------------------------------------------
Balance at December 31, 1999 $(3) $ -- $ (62,343) $ 5,853
Conversion of Class A convertible
preferred stock --
Redemption of Class A convertible
preferred stock (5)
Class A convertible preferred stock
dividend (248) --
Series 1998 convertible preferred
stock accretion (358) (358)
Conversion of Series 1998
convertible preferred stock 5,538
Exercise of stock options 2,875
Exercise of warrants 23,314
Compensation associated with stock options 120
Amortization of deferred compensation 3 3
Change in net unrealized gains and losses 120 120
Net loss (14,803) (14,803)
-----------------------------------------------------------
Balance at December 31, 2000 $-- $ 120 $ (77,752) $ 22,657
-----------------------------------------------------------
Issuance of common stock 11,411
Exercise of stock options 779
Exercise of warrants 14
Compensation associated with stock options 111
Issuances under employee benefit plans 62
Change in net unrealized gains and losses (126) (126)
Net loss (13,810) (13,810)
-----------------------------------------------------------
Balance at December 31, 2001 $-- $ (6) $ (91,562) $ 21,098
-----------------------------------------------------------
Exercise of stock options 32
Issuances under employee benefit plans 13
Change in net unrealized gains and losses 6 6
Net loss (9,821) (9,821)
-----------------------------------------------------------
Balance at September 30, 2002 (unaudited) $-- $ -- $(101,383) $ 11,328
===========================================================
The accompanying notes are an integral part of these financial statements.
Page 4
Vion Pharmaceuticals, Inc.
(A Development Stage Company)
Statement of Cash Flows
For The Period From
May 1, 1994
For the Nine Months Ended (Inception) through
September 30, September 30,
(In thousands) 2002 2001 2002
- ------------------------------------------------------------------------------------------------------------------
(Unaudited) (Unaudited)
Cash flows from operating activities:
Net loss $(9,821) $(10,654) $(82,639)
Adjustments to reconcile net loss to net cash used
in operating activities-
Depreciation and amortization 182 220 2,363
Loss on fixed asset disposals -- 4 4
(Increase) decrease in receivables and other
current assets 213 298 (163)
(Increase) decrease in other assets 1 -- (26)
Increase (decrease) in accounts payable and accrued
expenses (184) 29 2,284
Non-cash compensation -- 111 1,068
Purchased research and development -- -- 4,481
Stock issued for services -- -- 600
Amortization of financing costs -- -- 346
Extension/reissuance of placement agent warrants -- -- 168
-----------------------------------------------
Net cash used in operating activities (9,609) (9,992) (71,514)
-----------------------------------------------
Cash flows from investing activities:
Purchases of marketable securities (2,297) (15,529) (83,351)
Maturities of marketable securities 18,302 18,046 83,351
Acquisition of property and equipment (139) (259) (1,930)
-----------------------------------------------
Net cash provided by (used in) investing activities 15,866 2,258 (1,930)
-----------------------------------------------
Cash flows from financing activities:
Net proceeds from issuance of common stock 45 12,146 33,864
Net proceeds from exercise of placement agent
warrants -- 15 115
Net proceeds from issuance of preferred stock -- -- 20,716
Net proceeds from exercise of Class A Warrants -- -- 5,675
Net proceeds from exercise of Class B Warrants -- -- 17,538
Initial public offering -- -- 9,696
Repayment of equipment capital leases -- (6) (927)
Other financing activities, net -- -- (286)
-----------------------------------------------
Net cash provided by financing activities 45 12,155 86,391
-----------------------------------------------
Increase in cash and cash equivalents 6,302 4,421 12,947
Cash and cash equivalents, beginning of period 6,645 6,197 --
-----------------------------------------------
Cash and cash equivalents, end of period $12,947 $ 10,618 $ 12,947
===============================================
The accompanying notes are an integral part of these financial statements.
Page 5
Vion Pharmaceuticals, Inc.
(A Development Stage Company)
Notes to Financial Statements
(Unaudited)
1. The Company
Vion Pharmaceuticals, Inc. (the "Company") is a development stage
biopharmaceutical company engaged in the research, development and
commercialization of cancer treatment technologies. The Company, formerly
OncoRx, Inc., was incorporated in March 1992 as a Delaware corporation and began
operations on May 1, 1994.
2. Basis of Presentation
The accompanying unaudited financial statements have been prepared in
accordance with accounting principles generally accepted in the United States
for interim financial information and with the instructions to Form 10-Q.
Accordingly, they do not include all of the information and footnotes required
by accounting principles generally accepted in the United States for complete
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included. Operating results for interim periods are not necessarily
indicative of the results that may be expected for the year ending December 31,
2002. For further information, refer to the financial statements and footnotes
thereto included in the Company's Annual Report on Form 10-K for the year ended
December 31, 2001 (File No. 000-26534).
3. Per Share Data - Antidilution
The warrants, stock options and preferred stock were antidilutive and
not included in the calculation of the diluted loss applicable to common
shareholders per share.
4. Income Tax Benefit
The Company recognized an income tax benefit of $0.2 million during the
nine-month period ended September 30, 2002 related to the sale of certain
research and development tax credits to the State of Connecticut.
5. Liquidity
The Company is executing the business strategy announced in May 2002
and has implemented cost reduction measures that are expected to extend existing
cash and cash equivalents to fund its planned operations to November 2003, based
on current estimates.
Page 6
We will need to raise substantial additional capital within the next
twelve months to fund our planned operations. We are actively seeking additional
financing as well as investigating other business and strategic alternatives for
the Company. We cannot assure you that the Company will be able to raise
additional capital or otherwise complete another form of transaction to allow
the Company to continue to fund its existing operations after November 2003 nor
can we predict what the terms of any financing or other transaction might be.
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
All statements other than statements of historical fact included in
this Quarterly Report on Form 10-Q, including without limitation statements
under "Management's Discussion and Analysis of Financial Condition and Results
of Operations," regarding our financial position, business strategy, and plans
and objectives of our management for future operations, are forward-looking
statements. When used in this Quarterly Report on Form 10-Q, words such as
"may," "will," "should," "could," "potential," "seek," "project," "predict,"
"anticipate," "believe," "estimate," "expect," "intend" and similar expressions,
as they relate to us or our management, identify forward-looking statements.
Forward-looking statements are based on the beliefs of our management as well as
assumptions made by and information currently available to our management. These
statements are subject to risks and uncertainties that may cause actual results
and events to differ significantly. A detailed discussion of risks attendant to
the forward-looking statements is included under Item 7, "Management's
Discussion and Analysis of Financial Condition and Results of Operations" in our
Annual Report on Form 10-K for the year ended December 31, 2001. The information
contained in this Quarterly Report on Form 10-Q is believed to be current as of
the date of filing with the U.S. Securities and Exchange Commission. We do not
intend to update any of the forward-looking statements after the date of this
filing to conform these statements to actual results or to changes in our
expectations, except as required by law.
Overview
We are a development stage biopharmaceutical company committed to the
discovery, development and commercialization of therapeutics and technologies
for the treatment of cancer. Our activities to date have consisted primarily of
research and product development, obtaining regulatory approval for clinical
trials, conducting clinical trials, negotiating and obtaining collaborative
agreements, and obtaining financing in support of these activities. Our revenues
currently consist of contract research grants and technology license fees. Since
inception, we have generated minimal revenues and have incurred substantial
operating losses from our activities. We expect to incur substantial operating
losses for the next several years due to expenses associated with our
activities.
Our plan of operations for the next 12 months includes the following
elements:
Page 7
o Conduct Phase I clinical studies for safety and dosage of Triapine'r'
in conjunction with standard chemotherapy treatments;
o Conduct Phase II clinical studies of Triapine'r' in conjunction with
standard chemotherapy treatments;
o Conduct Phase II clinical studies of Triapine'r' as a single agent;
o Conduct Phase I clinical studies for safety and dosage of VNP40101M, a
member of the Sulfonyl Hydrazine Prodrug class;
o Conduct Phase II clinical studies of VNP40101M;
o Conduct Phase I clinical studies of TAPET'r' in conjunction with immune
system modulation for further safety and "optimized" selective
accumulation of bacteria in the tumor;
o Develop second generation TAPET'r' vectors;
o Continue to conduct internal research and development with respect to
our core technologies and other product candidates that we may
identify;
o Continue to support research and development being performed at Yale
University and by other collaborators;
o Continue to seek collaborative partnerships, joint ventures,
co-promotional agreements or other arrangements with third parties; and
o Pursue additional financing and evaluate other strategic alternatives.
Results of Operations
Comparison of the Three-Month Periods Ended September 30, 2002 and 2001
Revenues. Revenues were $0.1 million for the three-month period ended
September 30, 2002, as compared to $0.2 million for the same period in 2001. The
decrease was due primarily to lower revenues for the third quarter of 2002 from
Small Business Innovation and Research ("SBIR") research grants and technology
license fees, partially offset by 2002 revenues for laboratory support services.
Research and Development. Total research and development expenses
(which include clinical trials expenses) were $2.1 million for the three-month
period ended September 30, 2002, compared with $3.4 million for the same 2001
period. Clinical trials expenses increased by $0.2 million due primarily to
higher costs associated with clinical trials of VNP40101M and Triapine'r'. Other
research and development costs decreased by
Page 8
$1.5 million due primarily to lower external research support and, to a lesser
extent, lower headcount and no incentive compensation expense recorded in 2002.
General and Administrative. General and administrative expenses
decreased to $0.5 million for the three-month period ended September 30, 2002
from $0.8 million for the comparable 2001 period. The decrease was due primarily
to lower professional fees and, to a lesser extent, no incentive compensation
expense recorded in 2002.
Interest Income. Interest income was $0.1 million for the three-month
period ended September 30, 2002, as compared to $0.3 million for the same period
in 2001. The 2002 decrease was due to lower interest rates and a lower level of
invested funds during the period.
Net Loss. The net loss was $2.5 million, or $0.09 per share, for the
three-month period ended September 30, 2002, compared to a net loss of $3.7
million, or $0.13 per share, for the same period in 2001. Weighted-average
shares outstanding for the three-month periods ended September 30, 2002 and
2001, were 28.9 million and 27.6 million, respectively.
Comparison of the Nine-Month Periods Ended September 30, 2002 and 2001
Revenues. Revenues were $0.2 million for the nine-month period ended
September 30, 2002, as compared to $0.5 million for the same period in 2001. The
decrease was primarily due to lower revenues from SBIR grants and, to a lesser
extent, lower technology license fees for the nine-month period ended September
30, 2002, partially offset by revenues recorded in 2002 for laboratory support
services.
Research and Development. Total research and development expenses
(which include clinical trials expenses) were $8.5 million for the nine-month
period ended September 30, 2002, compared with $9.6 million for the same 2001
period. Clinical trials expenses increased by $1.2 million due to higher costs
associated with clinical trials of Triapine'r' and, to a lesser extent,
VNP40101M and TAPET'r'. Other research and development costs decreased by $2.3
million due primarily to lower external research support and, to a lesser
extent, lower headcount and no incentive compensation expense recorded in 2002.
General and Administrative. General and administrative expenses were
$2.2 million for the nine-month period ended September 30, 2002, as compared to
$2.6 million for the comparable 2001 period. The decrease was due primarily to
lower professional fees and, to a lesser extent, no incentive compensation
expense recorded in 2002.
Interest Income. Interest income was $0.4 million for the nine-month
period ended September 30, 2002, as compared to $1.0 million for the same period
in 2001. The 2002 decrease in interest income was due primarily to lower
interest rates and, to a lesser extent, a lower level of invested funds during
the period.
Page 9
Income Tax Benefit. An income tax benefit of $0.2 million was
recognized during the nine-month period ended September 30, 2002, related to the
sale of certain research and development tax credits to the State of
Connecticut.
Net Loss. The net loss was $9.8 million, or $0.34 per share, for the
nine-month period ended September 30, 2002, compared to a net loss of $10.7
million, or $0.40 per share, for the same period in 2001. Weighted-average
shares outstanding for the nine-month periods ended September 30, 2002 and 2001,
were 28.9 million and 26.7 million, respectively.
Liquidity and Capital Resources
At September 30, 2002, we had cash and cash equivalents of $12.9
million compared to cash, cash equivalents and short-term investments of $22.6
million at December 31, 2001. The decrease was due primarily to cash used to
fund operating activities.
On May 30, 2002, we announced a realignment of priorities and
objectives for the 18 months following May 30, as we focus on advancing our
anti-cancer agents, Triapine'r' and VNP40101M, to Phase II clinical trials. In
accordance with this realignment plan, we reduced our staff by 16 people,
deferred management salaries and decreased other expenses in order to extend our
existing cash resources to November 2003, based on current estimates. The plan
was designed to focus our cash resources on: (i) initiating Phase II trials of
Triapine'r' as a single agent and in combination and obtain data from patients,
(ii) initiating Phase II trials of VNP40101M as a single agent and obtain data
from patients, (iii) initiating an additional Phase I trial of TAPET'r' in
conjunction with modulation of the immune system and obtain data from patients,
and (iv) making progress in developing a second-generation TAPET'r' vector. Our
plan and its focus may vary materially from the foregoing because of the results
of research, development, clinical trials, product testing, relationships with
strategic partners, changes in focus and direction of our research and
development programs, competitive and technological advances, the regulatory
process in the United States and abroad, and other factors.
We will need to raise substantial additional capital within the next
twelve months to fund our planned operations. We are actively seeking additional
financing as well as investigating other business and strategic alternatives for
the Company. We cannot assure you that the Company will be able to raise
additional capital or otherwise complete another form of transaction to allow
the Company to continue to fund its existing operations after November 2003 nor
can we predict what the terms of any financing or other transaction might be.
Subsequent Event
We received notification from The Nasdaq Stock Market ("Nasdaq") on
October 15, 2002, that our common stock will be delisted from The Nasdaq
National Market'r' because
Page 10
we did not comply with Nasdaq's minimum bid price requirements. Specifically, we
did not comply with Marketplace Rule 4450(a)(5) when the bid price of the
Company's common stock closed at less than $1.00 per share for 30 consecutive
trading days. After receiving initial notification from Nasdaq on July 14, 2002,
we were not able to regain compliance in accordance with Marketplace Rule
4450(e)(2) during the 90-day period ending October 14, 2002.
We appealed Nasdaq's determination to delist our common stock from The
Nasdaq National Market by requesting a hearing before a Nasdaq Listing
Qualifications Panel. The delisting proceedings will be stayed and our common
stock will continue to be listed on The Nasdaq National Market pending
resolution of this appeal. There can be no assurance that the Panel will grant
our request for continued listing on The Nasdaq National Market.
If our appeal is unsuccessful, we intend to apply to transfer our
common stock to The Nasdaq SmallCap Market'sm'. Although there can be no
assurances that it will do so, if Nasdaq approves the transfer to The Nasdaq
SmallCap Market, shares of our common stock would continue to be listed under
their existing ticker symbol, VION. As with The Nasdaq National Market, The
Nasdaq SmallCap Market requires listed companies to have a minimum closing bid
price of $1.00 per share. On The Nasdaq SmallCap Market, however, we would be
eligible for an additional grace period ending January 13, 2003, to achieve
compliance with the minimum closing bid requirements.
We may also be eligible for an additional 180-day grace period beyond
that initial Nasdaq SmallCap Market 90-day period, if we comply with the initial
listing requirements of The Nasdaq SmallCap Market. If we are successful in
qualifying for the additional 180-day grace period, we will have until July 10,
2003 to achieve compliance with the minimum closing bid price requirements. If
during these Nasdaq SmallCap grace periods, the closing bid price of our common
stock is $1.00 per share or more for 30 consecutive trading days, we will have
regained compliance with Nasdaq's minimum bid price requirements and may also be
eligible to transfer our common stock back to The Nasdaq National Market,
provided that we have maintained compliance with other continued listing
requirements on that market.
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk
For information regarding our exposure to certain market risks, see
Item 7A, "Quantitative and Qualitative Disclosures About Market Risk", in our
Annual Report on Form 10-K for the year ended December 31, 2001. There have been
no significant changes in our market risk exposure since the year-end.
ITEM 4. Controls and Procedures
Within 90 days prior to the date of this report, we carried out an
evaluation, under the supervision and with the participation of our chief
executive officer and chief financial officer, of the effectiveness of the
design and operation of our disclosure controls and
Page 11
procedures. Based on this evaluation, our chief executive officer and chief
financial officer concluded that our disclosure controls and procedures are
effective in timely alerting them to material information required to be
included in our periodic filings with the Securities and Exchange Commission. It
should be noted that the design of any system of controls is based in part upon
certain assumptions about the likelihood of future events, and there can be no
assurance that any design will succeed in achieving its stated goals under all
potential future conditions, regardless of how remote.
In addition, we reviewed our internal controls, and there have been no
significant changes in our internal controls or in other factors that could
significantly affect those controls subsequent to the date of their last
evaluation.
PART II
OTHER INFORMATION
ITEM 4. Submission of Matters to a Vote of Security Holders
None.
ITEM 5. Other Information
None.
ITEM 6. Exhibits and Reports on Form 8-K
(a) Exhibits.
Exhibit 99.1 CEO Certification Pursuant to 18 U.S.C. Section
1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002
Exhibit 99.2 CFO Certification Pursuant to 18 U.S.C. Section
1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002
(b) Reports on Form 8-K.
The Registrant filed the following reports on Form 8-K during the
quarter ended September 30, 2002:
1. On July 18, 2002 under Item 5 and Item 7 to announce the
Company received notification from The Nasdaq Stock Market
("Nasdaq") on July 14, 2002 that the Company did not comply
with Nasdaq's minimum bid price requirements.
Page 12
2. On August 6, 2002 under Item 5 and Item 7 to announce the
Company's 2002 second quarter financial results.
3. On August 9, 2002 under Item 5 and Item 7 to announce the
Company initiated a Phase I trial of VNP40101M in leukemia.
4. On September 19, 2002 under Item 5 and Item 7 to announce
the Company initiated a Phase I trial of TAPET'r' with
immune system modulation.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Dated: November 6, 2002 Vion Pharmaceuticals, Inc.
By: /s/ Howard B. Johnson
-----------------------------------
Howard B. Johnson
Vice President, Finance and
Chief Financial Officer
Page 13
CERTIFICATE OF CHIEF EXECUTIVE OFFICER
I, Alan Kessman, President and Chief Executive Officer, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Vion Pharmaceuticals,
Inc.;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the effectiveness of
the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):
a) all significant deficiencies in the design or operation of internal controls
which could adversely affect the registrant's ability to record, process,
summarize and report financial data and have identified for the registrant's
auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls; and
Page 14
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Date: November 6, 2002
/s/ Alan Kessman
- -------------------
Alan Kessman
President and Chief Executive Officer
CERTIFICATE OF CHIEF FINANCIAL OFFICER
I, Howard B. Johnson, Vice President, Finance and Chief Financial Officer,
certify that:
1. I have reviewed this quarterly report on Form 10-Q of Vion Pharmaceuticals,
Inc.;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the effectiveness of
the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):
Page 15
a) all significant deficiencies in the design or operation of internal controls
which could adversely affect the registrant's ability to record, process,
summarize and report financial data and have identified for the registrant's
auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Date: November 6, 2002
/s/ Howard B. Johnson
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Howard B. Johnson
Vice President, Finance and Chief Financial Officer
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STATEMENT OF DIFFERENCES
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The registered trademark symbol shall be expressed as...................'r'
The service mark symbol shall be expressed as...........................'sm'