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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark one)
[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 PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
From the transition period from to
Commission File Number: 0-27854
BONE CARE INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
Wisconsin 39-1527471
(State of (IRS Employer
Incorporation) Identification No.)
1600 Aspen Commons, Suite 300
Middleton, Wisconsin 53562
(Address, including zip code of
Registrant's principal executive offices)
608-662-7800
(Registrant's telephone number, including area code)
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 [ ]
As of November 1, 2002, 14,156,772 shares of the registrant's common stock, no
par value, were outstanding.
BONE CARE INTERNATIONAL, INC.
FORM 10-Q
For the quarterly period ended September 30, 2002
TABLE OF CONTENTS
Page
PART I - FINANCIAL INFORMATION
Item 1 Financial Statements
Condensed Balance Sheets
September 30, 2002 and June 30, 2002 3
Condensed Statements of Operations
Quarters Ended September 30, 2002
and 2001 5
Condensed Statements of Cash Flows
Quarters Ended September 30, 2002
and 2001 6
Notes to Condensed Financial Statements 7
Item 2 Management's Discussion and Analysis of Financial 8
Condition and Results of Operations
Item 3 Quantitative and Qualitative Disclosures About Market Risk 11
Item 4 Controls and Procedures 11
PART II - OTHER INFORMATION
Item 1 Legal Proceedings 12
Item 2 Changes in Securities and Use of Proceeds 12
Item 3 Defaults Upon Senior Securities 12
Item 4 Submission of Matters to a Vote of Security Holders 12
Item 5 Other Information 12
Item 6 Exhibits and Reports on Form 8-K 13
SIGNATURES 14
SARBANES-OXLEY Certifications 15
EXHIBIT INDEX 17
PART 1. FINANCIAL INFORMATION
Item 1. Financial Statements
BONE CARE INTERNATIONAL, INC.
Condensed Balance Sheets
September 30, June 30,
2002 2002
ASSETS (Unaudited)
----------- -----------
Current Assets:
Cash and cash equivalents $ 5,193,890 $ 2,023,969
Marketable securities 14,947,767 18,436,896
Accounts receivable, net of allowance for
doubtful accounts of $156,100 and $152,960
at September 30, 2002 and June 30, 2002,
respectively 3,912,190 4,285,569
Inventories 1,324,386 2,099,469
Other current assets 1,376,664 775,596
----------- -----------
Total current assets 26,754,897 27,621,499
----------- -----------
Long-term securities 2,986,808 3,719,796
Other long-term assets 110,300 --
Property, plant and equipment-at cost:
Leasehold improvements 588,632 588,632
Furniture and fixtures 458,412 452,345
Machinery and other equipment 2,594,160 2,317,405
----------- -----------
3,641,204 3,358,382
Less accumulated depreciation and amortization 1,730,101 1,573,497
----------- -----------
1,911,103 1,784,885
Patent fees net of accumulated amortization
of $1,045,070 at September 30, 2002 and 1,245,623 1,198,249
$998,027 at June 30, 2002
Goodwill 359,165 359,165
----------- -----------
$33,367,896 $34,683,594
=========== ===========
See the accompanying notes to condensed financial statements.
-3-
BONE CARE INTERNATIONAL, INC.
Condensed Balance Sheets
September 30, June 30,
2002 2002
Liabilities and Shareholders' Equity (Unaudited)
------------ ------------
Current liabilities:
Accounts payable $ 1,705,506 $ 1,769,665
Accrued liabilities:
Accrued clinical study and research costs 203,352 152,352
Compensation payable 658,186 509,677
Other current liabilities -- 1,924
Allowance for sales returns 426,100 226,100
------------ ------------
Total current liabilities 2,993,144 2,659,718
Shareholders' equity:
Preferred stock-authorized 2,000,000 -- --
shares of $.001 par value; none issued
Common stock-authorized 28,000,000 shares of no par value; issued and
outstanding 14,156,772 shares at September 30, 2002
and at June 30, 2002 11,393,883 11,393,883
Additional paid-in capital 62,096,272 62,096,272
Accumulated deficit (43,151,374) (41,520,236)
Accumulated other comprehensive income 35,971 53,957
------------ ------------
Total shareholders' equity 30,374,752 32,023,876
------------ ------------
$ 33,367,896 $ 34,683,594
============ ============
See the accompanying notes to condensed financial statements.
-4-
BONE CARE INTERNATIONAL, INC.
Condensed Statements of Operations
(Unaudited)
Three Months Ended
------------------
September 30, September 30,
2002 2001
------------ ------------
Revenues $ 5,417,400 $ 2,652,140
------------ ------------
Operating expenses
Cost of sales 1,509,606 592,906
Research and development 1,448,436 1,391,717
Sales and marketing 3,024,950 2,249,835
General and administrative 1,280,326 914,934
------------ ------------
7,263,318 5,149,392
------------ ------------
Loss from operations (1,845,918) (2,497,252)
Interest income 214,780 361,053
------------ ------------
Net loss $ (1,631,138) $ (2,136,199)
============ ============
Net loss per common share - basic and diluted $ (0.12) $ (0.15)
============ ============
Weighted average number of common shares 14,156,772 13,987,575
============ ============
See the accompanying notes to condensed financial statements.
-5-
BONE CARE INTERNATIONAL, INC.
Condensed Statements of Cash Flows
(Unaudited)
Three Months Ended
------------------
September 30, September 30,
2002 2001
----------- -----------
Cash flows from operating activities
Net loss $(1,631,138) $(2,136,199)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation of fixed assets 156,604 138,278
Amortization of patents 47,043 57,000
Loss on disposal of fixed assets -- 1,018
Loss on disposal of patents -- 6,144
Changes in assets and liabilities:
Accounts receivable 373,379 (363,919)
Inventories 775,083 (1,112,020)
Other current assets (601,068) 68,195
Other long-term assets (110,300) --
Accounts payable (64,159) 249,080
Accrued liabilities 197,585 (79,491)
Allowance for sales returns 200,000 --
----------- -----------
Net cash used in operating activities (656,971) (3,171,914)
----------- -----------
Cash flows from investing activities:
Sale and maturities of marketable securities 4,204,131 2,753,724
Additions to property, plant and equipment (282,822) (193,224)
Patent fees (94,417) (55,606)
----------- -----------
Net cash provided by investing activities 3,826,892 2,504,894
----------- -----------
Cash flow from financing activities:
Proceeds from stock option exercises -- 197,400
----------- -----------
Net cash provided by financing activities -- 197,400
----------- -----------
Net decrease in cash and cash equivalents 3,169,921 (469,620)
Cash and cash equivalents at beginning of period 2,023,969 1,842,838
----------- -----------
Cash and cash equivalents at end of period $ 5,193,890 $ 1,373,218
=========== ===========
See the accompanying notes to condensed financial statements.
-6-
BONE CARE INTERNATIONAL, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
(1) BASIS OF PRESENTATION
The financial statements in this report have been prepared by Bone Care
International, Inc. without audit, pursuant to the rules of the Securities and
Exchange Commission for quarterly reports on Form 10-Q and do not include all of
the information and note disclosures required by accounting principles generally
accepted in the United States of America for annual financial statements. These
financial statements should be read in conjunction with the financial statements
and notes thereto for the year ended June 30, 2002, included in the Company's
Form 10-K as filed with the Securities and Exchange Commission on September 30,
2002.
In the opinion of management, information included in this report reflects
all adjustments, consisting of normal, recurring adjustments, necessary for a
fair presentation of results for these interim periods.
The results of operations for the interim period ended September 30, 2002,
are not necessarily indicative of the results to be expected for the entire
fiscal year ending June 30, 2003.
(2) REVENUE RECOGNITION POLICY
Bone Care records sales and the related costs of Hectorol Capsules and
Hectorol Injection based on shipments to its customers reduced by the estimated
future returns. The terms of sale for all product sales are F.O.B. shipping
point. Revenue is recognized at the time of shipment as risk of loss has
transferred to the customer, delivery has occurred, and collectibility is
reasonably certain. Customers have a right to return product if they are unable
to sell it prior to the expiration date. In accordance to Statement of Financial
Accounting Standard (SFAS) No. 48, "Revenue Recognition When Right of Return
Exists", Bone Care's September 30, 2002 balance sheet includes a $426,100
accrual for the estimated amount of future returns related to Hectorol Capsules
and Hectorol Injection.
License fees received by Bone Care are recognized as income when the
associated licensing obligations are satisfied. For the quarter ended September
30, 2002, no license fees were recognized.
(3) INVENTORIES
Inventories are stated at the lower of cost or market; cost is determined
principally by the first-in, first-out method. Inventories are comprised of:
September 30, June 30,
2002 2002
---------- ----------
Raw materials $ 456,567 $ 456,548
Work in process 68,807 610,171
Finished goods 799,012 1,032,750
---------- ----------
$1,324,386 $2,099,469
========== ==========
(4) NET LOSS PER SHARE
Net loss per share is computed by dividing net loss by the weighted average
number of shares of common stock outstanding during the period. Options to
purchase common stock have been excluded from the calculations of diluted
earnings per share as the impact of these options on diluted earnings per share
would be anti-dilutive.
-7-
(5) COMPREHENSIVE INCOME
Total comprehensive loss was $1,649,124 and $2,103,909 for the three
months ended September 30, 2002 and 2001, respectively. Our comprehensive income
includes unrealized gains and losses on available-for-sale securities.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Results of Operations
Total revenues for the first quarter ended September 30, 2002 increased to
$5,417,400 from $2,652,140 in the quarter ended September 30, 2001. The increase
was the result of increased sales of Hectorol(R) IV, offset by a decline in
sales of Hectorol Capsules. Hectorol IV, launched in August 2000, generated
revenues of $4,185,859 during the quarter ended September 30, 2002 compared to
$1,023,055 in the quarter ended September 30, 2001. Hectorol Capsule revenues
were $1,231,541 for the quarter ended September 30, 2002, compared to $1,629,085
in the quarter ended September 30, 2001.
Gross margins for the quarter ended September 30, 2002, were $3,907,794,
or 72% of revenues compared to $2,059,234, or 78% of revenues in the quarter
ended September 30, 2001. Current quarter margins were lower as a percentage of
sales due to increased spending for quality assurance overhead.
Research and development expenses were relatively unchanged at $1,448,436
in the quarter ended September 30, 2002, and $1,391,717 in the quarter ended
September 30, 2001.
Sales and marketing expenses increased $775,115 to $3,024,950 in the
quarter ended September 30, 2002, from $2,249,835 in the quarter ended September
30, 2001. These increases are attributable to an increase in the sales force
from 31 at September 30, 2001 to 40 at September 30, 2002 and an increase in the
marketing staff from 4 at September 30, 2001 to 8 at September 30, 2002. We
implemented these headcount increases in anticipation of a national J-code that
became effective January 1, 2002. This code was issued by the Centers for
Medicare and Medicaid Services (CMS) for reimbursement of Hectorol Injection
during hemodialysis.
General and administrative expenses increased $365,392 to $1,280,326 in
the quarter ended September 30, 2002 from $914,934 in the quarter ended
September 30, 2001. The increase was attributable to costs associated with
hiring the President and CEO.
Interest income decreased $146,273 to $214,780 in the quarter ended
September 30, 2002, from $361,053 in the quarter ended September 30, 2001. The
decrease was due to lower average cash and marketable security balances for the
quarter ended September 30, 2002, as well as a decline in yield on our
investments.
-8-
Manufacturing
Akorn, Inc., currently the sole manufacturer of Hectorol Injection,
received a warning letter from the FDA in September 2000 identifying general
deviations from the FDA's current Good Manufacturing Practices (c-GMP) regarding
manufacturing procedures, records and training. They received another letter
from the FDA in December 2001 identifying additional deviations from c-GMP
pursuant to a follow-up inspection of their facility. In response to this second
FDA letter, Akorn agreed to halt production of Hectorol Injection until such
time as these deviations could be remediated. Akorn is scheduled to produce
validation lots during November and December that could ultimately be used as
commercial product. If they successfully complete the validation lots and pass
the FDA site re-inspection and the FDA accepts our submission under an
accelerated review process, we anticipate product from Akorn will be
commercially available by the end of calendar 2002 or the beginning of the first
quarter, calendar 2003. We are managing the inventory levels of the supplier
channels in an attempt to ensure that clinics and patients do not experience any
shortage of product. In addition, we have entered into a manufacturing agreement
with Draxis Pharma Inc., a subsidiary of Draxis Health Inc., to serve as an
additional manufacturer of Hectorol(R) Injection. Draxis anticipates completing
manufacturing process validation runs, which could ultimately be used as
commercial product, by the end of November 2002. If they successfully complete
these validation lots and the FDA accepts our submission for Draxis under an
accelerated review process, we anticipate this product supply would be
commercially available in the first quarter of calendar 2003. Although we cannot
at this point give assurance that we will meet these goals, we believe that we
will have commercial supply of Hectorol Injection from one or both of our
contract manufacturers no later than the first quarter of calendar 2003.
Liquidity and Capital Resources
Net cash used in operating activities was $656,971 for the quarter ended
September 30, 2002 and $3,171,914 for the quarter ended September 30, 2001. The
cash used by operating activities was used primarily to fund research and
development as well as marketing and commercialization efforts for Hectorol
Capsules and Hectorol Injection.
We have experienced negative cash flows from operations since our
inception and do not anticipate generating sufficient positive cash flows to
fund our operations until we achieve, if ever, significant revenues from the
sale of Hectorol Capsules and Hectorol Injection. We have expended, and expect
to continue to expend in the future, substantial funds for our:
- research and development programs;
- pre-clinical and clinical testing;
- regulatory processes, including completion of FDA post-approval
Phase IV commitments for Hectorol Capsules and Hectorol Injection;
- manufacturing expenses;
- sales and marketing programs; and
- other operating expenses.
Cash, cash equivalents and short- and long-term marketable securities were
$23,128,465 at September 30, 2002 and $24,180,661 at June 30, 2002. Cash and
cash equivalents are currently invested primarily in short-term investment grade
United States government, municipal and corporate debt securities.
-9-
Bone Care's capital requirements will depend on numerous factors,
including the progress of commercialization and marketing activities; the
progress of its research and development programs; the progress of preclinical
and clinical testing; the time and cost involved in obtaining regulatory
approvals; the cost of filing, prosecuting, defending and enforcing any patent
claims and other intellectual property rights; competing technological and
market developments; changes and developments in Bone Care's existing licensing
relationships and the terms of any new collaborative, licensing, co-promotion or
distribution arrangements that Bone Care may establish; the cost of
manufacturing preclinical and clinical products; and other factors not within
our control.
Based upon our current plans, we believe that we will have sufficient
funds to meet our operating expenses and capital requirements for at least the
next two years. Thereafter, we may need to raise additional capital to fund our
operations; however, we do not have any specific plans to raise additional
capital. If we seek additional funds, equity offerings or other sources would be
considered. There is no assurance that such additional funds will be available
on acceptable terms, if at all. Should our plans not be consummated, we may have
to seek alternative sources of capital.
At June 30, 2002, we had state tax net operating loss carryforwards of
approximately $38,010,000 and state research and development tax credit
carryforwards of approximately $449,000, which will begin expiring in 2006. We
also had federal net operating loss carryforwards of approximately $39,352,000
and research and development tax credit carryforwards of approximately
$1,741,000, which will begin expiring in 2011.
Critical Accounting Policies and Estimates
Our significant accounting policies are described in Note 1 to the Notes
to the Financial Statements for the year ended June 30, 2002 included in the
Company's Form 10-K as filed with the Securities and Exchange Commission on
September 30, 2002. Those financial statements have been prepared in accordance
with accounting principles generally accepted in the United States of America.
The preparation of these financial statements requires us to make estimates and
judgments that affect the reported amounts of assets, liabilities, revenues and
expenses, and related disclosure of contingent liabilities. On an on-going
basis, we evaluate our estimates, including those related to our provision for
sales returns and allowances, allowance for doubtful accounts, and our estimate
of excess and obsolete inventory. We base our estimates on historical experience
and on various other assumptions that we believe to be reasonable under the
circumstances, the results of which form the basis of judgments regarding the
carrying values of assets and liabilities that are not readily apparent from
other sources. Actual results may differ from these estimates under different
assumptions or conditions.
Sales Returns and Allowances
When revenue is recognized, Bone Care simultaneously records an estimate
of various costs, which reduce product sales. These costs include estimates for
product returns, chargebacks, rebates, and discounts. Estimates are based on a
variety of factors including actual return experience, rebate and chargeback
agreements, inventory levels at our wholesale customers, and estimated sales by
our wholesale customers to other third parties who have contracts with us,
respectively. Actual experience associated with any of these items may differ
materially from our estimates. Factors are reviewed that influence our estimates
and, if necessary, adjustments are made when we believe that actual product
returns, chargebacks, rebates, and discounts may differ from established
reserves.
-10-
Allowance for Doubtful Accounts
An allowance is maintained for estimated losses resulting from the
inability of customers to make required payments. Credit terms are extended on
an uncollateralized basis primarily to wholesale drug distributors and
independent clinics throughout the United States. Management specifically
analyzes accounts receivable, historical bad debts, customer credit-worthiness,
percentage of accounts receivable by aging category, and changes in customer
payment terms when evaluating the adequacy of the allowance for doubtful
accounts. If the financial condition of our customers were to deteriorate,
resulting in an impairment of their ability to make payments, additional
allowances may be required. Historically, our actual losses from uncollectible
accounts have been insignificant.
Excess and Obsolete Inventory
Inventories are stated at the lower of cost or market, with cost
determined at a standard cost rate. In evaluating whether inventory is stated at
the lower of cost or market, management considers such factors as the amount of
inventory on hand, expiration dates, and the estimated time to sell such
inventory. As appropriate, provisions are made to reduce inventories to their
net realizable value. Historically, cost of inventories that potentially may not
sell prior to expiration or are deemed of no commercial value have been
written-off when identified.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Our sales from inception to date have been made to U.S. customers and, as
a result, we have not had any exposure to factors such as changes in foreign
currency exchange rates or weak economic conditions in foreign markets. However,
in future periods, we expect to sell in foreign markets, including Europe and
Asia. Because our sales are made in U.S. dollars, a strengthening of the U.S.
dollar could make our products less competitive in foreign markets. At September
30, 2002, we did not hold any short- or long-term investments other than
high-grade investment securities planned to be held to maturity and, therefore,
we do not believe that short-term fluctuations of interest rates would
materially affect the value of our investments.
Item 4. Controls and Procedures
The Company's management, including its chief executive officer and
chief financial officer, have conducted an evaluation of effectiveness of
disclosure controls and procedures pursuant to Rule 13a-14 of the Securities
Exchange Act of 1934. Based on that evaluation, the chief executive officer and
chief financial officer concluded that the disclosure controls and procedures
are effective in ensuring that all material information required to be filed in
this quarterly report has been made known to them in a timely fashion. There
have been no significant changes in internal controls, or in factors that could
significantly affect internal controls, subsequent to the date the chief
executive officer and chief financial officer completed their evaluation.
-11-
PART II - OTHER INFORMATION
BONE CARE INTERNATIONAL, INC.
Item 1. Legal Proceedings
Bone Care may be a defendant from time to time in actions
arising out of our ordinary course of business operations. In the
opinion of management, the outcome of pending claims is not likely
to have a material adverse effect on our financial statements.
Item 2. Changes in Securities and Use of Proceeds
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information - Recent Developments
This Quarterly Report on Form 10-Q includes forward-looking
statements within the meaning of Section 27A of the Securities Act
and Section 21E of the Exchange Act. We have based these
forward-looking statements largely on our current expectations and
projections about future events and financial trends affecting the
financial condition of our business. These forward-looking
statements are subject to a number of risks, uncertainties and
assumptions about us, including, among other things:
- general economic and business conditions, both
nationally and in our markets;
- our expectations and estimates concerning future
financial performance, financing plans and the impact of
competition;
- anticipated trends in our business;
- existing and future regulations affecting our business;
- our early stage of development;
- the uncertainty of our future profitability;
- our ability to satisfy the FDA's conditions for
marketing approval for Hectorol;
- other risk factors
-12-
In addition, in this Quarterly Report, the words "believe,"
"may," "will," "estimate," "continue," "anticipate," "intend,"
"expect" and similar expressions, as they relate to us, our business
or our management, are intended to identify forward-looking
statements.
Unless otherwise required by law, we undertake no obligation
to publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise after the
date of this Quarterly Report. However, we acknowledge our
obligation to disclose material developments related to previously
disclosed information. In light of these risks and uncertainties,
the forward-looking events and circumstances discussed in the
Quarterly Report may not occur and actual results could differ
materially from those anticipated or implied in the forward-looking
statements.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits furnished:
(11) Statement Regarding Computation of Loss Per Share
(99.1) Certification Pursuant to Section 1350 of Chapter 63 of
Title 18 of the United States Code
(99.2) Certification Pursuant to Section 1350 of Chapter 63 of
Title 18 of the United States Code
(b) Reports on Form 8-K
The Company filed a Form 8-K dated July 8, 2002 reporting under
Item 4 a change in the Company's certifying accountant.
-13-
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.
BONE CARE INTERNATIONAL, INC.
(Registrant)
Date: November 13, 2002 /s/ Paul L. Berns
-------------------------------------
Paul L. Berns
President and Chief Executive Officer
(Principal Executive Officer)
Date: November 13, 2002 /s/ Robert A. Beckman
-------------------------------------
Robert A. Beckman
Vice President - Finance
(Principal Financial and Accounting
Officer)
-14-
CERTIFICATIONS
I, Paul L. Berns, the President and Chief executive Officer of Bone
Care International, Inc. (the "registrant"), certify that:
1. I have reviewed this quarterly report or Form 10-Q of the registrant;
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 in
order 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; and
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; and
4. the registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
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; and
5. the registrant's other certifying officer 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 functions):
(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 officer and I have indicated in this
quarterly report whether 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 13, 2002
/S/ PAUL L. BERNS
-------------------------------------
Paul L. Berns
President and Chief Executive Officer
-15-
CERTIFICATIONS
I, Robert A. Beckman, the Vice President-Finance of Bone Care
International, Inc. (the "registrant"), certify that:
1. I have reviewed this quarterly report or Form 10-Q of the registrant;
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 in
order 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; and
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; and
4. the registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
have:
d) 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;
e) 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
f) 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; and
5. the registrant's other certifying officer 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 functions):
(c) 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
(d) 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 officer and I have indicated in this
quarterly report whether 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 13, 2002
/S/ ROBERT A. BECKMAN
------------------------
Robert A. Beckman
Vice President - Finance
-16-
BONE CARE INTERNATIONAL, INC.
Exhibit Index
For the Quarterly Period Ended September 30, 2002
No. Description Page
11 Statement Regarding Computation of Loss Per Share........................ 18
99.1 Certification Pursuant to 18 U.S.C. Section 1350, as enacted by section
906 of the Sarbanes - Oxley Act of 2002.................................. 19
99.2 Certification Pursuant to 18 U.S.C. Section 1350, as enacted by section
906 of the Sarbanes - Oxley Act of 2002.................................. 20
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