8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): December 19, 2006

Tapestry Pharmaceuticals, Inc.
(Exact name of registrant as specified in its charter)

Delaware	0-24320	84-1187753
(State of incorporation)	(Commission File Number)	IRS Employer Identification No.)

4840 Pearl East Circle, Suite 300W
Boulder, Colorado 80301
(Address of principal executive offices and zip code)

(303) 516-8500
(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o            Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o            Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o            Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o            Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 5.02.  Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(c)

On December 27, 2006, Tapestry Pharmaceuticals, Inc. (the “Company”) announced the appointment of Donald H. Picker, Ph.D., age 60, to the position of President.  A copy of the press release is attached as Exhibit 99.1.

Prior to joining the Company, Dr. Picker had served as the Executive Vice President, R&D of Callisto Pharmaceuticals, Inc. since April 2004.  From May 2003 until March 2004, Dr. Picker served as Senior Vice President, Drug Development of Callisto Pharmaceuticals, Inc.  Dr. Picker was Chief Executive Officer and President of Synergy Pharmaceuticals Inc. and a member of its board of directors from September 1999 to April 2003.  From February 1997 to September 1999, Dr. Picker was President and Chief Operating Officer of LXR Biotechnology Inc., an apoptosis drug development company.  From 1991 to 1997, he was Senior Vice President of Research and Development at Genta Inc., an antisense drug development company. Dr. Picker is also a director of Xenomics, Inc., a molecular diagnostics company.

On December 19, 2006, the Company entered into an Employment Agreement with Dr. Picker (the “Employment Agreement”), relating to Dr. Picker’s service as President of the Company, to be effective as of January 2, 2007.  Pursuant to the Employment Agreement, Dr. Picker will be an at-will employee of the Company, and his employment may be terminated at any time with or without cause.  As compensation for his services as President, Dr. Picker will (1) receive a base salary of $300,000 per year, subject to any increase by the Compensation Committee of the Company’s Board of Directors in its discretion, and (2) be entitled to receive an initial grant of options to purchase 444,089 shares of the Company’s common stock under the Company’s 2006 Equity Incentive Plan, such grant to be effective if and when Dr. Picker commences employment with the Company on or about January 2, 2007.  The initial stock options will have an exercise price equal to the greater of $2.10 per share or the closing price of the Company’s common stock on NASDAQ on the date the grant is effective.  Under the Employment Agreement, Dr. Picker would be granted an additional option to purchase 444,089 shares of the Company’s common stock under the Company’s 2006 Equity Incentive Plan, contingent upon the approval of the Company’s stockholders of modifications to the 2006 Equity Incentive Plan increasing the total authorized shares available for issuance under such plan.  The additional stock options will have an exercise price equal to the greater of $2.10 per share or the closing price of the Company’s common stock on NASDAQ on the date stockholder approval is received.  All stock options granted in accordance with the Employment Agreement shall vest as follows:  1/6 when the 20 trading day average of the closing sale prices of the Company’s common stock equals or exceeds 130% of the exercise price of the option; 1/6 when such average equals or exceeds 160% of the exercise price; 1/6 when such average equals or exceeds 190% of the exercise price;  1/6 when such average equals or exceeds 220% of the exercise price; 1/6 when such average equals or exceeds 250% of the exercise price; and  1/6 when such average equals or exceeds 300% of the exercise price.  Any unvested shares subject to the options will vest on the 5th anniversary of the grant date.  If the Company terminates Dr. Picker’s employment without Cause or Dr. Picker resigns for Good Reason (each as defined in the Employment Agreement), Dr. Picker will be entitled to a severance payment in the amount of $300,000.  Dr. Picker is also entitled to receive other fringe benefits in accordance with the Company’s standard employee benefit programs in effect from time to time and will be reimbursed by the Company for all reasonable business expenses incurred in connection with the performance of his duties under the Employment Agreement.

There are no arrangements or understandings between Dr. Picker and any other person pursuant to which he was selected as President of the Company.  There are no family relationships between Dr. Picker and the Company’s directors, executive officers or nominees therefor.  The Company is not a participant in any transaction or proposed transaction with Dr. Picker or any of his immediate family members or in which Dr. Picker or any of his immediate family members has or will have a direct or indirect material interest required to be reported under Item 404(a) of Regulation S-K.

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Item 8.01.  Other Events.

On December 21, 2006, Callisto Pharmaceuticals, Inc. (“Callisto”) filed a complaint in the Supreme Court of New York, County of New York, relating to the employment of Dr. Picker.  The suit names the Company and two of its officers, Leonard Shaykin, and Kai Larson as defendants.  In its complaint, Callisto alleges breaches of a confidentiality agreement between Callisto and Tapestry, and also interference with Dr. Picker’s contractual relationship with Callisto.  Callisto seeks unspecified actual and punitive damages.

Item 9.01.  Financial Statements and Exhibits

(d)

Exhibit No.	Description
Exhibit 99.1	Press Release announcing appointment of Donald H. Picker, Ph.D., as President of Tapestry Pharmaceuticals, Inc.

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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 hereunto duly authorized.

Date: December 27, 2006	TAPESTRY PHARMACEUTICALS, INC.
	By:	/s/ Kai Larson
	Name:	Kai Larson
	Title:	Vice President, General Counsel

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EXHIBIT INDEX

Exhibit No.	Description
Exhibit 99.1	Press Release announcing appointment of Donald H. Picker, Ph.D., as President of Tapestry Pharmaceuticals, Inc.

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EX-99.1

Exhibit 99.1

Press Release

630 Fifth Avenue, Suite 3110
New York, NY 10111 Tel 212 218 8720
Fax 212 218 8721 4840 Pearl East Circle, Suite 300W
Boulder, CO 80301 Tel 303 516 8500
Fax 303 530 1296 www.tapestrypharma.com

Contact:	Tapestry Pharmaceuticals, Inc. Gordon Link Senior Vice President, Chief Financial Officer 303-516-8500 glink@tapestrypharma.com	Investor:	Lilian Stern Stern Investor Relations, Inc. 212-362-1200 lilian@sternir.com
	Elma Hawkins, PhD Communications and Corporate Development 212-400-3019 ehawkins@tapestrypharma.com	Media:	Lloyd Benson/Dana Conti Schwartz Communications 781-684-0770 tapestry@schwartz-pr.com

For Immediate Release

TAPESTRY PHARMACEUTICALS APPOINTS
DONALD H. PICKER, PH.D. AS PRESIDENT

Seasoned Executive To Head Company’s Drug Development Program

Boulder, Colo., December 27, 2006 — Tapestry Pharmaceuticals, Inc. (Nasdaq: TPPH) today announced the appointment of Donald H. Picker, Ph.D. to the position of President, effective January 2, 2007.  Dr. Picker joins Tapestry with more than 25 years of experience in all phases of oncology drug development.   At Tapestry, Dr. Picker will be responsible for leading Tapestry’s internal research efforts in addition to the preclinical and clinical development of the product pipeline, including the Company’s lead product, TPI 287.  Dr. Picker will also establish a New Jersey-based office where clinical development will be headquartered.  All other research, development and operational functions will remain in Boulder, Colo.

“Tapestry’s preclinical data on TPI 287 shows significant promise in treating multi-drug resistant tumors, a growing issue for oncologists and patients today,” commented Dr. Picker. “This is an exciting time for Tapestry, and I look forward to working with the Tapestry team to move TPI 287 into Phase II trials in 2007.”

“As we look forward to advancing TPI 287 in the clinic, it became appropriate to bring someone with Don’s development and clinical experience to Tapestry. His knowledge in the area of oncology drug development and experience with in-licensing will make him a valuable addition to the Tapestry team,” said Leonard P. Shaykin, Chairman and Chief Executive Officer of Tapestry Pharmaceuticals.

Dr. Picker began his career at SmithKline Beecham (GlaxoSmithKline) in research and later served as Worldwide Vice President of Biomedical R&D for Johnson Matthey where he oversaw the discovery and development of the anticancer drug candidates Carboplatin, Satraplatin and Picoplatin.  Dr. Picker joined Genta Incorporated early in its inception as Senior Vice President of Research & Development where he led the team that discovered and brought into the clinic the oncology drug Genasense®.  Since Genta, Dr. Picker has been involved in a number of start-up biotech companies in the area of oncology, most recently at Callisto Pharmaceuticals as Executive Vice President of Research and Development.  Dr. Picker is a medicinal organic chemist by training and has co-authored some 35 publications and is named on ten issued patents in the area of oncology.

About TPI 287

TPI 287, a proprietary third generation taxane, is Tapestry’s lead clinical compound. This compound was designed to overcome multi-drug resistance in solid tumors that have become resistant to taxane therapy. In preclinical testing, TPI 287 demonstrated the ability to inhibit tumor cell growth in a number of in vitro cell lines and has shown inhibition of human tumors in certain animal xenograft models when tested against standard comparative agents. The in vitro activity was seen across multiple cell lines including cell lines known to be sensitive to taxanes and cell lines known to be resistant to taxanes. In in vivo testing TPI 287 demonstrated reduction in the rate of tumor growth in both taxane resistant and taxane sensitive breast cancer xenografts. Taxane sensitive cell lines in which TPI 287 has shown activity include cell lines derived from breast cancer, uterine cancer and non-small cell lung cancer. Taxane resistant cell lines in which TPI 287 has shown activity include lines derived from breast cancer, colon cancer, prostate cancer and pancreatic cancer.

TPI 287 is currently in two Phase I studies in the United States and overseas to determine the safety and pharmacokinetic profile of the compound. Tapestry plans to initiate Phase II trials in the first quarter of 2007.

About Tapestry Pharmaceuticals, Inc.

Tapestry Pharmaceuticals, Inc. is a company focused on the development of proprietary therapies for the treatment of cancer.

For more information about Tapestry and its technologies, visit Tapestry’s web site at www.tapestrypharma.com.

Forward Looking Statements

Statements in this press release that are not historical facts are “forward-looking statements” that involve risks and uncertainties. Forward-looking statements can be identified by the use of words such as “opportunities,” “trends,” “potential,” “estimates,” “may,” “will,”

“should,” “anticipates,” “expects,” “hopes” or comparable terminology or by discussions of strategy. Such forward looking statements include statements relating to the initiation of Phase II trials of TPI 287 in 2007. Such statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from the results, performance or achievements expressed or implied by such forward-looking statements. Such risks, uncertainties and other factors include risks that clinical trials for TPI 287 will be delayed due to institutional approvals, patient recruitment, formulation and manufacturing difficulties, delays in finalizing and receiving appro val of Phase II protocols, negotiations with regulatory agencies, or other factors; that human clinical trials may show that TPI 287 is unsafe and/or ineffective in treating cancer in humans. General implementation risks associated with development of TPI 287 include those that we are blocked or limited in the development of TPI 287 because of the intellectual property rights of third parties; that we are limited in our ability to obtain, maintain and enforce our own intellectual property; that development of TPI 287 is delayed or terminated because the costs of further development exceed its value; and that the Company’s resources will be insufficient to continue development. Additional risks, uncertainties and other factors are identified under the captions “Risk Factors” and “Special Note Regarding Forward-Looking Statements” in the Company’s reports filed from time to time with the Securities and Exchange Commission, including its Quarter Reports on Form 10-Q for the Quarter ended September 27, 2006. The Company disclaims any intention or obligation to update publicly or revise any forward-looking statements, whether as a result of new or additional information, future events or otherwise.

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