-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, EsczHqnVfrrnjNNqaApgAo30KY2OiLww9k3vsdNNERnfr/Xg7G9SAeobQR7OVAfY oiJZLBU290fmMvYr9v3vfw== /in/edgar/work/0001095811-00-004041/0001095811-00-004041.txt : 20001025 0001095811-00-004041.hdr.sgml : 20001025 ACCESSION NUMBER: 0001095811-00-004041 CONFORMED SUBMISSION TYPE: S-3/A PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20001024 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AVIRON CENTRAL INDEX KEY: 0000949173 STANDARD INDUSTRIAL CLASSIFICATION: [2836 ] IRS NUMBER: 770309686 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3/A SEC ACT: SEC FILE NUMBER: 333-45072 FILM NUMBER: 745062 BUSINESS ADDRESS: STREET 1: 297 N BERNARDO AVE CITY: MOUNTAIN VIEW STATE: CA ZIP: 94043 BUSINESS PHONE: 6509196500 MAIL ADDRESS: STREET 1: 297 NORTH BERNARDO AVE CITY: MOUNTAIN VIEW STATE: CA ZIP: 94043 S-3/A 1 f65344a1s-3a.txt AMENDMENT NO.1 TO FORM S-3 1 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 24, 2000 REGISTRATION NO. 333-45072 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------ AMENDMENT NO. 1 TO FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------------------ AVIRON (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) DELAWARE 77-0309686 (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
297 NORTH BERNARDO AVENUE MOUNTAIN VIEW, CALIFORNIA 94043 (650) 919-6500 (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES) C. BOYD CLARKE PRESIDENT AND CHIEF EXECUTIVE OFFICER AVIRON 297 NORTH BERNARDO AVENUE MOUNTAIN VIEW, CALIFORNIA 94043 (650) 919-6500 (NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE) COPY TO: ROBERT J. BRIGHAM, ESQ. COOLEY GODWARD LLP FIVE PALO ALTO SQUARE 3000 EL CAMINO REAL PALO ALTO, CALIFORNIA 94306 (650) 843-5000 APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC: As soon as practicable after the effective date of this Registration Statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, as amended, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. [X] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If this Form is to be a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement of the earlier effective registration statement for the same offering. [ ] If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. [ ] CALCULATION OF REGISTRATION FEE - ----------------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------- PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF TITLE OF SHARES TO BE AMOUNT TO BE OFFERING PRICE AGGREGATE REGISTRATION REGISTERED REGISTERED PER SHARE(1) OFFERING PRICE(1) FEE(2) - ----------------------------------------------------------------------------------------------------------------------- Common stock, $0.001 par value........................ 1,101,397 shares $39.625-$56.8125 $44,728,454 $11,809 - ----------------------------------------------------------------------------------------------------------------------- - -----------------------------------------------------------------------------------------------------------------------
(1) Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(c) under the Securities Act of 1933 on the basis of the high and low prices of Aviron's common stock on August 25, 2000 and October 18, 2000 as quoted on the Nasdaq National Market. It is not known how many shares will be purchased under this Registration Statement or at what price shares will be purchased. (2) $10,861 of the Registration Fee was previously paid with Aviron's initial filing of this Registration Statement on September 1, 2000, which registered 1,038,235 shares of Aviron's common stock. THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT THAT SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 2 THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THE SELLING STOCKHOLDERS MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED. SUBJECT TO COMPLETION, DATED OCTOBER 24, 2000 PROSPECTUS AVIRON 1,101,397 SHARES COMMON STOCK These shares of common stock are being offered by the selling stockholders, identified in this prospectus. The selling stockholders may sell the shares of common stock in a number of different ways and at varying prices. We provide more information about how they may sell their shares in the section entitled "Plan of Distribution" on page 14. We are not selling any shares of our common stock under this prospectus and will not receive any portion of the proceeds from the sale of these shares. Aviron's common stock is traded on the Nasdaq National Market under the symbol "AVIR". On October 23, 2000, the last reported sale price for our common stock on the Nasdaq National Market was $60.625 per share. INVESTING IN SECURITIES ISSUED BY AVIRON INVOLVES CERTAIN RISKS. SEE "RISK FACTORS" BEGINNING ON PAGE 4. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THE SECURITIES OR PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. THE DATE OF THIS PROSPECTUS IS , 2000 3 TABLE OF CONTENTS
PAGE NUMBER ------ WHERE YOU CAN FIND MORE INFORMATION......................... 1 SUMMARY..................................................... 2 THE COMPANY................................................. 2 RISK FACTORS................................................ 4 SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS........... 12 USE OF PROCEEDS............................................. 12 SELLING STOCKHOLDERS........................................ 13 PLAN OF DISTRIBUTION........................................ 14 LEGAL MATTERS............................................... 15 EXPERTS..................................................... 15
You should rely only on the information contained in, or incorporated into this prospectus. We have not authorized anyone to provide you with information different from that contained in this prospectus. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of common stock. We own or have rights to trademarks or trade names that we use in conjunction with the operation of our business. We own the FluMist trademark in the United States. This prospectus also includes trademarks owned by other parties. i 4 WHERE YOU CAN FIND MORE INFORMATION We are a reporting company and file annual, quarterly and current reports, proxy statements and other information with the Securities and Exchange Commission, or the SEC. You may read and copy these reports, proxy statements and other information at the SEC's public reference rooms in Washington, D.C., New York, NY and Chicago, IL. You can request copies of these documents by writing to the SEC and paying a fee for the copying cost. Please call the SEC at 1-800-SEC-0330 for more information about the operation of the public reference rooms. Our SEC filings are also available at the SEC's Web site at "http://www.sec.gov". In addition, you can read and copy our SEC filings at the office of the National Association of Securities Dealers, Inc. at 1735 K Street, Washington, D.C. 20006. The SEC allows us to "incorporate by reference" 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 an important part of this prospectus, and information that we file later with the SEC will automatically update and supersede this information. Further, all filings we make under the Securities Exchange Act after the date of the initial registration statement and prior to effectiveness of the registration statement shall be deemed to be incorporated by reference into this prospectus. We incorporate by reference the documents listed below and any future filings we will make with the SEC under Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934: 1. Our Annual Report on Form 10-K for the year ended December 31, 1999, filed with the SEC on March 8, 2000, and amended by a Form 10-K/A filed with the SEC on April 3, 2000 and April 28, 2000; 2. Our Definitive Proxy Statement dated May 4, 2000, filed with the SEC on May 4, 2000, in connection with our 2000 Annual Meeting of Stockholders; 3. Our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2000 and June 30, 2000, filed with the SEC on May 15, 2000 and August 11, 2000, respectively; 4. Our Current Report on Form 8-K dated June 12, 2000, filed with the SEC on June 13, 2000; 5. Our Current Report on Form 8-K dated October 10, 2000, filed with the SEC on October 19, 2000; and 6. The description of our common stock set forth in our Registration Statement on Form 8-A, filed with the SEC on July 16, 1996. We will provide to you at no cost a copy of any and all of the information incorporated by reference into the registration statement of which this prospectus is a part. You may make a request for copies of this information in writing or by telephone. Requests should be directed to: Aviron Attention: Investor Relations 297 North Bernardo Avenue Mountain View, CA 94043 (650) 919-6500 1 5 SUMMARY This prospectus contains forward-looking statements which involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors appearing under "Risk Factors" and elsewhere in this prospectus. The following summary does not contain all the information that may be important to you. You should read the entire prospectus, including the financial statements and other information incorporated by reference in this prospectus, before making an investment decision. THE COMPANY We are a biopharmaceutical company focused on the prevention of disease through innovative vaccine technology. We are currently focusing our product development and commercialization efforts on our lead product candidate, FluMist, an investigational intranasal live virus vaccine for influenza. Our goal is to become a leader in the discovery, development, manufacture and marketing of innovative development vaccines. Our vaccine development programs are based both on techniques for producing weakened live virus vaccines and on our proprietary genetic engineering technologies. Live virus vaccines, including those for smallpox, polio, measles, mumps, rubella and chicken pox, have had a long record of preventing disease. According to the Centers for Disease Control and Prevention, or CDC, epidemics of influenza occur during the winter months nearly every year and are responsible for an average of approximately 20,000 deaths per year in the United States. Influenza viruses also can cause global epidemics of disease during which rates of illness and death from influenza-related complications can increase dramatically. Influenza viruses cause disease in all age groups. Rates of infection are highest among children, but rates of serious illness and death are highest among persons over age 64, and persons of any age who have medical conditions that place them at high risk for complications from influenza. FluMist is designed to prevent influenza. We are developing and intend to commercialize FluMist primarily in collaboration with our partner Wyeth Lederle Vaccines, a business unit of the pharmaceutical division of American Home Products Corporation, or AHP. FluMist has been shown to provide a high protection rate against influenza in Phase 3 clinical trials in children and healthy adults. In a separate trial conducted in healthy working adults, reductions in days of illness, antibiotic use, health resource use and missed work because of illness were observed across several illness definitions. We are in the process of obtaining approval of FluMist from the U.S. Food and Drug Administration, or FDA. This approval process requires us to submit to the FDA our clinical data, together with, among other things, detailed information on the manufacture and composition of FluMist, in the form of a biologics license application, or BLA. The FDA notified us in 1998 that, in order to support a BLA filing for FluMist, we must demonstrate the clinical equivalence between FluMist produced in our new manufacturing facility located in Pennsylvania and FluMist used in our Phase 3 trials. We must also provide additional data on manufacturing validation and stability. In June 1999, we reported the results of a clinical trial that we believe demonstrated the required clinical equivalence. We are in the process of completing the manufacturing validation exercises, stability studies and documentation we believe necessary to support a BLA for FluMist, which we intend to submit during the fourth quarter of 2000. Influenza vaccination rates for healthy children are substantially below those for the general population. In addition, the majority of healthy adults currently do not receive the influenza vaccine. We believe that there are significant market opportunities for FluMist in these two populations. We believe FluMist can achieve significant market acceptance because: - In clinical trials, FluMist provided protection rates as high as 93% in healthy children and 85% in healthy adults; 2 6 - FluMist is a nasal spray which pediatricians, parents and vaccine recipients may find as an attractive new way to prevent influenza; - In a large clinical trial, FluMist helped reduce the incidence of middle ear infections in children and the associated antibiotic use; - As noted in a recent article in the Journal of Pediatrics, FluMist is a weakened live virus vaccine which triggers an immune response similar to the natural immune response to influenza, while the response to the flu shot is more narrowly focused; - FluMist stimulates immunity in the nose and throat, the point of contact for airborne infections such as influenza, as well as in the bloodstream; and - FluMist has been administered to more than 13,000 people with no serious adverse events associated with use of the vaccine. The current formulation of FluMist requires freezer storage throughout distribution. Because international markets do not have distribution channels well suited to the sale of frozen vaccines, Wyeth Lederle has initiated a Phase 2 clinical trial outside of the United States for our second generation refrigerator stable, or liquid, formulation of FluMist. We also have a number of other vaccines in various stages of development: - a parainfluenza virus type 3 vaccine to prevent the most common cause of croup, a respiratory infection in infants, for which we have completed a successful Phase 2 clinical trial; - an Epstein-Barr virus vaccine to prevent infectious mononucleosis for which our collaborative partner, SmithKline Beecham Biologicals S.A., has completed a successful Phase 1 clinical trial; and - a vaccine for cytomegalovirus, the leading infectious cause of birth defects, for which clinical testing began during the second quarter of 2000. We are also using our proprietary vaccine design technologies to develop new vaccines, including vaccine candidates for herpes simplex virus type 2, the virus responsible for genital herpes, and respiratory syncytial virus, a virus responsible for a severe lower respiratory infection in infants and young children. We were incorporated in California in April 1992, and reincorporated in Delaware in November 1996. Our executive offices are located at 297 North Bernardo Avenue, Mountain View, California 94043 and our telephone number is (650) 919-6500. Aviron's World Wide Web address is http://www.aviron.com. Information contained in our World Wide Web site should not be considered to be part of this prospectus. 3 7 RISK FACTORS You should carefully consider the risks described below before making an investment decision. The risks described below are not the only ones facing our company. Additional risks not presently known to us or that we currently deem immaterial may also impair our business operations. Our business, financial condition or results of operations could be materially adversely affected by any of these risks. The trading price of our common stock could decline due to any of these risks, and you may lose all or part of your investment. This prospectus also contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including the risks faced by us described below and elsewhere in this prospectus. RISKS RELATED TO FLUMIST For the foreseeable future, the risks relating to Aviron are primarily those related to the development and commercialization of FluMist. All of our potential near-term revenues are dependent on the commercialization of FluMist. Because of the seasonality of influenza, FluMist must be available in the third or fourth quarter of the year for us to achieve revenues for that season. Delay in availability of FluMist in the initial year of commercialization or in subsequent years could cause us to lose revenues for an entire influenza season and require us to raise additional capital to cover the costs of additional research and development, related expenses and ongoing fixed costs. POSTPONING THE SUBMISSION OF OUR APPLICATION TO THE FDA FOR FLUMIST WILL DELAY THE COMMERCIALIZATION OF FLUMIST. In 1998, we submitted an application for FluMist, which was not accepted for filing by the FDA. Additional information required before we resubmit our application includes data on manufacturing validation, stability and clinical equivalence. If our manufacturing validation exercises and studies to confirm sufficient shelf-life stability are not successful, or if our facilities validation is delayed, or we encounter additional problems, we will postpone our submission beyond 2000, which will delay commercialization of FluMist. IF THE FDA FINDS THAT OUR APPLICATION FOR FLUMIST DOES NOT SUPPORT APPROVAL, OR IF ITS INSPECTORS FIND THAT OUR MANUFACTURING FACILITIES ARE NOT ADEQUATE, COMMERCIALIZATION OF FLUMIST MAY BE DELAYED BY ONE OR MORE INFLUENZA SEASONS. Approval risk related to manufacturing. If the FDA finds that the validation, clinical or other required data in our application is insufficient, it could refuse to accept our application for filing or could require corrective action or additional data which could delay or prevent approval. The FDA is likely to inspect each of the facilities involved in manufacturing FluMist. FDA inspectors may find deficiencies in the facilities or processes that may lead to delay in FluMist approval or prevent it from being approved at all. Celltech Medeva, or Medeva, the international marketing arm of Celltech Group, plc, notified us that it received a warning letter from the FDA regarding their United Kingdom facility where several key stages of the FluMist manufacturing process take place. Some of the comments in the letter referred to the general utility systems in the facility, such as water and clean steam, which are used to prepare supplies used in the manufacture of FluMist. We have been informed by Medeva that it is taking the necessary steps to bring its systems and facility into compliance, and it is working with the FDA to fulfill that objective. While we believe Medeva has taken the necessary steps to bring the relevant general utility systems into compliance, we have also begun to implement plans to eliminate our dependence on these utilities in connection with our planned fourth quarter 2000 BLA 4 8 submission. Those plans, which will require FDA approval, involve the use of disposable supplies, instead of relying on the shared utility systems at Medeva. Approval risk related to FluMist indications and claims. We are initially seeking FDA approval for use of FluMist in children and healthy adults. The FDA may not find our clinical data adequate to support use in any particular group and may exclude any segment of the population. The FDA may request additional clinical data to support the safety of FluMist. We may be required to commence and complete additional clinical trials to generate additional data to support product approval for one or more of our target populations, which may lead to substantial delay in FluMist approval or prevent it from being approved for any of those population segments. IF WE ARE UNABLE TO PERFORM THE COMPLEX ANNUAL UPDATE OF THE FLUMIST FORMULATION FOR NEW INFLUENZA STRAINS IN A TIMELY MANNER, OUR SALES FOR THAT YEAR WILL BE LIMITED OR WE MAY HAVE NO SALES AT ALL. Early each year, the FDA determines which strains will be included in the upcoming season's influenza vaccines. After the FDA makes its decision, we will have approximately six months to include the selected strains and manufacture FluMist for use in the upcoming influenza season. The major factors that may delay availability of FluMist each year are: - The FDA may delay its selection of strains for a given influenza season. - We may experience difficulty or delay in the technically demanding process we follow each year to update the formulation of FluMist. - The FDA could require as a release test a brief clinical trial designed to show the safety and activity of the vaccine including the new strains selected for that particular year. IF WE HAVE DIFFICULTIES WITH OUR MANUFACTURING PROCESS, WE MAY NOT HAVE SUFFICIENT QUANTITIES OF VACCINE. We may not have sufficient quantities of vaccine in time to assure availability for the season due to problems with updated strains or performance of suppliers or contract manufacturers. Following inoculation with our updated strains, bulk vaccine is harvested from special hens' eggs. This is a labor-intensive process which must be conducted under strict controls and tight timelines. We are dependent on our contract manufacturer for successful staffing, training and supervision for this process. We are currently dependent on a single supplier for an adequate and timely supply of eggs. We may have difficulty with the blending, filling and packaging of FluMist. The bulk vaccine for three strains of influenza must be diluted and blended together prior to filling the nasal spray device. This process must be conducted under strict controls and tight timelines. We depend upon a single supplier for our nasal spray device. We also depend upon our packaging contractor for packaging of the vaccine. The vaccine is subject to strict quality control testing during production and prior to release. Any quality control failures could lead to a reduction in the available supply of FluMist. IF THE MARKET DEMAND FOR FLUMIST EXCEEDS OUR MANUFACTURING CAPACITY, OUR REVENUE MAY BE LIMITED. We may be capacity constrained in our supply of vaccine. In order to secure future production capacity, we may extend and expand existing arrangements, collaborate with other third parties, or establish additional manufacturing facilities. Using an alternative supplier or building a new facility would require a substantial amount of funds and additional clinical trials and testing. We cannot be sure that an additional source of supply will be established on a timely basis, or that we will have or be able to obtain funds sufficient for building or equipping a new facility. 5 9 THE SUCCESS OF FLUMIST IS HIGHLY DEPENDENT ON OUR PARTNER, WYETH LEDERLE, FOR MARKETING, PROMOTION, SALES AND DISTRIBUTION ACTIVITIES. We have entered into an exclusive agreement with Wyeth Lederle to co-promote, sell, and distribute FluMist. We believe that for FluMist to be widely adopted, the efforts of an experienced pharmaceutical sales force are needed. If Wyeth Lederle fails to devote appropriate resources to promote, sell, and distribute FluMist, sales of FluMist could be reduced. Distribution of FluMist will be challenging for several reasons. First, influenza vaccine is a seasonal product with a shipping period between August and January. Second, FluMist is a frozen product and must remain frozen prior to use. It must be maintained under recommended frozen storage conditions. Although Wyeth Lederle has a distribution system that supports frozen vaccines, if it does not manage these distribution challenges our revenues could be reduced. Wyeth Lederle also will participate in the development, manufacturing, promoting, and selling of a liquid formulation of FluMist, which will be particularly important if FluMist is to be accepted outside of the United States. If Wyeth Lederle does not devote sufficient resources to the development and commercialization of this formulation, its commercial availability will be delayed. If Wyeth Lederle breaches or terminates its agreement with us or otherwise fails to conduct their FluMist related activities in a timely manner or if there is a dispute about our or their respective obligations, we may need to seek another partner. If any of these events occurs, revenues associated with milestone payments or FluMist commercialization could be delayed, reduced or be substantially more expensive for us to achieve. IF MEDICAL ADVISORY BODIES, DOCTORS, AND OTHER HEALTH CARE PROVIDERS DO NOT RECOMMEND FLUMIST ITS MARKET OPPORTUNITY WILL BE LIMITED. We believe recommendations from advisory bodies such as the Advisory Committee on Immunization Practices, or ACIP, of the CDC, and the American Academy of Pediatrics, or AAP, will be important to encourage doctors and other healthcare providers to recommend FluMist. If these bodies do not recommend FluMist, the product's market opportunity will be limited. We will also need to educate doctors and other healthcare advisors of the safety and clinical efficacy of FluMist and its potential advantages over other influenza vaccines. WHETHER OR NOT DOCTORS, OTHER HEALTH CARE PROVIDERS AND MEDICAL ADVISORY BODIES RECOMMEND FLUMIST, IF THE MARKET DOES NOT ACCEPT FLUMIST, OUR SALES WILL BE REDUCED. FluMist acceptance may be limited by a number of factors, including: - perceived effectiveness of competing influenza vaccines, including the shot; - unfavorable publicity concerning other vaccines; - pricing of FluMist; - broad accessibility to FluMist; - reimbursement polices of government and third-party payors; - side effects, such as the runny nose, sore throat or fever seen in some clinical trial participants; and - the requirement of frozen storage capacity by those distributing and administering the vaccine. WE FACE COMPETITION FROM COMPANIES WITH SUBSTANTIAL FINANCIAL, TECHNICAL, AND MARKETING RESOURCES, WHICH COULD SERIOUSLY LIMIT OUR FUTURE REVENUES FROM FLUMIST. FluMist will be competing against the flu shot, which is sold by large pharmaceutical companies, including Wyeth Lederle and Medeva. 6 10 We also operate in a rapidly evolving field. Other companies are working to improve the efficacy of flu shots. In addition, we are aware of efforts to develop non-injectable influenza vaccines that would be more directly competitive with FluMist. For example: - A nasally administered inactivated vaccine is being developed by Biovector Therapeutics, S.A. and Biochem Pharma, Inc. which has been licensed to SmithKline Beecham; and - A nasally administered live influenza vaccine has been developed and used in Russia. In 1999, the FDA approved two new products for the treatment of influenza: zanamivir and oseltamivir. Zanamivir is marketed as Relenza and is sold by Glaxo Wellcome plc and oseltamivir is marketed as Tamiflu and is sold by Roche Holdings AG. These products inhibit the ability of the influenza virus to replicate. Both zanamivir, delivered via an inhaled powder, and oseltamivir, a pill, were approved for influenza treatment, but neither are approved for the prevention of influenza. When administered within two days of contracting influenza, zanamivir and oseltamivir may reduce the duration of influenza by approximately one day. Clinical data also has shown that taking zanamivir or oseltamivir daily for a period of time during the influenza season can have a preventative effect. THE FLUMIST MASTER DONOR STRAINS ARE NOT PROTECTED BY PATENTS AND IF THE STRAINS ARE DUPLICATED, THIRD PARTIES MAY BE ABLE TO DEVELOP, MARKET AND SELL A COMPETING VACCINE. We have no issued patents covering the FluMist master donor strains. Our rights to the master donor strains are substantially based on (1) an exclusive worldwide license of materials and know-how from the University of Michigan, which owns the master donor strains from which our vaccine is derived; and (2) an exclusive license of know-how and clinical trial data from the National Institutes of Health, or NIH. Neither the University of Michigan nor the NIH has been issued any patents covering the master donor strains. A third party may gain access by some means to the University of Michigan master donor strains and attempt to reproduce FluMist or develop another live virus influenza vaccine that might be comparable to FluMist in terms of safety and effectiveness. FAILURE TO RAISE ADDITIONAL CAPITAL COULD DELAY FLUMIST COMMERCIALIZATION AND DELAY THE DEVELOPMENT OF A LIQUID FORMULATION OF FLUMIST AND OF OUR OTHER POTENTIAL PRODUCTS. Our operations to date have consumed substantial and increasing amounts of cash. As of June 30, 2000, we had an accumulated deficit of approximately $231.9 million. The negative cash flow from operations is expected to continue and to accelerate in the foreseeable future. The commercialization of FluMist requires substantial funds for manufacturing, continued clinical trial efforts and other commercialization activities. For the six months ended June 30, 2000, our research and development expenses and our general, administrative and marketing expenses, amounted to $35.1 million and $5.9 million, respectively. We expect to continue to incur significant operating expenses. We also expect to spend a substantial amount to develop a liquid formulation of FluMist. In addition, we expect to continue funding the research, preclinical testing and clinical trials necessary to develop our early-stage products. As of June 30, 2000, we have raised since inception $365.0 million through financing activities, such as sales of equity, convertible debt securities, and other debt financing, which included $102.0 million raised from equity financing during the six month period ended June 30, 2000. Additionally, our current revenues are comprised primarily of amounts earned as milestone payments and expense reimbursements under our FluMist collaboration agreement with Wyeth Lederle, and other revenues from other contracts and research grants. For the six month period ended June 30, 2000, our revenues amounted to $5.0 million, which primarily consisted of expense reimbursements under our agreement with Wyeth Lederle. Our future revenues will depend largely on the success of these collaboration arrangements, contracts and research grants. With respect to our collaboration agreement with Wyeth Lederle, our rights to receive milestone payments are all "event-driven." These payments are earned only upon our 7 11 successful completion of specific activities. We cannot be certain as to when, and if, these milestone payments will be realized. Under the agreement, the earliest of the milestone payments in the amount of $15.5 million is due upon acceptance by the FDA of the filing of our BLA, which is not expected to occur until sixty (60) days after the date of filing. We anticipate that the BLA will be submitted to the FDA during the fourth quarter of 2000. A milestone payment of $20.0 million is due upon obtaining FDA marketing approval for FluMist. The timing of receipt of this payment will depend on the progress of the regulatory review of the BLA. Additional milestone payments related to the submission and approval of FluMist for marketing in international markets, for expansions in labeling claims, and for the liquid formulation are dependent upon future governmental approvals or recommendations by medical advisory bodies and will not be received until these activities are successfully completed at some time after 2001. Additionally, due to the seasonal nature of FluMist, cash will not be generated from product sales until late each year. A significant amount of working capital will be required each year to provide for the payment of expenditures associated with the manufacturing of inventory and other operating and capital needs in advance of any product sales. Currently, we expect our existing cash, cash equivalents, short term investments, and proceeds generated from our collaborative arrangements and financing commitments, will enable us to maintain our current and planned operations through 2001. We expect that we will need to raise additional funds in the future. Our future capital requirements will depend upon many factors, including: - product commercialization activities; - time and costs involved in obtaining regulatory approvals; - increasing manufacturing capacity for FluMist; - the progress of preclinical testing and clinical trials; - continued scientific progress in the research and development of our vaccine programs; - our ability to establish and maintain collaborative arrangements; - the cost involved in preparing, filing, prosecuting, maintaining and enforcing patent claims; - the cost of constructing additional manufacturing facilities, should they be deemed necessary; and - the addition of other early-stage programs to our product pipeline. If adequate funds are not available, whether through our financing commitments, additional funding or our current capital sources, such as our collaboration arrangements, the commercialization of FluMist and the development of a liquid formulation of FluMist may be delayed, and we will be required to delay, reduce the scope of, or eliminate one or more of our research or development programs for our other products. We may also be required to obtain funds through collaborative agreements with others that may require us to relinquish rights to certain of our technologies, product candidates or products we would otherwise seek to develop or commercialize ourselves. If additional funds are raised by issuing equity or convertible securities, the percentage ownership in Aviron held by existing stockholders will be reduced. IF WE ARE UNABLE TO ATTRACT AND RETAIN ADDITIONAL QUALIFIED PERSONNEL, OUR ABILITY TO COMMERCIALIZE FLUMIST AND DEVELOP A LIQUID FORMULATION OF FLUMIST MAY BE DELAYED. Attracting and retaining significant additional qualified personnel will be critical to our success. To pursue the development and commercialization of FluMist, we will be required to hire additional qualified personnel, especially those with expertise in development, commercial-scale manufacturing, and quality functions. Expansion in these areas is also expected to require the addition of management personnel and the development of additional expertise by existing management 8 12 personnel. We face competition for qualified individuals from numerous pharmaceutical, biopharmaceutical and biotechnology companies. OTHER RISKS RELATED TO OUR COMPANY SAFETY OF VACCINES CAN ONLY BE DETERMINED AFTER WIDESPREAD USE IN THE POPULATION. A vaccine could be licensed by the FDA and still be associated with adverse events which reduce or eliminate revenue. For example, in 1998 the FDA approved the use of a vaccine to prevent infant diarrhea, but the product was subsequently withdrawn from the market due to a possible link between a serious bowel disorder and the vaccine. This adverse event occurred at a frequency that was not detectable in a typical clinical development program. In addition there are a number of theoretical risks related to live virus vaccines, including changing back to the naturally-occurring, or wild-type, and re-combining to form a new strain which may cause disease. Also, because of the way it works, a weakened live virus could make an individual more susceptible to secondary infection. In addition, a weakened live virus could cause disease resembling a wild-type virus infection in people with an immune system that is not working properly because of a pre-existing disease, HIV infection or drug treatment for cancer or organ transplantation. The potential for adverse events after introduction to the market is an issue for all vaccines, including FluMist. OTHER THAN FLUMIST, OUR PRODUCT CANDIDATES ARE AT EARLY STAGES OF DEVELOPMENT, AND IF WE ARE UNABLE TO SUCCESSFULLY DEVELOP AND COMMERCIALIZE PRODUCTS, WE WILL NOT GENERATE REVENUES FROM THESE PRODUCTS. To date, none of our product candidates has been commercialized. Other than FluMist, all of our product candidates are in early stages of development. We face the risk of failure normally found in developing biotechnology products based on new technologies. Successfully developing, manufacturing, introducing and marketing our early-stage product candidates will require several years and substantial additional capital. Moreover, we must demonstrate safety and efficacy and gain regulatory approval for these products. We are aware of several companies that are marketing or are in late-stage development of products that would be competitive with our early-stage product candidates. In 1996, we completed construction of a pilot manufacturing facility for our potential vaccine products other than FluMist. We currently do not have facilities to manufacture any of our other potential products in commercial quantities and have no experience with commercial manufacture of vaccine products. We are alternatively considering the use of contract manufacturers for the commercial production of our other potential products. We are aware of only a limited number of manufacturers that we believe have the ability and capacity to manufacture our other potential products in a timely manner. WE MAY NOT RECEIVE PATENT PROTECTION FOR OUR POTENTIAL PRODUCTS AND MANUFACTURING PROCESSES. Our success depends to a significant degree upon our ability to develop proprietary products. We seek to protect our technology and potential products, when possible, with patents and trade secrets. Since patent applications in the United States are maintained in secrecy until patents issue and since publication of discoveries in the scientific or patent literature often lag behind actual discoveries, we cannot be certain that we were the first to make the inventions covered by each of our pending patent applications or that we were the first to file patent applications for these inventions. The patent positions of biotechnology and pharmaceutical companies can be highly uncertain and involve complex legal and factual questions. Therefore, the breadth of claims allowed in biotechnology and pharmaceutical patents, or their enforceability, cannot be predicted. We cannot be sure that any of our owned or licensed patents or patent applications will issue or, if issued, will not be invalidated or circumvented, or that the rights granted by them will provide any protection or competitive advantages to us. 9 13 We own or have exclusive licenses to various issued patents and pending patent applications both in the United States Patent and Trademark Office and in several foreign patent offices. We attempt, when possible, to obtain exclusive patent protection covering each potential product we are developing. There can be no assurance that each product we are developing will be protected by or protectable by issued patents in any or all countries in which we intend to market the product, if approved for sale by regulatory authorities. We have no issued patents covering the FluMist master donor strains. Our rights to the master donor strains are substantially based on (1) an exclusive worldwide license of materials and know-how from the University of Michigan, which owns the master donor strains from which our vaccine is derived; and (2) an exclusive license of know-how and clinical trial data from the National Institutes of Health, or NIH. We have no issued patents covering the bovine parainfluenza strain we are developing. Our rights to the bovine parainfluenza strain are substantially based on an exclusive, worldwide Biological Materials License of materials, clinical data and research information from the United States Public Health Service. We do have issued patents and/or pending patent applications in the United States and abroad which we believe will provide patent protection for our CMV, HSV, RSV, and recombinant PIV program technologies. The European Patent Office has informed us of its intention to deny claims relating to methods and compositions of recombinant non-segmented negative-strand RNA viruses contained in one of our granted European patents. Although this decision will not affect our FluMist cold-adapted influenza product, it may affect the European patent protection afforded our other vaccine candidates, including recombinant RSV and recombinant PIV. OUR PRODUCTS COULD INFRINGE THE INTELLECTUAL PROPERTY RIGHTS OF OTHERS, CAUSING COSTLY LITIGATION AND THE LOSS OF SIGNIFICANT RIGHTS. Our success will also depend upon us not infringing patents issued to others. A number of pharmaceutical companies, biotechnology companies, universities and research institutions have filed patent applications or received patents in the areas of our research and development programs. Some of these patent applications or patents may limit the scope of claims issuing from our patent applications, prevent certain claims from being issued, or conflict in certain respects with claims made under our applications. OUR BUSINESS EXPOSES US TO PRODUCT LIABILITY CLAIMS AND THE DEFENSE OR LOSS OF ANY SUCH CLAIM COULD BE COSTLY. Our business exposes us to potential product liability risks that are inherent in the testing, manufacturing and marketing of vaccines. We have obtained clinical trial liability insurance for our clinical trials. We also intend to seek product liability insurance in the future for products approved for marketing. However, we cannot be sure that we will be able to acquire or maintain insurance at a reasonable cost or in sufficient amounts to protect us from liability risks. A successful product liability claim or a series of claims brought against us could seriously harm our business. We intend to seek inclusion of some of our products in the United States National Vaccine Injury Compensation Program, a no-fault compensation program for claims against vaccine manufacturers, which administers a trust funded by excise taxes on sales of a number of recommended childhood vaccines. We cannot be sure that this government program will continue or that our proposed vaccines will be included in the program. WE USE HAZARDOUS MATERIALS IN OUR BUSINESS AND AN ACCIDENT COULD BE COSTLY. Our business activities involve the controlled use of hazardous materials, chemicals, various radioactive substances and viruses. Although we believe that our safety procedures for handling and disposing of these materials comply with state and federal regulations, the risk of accidental contamination or injury from these materials cannot be completely eliminated. In the event of such an accident, we could be held liable for any damages that result and any such liability would seriously 10 14 harm our business. In addition, we may incur substantial costs to comply with environmental regulations if we develop manufacturing capacity. RISKS RELATED TO THIS OFFERING OUR STOCK PRICE IS VOLATILE AND YOU MAY LOSE ALL OR A PART OF YOUR INVESTMENT. The market price of our common stock has fluctuated significantly to date. As a result you may be unable to sell your shares of common stock at or above the offering price. The market price of the common stock may fluctuate significantly in response to the following factors, most of which are beyond our control: - variations in our quarterly operating results; - changes in securities analysts' estimates of our financial performance; - changes in market valuations of similar companies; - announcements by us or our competitors of significant contracts, acquisitions, strategic partnerships, joint ventures or capital commitments; - additions or departures of key personnel; and - fluctuations in stock market price and volume, which are particularly common among securities of biopharmaceutical companies. WE ARE AT RISK OF SECURITIES CLASS ACTION LITIGATION DUE TO OUR EXPECTED STOCK PRICE VOLATILITY. In the past, securities class action litigation has often been brought against a company following a decline in the market price of its securities. This risk is especially relevant for us because biopharmaceutical companies have experienced greater than average stock price volatility in recent years and, as a result, have been subject to, on average, a greater number of securities class action claims than companies in other industries. We may in the future be the target of similar litigation. Securities litigation could result in substantial costs and divert management's attention and resources, and could seriously harm our business. WE HAVE IMPLEMENTED PROVISIONS IN OUR CHARTER DOCUMENTS WHICH MAY ULTIMATELY DELAY, DISCOURAGE OR PREVENT A CHANGE IN MANAGEMENT OR CONTROL OF AVIRON. Provisions of our amended and restated certificate of incorporation and bylaws could make it more difficult for our stockholders to replace or remove our directors, or to effect any corporate action. These provisions include those which: - establish a classified board of directors requiring that members of only one of the three classes of directors be elected at one time; - prohibit cumulative voting in the election of directors, which would otherwise allow less than a majority of stockholders to elect director candidates; - prohibit holders of less than ten percent of our outstanding capital stock from calling special meetings of stockholders; - prohibit stockholder action by written consent, thereby requiring all stockholder actions to be taken at a meeting of our stockholders; and - establish advance notice requirements for nominations for election to the board of directors or for proposing matters that can be acted upon by stockholders at stockholder meetings. Some of the above provisions may also have possible anti-takeover effects, which may make an acquisition of Aviron by a third party more difficult, even if such an acquisition could be beneficial to our stockholders. Additionally, our share purchase rights plan, commonly referred to as a "poison pill," and the terms of our stock option plans, may discourage or delay a change in control of Aviron. 11 15 SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS Some of the statements in the sections entitled "Summary," "Risk Factors," and elsewhere in this prospectus constitute forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause our or our industry's results, levels of activity, or achievements to be materially different from any future results, levels of activity or achievements expressed or implied by such forward-looking statements. Such factors include, among others, those listed under "Risk Factors" and elsewhere in this prospectus. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "intend," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential," or "continue," or the negative of such terms or other comparable terminology. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, events, levels of activity, performance or achievements. USE OF PROCEEDS We will not receive any of the proceeds from the sale of shares of common stock offered by the selling stockholders. 12 16 SELLING STOCKHOLDERS We sold to American Home Products Corporation shares of common stock in a series of private placements. We issued to Evans Vaccines Limited, or Evans, warrants to purchase common stock in connection with the amendment of a manufacturing agreement relating to FluMist. Though Evans may exercise the warrants in full immediately, market standoff provisions allow Evans to sell only 1/6th of the underlying shares immediately, with an additional 1/6th of the shares becoming free for sale by Evans on each of the subsequent five anniversaries of the date of the warrants. We issued to the other selling stockholders common stock upon the exercise of warrants in connection with the licensing of technology relating to recombinant negative strand RNA virus expression systems and vaccines, and attenuated influenza viruses. We agreed to register all of the above common stock and the shares of common stock issuable upon the exercise of the above warrants. The shares being registered represent approximately 4.8 percent of our outstanding capitalization as of October 20, 2000. The following table sets forth information known to us with respect to beneficial ownership of our common stock as of August 30, 2000 by each selling stockholder, except Evans Vaccines Limited, which is as of October 20, 2000. The following table assumes that the selling stockholders sell all of the shares. We are unable to determine the exact number of shares that actually will be sold. Beneficial ownership is determined in accordance with the rules of the SEC and includes sole or shared voting or investment power with respect to shares shown as beneficially owned. Percentage ownership is based on 22,868,029 shares of common stock outstanding as of October 20, 2000. Unless otherwise indicated, the address for each of the individuals listed in the table is c/o Aviron, 297 North Bernardo Avenue, Mountain View, California 94043.
SHARES BENEFICIALLY SHARES BENEFICIALLY OWNED PRIOR OWNED SUBSEQUENT TO THE OFFERING SHARES OFFERED TO THE OFFERING -------------------- BY THIS ------------------- NAME AND ADDRESS OF SELLING STOCKHOLDER SHARES PERCENT PROSPECTUS SHARES PERCENT - --------------------------------------- -------- -------- -------------- ------- -------- American Home Products Corporation... 996,840 4.36% 996,840 0 * 5 Giralda Farms Madison, New Jersey 07940 Evans Vaccines Limited(1)............ 63,162 * 63,162 0 * Florey House, Robert Robinson Avenue, Oxford Science Park, Oxford OX44GA England Mount Sinai School of Medicine(2).... 50,642 * 27,309 23,333 * 633 Third Avenue New York, New York 10017 Mark Krystal......................... 5,338 * 3,758 1,580 * Jeffrey David Parvin................. 4,695 * 4,695 0 * Michael Bergmann..................... 2,669 * 1,503 1,166 * Thomas Muster........................ 2,668 * 1,502 1,166 * Reinhard Vlasak(3)................... 2,001 * 1,126 875 * Masayoshi Emami(4)................... 1,502 * 1,502 0 *
- ------------------------- * Less than 1% of the outstanding shares of common stock. (1) Includes 63,162 shares issuable upon exercise of warrants held by this selling stockholder. (2) Includes 23,976 shares issuable upon exercise of warrants held by this selling stockholder. (3) Includes 901 shares issuable upon exercise of warrants held by this selling stockholder. (4) Includes 1,202 shares issuable upon exercise of warrants held by this selling stockholder. 13 17 We are registering the shares for resale by the selling stockholders in accordance with registration rights granted to the selling stockholders. We will pay the registration and filing fees, printing expenses, listing fees, blue sky fees, if any, and fees and disbursements of our counsel in connection with this offering, but the selling stockholders will pay any underwriting discounts, selling commissions and similar expenses relating to the sale of the shares. In addition, we have agreed to indemnify the selling stockholders against certain liabilities, including liabilities under the Securities Act, in connection with this offering. The selling stockholders have agreed to indemnify us and our directors and officers, as well as any person that controls us, against certain liabilities, including liabilities under the Securities Act. Insofar as indemnification for liabilities under the Securities Act may be permitted to our directors or officers, or persons that control us, we have been informed that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable. PLAN OF DISTRIBUTION The selling stockholders, or, subject to applicable law, their pledgees, donees, distributees, transferees or other successors in interest, may sell shares from time to time in public transactions, on or off the Nasdaq National Market, or private transactions, at prevailing market prices or at privately negotiated prices, including but not limited to, one or any combination of the following types of transactions: - ordinary brokers' transactions; - transactions involving cross or block trades or otherwise on the Nasdaq National Market; - purchases by brokers, dealers or underwriters as principal and resale by these purchasers for their own accounts pursuant to this prospectus; - "at the market," to or through market makers, or into an existing market for our common stock; - in other ways not involving market makers or established trading markets, including direct sales to purchasers or sales effected through agents; - through transactions in options, swaps or other derivatives (whether exchange-listed or otherwise); - in privately negotiated transactions; or - to cover short sales. In effecting sales, brokers or dealers engaged by the selling stockholders may arrange for other brokers or dealers to participate in the resales. The selling stockholders may enter into hedging transactions with broker-dealers, and in connection with those transactions, broker-dealers may engage in short sales of the shares. The selling stockholders also may sell shares short and deliver the shares to close out such short positions. The selling stockholders also may enter into option or other transactions with broker-dealers that require the delivery to the broker-dealer of the shares, which the broker-dealer may resell pursuant to this prospectus. The selling stockholders also may pledge the shares to a broker or dealer. Upon a default, the broker or dealer may effect sales of the pledged shares pursuant to this prospectus. Brokers, dealers or agents may receive compensation in the form of commissions, discounts or concessions from selling stockholders in amounts to be negotiated in connection with the sale. The selling stockholders and any participating brokers or dealers may be deemed to be "underwriters" within the meaning of the Securities Act in connection with such sales. In such event, any commission, discount or concession these "underwriters" receive may be deemed to be underwriting compensation. 14 18 To the extent required, the following information will be set forth in a supplement to this prospectus: - information as to whether underwriters who the selling stockholders may select, or any other broker-dealer, is acting as principal or agent for the selling stockholders; - the compensation to be received by underwriters that the selling stockholders may select or by any broker-dealer acting as principal or agent for the selling stockholder; and - the compensation to be paid to other broker-dealers, in the event the compensation of such other broker-dealers is in excess of usual and customary commissions. Any dealer or broker participating in any distribution of the shares may be required to deliver a copy of this prospectus, including a prospectus supplement, if any, to any person who purchases any of the shares from or through this dealer or broker. We have advised the selling stockholders that they are required to comply with Regulation M promulgated under the Securities Exchange Act during such time as they may be engaged in a distribution of the shares. With some exceptions, Regulation M precludes any selling stockholders, any affiliated purchasers and any broker-dealer or other person who participates in such distribution from bidding for or purchasing, or attempting to induce any person to bid for or purchase any security that is the subject of the distribution until the entire distribution is complete. Regulation M also prohibits any bids or purchases made in order to stabilize the price of a security in connection with the distribution of that security. All of the foregoing may affect the marketability of the common stock. We will not receive any of the proceeds from the selling stockholders' sale of our common stock. This registration statement will remain effective until the earlier of (a) the date when all of the shares registered by this registration statement have been distributed to the public, or (b) the date the shares of common stock are eligible for sale in their entirety under Rule 144. In the event that any shares remain unsold at the end of such period. We may file a post-effective amendment to the registration statement for the purpose of deregistering the shares registered by this prospectus. LEGAL MATTERS For the purpose of this offering, Cooley Godward LLP, Palo Alto, California is giving an opinion of the validity of the issuance of the common stock offered in this prospectus. EXPERTS Ernst & Young LLP, independent auditors have audited our financial statements included in our Annual Report on Form 10-K/A for the year ended December 31, 1999, as set forth in their report, which is incorporated by reference in this prospectus and elsewhere in the registration statement. Our financial statements are incorporated by reference in reliance on Ernst & Young LLP's report, given on their authority as experts in accounting and auditing. 15 19 PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION Securities and Exchange Commission Registration Fee......... $10,861 Legal Fees and Expenses..................................... 25,000 Accountants' Fees and Expenses.............................. 15,000 Miscellaneous............................................... 4,139 ------- Total..................................................... $55,000 =======
The foregoing items, except for the Securities and Exchange Commission Registration Fee are estimated. ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS Under Section 145 of the Delaware General Corporation Law, Aviron has broad powers to indemnify its directors and officers against liabilities they may incur in such capacities, including liabilities under the Securities Act of 1933. Aviron's certificate of incorporation and by-laws include provisions to (1) eliminate the personal liability of its directors for monetary damages resulting from breaches of their fiduciary duty to the extent permitted by Section 102(b)(7) of the General Corporation Law of Delaware and (2) require Aviron to indemnify its directors and officers to the fullest extent permitted by Section 145 of the Delaware Law, including circumstances in which indemnification is otherwise discretionary. Pursuant to Section 145 of the Delaware Law, a corporation generally has the power to indemnify its present and former directors, officers, employees and agents against expenses incurred by them in connection with any suit to which they are, or are threatened to be made, a party by reason of their serving in such positions so long as they acted in good faith and in a manner they reasonably believed to be in, or not opposed to, the best interest of the corporation, and with respect to any criminal action, they had no reasonable cause to believe their conduct was unlawful. Aviron believes that these provisions are necessary to attract and retain qualified persons as directors and officers. These provisions do not eliminate the directors' duty of care, and, in appropriate circumstances, equitable remedies such as injunctive or other forms of non-monetary relief will remain available under Delaware law. In addition, each director will continue to be subject to liability for breach of the directors' duty of loyalty to Aviron, for acts or omissions not in good faith or involving intentional misconduct, for knowing violations of law, for acts or omissions that the director believes to be contrary to the best interests of Aviron or its stockholders, for any transaction from which the director derived an improper personal benefit, for acts or omissions involving a reckless disregard for the directors' duty to Aviron or its stockholders when the director was aware or should have been aware of a risk of serious injury to Aviron or its stockholders, for acts or omissions that constitute an unexcused pattern of inattention that amounts to an abdication of the director's duty to Aviron or its stockholders, for improper transactions between the director and Aviron and for improper distributions to stockholders and loans to directors and officers. The provision also does not affect a director's responsibilities under any other law, such as the federal securities law or state or federal environmental laws. Aviron has entered into indemnity agreements with each of its directors and executive officers that require Aviron to indemnify such persons against expenses, judgments, fines, settlements and other amounts incurred(including expenses of a derivative action) in connection with any proceeding, whether actual or threatened, to which any such person may be made a party by reason of the fact that such person is or was a director or an executive officer of Aviron or any of its affiliated enterprises, provided such person acted in good faith and in a manner such persons reasonably believed to be in, or not opposed to, the best interests of Aviron and, with respect to any criminal II-1 20 proceeding, has no reasonable cause to believe his conduct was unlawful. The indemnification agreements also set forth procedures that will apply in the event of a claim for indemnification thereunder. At present, there is no pending litigation or proceeding involving a director or officer of Aviron as to which indemnification is being sought. Aviron has a liability policy covering the officers and directors of Aviron which includes liabilities arising under the Securities Act or otherwise. ITEM 16. EXHIBITS
EXHIBIT NUMBER DESCRIPTION OF DOCUMENT - ------- ----------------------- 4.2 Specimen Stock Certificate.(1) 4.8 Investors Rights Agreement, dated July 18, 1995, among the Company and the investors named therein.(1) 4.11 Common Stock Purchase Agreement, dated as of December 16, 1999, between the Company and American Home Products Corporation.(2) 4.12 Common Stock Purchase Agreement, dated as of December 30, 1999, between the Company and American Home Products Corporation.(2) 4.13 Common Stock Purchase Agreement, dated as of February 3, 2000, between the Company and American Home Products Corporation.(2) 4.15 Common Stock Purchase Agreement, dated as of April 5, 2000, between the Company and American Home Products Corporation.(3) 4.16 Registration Rights Agreement, dated October 10, 2000, by and between the Company and Evans Vaccines Limited. 5.1 Opinion of Cooley Godward LLP.(4) 23.1 Consent of Ernst & Young LLP, Independent Auditors. 23.2 Consent of Cooley Godward LLP. Reference is made to Exhibit 5.1. 24.1* Power of Attorney. See signature page.
- ------------------------- (1) Incorporated by reference to the correspondingly numbered exhibit to our Registration Statement on Form S-1, File No. 333-05209, filed June 5, 1996, as amended. (2) Incorporated by reference to the correspondingly numbered exhibit to our Annual Report on Form 10-K for the year ended December 31, 1999, File No. 0-20815, filed March 8, 2000. (3) Incorporated by reference to the correspondingly numbered exhibit to our Quarterly Report on Form 10-Q for the quarter ended March 31, 2000, File No. 0-20815, filed May 15, 2000. (4) This opinion amends and supercedes the opinion previously filed on September 1, 2000. * Previously filed. ITEM 17. UNDERTAKINGS Insofar as indemnification for liabilities arising under the Securities Act of 1933, may be permitted to directors, officers, and controlling persons of the Registrant pursuant to the provisions described in Item 15 or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer, or controlling person of the Registrant in the successful defense of any action suit, or proceeding) is asserted by such director, officer, or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the II-2 21 question whether such indemnification by it is against public policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such issue. The undersigned registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof; and (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. The undersigned Registrant hereby undertakes that, for the purposes of determining any liability under the Securities Act of 1933, each filing of the Registrant's annual report pursuant to Section 13(a) of Section 15(d) of the Securities Exchange Act of 1934 that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. The undersigned Registrant undertakes that; (1) for purpose of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of the registration statement in reliance upon Rule 430A and contained in the form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of the registration statement as of the time it was declared effective; and (2) for the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. II-3 22 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Registration Statement on Form S-3 to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Mountain View, County of Santa Clara, State of California, on October 24, 2000. AVIRON By: /s/ C. BOYD CLARKE ------------------------------------ C. Boyd Clarke President and Chief Executive Officer PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED, THIS REGISTRATION STATEMENT ON FORM S-3 HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE CAPACITIES AND ON THE DATES INDICATED.
SIGNATURE TITLE DATE --------- ----- ---- /s/ C. BOYD CLARKE President, Chief Executive Officer October 24, 2000 - ----------------------------------- and Director C. Boyd Clarke (Principal Executive Officer) /s/ FRED KURLAND Senior Vice President and October 24, 2000 - ----------------------------------- Chief Financial Officer Fred Kurland (Principal Financial and Accounting Officer) * Chairman of the Board October 24, 2000 - ----------------------------------- J. Leighton Read, M.D. Director - ----------------------------------- R. Gordon Douglas, Jr., M.D. * Director October 24, 2000 - ----------------------------------- Dennis M. Fenton, Ph.D. * Director October 24, 2000 - ----------------------------------- Wayne T. Hockmeyer, Ph.D. * Director October 24, 2000 - ----------------------------------- Paul H. Klingenstein * Director October 24, 2000 - ----------------------------------- Alan C. Mendelson * Director October 24, 2000 - ----------------------------------- Bernard Roizman, Sc.D. *By: /s/ C. BOYD CLARKE - ----------------------------------- C. Boyd Clarke Attorney-in-Fact
II-4 23 INDEX TO EXHIBITS
EXHIBIT NUMBER DESCRIPTION OF DOCUMENT - ------- ----------------------- 4.2 Specimen Stock Certificate.(1) 4.8 Investors Rights Agreement, dated July 18, 1995, among the Company and the investors named therein.(1) 4.11 Common Stock Purchase Agreement, dated as of December 16, 1999, between the Company and American Home Products Corporation.(2) 4.12 Common Stock Purchase Agreement, dated as of December 30, 1999, between the Company and American Home Products Corporation.(2) 4.13 Common Stock Purchase Agreement, dated as of February 3, 2000, between the Company and American Home Products Corporation.(2) 4.15 Common Stock Purchase Agreement, dated as of April 5, 2000, between the Company and American Home Products Corporation.(3) 4.16 Registration Rights Agreement, dated October 10, 2000, by and between the Company and Evans Vaccines Limited. 5.1 Opinion of Cooley Godward LLP.(4) 23.1 Consent of Ernst & Young LLP, Independent Auditors. 23.2 Consent of Cooley Godward LLP. Reference is made to Exhibit 5.1. 24.1* Power of Attorney. See signature page.
- ------------------------- (1) Incorporated by reference to the correspondingly numbered exhibit to our Registration Statement on Form S-1, File No. 333-05209, filed June 5, 1996, as amended. (2) Incorporated by reference to the correspondingly numbered exhibit to our Annual Report on Form 10-K for the year ended December 31, 1999, File No. 0-20815, filed March 8, 2000. (3) Incorporated by reference to the correspondingly numbered exhibit to our Quarterly Report on Form 10-Q for the quarter ended March 31, 2000, File No. 0-20815, filed May 15, 2000. (4) This opinion amends and supercedes the opinion previously filed on September 1, 2000. * Previously filed. EX-4.16 2 f65344a1ex4-16.txt EXHIBIT 4.16 1 EXHIBIT 4.16 REGISTRATION RIGHTS AGREEMENT THIS REGISTRATION RIGHTS AGREEMENT is made as of October 10, 2000, by and among AVIRON, a Delaware corporation (the "Company"), and EVANS VACCINES LIMITED ("Evans"). RECITALS A. Concurrent with the date hereof, the Company and Evans entered into an agreement (the "Manufacturing Agreement") relating to the manufacture of the Company's intranasal flu vaccine, FluMist(TM). B. In connection with the Manufacturing Agreement, the Company agreed to issue to Evans a total of six (6) warrants (each, a "Warrant") to purchase an aggregate total of sixty three thousand one hundred sixty two (63,162) shares (ten thousand five hundred twenty seven (10,527) shares per Warrant) of the Company's common stock, par value $0.001 (the "Shares"), pursuant to the terms as set forth in each Warrant. The parties hereto hereby agree as follows: 1. DEMAND REGISTRATION (a) Except as provided in Section 1(d) below, the Company shall, as expeditiously as possible, but in no event later than ninety (90) days of the date hereof, prepare and file a registration statement on Form S-3 with the Securities and Exchange Commission ("SEC") under the Securities Act of 1933, as amended (the "Securities Act"), to register the resale of the Registrable Securities (as defined below) by Evans (the "Registration Statement") and to use its best efforts to cause the Registration Statement to be declared effective as soon as possible. In the event that at any time the filing of such Registration Statement is undertaken or is required to be undertaken the Company fails to qualify for use of Form S-3 (or other available form for similar type securities registration) for purposes of registering for resale the Shares, the Company shall cause a registration statement on Form S-1 (or other available form for similar type securities registration) to be filed as soon as practicable thereunder. Evans agrees to furnish promptly to the Company in writing all information reasonably required by the Company to file such Registration Statement. For purposes of this Agreement, "Registrable Securities" means the Shares issued and/or issuable to Evans upon exercise of the Warrants, or upon any stock split, stock dividend, recapitalization or similar event with respect to such Shares, but only to the extent and so long as Shares constitute "restricted securities" under Rule 144 under the Securities Act. As to any particular Registrable Securities, such securities shall cease to be Registrable Securities on the seventh anniversary of the date hereof. (b) The Company shall pay all Registration Expenses (as defined below) in connection with any registration, qualification or compliance hereunder, and Evans shall pay all Selling Expenses (as defined below). "Registration Expenses" shall mean all expenses, except for Selling Expenses, incurred by the Company in complying with the registration provisions herein described, including, without limitation, all registration, qualification and filing fees, 1. 2 printing expenses, escrow fees, fees and disbursements of counsel and independent public accountants for the Company, blue sky fees, transfer agent fees and expenses and the expense of any special audits incident to or required by any such registration. "Selling Expenses" shall mean selling commissions, underwriting fees and stock transfer taxes applicable to the Registrable Securities. (c) In the case of the registration effected by the Company pursuant to these registration provisions, the Company will use its best efforts to: (i) keep such registration effective with respect to the Registrable Securities until the earliest of (A) the seventh anniversary of the effective date of the registration statement, (B) such date as all of the Registrable Securities have been resold or (C) such time as all of the Registrable Securities held by Evans and registered thereunder can be sold without restriction pursuant to Rule 144 under the Securities Act; (ii) prepare and file with the SEC such amendments and supplements to the Registration Statement and the prospectus used in connection with the Registration Statement as may be necessary to comply with the provisions of the Securities Act with respect to the disposition of all securities covered by the Registration Statement; (iii) furnish such number of prospectuses and other documents incident thereto, including any amendment of or supplement to the prospectus, as Evans from time to time may reasonably request in order to facilitate the public sale or other disposition of all or any of the Registrable Securities held by Evans; (iv) cause all Registrable Securities registered as described herein to be listed on each securities exchange and quoted on each quotation service on which similar securities issued by the Company are then listed or quoted; (v) provide a transfer agent and registrar for all Registrable Securities registered pursuant to the Registration Statement and a CUSIP number for all such Registrable Securities; (vi) otherwise use its best efforts promptly to comply with all applicable rules and regulations of the SEC; and (vii) file the documents required of the Company and otherwise use its best efforts promptly to obtain, if applicable, and maintain requisite blue sky clearance in (A) all jurisdictions in which any of the Registrable Securities are originally sold and (B) all other states specified in writing by Evans, provided as to clause (B), however, that the Company shall not be required to qualify to do business or consent to service of process in any state in which it is not now so qualified or has not so consented. The Company shall use its best efforts to qualify for use of Form S-3 or other similar form then available under the Securities Act to register the resale of the Registrable Securities and to maintain such qualification during the periods described in clause (i) above. (d) The Company may delay the filing of the Registration Statement for up to forty-five (45) days by giving written notice to Evans if the Board of Directors of the Company shall have determined in good faith that the Company may be required to disclose any material corporate development which disclosure may have a material effect on the Company. (e) Following the effectiveness of the Registration Statement, the Company may, at any time, but not more than once in any six-month period, suspend the effectiveness of such registration statement for up to 30 days, as appropriate (a "Suspension Period"), by giving notice to Evans, if the Company shall have determined that the Company may be required to disclose any material corporate development which disclosure may have a material effect on the Company. The Company agrees to use commercially reasonable efforts to minimize the length of any such suspension. The duration of any Suspension Period shall be added to the period of time that the Company agrees to keep the Registration Statement effective. Evans agrees that, 2. 3 upon receipt of any notice from the Company of a Suspension Period, Evans shall forthwith discontinue disposition of shares covered by such Registration Statement or prospectus until Evans (i) is advised in writing by the Company that the use of the applicable prospectus may be resumed, (ii) has received copies of a supplemental or amended prospectus, if applicable, and (iii) has received copies of any additional or supplemental filings which are incorporated or deemed to be incorporated by reference in such prospectus. (f) The Company will, as expeditiously as possible, notify Evans (i) of the effective date of the Registration Statement and the date when any post-effective amendment the Registration Statement becomes effective; (ii) of any stop order or notification from Securities and Exchange Commission or any other jurisdiction as to the suspension of the effectiveness of the Registration Statement; and (iii) of the end of any suspension hereunder. (g) With a view to making available to Evans the benefits of Rule 144 and any other rule or regulation of the SEC that may at any time permit Evans to sell Registrable Securities to the public without registration or pursuant to registration, the Company covenants and agrees to: (i) make and keep public information available, as those terms are understood and defined in Rule 144, until the earlier of (A) the seventh anniversary of the Closing Date or (B) such date as all of the Registrable Securities shall have been resold; (ii) file with the SEC in a timely manner all reports and other documents required of the Company under the Securities Exchange Act of 1934, as amended (the "Exchange Act) and maintain registration of its Common Stock under Section 12 of the Exchange Act; and (iii) furnish to Evans upon request, as long as Evans owns any Registrable Securities, (A) a written statement by the Company that it has complied with the reporting requirements of the Exchange Act, (B) a copy of the most recent annual or quarterly report of the Company, and (C) such other information as may be reasonably requested in order to avail Evans of any rule or regulation of the SEC that permits the selling of any such Registrable Securities without registration (h) The obligation to request the Company to file any Registration Statement shall not be assignable. 2. INDEMNIFICATION AND CONTRIBUTION. (a) The Company agrees to indemnify Evans and hold Evans harmless from and against any losses, claims, damages or liabilities (or actions or proceedings in respect thereof) to which Evans may become subject (under the Securities Act, Exchange Act, state securities laws or otherwise) insofar as such losses, claims, damages or liabilities (or actions proceedings or settlements in respect thereof) arise out of, or are based upon, (i) any untrue statement (or alleged untrue statement) of a material fact contained in the Registration Statement, on the effective date thereof or any preliminary prospectus or final prospectus contained therein, or any amendment or supplement thereto, (ii) the omission or the alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading or (iii) any failure by the Company (or its agents) to fulfill any undertaking included in the Registration Statement, and the Company will, as incurred, reimburse Evans for any legal or other expenses reasonably incurred in investigating, defending or preparing to defend any such action, loss, damage, proceeding or claim; provided, however, that the Company shall not be liable in any such case to the extent that such loss, claim, damage or liability arises out of, or is 3. 4 based upon (i) an untrue statement (or omission) made in such Registration Statement in reliance upon and in conformity with written information furnished to the Company by or on behalf of Evans specifically for use in preparation of the Registration Statement, or (ii) any untrue statement (or omission) in any Prospectus that is corrected in any subsequent Prospectus that was delivered to Evans by the Company prior to the pertinent sale or sales by Evans. The Company will reimburse Evans for any legal or other expenses reasonably incurred in investigating, defending or preparing to defend any such action, proceeding or claim notwithstanding the absence of a judicial determination as to the propriety and enforceability of the obligations under this section and the possibility that such payments might later be held to be improper, provided, that (i) to the extent any such payment is ultimately held to be improper, the persons receiving such payments shall promptly refund them and (ii) such persons shall provide to the Company, upon request, reasonable assurances of their ability to effect any refund, when and if due. (b) Evans agrees to indemnify and hold harmless the Company from and against any losses, claims, damages or liabilities (or actions or proceedings in respect thereof) to which the Company may become subject (under the Securities Act or otherwise) insofar as such losses, claims, damages or liabilities (or actions or proceedings in respect thereof) arise out of, or are based upon (i) an untrue statement made in such Registration Statement in reliance upon and in conformity with written information furnished to the Company by or on behalf of Evans specifically for use in preparation of the Registration Statement, provided, however, that Evans shall not be liable in any such case for any untrue statement included in any Prospectus which statement has been corrected, in writing, by Evans and delivered to the Company before the sale from which such loss occurred, or (ii) any untrue statement in any Prospectus that is corrected in any subsequent Prospectus that was delivered to Evans prior to the pertinent sale or sales by Evans, provided, further, however, that the liability of Evans hereunder shall be limited to the proceeds received by Evans from the sale of the Registrable Securities covered by such Registration Statement; and provided, further, however, that the obligations of Evans hereunder shall not apply to amounts paid in settlement of any such loss, claim, damage, liability, or action settlement is effected without the consent of Evans. Evans will reimburse the Company for any legal or other expenses reasonably incurred in investigating, defending or preparing to defend any such action, proceeding or claim up to the limits set forth herein notwithstanding the absence of a judicial determination as to the propriety and enforceability of the obligations under this section and the possibility that such payments might later be held to be improper, provided, that (i) to the extent any such payment is ultimately held to be improper, the persons receiving such payments shall promptly refund them and (ii) such persons shall provide to Evans, upon request, reasonable assurances of their ability to effect any refund, when and if due. (c) Promptly after receipt by any indemnified person of a notice of a claim or the commencement of any action in respect of which indemnity is to be sought against an indemnifying person pursuant to this Section 2, such indemnified person shall notify the indemnifying person in writing of such claim or of the commencement of such action, and, subject to the provisions hereinafter stated, in case any such action shall be brought against an indemnified person and the indemnifying person shall have been notified thereof, the indemnifying person shall be entitled to participate therein, and, to the extent that it shall wish, to assume and undertake the defense thereof, with counsel reasonably satisfactory to the indemnified person. After notice from the indemnifying person to such indemnified person of 4. 5 the indemnifying person's election to assume and undertake the defense thereof, the indemnifying person shall not be liable to such indemnified person for any legal expenses subsequently incurred by such indemnified person in connection with the defense thereof; provided, however, that if there exists or shall exist a conflict of interest that would make it inappropriate in the reasonable judgment of the indemnified person for the same counsel to represent both the indemnified person and such indemnifying person or any affiliate or associate thereof, the indemnified person shall be entitled to retain its own counsel at the expense of such indemnifying person. (d) If the indemnification provided for in this Section 2 is unavailable to or insufficient to hold harmless an indemnified party under subsection (a) or (b) above in respect of any losses, claims, damages or liabilities (or actions proceedings or settlements in respect thereof) referred to therein, then the indemnifying party shall contribute to the amount paid or payable by such indemnified party as result of such losses, claims, damages or liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect the relative fault of the Company on the one hand and Evans on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other relevant equitable considerations. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company on the one hand or Evans on the other and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company and Evans agree that it would not be just and equitable if contribution pursuant to this subsection (d) were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to above in this subsection (d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages, or liabilities (or actions in respect thereof) referred to above in this subsection (d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this subsection (d), Evans shall not be required to contribute any amount in excess of the amount by which the amount received by Evans (net of Selling Expenses) from the sale of the Registrable Securities to which such loss relates exceeds the amount of any damages which Evans has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. (e) The obligations of the Company and Evans under this Section 2 shall be in addition to any liability which the Company and Evans may otherwise have and shall extend, upon the same terms and conditions, to each person, if any, who controls the Company or Evans within the meaning of the Securities Act. 5. 6 3. MISCELLANEOUS. (a) SUCCESSORS AND ASSIGNS. All covenants and agreements in this Agreement by or on behalf of any of the parties hereto shall bind and inure to the benefit of the respective successors and assigns of the parties hereto whether so expressed or not. (b) SEVERABILITY. Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of this Agreement. (c) COUNTERPARTS. This Agreement may be executed simultaneously in two or more counterparts, any one of which need not contain the signatures of more than one party, but all such counterparts taken together shall constitute one and the same Agreement. (d) DESCRIPTIVE HEADINGS. The descriptive headings of this Agreement are inserted for convenience only and do not constitute a part of this Agreement. (e) GOVERNING LAW. All issues and questions concerning the construction, validity, interpretation and enforcement of this Agreement and the exhibits and schedules hereto shall be governed by, and construed in accordance with, the laws of the State of California, without giving effect to any choice of law or conflict of law rules or provisions (whether of the State of California or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of California. 6. 7 IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date first written above. AVIRON, a Delaware corporation By: /s/ Fred Kurland ------------------------------------- Fred Kurland Senior Vice President and Chief Financial Officer EVANS VACCINES LIMITED By: /c/ C.S.W. Swingland ------------------------------------- C.S.W. Swingland General Counsel 7. EX-5.1 3 f65344a1ex5-1.txt EXHIBIT 5.1 1 [COOLEY GODWARD LLP LETERHEAD] October 24, 2000 Aviron 297 North Bernardo Avenue Mountain View, Ca 94043 RE: AMENDMENT NO. 1 TO REGISTRATION STATEMENT ON FORM S-3 Ladies and Gentlemen: You have requested our opinion with respect to certain matters in connection with the filing by Aviron (the "Company") of Amendment No. 1 to the Registration Statement on Form S-3 (the "Registration Statement") with the Securities and Exchange Commission, including a prospectus (the "Prospectus"), covering the offering of up to (i) 15,316 shares of the Company's Common Stock, $0.001 par value (the "Sinai Shares"), and 26,079 shares of the Company's Common Stock (the "Sinai Warrant Shares") issuable upon the exercise of warrants (the "Sinai Warrants") sold pursuant to the Product Technology Transfer Agreement, dated February 9, 1993, between the Company and Mount Sinai; (ii) 996,840 shares of the Company's Common Stock (together with the Sinai Shares, the "Shares") sold pursuant to various common stock purchase agreements between the Company and American Home Products Corporation; and (iii) 63,162 shares of the Company's Common Stock (together with the Sinai Warrant Shares, the "Warrant Shares") issuable upon the exercise of warrants (together with the Sinai Warrants, the "Warrants") sold pursuant to the Amended and Restated Contract Manufacture Agreement, dated October 11, 2000, between the Company and Evans Vaccines Limited. In connection with this opinion, we have examined and relied upon the Registration Statement and related Prospectus, the Company's Amended and Restated Certificate of Incorporation, the Company's Amended and Restated Bylaws, and the originals or copies certified to our satisfaction of such documents, records, certificates, memoranda and other instruments as in our judgment are necessary or appropriate to enable us to render the opinion expressed below. We have assumed the genuineness and authenticity of all documents submitted to us as copies thereof, and the due execution and delivery of all documents where due execution and delivery are a prerequisite to the effectiveness thereof. On the basis of the foregoing, and in reliance thereon, we are of the opinion that the Shares are, and the Warrant Shares when paid for and issued upon exercise of the Warrants will be, validly issued, fully paid, and nonassessable. 2 Aviron October 24, 2000 Page Two We consent to the reference to our firm under the caption "Legal Matters" in the Prospectus included in the Registration Statement and to the filing of this opinion as an exhibit to the Registration Statement. Very truly yours, /s/ MATTHEW W. SONSINI - -------------------------------- Matthew W. Sonsini EX-23.1 4 f65344a1ex23-1.txt EXHIBIT 23.1 1 EXHIBIT 23.1 CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS We consent to the reference to our firm under the caption "Experts" in Amendment No. 1 to the Registration Statement (Form S-3) and related Prospectus of Aviron for the registration of 1,101,397 shares of its common stock and to the incorporation by reference therein of our report dated February 17, 2000, with respect to the financial statements of Aviron included in its Annual Report (Form 10-K/A) for the year ended December 31, 1999 filed with the Securities and Exchange Commission. /s/ Ernst & Young LLP Palo Alto, California October 20, 2000 -----END PRIVACY-ENHANCED MESSAGE-----