UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): April 15, 2004
ARROWHEAD RESEARCH CORPORATION
------------------------------
(Exact name of registrant as specified in its charter)
Delaware 0-21898 46-0408024
-------- ------- ----------
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
150 S. Los Robles, Ste. 480, Pasadena, CA 91101
----------------------------------------- -----
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (626) 792-5549
Not Applicable
--------------
(Former name or former address, if changed since last report)
ITEM 5. OTHER EVENTS AND REGULATION FD DISCLOSURE.
Nanokinetics, Inc.
- -----------------
On April 21, 2004, Arrowhead Research Corporation, a Delaware corporation
("Arrowhead Research"), entered into an agreement with Dr. Michael Roukes and
the California Institute of Technology ("Caltech"), to form a new corporation,
Nanokinetics, Inc., that will focus on the development of the processes and
devices needed to commercialize various nanotechnology applications. Pursuant
to this agreement, Caltech would grant to Nanokinetics a fully-paid, worldwide,
exclusive license to use for commercial purposes certain technology developed by
Dr. Roukes and his research group at Caltech. As payment in full for the
technology license, Caltech will be granted a warrant to purchase, for a nominal
consideration, shares of the new company's common stock.
Dr. Roukes is a California Institute of Technology physics professor who
has gained worldwide recognition through his work on the physics and fabrication
of nanoscale electronic devices. He is the newly named founding Director of
Caltech's Kavli Nanoscience Institute, which recently received a $7.5 million
grant to foster innovative research at the frontiers of nanoscale science and
engineering.
To date, nanoscience has focused on the development of individual devices
at research universities like Caltech, and elsewhere. Nanokinetics has been
formed to build upon intellectual property developed by Dr. Roukes and his group
that focuses on the incorporation of various nanoscience discoveries to produce
integrated systems of nanotech devices that can provide the basis of products to
be manufactured in commercial quantities. Within a period of approximately
twelve months, Nanokinetics intends to implement this technological base by
establishing the facilities, processes, and techniques required for commercial
production of one or more nanotech products to be developed by Nanokinetics for
target markets. For example, one application under development by Dr Roukes and
his team is a microfluidic-based electronic biosensor based upon BioNEMS
(biofunctionalized nanoelectromechanical systems). In the near term, nanosystems
such as this, with nanoscale sensor elements numbering in the hundreds and
thousands, are expected to provide powerful new approaches to bio-threat
detection, drug screening, and medical diagnostics -- with sensitivity
approaching the single molecule level.
Arrowhead Research has agreed to provide $2,000,000 of initial funding to
the new company to purchase shares of preferred stock, and to contribute up to
$18,000,000 of additional capital as certain milestones in the development of
its business are met. For its investment, Arrowhead Research will own 80% of the
voting securities of the new company, with the balance to be owned by Dr. Roukes
and his mutually acceptable designees, including a chief executive officer to be
subsequently identified. Options will be granted to Dr. Roukes and his designees
that will vest over a 4-year period. Dr. Roukes will also be granted an option
to purchase, at $1.00 per share, 200,000 shares of the Common Stock of Arrowhead
Research.
In the event that all of the outstanding options and warrants fully vested
and were exercised, along with additional options that are available for future
grant under a stock option plan, the ownership of Arrowhead Research in the new
company would be reduced, to approximately 45.5% of the then outstanding voting
securities. However, as owner of all outstanding preferred stock, Arrowhead
Research at all times will have the right to elect a majority of the members of
the new company's Board of Directors, with the remaining directors to be elected
by Dr. Roukes and the other holders of the new company's common stock. The
initial Board of Directors of the new company will be comprised of 3
representatives of Arrowhead Research and two designees of Dr. Roukes and his
group.
-2-
Execution of the agreement to form Nanokinetics, Inc. was publicly
announced by Arrowhead Research on April 22, 2004, by means of a Press Release,
a copy of which is filed as an exhibit hereto.
Insert Therapeutics, Inc.
- -------------------------
On April 15, 2004, Arrowhead Research agreed to acquire a majority position
in Insert Therapeutics, Inc., a Pasadena-based company focused on designing,
developing and commercializing delivery-enhanced therapeutics using its patented
class of polymeric delivery systems.
With research being led by Dr. Mark Davis, a professor of chemical
engineering at the California Institute of Technology, Insert Therapeutics is
currently expanding and leveraging its platform technology, Cyclosert(TM),
through an internal small-molecule drug development program, a gene-therapy
collaboration with San Diego-based Canji, Inc., a subsidiary of Schering-Plough.
The founder of Insert Therapeutics, Dr. Davis is a Member of the National
Academy of Engineering and a recipient of numerous awards including the
prestigious Alan T. Waterman Award, given by the National Science Foundation
annually to only one scientist in the United States across all disciplines. Dr.
Davis was the first engineer to win this award for his work in rationally
designed materials. Dr. Davis earned his B.S., M.S. and Ph.D. degrees in
Chemical Engineering, holds over 30 patents, has published more than 300 papers
and has presented over 450 seminars throughout the world.
Insert has designed a novel class of "intelligent" polymers that
incorporate properties for the intracellular, systemic delivery of a broad range
of therapeutics. The polymer-therapeutic composites form nanoparticles that have
designable size and functions. These "smart" nanoparticles can deliver
therapeutics ranging from small molecules to genes and their combinations.
Unlike passive drug carriers, Cyclosert polymers respond to biological
mechanisms and micro-environmental conditions enabling the active release of
their therapeutic payload into tumor cells or other selected tissues, that can
be targeted with the attachment of various cell surface receptor ligands.
Cyclosert's linear cyclodextrin-containing polymers can be designed to be
neutral, positively charged or negatively charged. This feature is unique to
Cyclosert technology and provides great flexibility for formulation and
delivery. Cyclosert has been synthesized at molecular weights high enough to
provide for to slowed renal clearance, enhanced circulation time and improved
accumulation of active drug at the target tissue. Using Cyclosert, Insert
expects to be able to significantly improve the solubility, stability, toxicity,
efficacy and pharmacokinetic characteristics of anticancer drugs.
-3-
Arrowhead Research has agreed to provide $2,000,000 of initial capital to
Insert Therapeutics, to purchase shares of preferred stock, and to contribute up
to $3,000,000 of additional capital as certain milestones in the further
development of its business are met. For its investment, Arrowhead Research
will acquire approximately 64% of the voting securities of Insert Therapeutics,
with the balance to be owned by management and existing shareholders. The
agreement provides that the Board of Directors of Insert Therapeutics will
consist of three individuals, the current Chief Executive Officer and two
designees of Arrowhead Research. An option pool has been established pursuant
to which options to purchase additional shares of common stock may be granted by
the Board of Directors to employees and officers of, and consultants to, Insert
Therapeutics. In the event that all of these options were granted and exercised,
the ownership of Arrowhead Research in the Inert Therapeutics would be reduced,
but not below 50% of the then outstanding voting securities.
Execution of the agreement to acquire a controlling interest in Insert
Therapeutics, Inc. was publicly announced by Arrowhead Research on April 22,
2004, by means of a Press Release, a copy of which is filed as an amendment
hereto.
Aonexx Technologies, Inc.
- ------------------------
Previously, by a press release dated March 9, 2004, Arrowhead Research
announced an agreement to form its first nanotech subsidiary with Dr. Harry A
Atwater and his research group at the California Institute of Technology. On
April 20, 2004 a second press release was issued to announce the name of the new
corporation, Aonexx Technologies, Inc. ("Aonexx"), and that Sean Olson has been
named as the President of Aonexx. On April 20, 2004, the formation and
organization of Aonexx was completed, with Arrowhead Research making its
contribution of $2,000,000 to the capital of Aonexx in exchange for preferred
stock representing 80% of the voting securities of the company, with a
commitment to inject an additional $3,000,000 if certain milestones are met.
Aonexx was formed to commercialize a patented method for transferring
nano-layers of semiconductor materials (e.g., indium phosphide, germanium, and
gallium arsenide) and oxides (e.g., barium titanate, lithium niobate, and PMNPT)
onto low-cost substrates (e.g., silicon, sapphire, and glass), with no adhesives
and with controlled stress.
Early applications are expected to include the development of inexpensive
laminate wafers (e.g., indium phosphide on silicon and germanium on silicon)
that could replace expensive, homogenous compound semiconductor substrates.
These 'replacement' wafers are expected to reduce manufacturing costs and
improve performance for devices such as LEDs, power amplifiers for wireless
communications, and high-efficiency solar cells. Aonexx is currently scheduled
to have limited samples available for evaluation purposes by qualified customers
within three months.
Aonexx is also exploring the use of the technology to support the
integration of different semiconductor materials onto a single substrate. Such a
technology would enable optical, logical, and high frequency power amplification
devices to be integrated into single dies - an industry trend
-4-
termed 'system on a chip' (SoC) - and bring with it opportunities for
significant cost savings and performance improvements. Ultimately, the company
hopes to enable the optical and electrical properties of device active regions
to be engineered independently of the underlying substrate's thermal,
dielectric, and mechanical properties.
Mr. Olson, age 33, joins Aonexx with four years of technical and business
experience in the semiconductor industry and three years of experience working
with new ventures as a management consultant and venture capitalist. He served
in engineering and management positions at Silicon Valley Group Lithography
(acquired by ASML), and supported technology and business development efforts at
Oraxion Diagnostics, a start-up in the metrology space. He was also a strategy
consultant for The Boston Consulting Group. Mr. Olson received his bachelor's
and master's degrees in engineering from the Massachusetts Institute of
Technology and a master's degree in Business Administration from the Harvard
Business School.
The press release dated March 9, 2004 announcing the agreement to form the
new company now known as Aonexx was previously filed as an exhibit to the
Current Report on Form 10-K filed by Arrowhead Research with the Securities and
Exchange Commission on March 10, 2004. A copy of the press release dated April
20, 2004, regarding the appointment of Mr. Olson as the President of Aonexx is
filed herewith as an exhibit hereto.
-5-
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits.
---------
Exhibit No. Description Page No.
----------- ---------------------------------------------- --------
A - Press Release dated April 22, 2004, regarding 5
Nanokinetics, Inc.
B - Press Release dated April 22, 2004, regarding 6
Insert Therapeutics, Inc.
C - Press Release dated April 20, 2004, regarding 7
the appointment of Sean Olson as the President
of Aonexx Technologies, Inc.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: April 22, 2004
ARROWHEAD RESEARCH CORPORATION
By: /s/ R. Bruce Stewart
---------------------------------
R. Bruce Stewart, President
-6-
[GRAPHIC OMITTED]
Arrowhead Research
Corporation
PRESS RELEASE
Tuesday, April 20, 2004
7:00 am EDT
ARROWHEAD RESEARCH CORPORATION'S
NEW NANOTECH SUBSIDIARY, AONEXX TECHNOLOGIES, INC.,
NAMES PRESIDENT
Pasadena, California - (PR Newswire) - April 20, 2004 - Arrowhead Research
Corporation (OTCBB: ARWR) announced today that its newly-formed nanotech
subsidiary, Aonexx Technologies, Inc., has named Mr. Sean Olson as President.
Aonexx Technologies is developing patented nano-layer transfer technologies and
system integration solutions for the compound semiconductor industry.
"Sean has a wealth of experience, strong leadership skills, and a clear
strategic vision for the Company. He is also deeply knowledgeable on both the
business principles and technologies that drive the semiconductor industry,"
said Harry Atwater, the Caltech Professor who developed the technology and
co-founded the Company with Arrowhead Research. "We are very pleased to have
him on the team."
Mr. Olson joins Aonexx with technical and business experience in the
semiconductor industry. He served in engineering and management positions at
Silicon Valley Group Lithography (acquired by ASML), and supported technology
and business development efforts at Oraxion Diagnostics, a start-up in the
metrology space. He was also a strategy consultant for The Boston Consulting
Group. Mr. Olson received his bachelor's and master's degrees in engineering
from the Massachusetts Institute of Technology and a master's degree in Business
Administration from the Harvard Business School.
Aonexx Technologies was formed to commercialize a patented method for
transferring nano-layers of semiconductor materials (e.g., indium phosphide,
germanium, and gallium arsenide) and oxides (e.g., barium titanate, lithium
niobate, and PMNPT) onto low-cost substrates (e.g., silicon, sapphire, and
glass), with no adhesives and with controlled stress.
Early applications are expected to include the development of inexpensive
laminate wafers (e.g., indium phosphide on silicon and germanium on silicon)
that could replace expensive, homogenous compound semiconductor substrates.
These 'replacement' wafers are expected to reduce manufacturing costs and
improve performance for devices such as LEDs, power amplifiers for wireless
communications, and high-efficiency solar cells. Aonexx is currently scheduled
to have limited samples available for evaluation purposes by qualified customers
within three months.
The Company is also exploring the use of the technology to support the
integration of different semiconductor materials onto a single substrate. Such
a technology would enable optical, logical, and high frequency power
amplification devices to be integrated into single dies - an industry trend
termed 'system on a chip' (SoC) - and bring with it opportunities for
significant cost savings and performance improvements. Ultimately, the company
hopes to enable the optical and electrical properties of device active regions
to be engineered independently of the underlying substrate's thermal,
dielectric, and mechanical properties.
ABOUT ARROWHEAD RESEARCH CORPORATION
Arrowhead Research Corporation funds research at universities in pioneering
scientific areas, primarily nanotechnology, in return for exclusive rights to
commercialize technologies and associated intellectual property and patents
developed as a result of this research. The Company has already entered into
agreements with the California Institute of Technology and three of its faculty,
and is actively pursuing other potential partners at Caltech and other leading
research institutions and universities.
Commercial applications that arise from Company-sponsored research projects will
be developed and marketed by Arrowhead Research through a series of diversified
subsidiaries representing each product or application, or through third-party
licensing. The first majority-owned subsidiary, Aonexx Technologies, was formed
to commercialize an ultrathin crystal film (nanofilm) technology that was
developed at Caltech.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995:
This news release contains forward-looking statements within the meaning of the
"safe harbor" provisions of the Private Securities Litigation Reform Act of
1995. These statements are based upon our current expectations and speak only as
of the date hereof. Our actual results may differ materially and adversely from
those expressed in any forward-looking statements as a result of various factors
and uncertainties, including the recent economic slowdown affecting technology
companies, our ability to successfully develop products, rapid technological
change in our markets, changes in demand for our future products, legislative,
regulatory and competitive developments and general economic conditions. Our
Annual Report on Form 10-K, recent and forthcoming Quarterly Reports on Form
10-Q, recent Current Reports on Forms 8-K and 8-K/A, and other SEC filings
discuss some of the important risk factors that may affect our business, results
of operations and financial condition. We undertake no obligation to revise or
update publicly any forward-looking statements for any reason.
CONTACT
R. Bruce Stewart, President
Telephone: 626.792.5549
Email: bruce@arrowres.com
------------------
[GRAPHIC OMITTED]
Arrowhead Research
Corporation
PRESS RELEASE
Thursday, April 22, 2004
7:00 am EDT
MAJORITY INVESTMENT MADE IN NEW NANOTECH SUBSIDIARY BY ARROWHEAD RESEARCH
CORPORATION
INSERT THERAPEUTICS, INC. TO FURTHER THE DEVELOPMENT AND COMMERCIALIZATION OF
SMALL MOLECULE, DRUG DELIVERY SYSTEMS
Pasadena, California - (PR Newswire) - April 22, 2004 - Arrowhead Research
Corporation (OTCBB: ARWR), an emerging company in the field of nanotechnology,
announced today that it has agreed to take a majority position in Insert
Therapeutics, Inc., a Pasadena-based company focused on designing, developing
and commercializing delivery-enhanced therapeutics using its patented class of
polymers.
With research being led by Dr. Mark Davis, a professor of chemical engineering
at the California Institute of Technology, Insert Therapeutics is currently
expanding and leveraging its platform technology, Cyclosert(TM), through an
internal small-molecule drug development program, a gene-therapy collaboration
with San Diego-based Canji, Inc., a subsidiary of Schering-Plough.
The founder of Insert Therapeutics, Dr. Davis is a Member of the National
Academy of Engineering and a recipient of numerous awards including the
prestigious Alan T. Waterman Award, given by the National Science Foundation
annually to only one scientist in the United States across all disciplines. Dr.
Davis was the first engineer to win this award for his work in rationally
designed materials. Dr. Davis earned his B.S., M.S. and Ph.D. degrees in
Chemical Engineering, holds over 30 patents, has published more than 300 papers
and has presented over 450 seminars throughout the world.
Insert has designed a novel class of "intelligent" polymers that incorporate
properties for the intracellular, systemic delivery of a broad range of
therapeutics. The polymer-therapeutic composites form nanoparticles that have
designable size and functions. These "smart" nanoparticles can deliver
therapeutics ranging from small molecules to genes and their combinations.
Unlike passive drug carriers, Cyclosert polymers respond to biological
mechanisms and micro-environmental conditions enabling the active release of
their therapeutic payload into tumor cells or other selected tissues, that can
be targeted with the attachment of various cell surface receptor ligands.
Cyclosert's linear cyclodextrin-containing polymers can be designed to be
neutral, positively charged or negatively charged. This feature is unique to
Cyclosert technology and provides great flexibility for formulation and
delivery. Cyclosert has been synthesized at molecular weights high enough to
provide for to slowed renal clearance, enhanced circulation time and improved
accumulation of active drug at the target tissue. Using Cyclosert, Insert has
significantly improved the solubility, stability, toxicity, efficacy and
pharmacokinetic characteristics of anticancer drugs.
ABOUT ARROWHEAD RESEARCH CORPORATION
Arrowhead Research Corporation funds research at universities in pioneering
scientific areas, primarily nanotechnology, in return for exclusive rights to
commercialize technologies and associated intellectual property and patents
developed as a result of this research. The Company has already entered into
agreements with the California Institute of Technology and three of its faculty,
and is actively pursuing other potential partners at Caltech and other leading
research institutions and universities.
Commercial applications that arise from Company-sponsored research projects will
be developed and marketed by Arrowhead Research through a series of diversified
subsidiaries representing each product or application, or through third-party
licensing. The first majority-owned subsidiary, Aonexx Technologies, was formed
to commercialize an ultrathin crystal film (nanofilm) technology that was
developed at Caltech.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995:
This news release contains forward-looking statements within the meaning of the
"safe harbor" provisions of the Private Securities Litigation Reform Act of
1995. These statements are based upon our current expectations and speak only as
of the date hereof. Our actual results may differ materially and adversely from
those expressed in any forward-looking statements as a result of various factors
and uncertainties, including the recent economic slowdown affecting technology
companies, our ability to successfully develop products, rapid technological
change in our markets, changes in demand for our future products, legislative,
regulatory and competitive developments and general economic conditions. Our
Annual Report on Form 10-K, recent and forthcoming Quarterly Reports on Form
10-Q, recent Current Reports on Forms 8-K and 8-K/A, and other SEC filings
discuss some of the important risk factors that may affect our business, results
of operations and financial condition. We undertake no obligation to revise or
update publicly any forward-looking statements for any reason.
CONTACT
R. Bruce Stewart, President
Telephone: 626.792.5549
Email: bruce@arrowres.com
------------------
[GRAPHIC OMITTED]
Arrowhead Research
Corporation
PRESS RELEASE
Thursday, April 22, 2004
7:01 am EDT
CALTECH PROFESSOR MICHAEL ROUKES, CALTECH, AND ARROWHEAD RESEARCH AGREE TO FORM
NANOKINETICS
NEW SUBSIDIARY TO STRATEGICALLY FOCUS ON
COMMERCIAL APPLICATIONS IN NANOTECH FIELD
Pasadena, California - (PR Newswire) - April 22, 2004 - Arrowhead Research
Corporation (OTCBB: ARWR), an emerging company in the field of nanotechnology,
announced today that it has reached an agreement with Dr. Michael Roukes,
California Institute of Technology Professor of Physics, Applied Physics and
Bioengineering, and Caltech itself, to form a new corporation, Nanokinetics,
that will focus on the development of the processes and devices needed to
commercialize various nanotechnology applications. Nanokinetics will be the
third majority-owned subsidiary formed by Arrowhead Research.
Dr. Roukes has gained worldwide recognition through his work on the physics and
fabrication of nanoscale electronic devices. He is the newly named founding
Director of Caltech's Kavli Nanoscience Institute, which recently received a
$7.5 million grant to foster innovative research at the frontiers of nanoscale
science and engineering.
Nanokinetics plans to focus upon building the technological base required to
transition today's academic "nanoscience of the individual device" to the
integration and mass production required for these market-ready products. With
this process-oriented focus, Nanokinetics hopes to jumpstart the
commercialization of many of the nanotech applications already available. Dr.
Roukes stated, "It is becoming clearer every day that the companies that make
early and decisive investments to establish capabilities for complex nanodevice
production will dominate the broader realm of commercial nanotechnology that lie
beyond first-generation applications."
One application being developed by Dr. Roukes and his team is a
microfluidic-based electronic biosensor based upon BioNEMS (biofunctionalized
nanoelectromechanical systems). In the near term, nanosystems such as these,
with nanoscale sensor elements numbering in the hundreds and thousands, can
provide powerful new approaches to bio-threat detection, drug screening, and
medical diagnostics - with sensitivity approaching the single molecule level.
Commenting on this latest addition, R. Bruce Stewart, President of Arrowhead
Research, said, "We are obviously very pleased to add the world-class scientist
Michael Roukes to our team. In addition to bringing a wide array of experience
and knowledge to the Arrowhead Research umbrella, we believe that the formation
of Nanokinetics with Dr. Roukes will significantly increase the probability of
more rapid commercialization of nanotech products and applications, including
those in which our sponsored researchers and other subsidiaries are involved."
ABOUT ARROWHEAD RESEARCH CORPORATION
Arrowhead Research Corporation funds research at universities in pioneering
scientific areas, primarily nanotechnology, in return for exclusive rights to
commercialize technologies and associated intellectual property and patents
developed as a result of this research. The Company has already entered into
agreements with the California Institute of Technology and three of its faculty,
and is actively pursuing other potential partners at Caltech and other leading
research institutions and universities.
Commercial applications that arise from Company-sponsored research projects will
be developed and marketed by Arrowhead Research through a series of diversified
subsidiaries representing each product or application, or through third-party
licensing. The Company's majority-owned subsidiaries are Aonexx Technologies,
Inc. was formed to commercialize an ultrathin crystal film (nanofilm) technology
and Insert Therapeutics, Inc. which is developing a proprietary drug delivery
system.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995:
This news release contains forward-looking statements within the meaning of the
"safe harbor" provisions of the Private Securities Litigation Reform Act of
1995. These statements are based upon our current expectations and speak only as
of the date hereof. Our actual results may differ materially and adversely from
those expressed in any forward-looking statements as a result of various factors
and uncertainties, including the recent economic slowdown affecting technology
companies, our ability to successfully develop products, rapid technological
change in our markets, changes in demand for our future products, legislative,
regulatory and competitive developments and general economic conditions. Our
Annual Report on Form 10-K, recent and forthcoming Quarterly Reports on Form
10-Q, recent Current Reports on Forms 8-K and 8-K/A, and other SEC filings
discuss some of the important risk factors that may affect our business, results
of operations and financial condition. We undertake no obligation to revise or
update publicly any forward-looking statements for any reason.
CONTACT
R. Bruce Stewart, President
Telephone: 626.792.5549
Email: bruce@arrowres.com
------------------