International Offering Memorandum
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INTERNATIONAL OFFERING MEMORANDUM International offering of up to 6,373,493 shares Offering Price: Expected to be in a range between €4.15 and €4.80 per share, nominal value €0.05 per share This is an initial public offering of up to 6,373,493 ordinary shares of Innate Pharma S.A., a French société anonyme. This international offering of shares to institutional investors is part of a single global offering of up to 6,373,493 Innate Pharma shares. The global offering also includes a public offering in France. The final allocation of shares between this international offering and the French public offering will be determined at the time the results of the French public offering are known. This offering memorandum relates only to the international offering. Concurrently with this offering, we are carrying out a capital increase reserved for Novo Nordisk A/S by issuing up to 1,204,819 of our new shares at the same offering price. We have also granted Bryan, Garnier & Co. Limited and Société Générale, the Joint Lead Managers and Joint Bookrunners, a 30-day over-allotment option to subscribe for up to 831,325 new shares of Innate Pharma, for the purpose of covering over-allotments, if any. Prior to this offering, there has been no public market for our shares. We will apply to list our shares on the Eurolist by Euronext™ of Euronext Paris S.A. (“Eurolist”). We expect our shares to be listed and quoted on the Eurolist on or about 31 October 2006 under the symbol “IPH.” Investing in our shares involves certain risks. See “Risk Factors” beginning on page 14 and on page 95. You should consider these factors before subscribing the new shares. Our shares have not been and will not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”) or under any securities laws of any state of the United States of America. Our shares are only being offered in transactions that are exempt from the registration requirements of the Securities Act in reliance on Regulation S under the Securities Act outside the United States and under other applicable exemptions. See “Transfer and Selling Restrictions” for additional information about eligible offerees and transfer restrictions. The information in this offering memorandum is preliminary and will be supplemented by a pricing supplement which will contain additional information about this global offering, including, among other matters, the final price per share offered hereby and the number of shares to be sold in the French and international tranches of the offering. The shares are expected to be delivered against payment in euro to purchasers on or about 3 November 2006. Joint Lead Managers and Joint Bookrunners This international offering memorandum is dated 18 October 2006 1 TABLE OF CONTENTS NOTICE TO INVESTORS............................................................................................................................ i TRANSFER AND SELLING RESTRICTIONS ......................................................................................... ii FORWARD-LOOKING INFORMATION.................................................................................................. iv SUMMARY .................................................................................................................................................... 1 INFORMATION ABOUT THE OFFERING .............................................................................................. 13 1. NOT APPLICABLE ........................................................................................................... 14 2. RISK FACTORS RELATED TO THE OFFERING ...................................................... 14 3. BASIC INFORMATION.................................................................................................... 15 4. INFORMATION ON SECURITIES TO BE OFFERED AND LISTED FOR TRADING .............................................................................................................................................. 17 5. OFFERING PROCEDURES ............................................................................................. 30 6. ADMISSION TO TRADING AND TRADING METHODS .......................................... 44 7. SALES BY SECURITIES HOLDERS AND RETENTION COMMITMENTS........... 47 8. ISSUE-RELATED EXPENSES......................................................................................... 49 9. DILUTION .......................................................................................................................... 49 10. ADDITIONAL INFORMATION...................................................................................... 51 RECENT INFORMATION ABOUT THE COMPANY............................................................................. 52 11. UPDATE OF INFORMATION ON OUR COMPANY................................................... 53 11.1Changes in our Products .................................................................................................... 53 11.2Interim Financial Statements Prepared under Accounting Principles Generally Accepted in France and IFRS Rules as of 30 June 2006....................................................................... 55 11.3A Review of Our Company’s Financial Position and Results of Operations as of 30 June 2006 ...................................................................................................................................... 79 11.4Classes of Shares - Conversion of Classes C and D Preferred Shares to Ordinary Shares .............................................................................................................................................. 89 11.5Acquisition by Our Company of its own Shares .............................................................. 89 11.6 Exercise of Warrants (BSA)............................................................................................... 89 11.7Delegated Powers Granted by the General Meeting of Shareholders to the Executive Board .............................................................................................................................................. 90 INFORMATION ABOUT THE COMPANY .............................................................................................. 91 CHAPTER 1. NOT APPLICABLE ........................................................................................................... 93 CHAPTER 2. AUDITORS ......................................................................................................................... 93 2.1 Statutory Auditors .............................................................................................................. 93 2.2 Substitute Auditors ............................................................................................................. 93 CHAPTER 3. SELECTED FINANCIAL AND OPERATING INFORMATION................................. 94 CHAPTER 4. RISK FACTORS................................................................................................................. 95 4.1 Risks Related to our Company .......................................................................................... 95 4.2 Financial Risks .................................................................................................................... 101 4.3 Legal Risks........................................................................................................................... 103 4.4 Industrial Risks Related to the Environment................................................................... 106 4.5 Insurance and Risk Coverage ............................................................................................ 107 4.6 Market Risks ....................................................................................................................... 108 CHAPTER 5. INFORMATION ABOUT OUR COMPANY .................................................................. 109 5.1 History and Development of our Company ...................................................................... 109 5.2 Investments.......................................................................................................................... 111 CHAPTER 6. BUSINESS OVERVIEW.................................................................................................... 112 6.1 Introduction......................................................................................................................... 112 6.2 Strategy and Strengths ....................................................................................................... 113 6.3 Presentation of our Company ............................................................................................ 115 6.4 Industrial and Scientific Context....................................................................................... 122 6.5 Our Therapeutic Approach................................................................................................ 124 6.6 Regulatory Environment.................................................................................................... 150 6.7 Dependency Factors............................................................................................................ 153 6.8 Competitive Position........................................................................................................... 153 CHAPTER 7. ORGANISATIONAL CHART.........................................................................................