SPECTRUM PHARMACEUTICALS INC FORM 10-K (Annual Report) Filed 03/12/14 for the Period Ending 12/31/13 Address 11500 S. EASTERN AVE., SUITE 240 HENDERSON, NV 89052 Telephone 702-835-6300 CIK 0000831547 Symbol SPPI SIC Code 2834 - Pharmaceutical Preparations Industry Biotechnology & Drugs Sector Healthcare Fiscal Year 12/31 http://www.edgar-online.com © Copyright 2014, EDGAR Online, Inc. All Rights Reserved. Distribution and use of this document restricted under EDGAR Online, Inc. Terms of Use. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-K ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2013 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 001-35006 SPECTRUM PHARMACEUTICALS, INC. (Exact Name of Registrant as Specified in its Charter) Delaware 93 -0979187 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 11500 South Eastern Avenue, Suite 240 Henderson, Nevada 89052 (Address of principal executive offices) (702) 835-6300 (Registrant’s telephone number, including area code) Securities registered pursuant to Section 12(b) of the Act: Title of Each Class Name of Each Exchange on Which Registered Common Stock, $0.001 par value The NASDAQ Stock Market, LLC Rights to Purchase Series B Junior Participating Preferred Stock Securities registered pursuant to Section 12(g) of the Act: None Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes No Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes No Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer Accelerated filer Non -accelerated filer (Do not check if a smaller reporting company) Smaller reporting company Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No As of June 30, 2013, the aggregate market value of the voting and non-voting common equity held by non-affiliates of the Registrant was $449,722,900 (based upon the $7.46 closing sale price for shares of the Registrant’s Common Stock as reported by the NASDAQ Global Select Market on June 28, 2013, the last trading date of the Registrant’s most recently completed second fiscal quarter). As of February 28, 2014, approximately 65,287,782 shares of the Registrant’s Common Stock, $0.001 par value, were outstanding. DOCUMENTS INCORPORATED BY REFERENCE Portions of the registrant’s Proxy Statement for the registrant’s 2014 Annual Meeting of Shareholders, to be filed on or before April 30, 2014, are incorporated by reference into Part III, Items 10-14 of this Annual Report on Form 10-K. TABLE OF CONTENTS Page PART I Item 1. Business 3 Item 1A. Risk Factors 20 Item 1B. Unresolved Staff Comments 41 Item 2. Properties 41 Item 3. Legal Proceedings 41 Item 4. Mine Safety Disclosures 43 PART II Item 5. Market for Registrant ’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 43 Item 6. Selected Financial Data 45 Item 7. Management ’s Discussion and Analysis of Financial Condition and Results of Operations 47 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 59 Item 8. Financial Statements and Supplementary Data F-1 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 61 Item 9A. Controls and Procedures 61 Item 9B. Other Information 62 PART III Item 10. Directors, Executive Officers and Corporate Governance 62 Item 11. Executive Compensation 62 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 62 Item 13. Certain Relationships and Related Transactions, and Director Independence 63 Item 14. Principal Accountant Fees and Services 63 PART IV Item 15. Exhibits and Financial Statement Schedules 63 Signatures 60 1 Cautionary Note Concerning Forward-Looking Statements This Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934 as amended (the “Exchange Act”). These forward looking statements are intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995 and speak only as of the time this Annual Report on Form 10-K was filed with the Securities and Exchange Commission, or SEC. You can identify forward-looking statements by the use of forward-looking terminology such as, “believes,” “expects,” “may,” “will,” “intends,” “plans,” “should,” “could,” “seeks,” “pro forma,” “anticipates,” “estimates,” “continues,” or other variations thereof, including their use in the negative, or by discussions of strategies, opportunities, plans or intentions. In addition, any statements that refer to projections of our future financial performance, trends in our businesses, or other characterizations of future events or circumstances are forward-looking statements. We have based these forward-looking statements largely on our current expectations based on information currently available to us and projections about future events and trends affecting the financial condition of our business. These Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. Spectrum Pharmaceuticals, Inc.’s actual results may differ materially from the results projected in the forward-looking statements. Factors that might cause such a difference include, but are not limited to: • our ability to successfully develop, obtain regulatory approval for and market our products; • our ability to continue to grow sales revenue of our marketed products; • risks associated with doing business internationally; • our ability to generate and maintain sufficient cash resources to fund our business; • our ability to enter into strategic alliances with partners for manufacturing, development and commercialization; • efforts of our development partners; • the ability of our manufacturing partners to meet our timelines; • the ability to timely deliver product supplies to our customers; • our ability to identify new product candidates and to successfully integrate those product candidates into our operations; • the timing and/or results of pending or future clinical trials, and our reliance on contract research organizations; • our ability to protect our intellectual property rights; • competition in the marketplace for our drugs; • delay in approval of our products or new indications for our products by the U.S. Food and Drug Administration, or the FDA; • actions by the FDA and other regulatory agencies, including international agencies; • securing positive reimbursement for our products; • the impact of any product liability, or other litigation to which we are, or may become a party; • the impact of legislative or regulatory reform of the healthcare industry and the impact of recently enacted healthcare reform legislation; • the availability and price of acceptable raw materials and components from third-party suppliers, and their ability to meet our demands; • our ability, and that of our suppliers, development partners, and manufacturing partners, to comply with laws, regulations and standards, and the application and interpretation of those laws, regulations and standards, that govern or affect the pharmaceutical and biotechnology industries, the non-compliance with which may delay or prevent the development, manufacturing, regulatory approvals and sale of our products; • defending against claims relating to improper handling, storage or disposal of hazardous chemical, radioactive or biological materials which could be time consuming and expensive; 2 • our ability to maintain the services of our key executives and technical and sales and marketing personnel; • the difficulty in predicting the timing or outcome of product development efforts and regulatory approvals; and • demand and market acceptance for our approved products. In addition, past financial or operating performance is not necessarily a reliable indicator of future performance, and you should not use our historical performance to anticipate results or future period trends. We can give no assurances that any of the events anticipated by the forward- looking statements will occur or, if any of them do, what impact they will have on our results of operations and financial condition. Except as required by law, we do not undertake to update any such forward-looking statements and expressly disclaim any duty to update the information contained in this Annual Report on Form 10-K.