Aphton Corporation - 10-Q/A 9/30/03

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.

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

Amendment No. 1 to Form 10-Q amends and restates certain items of the Quarterly Report of Aphton Corporation (the “Company”) on Form 10-Q as previously filed for the three and nine months ended September 30, 2003. The restatement of certain items of the Company’s previously filed Form 10-Q for the three and nine months ended September 30, 2003 and 2002 is being made in order to (i) correct an application of certain accounting rules relating to our $20 million convertible notes financing in the 2nd quarter of 2003; and (ii) revise related disclosures. Changes related to these items have been made in the following items of the Form 10-Q:


			Page

Part I - Financial Information
	Item 1. Financial Statements:			3
		Balance Sheets – September 30, 2003 (unaudited) and December 31, 2002		4
		Statements of Operations (unaudited) – Three and nine months ended September 30, 2003 and 2002		5
		Statements of Cash Flows (unaudited) – Nine months ended September 30, 2003 and 2002		6
	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			9
Signatures				14

The interim financial statements included herein have been prepared by us, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. In the opinion of management, the financial statements include all adjustments (consisting of normal recurring entries) necessary to present fairly our financial position as of September 30, 2003 and December 31, 2002 and the results of our operations for the three and nine months ended September 30, 2003 and 2002; and our cash flows for the nine months ended September 30, 2003 and 2002. It is suggested that these financial statements be read in conjunction with the financial statements and the notes thereto included in our latest annual report on Form 10-K.


				September 30, 2003			December 31, 2002

				(unaudited)
				Restated
	Assets
Current Assets:
Cash and current investments:
		Cash and short-term cash investments		$	25,064,788		$	7,824,182
		Investment securities-trading			714,387			749,095

			Total cash and current investments		25,779,175			8,573,277
Other assets (including current portion of unconditional supply commitment)					328,965			374,740

			Total current assets		26,108,140			8,948,017
Equipment and improvements, at cost, net of accumulated depreciation and amortization					180,885			245,063
Unconditional supply commitment					6,797,900			6,797,900

			Total assets	$	33,086,925		$	15,990,980

	Liabilities and Stockholders’ Equity (Deficit)
Liabilities:
Current liabilities:
		Trade accounts payable		$	3,659,896		$	10,130,944
		Amounts payable to Aventis			3,232,000			3,184,000
		Other			977,843			1,001,672
		Interest payable			547,500			—

			Total current liabilities		8,417,239			14,316,616
		Convertible debentures, net of discount of $12,499,508 as of September 30, 2003			10,500,492			3,000,000
		Deferred revenue			10,000,000			10,000,000

			Total liabilities		28,917,731			27,316,616

Commitments
Stockholders’ Equity (Deficit):
		Preferred stock, $0.001 par value - Authorized: 4,000,000 shares - Issued and outstanding: none			—			—
		Common stock, $0.001 par value - Authorized: 60,000,000 shares Issued and outstanding: 28,621,639 shares at September 30, 2003 and 24,201,639 shares at December 31, 2002			28,622			24,202
		Additional paid in capital			164,174,877			128,956,652
		Purchase warrants			317,650			298,900
		Accumulated deficit			(160,351,955	)		(140,605,390	)

			Total stockholders’ equity (deficit)		4,169,194			(11,325,636	)

			Total liabilities and stockholders’ equity (deficit)	$	33,086,925		$	15,990,980

APHTON CORPORATION
Statements of Operations (Unaudited)
For the three and nine months ended September 30, 2003 and 2002


			Three months ended						Nine months ended
			September 30,						September 30,

			2003			2002			2003			2002

			Restated						Restated
Revenue:			$	—		$	—		$	—		$	—

Costs and expenses:
	General and administrative			709,487			657,405			1,988,456			1,611,332
	Research and development			5,537,669			10,180,407			16,542,202			29,182,312

		Total costs and expenses		6,247,156			10,837,812			18,530,658			30,793,644

		Loss from operations		(6,247,156	)		(10,837,812	)		(18,530,658	)		(30,793,644	)

Other income (expense):
	Dividend and interest income			12,602			29,011			43,087			100,624
	Interest expense including amortized discount			(786,500	)		—			(1,306,500	)		—
	Unrealized gains (losses) from investments			15,576			(115,043	)		47,506			(152,558	)

		Net loss	$	(7,005,478	)	$	(10,923,844	)	$	(19,746,565	)	$	(30,845,578	)

Per share data:
	Basic and fully diluted loss per common share		$	(0.28	)	$	(0.52	)	$	(0.80	)	$	(1.55	)

	Weighted average number of common shares outstanding			25,255,552			20,961,639			24,831,529			19,934,496

APHTON CORPORATION
Statements of Cash Flows (Unaudited)
For the nine months ended September 30, 2003 and 2002


					2003			2002

					Restated
Cash flows from operating activities:
		Cash paid to suppliers and employees			$	(24,986,272	)	$	(28,928,147	)

			Net cash used in operating activities			(24,986,272	)		(28,928,147	)
Cash flows from investing activities:
		Proceeds from maturity of held to maturity securities				—			1,999,024
		Capital expenditures				(6,049	)		(62,262	)

			Net cash (used in) provided by investing activities			(6,049	)		1,936,762

Cash flows from financing activities:
		Proceeds from sale of common stock and warrants				22,297,927			32,066,754
		Proceeds from convertible debentures				19,935,000			—

			Net cash received from financing activities			42,232,927			32,066,754

				Net increase in cash and short-term cash investments		17,240,606			5,075,369
Cash and short-term cash investments:
			Beginning of period			7,824,182			3,176,717

			End of period		$	25,064,788		$	8,252,086

		Reconciliation of net loss to net cash used in operating activities
Net loss					$	(19,746,565	)	$	(30,845,578	)
Adjustments to reconcile net loss to net cash used in operating activities:
	Depreciation and amortization					70,227			58,707
	Amortization of discount on convertible debentures					508,960			—
	Unrealized gain on investments					(47,506	)		152,558
	Non-cash employee compensation credit					47,506			(152,558	)
			Changes in -
				Investment securities- trading		34,708			454,931
				Other assets		45,775			185,661
				Unconditional supply commitment		—			270,000
				Current liabilities		(5,899,377	)		948,132

Net cash used in operating activities:					$	(24,986,272	)	$	(28,928,147	)

The Company has restated its Consolidated Financial Statements for the three- and nine-month periods ended September 30, 2003 to reflect a recalculation of the value of the beneficial conversion feature (BCF) attributable to the Company’s issuance of $20.0 million convertible debentures. The Company previously recorded a discount to the convertible notes, and a corresponding entry to additional paid in capital, in accordance with the Emerging Issues Task Force (EITF) No. 98-5, “Accounting for Convertible Securities with Beneficial Conversion Features or Contingently Adjustable Conversion Ratios.” The beneficial conversion feature represents the non-detachable conversion feature that is in-the-money at the commitment date and is valued by allocating a portion of the proceeds from the issuance of the convertible debentures equal to the intrinsic value of that feature to additional paid-in-capital. Pursuant to the original calculation, the Company had previously recorded a discount of $18.1 million, as of June 30, 2003, with respect to the two tranches of the convertible debentures. However, it has recently come to the Company’s attention that the amount of the discount assigned to the BCF should have been limited to the amount of the proceeds allocated to the convertible instrument. As a result, the Company is restating the discount associated with the convertible debentures by $4.7 million to reduce the amount recorded as of September 30, 2003. Consequently, as of September 30, 2003, there is an adjustment to reduce the unamortized discount, which is an offset to the recorded amount of the convertible debentures, with a corresponding decrease in “Additional Paid in Capital” of $5.7 million, a decrease in “Accumulated Deficit” of $1.0 million and a reduction in “Total Stockholders’ Equity” of $4.7 million. Further, the correction of this error resulted in a restatement of the Company’s interest expense and net loss for the three- and nine-month period ended September 30, 2003 to reduce the amounts previously reported by $0.6 million and $1.0 million.

The net loss for the three and nine months ended September 30, 2003 and 2002 was the comprehensive loss for those periods.

At September 30, 2003, shares of our common stock issuable upon the exercise of approximately 6.1 million warrants and options were excluded from the computation of net loss per share because their effect was anti-dilutive. At September 30, 2002, shares of our common stock issuable upon the exercise of approximately 3.7 million warrants and options were excluded from the computation of net loss per share because their effect was anti-dilutive.

On December 31, 2002, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards (“SFAS”) No. 148, Accounting for Stock-Based Compensation — Transition and Disclosure. This Statement amends SFAS No. 123, Accounting for Stock-Based Compensation, to provide alternative methods of transition for an entity that voluntarily changes to the fair value based method of accounting for stock-based employee compensation. It also amends the disclosure provisions of that Statement to require prominent disclosure about the effects on reported net income of an entity’s accounting policy decisions with respect to stock-based employee compensation. Finally, this Statement amends APB Opinion No. 28, Interim Financial Reporting, to require disclosure about those effects in interim financial information. We intend to continue to account for stock-based compensation based on the provisions of APB Opinion No. 25.

The following table summarizes our results as if we had recorded stock-based compensation expense for the nine months ended September 30, 2003 and 2002, based on the provisions of SFAS 123, as amended by SFAS 148:


Net loss:	September 30, 2003			September 30, 2002

	Restated

As reported	$	(19,746,565	)	$	(30,845,578	)
Compensation expense, net of tax		(429,378	)		(212,346	)

Pro forma	$	(20,175,943	)	$	(31,057,924	)

Basic loss per share:
As reported	$	(0.80	)	$	(1.55	)
Compensation expense, net of tax		(0.02	)		(0.01	)

Pro forma	$	(0.82	)	$	(1.56	)

Diluted loss per share:
As reported	$	(0.80	)	$	(1.55	)
Compensation expense, net of tax		(0.02	)		(0.01	)

Pro forma	$	(0.82	)	$	(1.56	)

On September 18, 2003, we sold units consisting of an aggregate of 3,920,000 shares of common stock and five-year warrants to purchase an aggregate of 980,000 shares of common stock to a group of accredited institutional investors for gross proceeds of $22.7 million. The units were sold to accredited investors in reliance upon Section 4(2) of the Securities Act and/or Rule 506 promulgated thereunder. The warrants are exercisable at any time on or after December 18, 2003 until September 18, 2008 at a price of $8.12 per share. The warrants are initially exercisable into 980,000 shares of our common stock. Each warrant includes customary anti-dilution provisions, without any price-based anti-dilution protection, and provides for cashless exercise in certain circumstances.

As of September 30, 2003 we have outstanding $23.0 million in convertible debentures, up from $3.0 million as of December 31, 2002. There was an initial discount calculated against the value of the notes of $12.9 million, comprised of the beneficial conversion feature of $8.3 million and other discounts of $4.6 million on the notes. The unamortized discount as of September 30, 2003 is $12.5 million, which is offset against the $23.0 million and is shown as $10.5 million of convertible debentures in the accompanying financial statements. Of this amount, $3.0 million is our Series A Convertible Debenture. Our Series A Convertible Debenture is a convertible, redeemable, five-year note that matures on December 19, 2007. The Series A Convertible Debenture bears interest at a rate of 11.0% per annum, payable annually. The debenture is convertible at the holder’s option at a conversion price equal to the average closing price of our common stock, as defined in the debenture, at the time of conversion. The Series A Convertible Debenture contains provisions that place a cap on the number of shares of our common stock issuable upon its conversion, such that the holder thereof shall not have the right to convert any portion of the Series A Convertible Debenture to the extent that after giving effect to such conversion the holders would beneficially own more than 19.99% of the number of shares of our common stock outstanding immediately prior to such conversion.

The remaining $20.0 million in convertible notes were issued in two tranches to accredited investors during the six months ended June 30, 2003. On April 4, 2003, we issued $15.0 million of convertible, redeemable, 5-year, interest-bearing senior convertible notes (which we refer to as our 2003 senior convertible notes) and 5-year warrants to purchase an aggregate total of 1,080,000 shares of our common stock to various accredited investors. On June 12, 2003 we issued an additional $5 million of our 2003 senior convertible notes and a 5-year warrant to purchase an aggregate total of 360,000 shares of our common stock to an accredited investor. The senior convertible notes mature on March 31, 2008. The senior convertible notes bear interest at a rate of 6.0% per annum, payable quarterly in cash or shares of our common stock, at our option.

The senior convertible notes are convertible at a fixed price of $2.50 per share, unless otherwise adjusted prior to conversion pursuant to the price adjustment provisions set forth therein. The conversion price of the senior convertible notes will be lowered in the event of a sale by us of our common stock or securities convertible into our common stock at a per share offering price less than the conversion price of the senior convertible notes in effect immediately prior to such sale. The warrants are exercisable into shares of our common stock at $2.70 per share, unless otherwise adjusted prior to exercise pursuant to the price adjustment provisions that are substantially similar to those set forth in the senior convertible notes. The senior convertible notes and the warrants contain provisions that place a cap on the numbers of shares of our common stock issuable upon their conversion or exercise, such that the holders thereof shall not have the right to convert any portion of the notes to the extent that after giving effect to such conversion the holders would beneficially own more than 19.99% or 4.99%, as the case may be for the respective holder, of the number of shares of our common stock outstanding immediately prior to such conversion or exercise.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The Company has restated its Consolidated Financial Statements for the three- and nine-month periods ended September 30, 2003 to reflect a recalculation of the value of the beneficial conversion feature (BCF) attributable to the Company’s issuance of $20.0 million convertible debentures. The Company previously recorded a discount to the convertible notes, and a corresponding entry to additional paid in capital, in accordance with the Emerging Issues Task Force (EITF) No. 98-5, “Accounting for Convertible Securities with Beneficial Conversion Features or Contingently Adjustable Conversion Ratios.” The beneficial conversion feature represents the non-detachable conversion feature that is in-the-money at the commitment date and is valued by allocating a portion of the proceeds from the issuance of the convertible debentures equal to the intrinsic value of that feature to additional paid in capital. Pursuant to the original calculation, the Company had previously recorded a discount of $18.1 million, as of June 30, 2003, with respect to the two tranches of the convertible debentures. However, it has recently come to the Company’s attention that the amount of the discount assigned to the BCF should have been limited to the amount of the proceeds allocated to the convertible instrument. As a result, the Company is restating the discount associated with the convertible debentures by $4.7 million to reduce the amount recorded as of September 30, 2003. Consequently, as of September 30, 2003, there is an adjustment to reduce the unamortized discount, which is an offset to the recorded amount of the convertible debentures, with a corresponding decrease in “Additional Paid in Capital” of $5.7 million, a decrease in “Accumulated Deficit” of $1.0 million and a reduction in “Total Stockholders’ Equity” of $4.7 million. Further, the correction of this error resulted in a restatement of the Company’s interest expense and net loss for the three- and nine-month period ended September 30, 2003 to reduce the amounts previously reported by $0.6 million and $1.0 million.

General and administrative expenses for the three months ended September 30, 2003 were $709,487 compared to $657,405 for the three months ended September 30, 2002, an increase of 8%. General and administrative expenses for the nine months ended September 30, 2003 were $1,988,456 compared to $1,611,332 for the nine months ended September 30, 2002, an increase of 23%. The increase for both periods was primarily due to increased fund raising activities.

Research and development expenses for the three months ended September 30, 2003 were $5,537,669 compared to $10,180,407 for the three months ended September 30, 2002, a decrease of 46%. Research and development expenses for the nine months ended September 30, 2003 were $16,542,202 compared to $29,182,312 for the nine months ended September 30, 2002, a decrease of 43%. This decrease for both periods is primarily due to the completion of recruitment and final stages of our clinical trials. We do not accumulate cost information by major development product. Many costs are applicable to more than one product. We estimate that 95% of our research and development costs are spent on gastrointestinal and reproductive system cancers. There are no payment or penalty milestones associated with any of the projects, all of which are in Phase II or III clinical trials. We do not speculate on the timing of approvals by regulatory authorities.

Net loss for the three months ended September 30, 2003 was $7,005,478 compared to $10,923,844 for the three months ended September 30, 2002, a decrease of 36%. Net loss for the nine months ended September 30, 2003 was $19,746,565 compared to $30,845,578 for the nine months ended September 30, 2002, a decrease of 36%. The decrease in net loss is primarily a result of our lower research and development expenses, which was offset by an increase in our interest expense including amortized discount which was $786,500 for the three months ended September 30, 2003 and $1,306,500 for the nine months ended September 30, 2003 as compared to none for the three and nine months ended September 30, 2002. The interest expense including amortized discount was incurred in connection with the $20,000,000 senior convertible notes the Company issued this year and interest expense on the $3,000,000 convertible debenture issued last year. During this period we had no revenues.

We finance our operations through the sale of our equity securities, convertible debentures and licensing fees. These funds provide us with the resources to operate our business, attract and retain key personnel and scientific staff, fund our research and development program, preclinical testing and clinical trials, obtain the necessary regulatory approvals and develop our technology and products.

On September 18, 2003, we sold units consisting of an aggregate of 3,920,000 shares of common stock and five-year warrants to purchase an aggregate of 980,000 shares of common stock to a group of accredited institutional investors for gross proceeds of $22.7 million. The warrants are exercisable at any time on or after December 18, 2003 until September 18, 2008 at a price of $8.12 per share. The warrants are initially exercisable into 980,000 shares of our common stock. Each warrant includes customary anti-dilution provisions, without any price-based anti-dilution protection, and provides for cashless exercise in certain circumstances.

the holders thereof shall not have the right to convert any portion of the notes to the extent that after giving effect to such conversion the holders would beneficially own more than 19.99% or 4.99%, as the case may be for the respective holder, of the number of shares of our common stock outstanding immediately prior to such conversion or exercise.

On February 24, 2003, we issued 500,000 shares of our common stock at $2.96 per share and 150,000 warrants at $0.125 per warrant for gross proceeds of approximately $1.5 million. Each warrant entitles the holder thereof to purchase a share of our common stock at a price of $2.96 per share within the next five years.

Cash flow used in operating activities decreased to $25.0 million for the nine months ended September 30, 2003 from $28.9 million for the nine months ended September 30, 2002, primarily due to the decrease in our accounts payable of $3.9 million and a decrease in our net loss for the period. Cash flow from investing activities decreased by $1.9 million for the nine months ended September 30, 2003 from $1.9 million for the nine months ended September 30, 2002. Cash flow from financing activities increased to $42.2 million for the nine months ended September 30, 2003 compared to $32.1 million for the nine months ended September 30, 2002. During the nine months ended September 30, 2003, we received gross proceeds of approximately $20 million from the sale of the senior convertible notes and approximately 22.3 million from the sale of stock and warrants discussed above.

We believe that our existing capital resources, which consist primarily of cash and short-term cash investments, including the proceeds from the financing activities described in the preceding paragraphs, will enable us to maintain a range of operations and satisfy our periodic interest obligations into the first quarter of 2005.

Inflation and changing prices have not had a significant effect on continuing operations and are not expected to have any material effect in the foreseeable future. Interest and other income were primarily derived from money-market accounts.

In May 2003, the FASB issued SFAS 150, “Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity,” effective for financial instruments entered into or modified after May 31, 2003, and otherwise is effective at the beginning of the first interim period beginning after June 15, 2003. This statement establishes standards for how an issuer classifies and measures certain financial instruments with characteristics of both liabilities and equity. It requires that an issuer classify a freestanding financial instrument that is within its scope as a liability (or an asset in some circumstances). The adoption of SFAS 150 did not have an impact on the Company’s financial position, results of operations or cash flows.

On January 1, 2003, the Financial Accounting Standards Board issued Financial Accounting Standards Board Interpretation No. 46, Consolidation of Variable Interest Entities (“FIN 46”). FIN 46 addresses consolidation of business enterprises of variable interest entities. FIN 46 is effective immediately for all variable interest entities created after January 31, 2003 and for the first fiscal year or interim period beginning after December 2003 for variable interest entities in which an enterprise holds a variable interest that it acquired before February 1, 2003. The Company has not acquired any variable interest entities subsequent to January 31, 2003 and will therefore adopt FIN 46 for the period ending December 31, 2003. The Company is currently performing a comprehensive analysis of the impact of FIN 46, if any, on the Company’s financial position, results of operations or cash flows.

In December 2002, the FASB issued SFAS No. 148, “Accounting for Stock-Based Compensation—Transition and Disclosure, an amendment of FASB Statement No. 123.” SFAS No. 148 amends SFAS No. 123, “Accounting for Stock-Based Compensation,” to provide alternative methods of transition for a voluntary change to the fair value based method of accounting for stock-based employee compensation. In addition, SFAS No. 148 amends the disclosure requirements of SFAS No. 123 to require prominent disclosures in both annual and interim financial statements about the method of accounting for stock-based employee compensation and the effect of the method used on reported results. SFAS No. 148 is effective for fiscal years and interim periods ending after December 15, 2002. SFAS No. 148 does not amend SFAS 123 to require companies to account for employee stock options using the fair value method. We adopted the disclosure provisions required under SFAS No. 148 effective December 31, 2002.

Our significant accounting policies are described in Note 2 to the financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2002, filed with the SEC on March 31, 2003. We believe that our most critical accounting policies include the use of estimates. The impact of these estimates on results of operations in 2003 and 2002 are not significant. Our management periodically reviews these policies and estimates, the effect of which is reflected as a component of net loss in the period in which the change is known. Such changes to these estimates have not been material to our results of operations during the three and nine months ended September 30, 2003.

The value of the beneficial conversion was based upon the intrinsic value of the number of shares that would be obtained upon conversion at the commitment date. The value of the beneficial conversion feature was recorded at the closing dates and is included in the discount on the convertible debenture and in additional paid in capital. Subsequent adjustments to the conversion price will result in the measurement of addition beneficial conversion and will be measured at that time.

The fair value of the warrants was determined using the Black-Scholes valuation model. This fair value is a discount on the convertible debentures and is amortized to interest expense over the life of the debentures under the

effective interest method. As the underlying debt is converted, the pro-rata portion of the related discount related to the warrants will be expensed through interest expense.

This quarterly report contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Discussions containing “forward-looking statements” may be found in the material set forth in the section entitled, “Management’s Discussion and Analysis” as well as in the quarterly report generally.

These statements concern expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. Specifically, this quarterly report contains forward-looking statements regarding:

•

our expectations as to the adequacy of existing capital resources to maintain a range of operations and satisfy our periodic interest obligations through the first quarter of 2005; and

•

our beliefs regarding the financial impact of certain accounting pronouncements.

These forward-looking statements reflect our current views about future events and are subject to risks, uncertainties and assumptions. We caution readers that certain important factors may have affected and could in the future affect our actual results and could cause actual results to differ significantly from those expressed in any forward-looking statement. The most important factors that could prevent us from achieving our goals, and cause the assumptions underlying forward-looking statements and the actual results to differ materially from those expressed in or implied by those forward-looking statements include, but are not limited to, the following:

•

our ability to obtain additional financing or reduce our costs and expenses;

•

our ability to maintain our arrangements and collaborations with third parties for the supply of key materials and assistance in the manufacture, market, sale and distribution of any product we develop;

•

our level of debt obligations and the impact of restrictions imposed on us by the terms of this debt;

•

our ability to attract and retain highly qualified scientists and other technical personnel; and

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed by the undersigned thereunto duly authorized.


Exhibit Number		Description

31.1		Certification by Patrick T. Mooney, M.D., Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2		Certification by Frederick W. Jacobs, Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1		Certification by Patrick T. Mooney, M.D., Chief Executive Officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification by Frederick W. Jacobs, Chief Financial Officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

EX-31.1 3 g87419a1exv31w1.htm SECTION 302- CERTIFICATION CEO Section 302- Certification CEO

I, Patrick T. Mooney, M.D., Chief Executive Officer and President, certify that:

Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report; and

Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report.

EX-31.2 4 g87419a1exv31w2.htm SECTION 302- CERTIFICATION CFO Section 302- Certification CFO

I, Frederick W. Jacobs, Vice President, Chief Financial Officer, Treasurer and Chief Accounting Officer, certify that:

EX-32.1 5 g87419a1exv32w1.htm SECTION 906- CERTIFICATION CEO Section 906- Certification CEO

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q/A of Aphton Corporation (the “Company”) for the period ended September 30, 2003 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Patrick T. Mooney, M.D., Chief Executive Officer and President of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)

the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2)

the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

EX-32.2 6 g87419a1exv32w2.htm SECTION 906- CERTIFICATION CFO Section 906- Certification CFO

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q/A of Aphton Corporation (the “Company”) for the period ended September 30, 2003 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Frederick W. Jacobs, Vice President, Chief Financial Officer, Treasurer and Chief Accounting Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)

the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2)

the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


(Mark One)

x		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 for the quarterly period ended September 30, 2003

		or

o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 for the transition period from to


Delaware		95-3640931

(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

80 SW Eighth Street, Miami, Florida		33130

(address of principal executive offices)		(Zip Code)


	Number of
Class	Shares outstanding	As of
Common Stock, $0.001 par value	29,514,463	February 24, 2004


		APHTON CORPORATION

Date: February 25, 2004	By:	/s/ Patrick T. Mooney, M.D.

		Patrick T. Mooney, M.D. Chief Executive Officer and President (Principal Executive Officer)

	By:	/s/ Frederick W. Jacobs

		Frederick W. Jacobs Vice President, Chief Financial Officer, Treasurer and Chief Accounting Officer (Principal Financial Officer)


Date: February 25, 2004	Signature:	/s/ Patrick T. Mooney, M.D.

		Patrick T. Mooney, M.D. Chief Executive Officer and President (Principal Executive Officer)