Hemispherx Biopharma Inc – ‘S-3/A’ on 5/21/03

On:  Wednesday, 5/21/03, at 5:22pm ET   ·   Accession #:  891092-3-1155   ·   File #:  333-104229

in

this entire Filing. an “Entity” Search.

Show

Documents searched

and

each “hit”. the 1st “hit”.

↓↑Hints

Pre-Effective Amendment to Registration Statement for Securities Offered Pursuant to a Transaction   —   Form S-3
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: S-3/A       Pre-Effective Amendment to Registration Statement     34    137K 
                          for Securities Offered Pursuant to a                   
                          Transaction                                            
 2: EX-5.1      Opinion of Silverman Sclar Byrne Shin & Byrne          2     12K 
 3: EX-23.1     Auditors' Consent                                      1      6K 

S-3/A   —   Pre-Effective Amendment to Registration Statement for Securities Offered Pursuant to a Transaction
Document Table of Contents

S-3/A
1st Page of 34
TOC
↑Top
Previous
Next
↓Bottom
Just 1st
 
As filed with the Securities and Exchange Commission on May 21, 2003
                                                     Registration No. 333-104229

================================================================================

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

----------

PRE-EFFECTIVE AMENDMENT NO. 1 TO

FORM S-3
REGISTRATION STATEMENT
 UNDER
THE SECURITIES ACT OF 1933

----------

HEMISPHERX BIOPHARMA, INC.
(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of incorporation or organization)

52-0845822
(I.R.S. Employer Identification No.)

----------

1617 JFK Boulevard
Philadelphia, Pennsylvania 19103
(215) 988-0080

(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)

----------

William A. Carter, M.D., Chief Executive Officer
Hemispherx Biopharma, Inc.
1617 JFK Boulevard
Philadelphia, Pennsylvania 19103
(215) 988-0080

(Name, address, including zip code, and telephone number, including area code,
of agent for service) 

Copies of all communications to:
Richard Feiner, Esq.
 Silverman Sclar Byrne Shin & Byrne P.C.
 381 Park Avenue South, Suite 1601
 New York, New York, 10016
(212) 779-8600
Fax (212) 779-8858

    Approximate date of proposed sale to the public: From time to time or at
one time after the effective date of this Registration Statement.               

  If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following 
box. |_|                                                                        

    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 ("Securities Act"), other than securities offered only in connection    
with dividend or 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 a post-effective amendment filed pursuant to 462(c) under
the Securities Act, check the following box and list the Securities Act         
registration number 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. |_|                                             

================================================================================

S-3/A
2nd Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 2nd
 CALCULATION OF REGISTRATION FEE

                                                        [Enlarge/Download Table]

======================================================================================================================
                                                        Proposed Maximum      Proposed Maximum                        
Title of Each Class of              Amount to be        Offering Price Per    Aggregate Offering     Amount of        
Securities to be Registered         Registered (1)      Share                 Price                  Registration Fee 
======================================================================================================================
                                                                                                                      
Common Stock                          6,623,118(2)          $1.465(3)             $9,702,868             $784.96      
======================================================================================================================
Common Stock                               834,473          $1.465(3)             $1,222,503             $ 98.90      
======================================================================================================================
Total Registration Fee                                                                                   $883.86      
======================================================================================================================

(1)   Pursuant to Rule 416 of the Securities Act of 1933, there are also being  
      registered an indeterminate number of additional shares of common stock as
   may become offered, issuable or sold to prevent dilution resulting from
stock splits, stock dividends or similar transactions.              

(2)   Pursuant to an agreement with the beneficial holders of these shares,     
    represents 135% of the shares of common stock that are issuable upon the
      (a) conversion, prepayment or otherwise relating to Hemispherx's 6% Senior
      Convertible Debentures due 2005 issued in a private placement on March 12,
2003 and as payment of interest thereon and (b) exercise of warrants
issued by Hemispherx in the private placement.                      

(3)   Estimated solely for the purpose of computing the registration fee in     
     accordance with Rules 457(c) of the Securities Act on the basis of $1.465
    per share, which was the average of the high and low sales prices of the
   shares of common stock of the Registrant reported on the American Stock
Exchange on March 27, 2003.                                         

The Registrant hereby amends this registration statement on the date or dates as
may be necessary to delay its effective date until the Registrant shall file a  
further amendment which specifically states that this registration statement    
shall thereafter become effective in accordance with Section 8(a) of the        
Securities Act of 1933, as amended, or until the registration statement shall   
become effective on a date as the Securities and Exchange Commission, acting    
pursuant to said Section 8(a), may determine.                                   

iii 

S-3/A
3rd Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 3rd
The information in this prospectus is not complete and may be amended. Neither  
we nor the selling stockholders may 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 it is not soliciting an 
offer to buy these securities in any state where an offer or sale is not        
permitted.                                                                      

 Subject to Completion
 Preliminary Prospectus Dated May 21, 2003

HEMISPHERX BIOPHARMA, INC.

7,457,591 Shares of Common Stock

----------

The Offering:                                                                   

      This prospectus relates to the resale of 7,457,591 shares of common stock,
which consist of 135% of 4,162,725 shares of common stock issuable upon the     
conversion, redemption or other payments relating to our 6% Senior Convertible  
Debentures Due 2005 ("Debentures") and as payment of interest thereon, 135% of  
743,288 shares of common stock issuable upon the exercise of the related        
warrants ("Warrants") and 834,473 shares of common stock that are currently     
outstanding. All of these shares and Warrants were issued and sold pursuant to  
private placements to the selling stockholders listed on page 18 of this        
prospectus. We are registering these shares of common stock pursuant to         
commitments to register the shares with the selling stockholders.               

  We will not receive any proceeds from the sale of the shares of common
stock by the selling stockholders, other than payment of the exercise price of  
the Warrants.                                                                   

      Our common stock is listed on the American Stock Exchange under the symbol
HEB. The reported last sale price on the American Stock Exchange on May 16, 2003
was $2.84.                                                                      

----------

 Please see the risk factors beginning on page 3 to read about certain
factors you should consider before buying shares of common stock.               

----------

   Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined that   
this prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.                                                               

The date of this prospectus is May  , 2003

S-3/A
4th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 4th
PROSPECTUS SUMMARY

     In the following summary, we have highlighted information that we believe
is the most important about us. However, because this is a summary, it may not  
contain all information that may be important to you. You should read this      
entire prospectus, including the information incorporated by reference and the  
financial data and related notes, before making an investment decision. When    
used in this prospectus, the terms "we," "our" and "us" refer to Hemispherx and 
not to the selling stockholders.                                                

ABOUT HEMISPHERX

In the course of almost three decades, we have established a strong 
foundation of laboratory, pre-clinical and clinical data with respect to the    
development of nucleic acids to enhance the natural antiviral defense system of 
the human body and the development of therapeutic products for the treatment of 
chronic diseases. Our strategy is to obtain the required regulatory approvals   
which will allow the progressive introduction of Ampligen(R) (our proprietary   
drug) for treating Myalgic Encephalomyelitis/Chronic Fatigue Syndrome           
("ME/CFS"), HIV, Hepatitis C ("HCV") and Hepatitis B ("HBV") in the U.S., Canada
Europe and Japan. Ampligen(R) is currently in phase III clinical trials in the  
U.S. for use in treatment of ME/CFS and is in Phase IIb Clinical Trials in the  
U.S. for the treatment of newly emerged multi-drug resistant HIV, and for the   
induction of cell mediated immunity in HIV patients that are under control using
potentially toxic drug cocktails.                                               

Our proprietary drug technology utilizes specifically configured    
ribonucleic acid ("RNA") and is protected by more than 350 patents worldwide,   
with over 80 additional patent applications pending to provide further          
proprietary protection in various international markets. Certain patents apply  
to the use of Ampligen(R) alone and certain patents apply to the use of         
Ampligen(R) in combination with certain other drugs. Some compositions of matter
patents pertain to other new medications, which have a similar mechanism of     
action.                                                                         

     We have obtained from Interferon Sciences, Inc. all of its raw materials,
work-in-progress and finished product Alferon N(R), together with an exclusive  
license to sell Alferon N(R) in a natural alpha interferon that has been        
approved for commercial sale for the treatment of genital warts. We intend to   
market the Alferon N(R) in the United State through sales facilitated via third 
party marketing agreements. Additionally, we intend to implement studies testing
the efficacy of Alferon N(R) in multiple sclerosis and other chronic viral      
diseases.                                                                       

 We were incorporated in Maryland in 1966 under the name HEM Research,
Inc., and originally served as a supplier of research support products. Our     
business was redirected in the early 1980's to the development of nucleic acid  
pharmaceutical technology and the commercialization of RNA drugs. We were       
reincorporated in Delaware and changed our name to HEM Pharmaceutical Corp., in 
1991 and to Hemispherx Biopharma, Inc., in June 1995. We have three domestic    
subsidiaries 'BioPro Corp., BioAegean Corp., and Core BioTech Corp., all of     
which are incorporated in Delaware. Our foreign subsidiaries include Hemispherx 
Biopharma Europe N.V./S.A. established in Belgium in 1998 and Hemispherx        
Biopharma Europe S.A. ("Hemispherx, S.A.") incorporated in Luxembourg in 2002.  

S-3/A
5th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 5th
    Our principal executive offices are located at One Penn Center, 1617 JFK
Boulevard, Philadelphia, Pennsylvania 19103, and its telephone number is        
215-988-0080.                                                                   

RISK FACTORS

 Special Note Regarding Forward-Looking Statements

Certain statements in this document constitute "forwarding-looking  
statements" within the meaning of Section 27A of the Securities Act of 1933, as 
amended, and Section 21E of the Securities and Exchange Act of 1995             
(collectively, the "Reform Act"). Certain, but not necessarily all, of such     
forward-looking statements can be identified by the use of forward-looking      
terminology such as "believes," "expects," "may," "will," "should," or          
"anticipates" or the negative thereof or other variations thereon or comparable 
terminology, or by discussions of strategy that involve risks and uncertainties.
All statements other than statements of historical fact, included in this       
prospectus regarding our financial position, business strategy and plans or     
objectives for future operations are forward-looking statements. Without        
limiting the broader description of forward-looking statements above, we        
specifically note that statements regarding potential drugs, their potential    
therapeutic effect, the possibility of obtaining regulatory approval, our       
ability to manufacture and sell any products, market acceptance or our ability  
to earn a profit from sales or licenses of any drugs or our ability to discover 
new drugs in the future are all forward-looking in nature.                      

Such forward-looking statements involve known and unknown risks,    
uncertainties and other factors, including but not limited to, the risk factors 
discussed below, which may cause the actual results, performance or achievements
of Hemispherx and its subsidiaries to be materially different from any future   
results, performance or achievements expressed or implied by such               
forward-looking statements and other factors referenced in this prospectus. We  
do not undertake and specifically declines any obligation to publicly release   
the results of any revisions which may be made to any forward-looking statement 
to reflect events or circumstances after the date of such statements or to      
reflect the occurrence of anticipated or unanticipated events.                  

     The following cautionary statements identify important factors that could
cause our actual result to differ materially form those projected in the        
forward-looking statements made in this Prospectus. Among the key factors that  
have a direct bearing on our results of operations are:                         

No assurance of successful product development                                  

    Ampligen(R) and related products. The development of Ampligen(R) and our
other related products is subject to a number of significant risks. Ampligen(R) 
may be found to be ineffective or to have adverse side effects, fail to receive 
necessary regulatory clearances, be difficult to manufacture on a commercial    
scale, be uneconomical to market or be precluded from commercialization by      
proprietary right of third parties. Our products are in various stages of       
clinical and pre-clinical development and, require further clinical studies and 
appropriate regulatory approval processes before any such products can be       
marketed. We do not know                                                        

3 

S-3/A
6th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 6th
when, or if ever, Ampligen(R) or our other products will be generally available 
for commercial sale for any indication. Generally, only a small percentage of   
potential therapeutic products are eventually approved by the U.S. Food and Drug
Administration ("FDA") for commercial sale.                                     

ALFERON N Injection(R). Although ALFERON N Injection is approved for
marketing for the treatment of genital warts, to date it has not been approved  
for other applications. We face many of the risks discussed above, with regard  
to developing this product for use to treat other ailments such as multiple     
sclerosis and cancer.                                                           

Our drug and related technologies are investigational and subject to regulatory 
approval. If we are unable to obtain regulatory approval, our operations will be
significantly affected.                                                         

All of our drugs and associated technologies other than ALFERON N   
Injection are investigational and must receive prior regulatory approval by     
appropriate regulatory authorities for general use and are currently legally    
available only through clinical trials with specified disorders. At present,    
ALFERON N Injection is only approved for the treatment of genital warts. Use of 
ALFERON N Injection for other applications will require regulatory approval. In 
this regard, Interferon Sciences, Inc., the Company from which we obtained our  
rights to ALFERON N Injection, conducted clinical trials related to use of      
ALFERON N Injection for treatment of HIV and Hepatitis C. In both instances, the
FDA determined that additional studies were necessary in order to fully evaluate
the efficacy of ALFERON N Injection(R) in the treatment of HIV and Hepatitis C  
diseases. We have no obligation or plans to conduct these additional studies at 
this time. Our principal development efforts are currently focused on           
Ampligen(R), which has not been approved for commercial use. Our products,      
including Ampligen(R), are subject to extensive regulation by numerous          
governmental authorities in the U.S. and other countries, including, but not    
limited to, the FDA in the U.S., the Health Protection Branch("HPB") of Canada, 
and the European Medical Evaluation Agency ("EMEA") in Europe. Obtaining        
regulatory approvals is a rigorous and lengthy process and requires the         
expenditure of substantial resources. In order to obtain final regulatory       
approval of a new drug, we must demonstrate to the satisfaction of the          
regulatory agency that the product is safe and effective for its intended uses  
and that we are capable of manufacturing the product to the applicable          
regulatory standards. We require regulatory approval in order to market         
Ampligen(R) or any other proposed product and receive product revenues or       
royalties. We cannot assure you that Ampligen(R) will ultimately be demonstrated
to be safe or efficacious. In addition, while Ampligen(R) is authorized for use 
in clinical trials in the United States and other countries, we cannot assure   
you that additional clinical trial approvals will be authorized in the United   
States or in other countries, in a timely fashion or at all, or that we will    
complete these clinical trials. If Ampligen(R) or one of our other products does
not receive regulatory approval in the U.S. or elsewhere, our operations will be
materially adversely effected.                                                  

We may continue to incur substantial losses and our future profitability is     
uncertain.                                                                      

      We began operations in 1966 and last reported net profit from 1985 through
1987. Since 1987, we have incurred substantial operating losses, as we pursued  
our clinical trial effort and expanded our efforts in Europe. As of March 31,   
2003 our accumulated deficit was                                                

4 

S-3/A
7th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 7th
approximately $101,000,000. We have not yet generated significant revenues from 
our products and may incur substantial and increased losses in the future. We   
cannot assure that we will ever achieve significant revenues from product sales 
or become profitable. We require, and will continue to require, the commitment  
of substantial resources to develop our products. We cannot assure that our     
product development efforts will be successfully completed or that required     
regulatory approvals will be obtained or that any products will be manufactured 
and marketed successfully, or profitability.                                    

We may require additional financing which may not be available.                 

      The development of our products will require the commitment of substantial
resources to conduct the time-consuming research, preclinical development, and  
clinical trials that are necessary to bring pharmaceutical products to market.  
Based upon our current operating plan, we anticipate that we will need          
approximately $5,400,000 over the next 12 months, inclusive of revenues and     
financing, to sustain our operations. In March 2003, we received $2,873,000 in  
initial net proceeds from the sale of the Debentures and Warrants and, pursuant 
to the terms of the Debentures, if and when we close on the second Interferon   
Sciences asset acquisition, we will receive additional net proceeds of          
$1,550,000. We anticipate receipt of revenues and proceeds from the sales of    
Ampligen(R) under the Cost Recovery Clinical Programs and, possibly, funds from 
the exercise of outstanding non-public warrants. We also anticipate significant 
revenues from our recently acquired commercial product, Alferon N. As of May 1, 
2003, we had approximately $3.6 Million in cash and short term investments. We  
believe that these funds plus 1) the anticipated infusion of approximately $1.55
million in remaining net proceeds from the Debenture placement and 2) the       
projected net cash flow from the sale of ALFERON N should be sufficient to meet 
our operating requirement for the next 12 months. We may need to raise          
additional funds through additional equity or debt financing or from other      
sources in order to complete the necessary clinical trials and the regulatory   
approval processes and begin commercializing Ampligen(R) products. There can be 
no assurances that we will raise adequate funds from these or other sources,    
which may have a material effect on our ability to develop our products. In     
addition, if we do not timely complete the second ISI asset acquisition, our    
financial condition could be materially and adversely affected (see the next    
risk factor).                                                                   

If we do not complete the second Interferon Sciences asset acquisition, our     
ability to generate revenues from the sale of ALFERON N Injection and our       
financial condition will be adversely affected.                                 

    In March, 2003 we executed two agreements with Interferon Sciences, Inc.
("ISI") to purchase certain assets of ISI. In the first agreement we acquired   
ISI's inventory of ALFERON N Injection(R) and a limited license for the         
production, manufacture, use, marketing and sale of this product. Our ability to
generate sustained revenues from sales of this product is dependent, among other
things, on our completing the terms of the second agreement to acquire the      
balance of ISI's rights to its product as well as ISI's production facility used
to formulate and purify the drug concentrate of ALFERON N Injection(R). In      
addition, pursuant to the terms of the Debentures, we are required to acquire   
ISI's facility within 90 days from March 12, 2003 and, unless and until we      
acquire the facility, $1,550,000 of the proceeds from the sale of the Debentures

5 

S-3/A
8th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 8th
has been held back. Consummation of the second agreement requires, among other  
things, approval by ISI's shareholders and certain environmental approvals with 
regard to the sale of the facility. As of the date hereof, there is the         
possibility that either or both approvals may not be obtained within the        
required 90 day period. Our failure to complete the acquisition within the 90   
day period would be a technical default of the terms of the Debentures and,     
absent consent from the Debenture holders for additional time, most likely would
result in our having to redeem the securities. If we do not receive the         
additional Debenture funds as planned and, especially if we are required to     
redeem the Debentures, our financial condition would be materially and adversely
affected and we would probably have to reduce or possibly curtail operational   
spending including some critical clinical effort.                               

The limited number of unissued and unreserved authorized shares of Common Stock 
severely restricts our ability to raise funds through the sale of our           
securities.                                                                     

 We have a limited number of shares of Common Stock authorized but not
issued or reserved for issuance upon conversion or exercise of outstanding      
convertible and exercisable securities such as debentures, options and warrants.
As of May 1, 2003, only approximately 1,157,000 shares of our authorized shares 
of Common Stock will not be issued or reserved for issuance. Unless and until we
are able to increase the number of authorized shares of Common Stock, our       
ability to raise funds through the sale of Common Stock or instruments that are 
convertible into or exercisable for Common Stock will be severely restricted.   
Although we intend to ask our stockholders at our next annual meeting to approve
an amendment to our Certificate of Incorporation to increase the shares of      
Common Stock we are authorized to issue, we cannot assure you that we will be   
able to obtain this approval.                                                   

We have guaranteed the value of a number of shares issued and to be issued as a 
result of our acquisition of assets from Interferon Sciences. If our share price
is not above $1.59 per share 12 or 18 months after the dates of issuance of the 
guaranteed shares, our financial condition could be adversely affected.         

   In March 2003 we issued 487,028 shares to Interferon Sciences and, upon
the completion of the second Interferon Sciences asset acquisition, we will     
issue an additional 487,028 shares to Interferon Sciences and an aggregate of   
581,761 shares to two of Interferon Sciences' creditors. We anticipate, but     
cannot assure, that we will close the second Interferon Sciences asset          
acquisition by mid June, 2003. We have guaranteed the value of up to 1,430,817  
of these shares to be $1.59 per share or $2,275,000 in the aggregate on the     
relevant termination dates. The termination dates are 18 months after the dates 
of issuance of the guaranteed shares to ISI and GP Strategies, and 12 months    
after the date of issuance of the guaranteed shares to the American National Red
Cross. The guarantee relates only to those shares still held by Interferon      
Sciences and the two creditors on the applicable termination date. If, within 30
days after the relevant termination date, holders of the guaranteed shares      
request that we honor the guarantees, we will reacquire the holders' remaining  
guaranteed shares and pay the holders $1.59 per share. By way of example,       
assuming that all 1,430,817 shares are still held on the relevant termination   
dates, we would be obligated to pay to Interferon Sciences and these two        
creditors an aggregate of $2,275,000. The reported last sale price for our      
common stock on the American Stock Exchange                                     

6 

S-3/A
9th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 9th
on May 16, 2003 was $2.84 per share. If, during the 31 days commencing on the   
relevant termination dates, the market price of our stock is not above $1.59 per
share, we most likely would be requested and obligated to pay the guaranteed    
amount on the guaranteed shares outstanding on the relevant termination dates.  
We believe that the number of guaranteed shares still outstanding on the        
relevant termination dates will be a factor of the market price and sales volume
of our common stock during the 18 month period prior to the relevant termination
date.                                                                           

    If the holders of the guaranteed shares do not sell a significant amount
of their guaranteed shares prior to the relevant termination dates and the price
of our common stock during the 31 day period commencing on the relevant         
termination dates is not above $1.59 per share, we most likely will be required 
to repurchase a significant number of guaranteed shares and our financial       
condition could be materially and adversely affected.                           

We may not be profitable unless we can protect our patents and/or receive       
approval for additional pending patents.                                        

   We need to preserve and acquire enforceable patents covering the use of
Ampligen(R) for a particular disease in order to obtain exclusive rights for the
commercial sale of Ampligen(R) for such disease. If and when we obtain all      
rights to ALFERON N Injection, we will need to preserve and acquire enforceable 
patents covering its use for a particular disease too. Our success depends, in  
large part, on our ability to preserve and obtain patent protection for our     
products and to obtain and preserve our trade secrets and expertise. Certain of 
our know-how and technology is not patentable, particularly the procedures for  
the manufacture of our drug product which are carried out according to standard 
operating procedure manuals. We have been issued certain patents including those
on the use of Ampligen(R) and Ampligen(R) in combination with certain other     
drugs for the treatment of HIV. We also have been issued patents on the use of  
Ampligen(R) in combination with certain other drugs for the treatment of chronic
hepatitis B virus, chronic hepatitis C virus, and a patent which affords        
protection on the use of Ampligen(R) in patients with chronic fatigue syndrome. 
We have not yet been issued any patents in the United States for the use of     
Ampligen(R) as a sole treatment for any of the cancers which we have sought to  
target. With regard to ALFERON N Injection, Interferon Sciences, Inc. has a     
patent for Natural Alpha Interferon produced from human peripheral blood        
leukocytes and its production process and has additional patent applications    
pending. We will acquire this patent and related patent applications if and when
we close on the second Interferon Sciences asset acquisition We cannot assure   
you that any of these applications will be approved or that our competitors will
not seek and obtain patents regarding the use of our products in combination    
with various other agents, for a particular target indication prior to us. If we
cannot protect our patents covering the use of our products for a particular    
disease, or obtain additional pending patents, we may not be able to            
successfully market our products.                                               

The patent position of biotechnology and pharmaceutical firms is highly         
uncertain and involves complex legal and factual questions.                     

To date, no consistent policy has emerged regarding the breadth of  
protection afforded by pharmaceutical and biotechnology patents. There can be no
assurance that new patent                                                       

7 

S-3/A
10th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 10th
applications relating to our products or technology will result in patents being
issued or that, if issued, such patents will afford meaningful protection       
against competitors with similar technology. It is generally anticipated that   
there may be significant litigation in the industry regarding patent and        
intellectual property rights. Such litigation could require substantial         
resources from us and we may not have the financial resources necessary to      
enforce the patent rights that we hold. No assurance can be made that our       
patents will provide competitive advantages for our products or will not be     
successfully challenged by competitors. No assurance can be given that patents  
do not exist or could not be filed which would have a materially adverse effect 
on our ability to develop or market our products or to obtain or maintain any   
competitive position the we may achieve with respect to our products. Our       
patents also may not prevent others from developing competitive products using  
related technology.                                                             

There can be no assurance that we will be able to obtain necessary licenses if  
we cannot enforce patent rights we may hold. In addition, the failure of third  
parties from whom we currently license certain proprietary information or may be
required to obtain such licenses in the future, to adequately enforce their     
rights to such proprietary information, could adversely affect the value of such
licenses to us.                                                                 

If we cannot enforce the patent rights we currently hold we may be  
required to obtain licenses from others to develop, manufacture or market our   
products. There can be no assurance that we would be able to obtain any such    
licenses on commercially reasonable terms, if at all. We currently license      
certain proprietary information from third parties, some of which may have been 
developed with government grants under circumstances where the government       
maintained certain rights with respect to the proprietary information developed.
No assurances can be given that such third parties will adequately enforce any  
rights they may have or that the rights, if any, retained by the government will
not adversely affect the value of our license.                                  

There is no guarantee that our trade secrets will not be disclosed or known by  
our competitors.                                                                

  To protect our rights, we require certain employees and consultants to
enter into confidentiality agreements with us. There can be no assurance that   
these agreements will not be breached, that we would have adequate and          
enforceable remedies for any breach, or that any trade secrets of ours will not 
otherwise become known or be independently developed by competitors.            

If our distributors do not market our product successfully, we may not generate 
significant revenues or become profitable.                                      

 We have limited marketing and sales capability. We need to enter into
marketing agreements and third party distribution agreements for our products in
order to generate significant revenues and become profitable. To the extent that
we enter into co-marketing or other licensing arrangements, any revenues        
received by us will be dependent on the efforts of third parties, and there is  
no assurance that these efforts will be successful. Our agreement with Gentiva  
Health Services offers the potential to provide significant marketing and       
distribution capacity in the United States while licensing and marketing        
agreements with certain foreign                                                 

8 

S-3/A
11th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 11th
firms should provide an adequate sales force in South America, Africa, United   
Kingdom, Australia and New Zealand, Canada, Austria, Spain and Portugal.        

     We cannot assure that our domestic or our foreign marketing partners will
be able to successfully distribute our products, or that we will be able to     
establish future marketing or third party distribution agreements on terms      
acceptable to us, or that the cost of establishing these arrangements will not  
exceed any product revenues. The failure to continue these arrangements or to   
achieve other such arrangements on satisfactory terms could have a materially   
adverse effect on us.                                                           

No Guaranteed Source Of Required Materials.                                     

   A number of essential materials are used in the production of ALFERON N
Injection, including human white blood cells, and we have a limited number of   
sources from which to obtain such materials. We do not have long-term agreements
for the supply of any of such materials. There can be no assurance we can enter 
into long-term supply agreements covering essential materials on commercially   
reasonable terms, if at all. If we are unable to obtain the required raw        
materials, we may be required to scale back our operations or stop manufacturing
ALFERON N Injection. The costs and availability of products and materials we    
need for the commercial production of ALFERON N Injection and other products    
which we may commercially produce are subject to fluctuation depending on a     
variety of factors beyond our control, including competitive factors, changes in
technology, and FDA and other governmental regulations and there can be no      
assurance that we will be able to obtain such products and materials on terms   
acceptable to us or at all.                                                     

There is no assurance that successful manufacture of a drug on a limited scale  
basis for investigational use will lead to a successful transition to           
commercial, large-scale production.                                             

Small changes in methods of manufacturing may affect the chemical   
structure of Ampligen(R) and other RNA drugs, as well as their safety and       
efficacy. Changes in methods of manufacture, including commercial scale-up may  
affect the chemical structure of Ampligen(R) and, can, among other things,      
require new clinical studies and affect orphan drug status, particularly, market
exclusivity rights , if any, under the Orphan Drug Act. The transition from     
limited production of pre-clinical and clinical research quantities to          
production of commercial quantities of our products will involve distinct       
management and technical challenges and will require additional management and  
technical personnel and capital to the extent such manufacturing is not handled 
by third parties. There can be no assurance that our manufacturing will be      
successful or that any given product will be determined to be safe and          
effective, capable of being manufactured economically in commercial quantities  
or successfully marketed.                                                       

We have limited manufacturing experience and capacity.                          

   Ampligen(R) is currently produced only in limited quantities for use in
our clinical trials and we are dependent upon certain third party suppliers for 
key components of our products and for substantially all of the production      
process. The failure to continue these arrangements or to                       

9 

S-3/A
12th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 12th
achieve other such arrangements on satisfactory terms could have a material     
adverse affect on us. Also, to be successful, our products must be manufactured 
in commercial quantities in compliance with regulatory requirements and at      
acceptable costs. To the extent we are involved in the production process, our  
current facilities are not adequate for the production of our proposed products 
for large-scale commercialization, and we currently do not have adequate        
personnel to conduct commercial-scale manufacturing. We intend to utilize       
third-party facilities if and when the need arises or, if we are unable to do   
so, to build or acquire commercial-scale manufacturing facilities. We will need 
to comply with regulatory requirements for such facilities, including those of  
the FDA and HPB pertaining to current Good Manufacturing Practices ("cGMP")     
regulations. There can be no assurance that such facilities can be used, built, 
or acquired on commercially acceptable terms, or that such facilities, if used, 
built, or acquired, will be adequate for our long-term needs.                   

  The purified drug concentrate utilized in the formulation of ALFERON N
Injection is manufactured in Interferon Science's facility and ALFERON N        
Injection is formulated and packaged at a production facility operated by       
Abbott. if and when we close on the second Interferon Sciences asset            
acquisition, we will acquire this facility. We still will be dependent upon     
Abbott Laboratories and/or another third party for product formulation and      
packaging.                                                                      

We may not be profitable unless we can produce Ampligen(R) or other products in 
commercial quantities at costs acceptable to us.                                

We have never produced Ampligen(R) or any other products in large   
commercial quantities. Ampligen(R) is currently produced for use in clinical    
trials. We must manufacture our products in compliance with regulatory          
requirements in large commercial quantities and at acceptable costs in order for
us to be profitable. We intend to utilize third-party manufacturers and/or      
facilities if and when the need arises or, if we are unable to do so, to build  
or acquire commercial-scale manufacturing facilities. If we cannot manufacture  
commercial quantities of Ampligen(R) or enter into third party agreements for   
its manufacture at costs acceptable to us, our operations will be significantly 
affected.                                                                       

Rapid technological change may render our products obsolete or non-competitive. 

    The pharmaceutical and biotechnology industries are subject to rapid and
substantial technological change. Technological competition from pharmaceutical 
and biotechnology companies, universities, governmental entities and others     
diversifying into the field is intense and is expected to increase. Most of     
these entities have significantly greater research and development capabilities 
than us, as well as substantial marketing, financial and managerial resources,  
and represent significant competition for us. There can be no assurance that    
developments by others will not render our products or technologies obsolete or 
noncompetitive or that we will be able to keep pace with technological          
developments.                                                                   

10

S-3/A
13th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 13th
Our products may be subject to substantial competition.                         

   Ampligen(R). Competitors may be developing technologies that are, or in
the future may be, the basis for competitive products. Some of these potential  
products may have an entirely different approach or means of accomplishing      
similar therapeutic effects to products being developed by us. These competing  
products may be more effective and less costly than our products. In addition,  
conventional drug therapy, surgery and other more familiar treatments may offer 
competition to our products. Furthermore, many of our competitors have          
significantly greater experience than us in pre-clinical testing and human      
clinical trials of pharmaceutical products and in obtaining FDA, HPB and other  
regulatory approvals of products. Accordingly, our competitors may succeed in   
obtaining FDA, HPB or other regulatory product approvals more rapidly than us.  
There are no drugs approved for commercial sale with respect to treating ME/CFS 
and we have no knowledge of any ME/CFS drugs being developed by others. The     
dominant competitors with drugs to treat HIV diseases include Gilead            
Pharmaceutical, Pfizer, Bristol-Myers, Abbott Labs and Schering-Plough Corp.    
("Shering"). These potential competitors are among the largest pharmaceutical   
companies in the world, are well known to the public and the medical community, 
and have substantially greater financial resources, product development, and    
manufacturing and marketing capabilities than we have. Although we believe our  
principal advantage is the unique mechanism action of Ampligen(R) on the immune 
system, we cannot assure that we will be able to compete.                       

    ALFERON N Injection(R). Many potential competitors are among the largest
pharmaceutical companies in the world, are well known to the public and the     
medical community, and have substantially greater financial resources, product  
development, and manufacturing and marketing capabilities than we have. ALFERON 
N Injection currently competes with Schering's injectable recombinant alpha     
interferon product (INTRON(R) A) for the treatment of genital warts. 3M         
Pharmaceuticals also received FDA approval for its immune-response modifier,    
Aldara(R), a self-administered topical cream, for the treatment of external     
genital and perianal warts. ALFERON N Injection also competes with surgical,    
chemical, and other methods of treating genital warts. We cannot assess the     
impact products developed by our competitors, or advances in other methods of   
the treatment of genital warts, will have on the commercial viability of ALFERON
N Injection. If and when we obtain additional approvals of uses of this product,
we expect to compete primarily on the basis of product performance. Our         
potential competitors have developed or may develop products (containing either 
alpha or beta interferon or other therapeutic compounds) or other treatment     
modalities for those uses. In the United States, two recombinant forms of beta  
interferon have been approved for the treatment of relapsing-remitting multiple 
sclerosis. There can be no assurance that, if we are able to obtain regulatory  
approval of ALFERON N Injection for the treatment of new indications, we will be
able to achieve any significant penetration into those markets. In addition,    
because certain competitive products are not dependent on a source of human     
blood cells, such products may be able to be produced in greater volume and at a
lower cost than ALFERON N Injection. Currently, Interferon Sciences' wholesale  
price on a per unit basis of ALFERON N Injection is substantially higher than   
that of the competitive recombinant alpha and beta interferon products.         

11

S-3/A
14th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 14th
    General. Other companies may succeed in developing products earlier than
we do, obtaining approvals for such products from the FDA more rapidly than we  
do, or developing products that are more effective than those we may develop.   
While we will attempt to expand our technological capabilities in order to      
remain competitive, there can be no assurance that research and development by  
others or other medical advances will not render our technology or products     
obsolete or non-competitive or result in treatments or cures superior to any    
therapy we develop.                                                             

Possible side effects from the use of Ampligen(R) or ALFERON N Injection could  
adversely effect potential revenues and physician/patient acceptability of our  
product.                                                                        

      Ampligen(R). We believe that Ampligen(R) has been generally well tolerated
with a low incidence of clinical toxicity, particularly given the severely      
debilitating or life threatening diseases that have been treated. A mild        
flushing reaction has been observed in approximately 15% of patients treated in 
our various studies. This reaction is occasionally accompanied by a rapid heart 
beat, a tightness of the chest, urticaria (swelling of the skin), anxiety,      
shortness of breath, subjective reports of "feeling hot," sweating and nausea.  
The reaction is usually infusion-rate related and can generally be controlled by
slowing the infusion rate. Other adverse side effects include liver enzyme level
elevations, diarrhea, itching, asthma, low blood pressure, photophobia, rash,   
transient visual disturbances, irregular heart rate, decreased visual activity  
in platelets and white blood cell counts, anemia, dizziness, confusion,         
elevation of kidney function tests, occasional temporary hair loss and various  
flu-like symptoms, including fever, chills, fatigue, muscular aches, joint      
pains, headaches, nausea and vomiting. These flu-like side effects typically    
subside within several months. One or more of the potential side effects might  
deter usage of Ampligen(R) in certain clinical situations and therefore, could  
adversely effect potential revenues and physician/patient acceptability of our  
product.                                                                        

    ALFERON N Injection(R). At present, ALFERON N Injection is only sold for
the intralesional (with in the lesion) treatment of refractory or recurring     
external genital warts in adults. In clinical trials conducted for the treatment
of genital warts with ALFERON N Injection, patients did not experience serious  
side effects; however, there can be no assurance that unexpected or unacceptable
side effects will not be found in the future for this use or other potential    
uses of ALFERON N Injection which could threaten or limit such product's        
usefulness.                                                                     

We may be subject to product liability claims from the use of Ampligen(R) or    
other of our products which could negatively affect our future operations.      

     We face an inherent business risk of exposure to product liability claims
in the event that the use of Ampligen(R) or other of our products results in    
adverse effects. This liability might result from claims made directly by       
patients, hospitals, clinics or other consumers, or by pharmaceutical companies 
or others manufacturing these products on our behalf. Our future operations may 
be negatively effected from the litigation costs, settlement expenses and lost  
product sales inherent to these claims. While we will continue to attempt to    
take appropriate precautions, we cannot assure that we will avoid significant   
product liability exposure. Although we currently maintain product              

12

S-3/A
15th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 15th
liability insurance coverage, there can be no assurance that this insurance will
provide adequate coverage against product liability claims. A successful product
liability claim against us in excess of our $1,000,000 in insurance coverage or 
for which coverage is not provided could have a negative effect on our business 
and financial condition.                                                        

The loss of Dr. Carter's services could hurt our chances for success.           

      Our success is dependent on the continued efforts of Dr. William A. Carter
because of his position as a pioneer in the field of nucleic acid drugs, his    
being the co-inventor of Ampligen(R), and his knowledge of our overall          
activities, including patents, clinical trials. The loss of Dr. Carter's        
services could have a material adverse effect on our operations and chances for 
success. While we have an employment agreement with Dr. Carter, and have secured
key man life insurance in the amount of $2 million on the life of Dr. Carter,   
the loss of Dr. Carter or other personnel, or the failure to recruit additional 
personnel as needed could have a materially adverse effect on our ability to    
achieve our objectives.                                                         

Uncertainty of health care reimbursement for our products.                      

  Our ability to successfully commercialize our products will depend, in
part, on the extent to which reimbursement for the cost of such products and    
related treatment will be available from government health administration       
authorities, private health coverage insurers and other organizations.          
Significant uncertainty exists as to the reimbursement status of newly approved 
health care products, and from time to time legislation is proposed, which, if  
adopted, could further restrict the prices charged by and/or amounts            
reimbursable to manufacturers of pharmaceutical products. We cannot predict     
what, if any, legislation will ultimately be adopted or the impact of such      
legislation on us. There can be no assurance that third party insurance         
companies will allow us to charge and receive payments for products sufficient  
to realize an appropriate return on our investment in product development.      

There are risks of liabilities associated with handling and disposing of        
hazardous materials.                                                            

Our business involves the controlled use of hazardous materials,    
carcinogenic chemicals and various radioactive compounds. Although we believe   
that our safety procedures for handling and disposing of such materials comply  
in all material respects with the standards prescribed by applicable            
regulations, the risk of accidental contamination or injury from these materials
cannot be completely eliminated. In the event of such an accident or the failure
to comply with applicable regulations, we could be held liable for any damages  
that result, and any such liability could be significant. We do not maintain    
insurance coverage against such liabilities.                                    

The market price of our stock may be adversely affected by market volatility.   

The market price of our common stock has been and is likely to be   
volatile. In addition to general economic, political and market conditions, the 
price and trading volume of our stock could fluctuate widely in response to many
factors, including:                                                             

13

S-3/A
16th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 16th
o     announcements of the results of clinical trials by us or our competitors; 

o     adverse reactions to products;                                            

o     governmental approvals, delays in expected governmental approvals or      
   withdrawals of any prior governmental approvals or public or regulatory
  agency concerns regarding the safety or effectiveness of our products;

o     changes in U.S. or foreign regulatory policy during the period of product 
development;                                                        

o     developments in patent or other proprietary rights, including any third   
party challenges of our intellectual property rights;               

o     announcements of technological innovations by us or our competitors;      

o     announcements of new products or new contracts by us or our competitors;  

o     actual or anticipated variations in our operating results due to the level
of development expenses and other factors;                          

o     changes in financial estimates by securities analysts and whether our     
earnings meet or exceed the estimates;                              

o     conditions and trends in the pharmaceutical and other industries;         

o     new accounting standards; and                                             

o     the occurrence of any of the risks described in these "Risk Factors."     

    Our common stock is listed for quotation on the American Stock Exchange.
For the 12-month period ended December 31, 2002, the price of our common stock  
has ranged from $0.74 to $4.95. We expect the price of our common stock to      
remain volatile. The average daily trading volume in our common stock varies    
significantly. Our relatively low average volume and low average number of      
transactions per day may affect the ability of our stockholders to sell their   
shares in the public market at prevailing prices and a more active market may   
never develop.                                                                  

   In the past, following periods of volatility in the market price of the
securities of companies in our industry, securities class action litigation has 
often been instituted against companies in our industry. If we face securities  
litigation in the future, even if without merit or unsuccessful, it would result
in substantial costs and a diversion of management attention and resources,     
which would negatively impact our business.                                     

Our stock price may be adversely affected if a significant amount of shares,    
primarily those registered herein, are sold in the public market.               

As of May 1, 2003, approximately 834,445 shares of our common stock,
constituted "restricted securities" as defined in Rule 144 under the Securities 
Act of 1933. In addition, we have registered 5,967,820 shares issuable upon the 
conversion of 135% of the Debentures and as payment of interest thereon. All of 
these shares are registered herein pursuant to agreements between us and the    
purchasers in our recent private placements, requiring us to register their     
shares for resale under the Securities Act. This permits the sale of registered 
shares of common stock in the open market or in privately negotiated            
transactions without compliance with the requirements of Rule 144. In addition, 
as of May 1, 2003, we had options and warrants outstanding for the purchase of  
an aggregate of approximately 9,710,035 shares of our common stock, which       
includes 135% of the shares issuable upon exercise of the Warrants. To the      
extent the exercise price of the options and warrants is less than the market   
price of the common stock, the holders of the options                           

14

S-3/A
17th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 17th
and warrants are likely to exercise them and sell the underlying shares of      
common stock and to the extent that the conversion price and exercise price of  
these securities are adjusted pursuant to anti-dilution protection, the         
securities could be exercisable or convertible for even more shares of common   
stock. Moreover, we anticipate that we will be issuing and registering for      
public resale 1,068,789 shares if and when we acquire additional assets from    
Interferon Sciences, Inc. and, possibly, additional shares to raise funding or  
compensate employees, consultants and/or directors. We are unable to estimate   
the amount, timing or nature of future sales of outstanding common stock. Sales 
of substantial amounts of our common stock in the public market could cause the 
market price for our common stock to decrease. Furthermore, a decline in the    
price of our common stock would likely impede our ability to raise capital      
through the issuance of additional shares of common stock or other equity       
securities.                                                                     

Provisions of our Certificate of Incorporation and Delaware law could defer a   
change of our management which could discourage or delay offers to acquire us.  

    Provisions of our Certificate of Incorporation and Delaware law may make
it more difficult for someone to acquire control of us or for our stockholders  
to remove existing management, and might discourage a third party from offering 
to acquire us, even if a change in control or in management would be beneficial 
to our stockholders. For example, our Certificate of Incorporation allows us to 
issue shares of preferred stock without any vote or further action by our       
stockholders. Our Board of Directors has the authority to fix and determine the 
relative rights and preferences of preferred stock. Our Board of Directors also 
has the authority to issue preferred stock without further stockholder approval.
As a result, our Board of Directors could authorize the issuance of a series of 
preferred stock that would grant to holders the preferred right to our assets   
upon liquidation, the right to receive dividend payments before dividends are   
distributed to the holders of common stock and the right to the redemption of   
the shares, together with a premium, prior to the redemption of our common      
stock. In this regard, in November, 2002 we adopted a shareholder rights plan   
and, under the Plan, our Board of Directors declared a dividend distribution of 
one Right for each outstanding share of Common Stock to stockholders of record  
at the close of business on November 29, 2002. Each Right initially entitles    
holders to buy one unit of preferred stock for $30.00. The Rights generally are 
not transferable apart from the common stock and will not be exercisable unless 
and until a person or group acquires or commences a tender or exchange offer to 
acquire, beneficial ownership of 15% or more of our common stock. However, for  
William A. Carter, M.D., our chief executive officer, who already beneficial    
owns 11.4% of the our common stock, the Plan's threshold will be 20%, instead of
15%. The Rights will expire on November 19, 2012, and may be redeemed prior     
thereto at $.01 per Right under certain circumstances.                          

    Because the risk factors referred to above could cause actual results or
outcomes to differ materially from those expressed in any forward-looking       
statements made by us, you should not place undue reliance on any such          
forward-looking statements. Further, any forward-looking statement speaks only  
as of the date on which it is made and we undertake no obligation to update any 
forward-looking statement or statements to reflect events or circumstances after
the date on which such statement is made or reflect the occurrence of           
unanticipated events. New factors emerge from time to time, and it is not       
possible for us to predict which will arise. In                                 

15

S-3/A
18th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 18th
addition, we cannot assess the impact of each factor on our business or the     
extent to which any factor, or combination of factors, may cause actual results 
to differ materially from those contained in any forward-looking statements. Our
research in clinical efforts may continue for the next several years and we may 
continue to incur losses due to clinical costs incurred in the development of   
Ampligen(R) for commercial application. Possible losses may fluctuate from      
quarter to quarter as a result of differences in the timing of significant      
expenses incurred and receipt of licensing fees and/or cost recovery treatment  
revenues in Europe, Canada and in the United States.                            

 LEGAL PROCEEDINGS

     On September 30, 1998, we filed a multi-count complaint against Manuel P.
Asensio, Asensio & Company, Inc. ("Asensio"). The action included claims of     
defamation, disparagement, tortuous interference with existing and prospective  
business relations and conspiracy, arising out of the Asensio's false and       
defamatory statements. The complaint further alleged that Asensio defamed and   
disparaged us in furtherance of a manipulative, deceptive and unlawful          
short-selling scheme in August and September, 1998. In 1999, Asensio filed an   
answer and counterclaim alleging that in response to Asensio's strong sell      
recommendation and other press releases, we made defamatory statements about    
Asensio. We denied the material allegations of the counterclaim. In July 2000,  
following dismissal in federal court for lack of subject matter jurisdiction, we
transferred the action to the Pennsylvania State Court. In March 2001, the      
defendants responded to the complaints as amended and a trial commenced on      
January 30, 2002. A jury verdict disallowed the claims against the defendants   
for defamation and disparagement and the court granted us a directed verdict on 
the counterclaim. On July 2, 2002 the Court entered an order granting us a new  
trial against Asensio for defamation and disparagement. Thereafter, Asensio     
appealed the granting of a new trial. This appeal is now pending in the Superior
Court of Pennsylvania.                                                          

      In June 2002, a former ME/CFS clinical trial patient and her husband filed
a claim in the Superior Court of New Jersey, Middlesex County, against us, one  
of our clinical trial investigators and others alleging that she was harmed in  
the ME/CFS clinical trial as a result of negligence and breach of warranties. We
believe the claim is without merit and we are defending the claim against us    
through our product liability insurance carrier.                                

   In June 2002, a former ME/CFS clinical trial patient in Belgium filed a
claim in Belgium, against Hemispherx Biopharma Europe, NV/SA, our Belgian       
subsidiary, and one of our clinical trial investigators alleging that she was   
harmed in the Belgium ME/CFS clinical trial as a result of negligence and breach
of warranties. We believe the claim is without merit and we are defending the   
claim against us through our product liability insurance carrier.               

     In July 2002, we filed suit against Federal Insurance Company ("Federal")
seeking (1) a judicial order declaring our rights and the obligations of Federal
under the insurance policy Federal sold to us (2) monetary damage for breach of 
contract resulting from Federal's refusal to fully defend us in connection with 
the Asensio litigation (3) monetary damages to compensate us for Federal's      
breach of its fiduciary duty faith and dealing and (4) monetary damages,        
interest,                                                                       

16

S-3/A
19th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 19th
costs, and attorneys fees to compensate us for Federal's violation of the       
Pennsylvania Bad Faith Statute. On March 31, 2003 we settled our outstanding    
claim with our insurance company relating to reimbursement of expenses in       
connection with our Asensio law suits. The net settlement amount of             
approximately $1,050,000 is recorded as a reduction in General and              
Administrative expenses in our statement of operations for the year ended       
December 31, 2002.                                                              

 In March 2003, the law firm of Schnader, Harrison, Segal & Lewis, LLP
filed a complaint in the Court of Common Pleas of Philadelphia County against us
for alleged legal fees in the sum of $65,051. We believe the claim is without   
merit and we are defending the claim.                                           

 DIVIDEND POLICY

We have not paid any cash dividends since our inception and do not  
anticipate paying cash dividends in the foreseeable future.                     

SELLING STOCKHOLDERS

   We are registering all 7,457,591 shares of common stock covered by this
prospectus on behalf of the selling stockholders named in the table below. We   
issued the shares, the Debentures convertible into shares, and the Warrants     
exercisable for shares to the selling stockholders in private placements. We    
have registered the shares to permit the selling stockholders and their         
respective transferees, assignees or other successors-in-interest that receive  
their shares from a selling stockholder to resell the shares, from time to time,
when they deem appropriate.                                                     

     The table below identifies the selling stockholders and other information
regarding the beneficial ownership of the common stock held by each of the      
selling stockholders. For the Debenture holders (the first two stockholders     
listed below), the second column lists the number of shares of common stock     
beneficially owned by each selling stockholder as of May 16, 2003, based on each
selling stockholder's ownership of Debentures and Warrants, and assumes the     
conversion of all the Debentures and the exercise of all Warrants. Because the  
conversion price of the Debentures and the exercise price of the Warrants are   
subject to adjustment for anti-dilution protection, the interest on the         
Debentures may be paid in cash or common stock, and the value attributed to any 
shares issued to the investors as interest (the "Interest Shares") depends on   
the average closing price of the common stock during the five consecutive       
business days ending on the third business day immediately preceding the        
applicable interest payment date, and the number of repayment shares depends on 
the amount of our consolidated revenues, the numbers listed in the second column
may change. For the other selling stockholders, the second column lists the     
number of shares of common stock beneficially owned by each selling stockholder 
as of May 16, 2003, based on each selling stockholder's ownership of shares of  
common stock, and does not assume the conversion of any of the Debentures, the  
exercise of any Warrants or the payment of any interest on the Debentures in the
form of common stock rather than cash.                                          

17

S-3/A
20th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 20th
The third column lists each selling stockholder's portion, based on 
agreements with us, of the 7,457,591 shares of common stock being offered by    
this prospectus. With regard to the first two selling stockholders, the number  
of shares being offered by this prospectus was determined in accordance with the
terms of the registration rights agreement with them, in which we agreed to     
register the resale of 135% of (x) the number of shares of common stock issuable
upon conversion of the Debentures, plus (y) the number of shares of common stock
issuable upon exercise of the related Warrants, plus (z) an estimate of the     
number of Interest Shares that may be issued to the selling stockholders as     
interest payments on the Debentures (assuming interest is paid exclusively in   
Interest Shares over the full term of the Debentures, rather than in cash). As  
we stated above, the number of shares that will actually be issued may be more  
or less than the 7,457,591 shares being offered by this prospectus.             

      Under the terms of the Debentures and the Warrants, no selling stockholder
who owns Debentures or Warrants may convert such Debentures or exercise its     
Warrants to the extent that the conversion or exercise would cause the selling  
stockholder, together with its affiliates, to beneficially own more than 4.99%  
of the shares of our then outstanding common stock following such conversion or 
exercise. For purposes of making this determination, shares of common stock     
issuable upon conversion of the Debentures which have not been converted and    
upon exercise of the related Warrants which have not been exercised are         
excluded. The number of shares in the second and third columns does not reflect 
this limitation.                                                                

Any selling stockholder may sell all, some or none of its respective
shares in this offering. See "How The Shares May Be Distributed" below.         

                                 Common Stock                       Common Stock
                                Owned Prior      No. of  Shares    Owned After
Selling Stockholder              To Offering      Being Offered     The Offering
--------------------------------------------------------------------------------
Portside Growth &                                                               
Opportunity Fund               2,229,863(1)       3,311,559             --  
--------------------------------------------------------------------------------
Leonardo L.P.                    2,229,863(2)       3,311,559             --    
--------------------------------------------------------------------------------
Interferon Sciences, Inc.          487,028            487,028             --    
--------------------------------------------------------------------------------
Provesan SA                        347,445            347,445             --    
--------------------------------------------------------------------------------

================================================================================

(1)   Represents (a) up to 1,858,219 shares of common stock issuable upon       
     conversion of the Debentures and (b) up to 371,644 shares of common stock
      issuable upon exercise of the Warrants. Ramius Capital Group, LLC ("Ramius
     Capital") is the investment adviser of Portside Growth & Opportunity Fund
      ("Portside") and consequently has voting control and investment discretion
 over securities held by Portside. Ramius Capital disclaims beneficial
     ownership of the shares held by Portside. Peter A. Cohen, Morgan B. Stark
     and Thomas W. Strauss are the sole managing members of C4S& Co., LLC, the
     sole managing member of Ramius Capital. As a result, Messrs. Cohen, Stark
      and Strauss may be considered beneficial owners of any shares deemed to be
  beneficially owned by Ramius Capital. Messrs. Cohen, Stark and Strauss
disclaim beneficial ownership of these securities.                  

18

S-3/A
21st Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 21st
(2)   Represents (a) up to 1,858,219 shares of common stock issuable upon       
     conversion of the Debentures and (b) up to 371,644 shares of common stock
issuable upon exercise of the Warrants. Angelo, Gordon & Co., L.P.  
("Angelo, Gordon") is the sole director of the general partner of   
Leonardo, L.P. ("Leonardo") and consequently has voting control and 
  investment discretion over securities held by Leonardo. Angelo, Gordon
      disclaims beneficial ownership of the shares held by Leonardo. Mr. John M.
     Angelo, the Chief Executive Officer of Angelo, Gordon, and Mr. Michael L.
Gordon, the Chief Operating Officer of Angelo, Gordon, are the sole 
      general partners of AG Partners, L.P., the sole general partner of Angelo,
Gordon. As a result, Messrs. Angelo and Gordon may be considered    
      beneficial owners of any shares deemed to be beneficially owned by Angelo,
    Gordon. Messrs. Angelo and Gordon disclaim beneficial ownership of these
securities.                                                         

      The selling stockholders have not been employed by, held office in, or had
any other material relationship with us or any of our affiliates within the past
three years except as described below.                                          

March 2003 Issuance Of 6% Senior Convertible Debentures Due January 31, 2005.   

On March 12, 2003, We issued an aggregate of $5,426,000 in principal
amount of 6% Senior Convertible Debentures due January 31, 2005 and an aggregate
of 743,288 Warrants to investors in a private placement for aggregate           
anticipated gross proceeds of $4,650,000. The investors include Portside Growth 
& Opportunity Fund and Leonardo, L.P. The Debentures mature on January 31, 2005 
and bear interest at 6% per annum, payable quarterly in cash or, subject to     
satisfaction of certain conditions, common stock. Any shares of common stock    
issued to the investors as payment of interest shall be valued at 95% of the    
average closing price of the common stock during the five consecutive business  
days ending on the third business day immediately preceding the applicable      
interest payment date.                                                          

     The Debentures are convertible at the option of the investors at any time
through January 31, 2005 into shares of our common stock. The conversion price  
under the Debentures is fixed at $1.46 per share, subject to adjustment for     
anti-dilution protection for issuance of common stock or securities convertible 
or exchangeable into common stock at a price less than the conversion price then
in effect.                                                                      

     The investors also received Warrants to acquire at any time through March
12, 2008 an aggregate of 743,288 shares of common stock at a price of $1.68 per 
share. On March 12, 2004, the exercise price of the Warrants will reset to the  
lesser of the exercise price then in effect or a price equal to the average of  
the daily price of the common stock between March 13, 2003 and March 11, 2004   
(but in no event less than $1.176 per share). The exercise price (and the reset 
price) under the Warrants also is subject to similar adjustments for            
anti-dilution protection.                                                       

 We entered into a registration rights agreement with the investors in
connection with the issuance of the Debentures and the Warrants. The            
registration rights agreement requires that we                                  

19

S-3/A
22nd Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 22nd
register the shares of common stock covered by this registration statement. If  
the registration statement is not filed within the time period required by the  
agreement, not declared effective within the time period required by the        
agreement or, after it is declared effective and subject to certain exceptions, 
sales of all shares required to be registered thereon cannot be made pursuant   
thereto, then we will be required to pay to the investors their pro rata share  
of $3,635 for each day any of the above conditions exist with respect to this   
registration statement.                                                         

March 2003 Acquisition of Assets From Interferon Sciences, Inc.                 

  On March 11, 2003, we acquired from Interferon Sciences, Inc. ("ISI"),
ISI's inventory of ALFERON N Injection(R), a pharmaceutical product used for the
treatment of certain types of genital warts, and a limited license for the      
production, manufacture, use, marketing and sale of this product. As partial    
consideration, we issued 487,028 shares of our common stock to ISI Pursuant to  
our agreements with ISI, we have registered the foregoing shares for public sale
in this prospectus.                                                             

 Except for 62,500 of the shares issued to ISI, we have guaranteed the
market value of the shares retained by ISI as of September 11, 2005, the        
termination date, to be $1.59 per share. ISI is permitted to periodically sell  
certain amounts of its shares. If, within 30 days after the termination date,   
holders of the guaranteed shares request that we honor the guarantee, we will be
obligated to reacquire the holders' remaining guaranteed shares and pay the     
holders $1.59 per share. Please see "We have guaranteed the value of a number of
shares issued and to be issued as a result of our acquisition of assets from    
Interferon Sciences. If our share price is not above $1.59 per share 12 or 18   
months after the dates of issuance of the guaranteed shares, our financial      
condition could be adversely affected" in "Risk Factors," above.                

     On March 11, 2003, we also entered into an agreement to purchase from ISI
all of its rights to the product and other assets related to the product        
including, but not limited to, real estate and machinery. For these assets, we  
have agreed to issue to ISI an additional 487,028 shares and to issue 314,465   
shares and 267,296 shares, respectively to The American National Red Cross and  
GP Strategies Corporation, two creditors of ISI. We have guaranteed the market  
value of all but 62,500 of these shares on terms substantially similar to those 
for the initial acquisition of the ISI assets. The termination date for these   
guarantees is 18 months after the date of issuance of the guaranteed shares to  
ISI and GP Strategies, and 12 months after the date of issuance of the          
guaranteed shares to the American National Red Cross. Pursuant to our agreements
with ISI and these two creditors, we have agreed to register the foregoing      
shares for public sale.                                                         

March 2003 Issuance of Our Shares in Exchange for Outstanding Preferred Equity  
Certificates of Our Luxembourg Subsidiary.                                      

On March 13, 2003, we issued 347,445 shares of our common stock to  
Provesan SA, an affiliate of Laboratorios Del Dr. Esteve S.A. ("Esteve"), in    
exchange for 1,000,000 Euros of convertible preferred equity certificates of our
Luxembourg subsidiary, Hemispherx Biopharma                                     

20

S-3/A
23rd Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 23rd
Europe, S.A., owned by Esteve. We agreed to register the shares issued to       
Provesan SA, and we have registered these shares for public sale in this        
prospectus.                                                                     

    Our European subsidiary, Hemispherx Biopharma Europe, S.A. ("Hemispherx,
S.A.") entered into a Sales and Distribution agreement with Esteve, pursuant to 
which Esteve was granted the exclusive right to market Ampligen(R) in Spain,    
Portugal and Andorra for the treatment of Myalgic/Chronic Fatigue Syndrome      
("ME/CFS"). In addition to other terms and other projected payments, Esteve paid
an initial and non-refundable fee of 625,000 Euros (approximately $545,000) to  
Hemispherx S.A. on April 24, 2002. Esteve is to pay a fee of 1,000,000 Euros    
after U.S. Food and Drug Administration approval of Ampligen(R) for the         
treatment of ME/CFS and a fee of 1,000,000 Euros upon Spain's approval of the   
final marketing authorization for using Ampligen(R) for the treatment of ME/CFS.

The agreement runs for the longer of 10 years from the date of first
arms-length sale in the territory, the expiration of the last Hemispherx patent 
exploited by Esteve or the period of regulatory data protection for the product 
in the applicable territory. Esteve is required to purchase certain minimum     
annual amounts of the product. The agreement is terminable by either party if   
the product is withdrawn form the territory for a specified period due to       
serious adverse health or safety reasons; bankruptcy, insolvency or related     
issues of one of the parties; or material breach of the agreement. Hemispherx   
may transform the agreement into a non-exclusive agreement or terminate the     
agreement in the event that Esteve does not meet specified percentages of its   
annual minimum purchase requirements under the agreement. Esteve may terminate  
the agreement in the event that Hemispherx fails to supply the product to the   
territory for a specified period of time or certain clinical trials being       
conducted by Hemispherx are not successful.                                     

 HOW THE SHARES MAY BE DISTRIBUTED

     The shares to be sold in this offering are in the process of being listed
on the American Stock Exchange, subject to official notice of issuance. The     
selling stockholders may sell their shares of common stock from time to time in 
various ways and at various prices. The common stock may be sold in one or more 
transactions at fixed prices, at prevailing market prices at the time of the    
sale, at varying prices determined at the time of sale, or at negotiated prices.
These sales may be effected in transactions that may involve crosses or block   
transactions. Some of the methods by which the selling stockholders may sell the
shares include:                                                                 

   o     on any national securities exchange or quotation service on which
   the securities may be listed or quoted at the time of sale;

o     in the over-the-counter market;                               

    o     in transactions otherwise than on these exchanges or systems or in
the over-the-counter market;                            

    o     through the writing of options, whether such options are listed on
an options exchange or otherwise;                       

      o     ordinary brokerage transactions and transactions in which the broker
solicits purchasers;                                    

21

S-3/A
24th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 24th
o     privately negotiated transactions;                            

     o     block trades in which the broker or dealer will attempt to sell the
          shares as agent but may position and resell a portion of the block
as principal to facilitate the transaction;             

 o     purchases by a broker or dealer as principal and resale by that
         broker or dealer for the selling stockholder's account under this
prospectus;                                             

o     sales under Rule 144 rather than by using this prospectus;    

o     through the settlement of short sales;                        

o     a combination of any of these methods of sale; or             

o     any other legally permitted method.                           

  In connection with sales of the common stock or otherwise, the selling
stockholders may enter into hedging transactions with broker-dealers, which may 
in turn engage in short sales of the common stock in the course of hedging in   
positions they assume. The selling stockholders may also sell shares of common  
stock short and deliver shares of common stock to close out short positions,    
provided that the selling stockholders may not close out short positions entered
into prior to the effective date of the registration statement of which this    
prospectus is a part with any shares of common stock included in this           
prospectus. The selling stockholders may also pledge their shares as collateral 
for a margin loan under their customer agreements with their brokers. If there  
is a default by the selling stockholders, the brokers may offer and sell the    
pledged shares from time to time under this prospectus or an amendment to this  
prospectus under Rule 424(b)(3) or other applicable provisions of the Securities
Act amending the list of selling stockholders to include the pledgee, transferee
or other successors in interest as selling stockholders under this prospectus.  

    Brokers or dealers may receive commissions or discounts from the selling
stockholders (or, if the broker-dealer acts as agent for the purchaser of the   
shares, from that purchaser) in amounts to be negotiated. These commissions may 
exceed those customary in the types of transactions involved.                   

We cannot estimate at the present time the amount of commissions or 
discounts, if any, that will be paid by the selling stockholders in connection  
with sales of the shares.                                                       

      The selling stockholders and any broker-dealers or agents that participate
with the selling stockholders in sales of the shares may be deemed to be        
"underwriters" within the meaning of the Securities Act in connection with such 
sales. In that event, any commissions received by the broker-dealers or agents  
and any profit on the resale of the shares purchased by them may be deemed to be
underwriting commissions or discounts under the Securities Act. The selling     
stockholders have advised us that they have not entered into any agreements,    
understandings or arrangements with any underwriters or broker-dealers regarding
the sale of the shares of common stock. There is no underwriter or coordinating 
broker acting in connection with the proposed sale of shares by the selling     
stockholders. In addition, each of the investors has advised us that:           

 o     it purchased the shares in the ordinary course of business; and

22

S-3/A
25th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 25th
   o     at the time of the purchase of the shares to be resold, it had no
      agreements or understandings, directly or indirectly, with any
person to distribute the shares.                        

  Under the securities laws of certain states, the shares may be sold in
those states only through registered or licensed broker-dealers. In addition,   
the shares may not be sold unless the shares have been registered or qualified  
for sale in the relevant state or unless the shares qualify for an exemption    
from registration or qualification.                                             

      We do not know whether any selling stockholder will sell any or all of the
shares of common stock registered by the shelf registration statement of which  
this prospectus forms a part.                                                   

    We have agreed to pay all fees and expenses incident to the registration
of the shares, including certain fees and disbursements of counsel to the       
selling stockholders. We have agreed to indemnify the selling stockholders      
against certain losses, claims, damages and liabilities, including liabilities  
under the Securities Act.                                                       

     Certain of the selling stockholders have also agreed to indemnify us, our
directors, officers, agents and representatives against certain liabilities,    
including certain liabilities under the Securities Act.                         

The selling stockholders and other persons participating in the     
distribution of the shares offered under this prospectus are subject to the     
applicable requirements of Regulation M promulgated under the Exchange Act in   
connection with sales of the shares.                                            

 We have agreed with the selling stockholders to keep the registration
statement of which this prospectus is a part effective until all the shares     
registered under the registration statement have been resold.                   

 USE OF PROCEEDS

     Proceeds from stockholders exercising some or all of the Warrants will be
used to fund our research and development efforts and possible acquisitions.    

 WHERE YOU CAN FIND MORE INFORMATION

     We file annual, quarterly and special reports, proxy statements and other
information with the Securities and Exchange Commission. You may read and copy  
any document we file at the Securities and Exchange Commission's public         
reference rooms at 450 Fifth Street, N.W., Washington, D.C. 20549. Please call  
the Securities and Exchange Commission at 1-800-SEC-0330 for further information
on the public reference rooms. Many of our Securities and Exchange Commission   
filings are also available to the public from the Securities and Exchange       
Commission's Website at "http://www.sec.gov."                                   

23

S-3/A
26th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 26th
    We have filed with the Securities and Exchange Commission a registration
statement (which contains this prospectus) on Form S-3 under the Securities Act 
of 1933. The registration statement relates to the securities offered by the    
selling stockholders. This prospectus does not contain all of the information   
set forth in the registration statement and the exhibits and schedules to the   
registration statement. Please refer to the registration statement and its      
exhibits and schedules for further information with respect to us, the common   
stock and the Warrants. Statements contained in this prospectus as to the       
contents of any contract or other document are not necessarily complete and, in 
each instance, we refer you to the copy of that contract or document filed as an
exhibit to the Registration Statement. You may read and obtain a copy of the    
registration statement and its exhibits and schedules from the SEC, as described
in the preceding paragraph.                                                     

 INFORMATION INCORPORATED BY REFERENCE

  The Commission allows us to "incorporate by reference" the 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 considered to be part of this prospectus, and later information    
that we file with the Commission will automatically update and supercede this   
information. We incorporate by reference the following documents and any future 
filing made with the Commission under Sections 13(a), 14 or 15(d) of the        
Securities Exchange Act of 1934 until we and the selling stockholders sell all  
the securities included in this prospectus:                                     

(a)   Our amended annual report on Form 10-K for our fiscal year ended December 
31, 2002, File No. 0-27072.                                         

(b)   Our quarterly report on Form 10-Q for the quarterly period ended March 31,
2003.                                                               

(c)   Our current report on Form 8-K filed on March 13, 2003, File No. 0-27072. 

(d)   Our proxy statement on schedule 14A for our 2002 annual meeting, File No. 
0-27072.                                                            

(e)   A description of our common stock contained in our registration statement 
     on Form S-1, File No. 33-93314, and any amendment or report filed for the
     purpose of updating this description filed subsequent to the date of this
prospectus and prior to the termination of this offering.           

You may request a copy of these filings, at no cost, by writing or  
telephoning us at the following address: Hemispherx Biopharma, Inc., 1617 JFK   
Boulevard, Philadelphia, Pennsylvania 19103, telephone number 215-988-0080.     

You should rely only on the information incorporated by reference or
provided in this prospectus or any supplement. We have not authorized anyone    
else to provide you with different information. We and the selling stockholders 
will not make offers to these shares in any state                               

24

S-3/A
27th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 27th
where the offer is not permitted. You should not assume that the information in 
this prospectus or any supplement is accurate as of any date other that the date
on the front of those documents.                                                

 DESCRIPTION OF SECURITIES

     The following section does not purport to be complete and is qualified in
all respects by reference to the detailed provisions of our certificate of      
incorporation and by-laws, as amended, copies of which have been filed with the 
Securities and Exchange Commission.                                             

    Our authorized capital stock consist of: (i) 50,000,000 shares of common
stock, $.001 par value; and (ii) 5,000,000 shares of preferred stock, .01 par   
value. 33,633,459 shares of common stock were issued and outstanding as of the  
date of this prospectus. As of this date, there were approximately 259 record   
holders of our common stock not including holders in street name. We estimate   
that there are some 3,300 holders if you include shares held in street name.    

Common Stock                                                                    

    Shares of our common stock are entitled to one vote per share, either in
person or by proxy, on all matters that may be voted upon by the owners of our  
shares at meetings of our stockholders. There is no provision for cumulative    
voting with respect to the election of directors by the holders of common stock.
Therefore, the holder of more than 50% of our shares of outstanding common stock
can, if they choose to do so, elect all of our directors. In this event, the    
holders of the remaining shares of common stock will not be able to elect any   
directors.                                                                      

The holders of common stock:                                        

o     have equal rights to dividends from funds legally available   
  therefore, when and if declared by our board of directors;

  o     are entitled to share ratably in all of our assets available for
 distribution to holders of common stock upon liquidation,
dissolution or winding up of our affairs; and           

    o     do not have preemptive rights, conversion rights, or redemption of
sinking fund provisions.                                

   The outstanding shares of our common stock are duly authorized, validly
issued, fully paid and nonassessable.                                           

25

S-3/A
28th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 28th
Preferred Stock.                                                                

      Under our certificate of incorporation, as amended, our board of directors
is authorized, subject to certain limitations prescribed by law, without further
stockholder approval, from time to time to issue up to an aggregate of 5,000,000
shares of preferred stock. At this time, there are no preferred shares          
outstanding.                                                                    

TRANSFER AGENT AND REGISTRAR

 The transfer agent and registrar for our common stock and warrants is
Continental Stock Transfer and Trust Co., 17 Battery Place, 8th Floor, New York,
New York 10004.                                                                 

 LEGAL MATTERS

The validity of the common stock offered in this prospectus has been
passed upon for us by Silverman Sclar Byrne Shin & Byrne P.C., 381 Park Avenue  
South, Suite 1601, New York, New York 10016.                                    

 EXPERTS

The consolidated financial statements incorporated by reference in this         
prospectus have been audited by BDO Seidman, LLP, independent certified public  
accountants, to the extent and for the periods set forth in the report of such  
firm incorporated herein by reference and, are incorporated herein in reliance  
upon such report given upon the authority of such firm as experts in auditing   
and accounting.                                                                 

DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION
FOR SECURITIES ACT LIABILITIES

   Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to our directors, officers, and controlling persons, we    
have been advised that in the opinion of the Commission this indemnification is 
against public policy as expressed in the Securities Act and is, therefore      
unenforceable. In the event that a claim for indemnification against these      
liabilities, other than our payment of expense incurred or paid by one of our   
directors, officers, or controlling persons in the successful defense of any    
action, suit or proceeding, is asserted by that director, officer or controlling
person in connection with the securities being registered, we will, unless in   
the opinion of our counsel the matter has been settled by a controlling         
precedent, submit to a court of appropriate jurisdiction the question whether   
this indemnification by us is against public policy as expressed in the         
Securities Act and will be governed by the final adjudication of these issues.  

26

S-3/A
29th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 29th
================================================================================

No dealer, salesman or any other person is authorized to give any information or
to represent anything not contained in this prospectus. You must not rely on any
unauthorized information or representations. This prospectus is an offer to sell
these securities and it is not a solicitation of an offer to buy these          
securities in any state where the offer or sale is not permitted. The           
information contained in this Prospectus is current only as of this date.       

 TABLE OF CONTENTS

                                                                            Page
Prospectus Summary ........................................................    2
About Hemispherx ..........................................................    2
Risk Factors ..............................................................    3
Legal Proceedings .........................................................   16
Dividend Policy ...........................................................   17
Selling Stockholders ......................................................   17
How the Shares May Be Distributed .........................................   21
Use of Proceeds ...........................................................   23
Where you can find More information .......................................   23
Information Incorporated By Reference .....................................   24
Description of Securities .................................................   25
Transfer Agent ............................................................   26
Legal Matters .............................................................   26
Experts ...................................................................   26
Disclosure of the Commissions Position ....................................   26

--------------------------------------------------------------------------------

================================================================================

 7,457,591 SHARES OF
COMMON STOCK

HEMISPHERX BIOPHARMA, INC.

----------

PROSPECTUS

----------

 May ___, 2003

================================================================================

S-3/A
30th Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 30th
 PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.                           

SEC Filing Fees ............................................          $   925.00
American Stock Exchange Listing Fee* .......................          $17,500.00
Printing and Engraving Expenses* ...........................          $ 2,500.00
Accounting Fees and Expenses* ..............................          $10,000.00
Legal Fees and Expenses* ...................................          $12,500.00
Transfer Agent and Registrar Fees* .........................          $ 1,500.00
Miscellaneous* .............................................          $ 3,075.00

Total Expenses* ............................................          $48,000.00

----------                                                                      
* Estimated.                                                                    

ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.                             

Our Amended and Restated Certificate of Incorporation limits the liability of   
directors to the maximum extent permitted by Delaware law. Delaware law provides
that directors of a corporation will not be personally liable for monetary      
damages for breach of their fiduciary duties as directors, except for liability 
for (i) any breach of their duty of loyalty to the corporation or its           
stockholders, (ii) acts or omissions not in good faith or that involve          
intentional misconduct or a knowing violation of law, (iii) unlawful payments of
dividends or unlawful stock repurchases or redemptions as provided in Section   
174 of the Delaware General Corporation Law or (iv) any transaction from which  
the director derives an improper personal benefit.                              

ITEM 16. EXHIBITS.                                                              

Exhibit No. Description                                                         

     2.1   First Asset Purchase Agreement dated March 11, 2003, by and between
the Company and ISI.*                                   

      2.2   Second Asset Purchase Agreement dated March 11, 2003, by and between
the Company and ISI.*                                   

    5.1   Opinion of Silverman Sclar Byrne Shin & Byrne P.C., legal counsel.

     10.1  Forbearance Agreement dated March 11, 2003, by and between ISI, the
American National Red Cross and the Company.*           

    10.2  Forbearance Agreement dated March 11, 2003, by and between ISI, GP
Strategies Corporation and the Company.*                

II-1

S-3/A
31st Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 31st
   10.3  Securities Purchase Agreement, dated March 12, 2003, by and among
the Company and the Buyers named therein.*              

10.4  Form of 6% Convertible Debenture of the Company.*             

10.5  Form of Warrant for Common Stock of the Company.*             

   10.6  Registration Rights Agreement, dated March 12, 2003, by and among
the Company and the Buyers named therein.*              

23.1  Consent of BDO Seidman, LLP, independent certified public     
accountants.                                            

   23.2  Consent of Silverman Sclar Byrne Shin & Byrne P.C., legal counsel
(included in Exhibit 5.1).                              

      24.1  Powers of Attorney (included in Signature Pages to this Registration
Statement on Form S-3).**                               

----------                                                                      
*    Incorporated by reference from the exhibits to the Company's Current     
Report on Form 8-K filed on March 13, 2003.                         

**    Previously filed.                                                         

ITEM 17. UNDERTAKINGS                                                           

(a) Insofar as indemnification for liabilities arising under the Securities Act 
of 1933 (the "Securities Act") may be permitted to directors, officers and      
controlling persons of the registrant pursuant to the foregoing provisions, or  
otherwise, the registrant has been advised that in the opinion of the Commission
such indemnification is against public policy as expressed in the Securities Act
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 question whether such indemnification by it is against public  
policy as expressed in the Securities Act and will be governed by the final     
adjudication of such issue.                                                     

(b) The undersigned registrant hereby undertakes that for purposes of           
determining any liability under the Securities Act, each filing of the          
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the    
Exchange Act (and, where applicable, each filing of an employee benefit plan's  
annual report pursuant to Section 15(d) of the Exchange Act) 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.                                                          

(c) We, the undersigned Registrant hereby undertake:                            

(1) To file, during any period in which offers or sales are being made, a       
post-effective amendment to the Registrant Statement to:                        

(i) Include any prospectus required by Section 10(a)(3) of the Securities Act of
1933;                                                                           

II-2

S-3/A
32nd Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 32nd
(ii) Reflect in the prospectus any facts or events arising after the effective  
date of the Registration Statement (or the most recent post-effective amendment 
thereof) that individually or in the aggregate represent a fundamental change in
the information set forth in the Registration Statement; and                    

(iii) 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;                                 

provided, however, that paragraphs (i) and (ii) do not apply if the information 
required to be included in a post-effective amendment by those paragraphs is    
contained in periodic reports filed with or furnished to the Commission by the  
Registrant pursuant to Section 13 or 15(d) of the Securities Exchange Act of    
1934 that are incorporated by reference 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.                                                          

(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.                                                                       

II-3

S-3/A
33rd Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 33rd
SIGNATURES

Pursuant to the requirement of the Securities Act of 1933, this 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 Amendment No. 1 to 
the Registration Statement to be signed on its behalf by the undersigned,       
thereunto duly authorized in the City of Philadelphia, Commonwealth of          
Pennsylvania, on the 20th day of May, 2003.                                     

HEMISPHERX BIOPHARMA, INC.                                                      
(Registrant)                                                                    

By: /s/ William A. Carter                                                       
------------------------                                                
William A. Carter, M.D.,                                                
Chief Executive Officer                                                 

Pursuant to the requirements of the Securities Act of 1933, this Amendment No. 1
to the Registration Statement has been signed by the following persons in the   
capacities indicated on the dates indicated.                                    

                                                        [Enlarge/Download Table]

Signature                             Title                                            Date    
---------                             -----                                            ----    
                                                                                               
/s/ William A. Carter              Chairman of the Board, Chief Executive Officer  May 20, 2003
-------------------------------    (Principal Executive) and Director                          
William A. Carter, M.D.                                                                        

            *                      Director                                        May 20, 2003
Richard Piani                                                                                  

            *                      Chief Financial Officer and                     May 20, 2003
Robert E. Peterson                 Chief Accounting Officer                                    

            *                      Secretary And Director                          May 20, 2003
Ransom Etheridge                                                                               

            *                      Director                                        May 20, 2003
William Mitchell, M.D., Ph.D.                                                                  

Iraj-Eqhbal Kiani, M.D.            Director                                        May 20, 2003

  * By:  /s/ William A. Carter                                                                 
         -----------------------                                                               
         William A. Carter, M.D.,                                                              
         Attorney-in-Fact                                                                      


  II-4

S-3/A
Last Page of 34
TOC
1st
Previous
Next
↓Bottom
Just 34th
Hemispherx Biopharma, Inc.                                                      
Form S-3                                                                        
Index to Exhibits                                                               

Exhibit No. Description                                                         

5.1   Opinion of Silverman Sclar Byrne Shin & Byrne P.C., legal counsel.        

23.1  Consent of BDO Seidman, LLP, independent certified public accountants.    

23.3  Consent of Silverman Sclar Byrne Shin & Byrne PC, legal counsel (included 
in Exhibit 5.1).                                                    

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘S-3/A’ Filing		Date		First		Last			Other Filings
		11/19/12		17
		3/12/08		21					5
		9/11/05		22
		1/31/05		21
		3/12/04		21					10-K,  4
		3/11/04		21
Filed on:		5/21/03		1		3
		5/20/03		33					10-K/A,  10-Q
		5/16/03		3		19
		5/1/03		7		16
		3/31/03		6		26			8-K/A,  NT 10-Q
		3/27/03		2
		3/13/03		21		31			8-K
		3/12/03		2		31			4,  8-K
		3/11/03		22		30			4
		12/31/02		16		26			10-K,  10-K/A,  DEF 14A,  NT 10-K,  PRE 14A
		11/29/02		17
		7/2/02		18
		4/24/02		23
		1/30/02		18
		9/30/98		18					10-Q,  10-Q/A
									List all Filings