Filed Pursuant to Rule 424(b)(3) and (c)
File No. 333-53678
PROSPECTUS SUPPLEMENT NO. 1
INHALE THERAPEUTIC SYSTEMS, INC.
$230,000,000
OF
3.5% CONVERTIBLE SUBORDINATED NOTES
DUE OCTOBER 17, 2007
AND
4,558,065 SHARES OF COMMON STOCK
ISSUABLE UPON CONVERSION OF THE NOTES
This prospectus supplement supplements the prospectus dated February 2,
2001 of Inhale Therapeutic Systems, Inc. relating to the public offering and
sale by selling security holders described below. This prospectus supplement
contains information on ownership of principal amount of notes beneficially
owned and offered and shares of our common stock issuable upon conversion of the
notes. This prospectus supplement should be read in conjunction with the
prospectus, and this prospectus supplement is qualified by reference to the
prospectus, except to the extent that the information provided by this
prospectus supplement supersedes the information contained in the prospectus.
SEE "RISK FACTORS" BEGINNING ON PAGE 5 OF THE PROSPECTUS TO READ ABOUT
FACTORS YOU SHOULD CONSIDER BEFORE BUYING THE NOTES OR OUR COMMON STOCK.
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Neither the Securities and Exchange Commission nor any other regulatory
body has approved or disapproved of these securities or passed upon the adequacy
or accuracy of this prospectus. Any representation to the contrary is a criminal
offense.
The table and related notes, and the paragraphs immediately following the table
and related notes, appearing in the prospectus under the heading "Selling
Security Holders" is amended by the addition of the following table and related
notes, and the following paragraph immediately following the table and related
notes:
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NAME PRINCIPAL AMOUNT OF COMMON STOCK COMMON COMMON STOCK OWNED
NOTES BENEFICIALLY ISSUABLE UPON STOCK AFTER COMPLETION
OWNED AND OFFERED CONVERSION OF OFFERED OF THE OFFERING
(1)(2) THE NOTES (2)
---------------------------------------------- --------------------- ------------------ ------------ --------------------
Allstate Life Insurance Company 200,000 3,963 3,963 --
---------------------------------------------- --------------------- ------------------ ------------ --------------------
City of New Orleans 174,000 3,448 3,448 --
---------------------------------------------- --------------------- ------------------ ------------ --------------------
JMG Capital Partners, LP 2,000,000 39,635 39,635 --
---------------------------------------------- --------------------- ------------------ ------------ --------------------
JMG Triton Offshore Fund, Ltd. 6,500,000 128,814 128,814 --
---------------------------------------------- --------------------- ------------------ ------------ --------------------
KBC Financial Products USA 2,500,000 49,544 49,544 --
---------------------------------------------- --------------------- ------------------ ------------ --------------------
Merrill Lynch Pierce Fenner & Smith Inc. 5,690,000 112,762 112,762 --
---------------------------------------------- --------------------- ------------------ ------------ --------------------
Onyx Fund Holding, LDC 3,000,000 59,453 59,453 --
---------------------------------------------- --------------------- ------------------ ------------ --------------------
Pro Mutual 651,000 12,901 12,901 --
---------------------------------------------- --------------------- ------------------ ------------ --------------------
Raytheon Master Pension Trust 470,000 9,314 9,314 --
---------------------------------------------- --------------------- ------------------ ------------ --------------------
Shell Pension Trust 376,000 7,451 7,451 --
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(1) Amounts indicated may be in excess of the total amount registered due to
sales or transfers exempt from the registration requirements of the
Securities Act since the date upon which the selling holders provided to
us in the information regarding their notes.
(2) Amounts listed include additional amounts now being registered by the
selling holder for notes beneficially owned and offered and common stock
issuable upon conversion of the notes that were already included in the
prospectus dated February 2, 2001.
Additional information regarding selling holders will be provided by
amendment or supplement to this prospectus.
With the exception of Merrill Lynch Pierce Fenner & Smith Inc. and Deutsche
Bank Securities Inc., none of the selling holders nor any of their affiliates,
officers, directors or principal equity holders has held any position or office
or has had any material relationship with us within the past three years,
although the selling holders may hold additional securities of Inhale. Merrill
Lynch Pierce Fenner & Smith Inc. and Deutsche Bank Securities Inc. were initial
purchasers of the notes. The selling holders purchased the notes in private
transactions on or after October 27, 2000. All of the notes were "restricted
securities" under the Securities Act prior to this registration.
Information concerning the selling holders may change from time to time and
any changed information will be set forth in supplements to this prospectus if
and when necessary. In addition, the conversion rate and therefore, the number
of shares of common stock issuable upon conversion of the notes, is subject to
adjustment under certain circumstances. Accordingly, the aggregate principal
amount of notes and the number of shares of common stock into which the notes
are convertible may increase or decrease.
The date of this prospectus supplement is March 16, 2001.