~~---------------------------------------------------------------------------------------------------------~~SECURITIES ~~Pro~~AND ~~Forma~~EXCHANGE ~~Condensed~~COMMISSION Consolidated Balance Sheet Previously Pro Forma Pro Forma June 30, 2001 Reported Adjustments Balance --------------------------------------------------------------------------------------------------------- ASSETS --------------------------------------------------------------------------------------------------------- Current assets: --------------------------------------------------------------------------------------------------------- Cash and cash equivalents (1) 6,065,000 3,442,000 9,507,000 --------------------------------------------------------------------------------------------------------- Trade receivables, net (2) 4,194,000 (4,194,000) -- --------------------------------------------------------------------------------------------------------- Receivables from related party (3) 1,613,000 (1,613,000) -- --------------------------------------------------------------------------------------------------------- Inventory (4) 3,110,000 (3,110,000) -- --------------------------------------------------------------------------------------------------------- Short term marketable securities 2,057,000 2,057,000 --------------------------------------------------------------------------------------------------------- Other current assets (5) 4,360,000 (1,683,000) 2,677,000 --------------------------------------------------------------------------------------------------------- Total current assets 21,399,000 (7,158,000) 14,241,000 --------------------------------------------------------------------------------------------------------- Fixed assets, net (6) 6,959,000 (3,453,000) 3,506,000 --------------------------------------------------------------------------------------------------------- Intangible assets, net (7) 37,385,000 (2,676,000) 34,709,000 --------------------------------------------------------------------------------------------------------- Other assets 1,000,000 1,000,000 --------------------------------------------------------------------------------------------------------- Total assets 66,743,000 (13,287,000) 53,456,000 --------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------- LIABILITIES --------------------------------------------------------------------------------------------------------- Current liabilities: --------------------------------------------------------------------------------------------------------- Accounts payable (8) 3,062,000 (1,405,000) 1,657,000 --------------------------------------------------------------------------------------------------------- Accounts payable due to related party (9) 4,031,000 (4,031,000) -- --------------------------------------------------------------------------------------------------------- Accrued expenses (10) 3,384,000 (814,000) 2,570,000 --------------------------------------------------------------------------------------------------------- Capital leases - current portion (11) 677,000 (677,000) -- --------------------------------------------------------------------------------------------------------- Deferred revenue - current portion 450,000 450,000 --------------------------------------------------------------------------------------------------------- Total current liabilities 11,604,000 (6,927,000) 4,677,000 --------------------------------------------------------------------------------------------------------- Capital lease obligation - non current portion (11) 1,563,000 (1,563,000) -- --------------------------------------------------------------------------------------------------------- Deferred revenue - non current portion 1,350,000 1,350,000 --------------------------------------------------------------------------------------------------------- Total liabilities 14,517,000 (8,490,000) 6,027,000 --------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------- SHAREHOLDERS' EQUITY --------------------------------------------------------------------------------------------------------- Convertible preferred stock; $.001 par value, ---------------------------------------------------------------------------------------------------------

--------------------------------------------------------------------------------------------------------- Pro Forma Condensed Consolidated Statement of Operations For the Year Ended Previously Pro Forma Pro Forma Balance December 31Washington, ~~2000~~D. ~~Reported~~C. ~~Adjustments~~20549 --------------------------------------------------------------------------------------------------------- Revenue (13) 18,180,000 (17,366,000) 814,000 --------------------------------------------------------------------------------------------------------- Cost of goods sold (14) 11,429,000 (11,429,000) -- --------------------------------------------------------------------------------------------------------- Gross profit 6,751,000 (5,937,000) 814,000 --------------------------------------------------------------------------------------------------------- Operating expenses: --------------------------------------------------------------------------------------------------------- Research and development (15) 10,828,000 (7,498,000) 3,330,000 --------------------------------------------------------------------------------------------------------- General and administrative (15) 10,988,000 (7,832,000) 3,156,000 --------------------------------------------------------------------------------------------------------- Selling, marketing and distribution (16) 9,923,000 (9,923,000) -- --------------------------------------------------------------------------------------------------------- Goodwill and intangible asset amortization (17) 4,067,000 (233,000) 3,834,000 --------------------------------------------------------------------------------------------------------- Depreciation (18) 3,437,000 (574,000) 2,863,000 --------------------------------------------------------------------------------------------------------- Total operating expenses 39,243,000 (26,060,000) 13,183,000 --------------------------------------------------------------------------------------------------------- Operating loss (32,492,000) 20,123,000 (12,369,000) --------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------- Other (income) expenses: --------------------------------------------------------------------------------------------------------- Royalty, licensing and other related income 100,000 100,000 --------------------------------------------------------------------------------------------------------- Royalty expense (78,000) (78,000) --------------------------------------------------------------------------------------------------------- Gain on sale of equity investment (3,231,000) (3,231,000) --------------------------------------------------------------------------------------------------------- Interest income (19) (1,217,000) (322,000) (1,539,000) --------------------------------------------------------------------------------------------------------- Interest expense (20) 8,000 (8,000) -- --------------------------------------------------------------------------------------------------------- Other, net (21) 21,000 322,000 343,000 --------------------------------------------------------------------------------------------------------- Total other (income) expense (4,397,000) (8,000) (4,405,000) --------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------- Net loss (28,095,000) 20,131,000 (7,964,000) --------------------------------------------------------------------------------------------------------- Preferred stock dividends (6,371,000) (6,371,000) --------------------------------------------------------------------------------------------------------- Net loss applicable to ---------------------------------------------------------------------------------------------------------

~~---------------------------------------------------------------------------------------------------------~~FORM Pro Forma Condensed Consolidated Statement of Operations For the Six Months Ended Previously Pro Forma Pro Forma Balance June 30, 2001 Reported Adjustments --------------------------------------------------------------------------------------------------------- Revenue (13) 9,768,000 (9,348,000) 420,000 --------------------------------------------------------------------------------------------------------- Cost of goods sold (14) 5,452,000 (5,452,000) -- --------------------------------------------------------------------------------------------------------- Gross profit 4,316,000 (3,896,000) 420,000 --------------------------------------------------------------------------------------------------------- Operating expenses: --------------------------------------------------------------------------------------------------------- Research and development (15) 3,755,000 (2,045,000) 1,710,000 --------------------------------------------------------------------------------------------------------- General and administrative (15) 2,777,000 (1,199,000) 1,578,000 --------------------------------------------------------------------------------------------------------- Selling, marketing and distribution (16) 5,010,000 (5,010,000) -- --------------------------------------------------------------------------------------------------------- Goodwill and intangible asset amortization (17) 2,033,000 (116,000) 1,917,000 --------------------------------------------------------------------------------------------------------- Depreciation (18) 1,630,000 (483,000) 1,147,000 --------------------------------------------------------------------------------------------------------- Total operating expenses 15,205,000 (8~~,853,000) 6,352,000~~ -~~--------------------------------------------------------------------------------------------------------~~K Operating loss (10,889,000) 4,957,000 (5,932,000) --------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------- Other (income) expenses: --------------------------------------------------------------------------------------------------------- Interest income (19) (292,000) (37,000) (329,000) --------------------------------------------------------------------------------------------------------- Interest expense (20) 137,000 (137,000) -- --------------------------------------------------------------------------------------------------------- Other, net (21) 63,000 363,000 426,000 --------------------------------------------------------------------------------------------------------- Total other (income) expense (92,000) 189,000 97,000 --------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------- Net loss (10,797,000) 4,768,000 (6,029,000) --------------------------------------------------------------------------------------------------------- Preferred stock dividends (3,295,000) (3,295,000) --------------------------------------------------------------------------------------------------------- Net loss applicable to common stock (14,092,000) 4,768,000 (9,324,000) --------------------------------------------------------------------------------------------------------- Basic and diluted loss per share (0.69) 0.23 (0.46) --------------------------------------------------------------------------------------------------------- Weighted average number of shares of common stock outstanding - basic and diluted 20,450,000 20,450,000 20,450,000 --------------------------------------------------------------------------------------------------------- ---------------------------------------------------------------------------------------------------------

~~----------------------------------------------------------------------------------------------------------------~~CURRENT ~~Description~~REPORT Amount ---------------------------------------------------------------------------------------------------------------- Write-off of intangibles, principally amounts allocated to work force, impaired as a result of the transaction 2,676,000 ---------------------------------------------------------------------------------------------------------------- Write-off of otherwise saleable inventory not purchased by Baxter and not marketable by the Company under terms of the agreements 766,000 ---------------------------------------------------------------------------------------------------------------- Foreign currency translation adjustments included as a component of accumulated other comprehensive income 605,000 ---------------------------------------------------------------------------------------------------------------- Estimated direct transaction costs 500,000 ---------------------------------------------------------------------------------------------------------------- Severance and related payments 605,000 ---------------------------------------------------------------------------------------------------------------- Other 250,000 ---------------------------------------------------------------------------------------------------------------- Total 5,402,000 ---------------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------------

~~Exhibit~~Pursuant Method of No Description Filing ------- ----------- --------- 2.7 Asset Purchase Agreement dated as of August 3, 2001 among the Filed herewith Registrant, Nexell California and Baxter (schedules are electronically omitted from this agreement and the other agreements filed herewith, and the Registrant agrees to ~~furnish~~Section ~~supplementally~~13 aor ~~copy of any schedule to the Commission upon request~~15(d). ~~10.89 Distribution and License Agreement dated August 31, 2001 Filed herewith between Baxter and Nexell California. electronically 10.90 Sublicense Agreement~~ of the First BD Sublicense dated August Filed herewith 31, 2001 between Baxter and Nexell California. electronically 10.91 Sublicense Agreement of the Second BD Sublicense dated August Filed herewith 31, 2001 between Baxter and Nexell California. electronically 10.92 Sublicense Agreement of the Dorken Sublicense dated August Filed herewith 31, 2001 between Baxter and Nexell California. electronically 10.93 Sublicense Agreement of the Public Health Service Biological Filed herewith Materials License dated August 31, 2001 between Baxter and electronically Nexell California. 10.94 Sublicense Agreement of the Diaclone Monoclonal Antibody Filed herewith License dated August 31, 2001 between Baxter and Nexell electronically California. 10.95 Employee Lease Agreement dated August 31, 2001 among Baxter, Filed herewith the Registrant and Nexell California. electronically 10.96 Supply Agreement dated August 31, 2001 between Baxter and Filed herewith Nexell California. electronically 99.1 Press Release of the Registrant dated September 5, 2001. Filed herewith electronically

the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 14, 2002

NEXELL THERAPEUTICS INC.

(Exact name of registrant as specified in its charter)

Delaware

(State or other jurisdiction of incorporation)

0-19153		06-1192468

(Commission File Number)		(I.R.S. Employer Identification No.)

9 Parker, Irvine, California		92618-1605

(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (949) 470-9011

(NOT APPLICABLE)

(Former name or former address, if changed since last report)

Item 7. Financial Statements and Exhibits.

The following exhibits are filed as a part of this report:

Exhibit No
99.1		Certification of Chief Executive Officer and Chief Financial Officer.

Item 9. Regulation FD Disclosure.

In accordance with 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (the “Act”), William A. Albright, Jr., Chief Executive Officer and Chief Financial Officer of Nexell Therapeutics Inc., submitted his certification required by the Act to the Securities and Exchange Commission on August 14, 2002. A copy of such certification is attached hereto as Exhibit 99.1.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	NEXELL THERAPEUTICS INC.

Date: August 14, 2002	By:	/s/ WILLIAM A. ALBRIGHT, JR.
		William A. Albright, Jr. Chief Executive Officer and Chief Financial Officer

EXHIBIT INDEX

Exhibit No
99.1		Certification of Chief Executive Officer and Chief Financial Officer		Filed herewith.

Filing Compare · NEXELL THERAPEUTICS INC