##### Table of Contents



UNITED
STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 FORM 10-Q
 
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2008
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 Commission file number 000-33393
 Northwest Biotherapeutics, Inc.
 (Exact Name of Registrant as Specified in its Charter)
 Delaware
    
    I.R.S. Employer Identification No. 94-3306718(State or other Jurisdiction of Incorporation or Organization)
 7600 Wisconsin Avenue, Suite 750
Bethesda, Maryland 20814
 (240) 497-9024
 þ o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company þ(do not check if a smaller reporting company)
 o þ




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##### 



TABLE OF CONTENTS
 NORTHWEST BIOTHERAPEUTICS, INC.
 TABLE OF CONTENTS
 PagePART I  FINANCIAL INFORMATIONItem 1. Financial StatementsCondensed Consolidated Balance Sheets as of December 31, 2007 and March 31, 2008 (unaudited)
    
    
    3Condensed Consolidated Statements of Operations (unaudited) for the three months ended
March 31, 2007 and 2008 and the period from March 18, 1996 (inception) to March 31, 2008
    
    
    4Condensed Consolidated Statements of Cash Flows (unaudited) for the three months ended
March 31, 2007 and 2008 and the period from March 18, 1996 (inception) to March 31, 2008
    
    
    5Notes to Condensed Consolidated Financial Statements
    
    
    7Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    16Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    23Item 4. Controls and Procedures
    
    
    23PART II  OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    26Item 1A. Risk Factors
    
    
    27Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    38Item 3. Defaults Upon Senior Securities
    
    
    38Item 4. Submission of Matters to a Vote of Security Holders
    
    
    38Item 5. Other Information
    
    
    38Item 6. Exhibits
    
    
    38SIGNATURES
    
    
    39INDEX TO EXHIBITS
    
    
    40Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2
   2




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##### Table of Contents



Part I  Financial Information
 NORTHWEST BIOTHERAPEUTICS, INC.
 
 Condensed Consolidated Balance Sheets
 December 31,
    
    
    March 31,2007
    
    
    2008(Unaudited)AssetsCurrent assets:Cash
    
    $
    7,861
    
    
    $
    2,578Accounts receivable
    
    
    
    
    
    
    Prepaid expenses and other current assets
    
    
    823
    
    
    
    795Total current assets
    
    
    8,684
    
    
    
    3,372Property and equipment:Laboratory equipment
    
    
    29
    
    
    
    29Office furniture and other equipment
    
    
    94
    
    
    
    101Construction in Progress
    
    
    
    
    
    
    121123
    
    
    
    251Less accumulated depreciation and amortization
    
    
    (104
    )
    
    
    (127
    )Property and equipment, net
    
    
    19
    
    
    
    124Deposit and other non-current assets
    
    
    3
    
    
    
    2Total assets
    
    $
    8,706
    
    
    $
    3,499Liabilities And Stockholders EquityCurrent liabilities:Accounts payable
    
    $
    846
    
    
    $
    904Accounts payable, related party
    
    
    161
    
    
    
    190Accrued expenses
    
    
    1,006
    
    
    
    729Accrued expense, related party
    
    
    886
    
    
    
    444Total liabilities
    
    
    2,899
    
    
    
    2,267Stockholders equity:Preferred stock, $0.001 par value; 20,000,000 shares
authorized at December 31, 2007 and March 31, 2008 and
0 shares issued and outstanding at December 31, 2007
and March 31, 2008Common stock, $0.001 par value; 100,000,000 shares
authorized at December 31, 2007 and March 31, 2008 and
42,346,085 and 42,346,839 shares issued and outstanding
at December 31, 2007 and March 31, 2008, respectively
    
    
    42
    
    
    
    42Additional paid-in capital
    
    
    148,064
    
    
    
    149,160Deficit accumulated during the development stage
    
    
    (142,295
    )
    
    
    (147,920
    )Cumulative translation adjustment
    
    
    (4
    )
    
    
    (50
    )Total stockholders equity
    
    
    5,807
    
    
    
    1,232Total liabilities and stockholders equity
    
    $
    8,706
    
    
    $
    3,499
   3




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NORTHWEST BIOTHERAPEUTICS, INC.
 
 Condensed Consolidated Statements of Operations
 Period fromMarch 18, 1996Three Months Ended
    
    
    (Inception) toMarch 31,
    
    
    March 31,2007
    
    
    2008
    
    
    2008Revenues:Research
material sales
    
    $
    
    
    
    $
    
    
    
    $
    540Contract research and development from related parties
    
    
    
    
    
    
    
    
    
    
    1,128Research grants and other
    
    
    
    
    
    
    
    
    
    
    1,061Total revenues
    
    
    
    
    
    
    
    
    
    
    2,729Operating costs and expenses:Cost of research material sales
    
    
    
    
    
    
    
    
    
    
    382Research and development
    
    
    1,311
    
    
    
    3,062
    
    
    
    47,684General and administrative
    
    
    501
    
    
    
    2,603
    
    
    
    42,741Depreciation and amortization
    
    
    10
    
    
    
    22
    
    
    
    2,344Loss on facility sublease
    
    
    
    
    
    
    
    
    
    
    895Asset impairment loss
    
    
    
    
    
    
    
    
    
    
    2,056Total operating costs and expenses
    
    
    1,822
    
    
    
    5,687
    
    
    
    96,102Loss from operations
    
    
    (1,822
    )
    
    
    (5,687
    )
    
    
    (93,373
    )Other income (expense):Warrant valuation
    
    
    
    
    
    
    
    
    
    
    6,759Gain on sale of intellectual property
    
    
    
    
    
    
    
    
    
    
    3,656Interest expense
    
    
    (131
    )
    
    
    (12
    )
    
    
    (21,342
    )Interest income and other
    
    
    1
    
    
    
    74
    
    
    
    1,189Net loss
    
    
    (1,952
    )
    
    
    (5,625
    )
    
    
    (103,111
    )Issuance of common stock in connection with elimination of Series A and
Series A-1 preferred stock preferences
    
    
    
    
    
    
    
    
    
    
    (12,349
    )Modification of Series A preferred stock warrants
    
    
    
    
    
    
    
    
    
    
    (2,306
    )Modification of Series A-1 preferred stock warrants
    
    
    
    
    
    
    
    
    
    
    (16,393
    )Series A preferred stock dividends
    
    
    
    
    
    
    
    
    
    
    (334
    )Series A-1 preferred stock dividends
    
    
    
    
    
    
    
    
    
    
    (917
    )Warrants issued on Series A and Series A-1 preferred stock dividends
    
    
    
    
    
    
    
    
    
    
    (4,664
    )Accretion of Series A preferred stock mandatory redemption obligation
    
    
    
    
    
    
    
    
    
    
    (1,872
    )Series A preferred stock redemption fee
    
    
    
    
    
    
    
    
    
    
    (1,700
    )Beneficial conversion feature of Series D preferred stock
    
    
    
    
    
    
    
    
    
    
    (4,274
    )Net loss applicable to common stockholders
    
    $
    (1,952
    )
    
    $
    (5,625
    )
    
    $
    (147,920
    )Net loss per share applicable to common stockholders  basic and diluted
    
    $
    (0.45
    )
    
    $
    (0.13
    )Weighted average shares used in computing basic and diluted net loss
per share
    
    
    4,349
    
    
    
    42,346
   4




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NORTHWEST BIOTHERAPEUTICS, INC.
 
 Condensed Consolidated Statements of Cash Flows
 Period fromMarch 18, 1996Three Months Ended
    
    
    (Inception) toMarch 31,
    
    
    March 31,2007
    
    
    2008
    
    
    2008Cash Flows from Operating Activities:Net Loss
    
    $
    (1,952
    )
    
    $
    (5,625
    )
    
    $
    (103,111
    )Reconciliation of net loss to net cash used in operating activities:Depreciation and amortization
    
    
    10
    
    
    
    22
    
    
    
    2,344Amortization of deferred financing costs
    
    
    
    
    
    
    
    
    
    
    320Amortization debt discount
    
    
    56
    
    
    
    
    
    
    
    17,996Accrued interest converted to preferred stock
    
    
    
    
    
    
    
    
    
    
    260Accreted interest on convertible promissory note
    
    
    74
    
    
    
    
    
    
    
    1,484Stock-based compensation costs
    
    
    4
    
    
    
    1,097
    
    
    
    4,888Gain on sale of intellectual property and royalty rights
    
    
    
    
    
    
    
    
    
    
    (3,656
    )Loss on sale of property and equipment
    
    
    
    
    
    
    
    
    
    
    273Warrant valuation
    
    
    
    
    
    
    
    
    
    
    (6,759
    )Asset impairment loss
    
    
    
    
    
    
    
    
    
    
    2,066Loss on facility sublease
    
    
    
    
    
    
    
    
    
    
    895Increase (decrease) in cash resulting from changes in assets and
liabilities:Accounts receivable
    
    
    3
    
    
    
    
    
    
    
    Prepaid expenses and other current assets
    
    
    (131
    )
    
    
    28
    
    
    
    (297
    )Accounts payable and accrued expenses
    
    
    653
    
    
    
    (221
    )
    
    
    1,553Related party accounts payable and accrued expenses
    
    
    
    
    
    
    (410
    )
    
    
    637Accrued loss on sublease
    
    
    
    
    
    
    
    
    
    
    (265
    )Deferred rent
    
    
    
    
    
    
    
    
    
    
    410Net Cash used in Operating Activities
    
    
    (1,283
    )
    
    
    (5,109
    )
    
    
    (80,962
    )Cash Flows from Investing Activities:Purchase of property and equipment, net
    
    
    (11
    )
    
    
    (128
    )
    
    
    (4,732
    )Proceeds from sale of property and equipment
    
    
    
    
    
    
    
    
    
    
    250Proceeds from sale of intellectual property
    
    
    
    
    
    
    
    
    
    
    1,816Proceeds from sale of marketable securities
    
    
    
    
    
    
    
    
    
    
    2,000Refund of security deposit
    
    
    
    
    
    
    
    
    
    
    (3
    )Transfer of restricted cash
    
    
    
    
    
    
    
    
    
    
    (1,035
    )Net Cash used in Investing Activities
    
    
    (11
    )
    
    
    (128
    )
    
    
    (1,704
    )Cash Flows from Financing Activities:Proceeds from issuance of note payable to stockholder
    
    
    1,000
    
    
    
    
    
    
    
    5,750Repayment of note payable to stockholder
    
    
    
    
    
    
    
    
    
    
    (6,700
    )Proceeds from issuance of convertible promissory note and warrants,
net of issuance costs
    
    
    
    
    
    
    
    
    
    
    13,099Borrowing under line of credit, Northwest Hospital
    
    
    
    
    
    
    
    
    
    
    2,834Repayment of line of credit, Northwest Hospital
    
    
    
    
    
    
    
    
    
    
    (2,834
    )Repayment of convertible promissory note
    
    
    
    
    
    
    
    
    
    
    (119
    )Payment on capital lease obligations
    
    
    (2
    )
    
    
    
    
    
    
    (323
    )Payments on note payable
    
    
    
    
    
    
    
    
    
    
    (420
    )Payment of preferred stock dividends
    
    
    
    
    
    
    
    
    
    
    (1,251
    )Proceeds from issuance Series A cumulative preferred stock, net
    
    
    
    
    
    
    
    
    
    
    28,708Proceeds from exercise of stock options and warrants
    
    
    
    
    
    
    
    
    
    
    227Proceeds from issuance common stock, net
    
    
    
    
    
    
    
    
    
    
    48,343Mandatorily redeemable Series A preferred stock redemption fee
    
    
    
    
    
    
    
    
    
    
    (1,700
    )Deferred financing costs
    
    
    
    
    
    
    
    
    
    
    (320
    )Net Cash provided by Financing Activities
    
    
    998
    
    
    
    
    
    
    
    85,294
  5




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Period fromMarch 18, 1996Three Months Ended
    
    
    (Inception) toMarch 31,
    
    
    March 31,2007
    
    
    2008
    
    
    2008Effect of exchange rates on cash
    
    
    
    
    
    
    (46
    )
    
    
    (50
    )Net increase (decrease) in cash
    
    
    (296
    )
    
    
    (5,283
    )
    
    
    2,578Cash at beginning of period
    
    
    307
    
    
    
    7,861
    
    
    
    Cash at end of period
    
    $
    11
    
    
    $
    2,578
    
    
    $
    2,578Supplemental disclosure of cash flow information  Cash paid during
the period for interest
    
    $
    1
    
    
    $
    12
    
    
    $
    1,883Supplemental schedule of non-cash financing activities:Issuance of common stock in connection with elimination of Series A
and Series A-1 preferred stock preferences
    
    $
    
    
    
    $
    
    
    
    $
    12,349Modification of Series A preferred stock warrants
    
    
    
    
    
    
    
    
    
    
    2,306Modification of Series A-1 preferred stock warrants
    
    
    
    
    
    
    
    
    
    
    16,393Warrants issued on Series A and Series A-1 preferred stock dividends
    
    
    
    
    
    
    
    
    
    
    4,664Equipment acquired through capital leases
    
    
    
    
    
    
    
    
    
    
    285Common stock warrant liability
    
    
    
    
    
    
    
    
    
    
    11,841Accretion of mandatorily redeemable Series A preferred stock
redemption obligation
    
    
    
    
    
    
    
    
    
    
    1,872Beneficial conversion feature of convertible promissory notes
    
    
    
    
    
    
    
    
    
    
    7,242Conversion of convertible promissory notes and accrued interest to
Series D preferred stock
    
    
    
    
    
    
    
    
    
    
    5,324Conversion of convertible promissory notes and accrued interest to
Series A-1 preferred stock
    
    
    
    
    
    
    
    
    
    
    7,707Conversion of convertible promissory notes and accrued interest to
common stock
    
    
    
    
    
    
    
    
    
    
    269Issuance of Series C preferred stock warrants in connection with lease
agreement
    
    
    
    
    
    
    
    
    
    
    43Issuance of common stock for license rights
    
    
    
    
    
    
    
    
    
    
    4Issuance of common stock and warrants to Medarex
    
    
    
    
    
    
    
    
    
    
    840Issuance of common stock to landlord
    
    
    
    
    
    
    
    
    
    
    35Deferred compensation on issuance of stock options and restricted
stock grants
    
    
    
    
    
    
    
    
    
    
    759Cancellation of options and restricted stock
    
    
    
    
    
    
    
    
    
    
    849Stock subscription receivable
    
    
    
    
    
    
    
    
    
    
    480Financing of prepaid insurance through note payable
    
    
    
    
    
    
    
    
    
    
    491
   6




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Northwest Biotherapeutics, Inc.
(A Development Stage Company)
 
 Notes to Condensed Consolidated Financial Statements
(unaudited)
 1. Basis of Presentation
   2. Summary of Significant Accounting Policies
  Recent Accounting Pronouncements
 Fair Value Measurements Effective Date of
FASB Statement No. 157 ,
 Business Combinations
 The Fair Value Option for
Financial Assets and Financial Liabilities, including an amendment of FASB Statement No. 115
  7




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Noncontrolling Interests in Consolidated Financial
Statements  an amendment of ARB No. 51
 Disclosures about Derivative Instruments and
Hedging Activities
 Accounting for Collaborative Arrangements
 Accounting for Advance Payments
for Goods or Services Received for Use in Future Research and Development Activities
 3. Fair Value Measurements
  Level 1
    
    Quoted market prices in active markets for identical assets or liabilities.Level 2
    
    Observable market based inputs or unobservable inputs that are corroborated by market data.Level 3
    
    Unobservable inputs that are not corroborated by market data.
    8




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4. Stock-Based Compensation Plans
 Share Based Payment
    Stock Option Plans
  5. Liquidity
   Management Loans
    9




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Toucan Capital and Toucan Partners
     Conversion of Preferred Stock and Related Matters
      10




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
    
    an aggregate of 19,299,486 shares of Common Stock;
 
    
    warrants to purchase 14,150,732 shares of Common Stock at an exercise price of $0.60 per
share; and
 
    
    warrants to purchase 7,884,357 shares of Common Stock at an exercise price of $0.15 per
share.
  
    
    an aggregate of 2,572,710 shares of Common Stock; and
 
    
    warrants to purchase 8,832,541 shares of Common Stock at an exercise price of $0.60 per
share.
     11




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Private Placement
    Placement of Common Stock with Foreign Institutional Investors
  Liability For Potentially Dilutive Securities in Excess of Authorized Number of Common Shares
   Going Concern
 ® ® ® ®
  12




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® ®
  6. Net Income (Loss) Per Share Applicable to Common Stockholders
   7. Related Party Transactions
 Cognate Agreement
 ® ®
  13




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##### Table of Contents



Toucan Capital Management
   8. Contingencies
 Private Placement
    Legal Proceedings
 Soma Arbitration
   14




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Lonza Patent Infringement Claim
 ® ®
 Stockholder Class Action Lawsuits
  SEC Inquiry
   15




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##### Table of Contents



Management Warrants
    9. Subsequent Events
  
 Item. 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
  Overview
  ® ® ®
   16




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Critical Accounting Policies and Estimates
  Recent Accounting Pronouncements
 Business Combinations
  17




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##### Table of Contents



Noncontrolling Interests in Consolidated Financial
Statements  an amendment of ARB No. 51
 Disclosures about Derivative Instruments and
Hedging Activities
 Issue
No. 07-1 Accounting for Collaborative Arrangements
 Results of Operations
 Operating costs:
  Research and development:
  ®
 General and administrative:
  Three Months Ended March 31, 2007 and 2008
   18




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Research and Development Expense.
 
    
    increased monthly contract manufacturing costs for our DCVax® product of
approximately $1.1 million;
 
    
    increased support costs related to the development of a clinical trial program and
potential compassionate use/named patient programs in Switzerland and elsewhere of
approximately $266,000;
 
    
    increased clinical costs due to the initiation of additional clinical sites and
screening and enrollment of patients in our Phase II DCVax®-Brain clinical
trial of approximately $225,000; and
 
    
    increased personnel costs as we build our clinical organization.
 General and Administrative Expense.
 
    
    costs associated with our AIM listing in the United Kingdom;
 
    
    potentially non-recurring start-up costs (mainly consulting and travel costs) for
international programs, specifically in Switzerland, Spain and Israel;
 
    
    higher staffing costs associated with expansion of our business activities in the
United States and internationally;
 
    
    legal costs associated with ongoing litigation;
 
    
    additional rent expense related to our new headquarters located in Bethesda, Maryland;
and
 
    
    FAS 123(R) expense associated with stock option grants to executives.
 Depreciation and Amortization.
 Total Other Income (Expense), Net.
 Liquidity and Capital Resources
 Toucan Capital and Toucan Partners
     19




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Conversion of Preferred Stock and Related Matters
       20




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
    
    an aggregate of 19,299,486 shares of common stock;
 
    
    warrants to purchase 14,150,732 shares of common stock at an exercise price of $0.60 per
share; and
 
    
    warrants to purchase 7,884,357 shares of common stock at an exercise price of $0.15 per
share.
  
    
    an aggregate of 2,572,710 shares of common stock; and
 
    
    warrants to purchase 8,832,541 shares of common stock at an exercise price of $0.60 per
share.
     Other Financings
   21




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® ®
 Sources of Cash
  Uses of Cash
 ® ®
    22




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Item 3. Quantitative and Qualitative Disclosures About Market Risk
 Market Interest Rate Risk
  Foreign Currency Exchange Rate Risk
  
 Item 4. Controls and Procedures
 Controls and Procedures
  Evaluation of disclosure controls and procedures
  Material Weaknesses Identified
    23




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Plan for Remediation of Material Weaknesses
   
    
    We plan to recruit one or more additional independent board members to join our board of
directors in due course. Such recruitment will include at least one person who qualifies as
an audit committee financial expert to join as an independent board member and as an audit
committee member.
 
    
    We have hired additional qualified and experienced accounting personnel to perform the
month-end review and closing processes as well as provide additional oversight and
supervision within the accounting department. On October 1, 2007, we hired a full-time chief
financial officer. In February 2008, we hired a full-time controller who has assisted us in
documenting the majority of our processes. We are in the process of establishing more
rigorous review procedures. In addition, we have changed our accounting system to make it
simpler and more appropriate for a company our size.
 
    
    We are initiating a formal commitment review process to establish and document the
accounting events and methodology at the time the transactions are entered into, so that
there is a clear understanding of what events will trigger an accounting event and establish
the amounts to be recognized for each event.
 
    
    We are initiating a formal monthly reporting and approval process with our related
parties to ensure timely provision of information affecting our quarterly and annual
consolidated financial statements.
  24




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Changes in Internal Control over Financial Reporting
    25




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Part II  Other Information
 
 Item 1. Legal Proceedings
  SOMA Arbitration
      Lonza Patent Infringement Claim
 ® ®
  26




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##### Table of Contents



Stockholder Class Action Lawsuits
  SEC Inquiry
  Management Warrants
    
 Item 1A. Risk Factors
  We will need to raise additional capital, which may not be available.
 ®
  27




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We are likely to continue to incur substantial losses, and may never achieve profitability.
  Our auditors have issued a going concern audit opinion.
  As a company in the early stage of development with an unproven business strategy, our limited
history of operations makes an evaluation of our business and prospects difficult.
  We may not be able to retain existing personnel.
  We may not be able to attract expert personnel.
  We rely on a single relationship with a third-party contract manufacturer, which will limit our
ability to control the availability of our product candidates in the near-term.
 ® ® ® ® ®
  28




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Our success partly depends on existing and future collaborators.
  ®
  We are involved in legal proceedings that could result in an adverse outcome, or that could
otherwise harm our business. In addition, future litigation could be costly to defend or pursue and
uncertain in its outcome.
 ®
  Clinical trials for our product candidates are expensive and time-consuming and their outcome is
uncertain.
   29




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We have limited experience in conducting and managing clinical trials.
 ®
 Our product candidates will require a different distribution model than conventional therapeutic
products.
  We lack sales and marketing experience and as a result may experience significant difficulties
commercializing our research product candidates.
   Competition in the biotechnology and biopharmaceutical industry is intense and most of our
competitors have substantially greater resources than us.
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Our intellectual property rights may not provide meaningful commercial protection for our research
products or product candidates, which could enable third parties to use our technology, or very
similar technology, and could reduce our ability to compete in the market.
  ®
    Our success will depend substantially on our ability to operate without infringing or
misappropriating the proprietary rights of others.
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We may not receive regulatory approvals for our product candidates or there may be a delay in
obtaining such approvals.
   Further trials and other costly and time-consuming assessments of our product candidates may be
required to obtain or maintain regulatory approval.
  ®
 ® ® ® ®
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® ®
  Regulatory approval may be withdrawn at any time.
  We may fail to comply with regulatory requirements.
  We may be subject to sanctions if we are determined to be promoting our investigational products
prior to regulatory approval or for unapproved uses.
  We may not obtain or maintain orphan drug status and the associated benefits, including marketing
exclusivity.
 ® ® ®
 New legislation may have an adverse effect on our business.
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The availability and amount of reimbursement for our product candidates and the manner in which
government and private payers may reimburse for our potential products is uncertain.
      DCVax ® is our only technology in clinical development.
 ® ®
 We may be prevented from using the DCVax ® name in Europe.
 ® ®
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Competing generic medicinal products may be approved.
  We may be exposed to potential product liability claims, and insurance against these claims may not
be available to us at a reasonable rate in the future, if at all.
  We use hazardous materials and must comply with environmental, health and safety laws and
regulations, which can be expensive and restrict how we do business.
   Toucan Capital and Toucan Partners beneficially own a majority of our shares of common stock and,
as a result, the trading price for our common stock may be depressed and these stockholders can
take actions that may be adverse to the interests of other investors.
  Our Certificate of Incorporation and Bylaws and stockholder rights plan may delay or prevent a
change in our management.
  
    
    authorize the issuance of preferred stock that can be created and issued by the Board
without prior stockholder approval, commonly referred to as blank check preferred stock,
with rights senior to those of the common stock;
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
    
    allow the Board to call special meetings of stockholders at any time but restrict the
stockholders from calling special meetings;
 
    
    authorize the Board to issue dilutive common stock upon certain events; and
 
    
    provide for a classified Board.
  There may not be an active, liquid trading market for our common stock.
  
    
    limited release of the market price of our securities;
 
    
    limited news coverage;
 
    
    limited interest by investors in our securities;
 
    
    volatility of our stock price due to low trading volume;
 
    
    increased difficulty in selling our securities in certain states due to blue sky
restrictions; and
 
    
    limited ability to issue additional securities or to secure additional financing.
 The resale, or the availability for resale, of the shares placed in the PIPE Financing could have a
material adverse impact on the market price of our common stock.
  Because our common stock is subject to penny stock rules, the market for the common stock may be
limited.
  
    
    make a special written suitability determination for the purchaser;
 
    
    receive the purchasers written agreement to a transaction prior to sale;
 
    
    provide the purchaser with risk disclosure documents which identify certain risks
associated with investing in penny stocks and which describe the market for these penny
stocks as well as a purchasers legal remedies; and
 
    
    obtain a signed and dated acknowledgment from the purchaser demonstrating that the
purchaser has actually received the required risk disclosure document before a transaction
in a penny stock can be completed.
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The price of our common stock may be highly volatile.
  The requirements of the Sarbanes-Oxley Act of 2002 and other U.S. securities laws reporting
requirements impose cost and operating challenges on us.
  Our management has identified significant internal control deficiencies, which management and our
independent auditor believe constitute material weaknesses.
  
    
    lack of a sufficient number of independent directors on our audit committee;
 
    
    insufficient segregation of duties in our finance and accounting function due to limited
personnel;
 
    
    insufficient corporate governance policies; and
 
    
    inadequate approval and control over transactions and commitments made on our behalf by
related parties.
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Our business could be adversely affected by animal rights activists.
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3. Defaults upon Senior Securities
  
 Item 4. Submission of Matters to a Vote of Security Holders
  
 Item 5. Other Information
  
 Item 6. Exhibits
 3.1
    
    
    Seventh Amended and Restated Certificate of Incorporation (3.1)(1)3.2
    
    
    Third Amended and Restated Bylaws (3.1)(2)3.3
    
    
    Amendment to the Seventh Amended and Restated Certificate of Incorporation (3.2)(2)3.4
    
    
    Amendment to Seventh Amended and Restated Certificate of Incorporation (3.4)(3)*31.1
    
    
    Certification of President and Chief Executive Officer, Pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a),
as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*31.2
    
    
    Certification of Chief Financial Officer (Principal Financial and Accounting Officer), Pursuant to Exchange Act
Rules 13a-14(a) and 15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*32.1
    
    
    Certification of President and Chief Executive Officer, Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*32.2
    
    
    Certification of Chief Financial Officer (Principal Financial and Accounting Officer), Pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.
 
 (1)
    
    Incorporated by reference to the exhibit shown in the preceding parentheses filed with the Registrants registration statement
Form S-1 (File No. 333-67350) on July 17, 2006.(2)
    
    Incorporated by reference to the exhibit shown in the preceding parentheses filed with the Registrants Current Report on
Form 8-K on June 22, 2007.(3)
    
    Incorporated by reference to the exhibit shown in the preceding parentheses filed with the Post-Effective Amendment No. 2 to the
Registrants Registration Statement on Form S-1 on January 28, 2008.*
    
    Filed herewith.  38




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SIGNATURES
  NORTHWEST BIOTHERAPEUTICS, INCDated: May 15, 2008
    By:
    /s/ Alton L. BoyntonAlton L. BoyntonPresident and Chief Executive Officer
(Principal Executive Officer)By:
    /s/ Anthony P. DeaseyAnthony P. DeaseySenior Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer)  39




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NORTHWEST BIOTHERAPEUTICS, INC.
(A Development Stage Company)
 
 EXHIBIT INDEX
 3.1
    
    
    Seventh Amended and Restated Certificate of Incorporation (3.1)(1)3.2
    
    
    Third Amended and Restated Bylaws (3.1)(2)3.3
    
    
    Amendment to the Seventh Amended and Restated Certificate of Incorporation (3.2)(2)3.4
    
    
    Amendment to Seventh Amended and Restated Certificate of Incorporation (3.4)(3)*31.1
    
    
    Certification of President and Chief Executive Officer, Pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a),
as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*31.2
    
    
    Certification of Senior Vice President and Chief Financial Officer (Principal Financial and Accounting Officer),
Pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.*32.1
    
    
    Certification of President and Chief Executive Officer, Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*32.2
    
    
    Certification of Senior Vice President and Chief Financial Officer (Principal Financial and Accounting Officer),
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 
 (1)
    
    Incorporated by reference to the exhibit shown in the preceding parentheses filed with the Registrants registration statement
Form S-1 (File No. 333-67350) on July 17, 2006.(2)
    
    Incorporated by reference to the exhibit shown in the preceding parentheses filed with the Registrants Current Report on
Form 8-K on June 22, 2007.(3)
    
    Incorporated by reference to the exhibit shown in the preceding parentheses filed with the Post-Effective Amendment No. 2 to the
Registrants Registration Statement on Form S-1 on January 28, 2008.*
    
    Filed herewith.  40