Edgar Filing: NEOSE TECHNOLOGIES INC

As filed with the Securities and Exchange Commission on May 2, 2003

Registration No.333-103883
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

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Amendment No. 1 to
Form S-3
Registration Statement Under
The Securities Act of 1933

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Neose Technologies, Inc.
(Exact name of Registrant as specified in its charter)

Delaware 13-3549286
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(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)

102 Witmer Road
Horsham, Pennsylvania 19044
(215) 315-9000
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)

Debra J. Poul, Esquire
Senior Vice President and
General Counsel
Neose Technologies, Inc.
102 Witmer Road
Horsham, Pennsylvania 19044
(215) 315-9000

(Name, address, including zip code, and telephone
number, including area code, of agent for service)
COPY TO:
Barry M. Abelson, Esquire
Pepper Hamilton LLP
3000 Two Logan Square
Eighteenth and Arch Streets
Philadelphia, PA 19103-2779
(215) 981-4000

Approximate date of commencement of proposed sale to the public:
As soon as practicable after this Registration Statement becomes effective.

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, 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 of 1933, 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 Rule 462(c)
under the Securities Act of 1933, 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 Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement 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. [_]

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The Registrant hereby amends this Registration Statement on such 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 or until the Registration Statement shall become
effective on such date as the SEC, acting pursuant to said Section 8(a), may
determine.
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+ The information in this prospectus is not complete and may be changed. The +
+ selling stockholders may not 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 the offer or +
+ sale is not permitted. +
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Subject to Completion, dated May 2, 2003

PROSPECTUS
----------

2,866,763 Shares
Common Stock

[NEOSE TECHNOLOGIES, INC. LOGO]

This prospectus relates to the resale of 2,866,763 shares of common
stock issued to the selling stockholders listed on page 9 under the terms of a
stock purchase agreement. We will not receive any proceeds from the sale of the
shares by the selling stockholders.

The selling stockholders, or their pledgees, donees, transferees or
other successors-in-interest, may offer the common stock from time to time
through public or private transactions, at prevailing market prices, at prices
related to prevailing market prices, at privately negotiated prices or any other
lawful methods.

Our common stock is listed on The Nasdaq National Market under the
symbol "NTEC." On May 1, 2003, the reported last sale price of our common
stock on The Nasdaq National Market was $7.76 per share.

Our principal offices are located at 102 Witmer Road, Horsham,
Pennsylvania 19044, and our telephone number is (215) 315-9000.

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INVESTING IN OUR COMMON STOCK INVOLVES RISKS. YOU SHOULD CAREFULLY CONSIDER
THE "RISK FACTORS" BEGINNING ON PAGE 1 OF THIS PROSPECTUS BEFORE YOU DECIDE
TO INVEST.
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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 date of this Prospectus is __________, 2003.

TABLE OF CONTENTS

Page
----

WHO WE ARE ................................................................. 1
RISK FACTORS ............................................................... 1
SPECIAL NOTE REGARDING FORWARDING LOOKING STATEMENTS ....................... 8
USE OF PROCEEDS ............................................................ 8
SELLING STOCKHOLDERS ....................................................... 9
PLAN OF DISTRIBUTION ....................................................... 10
LEGAL MATTERS .............................................................. 12
EXPERTS .................................................................... 12
ADDITIONAL INFORMATION ..................................................... 13

You should rely only on the information contained in this prospectus. We
have not authorized anyone to provide you with information different from that
contained or incorporated by reference in this prospectus. The selling
stockholders are offering to sell, and seeking offers to buy, shares of our
common stock only in jurisdictions where offers and sales are permitted. The
information contained in this prospectus is accurate only as of the date of this
prospectus, regardless of the time of delivery of this prospectus or of any sale
of common stock.

-i-

WHO WE ARE

We are a biopharmaceutical company focused on improving glycoprotein
therapeutics using our proprietary technologies. Most therapeutic proteins in
development or on the market today are glycoproteins - proteins with
carbohydrate structures attached. These carbohydrates are important to the
proper functioning of the proteins. The process by which carbohydrates are
attached to proteins is called "glycosylation." Manufacturing protein drugs
using traditional biotech cell systems often results in the problem of
incomplete glycosylation. We are using our GlycoAdvance(TM), GlycoPEGylation(TM)
and GlycoConjugation(TM) technologies to develop improved versions of currently
marketed drugs with proven efficacy, to complete the natural glycosylation of
protein, and to improve therapeutic profiles of glycoproteins in development for
our partners. We expect these next generation proteins to offer significant
advantages over drugs that are now on the market, including less frequent dosing
and improved safety and efficacy. In addition to developing our own products or
co-developing products with others, we expect to enter into strategic
partnerships for including our technologies into the product design and
manufacturing processes of other biotechnology and pharmaceutical companies.
While our primary goal is protein drug development, our technologies offer
multiple opportunities to participate in the evolving therapeutic protein market
by addressing other challenges, such as manufacturing efficiency, manufacturing
consistency, and the use of non-mammalian cell expression systems.

We were incorporated in Delaware in May 1991. Our executive offices
and research facility are located at 102 Witmer Road, Horsham, PA 19044, our
telephone number is 215-315-9000 and our website is at http://www.neose.com.
Information contained on our website is not incorporated into this registration
statement.

RISK FACTORS

You should carefully consider the risks described below before making
an investment decision. These are the material risks currently known to us.
Additional risks not presently known to us or that we currently deem immaterial
may also impair our business operations.

Our business, financial condition or results of operations could be
materially adversely affected by any of these risks. The trading price of our
common stock could decline due to any of these risks, and you may lose all or
part of your investment.

This prospectus also contains forward-looking statements that involve
risks and uncertainties. Our actual results could differ materially from those
anticipated in these forward-looking statements as a result of certain factors,
including the risks faced by us described below and elsewhere in this
prospectus.

Risks Related to Development Stage Company

If we fail to obtain necessary funds for our operations, we will be unable
to maintain and improve our technology position and we will be unable to develop
and commercialize our therapeutic proteins.

To date, we have funded our operations primarily through proceeds from
the public and private placements of debt and equity securities. We have also
funded our operations to a lesser extent from interest earned on investments,
proceeds from property and equipment financing, revenues from corporate
collaborations and gains from the sale of investments. We believe that our
existing cash and short-term investments, expected revenue from collaborations
and license arrangements, anticipated financing of capital expenditures, and
interest income should be sufficient to meet our operating and capital
requirements at least through the middle of 2004. Our present and future capital
requirements depend on many factors, including:

. the level of research and development investment required to
develop our therapeutic proteins and improve our technology
position;
. the progress of preclinical and clinical testing;
. the time and cost involved in obtaining regulatory approvals;
. our ability to enter into new agreements with collaborators
and to extend our existing collaborations, and the terms of
these agreements;
. our success rate or that of our collaborators in discovery
efforts associated with milestones and royalties;

-1-

. the timing, willingness, and ability of our collaborators to
commercialize products incorporating our technologies;
. costs of recruiting and retaining qualified personnel;
. costs of filing, prosecuting, defending, and enforcing patent
claims and other intellectual property rights;
. our need or decision to acquire or license complementary
technologies or new drug targets; and
. changes in product candidate development plans needed to
address any difficulties in clinical studies or in
commercialization.

We will require significant amounts of additional capital in the
future, and we do not have any assurance that funding will be available when we
need it on terms that we find favorable, if at all. We may seek to raise these
funds through public or private equity offerings, debt financings, credit
facilities, or through corporate collaborations and licensing arrangements.

If we raise additional capital by issuing equity securities, our
existing stockholders' percentage ownership would be reduced and they may
experience substantial dilution. We may also issue equity securities that
provide for rights, preferences, or privileges senior to those of our common
stock. If we raise additional funds by issuing debt securities, these debt
securities would have rights, preferences, and privileges senior to those of our
common stock, and the terms of the debt securities issued could impose
significant restrictions on our operations. If we enter into a credit facility,
the agreement may require us to maintain compliance with financial covenants and
restrict our ability to incur additional debt, pay dividends, make redemptions
or repurchases of capital stock, make loans, investments or capital
expenditures, or engage in other activities. If we raise additional funds
through collaborations and licensing arrangements, we may be required to
relinquish some rights to our technologies or drug candidates, or to grant
licenses on terms that are not favorable to us. If adequate funds are not
available or are not available on acceptable terms, our ability to fund our
operations, take advantage of opportunities, develop products or technologies,
or otherwise respond to competitive pressures could be significantly delayed or
limited, and we may need to downsize or halt our operations.

We have a history of losses, and we may incur continued losses for some
time.

We have incurred losses each year, including net losses of
approximately $8.5 million for the year ended December 31, 2000, approximately
$13.3 million for the year ended December 31, 2001, and approximately $26.4
million for the year ended December 31, 2002. Given our planned level of
operating expenses, we expect to continue incurring losses for some time. As of
December 31, 2002, we had an accumulated deficit of approximately $108 million.
To date, we have derived substantially all of our revenue from corporate
collaborations, license agreements, and investments. We expect that
substantially all of our revenue for the foreseeable future will result from
these sources and from the licensing of our technologies. We also expect to
spend significant amounts to expand our research and development on our
proprietary drug candidates and technologies, maintain and expand our
intellectual property position, expand our manufacturing scale-up activities,
and expand our business development and commercialization efforts. We may
continue to incur substantial losses even if our revenues increase.

In 2003, we expect our investment in capital expenditures to be
approximately $3.0 million to $5.0 million which we may finance through the
issuance of new debt or equity. Our level of operating expenditures will vary
depending upon our stage of development of our proprietary proteins and the
number and nature of collaboration agreements we enter into.

We have a joint venture with McNeil Nutritionals, a subsidiary of
Johnson & Johnson. The joint venture has incurred losses since its inception,
and we expect that the joint venture will incur additional losses for some time
while it explores opportunities to continue the development of this technology.

We have not yet commercialized any products or technologies, and we may
never become profitable.

We have not yet developed any products or commercialized any products
or technologies, and we may never be able to do so. Since we began operations in
1990, we have not generated any revenues, except for interest income and
revenues from collaborative agreements and investments. We do not know when or
if we will complete any of our product development efforts, receive regulatory
approval of any of our product candidates, or successfully commercialize any
approved products. Even if we should be successful in developing products that
are approved for marketing, we will not be successful unless our products, and
products incorporating our technologies, gain market acceptance. The degree of
market acceptance of these products will depend on a number of factors,
including:

. the receipt of regulatory approvals for the uses we seek;
. the establishment and demonstration in the medical community
of the safety and clinical efficacy of our products and their
potential advantages over existing therapeutic products; and
. pricing and reimbursement policies of government and
third-party payors, such as insurance companies, health
maintenance organizations and other plan administrators.

Physicians, patients, payors or the medical community in general may be
unwilling to accept, utilize or recommend any of our products or products
incorporating our technologies. As a result, we are unable to predict the extent
of future losses or the time required to achieve profitability, if at all. Even
if we or our collaborators successfully develop one or more products that
incorporate our technologies, we may not become profitable.

Risks Related to Development of Products and Technologies

We have limited product development and commercial manufacturing capability
and experience, and we may be unable to develop therapeutic proteins and
commercialize our technologies.

Until recently, we have not focused on the development of our own
proprietary products. We are now seeking to use our GlycoAdvance,
GlycoPEGylation and GlycoConjugation technologies to develop proprietary next
generation proteins, generally in collaboration with a partner. Our technologies
may not result in the successful remodeling, optimization or development of
proteins that are safe or efficacious. Because the development of new
pharmaceutical products is highly uncertain, our technologies may not produce
any commercially successful proteins. If we fail to validate our technologies
through the successful remodeling of the proteins we select for development, we
will not be able to license our next generation drug candidates, and our
customers will not be able to develop drug candidates incorporating our
technologies.

To date, we have manufactured only smaller, noncommercial quantities
of our enzymes, sugar nucleotides, and complex carbohydrates. We intend to
manufacture enzymes and sugar nucleotides for use in our proprietary product
development programs and for use by our customers. Our success depends on our
ability to manufacture these compounds on a commercial scale and in accordance
with current Good Manufacturing Practices, or cGMP, prescribed by the U.S. Food
and Drug Administration, or FDA. We may not be able to manufacture sufficient
quantities of the products we develop, even to meet our needs for pre-clinical
or clinical development, and we may have problems complying, or maintaining
compliance, with cGMP.

In addition to the normal scale-up risks associated with any
manufacturing process, we may face unanticipated problems unique to the
manufacture of enzymes, sugar nucleotides, or complex carbohydrates. If we are
unable to develop commercial-scale manufacturing capacity, we would seek
collaborators, licensees, or contract manufacturers to manufacture the compounds
necessary to commercialize our technologies. We may not be able to find parties
willing to manufacture these compounds at acceptable prices.

Any manufacturing facility must adhere to the FDA's evolving
regulations on cGMP, which are enforced by the FDA through its facilities
inspection program. The manufacture of products at these facilities will be
subject to strict quality control, testing, and record keeping requirements, and
continuing obligations regarding the submission of safety reports and other
post-market information. Ultimately, we or our contract manufacturers may not
meet these requirements.

If we encounter delays or difficulties in connection with
manufacturing, commercialization of our products and technologies could be
delayed, or we could breach our obligations under our collaborative agreements.

Our success depends on collaborative relationships, and our failure to
enter into new collaborations or to expand our existing relationships could
prevent us from commercializing any product candidates.

We cannot fully develop any proprietary product without the help of a
partner. We plan to rely on new collaborative partners to co-develop products
and to commercialize products made using our technologies. We are now conducting
early stage research programs for our two existing collaborative partners. We
anticipate that substantially all of our revenues during the next several years
will continue to be generated from collaboration or license agreements. This
strategy entails many risks, including:

. we may be unsuccessful in entering into collaborative agreements
for the co-development of products, or into new or expanded
collaborative agreements for the commercialization of products
incorporating our technologies;

. our existing collaborators may not continue or expand the work we
are now conducting;

. we may not be successful in adapting our technologies to the
needs of our collaborative partners;

. our collaborators may not be successful in, or may not remain
committed to, co-developing products incorporating our
technologies;

. our collaborators may not commit sufficient resources to
incorporating our technologies into their products;

. our collaborators may seek to develop proprietary alternatives to
our products or technologies;

. none of our existing collaborators is contractually obligated to
continue developing products with us or to market or
commercialize products incorporating our technologies, nor is any
of them contractually required to achieve any specific production
schedule;

. our collaborative agreements are generally terminable by our
partners on short notice; and

. continued consolidation in our target markets may also limit our
ability to enter into collaboration agreements, or may result in
terminations of existing collaborations.

Any of our present or future collaborators may breach or terminate
their agreements with us or otherwise fail to conduct their collaborative
activities successfully and in a timely manner. In addition, we may dispute the
application of payment provisions under any of our collaborative agreements. If
any of these events occur or if we fail to enter into or maintain collaborative
agreements, we may not be able to commercialize our products and technologies.

Our potential damage from business interruptions is increasing.

Like other businesses, we and our collaborators are exposed to the
risks of business interruptions at our facilities, such as electrical outages,
earthquakes and other natural and human disasters. Any interruption of our
utility supplies or ability to continue work could ruin an entire manufacturing
batch and ongoing research experiments. As our manufacturing operations increase
in importance, and as we scale up the size of our manufacturing batches,
business interruptions are becoming a greater financial risk. Any business
interruption could result in significant expense and may result in our inability
to comply with our manufacturing and development schedules.

We may be exposed to product liability and related risks.

The use in humans of compounds developed by us or incorporating our
technologies may result in product liability claims. Product liability claims
can be expensive to defend, and may result in large settlements of claims or
judgments against us. Even if a product liability claim is not successful, the
adverse publicity, time, and expense involved in defending such a claim may
interfere with our business. We may not be able to obtain insurance coverage at
a reasonable cost or in sufficient amounts to protect us against losses.

Risks Related to Intellectual Property

The failure to obtain or maintain adequate patents, and other intellectual
property protection, could impact our ability to compete effectively.

Our commercial success depends in part on avoiding infringing patents
and proprietary rights of third parties and developing and maintaining a
proprietary position with regard to our own technologies, products and business.
As we seek to develop next generation proprietary products, we will have to
investigate the patent protection for our target proteins. Patent protection
often comprises multiple claims in multiple patents, requiring complex analysis
of which claims may be applicable. In addition, there have been significant
litigation and interference proceedings regarding patent rights, and the patent
situation regarding particular products is often complex and uncertain. For
example, with respect to EPO, the target of our first development program, there
are numerous patents containing numerous claims. The status of issued patents is
currently being litigated. It is possible that applicable claims may be
invalidated, opening up the field for us as well as others. It is also possible
that applicable claims contained in numerous patents will be upheld. If some or
all of these claims are upheld, our ability to market EPO in the U.S. could be
delayed until 2015. Even if our product candidate would not infringe issued
patent claims, litigation could result, the outcome of which would be uncertain.

As we choose other targets, we may face uncertainty and litigation could result,
which could lead to liability for damages, prevent our development and
commercialization efforts, and divert resources from our business strategy.

Legal standards relating to the validity and scope of claims in our
technology field are still evolving. Therefore, the degree of future protection
for our proprietary rights in our core technologies and products made using
these technologies is also uncertain. The risks and uncertainties that we face
with respect to our patents and other proprietary rights include the following:

. the pending patent applications we have filed or to which we have
exclusive rights may not result in issued patents or may take longer
than we expect to result in issued patents;
. we may be subject to interference proceedings;
. the claims of any patents that are issued may not provide meaningful
protection;
. we may not be able to develop additional proprietary technologies that
are patentable;
. the patents licensed or issued to us or our customers may not provide
a competitive advantage;
. other companies may challenge patents licensed or issued to us or our
customers;
. other companies may independently develop similar or alternative
technologies, or duplicate our technologies; and
. other companies may design around technologies we have licensed or
developed.

We cannot be certain that patents will be issued as a result of any of our
pending applications. Nor can we be certain that any of our issued patents would
give us adequate protection from competing products. For example, issued patents
may be circumvented or challenged and declared invalid, narrow in scope, or
unenforceable. In addition, since publication of discoveries in the scientific
or patent literature often lags behind actual discoveries, we cannot be certain
that we were the first to make our inventions or to file patent applications
covering those inventions. In the event that another party has also filed a
patent application relating to an invention claimed by us, we may be required to
participate in an interference proceeding declared by the U.S. Patent and
Trademark Office to determine priority of invention, which could result in
substantial uncertainties and cost for us, even if the eventual outcome were
favorable to us. It is also possible that others may obtain issued patents that
could prevent us from commercializing our products or require us to obtain
licenses requiring the payment of significant fees or royalties in order to
enable us to conduct our business. As to those patents that we have licensed,
our rights depend on maintaining our obligations to the licensor under the
applicable license agreement, and we may be unable to do so.

The cost to us of any patent litigation or other proceeding relating to our
patents or applications, even if resolved in our favor, could be substantial.
Others seeking to develop next generation versions of proteins, or the holders
of patents on our target proteins, may have greater financial resources, making
them better able to bear the cost of litigation. Uncertainties resulting from
the initiation and continuation of patent litigation or other proceedings could
have a material adverse effect on our ability to develop, manufacture, and
market products, form strategic alliances, and compete in the marketplace.

In addition to patents and patent applications, we depend upon trade
secrets and proprietary know-how to protect our proprietary technology. We
require our employees, consultants, advisors, and collaborators to enter into
confidentiality agreements that prohibit the disclosure of confidential
information to any other parties. We require our employees and consultants to
disclose and assign to us their ideas, developments, discoveries, and
inventions. These agreements may not, however, provide adequate protection for
our trade secrets, know-how, or other proprietary information in the event of
any unauthorized use or disclosure.

International patent protection is uncertain.

Patent law outside the U.S. is uncertain, and is currently undergoing
review and revision in many countries. In addition, the laws of some foreign
countries may not protect our intellectual property rights to the same extent as
U.S. laws. We may participate in opposition proceedings to determine the
validity of foreign patents belonging to us or our competitors, which
proceedings could result in substantial costs and diversion of our efforts.
Finally, some of

our patent protection in the U.S. is not available to us in foreign countries
due to the differences in the patent laws of those countries.

We may have to develop or license alternative technologies if we are
unable to maintain or obtain key technology from third parties.

We have licensed patents and patent applications from a number of
institutions. Some of our proprietary rights have been licensed to us under
agreements that have performance requirements or other contingencies. The
failure to comply with these provisions could lead to termination or
modifications of our rights to these licenses. Additionally, we may need to
obtain additional licenses to patents or other proprietary rights from other
parties to facilitate development of our proprietary technology base. If our
existing licenses are terminated or if we are unable to obtain such additional
licenses on acceptable terms, our ability to perform our own research and
development and to comply with our obligations under our collaborative
agreements may be delayed while we seek to develop or license alternative
technologies.

Risks Related to Competition

If our competitors succeed in developing more effective or less costly
products, we will may not be able to commercialize any next generation protein
therapeutics.

Our business is characterized by extensive research efforts and rapid
technological progress. New developments in molecular biology, medicinal
chemistry, and other fields of biology and chemistry are expected to continue at
a rapid pace in both industry and academia. Our potential competitors include
both public and private pharmaceutical and biotechnology companies, as well as
academic institutions, governmental agencies and other public and private
research organizations which are also conducting research activities and seeking
patent protection.

A number of these competitors are working on the development of next
generation protein therapeutics. Some of these competitors include Maxygen,
Applied Molecular Evolution, Nektar, Enzon, Human Genome Sciences, BioRexis and
Alkermes. There are a number of companies that have active programs focused on
developing next generation or improved versions of EPO. These companies include
Roche, Amgen, Johnson & Johnson, Gryphon, Transkaryotic Therapeutics, Human
Genome Sciences, and ARIAD. Other companies are active in this area, and we
expect that competition will increase. There are several companies that are
engaged in glycobiology research. These companies include Crucell, Glycart, and
GlycoFi.

Compared to us, many of these companies have more:

o financial, scientific, and technical resources;

o product development, manufacturing and marketing capabilities;

o experience conducting preclinical studies and clinical trials of new
products; and

o experience in obtaining regulatory approvals for products.

Competitors may succeed in developing products and technologies that
are more effective and less costly than ours, which would render our products or
technologies, or both, obsolete or noncompetitive. We know that other companies
with substantial resources are working on the development of next generation
proteins, and they may achieve better results in remodeling our target proteins
or the target proteins of our potential collaborators.

Competitors also may prove to be more successful in designing,
manufacturing and marketing of products. If we are successful in developing our
own drug candidates or versions of drugs that are no longer patented, we will
compete with other drug manufacturers for market share. If we are unable to
compete successfully, our commercial opportunities will be diminished.

We may be unable to retain key employees or recruit additional qualified
personnel.

Because of the specialized scientific nature of our business, we are
highly dependent upon qualified scientific, technical and managerial personnel,
including our research and development team and our president and CEO, C. Boyd
Clarke. The development of our business is dependent upon our management team's
ability to evaluate collaboration opportunities and on our CEO's ability to
focus the Company's efforts. Our anticipated research and development efforts
will require additional expertise and the addition of new qualified personnel.
There is intense competition for qualified management and research and
development personnel in the pharmaceutical field. Therefore, we may not be able
to attract and retain the qualified personnel necessary for the development of
our business. The loss of the services of existing personnel, as well as the
failure to recruit additional key scientific, technical and managerial personnel
in a timely manner would harm our research and development programs, our ability
to manage day-to-day operations, attract collaboration partners, attract and
retain other employees, and generate revenues. We do not maintain key man life
insurance on any of our employees.

Risks Related to Government Approvals

We are subject to extensive government regulation, and we or our
collaborators may not obtain necessary regulatory approvals.

The research, development, manufacture, marketing, and sale of our
reagents and product candidates manufactured using our technologies are subject
to significant, but varying, degrees of regulation by a number of government
authorities in the U.S. and other countries.

Pharmaceutical product candidates manufactured using our technologies
must undergo an extensive regulatory approval process before commercialization.
This process is regulated by the FDA and by comparable agencies in the European
Union and other countries. The U.S. and foreign regulatory agencies have
substantial discretion to terminate clinical trials, require additional testing,
delay or withhold registration and marketing approval, and mandate product
withdrawals. Even if regulatory approvals were obtained, our manufacturing
processes would be subject to continued review by the FDA and other regulatory
authorities. Any later discovery of unknown problems with our products, products
incorporating our technologies, or manufacturing processes could result in
restrictions on such products or manufacturing processes, including potential
withdrawal of the products from the market. In addition, if regulatory
authorities determine that we have not complied with regulations in the research
and development of a product candidate or the manufacture of our reagents, then
we may not obtain necessary approvals to market and sell the product candidate
or reagents.

Neither we nor our collaborators have submitted any product candidates
for marketing approval to the FDA or any other regulatory authority. If any
product candidate manufactured using our technology is submitted for regulatory
approval, it may not receive the approvals necessary for commercialization, the
desired labeling claims, or adequate levels of reimbursement. Any delay in
receiving, or failure to receive, these approvals would adversely affect our
ability to generate product revenues or royalties. In addition, new governmental
regulations may delay or alter regulatory approval of any product candidate
manufactured using our technology. We cannot predict the impact of adverse
governmental action that might arise from future legislative and administrative
action.

The use of hazardous materials in our operations may subject us to
environmental claims or liability.

Our research and development processes involve the controlled use of
hazardous materials, chemicals, and radioactive compounds. We conduct
experiments that are quite common in the biotechnology industry, in which we use
small quantities of chemical hazards, including those that are corrosive, toxic
and flammable, and trace amounts of radioactive materials. The risk of
accidental injury or contamination from these materials cannot be entirely
eliminated. We do not maintain a separate insurance policy for these types of
risks. In the event of an accident or environmental discharge, we may be held
liable for any resulting damages, and any liability could exceed our resources.
We are subject to federal, state, and local laws and regulations governing the
use, storage, handling, and disposal of these materials and specified waste
products. The cost of compliance with these laws and regulations could be
significant.

Third party reimbursement for our collaborators' or our future product
candidates may not be adequate.

Even if regulatory approval is obtained to sell any product candidates
incorporating our technologies, our future revenues, profitability, and access
to capital will be determined in part by the price at which we or our
collaborators can sell such products. There are continuing efforts by
governmental and private third-party payors to contain or reduce the costs of
health care through various means. We expect a number of federal, state, and
foreign proposals to control the cost of drugs through governmental regulation.
We are unsure of the form that any health care reform legislation may take or
what actions federal, state, foreign, and private payors may take in response to
the proposed reforms. Therefore, we cannot predict the effect of any implemented
reform on our business.

Our ability to commercialize our products successfully will depend, in
part, on the extent to which reimbursement for the cost of such products and
related treatments will be available from government health administration
authorities, such as Medicare and Medicaid in the U.S., private health insurers,
and other organizations. Significant uncertainty exists as to the reimbursement
status of newly approved healthcare products, particularly for indications for
which there is no current effective treatment or for which medical care
typically is not

sought. Adequate third-party coverage may not be available to enable us to
maintain price levels sufficient to realize an appropriate return on investment
in product research and development. Inadequate coverage and reimbursement
levels provided by government and third-party payors for use of our or our
collaborators' products may cause these products to fail to achieve market
acceptance and would cause us to lose anticipated revenues and delay achievement
of profitability.

Risks Related to Stock Market

Our stock price may continue to experience fluctuations.

The market prices of securities of thinly traded companies, such as
ours, have historically been highly volatile. For example, in the past 24
months, the price of our common stock reached a low of $5.90 per share in
October 2002 and a high of $47.40 per share in July 2001. During the past 12
months the price of our common stock has traded as low as $5.90 per share and as
high as $32.58 per share. Sales of a substantial number of shares of our common
stock in the public market or the perception that such sales might occur could
adversely affect the market price of our common stock. We have a number of
investors who hold relatively large positions in our securities and several of
these stockholders hold shares that are being registered for resale by this
registration statement. A decision by any of these investors to sell all or a
block of their holdings of our common stock could cause our stock price to drop
significantly.

The market also continues to experience significant price and volume
fluctuations, many of which are unrelated to the operating performance of
particular companies. In recent years, the price of our common stock has
fluctuated significantly and may continue to do so in the future. If we raise
additional capital by issuing equity securities in a fluctuating market, many or
all of our existing stockholders may experience substantial dilution. If any of
the risks described in these "RISK FACTORS" occurred, or if any unforeseen risk
affected our performance, it could have a dramatic and adverse impact on the
market price of our common stock.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

Some of the statements in the sections entitled "Who We Are", "Risk
Factors", and elsewhere in this prospectus constitute forward-looking
statements. These statements involve known and unknown risks, uncertainties, and
other factors that may cause our or our industry's results, levels of activity,
performance, or achievements to be materially different from any future results,
levels of activity, performance, or achievements expressed or implied by such
forward-looking statements. Such factors include, among others, those listed
under "Risk Factors" and elsewhere in this prospectus. In some cases, you can
identify forward-looking statements by terminology such as "may", "will",
"should", "intend", "expect", "plan", "anticipate", "believe", "estimate",
"predict", "potential", or "continue" or the negative of such terms or other
comparable terminology.

Although we believe that the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee future results,
events, levels of activity, performance, or achievements. We do not assume
responsibility for the accuracy and completeness of the forward-looking
statements. We do not intend to update any of the forward-looking statements
after the date of this prospectus to conform them to actual results, except as
required by the federal securities laws.

USE OF PROCEEDS

We will not receive any proceeds from the sale by the selling
stockholders of our common stock. The selling stockholders will receive all of
the net proceeds from the sale of the shares.

SELLING STOCKHOLDERS

We issued 2,866,763 shares of our common stock to the selling
stockholders under the terms of the common stock purchase agreement dated
February 13, 2003.

We do not know when or in what amounts the selling stockholders may
offer shares for sale. The selling stockholders may choose not to sell some or
all of the shares offered by this prospectus. We may amend or supplement this
prospectus from time to time to update the disclosure set forth herein. Because
the selling stockholders may from time to time offer all or some of the shares
pursuant to this offering, and because there are currently no agreements,
arrangements or understandings with respect to the sale of any of the shares
that will be held by the selling stockholders after completion of the offering,
we cannot estimate the number of the shares that will be held by the selling
stockholders after completion of the offering. However, for purposes of the
table below, we have assumed that, after completion of the offering, none of the
shares offered by this prospectus will be held by the selling stockholders.

The following table sets forth, to our knowledge, certain information
regarding the beneficial ownership of the shares of common stock by the selling
stockholders as of March 14, 2003. We prepared this table based on the number of
shares acquired by each selling stockholder named in the table pursuant to the
terms of the common stock purchase agreement and other publicly available
information. Beneficial ownership is calculated based upon SEC requirements and
is not necessarily indicative of beneficial ownership for any other purpose.
Under these requirements, more than one person may be deemed to be a beneficial
owner of the same shares. Unless otherwise indicated below, the selling
stockholders named in this table have sole voting and investment power with
respect to all shares beneficially owned. Pursuant to Rule 416 under the
Securities Act of 1933, the registration statement of which this prospectus is a
part also covers any additional shares of our common stock which become issuable
in connection with such shares because of any stock dividend, stock split,
recapitalization or other similar transaction effected without the receipt of
consideration which results in an increase in the number of outstanding shares
of our common stock. The table is based on 17,207,766 shares of our common
stock outstanding as of March 14, 2003.

Shares Number of Shares
Beneficially Owned Shares Beneficially Owned
Name of Selling stockholders Prior to Offering Being Offered After Offering
----------------- ------------- --------------
Number Percentage Number Percent

Black Bear Fund I, L.P. 889,228 (1) 5.2% 98,928 790,300 4.6%
Black Bear Fund II, L.L.C. 107,930 (1) * 16,430 91,500 0.5%
Black Bear Offshore Master Fund Limited 1,936,008 (1) 11.3% 301,308 1,634,700 9.5%
Caduceus Capital Trust 122,417 * 122,417 0 0
Caduceus Capital II, L.P. 59,583 * 59,583 0 0
PW Eucalyptus Fund, L.L.C. 134,333 * 134,333 0 0
PW Eucalyptus Fund, Ltd. 17,333 * 17,333 0 0
George W. Haywood 1,588,866 (2) 9.2% 166,666 1,422,200 8.3%
Domain Partners V, L.P. 927,848 (3) 5.4% 927,848 0 0
DP V Associates, L.P. 21,918 (3) * 21,918 0 0
Royal Bank of Canada 416,666 2.4% 416,666 0 0
BayStar Capital II, LP 225,000 1.3% 225,000 0 0
BayStar International II Ltd 25,000 * 25,000 0 0
Kopp Emerging Growth Fund 333,333 (4) 1.9% 333,333 0 0
TOTAL 6,805,463 39.5% 2,866,763 3,938,700 22.9%

-------------------------------
* Less than 1 percent.

(1) The number of shares is based upon a Schedule 13G filed February 13, 2003
by Eastbourne Capital Management, LLC, supplemental information provided to
the Company by Eastbourne Capital Management, LLC, and the number of shares
acquired pursuant to the common stock purchase agreement. The number of
shares does not include any shares beneficially owned by Eastbourne Capital
Management, LLC as each of Black Bear Offshore Master Fund Ltd., Black Bear
Fund I, L.P., and Black Bear Fund II, L.L.C. disclaim beneficial ownership
of any shares not held directly by such entity.

(2) The number of shares is based upon a Schedule 13G filed January 8, 2003 and
the number of shares acquired pursuant to the common stock purchase
agreement. Such 13G indicates that the number of shares includes (i) 3,545
shares owned by Mr. Haywood's minor children, which children would have the
right to the receipt of dividends from, and the proceeds from the sale of,
such shares; (ii) 8,200 shares owned by Mr. Haywood's spouse, which spouse
would have the right to the receipt of dividends from and proceeds for the
sale of such shares; and (iii) 16,000 shares owned jointly by Mr. Haywood
and his mother.

(3) Number of shares is based upon a Schedule 13D filed February 24, 2003.

(4) Does not include any shares which may be deemed to be beneficially owned by
Kopp Investment Advisors, Inc.

PLAN OF DISTRIBUTION

The shares covered by this prospectus may be offered and sold from time
to time by the selling stockholders. The term "selling stockholders" includes
pledgees, donees, transferees or other successors in interest selling shares
received after the date of this prospectus from the selling stockholders as a
pledge, gift, partnership distribution or other non-sale related transfer. To
the extent required, we may amend and supplement this prospectus from time to
time to describe a specific plan of distribution.

The selling stockholders will act independently of us in making
decisions with respect to the timing, manner and size of each sale. The selling
stockholders may make these sales at prices and under terms then prevailing or
at prices related to the then current market price. The selling stockholders may
also make sales in negotiated transactions. The selling stockholders may offer
their shares from time to time pursuant to one or more of the following methods:

- purchases by a broker-dealer as principal and resale by such
broker-dealer for its own account pursuant to this prospectus;

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

- one or more block trades in which the broker-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;

- on the Nasdaq National Market (or through the facilities of any
national securities exchange or U.S. inter-dealer quotation
system of a registered national securities association, on which
the shares are then listed, admitted to unlisted trading
privileges or included for quotation);

- through underwriters, brokers or dealers (who may act as agents
or principals) or directly to one or more purchasers;

- through agents; and

- in public or privately negotiated transactions.

In connection with distributions of the shares or otherwise, the
selling stockholders may:

- enter into hedging transactions with broker-dealers or other
financial institutions, which may in turn engage in short sales
of the shares in the course of hedging the positions they assume;

- sell the shares short and redeliver the shares to close out such
short positions;

- enter into option or other transactions with broker-dealers or
other financial institutions which require the delivery to them
of shares offered by this prospectus, which they may in turn
resell; and

- pledge shares to a broker-dealer or other financial institution,
which, upon a default, they may in turn resell.

In addition to the foregoing methods, the selling stockholders may
offer their shares from time to time in transactions involving principals or
brokers not otherwise contemplated above, in a combination of such methods
described above or any other lawful methods.

In addition, the selling stockholders may sell all or a portion of the
shares that qualify for sale pursuant to Rule 144 of the Securities Act of 1933
under Rule 144 rather than pursuant to this prospectus.

Sales through brokers may be made by any method of trading authorized
by any stock exchange or market on which the shares may be listed or quoted,
including block trading in negotiated transactions. Without limiting the
foregoing, such brokers may act as dealers by purchasing any or all of the
shares covered by this prospectus, either as agents for others or as principals
for their own accounts, and reselling such shares pursuant to this prospectus.
The selling stockholders may effect such transactions directly, or indirectly
through underwriters, broker-dealers or agents acting on their behalf. In
effecting sales, broker-dealers or agents engaged by the selling stockholders
may arrange for other broker-dealers to participate. Broker-dealers or agents
may receive commissions, discounts or concessions from the selling stockholders,
in amounts to be negotiated immediately prior to the sale (which compensation as
to a particular broker-dealer might be in excess of customary commissions for
routine market transactions).

In offering the shares covered by this prospectus, the selling
stockholders, and any broker-dealers and any other participating broker-dealers
who execute sales for the selling stockholders, may be deemed to be
"underwriters" within the meaning of the Securities Act of 1933 in connection
with these sales. Any profits realized by the selling stockholders and the
compensation of such broker-dealers may be deemed to be underwriting discounts
and commissions.

In order to comply with the securities laws of certain states, the
shares must be sold in those states only through registered or licensed brokers
or dealers. In addition, in certain states the shares may not be sold unless
they have been registered or qualified for sale in the applicable state or an
exemption from the registration or qualification requirement is available and is
complied with.

We have advised the selling stockholders that the anti-manipulation
rules of Regulation M under the Securities Exchange Act of 1934, as amended, may
apply to sales of shares in the market and to the activities of the selling
stockholders and its affiliates. In addition, we will make copies of this
prospectus available to the selling stockholders for the purpose of satisfying
the prospectus delivery requirements of the Securities Act. The selling
stockholders may indemnify any broker-dealer that participates in transactions
involving the sale of the shares against certain liabilities, including
liabilities arising under the Securities Act.

At the time a particular offer of shares is made, if required, we will
distribute a prospectus supplement that will set forth:

- the number of shares being offered;

- the terms of the offering, including the name of any selling
stockholders, underwriter, broker, dealer or agent;

- the purchase price paid by any underwriter;

- any discount, commission and other underwriter compensation;

- any discount, commission or concession allowed or reallowed or
paid to any dealer;

- the proposed selling price to the public; and

- other facts material to the transaction.

In addition, if we are notified by the selling stockholders that a
donee, pledgee, transferee or other successor-in-interest intends to sell more
than 500 shares, a supplement to this prospectus will be filed.

We have agreed to indemnify the selling stockholders against certain
liabilities, including certain liabilities under the Securities Act.

We have agreed with the selling stockholders to keep the registration
statement of which this prospectus constitutes a part effective until the
earlier of (i) such time as all of common shares registered hereby have been
disposed of in accordance with the intended methods of disposition by the
selling stockholders, (ii) such date on which each of the selling stockholders
may dispose of all of the common shares registered hereby in one transaction in
the open market pursuant to Rule 144(k) under the Securities Act, or (iii) two
years from the effective date of this registration statement.

All costs, expenses and fees in connection with the registration of the
shares offered hereby will be borne by us. Brokerage commissions and similar
selling expenses, if any, attributable to the sale of shares will be borne by
the selling stockholders.

LEGAL MATTERS

The validity of the shares of our common stock offered by this
prospectus will be passed upon for us by Pepper Hamilton LLP, Philadelphia,
Pennsylvania.

EXPERTS

The financial statements of Neose Technologies, Inc. as of December 31,
2002 and for the year then ended, have been incorporated by reference herein and
elsewhere in the registration statement on Form S-3 of which this prospectus
forms a part, in reliance upon the report of KPMG LLP, independent accountants,
incorporated by reference herein, and upon the authority of said firm as experts
in accounting and auditing.

The financial statements incorporated by reference in this registration
statement on Form S-3 of which this prospectus forms a part as of December 31,
2001 and for the years ended December 31, 2001 and 2000 and for the period from
January 17, 1989 (inception) through December 31, 2001 have been incorporated by
reference in reliance on the report of Arthur Andersen LLP, independent public
accountants, given on the authority of said firm as experts in auditing and
accounting.

Effective April 29, 2002, the Company's Board of Directors approved the
dismissal of Andersen as the Company's independent auditors and the appointment
of KPMG LLP to serve as the Company's independent auditors. After reasonable
efforts, the Registrant has not been able to obtain the written consent of
Arthur Andersen LLP to the incorporation by reference of its report into this
Registration Statement. The Registrant has dispensed with the requirement to
file the written consent of Arthur Andersen LLP in reliance on Rule 437a
promulgated under the Securities Act of 1933, as amended (the "Securities Act").
Since the Registrant has not been able to obtain the written consent of Arthur
Andersen LLP, you will not be able to recover against Arthur Andersen LLP under
Section 11 of the Securities Act for any untrue statements of material fact
contained in the financial statements audited by Arthur Andersen LLP
incorporated by reference herein or any omissions to state a material fact
required to be stated therein.

ADDITIONAL INFORMATION

This prospectus is part of a registration statement we have filed with
the Securities and Exchange Commission. This prospectus does not contain all of
the information contained in the registration statement or the exhibits to the
registration statement. For further information about us, please see the
complete registration statement. Summaries of agreements or other documents in
this prospectus are not necessarily complete. Please refer to the exhibits to
the registration statement for complete copies of these documents.

We are subject to the information requirements of the Securities
Exchange Act of 1934, as amended and file reports, proxy statements and other
information with the SEC. You may read and copy such reports, proxy statements
and other information, including the registration statements and all of their
exhibits, at the SEC public reference room at:

450 Fifth Street, N.W.
Judiciary Plaza
Room 1024
Washington, D.C. 20549

You may obtain information on the operation of the SEC public reference
room in Washington, D.C. by calling the SEC at 1-800-SEC-0330. Our SEC filings,
including the registration statement of which this prospectus forms a part and
the documents incorporated by reference that are listed below, are also
available from the SEC's Web site at http://www.sec.gov, which contains reports,
proxy and information statements and other information regarding issuers that
file electronically.

The SEC allows us to "incorporate by reference" into this prospectus
certain information that we file with it. This means that we can disclose
important information to you by referring you to another document that we filed
separately with the SEC. The information incorporated by reference is deemed to
be part of this prospectus, except for any information superseded by information
in this prospectus. You should read the information incorporated by reference
because it is an important part of this prospectus.

We incorporate by reference the following documents that we previously
filed with the SEC pursuant to the Exchange Act and any future filings we will
make with the SEC under Section 13(a), 13(c), 14 or 15(d) of the Exchange Act:

1. Our Annual Report on Form 10-K for the year ended December 31,
2002;

2. Our Current Reports on Form 8-K filed on January 7, 2003, January
8, 2003, February 14, 2003 and two filed on April 29, 2003;

3. The description of our common stock contained in the Registration
Statement on Form 8-A filed with the Securities and Exchange
Commission on February 7, 1996; and

4. The description of rights to purchase preferred shares contained
in the Registration Statement on Form 8-A filed with the
Securities and Exchange Commission on October 1, 1997.

If you request, either orally or in writing, we will provide you with a
copy of any or all documents which are incorporated by reference. We will
provide such documents to you free of charge, but will not include any exhibits,
unless those exhibits are incorporated by reference into the document. You
should address written requests for documents to Debra J. Poul, Senior Vice
President and General Counsel, Neose Technologies, Inc., 102 Witmer Road,
Horsham, Pennsylvania 19044, (215) 315-9000.

We undertake no obligation to publicly update any forward-looking
statements, whether as a result of new information, future events or otherwise.
You are advised, however, to consult any further disclosures we make on related
subjects in our 10-Q, 8-K and 10-K reports to the SEC. Also note that we provide
a cautionary discussion of

risks and uncertainties relevant to our business in the "Risk Factors" section
of this prospectus. These are factors that we think could cause our actual
results to differ materially from expected results. Other factors besides those
listed here could also adversely affect us. This discussion is provided as
permitted by the Private Securities Litigation Reform Act of 1995.

Part II

Information Not Required In Prospectus

Item 14. Other Expenses of Issuance and Distribution

The following table sets forth the various expenses in connection with
the sale and distribution of the securities being registered. All of the amounts
shown are estimates except the Securities and Exchange Commission registration
fee.

SEC registration fee ..................................... $ 1,559
Legal fees and expenses .................................. $10,000
Accounting fees and expenses ............................. $ 3,500
Miscellaneous fees and expenses .......................... $ 5,000
TOTAL ........................................... $20,059

Item 15. Indemnification of Directors and Officers

Section 145 of the Delaware General Corporation Law ("Section 145")
permits a corporation to indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative, by
reason of the fact that he is or was a director, officer or agent of the
corporation or another enterprise if serving at the request of the corporation.
Depending on the character of the proceeding, a corporation may indemnify
against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred in connection with such action,
suit or proceeding if the person indemnified acted in good faith and, in respect
to any criminal action or proceeding, had no reasonable cause to believe his
conduct was unlawful. In the case of an action by or in the right of the
corporation, no indemnification may be made with respect to any claim, issue or
matter as to which such person shall have been adjudged to be liable to the
corporation unless and only to the extent that the Court of Chancery or the
court in which such action or suit was brought shall determine that, despite the
adjudication of liability, such person is fairly and reasonably entitled to
indemnity for such expenses which the court shall deem proper. Section 145
further provides that to the extent a director, officer, employee or agent of a
corporation has been successful in the defense of any action, suit or proceeding
referred to above, or in the defense of any claim, issue or matter therein, he
shall be indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection therewith.

The Certificate of Incorporation of Neose limits the personal liability
of directors to Neose or any of its stockholders for monetary damages for breach
of fiduciary duty as a director, provided, however, that this limitation does
not apply to any liability of a director (i) for any breach of the director's
duty of loyalty to Neose or its stockholders, (ii) for acts or omissions not in
good faith or which involve intentional misconduct or a knowing violation of
law, (iii) under Section 174 of Title 8 of the General Corporation Law of
Delaware, or (iv) for any transaction from which the director derived an
improper personal benefit.

Section 6 of Article 7 of Neose's second amended and restated by-laws
provides to the fullest extent permitted by Section 145 for the indemnification
of each person who was or is a party or is threatened to be made a party to any
threatened, pending, or completed action, suit, or proceeding, whether civil,
criminal, administrative, or investigative, by reason of the fact that he or she
is or was, or has agreed to become, a director or officer of the corporation, or
is or was serving, or has agreed to serve, at the request of the corporation, as
a director, officer, or trustee of, or in a similar capacity with, another
corporation, partnership, joint venture, trust, or other enterprise (including
any employee benefit plan), or by reason of any action alleged to have been
taken or omitted in such capacity, against all expenses (including attorneys'
fees), judgments, fines, and amounts paid in settlement actually and reasonably
incurred by such person or on such person's behalf in connection with such
action, suit, or proceeding and any appeal therefrom.

II-1

Item 16. List of Exhibits

The exhibits filed as part of this registration statement are as
follows:

Exhibit Description
---------------- -----------------------------------------------------------

5.1* Opinion of Pepper Hamilton LLP regarding legality of
securities being registered.
10.1(1) Common Stock Purchase Agreement
23.1# Consent of KPMG LLP.
23.2 Consent of Pepper Hamilton LLP (included in its Opinion
filed as Exhibit 5.1 hereto).
24.1* Powers of Attorney (included on signature page).
* Filed with the initial registration statement on March 18, 2003.
# Filed herewith.

(1) Incorporated by reference to Exhibit 10.36 to the Annual Report on Form
10-K filed on March 17, 2003.

Item 17. Undertakings

The undersigned registrant hereby undertakes:

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

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

(ii) To 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) which,
individually or in the aggregate, represent a
fundamental change in the information set forth in
the registration statement. Notwithstanding the
foregoing, any increase or decrease in the volume of
the securities offered (if the total dollar value of
securities offered would not exceed that which was
registered) and any deviation form the low or high
end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent
no more than 20 percent change in the maximum
aggregate offering price set forth in the
"Calculation of Registration Fee" table in the
effective registration statement; and

(iii) To 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) above do
not apply if the registration statement is on Form S-3 or
Form S-8 and the information required to be included in a
post-effective amendment by those paragraphs is contained
in periodic reports filed by the registrant pursuant to
Section 13 or Section 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, 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.

The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be

II-2

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.

Insofar as indemnification for liabilities arising under the
Securities Act of 1933 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 Securities and Exchange
Commission such indemnification is against public policy as expressed in the 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 of whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.

II-3

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Neose
Technologies, Inc. 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
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized in Horsham, Pennsylvania on May 2, 2003.

Neose Technologies, Inc.

By: /s/ C. Boyd Clarke
--------------------
C. Boyd Clarke
Chief Executive Officer

Signature Title Date
---------------------------------------- --------------------------------------------------- ---------------------------

/s/ * President, Chief Executive Officer (Principal May 2, 2003
-----------------------------
C. Boyd Clarke Executive Officer) and Director

/s/ * Senior Vice President and Chief Financial Officer May 2, 2003
-----------------------------
Robert I. Kriebel (Principal Financial Officer)

/s/ * Director May 2, 2003
-----------------------------
L. Patrick Gage

/s/ * Director May 2, 2003
-----------------------------
William F. Hamilton

/s/ * Director May 2, 2003
-----------------------------
Douglas J. McMaster, Jr.

/s/ * Director May 2, 2003
-----------------------------
P. Sherrill Neff

/s/ * Director May 2, 2003
-----------------------------
Mark H. Rachesky

/s/ * Chairman of the Board of Directors May 2, 2003
-----------------------------
Stephen A. Roth

II-4

/s/ * Director May 2, 2003
-------------------------
Lowell E. Sears

/s/ * Director May 2, 2003
-------------------------
Elizabeth H. S. Wyatt

* By /s/ Debra J. Poul
-------------------------
Debra J. Poul
Attorney in Fact

II-5

Exhibit Index

Exhibit Description
-------------- -----------------------------------------------------------

(1) Incorporated by reference to Exhibit 10.36 to the Annual Report on Form 10-K
filed on March 17, 2003.