Edgar Filing: Ampio Pharmaceuticals, Inc.

Large accelerated filer

Accelerated filer

Non-accelerated filer

¨ (Do not check if a smaller reporting company)

Smaller reporting company

Form S-4

As filed with the Securities and Exchange Commission on January 6, 2011.

Registration No. 333- .

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM S-4

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

AMPIO PHARMACEUTICALS, INC.

(Exact name of registrant as specified in its charter)

Delaware

2834

26-0179592

(State or other jurisdiction of

incorporation or organization)

(Primary Standard Industrial

Classification Code Number)

(I.R.S. Employer

Identification No.)

5445 DTC Parkway, P4

Greenwood Village, Colorado 80111

(303) 418-1000

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

Donald B. Wingerter, Jr.

Chief Executive Officer

Ampio Pharmaceuticals, Inc.

5445 DTC Parkway, P4

Greenwood Village, Colorado 80111

(303) 418-1000

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

Copies to:

Robert W. Walter, Esq.

Richardson & Patel, LLP

10900 Wilshire Boulevard, Suite 500

Los Angeles, California 90024

(310) 208-1182

(310) 208-1154 — Facsimile

Approximate date of commencement of proposed sale to the public:

As soon as practicable after the effective date of this registration statement.

If the securities being registered on this form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box. ¨

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement from 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. ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:

Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer) ¨

Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer) ¨

CALCULATION OF REGISTRATION FEE



Title of Each Class of Securities to be Registered	Amount to be Registered⁽¹⁾	Proposed Maximum Offering Price Per Share	Proposed Maximum Aggregate Offering Price⁽²⁾	Amount of Registration Fee
Common Stock, par value $0.0001 per share	8,667,905	N/A	$5,758,495	$669

(1)

Represents the fixed number of shares of common stock of the registrant to be issued in connection with the proposed merger of DMI BioSciences, Inc. (“BioSciences”) with and into a wholly-owned subsidiary of the registrant as described herein. The fixed number of shares of common stock includes Ampio common stock issuable in cancellation of “in-the-money” BioSciences stock options and warrants and two outstanding BioSciences promissory notes. In accordance with Rule 416 under the Securities Act of 1933, as amended (“Securities Act”), this Registration Statement also shall register any additional shares of common stock of the Registrant which may become issuable to prevent dilution resulting from stock splits, stock dividends, or similar transactions as provided by agreement relating to the merger.

(2)

Estimated solely for the purpose of calculating the amount of the registration fee pursuant to Rule 457(f)(2) under the Securities Act of 1933, as amended (the “Securities Act”). BioSciences is a private company and, since no market exists for its equity securities and BioSciences has an accumulated capital deficit, the proposed maximum aggregate offering price is based upon one-third of the stated value of the BioSciences’ common stock to be cancelled in the merger. The aggregate stated value of the BioSciences’ Class A and Class B common stock was $17,275,484 at September 30, 2010. The amount presented is one-third of this stated value.

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, as amended, or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

The information in this information statement/prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This information statement/prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities in any jurisdiction where an offer, solicitation or sale is not permitted.

SUBJECT TO COMPLETION, DATED JANUARY 6, 2011

LOGO

PRELIMINARY INFORMATION STATEMENT/PROSPECTUS

We are pleased to report that the board of directors of DMI BioSciences, Inc., or BioSciences, as well as the board of directors and the holders of a majority of the outstanding shares of common stock of Ampio Pharmaceuticals, Inc., or Ampio, have approved an amended merger agreement that will result in the merger of Ampio Acquisition, Inc., or the Merger Sub, a wholly-owned subsidiary of Ampio, with and into BioSciences. As a result, BioSciences will become a wholly-owned subsidiary of Ampio. The aggregate consideration that will be paid by Ampio to BioSciences shareholders will be 8,667,905 shares of Ampio common stock, which we refer to as the Merger Stock. This consideration includes the shares of Merger Stock that will be issued to holders of in-the-money BioSciences stock options and warrants, and holders of two promissory notes, outstanding immediately prior to the effective time of the merger. Ampio common stock is quoted on the OTC Bulletin Board under the symbol “AMPE.” On December 31, 2010, the last reported sale price of the Ampio common stock on the OTC Bulletin Board was $2.40 per share.

Ampio will deliver to holders of BioSciences in-the-money stock options and warrants an aggregate of 405,066 shares out of the 8,667,905 shares of Merger Stock. In addition, Ampio will deliver to holders of two BioSciences promissory notes an aggregate of 500,000 shares of Merger Stock in extinguishment of the notes. The remaining 7,762,839 shares of Merger Stock will be issued to the holders of BioSciences common stock pro rata. At the date hereof, BioSciences had 17,975,587 shares of common stock outstanding, of which 9,171,282 shares are Class A common stock and 8,804,305 shares are Class B common stock. The 8,804,305 shares of BioSciences Class B common stock are owned in their entirety by present and former executive officers and directors of BioSciences. These individuals have entered into a donation to capital agreement under which the 8,804,305 shares of Class B common stock owned by them will be voluntarily donated to the capital of BioSciences by such persons immediately prior to the effective time of the merger. The net effect of this donation to capital will be to decrease the total number of BioSciences shares of common stock outstanding from 17,975,587 shares to 9,171,282 shares. Based on the closing price of Ampio common stock of $2.40 on December 31, 2010, the 7,762,839 shares of Merger Stock to be issued to the BioSciences shareholders represented approximately $2.03 in value for each share of the 9,171,282 BioSciences Class A shares of common stock outstanding that will be received by Ampio in the merger.

The following table summarizes the expected distribution of the Merger Stock to be issued in connection with the proposed Merger and the ownership of the combined company after the merger (i) assuming the closing of the merger, (ii) assuming no BioSciences stock options or warrants are exercised between December 31, 2010 and the closing, (iii) giving effect to the donation to Ampio’s capital of 3,500,000 shares of Ampio common stock now owned by BioSciences, and (iv) giving effect to the donation to BioSciences capital of all outstanding Class B BioSciences shares of common stock immediately prior to the closing of the merger.


			Percentage of
Category of Holder	Number of Shares		Merger Stock			Combined Company¹
Holders of Class A BioSciences common stock		7,762,839		89.6	%		30.1	%
Holders of Class B BioSciences common stock		0		—			—
Holders of “in-the-money” BioSciences stock options and warrants		405,066		4.6	%		1.6	%
Holders of two BioSciences promissory notes		500,000		5.8	%		1.9	%

Total		8,667,905		100.0	%		33.6	%

Based upon 17,107,036 outstanding Ampio shares of common stock on December 31, 2010. Excludes Ampio common stock issuable on conversion of outstanding Ampio debentures, exercise of outstanding Ampio stock options and warrants, and the exercise of Ampio warrants to be issued in exchange for outstanding BioSciences warrants, as described herein.

Based on 7,762,839 shares of Merger Stock to be issued in consideration of the 9,171,282 shares of BioSciences that are expected to be outstanding at closing, we estimate the exchange ratio will be .84643 of an Ampio share of common stock for each BioSciences share of common stock. If a BioSciences option is “out-of-the-money,” then Ampio will issue a replacement Ampio stock option with an exercise period identical to that in the BioSciences stock option, with the exercise price and number of underlying shares adjusted in accordance with the exchange ratio.

The amount of merger consideration to be received by BioSciences shareholders may fluctuate between the date of this information statement/prospectus and the closing of the merger as a result of changes in the market price for Ampio common stock, the total number of shares of BioSciences common stock outstanding at closing, and the total number and exercise prices of BioSciences stock options and warrants outstanding at closing.

As a condition to Ampio and Merger Sub entering into the merger agreement, a meeting of BioSciences shareholders was held in September 2010 at which shareholders holding 14,293,368 BioSciences shares of common stock voted in favor of the Merger, no shares voted against the merger, and one BioSciences shareholder holding 25,835 shares abstained. BioSciences was organized in 1990 and currently has 191 shareholders. In conjunction with the planned merger, BioSciences circulated purchaser questionnaires to its shareholders, a majority of which were returned to BioSciences in October and early November 2010. By November 2010, 64 BioSciences shareholders had identified themselves as non-accredited investors, 49 BioSciences shareholders had not returned their purchaser questionnaires, and 78 BioSciences shareholders had identified themselves as accredited investors. Due to the actual and potential number of non-accredited investors in BioSciences, Ampio concluded that it could not rely on an exemption from the registration requirements of the federal securities laws in issuing the Merger Stock. As a result, Ampio is registering hereby the Merger Stock that will be issued to the BioSciences shareholders at closing.

On December 31, 2010, the parties amended the merger agreement to provide that (i) BioSciences will hold another shareholder meeting or obtain the written consent of holders of at least 66²/3% of the BioSciences shareholders (the “BioSciences Major Shareholders”) adopting the merger agreement and approving the merger and the other transactions contemplated thereby, (ii) the merger closing will occur only after BioSciences provided a proxy or information statement to its shareholders, the Merger Stock is registered, and BioSciences shareholders not a party to an agreement to execute a BioSciences shareholder consent are provided again the right to exercise dissenters’ rights, (iii) the September 2010 BioSciences shareholder meeting vote in favor of the merger would be treated by the parties for all purposes under the merger agreement as non-binding, null and void, (iv) notwithstanding any prior approval of the merger agreement by the boards of directors and shareholders of the entities that were party to the merger agreement, the amended merger agreement would take effect only upon approval by the boards of directors of Ampio, BioSciences, and Merger Sub, approval by written consent of Ampio shareholders holding a majority of outstanding Ampio shares of common stock (the “Ampio Majority Shareholders”), and approval at a meeting or by consent of at least 66²/3% of the BioSciences shareholders. The boards of directors of both companies approved the amended merger agreement effective December 31, 2010. Because the BioSciences Major Shareholders have agreed to sign the written shareholders’ consent adopting the merger agreement and approving the proposed merger and the other transactions contemplated thereby, we are not soliciting proxies or consents from BioSciences shareholders and BioSciences will not be holding a shareholders’ meeting to approve the merger. We intend to send a notice of action taken by the Ampio Majority Shareholders once the Majority Shareholders act by consent to approve the amended merger agreement.

This information statement/prospectus constitutes a written notice from BioSciences to the BioSciences shareholders that the BioSciences Major Shareholders, who in the aggregate own 13,543,233 shares of common stock of BioSciences, or 73.5% of the outstanding BioSciences shares of common stock, have agreed to consent to the adoption of the merger agreement, as amended, and will approve the proposed merger and other transactions contemplated thereby.

This information statement/prospectus constitutes written notice pursuant to Article 113 of the Colorado Business Corporation Act that certain BioSciences shareholders are entitled to assert dissenters’ rights under Article 113 of the Colorado Business Corporation Act. A copy of Article 113 is included with this Notice and should be read carefully by BioSciences shareholders. BioSciences shareholders that will be party to the consent approving the amended merger agreement have expressly waived their right to exercise dissenters’ rights.

We are not asking you for a proxy and you are requested not to send us a proxy.

Please see “Risk Factors” beginning on page 13 for a discussion of matters relating to holding

Ampio common stock.

Neither the Securities and Exchange Commission nor any state securities commission has approved or

disapproved of the common stock to be issued by Ampio under this information statement/prospectus or

passed on the adequacy or accuracy of this information statement/prospectus. Any representation to the

contrary is a criminal offense.

This information statement/prospectus is dated [—][—], 2011, and is first being mailed to BioSciences shareholders on or about [—][—], 2011.

AVAILABLE INFORMATION

This document, which is sometimes referred to as the information statement/prospectus, constitutes an information statement of BioSciences and a prospectus of Ampio for the shares of Ampio Merger Stock that Ampio will issue to holders of BioSciences Class A common stock in the merger. As permitted under the rules of the U.S. Securities and Exchange Commission (the “SEC”), this information statement/prospectus refers to important business and financial information about Ampio that is contained in documents filed with the SEC and that is not included in or delivered with this information statement/prospectus. You may obtain copies of these documents, without charge, from the Internet website maintained by the SEC at www.sec.gov, as well as other sources. See “Where You Can Find More Information” beginning on page 93. You may also obtain copies of these documents, without charge, from Ampio by writing, calling or emailing:

Investor Relations

Ampio Pharmaceuticals, Inc.

5445 DTC Parkway, P4

Greenwood Village, Colorado 80111

(303) 418-1000

bmiller@ampiopharma.com

In order to obtain delivery of these documents prior to completion of the merger, you should request such documents no later than , 2011.

Except as the context otherwise requires, references to “us,” “we” or “our” refer collectively to both Ampio and BioSciences and each company’s subsidiaries. References to “BioSciences” mean DMI BioSciences, Inc., and references to “Life Sciences” mean DMI Life Sciences, Inc., which is our predecessor for accounting purposes and now a wholly-owned subsidiary of ours.

In “Questions and Answers About the Merger” below and in the “Summary” beginning on page , we highlight selected information from this information statement/prospectus, but we have not included all of the information that may be important to you. To better understand the merger agreement and the merger, and for a complete description of their legal terms, you should carefully read this entire information statement/prospectus, including the annexes, as well as the documents that Ampio has described in this information statement/prospectus that are on file with the SEC. See “Where You Can Find More Information” on page .

This information statement/prospectus is dated [—][—], 2011, and you should assume that the information contained herein is accurate only as of such date. You also should assume that annexes or other documents filed by Ampio with the SEC are accurate as of the date of such document. Neither the mailing of this information statement/prospectus to the BioSciences shareholders, nor the issuance by Ampio of shares of Ampio common stock in connection with the merger will create any implication that there has been no change in the affairs of BioSciences or Ampio since the date of this information statement/prospectus or that the information in this information statement/prospectus or in the documents incorporated herein by reference is correct as of any time subsequent to the date hereof or the dates thereof.

This information statement/prospectus includes trademarks, such as Optina, Ampion, Vasaloc and Zertane, which are protected under applicable intellectual property laws and are our property or the property of our subsidiaries. This information statement/prospectus also contains trademarks, service marks, copyrights and trade names of other companies which are the property of their respective owners. Solely for convenience, our trademarks and tradenames referred to in this information statement/prospectus may appear without the ^® or ™ symbols, but such references are not intended to indicate in any way that we will not assert, to the fullest extent under applicable law, our rights to these trademarks and tradenames.

For investors outside the United States, we have not done anything that would permit this offering or possession or distribution of this information statement/prospectus in any jurisdiction where action for that purpose is required, other than the United States. You are required to inform yourselves about and to observe any restrictions.

This information statement/prospectus does not cover any resales of the Ampio common stock offered hereby to shareholders of BioSciences who are deemed to be “affiliates” of Ampio upon the consummation of the merger. No such affiliate is authorized to make use of this information statement/prospectus in connection with any such resales.

TABLE OF CONTENTS


	Page
Questions and Answers About the Merger		1
Summary		5
Comparative Stock Prices and Dividends		11
Risk Factors		13
Cautionary Statement Concerning Forward-Looking Statements		31
Selected Historical Consolidated Financial Data of Ampio		32
Selected Historical Consolidated Financial Data of BioSciences		34
Summary Selected Unaudited Pro Forma Consolidated Combined Financial Data		36
Management’s Discussion and Analysis of Financial Condition and Results of Operations—Ampio		39
Management’s Discussion and Analysis of Financial Condition and Results of Operations—BioSciences		47
The Merger		51
General		51
Merger Consideration		51
Background of the Merger		53
Reasons for the Merger		55
Opinion of Financial Advisor to BioSciences		57
Accounting Treatment of the Merger		61
Beneficial Ownership of BioSciences Common Stock		62
The Merger Agreement		63
Form of the Merger		63
Merger Consideration		63
BioSciences Options and Warrants		63
The Donation to Capital Agreement and the Cancellation Agreement		64
BioSciences Promissory Notes, the Conversion Agreement and the Tag-Along Agreement		64
Conversion of Shares; Procedures for Exchange of Certificates; Fractional Shares		64
Effective Time of the Merger		65
Management and Organizational Documents after the Merger		65
Consent Agreement		65
Indemnification		65
Escrow Fund		66
Shareholders’ Representative		66
Representations and Warranties		66
Covenants		68
Conditions to the Merger		72
Termination		73
Modification or Amendment; Waiver		74
Transaction Fees and Expenses		74
Dissenters’ Rights		75
Information About the Companies		80
Description of Ampio Common Stock		84
Comparison of Rights of Ampio Shareholders and BioSciences Shareholders		88
Where You Can Find More Information		93
Legal Matters		93
Experts		93
Future Shareholder Proposals		94
Miscellaneous		94



Annexes
Annex A –	Amended Agreement and Plan of Merger, dated December 31, 2010, by and among Ampio Pharmaceuticals, Inc., Ampio Acquisition, Inc., DMI BioSciences, Inc. and the Control Shareholders of DMI BioSciences, Inc.	A-1
Annex B –	Opinion of Bluestone Investment Banking Group, LLC	B-1
Annex C –	Additional Information Regarding Ampio Pharmaceuticals, Inc.	C-1
Annex D –	Colorado Dissenters’ Rights Statute	D-1


Annex E –	Consolidated Financial Statements of Ampio Pharmaceuticals, Inc. and Subsidiaries	E-1
Annex F –	Consolidated Financial Statements of DMI BioSciences, Inc. and Subsidiaries	F-1
Annex G –	Unaudited Pro Forma Consolidated Financial Information of Ampio and BioSciences	G-1

You should rely only on the information contained in this document. We have not authorized anyone to provide you with additional or different information from that contained in this information statement/prospectus. If anyone provides you with additional, different or inconsistent information, you should not rely on it. This information statement/prospectus does not constitute an offer to exchange or sell, or a solicitation of an offer to exchange or purchase, any securities, in any jurisdiction to or from any person to whom it is unlawful to make such offer or solicitation in such jurisdiction.

QUESTIONS AND ANSWERS ABOUT THE MERGER

Q:	WHAT IS THE PROPOSED TRANSACTION?

A:	BioSciences has reached an agreement with Ampio pursuant to which Ampio will acquire BioSciences by merging Merger Sub, a wholly-owned subsidiary of Ampio, with and into BioSciences, with BioSciences continuing as the surviving entity.

The aggregate consideration that will be paid by Ampio to BioSciences shareholders in the merger is 8,667,905 shares of Ampio common stock. This consideration includes the consideration payable to holders of in-the-money BioSciences stock options and warrants, and holders of two BioSciences promissory notes, outstanding immediately prior to the effective time of the merger.

The merger agreement, as amended, is included as Annex A to this information statement/prospectus. It is the legal document that governs the merger.

Q:	WHY ARE THE TWO COMPANIES PROPOSING TO MERGE?

The companies have overlapping ownership, management and business interests that make a compelling case for merging the two companies, in the view of the two companies’ boards of directors and senior management. For example, (i) BioSciences currently owns 3,500,000 shares of Ampio common stock, or approximately 20% of the outstanding Ampio shares of common stock, (ii) Ampio’s chief financial officer, Bruce G. Miller, is also the president and a director of BioSciences and a principal Class B shareholder of BioSciences, (iii) Ampio’s chief scientific officer and a director, Dr. David Bar-Or, is a former executive officer and director of BioSciences, and is a principal Class B shareholder of BioSciences, (iv) Richard B. Giles, a shareholder of BioSciences, is a member of the board of directors, shareholder and debenture holder of Ampio, and (v) several Ampio bridge investors are also shareholders of BioSciences. In addition, Ampio’s predecessor, Life Sciences, was formed in December 2008 and acquired in April 2009 from BioSciences all of the intellectual property then owned or licensed by BioSciences with the exception of rights to Zertane. BioSciences’ collaborator cancelled the exclusive license for Zertane in June 2010 and at that time BioSciences regained all rights to Zertane. Because BioSciences has no rights to any other product candidates, BioSciences’ business is now limited to its intent to exploit Zertane. However, BioSciences has very limited financial resources with which to do so, and lacks the executive and other personnel necessary to do so. The BioSciences board of directors considered the foregoing factors and concluded that Ampio’s acquisition of BioSciences would maximize value to BioSciences’ shareholders by providing the opportunity to participate in the growth and opportunities of the combined company. The BioSciences board of directors believes that the merger will allow the combined company to work toward maximizing the value of Zertane, while diversifying beyond Zertane (through the merger) to include an indirect, shareholder interest in the other product candidates previously acquired by Life Sciences. In reaching its conclusion, the BioSciences board of directors considered a variety of factors, including financial and operating information relating to the two companies. To review BioSciences reasons for the merger, please see “The Merger—BioSciences’ Reasons for the Merger” beginning on page 55.

Ampio’s acquisition of BioSciences will advance Ampio’s interests by eliminating the conflicts of interest now existing as a result of overlapping ownership and management with BioSciences, and aligning the interests of shareholders of Ampio and BioSciences. In addition, Ampio will opportunistically seek to obtain new collaborators for Zertane while advancing Ampio’s other product candidates through clinical trials and possible collaboration discussions. To review Ampio’s reasons for the merger, please see “The Merger—Ampio’s Reasons for the Merger” beginning on page 55.

Q:	DO I NEED TO APPROVE THE MERGER?

No. Colorado law allows shareholders to act by written consent instead of holding a meeting. Because shareholders of BioSciences owning 73.5% of the outstanding BioSciences shares of common stock have agreed to sign a written shareholders’ consent adopting the merger agreement and approving the proposed merger and the other transactions contemplated thereby, no vote is required on the part of BioSciences shareholders. We are not asking for a proxy, and you are requested not to send us a proxy.

Q:	WHAT IF I PREVIOUSLY VOTED IN FAVOR OF THE MERGER?

The prior vote will have no effect on the merger and, pursuant to the amended merger agreement, that vote has been deemed advisory in nature, and null and void by the parties. The September 2010 vote at the BioSciences shareholders’ meeting occurred before BioSciences learned that 64 of its shareholders considered themselves to be non-accredited investors, and before 49 BioSciences shareholders failed to return their purchaser questionnaires. Once BioSciences became aware of, and advised Ampio, of these facts, the parties agreed that the Merger Stock had to be registered before its issuance pursuant to the merger agreement, as amended.

Q:	WHAT DOES THE CONSENT AGREEMENT PROVIDE?

As a condition to signing the amended merger agreement, Ampio, BioSciences and shareholders holding 73.5% of the outstanding common stock of BioSciences entered into a consent agreement. The consenting shareholders, each of whom is a current or former BioSciences officer or director (or an entity controlled by such a person) or owner of at least 200,000 shares of BioSciences common stock, has committed to approve the merger once the registration statement that includes this information statement/prospectus is declared effective by the SEC, and a definitive information statement/prospectus is delivered to each BioSciences shareholder, including the consenting shareholders. The consenting shareholders are not legally obligated to, and will not, deliver written consents until after these events occur. The consent agreement is not a traditional “lock-up” agreement, as it does not create a legal obligation to consent to the merger until after the registration statement is declared effective and each BioSciences shareholder has received a copy of the information statement/prospectus.

Q:	WHY ISN’T THE CONSENT OF ALL BIOSCIENCES SHAREHOLDERS BEING SOLICITED?

Once the consenting shareholders have executed their consents, the merger will have been approved by 73.5% of the BioSciences shareholders. BioSciences already held one vote of its shareholders in September 2010 at which shareholders holding 14,293,368 shares voted in favor of the merger (representing 79.5% of the total outstanding BioSciences shares of common stock), no shares were voted against the proposed merger, and one shareholder holding 25,835 shares abstained. Even though the voting results of this meeting have been nullified by agreement of the parties in the amended merger agreement, Ampio and BioSciences believe there is no reason to seek consents of the remaining shareholders in light of the fact that no shareholder previously voted against the merger, and because the approval percentage by consent will only be 6% less than the percentage of BioSciences shareholders who previously voted in favor of the merger.

There is no requirement under Colorado law or applicable Federal law that requires BioSciences to seek approval of 100% of its stockholders prior to a business combination transaction. Ampio and BioSciences believe that doing so would result in a significant waste of corporate time, money and resources that would impair, rather than improve, shareholder value on completion of the merger, especially since (1) the BioSciences shareholders have previously had an opportunity to vote against the merger, and (2) the consenting shareholders represent 92.4% of the shareholders who previously voted in favor of the merger. Any BioSciences shareholder whose consent is not sought will have the right to exercise dissenters’ rights, as described below.

Q:	DO I HAVE DISSENTER’S RIGHTS OR APPRAISAL RIGHTS?

To the extent that a shareholder wishes to exercise dissenter’s rights, the shareholder must, among other things: (1) notify BioSciences of the shareholder’s intent to exercise dissenter’s rights and demand the fair value of the shareholder’s shares within 30 days after the date BioSciences mails this information statement/prospectus to such shareholder; and (2) not change the shareholder’s ownership of shares of BioSciences common stock through the time of the closing of the merger. BioSciences shareholders should carefully read the detailed discussion of dissenters’ rights of holders of shares of BioSciences common stock under “Dissenters’ Rights” beginning on page 75, as well as the full text of the requirements of Colorado law to exercise dissenters’ rights, which is attached as Annex D.

Even though BioSciences previously advised its shareholders of their dissenters’ rights, the parties have agreed that BioSciences will again offer its shareholders such rights, as provided in the amended merger agreement. No BioSciences shareholders exercised dissenters’ rights in connection with the September 2010 BioSciences shareholders’ meeting.

Q:	WILL BIOSCIENCES SHAREHOLDERS BE ABLE TO TRADE AMPIO COMMON STOCK THAT THEY RECEIVE PURSUANT TO THE MERGER?

Yes. The Ampio common stock issued pursuant to the merger will be registered under the Securities Act of 1933, as amended (the “Securities Act”), and will be quoted, as existing Ampio common stock is now quoted, on the OTC Bulletin Board under the symbol “AMPE.” All shares of Ampio common stock that you receive in the merger will be freely transferable, subject to the lockup agreement which is required to be executed by you before you receive your Ampio common stock certificates. The lockup agreement specifies that you agree not to sell or transfer your Ampio common stock received in the merger before December 31, 2011. The merger agreement requires each BioSciences shareholders to sign a lockup agreement before Ampio must deliver the certificates representing Ampio common stock to each shareholder. Executive and non-executive officers of BioSciences who receive Merger Stock, and executive and non-executive officers of Ampio at the time of the merger, are required by the merger agreement, as amended, to sign lock-up agreements covering the Merger Stock, and any other Ampio shares owned by such persons, for a period through February 28, 2012. For more information on BioSciences shareholders’ ability to trade Ampio common stock received in the merger see “The Merger—Lock-up Agreements” on page 53.

Q:	WHAT IF I PREVIOUSLY SENT MY STOCK CERTIFICATE TO BIOSCIENCES? SHOULD I SEND MY STOCK CERTIFICATE TO BIOSCIENCES NOW IF I DID NOT DO SO PREVIOUSLY?

If you have already sent your stock certificate to BioSciences, then BioSciences has held, and will continue to hold, your stock certificate pending the closing of the merger. If you have not previously sent your stock certificate to BioSciences, please do not do so at the present time. After the merger is completed, you will receive written instructions and a letter of transmittal for exchanging your BioSciences shares of common stock for shares of Ampio common stock. For more information see “The Merger Agreement—Conversion of Shares; Exchange Agent; Procedure for Exchange of Certificates; Fractional Shares” on page 64.

Q:	WHAT WILL HAPPEN TO MY BIOSCIENCES OPTIONS AND WARRANTS IN THE MERGER?

Holders of each vested and exercisable outstanding BioSciences stock option granted under BioSciences’ stock incentive plan and BioSciences warrants with an exercise price below $1.90 per share, the price of Ampio common stock on the last trading day immediately prior to the execution of the merger agreement, will be issued, from the Merger Stock, a number of shares of Merger Stock equal to the amount by which the option is “in-the-money.” That amount is by which the market price per share of the Merger Stock on the last trading day immediately prior to the execution of the Merger Agreement exceeds the exercise price per share under the option or warrant agreement. Accordingly, Ampio will issue 405,066 shares of Merger Stock to holders of all BioSciences “in-the-money” options and warrants that are currently exercisable. If an option is “out-of-the-money,” meaning its exercise price per share is higher than the market price per share of the Merger Stock as of the last trading day immediately prior to execution of the merger agreement, then Ampio will issue replacement Ampio stock option agreements with an exercise period identical to those in the BioSciences stock options, with the exercise price and number of underlying shares adjusted by the exchange ratio. There are 250,850 Biosciences options that are “out-of-the-money” which will be exchanged for 212,693 Ampio options pursuant to this provision of the amended merger agreement. Options formerly held by Bruce G. Miller, Dr. David Bar-Or, Raphael Bar-Or, Dr. James Winkler, and Wannell Crook will be canceled pursuant to the cancellation agreement and will therefore not participate in the Merger Stock issued for “in-the-money” options.

Q:	WHAT ARE THE UNITED STATES FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER?

The merger generally will not be a taxable transaction for U.S. federal income tax purposes to U.S. holders of BioSciences common stock. However, we have not sought a ruling from the Internal Revenue Service or a tax opinion as to the federal income tax consequences of the merger. You should consult your tax advisor for a full

understanding of the particular tax consequences of the merger. For a more detailed description of the tax consequences arising from the issuance of the Merger Stock to the BioSciences shareholders in the merger, see “Material United States Federal Income Tax Consequences” beginning on page .

Q:	WHEN DO YOU EXPECT THE MERGER TO BE COMPLETED?

Subject to the satisfaction of a number of conditions, we will complete the merger on the second business day following the date on which the last of the conditions to closing set forth in the amended merger agreement are fulfilled or waived. We currently anticipate the closing of the merger to occur in the first quarter of 2011.

Q:	WHERE CAN I FIND MORE INFORMATION ABOUT AMPIO AND BIOSCIENCES?

More information about Ampio is available from various sources described under “Where You Can Find More Information” on page of this information statement/prospectus. Additional information about Ampio may be obtained from its Internet website at www.ampiopharma.com. Information on the Ampio website is not part of this information statement/prospectus. Information about BioSciences can be obtained from Bruce G. Miller, President, who may be reached at (303) 418-1003.

We have included additional information about (1) Ampio’s business, including information concerning Ampio’s product candidates, business strategy, intellectual property, government regulation to which Ampio is subject, property, employees and related topics, (2) the executive officers and directors of Ampio both before and after the merger, (3) executive compensation and corporate governance information, (3) related party transactions between Ampio, on the one hand, and BioSciences, Ampio’s executive officers, directors, and 5% or more shareholders, on the other hand, and (4) Ampio’s principal shareholders, in Annex C to this information statement/prospectus. We encourage you to review in its entirety the information in Annex C for additional information on these subject matters as they relate to Ampio.

Q:	WHOM SHOULD I CONTACT IF I HAVE ADDITIONAL QUESTIONS?

A:	If you have additional questions, please contact Investor Relations at Ampio Pharmaceuticals, Inc., 5445 DTC Parkway, P4, Greenwood Village, Colorado 80111, telephone number (303) 418-1000.

Q:	ARE THERE RISKS ASSOCIATED WITH THE MERGER?

A:	Yes. You should read the section entitled “Risk Factors” beginning on page .

SUMMARY

The following summary highlights selected information from this information statement/prospectus and may not contain all of the information that is important to you. To better understand the merger, you should carefully read this entire document, including the Annexes to this information statement/prospectus, and the other documents to which this document refers you. See “Where You Can Find More Information” on page .

The Companies (See Page )

Ampio Pharmaceuticals, Inc.

5445 DTC Parkway, P4

Greenwood Village, Colorado 80111

Telephone: (303) 418-1000

Ampio, a Delaware corporation, is a development stage pharmaceutical company engaged in the discovery and development of innovative, proprietary pharmaceutical and diagnostic products to identify and treat inflammatory conditions, including metabolic disorders and diabetic complications. Ampio has a disciplined strategy and productive innovation platform that identifies and/or generates compounds and diagnostics with large potential value while minimizing development risk, cost, and time. The Ampio discovery process occurs in a true clinical environment that carries low overhead costs. Each drug candidate undergoes a sophisticated business filter to identify products that can be clinically and cost-effectively developed to generate substantial value and returns while minimizing risk. Ampio’s strategy focuses on generating human safety and efficacy data in order to position its product candidates for value-creating licensing agreements with strategic partners, and is not focused on conducting FDA-directed clinical trials.

Two of Ampio’s most advanced product candidates are repositioned drugs (Optina and Vasaloc) for which Ampio is seeking U.S. and international patent protection covering their unique composition or application. Strategically, repositioned drugs reduce the risk of product failure due to adverse toxicology, lead to more modest investments during development, and may achieve more rapid marketing approval. Ampio’s other product candidates include Ampion, a biologic being developed as a new molecular entity (NME) for inflammatory diseases, and an Oxidation Reduction Potential (ORP) diagnostic device which is now being prototyped for use in emergency rooms to assess stroke and chest pain stratification of patients.

Ampio also has several early stage product candidates, including nine compounds known as methylphenidates for anti-angiogenesis and anti-metastasis applications. These compounds are derivatives of Ritalin, but are considered NMEs. Ampio expects to seek a special protocol assessment from the FDA under which one or more of its methylphenidate compounds can be administered under a compassionate need exception to patients suffering from advanced liver, ovarian, brain or other cancers. Methylphenidates may also have applications for macular degeneration and to Alzheimer’s or other neurodegenerative disorders, as methylphenidates have strong anti-inflammatory properties. Ampio has conducted early research into how Copper chelating peptides, also considered an NME, may be used to treat Acute Coronary Syndrome and strokes. Because of the nature and extent of clinical trials needed to obtain regulatory approval for NMEs, Ampio plans to out-license these compounds to collaborators after it has obtained early clinical data, in the case of methylphenidates, and after toxicology studies are completed, in the case of copper chelating peptides. Ampio’s product candidate portfolio includes a number of additional compounds we are now studying, including compounds to treat gingivitis and periodontitis, to assist in the diagnosis and monitoring of skin disorders, and to use in testing for blood-borne infectious agents.

In the year ended December 31, 2009 and the nine months ended September 30, 2010, Ampio generated no revenues, and losses from operations and net losses of $1.51 million and $5.07 million, respectively.

Ampio Acquisition, Inc.

5445 DTC Parkway, P4

Greenwood Village, Colorado 80111

Telephone: (303) 418-1000

Merger Sub is a Delaware corporation and a direct wholly-owned subsidiary of Ampio. Merger Sub was organized on October 22, 2010, solely for the purpose of effecting the merger with BioSciences.

DMI BioSciences, Inc.

c/o Ampio Pharmaceuticals, Inc.

5445 DTC Parkway, P4

Greenwood Village, Colorado 80111

Telephone: (303) 418-1000

BioSciences, a privately-held Colorado corporation, is not currently engaged in active operations. BioSciences owns the rights to one product, Zertane, as to which BioSciences holds 32 issued patents and 31 pending patent applications. Zertane is a new use for tramadol hydrocloride, which was approved for marketing as a noncontrolled analgesic in 1995. Based on the results of two clinical trials BioSciences conducted, it believes it can be an effective oral medication to treat premature ejaculation, or PE, in men. Premature ejaculation is the most common form of male sexual dysfunction and has a major impact on the quality of life for many men and their partners. The market opportunity is large, with an estimated 30% of males suffering from premature ejaculation (four times the number with erectile dysfunction). According to Australia’s Keogh Institute of Medical Research, PE is the most common sexual complaint in males. At present no drug has been approved by the FDA for the treatment of premature ejaculation. Priligy, an orally-administered anti-depressant in the SSRI class, has been approved for the treatment of PE in two European countries, where it is marketed by Janssen-Cilag, a unit of Johnson & Johnson. National approvals and licenses in five other European countries are expected to shortly follow. Behavioral therapy is the current standard of care for treatment of PE.

BioSciences granted an option to license Zertane to a large pharmaceutical company in 2007, and the option was exercised in January 2009. The licensee was responsible for all costs of commercializing Zertane, including clinical trials, manufacturing, regulatory approvals, marketing and distribution, while BioSciences remained responsible for the cost of filing, maintaining and prosecuting patents, and of initial development of follow-on compounds. Between May 2007 and August 2009, BioSciences received $4.3 million in option and license fees related to Zertane, including a $1.5 million milestone payment related to the initiation of Phase III clinical trials. The BioSciences financial statements included in this information statement/prospectus reflect only approximately $3.6 million of the option and license fees attributable to Zertane because BioSciences has a September 30 fiscal year-end and approximately $.7 million in option and license fees were received by BioSciences in May and August 2007.

The licensee commenced two large Phase III clinical trials in Europe which were discontinued when the licensee terminated the license agreement in the second quarter of 2010, which BioSciences understands to have occurred due to a change in the licensee’s strategic direction at the time the licensee was acquired by a larger pharmaceutical company. At that time, BioSciences regained all rights to develop, license and seek regulatory approval to market Zertane worldwide. BioSciences is entitled to obtain the clinical trial data from the pharmaceutical company and its CRO, and expects to complete its preliminary review of this data in January 2011. BioSciences has applied for patent protection for a combination of Zertane and an erectile dysfunction, or ED, medicine to offer male patients a single oral medication that will treat both PE and ED. A combination drug would address the significant co-morbid ED and PE population. BioSciences intends to partner or seek licensing opportunities for this Zertane drug combination.

Corporate History of Ampio and BioSciences (See Page )

Life Sciences was formed in December 2008 and commenced operations in April 2009, when it acquired all of the assets of BioSciences except Zertane. In that acquisition, BioSciences received 3,500,000 shares of Ampio common stock in exchange for the transfer of the non-Zertane assets and assumption of certain liabilities. In March 2010, Life Sciences merged with a subsidiary of Chay Enterprises, Inc., a Colorado corporation that was publicly traded. Immediately after the merger, Chay Enterprises changed its name to Ampio Pharmaceuticals, Inc., and reincorporated in Delaware. For accounting and financial reporting purposes, Life Sciences was considered the acquirer and the merger was treated as a reverse acquisition. All financial information presented in this information statement/prospectus for periods prior to the Chay merger reflects only that of Life Sciences or the assets purchased from BioSciences, and does not reflect the pre-merger Chay assets, liabilities, or operating results. In addition, all share, per share and related Life Sciences information has been adjusted to take into account the Chay merger.

The Merger (See Page )

Subject to the terms and conditions of the amended merger agreement, at the effective time of the merger, Merger Sub will merge with and into BioSciences. BioSciences will survive the merger as a direct, wholly-owned subsidiary of Ampio.

The Amended Merger Agreement (See Page )

A copy of the amended merger agreement is attached to this information statement/prospectus as a portion of Annex A. We encourage you to read the merger agreement in its entirety.

Merger Consideration (See Page )

The aggregate consideration that will be paid by Ampio to BioSciences shareholders in the merger is 8,667,905 shares of Ampio common stock. This consideration includes the consideration payable to holders of in-the-money BioSciences stock options and warrants outstanding immediately prior to the effective time of the merger, and shares to be issued in extinguishment of two BioSciences promissory notes.

Ampio anticipates that it will deliver to holders of BioSciences in-the-money stock options and warrants, and holders of two promissory notes, an aggregate of 405,066 shares and 500,000 shares, respectively, out of the 8,667,905 shares of Merger Stock. The remaining 7,762,839 shares of Merger Stock will be issued to the holders of BioSciences common stock. At the date hereof, BioSciences had 17,975,587 shares of common stock outstanding, of which 9,171,282 shares are Class A common stock and 8,804,305 shares are Class B common stock. After the voluntary cancellation of the 8,804,305 shares of BioSciences Class B common stock by present and former executive officers and directors of BioSciences, the total number of BioSciences shares of common stock outstanding will be 9,171,282 shares at the effective time. Based on the closing price of Ampio common stock of $2.40 on December 31, 2010, the 7,762,839 shares of Merger Stock to be issued to the BioSciences shareholders represented approximately $2.03 in value for each share of the 9,171,282 BioSciences Class A shares of common stock outstanding that will be received by Ampio in the merger. Based on the closing price of Ampio common stock of $ per share on [—][—], 2011, the latest practicable date prior to the printing of this information statement/prospectus, and after deducting the 905,066 shares of Merger Stock to be issued to holders of in-the-money stock options and warrants and holders of two promissory notes, the Merger Stock represented approximately $ in value for each share of BioSciences common stock outstanding. The amount of merger consideration to be received by BioSciences shareholders may fluctuate between the date of this information statement/prospectus and the closing of the merger as a result of changes in the market price for Ampio common stock, the total number of shares of BioSciences common stock outstanding at closing, and the total number and exercise prices of BioSciences stock options and warrants outstanding at closing.

The Donation to Capital Agreement and the Cancellation Agreement

As described in the merger agreement, BioSciences and its affiliates, on the one hand, and Ampio, on the other hand, entered into the donation to capital agreement that takes effect immediately prior to the effective time. Under the donation to capital agreement, BioSciences agreed to donate to the capital of Ampio an aggregate of 3,500,000 shares of Ampio common stock currently owned by BioSciences, and the current and former officers and directors of BioSciences agreed to donate to the capital of BioSciences an aggregate of 8,804,305 shares of BioSciences Class B common stock owned by them. The effect of the donation to capital by the current and former officers and directors of BioSciences will be to retire all outstanding BioSciences Class B shares of common stock, with the result that the BioSciences Class A shareholders will own 100% of BioSciences at the effective time. Therefore, the current and former officers and directors of BioSciences will not receive Merger Stock as a result of their ownership of Class B common stock of BioSciences.

In addition, BioSciences and its current and former executive and non-executive officers have entered into the cancellation agreement, pursuant to which such persons have agreed to cancel, without payment, wages totaling $1.04 million that were accrued prior to September 2008. Ampio is a third party beneficiary of the cancellation agreement. The execution and delivery of the cancellation agreement and the donation to capital agreement were conditions precedent to the merger’s effectiveness, and will take effect immediately prior to the effective time.

BioSciences Options and Warrants (See Page )

Each vested and exercisable outstanding BioSciences stock option granted under BioSciences’ stock incentive plan or warrant with an exercise price below the effective price of Ampio common stock received by the BioSciences shareholders in the merger will be issued, from the Merger Stock, a number of shares of Merger Stock equal to the amount by which the option or warrant is “in-the-money.” The Merger Stock will be valued for the purposes of making this determination at $1.90 per share, the last reported sale price of the Ampio common stock on September 3, 2010, which was the last trading day immediately prior to the execution of the merger agreement. Based on this value, and as provided in the amended merger agreement, Ampio will issue an aggregate of 405,066 shares out of the Merger Stock to the BioSciences holders of “in-the-money” options and warrants. If an option is “out-of-the-money,” then Ampio will issue replacement Ampio stock option agreements with an exercise period identical to those in the BioSciences stock options, with the exercise price and number of underlying shares adjusted by the exchange ratio. At the date hereof, 250,850 Biosciences options that are “out-of-the-money” which will be exchanged for 212,693 Ampio options. The exercise periods of these options will expire at various dates through January 2014 and have a weighted average exercise price of $1.38. Options formerly held by Bruce G. Miller, Dr. David Bar-Or, Raphael Bar-Or, Dr. James Winkler, and Wannell Crook will be canceled pursuant to the cancellation agreement and will therefore not participate in the Merger Stock issued for “in-the-money” options.

BioSciences Promissory Notes and Related Agreements (See Page )

Pursuant to a conversion agreement between BioSciences and a current shareholder of BioSciences and the shareholder’s IRA, who collectively hold promissory notes from BioSciences with a principal balance of $430,000, Ampio will issue from the Merger Stock a total of 500,000 shares in cancellation of the indebtedness represented by such promissory notes. The note holders have agreed in the conversion agreement to waive all accrued and unpaid interest in connection with their receipt of the Merger Stock. The noteholders have been granted tag-along rights that allow the noteholders to include their shares in any sale by Messrs. Michael Macaluso, Donald B. Wingerter, Jr., David Bar-Or, and Bruce G. Miller of 30% or more of their shares of Ampio common stock in a private transaction, underwritten offering, or other sale transaction.

Beneficial Ownership of BioSciences Common Stock (See Page )

As of December 31, 2010, directors and executive officers of BioSciences beneficially owned and had the right to vote 6,004,583 shares of BioSciences common stock, totaling approximately 33.4% of the total number of outstanding BioSciences shares at that date. These shares will be voted in favor of the Merger pursuant to the BioSciences shareholder consent described in this information statement/prospectus. Any Class B shares of BioSciences common stock will be cancelled immediately after the vote is taken, and prior to the closing of the merger, in accordance with the cancellation agreement.

BioSciences Reasons for the Merger (See Page )

The BioSciences board of directors unanimously adopted and approved the merger agreement, with Mr. Miller abstaining as he was then an executive officer of Ampio. The BioSciences board of directors also unanimously determined, with Mr. Miller abstaining, that the merger agreement is advisable and in the best interests of BioSciences and its shareholders and unanimously recommended, with Mr. Miller abstaining, that BioSciences shareholders adopt the merger agreement and approve the merger and the other transactions contemplated thereby. In reaching its decision, the BioSciences board of directors considered a number of factors that are described in more detail in “The Merger—BioSciences Reasons for the Merger” beginning on page . Individual members of the BioSciences board of directors may have given different weight to different reasons for such approval.

Opinion of the Financial Advisor to BioSciences (See Page )

In connection with the merger, Bluestone Investment Banking Group, LLC (“Bluestone IBG”) delivered to the BioSciences board of directors its written opinion, dated September 7, 2010, to the effect that, as of that date and based on and subject to the various assumptions, matters considered and limitations described in the opinion, the merger consideration was fair, from a financial point of view, to the holders of BioSciences’ common stock. The full text of the written opinion of Bluestone IBG, which sets forth the assumptions made, matters considered and limits on the review undertaken by Bluestone IBG in rendering its opinion, is attached to this information statement/prospectus as Annex B. The opinion was addressed to, and for the benefit and use of, the BioSciences board of directors, was limited to the fairness, from a financial point of view, of the merger consideration, expressed no opinion as to the merits of the underlying decision by BioSciences to engage in the merger or the relative merits of the merger as compared to any alternative business strategies, and expressed no opinion or recommendation as to how any holder of BioSciences common stock should vote with respect to the merger or as to whether any holder of BioSciences common stock should deliver a consent with respect to the adoption of the merger agreement and the approval of the merger.

Consent Agreement (See Page )

As a condition to Ampio and Merger Sub entering into the merger agreement, the BioSciences Major Shareholders, which represent more than 67% of BioSciences outstanding common stock, entered into an agreement with Ampio pursuant to which such shareholders agreed, among other things, to execute and deliver a written consent adopting the merger agreement and approving the merger and the other transactions contemplated thereby once the registration statement with respect to the shares of Ampio common stock to be issued in the merger is declared effective by the SEC and such shareholders have received this information statement/prospectus.

Indemnification (See Page 65)

If BioSciences breaches any of the representations, warranties, covenants or agreements contained in the merger agreement or incurs any liability relating to certain specified items, the BioSciences shareholders (the “Indemnifying Shareholders”) will, for a period through December 31, 2011, be obligated to indemnify Ampio, its subsidiaries and its affiliates (except BioSciences) from, among other things, damages, penalties, fines, costs, amounts paid in settlement, liabilities, losses, expenses and fees caused by such breach or relating to such specified items (“Adverse Consequences”). Indemnification claims will be subject to a per-claim minimum threshold of $25,000 (aggregating all reasonably related claims). Any indemnification claims resulting from intentional misrepresentations or omissions of material fact in BioSciences representations and warranties are not subject to the $25,000 minimum. The Indemnifying Shareholders will not be obligated to indemnify Ampio from any incidental, consequential, special, punitive or other indirect damages. The indemnification obligations of the BioSciences shareholders are capped at the 250,000 Ampio shares held in the escrow fund which is described below, except for indemnification for intentional misrepresentations or omissions of material fact, which are subject to an additional indemnification by the BioSciences control shareholders.

Escrow Fund (See Page 66)

On the closing date, Ampio, James S. Kimmel, as the BioSciences shareholders’ representative (the “Shareholders’ Representative”), and Corporate Stock Transfer, Inc., as escrow agent, will enter into an escrow agreement pursuant to which Ampio will deposit into an escrow fund 250,000 shares of Ampio common stock issuable from the merger consideration payable to the BioSciences shareholders. The escrowed shares will be used to satisfy any indemnification obligations of the BioSciences shareholders arising under the merger agreement. On December 31, 2011, the escrow agent will release the escrowed shares to the BioSciences shareholders (less the value of any shares subject to pending indemnification claims). Shares to be released from the escrow fund may be applied on agreement of Ampio and the Shareholders’ Representative, to pay all the legal fees, if any, incurred or owed by him under the merger agreement and escrow agreement. The portion of the merger consideration deposited into the escrow fund will only reduce the merger consideration to be paid to the BioSciences shareholders at closing. Consequently, the merger consideration you will become entitled to receive at the effective time of the merger will be affected by the escrow of your proportionate interest in the 250,000 escrowed shares.

Interests of Certain Persons in the Merger (See Page 61)

Some of BioSciences directors and executive officers may have financial interests in the merger that are different from, or in addition to, the interests of BioSciences shareholders generally. BioSciences board of directors was aware of and considered these interests, among other matters, in evaluating and negotiating the merger agreement, and in recommending to the BioSciences shareholders that the merger agreement be approved and adopted.

These differing financial interests take a variety of forms. For example, at the effective time of the merger, BioSciences’ president and one of its directors, Bruce G. Miller, was serving as the chief financial officer of Ampio and is employed by a subsidiary of Ampio pursuant to the terms of an employment agreement. In addition, a number of the non-executive officers of BioSciences (who are also control shareholders of BioSciences) are employed in similar non-executive capacities with Ampio and are Ampio shareholders. While none of these persons is to receive severance or other benefits following a change in control of BioSciences, their affiliation with Ampio may have influenced their agreement to consent to the merger and to provide indemnification to Ampio for any intentional misrepresentations or omission of material fact by BioSciences.

For additional details about these financial interests, please see “The Merger—Interests of Certain Persons in the Merger” beginning on page 61.

Conditions to the Merger (See Page 72)

As more fully described in this document and in the merger agreement, the completion of the merger depends on a number of conditions being satisfied or, to the extent legally permissible, waived. These conditions include, among others, the effectiveness of the registration statement on which the shares issuable to BioSciences shareholders are registered, the correctness of all representations and warranties made by the parties in the merger agreement. as amended, and performance by the parties of their obligations under the merger agreement (subject in each case to certain materiality standards) and the cancellation agreement, the donation to capital agreement, and the conversion agreement.

Neither Ampio nor BioSciences can be certain when, or if, the conditions to the merger will be satisfied or waived. However, the amended merger agreement provides that if the registration statement covering the Merger Stock is not declared effective by June 15, 2011, then the parties have agreed to restructure the merger as an asset purchase transaction.

The completion of the merger is not conditioned on Ampio obtaining financing of any kind.

No Solicitation (See Page )

The merger agreement contains restrictions on the ability of BioSciences to solicit or engage in discussions or negotiations with a third party with respect to a proposal to acquire a significant interest in BioSciences equity or assets. Notwithstanding these restrictions, before the BioSciences Major Shareholders adopt the merger agreement and approve the merger by written consent, the merger agreement provides that, under specified circumstances, if BioSciences receives a proposal from a third party to acquire a significant interest in the company that the BioSciences board of directors determines in good faith may reasonably be expected to lead to a proposal that is superior to the merger, BioSciences may furnish nonpublic information to, and engage in negotiations regarding a transaction with, such third party (but may not terminate the Merger Agreement in order to enter into any such transaction).

Termination (See Page )

Ampio and BioSciences may mutually agree to terminate the merger agreement before the effective time of the merger. In addition, either Ampio or BioSciences may decide to terminate the merger agreement, even after the BioSciences shareholders’ approval, if:

•

the merger is not consummated by June 15, 2011, in which event the parties have agreed to restructure the merger as an asset purchase transaction (which may subject the BioSciences shareholders to tax consequences different from those that are expected to result from the merger);

•

there are final, non-appealable court or governmental entity rulings or orders preventing the merger; or

•

any law prohibiting the consummation of the merger is adopted or issued.

Ampio may also terminate the merger agreement if (i) the BioSciences board of directors makes a recommendation change adverse to Ampio or the merger, approves an acquisition agreement other than the merger agreement, or approves or recommends a competing transaction or (ii) BioSciences fails to mail this information statement/prospectus within four business days after the registration statement in which it is included is declared effective by the SEC.

Material United States Federal Income Tax Consequences (See Page )

The merger generally will be a non-taxable transaction for U.S. federal income tax purposes to U.S. holders of BioSciences common stock. For a more detailed description of the tax consequences of the exchange of BioSciences common stock in the merger, see “Material United States Federal Income Tax Consequences” beginning on page . However, we have not obtained a tax opinion from counsel or a ruling from the Internal Revenue Service concerning the federal income tax consequences of the merger.

Tax matters are very complicated. The tax consequences of the merger to you will depend on your own situation. We urge you to consult your own tax advisor for a full understanding of the U.S. federal, state, local and foreign tax consequences of the merger to you.

Comparison of Rights of Common Shareholders of Ampio and Common Shareholders of BioSciences (See Page )

After the merger, BioSciences shareholders will become Ampio shareholders and their rights as shareholders will be governed by the certificate of incorporation and by-laws of Ampio and the DGCL. There are a number of differences between the certificate of incorporation and by-laws of Ampio and the articles of incorporation and by-laws of BioSciences and the CBCA, and the rights of shareholders in a publicly-traded company rather than a smaller, privately-held company. These differences are summarized under the heading “Comparison of Rights of Shareholders of Ampio and Shareholders of BioSciences.”

Dissenters’ Rights (See Page 75)

Generally, a holder of shares of a Colorado corporation’s capital stock who does not vote for or consent to a merger and does not wish to accept the consideration provided for in the merger, is entitled under Colorado law to receive payment in cash of the “fair value” of those shares as determined Ampio, by negotiations of the parties, or ultimately by a Colorado court. However, the BioSciences Major Shareholders representing approximately 73.5% of its issued and outstanding common stock have agreed to consent to the merger and have effectively waived their dissenters’ rights.

Comparative Stock Prices and Dividends (See Page 12)

Shares of Ampio common stock are quoted on the OTC Bulletin Board under the symbol “AMPE.” On December 31, 2010, the next-to-last trading day prior to the filing of this information statement/prospectus, the last sale price of Ampio common stock on the OTC Bulletin Board was $2.40. On [—][—], 2011, the latest practicable date prior to the printing of this information statement/prospectus, the last sale price of Ampio common stock on the OTC Bulletin Board was $ . We urge you to obtain current quotations for Ampio common stock.

There is no established trading market for BioSciences’ common stock.

Regulatory Approvals Required for the Merger (See Page 61)

Consummation of the merger is not contingent upon the receipt of regulatory approvals. However, the merger will not be closed until following the delivery of this information statement/prospectus to the BioSciences shareholders.

Ampio intends to make all required filings under the Securities Act and the Securities Exchange Act of 1934, as amended (the “Exchange Act”), relating to the merger.

Accounting Treatment of the Merger (See Page 61)

The merger will be accounted for under the acquisition method in accordance with accounting principles generally accepted in the United States (“GAAP”).

Dividend Practices (See Page 12)

Neither Ampio nor BioSciences has ever paid a dividend on its common stock. Ampio has no plans or intent to pay dividends in the foreseeable future.

COMPARATIVE STOCK PRICES AND DIVIDENDS

There is no established public trading market for Ampio common stock. However, Ampio’s common stock is quoted on the Over-the-Counter Bulletin Board under the symbol “AMPE.” The following table sets forth the high and low last reported sale price information for Ampio common stock for the period from January 1, 2008 through December 31, 2010. The Over-the-Counter Bulletin Board quotations reflect inter-dealer prices, are without retail markup, markdowns or commissions, and may not represent actual transactions.


	Common Stock
	High		Low
First quarter 2008	$	—	$	—
Second quarter 2008	$	—	$	—
Third quarter 2008	$	1.75	$	1.50
Fourth quarter 2008	$	1.50	$	1.50
First quarter 2009	$	1.50	$	1.50
Second quarter 2009	$	1.50	$	1.50
Third quarter 2009	$	1.50	$	1.50
Fourth quarter 2009	$	1.50	$	1.50
First quarter 2010	$	1.50	$	1.50
Second quarter 2010	$	4.50	$	0.75
Third quarter 2010	$	3.50	$	1.00
Fourth quarter 2010	$	3.00	$	2.01

As of December 31, 2010, there were of record approximately 250 holders of Ampio common stock. This number is expected to increase on closing of the BioSciences acquisition by approximately 190 additional holders.

Ampio has never paid cash dividends and intend to employ all available funds in the development of its business. Ampio has no plans to pay cash dividends in the near future. If Ampio issues in the future any preferred stock or obtain financing from a bank, the terms of those financings may contain restrictions on Ampio’s ability to pay dividends for so long as the preferred stock or bank financing is outstanding.

There is no established public trading of, or a public market for, BioSciences’ common stock. BioSciences has never paid a dividend on its common stock.

On December 30, 2010, the last trading day prior to the execution of the amended merger agreement between the parties, the last reported sale price of Ampio common stock on the OTC Bulletin Board was $2.40. On [—][—], 2011, the most recent practicable date prior to the printing of this information statement/prospectus, the last reported sale price of Ampio common stock on the OTC Bulletin Board was $ . We urge you to obtain current stock price quotations for Ampio common stock from a newspaper, the Internet or your broker.

No assurance can be given as to the market price of Ampio common stock at the closing of the merger. Because the number of shares of Merger Stock will not be adjusted for changes in the market price of Ampio common stock, the market value of the shares of Ampio common stock that holders of BioSciences common stock will receive at the effective time of the merger may vary significantly from the market value of the shares of Ampio common stock that holders of BioSciences common stock would have received if the merger were consummated on the date of the amended merger agreement or on the date of this information statement/prospectus.

RISK FACTORS

As a result of the merger, BioSciences business will be subject to the following new or increased risks related to Ampio’s business and/or the merger. If any of the risks described below actually occur, the business, financial condition, results of operations or cash flows of the combined companies could be materially adversely affected. The risks below should be considered along with the other information included in this information statement/prospectus.

Risks Related to the Merger

The Merger Stock is fixed at 8,667,905 shares and will not be adjusted in the event that the price of Ampio common stock declines before the merger is completed. As a result, the value of the shares of Ampio common stock at the time BioSciences shareholders receive them could be less than the value of those shares today, or may be less at the time the Merger Stock lock-up expires.

In the merger, BioSciences shareholders will be entitled to receive for each share of BioSciences common stock owned by them shares of Ampio common stock, which we refer to as the Merger Stock. Ampio and BioSciences will not adjust the exchange ratio for the merger consideration which will be paid solely in Ampio common stock as a result of any change in the market price of Ampio common stock between the date of this information statement/prospectus and the date BioSciences shareholders receive shares of Ampio common stock in exchange for their shares of BioSciences common stock. The amended merger agreement also requires each BioSciences shareholder to execute a lock-up agreement prior to receiving his or her shares of Merger Stock. Under the lock-up agreement, the BioSciences shareholders are prohibited from selling or transferring the shares of Merger Stock received by them until December 31, 2010, except with respect to transfers made for estate planning purposes and other similar permitted purposes. Executive and non-executive officers of BioSciences who receive Merger Stock, and executive and non-executive officers and employees of Ampio at the time of the merger, are required by the merger agreement, as amended, to sign lock-up agreements covering the Merger Stock, and any other Ampio shares owned by such persons, for a period through February 28, 2012.

The market price of Ampio common stock will likely be different, and may be lower, on the date BioSciences shareholders are permitted to sell their shares of Merger Stock than the market price of Ampio common stock on the date of this information statement/prospectus. Differences in the market price of Ampio common stock may be the result of changes in the business, operations or prospects of Ampio, market reactions to the merger, regulatory considerations, general market and economic conditions or other factors.

The combined companies may not realize any benefits from the merger.

Ampio and BioSciences entered into the merger agreement with the expectation that the merger will result in benefits to the combined company, as described in “The Merger” beginning on page 51. The benefits from the merger that we anticipate achieving, including the alignment of shareholder interests of both companies and the elimination of conflicts of interest that currently exist as a result of the overlapping management and ownership of Ampio and BioSciences. While integrating Ampio and BioSciences is not expected to be difficult, Ampio management will be required to devote some time and resources to the final integration of the businesses. The time and resources devoted to final integration would otherwise be focused on ongoing operations and could negatively affect the combined companies’ ability to operate after the merger. If the combined operations of the post-merger company do not result in Ampio achieving any expected benefits, Ampio’s stock price and financial performance may be adversely impacted.

The market price of Ampio common stock may decline as a result of the merger and the sale of the Merger Stock by BioSciences shareholders.

The market price of Ampio common stock may decline after the merger when the lock-up agreement expires with the BioSciences shareholders. Ampio is unable to predict when the BioSciences shareholders may sell their shares or the number of shares that such shareholders may elect to sell. If sustained selling of our common stock occurs after expiration of the lock-up period, the price of our common stock may decline.

Ampio’s management may not be successful in licensing or otherwise realizing revenues from Zertane, which will adversely impact the financial performance of the combined companies and reduce the perceived benefits of the merger to Ampio.

Following the merger, Ampio management intends to opportunistically seek licensing or other revenue-generating arrangements for Zertane. Because Ampio has other product candidates in clinical trials or expected to soon enter clinical trials, Ampio management will not have the time or resources to implement a formal marketing plan or engage in extensive marketing activities which are limited to Zertane alone. The inability to realize license or other revenues from Zertane may adversely impact the operations and financial performance of the combined companies and may reduce the perceived benefit from the BioSciences acquisition.

BioSciences shareholders will have substantively different rights with respect to their stockholdings following the merger.

Upon consummation of the merger, the BioSciences shareholders, who presently hold stock in a private Colorado corporation, will become shareholders of Ampio, a public Delaware corporation. There are material differences between the rights of shareholders of private corporations and the rights of shareholders of public corporations, and between the rights of BioSciences shareholders under the BioSciences governing documents and the rights of Ampio shareholders under the Ampio governing documents. See “Comparison of Rights of Common Shareholders of Ampio and Common Shareholders of BioSciences” beginning on page 88.

The price of Ampio common stock and Ampio’s results of operations may be affected by factors different from those affecting BioSciences results of operations.

Holders of BioSciences common stock will be entitled to receive Ampio common stock in the merger and will thus become holders of Ampio common stock. Ampio’s business is different from that of BioSciences, as Ampio has a number of product candidates that it purchased from BioSciences in April 2009, and BioSciences has only one product candidate, Zertane. Ampio’s results of operations, as well as the price of Ampio common stock, may be affected by factors different from those factors affecting BioSciences results of operations. The price of Ampio common stock may fluctuate significantly following the merger, including as a result of factors over which Ampio has no control. For a discussion of Ampio’s business and certain factors to consider in connection with such businesses, see “Risk Factors—Risks Related to Ampio” below.

Risks Related to Ampio

Risks Related to Ampio’s Business

Ampio expects its net losses to continue for at least several years and are unable to predict the extent of future losses or when Ampio will become profitable, if ever.

Ampio has experienced significant net losses since inception. As of September 30, 2010, Ampio had an accumulated deficit of approximately $6.8 million and a stockholders’ deficit of approximately $1.5 million. Ampio expects its annual net losses to continue over the next several years as Ampio advances development programs and incurs significant clinical development costs.

Ampio has not received, and does not expect to receive for several years, any revenues from the commercialization of its product candidates. Ampio anticipates that licensing and collaboration arrangements, which may provide Ampio with potential milestone payments and royalties, will be its primary source of revenues for the next several years. Ampio cannot be certain that additional licensing or collaboration arrangements will be concluded, or that the terms of those arrangements will result in receiving material revenues. To obtain revenues from product candidates, Ampio must succeed, either alone or with others, in developing, obtaining regulatory approval for, and manufacturing and marketing drugs with significant market potential. Ampio may never succeed in these activities, and may never generate revenues that are significant enough to achieve profitability.

If Ampio does not secure collaborations with strategic partners to test, commercialize and manufacture product candidates, Ampio will not be able to successfully develop products and generate meaningful revenues.

A key aspect of Ampio’s strategy is to selectively enter into collaborations with third parties to conduct clinical testing, commercialize and manufacture product candidates. Ampio has no collaboration agreements currently in effect. Collaboration agreements typically call for milestone payments that depend on successful demonstration of

efficacy and safety, obtaining regulatory approvals, and clinical trial results. Collaboration revenues such as those generated by BioSciences are not guaranteed, even when efficacy and safety are demonstrated. The current economic environment may result in potential collaborators electing to reduce their external spending, which may prevent Ampio from developing our product candidates.

Even if Ampio succeeds in securing collaborators, the collaborators may fail to develop or effectively commercialize products using Ampio’s product candidates or technologies because they:

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do not have sufficient resources or decide not to devote the necessary resources due to internal constraints such as budget limitations, lack of human resources, or a change in strategic focus;

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believe our intellectual property or the product candidate may infringe on the intellectual property rights of others;

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dispute their responsibility to conduct development and commercialization activities pursuant to the applicable collaboration, including the payment of related costs or the division of any revenues;

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decide to pursue a competitive product developed outside of the collaboration;

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cannot obtain, or believe they cannot obtain, the necessary regulatory approvals;

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delay the development or commercialization of our product candidates in favor of developing or commercializing another party’s product candidate; or

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decide to terminate or not to renew the collaboration for these or other reasons.

For example, the collaborator that licensed Zertane conducted clinical trials which BioSciences believes demonstrated efficacy in treating PE, but the collaborator undertook a merger that BioSciences believe altered its strategic focus. The merger also created a potential conflict with a principal customer of the acquired company, which sells a product to treat PE in certain European markets.

As BioSciences experienced in this instance, collaboration agreements are generally terminable without cause on short notice. Once a collaboration agreement is signed, it may not lead to commercialization of a product candidate. Ampio also faces competition in seeking out new collaborators. If Ampio is unable to secure new collaborations that achieve the collaborator’s objectives and meet Ampio’s expectations, Ampio may be unable to advance its product candidates and may not generate meaningful revenues.

Optina, Vasaloc and Ampion will soon undergo clinical trials that are time-consuming and expensive, the outcomes of which are unpredictable , and for which there is a high risk of failure.

Preclinical testing and clinical trials are long, expensive and unpredictable processes that can be subject to delays. It may take several years to complete the preclinical testing and clinical development necessary to commercialize a drug, and delays or failure can occur at any stage. Interim results of clinical trials do not necessarily predict final results, and success in preclinical testing and early clinical trials does not ensure that later clinical trials will be successful. A number of companies in the pharmaceutical and biotechnology industries have suffered significant setbacks in advanced clinical trials even after promising results in earlier trials.

Ampio’s product development programs are at various stages of development. Ampio recently signed a contract with St. Michael’s Hospital, Toronto, Canada, under which St. Michael’s will conduct a Phase II trial for Ampio’s product candidate Optina for the treatment of diabetic macular edema, an early stage of diabetic retinopathy. Ampio intends also to commence a Phase II clinical trial for Vasaloc, its product candidate to treat diabetic nephropathy, by the first quarter of 2011. Ampio is currently preparing to seek approval for a Phase II double-blind, placebo-controlled clinical trial of the product candidate Ampion for the treatment of chronic inflammatory and autoimmune disease. An unfavorable outcome in one or more trials for Optina, Vasaloc, or Ampion would be a major set-back for the development programs for these product candidates and for the combined company. Due to our limited financial resources, an unfavorable outcome in one or more of these trials may require us to delay, reduce the scope of, or eliminate one of these product development programs, which could have a material adverse effect on the combined company and the value of our common stock. We anticipate that clinical trials of Optina and Vasaloc will take at least six to nine months to complete, and clinical trials of Ampion will take between 18 to 24 months to complete.

Ampio is currently in development and testing of various compounds for use in repurposed applications including various derivatives of Methylphenidates, a diketopiperazine, or DA-DKP, and several types of metal-binding compounds. Ampio also is now prototyping the ORP device to measure oxidation and antioxidation levels in the blood.

In connection with clinical testing and trials, Ampio faces risks that:

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a product candidate is ineffective, inferior to existing approved medicines, unacceptably toxic, or has unacceptable side effects;

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patients may die or suffer other adverse effects for reasons that may or may not be related to the product candidate being tested;

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the results may not confirm the positive results of earlier testing or trials; and

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the results may not meet the level of statistical significance required by the U.S. Food and Drug Administration, or FDA, or other regulatory agencies.

The results of preclinical studies do not necessarily predict clinical success, and larger and later-stage clinical studies may not produce the same results as earlier-stage clinical studies. Frequently, product candidates developed by pharmaceutical companies have shown promising results in early preclinical or clinical studies, but have subsequently suffered significant setbacks or failed in later clinical studies. In addition, clinical studies of potential products often reveal that it is not possible or practical to continue development efforts for these product candidates.

If Ampio does not successfully complete preclinical and clinical development, it will be unable to market and sell products derived from our product candidates and generate revenues. Even if Ampio does successfully complete clinical trials, those results are not necessarily predictive of results of additional trials that may be needed before a new drug application, or NDA, may be submitted to the FDA. Although there are a large number of drugs in development in the U.S. and other countries, only a small percentage result in the submission of an NDA to the FDA, even fewer are approved for commercialization, and only a small number achieve widespread physician and consumer acceptance following regulatory approval. If Ampio’s clinical studies are substantially delayed or fail to prove the safety and effectiveness of its product candidates in development, Ampio may not receive regulatory approval of any of these product candidates and the business and financial condition of the combined companies will be materially harmed.

Delays, suspensions and terminations in our clinical trials could result in increased costs to Ampio and delay its ability to generate revenues.

Human clinical trials are very expensive, time-consuming, and difficult to design, implement and complete. Ampio expects clinical trials of its product candidates will take from six to 24 months to complete, but the completion of trials for Ampio’s product candidates may be delayed for a variety of reasons, including delays in:

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demonstrating sufficient safety and efficacy to obtain regulatory approval to commence a clinical trial;

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reaching agreement on acceptable terms with prospective contract research organizations and clinical trial sites;

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manufacturing sufficient quantities of a product candidate;

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obtaining approval of an Investigational New Drug Application, or IND, from the FDA;

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obtaining institutional review board approval to conduct a clinical trial at a prospective clinical trial site;

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determining dosing and making related adjustments; and

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patient enrollment, which is a function of many factors, including the size of the patient population, the nature of the protocol, the proximity of patients to clinical trial sites, the availability of effective treatments for the relevant disease and the eligibility criteria for the clinical trial.

The commencement and completion of clinical studies for Ampio’s product candidates may be delayed, suspended or terminated due to a number of factors, including:

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lack of effectiveness of product candidates during clinical studies;

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adverse events, safety issues or side effects relating to the product candidates or their formulation;

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inability to raise additional capital in sufficient amounts to continue clinical trials or development programs, which are very expensive;

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the need to sequence clinical studies as opposed to conducting them concomitantly in order to conserve resources;

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Ampio’s inability to enter into collaborations relating to the development and commercialization of its product candidates;

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failure by Ampio or its collaborators to conduct clinical trials in accordance with regulatory requirements;

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Ampio’s inability or the inability of its collaborators to manufacture or obtain from third parties materials sufficient for use in preclinical and clinical studies;

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governmental or regulatory delays and changes in regulatory requirements, policy and guidelines, including mandated changes in the scope or design of clinical trials or requests for supplemental information with respect to clinical trial results;

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failure of Ampio’s collaborators to advance its product candidates through clinical development;

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delays in patient enrollment, variability in the number and types of patients available for clinical studies, and lower-than anticipated retention rates for patients in clinical trials;

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difficulty in patient monitoring and data collection due to failure of patients to maintain contact after treatment;

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a regional disturbance where we or our collaborative partners are enrolling patients in our clinical trials, such as a pandemic, terrorist activities or war, or a natural disaster; and

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varying interpretations of data by the FDA and similar foreign regulatory agencies.

Many of these factors may also ultimately lead to denial of regulatory approval of a current or potential product candidate. If Ampio experiences delays, suspensions or terminations in a clinical trial, the commercial prospects for the related product candidate will be harmed, and Ampio’s ability to generate product revenues will be delayed.

If Ampio’s product candidates are not approved by the FDA, Ampio will be unable to commercialize them in the United States.

The FDA must approve any new medicine before it can be marketed and sold in the United States. Ampio must provide the FDA with data from preclinical and clinical studies that demonstrate that its product candidates are safe and effective for a defined indication before they can be approved for commercial distribution. Ampio will not obtain this approval for a product candidate unless and until the FDA approves a NDA. The processes by which regulatory approvals are obtained from the FDA to market and sell a new or repositioned product are complex, require a number of years and involve the expenditure of substantial resources. Ampio cannot assure you that any of its product candidates will receive FDA approval in the future, and the time for receipt of any such approval is currently incapable of estimation.

Ampio intends to seek FDA approval for most of its product candidates using an expedited process established by the FDA, but Ampio may be asked to submit additional information to support a proposed change of a previously approved drug, which may substantially increase clinical trial costs, postpone any FDA product approvals, and delay Ampio’s receipt of any product revenues.

Assuming successful completion of clinical trials, Ampio expects to submit NDAs to the FDA for Optina, Vasaloc, and Zertane at various times in the future under §505(b)(2) of the Food, Drug and Cosmetic Act, as amended, or the FDCA. NDAs submitted under this section are eligible to receive FDA new drug approval by relying in part on the FDA’s findings for a previously approved drug. The FDA’s 1999 guidance on §505(b)(2) applications states that new indications for a previously approved drug, a new combination product, a modified active ingredient, or changes in dosage form, strength, formulation, and route of administration of a previously approved product are encompassed within the §505(b)(2) NDA process. Relying on §505(b)(2) is advantageous because this section of the FDCA does not require Ampio (i) to perform the full range of safety and efficacy trials that is otherwise required to secure approval of a new drug, and (ii) obtain a “right of reference” from the applicant that obtained approval of the previously approved drug. However, a §505(b)(2) application must support the proposed change of the previously approved drug by including necessary and adequate information, as determined by the FDA, and the FDA may still require Ampio to perform a full range of safety and efficacy trials.

If one of Ampio’s product candidates achieves clinical trial objectives, Ampio must prepare and submit to the FDA a comprehensive §505(b)(2) application. Review of the application may lead the FDA to request more information or require Ampio to perform additional clinical trials, thus adding to product development costs and delaying any marketing approval from the FDA. Ampio has no control over the FDA’s review time for any future NDA it submits, which may vary significantly based on the disease to be treated, availability of alternate treatments, severity of the disease, and the risk/benefit profile of the proposed product. Even if one of Ampio’s products receives FDA marketing approval, Ampio could be required to conduct post-marketing Phase IV studies and surveillance to monitor for adverse effects. If Ampio experiences delays in NDA application processing, requests for additional information or further clinical trials, or is required to conduct post-marketing studies or surveillance, Ampio’s product development costs could increase substantially, and its ability to generate revenues from a product candidate could be postponed, perhaps indefinitely. The resulting negative impact on Ampio’s operating results and financial condition may cause the value of Ampio common stock to decline, and you may lose all or a part of your investment.

The approval process outside the United States varies among countries and may limit Ampio’s ability to develop, manufacture and sell our products internationally.

Ampio may conduct clinical trials for, and seek regulatory approval to market, our product candidates in countries other than the United States. For example, the clinical trials for Optina will be conducted in Canada, the Zertane clinical trials were conducted in Europe, and Ampio plans to conduct the clinical trials of Ampion in Australia and India. Depending on the results of clinical trials and the process to obtain regulatory approvals in other countries, Ampio may decide to first seek regulatory approvals of a product candidate in countries other than the U.S., or Ampio may simultaneously seek regulatory approvals in the U.S. and other countries. If Ampio or any collaborators it secures seek marketing approvals for a product candidate outside the U.S., Ampio will be subject to the regulatory requirements of health authorities in each country in which Ampio seeks approvals. With respect to marketing authorizations in Europe, Ampio will be required to submit a European marketing authorization application, or MAA, to the European Medicines Agency, or EMEA, which conducts a validation and scientific approval process in evaluating a product for safety and efficacy. The approval procedure varies among regions and countries and can involve additional testing, and the time required to obtain approvals may differ from that required to obtain FDA approval. Obtaining regulatory approvals from health authorities in countries outside the U.S. is likely to subject Ampio to all of the risks associated with obtaining FDA approval described above. In addition, marketing approval by the FDA does not ensure approval by the health authorities of any other country, and approval by foreign health authorities does not ensure marketing approval by the FDA.

Even if one of Ampio’s product candidates receives regulatory approval, commercialization of the product may be adversely affected by regulatory actions and oversight.

Even if Ampio receives regulatory approval for a product candidate, this approval may carry conditions that limit the market for the product or put the product at a competitive disadvantage relative to alternative therapies. For instance, a regulatory approval may limit the indicated uses for which Ampio can market a product or the patient population that may utilize the product, or may be required to carry a warning on its packaging. Products with boxed warnings are subject to more restrictive advertising regulations than products without such warnings. These

restrictions could make it more difficult to market any product candidate effectively. Once a product candidate is approved, Ampio remains subject to continuing regulatory obligations, such as safety reporting requirements and additional post-marketing obligations, including regulatory oversight of promotion and marketing. In addition, the labeling, packaging, adverse event reporting, advertising, promotion and recordkeeping for an approved product remain subject to extensive and ongoing regulatory requirements. If Ampio becomes aware of previously unknown problems with an approved product in the U.S. or overseas or at any contract manufacturers’ facilities, a regulatory agency may impose restrictions on the product, any contract manufacturers or on Ampio, including requiring Ampio to reformulate the product, conduct additional clinical studies, change the labeling of the product, withdraw the product from the market or require a contract manufacturer to implement changes to its facilities. In addition, Ampio may experience a significant drop in the sales and royalties related to the product, its reputation in the marketplace may suffer, and Ampio could face lawsuits.

Ampio is also subject to regulation by regional, national, state and local agencies, including the Department of Justice, the Federal Trade Commission, the Office of Inspector General of the U.S. Department of Health and Human Services and other regulatory bodies, as well as governmental authorities in those other countries in which any of Ampio’s product candidates are approved for commercialization. The Federal Food, Drug, and Cosmetic Act, the Public Health Service Act and other federal and state statutes and regulations govern to varying degrees the research, development, manufacturing and commercial activities relating to prescription pharmaceutical products, including preclinical and clinical testing, approval, production, labeling, sale, distribution, import, export, post-market surveillance, advertising, dissemination of information, and promotion. If Ampio or any third parties that provide these services for Ampio are unable to comply, Ampio may be subject to regulatory or civil actions or penalties that could significantly and adversely affect the business of the combined companies. Any failure to maintain regulatory approval will limit Ampio’s ability to commercialize its product candidates, which would materially and adversely affect Ampio’s business and financial condition.

If Ampio does not achieve its projected development and commercialization goals in the timeframes Ampio announces and expects, the commercialization of its product candidates may be delayed and the business of the combined companies will be harmed and Ampio’s stock price may decline.

Ampio sometimes estimates for planning purposes the timing of the accomplishment of various scientific, clinical, regulatory and other product development objectives. These milestones may include Ampio’s expectations regarding the commencement or completion of scientific studies, clinical trials, the submission of regulatory filings, or commercialization objectives. From time to time, Ampio may publicly announce the expected timing of some of these milestones, such as the completion of an ongoing clinical trial, the initiation of other clinical programs, receipt of marketing approval, or a commercial launch of a product. The achievement of many of these milestones may be outside of Ampio’s control. All of these milestones are based on a variety of assumptions which may cause the timing of achievement of the milestones to vary considerably from our estimates, including:

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Ampio’s available capital resources or capital constraints Ampio experiences;

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the rate of progress, costs and results of Ampio’s clinical trials and research and development activities, including the extent of scheduling conflicts with participating clinicians and collaborators, and Ampio’s ability to identify and enroll patients who meet clinical trial eligibility criteria;

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Ampio’s receipt of approvals by the FDA and other regulatory agencies and the timing thereof;

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other actions, decisions or rules issued by regulators;

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Ampio’s ability to access sufficient, reliable and affordable supplies of compounds used in the manufacture of its product candidates;

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the efforts of Ampio’s collaborators with respect to the commercialization of its products; and

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the securing of, costs related to, and timing issues associated with, product manufacturing as well as sales and marketing activities.

If Ampio fails to achieve announced milestones in the timeframes Ampio announces and expects, Ampio’s business and results of operations may be harmed and the price of Ampio’s stock may decline.

Ampio’s success is dependent in large part upon the continued services of its Chief Scientific Officer.

Ampio’s success is dependent in large part upon the continued services of our Chief Scientific Officer, Dr. David Bar-Or. Ampio has an employment agreement with Dr. Bar-Or and a research agreement with Trauma Research, LLC, an entity owned by Dr. Bar-Or that conducts research and development activities on Ampio’s behalf. These agreements are terminable on short notice for cause by Ampio or Dr. Bar-Or and may also be terminated without cause under certain circumstances. Ampio does not maintain key-man life insurance on Dr. Bar-Or, although Ampio may elect to obtain such coverage in the future. If Ampio lost the services of Dr. Bar-Or for any reason, Ampio’s clinical testing and other product development activities may experience significant delays, and Ampio’s ability to develop and commercialize new product candidates may be diminished.

If Ampio does not obtain the capital necessary to fund its operations, Ampio will be unable to successfully develop, obtain regulatory approval of, and commercialize pharmaceutical products.

The development of pharmaceutical products is capital-intensive. At September 30, 2010, Ampio had cash of approximately $12,000, and BioSciences had cash of approximately $288,000. In order to continue funding Ampio’s operations, Ampio obtained bridge financing in November 2010 totaling approximately $1.39 million from 18 investors. The bridge financing converts automatically into Ampio common stock on March 31, 2011, or earlier upon completion of an offering of $10 million or more. Ampio anticipates it will require significant additional financing to continue to fund its operations. Ampio’s future capital requirements will depend on, and could increase significantly as a result of, many factors including:

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progress in, and the costs of, our preclinical studies and clinical trials and other research and development programs;

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the scope, prioritization and number of Ampio’s research and development programs;

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the achievement of milestones or occurrence of other developments that trigger payments under any collaboration agreements Ampio obtains;

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the extent to which Ampio is obligated to reimburse, or entitled to reimbursement of, clinical trial costs under future collaboration agreements, if any;

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the costs involved in filing, prosecuting, enforcing and defending patent claims and other intellectual property rights;

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the costs of securing manufacturing arrangements for commercial production; and

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the costs of establishing or contracting for sales and marketing capabilities if Ampio obtains regulatory clearances to market its product candidates.

Until Ampio can generate significant continuing revenues, Ampio expects to satisfy its future cash needs through collaboration arrangements, private or public sales of our securities, debt financings, or by licensing one or more of our product candidates. Dislocations in the financial markets have generally made equity and debt financing more difficult to obtain, and may have a material adverse effect on Ampio’s ability to meet its fundraising needs. Ampio cannot be certain that additional funding will be available to it on acceptable terms, if at all. If funds are not available, Ampio may be required to delay, reduce the scope of, or eliminate one or more of its research or development programs or its commercialization efforts. Additional funding, if obtained, may significantly dilute existing stockholders if that financing is obtained through issuing equity or instruments convertible into equity.

Ampio relies on third parties to conduct its clinical trials and perform data collection and analysis, which may result in costs and delays that prevent Ampio from successfully commercializing product candidates.

Although Ampio designs and manages its current preclinical studies, Ampio does not have the in-house capability to conduct clinical trials for its product candidates. Ampio relies, and will rely in the future, on medical institutions, clinical investigators, contract research organizations, contract laboratories, and collaborators to perform data collection and analysis and other aspects of Ampio’s clinical trials. For example, Ampio contracted with St. Michael’s Hospital, Toronto, Canada, to perform clinical trials for Optina, and the collaborator contracted by BioSciences performed clinical trials for Zertane. Ampio relies primarily on Trauma Research, LLC, a related party, to conduct preclinical studies and provide assessments of clinical observations.

Ampio’s preclinical activities or clinical trials conducted in reliance on third parties may be delayed, suspended, or terminated if:

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the third parties do not successfully carry out their contractual duties or fail to meet regulatory obligations or expected deadlines;

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Ampio replaces a third party; or

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the quality or accuracy of the data obtained by third parties is compromised due to their failure to adhere to clinical protocols, regulatory requirements, or for other reasons.

Third party performance failures may increase Ampio’s development costs, delay Ampio’s ability to obtain regulatory approval, and delay or prevent the commercialization of Ampio’s product candidates. While Ampio believes that there are numerous alternative sources to provide these services, in the event that Ampio seeks such alternative sources, Ampio may not be able to enter into replacement arrangements without incurring delays or additional costs.

Even if collaborators with which Ampio contracts in the future successfully complete clinical trials of Ampio’s product candidates, those candidates may not be commercialized successfully for other reasons.

Even if Ampio contracts with collaborators that successfully complete clinical trials for one or more of our product candidates, those candidates may not be commercialized for other reasons, including:

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failure to receive regulatory clearances required to market them as drugs;

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being subject to proprietary rights held by others;

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being difficult or expensive to manufacture on a commercial scale;

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having adverse side effects that make their use less desirable; or

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failing to compete effectively with products or treatments commercialized by competitors.

Relying on third-party manufacturers may result in delays in Ampio’s clinical trials and product introductions.

Ampio has no manufacturing facilities and has no experience in the manufacturing of drugs or in designing drug-manufacturing processes. If any of Ampio’s product candidates are approved by the FDA or other regulatory agencies for sale, Ampio will need to contract with a third party to manufacture it in commercial quantities. While Ampio believes there are a number of alternative sources available to manufacture its product candidates if and when regulatory approvals are received, Ampio may not be able to secure manufacturing arrangements on a timely basis when required, or at a reasonable cost. Ampio cannot estimate any delay in manufacturing or unanticipated manufacturing costs with certainty but, if either occurs, Ampio’s commercialization efforts may be impeded or its costs may increase.

Once regulatory approval is obtained, a marketed product and its manufacturer are subject to continual review. The discovery of previously unknown problems with a product or manufacturer may result in restrictions on the product, manufacturer or manufacturing facility, including withdrawal of the product from the market. Any manufacturers with which Ampio contracts are required to operate in accordance with FDA-mandated current good manufacturing practices, or cGMPs. A failure of any of Ampio’s contract manufacturers to establish and follow cGMPs and to document their adherence to such practices, may lead to significant delays in the launch of products based on Ampio’s product candidates into the market. Failure by Ampio’s third-party manufacturers to comply with applicable regulations could result in sanctions being imposed on Ampio, including fines, injunctions, civil penalties, revocation or suspension of marketing approval for any products granted pre-market approvals, seizures or recalls of products, operating restrictions, and criminal prosecutions.

Ampio intends to enter into agreements with third parties to sell and market any products Ampio develops and for which Ampio obtains regulatory approvals, which may affect the sales of Ampio’s products and its ability to generate revenues.

Ampio does not maintain an organization for the sale, marketing and distribution of pharmaceutical products and intends to contract with, or license, third parties to market any products Ampio develops that receive regulatory approvals. Outsourcing sales and marketing in this manner may subject the combined companies to a variety of risks, including:

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our inability to exercise control over sales and marketing activities and personnel;

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failure or inability of contracted sales personnel to obtain access to or persuade adequate numbers of physicians to prescribe our products;

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disputes with third parties concerning sales and marketing expenses, calculation of royalties, and sales and marketing strategies; and

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unforeseen costs and expenses associated with sales and marketing.

If Ampio is unable to partner with a third party that has adequate sales, marketing, and distribution capabilities, Ampio will have difficulty commercializing its product candidates, which would adversely affect the combined companies’ business, financial condition, and ability to generate product revenues.

Ampio faces substantial competition from companies with considerably more resources and experience than Ampio has, which may result in others discovering, developing, receiving approval for, or commercializing products before or more successfully than will the combined companies.

Ampio’s ability to succeed in the future depends on its ability to discover, develop and commercialize pharmaceutical products that offer superior efficacy, convenience, tolerability, and safety when compared to existing treatment methodologies. Ampio intends to do so by identifying product candidates that address new indications using previously approved drugs, use of new combinations of previously approved drugs, or which are based on a modified active ingredient which previously received regulatory approval. Because Ampio’s strategy is to develop new product candidates primarily for treatment of diseases that affect large patient populations, those candidates are likely to compete with a number of existing medicines or treatments, and a large number of product candidates that are being developed by others.

Many of Ampio’s potential competitors have substantially greater financial, technical, personnel and marketing resources than does Ampio. In addition, many of these competitors have significantly greater resources devoted to product development and preclinical research. Ampio’s ability to compete successfully will depend largely on its ability to:

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discover and develop product candidates that are superior to other products in the market;

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attract and retain qualified personnel;

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obtain patent and/or other proprietary protection for its product candidates;

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obtain required regulatory approvals; and

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obtain collaboration arrangements to commercialize Ampio’s product candidates.

Established pharmaceutical companies devote significant financial resources to discovering, developing or licensing novel compounds that could make Ampio’s product candidates obsolete. Accordingly, Ampio’s competitors may obtain patent protection, receive FDA approval, and commercialize medicines before Ampio does so. Other companies are engaged in the discovery of compounds that may compete with the product candidates Ampio is developing.

Any new product that competes with a currently-approved treatment or medicine must demonstrate compelling advantages in efficacy, convenience, tolerability and/or safety in order to address price competition and be commercially successful. If Ampio is not able to compete effectively against its current and future competitors, Ampio’s business will not grow and its financial condition and operations will suffer.

Product liability lawsuits could divert Ampio’s resources, result in substantial liabilities and reduce the commercial potential of Ampio’s medicines.

The risk that Ampio may be sued on product liability claims is inherent in the development and commercialization of pharmaceutical products. Side effects of, or manufacturing defects in, products that Ampio develops which are commercialized by any collaborators could result in the deterioration of a patient’s condition,

injury or even death. Once a product is approved for sale and commercialized, the likelihood of product liability lawsuits increases. Claims may be brought by individuals seeking relief for themselves or by individuals or groups seeking to represent a class. These lawsuits may divert Ampio’s management from pursuing its business strategy and may be costly to defend. In addition, if Ampio is held liable in any of these lawsuits, Ampio may incur substantial liabilities and may be forced to limit or forgo further commercialization of the affected products.

Although Ampio maintains general liability and product liability insurance, this insurance may not fully cover potential liabilities. In addition, inability to obtain or maintain sufficient insurance coverage at an acceptable cost or to otherwise protect against potential product liability claims could prevent or inhibit the commercial production and sale of any of Ampio’s product candidates that receive regulatory approval, which could adversely affect Ampio’s business. Product liability claims could also harm Ampio’s reputation, which may adversely affect Ampio’s collaborators’ ability to commercialize Ampio’s products successfully.

If any of Ampio’s product candidates are commercialized, this does not assure acceptance by physicians, patients, third party payors, or the medical community in general.

The commercial success of any of Ampio’s product candidates that secure regulatory approval will depend upon acceptance by physicians, patients, third party payors and the medical community in general. Ampio cannot be sure that any of our product candidates, if and when approved for marketing, will be accepted by these parties. Even if the medical community accepts a product as safe and efficacious for its indicated use, physicians may choose to restrict the use of the product if Ampio or any collaborator is unable to demonstrate that, based on experience, clinical data, side-effect profiles and other factors, Ampio’s product is preferable to any existing medicines or treatments. Ampio cannot predict the degree of market acceptance of any product candidate that receives marketing approval, which will depend on a number of factors, including, but not limited to:

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the demonstration of the clinical efficacy and safety of the product;

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the approved labeling for the product and any required warnings;

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the advantages and disadvantages of the product compared to alternative treatments;

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Ampio’s and any collaborator’s ability to educate the medical community about the safety and effectiveness of the product;

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the reimbursement policies of government and third party payors pertaining to the product; and

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the market price of Ampio’s product relative to competing treatments.

Government restrictions on pricing and reimbursement, as well as other healthcare payor cost-containment initiatives, may negatively impact Ampio’s ability to generate revenues if Ampio obtains regulatory approval to market a product.

The continuing efforts of the government, insurance companies, managed care organizations and other payors of health care costs to contain or reduce costs of health care may adversely affect one or more of the following:

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Ampio’s or our collaborators’ ability to set a price Ampio believes is fair for its products, if approved;

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Ampio’s ability to generate revenues and achieve profitability; and

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the availability of capital.

The 2010 enactments of the Patient Protection and Affordable Care Act, or PPACA, and the Health Care and Education Reconciliation Act are expected to significantly impact the provision of, and payment for, health care in the United States. Various provisions of these laws take effect over the next four years, and are designed to expand Medicaid eligibility, subsidize insurance premiums, provide incentives for businesses to provide health care benefits, prohibit denials of coverage due to pre-existing conditions, establish health insurance exchanges, and provide additional support for medical research. Additional legislative proposals to reform healthcare and

government insurance programs, along with the trend toward managed healthcare in the United States, could influence the purchase of medicines and reduce demand and prices for Ampio’s products, if approved. This could harm Ampio’s or our collaborators’ ability to market any products and generate revenues. Cost containment measures that health care payors and providers are instituting and the effect of further health care reform could significantly reduce potential revenues from the sale of any of Ampio’s product candidates approved in the future. In addition, in certain foreign markets, the pricing of prescription drugs is subject to government control and reimbursement may in some cases be unavailable. Ampio believes that pricing pressures at the federal and state level, as well as internationally, will continue and may increase, which may make it difficult for Ampio to sell its potential products that may be approved in the future at a price acceptable to Ampio or any of our future collaborators.

If Trauma Research uses hazardous and biological materials in a manner that causes injury or violates applicable law, Ampio may be liable for damages or fines.

The research and development activities conducted on Ampio’s behalf by Trauma Research, LLC, a related party controlled by Dr. Bar-Or, involve the controlled use of potentially hazardous substances, including chemical, biological and radioactive materials. In addition, Trauma Research’s operations produce hazardous waste products. Federal, state and local laws and regulations govern the use, manufacture, storage, handling and disposal of hazardous materials. If Trauma Research experiences a release of hazardous substances, it is possible that this release could cause personal injury or death, and require decontamination of facilities. Trauma Research has advised Ampio that it believes it is in compliance with laws applicable to the handling of hazardous substances, but such compliance does not assure that a release of hazardous substances will not occur, or assure that such compliance will be maintained in the future. In the event of an accident involving research being conducted on our behalf, Trauma Research could be held liable for damages or face substantial penalties for which Ampio could also be responsible. Ampio does not have any insurance for liabilities arising from the procurement, handling, or discharge of hazardous materials. Compliance with applicable environmental laws and regulations is expensive, and current or future environmental regulations may impair Ampio’s research, development and production efforts, which could harm its business.

Business interruptions could limit Ampio’s ability to operate its business.

Ampio’s operations are vulnerable to damage or interruption from computer viruses, human error, natural disasters, telecommunications failures, intentional acts of misappropriation, and similar events. Ampio has not established a formal disaster recovery plan, and its back-up operations and its business interruption insurance may not be adequate to compensate Ampio for losses that occur. A significant business interruption could result in losses or damages incurred by Ampio and require Ampio to curtail its operations.

Risks Related to Ampio’s Intellectual Property

Ampio’s ability to compete may decline if Ampio does not adequately protect its proprietary rights.

Ampio’s commercial success depends on obtaining and maintaining proprietary rights to Ampio’s product candidates and compounds and their uses, as well as successfully defending these rights against third-party challenges. Ampio will only be able to protect its product candidates, proprietary compounds, and their uses from unauthorized use by third parties to the extent that valid and enforceable patents, or effectively protected trade secrets, cover them. As of December 31, 2010, Ampio and BioSciences collectively owned or were the exclusive licensee under 10 issued United States patents, 24 U.S. pending patent applications, 46 issued international patents, and 108 pending international patent applications.

Ampio’s ability to obtain patent protection for the combined companies’ product candidates and compounds is uncertain due to a number of factors, including:

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Ampio may not have been the first to make the inventions covered by pending patent applications or issued patents;

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Ampio may not have been the first to file patent applications for its product candidates or the compounds Ampio developed or for their uses;

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others may independently develop identical, similar or alternative products or compounds;

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Ampio’s disclosures in patent applications may not be sufficient to meet the statutory requirements for patentability;

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any or all of Ampio’s pending patent applications may not result in issued patents;

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Ampio may not seek or obtain patent protection in countries that may eventually provide Ampio a significant business opportunity;

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any patents issued to Ampio may not provide a basis for commercially viable products, may not provide any competitive advantages, or may be successfully challenged by third parties;

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Ampio’s proprietary compounds may not be patentable;

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others may design around Ampio’s patent claims to produce competitive products which fall outside of the scope of Ampio’s patents; or

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others may identify prior art which could invalidate Ampio’s patents.

Even if Ampio has or obtains patents covering its product candidates or compounds, Ampio may still be barred from making, using and selling its product candidates or technologies because of the patent rights of others. Others have or may have filed, and in the future may file, patent applications covering compounds or products that are similar or identical to Ampio’s. There are many issued U.S. and foreign patents relating to chemical compounds and therapeutic products, and some of these relate to compounds Ampio intends to commercialize. Numerous U.S. and foreign issued patents and pending patent applications owned by others exist in the area of metabolic disorders, cancer, inflammatory responses, and the other fields in which Ampio is developing products. These could materially affect Ampio’s ability to develop its product candidates or sell its products if approved. Because patent applications can take many years to issue, there may be currently pending applications unknown to us that may later result in issued patents that our product candidates or compounds may infringe. These patent applications may have priority over patent applications filed by Ampio.

Ampio periodically conducts searches to identify patents or patent applications that may prevent Ampio from obtaining patent protection for its compounds or that could limit the rights Ampio has have claimed in its patents and patent applications. Disputes may arise regarding the source or ownership of Ampio’s inventions. It is difficult to determine if and how such disputes would be resolved. Others may challenge the validity of Ampio’s patents. If Ampio’s patents are found to be invalid, Ampio will lose the ability to exclude others from making, using or selling the compounds or products addressed in those patents. In addition, compounds or products Ampio may license may become important to some aspects of Ampio’s business. Ampio generally will not control the patent prosecution, maintenance or enforcement of licensed compounds or products.

Confidentiality agreements with employees and others may not adequately prevent disclosure of Ampio’s trade secrets and other proprietary information and may not adequately protect our intellectual property, which could limit Ampio’s ability to compete.

Because Ampio operates in the highly technical field of drug discovery and development of therapies that can address metabolic disorders, cancer, inflammation and other conditions, Ampio relies in part on trade secret protection in order to protect its proprietary technology and processes. However, trade secrets are difficult to protect. Ampio enters into confidentiality and intellectual property assignment agreements with its employees, consultants, outside scientific collaborators, sponsored researchers, and other advisors. These agreements generally require that the other party keep confidential and not disclose to third parties all confidential information developed by the party or made known to the party by Ampio during the course of the party’s relationship with Ampio. These agreements also generally provide that inventions conceived by the party in the course of rendering services to Ampio will be Ampio’s exclusive property. However, these agreements may not be honored and may not effectively assign intellectual property rights to Ampio. Enforcing a claim that a party illegally obtained and is using Ampio’s trade secrets is difficult, expensive and time consuming and the outcome is unpredictable. In addition, courts outside the United States may be less willing to protect trade secrets. The failure to obtain or maintain trade secret protection could adversely affect Ampio’s competitive position. Ampio has entered into non-compete agreements with certain of its employees, but the enforceability of those agreements is not assured.

A dispute concerning the infringement or misappropriation of Ampio’s proprietary rights or the proprietary rights of others could be time consuming and costly, and an unfavorable outcome could harm Ampio’s business.

There is significant litigation in Ampio’s industry regarding patent and other intellectual property rights. While Ampio is not currently subject to any pending intellectual property litigation, and is not aware of any such threatened litigation, Ampio may be exposed to future litigation by third parties based on claims that Ampio’s product candidates, technologies or activities infringe the intellectual property rights of others. In particular, there are many patents relating to repositioned drugs and chemical compounds used to treat metabolic disorders, cancer and inflammation. Some of these may encompass repositioned drugs or compounds that Ampio utilizes in its product candidates. If Ampio’s development activities are found to infringe any such patents, Ampio may have to pay significant damages or seek licenses to such patents. A patentee could prevent Ampio from using the patented repositioned drugs or compounds. Ampio may need to resort to litigation to enforce a patent issued to Ampio, to protect Ampio’s trade secrets, or to determine the scope and validity of third-party proprietary rights. From time to time, Ampio may hire scientific personnel or consultants formerly employed by other companies involved in one or more areas similar to the activities conducted by Ampio. Either Ampio or these individuals may be subject to allegations of trade secret misappropriation or other similar claims as a result of their prior affiliations. If Ampio becomes involved in litigation, it could consume a substantial portion of Ampio’s managerial and financial resources, regardless of whether Ampio wins or loses. Ampio may not be able to afford the costs of litigation. Any legal action against Ampio or its collaborators could lead to:

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payment of damages, potentially treble damages, if Ampio is found to have willfully infringed a party’s patent rights;

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injunctive or other equitable relief that may effectively block Ampio’s ability to further develop, commercialize, and sell products; or

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Ampio or its collaborators having to enter into license arrangements that may not be available on commercially acceptable terms, if at all.

As a result, Ampio could be prevented from commercializing current or future product candidates.

Pharmaceutical patents and patent applications involve highly complex legal and factual questions, which, if determined adversely to Ampio, could negatively impact Ampio’s patent position.

The patent positions of pharmaceutical companies can be highly uncertain and involve complex legal and factual questions. For example, some of Ampio’s patents and patent applications cover methods of use of repositioned drugs, while other patents and patent applications cover composition of a particular compound. The interpretation and breadth of claims allowed in some patents covering pharmaceutical compounds may be uncertain and difficult to determine, and are often affected materially by the facts and circumstances that pertain to the patented compound and the related patent claims. The standards of the United States Patent and Trademark Office, or USPTO, are sometimes uncertain and could change in the future. Consequently, the issuance and scope of patents cannot be predicted with certainty. Patents, if issued, may be challenged, invalidated or circumvented. U.S. patents and patent applications may also be subject to interference proceedings, and U.S. patents may be subject to reexamination proceedings in the USPTO. Foreign patents may be subject also to opposition or comparable proceedings in the corresponding foreign patent office, which could result in either loss of the patent or denial of the patent application or loss or reduction in the scope of one or more of the claims of the patent or patent application. In addition, such interference, reexamination and opposition proceedings may be costly. Accordingly, rights under any issued patents may not provide Ampio with sufficient protection against competitive products or processes.

In addition, changes in or different interpretations of patent laws in the United States and foreign countries may permit others to use Ampio’s discoveries or to develop and commercialize Ampio’s technology and products without providing any compensation to Ampio or may limit the number of patents or claims Ampio can obtain. The laws of some countries do not protect intellectual property rights to the same extent as U.S. laws and those countries may lack adequate rules and procedures for defending Ampio’s intellectual property rights. For example, some countries do not grant patent claims directed to methods of treating humans and, in these countries, patent protection may not be available at all to protect Ampio’s product candidates. In addition, U.S. patent laws may change, which could prevent or limit Ampio from filing patent applications or patent claims to protect its products and/or compounds.

If Ampio fails to obtain and maintain patent protection and trade secret protection of its product candidates, proprietary compounds and their uses, Ampio could lose its competitive advantage and competition Ampio faces would increase, reducing any potential revenues and adversely affecting Ampio’s ability to attain or maintain profitability.

General Risks Related to Ampio

The price of Ampio stock has been extremely volatile and may continue to be so, and investors in Ampio stock could incur substantial losses.

The price of Ampio’s common stock has been extremely volatile and may continue to be so. The stock market in general and the market for pharmaceutical companies in particular have experienced extreme volatility that has often been unrelated to the operating performance of particular companies, to a greater extent during the last few years. The following factors, in addition to the other risk factors described in this section, may also have a significant impact on the market price of Ampio’s common stock:

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any actual or perceived adverse developments in clinical trials for Optina, Vasaloc or Ampion;

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any actual or perceived adverse developments with respect to the effort to re-license Zertane, or a licensee’s termination of a license, such as BioSciences experienced with Zertane earlier in 2010;

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any actual or perceived difficulties or delays in obtaining regulatory approval of any of Ampio’s product candidates in the United States or other countries once clinical trials are completed;

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any finding that Ampio’s product candidates are not safe or effective, or any inability to demonstrate clinical effectiveness in Ampio’s product candidates when compared to existing treatments;

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any actual or perceived adverse developments in repurposed drug technologies, including any change in FDA policy or guidance on approval of repurposed drug technologies for new indications;

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any announcements of developments with, or comments by, the FDA, the EMEA, or other regulatory authorities with respect to product candidates Ampio has under development;

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any announcements concerning Ampio’s retention or loss of key employees, especially Dr. Bar-Or;

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Ampio’s success or inability to obtain collaborators to conduct clinical trials, commercialize a product candidate for which regulatory approval is obtained, or market and sell an approved product candidate;

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any actual or perceived adverse developments with respect to Ampio’s relationship with TRLLC;

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announcements of patent issuances or denials, product innovations, or new commercial products by Ampio’s competitors that will compete with any of Ampio’s product candidates;

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publicity regarding actual or potential study results or the outcome of regulatory reviews relating to products under development by Ampio, Ampio’s collaborators, or Ampio’s competitors;

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economic and other external factors beyond Ampio’s control; and

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sales of stock by Ampio or by Ampio’s shareholders.

There is, at present, only a limited market for Ampio’s common stock, and there is no assurance that an active trading market for Ampio’s common stock will develop.

Even though Ampio’s securities are currently quoted on the OTC Bulletin Board, Ampio’s common stock has been thinly traded. To the extent that is true, an investor may not be able to liquidate his or her investment without a significant decrease in price, or at all.

Unless our common stock is listed on a national securities exchange, the application of the “penny stock” rules to transactions in Ampio’s common stock could limit the trading and liquidity of Ampio’s common stock, adversely affect the market price of Ampio’s common stock, and impose additional costs on transactions involving Ampio’s common stock.

Trades of our common stock are currently subject to Rule 15g-9 promulgated by the SEC under the Securities and Exchange Act of 1934, as amended, or the Exchange Act, which imposes certain requirements on broker-dealers

who sell securities subject to the rule to persons other than established customers and accredited investors. For transactions covered by the rule, broker-dealers must make a special suitability determination for purchasers of the securities and receive the purchaser’s written agreement to the transaction prior to sale. The SEC also has other rules that regulate broker-dealer practices in connection with transactions in “penny stocks.” Penny stocks generally are equity securities with a price of less than $5.00 (other than securities listed on a national securities exchange, provided that current price and volume information with respect to transactions in those securities are provided by the exchange or system). The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the penny stock rules, to deliver a standardized risk disclosure document prepared by the SEC that provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction, and monthly account statements showing the market value of each penny stock held in the customer’s account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer’s confirmation. These disclosure requirements have the effect of reducing the level of trading activity for Ampio’s securities. As a result of the foregoing, investors may find it difficult to sell their Ampio common stock.

Concentration of Ampio’s ownership will limit your ability to influence corporate matters.

As of December 31, 2010, Ampio’s directors, executive officers and their affiliates beneficially owned approximately 40.6% of our outstanding common stock, after giving effect to the merger and the issuance of 8,667,905 shares of our common stock to the BioSciences shareholders and the donation to Ampio’s capital of 3,500,000 shares of Ampio common stock by BioSciences. These stockholders may control effectively the outcome of actions taken by Ampio that require stockholder approval.

Anti-takeover provisions in Ampio’s charter and bylaws and in Delaware law could prevent or delay a change in control of Ampio.

Provisions of Ampio’s certificate of incorporation and bylaws may discourage, delay or prevent a merger or acquisition that stockholders may consider favorable, including transactions in which you might otherwise receive a premium for your shares. These provisions include:

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requiring supermajority stockholder voting to effect certain amendments to Ampio’s certificate of incorporation and bylaws;

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restricting the ability of stockholders to call special meetings of stockholders;

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prohibiting stockholder action by written consent except in certain circumstances; and

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establishing advance notice requirements for nominations for election to the board of directors or for proposing matters that can be acted on by stockholders at stockholder meetings.

Increased costs associated with corporate governance compliance may significantly impact Ampio’s results of operations.

Changing laws, regulations and standards relating to corporate governance, public disclosure and compliance practices, including the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, the Sarbanes-Oxley Act of 2002, and new SEC regulations, are creating uncertainty for companies such as Ampio in understanding and complying with these laws and regulations. As a result of this uncertainty and other factors, devoting the necessary resources to comply with evolving corporate governance and public disclosure standards has resulted in and may in the future result in increased general and administrative expenses and a diversion of management time and attention to compliance activities. Ampio also expects these developments to increase its legal compliance and financial reporting costs. In addition, these developments may make it more difficult and more expensive for Ampio to obtain director and officer liability insurance, and Ampio may be required to accept reduced coverage or incur substantially higher costs to obtain coverage. Moreover, Ampio may be unable to comply with these new laws and regulations on a timely basis.

These developments could make it more difficult for Ampio to retain qualified members of our board of directors, or qualified executive officers. Ampio is presently evaluating and monitoring regulatory developments and cannot estimate the timing or magnitude of additional costs Ampio may incur as a result. To the extent these costs are significant, Ampio’s general and administrative expenses are likely to increase.

If Ampio sells shares of its common stock or securities convertible into its common stock in future financings, the ownership interest of existing shareholders will be diluted and, as a result, Ampio’s stock price may go down.

Ampio may from time to time issue additional shares of common stock at a discount from the current trading price of its common stock. As a result, Ampio’s existing shareholders will experience immediate dilution upon the purchase of any shares of Ampio’s common stock sold at a discount. For example, in November 2010, 18 investors purchased convertible debentures in the amount of $1.39 million from Ampio. In addition, as other capital raising opportunities present themselves, Ampio may enter into financing or similar arrangements in the future, including the issuance of additional debt securities, preferred stock or common stock. If Ampio issues common stock or securities convertible into common stock, Ampio shareholders will experience dilution and this dilution will be greater if Ampio finds it necessary to sell securities at a discount to prevailing market prices.

If Ampio fails to maintain proper and effective internal controls, Ampio’s ability to produce accurate and timely financial statements could be impaired and investors’ views of Ampio could be harmed.

The Sarbanes-Oxley Act requires, among other things, that Ampio maintain effective internal control over financial reporting and disclosure controls and procedures. In particular, Ampio must perform system and process evaluation and testing of its internal control over financial reporting to allow management to assess the effectiveness of Ampio’s internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act. Even though our independent auditor is exempted by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 from having to currently opine on the effectiveness of Ampio’s internal controls, Ampio’s management team is still required to conduct an annual assessment of the effectiveness of Ampio’s internal controls. If Ampio is unable to comply with the requirements of Section 404 in a timely manner, or if Ampio identifies material weaknesses in its internal control over financial reporting, the market price of Ampio common stock could decline and Ampio could be subject to sanctions or investigations by the SEC or other regulatory authorities, which would require Ampio to expend additional financial and management resources.

If securities analysts do not publish research or reports about Ampio’s business or if they downgrade Ampio’s stock after instituting coverage, the price of Ampio’s common stock could decline.

The research and reports that industry or financial analysts publish about Ampio or its business may vary widely and may not predict accurate results, but will likely have an effect on the trading price of Ampio’s common stock. If an industry analyst decides not to cover Ampio, or if an industry analyst institutes coverage and later decides to cease covering Ampio, Ampio could lose visibility in the market, which in turn could cause Ampio’s stock price to decline. If an industry analyst who covers Ampio’s stock decides to downgrade that stock, Ampio’s stock price would likely decline rapidly in response.

Ampio has no plans to pay dividends on its common stock, so you will not receive funds without selling your common stock.

Ampio has no plans to pay dividends on its common stock. Ampio generally intends to invest future earnings, if any, to fund Ampio’s growth. Any payment of future dividends will be at the discretion of Ampio’s Board of Directors and will depend on, among other things, Ampio’s earnings, financial condition, capital requirements, level of indebtedness, statutory and contractual restrictions applying to the payment of dividends and other considerations that Ampio’s Board of Directors deems relevant. Any future credit facilities or preferred stock financing Ampio obtains may further limit Ampio’s ability to pay dividends on its common stock. Accordingly, you may have to sell some or all of your common stock in order to generate cash from the Ampio common stock you receive in the merger. You may not receive a gain on your investment when you sell your common stock and whatever cash you realize may be worth less than the purchase price of the BioSciences stock you owned.

A large number of shares may be sold in the market following the merger, which may depress the market price of Ampio’s common stock.

A large number of shares may be sold in the market following the merger, which may depress the market price of Ampio’s common stock. Sales of a substantial number of shares of Ampio common stock in the public market

following the merger could cause the market price of Ampio’s common stock to decline. If there are more shares of common stock offered for sale than buyers willing to purchase, then the market price of Ampio’s common stock may decline to a market price at which buyers are willing to purchase the offered shares.

Upon closing of the merger, Ampio will have 22,274,941 shares of common stock outstanding. Of these shares, 356,587 shares are free-trading. The 8,667,905 shares of common stock issuable in the merger to the BioSciences shareholders will be free-trading, subject to the provisions of the lock-up agreements under which such shareholders are prohibited from selling, pledging or hypothecating the Ampio common stock to be received by them until December 31, 2011. Ampio will condition the distribution of certificates representing free-trading shares of Ampio common stock to the BioSciences shareholders on receipt of signed lock-up agreements from all of such persons. Executive and non-executive officers of BioSciences who receive Merger Stock, and executive and non-executive officers and employees of Ampio at the time of the merger, are required by the merger agreement, as amended, to sign lock-up agreements covering the Merger Stock, and any other Ampio shares owned by such persons, for a period through February 28, 2012.

The remaining 13,250,449 shares are “restricted securities” as defined under Rule 144 under the Securities Act. Ampio cannot predict the likelihood or timing of any future sales of Ampio common stock issued to Ampio shareholders prior to this offering. Any sales by Ampio shareholders could depress the market price of Ampio common stock.

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

This information statement/prospectus contains or incorporates by reference forward-looking statements within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Generally, the use of terms such as “will,” “may,” “should,” “continue,” “believes,” “expects,” “intends,” “anticipates,” “estimates” and similar expressions identify forward-looking statements; and any statements regarding the benefits of the merger, or Ampio’s or BioSciences expected financial condition, results of operations and business are also forward-looking statements. Without limiting the generality of the preceding sentence, the statements contained in the sections “Questions and Answers about the Merger,” “Risk Factors,” “The Merger—Background of the Merger,” “The Merger—Ampio’s Reasons for the Merger,” “The Merger—BioSciences’ Reasons for the Merger” and “The Merger—Opinion of Financial Advisor to BioSciences” including, without limitation, any statements as to the expected impact of the merger on Ampio’s financial condition, any description of expected synergies, and other statements contained herein regarding matters that are not historical facts constitute forward-looking statements.

These forward-looking statements involve known and unknown risks and uncertainties that are difficult to predict. Factors that could cause actual results to differ materially from those contemplated by the forward-looking statements include, among others, the following factors:

•

Ampio’s and BioSciences ability to complete the merger;

•

Ampio’s ability to realize synergies from the merger;

•

the results and timing of Ampio’s clinical trials, particularly the Optina, Vasaloc and Ampion trials;

•

the regulatory review process and any regulatory approvals that are issued or denied by the FDA, the EMEA, or other regulatory agencies;

•

our need to secure collaborators to license, manufacture, market and sell any products for which we receive regulatory approval in the future;

•

the results of our internal research and development efforts;

•

the commercial success and market acceptance of any of our product candidates that are approved for marketing in the United States or other countries;

•

the safety and efficacy of medicines or treatments introduced by competitors that are targeted to indications which our product candidates have been developed to treat;

•

acceptance and approval of regulatory filings;

•

our need for, and ability to raise, additional capital;

•

our collaborators’ compliance or non-compliance with their obligations under our agreements with them, or decisions by our collaborators to discontinue clinical trials and return product candidates to us; and

•

our plans to develop other product candidates.

You should not place undue reliance on our forward-looking statements in this information statement/prospectus because the matters they describe are subject to known and unknown risks, uncertainties and other unpredictable factors, many of which are beyond our control. Our forward-looking statements are based on the information currently available to us and speak only as of the date of this information statement/prospectus. New risks and uncertainties arise from time to time, and it is impossible for us to predict these matters or their effect on us. Over time, our actual results, performance or achievements will likely differ from the anticipated results, performance or achievements that are expressed or implied by our forward-looking statements, and such differences might be significant and materially adverse to our investors. We have no duty to, and do not intend to, update or revise the forward-looking statements in this information statement/prospectus after the date of this information statement/prospectus except to the extent required by the federal securities laws. You should consider all risks and uncertainties disclosed in our filings with the SEC described below under the heading “Where You Can Find More Information,” all of which are accessible on the SEC’s website at www.sec.gov.

SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF AMPIO

The selected financial data below presents historical consolidated financial data for Ampio and its subsidiaries, for Ampio’s predecessor Life Sciences and, prior to the formation of Life Sciences, the selected historical financial data for the BioSciences assets purchased by Life Sciences from BioSciences in April 2009. This data should be read in conjunction with (i) the consolidated balance sheets of Life Sciences and its subsidiaries as of December 31, 2009 and the related consolidated statements of operations, stockholders’ equity (deficit), and cash flows for each of the years in the two-year period ended December 31, 2009, (ii) consolidated balance sheets of DMI BioSciences Assets Sold as of April 15, 2009 and September 15, 2008, and the related consolidated statements of operations, contributions from parent, and cash flows for the period from September 30, 2008 through April 15, 2009, and the year ended September 30, 2008, and (iii) the unaudited consolidated balance sheet of Ampio at September 30, 2010, and the related unaudited consolidated statements of operations, stockholders’ equity (deficit), and cash flows for the nine months ended September 30, 2010 and 2009. These financial statements are attached as Annex E to this information statement/prospectus. The selected financial data at and for the years ended December 31, 2009 and 2008 for Ampio represent its financial position and results of operations prior to the merger, and do not include adjustments associated with the merger.

Ampio’s interim financial information as of September 30, 2010 and 2009 includes all adjustments, consisting of normal recurring adjustments, that management of Ampio considers necessary for fair presentation of the financial position and results of operations for such periods in accordance with GAAP.


	Ampio Pharmaceuticals, Inc.
	Nine Months Ended September 30,						Year Ended December 31,
	2010			2009			2009			2008
	(unaudited)			(unaudited)

Statement of Operations Data Data:
Expenses
Research and development	$	1,416,278		$	606,642		$	1,070,370		$	—
General and administrative		3,639,134			316,266			441,135			1,080

Total expenses		5,055,412			922,908			1,511,505			1,080

Loss from operations		(5,055,412	)		(922,908	)		(1,511,505	)		(1,080	)

Other income (expense), net		(16,103	)		1,027			(323	)		—

Net loss	$	(5,071,515	)	$	(921,881	)	$	(1,511,828	)	$	(1,080	)


Basic and diluted net loss per common share	$	(0.32	)	$	(0.08	)	$	(0.17	)	$	(0.00	)


Weighted average number of common shares outstanding		16,012,613			11,737,546			8,787,650			1,080,000


	Ampio Pharmaceuticals, Inc.
	As of September 30, 2010			As of December 31,
	As of September 30, 2010			2009			2008
	(unaudited)

Balance sheet data:
Cash, cash equivalents and investments	$	11,836		$	71,983		$	—
Working capital (deficit)		(1,541,190	)		(267,970	)		—
Total assets		85,080			86,280			—
Total stockholders’ deficit		(1,539,305	)		(267,970	)		(1,080	)


	DMI BioSciences Assets Sold
	Period from September 30, 2008 through April 15, 2009			Year ended September 30, 2008

Statement of Operations Data
Revenue		53,750			50,000
Expenses
Research and development		499,246			879,844
General and administrative		9,451			123,838

Total expenses		508,697			1,003,682

Loss from operations		(454,947	)		(953,682	)

Other income (expense), net		(3,740	)		(534	)

Net income (loss)	$	(458,687	)	$	(954,216	)


	DMI BioSciences Assets Sold
	April 15, 2009			September 30, 2008

Balance sheet data:
Working capital (deficit)		(252,255	)		(75,534	)
Total assets		—			19,296
Total contribution from parent		(252,255	)		(56,238	)

SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF BIOSCIENCES

The selected historical consolidated financial data of BioSciences is derived from the audited consolidated financial statements and related notes for each of the years indicated below. You should read the selected financial data presented below together with BioSciences’ consolidated financial statements, and the notes to those consolidated financial statements, appearing elsewhere in this document. The BioSciences selected consolidated financial data at and for the year ended September 30, 2010, 2009 and 2008 represent its consolidated financial position and results of operations prior to the merger, include appropriate adjustments reflecting the sale of the assets to Life Sciences in April 2009, but do not include adjustments associated with the merger.

Pursuant to SEC rules, Ampio’s acquisition of BioSciences requires Ampio to file financial information with the SEC on BioSciences as a significant subsidiary that exceeds 50% significance to Ampio using the revenue test. Accordingly, the consolidated balance sheets of BioSciences and its subsidiaries as of September 30, 2010 and 2009 and the related consolidated statements of operations, changes in shareholders’ equity, and cash flows for each of the years in the three-year period ended September 30, 2010 are attached as Annex F to this information statement/prospectus.


	DMI BioSciences, Inc.
	Year Ended September 30,
	2010			2009			2008

Statement of Operations Data
Revenues
License fees	$	625,000		$	875,000		$	500,000
Royalty fees		—			58,750			75,000
Milestone payments		—			1,500,475			—
Other revenue		—			111,943			36,865

Total revenue		625,000			2,546,168			611,865

Expenses
Research and development		152,202			866,113			153,397
General and administrative		280,493			7,242,975			1,041,569

Total expenses		432,695			8,109,088			1,194,966

Income (loss) from operations		192,305			(5,562,920	)		(583,101	)
Other income (expenses)
Interest income		11,644			1,568			1,566
Loss on disposal		—			—			(513,000	)
Interest expense		(49,387	)		(57,520	)		(60,650	)

Other income (expense), net		(37,743	)		(55,952	)		(572,084	)

Net income (loss)	$	154,562		$	(5,618,872	)	$	(1,155,185	)


	DMI BioSciences, Inc.
	As of September 30,
	2010			2009

Balance sheet data:
Cash, cash equivalents and investments	$	288,196		$	1,702,204
Working capital (deficit)		(1,457,724	)		(1,086,973	)
Total assets		630,730			1,702,204
Total stockholders’ deficit		(1,457,724	)		(1,633,136	)

SUMMARY SELECTED UNAUDITED PRO FORMA CONSOLIDATED COMBINED FINANCIAL DATA

The following tables set forth selected unaudited pro forma consolidated combined financial data for Ampio and BioSciences at and for each of the years in the two-year period ended December 31, 2009 and for the nine month periods ended September 30, 2010 and 2009. You should read the summary selected unaudited pro forma consolidated combined financial information presented below in conjunction with the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section, Ampio’s audited financial statements and those of BioSciences for the two-year periods ended December 31, 2009, BioSciences audited financial statements for the year ended September 30, 2010, and Ampio’s unaudited financial statements for the nine months ended September 30, 2010 and 2009, and the related notes contained in this information statement/prospectus.

In April 2009, Life Sciences commenced operations when it purchased assets, principally intellectual property, from BioSciences. In March 2010, Life Sciences merged with a subsidiary of Chay Enterprises, a Colorado corporation. Immediately following the merger, Chay Enterprises reincorporated in Delaware and changed its name to Ampio Pharmaceuticals, Inc. For accounting and financial reporting purposes, Life Sciences was considered the acquirer and the merger was treated as a reverse acquisition. All financial information presented in this information statement/prospectus for periods prior to the Chay merger reflects only that of Life Sciences or the assets purchased from BioSciences, and does not reflect the pre-merger Chay assets, liabilities, or operating results. In addition, all share, per share and related Life Sciences information has been adjusted to take into account the Chay merger.

The selected unaudited pro forma financial data set forth below gives retroactive effect, to the beginning of the periods presented, of the acquisition of BioSciences. We have presented the pro forma consolidated combined financial information below to provide you a better picture of what the combined businesses would have looked like had we owned BioSciences during the periods presented. BioSciences’ fiscal year ends on September 30 and Ampio’s fiscal year ends on December 31. Accordingly, the annual pro forma information presented below includes operating results for the fiscal year ending September 30, 2010 and 2009 for BioSciences and operating results for the fiscal year ending December 31, 2009 and 2008 for Ampio, and are derived from each company’s audited annual financial statements. Ampio had no meaningful operations until its fiscal year ending December 31, 2009. The interim periods presented include unaudited operating results for the nine months ended September 30, 2010 and 2009 for both Ampio and BioSciences. We have eliminated inter-company transactions from the information below. The unaudited interim pro forma consolidated financial statements include all adjustments (consisting only of normal recurring adjustments) that we consider necessary for a fair presentation of the combined companies’ pro forma financial condition and pro forma results of operations as of the dates and for the periods indicated.

The unaudited pro forma consolidated financial data is provided for illustrative purposes only and does not purport to represent what Ampio’s actual consolidated results of operations or Ampio’s financial position would have been had the merger occurred on the dates assumed, nor is it necessarily indicative of future consolidated results of operations or financial position.

The unaudited pro forma combined financial data is based on estimates and various assumptions that Ampio and BioSciences believe are reasonable in these circumstances. The unaudited pro forma adjustments reflect transaction-related items only and are based on currently available information. No estimates of costs associated with the merger have been reflected in the unaudited pro forma consolidated financial statements. Ampio does not anticipate that any cost savings, revenue enhancements or material synergies will be realized in connection with the merger. The unaudited pro forma consolidated financial statements reflect Ampio’s accounting policies, as those accounting policies will govern the combined companies accounting after the merger.


	Pro Forma Consolidated
	Nine Months Ended						Years Ended
	September 30,						September 30, 2010 or December 31,			September 30, 2009 or December 31,
	2010			2009			2009			2008
	(unaudited)			(unaudited)			(unaudited)			(unaudited)

Statement of Operations Data
Revenues

License fees	$	404,410		$	625,000		$	625,000		$	875,000

Royalty fees		—			33,750			—			58,750

Milestone payments		—			1,500,475			—			—

Other revenue		—			111,943			—			111,943

Total revenue		404,410			2,271,168			625,000			1,045,693

Expenses

Research and development		1,516,160			1,430,455			1,222,572			866,113

General and administrative		3,927,251			1,832,413			721,628			1,860,366

Total expenses		5,443,411			3,262,868			1,944,200			2,726,479

Loss from operations		(5,039,001	)		(991,700	)		(1,319,200	)		(1,680,786	)

Other income (expense), net		(7,701	)		(6,817	)		(708	)		(11,862	)

Net income (loss)	$	(5,046,702	)	$	(998,517	)	$	(1,319,908	)	$	(1,692,648	)


Basic and diluted net loss per common share	$	(0.24	)	$	(0.06	)	$	(0.10	)	$	(0.03	)


Weighted average number of common shares outstanding		21,012,613			16,737,546			13,787,650			6,080,000

The following table presents selected consolidated balance sheet data as of September 30, 2010 on an actual basis and on a pro forma basis after giving effect to the acquisition of Biosciences.


	As of September 30, 2010
	Actual			Pro forma
	(unaudited)

Balance sheet data:
Cash, cash equivalents and investments	$	11,836		$	300,032

Working capital (deficit)		(1,541,190	)		(1,068,034	)

Total assets		85,080			8,405,867

Total stockholders’ equity (deficit)		(1,539,305	)		6,933,851

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS - AMPIO

You should read the following discussion and analysis of Ampio’s financial condition and results of operations together with Ampio’s financial statements and the related notes appearing at the end of this information statement/prospectus. Some of the information contained in this discussion and analysis or set forth elsewhere in this prospectus, including information with respect to the merger, our plans and strategy for our business and related financing, includes forward-looking statements that involve risks and uncertainties. You should read the “Risk Factors” section of this information statement/prospectus for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Overview

Ampio is a development stage company engaged in developing innovative, proprietary pharmaceutical drugs and diagnostic products to identify, treat and prevent a broad range of human diseases including metabolic disorders, cancer, and acute and chronic inflammation diseases. Ampio intends to develop proprietary pharmaceutical drugs and diagnostic products which capitalize on its intellectual property that includes assigned patents, pending patent applications, and trade secrets and know-how, some of which may be the subject of future patent applications. Ampio’s intellectual property is strategically focused on three primary areas: new uses for FDA-approved drugs, referred to as repositioned drugs, new molecular entities, or NMEs, and rapid point-of-care tests for diagnosis, monitoring and screening.

Ampio’s predecessor, DMI Life Sciences, Inc., or Life Sciences, was incorporated in Delaware in December 2008 and did not conduct any business activity until April 16, 2009, at which time Life Sciences purchased certain assigned intellectual property (including 107 patents and pending patent applications), business products and tangible property from BioSciences. Life Sciences issued 3,500,000 shares of its common stock to BioSciences, and assumed certain liabilities, as consideration for the assets purchased from BioSciences. The assets Life Sciences acquired from BioSciences had a carrying value of zero, as BioSciences had expensed all of the research and development costs it incurred with respect to the intellectual property purchased by Life Sciences. At the time of the asset purchase, Life Sciences and BioSciences agreed to a non-compete prohibiting both companies from competing with one another anywhere in the world for a period of three years, and also agreed that Life Sciences would receive 10% of royalty license revenues received by BioSciences from a drug developed by BioSciences (and as to which BioSciences retained ownership) to treat premature ejaculation, which we refer to as the PE drug.

In March 2010, Life Sciences was merged with a subsidiary of Chay Enterprises, Inc., a public company then traded on the OTC Bulletin Board. Chay Enterprises had minimal operations prior to the time of this merger, and like similar entities was referred to as a public shell. As a result of this merger, Life Sciences shareholders became the controlling shareholders of Chay Enterprises and the former sole officer and director of Chay Enterprises appointed a majority of our current management team to their present positions. We were reincorporated in Delaware at that time as Ampio Pharmaceuticals, Inc. and commenced trading on the OTC Bulletin Board as Ampio Pharmaceuticals, Inc. in late March 2010 following approval from FINRA and the assignment of a new trading symbol.

In April 2010, Ampio announced the execution of a letter of intent to acquire BioSciences. The purpose of this transaction was to unify our management team and ownership, as our chief financial officer and a number of our non-executive officers were then serving also as officers and employees of BioSciences. For example, Dr. Bar-Or, who is a member of the Ampio board of directors and Ampio’s chief scientific officer, was a member of the board of directors of BioSciences until April 2010 and formerly served as an executive officer of BioSciences. Dr. Bar-Or is also the largest shareholder of BioSciences until immediately prior to the closing of the BioSciences’ acquisition, at which time Dr. Bar-Or and the other executive and non-executive officers of BioSciences will donate to the capital of BioSciences all of the Class B BioSciences common stock owned by them to the capital of BioSciences. This donation to capital will increase substantially the ownership percentage of the non-management shareholders of BioSciences, many of whom have been BioSciences shareholders for a number of years.

In addition, when Ampio’s predecessor purchased intellectual property from BioSciences in April 2009, a transaction discussed further below, BioSciences received 3,500,000 shares of Ampio common stock that represented approximately 20% of Ampio’s outstanding shares. Because of this common ownership and the common management described above, Ampio concluded that an acquisition of BioSciences would remove the potential for conflicts of interest between Ampio and BioSciences, and would provide Ampio with the opportunity to seek a new licensing partner for Zertane. That drug was returned to BioSciences in June 2010 by a major pharmaceutical company that had previously licensed the PE drug.

Known Trends or Future Events

Ampio has not generated any revenues since its inception in December 2008. The assets Ampio purchased from BioSciences in April 2009 did generate minimal revenues prior to their acquisition. Since purchasing those assets from BioSciences in April 2009, which included patents, pending patent applications, proprietary know-how and minimal fixed assets, Ampio has engaged in organizational activities; conducted a private placement pursuant to which we raised approximately $1.5 million in additional capital; added to our management team; completed the merger with Chay Enterprises; and signed the letter of intent to acquire BioSciences. As reflected in the BioSciences’ historical financial information included in this prospectus, BioSciences generated approximately $3.6 million in revenues in fiscal 2008, fiscal 2009, and fiscal 2010 from the license of the PE drug to a large pharmaceutical concern. That license was terminated by the pharmaceutical company in June 2010, at which time BioSciences reacquired all rights to the PE drug.

Unless Ampio secures a collaborator for one or more of its product candidates and generates license revenues, Ampio will need additional capital in order to continue to implement its business strategy. Ampio cannot assure you that it will secure such financing or that it will be adequate to execute our business strategy. Even if Ampio obtains this financing, it may be costly and may require Ampio to agree to covenants or other provisions that will favor new investors over existing shareholders. Due to the time required to conduct clinical trials and obtain regulatory approval for any of Ampio’s product candidates, Ampio anticipates it will be some time before it generates substantial revenues, if ever. Ampio expects to generate operating losses for the foreseeable future, but intends to limit the extent of these losses by entering into co-development or collaboration agreements with one or more strategic partners. Ampio does not currently have any such agreements in effect.

Since Ampio’s inception, it has incurred significant net losses and Ampio expects to continue to experience significant losses as it invests in product candidate development, clinical trials, regulatory compliance, and building a portfolio of proprietary intellectual property. As of September 30, 2010, Ampio had a deficit accumulated during the development stage of $6.8 million. Ampio incurred pro forma combined net losses with BioSciences of $5.05 million in the nine months ended September 30, 2010.

Significant Accounting Policies and Estimates

Ampio’s financial statements have been prepared in accordance with accounting policies generally accepted in the United States of America. The preparation of the financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. On an on-going basis, management evaluates its estimates and judgments, including those related to recoverability of long-lived assets and contingencies. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. The methods, estimates, and judgments used by Ampio in applying these most critical accounting policies have a significant impact on the results Ampio reports in its financial statements.

Cash and Cash Equivalents

Ampio considers all highly liquid instruments purchased with an original maturity of three months or less to be cash equivalents. Cash equivalents consist primarily of money market investments. Ampio may maintain balances from time to time in excess of the federally insured limits.

Patents

Costs of establishing patents consisting of legal fees paid to third parties and related costs are currently expensed as incurred. Ampio will continue this practice unless it can demonstrate that such costs add economic value to its business, in which case Ampio will capitalize such costs as part of intangible assets. The primary consideration in making this determination is whether or not Ampio can demonstrate that such costs have, in fact, increased the economic value of Ampio’s intellectual property. Legal and related costs which do not meet the above criteria will be expensed as incurred. A portion of the purchase price of BioSciences has been allocated to intellectual property acquired through the merger, meaning this portion of the purchase price has been capitalized as a result of the acquisition.

In-process Research and Development

A portion of the purchase price of BioSciences will be allocated to in-process research and development acquired through the merger. As a result, this portion of the purchase price will be capitalized. Ampio will periodically assess the fair value of the in-process research and development and recognize an impairment if the carrying value exceeds the fair value.

Stock-Based Compensation

Ampio accounts for share-based payments by recognizing compensation expense based upon the estimated fair value of the awards on the date of grant. Ampio determines the estimated grant fair value using the Black-Scholes option pricing model and recognizes compensation costs ratably over the vesting period using the straight-line method. Common stock issued in exchange for services is recorded at the fair value of the common stock at the date at which Ampio becomes obligated to issue the shares. The value of the shares is expensed over the service period.

Income Taxes

Ampio uses the liability method of accounting for income taxes. Under this method, Ampio recognizes deferred assets and liabilities based on the differences between the tax basis of assets and liabilities and their reported amounts in the financial statements that will result in taxable or deductible amounts in future years. Ampio establishes a valuation allowance for all deferred tax assets for which there is uncertainty regarding realization.

Research and Development

Research and development costs are expensed as incurred. These costs consist primarily of expenses for personnel engaged in the design and development of product candidates; the scientific research necessary to produce commercially viable applications of our proprietary drugs or compounds; early stage clinical testing of product candidates or compounds; expenditures for design and engineering of the ORP product; and development equipment and supplies, facilities costs and other related overhead. Through our relationship with TRLLC, a related party, the bulk of these costs are incurred by TRLLC and reimbursed by Ampio to TRLLC.

General and Administrative Expenses

General and administrative expenses consist primarily of personnel-related expense related to Ampio’s executive, operations, human resource, and information technology functions, as well as fees for professional services and facility costs. Professional services consist principally of external legal, accounting and other consulting services. Ampio expects general and administrative expenses to increase as it incurs additional costs related to conducting clinical trials, continuing development of product candidates and, if clinical trials are successful, applying for regulatory approvals and commercializing product candidates. As Ampio is a publicly traded company, Ampio also expects the costs associated with public status will increase, including legal fees, accounting fees and costs of compliance with securities laws and other regulations. In addition, Ampio expects to incur additional costs as it hires personnel and enhances infrastructure to support the anticipated growth of its business.

Results of Operations—Nine Months Ended September 30, 2010 and 2009

Revenue

Ampio is a development stage enterprise and has not generated material revenue in its operating history.

Expenses

Research and Development

Research and development costs were $1.4 million and $.6 million in the nine months ended September 30, 2010 and 2009, respectively. Research and development costs consist of the research and development of patents and intellectual property as well as drug development and clinical trials. The increase in expenses in 2010 relates to the increase in business activity as Ampio did not begin incurring operating expenses until April 2009. Ampio has not capitalized any of its research and development costs. Research and development costs are summarized as follows:


	Nine Months ended September 30,
	2010		2009
Stock-based compensation		323,000		—
Patent costs		252,000		91,000
Labor		606,000		327,000
Consultants		107,000		105,000
All other		128,000		84,000

	$	1,416,000	$	607,000

The increase in expenses in from the third quarter of 2009 to the third quarter of 2010 resulted from stock-based compensation costs in 2010. The increase in costs from the nine months ended September 30, 2010 over the nine months ended September 30, 2009 occurred because of the 2010 stock-based compensation and because Ampio did not have operations prior to April 2009.

General and Administrative

General and administrative costs are summarized as follows:


	Nine Months Ended September 30, 2010		Nine Months Ended September 30, 2009
Stock-based compensation	$	2,260,000	$	—
Professional fees		685,000		17,000
Labor		491,000		263,000
Occupancy, travel and other		203,000		36,000

	$	3,639,000	$	316,000

Professional fees consist primarily of legal, audit and accounting costs related to the Chay Enterprises merger, public company compliance costs, and legal fees related to intellectual property protection. Labor consists of compensation costs attributable to Ampio’s administrative employees. The increase in expenses in 2010 relates to the increase in business activity as Ampio did not begin incurring operating expenses until April 2009.

Net Cash Used in Operating Activities

During the nine months ended September 30, 2010, Ampio’s operating activities used $1,884,000 in cash. The use of cash reflected a $5,072,000 net loss, non-cash charges of $2,584,000 for common stock issued for services and stock based compensation, an increase in accounts payables of $431,000 relating to professional fees and other expenses, an increase in accrued salaries of $192,000 resulting from deferral of salaries by Ampio’s management team, and changes in other assets and current liabilities which used $20,000 in cash.

Net Cash from Financing Activities

Net cash provided by Ampio’s financing activities was $1,827,000 for the nine months ended September 30, 2010. During this period, Ampio received $630,000 in loans from related parties and $1,367,000 from the sale and

subscription of common stock. Immediately prior to the Chay merger, Ampio made advances of $150,000 to stockholders who were also executive and non-executive officers of Ampio. Those advances are non-interest bearing and due on demand. Pursuant to the terms of the Chay merger agreement, Ampio was also required to place $125,000 in restricted cash into an escrow account, $105,000 of which was released during the nine months ended September 30, 2010. The escrow account terminated on December 31, 2010 by its terms under the terms of the agreement with Chay.

Results of Operations—Year Ended December 31, 2009

Year Ended December 31, 2009

Revenue

Ampio is a development stage enterprise and has not yet generated revenue.

Expenses

Research and Development

Research and development costs for the year ended December 31, 2009 represents a full year’s worth of costs related to the research and development of patents and intellectual property. Ampio did not capitalize any of its research and development costs during the year ended December 31, 2009.

General and Administrative

General and administrative costs for the year ended December 31, 2009 represents a full year’s worth of costs for Ampio’s development stage enterprise.

Net Cash Used in Operating Activities

During the twelve months ended December 31, 2009, Ampio’s operating activities used $1,372,000 of cash. This reflected a $1,512,000 net loss, an increase in accounts payables of $80,000, accrued salaries of $73,000 and accrued interest payable of $1,000, offset with increases in prepaid expenses of $7,000 and a related party receivable of $7,000. All of these changes relate to the assumption of assets and liabilities in the asset purchase transaction with BioSciences.

Net Cash from Financing Activities

Net cash provided by financing activities was $1,444,000 for the twelve months ended December 31, 2009. During this period, Ampio received $200,000 in proceeds from a related note payable and proceeds from the sale of common and preferred stock of $1,292,000, offset by payment of assumed liabilities of $48,000.

Results of Operations—Year Ended September 30, 2008 and Period From October 1, 2008 through April 15, 2009 of the BioSciences Assets Sold

Ampio’s predecessor, Life Sciences, was formed in December 2008 and had no activity prior to the acquisition of assets from BioSciences. Life Sciences entered into an asset purchase agreement during 2009 with BioSciences, under which Life Sciences acquired office and lab equipment, cell lines and intellectual property including patents and license agreements and assumed liabilities. This transaction was accounted for as a reverse merger and the assets acquired and liabilities assumed were recorded at predecessor cost. The assets had $0 carrying value on the predecessor financial statements and liabilities totaled $252,670. The carve-out financial statements of the predecessor have been included in this information statement/prospectus in order to provide financial information covering two years’ of operations of the assets acquired. The assets acquired represented a discrete activity within BioSciences and management of BioSciences was able to provide a reasonable allocation of the activities within BioSciences related to the assets acquired. The acquisition occurred on April 16, 2009. Therefore, the carve-out financial information includes the periods prior to the acquisition for the most recent fiscal year end, September 30, 2008, and the period from October 1, 2008 through April 15, 2009. The financial statements of BioSciences assets sold represent the activities of all assets transferred to Life Sciences for the period ended April 15, 2009 and the year ended September 30, 2008. These financial statements include all costs of doing business related to the assets acquired and liabilities assumed, including the development and research of proprietary pharmaceutical drugs and diagnostic products that inured to the benefit of Life Sciences, regardless of whether the research was successful or not. The activities of BioSciences performed by TRLLC under a research agreement with BioSciences that related to the BioSciences assets sold have also been included in the financial statements for the BioSciences assets sold.

Liquidity and Capital Resources

Ampio had unrestricted cash of $12,000 at September 30, 2010, and an additional $20,000 in restricted cash. Ampio raised approximately $1,500,000 in a private placement of common stock conducted from November 2009 to March 2010. As of September 30, 2010, Ampio had $400,000 in notes payable to shareholders, which mature on the earlier of a minimum financing of $5,000,000 or January 31, 2011. Of these notes payable, $300,000 was owed to BioSciences and will be cancelled upon consummation of the BioSciences acquisition. During August 2010, two of our directors and an affiliate of one of those directors loaned an additional $430,000 to Ampio. The loans mature at the earlier of a minimum financing of $10,000,000 or January 31, 2011. In connection with these loans, we issued to the lenders a total of 21,500 warrants to purchase shares of our common stock. The exercise price will be equal to the per-share price of shares Ampio sells in a public offering. In November 2010, we raised an additional $1.39 million from 18 accredited investors, a majority of whom were already shareholders of Ampio. These funds were received on issuance of mandatorily convertible debentures which will automatically convert into Ampio common stock at the earlier of (i) completion of an underwritten offering of $10 million or more, and (ii) March 31, 2011. The conversion price will be the lower of $1.75 per share or the price paid by investors in the underwritten offering. In connection with the issuance of the debentures, we issued to the debenture purchasers an aggregate of 157,829 warrants to purchase shares of Ampio common stock, which may be adjusted if the conversion price of the debentures is less than $1.75 per share. Additional loans from our shareholders may be a source of short-term liquidity. However, there is currently no formal commitment from our shareholders to provide additional short-term financing.

Off Balance Sheet Arrangements

Ampio does not have off-balance sheet arrangements, financings, or other relationships with unconsolidated entities or other persons, also known as “variable interest entities.”

Contractual Obligations

As condition of the merger with Chay Enterprises, or Chay, Ampio and certain of our shareholders, referred to as the guarantors, and the principal shareholders of Chay entered into a securities put and guarantee agreement. The agreement provided that if Ampio was not successful in obtaining a minimum of $5.0 million in financing within 150 days after the closing of the merger, the principal shareholders of Chay had the right to put back to Ampio all of the Chay common stock then owned by the Chay principal shareholders for a put price of $250,000, subject to adjustment. Under the agreement, the guarantors agreed to jointly guarantee the payment of the put price by Ampio if the put right becomes exercisable in accordance with its terms. In addition, Ampio placed into escrow a cash deposit of $125,000 that was to be paid to the Chay principal shareholders in the event the put right became exercisable by its terms. The Chay principal shareholders released $105,000 of the funds in escrow prior to December 31, 2010. As of December 31, 2010, the securities and put agreement expired by its terms.

Ampio entered into a clinical research agreement with a hospital and a physician investigator effective April 1, 2010. Under the terms of the clinical research agreement, we agreed to fund and support a clinical trial to a minimum of $600,000, based on a budget to be agreed upon by the parties. We have paid an initial down payment of $50,000 and subsequently paid an additional $25,000, however, the budget has not yet been finalized. The clinical research agreement will remain in full force until the clinical trial is completed or until terminated by the parties.

The following table summarizes contractual obligations and borrowings as of December 31, 2010 and the timing and effect that such commitments are expected to have on Ampio’s liquidity and capital requirements in future periods. Ampio expects to fund these commitments primarily with existing cash balances and from additional financing obtained through the sale of equity or debt instruments.

Contractual Obligations


	Total		Due in Less than 1 Year		Due 1–3 Years		Due 3–5 Years		More than 5 years
Sponsored Research Agreement with Related Party⁽¹⁾	$	1,285,467	$	350,582	$	701,164	$	233,721		—
Related Party Debt Obligations⁽²⁾		1,045,971		1,045,971		—		—		—
Clinical Research Obligation⁽³⁾		525,000		525,000		—		—		—

	$	2,856,438	$	1,921,553	$	701,164	$	233,721	$	—

(1)

Represents amounts due under our sponsored research agreement with Trauma Research LLC, or TRLLC. This commitment may increase if Ampio’s board of directors requests TRLLC to perform additional research and development activities. Such a request is expected to be made only in conjunction with Ampio’s receipt of additional financing. This agreement may be terminated without cause by either party with 180 days written notice.

(2)	For more information on our debt obligations, see “Related Party Transactions,” which is included in Annex C to this information statement/prospectus.

(3)	Represents obligations under a clinical research agreement with a hospital and physician investigator.

Quantitative and Qualitative Disclosures About Market Risk

Ampio’s business is not currently subject to material market risk related to financial instruments, equity or commodities. Ampio’s outstanding indebtedness is limited currently to fixed rate instruments.

Recently Issued Accounting Pronouncements

In June 2009, the, Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards (“SFAS”) No. 168, “The FASB Accounting Standards Codification™ and the Hierarchy of Generally Accepted Accounting Principles – a replacement of FASB Statement No. 162” (“SFAS 168”). The FASB Accounting Standards Codification™, (“Codification” or “ASC”) became the source of authoritative GAAP recognized by the FASB to be applied by nongovernmental entities. Rules and interpretive releases of the SEC under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. On the effective date of SFAS 168, the Codification superseded all then-existing non-SEC accounting and reporting standards. All other non-grandfathered non-SEC accounting literature not included in the Codification became non-authoritative.

Following SFAS 168, the FASB will no longer issue new standards in the form of Statements, FASB Staff Positions, or Emerging Issues Task Force Abstracts; instead, it will issue Accounting Standards Updates (ASUs). The FASB will not consider ASCs as authoritative in their own right; rather, these updates will serve only to update the Codification, provide background information about the guidance, and provide the bases for conclusions on the change(s) in the Codification. SFAS No. 168 is incorporated in ASC Topic 105, “Generally Accepted Accounting Principles.” Ampio adopted SFAS No. 168 for the quarter ended September 30, 2009, and will provide reference to both the Codification topic reference and the previously authoritative references related to Codification topics and subtopics, as appropriate.

New accounting pronouncements to be adopted

In June 2009, the FASB issued SFAS No. 167, Amendments to FASB Interpretation No. 46(R), (codified by ASU No. 2009-17 issued in December 2009). The standard amends FIN No. 46(R) to require a company to analyze whether its interest in a variable interest entity (“VIE”) gives it a controlling financial interest. A company must assess whether it has an implicit financial responsibility to ensure that the VIE operates as designed when determining whether it has the power to direct the activities of the VIE that significantly impact its economic performance. Ongoing reassessments of whether a company is the primary beneficiary are also required by the standard. SFAS No. 167 amends the criteria to qualify as a primary beneficiary as well as how to determine the existence of a VIE. The standard also eliminates certain exceptions that were available under FIN No. 46(R). This statement will be effective as of the beginning of each reporting entity’s first annual reporting period that begins after November 15, 2009 (i.e. our fiscal year ending December 31, 2010). Earlier application is prohibited. Comparative disclosures will be required for periods after the effective date. It is expected that the adoption of this statement will have no material effect on Ampio’s consolidated financial statements.

In October 2009, the FASB issued ASU No. 2009-15—Accounting for Own-Share Lending Arrangements in Contemplation of Convertible Debt Issuance or Other Financing. ASU 2009-15 amends ASC 470-20, Debt with Conversion and Other Options, to provide accounting and reporting guidance for own-share lending arrangements issued in contemplation of convertible debt issuance. ASU 2009-15 is effective for fiscal year beginning on or after December 15, 2009 with retrospective application required.

In January 2010, the FASB issued the following ASUs that may become applicable to Ampio:

•

ASU No. 2010-02—Consolidation (Topic 810): Accounting and Reporting for Decreases in Ownership of a Subsidiary. This update amends Subtopic 810-10 and related guidance to clarify that the scope of the decrease in ownership provisions of the Subtopic and related guidance applies to (i) a subsidiary or group of assets that is a business or nonprofit activity; (ii) a subsidiary that is a business or nonprofit activity that is transferred to an equity method investee or joint venture; and (iii) an exchange of a group of assets that

constitutes a business or nonprofit activity for a noncontrolling interest in an entity, but does not apply to: (i) sales of substantial real estate; and (ii) conveyances of oil and gas mineral rights. The amendments in this update are effective beginning the period that an entity adopts FAS 160 (now included in Subtopic 810-10).

•

ASU No. 2010-05—Compensation—Stock Compensation (Topic 718): Escrowed Share Arrangements and the Presumption of Compensation. This update simply codifies EITF Topic D-110, Escrowed Share Arrangements and the Presumption of Compensation issued on June 18, 2009. In EITF Topic No. D-110, SEC staff clarified that entities should consider the substance of the transaction in evaluating whether the presumption of compensation may be overcome, including whether the transaction was entered into for a reason unrelated to employment, such as to facilitate a financing transaction. In that situation, the staff generally believes that the escrowed shares should be reflected as a discount in the allocation of proceeds.

•

ASU No. 2010-06—Fair Value Measurements and Disclosures (Topic 820): Improving Disclosures about Fair Value Measurements. This update amends Subtopic 820-10 that requires new disclosures about transfers in and out of Levels 1 and 2 and activity in Level 3 fair value measurements. This update also amends Subtopic 820-10 to clarify certain existing disclosures. The new disclosures and clarifications of existing disclosures are effective for interim and annual reporting periods beginning after December 15, 2009, except for the disclosures about purchases, sales, issuances, and settlements in the roll forward of activity in Level 3 fair value measurements, which are effective for fiscal year beginning after December 15, 2010.

In April 2010, the FASB issued an accounting standards update which provides guidance on the criteria to be followed in recognizing revenue under the milestone method. The milestone method of recognition allows a vendor who is involved with the provision of deliverables to recognize the full amount of a milestone payment upon achievement, if, at the inception of the revenue arrangement, the milestone is determined to be substantive as defined in the standard. The guidance is effective on a prospective basis for milestones achieved in fiscal years and interim periods within those fiscal years, beginning on or after June 15, 2010. The adoption of this guidance is not expected to have a material impact on Ampio’s financial statements.

On July 21, 2010, the FASB issued ASU 2010-20 “Receivables (Topic 310) — Disclosures about the Credit Quality of Financial Receivables and the Allowance for Credit Losses.” ASU 2010-20 requires disclosure of additional information to assist financial statement users to understand more clearly an entity’s credit risk exposures to finance receivables and the related allowance for credit losses. ASU 2010-20 is effective for all public companies for interim and annual reporting periods ending on or after December 15, 2010, with specific items, such as the allowance rollforward and modification disclosures, effective for periods beginning after December 15, 2010. Ampio does not expect the adoption of this new guidance to have an impact on its financial position, cash flows or results of operations.

Ampio expects that the adoption of the above updates will not have any significant impact on its financial position and results of operations. Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on Ampio’s consolidated financial statements upon adoption.

Impact of Inflation

In general, Ampio believes that, over time, it will be able to increase prices to counteract the majority of the inflationary effects of increasing costs.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS - BIOSCIENCES

You should read the following discussion and analysis of BioSciences financial condition and results of operations together with BioSciences’ financial statements and the related notes appearing at the end of this information statement/prospectus. Some of the information contained in this discussion and analysis or set forth elsewhere in this information statement/prospectus, including information with respect to the merger, includes forward-looking statements that involve risks and uncertainties. You should read the “Risk Factors” section of this information statement/prospectus for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Overview and Background

BioSciences is a privately held, clinical stage company now engaged in development of Zertane, a proprietary pharmaceutical product candidate developed to treat male sexual dysfunction, specifically premature ejaculation, or PE. BioSciences was formed in 1990 by Dr. Bar-Or, now Ampio’s chief scientific officer. Bruce G. Miller, now Ampio’s chief financial officer, joined BioSciences in 1992 and was named chief executive officer of BioSciences later in 1992. From 1990 through March 2009, BioSciences engaged in development of a variety of pharmaceutical product candidates and compounds that research indicated could be used to treat inflammatory conditions, including metabolic disorders and diabetic complications.

In April 2009, BioSciences entered into an asset purchase agreement with Life Sciences, under which it sold all of its intellectual property except rights to Zertane, and office and lab equipment to Life Sciences for assumption of $262,670 in liabilities and 3,500,000 shares of common stock of Life Sciences. The assets had no book value at the date of the asset sale, as BioSciences had expensed all of its research and development costs as well as its intellectual property legal fees, patent application and patent maintenance expenses. At the time of the asset sale, BioSciences and Life Sciences agreed to a non-compete prohibiting both companies from competing with one another anywhere in the world for a period of three years, and also agreed that Life Sciences would receive 10% of royalty license revenues received by BioSciences from Zertane, subject to Life Sciences providing additional funding for Zertane’s continued development.

The asset sale resulted in a deemed contribution to BioSciences by its stockholders in the amount of $262,670, representing the historical value of the assets transferred to Life Sciences as the transaction was a recapitalization of Life Sciences.

Prior to April 2009, BioSciences also had license agreements with the Institute for Molecular Medicine, Inc., or IMM, a nonprofit research organization affiliated with Dr. Bar-Or. Under the license agreements, BioSciences paid the costs associated with maintaining intellectual property subject to the license agreements. Under the terms of one of the license agreements concerning certain methylphenidate derivatives, BioSciences was given the right to deduct twice the amounts it paid for these purposes from any royalties or other fees that may become due to the IMM under the license agreements. BioSciences’ obligations to IMM under the license agreements were assumed by Life Sciences in April 2009 in conjunction with the asset sale.

Prior to April 2009, BioSciences had a Sponsored Research Agreement, or SPA, with Trauma Research LLC, or TRLLC, a research organization affiliated with Dr. Bar-Or. Under the terms of the SPA, BioSciences was to provide personnel and equipment with an equivalent value of $300,000 per year and to make monthly equipment rental payments of $7,236 on behalf of TRLLC. In exchange, TRLLC assigned any intellectual property rights to BioSciences for product candidates or compounds invented as a result of performing research for BioSciences. The obligations under the SPA were effectively transferred to Life Sciences through the execution of a new sponsored research agreement between TRLLC and Life Sciences in April 2009 in conjunction with the asset sale. Accordingly, BioSciences financial statements reflect significant reductions in research and development, as well as general and administrative, expenses since April 2009.

The Zertane License and its Termination

BioSciences granted an option to license Zertane to a large pharmaceutical firm in 2007, and the option was exercised in January 2009. The pharmaceutical firm then conducted two large Phase III clinical trials in multiple countries and clinical sites in Europe which were discontinued when the licensee terminated the license agreement in June 2010, which BioSciences understands to have occurred due to a change in the licensee’s strategic direction as a result of the licensee being acquired by another company.

At that time, BioSciences regained all rights to develop, license and seek regulatory approval to market Zertane worldwide. BioSciences has since obtained the clinical trial data from the pharmaceutical company and its CRO, and expects to complete a preliminary review of this data in January 2011. Once the data is analyzed, BioSciences will determine how the results of the trials may affect future licensing opportunities and whether dosing or other adjustments must be made in any future trials. BioSciences has applied for patent protection for a combination of Zertane and an erectile dysfunction, or ED, medicine to offer male patients a single oral medication that will treat both PE and ED. A combination drug would address the significant co-morbid ED and PE population.

Significant Accounting Policies and Estimates

BioSciences’ financial statements have been prepared in accordance with accounting policies generally accepted in the United States of America. The preparation of the financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. On an on-going basis, management evaluates its estimates and judgments, including those related to recoverability of long-lived assets and contingencies. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. The methods, estimates, and judgments used by BioSciences in applying these most critical accounting policies have a significant impact on the results BioSciences reports in its financial statements.

Cash and Cash Equivalents

BioSciences considers all highly liquid instruments purchased with an original maturity of three months or less to be cash equivalents. Cash equivalents consist primarily of money market investments. BioSciences may maintain balances from time to time in excess of the federally insured limits.

Patents and Patent Applications

Costs of establishing patents consisting of legal fees paid to third parties and related costs are expensed as incurred until such time as the patent is deemed viable and will produce revenue.

Revenue Recognition

Revenues from royalties and license agreements are recognized when all of the following criteria have been met: (a) persuasive evidence of an arrangement exists, (b) delivery has occurred or services have been rendered, (c) the price is fixed or determinable, and (d) collectability is reasonably assured. Milestone payments are received and earned in accordance with the terms of the specific contracts and BioSciences providing the required information in accordance with the terms of the contracts. Revenue is recognized upon completion of each milestone.

Stock-Based Compensation

BioSciences accounts for share-based payments by recognizing compensation expense based upon the estimated fair value of the awards on the date of grant. BioSciences determines the estimated grant fair value using the Black-Scholes option pricing model and recognizes compensation costs ratably over the vesting period using the straight-line method.

Income Taxes

BioSciences uses the liability method of accounting for income taxes. Under this method, BioSciences recognizes deferred assets and liabilities based on the differences between the tax basis of assets and liabilities and their reported amounts in the financial statements that will result in taxable or deductible amounts in future years. BioSciences establishes a valuation allowance for all deferred tax assets for which there is uncertainty regarding realization. BioSciences adopted the guidance in ASC 740-10, Accounting for Uncertainty in Income Taxes, in December 2009, the adoption of which was not significant to BioSciences financial position and results of operations.

Research and Development

Research and development costs are expensed as incurred.

Results of Operations—Fiscal Year Ended September 30, 2010 and 2009

Revenue

BioSciences received license fees totaling $625,000 in fiscal 2010, a decrease of approximately $1.8 million from the $2.4 million received in license fees, royalty fees, and milestone payments received in fiscal 2009. All 2010 license fees and 2009 license fees, royalty fees, and milestone payments were received from the pharmaceutical company that executed an option to license Zertane in January 2009. The decrease in revenues from 2009 to 2010 reflects the cancellation of the license of Zertane by the collaborator in June 2010.

BioSciences also received other miscellaneous revenue totaling $111,943 in 2009. No such revenue was received in 2010.

Expenses

Research and Development

Research and development costs were $152,202 and $866,113 in fiscal 2010 and fiscal 2009, respectively. The significant reduction in research and development costs in fiscal 2010 reflects the April 2009 asset sale to Life Sciences, which eliminated all research and development activities except those related to Zertane. Research and development costs in future periods are expected to reflect fiscal 2010’s level, which approximated research and development costs in 2008.

General and Administrative

General and administrative costs totaled $280,493 in fiscal 2010 and approximately $7.2 million in fiscal 2009. General and administrative costs in fiscal 2009 included approximately $6.7 million in common stock issued for services and cell lines. The remaining $500,000 in fiscal 2009 general and administrative costs, as well as general and administrative costs for fiscal 2010, reflect administrative employee compensation, professional fees, and legal fees related to intellectual property protection. General and administrative expenses fell in fiscal 2010 as a result of the absence of issuance of common stock for services and cell lines, as well as the asset sale to Life Sciences, which commenced employing BioSciences’ former administrative employees and paying patent application and maintenance fees for non-Zertane intellectual property formerly paid by BioSciences. BioSciences expects that general and administrative costs will decline in fiscal 2011 from fiscal 2010 levels, as fiscal 2010 general and administrative costs necessarily included a partial year’s general and administrative expenses attributable to the assets sold to Life Sciences in April 2009.

Net Cash Used in Operating Activities

During fiscal 2010, BioSciences operating activities used $991,626 in cash. The use of cash reflected primarily net income of $154,562, a decrease in accounts payable of $484,233 relating to professional fees and other expenses, and a decrease in deferred revenue of $625,000.

Net Cash Used in Investing Activities

During fiscal 2010, BioSciences advanced $300,000 to Ampio, which represents the entirety of net cash paid for investing activities.

Net Cash from Financing Activities

Net cash used in BioSciences’ financing activities in fiscal 2010 was $122,382. This amount consists of payments on notes payable of $100,000 and payments on capital leases for the remainder.

Results of Operations—Fiscal Year Ended September 30, 2009 and 2008

Revenue

BioSciences received license fees, royalty fees and milestone payments totaling $2.4 million in fiscal 2009, a significant increase from $575,000 license fees and royalty fees received in fiscal 2008. All 2009 license fees, royalty fees and milestone payments and 2008 license fees and royalty fees were received from the pharmaceutical company that executed an option to license Zertane in January 2009. The majority of the fiscal 2009 increase in revenues was due to the receipt of approximately $1.5 million in milestone payments upon the Zertane clinical trials reaching predetermined milestones. No comparable milestones were achieved in fiscal 2008 and no milestone payments were received in 2008.

BioSciences also received other miscellaneous revenue totaling $111,943 in 2009. Other revenue totaled $36,865 in 2008.

Expenses

Research and Development

Research and development costs were $866,113 in fiscal 2009 and $153,397 in fiscal 2008, respectively. The significant increase in research and development costs in fiscal 2009 reflects primarily the receipt of license fees and royalty fees in late fiscal 2008, and receipt of license fees, royalty fees, and milestone payments in fiscal 2009, which provided cash to fund increased research and development activities in fiscal 2009 that BioSciences had deferred in fiscal 2008. Research and development costs in fiscal 2009 also increased as BioSciences began more intensive clinical development activities for Optina and Vasaloc, the rights to which were sold to Life Sciences in April 2009.

General and Administrative

General and administrative costs totaled approximately $7.2 million in fiscal 2009 and approximately $1.0 million in fiscal 2008. General and administrative costs in fiscal 2009 included approximately $6.7 million in common stock issued for services and cell lines. The remaining $500,000 in fiscal 2009 general and administrative costs, as well as general and administrative costs for fiscal 2008, reflect administrative employee compensation, professional fees, and legal fees related to intellectual property protection.

Net Cash Provided by Operating Activities

During fiscal 2009, BioSciences’ operating activities provided approximately $1.6 million in cash. The cash provided by operating activities reflected primarily the net loss of approximately $5.6 million and a decrease in accounts payable of $297,623, which were offset and exceeded principally by the sum of common stock issuances for services and cell lines of approximately $6.7 million, receipt of $625,000 cash accounted for as deferred revenue, and an increase in accrued liabilities of $110,546.

Net Cash from Financing Activities

Net cash provided by BioSciences’ financing activities in fiscal 2009 was $77,078. This amount consists of issuances of notes payable of $125,000, offset by payments on capital leases of $17,922 and advances of $30,000.

Liquidity and Capital Resources

BioSciences had cash and cash equivalents of $288,196 at September 30, 2010. In October and November 2010, BioSciences made advances to Ampio of $50,000 and $165,971, respectively. In combination with the $300,000 previously advanced by BioSciences to Ampio, BioSciences is owed an aggregate of $515,971, together with accrued interest at the rate of 6% per annum. The notes evidencing these advances are due on demand. The notes will be effectively cancelled as a result of the merger, which will result in the elimination of inter-company indebtedness. BioSciences currently has no cash requirements as all of its administrative employees are performing services for BioSciences while being paid by Ampio. Because the merger will likewise result in the elimination of any inter-company benefits conferred on BioSciences as a result of Ampio compensating its employees while such persons provide services to BioSciences, Ampio has not accrued a related party account receivable for such services, and BioSciences has not accrued a related party account payable.

Off Balance Sheet Arrangements

BioSciences does not have off-balance sheet arrangements, financings, or other relationships with unconsolidated entities or other persons, also known as “variable interest entities.”

Contractual Obligations

BioSciences has no contractual obligations outstanding as of September 30, 2010.

Quantitative and Qualitative Disclosures About Market Risk

BioSciences’ business is not currently subject to material market risk related to financial instruments, equity or commodities.

THE MERGER

General

On August 24, 2010, the BioSciences board of directors unanimously approved the merger agreement that provides for the acquisition by Ampio of BioSciences through a merger of Merger Sub, a newly formed and wholly-owned subsidiary of Ampio, with and into BioSciences. Effective December 30, 2010, the BioSciences board of directors unanimously approved the amended merger agreement pursuant to which this information statement/prospectus is to be issued following SEC review. The BioSciences shareholder consent will thereafter be signed and the merger closed. After the merger with Merger Sub, BioSciences will be the surviving entity and the separate corporate existence of Merger Sub will cease. At the effective time, each share of BioSciences common stock (other than shares owned by BioSciences, Ampio, Merger Sub or Ampio’s other subsidiaries) will be converted into the right to receive shares of Ampio common stock. The Class B common stock of BioSciences will not participate in the Merger Stock, as those BioSciences shares of common stock will be donated to the capital of BioSciences immediately prior to the closing of the merger. In addition, the 3,500,000 shares of Ampio common stock owned by BioSciences will be donated to the capital of Ampio immediately before the effective time, meaning these shares will not be outstanding at the time of the merger. The merger agreement provides that the Merger Stock will not be subject to adjustment for price variations in Ampio’s common stock, but will be adjusted appropriately if, during the period between the date of the amended merger agreement and the effective time of the merger, the outstanding shares of BioSciences common stock or Ampio common stock are changed in any way by reason of any reclassification, recapitalization, stock split or combination, exchange or readjustment of shares, or any stock dividend on any such outstanding shares with a record date during such period, or any other similar event.

Merger Consideration

The aggregate consideration that will be paid by Ampio to BioSciences shareholders in the merger is 8,667,905 shares of Ampio common stock. This consideration includes the consideration payable to holders of in-the-money BioSciences stock options and warrants outstanding immediately prior to the effective time of the merger, and consideration payable to holders of two BioSciences promissory notes.

BioSciences Common Stock

At the effective time of the merger, each share of BioSciences common stock will entitle the holder thereof to receive the merger consideration, which will consist of the Ampio common stock. The Ampio common stock consideration refers to the number of shares of Ampio common stock payable in the merger for each share of BioSciences common stock outstanding at the effective time of the merger. Ampio anticipates that it will deliver to holders of its in-the-money stock options and warrants, and holders of two promissory notes, an aggregate of 405,066 shares and 500,000 shares, respectively, out of the 8,667,905 shares of Merger Stock. The remaining 7,762,839 shares of Merger Stock will be issued to the holders of BioSciences common stock pro rata. At the date hereof, BioSciences had 17,975,587 shares of common stock outstanding, of which 9,171,282 shares are Class A common stock and 8,804,305 shares are Class B common stock. After the voluntary cancellation of the 8,804,305 shares of BioSciences Class B common stock by present and former executive officers and directors of BioSciences, the total number of BioSciences shares of common stock outstanding will be 9,171,282 shares at the effective time. Based on the closing price of Ampio common stock of $2.40 on December 31, 2010, the 7,762,839 shares of Merger Stock to be issued to the BioSciences shareholders represented approximately $2.03 in value for each share of the 9,171,282 BioSciences Class A shares of common stock outstanding that will be received by Ampio in the merger.

Based on the closing price of Ampio common stock of $ per share on [—][—], 2011, the latest practicable date prior to the printing of this information statement/prospectus, and after deducting the shares of Merger Stock to be issued to holders of in-the-money BioSciences stock options and warrants and holders of two BioSciences promissory notes from the merger consideration, the merger consideration of Ampio common stock represented approximately $ in value for each share of BioSciences common stock outstanding. The amount of merger consideration to be received by BioSciences shareholders may fluctuate between the date of this information statement/prospectus and the closing of the merger as a result of changes in the market price for Ampio common stock, the total number of shares of BioSciences common stock outstanding at closing, the total number and exercise prices of BioSciences stock options and warrants outstanding at closing and any proceeds received by BioSciences from the exercise of stock options or warrants prior to closing.

BioSciences Options and Warrants

Each vested and exercisable outstanding BioSciences stock option granted under BioSciences’ stock incentive plan or warrant with an exercise price below the effective price of Ampio common stock received by the BioSciences shareholders in the merger will be issued, from the Merger Stock, a number of shares of Merger Stock equal to the amount by which the option or warrant is “in-the-money.” The Merger Stock will be valued for the purposes of making this determination at $1.90 per share, the last reported sale price of the Ampio common stock on September 3, 2010, which was the last trading day immediately prior to the execution of the merger agreement. Based on this value, and as provided in the amended merger agreement, Ampio will issue an aggregate of 405,066 shares out of the Merger Stock to the BioSciences holders of “in-the-money” options and warrants. If an option is “out-of-the-money,” then Ampio will issue replacement Ampio stock option agreements with exercise periods identical to those in the BioSciences stock options, with the exercise price and number of underlying shares adjusted by the exchange ratio. There are 250,850 Biosciences options that are “out-of-the-money” which will be exchanged for 212,693 Ampio options pursuant to this provision of the amended merger agreement. Options formerly held by Bruce G. Miller, Dr. David Bar-Or, Raphael Bar-Or, Dr. James Winkler, and Wannell Crook will be canceled pursuant to the cancellation agreement and will therefore not participate in the Merger Stock issued for “in-the-money” options.

BioSciences Promissory Notes

Fluctuations in Merger Consideration

Because the total consideration to be paid by Ampio in the merger is based on a fixed number of shares of Ampio common stock, the total value a BioSciences stockholder will receive in the merger is subject to change based on fluctuation in the market price for Ampio common stock. By way of illustration, based on the closing price of Ampio common stock of $2.40 on December 31, 2010, the 7,762,839 shares of Merger Stock to be issued to the BioSciences shareholders represented approximately $2.03 in value for each share of the 9,171,282 BioSciences Class A shares of common stock outstanding that will be received by Ampio in the merger. If the market price for Ampio common stock increases to $2.90 on the closing date, the per share merger consideration to be received by each BioSciences stockholder would increase in value to $2.46. Conversely, if the market price of Ampio common stock decreases to $1.90 on the closing date, the per share merger consideration to be received by each BioSciences stockholder would decrease in value to $1.61.

Changes in Number of BioSciences Shares. The aggregate merger consideration to be paid by Ampio in the merger is fixed at 8,667,905 shares of Ampio common stock. Such amounts will be divided among the total number of shares of BioSciences common stock outstanding at the effective time of the merger, after deducting shares of Merger Stock issued in extinguishment of outstanding “in-the-money” options and warrants, as well as extinguishment of two outstanding BioSciences promissory notes. Ampio anticipates that it will deliver to holders of its in-the-money stock options and warrants, and holders of such promissory notes, an aggregate of 905,066 shares of Ampio common stock from the Merger Stock. If BioSciences were to issue more shares of common stock or if holders of BioSciences stock options that are in-the-money were to exercise such options between December 31, 2010 and the closing date, the per share merger consideration would be reduced. For example, if the total number of BioSciences shares increased to 9.3 million by the closing date, the per share amount of merger consideration would be reduced from $2.03 to $2.00. However, the number of shares issued in extinguishment of “in-the-money” options or warrants would be reduced on exercise of outstanding options or warrants, which would have the effect of offsetting some of the reduction in value.

Changes in Outstanding BioSciences Stock Options or Warrants. The merger consideration to be paid by Ampio to BioSciences shareholders in the merger is fixed at 8,667,905 shares of Ampio common stock. These shares will be divided among all shares of BioSciences common stock outstanding at closing and all in-the-money BioSciences stock options and warrants, as well as two BioSciences promissory notes, outstanding immediately prior to closing. All BioSciences stock options and warrants that are in-the-money immediately prior to closing will be entitled to receive the “in-the-money” value in the form of Ampio common stock issued out of the Merger Stock in exchange for such options and warrants. BioSciences has agreed not to issue any additional options or warrants between the date of the amended merger agreement and closing, meaning that the portion of the Merger Stock issuable to BioSciences option holders will not be increased through the issuance of additional option or warrant issuances

Lock-Up Agreements

The amended merger agreement provides that the issuance of certificates representing the Merger Stock will be conditioned upon the receipt by Ampio of lock-up agreements from the BioSciences shareholders pursuant to which such persons agree that they will not sell, transfer or pledge the Merger Stock received by them after the closing of the merger until December 31, 2011. The lock-up agreements will be delivered by the exchange agent, Corporate Stock Transfer, Inc., with the letter of transmittal to the BioSciences shareholders. BioSciences shareholders who previously provided their share certificates to BioSciences will receive the lock-up agreement from the exchange agent under separate cover. Executive and non-executive officers of BioSciences who receive Merger Stock, and executive and non-executive officers and employees of Ampio at the time of the merger, are required by the merger agreement, as amended, to sign lock-up agreements covering the Merger Stock, and any other Ampio shares owned by such persons, for a period through February 28, 2012.

Background of the Merger

The board of directors of BioSciences, together with the company’s senior management and advisors, has periodically reviewed and considered various strategic opportunities available to BioSciences, including whether the continued execution of BioSciences strategy as a stand-alone company or the possible sale of BioSciences to, or a combination of BioSciences with, a third party offered the best avenue to enhance shareholder value. In the last four years, representatives of BioSciences held conversations from time to time with representatives of potential merger partners or purchasers in connection with potential business combination transactions. None of these conversations, negotiations or activities, other than those with Ampio, ultimately resulted in an agreement.

At various times in April and early May 2010, Michael Macaluso, Ampio’s chairman of the board, and Donald B. Wingerter, Jr., Ampio’s chief executive officer, were contacted by several BioSciences shareholders concerning the possibility of Ampio acquiring BioSciences. These contacts followed the March 2010 merger of Ampio into Chay, at which time Ampio became a public company. BioSciences was then, and now is, a private company.

In early April 2010, Messrs. Macaluso and Wingerter contacted Bruce G. Miller, the president of BioSciences and Ampio’s chief operating officer at that time, to discuss the possibility of a potential business combination of BioSciences with Ampio.

Also, in early April 2010, Messrs. Macaluso, Wingerter and Miller discussed the potential business combination with Dr. Bar-Or, who was the largest shareholder of BioSciences Class B common stock and both a member of the board of directors and chief scientific officer of Ampio. In view of the conflicts of interest inherent in Dr. Bar-Or’s positions with Ampio and shareholdings in BioSciences, the board of Ampio established an acquisition committee that was charged with evaluating and negotiating the potential terms under which Ampio would acquire BioSciences.

On April 7, 2010, the board of directors of Ampio appointed Messrs. Michael Macaluso and Donald B. Wingerter, Jr. to the acquisition committee of the board of Ampio. In mid-April 2010, the Ampio acquisition committee held various discussions with the members of a BioSciences board committee and other members of the BioSciences board. Following Philip H. Coelho joining the Ampio board in April 2010, Mr. Coelho was also appointed to the acquisition committee.

Over the course of the following week, BioSciences management and counsel discussed with Ampio and its counsel BioSciences comments on the letter of intent and the terms of a potential transaction.

Following the further discussions between BioSciences, Ampio and their respective counsel, BioSciences and Ampio on April 22, 2010 executed a non-binding letter of intent which memorialized the intent of the parties to undertake a business combination transaction. The terms of the letter of intent contemplated that BioSciences shareholders would receive an aggregate of 8,224,179 shares of Ampio common stock, of 1,500,000 shares would be subject to an earn-out tied to BioSciences successfully obtaining a new collaborator or licensee for Zertane. The letter of intent contemplated that the merger also would be subject to the additional condition that Ampio would obtain additional equity or debt funding before the closing would occur.

In mid-July 2010, Ampio and its counsel submitted a draft agreement and plan of merger to BioSciences and its counsel for review by the BioSciences special committee of the board and its other board members. In late July, Ampio received comments on the definitive agreement draft and updated BioSciences and its counsel on progress in its fundraising efforts.

On August 11, 2010, Mr. Miller resigned from Ampio’s board of directors and Richard B. Giles was appointed to the Ampio Board. Mr. Miller continued to serve as Ampio’s chief financial officer following his resignation as an Ampio board member, and also continued to serve as the president of BioSciences. Mr. Giles was then a shareholder of Ampio and BioSciences.

In late August 2010, Ampio and BioSciences agreed to modify the terms of the proposed acquisition through amendments made to the draft definitive agreement and plan of merger. The amendments included the elimination of the financing condition related to Ampio, elimination of the earn-out provision related to BioSciences, and an increase in the shares issuable to BioSciences shareholders to 8,667,905 shares.

On August 25, 2010, Mr. Macaluso and Mr. Wingerter attended a meeting with the board of directors of BioSciences at which certain additional revisions to the terms of the merger were discussed. Following that meeting, the board of directors of BioSciences unanimously approved proceeding with the merger on the basis of the terms discussed with Messrs. Macaluso and Wingerter.

Over the next two weeks, Ampio and BioSciences, together with their respective management and counsel, commenced a due diligence investigation concerning the respective businesses and operations of the two companies.

On September 4, 2010, BioSciences mailed a notice of special meeting of its shareholders to be held on September 14, 2010 to its shareholders, together with a signed draft of the agreement and plan of merger (which was subject to completion based on each party’s obligation to deliver schedules and exhibits to the definitive agreement that had not yet been completed), an investor questionnaire, a lock-up agreement, and dissenting shareholder notifications.

On September 14, 2010, all of the shareholders of BioSciences who attended the special meeting in person or by proxy voted, with the exception of one shareholder who abstained, in favor of the merger as outlined in the definitive agreement.

In October and early November 2010, BioSciences received from a majority of its shareholders the completed investor questionnaires, at which time Ampio and BioSciences agreed orally that the merger could not be consummated until the Merger Stock was registered, due to the number of non-accredited shareholders of BioSciences and the number of non-responding shareholders.

On November 8, 2010, a majority in interest of the Ampio shareholders executed a shareholder consent approving the definitive agreement with BioSciences.

On November 12, 2010, Ampio filed a registration statement with the SEC to register the Merger Stock.

On November 22, 2010, the SEC notified Ampio that the shares would be required to be registered pursuant to the form of registration statement applicable to business combination transactions. In addition, Ampio determined that BioSciences and Ampio would have to conduct a new shareholder solicitation or vote in connection with the filing of the business combination registration statement.

On December 30, 2010, the parties amended the merger agreement to contractually waive all rights to enforce the definitive agreement based on the prior BioSciences shareholder vote, to memorialize the advisory nature of the prior BioSciences shareholder vote by agreement of the parties, to postpone the closing until following the circulation of this information statement/prospectus and execution of the new BioSciences shareholder consent, and to make other conforming changes to the definitive agreement and the related transaction documents, including the consent agreement.

On January 6, 2011, Ampio filed the registration statement with the SEC that included this information statement/prospectus.

Ampio’s Reasons for the Merger

Ampio’s board of directors has unanimously approved and adopted the merger agreement. In evaluating the merger, Ampio’s board of directors consulted with Ampio’s management, as well as with Ampio’s legal counsel and, in reaching its conclusions, Ampio’s board of directors considered, among other things, the following material factors:

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the merger will provide Ampio with the ability to advance its strategy to grow its product candidate portfolio;

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the complementary nature of the Zertane rights and Ampio’s rights to its own product candidates is expected to result in increased licensing and collaboration opportunities for both companies’ intellectual property;

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the opportunity to eliminate conflicts of interest in the management and ownership of BioSciences and Ampio will align the interests of Ampio and BioSciences and the shareholders of both companies;

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the expectation that the combined company will achieve some cost savings coming from, among other things, consolidating administrative activities.

Ampio’s board of directors considered the above reasons together with various other reasons for approving and adopting the merger agreement. Ampio’s board of directors did not assign relative weights to the above reasons or the other reasons considered by it. Further, individual members of Ampio’s board of directors may have given different weight to different reasons.

BioSciences Reasons for the Merger

The BioSciences board of directors believes that the merger agreement, the merger and the other transactions contemplated thereby are advisable and in the best interests of BioSciences and its shareholders. Accordingly, the BioSciences board of directors has approved the merger agreement, the merger and the other transactions contemplated thereby and unanimously recommended that BioSciences shareholders adopt the merger agreement and approve the merger and the other transactions contemplated thereby.

As described above under “—Background of the Merger,” the BioSciences board of directors, prior to and in reaching its decision at its meeting in August 2010 to approve the merger agreement, the merger and the other transactions contemplated thereby, consulted with BioSciences management and BioSciences financial and legal advisors and considered a variety of factors weighing positively in favor of the merger, including, but not limited to, the following:

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the value to be received by holders of BioSciences common stock in the merger;

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the fact that the merger affords BioSciences shareholders the opportunity to participate in the growth and opportunities of the combined company by virtue of the Merger Stock to be received as a result of the merger;

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the opportunity, because the merger consideration is a fixed number of shares of Ampio common stock, for BioSciences shareholders to benefit from any increase in the trading price of Ampio common stock between the announcement of the amended merger agreement and the completion of the merger;

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the BioSciences board of directors’ analysis of other strategic alternatives for BioSciences, including continued growth as an independent private company or a sale to another company;

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the strategic benefits of the transaction, including the complementary nature of the intellectual property and potential licensees and collaborators targeted by both Ampio and BioSciences;

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the possible access to a public market that may become available to the BioSciences shareholders following the merger with Ampio, a public company;

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the advantages that the combined entity will have over BioSciences as a standalone company, especially in the current economic environment;

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the fact that the receipt of the merger consideration will not be taxable to BioSciences shareholders for U.S. federal income tax purposes;

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the belief that the terms of the merger agreement and the other transaction documents, taken as a whole, provide a significant degree of certainty that the merger will be completed, including the facts that (i) the conditions required to be satisfied prior to completion of the merger, such as the receipt of BioSciences shareholder consent is expected to be fulfilled, (ii) the merger agreement does not include a financing condition to Ampio’s obligation to consummate the merger, and (iii) there are limited circumstances in which Ampio may terminate the merger agreement;

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the belief that the terms of the merger agreement, including the parties’ representations, warranties and covenants and the conditions to their respective obligations, are reasonable; and

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the financial presentation of Bluestone IBG and its written opinion to the BioSciences board of directors, dated September 7, 2010, to the effect that, as of that date and based on and subject to various assumptions, matters considered and limitations described in its opinion, the merger consideration was fair, from a financial point of view, to the holders of BioSciences common stock. The full text of the written opinion of Bluestone IBG, which sets forth the assumptions made, matters considered and limits on the review undertaken by Bluestone IBG, in rendering its opinion, is attached as Annex B to this information statement/prospectus. A summary of the presentation and opinion of Bluestone IBG appears in the section below entitled “—Opinion of the Financial Advisor to BioSciences.”

In addition to these factors, the BioSciences board of directors also considered the potential adverse impacts of other factors weighing negatively against the merger, including, without limitation, the following:

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the risk that, because the merger consideration is a fixed number of shares of Ampio common stock, BioSciences shareholders could be adversely affected by a decrease in the trading price of Ampio common stock after the date of execution of the amended merger agreement, and the fact that the merger agreement does not provide BioSciences with a price-based termination right or other similar protection, such as a “collar” with respect to Ampio’s stock price, for BioSciences or its shareholders;

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the indemnification obligations of certain BioSciences shareholders and the related escrow arrangements pursuant to the merger agreement, as a result of which BioSciences shareholders will receive 15% of the Merger Stock after a significant delay, if at all;

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the fact that the merger might not be completed in a timely manner or at all, due to a failure of certain conditions;

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the risks and costs to BioSciences if the merger does not close, including the diversion of management and employee attention, potential impediments to BioSciences executing an alternative business plan, and the lack of management employees to execute such a plan;

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the fact that some of BioSciences directors and executive officers may have interests in the merger that are different from, or in addition to, those of BioSciences shareholders generally, including those interests that are a result of employment and compensation arrangements with BioSciences executive officers and the manner in which they would be affected by the merger, as described more fully in the section entitled “—Interests of Certain Persons in the Merger” beginning on page ;

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the restrictions on BioSciences ability to solicit or participate in discussions or negotiations regarding alternative business combination transactions, subject to specified exceptions, which the BioSciences board of directors understood, although having the potential effect of discouraging third parties from proposing a competing business combination transaction, were conditions to Ampio’s willingness to enter into the merger agreement and were reasonable in light of, among other things, the benefits of the merger to BioSciences shareholders;

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the inability of BioSciences to terminate the merger agreement even if the BioSciences board of directors changes its recommendation, which the BioSciences board of directors understood, although having the potential effect (in combination with the consent agreement) of preventing BioSciences shareholders from accepting a competing business combination transaction, was a condition to Ampio’s willingness to enter into the merger agreement and was reasonable in light of, among other things, the benefits of the merger to BioSciences shareholders;

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the restrictions on the conduct of BioSciences business prior to the completion of the merger, which may delay or prevent BioSciences from undertaking business opportunities that may arise during the term of the merger agreement, whether or not the merger is completed;

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the risks that the financial results and the stock price of the combined company might decline, including the possible adverse effects on the stock price and financial results of the combined company if the benefits expected are not obtained on a timely basis or at all; and

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the risks described in the section entitled “Risk Factors” beginning on page .

The foregoing discussion of the factors considered by the BioSciences board of directors is not intended to be exhaustive, but, rather, includes the material factors considered by the BioSciences board of directors. In reaching its decision to declare the merger agreement advisable and that the merger is in the best interests of BioSciences and BioSciences shareholders, and, in approving the merger agreement, the merger and the other transactions contemplated by the merger agreement, the BioSciences board of directors did not quantify or assign any relative weights to the factors considered, and individual directors may have given different weights to different factors. The BioSciences board of directors considered all these factors as a whole, including discussions with, and questioning of, BioSciences management and BioSciences financial and legal advisors, and overall considered the factors to be favorable to, and to support, its decision.

For the reasons set forth above, the BioSciences board of directors unanimously declared the merger agreement advisable and determined that the merger is in the best interests of BioSciences and its shareholders, unanimously approved the amended merger agreement, the merger and the other transactions contemplated by the amended merger agreement and unanimously recommended that BioSciences shareholders adopt the amended merger agreement and approve the merger and the other transactions contemplated thereby.

This explanation of BioSciences reasons for the merger and other information presented in this section is forward-looking in nature and, therefore, should be read in light of the factors described under “Cautionary Statement Regarding Forward-Looking Statements” on page 31.

Opinion of the Financial Advisor to BioSciences

BioSciences retained Bluestone IBG as its financial advisor to advise the board of directors of BioSciences in connection with the merger. At the August 24, 2010 meeting of the board of directors of BioSciences, Bluestone IBG delivered to the board of directors of BioSciences its oral opinion, which opinion was confirmed by delivery of a written opinion dated as of September 7, 2010, to the effect that, as of that date and based on and subject to various assumptions, matters considered and limitations described in its opinion, the merger consideration was fair, from a financial point of view, to the holders of BioSciences common stock.

The full text of the written opinion of Bluestone IBG, dated September 7, 2010, which sets forth the assumptions made, matters considered and limits on the review undertaken by Bluestone IBG in rendering its opinion, is attached as Annex B to this information statement/prospectus. Bluestone IBG expressed no opinion as to the merits of the underlying decision by BioSciences to engage in the merger or the relative merits of the merger as compared to any alternative business strategies, nor did it express an opinion or recommendation as to how any holder of BioSciences common stock should vote with respect to the merger or as to whether any holder of BioSciences common stock should deliver a consent with respect to the adoption of the merger agreement and the approval of the merger. The summary of the Bluestone IBG opinion set forth in this information statement/prospectus is qualified in its entirety by reference to the full text of the opinion attached hereto as Annex B.

In connection with Bluestone IBG’s role as financial advisor to BioSciences, and in arriving at its opinion, Bluestone IBG, among other things:

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reviewed certain publicly available financial and other information concerning BioSciences and Ampio;

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reviewed certain internal analyses, financial forecasts and other information relating to BioSciences prepared by management of BioSciences, and held discussions with members of BioSciences management regarding the businesses and prospects of BioSciences;

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reviewed the reported prices and trading activity for the Ampio common stock;

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to the extent publicly available, compared certain financial and stock market information for BioSciences and Ampio with similar information for certain other companies it considered relevant whose securities are publicly traded;

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reviewed the merger agreement and the consent agreement; and

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performed other studies and analyses and considered any other factors as it deemed appropriate.

Bluestone IBG did not assume responsibility for the independent verification of, and did not independently verify, any information, whether publicly available or furnished to it, concerning BioSciences or Ampio, including, without limitation, any financial information considered in connection with the rendering of its opinion. Accordingly, for purposes of its opinion, Bluestone IBG, with the permission of the board of directors of BioSciences, assumed and relied upon the accuracy and completeness of all such information. Bluestone IBG did not conduct a physical inspection of any of the assets of BioSciences, and did not prepare or obtain any independent evaluation or appraisal of any of the assets or liabilities (including any intellectual property), of BioSciences or Ampio or any of their respective subsidiaries, nor did Bluestone IBG evaluate the solvency or fair value of BioSciences or Ampio under any state or federal law relating to bankruptcy, insolvency or similar matters.

The Bluestone IBG opinion was necessarily based upon economic, market and other conditions, and the information made available to Bluestone IBG, as of the date of the opinion. Bluestone IBG expressly disclaimed any undertaking or obligation to advise any person of any change in any fact or matter affecting its opinion of which it becomes aware after the date of the opinion.

For purposes of rendering its opinion, Bluestone IBG assumed with the permission of the board of directors of BioSciences that, in all respects material to its analysis, the merger would be consummated in accordance with its terms, without any material waiver, modification or amendment of any term, condition or agreement. Bluestone IBG also assumed that all material governmental, regulatory, contractual or other approvals and consents required in connection with the consummation of the merger will be obtained and that in connection with obtaining any necessary governmental, regulatory, contractual or other approvals and consents, no material restrictions, terms or conditions will be imposed. Bluestone IBG is not a legal, regulatory, tax or accounting expert and has relied on the assessments made by BioSciences and its advisors with respect to such issues.

The Bluestone IBG opinion was approved and authorized for issuance by Bluestone IBG management and was addressed to, and for the use and benefit of, the BioSciences board of directors. The Bluestone IBG opinion was limited to the fairness, from a financial point of view, of the merger consideration to the holders of BioSciences common stock. Bluestone IBG was not asked to, and the Bluestone IBG opinion did not, address the fairness of the merger, or any consideration received in connection therewith, to the holders of any other class of securities, creditors or other constituencies of BioSciences, nor did it address the fairness of the contemplated benefits of the merger.

Bluestone IBG expressed no opinion as to the merits of the underlying decision by BioSciences to engage in the merger or the relative merits of the merger as compared to any alternative business strategies, nor did it express an opinion or recommendation as to how any holder of BioSciences common stock should vote with respect to the merger or as to whether any holder of BioSciences common stock should deliver a consent with respect to the adoption of the merger agreement and the approval of the merger. Bluestone IBG did not express any view or opinion as to the fairness, financial or otherwise, of the amount or nature of any compensation payable to or to be received by any of BioSciences officers, directors or employees, or any class of such persons, in connection with the merger whether relative to the amounts to be received by any other person pursuant to the merger agreement or otherwise. Bluestone IBG assumed, with the consent of the BioSciences board of directors, that no agreements or arrangements with the holders of any class of securities, creditors or other constituencies of BioSciences, other than the agreements and arrangements contemplated in the merger agreement, were being entered into, amended or terminated as part of the merger. The Bluestone IBG opinion did not in any manner address the prices at which Ampio’s stock will trade following the announcement or consummation of the merger.

The following is a summary of the material financial analyses contained in the presentation that was made by Bluestone IBG to the board of directors of BioSciences on August 24, 2010 and that were used by Bluestone IBG in connection with rendering its written opinion described above. The following summary, however, does not purport to be a complete description of the financial analyses performed by Bluestone IBG, nor does the order of analyses described represent the relative importance or weight given to those analyses by Bluestone IBG. Some of the summaries of the financial analyses include information presented in tabular format. The tables must be read together with the full text of each summary and are alone not a complete description of Bluestone IBG’s financial analyses. Except as otherwise noted, the following quantitative information, to the extent that it is based on market data, is based on market data as it existed on or before August 24, 2010, and is not necessarily indicative of current market conditions.

Transaction Overview

Based on 9,171,282 outstanding shares of Biosciences common stock and the conversion ratio as stipulated in the Merger Agreement, as amended, of .84643 shares of Ampio common stock for each share of Biosciences common stock (which equates to 7,762,839 shares of Ampio common stock), Bluestone IBG noted the implied range of value of approximately $13.0 million and $15.5 million. This is based on the range of stock prices at September 7^th and the ten days prior to that date. The range of Total Enterprise Value of Biosciences as of September 7, 2010 is between $3.75 million and $4.5 million. The TEV of BioSciences is expected to increase following the updating of Bluestone IBG’s fairness opinion, which will be filed as an exhibit to the registration statement that includes this information statement/prospectus.

BioSciences Analysis

Comparable Transaction Analysis

After Bluestone IBG conducted industry and economic research and analysis of BioSciences’ history, a market-based approach to valuation was examined. This fairness opinion and valuation considered but did not use the publicly traded approach. A search was undertaken for freely and actively traded public companies in the same or similar businesses. The only true comparable is the drug therapy Dapoxetine, which is marketed by Johnson and Johnson. It was originally created by Eli Lilly and Company and sold to Johnson and Johnson in 2003. There is approval to sell this therapy in six European countries, with approvals expected in more countries. This drug therapy is owned by Johnson and Johnson, which is a large pharmaceutical and medical device company. Thus, there is no segmented financial data for such a small part of their business. This is the only true comparable that exists. Using other drug discovery companies that are in clinical trials is not comparable in terms of value, as it is not possible to discern where companies are in the development process, and whether their drug therapy is similar to BioSciences’ therapy or not. Additionally, companies in this phase of development generally have negative price to earnings ratios, thus valuation comparisons lack positive correlation. Additionally, to correlate price to revenue would be equally difficult as some companies in this phase of development have small amounts of revenue and others have no revenue at all. Another important distinguishing factor that makes it difficult to find comparable companies is that Biosciences is seeking to license the therapy and to collect royalty revenues, rather than taking the drug to market itself. Therefore, even if there was in fact a correlation of some trends as it relates to price to earnings or price to revenue ratios, the comparison to Biosciences would also be difficult, as BioSciences has a history of losses, and although the current nine month period shows positive earnings, that is an anomaly.

Income Approach - Discounted Cash Flow/benefit Analysis

Bluestone utilized a Discounted projected future cash flows method which involves projecting the possible future income streams on a year-by-year basis through 2020. The projected future benefit streams were discounted each year back to present value using an appropriate, risk adjusted discount rate. At the final projection year a “terminal value” is determined, which is the value of the entity into perpetuity. The terminal value is also then discounted back to present value at the same prevailing discount rate. These figures combine to form a value of Biosciences based on future projected income streams. In this approach, Bluestone IBG used a discount rate that is commensurate with the risk involved in taking a development stage drug therapy through clinical trials, into commercialization and sold as a successful product. Bluestone IBG utilized both company management expertise as well as an industry seasoned investment banking and venture firm to project out the viability and success of going to market. Bluestone then utilized those projection models with management input and created a projection model that comports with Biosciences business model – namely by creating a licensing arrangement with an organization that is equipped to take the drug therapy though the rest of development, clinical trials and to commercialization. Biosciences will then receive a royalty stream for that. Thus, Bluestone discounted that royalty stream and its associated costs and expenses back to present value in a similar vein to that of the industry seasoned investment bank and projected out the commercial viability of the entire process of development and success of selling the product.

It is important to note that Internal Revenue Service Revenue Ruling 59-60 states that earnings are preeminent for the valuation of operating companies. In order to apply a discounted future earnings method, two underlying assumptions needed to be satisfied. First, the operating Biosciences future results would be expected to be different from current operations. Second is to determine a long-term sustainable growth rate used to convert the discount rate to a capitalization rate to assist in calculating the terminal value. The long-term sustainable growth rate is seen as a blend of rates of growth over the future periods beyond the period that prospective financial statements were prepared.

Bluestone used the Capital Asset Pricing Model (“CAPM”) to determine the discount rate or the cost of capital. The discount rate can be viewed in terms of what type of rate of return an investor is seeking commensurate with the risk tolerance or risk parameters of a given investment or a given class of investments of similar risk. The CAPM addresses this form of risk and return. Bluestone has added into that model an additional component for the nature and risk tolerance of this type of development stage drug therapy company that is many years away from being revenue producing. The CAPM model consists of four rates of returns or risk premiums, to which Bluestone added a component called Development Risk. Bluestone discounted cash flow back to present value using a two tiered discount rate. For the first four years of the projection, in which the drug therapy is still in clinical trials and pre-potential revenue, Bluestone used a discount rate range of between 70% and 80%. In the next six years and the terminal year, Bluestone used a discount rate range of 40% to 45%. This lower discount rate reflects that the drug therapy will commence commercialization. This approach gives rise to a range of value from $3.75 million to 4.5 million.

Ampio Analysis

Historical Stock Price Performance. Bluestone IBG reviewed the historical trading prices for the Ampio common stock for the period from March 30, 2010 through September 8, 2010. Bluestone IBG also calculated the average closing price for the Ampio common stock for the time periods indicated in the table below, in each case compared to the closing price of Ampio common stock of $2.70 on September 8, 2010:


Time Period Ended September 8, 2010	Average Closing Price
10-day average	$	2.01
20-day average	$	1.82
30-day average	$	1.58
60-day average	$	1.40
1-year average	$	1.94

General

The preparation of a fairness opinion is a complex process and is not necessarily susceptible to partial analysis or summary description. Selecting portions of the analyses or of the summary set forth above, without considering the analyses as a whole, could create an incomplete view of the processes underlying the Bluestone IBG opinion. In arriving at its fairness determination, Bluestone IBG considered the results of all of its analyses and did not attribute any particular weight to any factor or analysis considered by it. Rather, Bluestone IBG made its determination as to fairness on the basis of its experience and professional judgment after considering the results of all of its analyses. No company is directly comparable to BioSciences or Ampio for purposes of Bluestone IBG’s analyses.

Bluestone IBG prepared these analyses for purposes of providing its opinion to the board of directors of BioSciences as to the fairness, from a financial point of view, of the merger consideration to the holders of BioSciences common stock. These analyses do not purport to be appraisals nor do they necessarily reflect the prices at which businesses or securities actually may be sold. Analyses based upon forecasts of future results are not necessarily indicative of actual future results, which may be significantly more or less favorable than suggested by these analyses.

The merger consideration to be received in the merger was determined through arm’s-length negotiations between BioSciences and Ampio management and board members that were unaffiliated with the opposite party, and was approved by the board of directors of BioSciences. Bluestone IBG provided advice to BioSciences during these negotiations. Bluestone IBG did not, however, recommend the merger consideration to BioSciences or its board of directors or that any specific consideration constituted the only appropriate consideration for the merger.

As described above, the opinion from Bluestone IBG to the board of directors of BioSciences was one of a number of factors taken into consideration by the board of directors of BioSciences in making its determination to approve the merger agreement and the merger. Bluestone IBG’s opinion should not be viewed as determinative of the views of the board of directors of BioSciences or management of BioSciences with respect to the merger or merger consideration. The foregoing summary does not purport to be a complete description of the analyses performed by Bluestone IBG in connection with its opinion and is qualified in its entirety by reference to its written opinion attached to this information statement/prospectus as Annex B.

BioSciences selected Bluestone IBG as financial advisor in connection with the merger based on Bluestone IBG’s qualifications, expertise, reputation and experience in small capitalization mergers and acquisitions. Pursuant to its engagement letter with BioSciences, Bluestone IBG was paid a fee for its services as financial advisor to BioSciences in connection with the merger in the amount of approximately $37,500. BioSciences also agreed to reimburse Bluestone IBG for its expenses, and to indemnify Bluestone IBG against certain liabilities, in connection with its engagement.

Bluestone IBG is an investment banking firm experienced in providing advice in connection with small capitalization mergers and acquisitions and related transactions. During the two years preceding the date of the opinion, Bluestone IBG has not provided any investment banking or other advisory services to Ampio, BioSciences or their respective affiliates.

Accounting Treatment of the Merger

The merger will be accounted for by applying the acquisition method with BioSciences considered the acquiree and Ampio the acquirer for accounting and financial reporting purposes. BioSciences assets, liabilities and other items will be adjusted to their estimated fair value on the closing date of the merger and combined with the historical book values of the assets and liabilities of Ampio. Applicable income tax effects of these adjustments will be included as a component of the combined company’s deferred tax asset or liability. The difference between the estimated fair value of the assets, liabilities and other items (adjusted as discussed above) and the purchase price will be recorded as goodwill. Financial statements of Ampio issued after the merger will reflect the values and will not be restated retroactively to reflect the historical financial position or results of operations of BioSciences.

Regulatory Approvals Required for the Merger

Except with respect to the SEC’s review of the registration statement that incorporates this information statement/prospectus, BioSciences and Ampio are not aware of any regulatory approvals that must be obtained with respect to the merger. BioSciences and Ampio have agreed to use their reasonable best efforts to obtain all consents and approvals of any governmental entity or third party required in connection with the merger.

Interests of Certain Persons in the Merger

Members of the board of directors and executive officers of BioSciences may have interests in the merger that are different from, or are in addition to, the interests of BioSciences shareholders generally. The BioSciences board of directors was aware of these interests and considered them, among other matters, in approving the merger agreement and in determining to recommend to BioSciences shareholders to adopt the merger agreement and approve the merger and the other transactions contemplated thereby.

Executive Officer Employment Arrangements

Each of Dr. Bar-Or and Bruce G. Miller is a party to an agreement with BioSciences that provides for payment of severance benefits upon certain terminations of employment following a change in control. As both Dr. Bar-Or and Mr. Miller will continue to serve as executive officers of Ampio after the merger, Ampio and BioSciences have obtained written acknowledgments and agreements from Dr. Bar-Or and Mr. Miller that the merger will not trigger any rights to severance benefits under the pre-existing BioSciences employment agreements.

BENEFICIAL OWNERSHIP OF BIOSCIENCES COMMON STOCK

The following table sets forth information with respect to the beneficial ownership of BioSciences common stock as of December 31, 2010 for:

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each stockholder known by BioSciences to beneficially own more than 5% of BioSciences common stock;

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each of BioSciences directors and executive officers; and

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all of BioSciences directors and executive officers as a group.

The percentage of ownership indicated in the following table is based on 17,975,587 shares of BioSciences Class A and Class B common stock outstanding as of December 31, 2010. Beneficial ownership is determined in accordance with the rules of the SEC. These rules generally attribute beneficial ownership of securities to persons who possess sole or shared voting power or investment power with respect to those securities and include shares of common stock issuable upon the exercise of stock options and warrants that are currently exercisable or exercisable within 60 days. Except as otherwise indicated, all persons listed below have sole voting and investment power with respect to the shares beneficially owned by them. The information is not necessarily indicative of beneficial ownership for any other purpose.


Name	Total BioSciences Common Stock Shares Owned (1)		Percent of Total Common Stock
5% Shareholders
David Bar-Or		3,291,979		18.3	%
Genesis Capital Management and affiliates (2)		1,883,256		10.5	%
Raphael Bar-Or		950,048		5.3	%

Directors and Executive Officers:
Bruce G. Miller		1,995,020		11.1	%
James V. Winkler		1,360,641		7.6	%
Wannell M. Crook		1,155,017		6.4	%
Edward Lau		699,183		3.9	%
Daniel Navot (3)		550,000		3.1	%
James S. Kimmel		244,722		1.4	%

All Directors and Executive Officers as a Group (6 persons)		5,209,861		29.0	%

(1)	Consists of direct and indirect ownership of shares, including stock options that are currently exercisable or exercisable within 60 days.

(2)	Represents BioSciences shares of common stock held by Genesis Capital Management, Biotechnology Fund and Genesis Investment Funds Limited, which are shareholders of BioSciences. The address of all such entities is Trust House, 112 Bonadie Street, Kingtown, Saint Vincent & The Grenadines.

(3)	Dr. Navot resigned from the board of directors of BioSciences following the September 14, 2010 meeting of shareholders of BioSciences. Excludes 100,000 BioSciences warrants held by Dr. Navot’s family members that will be exchanged for a portion of the Merger Stock.

THE MERGER AGREEMENT

The following is a summary of selected material provisions of the merger agreement. This summary is qualified in its entirety by reference to the merger agreement, which is attached to this information statement/prospectus as Annex A. The rights and obligations of the parties are governed by the express terms and conditions of the merger agreement and not by this summary or any other information contained in this document. BioSciences shareholders are urged to carefully read the merger agreement in its entirety as well as this document.

In reviewing the merger agreement, please remember that it is included to provide you with information regarding its terms and is not intended to provide any other factual information about Ampio or BioSciences. The merger agreement contains representations and warranties by each of the parties to the merger agreement. These representations and warranties have been made solely for the benefit of the other parties to the merger agreement and (i) may be intended not as statements of fact, but rather as a way of allocating the risk to one of the parties if those statements prove to be inaccurate, (ii) have been qualified by certain disclosures that were made to the other party in connection with the negotiation of the merger agreement, which disclosures are not reflected in the merger agreement, and (iii) may apply standards of materiality in a way that is different from what may be viewed as material by you or other investors.

Accordingly, the representations and warranties and other provisions of the merger agreement should not be read alone, but instead should be read together with the information provided elsewhere in this document and in the documents incorporated by reference into this document. See “Where You Can Find More Information” on page 93.

Form of the Merger

If the holders of BioSciences common stock approve and adopt the merger agreement and all other conditions to the merger are satisfied or waived, Merger Sub, a newly formed and wholly-owned subsidiary of Ampio, will be merged with and into BioSciences. BioSciences will survive the merger as a direct, wholly-owned subsidiary of Ampio. Ampio and BioSciences anticipate that the closing of the merger will occur no later than the second business day after the satisfaction or waiver of all conditions described below under the heading “The Merger Agreement—Conditions to the Merger,” including the adoption of the merger agreement and approval of the merger and the other transactions by the BioSciences shareholders by written consent after receipt of this information statement/prospectus.

Merger Consideration

The aggregate consideration that will be paid by Ampio to BioSciences shareholders in the merger is 8,667,905 shares of Ampio common stock. This consideration includes the consideration payable to holders of in-the-money BioSciences stock options and warrants, as well as two promissory notes, outstanding immediately prior to the effective time of the merger.

At the effective time of the merger, each share of BioSciences common stock will entitle the holder thereof to receive the merger consideration, which will consist of the Ampio common stock. The merger consideration refers to the number of shares of Ampio common stock payable in the merger for each share of BioSciences common stock outstanding at the effective time of the merger, after deducting from the Merger Stock the shares of Ampio common stock issuable to holders of “in-the-money” stock options and warrants, and to holders of two BioSciences promissory notes. Assuming that BioSciences does not issue any shares of common stock following the execution of the merger agreement, that no holders of BioSciences stock options or warrants that are in-the-money exercise their options or warrants, and 905,066 shares are issued from the Merger Stock in extinguishment of “in-the-money” stock options and warrants, as well as two promissory notes, each share of BioSciences common stock will entitle the holder thereof to receive .84643 shares of Ampio common stock in the merger. Based on the last quoted price of Ampio common stock on the OTC Bulletin Board on December 31, 2010, this amount is the equivalent of $2.03 per share of BioSciences common stock.

BioSciences Options and Warrants

Each vested and exercisable outstanding BioSciences stock option granted under BioSciences’ stock incentive plan and each warrant will receive a number of shares of Merger Stock equal to the amount by which the option or

warrant is “in-the-money.” The Merger Stock will be valued for the purposes of making this determination at $1.90 per share, the last reported sale price of the Ampio common stock on September 3, 2010, which was the last trading day immediately prior to the execution of the merger agreement. Based on this value, and as provided in the amended merger agreement, Ampio will issue an aggregate of 405,066 shares out of the Merger Stock to the BioSciences holders of “in-the-money” options and warrants. If an option is “out-of-the-money,” then Ampio will issue replacement Ampio stock option agreements with exercise periods identical to those in the BioSciences stock options, with the exercise price and number of underlying shares adjusted by the exchange ratio. At the date hereof, 250,850 Biosciences options that are “out-of-the-money” which will be exchanged for 212,693 Ampio options. The exercise periods of these options and warrants will expire at various dates through January 2014 and have a weighted average exercise price of $1.38.

Options formerly held by Bruce G. Miller, Dr. David Bar-Or, Raphael Bar-Or, Dr. James Winkler, and Wannell Crook will be canceled pursuant to the cancellation agreement and will therefore not participate in the Merger Stock issued for “in-the-money” options.

The Donation to Capital Agreement and the Cancellation Agreement

As described in the merger agreement, BioSciences and its affiliates, on the one hand, and Ampio, on the other hand, entered into the donation to capital agreement that takes effect immediately prior to the effective time. Under the donation to capital agreement, BioSciences agreed to donate to the capital of Ampio an aggregate of 3.500,000 shares of Ampio common stock currently owned by BioSciences, and the current and former officers and directors of BioSciences agreed to donate to the capital of BioSciences an aggregate of 8,804,305 shares of BioSciences Class B common stock owned by them. The effect of the donation to capital by the current and former officers and directors of BioSciences will be to retire all outstanding BioSciences Class B shares of common stock, with the result that the BioSciences Class A shareholders will own 100% of BioSciences at the effective time. Therefore, the current and former officers and directors of BioSciences will not receive Merger Stock as a result of their ownership of Class B common stock of BioSciences.

BioSciences Promissory Notes, the Conversion Agreement and the Tag-Along Agreement

Conversion of Shares; Procedures for Exchange of Certificates; Fractional Shares

At the effective time of the merger, each outstanding share of BioSciences common stock (other than shares held by Ampio or Merger Sub) will automatically convert into the right to receive the merger consideration. At or prior to the effective time of the merger, Ampio will cause the merger consideration to be provided to its transfer agent, Corporate Stock Transfer, Inc., which will also act as exchange agent for the merger.

The merger agreement provides that as promptly as practicable after the effective time of the merger, the exchange agent will mail a letter of transmittal to each holder of record of shares of the common stock of BioSciences. The letter of transmittal will contain instructions on how to surrender shares of BioSciences common stock in exchange for the merger consideration the holder is entitled to receive under the merger agreement. If BioSciences shareholders previously delivered their certificates to BioSciences, then BioSciences will deliver such certificates to the exchange agent immediately following the closing of the merger, and those shareholders will not be required to execute a letter of transmittal. Such shareholders will, however, be required to submit a signed lock-up agreement in order to obtain certificates representing Ampio common stock issued as the merger consideration.

Shareholders of BioSciences that have possession of their certificates should, after receiving the letter of transmittal, should surrender the certificates to the exchange agent and will thereafter receive the merger consideration and cash in lieu of fractional shares in an amount equal to the fair market value of the holder’s fractional interest, if any.

After the effective time of the merger, each certificate that previously represented shares of BioSciences common stock (other than certificates held by Ampio, Merger Sub or any other subsidiary of Ampio) will represent only the right to receive the merger consideration. Ampio will not issue any fractional shares of Ampio common stock to any BioSciences stockholder upon surrender of its certificates. Each holder of BioSciences common stock who would have otherwise been entitled to receive a fraction of a share of Ampio common stock will receive cash in lieu of a fractional share of Ampio common stock. The amount of cash will be equal to the fair market value of the fractional share, which fair market value shall be determined by multiplying the relevant share fraction by the per share value of the merger consideration (based on a per share value of $2.30 for Ampio common stock, which was calculated as the average of recent prices for Ampio common stock as reported by the OTC Bulletin Board during December 2010). No interest will be paid or will accrue on the cash payable upon surrender of those certificates.

If any certificate of Ampio common stock is to be issued in a name other than that in which the BioSciences certificate to be exchanged is registered, exchange and payment may be made if the certificate representing those shares of BioSciences common stock is properly endorsed or otherwise in proper form for transfer, and the transferee requesting such exchange pays to the exchange agent any transfer taxes or other taxes required.

Shares of BioSciences common stock owned by Ampio or any wholly-owned Ampio subsidiary, including Merger Sub, will be cancelled at the effective time of the merger without payment of any merger consideration.

Effective Time of the Merger

The merger will become effective at the time the articles of merger and the certificate of merger relating to the merger are filed with the Secretary of State of the State of Colorado or such later time as is agreed upon by the parties and specified in the articles of merger and the certificate of merger. The filing of the articles of merger and the certificate of merger will take place only after the fulfillment or waiver of the conditions described below under the heading “Merger Agreement—Conditions to the Merger.”

Management and Organizational Documents after the Merger

Management. The directors and the officers of Merger Sub immediately prior to the merger will become the initial directors and officers of the surviving corporation immediately following the merger. Each such individual will hold office in accordance with the by-laws of the surviving corporation.

Organizational Documents. The certificate of incorporation of the surviving corporation shall be amended and restated at the effective time of the merger to conform to the certificate of incorporation of Merger Sub, and such certificate of incorporation shall be the certificate of incorporation of the surviving corporation. The by-laws of the surviving corporation shall be amended and restated at the effective time to conform to the by-laws of Merger Sub, and such by-laws will be the by-laws of the surviving corporation.

Consent Agreement

As a condition to Ampio and Merger Sub entering into the merger agreement, the BioSciences Major Shareholders, which represent 73.5% of BioSciences outstanding common stock, entered into an agreement with Ampio pursuant to which the BioSciences Major Shareholders agreed, among other things, to execute and deliver a written consent adopting the merger agreement and approving the merger and the other transactions contemplated thereby once the registration statement with respect to which the shares of Ampio common stock to be issued in the merger is declared effective by the SEC and the BioSciences Major Shareholders have received this information statement/prospectus.

Indemnification

items (“Adverse Consequences”). Indemnification claims will be subject to a per-claim minimum threshold of $25,000 (aggregating all reasonably related claims). Any indemnification claims resulting from intentional misrepresentations or omissions of material fact in BioSciences representations and warranties are not subject to the $25,000 minimum. The Indemnifying Shareholders will not be obligated to indemnify Ampio from any incidental, consequential, special, punitive or other indirect damages. The indemnification obligations of the BioSciences shareholders are capped at the 250,000 Ampio shares held in the escrow fund which is described below, except for indemnification for intentional misrepresentations or omissions of material fact, which are subject to an additional indemnification by the BioSciences control shareholders.

Escrow Fund

Shareholders’ Representative

By adopting the merger agreement, the Indemnifying Shareholders are appointing James S. Kimmel to serve as the Shareholders’ Representative under the merger agreement and escrow agreement. The powers and duties of the Shareholders’ Representative include:

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executing certain amendments to the merger agreement;

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executing and delivering waivers and consents related to the merger agreement and the escrow agreement;

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using his reasonable efforts to ensure and protect the rights and interests of the Indemnifying Shareholders and to enforce and protect its own rights and interests arising out of or relating to the merger agreement or the escrow agreement;

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causing releases of the shares of common stock in the escrow fund pursuant to the escrow agreement;

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enforcing distribution of the escrowed shares;

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negotiating and settling disputes and controversies with Ampio and Merger Sub; and

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communicating with Ampio, Merger Sub, the surviving corporation and any other affiliate of Ampio in connection with indemnification claims under the merger agreement and escrow agreement.

Representations and Warranties

The merger agreement contains a number of representations and warranties made by the parties to each other, including those regarding:

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due organization, good standing and qualification;

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capital structure;

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authority to enter into the merger agreement and to consummate the transactions thereunder;

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no conflicts with or violations of governance documents, contracts or laws;

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conduct of business in the ordinary course since December 30, 2010, and no events having occurred which would have a material adverse effect;

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no litigation or investigations;

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accuracy of information supplied in connection with this information statement/prospectus and the registration statement of which it is a part;

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tax matters;

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compliance with applicable laws;

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brokers and finders; and

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no additional representations or warranties.

In addition, BioSciences made representations and warranties to Ampio as to:

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accuracy of financial statements;

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no undisclosed liabilities;

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employment matters;

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intellectual property;

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assets;

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material contracts;

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affiliate transactions;

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possession of required licenses and regulatory approvals;

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corporate records;

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the receipt of an opinion from its financial advisor; and

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the absence of litigation.

Ampio also represented and warranted to BioSciences as to:

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Ampio equity interests;

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reports and regulatory matters;

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tax matters;

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consent of Ampio shareholders to the merger; and

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current dividend practice.

In addition, the merger agreement contains representations and warranties made by Merger Sub to BioSciences regarding certain of the matters listed above.

Certain of BioSciences and Ampio’s representations and warranties are qualified as to materiality or “material adverse effect.” When used with respect to BioSciences or Ampio, “material adverse effect” means any change, effect, event or occurrence or state of facts that either individually or in the aggregate is materially adverse to the business, assets, operations, properties, condition (financial or otherwise) or results of operations of BioSciences and its subsidiaries or Ampio and its subsidiaries, respectively, taken as a whole.

Changes, effects, events or occurrences or a particular state of facts will not be deemed a “material adverse effect” with respect to BioSciences or Ampio, as the case may be, if such changes, effects, events or occurrences or state of facts relate to:

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economic, financial market, regulatory, political or geographical conditions in general, including changes resulting from acts of war or terrorism or other outbreaks or escalations of hostilities that do not have a materially disproportionate adverse effect on BioSciences and its subsidiaries or Ampio and its subsidiaries, respectively, taken as a whole;

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acts of war or terrorism or other outbreaks or escalations of hostilities that do not have a materially disproportionate adverse effect on BioSciences and its subsidiaries or Ampio and its subsidiaries, respectively, taken as a whole;

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changes in law or applicable accounting regulations or principles or interpretations thereof that do not have a materially disproportionate adverse effect on BioSciences and its subsidiaries or Ampio and its subsidiaries, respectively, taken as a whole;

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the pharmaceutical industry as a whole and do not have a materially disproportionate adverse effect on BioSciences and its subsidiaries or Ampio and its subsidiaries, respectively, taken as a whole, relative to other participants in the pharmaceutical industry;

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any change, in and of itself, in, Ampio’s stock price or trading volume, or any failure, in and of itself, by BioSciences or Ampio, respectively, to meet any internal projections; or

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the announcement of the merger agreement and the transaction contemplated thereby, the performance of and compliance with the terms of the merger agreement and the identity of Ampio or any of its affiliates as the acquiror of BioSciences.

Covenants

Conduct of Business Pending Merger. BioSciences has agreed that until the effective time of the merger, unless Ampio otherwise consents in writing or otherwise permitted by the merger agreement, it will, and will cause each of its subsidiaries to, conduct its respective businesses in the ordinary course of business and use commercially reasonable efforts to preserve intact its current business organizations, goodwill, rights and franchises and keep available the service of its officers and employees and preserve their relationships with those having business dealings with it.

In addition, BioSciences has agreed that until the merger is completed, BioSciences and its subsidiaries will not take certain actions listed in the merger agreement, which include the following actions, without Ampio’s prior written consent, except under limited circumstances specified in the merger agreement:

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issue, grant, deliver, sell, dispose, pledge or otherwise encumber its capital stock, or other ownership interests, or any securities or rights convertible into or exchangeable for any such shares or ownership interests or permit or authorize any of the above, other than in connection with the exercise of stock options that were outstanding on December 31, 2010;

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redeem, purchase or otherwise acquire, or propose to redeem, purchase or otherwise acquire its or its subsidiaries capital stock or indebtedness, or any securities convertible into or exercisable for any shares of its or its subsidiaries capital stock;

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split, combine, subdivide or reclassify any of its or its subsidiaries capital stock;

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declare, set aside for payment or pay any dividend, or make any other actual, constructive or deemed distribution in respect of its or its subsidiaries capital stock, or make any other payments to its shareholders or its subsidiaries in their capacity as such, other than dividends by a wholly owned BioSciences subsidiary to BioSciences or any of its subsidiaries;

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adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of it or any of its subsidiaries;

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amend its articles of incorporation or by-laws or alter through merger, liquidation, reorganization, restructuring or in any other fashion the corporate structure or ownership of any of its subsidiaries;

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make any material acquisition or any material disposition of assets or securities of any business organization or division thereof;

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make any material capital expenditures that are not consistent in timing and amount with past practice, incur any indebtedness or guarantee any such indebtedness or make any loans, advances or capital contributions to, or investments in, any other person, other than to it or any of its subsidiaries, except as consistent with past practice or to the extent required by a material contract;

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pay or agree to pay any severance, termination, pension or employment plans or agreements, as in effect on December 31, 2010, to any of its directors, officers, employees, consultants or agents, whether past or present;

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enter into any new or materially amend any existing employment or severance or termination agreement with any of its current or former directors or officers, except as contemplated by any executive officer agreement entered into by Ampio with the officers of BioSciences;

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grant any increases in the compensation of any of its directors or officers;

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increase or commit to increase the compensation of any of its or its subsidiaries’ employees (other than officers and directors), or pay or commit to pay any bonus, profit sharing or other similar payment to such persons;

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grant or commit to grant to any of its or any of its subsidiaries’ employees, officers, shareholders, directors, consultants or agents any new or modified severance, change of control, termination, retention or similar arrangement or increase or accelerate any benefits payable under its severance, retention or termination pay policies in effect on December 310, 2010;

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except in the ordinary course of business consistent with past practice or as may be required to comply with applicable laws, become obligated under any new employee benefit plan, severance plan, benefit arrangement, or similar plan or arrangement, which was not in existence on December 31, 2010, or amend any such plan or arrangement in existence on December 31, 2010, if such amendment would have the effect of materially enhancing any benefits thereunder;

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amend, modify or waive the right of it or its subsidiaries to require a release of claims under the terms of any employment agreement, benefit plan, severance policy or other agreement providing a release of claims as a condition to the payment of benefits;

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make any material tax election, change any material tax election already made, file any amended tax returns or settle or compromise any material federal, state, local or foreign income tax liability;

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make any change in its accounting principles or methods except insofar as may be required by a change in GAAP or change its or any of its subsidiaries’ independent public accountants;

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(i) pay, discharge or satisfy any material claims (including claims of shareholders), liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), except for the payment, discharge or satisfaction of liabilities or obligations in the ordinary course of business consistent with past practice or in accordance with their terms as in effect on December 31, 2010, or (ii) waive, release, grant or transfer any rights of material value or modify or change in any material respect any existing material license, lease, contract or other document, other than in the ordinary course of business consistent with past practice;

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enter into any collective bargaining agreement or other agreement with any labor organization, union or association;

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settle or compromise any litigation;

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(i) other than in the ordinary course of business consistent with past practice or as expressly permitted by the merger agreement, terminate, renew, amend or modify in any material respect, or fail to enforce any material provision of, any of its material contracts or (ii) enter into any material contract not in the ordinary course of business consistent with past practice and not terminable by it or any of its subsidiaries party thereto without penalty on notice of ninety (90) days or less;

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take any action that will create a requirement to make an application with, or seek the waiver, consent or approval of, the FDA or any similar regulatory body or any other government entity other than in the ordinary course of business consistent with past practice or in response to filings initiated by such government entities or other parties, or discontinue or withdraw any authorized service or voluntarily relinquish any material license or institute any proceeding with respect to, or otherwise materially change, amend or supplement its rights to Zertane; or

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authorize, recommend, propose or announce an intention to do any of the foregoing, or enter into any contract, agreement, commitment or arrangement to do any of the foregoing.

Ampio has agreed that until the merger is completed, Ampio will not take certain actions listed in the merger agreement, which include the following actions, without BioSciences prior written consent, except under limited circumstances specified in the merger agreement:

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adopt any amendments to its certificate of incorporation or by-laws which would have the effect of altering the terms of Ampio common stock;

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adopt a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization;

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enter into or consummate any transaction or transactions that would reasonably be expected to prevent the consummation of the transactions contemplated by the merger agreement; or

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authorize, recommend, propose or announce an intention to do any of the foregoing, or enter into any agreement to do any of the foregoing.

No Solicitation. The merger agreement precludes BioSciences, its subsidiaries, officers, directors, employees, investment bankers, legal counsel and other advisors and other representatives from directly or indirectly:

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soliciting, initiating, knowingly encouraging or taking any other action which could be reasonably expected to facilitate a competing transaction;

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engaging in negotiations or discussions concerning, or providing any non-public information to any person relating to, or taking any other action to facilitate any inquiries or the making of any proposal that constitutes, or could reasonably be expected to lead to, a competing transaction;

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entering into any letter of intent, agreement in principle, merger agreement, acquisition agreement, option agreement or similar document, agreement or commitment relating to or in connection with a competing transaction or requiring BioSciences to abandon, terminate or fail to consummate the merger; or

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waiving, amending, modifying or granting any release under any standstill or similar agreement or confidentiality agreement relating to a competing transaction.

However, prior to the adoption by BioSciences shareholders of the merger agreement, the BioSciences board of directors may furnish non-public information to, pursuant to an executed confidentiality agreement with terms no less favorable in all material respects than those contained in the confidentiality agreement between Ampio and BioSciences, or enter into discussions or negotiations with, any person regarding a bona fide written proposal or offer for a competing transaction, if:

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the board of directors of BioSciences determines in good faith, after consultation with BioSciences outside legal counsel and financial advisor, that such acquisition offer or proposal is, or is reasonably likely to lead to, a superior competing transaction and, after consultation with BioSciences outside legal counsel, that it is required to do so in order for it to comply with its fiduciary obligations to BioSciences shareholders;

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prior to determining that any proposal could result in a superior competing transaction, the BioSciences board of directors must notify Ampio of such offer or proposal and indicate, in connection with the notice, the material terms and conditions of the proposed competing transaction and the identity of the person making the competing transaction offer; and

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such competing transaction, proposal or offer was made after December 31, 2010, and did not result from a breach of the merger agreement.

The BioSciences board of directors also may make any disclosure to its shareholders if, in each case, in the good faith judgment of the board of directors, with the advice of outside counsel, making such disclosure to BioSciences shareholders is required under applicable law.

BioSciences is required to notify Ampio in writing promptly after receipt of any competing transaction offer or proposal or any request for material nonpublic information or access to its properties, books or records from any person, relating to or that could reasonably be expected to lead to a competing transaction. The notice must detail the identity of the offeror and the material terms and conditions of the proposal. BioSciences must also keep Ampio informed in all material respects of the status and details of any competing transaction.

“Competing transaction” is defined in the merger agreement as any proposal or offer made by any person, for:

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the acquisition by any person of assets or businesses that constitute fifteen percent (15%) or more of either the revenues, net loss or assets of BioSciences and its subsidiaries, taken as a whole;

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the acquisition by any person of fifteen percent (15%) or more of the outstanding shares of BioSciences common stock or any of its subsidiaries whose assets, individually or in the aggregate, constitute more than fifteen percent (15%) of the consolidated assets of BioSciences; or

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any other substantially similar transaction or series of related transactions that would reasonably be expected to prevent or materially impair or delay the consummation of the transactions contemplated by the merger agreement.

“Superior competing transaction” is defined in the merger agreement as a bona fide, written proposal or offer for a competing transaction made by a third person, which the BioSciences board of directors determines in good faith (after consultation with BioSciences outside legal counsel and financial advisor) may reasonably be likely to result in a transaction that, if consummated, would result in such third party (or its shareholders) owning, directly or indirectly, more than 65% of the shares of BioSciences common stock or all or substantially all the assets of BioSciences on terms more favorable to the shareholders of BioSciences from a financial point of view than the merger with Ampio and is reasonably capable of being consummated pursuant to the proposed terms.

Change of Recommendation. The BioSciences board of directors may not (i) withdraw, amend or modify, or publicly propose or resolve to withdraw, amend or modify its recommendation that the shareholders of BioSciences adopt the merger agreement, (ii) adopt or recommend, or propose publicly to adopt or recommend any letter of intent, agreement in principle, merger agreement, acquisition agreement, option agreement or similar document or agreement, arrangement or understanding constituting or relating to, or that is intended to or could reasonably expected to lead to, a competing transaction, or (iii) adopt or recommend, or propose publicly to adopt or recommend any competing transaction, except in the case where each of the following requirements is satisfied:

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the shareholders of BioSciences have not yet adopted the merger agreement;

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BioSciences receives an unsolicited competing transaction that the BioSciences board of directors reasonably determines (after consultation with BioSciences outside counsel and financial advisors) constitutes a superior competing transaction and was made after December 31, 2010, and not withdrawn;

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the BioSciences board of directors determines in good faith (after taking into account advice of outside counsel) that, in light of such superior competing transaction, that withdrawing its recommendation or terminating the merger agreement is required in order for the BioSciences board of directors to comply with its fiduciary obligations to BioSciences shareholders under applicable law;

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such acquisition proposal was not solicited, initiated, knowingly encouraged or facilitated after December 31, 2010 in breach of, and did not otherwise result from a breach of, the merger agreement;

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the BioSciences board of directors has notified Ampio in writing of the determination described above in accordance with the merger agreement; and

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at least three (3) business days following receipt by Ampio of the notice has elapsed and taking into account any revised proposal by Ampio, the board of directors of BioSciences maintains its determination described above.

The BioSciences board of directors does not, however, have any right to cause BioSciences to terminate the merger agreement in connection with a superior competing transaction.

Information Statement/Prospectus; Registration Statement. Ampio and BioSciences agreed to prepare this information statement/prospectus and the registration statement on Form S-4 in which it is included, and to file them with the SEC and use all reasonable efforts to have the registration statement declared effective by the SEC. Ampio is also required to take all necessary actions as may be required under applicable state “blue sky” or securities laws.

BioSciences is required under the terms of the amended merger agreement to use its reasonable best efforts to mail this information statement/prospectus to its shareholders within four (4) calendar days after the registration statement is declared effective. BioSciences has agreed to recommend that BioSciences shareholders adopt the merger agreement and approve the merger and the other transactions contemplated thereby, and it, acting through its board of directors, must use its reasonable best efforts to obtain such adoption and approval from the BioSciences shareholders by written consent. This obligation to use such reasonable best efforts to obtain adoption of the merger agreement and approval of the merger and the other transactions contemplated thereby is not to be limited by the commencement, disclosure, announcement or submission of any competing transaction (whether or not it is a superior competing transaction), or by any change, withholding or withdrawal of the BioSciences board of directors’ recommendation that BioSciences shareholders approve the merger agreement. Except as described above under “—Covenants; Change of Recommendation,” the BioSciences board of directors may not withdraw or modify, in a manner adverse to Ampio, the recommendation of the BioSciences board of directors that BioSciences shareholders adopt the merger agreement and approve the merger and the other transactions contemplated thereby.

Filings; Other Actions. Both Ampio and BioSciences will use all reasonable best efforts to take all actions, and do and assist and cooperate in doing all things necessary, proper or advisable to consummate and make effective the merger. Ampio and BioSciences are to use all reasonable efforts to resolve any objections or challenges from any regulatory authorities. Ampio will have primary responsibility, with the assistance and cooperation of BioSciences, for obtaining all authorizations, consents, orders and approvals with respect to the material intellectual property and licenses held by BioSciences.

Access to Information. The merger agreement requires BioSciences to provide Ampio reasonable access to its officers, employees, accountants, consultants, representatives, plants, properties, contracts, commitments, books and

records, and it must promptly furnish all information concerning its business, properties and personnel as may reasonably be requested. BioSciences must also furnish to Ampio unaudited interim consolidated statements of operations of BioSciences and its subsidiaries as soon as practicable following the end of each month and all financial reports regularly provided to management in the ordinary course of business consistent with BioSciences past practice. Any such information received by either party will be treated in accordance with the confidentiality agreement executed between Ampio and BioSciences.

Publicity. Both Ampio and BioSciences will, subject to certain exceptions, consult with each other and will mutually agree upon any press release or public announcement pertaining to the merger before the issuance of such press release or public announcement except as may be required by applicable law or by obligations pursuant to any agreement with any national securities exchange or automated quotations system.

Tax Matters. Both Ampio and BioSciences are required to use reasonable best efforts to avail themselves of any available exemptions with respect to transfer taxes and to cooperate with each other to provide any information and documentation necessary to obtain such exemptions. BioSciences is required to deliver to Ampio a certificate that satisfies the requirements of Treasury Regulation Section 1.1445-2(c)(3).

Certain Notices. Each of Ampio and BioSciences are required to notify the other party if any representation or warranty that is qualified as to materiality made by it in the merger agreement becomes incorrect in any respect or any such representation or warranty that is not so qualified becomes incorrect in any material respect or if such party fails to comply with or satisfy in any material respect any covenant, condition or agreement to be complied with or satisfied by it under the merger agreement.

Conditions to the Merger

Conditions to the obligations of each party. The obligations of each party to complete the merger are subject to the satisfaction of the following conditions:

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the approval and adoption of the merger agreement by at least 66²/3% of the BioSciences shareholders;

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the absence of any statute, rule, regulation, executive order, decree, ruling or injunction prohibiting the consummation of the merger;

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the continuing effectiveness of the registration statement in which this information statement/prospectus is included.

Conditions to the obligations of BioSciences. The obligations of BioSciences to consummate the merger are subject to the satisfaction of the following further conditions:

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the representations and warranties of Ampio and Merger Sub relating to:

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corporate authority, and due authorization and enforceability of the merger agreement;

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capitalization of Ampio and its subsidiaries;

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the accuracy of certain reports and financial statements filed by Ampio with the SEC;

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the absence of litigation or other proceedings that would reasonably be expected to materially delay or interfere with, prevent or otherwise make unduly burdensome, the merger; and

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the absence of finders’ or brokers’ fees,

are correct at and as of the effective time as if made at and as of such time, or if such representations and warranties are made as of a specific date, then at and as of such date;

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all the other representations and warranties of Ampio and Merger Sub contained in the merger agreement are correct (disregarding all exceptions for materiality) at and as of the effective time as if made at and as of such date except for changes permitted by the merger agreement and those representations made as of a specific date (which are correct as of such date), or where the failure of any representation or warranty to be correct has not had and would not reasonably be expected to have, individually or in the aggregate, a material adverse effect on Ampio;

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Ampio and Merger Sub have performed and complied with, in all material respects, their material obligations under the merger agreement to be performed or complied with on or prior to the effective time; and

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Ampio must have not experienced a material adverse effect.

Conditions to the obligations of Ampio and Merger Sub. The obligations of Ampio and Merger Sub to consummate the merger are subject to the satisfaction of the following further conditions:

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the representations and warranties of BioSciences relating to:

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corporate authority, and due authorization and enforceability of the merger agreement, and the consent required by BioSciences shareholders to approve and adopt the merger agreement;

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the capitalization of BioSciences and its subsidiaries;

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the accuracy of certain financial statements provided by BioSciences to Ampio;

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the absence of litigation or other proceedings that would reasonably be expected to materially delay or interfere with, prevent or otherwise make unduly burdensome, the merger; and

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the absence of finders’ or brokers’ fees, except with respect to fees and expenses payable by BioSciences to its financial advisor,

are correct at and as of the effective time as if made at and as of such time, or if such representations and warranties are made as of a specific date, then at and as of such date;

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all the other representations and warranties of BioSciences contained in the merger agreement are correct (disregarding all exceptions for materiality) at and as of the effective time as if made at and as of such date except for changes permitted by the merger agreement and those representations made as of a specific date (which are correct as of such date, or where the failure of any representation or warranty to be correct has not had and would not reasonably be expected to have, individually or in the aggregate, a material adverse effect on BioSciences;

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BioSciences having performed and complied with, in all material respects, its material obligations under the merger agreement to be performed or complied with on or prior to the effective time;

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BioSciences and its affiliates must have executed the donation to capital agreement; BioSciences and the noteholders must have executed the conversion agreement, and the noteholders and the Ampio affiliates must have executed the tag-along agreement; and BioSciences and its affiliates must have executed the cancellation agreement;

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BioSciences must have not experienced a material adverse effect; and

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No more than four percent (4%) of holders of the outstanding shares of BioSciences common stock shall have exercised dissenters’ rights for their shares.

Termination

Termination by the parties. The merger agreement may be terminated by the mutual written consent of Ampio and BioSciences. Additionally, either Ampio or BioSciences may terminate the merger agreement if:

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BioSciences shareholders holding at least 66²/3% of the BioSciences common stock fail to approve and adopt the merger agreement in accordance with the merger agreement, as amended, and the consent agreement;

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the merger is not consummated by June 15, 2011(which date can be extended by Ampio and BioSciences if a reason the closing has not occurred is because the registration statement that includes this information statement/prospectus has not been declared effective by such date, in which case the parties have agreed to restructure the merger as an asset purchase on mutually acceptable terms);

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there are final, non-appealable legal restraints preventing the merger; or

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any statute, rule, regulation, executive order, decree, ruling or injunction prohibiting the consummation of the merger has been adopted or issued;

provided that, in each case, neither Ampio nor BioSciences may terminate the merger agreement if the failure to fulfill any of their respective obligations under the merger agreement results in such failure to close.

Termination by Ampio. The merger agreement may be terminated by Ampio if:

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a breach of any representation, warranty, covenant or agreement on the part of BioSciences set forth in the

merger agreement has occurred that would cause any of the conditions described under “—Conditions to the Merger” not to be satisfied, and either such condition is not cured, or incapable of being cured, within thirty (30) days of written notice of such breach or inaccuracy;

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the BioSciences board of directors makes a recommendation change adverse to Ampio or the merger, approves an acquisition agreement other than the merger agreement, or approves or recommends a competing transaction, as described above under “—Covenants—Change of Recommendation;” or

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BioSciences fails to mail this information statement/prospectus within four (4) calendar days after the registration statement that contains this information statement/prospectus is declared effective by the SEC.

Termination by BioSciences. The merger agreement may be terminated by BioSciences if a breach of any representation, warranty, covenant or agreement on the part of Ampio or Merger Sub set forth in the merger agreement has occurred that would cause any of the conditions described under “—Conditions to the Merger—Conditions to the obligations of BioSciences” not to be satisfied, and either such condition is not cured, or incapable of being cured, within thirty (30) days of written notice of such breach or inaccuracy.

Modification or Amendment; Waiver

Modification or Amendment. The merger agreement may be modified or amended by the written agreement of BioSciences and Ampio at any time prior to the effective time of the merger, whether before or after adoption of the merger agreement by the BioSciences shareholders. However, following such adoption, no amendment of the merger agreement will be made that changes the consideration payable in the merger or requires further approval of the BioSciences shareholders under any applicable laws or rules, without the approval of the BioSciences shareholders.

Waiver of Conditions. Either Ampio or BioSciences may, to the extent permitted by applicable law, waive the conditions to each respective party’s individual obligations to consummate the merger that are for their sole benefit. Any such waiver will be valid only if set forth in writing and signed by the party granting the waiver. However, following such stockholder adoption of the merger agreement, no such waiver will be made that requires further approval of the BioSciences shareholders under any applicable laws or rules, without the approval of the BioSciences shareholders.

Transaction Fees and Expenses

The merger agreement provides that each party will pay its own fees and expenses in connection with the merger agreement.

DISSENTERS’ RIGHTS

Article 113 of the Colorado Business Corporation Act, or the CBCA, grants certain rights to obtain payment for their shares to dissenting shareholders of a Colorado corporation such as BioSciences with respect to a merger. Strict statutory procedures set forth in Section 7-113-202 of the CBCA must be followed by dissenting shareholders and failure to do so will result in forfeiture of the rights to payment, and cause such shareholders to be bound by such actions. BioSciences will require strict compliance with the statutory procedures set forth in the CBCA. A shareholder may assert rights to payment with respect to all or a portion of the stock held.

To BioSciences Shareholders: IN ORDER FOR YOU TO EXERCISE DISSENTERS’ RIGHTS, YOU MUST MAKE A WRITTEN DEMAND UPON BIOSCIENCES AND DEPOSIT THE CERTIFICATES FOR YOUR CERTIFICATED SHARES AS PROVIDED IN THE CBCA. THE NOTICE MUST BE RECEIVED BY BIOSCIENCES BEFORE 30 DAYS FROM THE DATE OF THIS INFORMATION STATEMENT/PROSPECTUS. THE CERTIFICATES MUST BE DEPOSITED AS SET FORTH BY BIOSCIENCES IN ITS DISSENTERS’ NOTICE AND YOU MUST COMPLY WITH SUCH OTHER PROCEDURES AS REQUIRED BY THE CBCA, AS MORE FULLY DESCRIBED BELOW. FAILURE TO SEND THE REQUIRED DISSENTERS’ NOTICE OR TO FOLLOW SUCH OTHER PROCEDURES WILL RESULT IN A WAIVER OF YOUR DISSENTERS’ RIGHTS.

Notification of Merger

Delivery of this information statement/prospectus to you constitutes your notice, pursuant to the CBCA, that appraisal rights may be available to you. A copy of Article 113 of the CBCA is attached as Annex D.

Exercising Dissenters’ Rights

The following summary of the provisions of Article 113 is not intended to be a complete statement of such provisions and is qualified in its entirety to the full text of Article 113, a copy of which is attached to this information statement/prospectus as Annex D, and incorporated herein by reference. The BioSciences shareholders who have agreed to sign the consent approving the merger have effectively waived their dissenters’ rights.

Shareholders of a Colorado corporation have the right, in limited circumstances, to dissent from certain corporate actions, including the consummation of a merger which requires the approval of such corporation’s shareholders. Shareholders entitled to dissent are also entitled to obtain a cash payment in the amount of the fair value of their shares. The holders of BioSciences common stock have these rights with respect to the merger.

A holder of common stock who wishes to assert dissenters’ rights under Article 113 must within 30 days of the date of this information statement/prospectus provide written notice to BioSciences of the holder’s intention to demand a cash payment for the holder’s shares of common stock on consummation of the merger. A holder of BioSciences common stock who fails to satisfy these requirements will not be entitled to dissenters’ rights under Article 113.

A shareholder who wishes to obtain a cash payment for his or her shares of BioSciences common stock must demand a cash payment by stating such demand in writing, and depositing the shareholder’s certificate(s) for certificated shares. BioSciences may restrict the transfer of any shares not represented by a certificate from the date the demand for cash payment is received. The shareholder demanding a cash payment in accordance with Section 7-113-204 shall retain all rights of a shareholder, except the right to transfer shares, until the effective date of the merger. A shareholder who does not provide demand for a cash payment by the dates set forth in the dissenters’ notice and in accordance with Section 7-113-204 will not be entitled to a cash payment for his or her shares of BioSciences common stock as provided in the CBCA.

Pursuant to Sections 7-113-206 and 207 of the CBCA, upon the effective date of the transactions or upon receipt of a cash payment demand, whichever is later, BioSciences must pay each dissenter who complied with Section 7-113-204 the amount of cash that BioSciences estimates to be the fair market value of the shares, plus accrued interest. The cash payment must be accompanied by (i) certain financial information regarding BioSciences; (ii) a statement of BioSciences estimate of the fair value of the shares; (iii) an explanation of how the interest was calculated; (iv) a statement of the dissenter’s right to demand a cash payment under Section 7-113-209; and (v) a copy of Section 7-113-206 of the CBCA.

Section 7-113-208 of the CBCA permits BioSciences to require each shareholder to certify in writing, or in the dissenter’s cash payment demand, whether or not the dissenter acquired beneficial ownership of his or her shares of common stock before the date of the first announcement to the news media or to the shareholders, with such date to be set forth in the dissenters’ notice. If any dissenter does not so certify in writing, BioSciences may offer to make a cash payment if the dissenter agrees to accept such payment in full satisfaction of the demand for a cash payment.

A dissenter may give written notice to BioSciences to which demand was provided, within 30 days after BioSciences makes or offers a cash payment for the dissenter’s shares of common stock, of the dissenter’s estimate of the fair value of such shares and of the amount of interest due and may demand cash payment of such estimate, or reject the receiving company’s offer under Section 7-113-208 and demand a cash payment of the fair value of the shares and interest due if: (i) the dissenter believes that the amount of cash paid pursuant to Section 7-113-206 or offered pursuant to Section 7-113-208 is less than the full value of his or her shares of common stock or that the interest due was incorrectly calculated; (ii) BioSciences fails to make a cash payment as required under Section 7-113-206 within the time specified above; or (iii) BioSciences does not return the deposited certificates as required by Section 7-113-207. Dissenters who do not give the required notice waive the right to demand a cash payment under Section 7-113-209.

If a demand for a cash payment under Section 7-113-209 remains unresolved, BioSciences may, within 60 days after receiving the cash payment demand, petition the court to determine the fair value of the shares of common stock and accrued interest. All dissenters of BioSciences whose demands remain unsettled would be made a party to such a proceeding. Each dissenter is entitled to judgment for the amount the court finds to be the fair value of the shares of BioSciences common stock, plus interest, less any amount paid by BioSciences. The costs associated with this proceeding shall be assessed against BioSciences, unless the court finds that all or some of the dissenters acted arbitrarily, vexatiously, or not in good faith in demanding cash payment under Section 7-113-209, in which case the court may assess the costs in the amount the court finds equitable against some or all of the dissenters. The court may also assess the fees and expenses of counsel and experts for the respective parties in amounts the court finds equitable, against BioSciences or the dissenters. In determining fair value, the court is required to take into account all relevant factors. You should be aware that the fair value of your shares as determined by the court could be more, the same, or less than the value of the Ampio common stock that you are entitled to receive on consummation of the merger. If BioSciences does not commence a proceeding within the 60-day period, BioSciences must pay each dissenter whose demand remains unsettled the amount of cash demanded.

Only Record Holders May Exercise Dissenters’ Rights

Only a record holder of BioSciences common stock may be entitled to exercise dissenters’ appraisal rights. The demand must be executed by or for the record holder, fully and correctly, as the holder’s name appears on the holder’s stock certificate(s).

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If shares of BioSciences common stock are owned of record in a fiduciary capacity, such as by a trustee, guardian or custodian, the demand should be executed in that capacity.

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If shares of BioSciences common stock are owned of record by more than one person, as in a joint tenancy or tenancy in common, the demand should be executed by or for all owners.

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An authorized agent, including one of two or more joint owners, may execute the dissenters’ exercise notice for a holder of record. The agent must identify the owner or owners of record and expressly disclose the fact that, in executing the demand, the agent is acting as agent for the owner or owners of record.

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A holder of record, such as a broker, who holds shares of BioSciences common stock as nominee for a beneficial owner, may exercise a holder’s right of appraisal with respect to shares of BioSciences common stock held for all or less than all of that beneficial owner’s interest. In that case, the written demand should set forth the number of shares of BioSciences common stock covered by the demand. If no number of shares is expressly mentioned, the demand will be presumed to cover all of the shares of BioSciences common stock standing in the name of the record holder. Holders of BioSciences common stock who hold their shares in brokerage accounts or through any other nominee and wish to exercise dissenters’ rights should consult their brokers or other nominees to determine the procedures they must follow in order for their brokers and other nominees to exercise dissenters’ rights in respect of their shares of BioSciences common stock.

In view of the complexity of Article 113, shareholders of BioSciences who may wish to dissent from the merger should consult their legal advisors. Failure to take any necessary step will result in a termination or waiver of your rights under Article 113 of the CBCA.

Address for Delivery of Exercise Notice

A notice of exercise of dissenters’ rights must be delivered to: Bruce G. Miller, President, DMI BioSciences, Inc., 5445 DTC Parkway, P4, Greenwood Village, Colorado 80111.

Effect of Notice of Dissenters’ Rights Exercise on Voting and Right to Dividends

Any shareholder who has duly exercised dissenters’ rights in compliance with Colorado law will not, after the effective time of the merger, be entitled to vote the shares subject to the demand for any purpose. The shares subject to the demand will not be entitled to dividends or other distributions, other than those payable or deemed to be payable to shareholders of record as of a date prior to the effective time.

Loss, Waiver or Withdrawal of Dissenters’ Rights

Holders of BioSciences common stock will lose the right to exercise dissenters’ rights if no written notice of exercise of dissenters’ rights is delivered to BioSciences within 30 days after the date this information statement/prospectus is mailed to BioSciences shareholders. A shareholder will also lose the right to exercise dissenters’ rights by delivering to BioSciences a written withdrawal of the stockholder notice of exercise of dissenters’ rights. Any attempt to withdraw a notice of exercise of dissenters’ rights that is made more than 60 days after the effective time of the merger requires Ampio’s written approval. If dissenters’ rights are not perfected or a notice of exercise of dissenters’ rights is timely withdrawn, a shareholder will be entitled to receive the consideration otherwise payable pursuant to the merger. The number of shares of Ampio common stock, and cash instead of a fraction of a share of Ampio common stock, delivered to such stockholder will be based on the same exchange ratio utilized in the merger, regardless of the market price of shares of Ampio common stock at the time of delivery.

MATERIAL UNITED STATES FEDERAL INCOME TAX CONSEQUENCES

The following is a summary of the material United States federal income tax consequences of the merger to holders of BioSciences common stock. The summary is based on the Internal Revenue Code of 1986, as amended, or the Code, Treasury regulations thereunder and administrative rulings and court decisions in effect as of the date of this document, all of which are subject to change at any time, possibly with retroactive effect. It is important to note that we have not obtained a tax opinion from Ampio or BioSciences counsel or a ruling from the Internal Revenue Service concerning the the United States federal income tax consequences of the merger.

This discussion only addresses BioSciences shareholders that hold their shares of BioSciences common stock as a capital asset within the meaning of Section 1221 of the Code. This discussion does not address the tax consequences of transactions effectuated prior or subsequent to, or concurrently with, the merger (whether or not such transactions are undertaken in connection with the merger). In addition, this discussion does not address the effects of the merger under any state, local or foreign tax laws. Further, this summary does not address all aspects of U.S. federal income taxation that may be relevant to a BioSciences shareholder in light of such holder’s particular circumstances or that may be applicable to holders subject to special treatment under United States federal income tax laws, including, without limitation:

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a bank or other financial institution;

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a tax-exempt organization;

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an S corporation or other pass-through entity;

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an insurance company;

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a mutual fund;

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a regulated investment company or real estate investment trust;

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a dealer or broker in stocks and securities, or currencies;

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a trader in securities that elects mark-to-market treatment;

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a holder of BioSciences common stock subject to the alternative minimum tax provisions of the Code;

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a holder of BioSciences common stock that received such BioSciences common stock through the exercise of an employee stock option, pursuant to a tax qualified retirement plan or otherwise as compensation;

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a person that is not a U.S. holder (as defined below);

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a person that has a functional currency other than the U.S. dollar;

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a holder of BioSciences common stock that holds such BioSciences shares as part of a hedge, straddle, constructive sale, conversion or other integrated transaction; or

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a U.S. expatriate.

HOLDERS ARE URGED TO CONSULT WITH THEIR TAX ADVISORS REGARDING THE TAX CONSEQUENCES OF THE MERGER TO THEM, INCLUDING THE EFFECTS OF UNITED STATES FEDERAL, STATE AND LOCAL, FOREIGN AND OTHER TAX LAWS.

For purposes of this discussion, the term “U.S. holder” means a beneficial owner of BioSciences common stock that is for U.S. federal income tax purposes (1) an individual citizen or resident of the United States, (2) a corporation, including any entity treated as a corporation for U.S. federal income tax purposes, created or organized in or under the laws of the United States, any state thereof or the District of Columbia, (3) a trust if (x) a U.S. court is able to exercise primary supervision over the trust’s administration and one or more U.S. persons are authorized to control all substantial decisions of the trust or (y) it has a valid election in effect under applicable Treasury regulations to be treated as a U.S. person, or (4) an estate that is subject to U.S. federal income tax on its income regardless of its source.

The U.S. federal income tax consequences of the merger to a partner in an entity or arrangement treated as a partnership for U.S. federal income tax purposes that holds BioSciences common stock generally will depend on the status of the partner and the activities of the partnership. Partners in a partnership holding BioSciences common stock should consult their own tax advisors.

Consequences of the Merger Generally

The merger has been structured to qualify as reorganization under Section 368(a) of the Code for United States federal income tax purposes. Accordingly, the exchange is expected to be tax-free to holders of BioSciences common stock. Specifically, the following material federal income tax consequences are expected to apply:

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a holder will not recognize any gain or loss upon receipt of Ampio common stock solely in exchange for BioSciences common stock, including whole shares issued upon rounding up of fractional shares;

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the aggregate tax basis of the shares of Ampio common stock received in the merger will be equal to the aggregate tax basis in the shares of BioSciences common stock surrendered; and

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the holding period of the Ampio common stock received in the merger (including any whole shares issued in lieu of fractional shares) will include the holding period of the shares of BioSciences common stock surrendered.

No ruling has been or will be sought from the Internal Revenue Service as to the United States federal income tax consequences of the merger. Accordingly, there can be no assurances that the Internal Revenue Service will not disagree with or challenge any of the conclusions described herein.

Dissenting Shareholders

Shareholders of BioSciences who receive cash for their common stock as a result of exercising statutory dissenters’ rights will be treated as having received a distribution in redemption of their stock that is subject to Section 302 of the Code. Assuming that the requirements of Section 302 are satisfied, such shareholders will have a taxable capital gain (or capital loss), measured by the difference between the cash payment received and their tax basis in the shares as to which the dissenters’ rights are exercised, assuming those shares are held as capital assets when the dissenters’ rights are elected. In general, such shareholders should also be able to reduce that capital gain (or increase that capital loss) by the amount of any expenses they incur in pursuing or prosecuting their dissenters’ rights. Dissenting stockholders should consult their own tax advisors regarding the application of Section 302.

This summary of the material U.S. federal income tax consequences of the merger to holders of BioSciences common stock is for general information only and is not tax advice. The determination of the actual tax consequences of the merger to a holder of BioSciences common stock will depend on the holder’s specific situation. Holders of BioSciences common stock should consult their own tax advisors as to the tax consequences of the merger in their particular circumstances, including the applicability and effect of the alternative minimum tax and any state, local, foreign or other tax laws and of changes in those laws.

THE COMPANIES

In addition to the information concerning Ampio below, we have included additional information about (1) Ampio’s business, including information concerning Ampio’s product candidates, business strategy, intellectual property, government regulations to which Ampio is subject, property, employees and related topics, (2) the executive officers and directors of Ampio both before and after the merger, (3) executive compensation and corporate governance information, (3) related party transactions between Ampio, on the one hand, and BioSciences, Ampio’s executive officers, directors, and 5% or more shareholders, on the other hand, and (4) Ampio’s principal shareholders, in Annex C to this information statement/prospectus. We encourage you to review in its entirety the information in Annex C for additional information on these subject matters as they relate to Ampio. You may also view Ampio’s Code of Conduct and Ethics, and the Charters of its Nominating and Governance, Audit and Compensation Committees on Ampio’s web site, www.ampiopharma.com, by clicking on the “Corporate Governance” tab under the “Investor Relations” menu.

Ampio

We are a development stage pharmaceutical company engaged in the discovery and development of innovative, proprietary pharmaceutical and diagnostic products to identify and treat inflammatory conditions, including metabolic disorders and diabetic complications. We have a disciplined strategy and productive innovation platform that generates compounds and diagnostics with large potential value while minimizing development risk, cost, and time. Our discovery process occurs in a true clinical environment that carries low overhead costs. Each drug candidate undergoes a sophisticated business filter to identify products that can be clinically and cost-effectively developed to generate substantial value and returns while minimizing risk. Our strategy focuses on generating human safety and efficacy data in order to position our product candidates for value-creating licensing agreements with strategic partners, and is not focused on conducting FDA-directed clinical trials.

Ampio Pharmaceuticals has several unique characteristics that are unlike similar stage companies:

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a range of substantive products that are the result of our innovation process, have strong patent or patent pending positions, multi-billion dollar markets, and shorter regulatory paths than new molecular entities, or NMEs;

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a licensing-focused strategy based on conducting safety and efficacy trials geared towards understanding a drug’s potential for addressing multiple clinical indications, not by first pursuing FDA-centric clinical trials;

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an innovative and proprietary drug discovery process that rapidly identifies candidates for large unmet clinical needs at considerably lower cost than NME product candidates;

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access to clinical and scientific resources as a result of a contractual agreement and long-term relationship with Trauma Research LLC, or TRLLC, a related party controlled by our chief scientific officer; and

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a sophisticated business filter, clinical review and intellectual property evaluation that select clinically and commercially valuable products coupled with a rapid development timeframe to reach significant value creation.

Our Drug Discovery Platform

Clinical Discovery Process

Our disciplined innovative drug discovery process begins with input from clinicians in the field, not research in the lab, and is guided primarily by patent strength, solving an unmet need, and identifying repositioned product candidates previously approved for other indications by the FDA or biologics. This process is built on clinical observations and patient data gathered under appropriate IRB supervision from clinicians who collaborate closely with Ampio scientists and TRLLC clinicians. As a result of these unique collaborative agreements and historic relationships, we obtain access to research and clinical resources at substantially lower cost than industry norms. As a result, our platform has generated lead product candidates, Optina™, Vasaloc™, Ampion™, and Zertane™ to address large unmet clinical needs.

Collaborations and Resources

Our chief scientific officer, Dr. David Bar-Or, collaborates with a team of biochemists, epidemiologists, molecular biologists, immunologist, computational biologists and nursing staff, and also oversees TRLLC, which provides accreditation services for two of the three Level I trauma centers in the State of Colorado. Over 120,000 emergency room consultations take place annually at these hospital facilities. Under a sponsored research agreement, Ampio funds a variety of targeted research projects conducted by TRLLC, allowing us to further the short term clinical aims of TRLLC and to obtain intellectual property rights to any resulting product candidates. This also provides us access to clinical observations, biology and scientific information we apply to product discovery and development. In collaboration with other professional colleagues who provide advisory input such as vascular surgeons, orthopedic surgeons, neurologists, nephrologists and ER specialists, Dr. Bar-Or uses a multi-disciplinary approach to evaluate clinical interaction that direct further research. The clinical team has access to a large patient database and blood samples for testing or validating drug candidates. With over a decade of scientific research supporting many of our developments, we have built an extensive patent portfolio with over 50 granted patents and a number of license arrangements.

Business Filter and Product Evaluation

We focus our development work on advancing product candidates that we believe offer significant therapeutic advantages over currently available treatments and which represent large potential markets. We look to advance product candidates that address multiple clinical indications, have proven safety profiles, and which can timely demonstrate clinical efficacy. We intend to continue to maintain a diversified product candidate pipeline to mitigate risks associated with pharmaceutical development and increase the likelihood of commercial success. During the development process, we review pertinent scientific literature and conduct searches of patent records in order to make a preliminary determination of patentability. As many of our product candidates are repositioned drugs, the nature and extent of potentially available patent protection is central to our development decisions.

Once identified, candidates are filtered and screened for:

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indirect evidence of efficacy based on review of related publications;

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market size, market acceptance and likely penetration;

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patentability and other modes for protecting exclusivity; and

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competitive products and manufacturing issues.

Cost Effective Clinical Strategy

In order to control development costs and expedite the commencement of clinical trials, we intend to conduct clinical trials at sites located in Canada, the European Union member states, Australia, India and perhaps countries in the Far East. We plan also to outsource manufacturing, and to out-license to collaborators the rights to sell and market, any product candidates that receive regulatory approval within or outside the U.S. We may also opportunistically enter into agreements with collaborators prior to licensing that may be country, region or application specific and that may lead to sublicenses. Although outsourcing may reduce income derived from any sales of approved products, our business model is premised on carefully controlling fixed overhead and development costs, creating a catalyst to value by identifying patent-protectable product candidates with significant commercial potential and clinical efficacy, and to support the licensee in advancing those product candidates through any additional required clinical trials and the regulatory approval process in order to position an approved product for global market entry.

Product Pipeline

Our disciplined innovation process is built on Dr. Bar-Or’s research on inflammation and its role in trauma, which is an ideal platform to study inflammation. Dr. Bar-Or has completed several ground-breaking studies on the role of transition metals in inflammation and ischemia and the composition of commercially available human serum albumin products and the effect of variations in composition on trauma patient outcomes. We believe his studies are valuable because of their originality and application to patient care, and because the results are obtained from well-preserved and characterized human biosamples without the confounding influence of interspecies differences. In this context, Dr. Bar-Or’s approach plays a key role in bridging the gulf between basic molecular-cellular research and human clinical research.

Two of our most advanced product candidates are repositioned drugs (Optina and Vasaloc) for which we are seeking U.S. and international patent protection covering their unique composition or application. Strategically, repositioned drugs reduce the risk of product failure due to adverse toxicology, lead to more modest investments during development, and may achieve more rapid marketing approval. Ampion is a biologic and being developed as a NME for inflammatory diseases. Because Ampion is naturally produced in the body to fight inflammation, we believe it has a favorable safety, efficacy, and risk profile. We have also developed an Oxidation Reduction Potential (ORP) diagnostic device which is now being prototyped for use in emergency rooms to assess stroke and chest pain stratification of patients.

We intend to demonstrate statistical proof of human efficacy of our product candidates for specific indications:

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Optina and Vasaloc, repurposed danazol with patents in process for complications of diabetes;

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Ampion, an innovative “biological” agent with composition of matter patent coverage and efficacy in treating inflammatory disorders, including osteoarthritis, rheumatoid disease and related disorders; and

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Oxidation Reduction Potential (ORP) Diagnostic Device, a diagnostic machine that measures the net oxidants and antioxidants in human blood to determine oxidative stress in the body to assess cardiovascular events and other inflammatory conditions.

Optina for Diabetic Macular Edema and Wet AMD

Optina is an orally-administered repositioned compound based on a low-dose formulation of approved drug danazol. Developed initially to treat endometriosis, danazol was first approved by the FDA in the early 1970’s and is a derivative of the synthetic steroid ethisterone. Dr. David Bar-Or, our chief scientific officer, has determined that danazol in low doses has the capability to control the permeability of tissues, thus reducing vascular leakage. Vascular permeability is a key endothelial mechanism by which inflammatory cytokines and angiogenic factors affect target cells and organs to mediate the inflammatory response or cell growth. During the disease state, there is an increase in vascular permeability factors leading to vasodilation, edema formation, and disruption of intercellular membrane structure.

Optina is designed to treat diabetic macular edema, or DME, and neovascular age-related macular degeneration, or wet AMD. If untreated, diabetic macular edema leads to moderate vision loss for one out of four diabetics over a period of three years and can lead to blindness over a period of seven years. We contracted with a Canadian hospital to conduct Phase II clinical trials of Optina for $0.97 million and expect patient enrollment to begin in January 2011. We believe this study will be completed in the second quarter of 2011. We intend to partner or entertain licensing opportunities once we have realized significant value for Optina’s application based on reported human safety and efficacy data. According to BCC Research, the market for DME and AMD in 2009 was over $2.4 billion in the U.S.

Approximately 14% of people with diabetes have DME. According to the American Academy of Ophthalmology, the prevalence of DME increases to 29% for people with diabetes who use insulin for more than 20 years. Existing therapies for DME and wet AMD include focal and grid laser therapy, which is the current standard of care, as well as photodynamic therapy, surgery, and intravitreal treatment for AMD using Lucentis. Lucentis is costly compared to alternative injection therapies. Avastin is currently approved only for cancer treatment, but it is being used off-label by ophthalmologists to treat DME and wet AMD. There are currently no oral medications available for treatment of DME and wet AMD. We believe Optina has the potential to effectively treat DME and wet AMD without costly laser therapy and without requiring ongoing injections of pharmaceuticals in the eye.

Vasaloc for Diabetic Nephropathy

Vasaloc, like Optina, is also based on low-dose danazol. Vasaloc is an orally-administered compound designed to treat diabetic nephropathy. Untreated diabetic nephropathy leads to kidney damage or renal failure. Approximately 20-30% of the estimated 20.8 million diabetics in the U.S. have diabetic nephropathy, according to the Cleveland Clinic. We expect to contract for Phase II clinical trials of Vasaloc to commence in the first quarter of 2011, and believe the trial will be completed by the first quarter of 2012. Our estimated cost for the trial is under $1.2 million.

Diabetes has become the most common single cause of end-stage renal disease in the U.S. and Europe. Standard modalities for the treatment of diabetic nephropathy include controlling blood glucose levels by using a variety of hormone therapies such as insulin, by stimulating the release of insulin using sulfonylureas, or through use of insulin derivatives. As high blood pressure is known to increase the rate of decline in renal function, diabetics are generally advised to control blood pressure using one or a combination of angiotensin-converting enzyme (ACE) inhibitors, Angiotensin II receptor blockers (ARBs), calcium channel blockers, diuretics, or beta-blockers. When renal failure occurs, dialysis is often required and a kidney transplant may become the only viable treatment option. We believe Vasaloc offers an effective means to treat diabetic nephropathy by reducing vascular permeability of nephrons and glomerulus, thereby stabilizing kidney function and reducing complications from kidney damage.

Ampion for Inflammation

Ampion is a non-steroidal biologic, aspartyl-alanyl diketopiperazine, referred to as DA-DKP. This compound is comprised of two amino acids derived from human blood, and is designed to treat chronic inflammatory and autoimmune diseases. Because it is a naturally occurring human molecule, DA-DKP is present in the body. Like danazol, Ampion has significant effects on vascular permeability when concentrated for clinical efficacy. Dr. Bar-Or has published a number of studies and articles on the anti-inflammatory immune response of DA-DKP. We intend to conduct pilot clinical studies on the effect of DA-DKP in patients suffering from multiple sclerosis, an autoimmune disease caused by nerve damage attributable to inflammation. There is currently no cure for MS and it is unknown what triggers the body’s inflammatory response. We plan to conduct four proof of concept studies of Ampion in India or Australia commencing in the second or third quarter of 2011, and expect these studies will take approximately 24 months to complete. Our estimated cost for each trial is under $0.5 million. We intend to partner or entertain licensing opportunities once we have realized significant value for Ampion through obtaining human efficacy data.

BioSciences

BioSciences, a Colorado corporation, holds the ownership rights to Zertane. Zertane is a new use for tramadol hydrocloride, which was approved for marketing as a noncontrolled analgesic in 1995. Based on the results of two clinical trials we conducted, we believe it can be an effective oral medication to treat premature ejaculation, or PE, in men. Premature ejaculation is the most common form of male sexual dysfunction and has a major impact on the quality of life for many men and their partners. The market opportunity is large, with an estimated 30% of males suffering from premature ejaculation (four times the number with erectile dysfunction). According to Australia’s Keogh Institute of Medical Research, PE is the most common sexual complaint in males. At present no drug has been approved by the FDA for the treatment of premature ejaculation. Priligy, an orally-administered anti-depressant in the SSRI class, has been approved for the treatment of PE in two European countries, where it is marketed by Janssen-Cilag, a unit of Johnson & Johnson. National approvals and licenses in five other European countries are expected to shortly follow. Behavioral therapy is the current standard of care for treatment of PE.

We granted an option to license Zertane to a large pharmaceutical company in 2007, and the option was exercised in January 2009. The licensee commenced two large Phase III clinical trials in Europe which were discontinued when the licensee terminated the license agreement in the second quarter of 2010, which we understand to have occurred due to a change in the licensee’s strategic direction. At that time, BioSciences regained all rights to develop, license and seek regulatory approval to market Zertane worldwide. BioSciences has obtained the clinical trial data from the pharmaceutical company and its CRO, and expects to complete its preliminary review of this data in January 2011. BioSciences has applied for patent protection for a combination of Zertane and an erectile dysfunction, or ED, medicine to offer male patients a single oral medication that will treat both PE and ED. A combination drug would address the significant co-morbid ED and PE population. We currently intend to partner or seek licensing opportunities for this Zertane drug combination.

DESCRIPTION OF AMPIO CAPITAL STOCK

The following summary is qualified in its entirety by the DGCL and the amended Certificate of Incorporation of Ampio. The Ampio certificate of incorporation is included as an exhibit to Ampio’s Current Report on Form 8-K which Ampio filed with the SEC on March 17, 2010. See “Where You Can Find More Information.”

Authorized and Issued Capital Stock

Ampio’s authorized capital stock consists of 100,000,000 shares of common stock, par value $0.0001 per share, of which 17,107,036 shares are issued and outstanding, and 2,000,000 shares of undesignated preferred stock, $0.0001 par value, of which no shares are issued or outstanding. Ampio’s common stock outstanding will increase to 22,274,941 shares upon closing of the BioSciences acquisition.

Common Stock

As of December 31, 2010, there were 17,107,036 shares of Ampio common stock outstanding held by approximately 250 shareholders of record. Upon closing of the BioSciences acquisition, the number of shares of Ampio common stock outstanding will increase to 22,274,941. Holders of common stock will have voting rights for the election of directors and all other matters requiring stockholder action, except with respect to amendments to the certificate of incorporation that alter or change the powers, preferences, rights or other terms of any outstanding preferred stock if the holders of such affected series of preferred stock are entitled to vote on such an amendment. There is no cumulative voting with respect to the election of directors, with the result that the holders of more than 50% of the shares voted for the election of directors can elect all of the directors. Holders of common stock will be entitled to one vote per share on matters to be voted on by shareholders and also will be entitled to receive such dividends, if any, as may be declared from time to time by Ampio’s board of directors in its discretion out of funds legally available therefor. The payment of dividends, if ever, on the common stock will be subject to the prior payment of dividends on any outstanding preferred stock, of which there is currently none. Upon Ampio’s liquidation or dissolution, the holders of common stock will be entitled to receive pro rata all assets remaining available for distribution to shareholders after payment of all liabilities and provision for the liquidation of any shares of preferred stock at the time outstanding. Ampio shareholders have no conversion, preemptive or other subscription rights and there are no sinking fund or redemption provisions applicable to the common stock.

Preferred Stock

Ampio’s certificate of incorporation provides that shares of preferred stock may be issued from time to time in one or more series. Ampio’s board of directors will be authorized to fix the voting rights, if any, designations, powers, preferences, the relative, participating, optional or other special rights and any qualifications, limitations and restrictions thereof, applicable to the shares of each series. Ampio’s board of directors will be able to, without shareholder approval, issue preferred stock with voting and other rights that could adversely affect the voting power and other rights of the holders of the common stock and could have anti-takeover effects. The ability of Ampio’s board of directors to issue preferred stock without shareholder approval could have the effect of delaying, deferring or preventing a change of control of Ampio or the removal of existing management. Ampio has no preferred stock outstanding at the date hereof. Although Ampio does not currently intend to issue any shares of preferred stock, Ampio cannot assure you that it will not do so in the future.

Dividends

Ampio has not paid any dividends on its common stock to date. It is the present intention of the Ampio board of directors to retain any earnings for use in Ampio’s business operations and, accordingly, Ampio does not anticipate the board declaring any dividends in the foreseeable future.

Our Transfer Agent

The transfer agent for Ampio common stock is Corporate Stock Transfer, Inc., 3200 Cherry Creek Drive South, Suite 430, Denver, Colorado 80209.

Certain Anti-takeover Provisions of Delaware Law and our Certificate of Incorporation and By-Laws

As a Delaware corporation, Ampio is governed by the provisions of Section 203 of the Delaware General Corporation Law, which generally has an anti-takeover effect for transactions not approved in advance by Ampio’s board of directors. This may discourage takeover attempts that might result in payment of a premium over the market price for the shares of common stock held by shareholders. In general, Section 203 prohibits a publicly held

Delaware corporation from engaging in a “business combination” with an “interested shareholder” for a three-year period following the time that such shareholder becomes an interested shareholder, unless the business combination is approved in a prescribed manner. A “business combination” includes, among other things, a merger, asset or stock sale or other transaction resulting in a financial benefit to the interested shareholder. An “interested shareholder” is a person who, together with affiliates and associates, owns, or did own within three years prior to the determination of interested shareholder status, 15% or more of the corporation’s voting stock.

Under Section 203, a business combination between a corporation and an interested shareholder is prohibited unless it satisfies one of the following conditions:

•

before the shareholder became interested, the board of directors approved either the business combination or the transaction which resulted in the shareholder becoming an interested shareholder; or

•

upon consummation of the transaction which resulted in the shareholder becoming an interested shareholder, shares owned by:

•

persons who are directors and also officers, and

•

employee stock plans, in some instances; or

•

at or after the time the stockholder became interested,

the business combination was approved by the board of directors of the corporation and authorized at an annual or special meeting of the shareholders by the affirmative vote of at least two-thirds of the outstanding voting stock which is not owned by the interested shareholder.

Staggered board of directors

Ampio’s Delaware certificate of incorporation and by-laws provide that its board of directors will be classified into three classes of directors of approximately equal size at a date selected by the board. As a result, in most circumstances, a person can gain control of the Ampio board only by successfully engaging in a proxy contest at two or more annual meetings.

Shareholder action; special meeting of shareholders

Ampio’s Delaware certificate of incorporation provides that following an underwritten offering, our stockholders may not take any action by written consent, but only take action at duly called annual or special meetings of shareholders. Ampio’s by-laws further provide that special meetings of our shareholders may be only called by the Ampio board of directors with a majority vote of the Ampio board of directors, by our chief executive officer, or the chairman.

Advance notice requirements for shareholder proposals and director nominations

Ampio’s by-laws provide that shareholders seeking to bring business before our annual meeting of shareholders, or to nominate candidates for election as directors at our annual meeting of shareholders, must provide timely notice of their intent in writing. To be timely, a shareholder’s notice needs to be delivered to our principal executive offices not later than the close of business on the 90th day nor earlier than the close of business on the 120th day prior to the first anniversary of the preceding year’s annual meeting of shareholders. For the 2011 annual meeting of shareholders, a shareholder’s notice shall be timely if delivered to our principal executive offices not later than the 90th day prior to the scheduled date of the annual meeting of shareholders or the 10th day following the day on which public announcement of the date of our annual meeting of shareholders is first made or sent by Ampio. Ampio’s by-laws also specify certain requirements as to the form and content of a shareholders’ meeting. These provisions may preclude Ampio shareholders from bringing matters before the annual meeting of shareholders or from making nominations for directors at Ampio’s annual meeting of shareholders.

Authorized but unissued shares

Ampio’s authorized but unissued shares of common stock and preferred stock are available for future issuances without shareholder approval and could be utilized for a variety of corporate purposes, including future offerings to raise additional capital, acquisitions and employee benefit plans. The existence of authorized but unissued and unreserved common stock and preferred stock could render more difficult or discourage an attempt to obtain control of Ampio by means of a proxy contest, tender offer, merger or otherwise.

Removal of directors

Ampio’s certificate of incorporation provides that a director on the board of directors may be removed from office only for cause and only by the affirmative vote of the holders of 75% or more of the shares then entitled to vote at an election of the Ampio directors.

Limitation on liability and indemnification of directors and officers

Ampio’s certificate of incorporation and by-laws provide that Ampio’s directors and officers will be indemnified by Ampio to the fullest extent authorized by Delaware law as it now exists or may in the future be amended, against all expenses and liabilities reasonably incurred in connection with their service for or on our behalf. In addition, Ampio’s certificate of incorporation provides that Ampio’s directors will not be personally liable for monetary damages to Ampio for breaches of their fiduciary duty as directors, unless they violated their duty of loyalty to Ampio or our shareholders, acted in bad faith, knowingly or intentionally violated the law, authorized unlawful payments of dividends, unlawful stock purchases or unlawful redemptions, or derived an improper personal benefit from their actions as directors. Ampio’s by-laws also permit Ampio to secure insurance on behalf of any officer, director or employee for any liability arising out of his or her actions, regardless of whether Delaware law would permit indemnification.

These provisions may discourage shareholders from bringing a lawsuit against Ampio’s directors for breach of their fiduciary duty. These provisions also may have the effect of reducing the likelihood of derivative litigation against directors and officers, even though such an action, if successful, might otherwise benefit Ampio and its shareholders. Furthermore, a shareholder’s investment may be adversely affected to the extent Ampio pays the costs of settlement and damage awards against directors and officers pursuant to these indemnification provisions. Ampio believes that these provisions, insurance and the indemnity agreements are necessary to attract and retain talented and experienced directors and officers.

There is no pending litigation or proceeding involving any of Ampio’s directors or officers where indemnification by Ampio would be required or permitted. Ampio is not aware of any threatened litigation or proceeding that might result in a claim for such indemnification. Insofar as indemnification for liabilities arising under the Securities Act of 1933 (the “Act”) may be permitted to Ampio’s directors, officers and controlling persons pursuant to the foregoing provisions, or otherwise, Ampio 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.

Registration rights

Redwood Consultants, LLC has certain “piggy-back” registration rights under which Ampio has agreed to pay the expenses of registering shares of common stock owned by Redwood on the filing of a registration statement on a suitable form. All such shares were transferred by Redwood to Constellation Asset Management LLC and Sunrise Capital LLC on or about July 14, 2010. We believe the beneficial owners of Redwood also control Constellation but have not independently verified this belief.

Securities Authorized for Issuance Under Equity Compensation Plans

At the special meeting of Ampio’s shareholders on March 1, 2010, the Ampio shareholders approved the adoption of Ampio’s stock and option award plan, under which 2,500,000 shares were reserved for future issuance under restricted stock awards, options, and other equity awards. The plan permits grants of equity awards to employees, directors and consultants. On August 15, 2010, the number of shares issuable under the plan was increased to 4,500,000 shares by consent of Ampio’s majority shareholders. The following table displays equity compensation plan information as of December 31, 2010.

Equity Compensation Plan Information


	Number of Securities to be Issued upon Exercise of Outstanding Options, Warrants and Rights (a)		Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights (b)		Number of Securities Remaining Available for Issuance under Equity Compensation Plans (Excluding Securities Reflected in Column (a)) (c)
Equity compensation plans approved by security holders		4,500,000	$	—		1,600,000
Equity compensation plans not approved by security holders		—		—		—

Total		4,500,000	$	—		1,600,000

Amendment of the Ampio Bylaws

Under the Ampio certificate of incorporation, the board of directors is expressly authorized to amend, alter, change or repeal the Ampio bylaws. The shareholders also have the ability to amend, alter, change or repeal the Ampio bylaws by the affirmative vote of a majority of the outstanding shares, except that a two-thirds vote is required for the shareholders to amend the bylaws sections related to bringing matters before an annual shareholder meeting, nominating and electing directors and filling vacancies on the board of directors, and the procedures required to amend the Ampio bylaws.

COMPARISON OF RIGHTS OF COMMON SHAREHOLDERS OF AMPIO AND COMMON

SHAREHOLDERS OF BIOSCIENCES

Ampio is incorporated under the laws of the State of Delaware and BioSciences is incorporated under the laws of the State of Colorado. If the merger is completed, BioSciences securityholders, whose rights are currently governed by the CBCA, the amended and restated articles of incorporation of BioSciences (the “BioSciences Articles”) and the bylaws of BioSciences (the “BioSciences Bylaws”), will become shareholders of Ampio, and their rights as such will be governed by the DGCL, the Ampio Certificate and the Ampio Bylaws. The material differences between the rights of holders of BioSciences common stock and the rights of holders of Ampio common stock, resulting from the differences in their governing documents, are summarized below.

The following summary does not purport to be a complete statement of the rights of holders of Ampio common stock under applicable Delaware law, the Ampio Certificate and the Ampio Bylaws, nor does the following purport to be a complete summary of the rights of the holders of BioSciences common stock under applicable Delaware law, the BioSciences Articles and the BioSciences Bylaws, or a complete description of the specific provisions referred to herein. This summary contains a list of the material differences but is not meant to be relied upon as an exhaustive list or a detailed description of the provisions discussed and is qualified in its entirety by reference to the DGCL, the CBCA and the governing corporate instruments of Ampio and BioSciences. We urge you to read those documents carefully in their entirety. Copies of the applicable governing corporate instruments of Ampio are available, without charge, to any person, including any beneficial owner to whom this information statement/prospectus is delivered, by following the instructions listed under “Where You Can Find More Information” on page 93.


	Ampio Stockholder Rights	BioSciences Stockholder Rights
Capitalization	Ampio’s authorized capital stock is described under “Description of Ampio Capital Stock.”	The total authorized shares of capital stock of BioSciences consist of 100,000,000 shares of common stock, without par value, and 50,000,000 shares of undesignated preferred stock. As of December 31, 2010, 17,975,587 shares of BioSciences common stock were issued and outstanding, of which 9,171,282 shares are Class A shares and 8,804,305 shares are Class B shares, and no preferred stock was outstanding.

Number of Directors	The Ampio Bylaws provide that the total number of Ampio directors will be not less than three and not more than fifteen, as fixed by the board of directors of Ampio from time to time. Ampio currently has five directors.	The BioSciences Bylaws provide that, the total number of BioSciences directors will be not less than three. BioSciences currently has three directors.

Election of Directors	Nominations of persons for election to the Ampio board of directors may be made at a meeting of shareholders by or at the direction of the board of directors. In addition, any stockholder may nominate persons for election to the Ampio board of directors by giving timely notice to Ampio’s Secretary. Directors will be elected at a shareholders’ meeting by a plurality of the votes of the shares present in person or represented by proxy at the meeting and entitled to vote.	Directors will be elected at a shareholders’ meeting by a plurality of the votes of the shares present in person or represented by proxy at the meeting and entitled to vote.


	Ampio Stockholder Rights	BioSciences Stockholder Rights
Removal of Directors	Any or all directors may be removed, with cause, by the affirmative vote of at least a majority of the total voting power of Ampio’s outstanding voting securities, voting together as a single class at a meeting specifically called for such purpose.	The BioSciences Bylaws provide that a director may be removed with or without cause by the holders of a majority of the shares of stock entitled to vote for the election of directors.

Vacancies on the Board of Directors	Any vacancy on the Ampio board of directors that results from an increase in the number of directors may be filled by the majority vote of the directors then in office as long as a quorum is present. Any other vacancy may be filled by a majority of the board of directors then in office, even if less than a quorum, or by a sole remaining director.	If there is a vacancy on the board of directors the remaining directors may fill the vacancy by vote of a majority of directors then in office.

Amendments to Charter Documents	Under the DGCL, a proposed amendment to a corporation’s certificate of incorporation requires approval by its board of directors and adoption by an affirmative vote of a majority of the outstanding stock entitled to vote on the amendment. The Ampio Certificate provides that the affirmative vote of the holders of at least two-thirds of the combined voting power of all of the then-outstanding shares of Ampio eligible to be cast in the election of directors is required in order to amend, alter, change or repeal the sections of the Ampio Certificate related to the limitation of liability of directors and indemnification of directors and officers, the prohibition of stockholder action by written consent, the calling of special meetings of shareholders, the election to be covered by DGCL Section 203, and the procedures required to amend the Ampio Certificate.	The BioSciences Articles provide that the corporation reserves the right to amend, alter, change or repeal any provision therein, provided that the number of authorized shares may only be increased or decreased by the affirmative vote of the holders of record of 66²/3% of all outstanding shares of BioSciences common stock.

Amendments to By-laws	Under the Ampio Certificate and Ampio Bylaws, the board of directors is expressly authorized to amend, alter, change or repeal the Ampio Bylaws. The shareholders also have the ability to amend, alter, change or repeal the Ampio Bylaws by the affirmative vote of a majority of the outstanding shares, except that a two-thirds vote is required for the shareholders to amend the bylaws sections related to bringing matters before an annual stockholder meeting, nominating and electing directors and filling vacancies on the board of directors, and the procedures required to amend the Ampio Bylaws.	The BioSciences Articles expressly authorize the board of directors to adopt, amend or repeal the BioSciences Bylaws, subject to the rights of shareholders to vote for such adoption, amendment or repeal. The BioSciences Bylaws provide that the by-laws may be altered, amended or repealed by (i) the affirmative vote of the directors holding at least a majority of votes held by all members of the board of directors present at a meeting at which a quorum is present, or (ii) the affirmative vote of at least a majority of the holders of all the issued and outstanding shares of BioSciences common stock entitled to vote generally at a meeting of shareholders, voting as a single class.


	Ampio Stockholder Rights	BioSciences Stockholder Rights
Action by Written Consent	The Ampio Certificate states that action by written consent in lieu of a meeting of the shareholders is prohibited at such time as Ampio completes an underwritten offering of its common stock.	The BioSciences Articles does not prohibit action by written consent in lieu of a meeting of the shareholders.

Notice of Stockholder Meeting/Stockholder Actions	The DGCL and the Ampio Bylaws provide that written notice of the time, place and purpose or purposes of every meeting of shareholders must be given not less than 10 days and not more than 60 days before the date of the meeting to each stockholder of record entitled to vote at the meeting. The Ampio Bylaws further provide that the only matters that may be considered and acted upon at an annual meeting of shareholders are those matters brought before the meeting: • through the notice of meeting; • by the board of directors of Ampio; or • by a stockholder of record entitled to vote at such meeting. Generally, the Ampio Bylaws require a stockholder who intends to bring matters before an annual meeting to provide advance notice of such intended action not less than 90 days nor more than 120 days prior to the anniversary date of the immediately preceding annual meeting of shareholders. The notice must contain, among other things, a brief description of the business desired to be brought before the meeting, the reason for conducting such business and any material interest of the stockholder and any person associated with the stockholder, individually or in the aggregate, in such business. The person presiding at the meeting will have the discretion to determine whether any item of business proposed by a stockholder was properly brought before such meeting.	The BioSciences By-laws require that written notice of each stockholder meeting must be given not less than 10 days nor more than 50 days before the date of the meeting to each stockholder of record entitled to vote at such meeting. The BioSciences By-laws also require that such notice state the place, date and hour of the meeting and, in the case of a special meeting, the purpose or purposes for which the meeting is called. The BioSciences By-laws are silent as to the procedure shareholders must follow in order to bring matters before an annual meeting of shareholders.


	Ampio Stockholder Rights	BioSciences Stockholder Rights
Special Stockholder Meetings	Under the Ampio Bylaws, a special meeting of the shareholders may only be called by resolution of a majority of the board of directors.	Under the BioSciences Bylaws, a special meeting of the stockholder may be called by any two members of the board of directors or the chairman of the board of directors, or upon written request signed by the holders of at least ten percent of the outstanding shares entitled to vote at a special meeting.

Stockholder Inspection Rights; Stockholder Lists	Under the DGCL, a stockholder of a corporation has the right, for any proper purpose and upon written demand under oath stating the purpose for such demand, to inspect and make copies and extracts from the corporation’s stock ledger, a list of its shareholders, and its other books and records. A proper purpose is any purpose reasonably related to such person’s interest as a stockholder.	The BioSciences Articles provide that a stockholder has the right, for any proper purpose and upon written demand under oath stating the purpose for such demand, to inspect and make copies and extracts from the corporation’s stock ledger, a list of its shareholders, and its other books and records. A proper purpose is any purpose reasonably related to such person’s interest as a stockholder.

Limitation of Personal Liability and Indemnification of Directors and Officers	The Ampio Certificate provides that a director will not be personally liable to Ampio or to its shareholders for monetary damages for a breach of fiduciary duty as a director.	The BioSciences Articles provide that a director or any person acting at the direction of the board of directors will not be personally liable to BioSciences or to its shareholders for monetary damages for a breach of fiduciary duty by such director.

Dividend Practices	Ampio’s board of directors does not have a policy of paying regular dividends and has never done so.	BioSciences does not have a policy of paying regular dividends on its common stock and has never done so.

Voting Rights with Respect to a Merger or Consolidation	Ampio is subject to the general provisions of the DGCL, which provide that the consummation of a merger or consolidation requires the approval of the board of directors of the corporation which desires to merge or consolidate and requires that the agreement and plan of merger be adopted by the affirmative vote of a majority of the stock of the corporation entitled to vote thereon at an annual or special meeting for the purpose of acting on the agreement. However, no such approval and vote are required if such corporation is the surviving corporation and: • such corporation’s certificate of incorporation is not amended; • the shareholders of the surviving corporation whose shares were outstanding immediately before the effective date of the merger will hold the same number of shares, with identical designations, preferences, limitations, and rights, immediately after; and	The BioSciences Bylaws provide that the affirmative vote of the directors holding at least a majority of votes present at a meeting at which a quorum is present be required to take any action by BioSciences board of directors. The BioSciences Articles provide that the affirmative vote of 66 ²/3% of the shares represented at a shareholders meeting and entitled to vote on the subject matter be required to approve a sale of all or substantially all of the corporation’s assets.


	Ampio Stockholder Rights	BioSciences Stockholder Rights

	• either no shares of common stock of the surviving corporation and no shares, securities or obligations convertible into such stock are to be issued or delivered under the plan of merger, or the authorized unissued shares or the treasury shares of common stock of the surviving corporation to be issued or delivered under the plan of merger do not exceed 20% of the shares of common stock of such corporation outstanding immediately prior to the effective date of the merger. Under the DGCL, a sale of all or substantially all of such corporation’s assets requires the approval of such corporation’s board of directors and the affirmative vote of a majority of the outstanding stock of the corporation entitled to vote thereon.

Right to Receive Stock Certificate	Ampio’s shareholders do not have the right to receive certificates representing the shares of the common stock of Ampio they own. To the fullest extent permitted by applicable Delaware law, shares of Ampio common stock are uncertificated and transfers of Ampio common stock are reflected by book entry.	BioSciences shareholders have the right to receive certificates representing the shares of the common stock of BioSciences they own.

WHERE YOU CAN FIND MORE INFORMATION

Ampio files annual, quarterly and current reports and other information with the SEC. Ampio’s SEC filings are available to the public over the Internet at the SEC’s web site at www.sec.gov or Ampio’s website at www.ampiopharma.com. You may also read and copy any reports, statements or other information filed by Ampio at the SEC’s public reference room at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room.

You may request a copy of Ampio’s filings with the SEC at no cost, by writing or telephoning Ampio at the following address or telephone number:

Ampio Pharmaceuticals, Inc.

Investor Relations

5445 DTC Parkway, P4

Greenwood Village, Colorado 80111

(303) 418-1000

You should rely only on the information provided in this information statement/prospectus. Ampio’s website has been provided for textual reference only.

Only one copy of this information statement/prospectus is being delivered to multiple BioSciences shareholders sharing an address unless BioSciences has received contrary instructions from one or more of the shareholders. Upon written or oral request, BioSciences will promptly deliver a separate copy of this information statement/prospectus statement to a BioSciences shareholder at a shared address to which a single copy of this information statement/prospectus has been delivered. BioSciences shareholders at a shared address who would like to receive a separate copy of this information statement/prospectus, or a separate copy of future Ampio information or proxy statements or annual reports following completion of the merger, should contact Ampio at the telephone number or mailing address provided above. In the event that you are receiving multiple copies of annual reports, information statements or proxy statements at an address to which you would like to receive a single copy, multiple BioSciences shareholders sharing an address may also contact Ampio at the above listed telephone number or mailing address to receive a single copy of annual reports, information statements and proxy statements in the future.

LEGAL MATTERS

The validity of the shares of Ampio common stock offered by this information statement/prospectus will be passed upon by Richardson & Patel, LLP, counsel to Ampio. A lawyer who is of counsel to Richardson & Patel, LLP holds options to acquire 75,000 shares of our common stock, and Richardson & Patel, LLP holds options to acquire 25,000 shares of our common stock.

EXPERTS

The Ampio Pharmaceuticals, Inc. and Subsidiaries consolidated financial statements as of December 31, 2009 and 2008 and for each of the two years in the period ended December 31, 2009 included in this information statement/ prospectus have been so included in reliance on the report of Ehrhardt Keefe Steiner & Hottman PC, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.

The DMI BioSciences Assets Sold financial statements as of April 15, 2009 and September 30, 2008 and for the periods ended April 15, 2009 and September 30, 2008 included in this information statement/ prospectus have been so included in reliance on the report of Ehrhardt Keefe Steiner & Hottman PC, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.

The DMI BioSciences, Inc. financial statements as of September 30, 2010, 2009 and 2008 and for each of the three years in the period ended September 30, 2010 included in this information statement/ prospectus have been so included in reliance on the report of Ehrhardt Keefe Steiner & Hottman PC, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.

FUTURE SHAREHOLDER PROPOSALS

Shareholder proposals submitted for inclusion in the proxy materials for the Company’s next annual meeting of shareholders must be received by the Company no later than January 25, 2011, at the Company’s principal executive offices. Under SEC rules, shareholders who intend to present a proposal for the next annual meeting of shareholders without inclusion of such proposal in the Company’s proxy materials should provide notice of such proposal to the Company no later than March 8, 2011, at the Company’s principal executive offices. All notices and shareholder proposals should be sent to: Ampio Pharmaceuticals, Inc., Attention: Corporate Secretary, 5445 DTC Parkway, P4, Greenwood Village, Colorado 80111.

MISCELLANEOUS

No person has been authorized to give any information or make any representation on behalf of Ampio or BioSciences not contained in this information statement/prospectus, and if given or made, such information or representation must not be relied upon as having been authorized. The information contained in this information statement/prospectus is accurate only as of the date of this information statement/prospectus and, with respect to material incorporated into this document by reference, the dates of such referenced material.

If you live in a jurisdiction where it is unlawful to offer to exchange or sell, or to ask for offers to exchange or buy, the securities offered by this document, or if you are a person to whom it is unlawful to direct these activities, then the offer presented by this document does not extend to you.

Annex A

AMENDMENT TO AGREEMENT AND

PLAN OF MERGER

This Amendment, dated as of December 31, 2010 (this “Amendment”), to the Agreement and Plan of Merger, dated as of September 3, 2010 (the “Merger Agreement”), by and among DMI BioSciences, Inc., a Colorado corporation (the “Company”), Ampio Pharmaceuticals, Inc., a Delaware corporation (“Parent”), Ampio Acquisition, Inc., a Colorado corporation and wholly-owned subsidiary of Parent (the “Merger Subsidiary”); and the Company’s Control Shareholders.

WHEREAS, on September 14, 2010, the Company obtained shareholder approval to adopt and approve the Merger Agreement and on or about November 8, 2010, Parent obtained the requisite shareholder consent to enter into the Merger Agreement; and

WHEREAS, because the Company determined following its meeting of shareholders that it had substantially in excess of 35 non-accredited investors, the Parent Merger Stock may be issued to the Company shareholders only upon registration of the Parent Merger Stock through the filing of a registration statement (the “Registration Statement”) with the Securities and Exchange Commission (“SEC”); and

WHEREAS, Section 9.1 of the Merger Agreement permits the parties to amend the Merger Agreement by execution of an instrument in writing signed by each of Parent, Merger Sub, the Company, and the Control Shareholders; and

WHEREAS, each of Parent, Merger Sub, the Company, and the Control Shareholders desire to amend the Merger Agreement as provided herein.

NOW, THEREFORE, in consideration of the mutual agreements specified in this Amendment, Parent, Merger Sub, the Company, and the Control Shareholders hereby agree as follows:

1. Amendment of Section 3.3(a) of the Merger Agreement. Section 3.3(a) of the Merger Agreement is amended and restated in its entirety as follows:

“(a) The Merger, this Agreement, and any other transaction contemplated by this Agreement, as well as the changes to the Agreement contemplated by the Amendment dated as of December 30, 2010 to the Agreement shall have been approved by the Board of Directors of the Company and Parent, as well as the required percentage of the Company and Parent Shareholders, subject to the proviso that the Parties acknowledge and agree that the Company shareholders’ vote held on September 14, 2010 shall be advisory and non-binding in nature, and for purposes of this Agreement shall be null and void and shall not be considered in any respect to have satisfied the Company’s obligation to secure approval of its shareholders of the Merger, this Agreement and other transactions contemplated by this Agreement. Parent hereby waives all rights, if any, that Parent has to enforce the Agreement on the basis of the September 14, 2010 vote of the Company’s shareholders. Notwithstanding any other provision of the Agreement, the Parties agree that the approval by consent of at least 66²/3% of the Company’s Shareholders shall be sufficient for approval of the Merger, this Agreement and other transactions contemplated by this Agreement. Such consent agreement shall create no legal obligation to consent to the Merger until the conditions set forth in Section 3.3(e) are satisfied.”

2. Amendment of Section 3.3 of the Merger Agreement. Section 3.3 of the Merger Agreement is amended in order to add the following provisions:

“(e) The Merger and the Closing shall occur only after (i) the Company provides a definitive information statement/prospectus to each of its shareholders in the form included by Parent in the Registration Statement to be filed with the SEC, which information statement/prospectus shall disclose that Company shareholders holding at least 66²/3% of the Company common stock have agreed to consent to the adoption of the Agreement, as amended, and to approve the Merger and the other

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transactions contemplated by the Agreement, (ii) the Merger Stock is registered on the Registration Statement, which is then declared effective by the SEC, and (iii) Company shareholders not a party to an agreement to execute a Company shareholder consent are again provided the right to exercise dissenters’ rights, regardless of whether such persons were previously given the opportunity to exercise dissenters’ rights under applicable Colorado law. The Company will use its reasonable best efforts to mail the information statement/prospectus to its shareholders within four (4) calendar days after the Registration Statement is declared effective. The Company’s Board of Directors will recommend that the Company’s shareholders adopt the Agreement and approve the Merger and the other transactions contemplated thereby, and must use its reasonable best efforts to obtain such adoption and approval from the Company’s shareholders in the requisite percentage by written consent. This obligation to use such reasonable best efforts to obtain adoption of the merger agreement and approval of the Merger and the other transactions contemplated thereby is not to be limited by the commencement, disclosure, announcement or submission of any competing transaction (whether or not it is a superior competing transaction).

(f) If Parent has not filed a Registration Statement by March 1, 2011, the Company shall have the right, beginning on March 1, 2011 and ending on June 15, 2011, to put its assets to Parent in exchange for Five Million (5,000,000) shares of Ampio common stock (the “Put Period”). In this event, the Company will not be required to donate to the capital of Parent the 3,500,000 shares of Parent common stock now owned by the Company, and other modifications to the terms of the transaction will be modified as necessary to reflect the restructuring of the transaction. If the Merger is restructured as an asset sale, the approval of Company’s shareholders will be required. During the Put Period, the Company and Parent shall negotiate in good faith to structure the Merger as an asset sale.

3. Amendment of Section 2.8 of the Merger Agreement. Section 2.8 of the Merger Agreement is amended and restated in its entirety to read as follows:

“At the Closing, no Company Rights shall remain outstanding, as (i) all “in-the-money” Company Rights shall have been extinguished in exchange for 405,066 shares of Parent Merger Stock, and (ii) all “out-of-the- money” Company Rights, being 250,850 Company stock options, shall have been exchanged for 212,693 Parent Rights, on terms as nearly equal as possible to those that such persons hold in the capacity of Company Rights holders, whereupon the all Company Rights shall thereupon be cancelled and of no further force or effect. The Company specifically represents and warrants that there are no other Company Rights or Company convertible securities issued or outstanding at the date of the Amendment, except as described above and except as are being extinguished under the Conversion Agreement. For purposes of determining which Company Rights are “in-the-money” or “out-of-the-money,” the Company and Parent Boards of Directors are hereby directed to refer to the price of Parent stock on September 3, 2010, the date immediately prior to the execution of the Agreement, at which time the last reported sale of Parent common stock occurred at a price of $1.90 per share.”

4. Amendment of Section 2.2 of the Merger Agreement. Section 2.2 of the Merger Agreement is amended to provide that the Closing shall occur not later than the second business day following the date on which the last of the conditions to closing in the Agreement, as amended, are fulfilled or waived.

5. Amendment of Section 1.1 of the Merger Agreement. Section 1.1 of the Merger Agreement is amended and restated in its entirety with respect to the definitions of “Lock-Up Agreement” and “Parent Merger Stock,” and to add a definition of “Registration Statement,” as follows:

““Lock-Up Agreement” means the form of the lock-up Agreement which the Company Shareholders and those Persons holding “in-the-money” Company Rights will be required to execute with the Company and/or the Parent before receiving the shares of Parent Merger Stock issuable at the Effective Time, which Lock-Up Agreement shall require the Company Shareholders and Persons holding “in-the-money” Company Rights to agree not to sell, pledge, hypothecate, borrow against, hedge, or otherwise transfer the economic incidents of ownership of the Parent Merger Stock received by them prior to December 31, 2011, except with respect to permitted transfers described in the Lock-Up Agreement, the form of which will be provided by Parent to the Company. Notwithstanding the foregoing, executive and non-executive officers of the Company who receive Merger Stock or Parent stock in lieu of Company Rights, and executive and non-executive officers and employees of Parent at the time of the Merger, must sign Lock-Up Agreements covering the Merger Stock, and any other Parent shares of common stock or Parent Rights owned by such persons prior to, or following, the Closing for a period through February 28, 2012.

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“Parent Merger Stock” means 8,667,905 shares of Parent Common Stock to be issued by Parent in conjunction with the Merger, which shall before distribution to the Company Shareholders be reduced by (i) 500,000 shares of Parent Merger Stock allocated by the Company to conversion of approximately $500,000 in Company indebtedness immediately prior to the Effective Time under the Conversion Agreement (and the contemporaneous extinguishment and cancellation of accrued interest and penalties or whatever kind or nature that are otherwise due under the instruments described in the Conversion Agreement), and (ii) 405,066 shares of Parent Merger Stock allocated by the Company to net issuances to Company Rights holders whose options or warrants evidence exercise prices that are “in-the-money” based on the price of the Parent Common Stock on September 3, 2010.”

“Registration Statement” means a registration statement on Form S-4 which Parent will file with the SEC in January 2011 or as soon thereafter as practicable, subject to the provisions stated in this Amendment, Section 3.3(f).

6. Amendment of Section 7.1(e) of the Merger Agreement. Section 7.1(e) of the Merger Agreement is amended to replace the reference to mailing of Company Shareholder Notice Materials by “September 4, 2010,” to “both the mailing of a definitive information statement/prospectus to the Company Shareholders and the Closing occurring before June 15, 2011.”

7. Amendment of Section 7.1(f) of the Merger Agreement. Section 7.1(f) of the Merger Agreement, which appears on the execution copy of the Merger Agreement in the last paragraph on page 45 and the first paragraph on page 46, is amended and restated in its entirety as follows:

“(g) by the Company, if consents in writing setting forth the adoption of this Agreement signed by the holders of outstanding Parent Common Stock having not less than the minimum number of votes and/or shares, as applicable, that are necessary to authorize or take such action in accordance with the DGCL shall not have been delivered to Parent prior to 5:00 p.m. Mountain Daylight Time by February 28, 2011; or”

8. Amendment of Section 7.1(g) of the Merger Agreement. Section 7.1(g) of the Merger Agreement is amended to re-letter such paragraph as Section 7,1(h) and replace the reference to “September 30, 2010” with “within a reasonable period of time, being not less than eight business days nor more than 14 business days after the date on which the definitive information statement/prospectus is mailed to the Company’s shareholders, and approval by consent of not less than 66²/3% of the Company’s shareholders shall have been obtained by the Company after the Company uses all reasonable best efforts to obtain such consent.”

9. Amendment of Section 8.2 of the Merger Agreement. Section 8.2 of the Merger Agreement is amended to replace the reference to “18 months from the Closing” as the definition of the Survival Period with “until December 31, 2011” as the definition of the Survival Period.

10. Amendment of Section 8.6(b) of the Merger Agreement. Section 8.6(b) of the Merger Agreement is amended to replace the reference to “15% of the Parent Merger Stock” with “250,000 shares of Parent Merger Stock.”

11. Amendment of Section 9.2 of the Merger Agreement. Section 9.2 of the Merger Agreement is amended to replace the references to “8400 East Crescent Parkway, Suite 600,” with “5445 DTC Parkway, P4.”

12. Amendment of Section 5.25 of the Merger Agreement. Existing Section 5.25 of the Merger Agreement is replaced in its entirety as follows:

“The Company shall take all appropriate action prior to Closing to obtain from the persons owning or holding outstanding Company securities prior to Closing a signed Lock-Up Agreement which shall contain terms consistent with the revised definition of Lock-Up Agreement in the Amendment, the form of which will be provided by Parent to the Company. The Parties agree that Parent shall be contractually obligated to

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obtain a signed Lock-Up Agreement from each Company Shareholder, Company Rights Holder, or holder of promissory notes being converted under the Conversion Agreement, before Parent (or its exchange agent) is obligated to deliver to each Company Shareholder, Company Rights Holder, or holder of promissory notes being converted under the Conversion Agreement the certificates representing Parent Merger Stock.”

13. Amendment of Section 2.11 of the Merger Agreement. Section 2.11 of the Merger Agreement is deleted in its entirety.

14. Amendment of Section 7.1(d) of the Merger Agreement. Section 7.1(d) of the Merger Agreement is deleted in its entirety.

15. Amendment of Section 2.7(f) of the Merger Agreement. Section 2.7(f) of the Merger Agreement is amended to replace the references to “shall be rounded up to the nearest whole share” with “shall receive cash in lieu of a fractional share of Parent Merger Stock. The amount of cash will be equal to the fair market value of the fractional share, which fair market value shall be determined by multiplying the relevant share fraction by the per share value of $2.30 (being the average of the December 2010 last reported sale prices of Parent Common Stock as reported by the OTC Bulletin Board). No interest will be paid or will accrue on the cash payable upon surrender of fractional certificates.”

16. Preparation of Information Statement. Parent agrees to use its reasonable best efforts to file with the SEC the preliminary information statement/prospectus within four (4) Business Days of execution of this Amendment.

17. Representations and Warranties. Each of the Company, Parent and Merger Sub represents and warrants that (i) it has the corporate power and authority to execute and deliver this Amendment, (ii) this Amendment has been duly and validly authorized by all necessary action of its Board of Directors and, with respect to the Company, the Company’s Board of Directors has unanimously approved this Amendment, and (iii) this Amendment has been duly and validly executed and delivered and, assuming due authorization and execution by the other parties hereto, constitutes its legal, valid and binding obligation enforceable against it in accordance with its terms.

18. Defined Terms; Conflict. Capitalized terms used but not defined herein shall have the meaning assigned to them in the Agreement. In the event of any conflict between the Agreement and this Amendment, this Amendment will control.

19. No Other Modification. The Merger Agreement shall not be modified by this Amendment in any respect except as expressly set forth herein.

20. Governing Law. This Amendment shall be governed by and construed in accordance with the laws of the State of Colorado, without regard to the conflicts of law rules of such state.

21. Counterparts. This Amendment may be executed in counterparts, all of which shall be considered one and the same agreement and shall become effective when counterparts have been signed by each of the parties and delivered to the other parties, it being understood that all parties need not sign the same counterpart.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their duly authorized respective officers as of the date first written above.


COMPANY:

DMI BioSciences, Inc.

By:

Name:		Bruce G. Miller

Title:		President


PARENT:

Ampio Pharmaceuticals, Inc.

By:

Name:		Donald B. Wingerter, Jr.

Title:		Chief Executive Officer


MERGER SUBSIDIARY: Ampio Acquisition, Inc.

By:

Name:		Donald B. Wingerter, Jr.

Title:		Chief Executive Officer

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“DMI BIOSCIENCES CONTROL SHAREHOLDERS” or “COMPANY CONTROL SHAREHOLDERS”:

		Bruce G. Miller


		David Bar-Or


		Raphael Bar-Or


		James Winkler


		Wannell Crook

		Genesis Investment Fund, for itself and its Affiliates:



		By:


		Print Name:


		Title:

A-6

AGREEMENT AND PLAN OF MERGER

BY AND AMONG

DMI BIOSCIENCES, INC.,

AMPIO PHARMACEUTICALS, INC.,

AMPIO ACQUISITION, INC.,

AND THE DMI BIOSCIENCES CONTROL SHAREHOLDERS

DATED AS OF SEPTEMBER 3, 2010

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AGREEMENT AND PLAN OF MERGER

THIS AGREEMENT AND PLAN OF MERGER is made and entered into as of September 3, 2010, by and among DMI BioSciences, Inc., a Colorado corporation (the “Company”), Ampio Pharmaceuticals, Inc., a Delaware corporation (“Parent”), Ampio Acquisition, Inc., a Colorado corporation and wholly-owned subsidiary of Parent (the “Merger Subsidiary”); and the Company’s Control Shareholders (as defined below). Each of the Company, Parent and Merger Subsidiary may be referred to herein as a “Party,” and collectively as the “Parties.”

RECITALS:

A. Parent, the Merger Subsidiary and the Company desire to enter this Agreement pursuant to which Parent will acquire all of the issued and outstanding stock of the Company as a result of the merger of the Merger Subsidiary with and into the Company.

B. The Boards of Directors of Parent, the Merger Subsidiary and the Company have determined that it is advisable and in the best interests of Parent, the Merger Subsidiary and the Company, and their respective shareholders, that the Merger Subsidiary be merged with and into the Company.

C. The Boards of Directors of Parent, the Merger Subsidiary and the Company, and the Special Committee of the Board of Directors of the Company has each unanimously approved this Agreement and the transactions contemplated hereby and have agreed to recommend that their respective shareholders adopt and approve this Agreement subject to, in the case of the Company, the receipt of a final executed fairness opinion from Bluestone Investment Banking Group LLC that the terms of the Merger are, from a financial point of view, fair to the Company’s shareholders (the “Fairness Opinion”).

D. The Parties desire to effect the Merger as a “reorganization” under the Internal Revenue Code of 1986, as amended (the “Code”), so that the Merger will not be taxable to the Parties or their stockholders. This Agreement constitutes a “plan of reorganization” within the meaning of Treasury Regulations Section 1.368-1(c).

In consideration of the premises, the mutual promises contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto agree as follows:

ARTICLE I

DEFINITIONS

1.1 Definitions. As used in this Agreement, the following terms have the meanings set forth below.

“1933 Act” means the Securities Act of 1933, as amended.

“1934 Act” means the Securities Exchange Act of 1934, as amended.

“Affiliate” of any particular Person means any other Person controlling, controlled by or under common control with such Person.

“Affiliated Group” means an affiliated group as defined in Section 1504 of the Code (or any analogous combined, consolidated or unitary group defined under any income Tax Law) of which the Company or Parent is or has been a member.

“Agreement” means this Agreement and Plan of Merger, together with all schedules and exhibits attached hereto.

“Assets” means all assets owned or utilized by the Company or Parent, respectively, including without limitation, Leased Real Property, Personal Property, Inventory, Accounts, goodwill, Proprietary Rights and any asset listed on the Audited Financial Statements or any subsequently delivered balance sheet of the Company or Parent.

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“Audited Financial Statements” means the December 31, 2009 audited financial statements of the Company and Parent, respectively, which shall include a presentation of such periods as is required by Regulation S-X, U.S. GAAP and the rules and regulations of the SEC, as the same may be updated from time to time. For all purposes under this Agreement, Audited Financial Statements shall include a balance sheet and the related statements of loss or operations, changes in stockholders’ equity and cash flows and any required footnotes and such other disclosure materials, in each case to the extent required to be filed under cover of a Form 8-K by Parent with the SEC within four business days after Closing of the Merger.

“Business” means the Company’s business of discovering and developing proprietary pharmaceutical drugs designed to address a range of human conditions and diseases including, without limitation, male sexual dysfunction (the “PE Drug”).

“Cancellation Agreement” means that agreement among the members of the Management Team, their Affiliates, and the Company pursuant to which any and all accrued or unpaid salaries, bonuses, compensation, vacation pay, or any other amounts owed to the Management Team or their Affiliates by the Company will be cancelled by agreement of the parties thereto.

“CBCA” means the Colorado Business Corporation Act.

“Claims” or a “Claim” mean all demands, claims, actions or causes of action, assessments, complaints, directives, citations, information requests issued by any Governmental Agency, legal proceedings, orders, notices of potential responsibility, losses, all damages of whatever nature (including, without limitation, diminution in value and lost profits), Liabilities, sanctions, costs and expenses including, without limitation, interest, penalties and attorneys’ and experts’ witness fees and disbursements.

“Closing” means, subject to the satisfaction of the conditions set forth in this Agreement and compliance with the other provisions hereof, the closing of the transaction contemplated by this Agreement.

“Closing Date” means September 17, 2010, or at such other place and time as shall be mutually agreeable to the Parties hereto.

“Code” has the meaning set forth in the Recitals. “Company” has the meaning set forth in the Preamble.

“Company Control Shareholders” means, collectively, Bruce G. Miller, David Bar-Or, Raphael Bar-Or, Wannell M. Crook, Genesis and its affiliates, and James V. Winkler.

“Company Purchase Rights” means any option, warrant or other right to acquire shares of Company Stock.

“Company Shareholder Approval” means the adoption and approval of this Agreement by the requisite vote of the Company Shareholders.

“Company Stock” means, collectively, the 9,171,282 shares of Common Stock, no par value per share, of the Company, but specifically excludes the Class B Common Stock, no par value per share, of the Company which is issued and outstanding at the date hereof, all of which Class B shares of Common Stock will be donated to the capital of the Company by the holders thereof prior to the Effective Time.

“Conversion Agreement” means the form of an agreement to be executed among the Company and any Persons (except the Management Team or their Affiliates, who shall execute the Cancellation Agreement) who or which hold evidences (or who are owed) any Company Indebtedness of any kind or nature, which agreement will provide for the conversion of all such Company Indebtedness (except that owed to the Management Team or their Affiliates, which shall be covered by the Cancellation Agreement) into a portion of the Parent Merger Stock, as negotiated by the Company with such holders of Company Indebtedness.

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“Contracts” means with respect to any Person, all agreements, contracts, commitments, franchises, covenants, authorizations, understandings, licenses, mortgages, promissory notes, deeds of trust, indentures, leases, plans or other instruments, certificates or obligations, whether written or oral, to which said Person is a party, under which said Person has or may acquire any right or has or may become subject to any obligation or by which said Person, any of said Person’s outstanding shares of stock or any of its assets is bound.

“DGCL” means the Delaware General Corporation Law.

“Donation to Capital Agreement” means that agreement by and among the Company, Parent, and the Management Team, pursuant to which (i) the Company will donate to the capital of Parent, immediately prior to the Effective Time, the 3,500,000 shares of Parent Common Stock now owned of record by the Company, and (ii) the Management Team will donate back to the capital of the Company all shares of Company Stock owned by, and all Company Purchase Rights held by or on behalf of, the Management Team.

“Effective Time” means the effective time of the Merger pursuant to the application of Section 7-90-204 of the CBCA.

“Environmental Laws” means all applicable Laws concerning public health and safety, natural resources, animal health or welfare, noise control, the pollution or protection of the environment, or the use, generation, transportation, storage, treatment, processing, disposal or release of Hazardous Substances, as the foregoing are enacted and in effect on the Closing Date, including, without limitation, the Federal Solid Waste Disposal Act, as amended, the Federal Clean Air Act, as amended, the Federal Clean Water Act, as amended, the Federal Resource Conservation and Recovery Act of 1976, as amended, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, the Toxic Substances Control Act, as amended, the Occupational Safety and Health Act, as amended, the mine Safety and Health Act, as amended, regulations of the Environmental Protection Agency, regulations of the Nuclear Regulatory Agency and counterpart regulations of any state or local department of natural resources or other environmental protection agency.

“EKSH” means Ehrhardt Keefe Steiner & Hottman PC, independent public accounting firm engaged by the Company and also engaged by Parent.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

“Escrow Agreement” means the Escrow Agreement as defined in Section 8.6(b) hereof.

“Exchange Ratio” means the number (whole and fraction thereof) equal to (x) an aggregate of 7,776,213shares of Parent Merger Stock into which the Company Stock will be automatically converted at the Effective Time (which represents the Parent Merger Stock of 8,500,000 shares, less 723,787 shares of Parent Merger Stock allocated to debt conversion and net issuances, as described below), divided by (y) the number of shares of Company Stock outstanding immediately prior to the Effective Time, which shall be 9,171,282 shares.

“FCPA” means the Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder.

“Fairness Opinion” has the meaning set forth in the Recitals.

“Financial Statements” mean the Audited Financial Statements of the Company and Parent, respectively; the unaudited interim financial statements of the Company required to be presented by Parent in the registration statement to be filed with the SEC, as well as the Form 8-K to be filed within four business days of the Closing; and the financial statements of Parent filed with the SEC in Parent’s Form 10-Qs and Form 8-Ks (to the extent such forms include audited financial statements) from and after March 2, 2010.

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“Form 8-K” means the Form 8-K which will be filed by Parent within four business days of the closing of the Merger.

“GAAP” means generally accepted accounting principles, consistently applied, in the United States.

“Governmental Agency” means any court, tribunal, administrative agency or commission, taxing authority or other governmental or regulatory authority, domestic or foreign, of competent jurisdiction, including, without limitation, agencies, departments, boards, commissions or other instrumentalities of any country or any political subdivisions thereof.

“Governmental Licenses” means all permits, licenses, franchises, orders, registrations, certificates, variances, approvals and other authorizations obtained from any Governmental Agency.

“Hazardous Substances” means any wastes, substances, radiation, or materials (whether solids, liquids or gases): (i) which are hazardous, toxic, infectious, explosive, radioactive, carcinogenic, or mutagenic; (ii) which are or become defined as “pollutants,” “contaminants,” “hazardous materials,” “hazardous wastes,” “hazardous substances,” “toxic substances,” “radioactive materials,” “solid wastes,” or other similar designations in, or otherwise subject to regulation under, any Environmental Laws; (iii) the presence of which on real property cause or threaten to cause a nuisance pursuant to applicable statutory or common law upon real property or to adjacent properties; (iv) which contain without limitation polychlorinated biphenyls (PCBs), asbestos or asbestos-containing materials, lead-based paints, urea-formaldehyde foam insulation, or petroleum or petroleum products (including, without limitation, crude oil, natural or methane gas, or any component or derivation thereof); or (v) which pose a hazard to human health, human safety, natural resources, animal health or welfare, employees, or the environment.

“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

“Indebtedness” means, with respect to any Person at any date, without duplication: (i) all obligations of such Person for borrowed money; (ii) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments (including, without limitation, any shareholder notes, deferred purchase price obligations or earn-out obligations issued or entered into in connection with any acquisition undertaken by such Person); (iii) all obligations in respect of letters of credit and bankers’ acceptances issued for the account of such Person; (iv) all obligations of such Person under any capitalized lease; (v) all liabilities and obligations pursuant to any interest rate swap or credit default swap agreements; and (vi) any accrued interest, prepayment premiums, breakage fees, penalties or similar amounts related to any of the foregoing.

“Indemnified Party” means a Party suffering any loss, damage or expense (including reasonable expert witness and attorneys’ fees) for which an Indemnifying Party is obligated to indemnify and hold such Indemnified Party harmless pursuant to the terms of this Agreement.

“Indemnifying Party” means a Party that, pursuant to the terms of this Agreement, is obligated to indemnify and hold harmless an Indemnified Party suffering any loss, damage, or expense (including reasonable expert witnesses’ and attorneys’ fees).

“Knowledge” means (i) in the case of an individual, the actual knowledge of such individual, (ii) in the case of any Person other than an individual, the actual knowledge of the Board of Directors or senior level management employees (or individuals serving in similar capacities) of such Person.

“Law” or “Laws” means any and all federal, state, local or foreign laws, statutes, ordinances, codes, rules, regulations or Orders including, without limitation, any such laws or regulations issued by any Governmental Authority.

“Leased Real Property” means all of the right, title and interest of the Company and/or Parent, as the case may be, under all leases, subleases, licenses, concessions and other agreements (written or oral),

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pursuant to which the Company or Parent holds a leasehold or sub-leasehold estate in, or is granted the right to use or occupy, any land, buildings, improvements, fixtures or other interest in real property which is used in the operation of the Company’s Business or leased by the Company or Parent.

“Leases” means those leases and subleases of the Leased Real Property.

“Liability” means, with respect to any Person, any liability, debt, loss, cost, expense, fine, penalty, obligation or damage of any kind, whether known, unknown, absolute, contingent, asserted, accrued, unaccrued, liquidated or unliquidated, matured or unmatured, or whether due or to become due.

“Lien” means any mortgage, pledge, security interest, conditional sale or other title retention agreement, encumbrance, lien, easement, option, debt, charge, claim or restriction of any kind and, in the case of securities, any put, call or similar right of a third party with respect to such securities.

“Lock-Up Agreement” means the form of the lock-up Agreement which the Company Shareholders and those Persons holding “in-the-money” Company Rights will be required to execute with the Company and Parent before receiving the shares of Parent Merger Stock issuable at the Effective Time, which lock-up agreement shall require the Company Shareholders and Persons holding “in-the-money” Company Rights to agree not to sell, pledge, hypothecate, borrow against, hedge, or otherwise transfer the economic incidents of ownership of the Parent Merger Stock received by them prior to June 15, 2011.

“Management Team” means, collectively, Bruce G. Miller, David Bar-Or, Raphael Bar-Or, Wannell M. Crook, and James V. Winkler, all of whom are present or former members of the management team of the Company.

“Material Adverse Effect” means any event, circumstance, change, occurrence or effect (collectively, “Events”) that, individually or in the aggregate, is materially adverse to the Company’s Business or the assets, liabilities, financial condition or operating results of the Company or Parent; provided, however, that no Event will be deemed (either alone or in combination) to constitute, nor will be taken into account in determining whether there has been or may be, a Material Adverse Effect to the extent that it arises out of or relates to: (i) a general deterioration in the United States economy, (ii) the outbreak or escalation of hostilities involving the United States, the declaration by the United States of a national emergency or war (whether or not declared) or the occurrence of any other calamity or crisis, including an act of terrorism, (iii) a natural disaster or any other natural occurrence beyond the control of the Company or Parent, (iv) the disclosure of the fact that Parent is the prospective acquirer of the Company, (v) the announcement or pendency of the transactions contemplated hereby, or (vi) any change in accounting requirements or principles imposed upon the Company or Parent or any change in applicable laws, rules or regulations or the interpretation thereof, (vii) any action required by this Agreement.

“Merger” means the merger of Merger Subsidiary into the Company in accordance with this Agreement and the CBCA.

“Merger Subsidiary” has the meaning set forth in the Preamble.

“Money Laundering and Related Laws” means (i) applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering statutes of all jurisdictions, including the Money Laundering Control Act of 1986, as amended, and any related or similar rules, regulations or guidelines, issued, administered or enforced by any Governmental Agency, (ii) the Bank Secrecy Act, as amended, or (iii) the Uniting and Strengthening of America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of 2001, and/or the rules and regulations promulgated under any such law, or any successor law.

“OFAC” means the Office of Foreign Assets Control of the U.S. Treasury Department.

“Order” means, with respect to any Person, any award, decision, decree, injunction, judgment, order or ruling directed to and naming such Person.

“Parent” has the meaning set forth in the Preamble.

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“Parent Merger Stock” means 8,500,000 shares of Parent Common Stock to be issued by Parent in conjunction with the Merger, which shall be reduced by (i) 500,000shares of Parent Merger Stock allocated by the Company to conversion of approximately $900,000 in Company indebtedness immediately prior to the Effective Time, and (ii) 223,787 shares of Parent Merger Stock allocated by the Company to net issuances to Company Rights holders whose options or warrants evidence exercise prices that are “in-the-money” based on a review of option and warrant exercise prices, taking into account the expected Exchange Ratio, by the Board of Directors of the Company.

“Parent Common Stock” means the common stock, par value $0.0001 per share, of Parent, the price of which is quoted on the Over the Counter Bulletin Board under the ticker symbol “AMPE”.

“Parent Shareholders’ Consent” means the consent by which Parent Shareholders holding the requisite percentage of the outstanding Parent Common Stock approve this Agreement and such other matters as are described in the Shareholder Notice Materials.

“Party” or “Parties” has the meaning set forth in the Preamble.

“PCAOB” means the Public Company Accounting Oversight Board.

“Permitted Liens” means (i) landlords’, mechanics’, materialmens’, carriers’, workmens’, contractors’ and warehousemens’ Liens arising or incurred in the ordinary course of business and for amounts which are not delinquent and are not, individually or in the aggregate, material in nature, (ii) Liens for Taxes not yet due and payable or for Taxes that are being contested in good faith, provided that a reserve for such contested Taxes is maintained by the responsible Party, and (iii) liens imposed by applicable Laws.

“Person” means any individual, sole proprietorship, partnership, joint venture, trust, unincorporated association, corporation, limited liability company, entity or governmental entity (whether federal, state, county, city or otherwise and including, without limitation, any instrumentality, division, agency or department thereof).

“Personal Property” means all tangible personal property owned or used by the Company and Parent, as the case may be, in the conduct of each entity’s business, including, without limitation, all furniture, computer hardware, fixtures that are not affixed to real property, laboratory equipment and quality control testing equipment, accessories and tools, wherever located.

“Pre-Closing Period” means the period from the date of this Agreement through the Effective Time.

“Proceeding” means any action, arbitration, audit, complaint, investigation, litigation or suit (whether civil, criminal or administrative).

“Proprietary Rights” means: (i) all inventions (whether patentable or unpatentable and whether or not reduced to practice), all improvements thereto and all foreign and domestic patents, patent applications and patent disclosures, together with all reissuances, continuations, continuations-in-part, divisionals, revisions, extensions and reexaminations thereof; (ii) all foreign and domestic trademarks, service marks, trade dress, logos and trade names and all goodwill associated therewith; (iii) all foreign and domestic copyrightable works, all foreign and domestic copyrights and all foreign and domestic applications, registrations and renewals in connection therewith; (iv) all trade secrets and confidential business information (including ideas, research and development, know-how, formulas, code books, recipes, compositions, manufacturing and production processes and techniques, technical data, designs, drawings, blue prints, specifications, customer and supplier lists, pricing and cost information and business and marketing plans and proposals); (v) all copies and tangible embodiments thereof in whatever form or medium; and (vi) websites published, controlled, maintained or the rights to which are owned or held by a Person.

“Registration Statement” means a registration statement on Form S-1 which Parent will file with the SEC in September 2010 or as soon thereafter as practicable.

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“Representatives” means a corporate or entity’s affiliates, officers, directors, employees or other agents and representatives.

“Rights” means any option, warrant or other right to acquire shares of a Person’s common or preferred stock, or any other security of that Person.

“Sarbanes-Oxley” means the Sarbanes Oxley Act of 2002, and the rules and regulations promulgated in accordance therewith, as the same may be amended from time to time.

“SEC” means the United States Securities and Exchange Commission.

“Shareholder Notice Materials” means the notice of special meeting of shareholders of the Company (together with such disclosure materials as the Company encloses therewith), by which the Company will call the Company Shareholders’ Meeting to approve the Merger and such other matters as the Company may determine to include in the Shareholder Notice Materials.

“Shareholders” mean the shareholders of the Company or Parent, as the case may be.

“Special Committee” means the special committee of the Board of Directors of the Company, consisting of Messrs. Edward Lau and James S. Kimmel.

“Statement of Merger” means the Statement of Merger satisfying the applicable requirements of the CBCA, a copy of which is attached as Exhibit A hereto.

“Subsidiary” means, with respect to any Person, any corporation, partnership, association or other business entity of which (i) if a corporation, a majority of the total voting power of shares of stock entitled (regardless of whether, at the time, stock of any other class or classes of such corporation shall have or might have voting power by reason of the happening of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof or (ii) if a partnership, association or other business entity, a majority of the partnership or other similar ownership interest thereof is at the time owned or controlled, directly or indirectly, by any Person or one or more Subsidiaries of that Person or a combination thereof.

“Surviving Corporation.” means the Company after the Merger is consummated, as the surviving corporation of the Merger.

“Tax” means any foreign, federal, state or local income, gross receipts, franchise, estimated, alternative minimum, add-on minimum, sales, use, transfer, real property gains, registration, value added, excise, natural resources, severance, stamp, occupation, premium, windfall profit, environmental, customs, duties, real property, personal property, capital stock, social security, unemployment, disability, payroll, license, employee or other withholding, or other tax, of any kind whatsoever, including any interest, penalties, fines or additions thereto or additional amounts in respect of any of the foregoing and including, without limitation, any Liability for taxes as a transferee or successor, by contract or otherwise.

“Tax Return” means any return, declaration, report, claim for refund, information return or other document (including any related or supporting schedule, statement or information) filed or required to be filed in connection with the determination, assessment or collection of any Tax.

“Transfer Agent” means Corporate Stock Transfer, Inc., located at 3200 Cherry Creek Drive South, Suite 430, Denver, Colorado 80209.

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1.2 Schedules and Exhibits. The Schedules and Exhibits attached to this Agreement are set forth below.


List of Schedules a Exhibits		Description

Schedule 3.2(g)	—	Consents

Schedule 4.2	—	Negative Covenants

Schedule 4.2(h)	—	Certain Material Contracts

Schedule 5.1	—	Jurisdictions

Schedule 5.3	—	Capitalization

Schedule 5.4	—	No Breach

Schedule 5.6	—	Certain Developments

Schedule 5.7	—	Leased Real Property

Schedule 5.8	—	Leased Personal Property

Schedule	—

Schedule 5.9	—	Contract Issues

Schedule 5.10(b)	—	Proceedings Regarding Proprietary Rights

Schedule 5.11	—	Government Licenses

Schedule 5.12	—	Proceedings

Schedule 5.13	—	Compliance with Laws

Schedule 5.19	—	Brokerage

Schedule 5.21	—	Directors and Officers

Schedule 5.23	—	Related Parties

Schedule 5.23	—	Directors, Officers, Banks

Schedule 5.25	—	Related Party Transactions

Schedule 6.1	—	Jurisdictions

Schedule 6.3