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NeuVaxTM Acquisition | 12 Months Ended
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Dec. 31, 2013
Business Combinations [Abstract] |
NeuVaxTM Acquisition | NeuVax™ Acquisition On April 13, 2011, the company acquired its late stage product candidate, NeuVax, through a merger acquisition of Apthera, Inc., a Delaware corporation (“Apthera”), with Apthera surviving as a wholly-owned subsidiary of the company. At the closing of the merger, the company issued to Apthera’s stockholders approximately 5.0 million shares of common stock of the company and agreed to pay to the former Apthera shareholders future contingent consideration of up to $32 million based on the achievement of specified development and commercial milestones relating to the NeuVax, of which $2 million had been paid as of December 31, 2013. The remaining $30 million of contingent consideration is payable, at the election of the company, in cash or in additional shares of common stock valued for this purpose at the market price of the company common stock when the contingent consideration becomes payable. The goodwill associated with the acquisition is not deductible for tax purposes. The purchase price consideration and allocation of purchase price were as follows (in thousands):
Calculation of allocable purchase price: |  |  |  |
Fair value of shares issued at closing including escrowed shares expected to be released |  | $ | 6,367 |  |  | (i)
Estimated value of earn-out |  | 6,460 |  |  |
Total allocable purchase price |  | $ | 12,827 |  |  |
Allocation of purchase price: |  |  |  |
Cash |  | $ | 168 |  |  |
Prepaid expenses and other current assets |  | 14 |  |  |
Equipment and furnishings |  | 11 |  |  |
Goodwill |  | 5,898 |  |  |
In-process research and development |  | 12,864 |  |  |
Accounts payable |  | (931 | ) |  |
Accrued expenses and other current liabilities |  | (143 | ) |  |
Notes payable |  | (1 | ) |  |
Deferred tax liability, non-current |  | (5,053 | ) |  |
|  | $ | 12,827 |  |  |
(i) | The value of the company’s common stock was based upon a per share value of $1.28, the closing price of the company’s common stock as of the close of business on April 13, 2011.
The company recorded the estimated fair value of the contingent consideration at $6.5 million based on the expected probability of achieving the specified development and commercial milestones relating to the company’s NeuVax product candidate and then applying a discount rate, based on a corporate debt interest rate index publicly issued, to the expected future payments. The expected timing and probability of achieving each milestone and the discount rates applied are reviewed quarterly using the most current information to measure the contingent consideration as of the reporting date. On January 19, 2012, the first milestone was achieved, and the company issued into escrow in favor of the former Apthera shareholders $1,000,000, or 1,315,849 shares, of common stock in payment of the related contingent consideration. The number of shares was based on the $0.76 closing price of the company’s common stock as reported on The NASDAQ Capital Market on January 18, 2012, the day prior to achievement of the first milestone. In September 2012, the escrowed shares were released to the former Apthera shareholders from escrow, and the company paid to the former Apthera shareholders cash of $35,016, representing an interest factor of ten percent 10% per annum on the $1,000,000 amount of the milestone payment from February 10, 2012 through the day immediately prior to the release of the escrowed shares. During the year ended December 31, 2012, the company recorded additional other expense of $579,000, related to the change in the fair value of the escrowed shares up to the date of release from escrow. In June 2013, the company achieved another milestone under the contingent value rights agreement, resulting in a $1,247,000 milestone payment that was paid by issuing 492,988 shares of our common stock. The increase in the fair value of the contingent liability during the years ended December 31, 2013 and 2012, was $926,000 and $2,370,000, respectively, and the decrease in the fair value of the contingent liability during the year ended December 31, 2011 was $109,000. The changes in the fair value of the contingent liability are included in other income (expense) in the accompanying consolidated statements of expenses. The fair value of the contingent liability at December 31, 2013 and 2012 was $6,821,000 and $7,142,000, of which $0 and $935,000 is recorded as a current contingent liability, respectively. The following presents the unaudited, pro forma net loss and pro forma net loss per common share of the company for year ended December 31, 2011 as if the company’s acquisition of Apthera occurred as of January 1, 2011 (in thousands expect for per share data):
| For the Year Ended December 31, 2011
Net loss from continuing operations | $ | (4,700 | )
Net loss from discontinued operations | $ | (8,078 | )
Net loss per common share, continuing operations | $ | (0.12 | )
Net loss per common share, discontinued operations | $ | (0.21 | )
Net loss per common share | $ | (0.34 | )

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -SubTopic 30 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=7488404&loc=d3e6996-128479 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -SubTopic 10 -Section 50 -Paragraph 7 -URI http://asc.fasb.org/extlink&oid=7659399&loc=d3e1524-128463 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=7659399&loc=d3e1383-128463 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -SubTopic 30 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=7488404&loc=d3e7000-128479 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 141R -Paragraph F4 -Subparagraph e -Appendix F Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -SubTopic 20 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=6910749&loc=d3e4934-128472 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 141 -Paragraph 51, 52 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. 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This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Emerging Issues Task Force (EITF) -Number 88-16 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. 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