Income Taxes (Tables)

12 Months Ended

Dec. 31, 2013

Components of the Company's Deferred Tax Assets (Liabilities)

The significant components of the Company’s deferred tax assets (liabilities) were as follows:


	December 31,
	2013			2012
Deferred income tax assets:
Federal U.S. net operating loss carryforward	$	36,561,195		$	35,330,167
State net operating loss carryforward		3,315,514			3,521,722
Research and development credit, net		3,785,612			2,777,899
Orphan drug credit, net		19,883,076			19,039,613
Deferred rent		5,132,458			5,218,002
Deferred revenue		8,216,695			9,379,064
Depreciation		1,438,477			1,247,772
Other		1,438,870			1,575,782

Gross deferred income tax assets		79,771,897			78,090,021
Valuation allowance		(79,376,945	)		(78,090,021	)

Net deferred income tax assets		394,952			—
Deferred income tax liabilities:
Other		(394,952	)		—

Gross deferred income tax liabilities		(394,952	)		—
Net deferred income tax asset/(liability)	$	—		$	—

Reconciliation of Reported Estimated Income Tax Benefit

The reconciliation of the reported estimated income tax benefit to the amount that would result by applying the U.S. federal statutory tax rate to the net income is as follows:


	Year Ended December 31,
	2013			2012			2011
United States federal tax at statutory rate	$	(91,293	)	$	2,926,615		$	2,350,992
State taxes (net of federal benefit)		609,476			1,460,289			1,480,185
Deferred income tax adjustments		(855,130	)		(512,375	)		—
Deferred state blended rate adjustments		(344,178	)		—			—
Research credit, net		(225,605	)		—			—
Orphan drug credit, net		(843,463	)		(4,895,671	)		(7,056,607	)
Other permanent items		2,931			7,627			4,696
Equity-based compensation		241,467			279,165			725,811
Fair value adjustment of preferred stock warrant liability		218,872			(52,743	)		(496,208	)
Change in valuation allowance		1,286,923			787,093			2,991,131

Income tax expense/(benefit)	$	—		$	—		$	—

Reconciliation of the Beginning and Ending Amount of Gross Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows:


	Year Ended December 31,
	2013		2012		2011
Beginning balance	$	1,592,357	$	1,533,986	$	1,246,025
Increases/(decreases) for current year tax positions		115,502		58,371		287,961
Increases/(decreases) for prior year tax positions		—		—		—
Decreases as a result of expiration of statute of limitations		—		—		—

Ending balance	$	1,707,859	$	1,592,357	$	1,533,986