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Acquisition (Notes) | 6 Months Ended
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Jun. 30, 2014
Business Combinations [Abstract] |
Mergers, Acquisitions and Dispositions Disclosures [Text Block] | Acquisition On May 8, 2014 (the “Closing”), NeoStem closed its acquisition of CSC (the “CSC Acquisition”), pursuant to the terms of the Agreement and Plan of Merger, dated as of April 11, 2014 (the “Merger Agreement”), by and among NeoStem, CSC, NBS Acquisition Sub I, Inc., a Delaware corporation and a wholly-owned subsidiary of NeoStem (“Subco”), NBS Acquisition Sub II, LLC, a Delaware limited liability company and a wholly-owned subsidiary of NeoStem (“Subco II”), and Jason Livingston, solely in his capacity as CSC stockholder representative (together with his permitted successors, the “CSC Representative”). At Closing, Fortis Advisors LLC succeeded to the duties of the CSC Representative pursuant to the Merger Agreement. Pursuant to the Merger Agreement, on the Closing Date, (1) Subco was merged with and into CSC (the “First Merger”) and (2) CSC was then merged with and into Subco II (the “Second Merger”, and collectively with the First Merger, the “Mergers”), with Subco II surviving the Mergers as a wholly-owned subsidiary of NeoStem. At Closing, Subco II changed its legal name to NeoStem Oncology, LLC. CSC is a biopharmaceutical company with deep expertise in stem cell biology that is engaged in the development of therapies using a patient’s own, i.e., autologous, cells. Its development efforts are primarily directed at immunotherapies for cancer. Its most advanced program is an immunotherapy, NBS20, also referred to as DC/TC (dendritic cell/tumor cell), which uses patients’ own tumor cells to maximize the ability of their immune system to identify and eliminate the cancer initiating cells that are capable of reconstituting or developing new tumors (i.e., “cancer stem cells” or “replicating cells”). The current focus of that program is the treatment of metastatic melanoma. As a result of encouraging Phase 2 data, the Company expects to initiate a Phase 3 clinical trial later in 2014, for which it has received Special Protocol Assessment (“SPA”) and Fast Track designation, as well as Orphan Drug designation. Aggregate Merger Consideration Pursuant to the terms of the Merger Agreement, all shares of CSC common stock (“CSC Common Stock”) and CSC preferred stock (“CSC Preferred Stock”, and collectively with the CSC Common Stock, the “CSC Capital Stock”) outstanding immediately prior to the Closing, and all outstanding unexercised options to purchase CSC Common Stock (“CSC Options”) (treated as if a net exercise had occurred), were canceled and converted into the right to receive, in the aggregate (and giving effect to the liquidation preferences accorded to the CSC Preferred Stock): (1)An aggregate of 5,329,593 shares of NeoStem common stock (subject to payment of nominal cash in lieu of fractional shares) (the “Closing Merger Consideration”). (2)if payable after the Closing, certain payments in an amount of up to $90.0 million in the aggregate, payable in shares of NeoStem Common Stock or cash, in NeoStem’s sole discretion, in the event of the successful completion of certain milestone events in connection with the CSC business being acquired by NeoStem (the “Milestone Payments”, and together with the Closing Merger Consideration, the “Merger Consideration”). The fair value of the net assets acquired in the CSC Acquisition was $20.3 million. The fair value of the consideration paid by NeoStem was valued at $35.3 million, resulting in the recognition of goodwill in the amount of $15.0 million. The consideration paid was comprised of equity issued and milestone payments. The fair value of the equity issued by NeoStem was valued at $24.5 million. The fair value of the milestone payments was valued at $10.8 million, and is contingent on the achievement of certain milestones associated with the future development of the acquired programs. Such contingent consideration has been classified as a liability and will be subject to remeasurement. The preliminary fair value of assets acquired and liabilities assumed on May 8, 2014 is as follows (in thousands):
Cash and cash equivalents | $ | 51.2 |
Accounts receivable trade, net | 45.1 |
Prepaids and other current assets | 19.2 |
Property, plant and equipment, net | 1,040.9 |
Other assets | 201.0 |
Goodwill | 14,961.9 |
In-Process R&D | 35,790.0 |
Accounts payable | (333.1 | )
Accrued liabilities | (2,014.1 | )
Deferred tax liability | (14,509.3 | )
| $ | 35,252.8 |
The total cost of the acquisition, which is still preliminary, has been allocated to the assets acquired and the liabilities assumed based upon their estimated fair values at the date of the acquisition. The final allocation is pending the receipt of a third-party valuation and the completion of the Company’s internal review, which is expected during fiscal 2014. For the period since the acquisition (May 9, 2014 to June 30, 2014), NeoStem recorded $0.01 million in revenues and a net loss of approximately $2.3 million or $0.07 basic and diluted loss per share attributable to CSC. Pro Forma Financial Information The following supplemental table presents unaudited consolidated pro forma financial information as if the closing of the acquisition of CSC had occurred on January 1, 2013 (in thousands, except per share amounts):
| Three Months Ended June 30, 2014 |  | Six Months Ended June 30, 2014
| (As Reported) |  | (Proforma) |  | (As Reported) |  | (Proforma)
Revenues | $ | 4,489 |  |  | $ | 4,982 |  |  | $ | 8,545 |  |  | $ | 9,255 |
Net loss | $ | (12,770 | ) |  | $ | (13,574 | ) |  | $ | (26,600 | ) |  | $ | (29,097 | )
Net loss attributable to NBS | $ | (12,605 | ) |  | $ | (13,409 | ) |  | $ | (26,287 | ) |  | $ | (28,784 | )
Net loss per share attributable to NBS | $ | (0.40 | ) |  | $ | (0.36 | ) |  | $ | (0.88 | ) |  | $ | (0.82 | )
| Three Months Ended June 30, 2013 |  | Six Months Ended June 30, 2013
| (As Reported) |  | (Proforma) |  | (As Reported) |  | (Proforma)
Revenues | $ | 4,359 |  |  | $ | 4,596 |  |  | $ | 6,883 |  |  | $ | 7,282 |
Net loss | $ | (8,626 | ) |  | $ | (9,830 | ) |  | $ | (17,490 | ) |  | $ | (19,963 | )
Net loss attributable to NBS | $ | (8,575 | ) |  | $ | (9,780 | ) |  | $ | (17,376 | ) |  | $ | (19,849 | )
Net loss per share attributable to NBS | $ | (0.46 | ) |  | $ | (0.41 | ) |  | $ | (0.99 | ) |  | $ | (0.87 | )
The unaudited supplemental pro forma financial information should not be considered indicative of the results that would have occurred if the acquisition of CSC had been consummated on January 1, 2013, nor are they indicative of future results.

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- Definition The entire disclosure for business combinations, including leverage buyout transactions (as applicable), and divestitures. This may include a description of a business combination or divestiture (or series of individually immaterial business combinations or divestitures) completed during the period, including background, timing, and assets and liabilities recognized and reclassified or sold. This element does not include fixed asset sales and plant closings. + References No definition available. + Details
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