Humanigen (HGENQ) 10-Q 8 May 14 2014 Q1 Quarterly report Financial data

Document_and_Entity_Informatio

Document and Entity Information	3 Months Ended
	Mar. 31, 2014	6-May-14
Document and Entity Information	'	'
Entity Registrant Name	'KALOBIOS PHARMACEUTICALS INC	'
Entity Central Index Key	'0001293310	'
Document Type	'10-Q	'
Document Period End Date	31-Mar-14	'
Amendment Flag	'false	'
Current Fiscal Year End Date	'--12-31	'
Entity Voluntary Filers	'Yes	'
Entity Filer Category	'Accelerated Filer	'
Entity Common Stock, Shares Outstanding	'	32,981,396
Document Fiscal Year Focus	'2014	'
Document Fiscal Period Focus	'Q1	'

Condensed_Consolidated_Balance

Condensed Consolidated Balance Sheets (USD $)	Mar. 31, 2014	Dec. 31, 2013
In Thousands, unless otherwise specified
Current assets:	'	'
Cash and cash equivalents	$33,397	$54,220
Marketable securities	29,303	22,511
Prepaid expenses and other current assets	765	786
Restricted cash	205	205
Total current assets	63,670	77,722
Restricted cash	193	'
Property and equipment, net	210	276
Marketable securities, non-current	1,692	'
Other assets	814	706
Total assets	66,579	78,704
Current liabilities:	'	'
Accounts payable	1,634	3,197
Accrued compensation	637	1,091
Accrued research and clinical liabilities	3,691	3,309
Notes payable, short-term	3,187	3,182
Other accrued liabilities	750	603
Total current liabilities	9,899	11,382
Notes payable, long-term	6,006	6,786
Total liabilities	15,905	18,168
Commitments and contingencies (Note 7)	'	'
Stockholders' equity (deficit):	'	'
Common stock, $0.001 par value: 47,500,000 shares authorized at March 31, 2014 and December 31, 2013; 32,981,396 and 32,931,092 shares issued and outstanding at March 31,2014, and December 31, 2013, respectively	33	33
Additional paid-in capital	201,265	200,715
Accumulated other comprehensive income (loss)	-1	3
Accumulated deficit	-150,623	-140,215
Total stockholders' equity	50,674	60,536
Total liabilities and stockholders' equity	$66,579	$78,704

Condensed_Consolidated_Balance1

Condensed Consolidated Balance Sheets (Parenthetical) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Condensed Consolidated Balance Sheets	'	'
Common stock, par value	$0.00	$0.00
Common stock, shares authorized	47,500,000	47,500,000
Common stock, shares issued	32,981,396	32,931,092
Common stock, shares outstanding	32,981,396	32,931,092

Condensed_Consolidated_Stateme

Condensed Consolidated Statements of Comprehensive Loss (USD $)	3 Months Ended
In Thousands, except Share data, unless otherwise specified	Mar. 31, 2014	Mar. 31, 2013
Condensed Consolidated Statements of Comprehensive Loss	'	'
Contract revenue	'	$16
Operating expenses:	'	'
Research and development	7,690	6,320
General and administrative	2,470	2,019
Total operating expenses	10,160	8,339
Loss from operations	-10,160	-8,323
Other income (expense):	'	'
Interest expense	-260	-263
Interest and other income, net	12	12
Net loss	-10,408	-8,574
Other comprehensive income (loss):	'	'
Net unrealized gains (losses) on marketable securities	-4	'
Comprehensive loss	($10,412)	($8,574)
Basic and diluted net loss per common share (in dollars per share)	($0.32)	($0.55)
Weighted average common shares outstanding used to calculate basic and diluted net loss per common share (in shares)	32,966,471	15,607,379

Condensed_Consolidated_Stateme1

Condensed Consolidated Statements of Cash Flows (USD $)	3 Months Ended
In Thousands, unless otherwise specified	Mar. 31, 2014	Mar. 31, 2013
Operating activities:	'	'
Net loss	($10,408)	($8,574)
Adjustments to reconcile net loss to net cash used in operating activities:	'	'
Depreciation and amortization	101	42
Noncash interest expense	45	38
Amortization of premium on marketable securities	59	54
Stock based compensation expense	491	181
Changes in operating assets and liabilities:	'	'
Contract receivables	40	53
Prepaid expenses and other assets	-138	-1,025
Accounts payable	-1,563	3,329
Accrued compensation	-454	200
Accrued research and clinical liabilities	382	-2,153
Other liabilities	155	73
Deferred rent	-8	-19
Net cash used in operating activities	-11,298	-7,801
Investing activities:	'	'
Purchases of property and equipment	-35	-5
Purchase of marketable securities	-31,005	'
Proceeds from maturities of marketable securities	22,460	2,395
Changes in restricted cash	-193	'
Net cash provided by (used in) investing activities	-8,773	2,390
Financing activities:	'	'
Proceeds from issuance of common stock in initial public offering, net of underwriting costs	'	64,413
Proceeds from the exercise of stock options	59	'
Principal payments under notes payable	-811	'
Net cash provided by (used in) financing activities	-752	64,413
Net increase (decreases) in cash and cash equivalents	-20,823	59,002
Cash and cash equivalents, beginning of period	54,220	10,947
Cash and cash equivalents, end of period	33,397	69,949
Supplemental cash flow disclosure:	'	'
Cash paid for interest	219	225
Supplemental disclosure of noncash financing activities:	'	'
Conversion of preferred stock to common stock and additional paid-in capital	'	102,023
Reclassification of preferred stock warrants liability to additional paid-in capital	'	$157

Nature_of_Operations

Nature of Operations	3 Months Ended
	Mar. 31, 2014
Nature of Operations	'
Nature of Operations	'
	1. Nature of Operations
	KaloBios Pharmaceuticals, Inc. (the Company) is a biopharmaceutical company whose primary business is to develop monoclonal antibody therapeutics for diseases that represent a significant burden to society and to patients and their families. The Company’s primary clinical focus is on respiratory diseases and cancer. The Company was incorporated on March 15, 2000 in California and reincorporated as a Delaware corporation in September 2001. All of the Company’s assets are located in California.
	The Company has incurred significant losses and had an accumulated deficit of $150.6 million as of March 31, 2014. The Company has financed its operations primarily through the sale of equity securities, grants and the payments received under its agreements with Novartis Pharma AG (Novartis) and Sanofi Pasteur S.A. (Sanofi). The Company completed its initial public offering (IPO) in February 2013. To date, none of the Company’s product candidates have been approved for sale and therefore the Company has not generated any revenue from product sales. Management expects operating losses to continue for the foreseeable future. As a result, the Company will continue to require additional capital through equity offerings, debt financing and/or payments under new or existing licensing or collaboration agreements. If sufficient funds on acceptable terms are not available when needed, the Company could be required to significantly reduce its operating expenses and delay, reduce the scope of, or eliminate one or more of its development programs.

Summary_of_Significant_Account

Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2014
Summary of Significant Accounting Policies	'
Summary of Significant Accounting Policies	'
	2. Summary of Significant Accounting Policies
	Basis of Presentation
	The accompanying interim unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and on a basis consistent with the annual consolidated financial statements, and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for a fair statement of the periods presented. The December 31, 2013 Condensed Consolidated Balance Sheet was derived from the audited financial statements but does not include all disclosures required by GAAP. These interim financial results are not necessarily indicative of the results to be expected for the year ending December 31, 2014, or for any other future annual or interim period. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013.
	Use of Estimates
	The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts and disclosures reported in the financial statements and accompanying notes. Actual results could differ materially from those estimates. The Company believes judgment is involved in determining the stock-based compensation and accruals. The Company evaluates estimates and assumptions as facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ from these estimates and assumptions, and those differences could be material to the consolidated financial statements.
	Concentration of Credit Risk
	Cash, cash equivalents, and marketable securities consist of financial instruments that potentially subject the Company to a concentration of credit risk in the event of a default by the related financial institution holding the securities, to the extent of the value recorded in the balance sheet. The Company invests cash that is not required for immediate operating needs primarily in highly liquid instruments with lower credit risk. The Company has established guidelines relating to the quality, diversification, and maturities of securities to enable the Company to manage its credit risk.
	Cash, Cash Equivalents, and Marketable Securities
	The Company considers all highly liquid investments with an original maturity of 90 days or less at the time of purchase to be cash equivalents. Investments in securities with remaining maturities of less than one year, or where our intent is to use the investments to fund current operations or to make them available for current operations, are classified as short-term and available for sale. Investments in securities with remaining maturities greater than one year are classified as noncurrent and available for sale (see Note 3). Securities available for sale are carried at estimated fair value, with unrealized gains and losses reported as part of accumulated other comprehensive income (loss), a separate component of stockholders’ equity. The Company has estimated the fair value amounts by using available market information. The cost of available-for-sale securities sold is based on the specific-identification method.
	Research and Development Expenses
	Development costs incurred in the research and development of new products are expensed as incurred, including expenses that may or may not be reimbursed under research and development collaboration agreements. Research and development costs include, but are not limited to, salaries, benefits, stock-based compensation, laboratory supplies, allocated overhead, fees for professional service providers and costs associated with product development efforts, including preclinical studies and clinical trials. Research and development expenses under collaborative agreements approximate or exceed the revenue recognized under such agreements.
	The Company estimates preclinical study and clinical trial expenses based on the services performed, pursuant to contracts with research institutions and clinical research organizations that conduct and manage preclinical studies and clinical trials on its behalf. In accruing service fees, the Company estimates the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from the estimate, the Company will adjust the accrual accordingly. Payments made to third parties under these arrangements in advance of the receipt of the related services are recorded as prepaid expenses until the services are rendered.
	Stock-Based Compensation Expense
	The Company measures employee and director stock-based compensation expense for stock awards at the grant date, based on the fair value-based measurement of the award, and the expense is recorded over the related service period, generally the vesting period, net of estimated forfeitures. The Company calculates the fair value-based measurement of stock options using the Black-Scholes valuation model and the single- option method and recognizes expense using the straight-line attribution approach.
	The Company accounts for equity instruments issued to nonemployees based on their fair values on the measurement dates using the Black-Scholes option-pricing model. The fair values of the options granted to nonemployees are remeasured as they vest. As a result, the noncash charge to operations for nonemployee options with vesting is affected each reporting period by changes in the fair value of the Company’s common stock.
	Comprehensive Loss
	Comprehensive loss represents net loss adjusted for the change during the periods presented in unrealized gains and losses on available-for-sale securities less reclassification adjustments for realized gains or losses included in net loss. The unrealized gains or losses are reported on the Consolidated Statements of Comprehensive Loss.
	Net Loss Per Common Share
	Basic net loss per common share is calculated by dividing the net loss by the weighted-average number of common shares outstanding during the period, without consideration of common stock equivalents. Diluted net loss per common share is computed by dividing the net loss by the weighted-average number of common shares and common share equivalents outstanding for the period. Common stock equivalents are only included in the calculation of diluted net loss per common share when their effect is dilutive.
	The Company’s potential dilutive securities which include  unvested restricted stock, stock options, and warrants have been excluded from the computation of diluted net loss per share as the effect would be to reduce the net loss per share and be antidilutive. Therefore, the denominator used to calculate both basic and diluted net loss per common share is the same in all periods presented.
	The following shares of outstanding potentially dilutive securities have been excluded from the computations of diluted net loss per common share as the effect of including such securities would be antidilutive:
		As of March 31,
		2014	2013
	Warrants to purchase common stock	88,545	38,997
	Options to purchase common stock	2,548,314	1,050,061
		2,636,859	1,089,058

Investments

Investments	3 Months Ended
	Mar. 31, 2014
Investments	'
Investments	'
	3. Investments
	At March 31, 2014, the amortized cost and fair value of investments, with gross unrealized gains and losses, were as follows:
	(in thousands)	Amortized		Gross		Gross			Fair Value
		Cost		Unrealized		Unrealized
				Gains		Losses
	Money market funds	$	33,137	$	—	$	—		$	33,137
	Commercial paper	10,238		9		—			10,247
	Corporate debt securities	20,757		—		(10		)	20,747
	Total investments	$	64,132	$	9	$	(10	)	$	64,131
	Reported as:
	Cash and cash equivalents								$	32,739
	Marketable securities, current								29,302
	Restricted cash								398
	Marketable securities, non-current								1,692
	Total investments								$	64,131
	At December 31, 2013, the amortized cost and fair value of investments, with gross unrealized gains, were as follows:
	(in thousands)	Amortized		Gross		Gross			Fair Value
		Cost		Unrealized		Unrealized
				Gains		Losses
	Money market funds	$	53,511	$	—	$	—		$	53,511
	Federal agency securities	12,301		—		—			12,301
	Commercial paper	8,246		3		—			8,249
	Corporate debt securities	1,961		—		—			1,961
	Total investments	$	76,019	$	3	$	—		$	76,022
	Reported as:
	Cash and cash equivalents								$	53,306
	Marketable securities								22,511
	Restricted cash								205
	Total investments								$	76,022
	There were no realized gains or losses from the sale of marketable securities for the three months ended March 31, 2014 and 2013.

Fair_Value_of_Financial_Instru

Fair Value of Financial Instruments	3 Months Ended
	Mar. 31, 2014
Fair Value of Financial Instruments	'
Fair Value of Financial Instruments	'
	4. Fair Value of Financial Instruments
	Cash, accounts payable and accrued liabilities are carried at cost, which approximates fair value given their short-term nature. Marketable securities and cash equivalents are carried at fair value.
	The fair value of financial instruments reflects the amounts that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The fair value hierarchy is based on three levels of inputs that may be used to measure fair value, of which the first two are considered observable, and the third is considered unobservable, as follows:
	Level 1 — Quoted prices in active markets for identical assets or liabilities.
	Level 2 — Inputs other than those included in Level 1 that are directly or indirectly observable, such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
	Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
	The Company measures the fair value of financial assets and liabilities using the highest level of inputs that are reasonably available as of the measurement date. The following tables summarize the fair value of financial assets and liabilities (investments) that are measured at fair value and the classification by level of input within the fair value hierarchy:
		Fair Value Measurements as of
		March 31, 2014
	(in thousands)	Level 1		Level 2		Level 3		Total
	Investments:
	Money market funds	$	33,137	$	—	$	—	$	33,137
	Commercial paper	—		10,247		—		10,247
	Corporate debt securities	—		20,747		—		20,747
	Total investments	$	33,137	$	30,994	$	—	$	64,131
		Fair Value Measurements as of
		December 31, 2013
	(in thousands)	Level 1		Level 2		Level 3		Total
	Investments:
	Money market funds	$	53,511	$	—	$	—	$	53,511
	Federal agency securities	—		12,301		—		12,301
	Commercial paper	—		8,249		—		8,249
	Corporate debt securities	—		1,961		—		1,961
	Total investments	$	53,511	$	22,511	$	—	$	76,022
	The Company’s Level 2 investments include U.S. government-backed securities that are valued based upon observable inputs that may include benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data including market research publications. The average remaining maturity of the Company’s Level 2 investments as of March 31, 2014 is less than ten months and all of these investments are rated by S&P and Moody’s at AAA or AA+.
	The estimated fair value of the notes payable as of March 31, 2014, as measured using Level 3 inputs, approximates the carrying amount as presented on the condensed consolidated balance sheet.

Notes_Payable

Notes Payable	3 Months Ended
	Mar. 31, 2014
Notes Payable	'
Notes Payable	'
	5. Notes Payable
	Loan and Security Agreement
	In September 2012, the Company entered into the Agreement with MidCap Financial, providing for the borrowing of up to $15 million, of which $10 million was required to be drawn. The remaining $5 million was available to be  drawn at the option of the Company. The Agreement provides for the loan to be issued in three tranches: the first tranche of $5 million was issued in September 2012; the second tranche of $5 million was issued in December 2012; and, prior to the amendment described below, the final tranche could have been drawn at the option of the Company no later than June 2013. The loan has a monthly variable interest rate, reset each month, if applicable, as determined by adding to 600 basis points the greater of: (a) one month LIBOR or (b) 3% (the LIBOR floor). Interest on amounts outstanding are payable monthly in arrears. There is an interest only period to December 31, 2013 followed by straight-line principal payments over thirty-six months until December 31, 2016. At the time of final payment, the Company must pay an exit fee of 3% of the drawn amount. Pursuant to the Agreement, the Company provided a first priority security interest in all existing and after-acquired assets, excluding intellectual property. In addition, the terms of the Agreement provided MidCap Financial a warrant to purchase shares of the Company’s Series E convertible preferred stock (Series E Preferred) equal to 4% of the amount drawn down under the facility divided by the Series E Preferred exercise price of $12.11 per share. The warrant expired upon the completion of the Company’s IPO.
	The Company has the right to prepay all or a portion of the borrowed amounts under the Agreement; however, if the Company exercises this option, the Company must pay a prepayment fee determined by multiplying the outstanding loan amount by 5% if the prepayment occurs on or before December 31, 2014, 2% if the prepayment occurs in 2015 and 1% if the prepayment occurs in the final year. In the event of default, upon which all amounts borrowed become immediately due and payable, the Company will be subject to the prepayment fee. An event of default includes, but is not limited to, an occurrence such as a payment default, a material adverse change, insolvency, or a change of control.
	In June 2013, the Company entered into the Amendment to extend the draw down date for the final tranche of $5.0 million from June 2013 to May 2014. In addition, the final tranche was changed from an optional draw down to a required draw down. In connection with the Amendment, the Company issued a warrant to purchase up to 49,548 shares of the Company’s common stock with an exercise price of $12.11 per share. The warrant expires on the tenth anniversary of its issuance date. The warrants issued to Midcap Financial had an initial fair value of $130,000, which represent financing fees, and are included in other assets in the accompanying consolidated balance sheet and are being amortized as non-cash interest expense over the remaining term of the Agreement using the effective interest method. The Company estimated the fair values of these warrants using the Black-Scholes option-pricing model, based on the inputs for the estimated fair value of the underlying common stock at the valuation measurement date, the contractual term of the warrant, risk-free interest rates, expected dividend rates and expected volatility of the price of the underlying common stock.
	Future payments as of March 31, 2014 under the Agreement, assuming no adjustments to the variable rate of interest of 9% as of March 31, 2014, are as follows:
	(in thousands)
	Remainder of 2014	$	2,990
	2015	3,724
	2016	3,701
	Total minimum payments	10,415
	Less amount representing interest	(1,226		)
	Notes payable, gross	9,189
	Discount on notes payable	(98		)
	Accretion of the final exit fee payment	102
	Carrying value of notes payable	$	9,193

Sanofi

Sanofi	3 Months Ended
	Mar. 31, 2014
Sanofi	'
Sanofi	'
	6. Sanofi
	In January 2010, the Company and Sanofi entered into an agreement for the development and commercialization of KB001, the precursor to KB001-A, an investigational new biologic for the treatment and prevention of Pseudomonas aeruginosa (Pa) infections (the Sanofi agreement). Under the terms of the Sanofi agreement, the Company received an initial upfront non-refundable payment of $35 million and received an additional non-refundable payment of $5 million that represented a second installment of the upfront fees due to the Company under the agreement upon completion of a sublicense negotiation with a third party in August 2011. The Company may also receive development, regulatory and commercial contingent payments for a potential further $250 million, as well as royalties on eventual product sales, if any. These contingent payments do not meet the definition of milestones since they are based solely on Sanofi’s performance and therefore, the milestone method will not be applied to these payments. Sanofi is solely responsible for conducting, at its cost, the research, development, manufacture, and commercialization of the licensed products for the diagnosis, treatment and/or prevention of all human diseases and conditions caused by Pa, except that the Company retains responsibility, at the Company’s cost, for developing and promoting the products for the diagnosis, treatment and/or prevention of Pa in patients with cystic fibrosis (CF) or bronchiectasis. Sanofi has an option to obtain rights to participate in the development and promotion of KB001-A and other licensed products for the diagnosis, treatment and/or prevention of Pa in patients with CF or bronchiectasis, either outside of the U.S. or worldwide, at any time up to 90 days after the delivery by the Company to Sanofi of the final clinical study report from the Company’s Phase 2 clinical trial of KB001-A in Pa-infected patients with CF.
	The agreement will remain in effect until all payment obligations under the agreement end. Sanofi may terminate the agreement for convenience or technical failure, and either Sanofi or the Company may terminate the agreement for material breach of the agreement or technical failure by the other party. In the event Sanofi terminates the agreement for convenience or the Company terminates due to Sanofi’s material breach, worldwide rights to develop, manufacture and commercialize licensed products would revert back to the Company, and Sanofi would grant to the Company a license to allow it to develop, manufacture, and commercialize licensed products worldwide, subject to commercially reasonable financial terms to be negotiated by the parties after such termination. In the event that the Company materially breaches the agreement, Sanofi may terminate the agreement or, rather than terminate the agreement, opt to deduct any damages awarded for the Company’s breach against future contingent payments and royalties otherwise payable by Sanofi under the agreement.
	Under the terms of the Sanofi agreement, the Company may receive specified research and development funding for services performed in connection with KB001-A research and development efforts. Reimbursements received by the Company for these services are recorded as contract revenue when earned as the related services are provided.

Commitments_and_Contingencies

Commitments and Contingencies	3 Months Ended
	Mar. 31, 2014
Commitments and Contingencies	'
Commitments and Contingencies	'
	7. Commitments and Contingencies
	Contractual Obligations and Commitments
	On May 21, 2013, the Company entered into an agreement with a third party for the manufacturing of KB003 clinical supply for future clinical trials. Despite the termination of the KB003 development program in severe asthma during the first quarter of 2014, we are continuing to evaluate other potential indications for KB003. Under that agreement the third party will perform a range of related services, including process development, optimization, validation, formulation development, regulatory assistance, stability testing and related activities. The agreement will remain in effect until services are completed or until either party terminates in accordance with the agreement. Supplies of material shall be according to FDA’s current Good Manufacturing Practice (cGMP) when required. As of March 31, 2014, there was a remaining commitment for services of approximately $2.9 million with the third party which is currently expected to be incurred through 2015.
	Aside from the updated contractual commitment disclosed above, as of March 31, 2014, there were no significant and material changes to our contractual obligations from those set forth in our Annual Report on Form 10-K (File No. 001-35798), filed with the Securities and Exchange Commission (SEC) on March 13, 2014.
	Guarantees and Indemnifications
	The Company, as permitted under Delaware law and in accordance with its bylaws, has agreed to indemnify its officers and directors for certain events or occurrences, subject to certain limits, while the officer or director is or was serving at the Company’s request in such capacity. The term of the indemnification period is equal to the officer’s or director’s lifetime. The maximum amount of potential future indemnification is unlimited; however, the Company currently holds director and officer liability insurance. This insurance limits the Company’s exposure and may enable it to recover a portion of any future amounts paid.
	The Company has certain agreements with service providers with which it does business that contain indemnification provisions pursuant to which the Company typically agrees to indemnify the party against certain types of third-party claims. The Company accrues for known indemnification issues when a loss is probable and can be reasonably estimated. The Company would also accrue for estimated incurred but unidentified indemnification issues based on historical activity. As the Company has not incurred any indemnification losses to date, there were no accruals for or expenses related to indemnification issues for any period presented.

Warrants_to_Purchase_Common_St

Warrants to Purchase Common Stock	3 Months Ended
	Mar. 31, 2014
Warrants to Purchase Common Stock	'
Warrants to Purchase Common Stock	'
	8. Warrants to Purchase Common Stock
	On June 19, 2013, in connection with the Amendment to its debt agreement with MidCap Financial, the Company issued a warrant to purchase up to 49,548 shares of the Company’s common stock with an exercise price of $12.11 per share. The warrant expires in June 2023. The Company recorded the initial value of the warrants in equity and other assets in the accompanying consolidated balance sheet, with the deferred other asset to be amortized over the remaining term of the debt using the effective interest method.
	In addition, the Company has outstanding warrants to purchase an aggregate of 38,997 shares of common stock at $5.13 per share which will expire on October 31, 2015.

Stockholders_Equity

Stockholders' Equity	3 Months Ended
	Mar. 31, 2014
Stockholders' Equity	'
Stockholders' Equity	'
	9. Stockholders’ Equity
	2012 Equity Incentive Plan
	As of March 31, 2014, under the 2012 Equity Incentive Plan, the Company may grant shares, stock units, stock appreciation rights, performance cash awards and/or options to employees, directors, consultants, and other service providers. For options, the per share exercise price may not be less than the fair market value of a Company common share on the date of grant. Awards generally vest over four years and expire 10 years from the date of grant. Options generally become exercisable as they vest following the date of grant.
	A summary of stock option activity for the three months ended March 31, 2014 under all of the Company’s options plans is as follows:
	(in thousands)	Options		Weighted
				Average
				Exercise
				Price
	Outstanding at December 31, 2013	1,820,784		$	4.46
	Granted	876,500		5.37
	Exercised	(50,304	)	1.18
	Cancelled	(98,666	)	6.35
	Outstanding at March 31, 2014	2,548,314		$	4.77
	Weighted-average fair value of options granted during the period			$	3.45
	Stock-Based Compensation
	The Company recorded stock-based compensation expense in the condensed consolidated statements of comprehensive loss as follows:
		Three Months
		Ended March 31,
	(in thousands)	2014			2013
	General and administrative	$	226		$	85
	Research and development	265			96
		$	491		$	181
	At March 31, 2014, the Company had $4.7 million of total unrecognized compensation expense, net of estimated forfeitures, related to outstanding stock options that will be recognized over a weighted-average period of 3.2 years.

Summary_of_Significant_Account1

Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2014
Summary of Significant Accounting Policies	'
Basis of Presentation	'
	Basis of Presentation
	The accompanying interim unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and on a basis consistent with the annual consolidated financial statements, and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for a fair statement of the periods presented. The December 31, 2013 Condensed Consolidated Balance Sheet was derived from the audited financial statements but does not include all disclosures required by GAAP. These interim financial results are not necessarily indicative of the results to be expected for the year ending December 31, 2014, or for any other future annual or interim period. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013.
Use of Estimates	'
	Use of Estimates
	The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts and disclosures reported in the financial statements and accompanying notes. Actual results could differ materially from those estimates. The Company believes judgment is involved in determining the stock-based compensation and accruals. The Company evaluates estimates and assumptions as facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ from these estimates and assumptions, and those differences could be material to the consolidated financial statements.
Concentration of Credit Risk	'
	Concentration of Credit Risk
	Cash, cash equivalents, and marketable securities consist of financial instruments that potentially subject the Company to a concentration of credit risk in the event of a default by the related financial institution holding the securities, to the extent of the value recorded in the balance sheet. The Company invests cash that is not required for immediate operating needs primarily in highly liquid instruments with lower credit risk. The Company has established guidelines relating to the quality, diversification, and maturities of securities to enable the Company to manage its credit risk.
Cash, Cash Equivalents, and Marketable Securities	'
	Cash, Cash Equivalents, and Marketable Securities
	The Company considers all highly liquid investments with an original maturity of 90 days or less at the time of purchase to be cash equivalents. Investments in securities with remaining maturities of less than one year, or where our intent is to use the investments to fund current operations or to make them available for current operations, are classified as short-term and available for sale. Investments in securities with remaining maturities greater than one year are classified as noncurrent and available for sale (see Note 3). Securities available for sale are carried at estimated fair value, with unrealized gains and losses reported as part of accumulated other comprehensive income (loss), a separate component of stockholders’ equity. The Company has estimated the fair value amounts by using available market information. The cost of available-for-sale securities sold is based on the specific-identification method.
Research and Development Expenses	'
	Research and Development Expenses
	Development costs incurred in the research and development of new products are expensed as incurred, including expenses that may or may not be reimbursed under research and development collaboration agreements. Research and development costs include, but are not limited to, salaries, benefits, stock-based compensation, laboratory supplies, allocated overhead, fees for professional service providers and costs associated with product development efforts, including preclinical studies and clinical trials. Research and development expenses under collaborative agreements approximate or exceed the revenue recognized under such agreements.
	The Company estimates preclinical study and clinical trial expenses based on the services performed, pursuant to contracts with research institutions and clinical research organizations that conduct and manage preclinical studies and clinical trials on its behalf. In accruing service fees, the Company estimates the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from the estimate, the Company will adjust the accrual accordingly. Payments made to third parties under these arrangements in advance of the receipt of the related services are recorded as prepaid expenses until the services are rendered.
Stock-Based Compensation Expense	'
	Stock-Based Compensation Expense
	The Company measures employee and director stock-based compensation expense for stock awards at the grant date, based on the fair value-based measurement of the award, and the expense is recorded over the related service period, generally the vesting period, net of estimated forfeitures. The Company calculates the fair value-based measurement of stock options using the Black-Scholes valuation model and the single- option method and recognizes expense using the straight-line attribution approach.
	The Company accounts for equity instruments issued to nonemployees based on their fair values on the measurement dates using the Black-Scholes option-pricing model. The fair values of the options granted to nonemployees are remeasured as they vest. As a result, the noncash charge to operations for nonemployee options with vesting is affected each reporting period by changes in the fair value of the Company’s common stock.
Comprehensive Loss	'
	Comprehensive Loss
	Comprehensive loss represents net loss adjusted for the change during the periods presented in unrealized gains and losses on available-for-sale securities less reclassification adjustments for realized gains or losses included in net loss. The unrealized gains or losses are reported on the Consolidated Statements of Comprehensive Loss.
Net Loss Per Common Share	'
	Net Loss Per Common Share
	Basic net loss per common share is calculated by dividing the net loss by the weighted-average number of common shares outstanding during the period, without consideration of common stock equivalents. Diluted net loss per common share is computed by dividing the net loss by the weighted-average number of common shares and common share equivalents outstanding for the period. Common stock equivalents are only included in the calculation of diluted net loss per common share when their effect is dilutive.
	The Company’s potential dilutive securities which include  unvested restricted stock, stock options, and warrants have been excluded from the computation of diluted net loss per share as the effect would be to reduce the net loss per share and be antidilutive. Therefore, the denominator used to calculate both basic and diluted net loss per common share is the same in all periods presented.
	The following shares of outstanding potentially dilutive securities have been excluded from the computations of diluted net loss per common share as the effect of including such securities would be antidilutive:
		As of March 31,
		2014	2013
	Warrants to purchase common stock	88,545	38,997
	Options to purchase common stock	2,548,314	1,050,061
		2,636,859	1,089,058

Summary_of_Significant_Account2

Summary of Significant Accounting Policies (Tables)	3 Months Ended
	Mar. 31, 2014
Summary of Significant Accounting Policies	'
Schedule of antidilutive securities excluded from computations of diluted net loss per common share	'
		As of March 31,
		2014	2013
	Warrants to purchase common stock	88,545	38,997
	Options to purchase common stock	2,548,314	1,050,061
		2,636,859	1,089,058

Investments_Tables

Investments (Tables)	3 Months Ended
	Mar. 31, 2014
Investments	'
Schedule of amortized cost and fair value of investments, with gross unrealized gains and losses	'
	At March 31, 2014, the amortized cost and fair value of investments, with gross unrealized gains and losses, were as follows:
	(in thousands)	Amortized		Gross		Gross			Fair Value
		Cost		Unrealized		Unrealized
				Gains		Losses
	Money market funds	$	33,137	$	—	$	—		$	33,137
	Commercial paper	10,238		9		—			10,247
	Corporate debt securities	20,757		—		(10		)	20,747
	Total investments	$	64,132	$	9	$	(10	)	$	64,131
	Reported as:
	Cash and cash equivalents								$	32,739
	Marketable securities, current								29,302
	Restricted cash								398
	Marketable securities, non-current								1,692
	Total investments								$	64,131
	At December 31, 2013, the amortized cost and fair value of investments, with gross unrealized gains, were as follows:
	(in thousands)	Amortized		Gross		Gross			Fair Value
		Cost		Unrealized		Unrealized
				Gains		Losses
	Money market funds	$	53,511	$	—	$	—		$	53,511
	Federal agency securities	12,301		—		—			12,301
	Commercial paper	8,246		3		—			8,249
	Corporate debt securities	1,961		—		—			1,961
	Total investments	$	76,019	$	3	$	—		$	76,022
	Reported as:
	Cash and cash equivalents								$	53,306
	Marketable securities								22,511
	Restricted cash								205
	Total investments								$	76,022

Fair_Value_of_Financial_Instru1

Fair Value of Financial Instruments (Tables)	3 Months Ended
	Mar. 31, 2014
Fair Value of Financial Instruments	'
Schedule of fair value of financial assets and liabilities measured at fair value and classification by level of input	'
		Fair Value Measurements as of
		March 31, 2014
	(in thousands)	Level 1		Level 2		Level 3		Total
	Investments:
	Money market funds	$	33,137	$	—	$	—	$	33,137
	Commercial paper	—		10,247		—		10,247
	Corporate debt securities	—		20,747		—		20,747
	Total investments	$	33,137	$	30,994	$	—	$	64,131
		Fair Value Measurements as of
		December 31, 2013
	(in thousands)	Level 1		Level 2		Level 3		Total
	Investments:
	Money market funds	$	53,511	$	—	$	—	$	53,511
	Federal agency securities	—		12,301		—		12,301
	Commercial paper	—		8,249		—		8,249
	Corporate debt securities	—		1,961		—		1,961
	Total investments	$	53,511	$	22,511	$	—	$	76,022

Notes_Payable_Tables

Notes Payable (Tables)	3 Months Ended
	Mar. 31, 2014
Notes Payable	'
Schedule of future payments under the agreement, assuming no adjustments to the variable rate of interest	'
	Future payments as of March 31, 2014 under the Agreement, assuming no adjustments to the variable rate of interest of 9% as of March 31, 2014, are as follows:
	(in thousands)
	Remainder of 2014	$	2,990
	2015	3,724
	2016	3,701
	Total minimum payments	10,415
	Less amount representing interest	(1,226		)
	Notes payable, gross	9,189
	Discount on notes payable	(98		)
	Accretion of the final exit fee payment	102
	Carrying value of notes payable	$	9,193

Stockholders_Equity_Tables

Stockholders' Equity (Tables)	3 Months Ended
	Mar. 31, 2014
Stockholders' Equity	'
Summary of stock option activity	'
	(in thousands)	Options		Weighted
				Average
				Exercise
				Price
	Outstanding at December 31, 2013	1,820,784		$	4.46
	Granted	876,500		5.37
	Exercised	(50,304	)	1.18
	Cancelled	(98,666	)	6.35
	Outstanding at March 31, 2014	2,548,314		$	4.77
	Weighted-average fair value of options granted during the period			$	3.45
Schedule of recorded stock-based compensation expense in the condensed consolidated statements of comprehensive loss	'
		Three Months
		Ended March 31,
	(in thousands)	2014			2013
	General and administrative	$	226		$	85
	Research and development	265			96
		$	491		$	181

Nature_of_Operations_Details

Nature of Operations (Details) (USD $)	Mar. 31, 2014	Dec. 31, 2013
In Thousands, unless otherwise specified
Nature of Operations	'	'
Accumulated deficit	$150,623	$140,215

Summary_of_Significant_Account3

Summary of Significant Accounting Policies (Details) (USD $)	Mar. 31, 2014
Summary of Significant Accounting Policies	'
Issuance of warrant to purchase shares of common stock	38,997
Exercise price of warrants issued (in dollars per share)	$5.13

Summary_of_Significant_Account4

Summary of Significant Accounting Policies (Details 2)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Net loss per common share	'	'
Antidilutive securities excluded from computations of diluted net loss per common share	2,636,859	1,089,058
Warrants to purchase common stock	'	'
Net loss per common share	'	'
Antidilutive securities excluded from computations of diluted net loss per common share	88,545	38,997
Options to purchase common stock	'	'
Net loss per common share	'	'
Antidilutive securities excluded from computations of diluted net loss per common share	2,548,314	1,050,061

Investments_Details

Investments (Details) (USD $)	3 Months Ended
In Thousands, unless otherwise specified	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013
Investments	'	'	'
Amortized Cost	$64,132	'	$76,019
Gross Unrealized Gains	9	'	3
Gross Unrealized Losses	-10	'	'
Fair Value	64,131	'	76,022
Realized gains or losses recorded from the sale of marketable securities	0	0	'
Cash and cash equivalents	'	'	'
Investments	'	'	'
Fair Value	32,739	'	53,306
Marketable securities	'	'	'
Investments	'	'	'
Fair Value	29,302	'	22,511
Marketable securities, current	'	'	'
Investments	'	'	'
Fair Value	29,302	'	'
Marketable securities, non-current	'	'	'
Investments	'	'	'
Fair Value	1,692	'	'
Restricted cash	'	'	'
Investments	'	'	'
Fair Value	398	'	205
Money market funds	'	'	'
Investments	'	'	'
Amortized Cost	33,137	'	53,511
Fair Value	33,137	'	53,511
Federal agency securities	'	'	'
Investments	'	'	'
Amortized Cost	'	'	12,301
Fair Value	'	'	12,301
Commercial paper	'	'	'
Investments	'	'	'
Amortized Cost	10,238	'	8,246
Gross Unrealized Gains	9	'	3
Fair Value	10,247	'	8,249
Corporate debt securities	'	'	'
Investments	'	'	'
Amortized Cost	20,757	'	1,961
Gross Unrealized Losses	-10	'	'
Fair Value	20,747	'	1,961
Long-term investments	'	'	'
Investments	'	'	'
Fair Value	$1,692	'	'

Fair_Value_of_Financial_Instru2

Fair Value of Financial Instruments (Details) (USD $)	Mar. 31, 2014	Dec. 31, 2013
In Thousands, unless otherwise specified
Fair Value of Financial Instruments	'	'
Investments	$29,303	$22,511
Measured at fair value | Level 1	'	'
Fair Value of Financial Instruments	'	'
Investments	33,137	53,511
Measured at fair value | Level 1 | Money market funds	'	'
Fair Value of Financial Instruments	'	'
Investments	33,137	53,511
Measured at fair value | Level 2	'	'
Fair Value of Financial Instruments	'	'
Investments	30,994	22,511
Measured at fair value | Level 2 | Federal agency securities	'	'
Fair Value of Financial Instruments	'	'
Investments	'	12,301
Measured at fair value | Level 2 | Commercial paper	'	'
Fair Value of Financial Instruments	'	'
Investments	10,247	8,249
Measured at fair value | Level 2 | Corporate debt securities	'	'
Fair Value of Financial Instruments	'	'
Investments	20,747	1,961
Measured at fair value | Total	'	'
Fair Value of Financial Instruments	'	'
Investments	64,131	76,022
Measured at fair value | Total | Money market funds	'	'
Fair Value of Financial Instruments	'	'
Investments	33,137	53,511
Measured at fair value | Total | Federal agency securities	'	'
Fair Value of Financial Instruments	'	'
Investments	'	12,301
Measured at fair value | Total | Commercial paper	'	'
Fair Value of Financial Instruments	'	'
Investments	10,247	8,249
Measured at fair value | Total | Corporate debt securities	'	'
Fair Value of Financial Instruments	'	'
Investments	$20,747	$1,961

Notes_Payable_Details

Notes Payable (Details) (USD $)

Mar. 31, 2014

Sep. 30, 2012

Mar. 31, 2014

Sep. 30, 2012

Sep. 30, 2012

Mar. 31, 2014

Sep. 30, 2012

Mar. 31, 2014

Sep. 30, 2012

Mar. 31, 2014

Sep. 30, 2012

Sep. 30, 2012

Sep. 30, 2012

Sep. 30, 2012

Jun. 30, 2013

Sep. 30, 2012

Loan and Security Agreement

Loan and Security Agreement

Loan and Security Agreement

Loan and Security Agreement

Loan and Security Agreement

Loan and Security Agreement

Loan and Security Agreement

Loan and Security Agreement

Loan and Security Agreement

Loan and Security Agreement

Loan and Security Agreement

Loan and Security Agreement

Loan and Security Agreement

Loan and Security Agreement

Loan and Security Agreement

Tranche

LIBOR variable interest rate

Prepayment through December 31, 2014

Prepayment through December 31, 2014

Prepayment in 2015

Prepayment in 2015

Prepayment in final year

Prepayment in final year

Minimum

First Tranche, issued in September 2012

First Tranche, issued in September 2012

Second Tranche, issued in December 2012

Final tranche that may be drawn at option of Company no later than June 2013

Final tranche that may be drawn at option of Company no later than June 2013

Series E Convertible Preferred Stock

Notes payable

'

'

'

'

'

'

'

'

'

'

'

'

'

'

'

'

Maximum amount of borrowing under the agreement

'

$15,000,000

'

'

'

'

'

'

'

'

'

$5,000,000

'

$5,000,000

'

$5,000,000

Amount of borrowing required to be drawn

'

'

'

'

'

'

'

'

'

'

10,000,000

'

'

'

'

'

Amount of remaining borrowing capacity

'

5,000,000

'

'

'

'

'

'

'

'

'

'

'

'

'

'

Number of loan tranches

'

3

'

'

'

'

'

'

'

'

'

'

'

'

'

'

Variable rate basis

'

'

'

'one month LIBOR

'

'

'

'

'

'

'

'

'

'

'

'

Spread on variable rate (as a percent)

'

'

'

6.00%

'

'

'

'

'

'

'

'

'

'

'

'

LIBOR floor rate

'

'

'

3.00%

'

'

'

'

'

'

'

'

'

'

'

'

Straight-line principal payments period

'

'36 months

'

'

'

'

'

'

'

'

'

'

'

'

'

'

Percentage of exit fee of drawn amount

'

3.00%

'

'

'

'

'

'

'

'

'

'

'

'

'

'

Warrants issued as a percentage of amount drawn under credit facility

'

'

'

'

'

'

'

'

'

'

'

'

4.00%

'

'

'

Exercise price of warrant (in dollars per share)

$5.13

'

'

'

'

'

'

'

'

'

'

'

$12.11

'

$12.11

'

Prepayment fee percentage

'

'

'

'

'

5.00%

'

2.00%

'

1.00%

'

'

'

'

'

'

Prepayment period start date

'

'

'

'

'

'

1-Jan-14

'

1-Jan-16

'

'

'

'

'

'

'

Prepayment period end date

'

'

'

'

31-Dec-14

'

31-Dec-15

'

'

'

'

'

'

'

'

'

Tranche draw down

'

'

'

'

'

'

'

'

'

'

'

'

'

'

5,000,000

'

Debt discount related to issuance of warrants

'

'

98,000

'

'

'

'

'

'

'

'

'

'

'

'

'

Issuance of warrant to purchase shares of common stock

38,997

'

'

'

'

'

'

'

'

'

'

'

'

'

49,548

'

Warrants initial fair value

'

'

'

'

'

'

'

'

'

'

'

'

'

'

$130,000

'

Notes_Payable_Details_2

Notes Payable (Details 2) (USD $)	Mar. 31, 2014
In Thousands, unless otherwise specified
Debt obligations	'
Variable rate of interest (as a percent)	9.00%
Loan and Security Agreement	'
Debt obligations	'
Remainder of 2014	2,990
2015	3,724
2016	3,701
Total minimum payments	10,415
Less amount representing interest	-1,226
Notes payable, gross	9,189
Discount on notes payable	-98
Accretion of the final exit fee payment	102
Carrying value of notes payable	9,193

Sanofi_Details

Sanofi (Details) (Sanofi, USD $)	3 Months Ended
In Millions, unless otherwise specified	Mar. 31, 2014
Sanofi	'
Research and Development Collaboration and License Agreements	'
Initial upfront non-refundable payment	$35
Additional non-refundable payment	5
Development, regulatory and commercial contingent payments	$250
Maximum days to participate in development and promotion of products	'90 days

Commitments_and_Contingencies_

Commitments and Contingencies (Details) (USD $)	3 Months Ended
In Millions, unless otherwise specified	Mar. 31, 2014
Commitments and contingencies	'
Accruals or expenses related to indemnification issues	$0
Remaining commitment for services	$2.90

Warrants_to_Purchase_Common_St1

Warrants to Purchase Common Stock (Details) (USD $)	Mar. 31, 2014
Common stock warrant liabilities	'
Issuance of warrant to purchase shares of common stock	38,997
Exercise price of warrants issued (in dollars per share)	$5.13

Stockholders_Equity_Details

Stockholders' Equity (Details) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
		2012 Equity Incentive Plan
Stock-Based Compensation Plans	'	'
Vesting period	'	'4 years
Vesting period expiration	'	'10 years
Options	'	'
Outstanding at the beginning of the period (in shares)	1,820,784	'
Granted (in shares)	876,500	'
Exercised (in shares)	-50,304	'
Canceled (in shares)	-98,666	'
Outstanding at the end of the period (in shares)	2,548,314	'
Weighted-Average Exercise Price (Per Share)	'	'
Outstanding at the beginning of the period (in dollars per share)	$4.46	'
Granted (in dollars per share)	$5.37	'
Exercised (in dollars per share)	$1.18	'
Canceled (in dollars per share)	$6.35	'
Outstanding at the end of the period (in dollars per share)	$4.77	'
Weighted-average fair value of options granted during the period	$3.45	'

Stockholders_Equity_Details_2

Stockholders' Equity (Details 2) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Stock-based compensation expense	'	'
Stock-based compensation expense	$491,000	$181,000
Unrecognized compensation expense	4,700,000	'
Weighted-average period	'3 years 2 months 12 days	'
General and administrative	'	'
Stock-based compensation expense	'	'
Stock-based compensation expense	226,000	85,000
Research and development	'	'
Stock-based compensation expense	'	'
Stock-based compensation expense	$265,000	$96,000