The Merger, which closed on February 24, 2021, was accounted for as a reverse asset acquisition pursuant to Topic 805, Business Combinations, as substantially all of its fair value was concentrated in cash, working capital, and IPR&D. As the IPR&D assets had no alternative future use, the fair value attributable to these assets was recorded as acquired IPR&D in the Company’s condensed consolidated statements of operations for the three months ended March 31, 2021.

The estimated fair value of total consideration given was $103.4 million based on 5,173,772 shares of Sunesis common stock and 10,248 shares of Sunesis convertible preferred stock (or 292,799 Sunesis common shares on an as-converted basis) outstanding immediately prior to the merger date. The number of outstanding common stock and preferred stock on an as-converted basis was multiplied by the Sunesis closing common stock price of $18.62 on the date of the merger, plus transaction costs of $1.6 million, to determine the estimated fair value of total consideration.

The allocation of the purchase price is as follows (in thousands):


Net assets acquired (1)	$	18,956
Acquired IPR&D (2)		84,478
Purchase price	$	103,434

(1) Net assets acquired (in thousands):


Cash and cash equivalents	$	17,143
Prepaid expenses and other assets		3,768
Accounts payable and accrued liabilities		(1,955	)
Net assets acquired	$	18,956

(2) Represents the research and development projects of Sunesis which were in-process, but not yet completed. Current accounting standards require that the fair value of IPR&D projects acquired in an asset acquisition with no alternative future use be allocated a portion of the consideration transferred and charged to expense on the acquisition date. The acquired IPR&D assets did not have outputs or employees.