ISSUANCE OF COMMON STOCK

4 Months Ended

Dec. 31, 2012

ISSUANCE OF COMMON STOCK [Abstract]

ISSUANCE OF COMMON STOCK

(10) ISSUANCE OF COMMON STOCK

       As of December 31, 2012, there were 52,425 shares of the Company's common stock outstanding.

ISSUANCES OF COMMON STOCK AND WARRANTS IN CONNECTION WITH THE SALE OF UNITS IN A PRIVATE PLACEMENT

During the period from May 21, 2008 through June 27, 2008, Raptor entered into a securities Purchase Agreement, as amended (the "2008 Private Placement Purchase Agreement"), with 11 investors for the private placement of units of the Company, each unit comprised of one share of Raptor's Common Stock and one warrant to purchase one half of one share of Raptor's Common Stock, at a purchase price of $2.14 per unit. Pursuant to the 2008 Private Placement Purchase Agreement, the Company sold an aggregate of 4,662 shares of common stock for aggregate gross proceeds of $10.0 million and issued to the investors warrants, exercisable for two years from the initial closing, which entitle the investors to purchase up to an aggregate of 2,331 shares of common stock of the Company. These warrants have an exercise price of either $3.22 or $3.86 per share, depending on when such warrants are exercised, if at all, were classified as equity and were valued at approximately $3.0 million (using the following Black-Scholes pricing model assumptions: risk-free interest rate 2%; expected term 2 years and annual volatility 121.45%).

In connection with the 2008 Private Placement Purchase Agreement, the Company issued warrants and a cash fee to placement agents. Placement agents were issued warrants exercisable for five years which allow the agents to purchase 490 shares of the Company’s common stock and a cash fee of $700. The placement agent warrants had an exercise price of $2.36 per share and were classified as equity (valued at approximately $960 using the following Black-Scholes pricing model assumptions: risk-free interest rate 2%; expected term 5 years and annual volatility 121.45%). Of the placement agents compensated, Limetree Capital was issued warrants to purchase 439 shares of Raptor's Common Stock and cash commission of $628. One of the members of the Company's board of directors served on the board of Limetree Capital.

      On April 29, 2009, in order to reflect current market prices, Raptor offered the holders of warrants issued in connection with the 2008 Private Placement Purchase Agreement, in exchange for such warrants, new warrants to purchase the Company’s common stock at an exercise price of $1.29 per share, to the extent such exchange of the original warrants and exercise of the new warrants, including the delivery of the exercise price, occurred on or prior to July 17, 2009. The new warrants were classified as equity and valued at approximately $2.3 million based on the following Black-Scholes pricing model assumptions: risk-free interest rate 0.55%; expected term 1 year and annual volatility 231.97%. The warrants that were not exchanged prior to or on July 17, 2009 retained their original exercise prices of $3.86 per share and original expiration date of May 21, 2010. The Company received $2,615 of proceeds from warrant exercises that resulted in the issuance of 2,032 shares of Raptor's common stock pursuant to the exchange described above.

On August 21, 2009, Raptor entered into a securities purchase agreement, pursuant to which the Company sold an aggregate of 1,738 units to the investors for aggregate gross proceeds of $2,386. The 1,738 units were comprised of an aggregate of 1,738 shares of common stock and warrants to purchase up to 869 shares of the Company’s common stock.  The warrants were valued at $1.0 million (using the following Black-Scholes pricing model assumptions: risk-free interest rate 1.11%; expected term 2 years and annual volatility 240.29%) and classified in equity at issuance. The warrants were exercisable for two years from the closing and have an exercise price of either $2.57 until the first anniversary of issuance or $3.22 per share after the first anniversary of issuance.

In connection with the August 2009 private placement, the Company issued warrants to purchase 130 shares of the Company’s common stock with an exercise price of $1.50 per share and a cash fee of $59 to Limetree Capital as its sole placement agent. The warrants are exercisable for five years and were valued at approximately $171 using the following Black-Scholes pricing model assumptions: risk-free interest rate 2.58%; expected term 5 years and annual volatility 240.29%.

2009 MERGER AND NASDAQ LISTING

On September 29, 2009, the Company, formerly known as TorreyPines Therapeutics, Inc. ("TorreyPines") and Raptor Pharmaceutical Corp. ("RPC") completed a reverse merger.  The Company changed its name to "Raptor Pharmaceutical Corp." and commenced trading on September 30, 2009 on the NASDAQ Capital Market under the ticker symbol "RPTP".  Effective February 29, 2012, the Company's common stock commenced trading on the NASDAQ Global Market.  In connection with the merger, the Company assumed all of the TorreyPines stock options and warrants outstanding at the time of the merger.  The warrants are exercisable at $80.86 per share and expire on various dates through September 2015.

In connection with the exchange of shares in the merger, immediately after the effective time of such merger, RPC and the Company's stockholders owned 95% and 5% of the outstanding shares of the combined company, respectively. RPC stockholders received (as of immediately prior to such merger) 17,881 shares of the combined company's common stock in exchange for the 76,703 shares of RPC's common stock outstanding immediately prior to the closing of the merger. On September 29, 2009, immediately prior to the effective time of such merger, the Company's board of directors, with the consent of RPC's board of directors, acted to effect a reverse stock split of 1-for-17. Due to the reverse stock split implemented by the Company, the 15,999 shares of the Company's common stock outstanding immediately prior to the closing of the merger became 941 shares of the combined Company's common stock.

There were a number of factors that RPC's board of directors considered in approving the 2009 Merger. The primary reason for RPC's board of directors' decision to merge with TorreyPines was the benefit anticipated from the additional liquidity expected from having a NASDAQ trading market on which the combined company's common stock could be listed, in addition to having access to an expanded pipeline of product candidates across a wider spectrum of diseases and markets.

The liquidity benefit is the primary factor behind the goodwill recognized in the transaction (see below). The goodwill is expected to be fully deductible for tax purposes. Below is a breakdown of the assets acquired and liabilities assumed in the merger described herein (in millions):

Asset Allocation	Value
Cash and equivalents	$	0.58
Other current assets		0.10
Accrued liabilities		(0.68	)
Intangible assets:
In-process research and development		0.90
Licenses		0.24
Total identifiable assets		1.14
Goodwill		3.28
Total net assets acquired	$	4.42

ISSUANCES OF COMMON STOCK AND WARRANTS IN CONNECTION WITH THE SALE OF UNITS IN A REGISTERED DIRECT OFFERING

On December 17, 2009, the Company entered into a placement agent agreement (the "2009 Placement Agent Agreement"), pursuant to a registered direct offering (the "Direct Offering") of up to 3,748 units (the "Units"), consisting of (i) 3,748 shares of the Company's common stock, (ii) warrants to purchase an aggregate of up to 1,874 shares of the Company's common stock (the "Series A Warrants"), and (iii) warrants to purchase an aggregate of up to 1,874 shares of the Company's common stock  (the "Series B Warrants," and collectively with the Series A Warrants, the "Investor Warrants").  Gross proceeds from sale of the Units totaled $7.5 million (for net proceeds of $6.2 million after commissions and expenses).

The Series A Warrants were exercisable during the period beginning one hundred eighty (180) days after the date of issue and ending on the fifth (5th) anniversary of the date of issue. The Series B Warrants were exercisable during the period beginning one hundred eighty (180) days after the date of issue and ending on the eighteen (18) month anniversary of the date of issue.  The Investor Warrants have a per share exercise price of $2.45.  At issuance, the Series A Warrants were valued at $1.3 million (using the following Black-Scholes pricing model assumptions: risk-free interest rate 2.23%; expected term 5 years and annual volatility 49.28%) and the Series B Warrants were valued at $0.5 million (using the following Black-Scholes pricing model assumptions: risk-free interest rate 0.56%; expected term 18 months and annual volatility 49.28%). Based on the underlying terms of the Investor Warrants and Placement Agent Warrants, these warrants are classified as a liability, as discussed further below in Note 11.   

The 2009 Placement Agent received a placement fee r of $512 in cash and warrants to purchase up to an aggregate of 75 shares of the Company's common stock at $2.50 per share (valued at approximately $52 using the following Black-Scholes pricing model assumptions: risk-free interest rate 2.23%; expected term 5 years and annual volatility 49.28%) . The warrants issued to the placement agent has the same terms and conditions as the Investor Warrants except that the exercise price is $2.50 per share, and the expiration date is five years from the effective date of the registration statement for the Direct Offering.

ISSUANCES OF COMMON STOCK IN CONNECTION WITH AN EQUITY LINE

On April 16, 2010, the Company signed a purchase agreement with Lincoln Park Capital Fund, LLC ("LPC"), together with a registration rights agreement, whereby LPC agreed to purchase up to $15.0 million of the Company's common stock over a 25 month period. The purchase price of the shares issued to LPC under the purchase agreement is based on the prevailing market prices of the Company's shares at the time of sale without any fixed discount. The Company controlled the timing and amount of any sales of shares to LPC. LPC did not have the right or the obligation to purchase any shares of the Company's common stock on any business day that the purchase price of the Company's common stock was below $1.50 per share.

In consideration for entering into the purchase agreement, the Company issued to LPC 145 shares of common stock valued at $247 (recorded as deferred offering costs on the Company's consolidated balance sheet and amortized over the usage of the equity line) as a commitment fee and was required to issue up to an additional 218 shares of its common stock pro rata as LPC purchased up to $15.0 million of the Company's common stock over the 25-month agreement period. Since inception of this agreement, the Company sold 4,186 shares to LPC at a weighted-average price of $2.78 and paid commitment fees to LPC in the form of 169 shares (in addition to the 145 shares issued as the initial commitment fee), valued at $581.

2010 PRIVATE PLACEMENT

In August 2010, the Company entered into a securities purchase agreement for the private placement (the "2010 Private Placement") of the Company's common stock and warrants to purchase its common stock, at a purchase price of $3.075 per unit, with each unit comprised of one share of common stock and a warrant to purchase one share of common stock. 

The Company sold an aggregate of 4,898 units, comprised of 4,898 shares of common stock and warrants to purchase up to 4,898 shares of its common stock for gross proceeds of approximately $15.1 million. Each warrant, exercisable for 5 years from August 12, 2010, has an exercise price of $3.075 per share. The warrants issued to investors were initially valued at approximately $7.8 million (using the following Black-Scholes pricing model assumptions: risk-free interest rate 1.74%; expected term 5 years and annual volatility 85.14%). The placement agent was paid a cash commission of $979 and issued warrants to purchase 98 shares of the Company's common stock, which were classified as equity and valued at approximately $0.2 million (based upon the same Black-Scholes inputs as the investor warrants).  Based on the underlying terms, these warrants are classified as a liability, as discussed further below in Note 11.   

2011 FOLLOW-ON PUBLIC OFFERING

On September 13, 2011, the Company closed an underwritten public offering of shares of the Company's common stock at a price to the public of $4.00 per share. The shares sold in the offering included 10.0 million shares of common stock plus an additional 1.5 million shares of common stock pursuant to the exercise by the underwriters of the over-allotment option the Company granted to them. Gross proceeds to the Company in the offering (including in connection with the sale of the shares of common stock pursuant to the exercise of the over-allotment option) totaled $46.0 million, before underwriting discounts and commissions. The offering resulted in net proceeds to the Company of approximately $42.8 million after deduction of underwriting discounts of 6% and other offering expenses paid by the Company.

ISSUANCES OF COMMON STOCK IN CONNECTION WITH AN AT-THE-MARKET COMMON STOCK SALES PROGRAM

On April 30, 2012, the Company entered into an "At-the-Market" ("ATM") Sales Agreement, with Cowen and Company, LLC ("Cowen"), under which the Company may, at its discretion, sell its common stock with a sales value of up to a maximum of $40 million through ATM sales on the NASDAQ Stock Market. Cowen acts as sole sales agent for any sales made under the ATM for a 3% commission on gross proceeds. The common stock is being sold at prevailing market prices at the time of the sale of common stock, and, as a result, prices may vary.

Sales in the ATM offering are being made pursuant to the prospectus supplement dated April 30, 2012, as amended by Amendment No. 1 dated June 28, 2012, which supplements the Company's prospectus dated February 3, 2012, filed as part of the shelf registration statement that was declared effective by the SEC on February 3, 2012.  Through December 31, 2012, the Company sold 2,660 shares under the ATM at a weighted-average selling price of $5.20 per share for net proceeds of approximately $13.3 million.