Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2013

Fair Value Hierarchy for Financial Assets and Liabilities Measured on Recurring Basis

The following tables represent the Company’s fair value hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2013 and December 31, 2012:

	As of December 31, 2013
	Level 1		Level 2		Level 3		Total
Liabilities:
Accrued warrant liability	$	—	$	—	$	1,241,311	$	1,241,311
Compensatory stock options not yet issued (1)		—		—		309,450		309,450
Total liabilities	$	—	$	—	$	1,550,761	$	1,550,761
	As of December 31, 2012
	Level 1		Level 2		Level 3		Total
Liabilities:
Accrued warrant liability	$	—	$	—	$	4,105,659	$	4,105,659
Total liabilities	$	—	$	—	$	4,105,659	$	4,105,659

(1) Included in accrued expenses in the accompanying consolidated balance sheets.

Schedule of Share-Based Payment Award Warrant Liability Valuation Assumptions

The following are the assumptions used to measure the accrued warrant liability at December 31, 2013 and 2012, which were determined in a manner consistent with that described for grants of options to purchase common stock as set forth in Note 2, “Summary of Significant Accounting Policies”:

	December 31, 2013			December 31, 2012
Stock Price	$	1.17		$	1.33
Exercise Price	$	1.60 - 5.00		$	1.60 - 5.00
Term in years		0.59 - 1.91			1.09 - 2.41
Volatility		42.52 - 76.03	%		82.75 - 95.91	%
Annual rate of quarterly dividends		0	%		0	%
Discount rate- bond equivalent yield		.08 - .36	%		.17 - .29	%

Assumptions Used to Measure the Compensatory Stock Options

The following are the assumptions used to measure the compensatory stock options not yet issued at December 31, 2013:

	December 31, 2013
Stock price	$	0.72
Term in years		5
Volatility		75.68	%
Annual rate of quarterly dividends		0	%
Discount rate – bond equivalent yield		1.52	%

Summary of Changes in Fair Value of Company's Level 3 Fair Value Measurements

The following table sets forth a summary of changes in the fair value of the Company’s Level 3 fair value measurements for the year ended December 31, 2013 and 2012:

	Year Ended December 31, 2013
	Accrued Warrant Liability			Compensatory Stock Options Issued After Year End
Beginning Balance	$	4,105,659		$	—
Total (gains) or losses, realized and unrealized, included in earnings (1)(2)		(2,864,348	)		—
Estimates and other changes in fair value		—			309,450
Balance, December 31, 2013	$	1,241,311		$	309,450
	Year Ended December 31, 2012
	Accrued Warrant Liability			Compensatory Stock Options Issued After Year End
Beginning Balance	$	7,285,959		$	378,750
Total (gains) or losses, realized and unrealized, included in earnings (1)(2)		(7,701,981	)		51,823
Issuances		4,521,681			—
Settlements		—			(430,573	)
Balance, December 31, 2012	$	4,105,659		$	—

(1) Unrealized gains or losses related to the accrued warrant liability were included as change in value of accrued warrant liability. There were no realized gains or losses for the years ended December 31, 2013 and 2012.

(2) Expenses recorded for compensatory stock options not yet issued are included in research and development expense and general and administrative expense.

Summary of Unobservable Inputs in Fair Value Measurements

The following table summarizes the unobservable inputs into the fair value measurements:

	December 31, 2013
Description	Fair Value		Valuation Technique	Unobservable Input	Range
Compensatory stock options not yet issued	$	309,450	Black-scholes pricing model	Expected term		5
				Quantity of options		696,000
Accrued warrant liability		1,241,311	Black-scholes pricing model	Expected term		0.59 - 1.91
	$	1,550,761

Warrant [Member]

Assumptions Used to Measure the Compensatory Stock Options

Certain warrants issued during the 2012 offering contain provisions that could require the Company to settle the warrants in cash and, accordingly, were originally recorded as a liability in the amount of $4,521,681 determined by the Black-Scholes valuation model with the following assumptions:

Stock price	$	2.48
Exercise price	$	3.00
Term in years		2.51
Volatility		79.70	%
Annual rate of quarterly dividends		—
Discount rate- bond equivalent yield		0.35	%

Certain warrants issued in June 2011 contain provisions that could require the Company to settle the warrants in cash, and accordingly, were originally recorded as a liability in the amount of $2,525,175 determined by the Black-Scholes valuation model with the following assumptions:

Stock price	$	4.45
Exercise price	$	5.00
Term in years		2.50
Volatility		69.36	%
Annual rate of quarterly dividends		—
Discount rate- bond equivalent yield		0.53	%