Subsequent Events	3 Months Ended
Mar. 31, 2013
Subsequent Events
Subsequent Events	9. Subsequent Events The following events occurred subsequent to March 31, 2013. Reverse Stock Split On April 1, 2013 the Company effected a 1-for-1.3953 reverse stock split of its common stock. All references in these financial statements and accompanying notes to shares of common stock or per share amounts related to common stock are reflective of the reverse split for all periods reported. Hercules Warrant In connection with the loan and security agreement entered into with Hercules on March 29, 2013, the Company issued to Hercules, effective April 1, 2013, a warrant to purchase shares of the Company’s common stock initially equal to $500,000 (increasing to $625,000 if it draws down on the term loan facility) divided by 80% of the IPO per share price of the common stock, at an exercise price equal to 80% of the price per share of the common stock in the IPO. The warrant will expire upon the five-year anniversary of the IPO. Based on the $8.00 price per share to the public in the Company’s April 2013 IPO, the warrant issued to Hercules is exercisable for 78,125 shares of common stock with a per share exercise price of $6.40. Initial Public Offering On April 16, 2013, the Company completed the IPO of its common stock pursuant to a registration statement on Form S-1. In the IPO, the Company sold an aggregate of 8,000,000 shares of common stock under the registration statement at a public offering price of $8.00 per share. Net proceeds were approximately $57.5 million, after deducting underwriting discounts and commissions and estimated offering expenses payable by the Company. Upon the closing of the IPO, all outstanding shares of the Company’s Series A and B preferred stock were converted into 10,625,847 shares of common stock. Additionally, 2,228,925 shares of common stock were issued upon the conversion of all outstanding principal and interest accrued on the Notes and 549,301 shares of common stock were issued upon the automatic net exercise of outstanding warrants to purchase capital stock. Merger Agreement On May 27, 2013, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Zeneca, Inc., a Delaware corporation (“Parent”), and KAFA Acquisition Corp., a Delaware corporation and a wholly owned subsidiary of Parent (“Merger Subsidiary”). The Merger Agreement provides for the merger of Merger Subsidiary with and into the Company, with the Company surviving the Merger as a wholly owned subsidiary of Parent (the “Merger”). Parent and Merger Subsidiary are affiliates of AstraZeneca PLC. The Merger Agreement provides that each outstanding share of the Company’s common stock will be converted into the right to receive $12.70 in cash, without interest, less any applicable withholding taxes (the “Cash Consideration”), plus one contractual contingent value right (“CVR”), which represents the right to receive contingent payments of up to approximately $4.70 in cash in the aggregate, without interest, less any applicable withholding taxes, if specified milestones are achieved within agreed upon time periods (the “Contingent Consideration”), subject to and in accordance with the terms and conditions of the Contingent Value Rights Agreement. The Company expects this transaction to close, subject to customary conditions, in the third quarter of 2013. Some of the customary conditions to closing include obtaining the approval of the holders of a majority of the outstanding shares of the Company’s common stock and the expiration or early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. The Merger Agreement provides for customary provisions that prohibit the Company from soliciting other offers. In connection with the entry into the Merger Agreement, one of the Company’s directors and its Chief Executive Officer, Gerald L. Wisler, one of the Company’s executive officers, Michael H. Davidson, M.D., certain investment funds affiliated with Sofinnova Capital VI FCPR, and certain investment funds affiliated with New Enterprise Associates (collectively, the “Voting Stockholders”), entered into voting agreements with Parent (the “Voting Agreements”). Pursuant to the Voting Agreements, the Voting Stockholders agreed to vote their shares of the Company’s common stock in favor of the Merger. The Voting Stockholders together own more than 50% of the outstanding shares of common stock. Accordingly, unless the Voting Agreements are terminated, the Voting Stockholders will vote their shares of common stock in favor of the Merger Agreement and the Merger will be approved. The Company intends to file with the SEC and mail to its stockholders a proxy statement and other relevant materials in connection with the proposed transaction. The material terms of the Merger Agreement, including the conditions thereto, will be described in a subsequent filing on Form 8-K.

9. Subsequent Events

The following events occurred subsequent to March 31, 2013.

Reverse Stock Split

On April 1, 2013 the Company effected a 1-for-1.3953 reverse stock split of its common stock. All references in these financial statements and accompanying notes to shares of common stock or per share amounts related to common stock are reflective of the reverse split for all periods reported.

Hercules Warrant

In connection with the loan and security agreement entered into with Hercules on March 29, 2013, the Company issued to Hercules, effective April 1, 2013, a warrant to purchase shares of the Company’s common stock initially equal to $500,000 (increasing to $625,000 if it draws down on the term loan facility) divided by 80% of the IPO per share price of the common stock, at an exercise price equal to 80% of the price per share of the common stock in the IPO. The warrant will expire upon the five-year anniversary of the IPO. Based on the $8.00 price per share to the public in the Company’s April 2013 IPO, the warrant issued to Hercules is exercisable for 78,125 shares of common stock with a per share exercise price of $6.40.

Initial Public Offering

On April 16, 2013, the Company completed the IPO of its common stock pursuant to a registration statement on Form S-1. In the IPO, the Company sold an aggregate of 8,000,000 shares of common stock under the registration statement at a public offering price of $8.00 per share. Net proceeds were approximately $57.5 million, after deducting underwriting discounts and commissions and estimated offering expenses payable by the Company. Upon the closing of the IPO, all outstanding shares of the Company’s Series A and B preferred stock were converted into 10,625,847 shares of common stock. Additionally, 2,228,925 shares of common stock were issued upon the conversion of all outstanding principal and interest accrued on the Notes and 549,301 shares of common stock were issued upon the automatic net exercise of outstanding warrants to purchase capital stock.

Merger Agreement

On May 27, 2013, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Zeneca, Inc., a Delaware corporation (“Parent”), and KAFA Acquisition Corp., a Delaware corporation and a wholly owned subsidiary of Parent (“Merger Subsidiary”). The Merger Agreement provides for the merger of Merger Subsidiary with and into the Company, with the Company surviving the Merger as a wholly owned subsidiary of Parent (the “Merger”). Parent and Merger Subsidiary are affiliates of AstraZeneca PLC.

The Merger Agreement provides that each outstanding share of the Company’s common stock will be converted into the right to receive $12.70 in cash, without interest, less any applicable withholding taxes (the “Cash Consideration”), plus one contractual contingent value right (“CVR”), which represents the right to receive contingent payments of up to approximately $4.70 in cash in the aggregate, without interest, less any applicable withholding taxes, if specified milestones are achieved within agreed upon time periods (the “Contingent Consideration”), subject to and in accordance with the terms and conditions of the Contingent Value Rights Agreement. The Company expects this transaction to close, subject to customary conditions, in the third quarter of 2013. Some of the customary conditions to closing include obtaining the approval of the holders of a majority of the outstanding shares of the Company’s common stock and the expiration or early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

The Merger Agreement provides for customary provisions that prohibit the Company from soliciting other offers.

In connection with the entry into the Merger Agreement, one of the Company’s directors and its Chief Executive Officer, Gerald L. Wisler, one of the Company’s executive officers, Michael H. Davidson, M.D., certain investment funds affiliated with Sofinnova Capital VI FCPR, and certain investment funds affiliated with New Enterprise Associates (collectively, the “Voting Stockholders”), entered into voting agreements with Parent (the “Voting Agreements”). Pursuant to the Voting Agreements, the Voting Stockholders agreed to vote their shares of the Company’s common stock in favor of the Merger. The Voting Stockholders together own more than 50% of the outstanding shares of common stock. Accordingly, unless the Voting Agreements are terminated, the Voting Stockholders will vote their shares of common stock in favor of the Merger Agreement and the Merger will be approved.

The Company intends to file with the SEC and mail to its stockholders a proxy statement and other relevant materials in connection with the proposed transaction. The material terms of the Merger Agreement, including the conditions thereto, will be described in a subsequent filing on Form 8-K.