NATURE OF OPERATIONS

12 Months Ended

Dec. 31, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

NOTE 1: NATURE OF OPERATIONS

Atossa Genetics Inc. (the “Company”) was incorporated on April 30, 2009 in the State of Delaware. The Company was formed to develop and market medical devices, laboratory tests and therapeutics to address breast health conditions. The Company’s fiscal year ends on December 31.

In December 2011, the Company established the National Reference Laboratory for Breast Health, Inc., or NRLBH, as a wholly-owned subsidiary. NRLBH was the Company’s CLIA-certified laboratory which performed the Company’s nipple aspirate fluid, or NAF, cytology test on NAF specimens including those collected with the Company’s Mammary Aspiration Specimen Cytology Test (MASCT) System. The current version of the MASCT System is called the ForeCYTE Breast Aspirator. The NRLBH provides other test services, including the pharmacogenomics test. On December 16, 2015 we announced the sale of approximately 81% of the capital stock of the NRLBH to the NRL Investment Group, LLC, with the Company retaining a 19% ownership through preferred stock. The Company received $50,000 at the time of the sale and the right to receive, commencing December 2016, monthly earn-out payments equal to 6% of gross revenue of NRLBH up to $10,000,000, and the right to sell its preferred stock after four years for the greater of $4,000,000 or fair market value. The Company has elected to recognize any subsequent gain from the earn-out payments as they are determined realizable. The Earn-out Payments are payable to us each calendar month commencing with December 2016 and is 6% of NRL gross sales calculated in accordance with U.S. Generally Accepted Accounting Principles.

As a result of the sale of our laboratory business, we are now focusing our business on our pharmaceutical programs. Our key objective is to advance our pharmaceutical candidates through Phase 2 trials and then evaluate further development through partners or independently. A Phase 2 study of fulvestrant administered via our patented intraductal microcatheters was initiated in March 2016 and a Phase 2 study of AfTG is planned to begin enrollment following resolution of our dispute with Besins Healthcare Luxembourg SARL (“Besins”).