SUBSEQUENT EVENTS

9 Months Ended

Sep. 30, 2013

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS

O.   SUBSEQUENT EVENTS

Acquisition of Optimer Pharmaceuticals

On October 24, 2013, Cubist completed its acquisition of Optimer, a publicly-held biopharmaceutical company focused on commercializing innovative hospital specialty products, for cash consideration of $550.5 million, or $10.75 per share, plus one transferable CVR for each outstanding share of Optimer’s common stock, which entitles the holder to receive a cash payment of up to $5.00 per CVR upon achievement of certain sales milestones for a total maximum undiscounted potential CVR payout of $253.9 million. As a result of Cubist acquiring 100% of the outstanding shares of Optimer, Optimer became a wholly-owned subsidiary of Cubist. This transaction will be accounted for under the acquisition method of accounting for business combinations. All of the assets and liabilities of Optimer will be recorded at their respective fair values as of the acquisition date and consolidated with those of Cubist. Transaction costs will be expensed as incurred.

Given the timing of the closing of the acquisition, the purchase accounting is incomplete at this time. As such, it is not practicable for the Company to disclose: (i) the allocation of purchase price to assets acquired and liabilities assumed; (ii) certain disclosures related to contingent consideration; and (iii) pro forma revenues and earnings of the combined entity. This information will be included in the Company’s 2013 Annual Report on Form 10-K to be filed with SEC.

During the nine months ended September 30, 2013, the Company expensed $3.9 million of transaction costs in connection with Cubist’s acquisition of Optimer, which are included in selling, general and administrative expenses in the condensed consolidated statement of comprehensive income.