Liquidity Risks and Management's Plans	3 Months Ended
Mar. 31, 2013
Liquidity Risks and Management's Plans (MBT to update) [Abstract]
Liquidity Risks and Management's Plans (MBT to update)	Note 2 – Liquidity Risks and Management's Plans We have incurred substantial losses since inception, due to investments in research and development, manufacturing and potential commercialization activities, and we expect to continue to incur substantial losses over the next several years. Historically, we have funded our business operations through various sources, including public and private securities offerings, draw downs under a series of Committed Equity Financing Facilities (CEFFs) and a previous at-the-market program that we entered into in December 2011 with Lazard Capital Markets, capital equipment and debt facilities, and strategic alliances. As of March 31, 2013, we had cash and cash equivalents of $26.4 million and approximately $7 million of accounts payable and accrued expenses and $10 million of long-term debt under the Deerfield Facility (discussed below). As a result of the delay in commercial availability of SURFAXIN drug product from the second quarter potentially to the fourth quarter of 2013, we have assessed and made adjustments to our strategic plan. Since we expect a moderate delay of up to six months, we intend to maintain our U.S. commercial and medical affairs capabilities and plan to continue investments in activities necessary to potentially advance our AEROSURF program and initiate a planned phase 2 clinical program in the fourth quarter of 2013. We also have adopted a plan intended to conserve cash resources by pacing certain other investments in our operations and commercial and development programs through the fourth quarter of 2013. To execute this business strategy and fund our operations, we will require significant additional infusions of capital until such time as the net revenues from SURFAXIN and AFECTAIR, from potential strategic alliance and collaboration arrangements and from other sources are sufficient to offset our cash flow requirements. Such infusions of capital could come from potential strategic alliances and collaboration arrangements, debt financings, public offerings and other similar transactions. Before additional financings, if any, including under our ATM Program (discussed below) and Deerfield Facility, we anticipate that we have sufficient cash available to support our operations and debt service obligations into the fourth quarter of 2013. Since a second $20 million payment under the Deerfield Facility will not be disbursed until we complete the first commercial sale of SURFAXIN drug product, our access to funds under the Deerfield Facility is also delayed, potentially until the fourth quarter of 2013. If we are unable to complete the first commercial sale of SURFAXIN drug product on or before December 31, 2013, our ability to access funds under the Deerfield Facility, will expire. Even if we succeed and both SURFAXIN drug product and AFECTAIR are introduced commercially as planned, given the time required to secure formulary acceptance of SURFAXIN at our target hospitals and acceptance of a new product, we expect our revenues from SURFAXIN and AFECTAIR to be modest in the first 12-18 months and then increase over time as our products gain hospital acceptance. Our investments in our operations, debt service and development programs are expected to outpace the rate at which we may generate revenues for several years. The accompanying interim unaudited financial statements have been prepared assuming that we will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. As a result of our cash position as of December 31, 2012, the audit opinion we received from our independent auditors for the year ended December 31, 2012 contains a notation related to our ability to continue as a going concern. Whether we can continue as a going concern is dependent upon our ability to raise additional capital, fund our research and development and commercial programs, and meet our obligations on a timely basis. If we are unable to secure sufficient additional capital, through strategic partnerships and collaborative arrangements, debt and/ or equity financings and other similar transactions, we will likely not have sufficient cash flows and liquidity to fund our business operations, which could significantly limit our ability to continue as a going concern. In that event, we may be forced to further limit our development and commercial programs and consider other means of creating value for our stockholders, such as licensing the development and/or commercialization of products that we consider valuable and might otherwise plan to develop ourselves. If we are unable to secure the necessary capital, we may be forced to curtail all activities and, ultimately, cease operations. Even if we are able to raise additional capital, such transactions may only be available on unattractive terms, or could result in significant dilution of stockholders' interests and, in such event, the market price of our common stock may decline. Our March 31, 2013 financial statements do not include any adjustments relating to recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should we be unable to continue in existence. To secure the necessary capital, we would prefer to enter into strategic alliances or collaboration agreements that could provide development and commercial expertise as well as financial resources (potentially in the form of upfront payments, milestone payments, commercialization royalties and a sharing of research and development expenses) and, if approved, the introduction of our approved products in various markets outside the U.S. We also expect that we may secure $20 million additional capital under our Deerfield Facility, if we are able to complete the first commercial sale of SURFAXIN drug product on or before December 31, 2013. We also will consider equity public offerings. Through our ATM Program, we have the ability to sell up to $25 million of common stock at such times and in such amounts that we deem appropriate. Under our 2010 CEFF with Kingsbridge Capital Ltd. (Kingsbridge), we may sell to Kingsbridge up to approximately 1.1 million shares of our common stock, which based on the closing market price of our common stock on May 1, 2013 ($1.68), could result in proceeds to us of approximately $1.7 million. However, we may not meet the conditions to gain access to the funds available under the Deerfield Facility, the ATM Program can be cancelled at any time by either us or Stifel, and our 2010 CEFF will expire June 11, 2013. We also plan to consider other public and private equity offerings as well as financing transactions, such as secured equipment financing facilities or other similar transactions. Our future capital requirements depend upon many factors, primarily the success of our efforts to (i) execute the commercial introduction of SURFAXIN and AFECTAIR in the U.S., as planned; (ii) advance the AEROSURF development program to initiation of the planned phase 2 clinical program in the fourth quarter of 2013; and (iii) secure one or more strategic alliances or other collaboration arrangements to support the development and, if approved, the commercial introduction of SURFAXIN, SURFAXIN LS, AFECTAIR and AEROSURF in markets outside the U.S. We believe that our ability to enter into a significant strategic alliance will likely improve if we remain on track to initiate both the commercial sale of SURFAXIN and our AEROSURF phase 2 clinical program in the fourth quarter of 2013. There can be no assurance, however, that our efforts will be successful, or that we will be able to obtain additional capital to support our activities when needed on acceptable terms, if at all. As of March 31, 2013, 100 million shares of common stock were authorized under our Amended and Restated Certificate of Incorporation, as amended, and approximately 37.6 million shares of common stock were available for issuance and not otherwise reserved. In February 2013, we entered into a loan facility (Deerfield Facility) with affiliates of Deerfield Management Company, L.P. (Deerfield), pursuant to which Deerfield agreed to loan to us up to $30 million on a secured basis. Deerfield advanced $10 million upon execution of the agreement and agreed to advance an additional $20 million upon the first commercial sale of SURFAXIN drug product, provided that such sale occurs on or before December 31, 2013. In connection with the first disbursement, we issued to Deerfield a warrant to purchase approximately 2.3 million shares at an exercise price of $2.81. See, Note 6 – "Long-term Debt – Loan Facility with Deerfield." Under the Deerfield Facility, interest accrues at a rate of 8.75% and is payable quarterly in cash. Principal is payable beginning on the fourth anniversary of the loan and is subject to further deferral as provided in the Deerfield Facility. For the quarter ended March 31, 2013, we accrued and paid interest in the amount of $0.1 million. Also in February 2013, we entered into an At-the-Market Equity Offering Sales Agreement with Stifel, Nicolaus & Company, Incorporated (Stifel), pursuant to which Stifel, as our exclusive agent, at our discretion and at such times that we determine from time to time, may sell over a three-year period up to a maximum of $25 million of our common stock through an at-the-market program (ATM Program). We are not required to sell any shares at any time during the term of the ATM Program. We will pay Stifel a commission for each transaction equal to 3% of the gross proceeds. See, Note 4 – "Stockholders' Equity – At-the-Market Program (ATM Program)". In addition, as of March 31, 2013, we had outstanding warrants to purchase approximately 10.3 million shares of our common stock at various prices, exercisable on different dates into 2019. Of these warrants, approximately 4.9 million are February 2011 five-year warrants, which contain anti-dilution provisions that adjust the exercise price if we issue any common stock, securities convertible into common stock, or other securities (subject to certain exceptions) at a value below the then-existing exercise price of the warrants. These warrants were issued at an exercise price of $3.20 per share, which was adjusted downward to $2.80 per share following a public offering conducted at an offering price of $2.80 per share in March 2012. As of March 31, 2013, 4,948,750 of the February 2011 five-year warrants were outstanding. The holders of the Deerfield Warrants may exercise the warrants either for cash or on a cashless basis. In addition, in lieu of paying cash, the holders may elect to reduce the principal amount of the Deerfield loan to satisfy the exercise price of the warrants upon exercise. Although we believe that, in the future, we will secure additional capital from the exercise of at least a portion of our outstanding warrants, there can be no assurance that the market price of our common stock will equal or exceed price levels that make exercise of outstanding warrants likely or that holders of outstanding warrants will choose to exercise any or all of their warrants prior to the warrant expiration date. Moreover, if our outstanding warrants are exercised, such exercises likely will be at a discount to the then-market value of our common stock and have a dilutive effect on the value of our shares of common stock at the time of exercise. Although we currently believe that we will be able to execute our revised strategic plan and accomplish our objectives, there can be no assurance that we will be successful. We require additional capital to satisfy our debt obligations, sustain operations, and complete the development and support the commercial introduction of our products, including SURFAXIN and AFECTAIR and, if approved, AEROSURF and potentially SURFAXIN LS. There can be no assurance that we will be successful in securing the needed capital, through strategic alliances, collaboration arrangements, financings, debt arrangements and other transactions. Failure to secure the necessary additional capital would have a material adverse effect on our business, financial condition and results of operations.

Note 2 – Liquidity Risks and Management's Plans

We have incurred substantial losses since inception, due to investments in research and development, manufacturing and potential commercialization activities, and we expect to continue to incur substantial losses over the next several years. Historically, we have funded our business operations through various sources, including public and private securities offerings, draw downs under a series of Committed Equity Financing Facilities (CEFFs) and a previous at-the-market program that we entered into in December 2011 with Lazard Capital Markets, capital equipment and debt facilities, and strategic alliances.

As of March 31, 2013, we had cash and cash equivalents of $26.4 million and approximately $7 million of accounts payable and accrued expenses and $10 million of long-term debt under the Deerfield Facility (discussed below). As a result of the delay in commercial availability of SURFAXIN drug product from the second quarter potentially to the fourth quarter of 2013, we have assessed and made adjustments to our strategic plan. Since we expect a moderate delay of up to six months, we intend to maintain our U.S. commercial and medical affairs capabilities and plan to continue investments in activities necessary to potentially advance our AEROSURF program and initiate a planned phase 2 clinical program in the fourth quarter of 2013. We also have adopted a plan intended to conserve cash resources by pacing certain other investments in our operations and commercial and development programs through the fourth quarter of 2013. To execute this business strategy and fund our operations, we will require significant additional infusions of capital until such time as the net revenues from SURFAXIN and AFECTAIR, from potential strategic alliance and collaboration arrangements and from other sources are sufficient to offset our cash flow requirements. Such infusions of capital could come from potential strategic alliances and collaboration arrangements, debt financings, public offerings and other similar transactions. Before additional financings, if any, including under our ATM Program (discussed below) and Deerfield Facility, we anticipate that we have sufficient cash available to support our operations and debt service obligations into the fourth quarter of 2013. Since a second $20 million payment under the Deerfield Facility will not be disbursed until we complete the first commercial sale of SURFAXIN drug product, our access to funds under the Deerfield Facility is also delayed, potentially until the fourth quarter of 2013. If we are unable to complete the first commercial sale of SURFAXIN drug product on or before December 31, 2013, our ability to access funds under the Deerfield Facility, will expire. Even if we succeed and both SURFAXIN drug product and AFECTAIR are introduced commercially as planned, given the time required to secure formulary acceptance of SURFAXIN at our target hospitals and acceptance of a new product, we expect our revenues from SURFAXIN and AFECTAIR to be modest in the first 12-18 months and then increase over time as our products gain hospital acceptance. Our investments in our operations, debt service and development programs are expected to outpace the rate at which we may generate revenues for several years.

The accompanying interim unaudited financial statements have been prepared assuming that we will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. As a result of our cash position as of December 31, 2012, the audit opinion we received from our independent auditors for the year ended December 31, 2012 contains a notation related to our ability to continue as a going concern. Whether we can continue as a going concern is dependent upon our ability to raise additional capital, fund our research and development and commercial programs, and meet our obligations on a timely basis. If we are unable to secure sufficient additional capital, through strategic partnerships and collaborative arrangements, debt and/ or equity financings and other similar transactions, we will likely not have sufficient cash flows and liquidity to fund our business operations, which could significantly limit our ability to continue as a going concern. In that event, we may be forced to further limit our development and commercial programs and consider other means of creating value for our stockholders, such as licensing the development and/or commercialization of products that we consider valuable and might otherwise plan to develop ourselves. If we are unable to secure the necessary capital, we may be forced to curtail all activities and, ultimately, cease operations. Even if we are able to raise additional capital, such transactions may only be available on unattractive terms, or could result in significant dilution of stockholders' interests and, in such event, the market price of our common stock may decline. Our March 31, 2013 financial statements do not include any adjustments relating to recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should we be unable to continue in existence.

To secure the necessary capital, we would prefer to enter into strategic alliances or collaboration agreements that could provide development and commercial expertise as well as financial resources (potentially in the form of upfront payments, milestone payments, commercialization royalties and a sharing of research and development expenses) and, if approved, the introduction of our approved products in various markets outside the U.S. We also expect that we may secure $20 million additional capital under our Deerfield Facility, if we are able to complete the first commercial sale of SURFAXIN drug product on or before December 31, 2013. We also will consider equity public offerings. Through our ATM Program, we have the ability to sell up to $25 million of common stock at such times and in such amounts that we deem appropriate. Under our 2010 CEFF with Kingsbridge Capital Ltd. (Kingsbridge), we may sell to Kingsbridge up to approximately 1.1 million shares of our common stock, which based on the closing market price of our common stock on May 1, 2013 ($1.68), could result in proceeds to us of approximately $1.7 million. However, we may not meet the conditions to gain access to the funds available under the Deerfield Facility, the ATM Program can be cancelled at any time by either us or Stifel, and our 2010 CEFF will expire June 11, 2013. We also plan to consider other public and private equity offerings as well as financing transactions, such as secured equipment financing facilities or other similar transactions.

Our future capital requirements depend upon many factors, primarily the success of our efforts to (i) execute the commercial introduction of SURFAXIN and AFECTAIR in the U.S., as planned; (ii) advance the AEROSURF development program to initiation of the planned phase 2 clinical program in the fourth quarter of 2013; and (iii) secure one or more strategic alliances or other collaboration arrangements to support the development and, if approved, the commercial introduction of SURFAXIN, SURFAXIN LS, AFECTAIR and AEROSURF in markets outside the U.S. We believe that our ability to enter into a significant strategic alliance will likely improve if we remain on track to initiate both the commercial sale of SURFAXIN and our AEROSURF phase 2 clinical program in the fourth quarter of 2013. There can be no assurance, however, that our efforts will be successful, or that we will be able to obtain additional capital to support our activities when needed on acceptable terms, if at all.

As of March 31, 2013, 100 million shares of common stock were authorized under our Amended and Restated Certificate of Incorporation, as amended, and approximately 37.6 million shares of common stock were available for issuance and not otherwise reserved.

In February 2013, we entered into a loan facility (Deerfield Facility) with affiliates of Deerfield Management Company, L.P. (Deerfield), pursuant to which Deerfield agreed to loan to us up to $30 million on a secured basis. Deerfield advanced $10 million upon execution of the agreement and agreed to advance an additional $20 million upon the first commercial sale of SURFAXIN drug product, provided that such sale occurs on or before December 31, 2013. In connection with the first disbursement, we issued to Deerfield a warrant to purchase approximately 2.3 million shares at an exercise price of $2.81. See, Note 6 – "Long-term Debt – Loan Facility with Deerfield." Under the Deerfield Facility, interest accrues at a rate of 8.75% and is payable quarterly in cash. Principal is payable beginning on the fourth anniversary of the loan and is subject to further deferral as provided in the Deerfield Facility. For the quarter ended March 31, 2013, we accrued and paid interest in the amount of $0.1 million. Also in February 2013, we entered into an At-the-Market Equity Offering Sales Agreement with Stifel, Nicolaus & Company, Incorporated (Stifel), pursuant to which Stifel, as our exclusive agent, at our discretion and at such times that we determine from time to time, may sell over a three-year period up to a maximum of $25 million of our common stock through an at-the-market program (ATM Program). We are not required to sell any shares at any time during the term of the ATM Program. We will pay Stifel a commission for each transaction equal to 3% of the gross proceeds. See, Note 4 – "Stockholders' Equity – At-the-Market Program (ATM Program)".

In addition, as of March 31, 2013, we had outstanding warrants to purchase approximately 10.3 million shares of our common stock at various prices, exercisable on different dates into 2019. Of these warrants, approximately 4.9 million are February 2011 five-year warrants, which contain anti-dilution provisions that adjust the exercise price if we issue any common stock, securities convertible into common stock, or other securities (subject to certain exceptions) at a value below the then-existing exercise price of the warrants. These warrants were issued at an exercise price of $3.20 per share, which was adjusted downward to $2.80 per share following a public offering conducted at an offering price of $2.80 per share in March 2012. As of March 31, 2013, 4,948,750 of the February 2011 five-year warrants were outstanding. The holders of the Deerfield Warrants may exercise the warrants either for cash or on a cashless basis. In addition, in lieu of paying cash, the holders may elect to reduce the principal amount of the Deerfield loan to satisfy the exercise price of the warrants upon exercise. Although we believe that, in the future, we will secure additional capital from the exercise of at least a portion of our outstanding warrants, there can be no assurance that the market price of our common stock will equal or exceed price levels that make exercise of outstanding warrants likely or that holders of outstanding warrants will choose to exercise any or all of their warrants prior to the warrant expiration date. Moreover, if our outstanding warrants are exercised, such exercises likely will be at a discount to the then-market value of our common stock and have a dilutive effect on the value of our shares of common stock at the time of exercise.

Although we currently believe that we will be able to execute our revised strategic plan and accomplish our objectives, there can be no assurance that we will be successful. We require additional capital to satisfy our debt obligations, sustain operations, and complete the development and support the commercial introduction of our products, including SURFAXIN and AFECTAIR and, if approved, AEROSURF and potentially SURFAXIN LS. There can be no assurance that we will be successful in securing the needed capital, through strategic alliances, collaboration arrangements, financings, debt arrangements and other transactions. Failure to secure the necessary additional capital would have a material adverse effect on our business, financial condition and results of operations.