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Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 30, 2013	Sep. 13, 2013
Document And Entity Information
Entity Registrant Name	Retrophin, Inc.
Entity Central Index Key	0001438533
Document Type	10-Q
Document Period End Date	Jun. 30, 2013
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	No
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		18,150,837
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2013

Consolidated Balance Sheets - USD ($)	Jun. 30, 2013	Dec. 31, 2012
Assets
Cash	$ 286,514	$ 11,388
Due from related party
Prepaid expenses and other current assets	117,895	21,830
Total current assets	404,409	33,218
Property and equipment, net	28,642	23,790
Patents pending	18,093	18,093
Due from affiliate		137,547
Security deposit	137,547
Technology license, net	2,083,851	2,178,617
Total Assets	2,672,542	2,391,265
Current liabilities:
Technology license liability		1,300,000
Accounts payable	1,425,707	1,023,320
Accrued expenses	741,610	2,467,796
Notes payable - related parties		884,764
Investors deposit		100,000
Registration payment obligation	360,000
Settlement payable	1,691,400
Due to related parties	10,000	23,200
Derivative financial instruments, at estimated fair value - warrants	6,901,223
Total current liabilities	11,129,940	5,799,080
Stockholders' Deficiency:
Preferred stock Series A $0.001 par value; 20,000,000 shares authorized; 0 issued and outstanding
Common stock $0.0001 par value; 100,000,000 shares authorized; 12,321,973 and 8,952,905 issued and outstanding, respectively	1,232	895
Additional paid-in capital	34,944,917	30,203,402
Deficit accumulated during the development stage	(43,403,547)	(33,612,112)
Total stockholders' deficit	(8,457,398)	(3,407,815)
Total liabilities and stockholders' deficit	$ 2,672,542	$ 2,391,265

Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2013	Dec. 31, 2012
STOCKHOLDERS' EQUITY ( DEFICIT )
Preferred Series A, Par Value	$ .001	$ .001
Preferred Series A,Authorized	20,000,000	20,000,000
Preferred Stock Shares A, Issued	0	0
Preferred Stock Shares A, Outstanding	0	0
Common Stock Par Value	$ .0001	$ 0.0001
Common Stock Shares Authorized	100,000,000	100,000,000
Common Stock Shares Issued	12,321,973	8,952,905
Common Stock Shares Outstanding	12,321,973	8,952,905

Consolidated Statements of Operations - USD ($)	3 Months Ended		6 Months Ended		28 Months Ended
Consolidated Statements of Operations - USD ($)	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013
Operating expenses
Compensation and related costs - inclusive of share base compensation $57,516, $1,391,863, $78,349, $2,943,767 and $17,816,166	$ 492,131	$ 1,532,943	$ 1,537,418	$ 3,302,774	$ 21,898,171
Professional fees - inclusive of share based compensation $70,872, $2,647,001, $209,243, $3,650,125 and $6,860,948	1,701,264	3,062,461	2,393,841	4,770,890	12,497,693
Selling, general and administrative	2,906,507	144,288	3,319,127	224,482	4,675,235
Technology license contingent fees			100,000		1,800,000
Total operating expenses	5,099,902	4,739,692	7,350,386	8,298,146	40,871,099
Operating loss	(5,099,902)	(4,739,692)	(7,350,386)	(8,298,146)	(40,871,099)
Other income (expense)
Interest income	5	5,984	5	9,732	21,910
Interest expense		(26,471)	(41,563)	(43,798)	(147,480)
Change in estimated fair value of derivative financial instruments - warrants	56,041		(2,395,618)		(2,395,618)
Loss on transactions denominated in foreign currencies	(4,657)		(3,873)		(11,260)
Total other income (expense), net	51,389	(20,487)	(2,441,049)	(34,066)	(2,532,448)
Net loss	$ (5,048,513)	$ (4,760,179)	$ (9,791,435)	$ (8,332,212)	$ (43,403,547)
Basic and diluted loss per share:
Net loss per common share - basic and diluted	$ (0.41)	$ (1.55)	$ (0.85)	$ (3.00)
Weighted average number of common shares outstanding during the period - basic and diluted	12,253,599	3,064,764	11,492,475	2,781,992

Consolidated Statements of Operations (Parenthetical) - USD ($)	3 Months Ended		6 Months Ended		28 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013
Income Statement [Abstract]
Compensation and related costs-Share based compensation	$ 57,516	$ 1,391,863	$ 78,349	$ 2,943,767	$ 17,816,166
Professional fees-Share based compensation	$ 70,872	$ 2,647,001	$ 209,243	$ 3,650,125	$ 6,860,948

Condensed Consolidated Statement of Changes in Stockholders' Deficit (Unaudited) - USD ($)	Common Stock	Additional Paid-In Capital	Receivables Due From Stockholder	Accumulated Deficit	Total
Beginning Balance, Shares at Mar. 10, 2011	0
Beginning Balance, Amount at Mar. 10, 2011	$ 0	$ 0	$ 0	$ 0	$ 0
Issuance of common shares, Shares	1,608,300
Issuance of common shares, Amount	$ 161	24,839	(25,000)		0
Issuance of common shares to founders in connection with the initial capital contribution, Shares	50,000
Issuance of common shares to founders in connection with the initial capital contribution, Amount	$ 5	95			100
Incentive shares granted - employees, Shares	1,758,300
Incentive shares granted - employees, Amount	$ 176	(176)			0
Incentive shares granted- non employees, Shares	381,000
Incentive shares granted- non employees, Amount	$ 38	(38)			0
Incentive shares forfeited - employees, Shares	(45,835)
Incentive shares forfeited - employees, Amount	$ (5)	5			0
Share based compensation - employees		1,724,967			1,724,967
Share based compensation - non employees		254,332			254,332
Issuance of shares in connection with March 2011 private placement, net of fees of $66,061, Shares	253,750
Issuance of shares in connection with March 2011 private placement, net of fees of $66,061, Amount	$ 25	658,914			658,939
Prior issuance of Series A preferred in connection with March 2011 private placement, net of fees of $1,367, exchanged to common stock, Shares	36,750
Prior issuance of Series A preferred in connection with March 2011 private placement, net of fees of $1,367, exchanged to common stock, Amount	$ 4	103,629			103,633
Loan made to stockholder			(10,000)		(10,000)
Net loss				(3,268,256)	(3,268,256)
Ending Balance, Shares at Dec. 31, 2011	4,042,265
Ending Balance, Amount at Dec. 31, 2011	$ 404	2,766,567	(35,000)	(3,268,256)	(536,285)
Beginning Balance, Shares at Mar. 10, 2011	0
Beginning Balance, Amount at Mar. 10, 2011	$ 0	0	0	0	0
Loan made to stockholder					382,900
Net loss					(43,403,547)
Ending Balance, Shares at Jun. 30, 2013	12,321,973
Ending Balance, Amount at Jun. 30, 2013	$ 1,232	34,944,917		(43,403,547)	(8,457,398)
Beginning Balance, Shares at Dec. 31, 2011	4,042,265
Beginning Balance, Amount at Dec. 31, 2011	$ 404	2,766,567	(35,000)	(3,268,256)	(536,285)
Issuance of Series A preferred in connection with January 2012 private placement, net of fees of $61,677 recapitalized into common stock, Shares	326,963
Issuance of Series A preferred in connection with January 2012 private placement, net of fees of $61,677 recapitalized into common stock, Amount	$ 33	1,806,644			1,806,677
Issuance of Series A preferred in connection with May 2012 private placement, net of fees of $12,275, Shares	470,764
Issuance of Series A preferred in connection with May 2012 private placement, net of fees of $12,275, Amount	$ 47	1,668,979			1,669,026
Shares transferred to consultants by founder for services rendered to the Company		4,400,000			4,400,000
Shares transferred to employees by founders for services rendered to the Company		1,375,000			1,375,000
Shares issued in accordance with technology license agreement, Shares	620,000
Shares issued in accordance with technology license agreement, Amount	$ 62	1,549,938			1,550,000
Shares outstanding at time of reverse merger completed on December 12, 2012, Shares	2,585,583
Shares outstanding at time of reverse merger completed on December 12, 2012, Amount	$ 259	1,142			1,401
Incentive shares granted - employees, Shares	866,180
Incentive shares granted - employees, Amount	$ 86	(86)			0
Incentive shares granted- non employees, Shares	87,503
Incentive shares granted- non employees, Amount	$ 9	(9)			0
Incentive shares forfeited - employees, Shares	(46,353)
Incentive shares forfeited - employees, Amount	$ (5)	5			0
Share based compensation - employees		14,637,850			14,637,850
Share based compensation - non employees		1,997,372			1,997,372
Receivable due from stockholder charged to compensation			407,900		407,900
Loan made to stockholder			(372,900)		(372,900)
Net loss				(30,343,856)	(30,343,856)
Ending Balance, Shares at Dec. 31, 2012	8,952,905
Ending Balance, Amount at Dec. 31, 2012	$ 895	30,203,402	$ 0	(33,612,112)	(3,407,815)
Incentive shares granted - employees, Shares	120,000
Incentive shares granted - employees, Amount	$ 12	(12)
Incentive shares granted- non employees, Shares	12,500
Incentive shares granted- non employees, Amount	$ 1	(1)
Incentive shares forfeited - employees, Shares	(20,833)
Incentive shares forfeited - employees, Amount	$ (2)	2
Share based compensation - employees		78,349			78,349
Share based compensation - non employees		209,243			209,243
Incentive shares forfeited - non employees, Shares	(72,082)
Incentive shares forfeited - non employees, Amount	$ (7)	7
Issuance of common stock in connection with January 2013 private placement at $3.00 per share, net of fees of $0	272,221
Issuance of common stock in connection with January 2013 private placement at $3.00 per share, net of fees of $0	$ 27	816,637			816,664
Issuance of common stock in connection with February 2013 private placement at $3.00 per share, net of fees of $678,986 and registration payment obligation of $360,000	3,045,929
Issuance of common stock in connection with February 2013 private placement at $3.00 per share, net of fees of $678,986 and registration payment obligation of $360,000	$ 305	3,592,891			3,593,196
Shares issued on behalf of related party, Shares	6,000
Shares issued on behalf of related party, Amount	$ 1	44,399			44,400
Adjustment to existing shareholder (unaudited)	$ 5,333
Loan made to stockholder
Net loss				(9,791,435)	(9,791,435)
Ending Balance, Shares at Jun. 30, 2013	12,321,973
Ending Balance, Amount at Jun. 30, 2013	$ 1,232	$ 34,944,917		$ (43,403,547)	$ (8,457,398)

Consolidated Statement of Cash Flows - USD ($)	6 Months Ended		28 Months Ended
Consolidated Statement of Cash Flows - USD ($)	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013
Cash Flows From Operating Activities
Net loss	$ (9,791,435)	$ (8,332,212)	$ (43,403,547)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	105,307	37,695	230,547
Compensation in lieu of receivable			407,900
Share based compensation - employees	78,349	2,943,767	17,816,166
Share based compensation - non-employees	209,243	3,650,125	6,860,947
Share based payment - Technology license contingent fee			1,550,000
Change in estimated fair value of derivative financial instruments - warrants	2,395,618		2,395,618
Changes in operating assets and liabilities
Prepaid expenses	(96,065)	(6,032)	(117,895)
Accounts payable and accrued expenses	312,001	89,102	3,800,796
Net cash (used) in operating activities	(6,786,982)	(1,617,555)	(10,459,468)
Cash Flows From Investing Activities
Purchase of fixed assets	(9,693)	(3,490)	(37,339)
Purchase of intangible assets	(5,700)	(1,082,971)	(1,173,793)
Repayment of technology license liability	(1,300,000)		(1,150,000)
Cash received in merger transaction			3,721
Payments made on behalf of affiliate			(137,547)
Loans made to stockholder			(382,900)
Increase in note receivable - related party		(193,500)
Net cash used in investing activities	(1,315,393)	(1,279,961)	(2,877,858)
Cash Flows From Financing Activities
Proceeds from advances related parties			56,500
Repayment of advances receivable from related parties	(13,200)		(46,500)
Proceeds from note payable - related party		838,764	930,000
Repayment of note payable - related party	(884,764)		(930,000)
Investors' deposit			100,000
Proceeds received from issuance of common stock, net of fees of $678,986, $73,952, and $820,367, respectively	9,275,465	2,045,115	13,513,840
Repayment of stock subscription receivable		35,000
Net cash provided in financing activities	8,377,501	2,918,879	13,623,840
Net increase in cash	275,126	21,363	286,514
Cash, beginning of period	11,388	10,053
Cash, end of period	286,514	31,416	286,514
Supplemental Disclosure of Cash Flow Information
Cash paid for interest	28,263		43,027
Non-cash investing and financing activities:
Forfeiture of subscription receivable			25,000
Shares issued on behalf of related party	44,400		44,400
Allocation of proceeds from issuance of common stock to registration payment arrangement	$ 360,000		$ 360,000

1. DESCRIPTION OF BUSINESS

6 Months Ended

Jun. 30, 2013

Notes to Financial Statements

1. DESCRIPTION OF BUSINESS

Organization and Description of Business

Retrophin, Inc. (the “Company”) is an emerging biotechnology company dedicated to developing drugs for rare and life-threatening diseases. The Company’s primary business objective is to develop and commercialize therapies for orphan diseases, such as Duchenne muscular dystrophy, or DMD, focal segmental glomerulosclerosis, and pantothenate kinase-associated neurodegeneration. The Company is considered to be a development stage company and, as such, the Company’s financial statements are prepared in accordance with the Accounting Standards Codification (“ASC”) 915 “Development Stage Entities.” The Company is subject to all of the risks and uncertainties associated with development stage companies.

2. BASIS OF PRESENTATION	6 Months Ended
2. BASIS OF PRESENTATION	Jun. 30, 2013
Organization, Consolidation and Presentation of Financial Statements [Abstract]
2. BASIS OF PRESENTATION	The accompanying unaudited condensed consolidated financial statements of the Company should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K/A for the year ended December 31, 2012 (the “2012 10-K/A”) filed with the Securities and Exchange Commission (the “SEC”) on September 13, 2013. The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information, the instructions to Form 10-Q and the rules and regulations of the SEC. Accordingly, since they are interim statements, the accompanying condensed consolidated financial statements do not include all of the information and notes required by GAAP for annual financial statements, but reflect all adjustments consisting of normal, recurring adjustments, that are necessary for a fair presentation of the financial position, results of operations and cash flows for the interim periods presented. Interim results are not necessarily indicative of results for a full year. The December 31, 2012 balance sheet information was derived from the audited financial statements as of that date.

3. LIQUIDITY AND FINANCIAL CONDITION AND MANAGEMENT’S PLANS

6 Months Ended

Jun. 30, 2013

Organization, Consolidation and Presentation of Financial Statements [Abstract]

3. LIQUIDITY AND FINANCIAL CONDITION AND MANAGEMENT’S PLANS

The Company incurred a net loss of approximately $43 million, including stock-based compensation charge of approximately $25 million for the period from March 11, 2011 (inception) to June 30, 2013. At June 30, 2013, the Company had a cash balance of approximately $286,500 and a working capital deficit of approximately $10.7 million. The Company’s accumulated deficit amounted to $43,403,547 at June 30, 2013.

The Company has principally financed its operations from inception using proceeds from sales of its equity securities in a series of private placement transactions (see Note 10 and Note 12). The Company to date has no revenues, significantly limited capital resources and is subject to all of the risks and uncertainties that are typical of a development stage enterprise. Significant uncertainties include, among others, whether it will be able to raise the capital it needs to finance the start of its planned operations and whether such operations, if launched, will enable the Company to become a profitable enterprise.

On August 14, 2013, the Company and the investors who participated in the private placement transaction that the Company completed on February 14, 2013, entered into the first amendment to the registration rights agreement (the “Amended Registration Rights Agreement”) associated with that transaction. The Amended Registration Rights Agreement provides, among other things, for (i) a waiver of any and all liquidated damages that the Company incurred for its inability to cause the a registration statement to be declared effective within certain contractually defined time-frames stipulated in the original agreement; (ii) a commitment on the part of the investors in the February private placement to participate in a private placement transaction that the Company completed on August 15, 2013, and (iii) a covenant on the part of the Company to proceed with the sale of shares that were issued under the August 15, 2013 private placement transaction. In exchange, the Company paid an aggregate fee to these investors of $2,495,256 consisting of (i) 73,710 shares of the Company’s common stock with an aggregate fair value of $331,695 (based on the selling price of $4.50 per share in the August financing transaction ); (ii) cash in the amount of $1,835,000 (Note 13); and (iii) warrants to purchase 98,756 shares of common stock with a fair value of $328,561. The investors were also given the option to purchase shares of the Company’s common stock at $4.50 as a use of the cash portion of the payment arrangement. Accordingly, $946,196 of the cash portion of the fee was settled in cash and the remainder was settled by the issuance of 197,512, shares. Additionally, the Company paid $103,425 to an investor to whom the Company sold shares in a private placement transaction in January 2013 and who participated in the August 2013 private placement transaction. This payment was settled entirely by the issuance of 20,685 shares of the Company’s common stock at a value of $5.00 per share.

The Company entered into an additional settlement agreement on August 29, 2013 (Note 13).

In the second quarter of 2013, the Company, its Chief Executive Officer and a related party became parties to a series of agreements to settle up to $2,286,511 of liabilities, which Company management believes are the primary obligation of the related party. The Company paid $593,111 of these settlements in the second quarter on behalf of the related party and had outstanding liabilities of $1,691,400 as of June 30, 2013, which is entirely past due as of the date of this filing. The counter parties to these agreements reserve the right to demand payment at any time. The Chief Executive Officer also agreed to deliver or cause to be delivered 47,128 shares of common stock to one of the counter parties as a separate component of one of these agreements. Accordingly, the Company does not believe it is required to record a liability for the shared-based component of this specific agreement during the second quarter ended June 30, 2013. There is uncertainty as to whether the related party will have sufficient liquidity to repay the Company or fund the indemnification agreements should it become necessary (see Note 9).

On August 29, 2013, the Company entered into an additional settlement agreement for $300,000 due following execution of the agreement. As of the date of this filing, this settlement has been paid (see Note 13).

These conditions raise substantial doubt about the Company’s ability to continue as a going concern. These condensed consolidated financial statements do not include any adjustments relating to the recovery of assets or the classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Management believes the Company’s ability to continue its operations depends on its ability to raise capital. In February 2012, the Company entered into a license agreement providing it with the use of certain technology. The Company is currently developing pre-clinical and clinical studies of drug candidates. The license agreement (described in Note 7) also enables the Company to sell the licensed technology as a research product or sublicense the technology to other third parties as alternative sources of revenue to its own product development efforts. The Company’s future depends on the costs, timing, and outcome of regulatory reviews of its product candidates and the costs of commercialization activities, including product marketing, sales and distribution. During the first quarter of 2013, the Company raised an aggregate of approximately $9.95 million in certain private placement transactions. During the third quarter of 2013, the Company raised an additional $25 million in aggregate proceeds in connection with a private placement transaction. The Company expects to continue to finance its cash needs through additional private equity offerings and debt financings, corporate collaboration and licensing arrangements and grants from patient advocacy groups, foundations and government agencies. Although management believes that the Company has access to capital resources, there are no commitments for financing in place at this time, nor can management provide any assurance that such financing will be available on commercially acceptable terms, if at all.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2013

Accounting Policies [Abstract]

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A summary of the significant accounting policies applied in the preparation of the accompanying condensed consolidated financial statements follows:

Principles of Consolidation

The condensed consolidated financial statements represent the consolidation of the accounts of the Company and its subsidiary in conformity with U.S. GAAP. All intercompany accounts and transactions have been eliminated in consolidation.

Cash and Cash Equivalents

For purposes of the statement of cash flows, the Company considers cash instruments with maturities of less than three months when purchased to be cash equivalents. There are no cash equivalents as of the balance sheet dates.

Property and Equipment

Property and equipment are stated at cost. Depreciation is provided for using the straight-line method over the estimated useful lives of the assets. At June 30, 2013 and 2012, property and equipment consisted of computers with an estimated useful life of three years, leasehold improvements with an estimated life of four years and furniture with an estimated life of seven years.

Employee Stock-Based Compensation

The Company accounts for stock-based compensation in accordance with ASC 718 Compensation — Stock Compensation (“ASC 718”). ASC 718 addresses all forms of share-based payment (“SBP”) awards including shares issued under employee stock purchase plans and stock incentive shares. Under ASC 718 awards result in a cost that is measured at fair value on the awards’ grant date, based on the estimated number of awards that are expected to vest and will result in a charge to operations.

Non-Employee Stock-Based Compensation

The Company accounts for equity instruments issued to non-employees in accordance with the provisions of ASC 505, “Equity Based Payments to Non-Employees”, (“ASC 505”) and ASC 718 which requires that such equity instruments are recorded at their fair value on the measurement date. The measurement of stock-based compensation is subject to periodic adjustment as the underlying equity instruments vest. Non-employee stock-based compensation charges are being amortized over their respective contractual vesting periods.

Use of Estimates

In preparing financial statements in conformity with U.S.GAAP management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of expenses during the reporting period. Due to inherent uncertainty involved in making estimates, actual results reported in future periods may be affected by changes in these estimates. On an ongoing basis, the Company evaluates its estimates and assumptions. These estimates and assumptions include valuing equity securities in share-based payments, estimating fair value of equity instruments recorded as derivative liabilities, estimating the useful lives of depreciable and amortizable assets and estimating the fair value of long-lived assets to assets whether impairment charges may apply.

Research and Development Costs

Research and development costs are charged to operations as incurred and consist primarily of consulting costs, contract research and development costs, and compensation costs. For the three and six months ended June 30, 2013 and 2012, and for the period from March 11, 2011 (inception) through June 30, 2013, the Company recognized $605,203, $141,962, $713,937, $176,233, and $1,608,451, respectively, of research and development costs.

Patents

The Company capitalized external cost, such as filing fees and associated attorney fees, incurred to obtain issued patents and patent applications pending. The Company expense cost associated with maintaining and defending patents subsequent to their issuance in the period incurred. The Company amortizes patent cost once issued on a straight-line basis over the estimate useful lives of the patents. The Company assess the potential impairment to all capitalized patent cost when events or changes in circumstances indicate that the carrying amount of our patent may not be recoverable.

Basic and diluted Net Loss Per Share

Basic and diluted net loss per share has been computed by dividing net loss by the weighted average number of common shares outstanding during the period. All potentially dilutive common shares have been excluded since their inclusion would be anti-dilutive.

An aggregate of 1,597,969 and 0 warrants were excluded from the computation of diluted net loss per common share for the three and six months ended June 30, 2013 and 2012 because to do so would have an anti-dilutive effect for the periods presented.

An aggregate of 120,000 and 0 stock options were excluded from the computation of diluted net loss per common share for the three and six months ended June 30, 2013 and 2012 because they were contingent options subject to recall and to do so would have an anti-dilutive effect for the periods presented.

An aggregate of 231,493 and 1,973,142 common stock equivalents (incentive shares) were excluded from the computation of diluted net loss per common share for the three and six months ended June 30, 2013 and 2012 because they were contingent shares subject to recall.

Derivative Instruments

The Company does not use derivative instruments to hedge exposures to cash flow, market or foreign currency risks. The Company evaluates all of its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then revalued at each reporting date, with changes in the fair value reported in the statements of operations. For stock-based derivative financial instruments, the Company calculates the fair value of the financial instruments using a probability-weighted Black-Scholes option pricing model, which is comparable to the Binomial Lattice options pricing model at inception and on each subsequent valuation date. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. (See Note 5 and Note 6).

Joint and Several Liability Assessment

The Company measures obligations resulting from joint and several liability arrangements as the sum of the amount that the Company has (a) contractually agreed to pay, and (b) any additional amounts that the Company expects to pay on behalf of its co-obligors.

Financial Instruments and Fair Value

ASC Topic 820, “Fair Value Measurements and Disclosures,” (“ASC Topic 820”) establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under ASC Topic 820 are described below:

Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2 – Quoted prices in markets that are not active or financial instruments for which all significant inputs are observable, either directly or indirectly; and

Level 3 – Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.

In estimating the fair value of the Company’s derivative liabilities, the Company used a probability-weighted Black-Scholes option pricing model. (See Note 5 and Note 6).

Financial assets with carrying values approximating fair value include cash and cash equivalents as well as prepaid expenses and other current assets. Financial liabilities with carrying values approximating fair value include accounts payable and other accrued liabilities.

Registration Payment Arrangement

The Company accounted for registration rights agreements in accordance with ASC 825-20, “Registration Payment Arrangements.” ASC 825-20 addresses an issuer’s accounting for registration payment arrangements. This pronouncement specifies that the contingent obligation to make future payments or otherwise transfer consideration under a registration payment arrangement, whether issued as a separate agreement or included as a provision of a financial instrument, should be separately recognized and accounted for as a contingency in accordance with ASC 450-20 “Loss Contingencies”.

Subsequent Events

The Company follows the provisions of ASC Topic 855-10, “Subsequent Events,” relating to subsequent events. This guidance establishes principles and requirements for subsequent events. This guidance defines the period after the balance sheet date during which events or transactions that may occur would be required to be disclosed in a company’s financial statements. The Company has evaluated subsequent events up to the date of issuance of this report.

Recently Issued Accounting Pronouncements

In February 2013, the FASB issued Accounting Standards Updated (“ASU”) 2013-04 “Obligations Resulting from Joint and Several Liability Arrangements for Which the Amount at the Reporting Date is Fixed”) (“ASU 2013-04”). The guidance in this update is effective for fiscal years beginning after December 15, 2013 with early adoption permitted. The guidance in this update requires companies to measure obligations resulting from joint and several liability arrangements as the sum of the amount the entity has (a) contractually agreed to pay, and (b) any additional amounts that the entity expects to pay on behalf of its co-obligors. The Company early adopted this guidance in the second quarter of 2013 (Note 9 and Note 13).

Except as noted above, management does not believe that any recently issued, but not yet effective accounting pronouncements, if adopted, would have a significant effect on the accompanying consolidated financial statements.

5. DERIVATIVE FINANCIAL INSTRUMENTS

6 Months Ended

Jun. 30, 2013

Derivative Instruments and Hedging Activities Disclosure [Abstract]

5. DERIVATIVE FINANCIAL INSTRUMENTS

In accordance with ASC Topic 815-40, “Derivative and Hedging – Contracts in Entity’s Own Equity” (“ASC Topic 815-40”), instruments which do not have fixed settlement provisions are deemed to be derivative instruments. Based upon the Company’s analysis of the criteria contained in ASC Topic 815-40, the warrants issued in connection with the sale of the common stock during the period ended June 30, 2013 that do not have fixed settlement provisions, are not indexed to Company’s own stock. The fair value of the warrants are classified as derivative liabilities due to a ratchet provision that allows for a favorable adjustment to the exercise price if the Company issues additional equity instruments in the future at an effective price per share less than the exercise price then in effect.

The warrants are re-measured at each balance sheet date based on estimated fair value. Changes in estimated fair value are recorded as non-cash valuation adjustments within other income (expense) in the Company’s results of operations. The Company recorded a gain and loss on a change in the estimated fair value of warrants of $56,041 and $2,395,618 for the three and six months ended June 30, 2013, respectively.

The Company calculated the fair value of the warrants using a probability-weighted Black-Scholes option pricing model which is comparable to the Binomial Lattice pricing model. The assumptions used at the date of issuance and at June 30, 2013 are noted in the following table:

			As of
				Date of issuance February 14, 2013	June 30, 2013
Fair market price of common stock				$3.75	$5.50
Expected option term	5 years				4.63 years
Risk-free interest rate		0.86%			1.41%
Expected volatility		101% 98.59%

Expected volatility is based on historical stock volatilities of several comparable publicly-traded companies over a period equal to the expected terms of the warrants, as the Company does not have a long trading history to estimate the volatility of its own common stock. The warrants have a transferability provision. Based on guidance provided in SEC Staff Accounting Bulletin No. 107 (“SAB 107”) for options issued with such a provision, the Company used the full contractual term as the initial expected term of the warrants. The risk free interest rate is based on the U.S. Treasury security rates for the remaining term of the warrants at the measurement date.

- Definition

The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts.

+ References

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+ Details

6. FAIR VALUE MEASUREMENTS

6 Months Ended

Jun. 30, 2013

Fair Value Disclosures [Abstract]

6. FAIR VALUE MEASUREMENTS

The following table presents the Company’s liability that is measured and recognized at fair value on a recurring basis classified under the appropriate level of the fair value hierarchy as of June 30, 2013:

		Fair Value Measurements at June 30, 2013
	Total carrying value at June 30, 2013	Quoted prices in active markets (Level 1)	Significant other observable inputs (Level 2)	Significant unobservable inputs (Level 3)

Derivative liabilities related to warrants	$ 6,901,223	$ -	$ -	$ 6,901,223

The following table sets forth a summary of changes in the estimated fair value of the Company’s Level 3 liability for the six months ended June 30, 2013:

	Fair Value Measurements of Common Stock Warrants Using Significant Unobservable Inputs (Level 3)
Balance at December 31, 2012	$ -
Issuance of common stock warrants	4,505,605
Change in fair value of common stock warrant liability	2,395,618
Balance at June 30, 2013	$ 6,901,223

A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. At each reporting period, the Company performs a detailed analysis of the assets and liabilities that are subject to ASC Topic 820. At each reporting period, all assets and liabilities for which the fair value measurement is based on significant unobservable inputs or instruments which trade infrequently and therefore have little or no price transparency are classified as Level 3.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

7. LICENSE AGREEMENT

6 Months Ended

Jun. 30, 2013

Notes to Financial Statements

7. LICENSE AGREEMENT

On February 16, 2012 the Company entered into an agreement pursuant to which a biotech company (the “Sublicensor”) with license rights to certain drug technologies agreed to grant us a worldwide sublicense for the development, manufacture and commercialization of RE-021 (DARA). The licensing agreement also enables the Company to sell the licensed technology as a research product or sublicense the technology to other third parties as potential sources of revenue. Under the license agreement, Sublicensor is obligated to transfer to the Company certain information, records, regulatory filings, materials and inventory controlled by Sublicensor and relating to or useful for developing RE-021. The Company must use commercially reasonable efforts to develop and commercialize RE-021 in specified major market countries and other countries in which the Company believes it is commercially reasonable to develop and commercialize such products. The agreement shall continue until neither party has any obligations under the agreement to make payments to the other party.

In accordance with the agreement as amended most recently as of January 7, 2013, the Company made two non-refundable payments totaling $2,550,000, the first payment of $1,150,000 made upon execution and the second payment of $1,400,000 made in February 2013, which includes a $250,000 fee payable to the sublicensee in exchange for extended due date of this payment from October 1, 2012 to February 2013. As of June 30, 2013, the Company has recognized $2,300,000 for the cost of the License Agreement which is presented in the accompanying consolidated balance sheet as an intangible asset that is being amortized on a straight-line basis over the term of the License Agreement which expires on September 30, 2023. The $250,000 of extension fees were expensed to operations in February 2013. In addition, the Company issued 620,000 common shares to Ligand valued at $1,550,000 as a result of the merger transaction, the amount of which was expensed to operations in December 2012. For the three and six months ended June 30, 2013 and 2012, and for the period from March 11, 2011 (inception) through June 30, 2013, the Company recognized amortization expense of the license related to this agreement of $50,511, $36,581, $100,466, $36,581, and $221,849 respectively.

8. NOTES PAYABLE

6 Months Ended

Jun. 30, 2013

Debt Disclosure [Abstract]

8. NOTES PAYABLE

Note Payable - related party

On February 1, 2012, the Company entered into a secured promissory note with a related party in the amount of $900,000, with an interest rate of 12% per annum, compounded monthly. The outstanding principal and interest balance of this note was fully repaid during the first quarter of 2013.

Total interest expense recognized for the three and six months ended June 30, 2013 and 2012, and for the period from March 11, 2011 (inception) through June 30, 2013 amounted to $0, $26,471, $19,733, $43,798 and $147,480, respectively.

9. RELATED PARTY TRANSACTIONS

6 Months Ended

Jun. 30, 2013

9. RELATED PARTY TRANSACTIONS

On December 8, 2011, the Company received advances of funds aggregating $8,500 from entities related through common ownership. Such advances were repaid during the first quarter of 2013.

In August 2012, the Company paid a security deposit on behalf of an affiliate of $137,547 in connection with a building lease entered into by such affiliate. The Company assumed the lease from its affiliate in April 2013, whereby the security deposit was assigned to the Company. The Company leases approximately 4,216 square feet of office space for approximately $275,000 per year base rent plus rent escalations, common area maintenance, insurance, and real estate taxes, under a lease agreement expiring August 2016.

In the second quarter of 2013, the Company, its Chief Executive Officer and a related party became party to a series of agreements to settle up to $2,286,511 of liabilities, which Company management believes are the primary obligation of the related party. The Company and the related party have entered into indemnification agreements whereby the related party has agreed to defend and hold the Company harmless against all such obligations and amounts, whether paid or unpaid, arising from these agreements. Notwithstanding the indemnification, the Company recorded a $2,286,511 charge to operations during the quarter ended June 30, 2013 and a corresponding liability of $1,691,400 for the difference between (a) the aggregate amount of all such settlements, and (b) $593,111 of cash and non-cash consideration that the Company paid to immediately settle a portion of the agreement on behalf of the related party. The $1,691,400 is past due as of the August 9, 2013. The counter parties to these agreements reserve the right to demand payment at any time. The Chief Executive Officer also agreed to deliver or cause to be delivered 47,128 shares of common stock to one of the counter parties as a separate component of one of these agreements. Accordingly, the Company does not believe it is required to record a liability for the shared-based component of this specific agreement during the second quarter ended June 30, 2013. There is uncertainty as to whether the related party will have sufficient liquidity to repay the Company or fund the indemnification agreements should it become necessary. As of the date of this filing, the Company owes $1,655,000 in cash and 5,000 shares of common stock valued at $36,400, due immediately.

Concurrent with the execution of such settlement agreements, the Company received promissory notes from the related party whereby the related party agreed to pay the Company the principal amount of $593,111 plus interest at an annualized rate of 5% as reimbursement of the payments that the Company made to settle a portion of the agreements.

The Company applied the accounting guidance provided in ASU 2013-04. The guidance in this update is effective for fiscal years beginning after December 15, 2013 with early adoption permitted. The guidance in this update requires companies to measure obligations resulting from joint and several liability arrangements as the sum of the amount that the entity has (a) contractually agreed to pay, and (b) any additional amounts that the entity expects to pay on behalf of its co-obligors. The Company has recorded the full amount of the settlements as a charge to its operations due to uncertainty as to whether the related party will have sufficient liquidity to repay the Company or fund the indemnification agreements should it become necessary. Any amounts that the Company may recover under the note due from the related party or under the terms of the indemnification agreement, if in fact any amounts are recovered at all, would be characterized as a capital contribution at the date such payments are received.

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

+ References + Details

10. STOCKHOLDERS DEFICIT

6 Months Ended

Jun. 30, 2013

Equity [Abstract]

10. STOCKHOLDERS DEFICIT

Issuances

Common Stock

In January 2013, the Company sold an aggregate of 272,221 shares of common stock, at a purchase price of $3.00 per share in certain private placement transactions, for an aggregate purchase price of $816,664 in cash. The issuance of such shares of common stock was not registered under the Securities Act as such issuance was exempt from registration under Section 4(2) of the Securities Act and Regulation D promulgated thereunder.

On February 14, 2013, the Company closed a private placement (the “Private Placement”) of 3,045,929 shares of common stock, at a purchase price of $3.00 per share, or $9,137,787 in the aggregate, and warrants (the “Warrants”) to purchase up to an aggregate of 1,597,969 shares of common stock with an exercise price of $3.60 per such share underlying any Warrant. The Warrants are deemed to be derivative instruments due to a ratchet provision that adjusts the exercise price if the Company issues additional equity instruments in the future at an effective price per share less than the exercise price then in effect. Upon issuance of the warrants, the Company recorded a liability of $4,505,605 to derivative financial instruments in its balance sheet.

On February 14, 2013, in connection with the closing of the Private Placement, the Company entered into a Registration Rights Agreement (the “Registration Rights Agreement”) with the purchasers in the Private Placement (the “Purchasers”), which sets forth the rights of the Purchasers to have their shares of common stock purchased in the Private Placement and shares of common stock issuable upon exercise of the Warrants registered with the SEC for public resale.

Pursuant to the Registration Rights Agreement, the Company was required to file a Registration Statement on Form S-1 (the “Registration Statement”) with the SEC within 30 days of the date of the Registration Rights Agreement registering the total number of shares of common stock purchased in the Private Placement and shares of common stock issuable upon exercise of the Warrants. The Company further agreed to use its reasonable efforts to have the Registration Statement declared effective within 60 days after the date of the Registration Rights Agreement (or, in the event of a “full review” by the SEC, within 90 days after the date of the Registration Rights Agreement). The Company has also agreed to use reasonable efforts to maintain the effectiveness of the Registration Statement until all of the securities covered by the Registration Statement have or may be sold by investors under Rule 144 of the Securities Act, without volume or manner-of-sale restrictions.

The Registration Rights Agreement provided that in the event the Registration Statement was not filed or declared effective within the prescribed time period or if the Company failed to maintain the effectiveness of the Registration Statement as required for specified time periods, the Company shall pay to the holders of registrable securities, on the date of each such event and on each monthly anniversary thereof until the applicable event is cured, partial liquidated damages equal to 2.0% of the aggregate purchase price paid by such Purchaser in the Private Placement, up to a maximum of 10.0% of such aggregate purchase price. If the Company fails to pay any partial liquidated damages pursuant to this Section in full within seven days after the date payable, the Company will pay interest thereon at a rate of 18% per annum (or such lesser maximum amount that is permitted to be paid by applicable law) to the Purchaser, accruing daily from the date such partial liquidated damages are due until such amounts, plus all such interest thereon, are paid in full.

The Company determined, as of the date of the financing transaction, that it was probable that it would not be in a position to cause the registration statement to be declared effective within the contractually defined time period. Accordingly, the Company allocated approximately $360,000 of the proceeds to a registration payment arrangement liability on the date that the financing transaction closed, in accordance with the guidelines of ASC 825-20. As described in Notes 2 and 13, the Company and the investors who are parties to the registration payment arrangement entered into an the Amended Registration Rights Agreement which provides, among other things, for a waiver of the liquidated damages that the Company incurred under the original terms of the registration payment arrangement described herein.

Subsequent to June 30, 2013, in connection with a private placement transaction which closed in August 2013, the Company amended the February 2013 Registration Rights Agreement (see Note 13).

Stock Options

On May 13, 2013, the Company issued options (the “Options”) to purchase 120,000 shares of common stock in connection with an employment agreement with Horacio Plotkin, M.D. (the “Plotkin Employment Agreement”) pursuant to which Dr. Plotkin was appointed as Chief Medical Officer of the Company. The options vest quarterly on a pro rata portion during the 3 years following the effective date of July 1, 2013. The Company valued these Options using the Black-Scholes options pricing model and the following assumption terms: risk-free interest rate of .83% (based on the US Treasury note yield), expected term (in years) of 5.81 (based on guidance provided in SAB 107 that allows the Company to use the simplified method for “plain vanilla” options for this calculation), expected volatility of 98.56% (based on historical stock volatilities of several comparable publicly-traded companies over a period equal to the expected term of the options, as the Company does not have a long trading history to estimate the volatility of its own common stock), and an exercise price equal to the fair value of the stock on the date of issuance of $8.70 per share. For the three and six months ended June 30, 2013 the Company recognized $36,683 as compensation expense related to the Options. At June 30, 2013, the unrecognized compensation expense, remaining amortization period, intrinsic value and remaining contract life of the Options are $768,049, 2.75 years, $0 and 9.87 years, respectively.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

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+ Details

11. INCENTIVE SHARES

6 Months Ended

Jun. 30, 2013

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

11. INCENTIVE SHARES

At June 30, 2013, the Company did not have any active share-based compensation plans available for grants to employees, non-employee directors and consultants. Since its inception, the Company has granted incentive shares.

For the three and six months ended June 30, 2013 and 2012, and for the period from March 11, 2011 (inception) through June 30, 2013, the Company recognized $91,705, $4,038,864, $250,909, $6,593,892 and $24,640,431 as compensation expense related to incentive shares granted in the consolidated statements of operations, respectively. Share compensation for non-employee awards subject to vesting is being accrued at current fair value. As of June 30, 2013, there was approximately $1,114,984, of unrecognized compensation cost related to incentive shares issued. This amount is expected to be recognized over a weighted average of 2.17 years.

	Employee - number of shares		Non Employee - number of shares		Total number of shares		Weighted Average Fair Value

Unvested December 31, 2011	1,281,225		321,165		1,602,390		$	4.00
Granted	866,180		87,503		953,683			12.89
Vested	(2,048,280	)	(193,672	)	(2,241,952	)		7.34
Forfeited	(46,353	)	-		(46,353)	)		9.06
Unvested December 31, 2012	52,772		214,996		267,768			5.79
Granted	120,000		12,500		132,500			6.17
Vested	(11,112)		(64,748)		(75,860)			7.04
Forfeited	(20,833)		(72,082)		(92,915)			4.00
Unvested June 30, 2013	140,827		90,666		231,493		$	4.82

All of the Company’s share base payments were originally issued as Retrophin LLC Class B incentive units that represent a profits interest up through the date of Retrophin LLC’s conversation to a C Corporation, which was structured as a tax free exchange transaction.

Shares granted as incentive shares were originally subject to certain conditions at the time of grant. Such conditions specified that upon the occurrence of a Termination Event, as defined in the amended operating agreement the Company shall have the right, but not the obligation, to repurchase, all, of the vested incentive shares owned by such incentive shareholder, at a purchase price based on the fair market value of the incentive shares determined in good faith by the Board of Directors. The aforementioned repurchase option was rescinded upon the Company’s conversion to a corporation.

Effective May 20, 2013, the Company entered into an employment agreement with Marc L. Panoff (the “Panoff Employment Agreement”) pursuant to which Mr. Panoff was appointed as Chief Financial Officer and Chief Accounting Officer of the Company. In accordance with the terms of the Panoff Employment Agreement, Mr. Panoff will be granted 120,000 units of restricted common stock of the Company, a pro rata portion of which will vest quarterly beginning on December 31, 2013 during the 3 years following the effective date.

12. COMMITMENTS AND CONTINGENCIES

6 Months Ended

Jun. 30, 2013

Commitments and Contingencies Disclosure [Abstract]

12. COMMITMENTS AND CONTINGENCIES

The Company assumed a building lease from an affiliate in April 2013 and is responsible for rent of approximately $275,000 annually through August 2016 (see Note 9).

The Company is obligated to pay $1,835,000 and 73,710 shares of Common Stock in liquidated damages in accordance with the February 14, 2013 Registration Rights Agreement (see Note 10).

The Company is required to make an upfront fee payment in connection with an exclusivity agreement entered into with a major pharmaceutical company in August 2013 (see Note 13).

13. SUBSEQUENT EVENTS

6 Months Ended

Jun. 30, 2013

Subsequent Events [Abstract]

13. SUBSEQUENT EVENTS

First Amendment to the February Registration Rights Agreement

As described in Notes 3 and 10, the Company and the investors who participated in the private placement transaction that the Company completed on February 14, 2013, entered into the Amended Registration Rights Agreement which provides, among other things, for (i) a waiver of any and all liquidated damages that the Company incurred for its inability to cause the registration statement from its February 14, 2013 private placement to be declared effective within certain contractually defined time-frames; (ii) a commitment on the part of the investors in the February private placement to participate in a private placement transaction that the Company completed on August 15, 2013 and (iii) a covenant on the part of the Company to proceed with the sale of shares that were issued under the August 15, 2013 private placement transaction. In exchange, the Company paid an aggregate fee to these investors of $2,495,256 consisting of (i) 73,710 shares of the Company’s common stock with an aggregate fair value of $331,695 (based on the selling price of $4.50 per share in the August financing transaction ); (ii) cash in the amount of $1,835,000; and (iii) warrants to purchase 98,756 shares of common stock with a fair value of $328,561. The investors were also given the option to purchase shares of the Company’s common stock at $4.50 as a use of the cash portion of the payment arrangement. Accordingly, $946,196 of the cash portion of the fee was settled in cash and the remainder was settled by the issuance of 197,512, shares. Additionally, the Company paid $103,425 to an investor to whom the Company sold shares in a private placement transaction in January 2013 and who participated in the August 2013 private placement transaction. This payment was settled entirely by the issuance of 20,685 shares of the Company’s common stock at a value of $5.00 per share. The Company will record the aggregate amount of the payments made to the investors by to allocating approximately $360,000 to the waiver of the original registration payment obligation to be taken as a charge to operations and the remaining amount of $2,238,681 will be treated as reduction of the proceeds received in the August financing transaction.

Private Placement Transaction

On August 15, 2013, the Company closed a private placement and sold 5,536,957 shares of the Company’s common stock, at a purchase price of $4.50 per share, or approximately $25,000,000 in the aggregate, and warrants to purchase up to an aggregate of 2,768,479 shares of common stock with an exercise price of $6.00 per share underlying each warrant. The Warrants are deemed to be derivative instruments due to a ratchet provision that adjusts the exercise price if the Company issues additional equity instruments in the future at an effective price per share less than the exercise price then in effect. The issuance of the shares of common stock in such private placement was not registered under the Securities Act as such issuance was exempt from registration under Section 4(2) of the Securities Act and Regulation D promulgated thereunder.

Exclusivity Agreement

On August 16, 2013, the Company announced that it had signed an agreement with a major pharmaceutical company for the exclusive right to negotiate a royalty-bearing U.S. license for a product to be developed for the treatment of Autism and Schizophrenia. Pursuant to the exclusivity agreement, the Company paid the major pharmaceutical company a non-refundable upfront fee and will have an exclusive period of 120 days to negotiate a license agreement. Upon execution of a license agreement, the Company would receive the exclusive right to the intellectual property to develop, manufacture and sell the product in the United States and would pay an additional fee to the major pharmaceutical company.

Additional Settlement Agreement

On August 29, 2013, the Company entered into an additional settlement agreement for $300,000 due following execution of the agreement. The Company charged this amount to selling, general and administrative expense in its statement of operations. As of the date of this filing, this settlement has been paid.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	6 Months Ended
	Jun. 30, 2013
Summary Of Significant Accounting Policies Policies
Principles of Consolidation	Principles of Consolidation The condensed consolidated financial statements represent the consolidation of the accounts of the Company and its subsidiary in conformity with U.S. GAAP. All intercompany accounts and transactions have been eliminated in consolidation.
Cash and Cash Equivalents	Cash and Cash Equivalents For purposes of the statement of cash flows, the Company considers cash instruments with maturities of less than three months when purchased to be cash equivalents. There are no cash equivalents as of the balance sheet dates.
Property and Equipment	Property and Equipment Property and equipment are stated at cost. Depreciation is provided for using the straight-line method over the estimated useful lives of the assets. At June 30, 2013 and 2012, property and equipment consisted of computers with an estimated useful life of three years, leasehold improvements with an estimated life of four years and furniture with an estimated life of seven years.
Employee Stock-Based Compensation	Employee Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC 718 Compensation — Stock Compensation (“ASC 718”). ASC 718 addresses all forms of share-based payment (“SBP”) awards including shares issued under employee stock purchase plans and stock incentive shares. Under ASC 718 awards result in a cost that is measured at fair value on the awards’ grant date, based on the estimated number of awards that are expected to vest and will result in a charge to operations.
Non-Employee Stock-Based Compensation	Non-Employee Stock-Based Compensation The Company accounts for equity instruments issued to non-employees in accordance with the provisions of ASC 505, “Equity Based Payments to Non-Employees”, (“ASC 505”) and ASC 718 which requires that such equity instruments are recorded at their fair value on the measurement date. The measurement of stock-based compensation is subject to periodic adjustment as the underlying equity instruments vest. Non-employee stock-based compensation charges are being amortized over their respective contractual vesting periods.
Use of Estimates	Use of Estimates In preparing financial statements in conformity with U.S. GAAP, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of expenses during the reporting period. Due to inherent uncertainty involved in making estimates, actual results reported in future periods may be affected by changes in these estimates. On an ongoing basis, the Company evaluates its estimates and assumptions. These estimates and assumptions include valuing equity securities in share-based payments, estimating fair value of equity instruments recorded as derivative liabilities, estimating the useful lives of depreciable and amortizable assets and estimating the fair value of long-lived assets to assets whether impairment charges may apply.
Research and Development Costs	Research and Development Costs Research and development costs are charged to operations as incurred and consist primarily of consulting costs, contract research and development costs, and compensation costs. For the three and six months ended June 30, 2013 and 2012, and for the period from March 11, 2011 (inception) through June 30, 2013, the Company recognized $605,203, $141,962, $713,937, $176,233, and $1,608,451, respectively, of research and development costs.
Patents	Patents The Company capitalized external cost, such as filing fees and associated attorney fees, incurred to obtain issued patents and patent applications pending. The Company expense cost associated with maintaining and defending patents subsequent to their issuance in the period incurred. The Company amortizes patent cost once issued on a straight-line basis over the estimate useful lives of the patents. The Company assess the potential impairment to all capitalized patent cost when events or changes in circumstances indicate that the carrying amount of our patent may not be recoverable.
Basic and diluted Net Loss Per Share	Basic and diluted Net Loss Per Share Basic and diluted net loss per share has been computed by dividing net loss by the weighted average number of common shares outstanding during the period. All potentially dilutive common shares have been excluded since their inclusion would be anti-dilutive. An aggregate of 1,597,969 and 0 warrants were excluded from the computation of diluted net loss per common share for the three and six months ended June 30, 2013 and 2012 because to do so would have an anti-dilutive effect for the periods presented. An aggregate of 120,000 and 0 stock options were excluded from the computation of diluted net loss per common share for the three and six months ended June 30, 2013 and 2012 because they were contingent options subject to recall and to do so would have an anti-dilutive effect for the periods presented. An aggregate of 231,493 and 1,973,142 common stock equivalents (incentive shares) were excluded from the computation of diluted net loss per common share for the three and six months ended June 30, 2013 and 2012 because they were contingent shares subject to recall.
Derivative Instruments	Derivative Instruments The Company does not use derivative instruments to hedge exposures to cash flow, market or foreign currency risks. The Company evaluates all of its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then revalued at each reporting date, with changes in the fair value reported in the statements of operations. For stock-based derivative financial instruments, the Company calculates the fair value of the financial instruments using a probability-weighted Black-Scholes option pricing model, which is comparable to the Binomial Lattice options pricing model at inception and on each subsequent valuation date. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. (See Note 5 and Note 6).
Joint and Several Liability Assessment	The Company measures obligations resulting from joint and several liability arrangements as the sum of the amount that the Company has (a) contractually agreed to pay, and (b) any additional amounts that the Company expects to pay on behalf of its co-obligors.
Financial Instruments and Fair Value	Financial Instruments and Fair Value ASC Topic 820, “Fair Value Measurements and Disclosures,” (“ASC Topic 820”) establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under ASC Topic 820 are described below: Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; Level 2 – Quoted prices in markets that are not active or financial instruments for which all significant inputs are observable, either directly or indirectly; and Level 3 – Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable. In estimating the fair value of the Company’s derivative liabilities, the Company used a probability-weighted Black-Scholes option pricing model. (See Note 5 and Note 6). Financial assets with carrying values approximating fair value include cash and cash equivalents as well as prepaid expenses and other current assets. Financial liabilities with carrying values approximating fair value include accounts payable and other accrued liabilities.
Registration Payment Arrangement	The Company accounted for registration rights agreements in accordance with ASC 825-20, “Registration Payment Arrangements.” ASC 825-20 addresses an issuer’s accounting for registration payment arrangements. This pronouncement specifies that the contingent obligation to make future payments or otherwise transfer consideration under a registration payment arrangement, whether issued as a separate agreement or included as a provision of a financial instrument, should be separately recognized and accounted for as a contingency in accordance with ASC 450-20 “Loss Contingencies”.
Subsequent Events	Subsequent Events The Company follows the provisions of ASC Topic 855-10, “Subsequent Events,” relating to subsequent events. This guidance establishes principles and requirements for subsequent events. This guidance defines the period after the balance sheet date during which events or transactions that may occur would be required to be disclosed in a company’s financial statements. The Company has evaluated subsequent events up to the date of issuance of this report.
Recently Issued Accounting Pronouncements	Recently Issued Accounting Pronouncements In February 2013, the FASB issued Accounting Standards Updated (“ASU”) 2013-04 “Obligations Resulting from Joint and Several Liability Arrangements for Which the Amount at the Reporting Date is Fixed”) (“ASU 2013-04”). The guidance in this update is effective for fiscal years beginning after December 15, 2013 with early adoption permitted. The guidance in this update requires companies to measure obligations resulting from joint and several liability arrangements as the sum of the amount the entity has (a) contractually agreed to pay, and (b) any additional amounts that the entity expects to pay on behalf of its co-obligors. The Company early adopted this guidance in the second quarter of 2013 (Note 9 and Note 13). Except as noted above, management does not believe that any recently issued, but not yet effective accounting pronouncements, if adopted, would have a significant effect on the accompanying consolidated financial statements.

5. DERIVATIVE FINANCIAL INSTRUMENTS (Tables)

6 Months Ended

Jun. 30, 2013

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Assumptions used

	As of
		Date of issuance	30-Jun-13
		14-Feb-13
Fair market price of common stock		$3.75	$5.50
Expected option term		5 years	4.63 years
Risk-free interest rate		0.86%	1.41%
Expected volatility		101%	98.59%

6. FAIR VALUE MEASUREMENTS (Tables)

6 Months Ended

Jun. 30, 2013

Fair Value Disclosures [Abstract]

Fair value on a recurring basis

		Fair Value Measurements at June 30, 2013
	Total carrying value at June 30, 2013	Quoted prices in active markets (Level 1)	Significant other observable inputs (Level 2)	Significant unobservable inputs (Level 3)

Derivative liabilities related to warrants	$ 6,901,223	$ -	$ -	$ 6,901,223

Summary of changes in the estimated fair value of the Company’s Level 3 liability

	Fair Value Measurements of Common Stock Warrants Using Significant Unobservable Inputs (Level 3)
Balance at December 31, 2012	$ -
Issuance of common stock warrants	4,505,605
Change in fair value of common stock warrant liability	2,395,618
Balance at June 30, 2013	$ 6,901,223

11. INCENTIVE SHARES (Tables)

6 Months Ended

Jun. 30, 2013

Incentive Shares Tables

Schedule of incentive shares

	Employee - number of shares		Non Employee - number of shares		Total number of shares		Weighted Average Fair Value

Unvested December 31, 2011	1,281,225		321,165		1,602,390		$	4.00
Granted	866,180		87,503		953,683			12.89
Vested	(2,048,280	)	(193,672	)	(2,241,952	)		7.34
Forfeited	(46,353	)	-		(46,353)	)		9.06
Unvested December 31, 2012	52,772		214,996		267,768			5.79
Granted	120,000		12,500		132,500			6.17
Vested	(11,112)		(64,748)		(75,860)			7.04
Forfeited	(20,833)		(72,082)		(92,915)			4.00
Unvested June 30, 2013	140,827		90,666		231,493		$	4.82

3. LIQUIDITY AND FINANCIAL CONDITION AND MANAGEMENT'S PLANS (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended		10 Months Ended	12 Months Ended	28 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Dec. 31, 2011	Dec. 31, 2012	Jun. 30, 2013
Liquidity And Financial Condition And Managements Plans Details Narrative
Net loss	$ (5,048,513)	$ (4,760,179)	$ (9,791,435)	$ (8,332,212)	$ (3,268,256)	$ (30,343,856)	$ (43,403,547)
Stock-based compensation (Approximately)							25,000,000
Cash	286,514		286,514			11,388	286,514
Working Capital (Approximately)	10,700,000		10,700,000				10,700,000
Accumulated deficit	$ 43,403,547		$ 43,403,547			$ 33,612,112	$ 43,403,547

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Net Income
-URI http://asc.fasb.org/extlink&oid=6518256

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 230
-SubTopic 10
-Section 45
-Paragraph 28
-URI http://asc.fasb.org/extlink&oid=31042434&loc=d3e3602-108585

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 225
-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-04.19)
-URI http://asc.fasb.org/extlink&oid=6879464&loc=d3e573970-122913

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6371337&loc=d3e3550-109257

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 225
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SX 210.5-03.18)
-URI http://asc.fasb.org/extlink&oid=26872669&loc=d3e20235-122688

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 225
-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-04.22)
-URI http://asc.fasb.org/extlink&oid=6879464&loc=d3e573970-122913

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Other Comprehensive Income
-URI http://asc.fasb.org/extlink&oid=6519514

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section 45
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=28358780&loc=d3e565-108580

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 03
-Paragraph 19
-Article 5

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 04
-Paragraph 20
-Article 9

+ Details

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended		28 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013
Summary Of Significant Accounting Policies Details Narrative
Research and development costs	$ 605,203	$ 141,962	$ 713,937	$ 176,233	$ 1,608,451

5. DERIVATIVE FINANCIAL INSTRUMENTS (Details) - $ / shares	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Derivative Financial Instruments Details
Fair market price of common stock	$ 3.75	$ 5.5
Expected option term	5 years	4 years 7 months 17 days
Risk-free interest rate	0.86%	1.41%
Expected volatility	101.00%	98.59%

6. FAIR VALUE MEASUREMENTS (Details) - USD ($)	Jun. 30, 2013	Dec. 31, 2012
Derivative financial instruments, at estimated fair value	$ 6,901,223
Significant unobservable inputs (Level 3)
Derivative financial instruments, at estimated fair value	$ 6,901,223

6. FAIR VALUE MEASUREMENTS (Details 2) - USD ($)	3 Months Ended		6 Months Ended		28 Months Ended
6. FAIR VALUE MEASUREMENTS (Details 2) - USD ($)	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013
Fair Value Measurements Details 2
Balance at December 31, 2012
Issuance of common stock warrants			4,505,605
Change in fair value of common stock warrant liability	$ (56,041)		2,395,618		$ 2,395,618
Balance at June 30, 2013	$ 6,901,223		$ 6,901,223		$ 6,901,223

7. LICENSE AGREEMENT (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended		28 Months Ended
7. LICENSE AGREEMENT (Details Narrative) - USD ($)	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013
License Agreement Details Narrative
License agreement	$ 2,300,000		$ 2,300,000		$ 2,300,000
Amortization expense of the license	$ 50,511	$ 36,581	$ 100,466	$ 36,581	$ 221,849

8. NOTES PAYABLE (Detail Narrative) - USD ($)	3 Months Ended		6 Months Ended		28 Months Ended
8. NOTES PAYABLE (Detail Narrative) - USD ($)	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013
Notes Payable Detail Narrative
Repayment of note payable - related party			$ 884,764		$ 930,000
Repayment of accrued interest - related party			90,650
Interest expense		$ 26,471	$ 41,563	$ 43,798	$ 147,480

11. INCENTIVE SHARES (Details) - $ / shares	6 Months Ended
11. INCENTIVE SHARES (Details) - $ / shares	Jun. 30, 2013	Jun. 30, 2012
Number of stock Unvested Outstanding, Beginning	267,768	1,602,390
Number of Options Granted	132,500	953,683
Stock vested	(75,860)	(2,241,952)
Number of Options Forfeited	(92,915)	(46,353)
Number of stock Unvested Outstanding, Ending	231,493	267,768
Weighted Average Fair Value Outstanding, Beginning	$ 5.79	$ 4
Weighted Average Fair Value Granted	6.17	12.89
Weighted Average Fair Value, stock vested	7.04	7.34
Weighted Average Fair Value Forfeited	4.00	9.06
Weighted Average Fair Value Outstanding, Ending	$ 4.82	$ 5.79
Employee
Number of stock Unvested Outstanding, Beginning	52,772	1,281,225
Number of Options Granted	120,000	866,180
Stock vested	(11,112)	(2,048,280)
Number of Options Forfeited	(20,833)	(46,353)
Number of stock Unvested Outstanding, Ending	140,827	52,772
Non Employee
Number of stock Unvested Outstanding, Beginning	214,996	321,165
Number of Options Granted	12,500	87,503
Stock vested	(64,748)	(193,672)
Number of Options Forfeited	(72,082)	0
Number of stock Unvested Outstanding, Ending	90,666	214,996