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Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2014	Nov. 12, 2014
Document And Entity Information
Entity Registrant Name	Retrophin, Inc.
Entity Central Index Key	0001438533
Trading Symbol	rtrx
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		26,699,847
Document Type	10-Q
Document Period End Date	Sep. 30, 2014
Amendment Flag	false
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q3

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Sep. 30, 2014	Dec. 31, 2013
Current assets:
Cash	$ 25,861,729	$ 5,997,307
Marketable securities	11,930,492	132,994
Accounts receivable	4,676,688
Inventory, net	683,565
Prepaid expenses and other current assets	2,292,085	1,370,943
Total current assets	45,444,559	7,501,244
Property and equipment, net	633,167	127,427
Security deposits	337,014	244,058
Restricted cash	40,000	40,000
Other asset	1,921,265
Investment	400,000
Intangible assets, net	96,219,940	12,586,150
Goodwill	935,935
Total assets	145,931,880	20,498,879
Current liabilities:
Deferred technology purchase liability, current portion	1,500,000	1,634,630
Accounts payable	11,285,010	3,553,567
Accrued expenses	11,692,302	3,526,434
Securities sold, not yet purchased	3,150,413	1,457,901
Other liability	774,067
Acquisition-related contingent consideration, less current portion	2,253,075
Derivative financial instruments, warrants	18,480,000	25,037,346
Total current liabilities	49,134,867	35,209,878
Note payable	40,160,206
Convertible debt	43,132,928
Other liability	12,565,722
Acquisition-related contingent consideration, less current portion	9,984,855
Deferred technology purchase liability, less current portion	1,000,000	1,000,000
Deferred income tax liability, net	141,151	2,600,899
Total liabilities	156,119,729	38,810,777
Commitments and contingencies
Stockholders' Deficit:
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; 26,699,847 and 18,546,363 issued and 26,320,256 and 18,415,573 outstanding, respectively	2,670	1,855
Additional paid-in capital	138,414,487	50,189,127
Treasury stock, at cost, 379,591 and 130,790, respectively	(3,214,608)	(957,272)
Accumulated deficit	(149,134,700)	(67,435,621)
Accumulated other comprehensive income (loss)	3,744,302	(109,987)
Total stockholders' deficit	(10,187,849)	(18,311,898)
Total liabilities and stockholders' deficit	$ 145,931,880	$ 20,498,879

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Sep. 30, 2014	Dec. 31, 2013
Stockholders' Deficit:
Preferred series A, par value	$ 0.001	$ 0.001
Preferred stock, shares 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 (in dollars per share)	$ 0.0001	$ 0.0001
Common stock shares authorized	100,000,000	100,000,000
Common stock shares issued	26,699,847	18,546,363
Common stock shares outstanding	26,320,256	18,415,573
Treasury stock shares (In shares)	379,591	130,790

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Income Statement [Abstract]
Net product sales	$ 8,348,583		$ 14,118,217
Operating expenses:
Cost of goods sold	197,411		233,271
Research and development	13,018,729	$ 1,399,875	33,603,446	$ 2,113,813
Selling, general and administrative	18,575,982	3,754,611	41,180,510	10,391,061
Total operating expenses	31,792,122	5,154,486	75,017,227	12,504,874
Operating loss	(23,443,539)	(5,154,486)	(60,899,010)	(12,504,874)
Other income (expenses):
Interest income (expense), net	(2,629,101)	4	(4,807,502)	(41,554)
Finance expense	(12,500)		(4,720,780)
Realized gain on sale of marketable securities, net	168,943	59,737	543,784	59,737
Change in fair value of derivative instruments - gain (loss)	6,359,144	(5,803,054)	(14,276,072)	(8,198,672)
Gain (loss) on transactions denominated in foreign currencies	753		753	(3,873)
Total other income (expense), net	3,887,239	(5,743,313)	(23,259,817)	(8,184,362)
Loss before provision for income taxes	(19,556,300)	(10,897,799)	(84,158,827)	(20,689,236)
Income tax benefit			2,459,748
Net loss	$ (19,556,300)	$ (10,897,799)	$ (81,699,079)	$ (20,689,236)
Net loss per common share, basic	$ (0.73)	$ (0.71)	$ (3.24)	$ (1.62)
Net loss per common share, diluted	$ (0.89)	$ (0.71)	$ (3.24)	$ (1.62)
Weighted average common shares outstanding, basic	26,682,510	15,365,631	25,229,847	12,797,714
Weighted average common shares outstanding, diluted	28,210,225	15,365,631	25,229,847	12,797,714
Comprehensive Loss:
Net loss	$ (19,556,300)	$ (10,897,799)	$ (81,699,079)	$ (20,689,236)
Unrealized gain (loss) on sale of marketable securities	3,232,213	(154,834)	3,854,289	(154,834)
Comprehensive loss	$ (16,324,087)	$ (11,052,633)	$ (77,844,790)	$ (20,844,070)

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' DEFICIT (Unaudited) - 9 months ended Sep. 30, 2014 - USD ($)	Common Stock	Common Stock In Treasury	Additional Paid-In Capital	Accumulated other comprehensive loss	Accumulated Deficit	Total
Beginning Balance, Shares at Dec. 31, 2013	18,546,363	(130,790)
Beginning Balance, Amount at Dec. 31, 2013	$ 1,855	$ (957,272)	$ 50,189,127	$ (109,987)	$ (67,435,621)	$ (18,311,898)
Share based compensation	$ 108		14,708,993			14,709,101
Share based compensation, shares	1,084,178
Issuance of common stock in connection with January 2014 public offering at $8.5 per share, net of fees of $3,164,990	$ 471		36,834,536			36,835,007
Issuance of common stock in connection with January 2014 public offering at $8.5 per share, net of fees of $3,164,990, shares	4,705,882
Exercise of warrants and reclassification of the derivative liability	$ 196		31,701,852			31,702,048
Exercise of warrants and reclassification of the derivative liability, shares	1,962,377
Adjustment in connection with August 2013 private placement			271,739			271,739
Treasury stock		$ (2,257,336)				(2,257,336)
Treasury stock, shares		(248,801)
Issuance of common stock to convertible debt holders	$ 40		4,708,240			4,708,280
Issuance of common stock to convertible debt holders, shares	401,047
Unrealized gain (loss) on sale of marketable securities				3,854,289		3,854,289
Net loss					(81,699,079)	(81,699,079)
Ending Balance, Shares at Sep. 30, 2014	26,699,847	(379,591)
Ending Balance, Amount at Sep. 30, 2014	$ 2,670	$ (3,214,608)	$ 138,414,487	$ 3,744,302	$ (149,134,700)	$ (10,187,849)

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' DEFICIT (Parentheticals)	Jan. 09, 2014 USD ($) $ / shares
Statement of Stockholders' Equity [Abstract]
Common stock issued price per share of January 2014 public offering \| $ / shares	$ 8.50
Underwriting fees and other offering costs \| $	$ 3,164,990

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Cash Flows From Operating Activities:
Net loss	$ (81,699,079)	$ (20,689,236)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	3,542,809	159,128
Realized gain on marketable securities	(543,784)	(59,737)
Amortization of deferred financing costs	36,733
Amortization of debt discount	534,005
Share based compensation	14,709,101	2,029,505
Change in estimated fair value of liability classified warrants	14,276,072	8,198,672
Non-cash financing cost	4,708,280
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable	(4,676,688)
Inventory	(165,560)
Settlement payable		1,691,400
Prepaid expenses and other assets	(1,241,595)	(458,817)
Accounts payable and accrued expenses	13,764,403	(313,357)
Net cash used in operating activities	(36,755,303)	(9,442,442)
Cash Flows From Investing Activities:
Purchase of fixed assets	(581,158)	(22,243)
Purchase of intangible asset	(3,301,534)	(5,700)
Payments for security deposits for exclusivity of certain licenses		(2,250,000)
Repayment of technology license liability		(1,300,000)
Security deposits	(92,956)	(40,000)
Proceeds from the sale of marketable securities	2,251,571	377,945
Purchase of marketable securities	(10,148,642)	(3,430,418)
Proceeds from securities sold, not yet purchased	7,499,946
Cover securities sold, not yet purchased	(5,309,791)
Cash paid for investment	(400,000)
Cash paid upon acquisition, net of cash acquired	(29,150,000)
Net cash used in investing activities	(39,232,564)	(6,670,416)
Cash Flows From Financing Activities:
Repayment of net amounts due to related parties		(13,200)
Repayment of note payable - related party		(884,764)
Payment of acquisition-related contingent consideration	(562,071)
Repayment of other liability	(31,921)
Proceeds from Credit Agreement	42,366,210
Proceeds from Note Purchase Agreement	42,924,169
Proceeds from the exercise of warrants	8,337,380
Proceeds received from issuance of common stock, net	36,835,007	31,355,455
Payment to investors that participated in August 2013 financing	(475,000)	(946,196)
Repayment of Manchester Note payable	(31,282,972)
Purchase of treasury stock, at cost	(2,257,336)
Net cash provided by financing activities	95,853,466	29,511,295
Effect of exchange rate on cash	(1,177)
Net increase in cash	19,864,422	13,398,437
Cash, beginning of year	5,997,307	11,388
Cash, end of period	25,861,729	13,409,825
Supplemental Disclosure of Cash Flow Information:
Cash paid for interest	3,114,110	28,263
Non-cash investing and financing activities:
Reclassification of derivative liability to equity due to exercise of warrants	23,364,668
Present value of contingent consideration payable to sellers of Manchester Pharmaceuticals LLC	12,237,930
Present value of guaranteed minimum royalty payable to sellers of Thiola	11,817,727
Note payable entered into upon consummation of Manchester Pharmaceuticals LLC	31,282,972
Unrealized gain on marketable securities	3,701,143	(154,834)
Unrealized gain on securities sold, not yet purchased	$ 34,159
Allocation of proceeds from issuance of common stock to registration payment obligation		360,000
Share issued on behalf of related party		$ 44,400

DESCRIPTION OF BUSINESS

9 Months Ended

Sep. 30, 2014

Notes to Financial Statements

1. DESCRIPTION OF BUSINESS

NOTE 1. DESCRIPTION OF BUSINESS

Organization and Description of Business

Retrophin, Inc. and its subsidiaries (the “Company”) is a fully integrated biopharmaceutical company focused on the development, acquisition and commercialization of therapies for the treatment of serious, catastrophic or rare diseases.

Acquisition of Manchester Pharmaceuticals LLC

On March 26, 2014, the Company completed its acquisition of all of the membership interests of Manchester Pharmaceuticals LLC, a privately-held specialty pharmaceutical company that focuses on treatments for rare diseases. The acquisition expanded the Company’s ability to address the special needs of patients with rare diseases.

Thiola^®License

On May 29, 2014, the Company entered into a license agreement with Mission Pharmacal Company (“Mission”), a privately-held healthcare medications and treatments provider, for the U.S. marketing rights to Thiola. The license added Thiola to the Company’s product line. In July 2014, the Company amended the license agreement with Mission to secure the Canadian marketing rights to the product.

As of September 30, 2014, the Company sells the following three products:

Chenodal^®, which is available in the United States for the treatment of patients suffering from gallstones in whom surgery poses an unacceptable health risk due to disease or advanced age.

Vecamyl^®, which is available in the United States for the treatment of moderately severe to severe essential hypertension and uncomplicated cases of malignant hypertension.

Thiola, which is available in the United States for the prevention of cysteine (kidney) stone formation in patients with severe homozygous cystinuria.

The Company is developing RE-024, a novel small molecule, as a potential treatment for pantothenate kinase-associated neurodegeneration (“PKAN”). Certain European and South American health regulators have approved the initiation of dosing RE-024 in PKAN under a physician initiated studies and the Company intends to file a U.S. Investigational New Drug (“IND”) Application in fiscal 2015. Also, the Company is developing Sparsentan, formerly known as RE-021, a dual acting receptor antagonist of angiotensin and endothelin receptors, for the treatment of focal segmental glomerulosclerosis (“FSGS”). In addition, the Company is developing RE-034, a synthetic hormone analogue that is composed of the first 24 amino acids of the 39 amino acids contained in Adrenocorticotropic hormone (“ACTH”) for the treatment of Infantile Spasms (“IS”), and Nephrotic Syndrome (“NS”). The Company also has additional programs in preclinical development. We are currently exploring options relating to the future development of RE-034.

On October 13, 2014, the Company signed a Letter of Intent on the terms for the sale of the Company’s Vecamyl, Syntocinon and ketamine licenses and assets to Turing Pharmaceuticals. The closing is subject to various conditions, including the negotiation and execution of a binding definitive agreement between the Company and Turing Pharmaceuticals and the receipt of necessary third party consents, and is expected to occur by the end of the first quarter of fiscal 2015 (see Note 13).

BASIS OF PRESENTATION

9 Months Ended

Sep. 30, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

2. BASIS OF PRESENTATION

NOTE 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 for the year ended December 31, 2013 (the “2013 10-K”) filed with the Securities and Exchange Commission (the “SEC”) on March 28, 2014. 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, 2013 balance sheet information was derived from the audited financial statements as of that date.

LIQUIDITY AND FINANCIAL CONDITION AND MANAGEMENT'S PLANS

9 Months Ended

Sep. 30, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

3. LIQUIDITY AND FINANCIAL CONDITION AND MANAGEMENT'S PLANS

NOTE 3. LIQUIDITY AND FINANCIAL CONDITION AND MANAGEMENT’S PLANS

The Company incurred a net loss of approximately $81.7 million, which includes a charge for the change in fair value of derivative instruments in the amount of $14.3 million, for the nine months ended September 30, 2014. At September 30, 2014, the Company had a cash balance of approximately $25.9 million and a working capital deficit of approximately $3.7 million. The Company’s accumulated deficit amounted to approximately $149.1 million as of September 30, 2014.

The Company has principally financed its operations from inception using proceeds from sales of its equity securities in a series of private placement transactions and the issuance of debt. On January 9, 2014, the Company completed a public offering of 4,705,882 shares of common stock at a price of $8.50 per share. The Company received net proceeds from the offering of approximately $36.8 million, after deducting the underwriting fees and other offering costs.

On May 29, 2014, the Company entered into a Note Purchase Agreement (the “Note Purchase Agreement”) relating to the private placement of $46 million aggregate principal senior convertible notes with an interest rate of 4.50% due 2019 (the “Notes”). The Company received net proceeds from the sale of the Notes of approximately $43.0 million.

On June 30, 2014, the Company entered into a $45 million Credit Agreement (the “Credit Agreement”) which matures on June 30, 2018 and bears interest at an annual rate of (i) the Adjusted LIBOR Rate plus 10% or (ii) in certain circumstances, the Base Rate (as such term defined in the Credit Agreement) plus 9%. The Company received net proceeds from the Credit Agreement of approximately $42.4 million.

On June 30, 2014, the Company made the final payment of $33 million to the sellers of Manchester Pharmaceuticals LLC (“Manchester”) in full satisfaction of the outstanding amount owed for the acquisition of all membership interest of Manchester (see Note 5).

On October 13, 2014, the Company signed a Letter of Intent on the terms of the sale of the Company’s Vecamyl, Syntocinon and ketamine licenses and assets to Turing Pharmaceuticals, which include an up-front payment to the Company of $3 million and the assumption of certain liabilities, including license fees and royalties (see Note 13).

Management believes the Company’s ability to continue its operations depends on its results of operations and continued financings. Management believes that the Company will continue to incur losses for the immediate future. For the nine months ended September 30, 2014, the Company has generated revenue and is trying to achieve positive cash flow from operations. The Company’s future depends on the costs, timing, and outcome of regulatory reviews of its product candidates, ongoing research and development, the funding of planned or potential acquisitions, other planned operating activities, and the costs of commercialization activities, including ongoing, product marketing, sales and distribution. The Company expects to finance its cash needs from results of operations and depending on the results of operations, the Company may need additional private and public 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.

These conditions raise substantial doubt about the Company’s ability to continue as a going concern. These unaudited 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.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

9 Months Ended

Sep. 30, 2014

Accounting Policies [Abstract]

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 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 unaudited condensed consolidated financial statements represent the consolidation of the accounts of the Company and its subsidiaries in conformity with GAAP. All intercompany accounts and transactions have been eliminated in consolidation.

Reclassifications

Certain reclassifications have been made to prior period amounts to conform with the current period presentation.

Accounts Receivable – Trade

The Company's trade accounts receivable represents amounts due from customers. The Company monitors the financial performance and credit worthiness of its customers so that it can properly assess and respond to changes in their credit profile. The Company provides reserves against trade receivables for estimated losses that may result from a customer's inability to pay. Amounts determined to be uncollectible are written-off against the reserve.

Inventory

Inventory is stated at the lower of cost or estimated realizable value. The Company determines the cost of inventory using the first-in, first-out, or FIFO, method. The Company periodically analyzes its inventory levels to identify inventory that may expire prior to expected sale or has a cost basis in excess of its estimated realizable value, and write down such inventory as appropriate. In addition, the Company's products are subject to strict quality control and monitoring which the Company’s manufacturers perform throughout their manufacturing process.

Inventory consists of the following at September 30, 2014:

	September 30, 2014
Raw material	$	314,625
Finished goods		368,940
Total inventory	$	683,565

Income Taxes

The Company follows Financial Accounting Standard Board (“FASB”) ASC 740, Income Taxes, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the asset will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

The standard addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under FASB ASC 740, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the tax authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. FASB ASC 740 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. As of September 30, 2014 and December 31, 2013, the Company had $1.5 million and $0, respectively, recorded as a liability for unrecognized tax uncertainties, included in other liability-long term in the condensed consolidated balance sheet.

Revenue Recognition

Product sales as of September 30, 2014 consisted of U.S. sales of Chenodal, Vecamyl, and Thiola. Revenue from product sales is recognized when persuasive evidence of an arrangement exists, title to product and associated risk of loss have passed to the customer, the price is fixed or determinable, collection from the customer is reasonably assured, the Company has no further performance obligations, and returns can be reasonably estimated. The Company records revenue from product sales upon delivery to its customers. The Company sells Chenodal and Vecamyl in the United States to a specialty pharmacy. Under this distribution model, the specialty pharmacy takes title of the inventory FOB shipping point and sells directly to patients. The Company sells Thiola in the United States and Canada through a specialty distributor. Under this model, the Company will record revenues once the distributor ships products to customers and such customers take title of the inventory FOB shipping point.

Government Rebates and Chargebacks: The Company estimates reductions to product sales for Medicaid programs, and for certain other qualifying federal and state government programs. Based upon the Company's contracts with government agencies, statutorily-defined discounts applicable to government-funded programs, historical experience, and estimated payer mix, the Company estimates and records an allowance for rebates and chargebacks as a reduction in sales. The Company's liability for Medicaid rebates consists of estimates for claims that a state will make for a current quarter, claims for prior quarters that have been estimated for which an invoice has not been received, and invoices received for claims from prior quarters that have not been paid. The Company's customers charge the Company for the difference between what they pay for the products and the ultimate selling price.

Distribution-Related Fees: The Company has written contracts with its customers that include terms for distribution-related fees. The Company estimates and records distribution and related fees due to its customer based on gross sales. The Company records fees paid to distributors as a reduction of revenue.

Prompt Pay Discounts: The Company offers discounts to its customers for prompt payments. The Company estimates these discounts based on customer terms and historical experience, and expect that its customers will always take advantage of this discount. Therefore, the Company accrues 100% of the prompt pay discount that is based on the gross amount of each invoice, at the time of sale.

Product Returns: Consistent with industry practice, the Company offers its customers a limited right to return product purchased directly from the Company, which is principally based upon the product's expiration date. Product returned is generally not resalable given the nature of the Company's products and method of administration. The Company develops estimates for product returns based upon historical experience, inventory levels in the distribution channel, shelf life of the product, and other relevant factors. The Company monitors product supply levels in the distribution channel, as well as sales by its customers to patients using product-specific data provided by its customers. If necessary, the Company's estimates of product returns may be adjusted in the future based on actual returns experience, known or expected changes in the marketplace, or other factors.

During the three and nine months ended September 30, 2014, one customer accounted for 97% of the Company’s revenues. As of September 30, 2014, this customer accounted for 100% of accounts receivable.

Loss per Share

The Company follows ASC 260, "Earnings per Share" ("EPS"), which requires presentation of basic and diluted EPS on the face of the income statement for all entities with complex capital structures, and requires a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS computation. In the accompanying financial statements, basic loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted EPS excluded all dilutive potential shares if their effect is anti-dilutive.

The following sets forth the computation of diluted EPS for the three months ended September 30, 2014:

	Three months ended September 30, 2014
	Net loss (Numerator)			Shares (Denominator)		Per Share Amount
Basic EPS	$	(19,556,300	)		26,682,510	$	(0.73	)
Change in fair value of derivative instruments		(5,689,144	)		-
Dilutive shares related to warrants		-			1,527,715
Dilutive EPS	$	(25,245,444	)		28,210,225	$	(0.89	)

Basic net loss per share is based on the weighted average number of common and common equivalent shares outstanding. Potential common shares includable in the computation of fully diluted per share results are not presented for the nine months ended September 30, 2014 and 2013 in the condensed consolidated financial statements as their effect would be anti-dilutive. The total number of shares issuable upon exercise of options that were not included in dilutive loss per share for the three and nine months ended September 30, 2014 were 2,852,500. The total number of shares issuable upon conversion of debt that were not included in dilutive earnings per share for the three and nine months ended September 30, 2014 were 2,642,160 and 3,106,345, respectively. The total number of shares issuable upon exercise of options that were not included in dilutive loss per share for the three and nine months ended September 30, 2013 were 120,000. The total number of shares issuable upon exercise of warrants that were not included in dilutive loss per share for the three andnine months ended September 30, 2014 were 337,500. The total number of shares issuable upon exercise of warrants that were not included in dilutive earnings per share for the three and nine months ended September 30, 2013 were 1,917,792.

Recently Issued Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, "Revenue from Contracts with Customers (Topic 606)," which is the new comprehensive revenue recognition standard that will supersede all existing revenue recognition guidance under GAAP. The standard's core principle is that a company will recognize revenue when it transfers promised goods or services to a customer in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. This ASU is effective for annual and interim periods beginning on or after December 15, 2016, and early adoption is not permitted. Companies will have the option of using either a full retrospective approach or a modified approach to adopt the guidance in the ASU. The Company is currently evaluating the impact of adopting this guidance.

In June 2014, the FASB issued ASU 2014-12, “Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period”. The guidance requires that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. As such, the performance target should not be reflected in estimating the grant date fair value of the award. The guidance will be effective for interim and annual periods beginning after December 15, 2015, with early adoption permitted. The Company does not expect the adoption to have a material impact on its consolidated financial statements.

In August 2014, the FASB issued Accounting Standards Update ASU No. 2014-15, “Presentation of Financial Statements-Going Concern“(Subtopic 205-40) Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, which requires management to evaluate, at each annual and interim reporting period, whether there are conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date the financial statements are issued and provide related disclosures. ASU 2014-15 is effective for annual periods ending after December 15, 2016 and interim periods thereafter. Early application is permitted. The adoption of ASU 2014-15 is not expected to have a material effect on the Company’s consolidated financial statements or disclosures.

BUSINESS COMBINATION

9 Months Ended

Sep. 30, 2014

Business Combinations [Abstract]

5. BUSINESS COMBINATION

Note 5. BUSINESS COMBINATION

Manchester Pharmaceuticals LLC

On March 26, 2014 (the “Manchester Closing Date”), the Company acquired 100% of the outstanding membership interests of Manchester. Under the terms of the agreement, the Company paid $29.5 million upon consummation of the transaction, of which $3.2 million was paid by Retrophin Therapeutics International LLC, a newly formed indirect wholly owned subsidiary, for rights of product sales outside of the United States. Acquisition costs amounted to approximately $0.3 million and have been recorded as selling, general, and administrative expense in the accompanying condensed consolidated financial statements. The Company entered into a promissory note with Manchester for $33 million which was discounted to $31.3 million to be paid in three equal installments of $11 million within three, six, and nine months after the Manchester Closing Date. On June 30, 2014, the Company paid the sellers of Manchester $33 million in full satisfaction of the outstanding amount owed.

In addition, the Company agreed to make contractual payments based on 10% of net sales of the products Chenodal and Vecamyl to the former members of Manchester. Additional contingent payments will be made based on 5% of net sales from new products derived from Chenodal and Vecamyl. Acquisition-related contingent consideration estimated at $12.8 million will be revalued at each reporting period and any change in valuation will be recorded in the Company’s statement of operations.

The acquisition was accounted for under the purchase method of accounting in accordance with ASC 805, with the excess purchase price over the fair market value of the assets acquired and liabilities assumed allocated to goodwill. Based on the preliminary purchase price allocation, the purchase price of $73.2 million has resulted in goodwill of $0.9 million and is primarily attributed to the synergies expected to arise after the acquisition. The $0.9 million of goodwill resulting from the acquisition is deductible for income tax purposes.

The fair value of assets acquired and liabilities assumed was based upon a preliminary valuation and the Company’s estimates and assumptions are subject to change within the measurement period. Critical estimates in valuing certain intangible assets include but are not limited to future expected cash flows from customer relationships and developed technology, present value and discount rates. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates.

The purchase included $72 million of intangible assets with definite lives related to product rights, trade names, and customer relationships with values of $71.4 million, $0.2 million, and $0.4 million, respectively. The useful lives related to the acquired product rights, trade names, and customer relationships are expected to be approximately 16, 1 and 10 years, respectively. Under the terms of the agreement, the sellers agreed to indemnify the Company for uncertain tax liabilities, any breach of any representation or warranty the sellers made to the purchaser, failure of the sellers to perform any covenants or obligations made to the purchaser, and third party claims relating to the operation of the Company and events occurring prior to the Manchester Closing Date. As of September 30, 2014, the Company has recorded an indemnification asset with a corresponding liability in the amount of $1.5 million related to uncertain tax liabilities.

The purchase price allocation of $73.2 million as of the Manchester Closing Date was as follows:

	Amount (in thousands)
Cash paid upon consummation, net	$	29,150
Secured promissory note		31,283
Fair value of acquisition-related contingent consideration		12,800
Total purchase price	$	73,233

Prepaid expenses		116
Inventory		517
Product rights		71,372
Trade names		175
Customer relationship		403
Goodwill		936
Other asset		1,522
Accounts payable and accrued expenses		(286	)
Other liability		(1,522	)
Total allocation of purchase price consideration	$	73,233

Pro Forma Operating Results

The following table provides unaudited pro forma results of operations for the three and nine months ended September 30, 2014 and 2013, as if the March 26, 2014 acquisition had occurred on January 1, 2013. The pro forma results of operations were prepared for comparative purposes only and do not purport to be indicative of what would have occurred had the acquisitions been made as of January 1, 2013 or of results that may occur in the future.

	Pro Forma (Unaudited)
	Three months ended September 30, (in thousands, except per share data)						Nine months ended September 30, (in thousands, except per share data)
	2014			2013			2014			2013
Net product sales	$	8,349		$	1,098		$	15,337		$	3,295
Net loss	$	(19,556	)	$	(10,033	)	$	(81,080	)	$	(18,096	)
Net loss per common share, basic	$	(0.73	)	$	(0.65	)	$	(3.21	)	$	(1.41	)

- Definition

The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable).

+ References

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-Name Accounting Standards Codification
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Reference 3: http://www.xbrl.org/2003/role/presentationRef
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Reference 4: http://www.xbrl.org/2003/role/presentationRef
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Reference 5: http://www.xbrl.org/2003/role/presentationRef
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Reference 6: http://www.xbrl.org/2003/role/presentationRef
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Reference 7: http://www.xbrl.org/2003/role/presentationRef
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+ Details

MARKETABLE SECURITIES AND SECURITIES SOLD, NOT YET PURCHASED

9 Months Ended

Sep. 30, 2014

Investments, Debt and Equity Securities [Abstract]

6. MARKETABLE SECURITIES AND SECURITIES SOLD, NOT YET PURCHASED

NOTE 6. MARKETABLE SECURITIES AND SECURITIES SOLD, NOT YET PURCHASED

The Company measures marketable securities and securities sold, not yet purchased on a recurring basis. Generally, the types of securities the Company invests in are traded on a market such as the NASDAQ Global Market, which the Company considers to be Level 1 measurements.

Marketable securities and securities sold, not yet purchased at September 30, 2014 consisted of the following:

	Cost		Unrealized Gains		Unrealized Losses		Estimated Fair Value

Marketable securities available-for-sale:	$	8,220,349	$	3,732,622	$	22,479	$	11,930,492
Securities sold, not yet purchased	$	3,184,572	$	47,035	$	12,876	$	3,150,413

Marketable securities and securities sold, not yet purchased at December 31, 2013 consisted of the following:

	Cost		Unrealized Gains		Unrealized Losses		Estimated Fair Value

Marketable securities available-for-sale:	$	129,702	$	3,292	$	-	$	132,994
Securities sold, not yet purchased	$	1,344,622	$	13,256	$	126,535	$	1,457,901

- Definition

The entire disclosure for investments in certain debt and equity securities.

+ References + Details

DERIVATIVE FINANCIAL INSTRUMENTS

9 Months Ended

Sep. 30, 2014

Derivative Instrument Detail [Abstract]

7. DERIVATIVE FINANCIAL INSTRUMENTS

NOTE 7. DERIVATIVE FINANCIAL INSTRUMENTS

The Company accounts for derivative financial instruments in accordance with ASC 815-40, “Derivative and Hedging – Contracts in Entity’s Own Equity” (“ASC 815-40”), instruments which do not have fixed settlement provisions are deemed to be derivative instruments. The Company’s warrants are classified as liability instruments due to an anti-dilution provision that provides for a reduction to the exercise price of the warrants if the Company issues additional equity or equity linked 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 accompanying condensed consolidated statements of operations. The Company recorded a gain on a change in the estimated fair value of warrants of $6.4 million and a loss on a change in the estimated fair value of warrants of $5.8 million during the three months ended September 30, 2014 and 2013, respectively. The Company recorded a loss on a change in the estimated fair value of warrants of $14.3 million and $8.2 million during the nine months ended September 30, 2014 and 2013, respectively.

The Company calculated the fair value of the warrants using the Binomial Lattice options pricing model at inception and on each subsequent valuation date. The assumptions used at September 30, 2014 and December 31, 2013 are as follows:

	As of
	September 30, 2014		December 31, 2013
Fair value of common stock		$9.02		$7.00
Expected life (in years), represents the weighted average period until next liquidity event		.75 – 1.00 years		4.12-4.62 years
Risk-free interest rate		1.2% - 1.69%		1.39%
Expected volatility		85%		93-97%
Dividend yield		0.00%		0.00%

Expected volatility is based on analysis of the Company’s volatility, as well as the volatilities of guideline companies. 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.

FAIR VALUE MEASUREMENTS

9 Months Ended

Sep. 30, 2014

Fair Value Disclosures [Abstract]

8. FAIR VALUE MEASUREMENTS

NOTE 8. FAIR VALUE MEASUREMENTS

Financial Instruments and Fair Value

The Company accounts for financial instruments in accordance with ASC 820, “Fair Value Measurements and Disclosures” (“ASC 820”). ASC 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 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 marketable securities available-for-sale and securities sold, not yet purchased, the Company used quoted prices in active markets (see Note 6).

In estimating the fair value of the Company’s derivative liabilities, the Company used the Binomial Lattice options pricing model at inception and on each subsequent valuation date (see Note 7).

In estimating the fair value of the Company’s contingent consideration, the Company used the comparable uncontrolled transaction (“CUT”) method for royalty payments based on projected revenues. Based on the fair value hierarchy, the Company classified contingent consideration within Level 3 because valuation inputs are based on projected revenues discounted to a present value.

Financial instruments with carrying values approximating fair value include cash, accounts receivable, deposits on license agreements, and accounts payable.

The following table presents the Company’s asset and liabilities that are measured and recognized at fair value on a recurring basis classified under the appropriate level of the fair value hierarchy as of September 30, 2014:

	As of September 30, 2014		Fair Value Hierarchy at September 30, 2014
	Total carrying and estimated fair value		Quoted prices in active markets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Asset:
Marketable securities, available-for-sale	$	11,930,492	$	11,930,492	$	-	$	-

Liabilities:

Derivative liability related to warrants	$	18,480,000	$	-	$	-	$	18,480,000
Securities sold, not yet purchased	$	3,150,413	$	3,150,413	$	-	$	-
Acquisition-related contingent consideration	$	12,237,930	$	-	$	-	$	12,237,930

	As of December 31, 2013		Fair Value Hierarchy at December 31, 2013
	Total carrying and estimated fair value		Quoted prices in active markets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)

Asset:
Marketable securities, available-for-sale	$	132,994	$	132,994	$	-	$	-

Liability:
Derivative liability related to warrants	$	25,037,346	$	-	$	-	$	25,037,346
Securities sold, not yet purchased	$	1,457,901	$	1,457,901	$	-	$	-

The following table sets forth a summary of changes in the estimated fair value of the Company’s derivative financial instruments, warrants liability for the period from January 1, 2014 through September 30, 2014:

	Fair Value Measurements of Common Stock Warrants Using Significant Unobservable Inputs (Level 3)
Balance at December 31, 2013	$	25,037,346
Issuance of common stock warrants, September 30, 2014 (see Note 10)		2,531,250
Reclassification of derivative liability to equity upon exercise of warrants		(23,364,668	)
Change in estimated fair value of liability classified warrants		14,276,072
Balance at September 30, 2014	$	18,480,000

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 820.

The following table sets forth a summary of changes in the estimated acquisition-related contingent consideration for the period from January 1, 2014 through September 30, 2014:

	Fair Value Measurements of Acquisition-Related Contingent Consideration
Balance at January 1, 2014	$	-
Present value of contractual payments, contingent consideration upon acquisition		12,800,000
Contractual Payments		(562,070	)
Balance at September 30, 2014	$	12,237,930

- 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

INTANGIBLE ASSETS

9 Months Ended

Sep. 30, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

9. INTANGIBLE ASSETS

NOTE 9. INTANGIBLE ASSETS

Amortizable intangible assets

Ligand License Agreement

On February 16, 2012, the Company entered into an agreement for a worldwide sublicense for $2.5 million to develop, manufacture and commercialize a drug technology which is referred to as DARA (the “Ligand License Agreement”). The cost of the Ligand License Agreement, which is presented net of amortization in the accompanying condensed consolidated balance sheets as other amortizable intangible asset, is being amortized to research and development on a straight-line basis through September 30, 2023.

Syntocinon License Agreement

On December 12, 2013, the Company entered into an agreement with Novartis Pharma AG and Novartis AG pursuant to which Novartis Pharma AG and Novartis AG agreed to grant the Company an exclusive, perpetual, and royalty-bearing license for the manufacture, development and commercialization of Syntocinon and related intranasal products in the United States (the “Syntocinon License Agreement”). Under the Syntocinon License Agreement, Novartis Pharma AG and Novartis AG are obligated to transfer to the Company certain information that is necessary for or related to the development or commercialization of Syntocinon. As consideration for the Syntocinon License Agreement, the Company paid to Novartis Pharma AG and Novartis AG and capitalized a $5 million upfront fee. The intellectual property underlying the Syntocinon License Agreement is held in perpetuity. The Company has examined the Syntocinon License Agreement and has capitalized the license fee in accordance with ASC 350 due to future alternative uses such as re-licensing of the technology to other third parties, the sale of the licensed technology to other life science companies, and the potential development of various ingestible drug products using the licensed technologies.

During the second quarter ended June 30, 2014, certain key underlying assumptions regarding the estimated useful life of the Syntocinon License Agreement changed resulting in the Company changing the estimated useful life from indefinite-lived to definite lived, starting in the second quarter of 2014. Such changes relate to the regulatory requirements needed to re-introduce the product for the treatment of lactation deficiency. Management determined the development program approximates seven to eight years and the use patent exclusivity and/or commercial viability period upon approval will be eleven to twelve years. Management assigned a life of twenty (20) years to the asset and is being amortized to research and development on a straight-line basis through December 2033.

In connection with the execution of a Letter of Intent with Martin Shkreli, Turing Pharmaceuticals will assume the balance of the payments due under the Syntocinon License Agreement (see Note 13), subject to the approval of Novartis.

Kyalin - Carbetocin Technology Purchase

On December 23, 2013, the Company entered into a stock purchase agreement with Kyalin to acquire substantially all of Kyalin’s assets which include patents, patent applications, contracts and data related to the intranasal formulation of the compound Carbetocin (collectively, the “Carbetocin Assets”). Carbetocin, similar to oxytocin, has potential utility for the treatment of milk let-down in post pregnant women, inducing contractions during labor, postpartum hemorrhage, as well as for schizophrenia.

The Company capitalized $3 million of fixed minimum payments and closing costs. For tax purposes, intangible assets are subject to different amortization allowances than for book purposes. FASB ASC 740-10-55 (“ASC 740”) addresses the accounting treatment when an asset is acquired outside of a business combination, and the tax basis of that asset differs from the amount paid. For the year ended December 31, 2013, pursuant to the guidance in ASC 740, the Company stepped-up the basis of its intangible assets by $2.5 million and recorded a deferred tax liability in the same amount, to account for the book/tax basis difference resulting from the Kyalin acquisition.

During the second quarter ended June 30, 2014, certain underlying assumptions regarding the estimated useful life of the Carbetocin Assets changed resulting in the Company changing the estimated useful life from indefinite-lived to definite lived, starting in the second quarter of fiscal 2014. Such changes relate to the regulatory requirements needed to develop the Carbetocin Assets, as well as the departure of key personnel responsible for the development of the Carbetocin Assets. Management determined the development program approximates five to seven years and commercial viability will be five to seven years. Management assigned a life of ten (10) years to the assets and is being amortized to research and development on a straight-line basis through December 2023.

The change in estimated useful life in the second quarter of fiscal 2014 also resulted in reversal of the deferred tax liability and recording a tax benefit of $2.5 million as it was no longer necessary to account for the book/tax difference of Kyalin.

Manchester Pharmaceuticals LLC

Upon the completion of the Company’s acquisition of Manchester on March 26, 2014, the Company acquired intangible assets with definite lives related to product rights, trade names, and customer relationships with the values of $71.4 million, $0.2 million, and $0.4 million, respectively. The useful lives related to the acquired product rights, trade names, and customer relationships are expected to be approximately 16, 1 and, 10 years, respectively. Amortization of product rights, amortization of trade names and customer relationships are being recorded in selling, general and administrative expense over their respective lives.

Thiola License Agreement

On May 29, 2014, the Company entered into a license agreement with Mission, pursuant to which Mission agreed to grant the Company an exclusive, royalty-bearing license to market, sell and commercialize Thiola in the United States and a non-exclusive license to use know-how relating to Thiola to the extent necessary to market Thiola. In July 2014, the Company amended the license agreement with Mission to secure the Canadian marketing rights to the product for no additional consideration.

Upon execution of the agreement, the Company paid Mission an up-front license fee of $3 million. In addition, the Company shall pay guaranteed minimum royalties during each calendar year the greater of $2 million or twenty percent (20%) of the Company’s net sales of Thiola through June 30, 2024. As of September 30, 2014, the present value of guaranteed minimum royalties payable is $11.8 million using a discount rate of approximately 11% based on the Company’s current borrowing rate. As of September 30, 2014, the guaranteed minimum royalties’ current and long term liability is approximately $0.8 million and $11 million, respectively, and is recorded as other liability in the condensed consolidated balance sheet. The Company capitalized $15 million related to the Thiola asset which consists of the up-front license fee, professional fees, and the present value of the guaranteed minimum royalties.

As of September 30, 2014, the net book value of amortizable intangible assets was approximately $96.2 million. Amortization expense recorded as research and development expenses amounted to $260,539 and $565,925 for the three and nine months ended September 30, 2014, respectively. Amortization expense recorded as research and development expenses amounted to $0 for the three and nine months ended September 30, 2013. Amortization expense recorded as general and administrative amounted to $1.6 million and $2.9 million for the three and nine months ended September 30, 2014, respectively and $51,065 and $151,531 for the three and nine months ended September 30, 2013, respectively.

Amortizable intangible assets as of September 30, 2014 and December 31, 2013 consisted of the following:

	September 30, 2014
	Gross Carrying Amount		Accumulated Amortization			Net Book Value
Product Rights	$	71,372,000	$	(2,296,019	)	$	69,075,981
Thiola License		15,049,648		(494,570	)		14,555,078
Syntocinon License*		5,000,000		(126,494	)		4,873,506
Carbetocin Assets*		5,567,736		(285,284	)		5,282,452
Ligand License		2,300,000		(475,513	)		1,824,487
Customer Relationships		403,000		(20,740	)		382,260
Trade Name		175,000		(90,137	)		84,863
Patent Costs		143,928		(2,615	)		141,313
Total	$	100,011,312	$	(3,791,372	)	$	96,219,940

* The Company commenced amortization in the second quarter of fiscal 2014 due to a change in estimate.

	December 31, 2013
	Gross Carrying Amount		Accumulated Amortization			Net Book Value
Ligand License	$	2,300,000	$	(323,980	)	$	1,976,020
Patent Costs		49,775		-			49,775
Total	$	2,349,775	$	(323,980	)	$	2,025,795

Amortization expense for the years ending December 31, 2014, 2015, 2016, 2017, and 2018 is expected to be $5.3 million, $7.1 million, $7.0 million, $7.0 million, and $7.0 million, respectively.

NOTES PAYABLE

9 Months Ended

Sep. 30, 2014

Debt Disclosure [Abstract]

10. NOTES PAYABLE

NOTE 10. NOTES PAYABLE

Note Payable – Manchester Pharmaceuticals, LLC

On March 26, 2014, upon the acquisition of Manchester, the Company entered into a note payable in the amount of $33 million. The note is non-interest bearing and therefore the Company recorded the loan at present value of $31.3 million using the effective interest rate of approximately 11%, which was the Company’s current borrowing rate. The note was due and payable in three consecutive payments, each in the amount of $11 million payable on June 26, 2014, September 26, 2014, and December 12, 2014 (the maturity date). On June 30, 2014, the Company paid off the note in its entirety. The Company accelerated interest expense in the amount of $1.7 million for the difference between the present value of the loan and the loan balance paid has been recorded in interest income (expense), net for the nine months ended September 30, 2014.

Convertible Notes Payable

On May 29, 2014, the Company entered into the Note Purchase Agreement relating to a private placement by the Company of $46 million aggregate principal senior convertible notes due 2019 (the “Notes”) which are convertible into shares of the Company’s common stock at an initial conversion price of $17.41 per share. The conversion price is subject to customary anti-dilution protection. The Notes bear interest at a rate of 4.5% per annum, payable semiannually in arrears on May 15 and November 15 of each year, beginning on November 15. The Notes mature on May 30, 2019 unless earlier converted or repurchased in accordance with the terms. The aggregate carrying value of the Notes on their issuance was $43 million, which was net of the $3 million debt discount. The debt discount is being amortized to interest expense over the term of the Notes under the effective interest method. As of September 30, 2014, accrued interest amounted to $0.7 million related to the Notes.

On June 30, 2014, the Company issued 401,047 shares of Common Stock to the holders of the Note and such Noteholders granted the Company a release of certain claims they may have had in connection with the Company's sale of the Notes or certain statements made by the Company in connection with such sale. The Company recorded finance expense as other expense in the amount of $4.7 million for the nine months ended September 30, 2014 based on the fair market value of the stock on the date of issuance in relation to the shares issued.

Note Payable with Detachable Warrants

On June 30, 2014, the Company entered into the $45 million Credit Agreement (“Note Payable”) which matures on June 30, 2018 and bears interest at an annual rate of (i) the Adjusted LIBOR Rate (as such term is defined in the Credit Agreement) plus 10.00% or (ii) in certain circumstances, the Base Rate (as such term is defined in the Credit Agreement) plus 9.00%. The Credit Agreement contains certain covenants, including those limiting the Company's and its subsidiaries' abilities to incur indebtedness, incur liens, sell or acquire assets or businesses, change the nature of their businesses, engage in transactions with related parties, make certain investments or pay dividends. In addition, starting September 2014, the Credit Agreement has required the Company and its subsidiaries to meet certain financial quarterly requirements. Failure by the Company or its subsidiaries to comply with any of these covenants or financial tests could result in the acceleration of the loans under the Credit Agreement. As of September 30, 2014, the Company was out of compliance with certain of the covenants. On November 13, 2014, the Company entered into Amendment No. 2 to the Credit Agreement which allowed the Company to be in compliance with certain covenants (see Note 13).

The aggregate carrying value of the convertible notes on their issuance was $39.8 million, which was net of the $5.2 million debt discount. The debt discount is being amortized to interest expense over the term of the notes under the effective interest method.

In connection with the execution of the Credit Agreement, the Company issued warrants (the “Warrants”) to the lenders under the Credit Agreement, initially exercisable to purchase up to an aggregate of 337,500 shares of common stock of the Company. The Warrants will be exercisable in whole or in part, at an initial exercise price per share of $12.76 per share, which is subject to weighted-average anti-dilution protections. The Warrants may be exercised at any time upon the election of the holder, beginning on the date of issuance and ending on the fifth anniversary of the date of issuance. The issuance of the Warrants was not registered under the Securities Act of 1933, as amended (the “Securities Act”), as such issuance was exempt from registration under Section 4(2) of the Securities Act.

The total grant date fair value of the Warrants was $2.5 million and was recorded as a derivative liability and is included in the debt discount to the Note Payable in the condensed consolidated balance sheets. The Company calculated the fair value of the warrants using the Binomial Lattice pricing model using the following assumptions as of the grant date of the Warrants:

Risk free rate		1.62	%
Expected volatility		85	%
Expected life (in years), represents the weighted average period until next liquidity event		0.36
Expected dividend yield		-
Exercise Price	$	12.76

Debt Maturities

The stated maturities of the Company’s long-term debt are as follows (in millions) as of December 31:

2014	$	-
2015		-
2016		-
2017		-
2018		45
Thereafter		46
	$	91

Total interest expense recognized for the three and nine months ended September 30, 2014 aggregated to $2.6 million and $4.8 million, respectively. Total interest expense recognized for the three and nine months ended September 30, 2013 aggregated to $0 and $41,554 respectively.

COMMITMENTS AND CONTINGENCIES

9 Months Ended

Sep. 30, 2014

Commitments and Contingencies Disclosure [Abstract]

11. COMMITMENTS AND CONTINGENCIES

NOTE 11. COMMITMENTS AND CONTINGENCIES

Leases and Sublease Agreements

On February 28, 2014, the Company amended its lease agreement for its offices located in Carlsbad, California. The Company increased its Carlsbad office space for approximately $110,000 of additional annual base rent plus rent escalations, common area maintenance, insurance, and real estate taxes under a lease agreement expiring on June 30, 2017.

On April 10, 2014, the Company entered into an amended lease agreement at its principal offices in New York, New York and is responsible for additional rent of approximately $537,264 annually plus rent escalations through April 2015.

On July 31, 2014, the Company entered into a sublease agreement for new office space located in Cambridge, Massachusetts. The Company increased its office space for approximately $800,000 of additional rent per annum. The sublease expires on December 31, 2016.

On September 8, 2014, the Company entered into a lease agreement for new office space located in San Diego, California. The Company rents its office space for approximately $540,000 per annum. The lease started on October 1, 2014 and expires on December 31, 2017.

Research Collaboration and Licensing Agreements

As part of the Company's research and development efforts, the Company enters into research collaboration and licensing agreements with unrelated companies, scientific collaborators, universities, and consultants. These agreements contain varying terms and provisions which include fees and milestones to be paid by the Company, services to be provided, and ownership rights to certain proprietary technology developed under the agreements. Some of these agreements contain provisions which require the Company to pay royalties, in the event the Company sells or licenses any proprietary products developed under the respective agreements.

Contractual Commitments

The following table summarizes our principal contractual commitments, excluding open orders that support normal operations, as of September 30, 2014:

Year Ending December 31,	Research and Development and other Charitable Donations		Consultants		Operating Leases
2014	$	4,586,620	$	183,330	$	760,788
2015		5,790,774		-		1,579,211
2016		2,651,191		-		1,379,578
2017		2,374,664		-		632,094
Total	$	15,403,249	$	183,330	$	4,351,671

Legal Proceedings

On June 13, 2014, Charles Schwab & Co., Inc. (“Schwab”) sued the Company, Standard Registrar and Transfer Company (“Standard”), Jackson Su (“Su”), and Chun Yi Huang (“Huang”) in federal court in the Southern District of New York (Charles Schwab & Co. v. Retrophin, Inc., Case No. 14-cv-4294). The complaint alleges that defendants misled Schwab in connection with its sale of Retrophin, Inc. stock owned by Su and Huang. Schwab contends that Su and Huang improperly advised it that their Retrophin, Inc. stock was not restricted. Schwab’s claim against the Company is based on an agency theory. Schwab contends that it has incurred in excess of $2.5 million in damages as a result of the alleged misinformation. Su and Huang have asserted cross-claims against the Company and Standard for alleged negligent misrepresentation premised upon an alleged failure to inform them of restrictions on the sale of their Retrophin, Inc. stock. Su and Huang have also impleaded Katten Muchin Rosenman LLP as a third-party defendant. The Company has filed motions to dismiss Schwab’s claims, as well as Su’s and Huang’s cross claims. The Company is unable to predict the timing or outcome of this litigation.

On January 7, 2014, the Company sued Questcor Pharmaceuticals, Inc. (“Questcor”) in federal court in the Central District of California (Retrophin, Inc. v. Questcor Pharmaceuticals, Inc., Case No. SACV14-00026-JLS). The Company contends that Questcor violated antitrust laws in connection with its acquisition of rights to the drug Synacthen, and seeks injunctive relief and damages. The Company has asserted claims under sections 1 and 2 of the Sherman Act, section 7 of the Clayton Act, California antitrust laws, and California’s unfair competition law. On August 8, 2014, the Court denied Questcor’s motion to dismiss. The parties are now engaged in discovery. A trial is currently set for November 2015. The Company is unable to predict the outcome of this litigation.

On September 19, 2014, a purported shareholder of the Company sued Martin Shkreli in federal court in the Southern District of New York (Donoghue v. Retrophin, Inc., Case No. 14-cv-7640). The plaintiff seeks, on behalf of the Company, disgorgement of short-swing profits from Mr. Shkreli under section 16(b) of the Securities Exchange Act of 1934 (15 U.S.C. 78(p)(b)). The complaint alleges that, based on trades in Retrophin, Inc. stock between November 2013 and September 2014, Mr. Shkreli realized short-swing profits of approximately $1.5 million, which belong to the Company. The Company is a nominal defendant in this action. The Company is unable to predict the timing or outcome of this litigation.

On October 20, 2014, a purported shareholder of the Company filed a putative class action complaint in federal court in the Southern District of New York against the Company, Martin Shkreli, Marc Panoff, and Jeffrey Paley (Kazanchyan v. Retrophin, Inc., Case No. 14-cv-8376). The complaint asserts violation of sections 10(b) and 20(a) of the Securities Exchange Act of 1934 in connection with public disclosures made during the period March 27, 2014 through September 30, 2014. The deadline for parties to file motions for lead plaintiff and lead counsel is December 19, 2014. The Company plans to vigorously defend against the claims advanced. At this time, the Company is unable to predict the timing or outcome of this litigation.

From time to time the Company is involved in legal proceedings arising in the ordinary course of business. The Company believes there is no other litigation pending that could have, individually or in the aggregate, a material adverse effect on its results of operations or financial condition.

STOCKHOLDERS DEFICIT

9 Months Ended

Sep. 30, 2014

Equity [Abstract]

12. STOCKHOLDERS DEFICIT

NOTE 12. STOCKHOLDERS’ DEFICIT

Issuances

Public Offering - 2014

On January 9, 2014, the Company completed a public offering of 4,705,882 shares of common stock at a price of $8.50 per share. The Company received net proceeds from the offering of $36.8 million after deducting the underwriting fees and other offering costs of $3.2 million, which were recorded against additional paid in capital.

Restricted Shares

As of September 30, 2014, there was approximately $7.7 million of unrecognized compensation cost related to restricted shares granted. As of September 30, 2014 and December 31, 2013, these amounts are expected to be recognized over a weighted average period of 2.06 years. Unvested restricted shares consist of the following as of September 30, 2014.

	Employee - number of shares			Non-Employee - number of shares			Total number of shares			Weighted Average Grant Date Fair Value
Unvested December 31, 2013		130,215			38,427			168,642			6.44
Granted		630,000			-			630,000			17.08
Vested		(141,809	)		(38,427	)		(180,236	)		22.66
Forfeited/cancelled		(4,155	)		-			(4,155	)		3.00
Unvested September 30, 2014		614,251			-			614,251		$	15.09

Stock Options

The Company uses the Black-Scholes option pricing model to value options granted to employees and directors. Compensation expense is recognized over the period of service, generally the vesting period. Stock-based compensation related to stock options totaled $3.2 million and $6.3 million for the three and nine months ended September 30, 2014, respectively. The Company did not record stock based compensation expense for the three and nine months ended September 30, 2013 related to options.

The unamortized stock options expense totaled $25.2 million as of September 30, 2014 which will be recognized over a weighted-average period of 2.53 years.

During the nine months ended September 30, 2014, 3,705,500 stock options were granted by the Company. The fair values of stock option grants during the nine months ended September 30, 2014 were calculated on the date of grant using the Black-Scholes option pricing model, except for options granted for market and revenue performance criteria. The following assumptions were used in the Black-Scholes options pricing model:

	Nine Months Ended September 30, 2014
Risk free rate		1.55	%
Expected volatility		85	%
Expected life (in years)		5.81
Expected dividend yield		-

The risk-free interest rate was based on rates established by the Federal Reserve. The Company’s expected volatility was based on analysis of the Company’s volatility, as well as the volatilities of guideline companies. The expected life of the Company’s options was determined using the simplified method as a result of limited historical data regarding the Company’s activity. The dividend yield is based upon the fact that the Company has not historically paid dividends, and does not expect to pay dividends in the foreseeable future.

Options granted during the nine months ended September 30, 2014 were as follows:

				Weighted Average
	Shares Underlying Options			Exercise Price		Remaining Contractual Term (in years)		Aggregate Intrinsic Value
Outstanding at December 31, 2013		1,721,000		$	7.66		9.89	$	172,000
Granted during 2014		3,705,500			14.9		10.24		-
Exercised		(1,833	)		6.20		-		-
Forfeited/cancelled		(720,833	)		6.20		0.08		-
Outstanding at September 30, 2014		4,703,834		$	12.36		9.51	$	1,597,920
Exercisable as of September 30, 2014		931,083		$	10.57		9.19	$	770,420

The intrinsic value is calculated as the difference between the closing price of the Company’s common stock as of September 30, 2014, which was $9.02 per share, and the exercise price of the options.

Share Based Compensation

Share based compensation expense consisted of the following for the three months and nine months ended September 30, 2014 and 2013:

	Three Months Ended				Nine Months Ended
	September 30, 2014		September 30 2013		September 30, 2014		September 30, 2013
Restricted Shares	$	1,931,618	$	1,667,586	$	8,444,950	$	1,918,500
Stock Options		2,762,853		74,322		6,264,151		111,005
Total	$	4,694,471	$	1,741,908	$	14,709,101	$	2,029,505

Exercise of Warrants

During the nine months ended September 30, 2014, the Company issued 1,962,377 shares of common stock upon the exercise of warrants for cash received by the Company in the amount of $8.3 million. The Company reclassified $23.4 million derivative liability as equity for the value of these warrants on the date of exercise. The warrants were revalued immediately prior to exercise and the change in the fair value of the warrants was recorded as other expense in the condensed consolidated financial statements of the Company.

Stock Repurchases

During the nine months ended September 30, 2014, the Company repurchased 248,801 shares of its common stock for an aggregate purchase price of $2.3 million. The Company recognizes repurchased common stock as treasury stock.

- 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.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(d),(e))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 4
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21484-112644

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 310
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SAB TOPIC 4.E)
-URI http://asc.fasb.org/extlink&oid=27010918&loc=d3e74512-122707

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21488-112644

Reference 5: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.29-31)
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
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-Paragraph 4
-Subparagraph (SAB TOPIC 4.C)
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Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
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-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21506-112644

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.3-04)
-URI http://asc.fasb.org/extlink&oid=27012166&loc=d3e187085-122770

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 30
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6405834&loc=d3e23285-112656

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Preferred Stock
-URI http://asc.fasb.org/extlink&oid=6521494

Reference 12: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
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-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21463-112644

Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
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-Section 50
-Paragraph 11
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21564-112644

Reference 14: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 08
-Paragraph d
-Article 4

Reference 15: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 02
-Paragraph 29, 30, 31
-Article 5

Reference 16: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Staff Accounting Bulletin (SAB)
-Number Topic 4
-Section E

Reference 17: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 08
-Article 4

Reference 18: http://www.xbrl.org/2003/role/presentationRef
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Reference 19: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
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-Number 210
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-Article 3

+ Details

SEVERANCE AGREEMENTS

9 Months Ended

Sep. 30, 2014

Severance Agreement [Abstract]

13. SEVERANCE AGREEMENTS

NOTE 13. SEVERANCE AGREEMENTS

On September 15, 2014, the Company entered into a separation agreement and release (the “Separation Agreement”) with Marc Panoff, the Company’s Chief Financial Officer, pursuant to which Mr. Panoff’s employment with the Company will terminate, effective as of February 28, 2015. Under the terms of the Separation Agreement, Mr. Panoff will be entitled to receive: (i) severance payments equal to six months of his current base salary; (ii) 100% of his target bonus for 2014; (iii) accelerated vesting of 81,333 shares of restricted common stock of the Company; and (iv) benefits under the Company’s benefit plans, subject to the terms of each such plan. In conjunction with the Separation Agreement, the Company has accrued $90,865 in connection with Mr. Panoff’s severance which will be expensed ratably over the service period from September 15, 2014 through February 28, 2015. The Company has recorded severance expense of $27,151 and $63,714 for the three months ended September 30, 2014 relating to Mr. Panoff’s severance benefits and accelerated vesting of restricted shares, respectively recorded in selling, general and administrative in the condensed consolidated statements of operations. The target bonus is being recognized ratably over the course of the current fiscal year.

On September 30, 2014, the Company’s Board of Directors (“Board”) appointed Stephen Aselage, as the Company’s interim Chief Executive Officer to replace Martin Shkreli, the Company’s founder and Chief Executive Officer. Mr. Aselage previously served as the Company’s President and Chief Operations Officer since May 2014 and as a director of the Company since December 2012.

On October 13, 2014, Martin Shkreli resigned as a member of the Board and as an employee of the Company, and from any and all other positions that he held with the Company. On October 13, 2014, the Company entered into a Separation Agreement with Mr. Shkreli (“Separation Agreement”). As part of Mr. Shkreli’s Separation Agreement, Mr. Shkreli received cash severance of 12 months annual base salary, unpaid bonus and health insurance coverage, 12 months of continued vesting of time based stock options and no vesting of performance based stock options. Pursuant to the Separation Agreement, Mr. Shkreli’s market and performance based stock options have been forfeited. As a result, for the three and nine months ended September 30, 2014, the Company recorded compensation expense in the amount of $481,076 relating to Mr. Shkreli’s cash severance, unpaid bonus and health insurance coverage and compensation expense of $1.1 million related to the accelerated vesting of Mr. Shkreli’s time based stock options.

On October 13, 2014, the Company signed a Letter of Intent for the terms for the sale of the Company’s Vecamyl, Syntocinon and ketamine licenses and assets to Turing Pharmaceuticals, which includes an up-front payment to the Company of $3 million and the assumption of certain liabilities including license fees and royalties (the “Sale Transaction”). Martin Shkreli, the Company’s former Chief Executive Officer and Director, is the Chief Executive Officer of Turing Pharmaceuticals. The closing of the Sale Transaction is subject to various conditions, including the negotiation and execution of a binding definitive agreement between the Company and Turing Pharmaceuticals and the receipt of necessary third party consents and is expected to close by the end of the first quarter of 2015. In connection with the Letter of Intent with Martin Shkreli, the Company recorded severance expense and accrued severance expense of $2.9 million as of September 30, 2014 which is the difference between of the net book value of the assets to be sold and the $3 million expected up front payment.

As both transactions were contemplated simultaneously, they were both considered in calculating the respective severance expense related to Mr. Shkreli’s termination. The full amount of the severance was recorded as of September 30, 2014 as that was the date that the Board replaced Martin Shkreli as CEO of the Company until a formal separation agreement could be finalized. As of September 30, 2014, it was deemed to be probable and estimable that Mr. Shkreli would enter into a Separation Agreement that would entitle him to severance benefits. Therefore the estimated severance that was booked as of the end of the third quarter is based on the best estimate currently available and the full severance amount was recorded as of September 30, 2014 as Mr. Shkreli was not required to perform any future service for the Company. For the three and nine months ended September 30, 2014, the Company recorded a total of $4.5 million severance expense in connection with Mr. Shkreli’s Separation Agreement which has been recorded in selling, general and administrative expenses in the condensed consolidated statements of operations.

On November 10, 2014, the Board appointed Stephen Aselage as the Company’s Chief Executive Officer, effective immediately. Mr. Aselage has been serving as the company's interim Chief Executive Officer since September 30, 2014.

SUBSEQUENT EVENTS

9 Months Ended

Sep. 30, 2014

Subsequent Events [Abstract]

14. SUBSEQUENT EVENTS

NOTE 14. SUBSEQUENT EVENTS

On November 13, 2014, the Company entered into Amendment No. 2 (“Amendment No. 2”) to the Credit Agreement which allowed the Company to be in compliance with certain covenants as of September 30, 2014. In addition certain covenants related to the 4^th quarter of fiscal 2014 and 2015 were amended. As compensation for Amendment No. 2, the Company agreed to issue additional warrants to the lenders, initially exercisable to purchase an aggregate of300,000 shares of common stock of the Company. Such compensation will be recorded as a charge to operations in the fourth quarter of 2014.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

9 Months Ended

Sep. 30, 2014

Accounting Policies [Abstract]

Principles of Consolidation

Principles of Consolidation

Reclassifications

Reclassifications

Certain reclassifications have been made to prior period amounts to conform with the current period presentation.

Accounts Receivable - Trade

Accounts Receivable – Trade

Inventory

Inventory

Inventory consists of the following at September 30, 2014:

	September 30, 2014
Raw material	$	314,625
Finished goods		368,940
Total inventory	$	683,565

Income Taxes

Income Taxes

Revenue Recognition

Revenue Recognition

Government Rebates and Chargebacks

Distribution-Related Fees

Prompt Pay Discounts

Product Returns

Loss per Share

Loss per Share

The following sets forth the computation of diluted EPS for the three months ended September 30, 2014:

	Three months ended September 30, 2014
	Net loss (Numerator)			Shares (Denominator)		Per Share Amount
Basic EPS	$	(19,556,300	)		26,682,510	$	(0.73	)
Change in fair value of derivative instruments		(5,689,144	)		-
Dilutive shares related to warrants		-			1,527,715
Dilutive EPS	$	(25,245,444	)		28,210,225	$	(0.89	)

New Accounting Standards

Recently Issued Accounting Pronouncements

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

9 Months Ended

Sep. 30, 2014

Accounting Policies [Abstract]

Restatement of Prior Quarters

	September 30, 2014
Raw material	$	314,625
Finished goods		368,940
Total inventory	$	683,565

Computation of diluted EPS

	Three months ended September 30, 2014
	Net loss (Numerator)			Shares (Denominator)		Per Share Amount
Basic EPS	$	(19,556,300	)		26,682,510	$	(0.73	)
Change in fair value of derivative instruments		(5,689,144	)		-
Dilutive shares related to warrants		-			1,527,715
Dilutive EPS	$	(25,245,444	)		28,210,225	$	(0.89	)

BUSINESS COMBINATION (Tables)

9 Months Ended

Sep. 30, 2014

Business Combinations [Abstract]

Purchase price allocation

	Amount (in thousands)
Cash paid upon consummation, net	$	29,150
Secured promissory note		31,283
Fair value of acquisition-related contingent consideration		12,800
Total purchase price	$	73,233

Prepaid expenses		116
Inventory		517
Product rights		71,372
Trade names		175
Customer relationship		403
Goodwill		936
Other asset		1,522
Accounts payable and accrued expenses		(286	)
Other liability		(1,522	)
Total allocation of purchase price consideration	$	73,233

Pro Forma Operating Results

	Pro Forma (Unaudited)
	Three months ended September 30, (in thousands, except per share data)						Nine months ended September 30, (in thousands, except per share data)
	2014			2013			2014			2013
Net product sales	$	8,349		$	1,098		$	15,337		$	3,295
Net loss	$	(19,556	)	$	(10,033	)	$	(81,080	)	$	(18,096	)
Net loss per common share, basic	$	(0.73	)	$	(0.65	)	$	(3.21	)	$	(1.41	)

MARKETABLE SECURITIES AND SECURITIES SOLD, NOT YET PURCHASED (Tables)

9 Months Ended

Sep. 30, 2014

Marketable Securities [Abstract]

Marketable securities

Marketable securities and securities sold, not yet purchased at September 30, 2014 consisted of the following:

	Cost		Unrealized Gains		Unrealized Losses		Estimated Fair Value

Marketable securities available-for-sale:	$	8,220,349	$	3,732,622	$	22,479	$	11,930,492
Securities sold, not yet purchased	$	3,184,572	$	47,035	$	12,876	$	3,150,413

Marketable securities and securities sold, not yet purchased at December 31, 2013 consisted of the following:

	Cost		Unrealized Gains		Unrealized Losses		Estimated Fair Value

Marketable securities available-for-sale:	$	129,702	$	3,292	$	-	$	132,994
Securities sold, not yet purchased	$	1,344,622	$	13,256	$	126,535	$	1,457,901

DERIVATIVE FINANCIAL INSTRUMENTS (Tables)

9 Months Ended

Sep. 30, 2014

Investments, All Other Investments [Abstract]

Assumptions for valuation of warrants

	As of
	September 30, 2014		December 31, 2013
Fair value of common stock		$9.02		$7.00
Expected life (in years), represents the weighted average period until next liquidity event		.75 – 1.00 years		4.12-4.62 years
Risk-free interest rate		1.2% - 1.69%		1.39%
Expected volatility		85%		93-97%
Dividend yield		0.00%		0.00%

FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

Sep. 30, 2014

Fair Value Disclosures [Abstract]

Fair value on a recurring basis

	As of September 30, 2014		Fair Value Hierarchy at September 30, 2014
	Total carrying and estimated fair value		Quoted prices in active markets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Asset:
Marketable securities, available-for-sale	$	11,930,492	$	11,930,492	$	-	$	-

Liabilities:

Derivative liability related to warrants	$	18,480,000	$	-	$	-	$	18,480,000
Securities sold, not yet purchased	$	3,150,413	$	3,150,413	$	-	$	-
Acquisition-related contingent consideration	$	12,237,930	$	-	$	-	$	12,237,930

	As of December 31, 2013		Fair Value Hierarchy at December 31, 2013
	Total carrying and estimated fair value		Quoted prices in active markets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)

Asset:
Marketable securities, available-for-sale	$	132,994	$	132,994	$	-	$	-

Liability:
Derivative liability related to warrants	$	25,037,346	$	-	$	-	$	25,037,346
Securities sold, not yet purchased	$	1,457,901	$	1,457,901	$	-	$	-

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, 2013	$	25,037,346
Issuance of common stock warrants, September 30, 2014 (see Note 10)		2,531,250
Reclassification of derivative liability to equity upon exercise of warrants		(23,364,668	)
Change in estimated fair value of liability classified warrants		14,276,072
Balance at September 30, 2014	$	18,480,000

The following table sets forth a summary of changes in the estimated acquisition-related contingent consideration for the period from January 1, 2014 through September 30, 2014:

	Fair Value Measurements of Acquisition-Related Contingent Consideration
Balance at January 1, 2014	$	-
Present value of contractual payments, contingent consideration upon acquisition		12,800,000
Contractual Payments		(562,070	)
Balance at September 30, 2014	$	12,237,930

INTANGIBLE ASSETS (Tables)

9 Months Ended

Sep. 30, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

Indefinite lived intangible asset

Amortizable intangible assets as of September 30, 2014 and December 31, 2013 consisted of the following:

	September 30, 2014
	Gross Carrying Amount		Accumulated Amortization			Net Book Value
Product Rights	$	71,372,000	$	(2,296,019	)	$	69,075,981
Thiola License		15,049,648		(494,570	)		14,555,078
Syntocinon License*		5,000,000		(126,494	)		4,873,506
Carbetocin Assets*		5,567,736		(285,284	)		5,282,452
Ligand License		2,300,000		(475,513	)		1,824,487
Customer Relationships		403,000		(20,740	)		382,260
Trade Name		175,000		(90,137	)		84,863
Patent Costs		143,928		(2,615	)		141,313
Total	$	100,011,312	$	(3,791,372	)	$	96,219,940

* The Company commenced amortization in the second quarter of fiscal 2014 due to a change in estimate.

	December 31, 2013
	Gross Carrying Amount		Accumulated Amortization			Net Book Value
Ligand License	$	2,300,000	$	(323,980	)	$	1,976,020
Patent Costs		49,775		-			49,775
Total	$	2,349,775	$	(323,980	)	$	2,025,795

NOTES PAYABLE (Tables)

9 Months Ended

Sep. 30, 2014

Debt Disclosure [Abstract]

Schedule of fair value of warrants

<p style="font: 10pt/normal 'times new roman', times, serif; margin: 0px; text-align: justify; color: #000000; text-transform: none; text-indent: 0px; letter-spacing: normal; word-spacing: 0px; white-space: normal; font-stretch: normal; -webkit-text-stroke-width: 0px;"> <table style="font: 10pt/normal 'times new roman', times, serif; width: 1280px; text-transform: none; text-indent: 0px; letter-spacing: normal; word-spacing: 0px; border-collapse: collapse; font-size-adjust: none; font-stretch: normal; -webkit-text-stroke-width: 0px;" cellspacing="0" cellpadding="0"><tr style="vertical-align: bottom; background-color: #cceeff;"><td style="width: 1113.63px; text-align: left;">Risk free rate</td><td style="width: 13.63px;"> </td><td style="width: 12.72px; text-align: left;"> </td><td style="width: 127.27px; text-align: right;">1.62</td><td style="width: 12.72px; text-align: left;">%</td></tr><tr style="vertical-align: bottom; background-color: white;"><td style="text-align: left;">Expected volatility</td><td> </td><td style="text-align: left;"> </td><td style="text-align: right;">85</td><td style="text-align: left;">%</td></tr><tr style="vertical-align: bottom; background-color: #cceeff;"><td style="text-align: left;">Expected life (in years), represents the weighted average period until next liquidity event</td><td> </td><td style="text-align: left;"> </td><td style="text-align: right;">0.36</td><td style="text-align: left;"> </td></tr><tr style="vertical-align: bottom; background-color: white;"><td style="text-align: left;">Expected dividend yield</td><td> </td><td style="text-align: left;"> </td><td style="text-align: right;">-</td><td style="text-align: left;"> </td></tr><tr style="vertical-align: bottom; background-color: #cceeff;"><td>Exercise Price</td><td> </td><td style="text-align: left;">$</td><td style="text-align: right;">12.76</td><td style="text-align: left;"> </td></tr></table><div> </div>

Schedule of maturities of long-term debt

The stated maturities of the Company’s long-term debt are as follows (in millions) as of December 31:

2014	$	-
2015		-
2016		-
2017		-
2018		45
Thereafter		46
	$	91

COMMITMENTS AND CONTINGENCIES (Tables)

9 Months Ended

Sep. 30, 2014

Commitments and Contingencies Disclosure [Abstract]

Principal contractual commitments

Year Ending December 31,	Research and Development and other Charitable Donations		Consultants		Operating Leases
2014	$	4,586,620	$	183,330	$	760,788
2015		5,790,774		-		1,579,211
2016		2,651,191		-		1,379,578
2017		2,374,664		-		632,094
Total	$	15,403,249	$	183,330	$	4,351,671

STOCKHOLDERS' DEFICIT (Tables)

9 Months Ended

Sep. 30, 2014

Stockholders' Equity Note [Abstract]

Schedule of incentive shares

	Employee - number of shares			Non-Employee - number of shares			Total number of shares			Weighted Average Grant Date Fair Value
Unvested December 31, 2013		130,215			38,427			168,642			6.44
Granted		630,000			-			630,000			17.08
Vested		(141,809	)		(38,427	)		(180,236	)		22.66
Forfeited/cancelled		(4,155	)		-			(4,155	)		3.00
Unvested September 30, 2014		614,251			-			614,251		$	15.09

Assumptions used in Black-Scholes options pricing model

	Nine Months Ended September 30, 2014
Risk free rate		1.55	%
Expected volatility		85	%
Expected life (in years)		5.81
Expected dividend yield		-

Schedule of stock option issuances and balances outstanding

				Weighted Average
	Shares Underlying Options			Exercise Price		Remaining Contractual Term (in years)		Aggregate Intrinsic Value
Outstanding at December 31, 2013		1,721,000		$	7.66		9.89	$	172,000
Granted during 2014		3,705,500			14.9		10.24		-
Exercised		(1,833	)		6.20		-		-
Forfeited/cancelled		(720,833	)		6.20		0.08		-
Outstanding at September 30, 2014		4,703,834		$	12.36		9.51	$	1,597,920
Exercisable as of September 30, 2014		931,083		$	10.57		9.19	$	770,420

Share based compensation expenses

	Three Months Ended				Nine Months Ended
	September 30, 2014		September 30 2013		September 30, 2014		September 30, 2013
Restricted Shares	$	1,931,618	$	1,667,586	$	8,444,950	$	1,918,500
Stock Options		2,762,853		74,322		6,264,151		111,005
Total	$	4,694,471	$	1,741,908	$	14,709,101	$	2,029,505

LIQUIDITY AND FINANCIAL CONDITION AND MANAGEMENT'S PLANS (Detail Narrative) - USD ($)		3 Months Ended			9 Months Ended
	Jan. 09, 2014	Sep. 30, 2014	Jun. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013	Dec. 31, 2013	Dec. 31, 2012
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Net loss		$ (19,556,300)		$ (10,897,799)	$ (81,699,079)	$ (20,689,236)
Change in estimated fair value of liability classified warrants		(6,359,144)		5,803,054	14,276,072	8,198,672
Cash		25,861,729		$ 13,409,825	25,861,729	13,409,825	$ 5,997,307	$ 11,388
Working Capital		3,700,000			3,700,000
Accumulated deficit		$ (149,134,700)			(149,134,700)		$ (67,435,621)
Issuance of common stock in connection with January 2014 public offering at $8.5 per share, net of fees of $3,164,990, shares	4,705,882		401,047
Price per common share	$ 8.50
Proceeds received from issuance of common stock, net	$ 36,800,000				$ 36,835,007	$ 31,355,455

- Definition

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

+ References + Details

LIQUIDITY AND FINANCIAL CONDITION AND MANAGEMENT'S PLANS (Detail Narrative 1) - USD ($)	1 Months Ended	3 Months Ended	9 Months Ended
	May 29, 2014	Jun. 30, 2014	Sep. 30, 2014	Oct. 13, 2014
Liquidity And Financial Condition And Managements Plans [Line Items]
Proceeds from notes			$ 42,924,169
Subsequent Event [Member] \| Turing Pharmaceuticals
Liquidity And Financial Condition And Managements Plans [Line Items]
Finite Lived Intangible Asset Upfront Fee				$ 3,000,000
Manchester Pharmaceuticals Llc
Liquidity And Financial Condition And Managements Plans [Line Items]
Credit Agreement amount			33,000,000
Note Purchase Agreement \| Convertible Debt
Liquidity And Financial Condition And Managements Plans [Line Items]
Credit Agreement amount	$ 46,000,000
Interest rate	4.50%
Proceeds from notes	$ 43,000,000
Credit Agreement
Liquidity And Financial Condition And Managements Plans [Line Items]
Credit Agreement amount		$ 45,000,000
Credit Agreement \| Convertible Notes Payable
Liquidity And Financial Condition And Managements Plans [Line Items]
Credit Agreement amount		$ 45,000,000
Proceeds from notes			$ 42,400,000
Credit Agreement \| Convertible Notes Payable \| LIBOR Rate
Liquidity And Financial Condition And Managements Plans [Line Items]
Debt instrument basis points added		10.00%
Credit Agreement \| Convertible Notes Payable \| Base Rate
Liquidity And Financial Condition And Managements Plans [Line Items]
Debt instrument basis points added		9.00%

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details)	Sep. 30, 2014 USD ($)
Accounting Policies [Abstract]
Raw material	$ 314,625
Finished goods	368,940
Total inventory	$ 683,565

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Accounting Policies [Abstract]
Basic EPS, Net income (loss)	$ (19,556,300)
Change in fair value of derivative instruments, Net income (loss)	(5,689,144)
Dilutive EPS, Net income (loss)	$ (25,245,444)
Basic EPS, Shares	26,682,510	15,365,631	25,229,847	12,797,714
Dilutive shares, Shares	1,527,715
Dilutive EPS, Shares	28,210,225	15,365,631	25,229,847	12,797,714
Basic EPS	$ (0.73)	$ (0.71)	$ (3.24)	$ (1.62)
Dilutive EPS	$ (0.89)	$ (0.71)	$ (3.24)	$ (1.62)

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

+ References + Details

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013	Dec. 31, 2013
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Unrecognized tax uncertainties	$ 1,500,000		$ 1,500,000		$ 0
Sales Revenue, Goods
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Customer accounted	97.00%		97.00%
Accounts Receivable
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Customer accounted	100.00%		100.00%
Shares issuable upon exercise of options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Number of shares issuable	2,852,500	120,000	2,852,500	120,000
Conversion of debt
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Number of shares issuable	2,642,160		3,106,345
Warrant
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Number of shares issuable	337,500	1,917,792		1,917,792

BUSINESS COMBINATION (Details)	9 Months Ended
BUSINESS COMBINATION (Details)	Sep. 30, 2014 USD ($)
Business Acquisition [Line Items]
Cash paid upon acquisition, net of cash acquired	$ 29,150,000
Goodwill	935,935
Manchester Pharmaceuticals Llc
Business Acquisition [Line Items]
Cash paid upon acquisition, net of cash acquired	29,150,000
Secured promissory note	31,283,000
Fair value of acquisition-related contingent consideration	12,800,000
Total purchase price	73,233,000
Prepaid expenses	116,000
Inventory	517,000
Goodwill	936,000
Other asset	1,522,000
Accounts payable and accrued expenses	(286,000)
Other liability	(1,522,000)
Total allocation of purchase price consideration	73,233,000
Manchester Pharmaceuticals Llc \| Product Right
Business Acquisition [Line Items]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles	71,372,000
Manchester Pharmaceuticals Llc \| Trade names
Business Acquisition [Line Items]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles	175,000
Manchester Pharmaceuticals Llc \| Customer relationship
Business Acquisition [Line Items]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles	$ 403,000

BUSINESS COMBINATION (Details 1) - Manchester Pharmaceuticals Llc - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Business Acquisition [Line Items]
Net product sales	$ 8,349	$ 1,098	$ 15,337	$ 3,295
Net loss	$ (19,556)	$ (10,033)	$ (81,080)	$ (18,096)
Net loss per common share, basic	$ (0.73)	$ (0.65)	$ (3.21)	$ (1.41)

BUSINESS COMBINATION (Details Narrative) - USD ($)	1 Months Ended	9 Months Ended
BUSINESS COMBINATION (Details Narrative) - USD ($)	Mar. 26, 2014	Sep. 30, 2014
Business Acquisition [Line Items]
Payment for consummation of the transaction		$ 29,150,000
Acquisition costs		29,150,000
Goodwill		935,935
Manchester Pharmaceuticals Llc
Business Acquisition [Line Items]
Acquired outstanding membership interests percentage	100.00%
Payment for consummation of the transaction		29,150,000
Principal amount of promissory note		33,000,000
Contractual payments based on net sales of the products	10.00%
Additional contingent payments based on net sales from new products	5.00%
Business Combination Contingent Consideration Arrangements Estimated Contingent Consideration	$ 12,800,000
Total allocation of purchase price consideration		73,233,000
Goodwill		$ 936,000
Manchester Pharmaceuticals Llc \| Selling, General and Administrative Expenses
Business Acquisition [Line Items]
Acquisition costs	300,000
Manchester Pharmaceuticals Llc \| Promissory Notes Payable
Business Acquisition [Line Items]
Principal amount of promissory note	33,000,000
Discounted principal amount of promissory note	31,300,000
Quaterly installments to be paid	$ 11,000,000

BUSINESS COMBINATION (Details Narrative 1) $ in Thousands	9 Months Ended
BUSINESS COMBINATION (Details Narrative 1) $ in Thousands	Sep. 30, 2014 USD ($)
Business Acquisition [Line Items]
Indemnification asset with a corresponding liability	$ 1,500
Manchester Pharmaceuticals Llc
Business Acquisition [Line Items]
Intangible assets with definite lives other than goodwill	72,000
Total allocation of purchase price consideration	73,233
Manchester Pharmaceuticals Llc \| Product Right
Business Acquisition [Line Items]
Intangible assets with definite lives	$ 71,372
Assets useful life	16 years
Manchester Pharmaceuticals Llc \| Trade names
Business Acquisition [Line Items]
Intangible assets with definite lives	$ 175
Assets useful life	1 year
Manchester Pharmaceuticals Llc \| Customer Relationships
Business Acquisition [Line Items]
Intangible assets with definite lives	$ 403
Assets useful life	10 years

MARKETABLE SECURITIES (Details) - USD ($)	Sep. 30, 2014	Dec. 31, 2013
Marketable securities available-for-sale:
Cost	$ 8,220,349	$ 129,702
Unrealized Gains	3,732,622	3,292
Unrealized Losses	22,479
Estimated Fair Value	11,930,492	132,994
Securities sold, not yet purchased
Cost	3,184,572	1,344,622
Unrealized Gains	47,035	13,256
Unrealized Losses	12,876	126,535
Estimated Fair Value	$ 3,150,413	$ 1,457,901

DERIVATIVE FINANCIAL INSTRUMENTS (Details) - Warrant - $ / shares	9 Months Ended	12 Months Ended
	Sep. 30, 2014	Dec. 31, 2013
Derivative [Line Items]
Fair value of common stock	$ 9.02	$ 7.00
Risk-free interest rate		1.39%
Expected volatility	85.00%
Dividend yield	0.00%	0.00%
Minimum
Derivative [Line Items]
Expected life (in years), represents the weighted average period until next liquidity event	9 months	4 years 1 month 13 days
Risk-free interest rate	1.20%
Expected volatility		93.00%
Maximum
Derivative [Line Items]
Expected life (in years), represents the weighted average period until next liquidity event	1 year	4 years 7 months 13 days
Risk-free interest rate	1.69%
Expected volatility		97.00%

DERIVATIVE FINANCIAL INSTRUMENTS (Details Narrative) - Warrant - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Derivative [Line Items]
Recorded gain on change in estimated fair value of warrants	$ 6.4	$ 6.4
Recorded loss on change in estimated fair value of warrants	$ 5.8	$ 5.8	$ 14.3	$ 8.2

FAIR VALUE MEASUREMENTS (Details 1) - USD ($)	Sep. 30, 2014	Dec. 31, 2013
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability related to warrants	$ 18,480,000	$ 25,037,346
Acquisition-related contingent consideration	12,237,930
Recurring basis
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities, available-for-sale	11,930,492	132,994
Derivative liability related to warrants	18,480,000	25,037,346
Securities sold, not yet purchased	3,150,413	1,457,901
Acquisition-related contingent consideration	12,237,930
Recurring basis \| Quoted prices in active markets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities, available-for-sale	11,930,492	132,994
Derivative liability related to warrants
Securities sold, not yet purchased	3,150,413	1,457,901
Acquisition-related contingent consideration
Recurring basis \| Significant other observable inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities, available-for-sale
Derivative liability related to warrants
Securities sold, not yet purchased
Acquisition-related contingent consideration
Recurring basis \| Significant unobservable inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities, available-for-sale
Derivative liability related to warrants	18,480,000	25,037,346
Securities sold, not yet purchased
Acquisition-related contingent consideration	$ 12,237,930

FAIR VALUE MEASUREMENTS (Details 2) - Warrants liability $ in Thousands	9 Months Ended
	Sep. 30, 2014 USD ($)
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance at December 31, 2013	$ 25,037,346
Issuance of common stock warrants, September 30, 2014 (see Note 10)	2,531,250
Reclassification of derivative liability to equity upon exercise of warrants	(23,364,668)
Change in estimated fair value of liability classified warrants	14,276,072
Balance at December 31, 2013	$ 18,480,000

FAIR VALUE MEASUREMENTS (Details 3)	9 Months Ended
FAIR VALUE MEASUREMENTS (Details 3)	Sep. 30, 2014 USD ($)
Fair Value Disclosures [Abstract]
Balance at January 1, 2014
Present value of contractual payments, contingent consideration upon acquisition	12,800,000
Contractual Payments	(562,070)
Balance at September 30, 2014	$ 12,237,930

INTANGIBLE ASSETS (Details) - USD ($)

Sep. 30, 2014

Dec. 31, 2013

Finite-Lived Intangible Assets [Line Items]

Gross Carrying Amount

$ 100,011,312

$ 2,349,775

Accumulated Amortization

(3,791,372)

(323,980)

Finite-Lived Intangible Assets, Net

96,219,940

2,025,795

Product Rights

Finite-Lived Intangible Assets [Line Items]

Gross Carrying Amount

71,372,000

Accumulated Amortization

(2,296,019)

Finite-Lived Intangible Assets, Net

69,075,981

Thiola License

Finite-Lived Intangible Assets [Line Items]

Gross Carrying Amount

15,049,648

Accumulated Amortization

(494,570)

Finite-Lived Intangible Assets, Net

14,555,078

Syntocinon License

Finite-Lived Intangible Assets [Line Items]

Gross Carrying Amount

^[1]

5,000,000

Accumulated Amortization

^[1]

(126,494)

Finite-Lived Intangible Assets, Net

^[1]

4,873,506

Carbetocin Assets

Finite-Lived Intangible Assets [Line Items]

Gross Carrying Amount

^[1]

5,567,736

Accumulated Amortization

^[1]

(285,284)

Finite-Lived Intangible Assets, Net

^[1]

5,282,452

Ligand License

Finite-Lived Intangible Assets [Line Items]

Gross Carrying Amount

2,300,000

Accumulated Amortization

(475,513)

(323,980)

Finite-Lived Intangible Assets, Net

1,824,487

1,976,020

Customer Relationships

Finite-Lived Intangible Assets [Line Items]

Gross Carrying Amount

403,000

Accumulated Amortization

(20,740)

Finite-Lived Intangible Assets, Net

382,260

Trade Name

Finite-Lived Intangible Assets [Line Items]

Gross Carrying Amount

175,000

Accumulated Amortization

(90,137)

Finite-Lived Intangible Assets, Net

84,863

Patent Costs

Finite-Lived Intangible Assets [Line Items]

Gross Carrying Amount

143,928

49,775

Accumulated Amortization

(2,615)

Finite-Lived Intangible Assets, Net

$ 141,313

$ 49,775

[1]	The Company commenced amortization in the second quarter of fiscal 2014 due to a change in estimate.

INTANGIBLE ASSETS (Details Narrative 1) - USD ($)	1 Months Ended	3 Months Ended		9 Months Ended
INTANGIBLE ASSETS (Details Narrative 1) - USD ($)	May 29, 2014	Jun. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Dec. 31, 2013	Dec. 23, 2013	Dec. 12, 2013	Feb. 16, 2012
Finite-Lived Intangible Assets [Line Items]
Develop, manufacture and commercialize a drug technology				$ 96,219,940	$ 2,025,795
Ligand License Agreement
Finite-Lived Intangible Assets [Line Items]
Develop, manufacture and commercialize a drug technology								$ 2,500,000
Syntocinon License Agreement \| Novartis Pharma AG And Novartis AG
Finite-Lived Intangible Assets [Line Items]
Finite Lived Intangible Asset Upfront Fee							$ 5,000,000
Development period		seven to eight years
Patent exclusivity and/or commercial viability period		eleven to twelve years
Assets useful life		20 years
Kyalin Carbetocin Technology Purchase \| Kyalin
Finite-Lived Intangible Assets [Line Items]
Capitalized fixed minimum payments and closing costs						$ 3,000,000
Intangible assets basis stepped up					$ 2,500,000
Carbetocin Asset
Finite-Lived Intangible Assets [Line Items]
Development period			five to seven years
Assets useful life			10 years
Product Right
Finite-Lived Intangible Assets [Line Items]
Develop, manufacture and commercialize a drug technology				$ 69,075,981
Product Right \| Manchester Pharmaceuticals Llc
Finite-Lived Intangible Assets [Line Items]
Assets useful life				16 years
intangible assets with definite lives related to product rights				$ 71,372,000
Trade names
Finite-Lived Intangible Assets [Line Items]
Develop, manufacture and commercialize a drug technology				$ 84,863
Trade names \| Manchester Pharmaceuticals Llc
Finite-Lived Intangible Assets [Line Items]
Assets useful life				1 year
intangible assets with definite lives related to product rights				$ 175,000
Customer Relationships
Finite-Lived Intangible Assets [Line Items]
Develop, manufacture and commercialize a drug technology				$ 382,260
Customer Relationships \| Manchester Pharmaceuticals Llc
Finite-Lived Intangible Assets [Line Items]
Assets useful life				10 years
intangible assets with definite lives related to product rights				$ 403,000
Thiola License Agreement \| Mission Pharmacal Company
Finite-Lived Intangible Assets [Line Items]
Finite Lived Intangible Asset Upfront Fee	$ 3,000,000
Guaranteed minimum royalties	2,000,000
Present value of guaranteed minimum royalties payable				$ 11,800,000
Present value of guaranteed minimum royalties payable (in percent)				20.00%
Capitalized up-front license fee, professional fees, and present value of guaranteed minimum royalties	$ 15,000,000
Thiola License Agreement \| Mission Pharmacal Company \| Other Current Liabilities
Finite-Lived Intangible Assets [Line Items]
Guaranteed minimum royalties				$ 800,000
Thiola License Agreement \| Mission Pharmacal Company \| Other Noncurrent Liabilities
Finite-Lived Intangible Assets [Line Items]
Guaranteed minimum royalties				$ 11,000,000

INTANGIBLE ASSETS (Details Narrative 2) - USD ($)	3 Months Ended		9 Months Ended
INTANGIBLE ASSETS (Details Narrative 2) - USD ($)	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013	Dec. 31, 2013
Finite-Lived Intangible Assets [Line Items]
Net book value of amortizable intangible assets	$ 96,219,940		$ 96,219,940		$ 2,025,795
Amortization expense 2014	5,300,000		5,300,000
Amortization expense 2015	7,100,000		7,100,000
Amortization expense 2016	7,000,000		7,000,000
Amortization expense 2017	7,000,000		7,000,000
Amortization expense 2018	7,000,000		7,000,000
Research and development expenses
Finite-Lived Intangible Assets [Line Items]
Amortization of intangible assets	260,539	$ 0	565,925	$ 0
General and administrative expenses
Finite-Lived Intangible Assets [Line Items]
Amortization of intangible assets	$ 1,600,000	$ 51,065	$ 2,900,000	$ 151,531

NOTES PAYABLE (Details 1) - Note Payable with Detachable Warrants	9 Months Ended
	Sep. 30, 2014 $ / shares
Debt Instrument [Line Items]
Risk free rate	1.62%
Expected volatility	85.00%
Expected life (in years), represents the weighted average period until next liquidity event	4 months 10 days
Expected dividend yield
Exercise Price	$ 12.76

NOTES PAYABLE (Details 2) $ in Millions	Sep. 30, 2014 USD ($)
Debt Disclosure [Abstract]
2014
2015
2016
2017
2018	45
Thereafter	46
Long Term Debt, Total	$ 91

NOTES PAYABLE (Detail Narrative 1)		1 Months Ended	3 Months Ended			9 Months Ended
NOTES PAYABLE (Detail Narrative 1)	Jan. 09, 2014 shares	Mar. 26, 2014 USD ($) Installment	Sep. 30, 2014 USD ($) $ / shares shares	Jun. 30, 2014 USD ($) shares	Sep. 30, 2013 USD ($)	Sep. 30, 2014 USD ($) $ / shares shares	Sep. 30, 2013 USD ($)	May 29, 2014 USD ($)	Mar. 29, 2014 USD ($) $ / shares
Debt Instrument [Line Items]
Number of shares issued to investors \| shares	4,705,882			401,047
Finance expense as other expense related to issuance			$ 12,500			$ 4,720,780
Number of common stock called by warrants \| shares			1,962,377			1,962,377
Grant date fair value of the Warrants recorded as a derivative liability						$ 2,500,000
Interest Expense			$ 2,600,000		$ 0	$ 4,800,000	$ 41,554
Credit Agreement
Debt Instrument [Line Items]
Credit Agreement amount				$ 45,000,000
Number of common stock called by warrants \| shares			337,500			337,500
Exercise price \| $ / shares			$ 12.76			$ 12.76
Convertible Debt \| Note Purchase Agreement
Debt Instrument [Line Items]
Credit Agreement amount								$ 46,000,000
Initial conversion price (in dollars per share) \| $ / shares									$ 17.41
Interest rate								4.50%
Aggregate carrying value									$ 43,000,000
Debt discount									3,000,000
Accrued interest									$ 700,000
Convertible Notes Payable \| Credit Agreement
Debt Instrument [Line Items]
Credit Agreement amount				45,000,000
Debt discount				5,200,000
Aggregate carrying value				$ 39,800,000
Convertible Notes Payable \| Credit Agreement \| LIBOR Rate
Debt Instrument [Line Items]
Debt instrument basis points added				10.00%
Convertible Notes Payable \| Credit Agreement \| Base Rate
Debt Instrument [Line Items]
Debt instrument basis points added				9.00%
Manchester Pharmaceuticals Llc
Debt Instrument [Line Items]
Credit Agreement amount			$ 33,000,000			$ 33,000,000
Manchester Pharmaceuticals Llc \| Promissory Notes Payable
Debt Instrument [Line Items]
Credit Agreement amount		$ 33,000,000
Present value of debt		$ 31,300,000
Effective interest rate		11.00%
Number of installments \| Installment		0
Amount of installment		$ 11,000,000
Accelerated interest expense		$ 1,700,000

COMMITMENTS AND CONTINGENCIES (Details)	Sep. 30, 2014 USD ($)
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]
2014	$ 760,788
2015	1,579,211
2016	1,379,578
2017	632,094
Total	4,351,671
Research and Development and other Charitable Donations
Contractual Obligation, Fiscal Year Maturity [Abstract]
2014	4,586,620
2015	5,790,774
2016	2,651,191
2017	2,374,664
Total	15,403,249
Consultants
Contractual Obligation, Fiscal Year Maturity [Abstract]
2014	183,330
2015
2016
2017
Total	$ 183,330

COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($)				1 Months Ended		9 Months Ended
	Sep. 08, 2014	Jun. 13, 2014	Apr. 10, 2014	Jul. 31, 2014	Feb. 28, 2014	Sep. 30, 2014
Commitment And Contingency [Line Items]
Damages sought		$ 2,500,000				$ 1,500,000
Lease Agreement
Commitment And Contingency [Line Items]
Annual base rent	$ 540,000		$ 537,264	$ 800,000	$ 110,000

STOCKHOLDERS' DEFICIT (Details) - Restricted Shares	9 Months Ended
STOCKHOLDERS' DEFICIT (Details) - Restricted Shares	Sep. 30, 2014 $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Unvested December 31, 2013	168,642
Granted	630,000
Vested	(180,236)
Forfeited/cancelled	(4,155)
Unvested September 30, 2014	614,251
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Unvested December 31, 2013 \| $ / shares	$ 6.44
Granted \| $ / shares	17.08
Vested \| $ / shares	22.66
Forfeited/cancelled \| $ / shares	3
Unvested September 30, 2014 \| $ / shares	$ 15.09
Employee
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Unvested December 31, 2013	130,215
Granted	630,000
Vested	(141,809)
Forfeited/cancelled	(4,155)
Unvested September 30, 2014	614,251
Non Employee
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Unvested December 31, 2013	38,427
Granted
Vested	(38,427)
Forfeited/cancelled
Unvested September 30, 2014

STOCKHOLDERS' DEFICIT (Details 1) - Stock Options	9 Months Ended
STOCKHOLDERS' DEFICIT (Details 1) - Stock Options	Sep. 30, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected volatility	85.00%
Risk free rate	1.55%
Expected life (in years)	5 years 9 months 22 days
Expected dividend yield	0.00%

STOCKHOLDERS' DEFICIT (Details 2) - Stock Options - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2014	Dec. 31, 2013
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Outstanding at December 31, 2013	1,721,000
Granted during 2014	3,705,500
Exercised	(1,833)
Forfeited/cancelled	(720,833)
Outstanding at September 30, 2014	4,703,834	1,721,000
Exercisable as of September 30, 2014	931,083
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract]
Outstanding at December 31, 2013	$ 7.66
Granted during 2014	14.9
Exercised	6.2
Forfeited/cancelled	6.2
Outstanding at September 30, 2014	12.36	$ 7.66
Exercisable as of September 30, 2014	$ 10.57
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract]
Remaining Contractual Term, Outstanding Ending	9 years 6 months 4 days	9 years 10 months 20 days
Remaining Contractual Term, Granted during 2014	10 years 2 months 26 days
Remaining Contractual Term, Forfeited/cancelled	29 days
Remaining Contractual Term, Exercisable	9 years 2 months 8 days
Aggregate Intrinsic Value, Outstanding	$ 1,597,920	$ 172,000
Aggregate Intrinsic Value, Exercisable	$ 770,420

STOCKHOLDERS' DEFICIT (Details 3) - USD ($)	3 Months Ended		9 Months Ended
STOCKHOLDERS' DEFICIT (Details 3) - USD ($)	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total	$ 4,694,471	$ 1,741,908	$ 14,709,101	$ 2,029,505
Restricted Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total	1,931,618	1,667,586	8,444,950	1,918,500
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total	$ 2,762,853	$ 74,322	$ 6,264,151	$ 111,005

STOCKHOLDERS' DEFICIT (Details Narrative 1) - USD ($)		3 Months Ended	9 Months Ended
STOCKHOLDERS' DEFICIT (Details Narrative 1) - USD ($)	Jan. 09, 2014	Jun. 30, 2014	Sep. 30, 2014	Sep. 30, 2013
Equity [Abstract]
Issuance of common stock in public offering, value	4,705,882	401,047
Price per common share	$ 8.50
Net proceeds from the offering	$ 36,800,000		$ 36,835,007	$ 31,355,455
Underwriting fees and other offering costs	$ 3,164,990

STOCKHOLDERS' DEFICIT (Details Narrative 2) - USD ($)	3 Months Ended	9 Months Ended		12 Months Ended
STOCKHOLDERS' DEFICIT (Details Narrative 2) - USD ($)	Sep. 30, 2014	Sep. 30, 2014	Sep. 30, 2013	Dec. 31, 2013
Share-based Compensation		$ 14,709,101	$ 2,029,505
Closing stock, per share		$ 9.02
Number of common stock to issue warrants	1,962,377	1,962,377
Proceeds from issuance for warrants		$ 8,337,380
Reclassification of derivative liability as equity		23,364,668
Employee Stock Option
Share-based Compensation	$ 3,200,000	$ 6,300,000
Weighted-average period unamortized amount		2 years 6 months 11 days
Unamortized amount of stock options expense	25,200,000	$ 25,200,000
Granted during the period, Options		3,705,500
Common Stock
Number of shares repurchased		248,801
Value of shares repurchased		$ 2,300,000
Restricted Stock
Unrecognized compensation cost related to restricted shares issued	$ 7,700,000	$ 7,700,000
Weighted-average period unamortized amount		2 years 22 days		2 years 22 days

SEVERANCE AGREEMENTS (Detail Narrative 1) - Separation Agreement - Chief Financial Officer - USD ($)	1 Months Ended	3 Months Ended
	Sep. 15, 2014	Sep. 30, 2014
Separation Agreement [Line Items]
Percentage of target bonus	100.00%
Accrued severance expenses	$ 90,865
Severance costs		$ 27,151
Severance expense related to accelerated vesting of restricted shares		$ 63,714
Restricted Stock
Separation Agreement [Line Items]
Number of accelerated vesting shares of restricted common stock	81,333

SEVERANCE AGREEMENTS (Detail Narrative 2) - USD ($)		3 Months Ended	9 Months Ended
SEVERANCE AGREEMENTS (Detail Narrative 2) - USD ($)	Oct. 13, 2014	Sep. 30, 2014	Sep. 30, 2014
Mr. Shkreli \| Separation Agreement
Separation Agreement [Line Items]
Cash severance, unpaid bonus and health insurance coverage compensation expense		$ 481,076	$ 481,076
Severance Costs		4,500,000	4,500,000
Mr. Shkreli \| Separation Agreement \| Stock options
Separation Agreement [Line Items]
Severance expense related to accelerated vesting of restricted shares		1,100,000	1,100,000
Subsequent Event \| Turing Pharmaceuticals
Separation Agreement [Line Items]
Up front payment	$ 3,000,000
Subsequent Event \| Mr. Shkreli
Separation Agreement [Line Items]
Accrued severance expenses		$ 2,900,000	$ 2,900,000

SUBSEQUENT EVENTS (Detail Narrative) - shares	Nov. 13, 2014	Sep. 30, 2014
Subsequent Event [Line Items]
Number of common stock called by warrants		1,962,377
Subsequent Event \| Amendment No. 2 to the Credit agreement
Subsequent Event [Line Items]
Number of common stock called by warrants	300,000