1. Nature of the Business
Achillion Pharmaceuticals, Inc. (the “Company”) was incorporated on August 17, 1998 in Delaware. The Company was established to discover, develop and commercialize innovative anti-infective drug therapies. The Company is devoting substantially all of its efforts towards product research and development.
The Company incurred losses of $308,865 from inception through December 31, 2012 and had an accumulated deficit of $322,727 at December 31, 2012, which includes preferred stock dividends recognized until the Company’s initial public offering in 2006. The Company has funded its operations primarily through the sale of equity securities.
The Company believes that its existing cash, cash equivalents and marketable securities will be sufficient to support its current operating plan through at least December 31, 2013. However, the Company’s operating plan may change as a result of many factors, including but not limited to:
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the costs involved in the clinical development, manufacturing and formulation of sovaprevir, ACH-3102 and ACH-2684; |
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the scope of and costs associated with entering cooperative study arrangements, or CSAs, if any, for the collaborative development of our drug candidates with other’s drug candidates in combination; |
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the costs involved in obtaining regulatory approvals for the Company’s drug candidates; |
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the scope, prioritization and number of programs the Company pursues; |
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the costs involved in preparing, filing, prosecuting, maintaining, enforcing and defending patent and other intellectual property claims; |
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the Company’s ability to raise incremental debt or equity capital, including any changes in the credit or equity markets that may impact its ability to obtain capital in the future; |
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the Company’s acquisition and development of new technologies and drug candidates; and |
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competing technological and market developments currently unknown to the Company. |
Certain prior period amounts have been reclassified to conform to the current year’s presentation. The premiums paid on the purchase of marketable securities were reclassified from investing activities to operating activities on the Statement of Cash Flows for the years ended December 31, 2011 and 2010.
Upon adoption of the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2011-05 “Comprehensive Income: Presentation of Comprehensive Income” as of January 1, 2012, the Company has elected the single continuous statement option. As this guidance relates to presentation only, the adoption of this guidance did not have any other effect on the Company’s financial statements.