10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2014

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission file number: 000-52062

Q THERAPEUTICS, INC.

(Exact Name of Registrant as Specified in Its Charter)

Delaware	20-3708500
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification Number)
615 Arapeen Drive, Suite 102 Salt Lake City, UT	84108
(Address of Principal Executive Offices)	(Zip Code)

(801) 582-5400

(Registrant’s Telephone Number, Including Area Code)

N/A

(Former Name, Former Address and Former Fiscal Year, If Changed Since Last Report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” “non-accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	¨  (Do not check if a smaller reporting company)	Smaller reporting company	x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  x

As of May 15, 2014, there were 29,417,363 shares of Common Stock, $0.0001 par value per share, issued and outstanding.

Q Therapeutics, Inc.

(A Development Stage Company)

TABLE OF CONTENTS

PART 1 – FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheets (Unaudited)	1
Condensed Consolidated Statements of Operations (Unaudited)	2
Condensed Consolidated Statements of Cash Flows (Unaudited)	3
Notes to Condensed Consolidated Financial Statements (Unaudited)	5
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	11
Item 3. Quantitative and Qualitative Disclosures about Market Risk	13
Item 4. Controls and Procedures	13
PART II – OTHER INFORMATION
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	13
Item 5. Other Information	14
Item 6. Exhibits	14
Signatures	14

Q Therapeutics, Inc.

(A Development Stage Company)

PART I

Item 1. Financial Statements

Condensed Consolidated Balance Sheets (Unaudited)

	March 31, 2014			December 31, 2013
Assets
Current assets:
Cash	$	284,407		$	142,532
Receivables, net of allowance of $28,800 as of March 31, 2014 and December 31, 2013		—			5,556
Prepaid financing costs, net		—			63,333
Prepaid expenses and other		10,683			10,109
Total current assets		295,090			221,530
Property and equipment, net		31,296			27,999
Other assets		7,513			7,513
Total assets	$	333,899		$	257,042
Liabilities and Stockholders’ Deficit
Current liabilities:
Accounts payable	$	386,838		$	2,364,001
Accrued liabilities		106,192			81,156
Accrued compensation		481,489			353,950
Notes payable		400,000			500,000
Derivative liability		99,344			—
Total current liabilities		1,473,863			3,299,107
Commitments and contingencies
Stockholders’ deficit:
Common stock, $0.0001 par value: 100,000,000 shares authorized; 27,869,863 and 24,936,833 shares outstanding as of March 31, 2014 and December 31, 2013 , respectively		2,787			2,494
Additional paid-in capital		23,908,526			20,836,811
Accumulated deficit		(25,051,277	)		(23,881,370	)
Total stockholders’ deficit		(1,139,964	)		(3,042,065	)
Total liabilities and stockholders’ deficit	$	333,899		$	257,042

See accompanying notes to condensed consolidated financial statements.

1

Q Therapeutics, Inc.

(A Development Stage Company)

Condensed Consolidated Statements of Operations (Unaudited)

	For the Three Months Ended						Cumulative From Inception
	March 31, 2014			March 31, 2013
Grant revenues	$	—		$	5,501		$	1,104,434
License fees and other revenues		—			—			294,900
Total operating revenues		—			5,501			1,399,334
Cost of revenues		—			—			4,800
Gross profit		—			5,501			1,394,534
Operating expenses:
Research and development		484,144			131,109			13,284,569
General and administrative		583,862			374,719			11,087,809
Total operating expenses		1,068,006			505,828			24,372,378
Operating loss		(1,068,006	)		(500,327	)		(22,977,844	)
Other income (expense):
Interest income		—			—			187,616
Interest expense		(102,417	)		(325	)		(2,415,942	)
Other income, net		516			1,373			154,893
Total other income (expense), net		(101,901	)		1,048			(2,073,433	)
Loss before provision (benefit) for income taxes		(1,169,907	)		(499,279	)		(25,051,277	)
Provision (benefit) for income taxes		—			—			—
Net loss	$	(1,169,907	)	$	(499,279	)	$	(25,051,277	)
Weighted average number of common shares outstanding - basic and diluted		25,017,018			24,778,221
Net loss per common share - basic and diluted	$	(0.05	)	$	(0.02	)

See accompanying notes to condensed consolidated financial statements.

2

Q Therapeutics, Inc.

(A Development Stage Company)

Condensed Consolidated Statements of Cash Flows (Unaudited)

	For the Three Months Ended						Cumulative From Inception
	March 31, 2014			March 31, 2013
Cash flows from operating activities:
Net loss	$	(1,169,907	)	$	(499,279	)	$	(25,051,277	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		2,318			4,337			405,812
Original debt discount		63,333			—			513,333
Accretion of debt costs and beneficial conversion feature		—			—			1,423,930
Stock-based compensation		248,822			25,438			782,376
Debt issued for services		—			—			90,000
Common stock issued for services		24,500			25,001			356,250
Preferred stock issued for services		—			—			44,750
Warrants issued for services		—			8,162			78,370
Provision for losses on receivables		—			—			(43,677	)
Decrease (increase) in:
Receivables		5,556			475,968			43,677
Prepaid expenses and other assets		(574	)		709			(18,196	)
Increase (decrease) in:
Accounts payable and accrued liabilities		355,903			(187,563	)		3,200,179
Accrued compensation		127,539			26,923			481,489
Net cash used in operating activities		(342,510	)		(120,304	)		(17,692,984	)
Cash flows from investing activities:
Purchase of property and equipment		(5,615	)		(19,851	)		(436,888	)
Cash flows from financing activities:
Proceeds from issuance of notes payable		—			—			5,507,562
Payments on short-term note payable		—			—			(90,000	)
Issuance of preferred stock for cash		—			—			8,671,747
Issuance of common stock for cash		490,000			—			4,311,137
Proceeds from exercise of common stock options		—			—			11,600
Proceeds from exercise of preferred stock warrants		—			—			2,233
Net cash provided by financing activities		490,000			—			18,414,279
Net increase (decrease) in cash		141,875			(140,155	)		284,407
Cash as of beginning of the period		142,532			794,207			—
Cash as of end of the period	$	284,407		$	654,052		$	284,407
Supplemental disclosure of cash flow information:
Cash paid for interest	$	214		$	325		$	8,894

See accompanying notes to condensed consolidated financial statements.

3

Q Therapeutics, Inc.

(A Development Stage Company)

Condensed Consolidated Statements of Cash Flows (Unaudited) Continued

Supplemental disclosure of noncash investing and financing activities for the period from March 28, 2002 (date of inception) to March 31, 2014:

• The Company issued 219,658 shares of common stock in exchange for technology valued at $220.

• The Company converted $1,050,000 of notes payable and $29,691 of accrued interest to 482,008 shares of Series A2 preferred stock.

• The Company converted $3,740,000 of notes payable and $370,346 of accrued interest to 1,787,104 shares of Series B preferred stock.

• The Company recorded a debt discount of $1,237,263 related to preferred stock warrants issued with debt and the beneficial conversion feature.

• The Company converted $900,000 of bridge notes payable and $16,644 of accrued interest to 916,644 shares of common stock.

• The Company converted 250,000 shares of Series A1 preferred stock, 2,022,190 shares of Series A2 preferred stock, and 4,102,654 shares of Series B preferred stock to 13,791,231 shares of common stock.

• Two stockholders forfeited, and the Company retired, 200,000 shares of common stock with a net impact on equity of $19 as a result of untimely payments on their notes.

• The Company received $250,000 in cash proceeds in exchange for notes payable of $500,000.

• The Company converted $2,304,030 of accounts payable and $104,000 of notes payable into an aggregate of 2,408,030 shares of common stock.

See accompanying notes to condensed consolidated financial statements.

4

Q Therapeutics, Inc.

(A Development Stage Company)

Notes to Condensed Consolidated Financial Statements (Unaudited)

1. Organization

Q Therapeutics, Inc. (Q Therapeutics) conducts its operations through its wholly owned subsidiary, Q Therapeutic Products, Inc. (Q Products), and its wholly owned subsidiary, NeuroQ Research, Inc. (collectively, the Company). Q Therapeutics is a Salt Lake City, Utah-based biopharmaceutical company that is developing human cell-based therapies intended to treat degenerative diseases of the brain and spinal cord, the primary components of the central nervous system (CNS). Q Products was incorporated in the state of Delaware on March 28, 2002, and merged with Q Acquisition, Inc., a Delaware corporation and a wholly owned subsidiary of Grace 2, Inc., on October 13, 2011. Grace 2, Inc. was incorporated on October 27, 2005. On November 2, 2011, Grace 2 changed its name to Q Holdings, Inc., and on December 10, 2012, it changed its name to Q Therapeutics, Inc.

These potential therapies are based on our technology developed by Q Products’ co-founder Mahendra Rao, M.D., Ph.D., a leader in glial stem cell biology, during his tenure at the University of Utah and as Head of the Stem Cell Section in the Laboratory of Neuroscience at the National Institutes of Health (NIH). Dr. Rao was one of the first scientists to identify and seek patent coverage on stem cells and their progeny cells found in the CNS. After licensing Dr. Rao’s technology from the University of Utah and NIH, Q Products commenced operations in the spring of 2004 to develop cell-based therapeutic products that can be sold as “off-the-shelf” pharmaceuticals.

2. Significant Accounting Policies

The following significant accounting policies are followed by the Company in preparing its condensed consolidated financial statements:

Basis of Presentation and Consolidation

These unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in the Company’s Form 10-K filed with the Securities and Exchange Commission (SEC) on April 15, 2014. The results of operations for the three-month period ended March 31, 2014 are not necessarily indicative of the results to be expected for the full year ending December 31, 2014. In the opinion of management, all adjustments that are necessary for a fair presentation of the financial information for the interim periods reported have been made. All such adjustments are of a normal recurring nature.

The accompanying unaudited condensed consolidated financial statements have been prepared by management in accordance with U.S. generally accepted accounting principles (US GAAP), and include all assets and liabilities of Q Therapeutics and its wholly owned subsidiary, Q Products. All material intercompany transactions and balances have been eliminated.

Development Stage and Liquidity

For the period from March 28, 2002 (date of inception) through March 31, 2014, the Company has not generated significant revenues and has been developing its products. Therefore, the Company is considered to be in the development stage in accordance with the provisions of Accounting Standards Codification (ASC) Topic 915, Development Stage Entities. Cumulative amounts are presented for the period from March 28, 2002 (date of inception) through March 31, 2014. Historically, the Company has been dependent on government grants and debt and equity raised from individual investors to sustain its operations. The Company’s continued operations will depend on its ability to raise funds through various sources such as government grants and equity and debt financing. The Company expects to continue to fund operations through similar sources of capital previously described. There can be no assurance that such capital will be available on favorable terms or at all. If it is unable to raise additional capital, the Company will likely be forced to curtail desired development activities, which will delay the development of its product candidates. The Company’s products have not been approved by the U.S. Food and Drug Administration (FDA) for commercial sale; therefore, the Company has not generated revenues from commercial therapeutic product sales. The Company has incurred losses and used cash for operating activities since inception. As of March 31, 2014, the Company had an accumulated deficit of $25,051,277.

2014 Financing Transactions

Between March 7 and April 14, 2014, the Company issued an aggregate of 4,420,530 units, each containing one share of the Company’s common stock and one warrant to purchase one share of the Company’s common stock, resulting from two tranches of financing in which the Company received cash consideration of $2,012,500 and settled indebtedness of $2,408,030 (2014 Financing

5

Q Therapeutics, Inc.

(A Development Stage Company)

Notes to Condensed Consolidated Financial Statements (Unaudited) Continued

Transactions). The warrants were issued at an initial exercise price of $1.00 per share, are immediately exercisable, and expire in no more than four years. Both the shares of common stock and the warrants have a down-round provision provided to the stockholders in the event that the Company does another offering of units, which consists of one share of common stock and one warrant to purchase one share of common stock, at a price below $1.00 per share. The down-round provision expires upon the earlier of the effectiveness of a registration statement with the SEC or one year after the issuance date.

Use of Estimates

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosures of contingent assets and liabilities as of the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Accordingly, actual results could differ from those estimates. Key estimates include allowances for doubtful accounts receivable, useful lives for property and equipment, valuation allowances for net deferred income tax assets, and valuations for stock-based compensation awards. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances.

Revenue Recognition and Grants Receivable

The Company periodically applies for research grants, including as a sub-recipient to grants funded by government agencies through research universities. Grant revenues are recognized as associated expenses are incurred and are billed in conjunction with the terms of the grants. The Company records its grants receivable in accordance with the provisions of the grant agreements. The Company’s grants receivable are considered past due when payment has not been received within 30 days of the invoice date, although certain institutions customarily do not pay within these terms. The amounts of the specific reserves are estimated by management based on various assumptions including the age of the individual receivable, as well as changes in payment schedules and histories. Receivable balances are charged off against the allowance for doubtful accounts when management determines the potential for recovery is remote. Recoveries of receivables previously charged off are recorded when payment is received.

In December 2012, the Company was notified of a sub-award as part of grant funding awarded to The Johns Hopkins University (JHU) from the National Institute of Neurological Disorders and Stroke (NINDS) of the National Institutes of Health. The sub-award for the 2012-2013 grant plan year is $631,383. In May 2013, JHU applied for, and was granted a six-month extension for completing the analysis and remitting data and expenses. As of March 31, 2014, the 2012-2013 grant plan year was closed. The Company is awaiting the notification of the award for year 4. As of March 31, 2014, there are no amounts outstanding related to this sub-award.

Stock-Based Compensation

The Company calculates the estimated fair value of its stock options and warrants on the grant date using the Black-Scholes option-pricing model. The Company recognizes stock-based compensation expense as services are provided, which is generally over the vesting period of the individual equity instruments. Expense related to stock options issued in lieu of cash to non-employees for services performed are measured at the fair value of the options on the date they are earned.

The volatility assumption used in the Black-Scholes option-pricing model is based on the volatility of publicly traded companies in the same industry segment as the Company. The expected lives of the options and warrants granted represent the periods of time that the options granted are expected to be outstanding. The risk free rates for periods within the contractual lives of the options and warrants are based on the U.S. treasury securities constant maturity rate that corresponds to the expected terms in effect at the time of grant. Stock-based compensation is included in general and administrative expense in the statements of operations.

Net Loss Per Common Share

Basic net income or loss per common share (Basic EPS) is computed by dividing net income or loss by the weighted average number of common shares outstanding. Diluted net income or loss per common share (Diluted EPS) is computed by dividing net income or loss by the sum of the weighted average number of common shares outstanding and the dilutive potential common share equivalents then outstanding. Potential dilutive common share equivalents consist of shares issuable upon the exercise of outstanding stock options and warrants to acquire common stock.

Due to the fact that for all periods presented the Company has incurred net losses, potential dilutive common share equivalents as of March 31, 2014 and 2013, totaling 21,437,251 and 15,907,458, respectively, are not included in the calculation of Diluted EPS because they are anti-dilutive. Therefore, basic net loss per common share is the same as diluted net loss per common share for the three months ended March 31, 2014 and 2013.

6

Q Therapeutics, Inc.

(A Development Stage Company)

Notes to Condensed Consolidated Financial Statements (Unaudited) Continued

Recent Accounting Pronouncements

The Company has reviewed accounting pronouncements that become effective subsequent to March 31, 2014 and does not believe the future adoption of those pronouncements will have a material impact on the Company’s financial position, results of operations or liquidity.

3. Accounts Payable

On March 7, 2014, the Company settled through the issuance of common units indebtedness of $2,408,030, of which $2,304,030 was previously classified as accounts payable (see Note 2).

4. Accrued Compensation

Accrued compensation consists of the following:

	March 31, 2014		December 31, 2013
Accrued wages	$	394,351	$	278,393
Accrued vacation expense		87,138		75,557
Total accrued compensation	$	481,489	$	353,950

Starting in March 2013, certain of the Company’s executives agreed to defer part, if not all, of their salaries until additional funding is obtained.

5. Notes Payable

Between August 12 and September 30, 2013, the Company received $250,000 in cash proceeds resulting from a bridge financing by certain note holders, some of which were also considered affiliates, as evidenced by promissory notes. The notes were issued at 50% of face value, bore interest at the rate of 8% per annum, and matured beginning February 5, 2014.

In February 2014, the largest note holder agreed to extend the maturity date for its $400,000 note for an additional 180 days, in exchange for certain call right language being removed from warrants the note holder had acquired in 2011. On March 7, 2014, the remaining note holder converted its note totaling $104,000, including interest, into units consisting of one share of common stock and one warrant to purchase a share of common stock as part of the 2014 Financing Transactions (see Note 2).

To date, the Company has recorded interest relating to the notes of $273,733, of which $250,000 pertained to the amortization of the debt discount. As of March 31, 2014, the debt discount has been fully amortized. Notes payable as of March 31, 2014 were $400,000.

The effective interest rate related to this financing is approximately 156%.

6. Derivative Liability

In connection with the first tranche of the 2014 Financing Transactions, the Company issued 2,898,030 common units, each unit consisting of one share of common stock and one warrant to purchase one share of common stock (see Note 2), and recorded a derivative liability related to down-round protection provided to the stockholders in the event that the Company does another offering of units, similar to those issued in the 2014 Financing Transactions, at a price below $1.00 per share. The down-round provision expires upon the earlier of the effectiveness of a registration statement with the SEC or one year after the issuance date. With the assistance of a third-party valuation specialist, the Company valued the derivative liability pursuant to the accounting guidance of ASC 820-10, Fair Value Measurements.

Fair values for warrants and common stock are determined using the Monte-Carlo Simulation Model valuation technique. The Monte-Carlo Simulation Model valuation model provides for dynamic assumptions regarding volatility and risk-free interest rates within the total period to expected conversion. In addition, management assessed the probabilities of future financing assumptions.

7

Q Therapeutics, Inc.

(A Development Stage Company)

Notes to Condensed Consolidated Financial Statements (Unaudited) Continued

As defined in FASB ASC 820-10, fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In order to increase consistency and comparability in fair value measurements, FASB ASC 820-10 establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below:

Level 1	Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities.
Level 2	Other inputs that are observable directly or indirectly, such as quoted prices for similar assets and liabilities or market corroborated inputs.
Level 3	Unobservable inputs that are used when little or no market data is available, which require the Company to develop its own assumptions about how market participants would value the assets or liabilities.

Determining which category an asset or liability falls within the hierarchy requires significant judgment. The Company evaluates its hierarchy disclosure each quarter. Assets and liabilities measured at fair value on a recurring basis as of March 31, 2014 are summarized as follows:

	Fair Value as of March 31, 2014
	Level 1		Level 2		Level 3		Total
Derivative liability	$	—	$	—	$	99,344	$	99,344

The following table presents the fair value reconciliation of Level 3 liabilities measured at fair value on a recurring basis during the three months ended March 31, 2014.

	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	Derivative
Beginning balance, December 31, 2013	$	—
Issuances:
Derivatives liability related to down-round provision of common stock units		99,344
Ending balance, March 31, 2014	$	99,344

Given the nature of the derivative liability, the carrying amount of $99,344 as of March 31, 2014, was derived from Level 3 inputs and represent management’s best estimate of fair value.

7. Stockholders’ Equity

Common Stock

On March 7, 2014, the Company issued 2,898,030 units, each consisting of one share of common stock and one warrant to purchase one share of common stock, to individual investors as part of the 2014 Financing Transactions (see Note 2). The units have a down-round provision to the stockholders in the event that the Company sells units similar to those in the previous offering at a price below $1.00 per share. The down-round provision expires upon the earlier of the effectiveness of a registration statement with the SEC or one year after the issuance date.

8

Q Therapeutics, Inc.

(A Development Stage Company)

Notes to Condensed Consolidated Financial Statements (Unaudited) Continued

Additionally during the quarter ended March 31, 2014, the Company issued an aggregate of 35,000 shares of its common stock in lieu of cash for services and for technology acquired from a collaborative partner. As of March 31, 2014, 27,869,863 shares of common stock are outstanding.

Stock Options

The following summarizes the outstanding common stock options and related activity for the three months ended March 31, 2014:

	Number of Options		Weighted Average Exercise Price Per Share		Weighted Average Remaining Life (Years)
Outstanding as of December 31, 2013		3,865,440	$	0.34		6.98
Granted		2,319,263		0.70		9.95
Exercised		—		—
Forfeited		—		—
Outstanding as of March 31, 2014		6,184,703		0.48		7.39
Exercisable as of March 31, 2014		4,201,370		0.34		6.27

As of March 31, 2014, options to purchase 1,668,266 shares of common stock under the Plan were available for future grant. The following summarizes information about stock options outstanding as of March 31, 2014:

Exercise Price	Number of Options Outstanding		Weighted Average Remaining Contractual Life (Years)		Weighted Average Exercise Price		Number of Options Exercisable		Weighted Average Exercise Price
$ 0.06 - $0.08		902,600		5.13	$	0.08		902,600	$	0.08
$ 0.15 - $0.19		2,072,840		5.32		0.17		2,072,840		0.17
$0.70		2,319,263		9.95		0.70		707,597		0.70
$1.00		890,000		7.84		1.00		518,333		1.00
		6,184,703		7.39		0.48		4,201,370		0.34

As of March 31, 2014, the aggregate intrinsic value of outstanding and exercisable stock options was $3,245,404 and $2,761,905, respectively.

Stock-based compensation for the three months ended March 31, 2014 and 2013 was $248,822 and $25,438, respectively. As of March 31, 2014, the Company had $696,499 of unrecognized stock-based compensation expense related to non-vested awards that is expected to be recognized over a weighted-average period of 2.89 years.

9

Q Therapeutics, Inc.

(A Development Stage Company)

Notes to Condensed Consolidated Financial Statements (Unaudited) Continued

The fair value of each stock-based compensation award granted during the three months ended March 31, 2014 was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions:

Risk-free interest rate	2.07%
Expected stock price volatility	71.05%
Expected dividend yield	0%
Expected life of options	6.26 years

Warrants

In January 2014, the Company issued a warrant to purchase 50,000 shares of common stock to a business consulting firm (see Note 8).

On March 7, 2014, the Company issued warrants to purchase 2,898,030 shares of common stock as a result of the first tranche of the 2014 Financing Transactions (see Note 2). The warrants have an initial exercise price of $1.00 per share, have up to a four-year life, are exercisable immediately, and have down-round protection in the event that the Company subsequently sells similar units at a price less than $1.00 per share (see Note 6).

As of March 31, 2014, 15,252,548 warrants to purchase common stock had been issued and were outstanding with exercise prices ranging from $.046 to $2.75 per share and terms ranging from two to seven years. The weighted average warrant exercise price is $1.33 and the weighted average remaining life is 4.16 years.

8. Commitments and Contingencies

Advisory Agreements

In July 2013, the Company entered into a business consulting services agreement effective through December 31, 2015. Under the agreement, the Company issued an initial payment of a warrant to purchase 75,000 shares of common stock at an exercise price of $1.01 per share, with a five-year life and a cashless exercise option. In January 2014, the Company issued an additional warrant to purchase 50,000 shares of common stock with similar terms to the initial issuance. Under the agreement, the business consulting firm is entitled to receive additional warrants for up to 50,000 shares of common stock with similar terms.

In May 2014, the Company and its investor relations firm amended their service agreement such that the consulting firm will receive 25,000 shares of the Company’s common stock each quarter in lieu of cash for services rendered. As of March 31, 2014, 25,000 shares of common stock have been issued under this amendment.

9. Subsequent Events

On April 14, 2014, the Company received $1,522,500 from the second tranche of the 2014 Financing Transactions. The Company issued 1,522,500 units consisting of one share of common stock and one warrant to purchase common stock (see Note 2). The terms of the warrants are similar to those issued in the first tranche of the 2014 Financing Transactions (see Note 7).

10

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS

The following discussion contains forward-looking statements based upon current expectations that involve risks and uncertainties, such as our plans, objectives, expectations and intentions. Our actual results and the timing of events could differ materially from those anticipated as a result of a number of factors, including those set forth under the Risk Factors, Cautionary Notice Regarding Forward-Looking Statements and Business sections in our 2013 Annual Report on Form 10-K filed with the Securities and Exchange Commission. The following discussion of our financial condition and results of operations should be read with our unaudited consolidated financial statements and the related notes included elsewhere in this Form 10-Q. We use words such as “anticipate,” “estimate,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “believe,” “intend,” “may,” “will,” “should,” “could,” and similar expressions to identify forward-looking statements.

Company Overview

Q Therapeutics, Inc. (hereinafter Q Therapeutics or the Company) conducts its business and operations through its wholly owned subsidiary, Q Therapeutic Products, Inc. (hereinafter Q Products) and Q Products’ wholly owned subsidiary, NeuroQ Research, Inc. Q Therapeutics is a Salt Lake City, Utah-based biopharmaceutical company that is developing human cell-based therapies intended to treat degenerative diseases of the brain and spinal cord, the primary components of the central nervous system (CNS). Q Therapeutics was incorporated in the state of Delaware on October 27, 2005. Q Products was incorporated in the state of Delaware on March 28, 2002.

These therapies are based upon the technology developed by Q Products’ co-founder, Mahendra Rao, M.D., Ph.D., a global leader in glial stem cell biology, during Dr. Rao’s tenure as a Professor at the University of Utah and as Head of the Stem Cell Section in the Laboratory of Neuroscience at the National Institutes of Health (NIH) Institute of Aging. Dr. Rao was one of the first scientists to identify and seek patent coverage on stem cells and their progeny cells found in the CNS. After licensing Dr. Rao’s technology from the University of Utah and NIH, Q Products commenced operations in the spring of 2004 to develop cell-based therapeutic products that can be sold as “off -the-shelf” pharmaceuticals.

Objectives of Q Therapeutics

Every year, hundreds of thousands of people suffer with debilitating neurodegenerative diseases of the brain and spinal cord. Q Therapeutics’ primary business objective is to develop and commercialize novel therapeutic products to treat these diseases as they represent areas of significant clinical need and commercial opportunity. Q Therapeutics is advancing its initial product, trademarked “Q-Cells®” to the market to treat Amyotrophic Lateral Sclerosis (Lou Gehrig’s disease or ALS), and eventually other indications, potentially including Multiple Sclerosis (MS), Transverse Myelitis (TM), Spinal Cord Injury (SCI), Stroke, Huntington’s Disease, Parkinson’s Disease and Alzheimer’s disease.

Q-Cells are healthy human glial cells. The role of glial cells in the brain and spine is to support and protect neurons, which form the signal transmission lines of the CNS. Glial cells perform many functions including forming an insulating “myelin sheath” around neuronal axons providing the necessary growth factors needed to maintain a healthy nervous system, and removing compounds that are toxic to neurons. Many neurodegenerative diseases arise when glial cells are damaged or destroyed, causing neurons to malfunction and eventually die. Q-Cells technology aims to treat neurodegenerative diseases by supplementing the damaged or missing glia in the CNS with new, healthy cells that can help maintain and/or restore neuron function to a more robust state.

The diseases targeted by Q Therapeutics’ products are not well treated with current drug therapies. At best, patients suffering from these diseases can, in some cases, only hope to slow their inexorable progression and the associated disabilities. A handful of companies are exploring the possibility of harnessing the power of stem or progenitors cells to treat these conditions, although no clear leader has emerged. In addition to utilizing its proprietary cellular products as therapeutic products, Q Therapeutics may evaluate novel ways to utilize these cells to screen for new drugs (such as small molecule compounds) that could also provide treatments for neurological diseases.

Initially, Q Therapeutics is targeting orphan diseases where the U.S. Food and Drug Administration (FDA) can allow fast-track approvals and market exclusivity, and for which smaller, less-expensive clinical trials may be warranted. This approach can result in accelerated commercialization efforts while maintaining a financing approach focused on capital efficiency.

Q Therapeutics believes that a worldwide market exists for those companies whose cell-based treatments become commercial products. Q Therapeutics’ patent protected technology represents an opportunity to build on the recent advancements in the cell therapy field and bring to market a therapeutic approach that will change the way medicine is practiced in treating many disabling and fatal conditions of the CNS.

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Results of Operations for the Three Months Ended March 31, 2014 compared to the Three Months Ended March 31, 2013:

For the period from March 28, 2002 (date of inception) through March 31, 2014, we have not generated significant revenues and have been focused on developing our products for therapeutic use for commercial sale. Q Therapeutics is considered to be a development stage company.

We have not generated revenues in excess of expenses and have been dependent on government grants and debt and equity raised from investors to sustain our operations. Our products have not yet been approved by the FDA for commercial sale, and as a result we have not generated revenues from therapeutic product sales. We have incurred losses and used cash in operating activities since inception. As of March 31, 2014, the Company had an accumulated deficit of $25,051,277 and negative working capital of $1,178,773.

Revenues

The Company has generated minimal revenues through (1) research grants from foundations and government agencies such as the National Institutes of Health (NIH), (2) granting rights to the Company’s technology to other entities, and (3) sales of its products for research purposes.

Grant revenues for the three months ended March 31, 2014 and 2013 were $0 and $5,501, respectively. Grant revenues consisted of a sub-award we received as part of a grant awarded to The Johns Hopkins University. We anticipate grant revenues to increase when the year 4 funding of the NIH grant is approved.

Research and Development Expenses

Q Therapeutics anticipates that development activities and costs will remain approximately the same as we advance the work necessary to complete our future Investigational New Drug (IND) submission. This includes Good Laboratory Practices (GLP) animal safety studies, injection device studies, manufacturing activities and working with clinical and regulatory consultants. Should additional financing be obtained, we may also increase research and development activities to evaluate use of our proprietary products in other disease indications, including working with outside collaborators.

Research and development expenses for the three months ended March 31, 2014, were $481,144, an increase of $353,035, or 267%, from $131,109 for the three months ended March 31, 2013. The increase is primarily due to the one-time costs associated with the commencement of a large animal safety study. We anticipate research and development expenses to remain at approximately the same levels, or increase as necessary, as we progress towards commercializing our product candidates.

General and Administrative Expenses

General and administrative expenses for the three months ended March 31, 2014 were $583,862, an increase of $209,143, or 56%, from $374,719 for the three months ended March 31, 2013. The increase is primarily related to stock-based compensation expense resulting from director, officer and employee option grants of $223,384 offset, in part, by a decrease in legal and professional fees of $16,859. We anticipate general and administrative expenses to remain at approximately the same levels going forward.

Liquidity and Capital Resources

For the three months ended March 31, 2014, net cash used in operating activities totaled $342,510 compared to $120,304 for the three months ended March 31, 2013. Cash outflows increased in 2014 primarily due to increases in research and development expenses

For the three months ended March 31, 2014, net cash used in investing activities related to the purchase of lab and computer equipment of $5,615 compared to $19,851 for the three months ended March 31, 2013.

For the three months ended March 31, 2014, net cash provided by financing activities was $490,000 compared to $0 for the three months ended March 31, 2013. Cash provided by financing activities was sourced from the 2014 Financing Transactions.

As of March 31, 2014, the Company had negative working capital of $1,178,773.

Between March 7 and April 14, 2014, the Company received $2,012,500 in cash proceeds from two separate tranches of the 2014 Financing Transactions.

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We believe that our current levels of cash, when combined with (1) our expected cash flows from grant revenues, and (2) reductions to our current operating expenses, will be sufficient to meet our liquidity needs through at least December 31, 2014. However, we will need additional cash resources in the future if we pursue opportunities for investment, acquisition, strategic cooperation or other similar actions. To satisfy future cash requirements, we expect to seek funding through government grants, the issuance of debt or equity securities and/or the obtaining of a credit facility. Any future issuance of equity securities would cause dilution for our stockholders. Any incurrence of indebtedness will increase our debt service obligations and may cause us to be subject to restrictive operating and financial covenants. It is possible that we will be unsuccessful securing future government grants and financing may not be available to us in amounts or on terms that are favorable to the Company or not available at all.

Subsequent Events

On April 14, 2014, we received $1,522,500 from the second tranche of the 2014 Financing Transactions. The Company issued 1,522,500 units consisting of one share of common stock and one warrant to purchase common stock. The terms of the warrants are similar to those issued in the first tranche of the 2014 Financing Transactions.

Recent Accounting Pronouncements

The Company has reviewed recently issued, but not yet effective, accounting pronouncements and does not believe the future adoption of any such pronouncements will have a material impact on the Company’s financial position, results of operations, or liquidity.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements.

Significant Accounting Policies

Significant accounting policies are those policies which are both important to the presentation of a company’s financial condition and results of operations and require management’s most subjective or complex judgments. Often estimates are required to be made about matters that are inherently uncertain. No significant changes to our accounting policies occurred during the periods presented. For a further discussion of our significant accounting policies, see our Annual Report on Form 10-K for the year ended December 31, 2013.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

None.

Item 4. Controls and Procedures.

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our filings under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the periods specified in the rules and forms of the SEC. This information is accumulated and communicated to our executive officers to allow timely decisions regarding required disclosure. Our Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based upon that evaluation, our Chief Executive Officer and the Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of March 31, 2014.

No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934) occurred during the quarter ended March 31, 2014 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

On April 28, 2014, the Company agreed to issue to a service provider in return for services rendered, 25,000 shares of restricted common stock, beginning with the first quarter of 2014 and each quarter thereafter, until such time as the Company has completed a financing of at least $7,500,000.

On March 17, 2014, the Company issued 10,000 shares of restricted common stock to a collaborative partner upon execution of a licensing agreement.

13

Additionally, on January 1, 2014, the Company issued 50,000 warrants to a consulting firm for services rendered.

In connection with the issuance of the common stock and the warrants to acquire shares of common stock described above, the Company relied upon Section 4(2) of the Securities Act of 1933, as amended, as transactions by an issuer not involving any public offering. For each such transaction, the Company did not use general solicitation or advertising to market the securities, the securities were offered to a limited number of persons, the investors had access to information regarding the Company (including information contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012, Quarterly Reports on Form 10-Q for the periods ended March 31, 2013, June 30, 2013 and September 30, 2013 and Current Reports on Form 8-K filed with the Securities and Exchange Commission and press releases made by the Company), and management of the Company was available to answer questions by prospective investors. The Company reasonably believes that each of the investors is an accredited investor.

Item 5. Other Information.

None.

Item 6. Exhibits.

Index to Exhibits

Exhibit	Description
31.1(1)	Certification of the Company’s Principal Executive Officer pursuant to 15d-15(e) under the Securities and Exchange Act of 1934, as amended, with respect to the registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2014.
31.2(1)	Certification of the Company’s Principal Financial and Accounting Officer pursuant to 15d-15(e) under the Securities and Exchange Act of 1934, as amended, with respect to the registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2014.
32.1*	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Principal Executive Officer ) and (Principal Financial and Accounting Officer).
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema
101.CAL	XBRL Taxonomy Extension Calculation Linkbase
101.DEF	XBRL Taxonomy Extension Definition Linkbase
101.LAB	XBRL Taxonomy Extension Label Linkbase
101.PRE	XBRL Taxonomy Presentation Linkbase

(1) Filed herewith.

* Furnished herewith.

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: May 15, 2014	By:	/s/ DEBORAH A. EPPSTEIN
	Name:	Deborah A. Eppstein, PhD
	Title:	Chief Executive Officer, President
		(Principal Executive Officer)
Date: May 15, 2014	By:	/s/ STEVEN J. BORST
	Name:	Steven J. Borst
	Title:	Vice President, Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)

14

EX-31.1

EXHIBIT 31.1

Certification of the Company’s Principal Executive Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and Securities and Exchange Commission Release 34-46427

I, Deborah A. Eppstein, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Q Therapeutics, Inc. for the fiscal quarter ended March 31, 2014.

2. Based on my knowledge, this report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 15, 2014	By:	/s/ DEBORAH A. EPPSTEIN
	Name:	Deborah A. Eppstein, PhD
	Title:	Chief Executive Officer, President
		(Principal Executive Officer)

EX-31.2

EXHIBIT 31.2

Certification of the Company’s Principal Financial and Accounting Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and Securities and Exchange Commission Release 34-46427

I, Steven J. Borst, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Q Therapeutics, Inc. for the fiscal quarter ended March 31, 2014.

2. Based on my knowledge, this report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 15, 2014	By:	/s/ STEVEN J. BORST
	Name:	Steven J. Borst
	Title:	Chief Financial Officer, VP Corporate Development
		(Principal Financial and Accounting Officer)

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Deborah A. Eppstein, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Form 10-Q of Q Therapeutics, Inc. for the quarter ended March 31, 2014, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Form 10-Q fairly presents in all material respects, the financial condition and results of operations of Q Therapeutics, Inc.

Date: May 15, 2014	By:	/s/ DEBORAH A. EPPSTEIN
		Deborah A. Eppstein, PhD
		Chief Executive Officer, President
		(Principal Executive Officer)

I, Steven J. Borst, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Form 10-Q of Q Therapeutics, Inc. for the quarter ended March 31, 2014, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Form 10-Q fairly presents in all material respects, the financial condition and results of operations of Q Therapeutics, Inc.

Date: May 15, 2014	By:	/s/ STEVEN J. BORST
		Steven J. Borst
		Chief Financial Officer, VP Corporate Development
		(Principal Financial and Accounting Officer)

* This certification shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section, nor shall it be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934.

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Derivative Liability (Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis) (Details) (Fair Value Inputs Level 3 [Member], USD $)	Mar. 31, 2014	Dec. 31, 2013
Fair Value Inputs Level 3 [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Derivative liability related to down round provision of common stock units	$ 99,344

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Accrued Compensation

3 Months Ended

Mar. 31, 2014

Accrued Compensation [Abstract]

Accrued Compensation

4. Accrued Compensation

Accrued compensation consists of the following:

	March 31, 2014		December 31, 2013
Accrued wages	$	394,351	$	278,393
Accrued vacation expense		87,138		75,557
Total accrued compensation	$	481,489	$	353,950

Starting in March 2013, certain of the Company’s executives agreed to defer part, if not all, of their salaries until additional funding is obtained.

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Stockholders' Equity (Summary of Stock Options Outstanding) (Details) (USD $)	3 Months Ended
	Mar. 31, 2014
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items]
Exercise Price, stock options, lower limit (in Dollars per Share)	$ 0.34
Exercise Price, stock options, upper limit (in Dollars per Share)	$ 0.48
Number of Options Outstanding, exercise price range (in Shares)	6,184,703
Weighted Average Remaining Contractual Life (Years) (in Duration)	7 years 4 months 21 days
Number of Options Exercisable, exercise price range (in Shares)	4,201,370
$0.06 - $0.08 [Member]
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items]
Exercise Price, stock options, lower limit (in Dollars per Share)	$ 0.06
Exercise Price, stock options, upper limit (in Dollars per Share)	$ 0.08
Number of Options Outstanding, exercise price range (in Shares)	902,600
Weighted Average Remaining Contractual Life (Years) (in Duration)	5 years 1 month 17 days
Weighted Average Price Exercise, exercise price range, stock options outstanding (in Dollars per Share)	$ 0.08
Number of Options Exercisable, exercise price range (in Shares)	902,600
Weighted Average Price Exercise, exercise price range, options exercisable (in Dollars per Share)	$ 0.08
$0.15 - $0.19 [Member]
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items]
Exercise Price, stock options, lower limit (in Dollars per Share)	$ 0.15
Exercise Price, stock options, upper limit (in Dollars per Share)	$ 0.19
Number of Options Outstanding, exercise price range (in Shares)	2,072,840
Weighted Average Remaining Contractual Life (Years) (in Duration)	5 years 3 months 26 days
Weighted Average Price Exercise, exercise price range, stock options outstanding (in Dollars per Share)	$ 0.17
Number of Options Exercisable, exercise price range (in Shares)	2,072,840
Weighted Average Price Exercise, exercise price range, options exercisable (in Dollars per Share)	$ 0.17
Exercise Price $0.70 [Member]
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items]
Number of Options Outstanding, exercise price range (in Shares)	2,319,263
Weighted Average Remaining Contractual Life (Years) (in Duration)	9 years 11 months 12 days
Weighted Average Price Exercise, exercise price range, stock options outstanding (in Dollars per Share)	$ 0.70
Number of Options Exercisable, exercise price range (in Shares)	707,597
Weighted Average Price Exercise, exercise price range, options exercisable (in Dollars per Share)	$ 0.70
Exercise Price $1.00 [Member]
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items]
Number of Options Outstanding, exercise price range (in Shares)	890,000
Weighted Average Remaining Contractual Life (Years) (in Duration)	7 years 10 months 2 days
Weighted Average Price Exercise, exercise price range, stock options outstanding (in Dollars per Share)	$ 1.00
Number of Options Exercisable, exercise price range (in Shares)	518,333
Weighted Average Price Exercise, exercise price range, options exercisable (in Dollars per Share)	$ 1.00

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Stockholders' Equity (Summary of Outstanding Common Stock Options and Related Activity) (Details) (Stock Options [Member], USD $)	3 Months Ended	12 Months Ended
	Mar. 31, 2014	Dec. 31, 2013
Stock Options [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of Options Outstanding, begining balance (in Shares)	3,865,440
Number of Options, Granted (in Shares)	2,319,263
Number of Options, Exercised (in Shares)
Number of Options, Forfeited (in Shares)
Number of Options Outstanding, ending balance (in Shares)	6,184,703	3,865,440
Number of Options, Exercisable, ending balance (in Shares)	4,201,370
Weighted Average Exercise Price Per Share, Outstanding, begining balance (in Dollars per Share)	$ 0.34
Weighted Average Exercise Price Per Share, Granted (in Dollars per Share)	$ 0.70
Weighted Average Exercise Price Per Share, Outstanding, ending balance (in Dollars per Share)	$ 0.48	$ 0.34
Weighted Average Exercise Price Per Share, Exercisable, ending balance (in Dollars per Share)	$ 0.34
Weighted Average Remaining Life, options outstanding (Years) (in Duration)	7 years 4 months 21 days	6 years 11 months 23 days
Weighted Average Remaining Life, options granted (Years) (in Duration)		9 years 11 months 12 days
Weighted Average Remaining Life, options exercisable (Years) (in Duration)	6 years 3 months 7 days

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Stockholders' Equity (Stock-Based Compensation Award Valuation Assumptions) (Details)	3 Months Ended
	Mar. 31, 2014
Stockholders' Equity [Abstract]
Risk-free interest rate (in Percent)	2.07%
Expected stock price volatility (in Percent)	71.05%
Expected dividend yield (in Percent)	0.00%
Expected life of options (in Duration)	6 years 3 months 4 days

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Commitments and Contingencies (Narrative) (Details) (USD $)	3 Months Ended
	Mar. 31, 2014
Long Term Purchase Commitment [Line Items]
Common stock issued for services (in Shares)	35,000
Warrant issued, number of shares of common stock called by warrant (in Shares)	75,000
Warrant issued, common stock called for, strike price (in Dollars per Share)	$ 1.01
Warrant issued, life of common stock called (in Duration)	5 years
Additional warrants authorized for issuance, maximum number of shares of common stock (in Shares)	50,000
Business Consulting Services Agreement [Member]
Long Term Purchase Commitment [Line Items]
Common stock issued for services (in Shares)	25,000

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Accounts Payable

3 Months Ended

Mar. 31, 2014

Accounts Payable [Abstract]

Accounts Payable

3. Accounts Payable

On March 7, 2014, the Company settled through the issuance of common units indebtedness of $2,408,030, of which $2,304,030 was previously classified as accounts payable (see Note 2).

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Subsequent Events (Narrative) (Details) (2014 Financing Transactions [Member], USD $)	3 Months Ended
	Mar. 31, 2014
2014 Financing Transactions [Member]
Subsequent Event [Line Items]
Subsequent event (Date)	Apr. 14, 2014
Subsequent event, net proceeds	$ 1,522,500
Subsequent event, number of units issued (in Units)	1,522,500
Subsequent event, units issued, number of common stock included in each unit (in Shares)	1
Subsequent event, units issued, number of warrants included in each unit (in Shares)	1

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Condensed Consolidated Balance Sheets (Unaudited) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Current assets:
Cash	$ 284,407	$ 142,532
Receivables, net of allowance of $28,800 as of March 31, 2014 and December 31, 2013		5,556
Prepaid financing costs, net		63,333
Prepaid expenses and other	10,683	10,109
Total current assets	295,090	221,530
Property and equipment, net	31,296	27,999
Other assets	7,513	7,513
Total assets	333,899	257,042
Current liabilities:
Accounts payable	386,838	2,364,001
Accrued liabilities	106,192	81,156
Accrued compensation	481,489	353,950
Notes payable	400,000	500,000
Derivative liability	99,344
Total current liabilities	1,473,863	3,299,107
Commitments and contingencies
Stockholders' deficit:
Common stock, $0.0001 par value: 100,000,000 shares authorized; 27,869,863 and 24,936,833 shares outstanding as of March 31, 2014 and December 31, 2013, respectively	2,787	2,494
Additional paid-in capital	23,908,526	20,836,811
Accumulated deficit	(25,051,277)	(23,881,370)
Total stockholders' deficit	(1,139,964)	(3,042,065)
Total liabilities and stockholders' deficit	$ 333,899	$ 257,042

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Organization

3 Months Ended

Mar. 31, 2014

Organization [Abstract]

Organization

1. Organization

Q Therapeutics, Inc. (Q Therapeutics) conducts its operations through its wholly owned subsidiary, Q Therapeutic Products, Inc. (Q Products), and its wholly owned subsidiary, NeuroQ Research, Inc. (collectively, the Company). Q Therapeutics is a Salt Lake City, Utah-based biopharmaceutical company that is developing human cell-based therapies intended to treat degenerative diseases of the brain and spinal cord, the primary components of the central nervous system (CNS). Q Products was incorporated in the state of Delaware on March 28, 2002, and merged with Q Acquisition, Inc., a Delaware corporation and a wholly owned subsidiary of Grace 2, Inc., on October 13, 2011. Grace 2, Inc. was incorporated on October 27, 2005. On November 2, 2011, Grace 2 changed its name to Q Holdings, Inc., and on December 10, 2012, it changed its name to Q Therapeutics, Inc.

These potential therapies are based on our technology developed by Q Products’ co-founder Mahendra Rao, M.D., Ph.D., a leader in glial stem cell biology, during his tenure at the University of Utah and as Head of the Stem Cell Section in the Laboratory of Neuroscience at the National Institutes of Health (NIH). Dr. Rao was one of the first scientists to identify and seek patent coverage on stem cells and their progeny cells found in the CNS. After licensing Dr. Rao’s technology from the University of Utah and NIH, Q Products commenced operations in the spring of 2004 to develop cell-based therapeutic products that can be sold as “off-the-shelf” pharmaceuticals.

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Accrued Compensation (Schedule of Accrued Compensation) (Details) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Accrued Compensation [Abstract]
Accrued wages	$ 394,351	$ 278,393
Accrued vacation	87,138	75,557
Total accrued compensation	$ 481,489	$ 353,950

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Derivative Liability (Narrative) (Details) (USD $)	3 Months Ended
	Mar. 31, 2014
Derivative Liability [Abstract]
Common units issued, consisting of one share of common stock and one warrant to purchase one share of common stock, in connection with the first tranche of the 2014 Financing Transactions (in Shares)	2,898,030
Down round provision, stock price floor applicable to future offering of units, below which down round protection is triggered for first tranche investors (in Dollars per Share)	$ 1

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Significant Accounting Policies

3 Months Ended

Mar. 31, 2014

Significant Accounting Policies [Abstract]

Significant Accounting Policies

2. Significant Accounting Policies

The following significant accounting policies are followed by the Company in preparing its condensed consolidated financial statements:

Basis of Presentation and Consolidation

These unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in the Company’s Form 10-K filed with the Securities and Exchange Commission (SEC) on April 15, 2014. The results of operations for the three-month period ended March 31, 2014 are not necessarily indicative of the results to be expected for the full year ending December 31, 2014. In the opinion of management, all adjustments that are necessary for a fair presentation of the financial information for the interim periods reported have been made. All such adjustments are of a normal recurring nature.

The accompanying unaudited condensed consolidated financial statements have been prepared by management in accordance with U.S. generally accepted accounting principles (US GAAP), and include all assets and liabilities of Q Therapeutics and its wholly owned subsidiary, Q Products. All material intercompany transactions and balances have been eliminated.

Development Stage and Liquidity

For the period from March 28, 2002 (date of inception) through March 31, 2014, the Company has not generated significant revenues and has been developing its products. Therefore, the Company is considered to be in the development stage in accordance with the provisions of Accounting Standards Codification (ASC) Topic 915, Development Stage Entities. Cumulative amounts are presented for the period from March 28, 2002 (date of inception) through March 31, 2014. Historically, the Company has been dependent on government grants and debt and equity raised from individual investors to sustain its operations. The Company’s continued operations will depend on its ability to raise funds through various sources such as government grants and equity and debt financing. The Company expects to continue to fund operations through similar sources of capital previously described. There can be no assurance that such capital will be available on favorable terms or at all. If it is unable to raise additional capital, the Company will likely be forced to curtail desired development activities, which will delay the development of its product candidates. The Company’s products have not been approved by the U.S. Food and Drug Administration (FDA) for commercial sale; therefore, the Company has not generated revenues from commercial therapeutic product sales. The Company has incurred losses and used cash for operating activities since inception. As of March 31, 2014, the Company had an accumulated deficit of $25,051,277.

2014 Financing Transactions

Between March 7 and April 14, 2014, the Company issued an aggregate of 4,420,530 units, each containing one share of the Company’s common stock and one warrant to purchase one share of the Company’s common stock, resulting from two tranches of financing in which the Company received cash consideration of $2,012,500 and settled indebtedness of $2,408,030 (2014 Financing Transactions). The warrants were issued at an initial exercise price of $1.00 per share, are immediately exercisable, and expire in no more than four years. Both the shares of common stock and the warrants have a down-round provision provided to the stockholders in the event that the Company does another offering of units, which consists of one share of common stock and one warrant to purchase one share of common stock, at a price below $1.00 per share. The down-round provision expires upon the earlier of the effectiveness of a registration statement with the SEC or one year after the issuance date.

Use of Estimates

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosures of contingent assets and liabilities as of the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Accordingly, actual results could differ from those estimates. Key estimates include allowances for doubtful accounts receivable, useful lives for property and equipment, valuation allowances for net deferred income tax assets, and valuations for stock-based compensation awards. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances.

Revenue Recognition and Grants Receivable

The Company periodically applies for research grants, including as a sub-recipient to grants funded by government agencies through research universities. Grant revenues are recognized as associated expenses are incurred and are billed in conjunction with the terms of the grants. The Company records its grants receivable in accordance with the provisions of the grant agreements. The Company’s grants receivable are considered past due when payment has not been received within 30 days of the invoice date, although certain institutions customarily do not pay within these terms. The amounts of the specific reserves are estimated by management based on various assumptions including the age of the individual receivable, as well as changes in payment schedules and histories. Receivable balances are charged off against the allowance for doubtful accounts when management determines the potential for recovery is remote. Recoveries of receivables previously charged off are recorded when payment is received.

In December 2012, the Company was notified of a sub-award as part of grant funding awarded to The Johns Hopkins University (JHU) from the National Institute of Neurological Disorders and Stroke (NINDS) of the National Institutes of Health. The sub-award for the 2012-2013 grant plan year is $631,383. In May 2013, JHU applied for, and was granted a six-month extension for completing the analysis and remitting data and expenses. As of March 31, 2014, the 2012-2013 grant plan year was closed. The Company is awaiting the notification of the award for year 4. As of March 31, 2014, there are no amounts outstanding related to this sub-award.

Stock-Based Compensation

The Company calculates the estimated fair value of its stock options and warrants on the grant date using the Black-Scholes option-pricing model. The Company recognizes stock-based compensation expense as services are provided, which is generally over the vesting period of the individual equity instruments. Expense related to stock options issued in lieu of cash to non-employees for services performed are measured at the fair value of the options on the date they are earned.

The volatility assumption used in the Black-Scholes option-pricing model is based on the volatility of publicly traded companies in the same industry segment as the Company. The expected lives of the options and warrants granted represent the periods of time that the options granted are expected to be outstanding. The risk free rates for periods within the contractual lives of the options and warrants are based on the U.S. treasury securities constant maturity rate that corresponds to the expected terms in effect at the time of grant. Stock-based compensation is included in general and administrative expense in the statements of operations.

Net Loss Per Common Share

Basic net income or loss per common share (Basic EPS) is computed by dividing net income or loss by the weighted average number of common shares outstanding. Diluted net income or loss per common share (Diluted EPS) is computed by dividing net income or loss by the sum of the weighted average number of common shares outstanding and the dilutive potential common share equivalents then outstanding. Potential dilutive common share equivalents consist of shares issuable upon the exercise of outstanding stock options and warrants to acquire common stock.

Due to the fact that for all periods presented the Company has incurred net losses, potential dilutive common share equivalents as of March 31, 2014 and 2013, totaling 21,437,251 and 15,907,458, respectively, are not included in the calculation of Diluted EPS because they are anti-dilutive. Therefore, basic net loss per common share is the same as diluted net loss per common share for the three months ended March 31, 2014 and 2013.

Recent Accounting Pronouncements

The Company has reviewed accounting pronouncements that become effective subsequent to March 31, 2014 and does not believe the future adoption of those pronouncements will have a material impact on the Company’s financial position, results of operations or liquidity.

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Condensed Consolidated Balance Sheets (Parenthetical) (Unaudited) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Condensed Consolidated Balance Sheets [Abstract]
Receivables, allowance for doubtful accounts	$ 28,800	$ 28,800
Common stock, par value (in Dollars per Share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in Shares)	100,000,000	100,000,000
Common stock, shares outstanding (in Shares)	27,869,863	24,936,833

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Derivative Liability (Tables)

3 Months Ended

Mar. 31, 2014

Derivative Liability [Abstract]

Schedule of Derivative Liabilities

Assets and liabilities measured at fair value on a recurring basis as of March 31, 2014 are summarized as follows:

	Fair Value as of March 31, 2014
	Level 1		Level 2		Level 3		Total
Derivative liability	$	—	$	—	$	99,344	$	99,344

Schedule of Derivative liability fair value unobservable input reconciliation

The following table presents the fair value reconciliation of Level 3 liabilities measured at fair value on a recurring basis during the three months ended March 31, 2014.

	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	Derivative
Beginning balance, December 31, 2013	$	—
Issuances:
Derivatives liability related to down-round provision of common stock units		99,344
Ending balance, March 31, 2014	$	99,344

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Document and Entity Information	3 Months Ended
	Mar. 31, 2014	May 15, 2014
Document and Entity Information [Abstract]
Entity Registrant Name	Q Therapeutics, Inc.
Entity Central Index Key	0001366541
Document Type	10-Q
Document Period End Date	Mar. 31, 2014
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filer	No
Entity Current Reporting Status	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		29,417,363
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2014

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Stockholders' Equity (Tables)

3 Months Ended

Mar. 31, 2014

Stockholders' Equity [Abstract]

Summary of Outstanding Common Stock Options and Related Activity

The following summarizes the outstanding common stock options and related activity for the three months ended March 31, 2014:

	Number of Options		Weighted Average Exercise Price Per Share		Weighted Average Remaining Life (Years)
Outstanding as of December 31, 2013		3,865,440	$	0.34		6.98
Granted		2,319,263		0.70		9.95
Exercised		—		—
Forfeited		—		—
Outstanding as of March 31, 2014		6,184,703		0.48		7.39
Exercisable as of March 31, 2014		4,201,370		0.34		6.27

Summary of Stock Options Outstanding

As of March 31, 2014, options to purchase 1,668,266 shares of common stock under the Plan were available for future grant. The following summarizes information about stock options outstanding as of March 31, 2014:

Exercise Price	Number of Options Outstanding		Weighted Average Remaining Contractual Life (Years)		Weighted Average Exercise Price		Number of Options Exercisable		Weighted Average Exercise Price
$ 0.06 - $0.08		902,600		5.13	$	0.08		902,600	$	0.08
$ 0.15 - $0.19		2,072,840		5.32		0.17		2,072,840		0.17
$0.70		2,319,263		9.95		0.70		707,597		0.70
$1.00		890,000		7.84		1.00		518,333		1.00
		6,184,703		7.39		0.48		4,201,370		0.34

Schedule of Stock Option Awards, Valuation Assumptions

The fair value of each stock-based compensation award granted during the three months ended March 31, 2014 was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions:

Risk-free interest rate	2.07%
Expected stock price volatility	71.05%
Expected dividend yield	0%
Expected life of options	6.26 years

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Condensed Consolidated Statements of Operations (Unaudited) (USD $)	3 Months Ended		144 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2014
Condensed Consolidated Statements of Operations [Abstract]
Grant revenues		$ 5,501	$ 1,104,434
License fees and other revenues			294,900
Total operating revenues		5,501	1,399,334
Cost of revenues			4,800
Gross profit		5,501	1,394,534
Operating expenses:
Research and development	484,144	131,109	13,284,569
General and administrative	583,862	374,719	11,087,809
Total operating expenses	1,068,006	505,828	24,372,378
Operating loss	(1,068,006)	(500,327)	(22,977,844)
Other income (expense):
Interest income			187,616
Interest expense	(102,417)	(325)	(2,415,942)
Other income, net	516	1,373	154,893
Total other income (expense), net	(101,901)	1,048	(2,073,433)
Loss before provision (benefit) for income taxes	(1,169,907)	(499,279)	(25,051,277)
Provision (benefit) for income taxes
Net loss	$ (1,169,907)	$ (499,279)	$ (25,051,277)
Weighted average number of common shares outstanding - basic and diluted (in Shares)	25,017,018	24,778,221
Net loss per common share - basic and diluted (in Dollars per Share)	$ 0.05	$ 0.02

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Stockholders' Equity

3 Months Ended

Mar. 31, 2014

Stockholders' Equity [Abstract]

Stockholders' Equity

7. Stockholders’ Equity

Common Stock

On March 7, 2014, the Company issued 2,898,030 units, each consisting of one share of common stock and one warrant to purchase one share of common stock, to individual investors as part of the 2014 Financing Transactions (see Note 2). The units have a down-round provision to the stockholders in the event that the Company sells units similar to those in the previous offering at a price below $1.00 per share. The down-round provision expires upon the earlier of the effectiveness of a registration statement with the SEC or one year after the issuance date.

Additionally during the quarter ended March 31, 2014, the Company issued an aggregate of 35,000 shares of its common stock in lieu of cash for services and for technology acquired from a collaborative partner. As of March 31, 2014, 27,869,863 shares of common stock are outstanding.

Stock Options

The following summarizes the outstanding common stock options and related activity for the three months ended March 31, 2014:

	Number of Options		Weighted Average Exercise Price Per Share		Weighted Average Remaining Life (Years)
Outstanding as of December 31, 2013		3,865,440	$	0.34		6.98
Granted		2,319,263		0.70		9.95
Exercised		—		—
Forfeited		—		—
Outstanding as of March 31, 2014		6,184,703		0.48		7.39
Exercisable as of March 31, 2014		4,201,370		0.34		6.27

As of March 31, 2014, options to purchase 1,668,266 shares of common stock under the Plan were available for future grant. The following summarizes information about stock options outstanding as of March 31, 2014:

Exercise Price	Number of Options Outstanding		Weighted Average Remaining Contractual Life (Years)		Weighted Average Exercise Price		Number of Options Exercisable		Weighted Average Exercise Price
$ 0.06 - $0.08		902,600		5.13	$	0.08		902,600	$	0.08
$ 0.15 - $0.19		2,072,840		5.32		0.17		2,072,840		0.17
$0.70		2,319,263		9.95		0.70		707,597		0.70
$1.00		890,000		7.84		1.00		518,333		1.00
		6,184,703		7.39		0.48		4,201,370		0.34

As of March 31, 2014, the aggregate intrinsic value of outstanding and exercisable stock options was $3,245,404 and $2,761,905, respectively.

Stock-based compensation for the three months ended March 31, 2014 and 2013 was $248,822 and $25,438, respectively. As of March 31, 2014, the Company had $696,499 of unrecognized stock-based compensation expense related to non-vested awards that is expected to be recognized over a weighted-average period of 2.89 years.

The fair value of each stock-based compensation award granted during the three months ended March 31, 2014 was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions:

Risk-free interest rate	2.07%
Expected stock price volatility	71.05%
Expected dividend yield	0%
Expected life of options	6.26 years

Warrants

In January 2014, the Company issued a warrant to purchase 50,000 shares of common stock to a business consulting firm (see Note 8).

On March 7, 2014, the Company issued warrants to purchase 2,898,030 shares of common stock as a result of the first tranche of the 2014 Financing Transactions (see Note 2). The warrants have an initial exercise price of $1.00 per share, have up to a four-year life, are exercisable immediately, and have down-round protection in the event that the Company subsequently sells similar units at a price less than $1.00 per share (see Note 6).

As of March 31, 2014, 15,252,548 warrants to purchase common stock had been issued and were outstanding with exercise prices ranging from $.046 to $2.75 per share and terms ranging from two to seven years. The weighted average warrant exercise price is $1.33 and the weighted average remaining life is 4.16 years.

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Derivative Liability

3 Months Ended

Mar. 31, 2014

Derivative Liability [Abstract]

Derivative Liability

6. Derivative Liability

In connection with the first tranche of the 2014 Financing Transactions, the Company issued 2,898,030 common units, each unit consisting of one share of common stock and one warrant to purchase one share of common stock (see Note 2), and recorded a derivative liability related to down-round protection provided to the stockholders in the event that the Company does another offering of units, similar to those issued in the 2014 Financing Transactions, at a price below $1.00 per share. The down-round provision expires upon the earlier of the effectiveness of a registration statement with the SEC or one year after the issuance date. With the assistance of a third-party valuation specialist, the Company valued the derivative liability pursuant to the accounting guidance of ASC 820-10, Fair Value Measurements.

Fair values for warrants and common stock are determined using the Monte-Carlo Simulation Model valuation technique. The Monte-Carlo Simulation Model valuation model provides for dynamic assumptions regarding volatility and risk-free interest rates within the total period to expected conversion. In addition, management assessed the probabilities of future financing assumptions.

As defined in FASB ASC 820-10, fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In order to increase consistency and comparability in fair value measurements, FASB ASC 820-10 establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below:

Level 1	Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities.
Level 2	Other inputs that are observable directly or indirectly, such as quoted prices for similar assets and liabilities or market corroborated inputs.
Level 3	Unobservable inputs that are used when little or no market data is available, which require the Company to develop its own assumptions about how market participants would value the assets or liabilities.

Determining which category an asset or liability falls within the hierarchy requires significant judgment. The Company evaluates its hierarchy disclosure each quarter. Assets and liabilities measured at fair value on a recurring basis as of March 31, 2014 are summarized as follows:

	Fair Value as of March 31, 2014
	Level 1		Level 2		Level 3		Total
Derivative liability	$	—	$	—	$	99,344	$	99,344

The following table presents the fair value reconciliation of Level 3 liabilities measured at fair value on a recurring basis during the three months ended March 31, 2014.

	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	Derivative
Beginning balance, December 31, 2013	$	—
Issuances:
Derivatives liability related to down-round provision of common stock units		99,344
Ending balance, March 31, 2014	$	99,344

Given the nature of the derivative liability, the carrying amount of $99,344 as of March 31, 2014, was derived from Level 3 inputs and represent management’s best estimate of fair value.

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Notes Payable (Narrative) (Details) (USD $)	2 Months Ended	3 Months Ended	8 Months Ended
	Sep. 30, 2013	Mar. 31, 2014	Mar. 31, 2014	Dec. 31, 2013
Notes Payable [Abstract]
Note payable, cash proceeds	$ 250,000
Note payable, percentage of face value at issuance (in Percent)		50.00%	50.00%
Note payable, annual interest rate (in Percent)		8.00%	8.00%
Note payable, maturity date (in Date)		Feb. 05, 2014
Notes payable		400,000	400,000	500,000
Note payable, interest recorded			273,733
Note payable, prepaid financing costs to be amortized over remaining term				63,333
Note payable, nominal effective interest rate (in Percent)		156.00%	156.00%
Note payable, including interest, converted to equity [Member]
Debt Conversion [Line Items]
Debt conversion, converted instrument, issuance date (Date)		Mar. 07, 2014
Debt conversion, original debt amount		$ 104,000

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Organization (Narrative) (Details)	3 Months Ended
	Mar. 31, 2014
Q Therapeutics, Inc. [Member]
Entity Information [Line Items]
Date of incorporation (Date)	Oct. 27, 2005
Q Therapeutic Products, Inc. [Member]
Entity Information [Line Items]
Date of incorporation (Date)	Mar. 28, 2002

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Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2014

Significant Accounting Policies [Abstract]

Basis of Presentation, Policy

Basis of Presentation and Consolidation

These unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in the Company’s Form 10-K filed with the Securities and Exchange Commission (SEC) on April 15, 2014. The results of operations for the three-month period ended March 31, 2014 are not necessarily indicative of the results to be expected for the full year ending December 31, 2014. In the opinion of management, all adjustments that are necessary for a fair presentation of the financial information for the interim periods reported have been made. All such adjustments are of a normal recurring nature.

The accompanying unaudited condensed consolidated financial statements have been prepared by management in accordance with U.S. generally accepted accounting principles (US GAAP), and include all assets and liabilities of Q Therapeutics and its wholly owned subsidiary, Q Products. All material intercompany transactions and balances have been eliminated.

Development Stage and Liquidity, Policy

Development Stage and Liquidity

For the period from March 28, 2002 (date of inception) through March 31, 2014, the Company has not generated significant revenues and has been developing its products. Therefore, the Company is considered to be in the development stage in accordance with the provisions of Accounting Standards Codification (ASC) Topic 915, Development Stage Entities. Cumulative amounts are presented for the period from March 28, 2002 (date of inception) through March 31, 2014. Historically, the Company has been dependent on government grants and debt and equity raised from individual investors to sustain its operations. The Company’s continued operations will depend on its ability to raise funds through various sources such as government grants and equity and debt financing. The Company expects to continue to fund operations through similar sources of capital previously described. There can be no assurance that such capital will be available on favorable terms or at all. If it is unable to raise additional capital, the Company will likely be forced to curtail desired development activities, which will delay the development of its product candidates. The Company’s products have not been approved by the U.S. Food and Drug Administration (FDA) for commercial sale; therefore, the Company has not generated revenues from commercial therapeutic product sales. The Company has incurred losses and used cash for operating activities since inception. As of March 31, 2014, the Company had an accumulated deficit of $25,051,277.

Use of Estimates, Policy

Use of Estimates

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosures of contingent assets and liabilities as of the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Accordingly, actual results could differ from those estimates. Key estimates include allowances for doubtful accounts receivable, useful lives for property and equipment, valuation allowances for net deferred income tax assets, and valuations for stock-based compensation awards. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances.

Revenue Recognition and Grants Receivable, Policy

Revenue Recognition and Grants Receivable

The Company periodically applies for research grants, including as a sub-recipient to grants funded by government agencies through research universities. Grant revenues are recognized as associated expenses are incurred and are billed in conjunction with the terms of the grants. The Company records its grants receivable in accordance with the provisions of the grant agreements. The Company’s grants receivable are considered past due when payment has not been received within 30 days of the invoice date, although certain institutions customarily do not pay within these terms. The amounts of the specific reserves are estimated by management based on various assumptions including the age of the individual receivable, as well as changes in payment schedules and histories. Receivable balances are charged off against the allowance for doubtful accounts when management determines the potential for recovery is remote. Recoveries of receivables previously charged off are recorded when payment is received.

In December 2012, the Company was notified of a sub-award as part of grant funding awarded to The Johns Hopkins University (JHU) from the National Institute of Neurological Disorders and Stroke (NINDS) of the National Institutes of Health. The sub-award for the 2012-2013 grant plan year is $631,383. In May 2013, JHU applied for, and was granted a six-month extension for completing the analysis and remitting data and expenses. As of March 31, 2014, the 2012-2013 grant plan year was closed. The Company is awaiting the notification of the award for year 4. As of March 31, 2014, there are no amounts outstanding related to this sub-award.

Stock-Based Compensation, Policy

Stock-Based Compensation

The Company calculates the estimated fair value of its stock options and warrants on the grant date using the Black-Scholes option-pricing model. The Company recognizes stock-based compensation expense as services are provided, which is generally over the vesting period of the individual equity instruments. Expense related to stock options issued in lieu of cash to non-employees for services performed are measured at the fair value of the options on the date they are earned.

The volatility assumption used in the Black-Scholes option-pricing model is based on the volatility of publicly traded companies in the same industry segment as the Company. The expected lives of the options and warrants granted represent the periods of time that the options granted are expected to be outstanding. The risk free rates for periods within the contractual lives of the options and warrants are based on the U.S. treasury securities constant maturity rate that corresponds to the expected terms in effect at the time of grant. Stock-based compensation is included in general and administrative expense in the statements of operations.

Net Loss Per Common Share, Policy

Net Loss Per Common Share

Basic net income or loss per common share (Basic EPS) is computed by dividing net income or loss by the weighted average number of common shares outstanding. Diluted net income or loss per common share (Diluted EPS) is computed by dividing net income or loss by the sum of the weighted average number of common shares outstanding and the dilutive potential common share equivalents then outstanding. Potential dilutive common share equivalents consist of shares issuable upon the exercise of outstanding stock options and warrants to acquire common stock.

Due to the fact that for all periods presented the Company has incurred net losses, potential dilutive common share equivalents as of March 31, 2014 and 2013, totaling 21,437,251 and 15,907,458, respectively, are not included in the calculation of Diluted EPS because they are anti-dilutive. Therefore, basic net loss per common share is the same as diluted net loss per common share for the three months ended March 31, 2014 and 2013.

Recent Accounting Pronouncements, Policy

Recent Accounting Pronouncements

The Company has reviewed accounting pronouncements that become effective subsequent to March 31, 2014 and does not believe the future adoption of those pronouncements will have a material impact on the Company’s financial position, results of operations or liquidity.

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2014

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

8. Commitments and Contingencies

Advisory Agreements

In July 2013, the Company entered into a business consulting services agreement effective through December 31, 2015. Under the agreement, the Company issued an initial payment of a warrant to purchase 75,000 shares of common stock at an exercise price of $1.01 per share, with a five-year life and a cashless exercise option. In January 2014, the Company issued an additional warrant to purchase 50,000 shares of common stock with similar terms to the initial issuance. Under the agreement, the business consulting firm is entitled to receive additional warrants for up to 50,000 shares of common stock with similar terms.

In May 2014, the Company and its investor relations firm amended their service agreement such that the consulting firm will receive 25,000 shares of the Company’s common stock each quarter in lieu of cash for services rendered. As of March 31, 2014, 25,000 shares of common stock have been issued under this amendment.

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Subsequent Events

3 Months Ended

Mar. 31, 2014

Subsequent Events [Abstract]

Subsequent Events

9. Subsequent Events

On April 14, 2014, the Company received $1,522,500 from the second tranche of the 2014 Financing Transactions. The Company issued 1,522,500 units consisting of one share of common stock and one warrant to purchase common stock (see Note 2). The terms of the warrants are similar to those issued in the first tranche of the 2014 Financing Transactions (see Note 7).

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Accrued Compensation (Tables)

3 Months Ended

Mar. 31, 2014

Accrued Compensation [Abstract]

Schedule of Accrued Compensation

Accrued compensation consists of the following:

	March 31, 2014		December 31, 2013
Accrued wages	$	394,351	$	278,393
Accrued vacation expense		87,138		75,557
Total accrued compensation	$	481,489	$	353,950

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Accounts Payable (Narrrative) (Details) (USD $)	3 Months Ended
	Mar. 31, 2014
Accounts Payable [Abstract]
Indebtedness settled through common units issuance	$ 2,408,030
Portion of settled indebtedness previously classified as accounts payable	$ 2,304,030

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Derivative Liability (Schedule of Level 3 Liabilities, Fair Value Reconciliation) (Details) (Fair Value Inputs Level 3 [Member], USD $)	3 Months Ended
	Mar. 31, 2014	Dec. 31, 2013
Fair Value Inputs Level 3 [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Derivative liability related to down round provision of common stock units	$ 99,344
Issuances: derivative liability related to down round provision of common stock units	$ 99,344

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Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $)	3 Months Ended	144 Months Ended
	Mar. 31, 2014	Mar. 31, 2014
Cash flows from operating activities:
Net loss	$ (1,169,907)	$ (25,051,277)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	2,318	405,812
Original debt discount	63,333	513,333
Accretion of debt costs and beneficial conversion feature		1,423,930
Stock-based compensation	248,822	782,376
Debt issued for services		90,000
Common stock issued for services	24,500	356,250
Preferred stock issued for services		44,750
Warrants issued for services		78,370
Provision for losses on receivables		(43,677)
Decrease (increase) in:
Receivables	5,556	43,677
Prepaid expenses and other assets	(574)	(18,196)
Increase (decrease) in:
Accounts payable and accrued liabilities	355,903	3,200,179
Accrued compensation	127,539	481,489
Net cash used in operating activities	(342,510)	(17,692,984)
Cash flows from investing activities:
Purchase of property and equipment	(5,615)	(436,888)
Cash flows from financing activities:
Proceeds from issuance of notes payable		5,507,562
Payments on short-term note payable		(90,000)
Issuance of preferred stock for cash		8,671,747
Issuance of common stock for cash	490,000	4,311,137
Proceeds from exercise of common stock options		11,600
Proceeds from exercise of preferred stock warrants		2,233
Net cash provided by financing activities	490,000	18,414,279
Net increase (decrease) in cash	141,875	284,407
Cash as of beginning of the period	142,532
Cash as of end of the period	284,407	284,407
Supplemental disclosure of cash flow information:
Cash paid for interest	214	8,894
Supplemental disclosure of noncash investing and financing activities for the period from March 28, 2002 (date of inception) to March 31, 2014:
Common shares issued in exchange for technology (in Shares)		219,658
Common shares issued in exhange for technology, value		220
Debt discount related to preferred stock warrants issued with debt and the beneficial conversion feature		1,237,263
Common stock retired (in Shares)		200,000
Common stock retired, net impact on equity		19
Conversion Of Stock [Line Items]
Notes payable assumed		500,000
Series A1 Preferred stock converted to common stock [Member]
Conversion Of Stock [Line Items]
Conversion of stock, shares converted (in Shares)		250,000
Series A2 Preferred stock converted to common stock [Member]
Conversion Of Stock [Line Items]
Conversion of stock, shares converted (in Shares)		2,022,190
Series B Preferred stock converted to common stock [Member]
Conversion Of Stock [Line Items]
Conversion of stock, shares converted (in Shares)		4,102,654
Common stock issued for preferred stock [Member]
Conversion Of Stock [Line Items]
Conversion of stock, shares issued (in Shares)		13,791,231
Notes payable converted to Series A2 preferred stock [Member]
Debt Conversion [Line Items]
Debt conversion, original debt amount		1,050,000
Accrued interest converted to Series A2 preferred stock [Member]
Debt Conversion [Line Items]
Debt conversion, original debt amount		29,691
Series A2 preferred stock issued for notes payable and accrued interest [Member]
Debt Conversion [Line Items]
Conversion of debt, shares issued (in Shares)		482,008
Notes payable converted to Series B preferred stock [Member]
Debt Conversion [Line Items]
Debt conversion, original debt amount		3,740,000
Accrued interest converted to Series B preferred stock [Member]
Debt Conversion [Line Items]
Debt conversion, original debt amount		370,346
Series B preferred stock issued for notes payable and accrued interest [Member]
Debt Conversion [Line Items]
Conversion of debt, shares issued (in Shares)		1,787,104
Bridge notes payable converted to common stock [Member]
Debt Conversion [Line Items]
Debt conversion, original debt amount		900,000
Accrued interest converted to common stock [Member]
Debt Conversion [Line Items]
Debt conversion, original debt amount		16,644
Common stock issued for bridge notes payable and accrued interest [Member]
Debt Conversion [Line Items]
Conversion of debt, shares issued (in Shares)		916,644
Accounts payable converted to common stock [Member]
Debt Conversion [Line Items]
Debt conversion, original debt amount		2,304,030
Notes payable converted to common stock [Member]
Debt Conversion [Line Items]
Debt conversion, original debt amount		$ 104,000
Accounts payable and notes payable converted to common stock [Member]
Debt Conversion [Line Items]
Conversion of debt, shares issued (in Shares)		2,408,030

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Notes Payable

3 Months Ended

Mar. 31, 2014

Notes Payable [Abstract]

Notes Payable

5. Notes Payable

Between August 12 and September 30, 2013, the Company received $250,000 in cash proceeds resulting from a bridge financing by certain note holders, some of which were also considered affiliates, as evidenced by promissory notes. The notes were issued at 50% of face value, bore interest at the rate of 8% per annum, and matured beginning February 5, 2014.

In February 2014, the largest note holder agreed to extend the maturity date for its $400,000 note for an additional 180 days, in exchange for certain call right language being removed from warrants the note holder had acquired in 2011. On March 7, 2014, the remaining note holder converted its note totaling $104,000, including interest, into units consisting of one share of common stock and one warrant to purchase a share of common stock as part of the 2014 Financing Transactions (see Note 2).

To date, the Company has recorded interest relating to the notes of $273,733, of which $250,000 pertained to the amortization of the debt discount. As of March 31, 2014, the debt discount has been fully amortized. Notes payable as of March 31, 2014 were $400,000.

The effective interest rate related to this financing is approximately 156%.

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Stockholders' Equity (Narrative) (Details) (USD $)	3 Months Ended		144 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2014	Mar. 07, 2014	Dec. 31, 2013
Common Stock
Common stock, shares issued (in Shares)				2,898,030
Price per share of common stock offered, below which, down-round provision will take effect (in Dollars per Share)	$ 1.00
Period of expiration of the down-round provision if shorter than the effectiveness of a registration statement with the SEC (in Duration)	1 year
Stock issued in lieu of cash for services (in Shares)	35,000
Common stock, shares outstanding (in Shares)	27,869,863		27,869,863		24,936,833
Stock Options
Common shares available for future grant (in Shares)	1,668,266		1,668,266
Outstanding stock options, aggregate intrinsic value	$ 3,245,404		$ 3,245,404
Exercisable stock options, aggregate intrinsic value	2,761,905		2,761,905
Stock-based compensation	248,822	25,438	782,376
Unrecognized stock-based compensation expense related to non-vested awards	$ 696,499		$ 696,499
Unrecognized stock-based compensation expense related to non-vested awards, weighted-average period of recognition (in Duration)	2 years 10 months 21 days
Warrants
Common stock issuable on excercise of warrants (in Shares)				2,898,030
Warrant issued, number of shares of common stock called by warrant (in Shares)	75,000
Warrant issued, common stock called for, strike price (in Dollars per Share)	$ 1.01
Warrant issued, life of common stock called (in Duration)	5 years

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Significant Accounting Policies (Narrative) (Details) (USD $)	1 Months Ended	3 Months Ended
	Apr. 14, 2014	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013
Significant Accounting Policies [Abstract]
Deficit accumulated during the development stage		$ 25,051,277		$ 23,881,370
Aggregate equity units issued of one share of common stock and one warrant to purchase one share of common stock (in Shares)	4,420,530
Proceeds for issuance of common stock units	2,012,500
Indebtedness settled	2,408,030
Period of no payment, grant receivable considered as past due (in Duration)		30 days
Grant plan, period of extension granted to JHU for completing analysis and remitting data and expenses (in Duration)		6 months
Sub-award received to help fund manufacturing and pre-clinical safety studies for Q-Cells for 2012-2013 grant plan year		631,383
Grants receivable, sub-award		$ 0
Anti dilutive losses (in Shares)		21,437,251	15,907,458