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 0-6533

ALSERES PHARMACEUTICALS, INC.

(Exact Name of Registrant as Specified in Its Charter)

Delaware	87-0277826
(State or Other Jurisdiction of Incorporation or Organization)	(IRS Employer Identification No.)
275 Grove Street suite 2-400, Auburndale, Massachusetts	02466
(Address of Principal Executive Offices)	(Zip Code)

(508) 497-2360

(Registrant’s Telephone Number, Including Area Code)

None

(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” 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 April 30, 2014, there were 30,635,720 shares of the registrant’s Common Stock issued and outstanding.

ALSERES PHARMACEUTICALS, INC.

FORM 10-Q

TABLE OF CONTENTS

	Page
Part I FINANCIAL INFORMATION
Item 1 Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets as of March 31, 2014 and December 31, 2013		3
Condensed Consolidated Statements of Comprehensive Loss for the three months ended March 31, 2014 and 2013,		4
Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2014 and 2013		5
Notes to Condensed Consolidated Financial Statements		6
Item 2 Management’s Discussion and Analysis of Financial Condition and Results of Operations		12
Item 3 Quantitative and Qualitative Disclosures About Market Risk		15
Item 4 Controls and Procedures		15
Part II OTHER INFORMATION		15
Item 6 Exhibits		16
SIGNATURES		17
EX-31.1
EX-31.2
EX-32.1
EX-32.2
EX-101 INSTANCE DOCUMENT
EX-101 SCHEMA DOCUMENT
EX-101 CALCULATION LINKBASE DOCUMENT
EX-101 LABELS LINKBASE DOCUMENT
EX-101 PRESENTATION LINKBASE DOCUMENT
EX-101 DEFINITION LINKBASE DOCUMENT

In this report, “we”, “us”, and “our” refer to Alseres Pharmaceuticals, Inc. The following are trademarks of ours that are mentioned in this Quarterly Report on Form 10-Q: Alseres™ and Altropane ^® . All other trade names, trademarks or service marks appearing in this Quarterly Report on Form 10-Q are the property of their respective owners and are not the property of Alseres Pharmaceuticals, Inc. or any of our subsidiaries.

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Part I — FINANCIAL INFORMATION

Item 1 — Financial Statements

Alseres Pharmaceuticals, Inc.

Consolidated Balance Sheets

(unaudited)

	(Unaudited) March 31, 2014			December 31, 2013
ASSETS
Current assets:
Cash and cash equivalents	$	93,508		$	113,958
Short-term investments		175,660			196,650
Restricted marketable securities		9,250			10,350
Prepaid expenses and other current assets		26,109			3,686
Total current assets		304,527			324,644
Deferred charges		59,905			60,827
Total assets	$	364,432		$	385,471
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accounts payable and accrued expenses	$	1,041,117		$	1,055,738
Accrued interest on notes payable		63,043			5,630
Deferred revenue		73,731			73,731
Other current liabilities		12,121			13,221
Advances from related party		500,000			500,000
Total current liabilities		1,690,012			1,648,320
Note payable		8,128,662			7,819,960
Deferred revenue, net of current portion		1,124,387			1,142,816
Other long-term liabilities		43,750			43,750
Total liabilities		10,986,811			10,654,846
Commitments and contingencies
Series F convertible redeemable preferred stock, $.01 par value; 200,000 shares designated; 12,000 shares issued and outstanding at March 31, 2014 and December 31, 2013, (liquidation preference of $300,000 at March 31, 2014)		395,737			390,443
Stockholders’ deficit:
Common stock, $.01 par value; 80,000,000 shares authorized at March 31, 2014 and December 31, 2013; 30,635,720 issued and outstanding at March 31, 2014 and December 31, 2013		306,357			306,357
Additional paid-in capital		188,656,954			188,662,248
Accumulated other comprehensive income (loss)		(14,340	)		6,650
Deficit accumulated		(199,967,087	)		(199,635,073	)
Total stockholders’ deficit		(11,018,116	)		(10,659,818	)
Total liabilities and stockholders’ deficit	$	364,432		$	385,471

The accompanying notes are an integral part of the condensed consolidated financial statements.

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Alseres Pharmaceuticals, Inc.

Consolidated Statements of Comprehensive Loss

(Unaudited)

	For the Three Months Ended March 31,
	2014			2013
Revenues	$	18,432		$	18,432
Operating expenses:
General and administrative		348,159			439,680
Sublicense and option fees		922			—
Operating expenses before accrual reversal		349,081			439,680
Accrual reversal		—			(405,026	)
Total operating expenses		349,081			34,654
Loss from operations		(330,649	)		(16,222	)
Interest expense		(1,365	)		(110,867	)
Realized loss on sale of marketable securities		—			(170,766	)
Net loss	$	(332,014	)	$	(297,855	)
Other comprehensive income
Unrealized gain (loss) on marketable securities: Unrealized holding gain (loss) arising during the year	$	(22,990	)	$	55,492
Less: reclassifications adjustments for loss on sale included in net loss		—			170,766
Net unrealized gain (loss) on marketable securities		(22,990	)		226,258
Comprehensive loss	$	(355,004	)	$	(71,597	)
Basic and diluted net loss attributable to common stockholders per share	$	(0.01	)	$	(0.01	)
Weighted average common shares outstanding		30,635,720			30,635,720

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Alseres Pharmaceuticals, Inc.

Consolidated Statements of Cash Flows

(Unaudited)

	Three Months Ended March 31,
	2014			2013
Cash flows from operating activities:
Net loss	$	(332,014	)	$	(297,855	)
Adjustments to reconcile net loss to net cash used for operating activities:
Amortization and depreciation		—			1,186
Loss on sales of marketable securities		—			170,766
Changes in operating assets and liabilities:
(Increase) decrease in prepaid expenses and other current assets		(22,423	)		14,248
(Increase) decrease in deferred charges		922			922
Increase (decrease) in accounts payable and accrued expenses		(14,621	)		(621,949	)
Increase in accrued interest payable		1,115			110,639
Increase (decrease) in deferred revenue		(18,429	)		(18,432	)
Increase in current liabilities		—			(60,126	)
Net cash used for operating activities		(385,450	)		(700,601	)
Cash flows from investing activities:
Sales and maturities of marketable securities		—			726,934
Net cash provided by investing activities		—			726,934
Cash flows from financing activities:
Advances from related party		—			50,000
Proceeds from issuance of promissory notes		365,000			—
Net cash provided by financing activities		365,000			50,000
Net (decrease) increase in cash and cash equivalents		(20,450	)		76,333
Cash and cash equivalents, beginning of period		113,958			16,528
Cash and cash equivalents, end of period	$	93,508		$	92,861
Supplemental cash flow disclosures:
Net change in unrealized holding gains and losses	$	(20,990	)	$	—
Accretion of Series F Preferred Stock	$	(5,294	)	$	—
Accrued interest recognized upon troubled debt restructuring, currently due	$	(56,298	)	$	—

The accompanying notes are an integral part of the condensed consolidated financial statements.

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Alseres Pharmaceuticals, Inc.

Notes to Consolidated Financial Statements (Unaudited)

March 31, 2014

1. Nature of Operations and Basis of Presentation

Nature of Operations

Alseres Pharmaceuticals, Inc. and its subsidiaries (the “Company”) is a biotechnology company focused on therapeutic and diagnostic products primarily for disorders in the central nervous system. The Company was founded in 1992 and merged with a publicly held company in 1995 (the “Merger”) whereby the Company changed its name to Boston Life Sciences, Inc. Effective June 7, 2007 the Company changed its name to Alseres Pharmaceuticals, Inc. Through 2013 the Company was engaged in the development of its Altropane diagnostic imaging agent for the diagnosis of Parkinson’s disease and dementia with Lewy Bodies. In 2013 the Company began to receive revenues from milestone payments associated with the sublicensing of Altropane in July 2012. Since the Company has begun to receive revenues from its out licensed product and is no longer engaged in development activities; the Company no longer qualifies as a development-stage company for accounting purposes.

As of March 31, 2014, we had experienced total net losses since inception of approximately $199,967,000, stockholders’ deficit of approximately $11,018,000 and a net working capital deficit of approximately $1,385,000. For the foreseeable future, we expect to experience continuing operating losses and negative cash flows from operations. The cash and cash equivalents available at March 31, 2014 will not provide sufficient working capital to meet our anticipated expenditures for the next twelve months. We believe that the approximately $70,000 in cash and cash equivalents available as of May 22, 2014 may enable us to meet our anticipated cash expenditures through June 2014.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, these financial statements do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.

The interim unaudited condensed consolidated financial statements contained herein include, in management’s opinion, all adjustments necessary for a fair statement of the financial position, results of operations, and cash flows for the periods presented. The results of operations for the interim period shown on this report are not necessarily indicative of results for a full year. These financial statements should be read in conjunction with the Company’s consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013.

The accompanying condensed consolidated financial statements have been prepared on a basis which assumes that the Company will continue as a going concern which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The uncertainty inherent in the need to raise additional capital and the Company’s recurring losses from operations raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

2. Summary of Significant Accounting Policies

Cash and Cash Equivalents

Cash equivalents are short-term, highly liquid financial instruments that are readily convertible to cash and have maturities of 90 days or less from the date of purchase. As of March 31, 2014 and December 31, 2013, cash equivalents consisted of money market funds.

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Short-term Investments

The Company has designated its marketable securities as of each balance sheet date as available-for-sale securities and accounts for them at their respective fair values. Marketable securities are classified as short-term or long-term investments based on the nature of these securities and the availability of these securities to meet current operating requirements. Marketable securities that are readily available for use in current operations are classified as short-term available-for-sale securities and are reported as a component of current assets in the accompanying condensed consolidated balance sheets. The Company reviews all available-for-sale securities at each period end to determine if they remain available-for-sale based on the Company’s then current intent and ability to sell the security if it is required to do so. As of March 31, 2014 and December 31, 2013, the Company’s short-term investments include shares of common stock in Navidea Biopharmaceuticals, Inc. (“Navidea” or “NAVB”) These securities are now classified as freely tradeable short term investments. The unrealized loss associated with these marketable securities has been determined to be temporary and therefore has been included in other comprehensive loss as a component of stockholders’ deficit.

Revenue Recognition

The Company evaluates multiple element revenue arrangements under Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 605-25, Multiple-Element Arrangements. In addition to the form of the arrangement, the substance of the arrangement is also considered in determining whether separate agreements entered into, at or near the same time, that include elements that are interrelated or interdependent should be treated as one multiple-element arrangement. If the Company concludes that separate agreements represent one arrangement, then all the elements in the separate agreements are combined into one multiple-element arrangement for accounting purposes.

Revenues from non-refundable license fees are recognized upon receipt of the payment if the license has stand-alone value, we do not have ongoing involvement or obligations and we have determined the best estimate of the selling price for any undelivered items. When non-refundable license fees do not meet all of these criteria, the license revenues are recognized over the expected period of performance.

We will periodically review our expected period of substantial involvement under the agreements that provide for non-refundable up-front payments and license fees. We will adjust the amortization periods when appropriate to reflect changes in assumptions relating to the duration of our expected involvement. We could accelerate revenue recognition for non-refundable upfront payments or license fees in the event of an early termination of the agreements. Alternatively, we could decelerate such revenue recognition if our period of involvement is extended. While changes to such estimates have no impact on our reported cash flows, our reported revenue is significantly influenced by our estimates of the period over which our obligations are expected to be performed and, therefore, over which revenue will be recognized.

Revenues associated with substantive, at-risk milestones pursuant to our licensing agreements are recognized upon achievement of the milestones. We consider a milestone to be substantive at the inception of the arrangement if it is commensurate with either our performance to achieve the milestone or the enhancement of the value of the delivered item as a result of a specific outcome resulting from our performance to achieve the milestone, it relates solely to past performance and it is reasonable relative to all of the deliverables and payment terms within the arrangement. Non-refundable contingent future amounts receivable in connection with future events specified in our licensing agreements that are not considered milestones will be recognized as revenue when payments are earned by our counterparties through completion of any underlying performance obligations, the amounts are fixed or determinable and collectability is reasonably assured.

Comprehensive Income (Loss)

On January 1, 2012, the Company adopted the new presentation requirements under Accounting Standards Update (ASU) 2011-05, “Presentation of Comprehensive Income”. Comprehensive income (loss) consists of net income (loss) and other comprehensive income (loss). Other comprehensive income (loss) includes unrealized gains and losses, net of taxes, on our marketable securities which are also recognized as separate components of equity. ASU 2011-05 requires companies to present the components of net income (loss) and the components of other comprehensive income (loss) either as one continuous statement or as two consecutive statements. In February 2013, the FASB issued ASU 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassifed Out of Accumulated Other Comprehensive Income, which requires an entity to separately present the amount reclassified out of accumulated other comprehensive income (AOCI) for each component of AOCI and to disclose, for each affected line item in the income statement, the amount of AOCI that has been reclassified into that line item. This information must be provided either on the face of the financial statements by income statement line item, or in a footnote. For public companies the amendments in the update became effective for interim or annual periods beginning on or after December 15, 2012. As ASU 2013-02 and ASU 2011-05 impacted

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presentation only, netiher had an effect on the Company’s financial position nor results of operations as of and for the three months ended March 31, 2014 and the year ended December 31, 2013, respectively.

Convertible Redeemable Shares

In accordance with ASC 480, Distinguishing Liabilities from Equity the Company determined that since Series F shares are mandatorily redeemable for cash or for a variable, uncapped, number of common shares, they do not qualify for equity classification.

Income Taxes

The Company accounts for income taxes under the liability method. Under the liability method, deferred income taxes are determined based on differences between the financial reporting and tax bases of assets and liabilities. They are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company is required to adjust its deferred tax liabilities in the period when tax rates or the provisions of the income tax laws change. Valuation allowances are established to reduce deferred tax assets to the amounts expected to be realized.

Restricted Marketable Securities

Pursuant to the terms of the Amended and Restated License Agreement with Harvard University and its affiliated hospitals (“Harvard”) entered into on July 31, 2012, the Company had an obligation to transfer 5,000 shares of the NAVB common stock to Harvard at March 31, 2014 and December 31, 2013. The market value of the 5,000 shares held on March 31, 2014 and December 31, 2013 was $9,250 and $10,350, respectively. The 5,000 shares of NAVB common stock held by the Company at March 31, 2014 and December 31, 2013 is classified as restricted securities in the consolidated balance sheet and the corresponding liability is reported in other current liabilities.

3. Accounts Payable and Accrued Expenses

The Company’s accounts payable and accrued expenses consisted of the following:

	March 31, 2014		December 31, 2013
Research and development expenses	$	430,824	$	470,824
Professional fees		157,942		201,146
General and administrative expenses		374,701		307,883
Compensation related expenses		77,650		75,885
	$	1,041,117	$	1,055,738

On February 15, 2013, the Company entered into Settlement Agreements with Michael Mullen and William Guinness, both members of the Board of Directors of the Company, pursuant to which the Company agreed to satisfy certain outstanding obligations to those individuals which, in aggregate, totaled $167,400 by issuing fully vest options to purchase a total of 167,400 shares of the common stock of Alseres Neurodiagnostics, Inc. ( a wholly owned subsidiary of the Company) at a purchase price to be established by the Company coincident with the closing of an equity financing for Alseres Neurodiagnostics, Inc. The options must be exercised, in whole or in part on or before February 28, 2018. The common stock issued pursuant to the exercise of the options will bear all appropriate restrictive legends on resale or disposition of the common stock. As of March 31, 2014 the options had not yet been issued. Therefore the associated liability of $167,400 remains outstanding and is recorded in accrued expenses on the balance sheet at March 31, 2014. While the fair value of the options will likely be lower than the value of the current liability, the Company has determined it is not appropriate to recognize a gain at this time given the uncertainty of these events and the variability associated with the value of the options.

4. Net Loss per Share

Basic and diluted net loss per share attributable to common stockholders has been calculated by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding during the period. All potentially dilutive common shares have been excluded from the calculation of weighted average common shares outstanding since their inclusion would be anti-dilutive. Stock options to purchase approximately 0.9 million shares of common stock were outstanding at March 31, 2014, but were not included in the computation of diluted net loss per common share because they were anti-dilutive. Stock options to purchase approximately 3.0 million shares of common stock were outstanding at March 31, 2013, but were not included in the computation of diluted net loss per common share because they were anti-dilutive. In computing diluted earnings per share, common stock equivalents in the form of convertible redeemable preferred stock were not included in the calculation of net loss per share as their inclusion would be anti-dilutive. The exercise of stock options outstanding at March 31, 2014 could potentially dilute earnings per share in the future.

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5. Accounting for Stock-Based Compensation

We have one stock option plan under which we can issue both nonqualified and incentive stock options to employees, officers, consultants and scientific advisors of the Company. At March 31, 2014, the 2005 Stock Incentive Plan (the “2005 Plan”) provided for the issuance of options, restricted stock, restricted stock units, stock appreciation rights or other stock-based awards to purchase 3,450,000 shares of our common stock. The 2005 Plan contains a provision that allows for an annual increase in the number of shares available for issuance under the 2005 Plan on the first day of each of the Company’s fiscal years during the period beginning in fiscal year 2006 and ending on the second day of fiscal year 2014. The annual increase in the number of shares shall be equal to the lowest of 400,000 shares; 4% of the Company’s outstanding shares on the first day of the fiscal year; and an amount determined by the Board of Directors. No increase in the number of shares available for issuance was made in January 2014.

We also have outstanding stock options in three other stock option plans, the 1998 Omnibus Plan, the Amended and Restated Omnibus Stock Option Plan and the Amended and Restated 1990 Non-Employee Directors’ Non-Qualified Stock Option Plan. These plans have expired and no future issuance of awards is permissible.

Our Board of Directors determines the term, vesting provisions, price, and number of shares for each award that is granted. The term of each option cannot exceed ten years.

We use the Black-Scholes option-pricing model to calculate the fair value of each option grant on the date of grant. No stock options were granted during the three months ended March 31, 2014 and 2013.

A summary of our outstanding stock options for the three months ended March 31, 2014 and 2013 is presented below.

	2014					2013
	Shares			Weighted Average Exercise Price		Shares		Weighted Average Exercise Price
Outstanding at beginning of period		3,002,480		$	1.51		3,010,980	$	1.51
Granted		—			—		—		—
Exercised		—			—		—		—
Forfeited and expired		(2,147,500	)	$	1.17		—		—
Outstanding at end of period		854,980		$	2.31		3,010,980	$	1.51
Options exercisable at end of period		854,980		$	2.31		3010,980	$	1.51

The following table summarizes information about stock options outstanding and exercisable at March 31, 2014:

Range of Exercise Prices	Number Outstanding		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price
$1.15 — $1.36		150,000		4.8 years	$	1.15
$2.00 — $3.00		539,980		1.5 years		2.33
$3.10 — $4.65		155,000		3.6 years		3.17
$4.99 — $6.96		10,000		.2 years		5.00
		854,980		2.4 years	$	2.31

There was no intrinsic value of outstanding options and exercisable options as of March 31, 2014. As of March 31, 2014, 2,946,672 shares were available for grant under the 2005 Stock Incentive Plan.

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6. Notes Payable and Debt

Through 2013, a series of working capital loans (“Borrowings”) were made to the Company by its significant stockholder, Mr. Robert Gipson, evidenced by demand promissory notes and totaling $7,135,000 and bearing interest at 7% per annum. Interest on these notes was accrued and totaled approximately $1,365,000 at the execution date. On December 31, 2013, the Company executed a Loan Consolidation Agreement with its significant stockholder (“Lender”). The terms of the Borrowings were modified to reduce the interest to be paid and provide for a fixed due date, additional potential borrowings and a security interest in certain assets of the Company. Upon execution of the Loan Consolidation Agreement, all amounts outstanding under the Borrowings including accrued interest were cancelled and considered paid in full and the Company entered into a new Promissory Note (“Consolidated Note”).

The Consolidated Note bears interest at 3.2% per annum payable semi-annually in arrears and requires principal to be repaid on or before December 31, 2016. The Consolidated Note also includes semi-annual cash draws for the future working capital needs of the Company. The draws will be a minimum of $110,000 and are to be added to principal when drawn. Coincident with the execution of the Loan Consolidation Agreement, the Company and the Lender also executed a Security Agreement which provides the Lender with an undivided security interest in and to all personal and intellectual property of the Company subject to all existing liens, encumbrances and license rights previously granted by the Company. The Security Agreement also allows the Company to be free to dispose of or liquidate the collateral without any prior waiver or authorization from the Lender so long as the proceeds of any such disposition are used to pay down the principal on the Consolidated Note or the Lender affirmatively waives such obligation in writing. The Company considered whether the transaction was within the scope of ASC 470-60-55 Accounting for Troubled Debt Restructuring, which states that if a company is experiencing financial difficulties and a concession is granted, troubled debt restructuring accounting should be applied. The Company concluded that it was experiencing financial difficulties and the creditor had granted a concession as the effective borrowing rate for the restructured debt is less than the effective rate of the old debt prior to restructuring. In 2013 the Company recognized a gain of $682,670 equal to the difference between the carrying value of the old debt and the present value of the future cash flows under the new terms. Since the lender is a related party, the gain was considered in essence to be a capital transaction and therefore, the gain was recognized as an increase to additional paid in capital. Additionally, due to this restructuring, future payments made will be charged to the carrying value of the restructured debt balance and no interest expense will be recorded going forward.

During the three months ended March 31, 2014, the Company borrowed an additional $365,000 under the Consolidated Note. Interest expense of $1,115 was recognized for the 3 month period ended March 31, 2014. The accrued interest balance at March 31, 2014 represents the accrued interest of $1,115 associated with the additional borrowings and the current portion of the restructured debt balance, which is interest only.

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7. Convertible Preferred Stock

The Company’s Series F Convertible, Redeemable Preferred Stock (“Series F Stock”) can be converted into 25 shares of common stock pursuant to the conversion terms of the Series F Stock contained in the Certificate of Designation for the Series F Stock. All shares of Series F Stock were sold to Robert Gipson in 2009 at $25 per share, yielding the Company aggregate proceeds of $4,600,000. As of March 31, 2014, 12,000 shares of Series F Stock were outstanding and held by Robert Gipson.

8. Commitments and Contingencies

We recognize and disclose commitments when we enter into executed contractual obligations with third parties. We accrue contingent liabilities when it is probable that future expenditures will be made and such expenditures can be reasonably estimated.

On March 13, 2012 the Company received notice that Children’s Hospital Boston and Children’s Medical Center Corporation had filed a lawsuit in Middlesex Superior Court, Middlesex County, Massachusetts seeking to recover amounts alleged to be owed by the Company to the plaintiffs.

On February 1, 2013 the Company entered into a Settlement Agreement and Release with Boston Children’s Hospital (BCH) and Children’s Medical Center Corporation (CMCC) in full settlement of the lawsuit filed by BCH and CMCC seeking to recover amounts alleged to be owed by the Company to the plaintiffs totaling $642,906 plus costs.

In settlement of all claims by BCH and CMCC, the Company agreed to pay a lump sum of $185,000 to the plaintiffs. In addition to the lump sum payment, the Company agreed to pay to the plaintiffs an additional sum equal to the then cash value of 20,000 shares of the common stock of Navidea upon the occurrence of the first milestone described in Section 4.2 of the sublicense agreement dated as of July 31, 2012 between Navidea and the Company. The milestone occurred in December, 2013 at which time the value of 20,000 shares of Navidea common stock was $40,000. The Company paid CMCC the sum of $40,000 in January 2014 in accordance with the terms of the Settlement Agreement and Release.

9. Income taxes

The Company is subject to both federal and state income tax for the jurisdiction within which it operates. Within these jurisdictions, the Company is open to examination for tax years ended December 31, 2010 through December 31, 2013. The U.S. Internal Revenue Service (IRS) has completed an audit of tax years 2007 and 2008 and has informed us that no adjustments to the federal tax returns as filed will be proposed as a result of the audit. However, because we are carrying forward income tax attributes such as a net operating loss (“NOL”) from 2006, these attributes can still be audited when utilized on returns filed in the future.

10. Fair Value Measurements

The fair value hierarchy prioritizes observable and unobservable inputs used to measure fair value into three broad levels:

Level 1 — unadjusted quoted prices in active markets for identical securities;

Level 2 — unadjusted quoted prices in markets that are not active,

Level 3 — significant unobservable inputs, including our own assumptions in determining fair value

The following table summarizes the financial assets that we measured at fair value as of March 31, 2013 and December 31, 2012.

	March 31, 2014
	Level 1		Level 2		Level 3		Total
Available for sale securities	$	175,660	$	—	$	—	$	175,660

	December 31, 2013
	Level 1		Level 2		Level 3		Total
Available for sale securities	$	196,650	$	—	$	—	$	196,650

As of March 31, 2014 and December 31, 2013, the Company’s Level 1 short-term investments consist of 95,000 shares of Navidea common stock which are traded on the NYSE under the symbol NAVB.

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11. Related Party Transaction. During the first three months of 2014, Robert Gipson provided a total of $365,000 to the Company as an increase to the Consolidate Note referenced in Note 6 above.

12. Subsequent Events

The Company evaluated all events and transactions that occurred after the balance sheet date through the date of this filing. During this period the Company did not have any material recognizable or disclosable subsequent events.

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

Our management’s discussion and analysis of our financial condition and results of operations include the identification of certain trends and other statements that may predict or anticipate future business or financial results that are subject to important factors that could cause our actual results to differ materially from those indicated. Carefully review the risks outlined in other documents that we file from time to time with the SEC.

Overview

Description of Company

We are a biotechnology company focused on diagnostic products primarily for disorders in the central nervous system, or CNS. Our clinical product candidate is called Altropane and is a molecular imaging program focused on the diagnosis of i) Parkinsonian Syndromes, or PS, including Parkinson’s Disease, or PD, and ii) Dementia with Lewy Bodies, or DLB;

Product Development — Molecular Imaging Program

Altropane Molecular Imaging Agent

On July 31, 2012 we executed a License Agreement with Navidea Biopharmaceuticals, Inc. (“Navidea” or “NAVB”) under which we granted Navidea an exclusive, worldwide sublicense to research, develop, and commercialize Altropane. Altropane is an Iodine-123 radiolabeled imaging agent which is being developed as an aid in the diagnosis of Parkinson’s disease and movement disorders. Under the terms of the sublicense agreement, Navidea has agreed to use its best commercial efforts to develop and launch Altropane in accordance with an agreed to development plan for the product. Navidea will be responsible for conducting and funding all future development, regulatory filings, manufacturing and global commercialization of Altropane. The Company will have no further cost obligations related to Altropane. In connection with the execution of this agreement, Navidea made a one-time sublicense execution payment to us equal to (i) One Hundred Seventy-Five Thousand Dollars ($175,000) and (ii) issued us 300,000 shares of NAVB common stock.

The license agreement also provides for contingent milestone payments of up to $2.9 million, $2.5 million of which will principally occur at the time of product registration or upon commercial sales, and the issuance of up to an additional 1.15 million shares of Navidea stock, 950,000 shares of which are issuable at the time of product registration or upon commercial sales. In addition, the license terms anticipate royalties on

12

yearly net sales of the approved product which are consistent with industry-standard terms and certain license extension fees, payable in cash and shares of common stock, in the event certain milestones are not met.

We have licensed worldwide exclusive rights to develop Altropane from Harvard University and its affiliated hospitals, which we refer to as “Harvard”, including the Massachusetts General Hospital. The license agreement provides for milestone payments and royalties based on product sales that are consistent with industry averages for such products.

Central Nervous System Diagnostic Centers Opportunity

We are presently conducting a preliminary feasibility assessment for a new business focused on organizing and operating a US network of Diagnostic Centers concentrating on neurodegenerative conditions. If the business is deemed to be feasible and moves forward, we intend to operate it through our subsidiary, Alseres Neurodiagnostics, Inc. We have entered the decade of the brain. The cost of caring for people with degenerative brain disease, trauma induced brain dysfunction and psychiatric brain disorders is projected to surpass that of cancer and heart disease combined by 2030. Today, progressive degenerative brain diseases like Alzheimer’s, Parkinson’s and Lewy Body Dementia are clinically diagnosed and therefore go undetected for up to 20 years. Neither patients, nor physicians, nor scientists can benefit from early stage diagnosis and treatment.

The diagnostic and treatment landscape is changing. Multi-modal diagnostic tools that combine inexpensive, convenient, predictive in-vitro diagnostic tests, in-vivo visualization tools and data interpretation algorithms are here, with more on the horizon. These advances coupled with new developments in disease modifying drugs and devices will fuel demand for accurate, precise CNS data to predict, diagnose and treat these devastating conditions.

The number of Americans living with neurodegenerative movement disorders such as Parkinson’s disease, and dementias like Alzheimer’s and Dementia with Lewy Bodies, is expected to grow from 20 million in 2010 to 30 million by 2030. By 2050, that number is expected to grow to 40 million. Unchecked and without accounting for loss of productivity, the annual cost of care for patients with these diseases will grow from $200 billion today to $500 billion by 2030.

Today, PD, AD and DLB are diagnosed post-symptomatically. By the time diagnosable clinical symptoms appear, the disease is in an advanced stage. The disease has already progressed well beyond the point that current therapies have been shown to have disease modifying effects. Drugs in development are routinely tested in patients with advanced stage disease, where the drugs are least likely to have the disease modifying or arresting affect desired. What is needed are:

• Early detection, definitive diagnostics and therapeutic drug monitoring tools; and

• Comprehensive, longitudinal data to enable disease modifying treatments for early stage degenerative brain diseases

The new business would be tasked with taking full advantage of a proprietary multi-modal diagnostic toolkit to cost-effectively provide:

• Patients, physicians and caregivers with the information they need to predict, diagnose, monitor and manage CNS disease progression; and

• Scientists with information and access to the well-characterized, early stage patients they need to discover, develop and commercialize predictive, diagnostic, therapeutic and preventative products.

The clinics will capture clinical samples and longitudinal patient data and analyses that will be retained in a central location. They will utilize state-of-the-art imaging technology, clinical diagnostic equipment and in-vitro diagnostic tools. All clinics will operate under standard, network-wide screening, imaging, interpretation and data acquisition protocols ensuring quality control and consistency of patient data and interpretation.

The clinics will provide screening, diagnosis and on-going monitoring of both pre-symptomatic and symptomatic patients affected by neurodegenerative brain disorders. The clinics will take advantage of currently available in-vitro diagnostics as well as imaging diagnostics to identify patients who are “at risk” of developing degenerative brain disorders. We are working, on a confidential basis, with industry participants to assess possible support for the development of the potential new business including capital and human resources.

At present our work on this opportunity is preliminary and is focused on identifying an initial location for a pilot site intended to demonstrate the proof of concept for the centers and accessing potential sources of capital. We can provide no assurance that this business will ever be launched or that the capital and human resources necessary to launch and grow the new business will be available on acceptable terms if at all.

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Critical Accounting Policies and Estimates

Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements which have been prepared by us in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. Our estimates include those related to marketable securities, research contracts and the fair value and classification of financial instruments. We base our estimates on historical experience and on various other assumptions that we believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions.

Results of Operations for the Three Months Ended March 31, 2014 and 2013

For the three months ended March 31, 2014, the Company recognized revenue of $18,432 compared to $18,432 for the three months ended March 31, 2013. The 2014 and 2013 revenue reflects the ratable recognition of the $1,321,000 upfront sublicense fee received from Navidea on July 31, 2012. Revenue will be recognized ratably from the date the sublicense agreement became effective (July 31, 2012) through the expected life of the U.S. patent for Altropane (June 30, 2030).

Our net loss was $332,014 for the three months ended March 31, 2014 compared to a net loss of $297,855 for the three months ended March 31, 2013. The net loss for the three months ended March 31, 2014 resulted from operating expenses of approximately $349,000 and interest expense of approximately $1,000 partially offset by revenues of approximately $18,000. The net loss of $297,855 for the three months ended March 31, 2013 was attributable to operating expenses of approximately $34,600 and interest expense of approximately $110,000 partially offset by revenues of $18,000.

Research and development expenses were $0 for the three months ended March 31, 2014 and March 31, 2013 respectively.

General and administrative expenses were $348,159 during the three months ended March 31, 2014 compared to $439,680 during the three months ended March 31, 2013. The decrease of $91,521 was principally attributable to across the board reductions in operating expenses including facilities, IT staff, utilities and other overhead costs.

Interest expense of $1,365 was incurred during the three months ended March 31, 2014 compared to $110,867 during the three months ended March 31, 2013.

Liquidity and Capital Resources

As of March 31, 2014, we had experienced total net losses since inception of approximately $199,967,000, stockholders’ deficit of approximately $11,018,000 and a net working capital deficit of approximately $1,385,000. For the foreseeable future, we expect to experience continuing operating losses and negative cash flows from operations as we execute our current business plan. The cash and cash equivalents available at March 31, 2014 will not provide sufficient working capital to meet our anticipated expenditures for the next twelve months. We believe that the approximately $70,000 in cash and cash equivalents available as of May 22, 2014 may enable us to meet our anticipated cash expenditures through June 2014.

Operating Activities

Net cash used for operating activities was $385,450 for the three months ended March 31, 2014 compared to $700,601 for the three months ended March 31, 2013. Net cash used for operating activities for the three months ended March 31, 2014 reflects our continued curtailment of operations pending additional funding.

Investing Activities

Cash was provided by investing activities for the three months ended March 31, 2014 was $0 compared to $726,934 for the three months ended March 31, 2013 resulting from the sale of our Navidea common stock in 2013.

Financing Activities

Financing activities provided cash of $365,000 for the three months ended March 31, 2014 compared to $50,000 for the three months ended March 31, 2013. Cash provided by financing activities for the three months ended March 31, 2014 reflects the proceeds from additional promissory note issuance to Mr. Robert Gipson.

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To date, we have dedicated most of our financial resources to the research and development of our product candidates, general and administrative expenses (including costs related to obtaining and protecting patents). Since inception, we have primarily satisfied our working capital requirements from the sale of our securities through private placements. These private placements have included the sale and issuance of preferred stock, common stock, promissory notes and convertible debentures.

In order to continue as a going concern, we will need to raise additional capital through one or more of the following: a debt financing, an equity offering, or a collaboration, merger, acquisition or other transaction with one or more pharmaceutical or biotechnology companies. We are currently engaged in fundraising efforts. There can be no assurance that we will be successful in our fundraising efforts or that additional funds will be available on acceptable terms, if at all. We also cannot be sure that we will be able to obtain additional credit from, or effect additional sales of debt or equity securities to certain of our existing investors in which case we may need to cease operations or reduce, cease or delay one or more of our research or development programs and/or adjust our current business plan and in any such event may not be able to continue as a going concern.

Item 3 — Quantitative and Qualitative Disclosures about Market Risk

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, we are not required to provide this information.

Item 4 — Controls and Procedures

Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.

In the course of its assessment for fiscal year 2013, management identified a control deficiency that was also identified during its assessments for the 2012 fiscal year. During the course of the previous year’s evaluation, and again during the evaluation for the 2013 fiscal year, management determined that the Company lacked sufficient staff to segregate accounting duties. Management believes this control deficiency is primarily the result of the Company employing, due to its limited size, the equivalent of only one person performing all accounting-related on-site duties. As a result, Alseres does not maintain adequate segregation of duties within its critical financial reporting applications, the related modules and financial reporting processes. This control deficiency could result in a misstatement of our interim or annual consolidated financial statements that would not be detected. Accordingly, management has determined that this control deficiency constituted a material weakness, and that the Company’s internal control over financial reporting was not effective, as of December 31, 2013. We believe this deficiency continued through March 31, 2014.

Management has discussed the material weakness and related potential corrective actions with the Audit Committee and Board of Directors of the Company and Alseres’ independent registered public accounting firm. As part of our 2014 assessment of internal control over financial reporting, our management will test and evaluate additional controls implemented, if any, to assess whether they are operating effectively. Our goal is to take all actions possible given our financial condition to remediate any material weakness and enhance our internal controls, but we cannot guarantee that our efforts, if any, will result in the remediation of our material weakness or that new issues will not be exposed in the process. In designing and evaluating our internal control over financial reporting, management recognizes that any controls, no matter how well designed and operated, can provide only reasonable, but not absolute, assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, with the Company will be detected.

Part II — OTHER INFORMATION

The disclosure contained under the heading “Contingencies” in Note 9 to the condensed consolidated financial statements included in Part I, Item 1 hereof is incorporated herein by reference.

Statements contained or incorporated by reference in this Quarterly Report on Form 10-Q that are not based on historical fact are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act. These forward-looking statements regarding future events and our future results are based on current expectations, estimates, forecasts, and projections, and the beliefs and assumptions of our management including, without limitation, our expectations regarding our product candidates, including the success and timing of our preclinical, clinical and development programs, the submission of regulatory filings and proposed partnering arrangements, the outcome of any litigation, collaboration, merger, acquisition and

15

fund raising efforts, results of operations, selling, general and administrative expenses, research and development expenses and the sufficiency of our cash for future operations. Forward-looking statements may be identified by the use of forward-looking terminology such as “may,” “could,” “will,” “expect,” “estimate,” “anticipate,” “continue,” or similar terms, variations of such terms or the negative of those terms.

We cannot assure investors that our assumptions and expectations will prove to have been correct. Important factors could cause our actual results to differ materially from those indicated or implied by forward-looking statements. Such factors that could cause or contribute to such differences include those factors discussed below. We undertake no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Item 6 — Exhibits

31.1*	Certification of the Chief Executive Officer pursuant to Section 1350 of Title 18, United States Code, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	Certification of the Chief Financial Officer pursuant to Section 1350 of Title 18, United States Code, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*	Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*	Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*	XBRL Instance Document
101.SCH*	XBRL Taxonomy Extension Schema Document
101.CAL*	XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB*	XBRL Taxonomy Extension Label Linkbase Document
101.PRE*	XBRL Taxonomy Presentation Linkbase Document
101.DEF*	XBRL Taxonomy Definition Linkbase Document

* Filed herewith.

16

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	ALSERES PHARMACEUTICALS, INC (Registrant)
DATE: May 23, 2014	/s/ PETER G. SAVAS
	Peter G. Savas
	Chief Executive Officer (Principal Executive Officer)
DATE: May 23, 2014	/s/ KENNETH L. RICE, JR.
	Kenneth L. Rice, Jr.
	Executive Vice President Finance and Administration And Chief Financial Officer (Principal Financial and Accounting Officer)

17

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Peter G. Savas, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Alseres Pharmaceuticals, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a 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 fiscal 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 the 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 control 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 23, 2014	/S/ PETER G. SAVAS
	Peter G. Savas
	Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, Kenneth L. Rice, Jr., certify that:

1. I have reviewed this quarterly report on Form 10-Q of Alseres Pharmaceuticals, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a 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 fiscal 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 the 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 control 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 23, 2014	/S/ KENNETH L. RICE, JR.
	Kenneth L. Rice, Jr.
	Executive Vice President Finance and Administration and Chief Financial 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

In connection with the Quarterly Report of Alseres Pharmaceuticals, Inc. (the “Company”) on Form 10-Q for the quarter ended March 31, 2014 as filed with the Securities and Exchange Commission (the “Report”), I, Peter G. Savas, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ PETER G. SAVAS

Peter G. Savas

Chief Executive Officer

Date: May 23, 2014

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Alseres Pharmaceuticals, Inc. (the “Company”) on Form 10-Q for the quarter ended March 31, 2014 as filed with the Securities and Exchange Commission (the “Report”), I, Kenneth L. Rice, Jr., Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/S/ KENNETH L. RICE, JR.

Kenneth L. Rice, Jr.

Executive Vice President Finance and Administration

and Chief Financial Officer

Date: May 23, 2014

XML

Income Taxes - Additional Information (Detail) (USD $)	3 Months Ended
	Mar. 31, 2014
Income Tax Examination [Line Items]
Tax years open to examination	Years ended December 31, 2010 through December 31, 2013.
Adjustments to the federal tax returns	$ 0
Internal Revenue Service (IRS) [Member] | Minimum [Member]
Income Tax Examination [Line Items]
Tax years under audit	2007
Internal Revenue Service (IRS) [Member] | Maximum [Member]
Income Tax Examination [Line Items]
Tax years under audit	2008

XML

Accounts Payable and Accrued Expenses - Additional Information (Detail) (USD $)	3 Months Ended
	Mar. 31, 2014	Feb. 15, 2013
Payables And Accruals [Abstract]
Vested options to purchase of common stock		$ 167,400
Vested options to purchase of common stock, Shares		167,400
Options exercised expiration date	Feb. 28, 2018
Outstanding liability under settlement agreement	$ 167,400

XML

Net Loss per Share

3 Months Ended

Mar. 31, 2014

Earnings Per Share [Abstract]

Net Loss per Share

4. Net Loss per Share

Basic and diluted net loss per share attributable to common stockholders has been calculated by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding during the period. All potentially dilutive common shares have been excluded from the calculation of weighted average common shares outstanding since their inclusion would be anti-dilutive. Stock options to purchase approximately 0.9 million shares of common stock were outstanding at March 31, 2014, but were not included in the computation of diluted net loss per common share because they were anti-dilutive. Stock options to purchase approximately 3.0 million shares of common stock were outstanding at March 31, 2013, but were not included in the computation of diluted net loss per common share because they were anti-dilutive. In computing diluted earnings per share, common stock equivalents in the form of convertible redeemable preferred stock were not included in the calculation of net loss per share as their inclusion would be anti-dilutive. The exercise of stock options outstanding at March 31, 2014 could potentially dilute earnings per share in the future.

XML

Accounting for Stock-Based Compensation - Summary of Stock Options Outstanding and Exercisable (Detail) (USD $)	3 Months Ended
	Mar. 31, 2014
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Number Outstanding	854,980
Weighted Average Remaining Contractual Life	2 years 4 months 24 days
Weighted Average Exercise Price	$ 2.31
Range of Exercise Prices from $1.15 to $1.36 [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Minimum Range of Exercise Price	$ 1.15
Maximum Range of Exercise Price	$ 1.36
Number Outstanding	150,000
Weighted Average Remaining Contractual Life	4 years 9 months 18 days
Weighted Average Exercise Price	$ 1.15
Range of Exercise Prices from $2.00 to $3.00 [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Minimum Range of Exercise Price	$ 2.00
Maximum Range of Exercise Price	$ 3.00
Number Outstanding	539,980
Weighted Average Remaining Contractual Life	1 year 6 months
Weighted Average Exercise Price	$ 2.33
Range of Exercise Prices from $3.10 to $4.65 [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Minimum Range of Exercise Price	$ 3.10
Maximum Range of Exercise Price	$ 4.65
Number Outstanding	155,000
Weighted Average Remaining Contractual Life	3 years 7 months 6 days
Weighted Average Exercise Price	$ 3.17
Range of Exercise Prices from $4.99 to $6.96 [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Minimum Range of Exercise Price	$ 4.99
Maximum Range of Exercise Price	$ 6.96
Number Outstanding	10,000
Weighted Average Remaining Contractual Life	2 months 12 days
Weighted Average Exercise Price	$ 5.00

XML

Accounting for Stock-Based Compensation - Summary of Outstanding Stock Options (Detail) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Outstanding at beginning of period, Shares	3,002,480	3,010,980
Granted, Shares
Exercised, Shares
Forfeited and expired, Shares	(2,147,500)
Outstanding at end of period, Shares	854,980	3,010,980
Options exercisable at end of period, Shares	854,980	3,010,980
Outstanding at beginning of period, Weighted Average Exercise Price	$ 1.51	$ 1.51
Granted, Weighted Average Exercise Price
Exercised, Weighted Average Exercise Price
Forfeited and expired, Weighted Average Exercise Price	$ 1.17
Outstanding at end of period, Weighted Average Exercise Price	$ 2.31	$ 1.51
Options exercisable at end of period, Weighted Average Exercise Price	$ 2.31	$ 1.51

XML

Notes Payable and Debt - Additional Information (Detail) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Debt Instrument [Line Items]
Promissory notes demanded	$ 7,135,000
Interest rate on promissory notes	7.00%
Accrued interest	1,365,000
Interest rate on new note payable semi-annually in arrears	3.20%
Principal due date	Dec. 31, 2016
Minimum draw amount	110,000
Recognized gain	682,670
Additional borrowings under Consolidated Note	365,000
Interest expense	1,365	110,867
Additional Borrowing Loans Member
Debt Instrument [Line Items]
Accrued interest	1,115
Interest expense	$ 1,115

XML

Convertible Preferred Stock - Additional Information (Detail) (Series F Preferred Stock [Member], USD $)	3 Months Ended
	Mar. 31, 2014	Dec. 31, 2013
Temporary Equity [Line Items]
Convertible preferred stock price per share	$ 25
Proceeds from sale of convertible preferred stock	$ 4,600,000
Redeemable convertible preferred stock, shares outstanding	12,000	12,000
Convertible Preferred Stock [Member]
Temporary Equity [Line Items]
Series F Stock converted common stock	25

XML

Accounts Payable and Accrued Expenses

3 Months Ended

Mar. 31, 2014

Payables And Accruals [Abstract]

Accounts Payable and Accrued Expenses

3. Accounts Payable and Accrued Expenses

The Company’s accounts payable and accrued expenses consisted of the following:

	March 31, 2014		December 31, 2013
Research and development expenses	$	430,824	$	470,824
Professional fees		157,942		201,146
General and administrative expenses		374,701		307,883
Compensation related expenses		77,650		75,885
	$	1,041,117	$	1,055,738

On February 15, 2013, the Company entered into Settlement Agreements with Michael Mullen and William Guinness, both members of the Board of Directors of the Company, pursuant to which the Company agreed to satisfy certain outstanding obligations to those individuals which, in aggregate, totaled $167,400 by issuing fully vest options to purchase a total of 167,400 shares of the common stock of Alseres Neurodiagnostics, Inc. ( a wholly owned subsidiary of the Company) at a purchase price to be established by the Company coincident with the closing of an equity financing for Alseres Neurodiagnostics, Inc. The options must be exercised, in whole or in part on or before February 28, 2018. The common stock issued pursuant to the exercise of the options will bear all appropriate restrictive legends on resale or disposition of the common stock. As of March 31, 2014 the options had not yet been issued. Therefore the associated liability of $167,400 remains outstanding and is recorded in accrued expenses on the balance sheet at March 31, 2014. While the fair value of the options will likely be lower than the value of the current liability, the Company has determined it is not appropriate to recognize a gain at this time given the uncertainty of these events and the variability associated with the value of the options.

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Commitments and Contingencies - Additional Information (Detail) (USD $)	0 Months Ended	3 Months Ended	12 Months Ended	1 Months Ended
	Feb. 01, 2013 Boston Children's Hospital and Children's Medical Center Corporation [Member]	Mar. 31, 2014 Boston Children's Hospital and Children's Medical Center Corporation [Member]	Dec. 31, 2013 Boston Children's Hospital and Children's Medical Center Corporation [Member]	Jan. 31, 2014 CMCC [Member]
Loss Contingencies [Line Items]
Amount claimed	$ 642,906
Amount of agreed settlement paid		185,000
Shares received against execution of sublicense granted		20,000
Value of common stock for settlement of claims			$ 40,000	$ 40,000

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Consolidated Balance Sheets (Unaudited) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Current assets:
Cash and cash equivalents	$ 93,508	$ 113,958
Short-term investments	175,660	196,650
Restricted marketable securities	9,250	10,350
Prepaid expenses and other current assets	26,109	3,686
Total current assets	304,527	324,644
Deferred charges	59,905	60,827
Total assets	364,432	385,471
Current liabilities:
Accounts payable and accrued expenses	1,041,117	1,055,738
Accrued interest on notes payable	63,043	5,630
Deferred revenue	73,731	73,731
Other current liabilities	12,121	13,221
Advances from related party	500,000	500,000
Total current liabilities	1,690,012	1,648,320
Note payable	8,128,662	7,819,960
Deferred revenue, net of current portion	1,124,387	1,142,816
Other long-term liabilities	43,750	43,750
Total liabilities	10,986,811	10,654,846
Commitments and contingencies
Series F convertible redeemable preferred stock, $.01 par value; 200,000 shares designated; 12,000 shares issued and outstanding at March 31, 2014 and December 31, 2013, (liquidation preference of $300,000 at March 31, 2014)	395,737	390,443
Stockholders' deficit:
Common stock, $.01 par value; 80,000,000 shares authorized at March 31, 2014 and December 31, 2013; 30,635,720 issued and outstanding at March 31, 2014 and December 31, 2013	306,357	306,357
Additional paid-in capital	188,656,954	188,662,248
Accumulated other comprehensive income ( loss)	(14,340)	6,650
Deficit accumulated	(199,967,087)	(199,635,073)
Total stockholders' deficit	(11,018,116)	(10,659,818)
Total liabilities and stockholders' deficit	$ 364,432	$ 385,471

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Nature of Operations and Basis of Presentation

3 Months Ended

Mar. 31, 2014

Accounting Policies [Abstract]

Nature of Operations and Basis of Presentation

1. Nature of Operations and Basis of Presentation

Nature of Operations

Alseres Pharmaceuticals, Inc. and its subsidiaries (the “Company”) is a biotechnology company focused on therapeutic and diagnostic products primarily for disorders in the central nervous system. The Company was founded in 1992 and merged with a publicly held company in 1995 (the “Merger”) whereby the Company changed its name to Boston Life Sciences, Inc. Effective June 7, 2007 the Company changed its name to Alseres Pharmaceuticals, Inc. Through 2013 the Company was engaged in the development of its Altropane diagnostic imaging agent for the diagnosis of Parkinson’s disease and dementia with Lewy Bodies. In 2013 the Company began to receive revenues from milestone payments associated with the sublicensing of Altropane in July 2012. Since the Company has begun to receive revenues from its out licensed product and is no longer engaged in development activities; the Company no longer qualifies as a development-stage company for accounting purposes.

As of March 31, 2014, we had experienced total net losses since inception of approximately $199,967,000, stockholders’ deficit of approximately $11,018,000 and a net working capital deficit of approximately $1,385,000. For the foreseeable future, we expect to experience continuing operating losses and negative cash flows from operations. The cash and cash equivalents available at March 31, 2014 will not provide sufficient working capital to meet our anticipated expenditures for the next twelve months. We believe that the approximately $70,000 in cash and cash equivalents available as of May 22, 2014 may enable us to meet our anticipated cash expenditures through June 2014.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, these financial statements do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.

The interim unaudited condensed consolidated financial statements contained herein include, in management’s opinion, all adjustments necessary for a fair statement of the financial position, results of operations, and cash flows for the periods presented. The results of operations for the interim period shown on this report are not necessarily indicative of results for a full year. These financial statements should be read in conjunction with the Company’s consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013.

The accompanying condensed consolidated financial statements have been prepared on a basis which assumes that the Company will continue as a going concern which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The uncertainty inherent in the need to raise additional capital and the Company’s recurring losses from operations raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

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Fair Value Measurements - Additional Information (Detail) (Fair Value, Measurements, Recurring [Member], Level 1 [Member], NAVB Stock [Member])	Mar. 31, 2014	Dec. 31, 2013
Fair Value, Measurements, Recurring [Member] | Level 1 [Member] | NAVB Stock [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments shares	95,000	95,000

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Nature of Operations and Basis of Presentation - Additional Information (Detail) (USD $)			3 Months Ended
	Mar. 31, 2014	Dec. 31, 2013	Mar. 31, 2014 Inception [Member]	May 22, 2014 Subsequent Event [Member]
Organization And Nature Of Operations [Line Items]
Net losses since inception			$ 199,967,000
Estimated cash and cash equivalents				70,000
Stockholders' deficit	(11,018,116)	(10,659,818)	(11,018,000)
Net working capital deficit	$ 1,385,000

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Related Party Transaction - Additional Information (Detail) (USD $)	3 Months Ended
	Mar. 31, 2014
Related Party Transaction [Line Items]
Related party transaction, amount received	$ 365,000
Robert Gipson [Member]
Related Party Transaction [Line Items]
Related party transaction, amount received	$ 365,000

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Accounts Payable and Accrued Expenses - Summary of Accounts Payable and Accrued Expenses (Detail) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Accounts Payable And Accrued Liabilities Current [Line Items]
Accounts payable and accrued expenses	$ 1,041,117	$ 1,055,738
Research and Development Expenses [Member]
Accounts Payable And Accrued Liabilities Current [Line Items]
Accounts payable and accrued expenses	430,824	470,824
Professional Fees [Member]
Accounts Payable And Accrued Liabilities Current [Line Items]
Accounts payable and accrued expenses	157,942	201,146
General and Administrative Expenses [Member]
Accounts Payable And Accrued Liabilities Current [Line Items]
Accounts payable and accrued expenses	374,701	307,883
Compensation Related Expenses [Member]
Accounts Payable And Accrued Liabilities Current [Line Items]
Accounts payable and accrued expenses	$ 77,650	$ 75,885

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Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2014

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

Cash and Cash Equivalents

Cash equivalents are short-term, highly liquid financial instruments that are readily convertible to cash and have maturities of 90 days or less from the date of purchase. As of March 31, 2014 and December 31, 2013, cash equivalents consisted of money market funds.

Short-term Investments

The Company has designated its marketable securities as of each balance sheet date as available-for-sale securities and accounts for them at their respective fair values. Marketable securities are classified as short-term or long-term investments based on the nature of these securities and the availability of these securities to meet current operating requirements. Marketable securities that are readily available for use in current operations are classified as short-term available-for-sale securities and are reported as a component of current assets in the accompanying condensed consolidated balance sheets. The Company reviews all available-for-sale securities at each period end to determine if they remain available-for-sale based on the Company’s then current intent and ability to sell the security if it is required to do so. As of March 31, 2014 and December 31, 2013, the Company’s short-term investments include shares of common stock in Navidea Biopharmaceuticals, Inc. (“Navidea” or “NAVB”) These securities are now classified as freely tradeable short term investments. The unrealized loss associated with these marketable securities has been determined to be temporary and therefore has been included in other comprehensive loss as a component of stockholders’ deficit.

Revenue Recognition

The Company evaluates multiple element revenue arrangements under Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 605-25, Multiple-Element Arrangements. In addition to the form of the arrangement, the substance of the arrangement is also considered in determining whether separate agreements entered into, at or near the same time, that include elements that are interrelated or interdependent should be treated as one multiple-element arrangement. If the Company concludes that separate agreements represent one arrangement, then all the elements in the separate agreements are combined into one multiple-element arrangement for accounting purposes.

Revenues from non-refundable license fees are recognized upon receipt of the payment if the license has stand-alone value, we do not have ongoing involvement or obligations and we have determined the best estimate of the selling price for any undelivered items. When non-refundable license fees do not meet all of these criteria, the license revenues are recognized over the expected period of performance.

We will periodically review our expected period of substantial involvement under the agreements that provide for non-refundable up-front payments and license fees. We will adjust the amortization periods when appropriate to reflect changes in assumptions relating to the duration of our expected involvement. We could accelerate revenue recognition for non-refundable upfront payments or license fees in the event of an early termination of the agreements. Alternatively, we could decelerate such revenue recognition if our period of involvement is extended. While changes to such estimates have no impact on our reported cash flows, our reported revenue is significantly influenced by our estimates of the period over which our obligations are expected to be performed and, therefore, over which revenue will be recognized.

Revenues associated with substantive, at-risk milestones pursuant to our licensing agreements are recognized upon achievement of the milestones. We consider a milestone to be substantive at the inception of the arrangement if it is commensurate with either our performance to achieve the milestone or the enhancement of the value of the delivered item as a result of a specific outcome resulting from our performance to achieve the milestone, it relates solely to past performance and it is reasonable relative to all of the deliverables and payment terms within the arrangement. Non-refundable contingent future amounts receivable in connection with future events specified in our licensing agreements that are not considered milestones will be recognized as revenue when payments are earned by our counterparties through completion of any underlying performance obligations, the amounts are fixed or determinable and collectability is reasonably assured.

Comprehensive Income (Loss)

On January 1, 2012, the Company adopted the new presentation requirements under Accounting Standards Update (ASU) 2011-05, “Presentation of Comprehensive Income”. Comprehensive income (loss) consists of net income (loss) and other comprehensive income (loss). Other comprehensive income (loss) includes unrealized gains and losses, net of taxes, on our marketable securities which are also recognized as separate components of equity. ASU 2011-05 requires companies to present the components of net income (loss) and the components of other comprehensive income (loss) either as one continuous statement or as two consecutive statements. In February 2013, the FASB issued ASU 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassifed Out of Accumulated Other Comprehensive Income, which requires an entity to separately present the amount reclassified out of accumulated other comprehensive income (AOCI) for each component of AOCI and to disclose, for each affected line item in the income statement, the amount of AOCI that has been reclassified into that line item. This information must be provided either on the face of the financial statements by income statement line item, or in a footnote. For public companies the amendments in the update became effective for interim or annual periods beginning on or after December 15, 2012. As ASU 2013-02 and ASU 2011-05 impacted

presentation only, netiher had an effect on the Company’s financial position nor results of operations as of and for the three months ended March 31, 2014 and the year ended December 31, 2013, respectively.

Convertible Redeemable Shares

In accordance with ASC 480, Distinguishing Liabilities from Equity the Company determined that since Series F shares are mandatorily redeemable for cash or for a variable, uncapped, number of common shares, they do not qualify for equity classification.

Income Taxes

The Company accounts for income taxes under the liability method. Under the liability method, deferred income taxes are determined based on differences between the financial reporting and tax bases of assets and liabilities. They are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company is required to adjust its deferred tax liabilities in the period when tax rates or the provisions of the income tax laws change. Valuation allowances are established to reduce deferred tax assets to the amounts expected to be realized.

Restricted Marketable Securities

Pursuant to the terms of the Amended and Restated License Agreement with Harvard University and its affiliated hospitals (“Harvard”) entered into on July 31, 2012, the Company had an obligation to transfer 5,000 shares of the NAVB common stock to Harvard at March 31, 2014 and December 31, 2013. The market value of the 5,000 shares held on March 31, 2014 and December 31, 2013 was $9,250 and $10,350, respectively. The 5,000 shares of NAVB common stock held by the Company at March 31, 2014 and December 31, 2013 is classified as restricted securities in the consolidated balance sheet and the corresponding liability is reported in other current liabilities.

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Consolidated Balance Sheets (Unaudited) (Parenthetical) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	80,000,000	80,000,000
Common stock, shares issued	30,635,720	30,635,720
Common stock, shares outstanding	30,635,720	30,635,720
Series F Preferred Stock [Member]
Convertible redeemable preferred stock, shares par value per share	$ 0.01	$ 0.01
Convertible redeemable preferred stock, shares designated	200,000	200,000
Convertible redeemable preferred stock, shares issued	12,000	12,000
Convertible redeemable preferred stock, shares outstanding	12,000	12,000
Preferred stock, shares liquidation preference	$ 300,000

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Subsequent Events

3 Months Ended

Mar. 31, 2014

Subsequent Events [Abstract]

Subsequent Events

12. Subsequent Events

The Company evaluated all events and transactions that occurred after the balance sheet date through the date of this filing. During this period the Company did not have any material recognizable or disclosable subsequent events.

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Document and Entity Information	3 Months Ended
	Mar. 31, 2014	Apr. 30, 2014
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2014
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q1
Entity Registrant Name	ALSERES PHARMACEUTICALS INC /DE
Entity Central Index Key	0000094784
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		30,635,720

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Nature of Operations and Basis of Presentation (Policies)

3 Months Ended

Mar. 31, 2014

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, these financial statements do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.

The interim unaudited condensed consolidated financial statements contained herein include, in management’s opinion, all adjustments necessary for a fair statement of the financial position, results of operations, and cash flows for the periods presented. The results of operations for the interim period shown on this report are not necessarily indicative of results for a full year. These financial statements should be read in conjunction with the Company’s consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013.

The accompanying condensed consolidated financial statements have been prepared on a basis which assumes that the Company will continue as a going concern which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The uncertainty inherent in the need to raise additional capital and the Company’s recurring losses from operations raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Cash and Cash Equivalents

Cash and Cash Equivalents

Cash equivalents are short-term, highly liquid financial instruments that are readily convertible to cash and have maturities of 90 days or less from the date of purchase. As of March 31, 2014 and December 31, 2013, cash equivalents consisted of money market funds.

Short-term Investments

Short-term Investments

The Company has designated its marketable securities as of each balance sheet date as available-for-sale securities and accounts for them at their respective fair values. Marketable securities are classified as short-term or long-term investments based on the nature of these securities and the availability of these securities to meet current operating requirements. Marketable securities that are readily available for use in current operations are classified as short-term available-for-sale securities and are reported as a component of current assets in the accompanying condensed consolidated balance sheets. The Company reviews all available-for-sale securities at each period end to determine if they remain available-for-sale based on the Company’s then current intent and ability to sell the security if it is required to do so. As of March 31, 2014 and December 31, 2013, the Company’s short-term investments include shares of common stock in Navidea Biopharmaceuticals, Inc. (“Navidea” or “NAVB”) These securities are now classified as freely tradeable short term investments. The unrealized loss associated with these marketable securities has been determined to be temporary and therefore has been included in other comprehensive loss as a component of stockholders’ deficit.

Revenue Recognition

Revenue Recognition

The Company evaluates multiple element revenue arrangements under Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 605-25, Multiple-Element Arrangements. In addition to the form of the arrangement, the substance of the arrangement is also considered in determining whether separate agreements entered into, at or near the same time, that include elements that are interrelated or interdependent should be treated as one multiple-element arrangement. If the Company concludes that separate agreements represent one arrangement, then all the elements in the separate agreements are combined into one multiple-element arrangement for accounting purposes.

Revenues from non-refundable license fees are recognized upon receipt of the payment if the license has stand-alone value, we do not have ongoing involvement or obligations and we have determined the best estimate of the selling price for any undelivered items. When non-refundable license fees do not meet all of these criteria, the license revenues are recognized over the expected period of performance.

We will periodically review our expected period of substantial involvement under the agreements that provide for non-refundable up-front payments and license fees. We will adjust the amortization periods when appropriate to reflect changes in assumptions relating to the duration of our expected involvement. We could accelerate revenue recognition for non-refundable upfront payments or license fees in the event of an early termination of the agreements. Alternatively, we could decelerate such revenue recognition if our period of involvement is extended. While changes to such estimates have no impact on our reported cash flows, our reported revenue is significantly influenced by our estimates of the period over which our obligations are expected to be performed and, therefore, over which revenue will be recognized.

Revenues associated with substantive, at-risk milestones pursuant to our licensing agreements are recognized upon achievement of the milestones. We consider a milestone to be substantive at the inception of the arrangement if it is commensurate with either our performance to achieve the milestone or the enhancement of the value of the delivered item as a result of a specific outcome resulting from our performance to achieve the milestone, it relates solely to past performance and it is reasonable relative to all of the deliverables and payment terms within the arrangement. Non-refundable contingent future amounts receivable in connection with future events specified in our licensing agreements that are not considered milestones will be recognized as revenue when payments are earned by our counterparties through completion of any underlying performance obligations, the amounts are fixed or determinable and collectability is reasonably assured.

Comprehensive Income (Loss)

Comprehensive Income (Loss)

On January 1, 2012, the Company adopted the new presentation requirements under Accounting Standards Update (ASU) 2011-05, “Presentation of Comprehensive Income”. Comprehensive income (loss) consists of net income (loss) and other comprehensive income (loss). Other comprehensive income (loss) includes unrealized gains and losses, net of taxes, on our marketable securities which are also recognized as separate components of equity. ASU 2011-05 requires companies to present the components of net income (loss) and the components of other comprehensive income (loss) either as one continuous statement or as two consecutive statements. In February 2013, the FASB issued ASU 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassifed Out of Accumulated Other Comprehensive Income, which requires an entity to separately present the amount reclassified out of accumulated other comprehensive income (AOCI) for each component of AOCI and to disclose, for each affected line item in the income statement, the amount of AOCI that has been reclassified into that line item. This information must be provided either on the face of the financial statements by income statement line item, or in a footnote. For public companies the amendments in the update became effective for interim or annual periods beginning on or after December 15, 2012. As ASU 2013-02 and ASU 2011-05 impacted

presentation only, netiher had an effect on the Company’s financial position nor results of operations as of and for the three months ended March 31, 2014 and the year ended December 31, 2013, respectively.

Convertible Redeemable Shares

Convertible Redeemable Shares

In accordance with ASC 480, Distinguishing Liabilities from Equity the Company determined that since Series F shares are mandatorily redeemable for cash or for a variable, uncapped, number of common shares, they do not qualify for equity classification.

Income Taxes

Income Taxes

The Company accounts for income taxes under the liability method. Under the liability method, deferred income taxes are determined based on differences between the financial reporting and tax bases of assets and liabilities. They are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company is required to adjust its deferred tax liabilities in the period when tax rates or the provisions of the income tax laws change. Valuation allowances are established to reduce deferred tax assets to the amounts expected to be realized.

Restricted Marketable Securities

Restricted Marketable Securities

Pursuant to the terms of the Amended and Restated License Agreement with Harvard University and its affiliated hospitals (“Harvard”) entered into on July 31, 2012, the Company had an obligation to transfer 5,000 shares of the NAVB common stock to Harvard at March 31, 2014 and December 31, 2013. The market value of the 5,000 shares held on March 31, 2014 and December 31, 2013 was $9,250 and $10,350, respectively. The 5,000 shares of NAVB common stock held by the Company at March 31, 2014 and December 31, 2013 is classified as restricted securities in the consolidated balance sheet and the corresponding liability is reported in other current liabilities.

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Consolidated Statements of Comprehensive Loss (Unaudited) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Income Statement [Abstract]
Revenues	$ 18,432	$ 18,432
Operating expenses:
General and administrative	348,159	439,680
Sublicense and option fees	922
Operating expenses before accrual reversal	349,081	439,680
Accrual reversal		(405,026)
Total operating expenses	349,081	34,654
Loss from operations	(330,649)	(16,222)
Interest expense	(1,365)	(110,867)
Realized loss on sale of marketable securities		(170,766)
Net loss	(332,014)	(297,855)
Unrealized gain (loss) on marketable securities:
Unrealized holding gain (loss) arising during the year	(22,990)	55,492
Less: reclassifications adjustments for loss on sale included in net loss		170,766
Net unrealized gain (loss) on marketable securities	(22,990)	226,258
Comprehensive loss	$ (355,004)	$ (71,597)
Basic and diluted net loss attributable to common stockholders per share	$ (0.01)	$ (0.01)
Weighted average common shares outstanding	30,635,720	30,635,720

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Convertible Preferred Stock

3 Months Ended

Mar. 31, 2014

Text Block [Abstract]

Convertible Preferred Stock

7. Convertible Preferred Stock

The Company’s Series F Convertible, Redeemable Preferred Stock (“Series F Stock”) can be converted into 25 shares of common stock pursuant to the conversion terms of the Series F Stock contained in the Certificate of Designation for the Series F Stock. All shares of Series F Stock were sold to Robert Gipson in 2009 at $25 per share, yielding the Company aggregate proceeds of $4,600,000. As of March 31, 2014, 12,000 shares of Series F Stock were outstanding and held by Robert Gipson.

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Notes Payable and Debt

3 Months Ended

Mar. 31, 2014

Debt Disclosure [Abstract]

Notes Payable and Debt

6. Notes Payable and Debt

Through 2013, a series of working capital loans (“Borrowings”) were made to the Company by its significant stockholder, Mr. Robert Gipson, evidenced by demand promissory notes and totaling $7,135,000 and bearing interest at 7% per annum. Interest on these notes was accrued and totaled approximately $1,365,000 at the execution date. On December 31, 2013, the Company executed a Loan Consolidation Agreement with its significant stockholder (“Lender”). The terms of the Borrowings were modified to reduce the interest to be paid and provide for a fixed due date, additional potential borrowings and a security interest in certain assets of the Company. Upon execution of the Loan Consolidation Agreement, all amounts outstanding under the Borrowings including accrued interest were cancelled and considered paid in full and the Company entered into a new Promissory Note (“Consolidated Note”).

The Consolidated Note bears interest at 3.2% per annum payable semi-annually in arrears and requires principal to be repaid on or before December 31, 2016. The Consolidated Note also includes semi-annual cash draws for the future working capital needs of the Company. The draws will be a minimum of $110,000 and are to be added to principal when drawn. Coincident with the execution of the Loan Consolidation Agreement, the Company and the Lender also executed a Security Agreement which provides the Lender with an undivided security interest in and to all personal and intellectual property of the Company subject to all existing liens, encumbrances and license rights previously granted by the Company. The Security Agreement also allows the Company to be free to dispose of or liquidate the collateral without any prior waiver or authorization from the Lender so long as the proceeds of any such disposition are used to pay down the principal on the Consolidated Note or the Lender affirmatively waives such obligation in writing. The Company considered whether the transaction was within the scope of ASC 470-60-55 Accounting for Troubled Debt Restructuring, which states that if a company is experiencing financial difficulties and a concession is granted, troubled debt restructuring accounting should be applied. The Company concluded that it was experiencing financial difficulties and the creditor had granted a concession as the effective borrowing rate for the restructured debt is less than the effective rate of the old debt prior to restructuring. In 2013 the Company recognized a gain of $682,670 equal to the difference between the carrying value of the old debt and the present value of the future cash flows under the new terms. Since the lender is a related party, the gain was considered in essence to be a capital transaction and therefore, the gain was recognized as an increase to additional paid in capital. Additionally, due to this restructuring, future payments made will be charged to the carrying value of the restructured debt balance and no interest expense will be recorded going forward.

During the three months ended March 31, 2014, the Company borrowed an additional $365,000 under the Consolidated Note. Interest expense of $1,115 was recognized for the 3 month period ended March 31, 2014. The accrued interest balance at March 31, 2014 represents the accrued interest of $1,115 associated with the additional borrowings and the current portion of the restructured debt balance, which is interest only.

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Summary of Significant Accounting Policies - Additional Information (Detail) (USD $)	3 Months Ended	12 Months Ended
	Mar. 31, 2014	Dec. 31, 2013
Accounting Policies [Abstract]
Period of maturity on conversion of cash equivalents	90 days
Number of shares obligation transferred	5,000	5,000
Market value of the shares	$ 9,250	$ 10,350

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Accounts Payable and Accrued Expenses (Tables)

3 Months Ended

Mar. 31, 2014

Payables And Accruals [Abstract]

Summary of Accounts Payable and Accrued Expenses

The Company’s accounts payable and accrued expenses consisted of the following:

	March 31, 2014		December 31, 2013
Research and development expenses	$	430,824	$	470,824
Professional fees		157,942		201,146
General and administrative expenses		374,701		307,883
Compensation related expenses		77,650		75,885
	$	1,041,117	$	1,055,738

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Fair Value Measurements

3 Months Ended

Mar. 31, 2014

Fair Value Disclosures [Abstract]

Fair Value Measurements

10. Fair Value Measurements

The fair value hierarchy prioritizes observable and unobservable inputs used to measure fair value into three broad levels:

Level 1 — unadjusted quoted prices in active markets for identical securities;

Level 2 — unadjusted quoted prices in markets that are not active,

Level 3 — significant unobservable inputs, including our own assumptions in determining fair value

The following table summarizes the financial assets that we measured at fair value as of March 31, 2013 and December 31, 2012.

	March 31, 2014
	Level 1		Level 2		Level 3		Total
Available for sale securities	$	175,660	$	—	$	—	$	175,660

	December 31, 2013
	Level 1		Level 2		Level 3		Total
Available for sale securities	$	196,650	$	—	$	—	$	196,650

As of March 31, 2014 and December 31, 2013, the Company’s Level 1 short-term investments consist of 95,000 shares of Navidea common stock which are traded on the NYSE under the symbol NAVB.

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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

We recognize and disclose commitments when we enter into executed contractual obligations with third parties. We accrue contingent liabilities when it is probable that future expenditures will be made and such expenditures can be reasonably estimated.

On March 13, 2012 the Company received notice that Children’s Hospital Boston and Children’s Medical Center Corporation had filed a lawsuit in Middlesex Superior Court, Middlesex County, Massachusetts seeking to recover amounts alleged to be owed by the Company to the plaintiffs.

On February 1, 2013 the Company entered into a Settlement Agreement and Release with Boston Children’s Hospital (BCH) and Children’s Medical Center Corporation (CMCC) in full settlement of the lawsuit filed by BCH and CMCC seeking to recover amounts alleged to be owed by the Company to the plaintiffs totaling $642,906 plus costs.

In settlement of all claims by BCH and CMCC, the Company agreed to pay a lump sum of $185,000 to the plaintiffs. In addition to the lump sum payment, the Company agreed to pay to the plaintiffs an additional sum equal to the then cash value of 20,000 shares of the common stock of Navidea upon the occurrence of the first milestone described in Section 4.2 of the sublicense agreement dated as of July 31, 2012 between Navidea and the Company. The milestone occurred in December, 2013 at which time the value of 20,000 shares of Navidea common stock was $40,000. The Company paid CMCC the sum of $40,000 in January 2014 in accordance with the terms of the Settlement Agreement and Release.

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Income taxes

3 Months Ended

Mar. 31, 2014

Income Tax Disclosure [Abstract]

Income taxes

9. Income taxes

The Company is subject to both federal and state income tax for the jurisdiction within which it operates. Within these jurisdictions, the Company is open to examination for tax years ended December 31, 2010 through December 31, 2013. The U.S. Internal Revenue Service (IRS) has completed an audit of tax years 2007 and 2008 and has informed us that no adjustments to the federal tax returns as filed will be proposed as a result of the audit. However, because we are carrying forward income tax attributes such as a net operating loss (“NOL”) from 2006, these attributes can still be audited when utilized on returns filed in the future.

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Related Party Transaction

3 Months Ended

Mar. 31, 2014

Related Party Transactions [Abstract]

Related Party Transaction

11. Related Party Transaction. During the first three months of 2014, Robert Gipson provided a total of $365,000 to the Company as an increase to the Consolidate Note referenced in Note 6 above.

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Fair Value Measurements - Summary of Financial Assets Measured at Fair Value (Detail) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	$ 175,660	$ 196,650
Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	175,660	196,650
Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities
Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities

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Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2014

Fair Value Disclosures [Abstract]

Summary of Financial Assets Measured at Fair Value

The following table summarizes the financial assets that we measured at fair value as of March 31, 2013 and December 31, 2012.

	March 31, 2014
	Level 1		Level 2		Level 3		Total
Available for sale securities	$	175,660	$	—	$	—	$	175,660

	December 31, 2013
	Level 1		Level 2		Level 3		Total
Available for sale securities	$	196,650	$	—	$	—	$	196,650

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Net Loss per Share - Additional Information (Detail) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Earnings Per Share [Abstract]
Number of anti-dilutive securities excluded from computation of diluted net loss per common share	0.9	3.0

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Consolidated Statements of Cash Flows (Unaudited) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Cash flows from operating activities:
Net loss	$ (332,014)	$ (297,855)
Adjustments to reconcile net loss to net cash used for operating activities:
Amortization and depreciation		1,186
Loss on sales of marketable securities		170,766
Changes in operating assets and liabilities:
(Increase) decrease in prepaid expenses and other current assets	(22,423)	14,248
(Increase) decrease in deferred charges	922	922
Increase (decrease) in accounts payable and accrued expenses	(14,621)	(621,949)
Increase in accrued interest payable	1,115	110,639
Increase (decrease) in deferred revenue	(18,429)	(18,432)
Increase in current liabilities		(60,126)
Net cash used for operating activities	(385,450)	(700,601)
Cash flows from investing activities:
Sales and maturities of marketable securities		726,934
Net cash provided by investing activities		726,934
Cash flows from financing activities:
Advances from related party		50,000
Proceeds from issuance of promissory notes	365,000
Net cash provided by financing activities	365,000	50,000
Net (decrease) increase in cash and cash equivalents	(20,450)	76,333
Cash and cash equivalents, beginning of period	113,958	16,528
Cash and cash equivalents, end of period	93,508	92,861
Supplemental cash flow disclosures:
Net change in unrealized holding gains and losses	(20,990)
Accretion of Series F Preferred Stock	(5,294)
Accrued interest recognized upon troubled debt restructuring currently due	$ (56,298)

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Accounting for Stock-Based Compensation

3 Months Ended

Mar. 31, 2014

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Accounting for Stock-Based Compensation

5. Accounting for Stock-Based Compensation

We have one stock option plan under which we can issue both nonqualified and incentive stock options to employees, officers, consultants and scientific advisors of the Company. At March 31, 2014, the 2005 Stock Incentive Plan (the “2005 Plan”) provided for the issuance of options, restricted stock, restricted stock units, stock appreciation rights or other stock-based awards to purchase 3,450,000 shares of our common stock. The 2005 Plan contains a provision that allows for an annual increase in the number of shares available for issuance under the 2005 Plan on the first day of each of the Company’s fiscal years during the period beginning in fiscal year 2006 and ending on the second day of fiscal year 2014. The annual increase in the number of shares shall be equal to the lowest of 400,000 shares; 4% of the Company’s outstanding shares on the first day of the fiscal year; and an amount determined by the Board of Directors. No increase in the number of shares available for issuance was made in January 2014.

We also have outstanding stock options in three other stock option plans, the 1998 Omnibus Plan, the Amended and Restated Omnibus Stock Option Plan and the Amended and Restated 1990 Non-Employee Directors’ Non-Qualified Stock Option Plan. These plans have expired and no future issuance of awards is permissible.

Our Board of Directors determines the term, vesting provisions, price, and number of shares for each award that is granted. The term of each option cannot exceed ten years.

We use the Black-Scholes option-pricing model to calculate the fair value of each option grant on the date of grant. No stock options were granted during the three months ended March 31, 2014 and 2013.

A summary of our outstanding stock options for the three months ended March 31, 2014 and 2013 is presented below.

	2014					2013
	Shares			Weighted Average Exercise Price		Shares		Weighted Average Exercise Price
Outstanding at beginning of period		3,002,480		$	1.51		3,010,980	$	1.51
Granted		—			—		—		—
Exercised		—			—		—		—
Forfeited and expired		(2,147,500	)	$	1.17		—		—
Outstanding at end of period		854,980		$	2.31		3,010,980	$	1.51
Options exercisable at end of period		854,980		$	2.31		3010,980	$	1.51

The following table summarizes information about stock options outstanding and exercisable at March 31, 2014:

Range of Exercise Prices	Number Outstanding		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price
$1.15 — $1.36		150,000		4.8 years	$	1.15
$2.00 — $3.00		539,980		1.5 years		2.33
$3.10 — $4.65		155,000		3.6 years		3.17
$4.99 — $6.96		10,000		.2 years		5.00
		854,980		2.4 years	$	2.31

There was no intrinsic value of outstanding options and exercisable options as of March 31, 2014. As of March 31, 2014, 2,946,672 shares were available for grant under the 2005 Stock Incentive Plan.

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Accounting for Stock-Based Compensation - Additional Information (Detail) (USD $)	3 Months Ended		1 Months Ended	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Jan. 31, 2013 2005 Stock Incentive Plan [Member]	Mar. 31, 2014 2005 Stock Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Purchase of company common stock				3,450,000
Annual increase in number of shares				400,000
Annual increase in number of shares percentage				4.00%
Share-based compensation arrangement by share-based payment award, other share increase (decrease)			0
Term of option	10 years
Stock options granted
Intrinsic value of outstanding options	$ 0
Intrinsic value of exercisable options	$ 0
Shares available for grant				2,946,672

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Accounting for Stock-Based Compensation (Tables)

3 Months Ended

Mar. 31, 2014

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Summary of Outstanding Stock Options

A summary of our outstanding stock options for the three months ended March 31, 2014 and 2013 is presented below.

	2014					2013
	Shares			Weighted Average Exercise Price		Shares		Weighted Average Exercise Price
Outstanding at beginning of period		3,002,480		$	1.51		3,010,980	$	1.51
Granted		—			—		—		—
Exercised		—			—		—		—
Forfeited and expired		(2,147,500	)	$	1.17		—		—
Outstanding at end of period		854,980		$	2.31		3,010,980	$	1.51
Options exercisable at end of period		854,980		$	2.31		3010,980	$	1.51

Summary of Stock Options Outstanding and Exercisable

The following table summarizes information about stock options outstanding and exercisable at March 31, 2014:

Range of Exercise Prices	Number Outstanding		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price
$1.15 — $1.36		150,000		4.8 years	$	1.15
$2.00 — $3.00		539,980		1.5 years		2.33
$3.10 — $4.65		155,000		3.6 years		3.17
$4.99 — $6.96		10,000		.2 years		5.00
		854,980		2.4 years	$	2.31