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12444646
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31382953
75702960
31066611
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31390174
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12444646
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316342
3142863
12444646
12444
103227832
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14571055
2513074
171000
37045781
12406
12406406
5000000
37037563
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37045781
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2342074
12406406
12406
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1146024
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6001496
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31066611
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1087876
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1166989
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1573000
266279
1573000
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782376
3425000
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Q1
VTUS
VENTRUS BIOSCIENCES INC
false
Accelerated Filer
2012
10-Q
2012-03-31
0001426800
--12-31
714355
<div style="FONT: 10pt Times New Roman, Times, Serif">
<p style="MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif"><b>Note
4 — Stockholders’ Transactions:</b></p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<b> </b></p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<b>Common Stock Transactions:</b></p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
On January 31, 2012, the Company filed a shelf registration
statement with the Securities and Exchange Commission under which
it may offer shares of its common stock and preferred stock,
various series of debt securities and/or warrants to purchase any
of such securities, either individually or in units, in one or more
offerings, up to a total dollar amount of $100,000,000. The
registration statement became effective as of February 10, 2012. As
part of the shelf registration statement, the Company included a
prospectus for a possible at-the-market common equity sales program
for the sale of up to $20,000,000 of common stock. As of March 31,
2012, no securities have been offered or sold pursuant to the shelf
registration statement.</p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<b>Common Stock Options and Warrants:</b></p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
In connection with the Company’s financings in 2007, 2008,
2009 and 2010, the Company issued warrants to investors and/or
placement agents to purchase shares of common stock as well as
certain consulting warrants.</p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: center; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
A summary of the Company’s warrant activity and related
information is as follows:</p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<table style="WIDTH: 50%; FONT: 10pt Times New Roman, Times, Serif" cellspacing="0" cellpadding="0">
<tr style="VERTICAL-ALIGN: bottom">
<td> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="TEXT-ALIGN: center; PADDING-BOTTOM: 1pt" colspan="6" nowrap="nowrap">Period  Ended</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
</tr>
<tr style="VERTICAL-ALIGN: bottom">
<td nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">March  31, 2012</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
</tr>
<tr style="VERTICAL-ALIGN: bottom">
<td nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: center" colspan="2" nowrap="nowrap">
 </td>
<td nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: center" colspan="2" nowrap="nowrap">
Weighted Average</td>
<td nowrap="nowrap"> </td>
</tr>
<tr style="VERTICAL-ALIGN: bottom">
<td nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Shares</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Exercise Price</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="WIDTH: 74%">
Outstanding at beginning of period</td>
<td style="WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: right; WIDTH: 10%">956,443</td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
<td style="WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: left; WIDTH: 1%">$</td>
<td style="TEXT-ALIGN: right; WIDTH: 10%">7.61</td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td>Granted</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">-</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left">$</td>
<td style="TEXT-ALIGN: right">-</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt">Exercised</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
-</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
-</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 2.5pt">Outstanding at end of period</td>
<td style="PADDING-BOTTOM: 2.5pt"> </td>
<td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right">
956,443</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 2.5pt"> </td>
<td style="PADDING-BOTTOM: 2.5pt"> </td>
<td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left">
$</td>
<td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right">
7.61</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 2.5pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left">Warrants exercisable at end of
period</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">956,443</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left">$</td>
<td style="TEXT-ALIGN: right">7.61</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
</table>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
All outstanding warrants have vested and no additional expense is
expected to be recorded in the future years.</p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
In August 2010, the Company’s stockholders approved the 2010
Equity Incentive Plan (the “2010 Plan”). In May 2011,
the Company’s stockholders approved an amendment to the 2010
Plan to increase the shares reserved for issuance from 2,467,200 to
3,967,200 shares of the Company’s common stock. The 2010 Plan
authorizes the Company to issue equity incentive awards in the form
of shares, options or other awards based on Ventrus common stock as
part of an overall compensation package to provide
performance-based compensation to attract and retain qualified
personnel.</p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
In November 2010, the Company granted options to non-employee
directors to purchase an aggregate of 160,000 shares under the 2010
Plan. In addition, under Dr. Ellison’s and Mr.
Barrett’s respective employment agreements, the Company
granted to Dr. Ellison and Mr. Barrett options under the 2010 plan
to purchase 573,599 shares and 305,920 shares, respectively, at a
price of $6.00 per share.</p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
In January 2012, the Company granted options to purchase 35,000
shares to one of its directors and 168,000 options to purchase
shares to seven employees. Additionally, the company granted
options to purchase an aggregate of 127,740 shares to seven
consultants all pursuant to the 2010 Plan. The exercise prices of
the options granted were at the then market value of the
Company’s common stock ($8.10 - $10.62 per share).</p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: center; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
A summary of the Company’s option activity and related
information is as follows:</p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<table style="WIDTH: 70%; FONT: 10pt Times New Roman, Times, Serif" cellspacing="0" cellpadding="0">
<tr style="VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">Period Ended<br />
March 31, 2012</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: center; PADDING-BOTTOM: 1pt" colspan="2" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
</tr>
<tr style="VERTICAL-ALIGN: bottom">
<td nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Shares</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Weighted<br />
Average<br />
Exercise<br />
Price</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Aggregate<br />
Intrinsic Value</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="WIDTH: 61%">Outstanding at beginning of period</td>
<td style="WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: right; WIDTH: 10%">2,046,455</td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
<td style="WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: left; WIDTH: 1%">$</td>
<td style="TEXT-ALIGN: right; WIDTH: 10%">6.40</td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
<td style="WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: left; WIDTH: 1%">$</td>
<td style="TEXT-ALIGN: right; WIDTH: 10%">-</td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td>Granted</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">330,740</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left">$</td>
<td style="TEXT-ALIGN: right">8.44</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left">$</td>
<td style="TEXT-ALIGN: right">-</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td>Exercised</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">38,240</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left">$</td>
<td style="TEXT-ALIGN: right">6.24</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left">$</td>
<td style="TEXT-ALIGN: right">173,227</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 2.5pt">Outstanding at end of period</td>
<td style="PADDING-BOTTOM: 2.5pt"> </td>
<td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right">
2,338,955</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 2.5pt"> </td>
<td style="PADDING-BOTTOM: 2.5pt"> </td>
<td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left">
$</td>
<td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right">
6.69</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 2.5pt"> </td>
<td style="PADDING-BOTTOM: 2.5pt"> </td>
<td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left">
$</td>
<td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right">
7,817,824</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 2.5pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 2.5pt">Options
exercisable at end of period</td>
<td style="PADDING-BOTTOM: 2.5pt"> </td>
<td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right">
1,715,715</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 2.5pt"> </td>
<td style="PADDING-BOTTOM: 2.5pt"> </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 2.5pt"> </td>
<td style="TEXT-ALIGN: right; PADDING-BOTTOM: 2.5pt"> </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 2.5pt"> </td>
<td style="PADDING-BOTTOM: 2.5pt"> </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 2.5pt"> </td>
<td style="TEXT-ALIGN: right; PADDING-BOTTOM: 2.5pt"> </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 2.5pt"> </td>
</tr>
</table>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
The Company expects that all outstanding unvested options will
vest. The fair value of the options granted for the three month
periods ended March 31, 2012, was based on the following
assumptions, respectively:</p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<table style="WIDTH: 65%; FONT: 10pt Times New Roman, Times, Serif" cellspacing="0" cellpadding="0">
<tr style="VERTICAL-ALIGN: bottom">
<td> </td>
<td style="PADDING-BOTTOM: 1pt; FONT-WEIGHT: bold"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center; FONT-WEIGHT: bold" colspan="2">2012</td>
<td style="PADDING-BOTTOM: 1pt; FONT-WEIGHT: bold"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left">Risk-free interest rate</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right" nowrap="nowrap">1.31% -
1.44 </td>
<td style="TEXT-ALIGN: left">% </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; WIDTH: 87%">Expected volatility</td>
<td style="WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: right; WIDTH: 10%">76.37</td>
<td style="TEXT-ALIGN: left; WIDTH: 1%">%</td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left">Expected life of options</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">7 years</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left">Expected dividend yield</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0</td>
<td style="TEXT-ALIGN: left">%</td>
</tr>
</table>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Estimated future stock-based compensation expense relating to
unvested stock options (for non-employees, based on the fair value
at March 31, 2012) is as follows:</p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<table style="WIDTH: 70%; FONT: 10pt Times New Roman, Times, Serif" cellspacing="0" cellpadding="0">
<tr style="VERTICAL-ALIGN: bottom">
<td style="BORDER-BOTTOM: black 1pt solid; FONT-WEIGHT: bold">
Calendar Years Ending December 31,</td>
<td style="PADDING-BOTTOM: 1pt; FONT-WEIGHT: bold"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center; FONT-WEIGHT: bold" colspan="2" nowrap="nowrap">Future Stock Option<br />
Compensation<br />
Expense</td>
<td style="PADDING-BOTTOM: 1pt; FONT-WEIGHT: bold"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; WIDTH: 87%">2012</td>
<td style="WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: left; WIDTH: 1%">$</td>
<td style="TEXT-ALIGN: right; WIDTH: 10%">2,504,223</td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left">2013</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">1,576,231</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt">2014</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
651,674</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 2.5pt">Total estimated
future stock-based<br />
compensation expense – stock options</td>
<td style="PADDING-BOTTOM: 2.5pt"> </td>
<td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: left">
$</td>
<td style="BORDER-BOTTOM: black 2.5pt double; TEXT-ALIGN: right">
4,732,128</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 2.5pt"> </td>
</tr>
</table>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
The weighted average remaining contractual life of options
outstanding at March 31, 2012 is approximately 8.5 years and the
cost is expected to be recognized over a weighted-average period of
1.61 years.</p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Stock-based compensation expensed to research and development
expense for the three months ended March 31, 2012 and 2011 was
$258,494, and $154,457, respectively. Stock-based compensation
expensed to general and administrative expense for the three months
ended March 31, 2012 and 2011 was $681,374 and $998,329,
respectively.</p>
</div>
225513
196324
16181
57889
<div style="FONT: 10pt Times New Roman, Times, Serif">
<p style="MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif"><b>Note
3 — Commitments:</b></p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<b> </b></p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<b>Employment agreements:</b></p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
The Company has employment agreements with the Chief Executive
Officer (“CEO”), Chief Financial Officer
(“CFO”) and Chief Business Officer (“CBO”)
which provide for aggregate base salaries of $875,000 per year, a
guaranteed bonus of $75,000 per year for the CEO and annual
performance-based bonuses of up to 50%, 25% and 20%, respectively,
of their base salaries. The agreements for the CEO and CFO
also provide incentive bonuses of $250,000 and $500,000 for each in
the event that the Company’s market capitalization exceeds
specified levels. The first threshold was met and each of the
$250,000 bonuses were paid in the third quarter of 2011. </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
In 2011, the agreements with the CEO and CFO were amended to
provide that if the second market capitalization threshold is
attained, the bonus of $500,000 will be paid in a combination of
shares of the Company’s common stock worth $300,000 and
$200,000 in cash. The number of the shares of common stock
each was determined by the closing price of the Company’s
common stock as reported on NASDAQ on August 24, 2011 ($9.85),
which results in 30,457 shares to be issued to each of Dr.
Ellison and Mr. Barrett if the second market capitalization
threshold is attained. As of March 31, 2012, the second market
capitalization threshold has not been attained.</p>
</div>
238617
-6089551
714355
997
1339784
238617
-8173876
6422726
<div style="FONT: 10pt Times New Roman, Times, Serif">
<p style="MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif"><b>Note
2 — Summary of Significant Accounting
Policies:</b></p>
<p style="MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
<b> </b></p>
<p style="MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
<b>Cash and Cash Equivalents:</b></p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
All highly liquid investments with maturities of three months or
less at the time of purchase are considered to be cash
equivalents. All of the Company’s cash equivalents have
liquid markets and high credit ratings. The Company maintains
its cash in bank deposit and other accounts, the balances of which,
at times and at March 31, 2012, exceed federally insured
limits.</p>
<p style="MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
<b> </b></p>
<p style="TEXT-ALIGN: center; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<b> </b></p>
<p style="MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
<b>Use of estimates:</b></p>
<p style="MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of
America requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and reported amounts of revenue and expenses
during the reporting period. Actual results could differ from those
estimates.</p>
<p style="MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
  </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Significant estimates inherent in the preparation of the
accompanying financial statements include the fair value of stock
options and warrants granted to employees, consultants, directors,
investors, licensors, placement agents and underwriters.</p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Additionally, the Company provides a valuation allowance for
deferred income tax assets when it is considered more likely than
not that all or a portion of such deferred income tax assets will
not be realized.</p>
<p style="MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
<b> </b></p>
<p style="MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
<b>Stock-based compensation:</b></p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
The Company’s share-based compensation cost is measured at
grant date, using the Black-Scholes option pricing model to
estimate the fair value of the award, and is recognized as expense
over the employee’s or director’s requisite service
period on a straight-line basis. The Company accounts for
stock options and warrants granted to non-employees on a fair value
basis which is estimated using the Black-Scholes option pricing
model. The initial non-cash charge to operations for
non-employee options and warrants with vesting are revalued at the
end of each reporting period until vested and recognized as
consulting expense over the related vesting period.</p>
<p style="MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
<b> </b></p>
<p style="MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
<b>Research and development:</b></p>
<p style="MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Research and development expenses include personnel and
facility-related expenses, third party contracted services
including clinical trial costs, manufacturing and process
development costs, research costs and other consulting services.
Research and development costs are expensed as incurred. In
instances where the Company enters into agreements with third
parties for clinical trials, manufacturing and process development,
research and other consulting activities, costs are expensed as
services are performed. Amounts due under such arrangements may be
either fixed fee or fee for service, and may include upfront
payments, monthly payments, and payments upon the completion of
milestones or receipt of deliverables.</p>
<p style="MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
  </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
The Company’s accruals for clinical trials are based on
estimates of the services received and pursuant to contracts with
the respective clinical trial centers and clinical research
organizations. In the normal course of business, the Company
contracts with third parties to perform various clinical trial
activities in the ongoing development of potential
products. The financial terms of these agreements are subject
to negotiation and variation from contract to contract and may
result in uneven payment flows. Payments under the contracts
depend on factors such as the achievement of certain events, the
successful enrollment of patients, and the completion of portions
of the clinical trial or similar conditions. The objective of
the Company’s accrual policy is to match the recording of
expenses in its financial statements to the actual services
received. As such, expense accruals related to clinical trials
are recognized based on the estimate of the degree of completion of
the event or events specified in the specific clinical study or
trial contract.</p>
<p style="MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
<b> </b></p>
<p style="MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
<b>Income taxes:</b></p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
The Company’s income tax expense consists of current and
deferred income tax expense or benefit. Current income tax expense
or benefit is the amount of income taxes expected to be payable or
refundable for the current year. Deferred tax assets and
liabilities are recognized for the future tax consequences
attributable to temporary differences between the financial
statement carrying amounts of existing assets and liabilities and
their respective tax bases. Deferred tax assets and
liabilities are measured using enacted tax rates expected to apply
to taxable income in the years in which those temporary differences
are expected to be recovered or settled. The effect on
deferred tax assets and liabilities of a change in tax rates is
recognized in income in the period that includes the enactment
date. Valuation allowances are established when it is more
likely than not that some or all of the deferred tax assets will
not be realized.</p>
<p style="MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
<b> </b></p>
<p style="TEXT-ALIGN: center; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<b> </b></p>
<p style="MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
<b>Loss per common share:</b></p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Basic net loss per common share excludes dilution and is computed
by dividing net loss by the weighted average number of common
shares outstanding during the period. Diluted net loss per
common share reflects the potential dilution that could occur if
securities or other contracts to issue common stock were exercised
or converted into common stock or resulted in the issuance of
common stock that then shared in the earnings of the entity unless
inclusion of such shares would be anti-dilutive. Since the
Company has only incurred losses, basic and diluted net loss per
share is the same. The number of potentially dilutive
securities (options, warrants and convertible instruments) excluded
from the diluted loss per share calculation for the three-month
periods ended March 31, 2012 and 2011 was 3,169,688 and 2,782,412
respectively.</p>
</div>
-8190057
<div style="FONT: 10pt Times New Roman, Times, Serif">
<p style="MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif"><b>Note
1 — Organization, Business and Basis of
Presentation:</b></p>
<p style="MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
<b> </b></p>
<p style="MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
<b>Organization and business:</b></p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Ventrus BioSciences Inc. (“Ventrus” or the
“Company”) is a specialty pharmaceutical company
focused on the late-stage development and commercialization of
gastrointestinal products. Ventrus was incorporated in the State of
Delaware on October 7, 2005 and commenced operations in April
2007.</p>
<p style="MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
<b> </b></p>
<p style="MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
<b>Basis of presentation:</b></p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
The accompanying condensed balance sheet as of December 31, 2011,
which has been derived from the Company’s <font style="COLOR: black">audited financial statements, and the unaudited
interim condensed financial statements have been prepared in
accordance with U.S. generally accepted accounting principles and
the rules and regulations of the Securities and Exchange Commission
(“SEC”) related to a quarterly report on Form 10-Q.
Certain information and note disclosures normally included in
annual financial statements prepared in accordance with accounting
principles generally accepted in the United States have been
condensed or omitted pursuant to those rules and regulations,
although the Company believes that the disclosures made are
adequate to make the information presented not misleading. The
unaudited interim condensed financial statements reflect all
adjustments which, in the opinion of management, are necessary for
a fair presentation of the results for the periods presented. All
such adjustments are of a normal and recurring nature. These
unaudited condensed financial statements</font> <font style="COLOR: black">should be read in conjunction with the financial
statements and the notes thereto included in the Company’s
Annual Report on Form 10-K for the year ended December 31,
2011. The operating results presented in these unaudited condensed
financial statements are not necessarily indicative of the results
that may be expected for any future periods.</font></p>
<p style="MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
<b> </b></p>
<p style="MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
<b>Capital Resources:</b></p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
The Company has not derived any revenue from product sales to date
as its products have not been approved for sale by the U.S. Food
and Drug Administration (“FDA”) or any foreign
regulatory agency. Since inception, the Company’s
operations have been financed primarily through the sale of equity
securities, the proceeds from the exercise of warrants and stock
options and issuance of debt. The Company has incurred losses
from operations and negative cash flows since inception and expects
to continue to incur substantial losses for the foreseeable future
as it continues product development. As a result, the Company
may need to obtain additional funds to finance its operations in
the future. In July 2011, the Company raised net proceeds of
approximately $47,600,000 in a secondary offering of its equity
securities. Until the Company can generate significant cash from
its operations, it intends to obtain any additional funding it
requires through strategic relationships, public or private equity
or debt financings, or other arrangements and it cannot assure such
funding will be available on reasonable terms, or at all. The
Company currently has sufficient funds to meet its operating
requirements and scheduled regulatory and development activities
through the third quarter of 2013.</p>
</div>
-5908823
1767331
180728
-0.66
12408927
<div style="FONT: 10pt Times New Roman, Times, Serif">
<p style="TEXT-ALIGN: left; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<b>Note 5 — License Agreements:</b></p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
In March 2007, pursuant to an Exclusive License Agreement, S.L.A.
Pharma, AG (“S.L.A. Pharma”) granted Paramount
BioSciences, LLC, or PBS, a royalty-bearing license to sell, make
and use diltiazem for treatment, through topical administration, of
anal fissures and phenylepherine for treatment, through topical
administration, of fecal incontinence in the United States, Canada
and Mexico. In August 2007, pursuant to an Assignment and
Assumption Agreement, PBS sold all of its rights in and arising out
of the Exclusive License Agreement with S.L.A. Pharma to Ventrus
for $1,087,876. The corresponding U.S. and foreign patents and
applications for the two compounds have been licensed to Ventrus
under the Assignment and Assumption Agreement (the technology
referred to collectively as the “Compound Technology”).
In the event that the Compound Technology is commercialized, the
Company is obligated to pay to S.L.A. Pharma annual royalties,
based upon net sales of the product. In addition, the Company is
required to make payments to S.L.A. Pharma up to an aggregate
amount of $20 million upon the achievement of various milestones
related to regulatory events. Should the Company make any
improvements regarding the Compound Technology, the Company is
required to grant S.L.A. Pharma licenses to use such
improvements.</p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
As compensation for S.L.A. Pharma’s participation in the
management and the development of the technologies, Ventrus is
required to make separate payments to S.L.A. Pharma equal to
$41,500 per month (“Monthly Payments”) for each of
diltiazem and phenylephrine. Per the agreement, Ventrus’
obligation to make these monthly payments was to terminate upon a
new drug application (“NDA”) filing. Pursuant to
amendments to the Exclusive License Agreement, the Company, as of
September 30, 2010, was no longer required to make additional
payments for phenylephrine. At March 31, 2012, the Company had no
amounts due to S.L.A. Pharma.</p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Ventrus is also required to reimburse S.L.A. Pharma for clinical
development costs associated with the technology development of
both diltiazem and phenylephrine. Ventrus’ total payment
obligation for the diltiazem project was limited
to $4,200,000. and these payments were made from August 2007
through December 31, 2011. Both Ventrus and S.L.A. Pharma have
agreed to add additional services outside the scope of the
agreement for $400,000. The services have not yet been provided by
S.L.A. Pharma. S.L.A. Pharma has been paid $600,000 for services
for the phenylephrine project through March 31, 2012. S.L.A.
Pharma did not provide Ventrus with any services for the
phenylephrine project in 2011 or 2012, and management does not
expect any services from SLA Pharma for the phenylephrine project
in the foreseeable future.</p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
On June 6, 2011, Ventrus further amended the Exclusive License
Agreement with S.L.A. Pharma. The amendment eliminates its
potential $800,000 milestone payment to S.L.A. Pharma for the
development of diltiazem, previously payable upon the completion of
enrollment into the Phase III clinical trial that S.L.A. Pharma is
conducting in Europe. It also eliminates S.L.A. Pharma’s
ability to terminate the license agreement at any time, with one
month’s notice, in the event that Ventrus had failed to make
a required payment and a third party wished to enter into a license
agreement for diltiazem and phenylephrine, provided the termination
would not have been effective if within that one-month period
Ventrus paid all the then required payments under the agreement.
Pursuant to the amendment, Ventrus must pay S.L.A. Pharma up to
$1,000,000 in milestone payments, payable in four equal
installments of $250,000 once specified thresholds of randomized
patients are achieved in the Phase III trial for diltiazem that
S.L.A. Pharma is conducting in Europe. The first two milestones
were met and paid in the third quarter of 2011 and the third and
fourth milestone was met and paid in the fourth quarter of 2011. As
of March 31, 2012, Ventrus’ total remaining payment
obligation for the phenylephrine project shall not exceed $400,000,
consisting of to-be-agreed-upon services. Additionally, upon
Ventrus’ receipt of a quality controlled final study report
of the Phase III trial for diltiazem in Europe, Ventrus must pay
S.L.A. Pharma $400,000 in development costs for diltiazem.</p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
In March 2008, Ventrus entered into an exclusive worldwide license
agreement with Sam Amer & Co., Inc., a California company
(“Amer”), whereby Ventrus acquired certain patent
rights to iferanserin for the topical treatment of any anorectal
disorders. Under the terms of the license agreement, Ventrus was
obligated to make monthly contractual payments and may be required
to make future milestone and royalty payments totaling up to $20
million upon the achievement of various milestones related to
regulatory or commercial events. Through November 14, 2011, the
Company had made all monthly contractual payments relating to the
license agreement but still could be required to make future
milestone and royalty payments.</p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: center; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
</p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
On June 5, 2011, the Company entered into an agreement with Amer to
acquire all rights, title and interest to iferanserin. Ventrus paid
$500,000 on execution of the agreement. On November 14, 2011, the
Company closed the acquisition and paid Amer an additional $12
million which was expensed as research and development expense.
Ventrus will pay Amer royalties of between 3.0% and 4.0% on net
annual sales in the U.S. and between 1.0% and 1.33% on gross annual
sales outside the U.S., subject to a minimum annual royalty payment
on both U.S. and ex-U.S. sales equal to (i) the royalty that would
have been due had U.S. Net Sales (as defined in the Amer Purchase
Agreement) equaled 50% of the U.S. Net Sales contained in the sales
forecast to be provided by the Company to Amer for the applicable
year and (ii) the royalty that would have been due had ex-U.S.
Gross Sales (as defined in the Amer Purchase Agreement) equaled 50%
of the ex-U.S. Gross Sales contained in the sales forecast to be
provided by the Company to Amer for the applicable year.</p>
</div>
38240
38
714355
225513
238579
-8173876
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