Quarterly report pursuant to Section 13 or 15(d)

Abeona Therapeutics LLC Acquisition

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Abeona Therapeutics LLC Acquisition
 9 Months Ended
Sep. 30, 2015
Abeona Therapeutics LLC Acquisition [Abstract]  
Abeona Therapeutics LLC Acquisition
(5)
Abeona Therapeutics LLC Acquisition

On May 15, 2015, we agreed to issue an aggregate of 3,979,761 unregistered shares of our common stock to the members of Abeona Therapeutics LLC (Abeona Ohio). Abeona Ohio’s principal activities were focused on developing and delivering gene therapy products for severe and life-threatening rare diseases. Abeona Ohio's lead program is ABO-101 (AA9 NAGLU) and ABO-102 (scAAV9 SGHG), adeno-associated virus (AAV)-based gene therapies for Sanfilippo syndrome (MPS IIIA and IIIB) in collaboration with patient advocate groups, researchers and clinicians, anticipated to commence clinical trials in 2015.

The initial consideration of $31,758,000 was calculated using the Company’s stock price on date of the closing, May 15, 2015 of $7.98 times the number of the Company shares (3,979,761) issued to Abeona Ohio members.

There is a contingent valuation on three milestones. Per the merger agreement with Abeona Ohio each milestone would consist of either cash, our stock or a combination of both, at the Company’s election, equivalent to a stated dollar amount. The fair value of the probability of achieving all three milestones is estimated at $6,489,000.

The following preliminary purchase price allocation is based on information we have to date and is unaudited.
 
Total purchase price
    
Initial consideration
  
$
31,758,000
  
Contingent consideration
    
6,489,000
  
Total purchase price
  
$
38,247,000
  
         
Allocation of the purchase price
        
Cash
  
$
3,697,000
  
Accounts receivable
    
1,000
  
Prepaid expenses
    
28,000
  
Property and equipment
    
51,000
  
Other assets
    
1,000
  
Accounts payable
    
(153,000
)
Total tangible assets
    
3,625,000
  
         
Licensing agreement
    
2,156,000
  
Goodwill
    
38,955,000
  
Contingent consideration liability
    
(6,489,000
)
         
Total net asset value
  
$
38,247,000
  

In connection with the acquisition $375,000 in merger costs were expensed.