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

|   | For the quarterly period ended September 30, 2012 |
|--------|---------------------------------------------------|

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

|   | For the transition period from _____ to _____ |
|--------|-----------------------------------------------|

|                                                                               |
|------------------------------------------------------------------------------------|
| Tengion, Inc.                                                                      |
| (Exact name of registrant as specified in its charter)                             |
| Delaware                                                                           |   | 20-0214813 |
| (State or other jurisdiction ofincorporation or organization)                 |   | (I.R.S. Employer Identification No.) |
| 3929 Westpoint Boulevard, Suite G Winston-Salem, NC 27103                          |   | (336) 722-5855 |
| (Address of principal executive offices)                                           |   | (Registrant’s telephone number,including area code)  |
| Not Applicable                                                                     |
| (Former name, former address and former fiscal year, if changed since last report) |
|                                                                               |   |   |

| Yes  x | No  o |
|-------------|------------|

| Yes  x | No  o |
|-------------|------------|

| Large accelerated filer  o | Accelerated filer  o | Non-accelerated filer  o | Smaller reporting company   x |
|---------------------------------|---------------------------|-------------------------------|-----------------------------------------|

| Yes  o | No  x |
|-------------|------------|

----

----

|   | Item 1. | Financial Statements (unaudited)                                                              |   |
|--------|---------|-----------------------------------------------------------------------------------------------|--------|
|   |    | Balance Sheets                                                                                | 1      |
|   |    | Statements of Operations                                                                      | 2      |
|   |    | Statements of Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit) | 3      |
|   |    | Statements of Cash Flows                                                                      | 5      |
|   |    | Notes to  Financial Statements                                                      | 6      |
|   | Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations   | 17     |
|   | Item 3. | Quantitative and Qualitative Disclosures About Market Risk                                    | 24     |
|   | Item 4. | Controls and Procedures                                                                       | 24     |
|   |    |                                                                                          |   |

|                 | Item 1.  | Legal Proceedings                                           | 25     |
|----------------------|----------|-------------------------------------------------------------|--------|
|                 | Item 1A. | Risk Factors                                                | 25     |
|                 | Item 2.  | Unregistered Sales of Equity Securities and Use of Proceeds | 28     |
|                 | Item 3.  | Defaults Upon Senior Securities                             | 28     |
|                 | Item 4.  | Mine Safety Disclosures                                     | 28     |
|                 | Item 5.  | Other Information                                           | 28     |
|                 | Item 6.  | Exhibits                                                    | 29     |
|                 |     |                                                        |   |
|  Signature Page |     | 30                                                          |

----

 Balance Sheets

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |         |             |     |                    |         |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------|------------------|----------|-------------------------|--------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |         | December 31,2011 |     | September 30, 2012 |
| ASSETS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| Current assets:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |    |             |     |                    |         |   |   |   |
| Cash and cash equivalents, including $1,194 of cash at December 31, 2011 and September 30, 2012, collateralizing letters of credit (Note 14)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |    | $                | 9,244    |                    |    | $      | 1,374 |   |
| Short-term investments                                                                                                                                                    |         |             | 6,066    |                    |         |   | — |   |
| Deferred debt offering costs                                                                                                                                              |         |             | —  |                    |         |   | 339 |   |
| Prepaid expenses and other                                                                                                                                                |    |             | 408      |                    |    |   | 395 |   |
| Total current assets                                                                                                                                                                                         |    |             | 15,718   |                    |    |   |             2,108 |   |
| Property and equipment, net of accumulated depreciation of $12,622 and $12,972 as of December 31, 2011 and September 30, 2012, respectively                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |    |             | 1,021    |                    |    |   | 686 |   |
| Other assets                                                                                                                                          |    |             | 1,078    |                    |    |   | 1,100 |   |
| Total assets                                                                                                                                          |    | $                | 17,817   |                    |    | $      | 3,894 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |    |             |     |                    |         |   |   |   |
| LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| Current liabilities:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |    |             |     |                    |         |   |   |   |
| Demand notes and derivative, net of debt discount of $31 as of September 30, 2012                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |    | $                | —  |                    |    | $      | 1,279 |   |
| Current portion of long-term debt                                                                                                                                         |    |             | 2,205    |                    |         |   | 900 |   |
| Accounts payable                                                                                                                                                          |    |             | 829      |                    |    |   | 1,404 |   |
| Accrued compensation and benefits                                                                                                                                         |    |             | 2,354    |                    |         |   | 587 |   |
| Accrued expenses                                                                                                                                                          |         |             | 437      |                    |         |   | 1,075 |   |
| Current portion of lease liability                                                                                                                                        |    |             | 739      |                    |    |   | 646 |   |
| Warrant liability                                                                                                                                                         |    |             | 2,511    |                    |    |   | 2,144 |   |
| Total current liabilities                                                                                                                                                                                    |    |             | 9,075    |                    |    |   | 8,035 |   |
| Long-term debt                                                                                                                                        |    |             | 2,782    |                    |    |   | 2,673 |   |
| Lease liability                                                                                                                                       |    |             | 943      |                    |    |   | 570 |   |
| Other liabilities                                                                                                                                     |    |             | 2        |                    |    |   | 8 |   |
| Total liabilities                                                                                                                                                                                            |    |             | 12,802   |                    |    |   | 11,286 |   |
|  Commitments and contingencies (Note 14)                                                                                                         |    |             | —  |                    |    |   | — |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |    |             |     |                    |         |   |   |   |
| Stockholders’ equity (deficit):                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |    |             |     |                    |         |   |   |   |
| Preferred stock, $0.001 par value; 10,000 shares authorized; zero shares issued or outstanding at December 31, 2011 and September 30, 2012, respectively                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |         |             | —  |                    |    |   | — |   |
| Common stock, $0.001 par value; 90,000 shares authorized; 2,381 and 2,449 shares issued and outstanding at December 31, 2011 and  September  30, 2012, respectively                                                                                                                                                                                                                                                                                                                                                                                                                                      |    |             | 2        |                    |    |   | 2 |   |
| Additional paid-in capital                                                                                                                                                |    |             | 235,257  |                    |         |   | 235,690 |   |
| Deficit accumulated during the development stage                                                                                                                          |    |             | (230,244 | )                       |         |   | (243,084 | ) |
| Total stockholders’ equity (deficit)                                                                                                                                                                   |    |             | 5,015    |                    |    |   | (7,392 | ) |
| Total liabilities and stockholders’ equity (deficit)                                                                                            |    | $                | 17,817   |                    |         | $      | 3,894 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |         |             |     |                    |         |   |   |   |

----

Statements of Operations 

|                                                                                     |   |   |               |         |   |   |              |    |   |   |                                 |   |   |   |    |   |   |   |                |   |
|------------------------------------------------------------------------------------------|--------|--------|--------------------|--------------|--------|--------|-------------------|---------|--------|--------|--------------------------------------|--------|--------|--------|---------|--------|--------|--------|---------------------|--------|
|                                                                                     |   |   | Three Months Ended |         |   |   | Nine Months Ended |    |   |   | Period fromJuly 10, 2003 (inception) |   |
|                                                                                     |   |   | September 30,      |         |   |   | September 30,     |    |   |   | through                              |   |
|                                                                                     |   |   |               |         |   |   |              |    |   |   |                                 |   |   |   |    |   |   |   |  September 30, |   |
|                                                                                     |   |   | 2011               |         |   |   | 2012              |    |   |   | 2011                                 |   |   |   | 2012    |   |   |   | 2012                |   |
|                                                                                     |   |   |               |         |   |   |              |    |   |   |                                 |   |   |   |    |   |   |   |                |   |
| Revenue                                                                                  |   | $      | —            |         |   | $      | —           |    |   | $      | —                              |   |   | $      | — |   |   | $      | —             |   |
|                                                                                     |   |   |               |         |   |   |              |    |   |   |                                 |   |   |   |    |   |   |   |                |   |
| Operating expenses:                                                                      |   |   |               |         |   |   |              |    |   |   |                                 |   |   |   |    |   |   |   |                |   |
| Research and development                                                                 |   | $      | 2,837              |    |   | $      | 2,438             |    |   | $      | 9,579                                |   |   | $      | 7,921   |   |   | $      | 125,778             |   |
| General and administrative                                                               |   |   | 1,383              |    |   |   | 1,198             |    |   |   | 5,197                                |   |   |   | 4,017   |   |   |   | 45,910              |   |
| Depreciation                                                                             |   |   | 718                |    |   |   | 106               |    |   |   | 2,816                                |   |   |   | 357     |   |   |   | 23,509              |   |
| Impairment of property and equipment                                                     |   |   | —            |         |   |   | —           |    |   |   | —                              |   |   |   | — |   |   |   | 7,371               |   |
| Other expense                                                                            |   |   | 26                 |         |   |   | 38                |    |   |   | 995                                  |   |   |   | 130     |   |   |   | 1,835               |   |
| Total operating expenses                                                                 |   |   | 4,964              |         |   |   | 3,780             |    |   |   | 18,587                               |   |   |   | 12,425  |   |   |   | 204,403             |   |
| Loss from operations                                                                     |   |   | (4,964             | )       |   |   | (3,780            | )       |   |   | (18,587                              | )      |   |   | (12,425 | )      |   |   | (204,403            | )      |
| Interest income                                                                          |   |   | 12                 |    |   |   | 1                 |    |   |   | 39                                   |   |   |   | 12      |   |   |   | 8,524               |   |
| Interest expense                                                                         |   |   | (193               | )            |   |   | (469              | )  |   |   | (666                                 | )      |   |   | (794    | )      |   |   | (15,683             | )      |
| Change in fair value of warrant liability                                                |   |   | 4,185              |         |   |   | (324              | )  |   |   |  14,123                         |   |   |   | 367     |   |   |   | 16,865              |   |
| Net loss                                                                                 |   | $      | (960               | )       |   | $      | (4,572            | )       |   | $      | (5,091                               | )      |   | $      | (12,840 | )      |   | $      | (194,697            | )      |
| Basic and diluted net loss attributable to common stockholders per share                 |   | $      | (0.41              | )       |   | $      | (1.87             | )  |   | $      | (2.43                                | )      |   | $      | (5.41   | )      |   |   |                |   |
|                                                                                     |   |   |               |         |   |   |              |    |   |   |                                 |   |   |   |    |   |   |   |                |   |
| Shares used in computing basic and diluted net loss attributable to common stockholders: |   |   |               |         |   |   |              |    |   |   |                                 |   |   |   |    |   |   |   |                |   |
|       Basic and diluted                                    |   |   | 2,354              |         |   |   | 2,450             |    |   |   | 2,094                                |   |   |   | 2,371   |   |   |   |                |   |

----

 Statements of Redeemable Convertible Preferred Stock 

|                                                                                            |   |                                  |    |   |   |         |    |   | Stockholders’ equity (deficit) |   |
|-------------------------------------------------------------------------------------------------|--------|---------------------------------------|---------|--------|--------|--------------|---------|--------|--------------------------------------|--------|
|                                                                                            |   | Redeemable convertiblepreferred stock |    |   |   | Common stock |    |   | Additional paid-in                   |   |   | Deferred |   |   | Deficit accumulated during thedevelopment |   |   |   |   |
|                                                                                            |   | Shares                                |    |   | Amount |         |    |   | Shares                               |   |   | Amount |   |   | capital |   |   | compensation |   |   | stage |   |   | Total |   |
|                                                                                            |   |                                  |    |   |   |         |    |   |                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance, July 10, 2003                                                                          |   |                                  | — |   |   | $            | — |   |                                 |   |   | — |   |   | $ | — |   |   | $ | — |   |   | $ | — |   |   | $ | — |   |   | $ | — |   |
| Issuance of common stock to initial stockholder                                                 |   |                                  | — |   |   |         | — |   |                                 |   |   | 138 |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Effect of June 2012 reverse stock split (see Note 3)                                            |   |                                  | — |   |   |         | — |   |                                 |   |   | (124 | )  |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Net loss                                                                                        |   |                                  | — |   |   |         | — |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | (1,032 | )  |   |   | (1,032 | )  |
| Balance, December 31, 2003                                                                      |   |                                  | — |   |   |         | — |   |                                 |   |   | 14 |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | (1,032 | )  |   |   | (1,032 | )  |
| Issuance of Series A Redeemable Convertible Preferred stock at $1.62 per share, net of expenses |   |                                  | 18,741  |   |   |         | 30,126  |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Conversion of notes payable, including interest                                                 |   |                                  | 2,203   |   |   |         | 3,562   |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Issuance of restricted common stock to employees and nonemployees                               |   |                                  | — |   |   |         | — |   |                                 |   |   | 24 |   |   |   | 1 |   |   |   | 336 |   |   |   | (336 | )  |   |   | — |   |   |   | 1 |   |
| Issuance of common stock to consultants                                                         |   |                                  | — |   |   |         | — |   |                                 |   |   | 14 |   |   |   | — |   |   |   | 21 |   |   |   | — |   |   |   | — |   |   |   | 21 |   |
| Issuance of common stock to convertible noteholders                                             |   |                                  | — |   |   |         | — |   |                                 |   |   | 9 |   |   |   | — |   |   |   | 67 |   |   |   | — |   |   |   | — |   |   |   | 67 |   |
| Issuance of options to purchase common stock to consultants for services rendered               |   |                                  | — |   |   |         | — |   |                                 |   |   | — |   |   |   | — |   |   |   | 14 |   |   |   | (14 | )  |   |   | — |   |   |   | — |   |
| Amortization of deferred compensation                                                           |   |                                  | — |   |   |         | — |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | 23 |   |   |   | — |   |   |   | 23 |   |
| Change in value of restricted common stock subject to vesting                                   |   |                                  | — |   |   |         | — |   |                                 |   |   | — |   |   |   | — |   |   |   | 11 |   |   |   | (11 | )  |   |   | — |   |   |   | — |   |
| Accretion of redeemable convertible preferred stock to redemption value                         |   |                                  | — |   |   |         | 1,035   |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | (1,035 | )  |   |   | (1,035 | )  |
| Net loss                                                                                        |   |                                  | — |   |   |         | — |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | (2,438 | )  |   |   | (2,438 | )  |
| Balance, December 31, 2004                                                                      |   |                                  | 20,944  |   |   |         | 34,723  |   |                                 |   |   | 61 |   |   |   | 1 |   |   |   | 449 |   |   |   | (338 | )  |   |   | (4,505 | )  |   |   | (4,393 | )  |
| Issuance of Series A Redeemable Convertible Preferred stock at $1.62 per share, net of expenses |   |                                  | 3,247   |   |   |         | 5,223   |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Issuance of restricted common stock to employees and nonemployees at $2.32 per share            |   |                                  | — |   |   |         | — |   |                                 |   |   | 6 |   |   |   | — |   |   |   | 140 |   |   |   | (139 | )  |   |   | — |   |   |   | 1 |   |
| Issuance of warrants to purchase preferred stock to noteholders                                 |   |                                  | — |   |   |         | — |   |                                 |   |   | — |   |   |   | — |   |   |   | 681 |   |   |   | — |   |   |   | — |   |   |   | 681 |   |
| Issuance of options to purchase common stock to consultants for services rendered               |   |                                  | — |   |   |         | — |   |                                 |   |   | — |   |   |   | — |   |   |   | 7 |   |   |   | (7 | )  |   |   | — |   |   |   | — |   |
| Amortization of deferred compensation                                                           |   |                                  | — |   |   |         | — |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | 111 |   |   |   | — |   |   |   | 111 |   |
| Accretion of redeemable convertible preferred stock to redemption value                         |   |                                  | — |   |   |         | 3,164   |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | (3,164 | )  |   |   | (3,164 | )  |
| Net loss                                                                                        |   |                                  | — |   |   |         | — |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | (9,627 | )  |   |   | (9,627 | )  |
| Balance, December 31, 2005                                                                      |   |                                  | 24,191  |   |   |         | 43,110  |   |                                 |   |   | 67 |   |   |   | 1 |   |   |   | 1,277 |   |   |   | (373 | )  |   |   | (17,296 | )  |   |   | (16,391 | )  |
| Issuance of Series B Redeemable Convertible Preferred stock at $1.82 per share, net of expenses |   |                                  | 27,637  |   |   |         | 50,040  |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Issuance of restricted common stock to employees                                                |   |                                  | — |   |   |         | — |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Issuance of common stock upon exercise of options                                               |   |                                  | — |   |   |         | — |   |                                 |   |   | — |   |   |   | — |   |   |   | 9 |   |   |   | — |   |   |   | — |   |   |   | 9 |   |
| Repurchased nonvested restricted stock                                                          |   |                                  | — |   |   |         | — |   |                                 |   |   | (1 | )  |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Reclassification of deferred compensation                                                       |   |                                  | — |   |   |         | — |   |                                 |   |   | — |   |   |   | — |   |   |   | (373 | ) |   |   | 373 |   |   |   | — |   |   |   | — |   |
| Reclassification of warrants to purchase preferred stock                                        |   |                                  | — |   |   |         | — |   |                                 |   |   | — |   |   |   | — |   |   |   | (681 | ) |   |   | — |   |   |   | — |   |   |   | (681 | )  |
| Stock-based compensation expense                                                                |   |                                  | — |   |   |         | — |   |                                 |   |   | — |   |   |   | — |   |   |   | 400 |   |   |   | — |   |   |   | — |   |   |   | 400 |   |
| Accretion of redeemable convertible preferred stock to redemption value                         |   |                                  | — |   |   |         | 5,640   |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | (5,640 | )  |   |   | (5,640 | )  |
| Net loss                                                                                        |   |                                  | — |   |   |         | — |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | (20,873 | )  |   |   | (20,873 | )  |
| Balance, December 31, 2006                                                                      |   |                                  | 51,828  |   |   |         | 98,790  |   |                                 |   |   | 66 |   |   |   | 1 |   |   |   | 632 |   |   |   | — |   |   |   | (43,809 | )  |   |   | (43,176 | )  |
| Issuance of Series C Redeemable Convertible Preferred stock at $1.82 per share, net of expenses |   |                                  | 18,333  |   |   |         | 33,219  |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Issuance of common stock upon exercise of options                                               |   |                                  | — |   |   |         | — |   |                                 |   |   | 3 |   |   |   | — |   |   |   | 60 |   |   |   | — |   |   |   | — |   |   |   | 60 |   |
| Repurchased vested restricted stock                                                             |   |                                  | — |   |   |         | — |   |                                 |   |   | (1 | )  |   |   | — |   |   |   | (94 | ) |   |   | — |   |   |   | — |   |   |   | (94 | ) |
| Stock-based compensation expense                                                                |   |                                  | — |   |   |         | — |   |                                 |   |   | — |   |   |   | — |   |   |   | 664 |   |   |   | — |   |   |   | — |   |   |   | 664 |   |
| Accretion of redeemable convertible preferred stock to redemption value                         |   |                                  | — |   |   |         | 8,742   |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | (8,742 | )  |   |   | (8,742 | )  |
| Net loss                                                                                        |   |                                  | — |   |   |         | — |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | (30,988 | )  |   |   | (30,988 | )  |
| Balance, December 31, 2007                                                                      |   |                                  | 70,161  |   |   | $            | 140,751 |   |                                 |   |   | 68 |   |   | $ | 1 |   |   | $ | 1,262 |   |   | $ | — |   |   | $ | (83,539 | ) |   | $ | (82,276 | ) |
|                                                                                            |   |                                  |    |   |   |         |    |   |                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

|                                                                                            |   |                                  |    |   |   |         |     |   | Stockholders’ equity (deficit) |   |
|-------------------------------------------------------------------------------------------------|--------|---------------------------------------|---------|--------|--------|--------------|----------|--------|--------------------------------------|--------|
|                                                                                            |   | Redeemable convertiblepreferred stock |    |   |   | Common stock |     |   | Additional paid-in                   |   |   | Deferred |   |   | Deficit accumulated during the development |   |   |   |   |
|                                                                                            |   | Shares                                |    |   | Amount |         |     |   | Shares                               |   |   | Amount |   |   | capital |   |   | compensation |   |   | stage |   |   | Total |   |
|                                                                                            |   |                                  |    |   |   |         |     |   |                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance, December 31, 2007                                                                      |   |                                  | 70,161  |   |   | $            | 140,751  |   |                                 |   |   | 68 |   |   | $ | 1 |   |   | $ | 1,262 |   |   | $ | — |   |   | $ | (83,539 | ) |   | $ | (82,276 | ) |
| Issuance of Series C Redeemable Convertible Preferred stock at $1.82 per share, net of expenses |   |                                  | 11,793  |   |   |         | 21,352   |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Issuance of common stock upon exercise of options                                               |   |                                  | — |   |   |         | —  |   |                                 |   |   | — |   |   |   | — |   |   |   | 28 |   |   |   | — |   |   |   | — |   |   |   | 28 |   |
| Repurchased vested restricted stock                                                             |   |                                  | — |   |   |         | —  |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Stock-based compensation expense                                                                |   |                                  | — |   |   |         | —  |   |                                 |   |   | — |   |   |   | — |   |   |   | 1,317 |   |   |   | — |   |   |   | — |   |   |   | 1,317 |   |
| Accretion of redeemable convertible preferred stock to redemption value                         |   |                                  | — |   |   |         | 11,754   |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | (11,754 | )  |   |   | (11,754 | )  |
| Net loss                                                                                        |   |                                  | — |   |   |         | —  |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | (42,393 | )  |   |   | (42,393 | )  |
| Balance, December 31, 2008                                                                      |   |                                  | 81,954  |   |   |         | 173,857  |   |                                 |   |   | 68 |   |   |   | 1 |   |   |   | 2,607 |   |   |   | — |   |   |   | (137,686 | )  |   |   | (135,078 | )  |
| Issuance of common stock upon exercise of options                                               |   |                                  | — |   |   |         | —  |   |                                 |   |   | 2 |   |   |   | — |   |   |   | 54 |   |   |   | — |   |   |   | — |   |   |   | 54 |   |
| Stock-based compensation expense                                                                |   |                                  | — |   |   |         | —  |   |                                 |   |   | — |   |   |   | — |   |   |   | 855 |   |   |   | — |   |   |   | — |   |   |   | 855 |   |
| Accretion of redeemable convertible preferred stock to redemption value                         |   |                                  | — |   |   |         | 14,059   |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | (14,059 | )  |   |   | (14,059 | )  |
| Net loss                                                                                        |   |                                  | — |   |   |         | —  |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | (29,845 | )  |   |   | (29,845 | )  |
| Balance, December 31, 2009                                                                      |   |                                  | 81,954  |   |   |         | 187,916  |   |                                 |   |   | 70 |   |   |   | 1 |   |   |   | 3,516 |   |   |   | — |   |   |   | (181,590 | )  |   |   | (178,073 | )  |
| Issuance of common stock upon exercise of options                                               |   |                                  | — |   |   |         | —  |   |                                 |   |   | 3 |   |   |   | — |   |   |   | 14 |   |   |   | — |   |   |   | — |   |   |   | 14 |   |
| Accretion of redeemable convertible preferred stock to redemption value                         |   |                                  | — |   |   |         | 3,993    |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | (3,993 | )  |   |   | (3,993 | )  |
| Conversion of preferred stock to common stock                                                   |   |                                  | (81,954 | )      |   |         | (191,909 | )      |                                 |   |   | 566 |   |   |   | — |   |   |   | 191,909 |   |   |   | — |   |   |   | — |   |   |   | 191,909 |   |
| Conversion of preferred stock warrants to common stock warrants                                 |   |                                  | — |   |   |         | —  |   |                                 |   |   | — |   |   |   | — |   |   |   | 123 |   |   |   | — |   |   |   | — |   |   |   | 123 |   |
| Proceeds from initial public offering, net of expenses                                          |   |                                  | — |   |   |         | —  |   |                                 |   |   | 600 |   |   |   | — |   |   |   | 25,727 |   |   |   | — |   |   |   | — |   |   |   | 25,727 |   |
| Stock-based compensation expense                                                                |   |                                  | — |   |   |         | —  |   |                                 |   |   | — |   |   |   | — |   |   |   | 953 |   |   |   | — |   |   |   | — |   |   |   | 953 |   |
| Net loss                                                                                        |   |                                  | — |   |   |         | —  |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | (25,600 | )  |   |   | (25,600 | )  |
| Balance, December 31, 2010                                                                      |   |                                  | — |   |   |         | —  |   |                                 |   |   | 1,239 |   |   |   | 1 |   |   |   | 222,242 |   |   |   | — |   |   |   | (211,183 | )  |   |   | 11,060 |   |
| Proceeds from equity financing, net of expenses                                                 |   |                                  | — |   |   |         | —  |   |                                 |   |   | 1,108 |   |   |   | 1 |   |   |   | 28,940 |   |   |   | — |   |   |   | — |   |   |   | 28,941 |   |
| Issuance of warrants to purchase common stock issued in connection with equity financing        |   |                                  | — |   |   |         | —  |   |                                 |   |   | — |   |   |   | — |   |   |   | (16,947 | ) |   |   | — |   |   |   | — |   |   |   | (16,947 | ) |
| Issuance of common stock upon exercise of options                                               |   |                                  | — |   |   |         | —  |   |                                 |   |   | 18 |   |   |   | — |   |   |   | 83 |   |   |   | — |   |   |   | — |   |   |   | 83 |   |
| Issuance of restricted stock to employees                                                       |   |                                  | — |   |   |         | —  |   |                                 |   |   | 31 |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Cancellation of restricted stock to employees                                                   |   |                                  | — |   |   |         | —  |   |                                 |   |   | (15 | ) |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Issuance of warrants to purchase common stock in connection with debt financing                 |   |                                  | — |   |   |         | —  |   |                                 |   |   | — |   |   |   | — |   |   |   | 105 |   |   |   | — |   |   |   | — |   |   |   | 105 |   |
| Stock-based compensation expense                                                                |   |                                  | — |   |   |         | —  |   |                                 |   |   | — |   |   |   | — |   |   |   | 834 |   |   |   | — |   |   |   | — |   |   |   | 834 |   |
| Net loss                                                                                        |   |                                  | — |   |   |         | —  |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | (19,061 | )  |   |   | (19,061 | )  |
| Balance, December 31, 2011                                                                      |   |                                  | — |   |   |         | —  |   |                                 |   |   | 2,381 |   |   |   | 2 |   |   |   | 235,257 |   |   |   | — |   |   |   | (230,244 | )  |   |   | 5,015 |   |
| Issuance of common stock upon exercise of options                                               |   |                                  | — |   |   |         | —  |   |                                 |   |   | 3 |   |   |   | — |   |   |   | 10 |   |   |   | — |   |   |   | — |   |   |   | 10 |   |
| Issuance of restricted stock to employees                                                       |   |                                  | — |   |   |         | —  |   |                                 |   |   | 68 |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Cancellation of restricted stock to employees                                                   |   |                                  | — |   |   |         | —  |   |                                 |   |   | (3 | ) |   |   | — |   |   |   | (5 | ) |   |   | — |   |   |   | — |   |   |   | (5 | ) |
| Stock-based compensation expense                                                                |   |                                  | — |   |   |         | —  |   |                                 |   |   | — |   |   |   | — |   |   |   | 428 |   |   |   | — |   |   |   | — |   |   |   | 428 |   |
| Net loss                                                                                        |   |                                  | — |   |   |         | —  |   |                                 |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | (12,840 | )  |   |   | (12,840 | )  |
| Balance, September 30, 2012                                                                     |   |                                  | — |   |   | $            | —  |   |                                 |   |   | 2,449 |   |   | $ | 2 |   |   | $ | 235,690 |   |   | $ | — |   |   | $ | (243,084 | ) |   | $ | (7,392 | ) |
|                                                                                            |   |                                  |    |   |   |         |     |   |                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

 Statements of Cash Flows

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                           |        |                                                              |   |   |    |    |   |   |     |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------|-------------|-------------------------------------------------------------------|--------|--------|---------|---------|--------|--------|----------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   | Nine Months EndedSeptember 30, |        | Period fromJuly 10, 2003(inception)throughSeptember 30, 2012 |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   | 2011                           |        | 2012                                                              |   |
| Cash flows from operating activities:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                           |        |                                                              |   |   |    |    |   |   |     |   |
| Net loss                                                                                                                                                       |   | $                              | (5,091      | )                                                                 |   | $      | (12,840 | )       |   | $      | (194,697 | )      |
| Adjustments to reconcile net loss to net cash used in operating activities:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                           |        |                                                              |   |   |    |    |   |   |     |   |
| Depreciation                                                                                                                                                                  |   |                           | 2,816       |                                                              |   |   | 357     |    |   |   | 23,509   |   |
| Change in fair value of warrant liability                                                                                                                                     |   |                           | (14,123     | )                                                                 |   |   | (367    | )       |   |   | (16,865  | )      |
| Charge related to lease liability                                                                                                                                             |   |                           | 995         |                                                              |   |   | 130     |    |   |   | 1,835    |   |
| Loss on disposition of property and equipment                                                                                                                                 |   |                           | —     |                                                              |   |   | — |    |   |   | 119      |   |
| Impairment of property and equipment                                                                                                                                          |   |                           | —     |                                                              |   |   | — |    |   |   | 7,371    |   |
| Amortization of net discount on short-term investments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                           | —     |                                                              |   |   | — |    |   |   | (149     | )      |
| Noncash interest expense                                                                                                                                                      |   |                           | 132         |                                                              |   |   | 409     |    |   |   | 2,957    |   |
| Noncash rent (income) expense                                                                                                                                                 |   |                           | (22         | )                                                                 |   |   | 6       |    |   |   | 223      |   |
| Stock-based compensation expense                                                                                                                                              |   |                           | 688         |                                                              |   |   | 428     |    |   |   | 5,607    |   |
| Changes in operating assets and liabilities:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |                           |        |                                                              |   |   |    |    |   |   |     |   |
| Prepaid expenses and other assets                                                                                                                                                            |   |                           | (810        | )                                                                 |   |   | (41     | )  |   |   | (1,669   | )      |
| Accounts payable                                                                                                                                                                             |   |                           | (146        | )                                                                 |   |   | 428     |    |   |   | 1,298    |   |
| Accrued expenses and other                                                                                                                                                                   |   |                           | (1,611      | )                                                                 |   |   | (1,909  | )       |   |   | 854      |   |
| Net cash used in operating activities                                                                                                                                                                            |   |                           | (17,172     | )                                                                 |   |   | (13,399 | )       |   |   | (169,607 | )      |
| Cash flows from investing activities:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                           |        |                                                              |   |   |    |    |   |   |     |   |
| Purchases of short-term investments                                                                                                                            |   |                           | (13,083     | )                                                                 |   |   | — |    |   |   | (324,508 | )      |
| Sales and redemption of short-term investments                                                                                                                 |   |                           |  2,000 |                                                              |   |   | 6,066   |    |   |   | 324,657  |   |
| Cash paid for property and equipment                                                                                                                           |   |                           | (81         | )                                                                 |   |   | (22     | )       |   |   | (31,696  | )      |
| Proceeds from the sale of property and equipment                                                                                                               |   |                           | —     |                                                              |   |   | — |    |   |   | 11       |   |
| Net cash (used in) provided by investing activities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                           | (11,164     | )                                                                 |   |   | 6,044   |    |   |   | (31,536  | )      |
| Cash flows from financing activities:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                           |        |                                                              |   |   |    |    |   |   |     |   |
| Proceeds from sales of redeemable convertible preferred stock and warrants, net                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |   |                           | —     |                                                              |   |   | — |    |   |   | 139,960  |   |
| Proceeds from sales of common stock and warrants, net                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                           | 29,027      |                                                              |   |   | 6       |    |   |   | 54,923   |   |
| Repurchase of restricted stock                                                                                                                                 |   |                           | —     |                                                              |   |   | — |    |   |   | (94      | )      |
| Proceeds from long-term debt, net of issuance costs                                                                                                            |   |                           | 4,908       |                                                              |   |   | 945     |    |   |   | 40,462   |   |
| Payments on long-term debt                                                                                                                                     |   |                           | (8,308      | )                                                                 |   |   | (1,466  | )       |   |   | (32,734  | )      |
| Net cash provided by (used in) financing activities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                           | 25,627      |                                                              |   |   | (515    | )       |   |   | 202,517  |   |
| Net increase (decrease) in cash and cash equivalents                                                                                            |   |                           | (2,709      | )                                                                 |   |   | (7,870  | )       |   |   | 1,374    |   |
| Cash and cash equivalents, beginning of period                                                                                                  |   |                           | 11,972      |                                                              |   |   | 9,244   |    |   |   | —  |   |
| Cash and cash equivalents, end of period                                                                                                        |   | $                              | 9,263       |                                                              |   | $      | 1,374   |    |   | $      | 1,374    |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |                           |        |                                                              |   |   |    |    |   |   |     |   |

----

Notes to Financial Statements

| (1)   | Organization and Nature of Operations |
|-----------------|---------------------------------------|

| (2)   | Management’s Plans to Continue as a Going Concern |
|-----------------|---------------------------------------------------------|

----

| (3)   | Basis of Presentation and Reverse Stock Split |
|-----------------|-----------------------------------------------|

| (4)   | Use of Estimates |
|-----------------|------------------|

| (5)   | Net Loss Attributable to Common Stockholders Per Share |
|-----------------|--------------------------------------------------------|

|                                   |   |                            |      |                           |
|----------------------------------------|--------|---------------------------------|-----------|--------------------------------|
|                                   |   | Three Months EndedSeptember 30, |      | Nine Months EndedSeptember 30, |
|                                   |   |                            | 2011      |                           |   |   | 2012 |   |   |   | 2011 |   |   |   | 2012 |   |
| Shares underlying warrants outstanding |   |                            | 1,064,616 |                           |   |   | 1,064,616 |   |   |   | 1,064,616 |   |   |   | 1,064,616 |   |
| Shares underlying options outstanding  |   |                            | 127,500   |                           |   |   | 247,952 |   |   |   | 127,500 |   |   |   | 247,952 |   |
| Unvested restricted stock              |   |                            | 20,310    |                           |   |   | 74,669 |   |   |   | 20,310 |   |   |   | 74,669 |   |

----

| (6)   | Supplemental Cash Flow Information |
|-----------------|------------------------------------|

|                                                                                                                                                                                                                                                                                                                                                                                                          |    | Nine Months Ended September 30, |   |    |    | Period from July 10, 2003(inception) through |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------|---------------------------------|--------|---------|---------|---------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                          |    | 2011                            |   |    | 2012    |                                              |   |   | September 30, 2012 |
| Supplemental cash flow disclosures:                                                                                                                                                                                                                                                                                                                                                                           |    |                            |   |    |    |                                              |   |   |   |
| Noncash investing and financing activities:                                                                                                                                                                                                                                                                                                                                                                   |    |                            |   |    |    |                                              |   |   |   |
| Conversion of note principal to redeemable convertible preferred stock                                                                                                                                                                                                                                                                                                                                        |  $ | —                         |   |  $ | — |                                              |   |  $ | 3,562 |
| Convertible note issued to initial stockholder for consulting expense                                                                                                                                                                                                                                                                                                                                         |    | —                         |   |    | — |                                              |   |   | 210 |
| Fair value of warrants issued with issuance of long-term debt                                                                                                                                                                                                                                                                                                                                                 |    | 105                             |   |    | — |                                              |   |   | 2,290 |
| Fair value of warrants issued with sale of common stock                                                                                                                                                                                                                                                                                                                                                       |    | 16,947                          |   |    | — |                                              |   |   | 16,947 |
| Fair value of embedded derivative issued with the demand note                                                                                                                                                                                                                                                                                                                                                 |    | —                         |   |    | 310     |                                              |   |   | 310 |
| Conversion of warrant liability                                                              |    | —                         |   |    | — |                                              |   |   | 123 |

| (7)   | Short-term Investments and Fair Value of Financial Instruments |
|-----------------|----------------------------------------------------------------|

| ·   | Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Level 2: Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability; or |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity). |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                          | Fair value measurement at reporting date using                 |    |
|-----------------------------------------------|----------------------------------------------------------------|---------|
|                                          | Quoted prices in active markets for identical assets (Level 1) |    |   | Significant other observable inputs(Level 2) |   |   | Significant unobservable inputs(Level 3) |   |   | Total |   |
|                                          |                                                           |    |   |   |   |   |   |   |   |   |   |
| At December 31, 2011:                         |                                                           |    |   |   |   |   |   |   |   |   |   |
| Assets:                                       |                                                           |    |   |   |   |   |   |   |   |   |   |
| Cash and cash equivalents                     | $                                                              | 9,244   |   |   | $ | — |   |   | $ | — |   |   | $ | 9,244 |   |
| Short-term investments                        |                                                           | 6,066   |   |   |   | — |   |   |   | — |   |   |   | 6,066 |   |
|                                          | $                                                              | 15,310  |   |   | $ | — |   |   | $ | — |   |   | $ | 15,310 |   |
| Liabilities:                                  |                                                           |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Warrant liability                        | $                                                              | — |   |   | $ | — |   |   | $ | 2,511 |   |   | $ | 2,511 |   |
|                                          |                                                           |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| At September 30, 2012:                        |                                                           |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Assets:                                       |                                                           |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash and cash equivalents                     | $                                                              | 1,374   |   |   | $ | — |   |   | $ | — |   |   | $ | 1,374 |   |
| Short-term investments                        |                                                           | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
|                                          | $                                                              | 1,374   |   |   | $ | — |   |   | $ | — |   |   | $ | 1,374 |   |
| Liabilities:                                  |                                                           |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Embedded derivative liability of Demand Notes | $                                                              | — |   |   | $ | — |   |   | $ | 310 |   |   | $ | 310 |   |
| Warrant liability                             |                                                           | — |   |   |   | — |   |   |   | 2,144 |   |   |   | 2,144 |   |
|                                          | $                                                         |    |   |   | $ | — |   |   | $ | 2,454 |   |   | $ | 2,454 |   |
|                                          |                                                           |    |   |   |   |   |   |   |   |   |   |   |   |   |   |

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |         | Embedded Derivative liabilityof Demand Notes |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------|----------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |         |                                         |   |   |
| Balance at December 31, 2011                                                                                                          |         | $                                            | — |   |
| Record derivative liability                                                                                                                                    |    |                                         | 310 |   |
| Balance at September 30, 2012                                                                                                         |    | $                                            | 310 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |         |                                         |   |   |

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |         | Warrant liability |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------|-------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |         |              |   |   |
| Balance at December 31, 2011                                                                                                          |         | $                 | 2,511 |   |
| Change in fair value of warrant liability                                                                                                                      |    |              | (367 | ) |
| Balance at September 30, 2012                                                                                                         |    | $                 | 2,144 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |         |              |   |   |

----

| (8)   | Restructuring Expenses |
|-----------------|------------------------|

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |         | Accrued Severance Benefits |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------|----------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |         |                       |   |   |
| Balance at December 31, 2011                                                                                                          |         | $                          | 1,544 |   |
| Net charges paid                                                                                                                                               |    |                       | (1,544 | ) |
| Balance at September 30, 2012                                                                                                         |    | $                          | — |   |

| (9)   | Lease Liability |
|-----------------|-----------------|

|                             |   | Warehousespace |   | Office and manufacturingspace |   | Total  |
|----------------------------------|--------|----------------|--------|-------------------------------|--------|--------|
| Balance at December 31, 2011     |   | $              | 828    |                          |   | $      | 854 |   |   | $ | 1,682 |   |
| Charges utilized                 |   |           | (178   | )                             |   |   | (418 | ) |   |   | (596 | ) |
| Additional charges to operations |   |           | 67     |                          |   |   | 63 |   |   |   | 130 |   |
| Balance at September 30, 2012    |   |           | 717    |                          |   |   | 499 |   |   |   | 1,216 |   |
| Less current portion             |   |           | (231   | )                             |   |   | (415 | ) |   |   | (646 | ) |
|                             |   | $              | 486    |                          |   | $      | 84 |   |   | $ | 570 |   |
|                             |   |           |   |                          |   |   |   |   |   |   |   |   |

| (10)   | Debt |
|------------------|------|

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |         |             |    |                    |         |    |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------|------------------|---------|-------------------------|--------------|---------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |         | December 31,2011 |    | September 30, 2012 |
| Working Capital Note                                                                                         |    | $                | 5,000   |                    |    | $       | 3,660 |   |
| Equipment and Supplemental Working Capital Notes                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |    |             | 126     |                    |    |    | — |   |
| Unamortized debt discount                                                                                    |    |             | (139    | )                       |    |    | (87 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |    |             | 4,987   |                    |    |    | 3,573 |   |
| Less current portion                                                                                         |    |             | (2,205  | )                       |    |    | (900 | ) |
| Total  long-term debt                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |    | $                | 2,782   |                    |    | $       | 2,673 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |    |             |    |                    |         |    |   |   |
| Demand Notes                                                                                                 |         |             | — |                    |    |  $ | 1,000 |   |
| Embedded derivative liability                                                                                |         |             | — |                    |    |    | 310 |   |
| Unamortized debt discount related to Demand Notes                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |    |             | — |                    |         |    | (31 | ) |
| Total Demand Notes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |    | $                | — |                    |    | $       | 1,279 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |         |             |    |                    |         |    |   |   |
| Total debt outstanding                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |         | $                | 4,987   |                    |         | $       | 4,852 |   |

----

----

|                                                |   | September 7, 2012 |   |   | September 30, 2012 |   |
|-----------------------------------------------------|--------|-------------------|--------|--------|-------------------------|--------|
|                                                |   |              |   |   |                    |   |
| Calculated aggregate value                          |   | $                 | 310    |   |                    | $      | 310 |   |
| Volatility                                          |   |              | 115.0  | %      |                    |   | 115.0 | % |
| Probability of Fundamental Transaction or Delisting |   |              | 100.0  | %      |                    |   | 100.0 | % |
| Risk-free interest rate                             |   |              | 0.2    | %      |                    |   | 0.2 | % |
| Dividend yield                                      |   | None              |   |   | None                    |   |

| (11)   | Capital Structure |
|------------------|-------------------|

| (12)   | Warrants |
|------------------|----------|

|                                                              | Number of shares |   | Exercise price |   | Expiration |
|-------------------------------------------------------------------|------------------|--------|----------------|--------|------------|
| Equity–classified warrants                                  |             |   |           |   |       |   |
| Issued to vendors                                                 | 389              |   | $              | 23.20  |       | September 2015 through December 2016 |
| Issued pursuant to March 2011 refinancing of Working Capital Note | 7,068            |   | $              | 28.80  |       | March 2016 |
| Issued to lenders                                                 | 6,449            |   | $              | 234.40 |       | August 2013 through December 2016 |
| Issued to lenders                                                 | 4,608            |   | $              | 263.90 |       | October 2015 through September 2019 |
|                                                              | 18,514           |   |           |   |       |   |
| Liability–classified warrants                               |             |   |           |   |       |   |
| Issued pursuant to March 2011 equity financing                    | 1,046,102        |   | $              | 28.80  |       | March 2016 |
|                                                              | 1,064,616        |   |           |   |       |   |

----

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                      |   | Fair value as of: |   |   |              | Net cashsettlement valueas ofSeptember 30, 2012 |   |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------|--------|--------|-------------------|-------------------------------------------------|--------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                      |   | December 31, 2011 |   |   | September 30,2012 |                                            |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |              |   |   |              |                                            |   |   |   |   |   |
| Calculated aggregate value                                                                           |   | $                 | 2,511  |   |              | $                                               | 2,144  |   |   |   | $ | 1,060 | (1) |   |
| Exercise price per share of warrant                                                                  |   | $                 | 28.80  |   |              | $                                               | 1.67   | (2)    |   |   | $ | 28.80 |  (2) |   |
| Closing price per share of common stock                                                                                                                                                                                                                                                                                                                                                                                                   |   | $                 | 4.70   |   |              | Not applicable                                  | (3)    |   |   | $ | 1.35 |   |   |
| Volatility                                                                                           |   |              | 93.8%  |   |              |                                            | 115.0% |   |   |   |   | 195.9% | (4) |   |
| Probability of Fundamental Transaction or Delisting                                                                                                                                                                                                                                                                                                                                                                                       |   |              | 28.9%  |   |              |                                            | 100.0% |   |   |   | Not applicable |   |   |
| Expected term (years)                                                                                |   | Not applicable    |   |   | Not applicable    |  (3)                                       |   |   |   | 3.4 |   |   |
| Risk-free interest rate                                                                              |   |              | 0.7%   |   |              |                                            | 0.2%   |   |   |   |   | 0.3% |   |   |
| Dividend yield                                                                                       |   | None              |   |   | None              |                                            |   |   | None |   |   |

----

|   | (1) | Represents the net cash settlement value of the warrant as of September 30, 2012, which value was calculated utilizing the Black-Scholes model specified in the warrant. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | Although the exercise price per share of the warrant remained $28.80 as of September 30, 2012, the Company calculated the fair value of the warrants as of September 30, 2012 using an estimated exercise price per share of $1.67, which the Company believed was a reasonable approximation of the exercise price after calculation of the anti-dilution adjustment necessitated by the private placement completed October 3, 2012. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (3) | In performing the valuation as of September 30, 2012, the Company believed the common stock price had not fully adjusted for the potential future dilution from the private placement completed October 3, 2012. Therefore, the Company used an implied enterprise value which was derived by using a scenario-based approach considering the possible future liquidity events for the Company contingent upon the outcome of its research programs.  One of the possible expected scenarios has an expected term of nine months and the other scenario has a term of 2.3 years.  Refer elsewhere in Note 12 for further details on valuation methodology used. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (4) | Represents the volatility assumption used to calculate the net cash settlement value as of September 30, 2012. |
|--------|-----|----------------------------------------------------------------------------------------------------------------|

| (13)  | Stock-Based Compensation |
|------------|--------------------------|

|                                              |   |   | Number of shares |   |   |   | Weighted-average exercise price |   |   |   | Weighted-average remaining contractual term (in years) |   |   |   | Aggregate intrinsic value (in thousands) |   |
|---------------------------------------------------|--------|--------|------------------|--------|--------|--------|---------------------------------|--------|--------|--------|--------------------------------------------------------|--------|--------|--------|------------------------------------------|--------|
|                                              |   |   |             |   |   |   |                            |   |   |   |                                                   |   |   |   |                                     |   |
| Outstanding at December 31, 2011                  |   |   | 174,874          |   |   | $      | 16.77                           |   |   |   | 8.9                                                    |   |   | $      | 63                                       |   |
| Granted                                           |   |   | 87,184           |   |   | $      | 5.66                            |   |   |   |                                                   |   |   |   |                                     |   |
| Exercised                                         |   |   | (2,432           | )      |   | $      | 4.40                            |   |   |   |                                                   |   |   |   |                                     |   |
| Forfeited                                         |   |   | (11,674          | )      |   | $      | 22.64                           |   |   |   |                                                   |   |   |   |                                     |   |
| Outstanding at September 30, 2012                 |   |   | 247,952          |   |   | $      | 12.71                           |   |   |   | 8.6                                                    |   |   | $      | —                                  |   |
|                                              |   |   |             |   |   |   |                            |   |   |   |                                                   |   |   |   |                                     |   |
| Vested and expected to vest at September 30, 2012 |   |   | 229,059          |   |   | $      | 13.09                           |   |   |   | 8.6                                                    |   |   | $      | —                                  |   |
|                                              |   |   |             |   |   |   |                            |   |   |   |                                                   |   |   |   |                                     |   |
| Exercisable at September 30, 2012                 |   |   | 57,906           |   |   | $      | 27.35                           |   |   |   | 7.1                                                    |   |   | $      | —                                  |   |
|                                              |   |   |             |   |   |   |                            |   |   |   |                                                   |   |   |   |                                     |   |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | Number of shares |   | Weighted-average grant date fair value |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------|--------|----------------------------------------|--------|
| Nonvested at December 31, 2011                                                                                                     | 13,988           |   |                                   | $      | 24.20 |   |
| Granted                                                                                                                            | 67,863           |   |                                   | $      | 6.00 |   |
| Vested                                                                                                                             | (5,047           | )      |                                   | $      | 24.20 |   |
| Forfeited                                                                                                                          | (2,135           | )      |                                   | $      | 17.64 |   |
| Nonvested at September 30, 2012                                                                                                    | 74,669           |   |                                   | $      | 7.84 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |             |   |                                   |   |   |   |

| (14)   | Commitments and Contingencies |
|------------------|-------------------------------|

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |         |   |   |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------|--------|--------|--------|
| 2012                                                                                                                  |         | $      | 320    |   |
| 2013                                                                                                                  |         |   | 1,016  |   |
| 2014                                                                                                                  |         |   | 1,040  |   |
| 2015                                                                                                                  |         |   | 1,063  |   |
| 2016                                                                                                                  |         |   | 276    |   |
| Total minimum lease payments                                                                                                                        |    | $      | 3,715  |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |         |   |   |   |

----

| (15)   | Subsequent Events |
|------------------|-------------------|

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

----

----

----

| ·   | personnel related expenses, including salaries, benefits, travel and other related expenses including stock-based compensation; |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------|

| ·   | payments made to third-party contract research organizations for preclinical studies, investigative sites for clinical trials and consultants; |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | costs associated with regulatory filings and the advancement of our product candidates through preclinical studies and clinical trials; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------|

| ·   | laboratory and other supplies; |
|--------------------|--------------------------------|

| ·   | manufacturing development costs; and |
|--------------------|--------------------------------------|

| ·   | facility maintenance. |
|--------------------|-----------------------|

|                                      |   |                             |   |                           |         |   |   |   |   |   |      |   |         |   |   |   |   |   |   |   |         |   |   |   |
|-------------------------------------------|--------|----------------------------------|--------|--------------------------------|--------------|--------|--------|--------|--------|--------|-----------|--------|--------------|--------|--------|--------|--------|--------|--------|--------|--------------|--------|--------|--------|
|                                      |   | Three months ended September 30, |   | Nine months endedSeptember 30, |
|                                      |   | 2011                             |   | 2012                           |         | Change |   | 2011   |   | 2012   |      | Change |
| Third-party direct program expenses:      |   |                             |   |                           |         |   |   |   |   |   |      |   |         |   |   |   |   |   |   |   |         |   |   |   |
| Urologic                                  |   | $                                | 121    |                           |    | $      | 195    |   |   | $      | 74        |   |    | $      | 550    |   |   | $      | 535    |   |    | $      | (15    | )      |
| Renal                                     |   |                             | 564    |                           |    |   | 525    |   |   |   |  (39 | )      |    |   | 1,676  |   |   |   | 1,517  |   |    |   | (159   | )      |
| Total third-party direct program expenses |   |                             | 685    |                           |    |   | 720    |   |   |   | 35        |   |    |   | 2,226  |   |   |   | 2,052  |   |    |   | (174   | )      |
| Other research and development expense    |   |                             | 2,152  |                           |    |   | 1,718  |   |   |   | (434      | )      |    |   | 7,353  |   |   |   | 5,869  |   |    |   | (1,484 | )      |
| Total research and development expense    |   | $                                | 2,837  |                           |    | $      | 2,438  |   |   | $      | (399      | )      |    | $      | 9,579  |   |   | $      | 7,921  |   |    | $      | (1,658 | )      |

----

| ·   | the number of sites included in the trials; |
|--------------------|---------------------------------------------|

| ·   | the length of time required to enroll suitable patients; |
|--------------------|----------------------------------------------------------|

| ·   | the number of patients that participate in the trials; |
|--------------------|--------------------------------------------------------|

| ·   | the duration of patient follow-up; |
|--------------------|------------------------------------|

| ·   | the development stage of the product candidate; and |
|--------------------|-----------------------------------------------------|

| ·   | the efficacy and safety profile of the product candidate. |
|--------------------|-----------------------------------------------------------|

|                                           |   |                             |   |                           |         |   |   |   |   |   |   |   |         |   |   |   |   |   |   |   |         |   |   |   |
|------------------------------------------------|--------|----------------------------------|--------|--------------------------------|--------------|--------|--------|--------|--------|--------|--------|--------|--------------|--------|--------|--------|--------|--------|--------|--------|--------------|--------|--------|--------|
|                                           |   | Three months ended September 30, |   | Nine months endedSeptember 30, |
|                                           |   | 2011                             |   | 2012                           |         | Change |   | 2011   |   | 2012   |   | Change |
| Compensation and related expense               |   | $                                | 1,395  |                           |    | $      | 1,069  |   |   | $      | (326   | )      |    | $      | 4,975  |   |   | $      | 3,402  |   |    | $      | (1,573 | )      |
| External services – direct third parties |   |                             | 685    |                           |    |   | 720    |   |   |   | 35     |   |    |   | 2,226  |   |   |   | 2,052  |   |    |   | (174   | )      |
| External services – other                |   |                             | 125    |                           |    |   | 76     |   |   |   | (49    | )      |    |   | 270    |   |   |   | 462    |   |    |   | 192    |   |
| Research materials and related expense         |   |                             | 207    |                           |    |   | 320    |   |   |   | 113    |   |    |   | 762    |   |   |   | 1,012  |   |    |   | 250    |   |
| Facilities and related expense                 |   |                             | 425    |                           |    |   | 253    |   |   |   | (172   | )      |    |   | 1,346  |   |   |   | 993    |   |    |   | (353   | )      |
| Total research and development expense         |   | $                                | 2,837  |                           |    | $      | 2,438  |   |   | $      | (399   | )      |    | $      | 9,579  |   |   | $      | 7,921  |   |    | $      | (1,658 | )      |

----

|                                     |   | Three months ended September 30, |   | Nine months endedSeptember 30, |
|------------------------------------------|--------|----------------------------------|--------|--------------------------------|
|                                     |   | 2011                             |   | 2012                           |   | Change |   | 2011 |   | 2012 |   | Change |
| Compensation and related expense         |   | $                                | 739    |                           |    | $ | 541 |   |   | $ | (198 | ) |   | $ | 3,240 |   |   | $ | 1,695 |   |    | $ | (1,545 | ) |
| Professional fees                        |   |                             | 520    |                           |    |   | 459 |   |   |   | (61 | ) |   |   | 1,506 |   |   |   | 1,722 |   |    |   | 248 |   |
| Facilities and related expense           |   |                             | 56     |                           |    |   | 83 |   |   |   | 27 |   |   |   | 227 |   |   |   | 374 |   |    |   | 147 |   |
| Insurance, travel and other expenses     |   |                             | 68     |                           |    |   | 115 |   |   |   | 47 |   |   |   | 224 |   |   |   | 226 |   |    |   | 2 |   |
| Total general and administrative expense |   | $                                | 1,383  |                           |    | $ | 1,198 |   |   | $ | (185 | ) |   | $ | 5,197 |   |   | $ | 4,017 |   |    | $ | (1,148 | ) |

----

| Issue                                           |   | Year   |            |   | Number of Shares |   |      |   | Net Proceeds(in thousands) (1) |   |
|-------------------------------------------------|--------|--------|-----------------|--------|------------------|--------|-----------|--------|-------------------------------------|--------|
| Series A Redeemable Convertible Preferred Stock |   |   | 2004, 2005 |   |             |   | 166,832   | (2)    |                                |   | $ | 38,910 |   |
| Series B Redeemable Convertible Preferred Stock |   |   | 2006            |   |             |   | 190,601   | (2)    |                                |   |   | 50,040 |   |
| Series C Redeemable Convertible Preferred Stock |   |   | 2007, 2008      |   |             |   | 207,764   | (2)    |                                |   |   | 54,571 |   |
| Initial Public Offering                         |   |   | 2010            |   |             |   | 600,000   |   |                                |   |   | 25,721 |   |
| Private Placement                               |   |   | 2011            |   |             |   | 1,107,939 |   |                                |   |   | 28,941 |   |
|                                            |   |   |            |   |             |   | 2,273,136 |   |                                |   | $ | 198,183 |   |

----

| (1) | Net proceeds represent gross proceeds received net of transaction costs associated with each equity offering. |
|-----|---------------------------------------------------------------------------------------------------------------|

| (2) | Number of shares represents the number of shares of common stock into which each series of preferred stock converted at the time of our initial public offering. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   |
|--------|--------|

----

|                                  |   |                            |    |   |   |   |    |   |   |   |    |   |
|---------------------------------------|--------|---------------------------------|---------|--------|--------|--------|---------|--------|--------|--------|---------|--------|
|                                  |   | Nine months ended September 30, |
|                                  |   | 2011                            |    | 2012   |   | Change |
| Statement of Cash Flows Data:         |   |                            |    |   |   |   |    |   |   |   |    |   |
| Total cash provided by (used in):     |   |                            |    |   |   |   |    |   |   |   |    |   |
| Operating activities                  |   | $                               | (17,172 | )      |   | $      | (13,399 | )      |   | $      | 3,773   |   |
| Investing activities                  |   |                            | (11,164 | )      |   |   | 6,044   |   |   |   | 17,208  |   |
| Financing activities                  |   |                            | 25,627  |   |   |   | (515    | )      |   |   | (26,142 | )      |
| Decrease in cash and cash equivalents |   | $                               | (2,709  | )      |   | $      | (7,870  | )      |   | $      | (5,161  | )      |

Item 3.                      Quantitative and Qualitative Disclosures About Market Risk.

Item 4.                      Controls and Procedures.

----

Legal Proceedings.

| ·   | the scope and results of our clinical trials, particularly regarding the number of patients required and the required duration of follow-up for our clinical trials in support of our product candidates; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the scope and results of our research and preclinical development programs; |
|--------------------|-----------------------------------------------------------------------------|

| ·   | the costs of operating our research and development facility to support our research and early clinical activities; |
|--------------------|---------------------------------------------------------------------------------------------------------------------|

| ·   | the time, complexity and costs involved in obtaining marketing approvals for our product candidates, which could take longer and be more costly than obtaining approval for a new conventional drug candidate, given the FDA’s limited experience with clinical trials and marketing approval for products derived from a patient’s own cells; |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the costs of securing commercial manufacturing capacity to support later-stage clinical trials and subsequent commercialization activities, if any; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the costs of maintaining, expanding, protecting and enforcing our intellectual property portfolio, including potential dispute and litigation costs and any associated liabilities and potentially challenging the intellectual property of others; |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | the costs of entering new markets outside the United States; and |
|--------------------|------------------------------------------------------------------|

| ·   | the extent of our contractual obligations and amount of debt service payments we are obligated to make. |
|--------------------|---------------------------------------------------------------------------------------------------------|

----

| ·   | make it difficult for us to obtain any necessary financing in the future; |
|--------------------|---------------------------------------------------------------------------|

| ·   | limit our flexibility in planning for or reacting to changes in our business; |
|--------------------|-------------------------------------------------------------------------------|

| ·   | reduce funds available for use in our operations; |
|--------------------|---------------------------------------------------|

| ·   | impair our ability to incur additional debt because of financial and other restrictive covenants or the liens on our assets which secure our current debt; |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | hinder our ability to raise equity capital because in the event of a liquidation of the business, debt holders receive a priority before equity holders; |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | make us more vulnerable in the event of a downturn in our business; or |
|--------------------|------------------------------------------------------------------------|

| ·   | place us at a possible competitive disadvantage relative to less leveraged competitors and competitors that have better access to capital resources. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

Unregistered Sales of Equity Securities and Use of Proceeds.

| Period                                       |   | Total Number of Shares Purchased |         | Average Price Paid per Share |    |
|----------------------------------------------|--------|----------------------------------|--------------|------------------------------|---------|
| January 1, 2012 – January 31, 2012     |   | —                          |    | $                            | — |   |
| February 1, 2012 – February 29, 2012   |   | 878                              |    |                         | 6.10    |   |
| March 1, 2012 – March 31, 2012         |   | —                          |    |                         | — |   |
| April 1, 2012 – April 30, 2012         |   | —                          |    |                         | — |   |
| May 1, 2012 – May 31, 2012             |   | —                          |    |                         | — |   |
| June 1, 2012 – June 30, 2012           |   | —                          |    |                         | — |   |
| July 1, 2012 – July 31, 2012           |   | —                          |    |                         | — |   |
| August 1, 2012 – August 31, 2012       |   | —                          |    |                         | — |   |
| September 1, 2012 – September 30, 2012 |   | —                          |    |                         | — |   |
| Total                                        |   | 878                              |         | $                            | 6.10    |   |

Defaults Upon Senior Securities

Mine and Safety Disclosures

Other Information

----

Exhibits

| Exhibit Number | Description                                                                                                                                                                                                                                                                                         |
|----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  3.1      | Certificate of Amendment to the Fourth Amended and Restated Certificate of Incorporation, effective 12:01 a.m. June 14, 2012 (Incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on June 5, 2012)                                                     |
| 4.1            | Form of Demand Note issued September 7, 2012 (Incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on September 11, 2012)                                                                                                                               |
| 4.2            | Form of Senior Secured Convertible Note issued October 2, 2012 (Incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on October 4, 2012)                                                                                                                |
| 4.3            | Form of Warrant issued October 2, 2012 (Incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed on October 4, 2012)                                                                                                                                        |
| 4.4            | Amended and Restated Secured Promissory Note issued as of September 1, 2012(Incorporated by reference to Exhibit 4.3 to the Company’s Current Report on Form 8-K filed on October 4, 2012)                                                                                                    |
| 10.1           | Securities Purchase Agreement by and between Tengion, Inc. and the investors party thereto, dated October 2, 2012 (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on October 4, 2012)                                                            |
| 10.2           | Facility Agreement by and between Tengion, Inc. and the lenders party thereto, dated October 2, 2012 (Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on October 4, 2012)                                                                         |
| 10.3           | Security Agreement by and between Tengion, Inc. and the secured parties thereto, dated October 2, 2012 (Incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on October 4, 2012)                                                                       |
| 10.4           | Registration Rights Agreement by and between Tengion, Inc. and the parties thereto, dated October 2, 2012 (Incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K filed on October 4, 2012)                                                                    |
| 10.5           | Escrow Agreement by and between Tengion, Inc., Ballard Spahr LLP as escrow agent, and the parties thereto, dated October 2, 2012 (Incorporated by reference to Exhibit 10.5 to the Company’s Current Report on Form 8-K filed on October 4, 2012)                                             |
| 10.6           | Right of First Negotiation Agreement by and between Tengion, Inc. and Celgene Corporation, dated October 2, 2012 (Incorporated by reference to Exhibit 10.6 to the Company’s Current Report on Form 8-K filed on October 4, 2012)                                                             |
| 10.7           | First Amendment of Venture Loan and Security Agreement by and between Tengion, Inc., Horizon Credit II LLC and Horizon Technology Finance Corporation, dated October 2, 2012 (Incorporated by reference to Exhibit 10.7 to the Company’s Current Report on Form 8-K filed on October 4, 2012) |
| 10.8           | Joinder Agreement by and between Tengion, Inc. and Horizon Credit II LLC, dated October 2, 2012 (Incorporated by reference to Exhibit 10.8 to the Company’s Current Report on Form 8-K filed on October 4, 2012)                                                                              |
| 10.9           | Termination Agreement by and between Tengion, Inc. and Medtronic, Inc., dated October 2, 2012 (Incorporated by reference to Exhibit 10.9 to the Company’s Current Report on Form 8-K filed on October 4, 2012)                                                                                |

| 31.1   | Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 31.2   | Certification of Principal Financial and Accounting Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| 32.1   | Certification of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 32.2   | Certification of Principal and Financial Accounting Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 101    | The following materials for the quarter ended September 30, 2012, formatted in XBRL (eXtensible Business Reporting Language): (i) the  Balance Sheets, (ii)  Statements of Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit), (iii) the  Statements of Operations, (iv) the  Statements of Cash Flows, and (v) Notes to  Financial Statements. Such materials were previously filed or furnished on Registrant's Quarterly Report on Form 10-Q filed on November 14, 2012.** |
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |

|   | ** | Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 are deemed not filed as part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections. |
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SIGNATURES

|                                   |   | TENGION, INC. |
|----------------------------------------|--------|---------------|
|                                   |   |          |   |   |
|                                   |   |          |   |   |
| Date:  February 8, 2013      |   | By:           | /s/ John L. Miclot |
|                                   |   |          |   | John L. MiclotPresident and Chief Executive Officer(Principal Executive Officer) |
|                                   |   |          |   |   |
|                                   |   |          |   |   |
| Date:  February 8, 2013 |   | By:           | /s/ A. Brian Davis |
|                                   |   |          |   | A. Brian DavisChief Financial Officer and Vice President, Finance(Principal Financial and Accounting Officer) |
|                                   |   |          |   |   |

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