##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-K
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2010
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission File No. 001-32157
 ADVENTRX Pharmaceuticals, Inc.
 (Exact name of registrant as specified in its charter)
 Delaware
    
    84-1318182(State or other jurisdiction of incorporation or organization)
    
    (I.R.S. Employer Identification No.)12390 El Camino Real, Ste 150, San Diego, CA
    
    92130(Address of principal executive offices)
    
    (Zip Code)
 (858) 552-0866  (Registrants telephone number, including area code)
  Title of each class:
    
    Name of each exchange on which registered:Common Stock, par value $0.001 per share
    
    NYSE Amex LLC
 None
 Yes o No þ
 Yes o No þ
 Yes þ No o
 Yes o No o
 þ
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company þ
 Yes o No þ




---



##### 



Table of Contents
 PageForward-Looking Statements
    
    
    iPART I
    
    
    1Item 1. Business
    
    
    1Item 1A. Risk Factors
    
    
    21Item 1B. Unresolved Staff Comments
    
    
    48Item 2. Properties
    
    
    48Item 3. Legal Proceedings
    
    
    48Item 4. (Removed and Reserved)
    
    
    48PART II
    
    
    49Item 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
    
    
    49Item 6. Selected Financial Data
    
    
    50Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    50Item 7A. Quantitative and Qualitative Disclosures About Market Risk
    
    
    61Item 8. Financial Statements and Supplementary Data
    
    
    61Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
    
    
    61Item 9A. Controls and Procedures
    
    
    61Item 9B. Other Information
    
    
    62PART III
    
    
    63Item 10. Directors, Executive Officers and Corporate Governance
    
    
    63Item 11. Executive Compensation
    
    
    63Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
    
    
    63Item 13. Certain Relationships and Related Transactions, and Director Independence
    
    
    63Item 14. Principal Accounting Fees and Services
    
    
    63PART IV
    
    
    63Item 15. Exhibits, Financial Statement Schedules
    
    
    63SIGNATURES
    
    
    70Exhibit 21.1Exhibit 23.1Exhibit 31.1Exhibit 31.2Exhibit 32.1




---



##### Table of Contents



Forward-Looking Statements
 This Annual Report on Form 10-K , particularly in Item 1 Business, and Item 7 Managements
Discussion and Analysis of Financial Condition and Results of Operations, and the information
incorporated herein by reference, include forward-looking statements within the meaning of Section
27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended. All statements, other than statements of historical fact, are statements that
could be deemed forward-looking statements, including, but not limited to, statements regarding our
business strategy, expectations and plans, our objectives for future operations and our future
financial position. When used in this report, the words believe, may, could, will,
estimate, continue, anticipate, intend, expect, indicate, seek, should or would
and similar expressions are intended to identify forward-looking statements. Among the factors
that could cause or contribute to material differences between our actual results and those
indicated from the forward-looking statements are risks and uncertainties inherent in our business,
including, but are not limited to: the extent to which we acquire new technologies, product
candidates, products or businesses and our ability to integrate them successfully into our
operations; our ability, or that of a future partner, to obtain regulatory approval for our product
candidates and, if approved, to successfully commercialize them in the U.S. and/or elsewhere; our
ability to obtain stockholder approval of the issuance of milestone-related shares in connection
with our acquisition of SynthRx, Inc. on a timely basis, or at all; our ability to obtain
stockholder approval to complete any other product pipeline expansion transaction, if necessary, on
a timely basis, or at all; the potential that we may enter into a merger or other business
combination whereby the stockholders who own the majority of our voting securities prior to the
transaction own less than a majority after the transaction; our ability to obtain additional
funding on a timely basis or on acceptable terms, or at all; the potential that we may enter into
one or more commercial partnerships or other strategic transactions relating to Exelbine and/or
ANX-514, and the terms of any such transactions; the extent to which we rebuild our workforce and
our ability to attract and retain qualified personnel and manage growth; our ability to develop
sales, marketing and distribution capabilities to launch Exelbine, should we obtain regulatory
approval to market it, and any other current or future product candidate, should we obtain
regulatory approval to market any of them and determine to commercialize any of them without a
partner; delays in the commencement or completion of nonclinical testing, bioequivalence or
clinical trials of or manufacturing, regulatory or launch activities related to our product
candidates; the success of future bioequivalence or clinical trials; whether any of our product
candidates for which we receive regulatory approval, if any, achieve broad market acceptance;
competition in the marketplace for our products, if any are approved; our ability to maintain our
relationships with the single source manufacturers and suppliers for certain of our product
candidates and their component materials and the ability of such manufacturers and suppliers to
successfully and consistently manufacture and supply, as applicable, our products and their
component materials on a commercial scale, if we receive regulatory approval to commercialize our
product candidates; the satisfactory performance of third parties on whom we rely significantly to
conduct our nonclinical testing and bioequivalence and clinical studies and other aspects of our
development programs; undesirable side effects that our product candidates may cause; our ability
to protect our intellectual property rights with respect to our product candidates and proprietary
technology; claims against us for infringing the proprietary rights of third parties; healthcare
reform measures and reimbursement policies that, if not favorable to our products, could hinder or
prevent our products commercial success; potential product liability exposure and, if successful
claims are brought against us, liability for a product or product candidate; our ability to
maintain compliance with NYSE Amex continued listing standards and maintain the listing of our
common stock on the NYSE Amex or another national securities exchange; and and other risks and
uncertainties described in Part I, Item 1A Risk Factors of this report.
 We have based the forward-looking statements we make on our current expectations and
projections about future events and trends that we believe may affect our financial condition,
results of operations, business strategy, short-term and long-term business operations and
objectives, and financial needs. In light of these risks and uncertainties and our assumptions,
the forward-looking events and circumstances discussed in this report and in the information
incorporated herein by reference may not occur. We cannot guarantee future results, events, levels
of activity, performance or achievement. Accordingly, you are cautioned not to place undue
reliance on forward-looking statements. Except as required by law, we do not intend to update the
forward-looking statements discussed in this report publicly or to update the reasons actual
results could differ materially from those anticipated in these forward-looking statements, even if
new information becomes available in the future.
  -i-




---



##### Table of Contents



PART I
 
 Item 1.
    
    Business.
 Overview
  ® ®
    Pending Acquisition of SynthRx, Inc.
   -1-




---



##### Table of Contents



Business Strategy
  
    
    Acquire SynthRx and pursue development of purified 188. We expect to consummate our
acquisition of SynthRx in the first half of 2011. We initially intend to develop
SynthRxs lead product candidate, purified 188, for the treatment of sickle cell crisis
in a pediatric population. If we consummate our acquisition of SynthRx and we are able
to reach agreement with the FDA on a study protocol on a timely basis, we may initiate
a phase 3 clinical trial of purified 188 for that indication in 2012.
 
    
    Seek regulatory approval for Exelbine in the U.S.In November 2010, we submitted an
NDA for Exelbine to the FDA, and in January 2011, we announced that the FDA accepted
the Exelbine NDA for filing and established a PDUFA goal date of September 1, 2011 to
finish its review of the Exelbine NDA. We plan to work with the FDA to the extent
possible to move Exelbine toward approval.
 
    
    Reach agreement with FDA regarding a phase 3 safety study for ANX-514.Based on our
February 2011 meeting with the FDA to discuss ANX-514, we believe a single, additional,
randomized, phase 3 safety study could support FDA approval of ANX-514. We are
developing a study protocol for submission to the FDA and intend to continue
discussions with the FDA regarding requirements for regulatory approval of ANX-514.
 
    
    Establish sales and marketing capabilities in the U.S.The oncology marketplace in
general, and the anticipated target audience for Exelbine in particular, is
concentrated. We believe a meaningful portion of the potential U.S. market for Exelbine
can be accessed through an experienced sales force that targets key constituents of the
treatment/product-selection decision-making process. In addition, we will evaluate
opportunities to leverage an existing sales force by adding complementary products with
a similar target audience. We have undertaken and expect to continue to undertake
activities to prepare for the commercial launch of Exelbine, including developing
and/or acquiring certain internal sales, distribution and marketing and associated
regulatory compliance capabilities and contracting with third parties to supplement and
enhance our internal capabilities. However, we remain receptive to partnering Exelbine
in the U.S. if presented with terms that we believe would increase its value for our
stockholders.
 
    
    Acquire, develop and commercialize additional product candidates, products and/or
capabilities.We continue to evaluate opportunities to expand our product pipeline and
believe that, due to a challenging capital raising environment, many drug development
programs with substantial potential are available at attractive valuations. We may also
seek to acquire currently-marketed products that could complement our portfolio and
provide a sales and marketing platform for our existing or future product candidates.
 
    
    Pursue additional indications and commercial opportunities for our product
candidates independently and through collaborations.We may increase the value of our
product candidates by seeking approval for label changes and pursuing other commercial
opportunities. For example, beyond sickle cell disease, we believe purified 188 may
have clinical benefits in other acute events related to microvascular-flow
abnormalities, such as heart attack, stroke and hemorrhagic shock.
 Opportunities in Cancer Therapy
   -2-




---



##### Table of Contents



Our Novel Emulsion Formulations
 Background and Opportunity
   Commercialization
   HCPCS Product Codes and Reimbursement
     -3-




---



##### Table of Contents



Exelbine (vinorelbine injectable emulsion)
 Background; Limitations of Current Vinorelbine Formulations
    Exelbine New Drug Application
    -4-




---



##### Table of Contents



Market and Opportunity
    FDA Acceptance of Brand Name Exelbine
   -5-




---



##### Table of Contents



ANX-514 (docetaxel emulsion for injection)
 Background; Limitations of Taxotere
      Potential Benefits of ANX-514
    -6-




---



##### Table of Contents



Journal of the National Cancer Institute
 Nonclinical Efficacy and Safety
   Planned Phase 3 Clinical Study
     -7-




---



##### Table of Contents



Development Outside the U.S.
  Potential New Opportunity  Purified Poloxamer 188
 Background
    Sickle Cell: Clinical History; Planned Phase 3 Clinical Study
     -8-




---



##### Table of Contents



Sickle Cell: Market and Opportunity
   Competition
   Exelbine and ANX-514
   ®
  -9-




---



##### Table of Contents



Purified 188 for Sickle Cell Crisis
    Manufacturing
    -10-




---



##### Table of Contents



Intellectual Property
 Exelbine (vinorelbine injectable emulsion)
  ANX-514 (docetaxel emulsion for injection)
   Purified 188 for Sickle Cell Crisis
   -11-




---



##### Table of Contents



Trademarks
 ® ®
 Research and Development
   -12-




---



##### Table of Contents



Licensing Agreements
 SD Pharmaceuticals
  
    
    For Exelbine, vinca alkaloid intravenous emulsion formulation for cancer
treatment and any other disease indication.
 
    
    For ANX-514, docetaxel intravenous emulsion formulation for cancer treatment
and any other disease indication.
 CytRx Corporation
   Material Terms of the Pending Acquisition of SynthRx
   -13-




---



##### Table of Contents



Prior Cost-Containment and Fundraising Activities
 ®
  -14-




---



##### Table of Contents



Government Regulations
   FDA Approval Process
    -15-




---



##### Table of Contents



Section 505(b)(2) New Drug Applications
   -16-




---



##### Table of Contents



Orphan Drug Designation
   Fast Track Designation
   -17-




---



##### Table of Contents



Priority Review
  Pediatric Exclusivity
   Other Regulatory Requirements
   -18-




---



##### Table of Contents



-19-




---



##### Table of Contents



Employees
   Formation
   -20-




---



##### Table of Contents



Item 1A.
    
    Risk Factors.
  RISKS RELATED TO OUR BUSINESS
 Risks Related to Our Capital Requirements, Finances and Operations
 We have incurred losses since our inception, we expect our operating expenses to continue to exceed
our revenues for the foreseeable future and we may never generate revenues sufficient to achieve
profitability.
  The success of our business currently is dependent primarily on the success of Exelbine and ANX-514
and these product candidates may not receive regulatory approval or be successfully commercialized.
    -21-




---



##### Table of Contents



Our financial resources are limited, we will need to obtain additional funding to pursue our
current business strategy and we may not be able to obtain such funding on a timely basis or on
commercially reasonable terms, if at all.
   
    
    the costs of seeking regulatory approval for our product candidates, including
any nonclinical testing or bioequivalence or clinical studies, process development,
scale-up and other manufacturing and stability activities, or other work required
to achieve such approval, as well as the timing of such activities and approval;
 
    
    the extent to which we invest in or acquire new technologies, product
candidates, products or businesses and the development requirements with respect to
any acquired programs;
 
    
    the scope, prioritization and number of development and/or commercialization
programs we pursue and the rate of progress and costs with respect to such
programs;
 
    
    the costs related to developing, acquiring and/or contracting for sales,
marketing and distribution capabilities and regulatory compliance capabilities,
most immediately with respect to Exelbine, if we commercialize any of our product
candidates for which we obtain regulatory approval without a partner;
 
    
    the timing and terms of any collaborative, licensing and other strategic
arrangements that we may establish;
 
    
    the extent to which we will need to rebuild our workforce, which currently
consists of four employees, and the costs involved in recruiting, training and
incentivizing new employees;
 
    
    the effect of competing technological and market developments; and
 
    
    the cost involved in establishing, enforcing or defending patent claims and
other intellectual property rights.
   -22-




---



##### Table of Contents



If we consummate the SynthRx acquisition and if our stockholders fail to approve the issuance of
the shares of our common stock issuable upon the achievement of milestones related to development
and regulatory approval of purified 188, our future liquidity and cash position could be materially
impaired, which could have an immediate negative effect on our stock price and require us to raise
additional capital.
      -23-




---



##### Table of Contents



Our ability to raise capital may be limited by applicable laws and regulations.
      -24-




---



##### Table of Contents



Our ability to raise capital may be limited by contractual restrictions.
  Raising additional capital may cause dilution to our existing stockholders, require us to
relinquish proprietary rights or restrict our operations.
  We currently expect to increase the size of our organization, and may experience difficulties in
attracting and retaining qualified personnel and managing growth.
   -25-




---



##### Table of Contents



We may not be able to manage our business effectively if we are unable to retain key personnel.
  If we are unable to raise sufficient additional capital as needed, we may be forced to reduce our
current and/or planned development and commercialization activities, partner our product candidates
or products at inopportune times or pursue less expensive but higher-risk development paths, which
we have done in the past.
   -26-




---



##### Table of Contents



Our failure to successfully acquire, develop and commercialize additional technologies, product
candidates and/or products may impair our ability to grow.
    If we acquire or acquire rights to new technologies, product candidates and/or products and fail to
integrate them successfully into our operations, we may incur unexpected costs and disruptions to
our business.
  
    
    exposure to unknown liabilities;
 
    
    disruption of our business and diversion of our managements time and attention
to develop and/or commercialize acquired technologies, products candidates and/or
products;
 
    
    incurrence of substantial debt or dilutive issuances of securities to pay for
acquisitions;
 
    
    higher than expected acquisition and integration costs;
  -27-




---



##### Table of Contents




    
    increased amortization expenses;
 
    
    difficulty and cost in combining the operations and personnel of any acquired
businesses with our operations and personnel;
    
    impairment of relationships with key suppliers and/or customers of any acquired
businesses due to changes in management and ownership; and
 
    
    inability to retain key employees of any acquired businesses.
  The use of our net operating loss carry forwards and research and development tax credits has been
and may be limited further by changes in ownership within the meaning of IRC Section 382.
   If we fail to maintain an effective system of internal control over financial reporting and
disclosure controls and procedures, we may not be able to accurately report our financial results.
As a result, current and potential investors could lose confidence in our financial reporting,
which could harm our business and have an adverse effect on our stock price.
   -28-




---



##### Table of Contents



Our operations might be interrupted by the occurrence of a natural disaster or other catastrophic
event.
  Risks Related to Drug Development and Commercialization
 Further testing and/or validation of our product candidates and related manufacturing processes may
be required and regulatory approval may be delayed or denied, which would limit or prevent us from
marketing our product candidates and significantly impair our ability to generate revenues.
   -29-




---



##### Table of Contents



We may not achieve our projected development, commercialization and other goals in the time frames
we announce. Delays in the commencement or completion of nonclinical testing, bioequivalence or
clinical trials or manufacturing, regulatory or other activities could result in increased costs to
us and delay or limit our ability to generate revenues.
   -30-




---



##### Table of Contents




    
    delays in reaching agreement on acceptable terms with prospective contract
research organizations, or CROs, and contract manufacturing organizations, or CMOs,
the terms of which can be subject to extensive negotiation and may vary
significantly among different CROs and CMOs;
 
    
    failures on the part of our CROs and CMOs in developing procedures and protocols
or otherwise conducting activities on timeframes requested by us;
 
    
    delays in identifying and hiring or engaging, as applicable, additional
employees or consultants to assist us in managing CRO and/or CMO activities;
 
    
    changes in regulatory requirements or other standards or guidance relating to
nonclinical testing, including testing of pharmaceutical products in animals;
 
    
    a lack of availability of capacity at our CMOs, or of the component materials,
including the active pharmaceutical ingredient, or API, or related materials,
including vials and stoppers, necessary to manufacture our product candidates or
products; and
 
    
    unforeseen results of nonclinical testing that require us to amend study or test
designs or delay future testing or bioequivalence or clinical trials and related
regulatory filings.
  
    
    obtaining regulatory approval to commence a trial;
 
    
    identifying appropriate trial sites and reaching agreement on acceptable terms
with prospective CROs, trial sites and investigators, the terms of which can be
subject to extensive negotiation and may vary significantly among different CROs,
trial sites and investigators;
 
    
    identifying and hiring or engaging, as applicable, additional employees or
consultants to assist us in managing a trial and analyzing the data resulting from
a trial;
 
    
    manufacturing sufficient quantities of a product candidate;
 
    
    obtaining institutional review board, or IRB, approval to conduct a trial at a
prospective site;
 
    
    recruiting and enrolling patients to participate in trials for a variety of
reasons, including competition from other clinical trials for the same indication
as our product candidates and the perception that the design of a trial or the
proposed treatment regimen is less beneficial to patients than available
alternatives; and
 
    
    retaining patients who have initiated a trial but may be prone to withdraw due
to side effects from the therapy, lack of efficacy, improvement in condition before
treatment has been completed or personal issues, or who are lost to further
follow-up.
   -31-




---



##### Table of Contents




    
    failure to conduct the trial in accordance with regulatory requirements or the
trials protocol;
 
    
    inspection of trial operations or trial sites by the FDA or other regulatory
authorities resulting in the imposition of a clinical hold;
 
    
    unforeseen safety issues; or
 
    
    lack of adequate funding to continue the trial.
    -32-




---



##### Table of Contents



Positive results in nonclinical testing, bioequivalence trials and/or clinical trials do not ensure
that future bioequivalence or clinical trials will be successful or that our product candidates
will receive the regulatory approvals necessary for their commercialization.
     -33-




---



##### Table of Contents



We currently have no sales or marketing capability and our failure to acquire or develop these and
related capabilities internally or contract with third parties to perform these activities
successfully could delay and/or limit our ability to generate revenues in the event one or more of
our product candidates obtains regulatory approval.
   If any of our product candidates for which we receive regulatory approval do not achieve broad
market acceptance (including as a result of our inability to differentiate our products from
competitor products or promote any such differences or as a result of failing to obtain
reimbursement rates for our products that make our products competitive from the healthcare
providers perspective), the revenues we generate from their sales will be limited and our business
may not be profitable.
  
    
    our products perceived advantages over existing treatment methods (including
relative convenience and ease of administration and prevalence and severity of any
adverse side effects);
 
    
    claims or other information (including limitations or warnings) in our products
approved labeling;
 
    
    the resources we devote to marketing our product and restrictions on promotional
claims we can make with respect to the product;
 
    
    reimbursement and coverage policies of government and other third-party payors;
 
    
    pricing and cost-effectiveness;
 
    
    in the U.S., the ability of group purchasing organizations (including
distributors and other network providers) to sell our product to their
constituencies;
 
    
    the establishment and demonstration in the medical community of the safety and
efficacy of our product and our ability to provide acceptable evidence of safety
and efficacy;
    
    availability of alternative treatments; and
 
    
    the prevalence of off-label substitution of chemically equivalent products or
alternative treatments.
  -34-




---



##### Table of Contents



We do not have manufacturing capabilities and are dependent on single source manufacturers and
suppliers for certain of our product candidates and their component materials, and the loss of any
of these manufacturers or suppliers, or their failure to provide us with an adequate supply of
products or component materials on commercially acceptable terms, or at all, could harm our
business.
   -35-




---



##### Table of Contents



-36-




---



##### Table of Contents



We rely significantly on third parties to conduct our nonclinical testing and bioequivalence and
clinical studies and other aspects of our development programs and if those third parties do not
satisfactorily perform their contractual obligations or meet anticipated deadlines, the development
of our product candidates could be adversely affected.
     -37-




---



##### Table of Contents



If we receive regulatory approval for one or more of our product candidates, we may face
competition from generic products, which could exert downward pressure on the pricing and market
share of our products and limit our ability to generate revenues.
  If we receive regulatory approval for one or more of our product candidates, we may face
competition for our products from lower priced products from foreign countries that have placed
price controls on pharmaceutical products.
  Even if we receive regulatory approval for one or more of our product candidates, they may still
face future development and regulatory difficulties that could materially and adversely affect our
business, financial condition and results of operations and cause our stock price to decline.
  
    
    issue warning letters or untitled letters;
 
    
    impose civil or criminal penalties;
 
    
    suspend or withdraw regulatory approval;
 
    
    suspend or terminate any ongoing bioequivalence or clinical trials;
 
    
    refuse to approve pending applications or supplements to approved applications;
 
    
    exclude our product from reimbursement under government healthcare programs,
including Medicaid or Medicare;
 
    
    impose restrictions or affirmative obligations on our or our CMOs operations,
including costly new manufacturing requirements;
 
    
    close the facilities of a CMO; or
 
    
    seize or detain products or require a product recall.
  -38-




---



##### Table of Contents



Even if one or more of our product candidates receive regulatory approval in the U.S., we may never
receive approval or commercialize our products outside of the U.S., which would limit our ability
to realize the full commercial potential of our product candidates.
  Our product candidates may cause undesirable side effects or have other properties that could delay
or prevent their regulatory approval or commercialization.
   
    
    regulatory authorities may require the addition of labeling statements, such as
a black box warning or a contraindication;
 
    
    regulatory authorities may withdraw their approval of the product;
 
    
    we may be required to change the way the product is administered, conduct
additional clinical trials or change the labeling of the product; and
 
    
    our reputation may suffer.
  Risks Related to Our Intellectual Property
 Our success will depend on patents and other protection we obtain on our product candidates and
proprietary technology.
  
    
    obtain and maintain patent and other exclusivity with respect to our products;
    
    prevent third parties from infringing upon our proprietary rights;
  -39-




---



##### Table of Contents




    
    maintain trade secrets;
 
    
    operate without infringing upon the patents and proprietary rights of others;
and
 
    
    obtain appropriate licenses to patents or proprietary rights held by third
parties if infringement would otherwise occur, both in the U.S. and in foreign
countries.
     Patent protection for our emulsion-formulation product candidates may be difficult to obtain and
any issued claims may be limited because of the nature of patent protection available for these
candidates.
   -40-




---



##### Table of Contents



If we are sued for infringing the proprietary rights of third parties, it will be costly and time
consuming, and an unfavorable outcome would have an adverse effect on our business.
    
    
    infringement and other intellectual property claims which, with or without
merit, may be expensive and time consuming to litigate and may divert our
managements attention from our core business;
 
    
    substantial damages for infringement, including the potential for treble damages
and attorneys fees, which we may have to pay if a court decides that the product
at issue infringes or violates the third partys rights;
 
    
    a court prohibiting us from selling or licensing the product unless the third
party licenses its product rights to us, which it may not be required to do;
 
    
    if a license is available from the third party, we may have to pay substantial
royalties, fees and/or grant cross-licenses to our products; and
 
    
    redesigning our products or processes so they do not infringe, which may not be
possible or may require substantial expense and time.
   -41-




---



##### Table of Contents



RISKS RELATED TO OUR INDUSTRY
 We expect intense competition in the marketplace for each of our products, if any of our product
candidates are approved.
    ®
  -42-




---



##### Table of Contents



We are subject to uncertainty relating to healthcare reform measures and reimbursement policies
that, if not favorable to our products, could hinder or prevent our products commercial success,
if any of our product candidates are approved.
  
    
    our ability to set a price we believe is fair for our products;
 
    
    our ability to generate revenues or achieve or maintain profitability;
 
    
    the future revenues and profitability of our potential customers, suppliers and
collaborators; and
 
    
    the availability to us of capital.
   -43-




---



##### Table of Contents



We face potential product liability exposure and, if successful claims are brought against us, we
may incur substantial liability for a product or product candidate and may have to limit its
commercialization. In the future, we anticipate that we will need to obtain additional or increased
product liability insurance coverage and it is uncertain that such increased or additional
insurance coverage can be obtained on commercially reasonable terms, if at all.
  
    
    decreased demand for our products;
 
    
    impairment of our business reputation;
 
    
    withdrawal of bioequivalence or clinical trial participants;
 
    
    costs of related litigation;
 
    
    substantial monetary awards to patients or other claimants;
 
    
    loss of revenues; and
 
    
    the inability to commercialize our products and product candidates.
   RISKS RELATED TO OUR COMMON STOCK
 If we are unable to maintain compliance with NYSE Amex continued listing standards, we may be
delisted from the NYSE Amex equities market, which would likely cause the liquidity and market
price of our common stock to decline.
   -44-




---



##### Table of Contents



If our common stock were delisted and determined to be a penny stock, a broker-dealer may find it
more difficult to trade our common stock and an investor may find it more difficult to acquire or
dispose of our common stock in the secondary market.
  The market price of our common stock historically has been and likely will continue to be highly
volatile.
  
    
    the level of our financial resources;
 
    
    announcements of entry into or consummation of a financing or strategic
transaction;
  -45-




---



##### Table of Contents




    
    changes in the regulatory status of our product candidates, including results of
any bioequivalence and clinical trials and other research and development programs;
 
    
    FDA or international regulatory actions and regulatory developments in the U.S.
and foreign countries;
 
    
    announcements of new products or technologies, commercial relationships or other
events (including bioequivalence and clinical trial results and regulatory events
and actions) by us or our competitors;
 
    
    market conditions in the pharmaceutical, biopharmaceutical, specialty
pharmaceutical and biotechnology sectors;
 
    
    developments concerning intellectual property rights generally or those of us or
our competitors;
 
    
    changes in securities analysts estimates of our financial performance or
deviations in our business and the trading price of our common stock from the
estimates of securities analysts;
 
    
    events affecting any future collaborations, commercial agreements and grants;
 
    
    fluctuations in stock market prices and trading volumes of similar companies;
 
    
    sales of large blocks of our common stock, including sales by our executive
officers, directors and significant stockholders or pursuant to shelf or resale
registration statements that register shares of our common stock that may be sold
by us or certain of our current or future stockholders;
 
    
    discussion of us or our stock price by the financial and scientific press and in
online investor communities;
 
    
    commencement of delisting proceedings by the NYSE Amex;
 
    
    additions or departures of key personnel; and
 
    
    changes in third-party payor reimbursement policies.
  Sales of substantial amounts of our common stock or the perception that such sales may occur could
cause the market price of our common stock to drop significantly, even if our business is
performing well.
   -46-




---



##### Table of Contents



If our acquisition of SynthRx closes, we may obtain voting control over a significant amount of our
outstanding common stock and we may determine to cause those shares to be voted in such a manner
that does not necessarily coincide with the interests of individual stockholders or particular
groups of stockholders.
  Anti-takeover provisions in our charter documents and under Delaware law may make an acquisition of
us, which may be beneficial to our stockholders, more difficult, which could depress our stock
price. Alternatively, prohibitions on anti-takeover provisions in our charter documents may
restrict us from acting in the best interests of our stockholders.
    -47-




---



##### Table of Contents



Because we do not expect to pay dividends with respect to our common stock in the foreseeable
future, you must rely on stock appreciation for any return on your investment.
  
 Item 1B.
    
    Unresolved Staff Comments.
  
 Item 2.
    
    Properties.
  
 Item 3.
    
    Legal Proceedings.
  
 Item 4.
    
    (Removed and Reserved).
  -48-




---



##### Table of Contents



PART II
 
 Item 5.
    
    Market for Registrants Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities.
 Market Information
  Closing Sale Price2010
    
    
    2009High
    
    
    Low
    
    
    High
    
    
    LowFirst Quarter
    
    $
    11.67
    
    
    $
    5.00
    
    
    $
    4.50
    
    
    $
    2.25Second Quarter
    
    $
    6.80
    
    
    $
    1.61
    
    
    $
    5.50
    
    
    $
    2.76Third Quarter
    
    $
    2.11
    
    
    $
    1.53
    
    
    $
    5.00
    
    
    $
    3.00Fourth Quarter
    
    $
    2.99
    
    
    $
    1.93
    
    
    $
    10.75
    
    
    $
    2.25
  Dividend Policy
   Recent Sales of Unregistered Securities
  
    
    on June 12, 2009, warrants to purchase an aggregate of up to 36,071 shares of
our common stock at an exercise price of $3.75 per share, which warrants became
exercisable on December 13, 2009 and may be exercised any time on or before June
12, 2014;
 
    
    on July 6, 2009, warrants to purchase an aggregate of up to 19,007 shares of our
common stock at an exercise price of $4.475 per share, which warrants became
exercisable on January 7, 2010 and may be exercised any time on or before July 6,
2014;
  -49-




---



##### Table of Contents




    
    on August 10, 2009, warrants to purchase an aggregate of up to 14,183 shares of
our common stock at an exercise price of $4.0625 per share, which warrants became
exercisable on February 10, 2010 and may be exercised any time beginning on or
before August 10, 2014;
 
    
    on October 9, 2009, warrants to purchase an aggregate of up to 144,000 shares of
our common stock at an exercise price of $5.875 per share, which warrants became
exercisable on April 7, 2010 and may be exercised any time on or before October 6,
2014;
 
    
    on January 7, 2010, warrants to purchase an aggregate of up to 99,696 shares of
our common stock at an exercise price of $11.9125 per share, which warrants became
exercisable on July 7, 2010 and may be exercised any time on or before June 3,
2014; and
 
    
    on January 11, 2011, warrants to purchase an aggregate of up to 409,228 shares
of our common stock at an exercise price of $3.44 per share, which warrants were
exercisable upon issuance and may be exercised any time on or before April 1, 2015.
  
 Item 6.
    
    Selected Financial Data.
  
 Item 7.
    
    Managements Discussion and Analysis of Financial Condition and Results of
Operations.
 The following discussion and analysis of our financial condition and results of operations
should be read in conjunction with the consolidated financial statements and related notes
appearing elsewhere in this report. In addition to historical information, this discussion and
analysis contains forward-looking statements that involve risks, uncertainties, and assumptions.
Our actual results may differ materially from those anticipated in these forward-looking statements
as a result of certain factors, including but not limited to those identified under Item 1A Risk
Factors in this report.
 Overview
      -50-




---



##### Table of Contents



Recent Financings
  
    
    In January 2010, we completed a registered direct equity financing involving the
issuance of units consisting of shares of our 3.73344597664961% Series E
Convertible Preferred Stock, or Series E Stock, which were convertible into an
aggregate of 1,993,965 shares of our common stock, and 30-month warrants to
purchase up to an aggregate of 498,488 shares of our common stock. The gross
proceeds of this financing were $19.0 million, and we received $14.0 million in net
proceeds after deducting amounts deposited into escrow accounts to fund our
dividend and related payment
obligations in respect of the Series E Stock, the fees and expenses of our placement
agent, and our other offering expenses. All of the shares of our Series E Stock
have been converted into common stock and are no longer outstanding. We may receive
up to $4.4 million of additional proceeds from the exercise of the warrants issued
in this financing. Those warrants have an exercise price of $8.75 per share and are
exercisable any time on or before July 6, 2012, subject to certain beneficial
ownership limitations.
  -51-




---



##### Table of Contents




    
    In May 2010, we completed a registered direct equity financing involving the
issuance of units consisting of shares of our 2.19446320054018% Series F
Convertible Preferred Stock, or Series F Stock, which were convertible into an
aggregate of 5,190,312 shares of our common stock, 5-year warrants to purchase up
to an aggregate of 1,816,608 shares of our common stock and 1-year warrants to
purchase up to an aggregate of 778,548 shares of our common stock. The gross
proceeds of this financing were $19.2 million, and we received $13.3 million in net
proceeds after deducting amounts deposited into escrow accounts to fund our
dividend and related payment obligations in respect of the Series F Stock, the fees
and expenses of our placement agent and financial advisor, and our other offering
expenses. All of the shares of our Series F Stock have been converted into common
stock and are no longer outstanding. We may receive up to $9.5 million of
additional proceeds from the exercise of the warrants issued in this financing.
Those warrants have an exercise price of $3.65 per share. The 5-year warrants are
exercisable any time on or before May 6, 2015 and the 1-year warrants are
exercisable any time on or before May 20, 2011, subject to certain beneficial
ownership limitations.
 
    
    In January 2011, we completed a registered direct equity financing involving the
issuance of units consisting of 8,184,556 shares of our common stock, 5-year
warrants to purchase up to an aggregate of 2,046,139 shares of our common stock and
1-year warrants to purchase up to an aggregate of 2,046,139 shares of our common
stock. The gross proceeds of this financing were $22.5 million, and we received
$21.0 million in net proceeds after deducting the fees and expenses of our
placement agent and our other offering expenses. We may receive up to $11.3
million of additional proceeds from the exercise of the warrants issued in this
financing. Those warrants have an exercise price of $2.75 per share. The 5-year
warrants are exercisable any time on or before January 11, 2016 and the 1-year
warrants are exercisable any time on or before January 19, 2012, subject to certain
beneficial ownership limitations.
 Reverse Stock Split
  Critical Accounting Policies and Estimates
   -52-




---



##### Table of Contents



Revenue Recognition.
    R&D Expenses.
   Purchased In-Process Research and Development.
  -53-




---



##### Table of Contents



Share-based Compensation Expenses.
   Income Taxes.
  Costs Associated with Exit or Disposal Activities.
  -54-




---



##### Table of Contents



Convertible Instruments.
  Results of Operations
    
    
    the number of trials necessary to demonstrate the safety and efficacy of a product
candidate;
 
    
    the number of patients who participate in the trials;
  -55-




---



##### Table of Contents




    
    the number and location of sites included in trials and the rate of site approval
for the trial;
 
    
    the rates of patient recruitment and enrollment;
 
    
    the ratio of randomized to evaluable patients;
 
    
    the time and cost of process development activities related to our product
candidates;
 
    
    the costs of manufacturing our product candidates;
 
    
    with respect to bioequivalence or comparative trials, the availability and cost of
reference or control product in the jurisdiction of each site;
 
    
    the duration of patient treatment and follow-up;
 
    
    the time and cost of stability studies, including the need to identify critical
parameters, methods to evaluate and test these parameters and validation of such
methods and tests; and
 
    
    the costs, requirements, timing of and the ability to secure regulatory approvals.
     Operating ExpensesYears EndedDecember 31,2010
    
    
    2009Research and development
    
    
    41
    %
    
    
    56
    %Selling, general and administrative
    
    
    59
    %
    
    
    43
    %Depreciation and amortization
    
    
    0
    %
    
    
    1
    %Total operating expenses
    
    
    100
    %
    
    
    100
    %
  -56-




---



##### Table of Contents



Comparison of 2010 and 2009
 Revenue .
 R&D Expenses .
 January 1, 2005throughYears Ended December 31,
    
    
    December 31,2010
    
    
    2009
    
    
    2010External bioequivalence and clinical trial fees and expenses
    
    $
    215,486
    
    
    $
    603,097
    
    
    $
    24,018,062External nonclinical study fees and expenses (1)
    
    
    3,225,723
    
    
    
    5,083,474
    
    
    
    27,254,671Personnel costs
    
    
    253,298
    
    
    
    779,510
    
    
    
    10,543,996Share-based compensation expense
    
    
    (5,745
    )
    
    
    41,569
    
    
    
    2,919,985Total
    
    $
    3,688,762
    
    
    $
    6,507,650
    
    
    $
    64,736,714
 
 (1)
    
    External nonclinical study fees and expenses include preclinical, research-related
manufacturing, quality assurance and regulatory expenses.   Selling, General and Administrative Expenses.
  -57-




---



##### Table of Contents



Interest and Other Income/(Expense).
 Net Loss.
 Liquidity and Capital Resources
       -58-




---



##### Table of Contents



December 31,
    
    
    Increase
    
    
    December 31,2010
    
    
    During 2010
    
    
    2009Cash
    
    $
    27,978,823
    
    
    $
    19,311,419
    
    
    $
    8,667,404Net working capital
    
    $
    26,607,603
    
    
    $
    19,988,796
    
    
    $
    6,618,807
 Year Ended
    
    
    Change
    
    
    Year EndedDecember 31,
    
    
    Between
    
    
    December 31,2010
    
    
    Periods
    
    
    2009Net cash used in operating activities
    
    $
    (8,341,237
    )
    
    $
    4,275,179
    
    
    $
    (12,616,416
    )Net cash provided by (used in) investing activities
    
    
    (24,134
    )
    
    
    (40,134
    )
    
    
    16,000Net cash provided by financing activities
    
    
    27,676,790
    
    
    
    16,258,874
    
    
    
    11,417,916Net increase (decrease) in cash
    
    $
    19,311,419
    
    
    $
    20,493,919
    
    
    $
    (1,182,500
    )
 Operating activities .
 Investing activities .
 Financing activities .
 Management Outlook
   -59-




---



##### Table of Contents



-60-




---



##### Table of Contents



Recent Accounting Pronouncements
  
 Item 7A.
    
    Quantitative and Qualitative Disclosures About Market Risk.
  
 Item 8.
    
    Financial Statements and Supplementary Data.
  
 Item 9.
    
    Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure.
  
 Item 9A.
    
    Controls and Procedures.
 Disclosure Controls and Procedures
   -61-




---



##### Table of Contents



Changes in Internal Control over Financial Reporting
  Managements Report on Internal Control over Financial Reporting
 Internal Control  Integrated Framework Internal Control  Integrated Framework
  
 Item 9B.
    
    Other Information.
   -62-




---



##### Table of Contents



PART III
  
 Item 10.
    
    Directors, Executive Officers and Corporate Governance.
 Code of Ethics
   
 Item 11.
    
    Executive Compensation.
  
 Item 12.
    
    Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters.
  
 Item 13.
    
    Certain Relationships and Related Transactions, and Director Independence.
  
 Item 14.
    
    Principal Accounting Fees and Services.
  
 PART IV
 
 Item 15.
    
    Exhibits, Financial Statement Schedules.
 (a)
    
    Documents Filed. The following documents are filed as part of this report:
 (1)
    
    Financial Statements. The following report of J.H. Cohn LLP and
financial statements:
 
    
    Report of J.H. Cohn LLP, Independent Registered Public Accounting Firm
 
    
    Consolidated Balance Sheets as of December 31, 2010 and 2009
 
    
    Consolidated Statements of Operations for the years ended December 31, 2010
and 2009 and from inception through December 31, 2010
  -63-




---



##### Table of Contents




    
    Consolidated Statements of Stockholders Equity (Deficit) and Comprehensive
Loss from inception through December 31, 2010
 
    
    Consolidated Statements of Cash Flows for the years ended December 31, 2010
and 2009 and from inception through December 31, 2010
 
    
    Notes to Consolidated Financial Statements
 (2)
    
    Financial Statement Schedules. See subsection (c) below.
 (3)
    
    Exhibits. See subsection (b) below.
 (b)
    
    Exhibits.
 Exhibit
    
    Description2.1
    (1)
    
    Agreement and Plan of Merger, dated April 7, 2006, among the registrant, Speed
Acquisition, Inc., SD Pharmaceuticals, Inc. and certain individuals named
therein (including exhibits thereto)3.1
    (2)
    
    Amended and Restated Certificate of Incorporation of the registrant3.2
    (3)
    
    Certificate of Amendment to the Amended and Restated Certificate of
Incorporation of the registrant dated October 5, 20093.3
    (4)
    
    Certificate of Amendment to the Amended and Restated Certificate of
Incorporation of the registrant, dated April 23, 20103.4
    (5)
    
    Certificate of Designation of Preferences, Rights and Limitations of 0% Series A
Convertible Preferred Stock3.5
    (6)
    
    Certificate of Designation of Preferences, Rights and Limitations of 5% Series B
Convertible Preferred Stock3.6
    (7)
    
    Certificate of Designation of Preferences, Rights and Limitations of 5% Series C
Convertible Preferred Stock3.7
    (8)
    
    Certificate of Designation of Preferences, Rights and Limitations of 4.25660%
Series D Convertible Preferred Stock3.8
    (9)
    
    Certificate of Designation of Preferences, Rights and Limitations of
3.73344597664961% Series E Convertible Preferred Stock3.9
    (10)
    
    Certificate of Designation of Preferences, Rights and Limitations of
2.19446320054018% Series F Convertible Preferred Stock3.10
    (11)
    
    Amended and Restated Bylaws of the registrant (formerly known as Biokeys
Pharmaceuticals, Inc.)10.1
    (12)
    
    Securities Purchase Agreement, dated July 21, 2005, among the registrant and the
Purchasers (as defined therein)10.2
    (12)
    
    Rights Agreement, dated July 27, 2005, among the registrant, the Icahn
Purchasers and Viking (each as defined therein)10.3
    (13)
    
    First Amendment to Rights Agreement, dated September 22, 2006, among the
registrant and the Icahn Purchasers (as defined therein)10.4
    (14)
    
    Second Amendment to Rights Agreement, dated February 25, 2008, among the
registrant and the Icahn Purchasers (as defined therein)10.5
    (15)
    
    Third Amendment to Rights Agreement, dated August 26, 2009, among the registrant
and Icahn Purchasers (as defined therein)10.6
    (12)
    
    Form of $2.26 Common Stock Warrant issued on July 27, 2005 to Icahn Partners LP,
Icahn Partners Master Fund LP, High River Limited Partnership, Viking Global
Equities LP and VGE III Portfolio Ltd.
  -64-




---



##### Table of Contents



Exhibit
    
    Description10.7
    (12)
    
    Form of $2.26 Common Stock Warrant issued on July 27, 2005 to North Sound Legacy
Institutional Fund LLC and North Sound Legacy International Ltd.10.8
    (5)
    
    Engagement Letter Agreement, dated June 7, 2009, by and between the registrant
and Rodman & Renshaw, LLC10.9
    (5)
    
    Securities Purchase Agreement, date June 8, 2009, governing the issuance and
sale of the registrants 0% Series A Convertible Preferred Stock and 5-year
common stock purchase warrants10.10
    (5)
    
    Form of Common Stock Purchase Warrant issued on June 12, 2009 by the registrant
to the purchasers of the registrants 0% Series A Convertible Preferred Stock
and to Rodman & Renshaw, LLC10.11
    (6)
    
    Engagement Letter Agreement, dated June 26, 2009, by and between the registrant
and Rodman & Renshaw, LLC10.12
    (6)
    
    Securities Purchase Agreement, dated June 29, 2009, governing the issuance and
sale of the registrants 5% Series B Convertible Preferred Stock10.13
    (6)
    
    Form of Common Stock Purchase Warrant issued on July 6, 2009 by the registrant
to Rodman & Renshaw, LLC10.14
    (7)
    
    Engagement Letter Agreement, dated August 4, 2009, by and between the registrant
and Rodman & Renshaw, LLC10.15
    (7)
    
    Securities Purchase Agreement, dated August 5, 2009, governing the issuance and
sale of the registrants 5% Series C Convertible Preferred Stock10.16
    (7)
    
    Form of Common Stock Purchase Warrant issued on August 10, 2009 by the
registrant to Rodman & Renshaw, LLC10.17
    (16)
    
    Engagement Letter Agreement, dated September 24, 2009, by and between the
registrant and Rodman & Renshaw, LLC10.18
    (8)
    
    Engagement Letter Agreement, dated September 29, 2009, by and between the
registrant and Rodman & Renshaw, LLC10.19
    (8)
    
    Form of Securities Purchase Agreement, dated October 6, 2009, governing the
issuance and sale of the registrants 4.25660% Series D Convertible Preferred
Stock and 5-year common stock purchase warrants10.20
    (8)
    
    Form of Common Stock Purchase Warrant issued on October 9, 2009 by the
registrant to the purchasers of the registrants 4.25660% Series D Convertible
Preferred Stock and to Rodman & Renshaw, LLC10.21
    (9)
    
    Engagement Letter Agreement, dated January 3, 2010, by and between the
registrant and Rodman & Renshaw, LLC10.22
    (9)
    
    Securities Purchase Agreement, dated as of January 4, 2010, governing the
issuance and sale of the registrants 3.73344597664961% Series E Convertible
Preferred Stock and 30-month common stock purchase warrants10.23
    (9)
    
    Form of Common Stock Purchase Warrant issued on January 7, 2010 by the
registrant to the purchasers of the registrants 3.73344597664961% Series E
Convertible Preferred Stock and to Rodman & Renshaw, LLC10.24
    (10)
    
    Engagement Letter Agreement, dated April 29, 2010, by and between the registrant
and Rodman & Renshaw, LLC
  -65-




---



##### Table of Contents



Exhibit
    
    Description10.25
    (10)
    
    Form of Securities Purchase Agreement, dated May 2, 2010 governing the issuance
and sale of the registrants 2.19446320054018% Series F Convertible Preferred
Stock and 5-year and 1-year common stock purchase warrants10.26
    (10)
    
    Form of Series A and B Common Stock Purchase Warrants issued on May 6, 2010 by
the registrant to the purchasers of the registrants 2.19446320054018% Series F
Convertible Preferred Stock10.27
    (17)
    
    Engagement Letter Agreement, dated January 5, 2011, by and between the
registrant and Rodman & Renshaw, LLC10.28
    (17)
    
    Form of Securities Purchase Agreement, dated January 6, 2011 governing the
issuance and sale of the registrants common stock and 5-year and 1-year common
stock purchase warrants10.29
    (17)
    
    Form of [Series A/B] Common Stock Purchase Warrant issued on January 11, 2011 by
the registrant to the purchasers of the registrants common stock and to Rodman
& Renshaw, LLC10.30
    #(18)
    
    2005 Equity Incentive Plan10.31
    #(19)
    
    Form of Stock Option Agreement under the 2005 Equity Incentive Plan10.32
    #(20)
    
    Form of Stock Option Agreement under the 2005 Equity Incentive Plan (for
director option grants beginning in 2008)10.33
    #(21)
    
    Form of Stock Option Agreement under the 2005 Equity Incentive Plan (for option
grants to employees approved in March 2008)10.34
    #(2)
    
    Form of Restricted Share Award Agreement under the 2005 Equity Incentive Plan10.35
    #(22)
    
    2008 Omnibus Incentive Plan10.36
    #(23)
    
    Form of Notice of Grant of Restricted Stock Units under the 2008 Omnibus
Incentive Plan (for grants to employees in January 2009)10.37
    #(23)
    
    Form of Restricted Stock Units Agreement under the 2008 Omnibus Incentive Plan10.38
    #(24)
    
    Form of Non-Statutory Stock Option Grant Agreement (for directors) under the
2008 Omnibus Incentive Plan10.39
    #(24)
    
    Form of Non-Statutory/Incentive Stock Option Grant Agreement (for
consultants/employees) under the 2008 Omnibus Incentive Plan10.40
    #(25)
    
    Form of Incentive Stock Option Grant Agreement under the 2008 Omnibus Incentive
Plan (for grant to Brian M. Culley in July 2009)10.41
    #(25)
    
    Form of Incentive Stock Option Grant Agreement under the 2008 Omnibus Incentive
Plan (for grant to Patrick L. Keran in July 2009)10.42
    #(26)
    
    Form of letter, dated January 20, 2010, modifying options granted to Brian M.
Culley and Patrick L. Keran in July 200910.43
    #(26)
    
    Form of Incentive Stock Option Grant Agreement under the 2008 Omnibus Incentive
Plan (for grant to Brian M. Culley in January 2010)10.44
    #(26)
    
    Form of Incentive Stock Option Grant Agreement under the 2008 Omnibus Incentive
Plan (for grant to Patrick L. Keran in January 2010)10.45
    (20)
    
    License Agreement, dated December 10, 2005, among SD Pharmaceuticals, Latitude
Pharmaceuticals and Andrew Chen, including a certain letter, dated November 20,
2007, clarifying the scope of rights thereunder10.46
     (27)
    
    License Agreement, dated March 25, 2009, among the registrant, SD
Pharmaceuticals, Inc. and Shin Poong Pharmaceutical Co., Ltd.10.47
    (28)
    
    Standard Multi-Tenant Office Lease  Gross, dated June 3, 2004, between the
registrant and George V. Casey & Ellen M. Casey, Trustees of the Casey Family
Trust dated June 22, 1998
  -66-




---



##### Table of Contents



Exhibit
    
    Description10.48
    (2)
    
    First Amendment to the Standard Multi-Tenant Office Lease  Gross, dated June
3, 2004 between the registrant and George V. & Ellen M. Casey, Trustees of the
Casey Family Trust dated June 22, 199810.49
    (29)
    
    Second Amendment to Standard Mutli-Tenant Office Lease  Gross, dated July 22,
2009, by and among Westcore Mesa View, LLC, DD Mesa View LLC and the registrant10.50
    (30)
    
    Third Amendment to Standard Multi-Tenant Office Lease  Gross, dated December
10, 2009, by and among Westcore Mesa View, LLC, DD Mesa View, LLC and the
registrant10.51
    (31)
    
    Fourth Amendment to Standard Multi-Tenant Office Lease  Gross, dated February
4, 2010, by and among Westcore Mesa View, LLC, DD Mesa View, LLC and the
registrant10.52
    #(32)
    
    Offer letter, dated November 15, 2004, to Brian M. Culley10.53
    #(23)
    
    Retention and Incentive Agreement, dated January 28, 2009 between the registrant
and Brian M. Culley10.54
    #(27)
    
    Retention and Incentive Agreement, dated January 28, 2009, between the
registrant and Patrick L. Keran10.55
    #(31)
    
    Consulting Agreement, effective as of July 15, 2009, and Amendment to Consulting
Agreement, effective as of December 31, 2009, between the registrant and Michele
L. Yelmene10.56
    #(25)
    
    2009 Mid-Year Incentive Plan for Brian M. Culley and Patrick L. Keran10.57
    #(25)
    
    Retention and Severance Plan (as of July 21, 2009) for Brian M. Culley and
Patrick L. Keran10.58
    #(26)
    
    2010 Incentive Plan for Brian M. Culley and Patrick L. Keran10.59
    #(31)
    
    Consulting Agreement, effective as of November 23, 2009, between the registrant
and Eric K. Rowinsky10.60
    #(33)
    
    Director Compensation Policy, adopted June 21, 200610.61
    #(31)
    
    Director Compensation Policy, adopted January 25, 201010.62
    (34)
    
    Form of Director and Officer Indemnification Agreement21.1
    
    
    List of Subsidiaries23.1
    
    
    Consent of J.H. Cohn LLP, Independent Registered Public Accounting Firm31.1
    
    
    Certification of principal executive officer pursuant to Rule 13a-14(a)/15d-14(a)31.2
    
    
    Certification of principal financial officer pursuant to Rule 13a-14(a)/15d-14(a)32.1
    ±
    
    Certification of principal executive officer and principal financial officer
pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
 
 
    
    Indicates that confidential treatment has been requested or granted to
certain portions, which portions have been omitted and filed
separately with the SEC#
    
    Indicates management contract or compensatory plan±
    
    These certifications are being furnished solely to accompany this
report pursuant to 18 U.S.C. 1350, and are not being filed for
purposes of Section 18 of the Securities Exchange Act of 1934 and are
not to be incorporated by reference into any filing of the registrant,
whether made before or after the date hereof, regardless of any
general incorporation by reference language in such filing.(1)
    
    Filed with the registrants Amendment No. 1 to Current Report on Form 8-K/A on May 1, 2006
(SEC file number 001-32157-06796248)  -67-




---



##### Table of Contents



(2)
    
    Filed with the registrants Annual Report on Form 10-K on March 16, 2006 (SEC file number
001-32157-06693266)(3)
    
    Filed with the registrants Current Report on Form 8-K on October 13, 2009 (SEC file number
001-32157-091115090)(4)
    
    Filed with the registrants Current Report on Form 8-K on April 26, 2010 (SEC file number
001-32157-10769058)(5)
    
    Filed with the registrants Current Report on Form 8-K on June 8, 2009 (SEC file number
001-32157-09878961)(6)
    
    Filed with the registrants Current Report on Form 8-K on June 30, 2009 (SEC file number
001-32157-09917820)(7)
    
    Filed with the registrants Current Report on Form 8-K on August 5, 2009 (SEC file number
001-32157-09989205)(8)
    
    Filed with the registrants Amendment No. 3 to the Registration Statement on Form S-1 on
October 5, 2009 (SEC file number 333-160778-091107945)(9)
    
    Filed with the registrants Current Report on Form 8-K on January 4, 2010 (SEC file number
001-32157- 10500379)(10)
    
    Filed with the registrants Current Report on Form 8-K on May 3, 2010 (SEC file number
001-32157-10790486)(11)
    
    Filed with the registrants Current Report on Form 8-K on December 15, 2008 (SEC file number
001-32157-081249921)(12)
    
    Filed with the registrants Quarterly Report on Form 10-Q on August 12, 2005 (SEC file number
001-32157-051022046)(13)
    
    Filed with the registrants Current Report on Form 8-K on September 22, 2006 (SEC file number
001-32157-061103268)(14)
    
    Filed with the registrants Current Report on Form 8-K on February 25, 2008 (SEC file number
001-32157 08638638)(15)
    
    Filed with the registrants Current Report on Form 8-K on September 1, 2009 (SEC file number
001-32157-091049161)(16)
    
    Filed with the registrants Amendment No. 2 to the Registration Statement on Form S-1 on
September 25, 2009 (SEC file number 333-160778-091087750)(17)
    
    Filed with the registrants Current Report on Form 8-K on January 7, 2011 (SEC file number
001-32157-11515655)(18)
    
    Filed with the registrants Annual Report on Form 10-K on March 15, 2007 (SEC file number
001-32157-07697283)(19)
    
    Filed with the registrants Registration Statement on Form S-8 on July 13, 2005 (SEC file
number 333-126551-05951362)(20)
    
    Filed with registrants Annual Report on Form 10-K on March 17, 2008 (SEC file number
001-32157-08690952)(21)
    
    Filed with the registrants Quarterly Report on Form 10-Q on May 12, 2008 (SEC file number
001-32157-08820541)(22)
    
    Filed with the registrants Current Report on Form 8-K on June 2, 2008 (SEC file number
001-32157-08874724)(23)
    
    Filed with the registrants Current Report on Form 8-K on February 2, 2009 (SEC file number
001-32157- 09561715)(24)
    
    Filed with the registrants Quarterly Report on Form 10-Q on August 11, 2008 (SEC file number
001-32157-081005744)  -68-




---



##### Table of Contents



(25)
    
    Filed with the registrants Current Report on Form 8-K on July 22, 2009 (SEC file number
001-32157-09957353)(26)
    
    Filed with the registrants Current Report on Form 8-K on January 26, 2010 (SEC file number
001-32157- 10547818)(27)
    
    Filed with the registrants Quarterly Report on Form 10-Q on May 15, 2009 (SEC file number
001-32157-09878961)(28)
    
    Filed with the registrants Quarterly Report on Form 10-QSB on August 10, 2004 (SEC file
number 001-32157-04963741)(29)
    
    Filed with the registrants Current Report on Form 8-K on August 20, 2009 (SEC file number
001-32157-091025631)(30)
    
    Filed with the registrants Current Report on Form 8-K on December 24, 2009 (SEC file number
001-32157-091260100)(31)
    
    Filed with the registrants Annual Report on Form 10-K on March 18, 2010 (SEC file number
001-32157-10692317)(32)
    
    Filed with the registrants Annual Report on Form 10-KSB on March 31, 2005 (SEC file number
001-32157-05719975)(33)
    
    Filed with the registrants Current Report on Form 8-K on June 23, 2006 (SEC file number
001-32157-06922676)(34)
    
    Filed with the registrants Current Report on Form 8-K on October 23, 2006 (SEC file number
001-32157-061156993)(c)
    
    Financial Statement Schedules. All schedules are omitted because they are not
applicable, the amounts involved are not significant or the required information is shown in
the financial statements or notes thereto.  -69-




---



##### Table of Contents



SIGNATURES
  Date: March 10, 2011
    ADVENTRX Pharmaceuticals, Inc.By:
    /s/ Brian M. CulleyBrian M. CulleyChief Executive Officer   Signature
    
    Title
    
    Date/s/ Brian M. Culley

Brian M. Culley
    
    Chief Executive Officer
(Principal Executive Officer)
    
    March 10, 2011/s/ Patrick L. Keran

Patrick L. Keran
    
    President and Chief Operating Officer
(Principal Financial and Accounting Officer)
    
    March 10, 2011/s/ Jack Lief

Jack Lief
    
    Chair of the Board
    
    March 10, 2011/s/ Michael M. Goldberg

Michael M. Goldberg
    
    Director
    
    March 10, 2011/s/ Odysseas D. Kostas

Odysseas D. Kostas
    
    Director
    
    March 10, 2011/s/ Mark J. Pykett

Mark J. Pykett
    
    Director
    
    March 10, 2011/s/ Eric K. Rowinsky

Eric K. Rowinsky
    
    Director
    
    March 10, 2011
  -70-




---



##### Table of Contents



Index to Consolidated Financial Statements
 PageReport of Independent Registered Public Accounting Firm
    
    
    F-2Financial Statements:Consolidated Balance Sheets
    
    
    F-3Consolidated Statements of Operations
    
    
    F-4Consolidated Statements of Stockholders Equity (Deficit) and Comprehensive Loss
    
    
    F-5 - F-8Consolidated Statements of Cash Flows
    
    
    F-9 - F-10Notes to Consolidated Financial Statements
    
    
    F-11 - F-31Financial Statement Schedules:Financial statement schedules have been omitted for the reason that the
required information is presented in financial statements or notes thereto, the
amounts involved are not significant or the schedules are not applicable.
  F-1




---



##### Table of Contents



Report of Independent Registered Public Accounting Firm
 
     
  F-2




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries
 
 Consolidated Balance Sheets
 December 31,2010
    
    
    2009AssetsCurrent assets:Cash
    
    $
    27,978,823
    
    
    $
    8,667,404Interest and other receivables
    
    
    1,980
    
    
    
    14,841Prepaid expenses
    
    
    428,276
    
    
    
    290,249Total current assets
    
    
    28,409,079
    
    
    
    8,972,494Property and equipment, net
    
    
    44,254
    
    
    
    44,210Other assets
    
    
    33,484
    
    
    
    10,513Total assets
    
    $
    28,486,817
    
    
    $
    9,027,217Liabilities and Stockholders EquityCurrent liabilities:Accounts payable
    
    $
    479,780
    
    
    $
    385,358Accrued liabilities
    
    
    864,857
    
    
    
    1,379,010Accrued compensation and payroll taxes
    
    
    456,839
    
    
    
    589,319Total current liabilities
    
    
    1,801,476
    
    
    
    2,353,687Commitments and contingenciesStockholders equity:Convertible Preferred Stock, Series A through F, $0.001 par
value; 53,776.13 and 15,559 shares authorized as of December 31,
2010 and 2009, respectively; 0 shares issued and outstanding at
December 31, 2010 and 2009
    
    
    
    
    
    
    Common stock, $0.001 par value; 500,000,000
shares authorized; 15,480,302 and 8,211,410
shares issued and outstanding at December 31,
2010 and 2009, respectively
    
    
    15,480
    
    
    
    8,211Additional paid-in capital
    
    
    182,798,982
    
    
    
    148,703,722Deficit accumulated during the development stage
    
    
    (156,129,121
    )
    
    
    (142,038,403
    )Total stockholders equity
    
    
    26,685,341
    
    
    
    6,673,530Total liabilities and stockholders equity
    
    $
    28,486,817
    
    
    $
    9,027,217
   F-3




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries
 
 Consolidated Statements of Operations
 Inception(June 12, 1996)ThroughYears Ended December 31,
    
    
    December 31,2010
    
    
    2009
    
    
    2010Licensing revenue
    
    $
    
    
    
    $
    300,000
    
    
    $
    1,300,000Net sales
    
    
    
    
    
    
    
    
    
    
    174,830Grant revenue
    
    
    488,959
    
    
    
    
    
    
    
    618,692Total net revenue
    
    
    488,959
    
    
    
    300,000
    
    
    
    2,093,522Cost of sales
    
    
    
    
    
    
    
    
    
    
    51,094Gross margin
    
    
    488,959
    
    
    
    300,000
    
    
    
    2,042,428Operating expenses:Research and development
    
    
    3,688,762
    
    
    
    6,507,650
    
    
    
    72,210,967Selling, general and administrative
    
    
    5,320,073
    
    
    
    4,998,307
    
    
    
    53,287,583Depreciation and amortization
    
    
    19,821
    
    
    
    79,728
    
    
    
    10,897,618In-process research and development
    
    
    
    
    
    
    
    
    
    
    10,422,130Impairment loss  write-off of goodwill
    
    
    
    
    
    
    
    
    
    
    5,702,130Equity in loss of investee
    
    
    
    
    
    
    
    
    
    
    178,936Total operating expenses
    
    
    9,028,656
    
    
    
    11,585,685
    
    
    
    152,699,364Loss from operations
    
    
    (8,539,697
    )
    
    
    (11,285,685
    )
    
    
    (150,656,936
    )Loss on fair value of warrants
    
    
    
    
    
    
    
    
    
    
    (12,239,688
    )Interest income
    
    
    92,873
    
    
    
    7,162
    
    
    
    4,682,061Interest expense
    
    
    (1,629
    )
    
    
    
    
    
    
    (180,719
    )Other income (expense)
    
    
    (2,469
    )
    
    
    (46,535
    )
    
    
    63,375Loss before income taxes
    
    
    (8,450,922
    )
    
    
    (11,325,058
    )
    
    
    (158,331,907
    )Provision for income taxes
    
    
    
    
    
    
    
    
    
    
    Loss before cumulative effect of change in
accounting principle
    
    
    (8,450,922
    )
    
    
    (11,325,058
    )
    
    
    (158,331,907
    )Cumulative effect of change in accounting
principle
    
    
    
    
    
    
    
    
    
    
    (25,821
    )Net loss
    
    
    (8,450,922
    )
    
    
    (11,325,058
    )
    
    
    (158,357,728
    )Preferred stock dividends
    
    
    
    
    
    
    
    
    
    
    (621,240
    )Deemed dividends on preferred stock
    
    
    (5,639,796
    )
    
    
    (4,866,887
    )
    
    
    (10,506,683
    )Net loss applicable to common stock
    
    $
    (14,090,718
    )
    
    $
    (16,191,945
    )
    
    $
    (169,485,651
    )Loss per common share  basic and diluted
    
    $
    (1.07
    )
    
    $
    (3.47
    )Weighted average shares outstanding 
basic and diluted
    
    
    13,180,583
    
    
    
    4,667,160
   F-4




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries
 
 Consolidated Statements of Stockholders Equity (Deficit) and Comprehensive Loss
  DeficitCumulative convertible
    
    
    Convertible
    
    
    Cumulative convertible
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Accumulated
    
    
    accumulated
    
    
    
    
    
    
    Totalpreferred stock,
    
    
    preferred stock,
    
    
    preferred stock,
    
    
    
    
    
    
    
    
    
    
    Additional
    
    
    other
    
    
    during the
    
    
    Treasury
    
    
    stockholdersseries A through C
    
    
    series A (2009)
    
    
    series B through F (2009 - 2010)
    
    
    Common stock
    
    
    paid-in
    
    
    comprehensive
    
    
    development
    
    
    stock,
    
    
    equity
    
    
    ComprehensiveShares
    
    
    Amount
    
    
    Shares
    
    
    Amount
    
    
    Shares
    
    
    Amount
    
    
    Shares
    
    
    Amount
    
    
    capital
    
    
    income (loss)
    
    
    stage
    
    
    at cost
    
    
    (deficit)
    
    
    lossBalances at June 12, 1996 (date of incorporation)
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    Sale of common stock without par value
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    20
    
    
    
    
    
    
    
    10
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    10Issuance of common stock and net liabilities assumed in acquisition
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    68,645
    
    
    
    69
    
    
    
    4,871
    
    
    
    
    
    
    
    (18,094
    )
    
    
    
    
    
    
    (13,154
    )Issuance of common stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    80,405
    
    
    
    80
    
    
    
    2,386
    
    
    
    
    
    
    
    (2,466
    )
    
    
    
    
    
    
    Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (259,476
    )
    
    
    
    
    
    
    (259,476
    )
    
    $
    (259,476
    )Balances at December 31, 1996
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    149,070
    
    
    
    149
    
    
    
    7,267
    
    
    
    
    
    
    
    (280,036
    )
    
    
    
    
    
    
    (272,620
    )
    
    $
    (259,476
    )Sale of common stock, net of offering costs of $9,976
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    40,182
    
    
    
    40
    
    
    
    1,790,939
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,790,979Issuance of common stock in acquisition
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    15,036
    
    
    
    15
    
    
    
    888,235
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    888,250Minority interest deficiency at acquisition charged to the Company
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (45,003
    )
    
    
    
    
    
    
    (45,003
    )Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,979,400
    )
    
    
    
    
    
    
    (1,979,400
    )
    
    $
    (1,979,400
    )Balances at December 31, 1997
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    204,288
    
    
    
    204
    
    
    
    2,686,441
    
    
    
    
    
    
    
    (2,304,439
    )
    
    
    
    
    
    
    382,206
    
    
    $
    (1,979,400
    )Rescission of acquisition
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (15,036
    )
    
    
    (15
    )
    
    
    (888,235
    )
    
    
    
    
    
    
    561,166
    
    
    
    
    
    
    
    (327,084
    )Issuance of common stock at conversion of notes payable
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    18,011
    
    
    
    18
    
    
    
    363,982
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    364,000Expense related to stock warrants issued
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    260,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    260,000Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,204,380
    )
    
    
    
    
    
    
    (1,204,380
    )
    
    $
    (1,204,380
    )Balances at December 31, 1998
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    207,263
    
    
    
    207
    
    
    
    2,422,188
    
    
    
    
    
    
    
    (2,947,653
    )
    
    
    
    
    
    
    (525,258
    )
    
    $
    (1,204,380
    )Sale of common stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    27,136
    
    
    
    27
    
    
    
    134,973
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    135,000Expense related to stock warrants issued
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    212,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    212,000Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,055,485
    )
    
    
    
    
    
    
    (1,055,485
    )
    
    $
    (1,055,485
    )Balances at December 31, 1999
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    234,399
    
    
    
    234
    
    
    
    2,769,161
    
    
    
    
    
    
    
    (4,003,138
    )
    
    
    
    
    
    
    (1,233,743
    )
    
    $
    (1,055,485
    )Sale of preferred stock, net of offering costs of $76,500
    
    
    3,200
    
    
    
    32
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,123,468
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,123,500Issuance of common stock at conversion of notes and interest payable
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    16,499
    
    
    
    16
    
    
    
    492,481
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    492,497Issuance of common stock at conversion of notes payable
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,814
    
    
    
    3
    
    
    
    83,997
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    84,000Issuance of common stock to settle obligations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    19,804
    
    
    
    20
    
    
    
    1,202,140
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,202,160Issuance of common stock for
acquisition
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    280,000
    
    
    
    280
    
    
    
    9,332,489
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,332,769Issuance of warrants for acquisition
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,767,664
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,767,664Stock issued for acquisition costs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6,000
    
    
    
    6
    
    
    
    487,494
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    487,500Expense related to stock warrants
issued
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    140,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    140,000Dividends payable on preferred stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (85,000
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (85,000
    )Cashless exercise of warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    23,963
    
    
    
    24
    
    
    
    (24
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,701,084
    )
    
    
    
    
    
    
    (3,701,084
    )
    
    $
    (3,701,084
    )Balances at December 31, 2000
    
    
    3,200
    
    
    
    32
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    583,479
    
    
    
    583
    
    
    
    22,313,870
    
    
    
    
    
    
    
    (7,704,222
    )
    
    
    
    
    
    
    14,610,263
    
    
    $
    (3,701,084
    )
   F-5




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries
 Consolidated Statements of Stockholders Equity (Deficit) and Comprehensive Loss
  DeficitCumulative convertible
    
    
    Convertible
    
    
    Cumulative convertible
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Accumulated
    
    
    accumulated
    
    
    
    
    
    
    Totalpreferred stock,
    
    
    preferred stock,
    
    
    preferred stock,
    
    
    
    
    
    
    
    
    
    
    Additional
    
    
    other
    
    
    during the
    
    
    Treasury
    
    
    stockholdersseries A through C
    
    
    series A (2009)
    
    
    series B through F (2009 - 2010)
    
    
    Common stock
    
    
    paid-in
    
    
    comprehensive
    
    
    development
    
    
    stock,
    
    
    equity
    
    
    ComprehensiveShares
    
    
    Amount
    
    
    Shares
    
    
    Amount
    
    
    Shares
    
    
    Amount
    
    
    Shares
    
    
    Amount
    
    
    capital
    
    
    income (loss)
    
    
    stage
    
    
    at cost
    
    
    (deficit)
    
    
    lossDividends payable on preferred stock
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    (256,000
    )
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    (256,000
    )Repurchase of warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (55,279
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (55,279
    )Sale of warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    47,741
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    47,741Cashless exercise of warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,740
    
    
    
    9
    
    
    
    (9
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Issuance of common stock to pay preferred
dividends
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,737
    
    
    
    4
    
    
    
    212,996
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    213,000Detachable warrants issued with notes payable
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    450,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    450,000Issuance of warrants to pay operating expenses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    167,138
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    167,138Issuance of common stock to pay operating
expenses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,252
    
    
    
    4
    
    
    
    387,267
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    387,271Issuance of preferred stock to pay operating
expenses
    
    
    137
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    136,499
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    136,500Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (16,339,120
    )
    
    
    
    
    
    
    (16,339,120
    )
    
    $
    (16,339,120
    )Balances at December 31, 2001
    
    
    3,337
    
    
    
    33
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    600,208
    
    
    
    600
    
    
    
    23,404,223
    
    
    
    
    
    
    
    (24,043,342
    )
    
    
    
    
    
    
    (638,486
    )
    
    $
    (16,339,120
    )Dividends payable on preferred stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (242,400
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (242,400
    )Repurchase of warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Sale of warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,600
    
    
    
    10
    
    
    
    117,843
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    117,853Cashless exercise of warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,008
    
    
    
    4
    
    
    
    (4
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Exercise of warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    13,783
    
    
    
    14
    
    
    
    168,808
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    168,822Sale of preferred stock at $1.50 per share
    
    
    200,000
    
    
    
    2,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    298,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    300,000Sale of preferred stock at $10.00 per share
    
    
    70,109
    
    
    
    701
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    700,392
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    701,093Conversion of preferred stock into common stock
    
    
    (3,000
    )
    
    
    (30
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    72,000
    
    
    
    72
    
    
    
    (42
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Preferred stock dividends forgiven
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    335,440
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    335,440Issuance of warrants to pay operating expenses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    163,109
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    163,109Issuance of common stock to pay operating
expenses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    251
    
    
    
    
    
    
    
    12,269
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    12,269Issuance of preferred stock to pay operating
expenses
    
    
    136
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6,001Issuance of stock options to employees
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    329,296
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    329,296Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,105,727
    )
    
    
    
    
    
    
    (2,105,727
    )
    
    $
    (2,105,727
    )Balances at December 31, 2002
    
    
    270,582
    
    
    
    2,705
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    699,850
    
    
    
    700
    
    
    
    25,292,934
    
    
    
    
    
    
    
    (26,149,069
    )
    
    
    
    
    
    
    (852,730
    )
    
    $
    (2,105,727
    )Dividends payable on preferred stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (37,840
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (37,840
    )Conversion of Series C preferred stock into common stock
    
    
    (70,109
    )
    
    
    (701
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    560,874
    
    
    
    561
    
    
    
    140
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Issuance of common stock to pay interest on Bridge Notes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6,633
    
    
    
    7
    
    
    
    53,484
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    53,491Sale of common stock at $0.40 per share, net of issuance costs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    265,630
    
    
    
    266
    
    
    
    2,597,066
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,597,332Sale of common stock at $1.00 per share, net of issuance costs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    148,069
    
    
    
    148
    
    
    
    3,992,701
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,992,849Exchange of warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,412
    
    
    
    9
    
    
    
    49,712
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    49,721Issuance of common stock to pay operating
expenses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,200
    
    
    
    9
    
    
    
    206,790
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    206,799Issuance of warrants to pay operating expenses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    156,735
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    156,735Issuance of stock options to employees
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    286,033
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    286,033Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,332,077
    )
    
    
    
    
    
    
    (2,332,077
    )
    
    $
    (2,332,077
    )Balances at December 31, 2003
    
    
    200,473
    
    
    
    2,004
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,699,668
    
    
    
    1,700
    
    
    
    32,597,755
    
    
    
    
    
    
    
    (28,481,146
    )
    
    
    
    
    
    
    4,120,313
    
    
    $
    (2,332,077
    )
   F-6




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries
 Consolidated Statements of Stockholders Equity (Deficit) and Comprehensive Loss
  DeficitCumulative convertible
    
    
    Convertible
    
    
    Cumulative convertible
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Accumulated
    
    
    accumulated
    
    
    
    
    
    
    Totalpreferred stock,
    
    
    preferred stock,
    
    
    preferred stock,
    
    
    
    
    
    
    
    
    
    
    Additional
    
    
    other
    
    
    during the
    
    
    Treasury
    
    
    stockholdersseries A through C
    
    
    series A (2009)
    
    
    series B through F (2009 - 2010)
    
    
    Common stock
    
    
    paid-in
    
    
    comprehensive
    
    
    development
    
    
    stock,
    
    
    equity
    
    
    ComprehensiveShares
    
    
    Amount
    
    
    Shares
    
    
    Amount
    
    
    Shares
    
    
    Amount
    
    
    Shares
    
    
    Amount
    
    
    capital
    
    
    income (loss)
    
    
    stage
    
    
    at cost
    
    
    (deficit)
    
    
    lossExtinguishment of dividends payable on preferred stock
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    72,800
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    72,800Conversion of Series A cumulative preferred
stock
    
    
    (473
    )
    
    
    (4
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,460
    
    
    
    9
    
    
    
    (5
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Conversion of Series B preferred stock
    
    
    (200,000
    )
    
    
    (2,000
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,000
    
    
    
    8
    
    
    
    1,992
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Cashless exercise of warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    18,583
    
    
    
    18
    
    
    
    (18
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Exercise of warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    953
    
    
    
    1
    
    
    
    27,352
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    27,353Issuance of warrants in settlement of a claim
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    86,375
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    86,375Sale of common stock at $1.50 per share
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    416,705
    
    
    
    417
    
    
    
    15,626,033
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    15,626,450Payment of financing and offering costs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,366,774
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,366,774
    )Issuance of stock options to employees
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    524,922
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    524,922Acquisition of treasury stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    34,747
    
    
    
    
    
    
    
    
    
    
    
    (34,747
    )
    
    
    Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (6,701,048
    )
    
    
    
    
    
    
    (6,701,048
    )
    
    $
    (6,701,048
    )Balances at December 31, 2004
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,153,369
    
    
    
    2,153
    
    
    
    47,605,179
    
    
    
    
    
    
    
    (35,182,194
    )
    
    
    (34,747
    )
    
    
    12,390,391
    
    
    $
    (6,701,048
    )Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (24,782,646
    )
    
    
    
    
    
    
    (24,782,646
    )
    
    $
    (24,782,646
    )Effect of change in fair value of available-for-sale securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,722
    )
    
    
    
    
    
    
    
    
    
    
    (1,722
    )
    
    
    (1,722
    )Par value of shares issued in conjunction with mezzanine financing
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    432,432
    
    
    
    433
    
    
    
    (433
    )
    
    
    
    
    
    
    
    
    
    
    Cashless exercise of warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,985
    
    
    
    6
    
    
    
    (6
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Exercise of warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    90,348
    
    
    
    90
    
    
    
    3,073,348
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,073,438Exercise of stock options
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,400
    
    
    
    7
    
    
    
    144,993
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    145,000Issuance of stock options to employees
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    994,874
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    994,874Issuance of stock options to non-employee
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    93,549
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    93,549Issuance of common stock to vendor
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,000
    
    
    
    5
    
    
    
    258,495
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    258,500Balances at December 31, 2005, as restated
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,694,534
    
    
    
    2,694
    
    
    
    52,169,999
    
    
    
    (1,722
    )
    
    
    (59,964,840
    )
    
    
    (34,747
    )
    
    
    (7,828,616
    )
    
    $
    (24,784,368
    )Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (29,331,773
    )
    
    
    
    
    
    
    (29,331,773
    )
    
    $
    (29,331,773
    )Effect of change in fair value of available-for-sale securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (368
    )
    
    
    
    
    
    
    
    
    
    
    (368
    )
    
    
    (368
    )Cashless exercise of warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    16,807
    
    
    
    17
    
    
    
    (17
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Exercise of warrants, net of financing costs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    204,150
    
    
    
    204
    
    
    
    7,691,386
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,691,590Acquisition of SD Pharmaceuticals. Inc.
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    84,000
    
    
    
    84
    
    
    
    10,163,868
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    10,163,952Sale of common stock at $2.75 per share, net of offering costs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    581,800
    
    
    
    582
    
    
    
    37,069,629
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    37,070,211Issuance of stock for severance agreement
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,406
    
    
    
    2
    
    
    
    196,672
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    196,674Exercise of stock options
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,700
    
    
    
    4
    
    
    
    125,747
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    125,751Issuance of restricted stock to non-employees
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    600
    
    
    
    1
    
    
    
    68,649
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    68,650Issuance of stock options to employees
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,697,452
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,697,452Issuance of stock options to non-employee
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    104,225
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    104,225Cancellation of treasury stock shares
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (927
    )
    
    
    (1
    )
    
    
    (34,746
    )
    
    
    
    
    
    
    
    
    
    
    34,747
    
    
    
    Balances at December 31, 2006, as restated
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,587,070
    
    
    
    3,587
    
    
    
    109,252,864
    
    
    
    (2,090
    )
    
    
    (89,296,613
    )
    
    
    
    
    
    
    19,957,748
    
    
    $
    (29,332,141
    )Cumulative effect of change in accounting
principle
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    18,116,751
    
    
    
    
    
    
    
    12,239,688
    
    
    
    
    
    
    
    30,356,439Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (22,142,040
    )
    
    
    
    
    
    
    (22,142,040
    )
    
    $
    (22,142,040
    )Effect of change in fair value of available-for-sale securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,792
    
    
    
    
    
    
    
    
    
    
    
    4,792
    
    
    
    4,792Exercise of stock options
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    23,033
    
    
    
    23
    
    
    
    441,593
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    441,616Issuance of stock options to employees
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,414,077
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,414,077Issuance of stock options to non-employee
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,908
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,908Balances at December 31, 2007
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,610,103
    
    
    
    3,610
    
    
    
    130,227,193
    
    
    
    2,702
    
    
    
    (99,198,965
    )
    
    
    
    
    
    
    31,034,540
    
    
    $
    (22,137,248
    )
   F-7




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries
 Consolidated Statements of Stockholders Equity (Deficit) and Comprehensive Loss
  DeficitCumulative convertible
    
    
    Convertible
    
    
    Cumulative convertible
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Accumulated
    
    
    accumulated
    
    
    
    
    
    
    Totalpreferred stock,
    
    
    preferred stock,
    
    
    preferred stock,
    
    
    
    
    
    
    
    
    
    
    Additional
    
    
    other
    
    
    during the
    
    
    Treasury
    
    
    stockholdersseries A through C
    
    
    series A (2009)
    
    
    series B through F (2009 - 2010)
    
    
    Common stock
    
    
    paid-in
    
    
    comprehensive
    
    
    development
    
    
    stock,
    
    
    equity
    
    
    ComprehensiveShares
    
    
    Amount
    
    
    Shares
    
    
    Amount
    
    
    Shares
    
    
    Amount
    
    
    Shares
    
    
    Amount
    
    
    capital
    
    
    income (loss)
    
    
    stage
    
    
    at cost
    
    
    (deficit)
    
    
    lossNet loss
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    (26,647,493
    )
    
    $
    
    
    
    $
    (26,647,493
    )
    
    $
    (26,647,493
    )Effect of change in fair value of available-for-sale securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,702
    )
    
    
    
    
    
    
    
    
    
    
    (2,702
    )
    
    
    (2,702
    )Exercise of stock options
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Issuance of stock options to employees
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,605,908
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,605,908Issuance of stock options to non-employee
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,982
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,982Balances at December 31, 2008
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,610,103
    
    
    
    3,610
    
    
    
    131,838,083
    
    
    
    
    
    
    
    (125,846,458
    )
    
    
    
    
    
    
    5,995,235
    
    
    $
    (26,650,195
    )Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (11,325,058
    )
    
    
    
    
    
    
    (11,325,058
    )
    
    $
    (11,325,058
    )Sale of series A preferred stock, net of offering costs of $389,125
    
    
    
    
    
    
    
    
    
    
    1,993
    
    
    
    2
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,735,627
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,735,629Conversion of series A preferred stock into common stock
    
    
    
    
    
    
    
    
    
    
    (1,993
    )
    
    
    (2
    )
    
    
    
    
    
    
    
    
    
    
    721,448
    
    
    
    721
    
    
    
    (719
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Sale of series B preferred stock, net of offering costs of $247,643
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,361
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    833,030
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    833,031Conversion of series B preferred stock into common stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,361
    )
    
    
    (1
    )
    
    
    380,168
    
    
    
    380
    
    
    
    (379
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Sale of series C preferred stock, net of offering costs of $143,885
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    922
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    711,198
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    711,199Conversion of series C preferred stock into common stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (922
    )
    
    
    (1
    )
    
    
    283,692
    
    
    
    284
    
    
    
    (283
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Sale of series D preferred stock, net of offering costs of $1,327,664
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11,283
    
    
    
    11
    
    
    
    
    
    
    
    
    
    
    
    5,124,125
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,124,136Conversion of series D preferred stock into common stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (11,283
    )
    
    
    (11
    )
    
    
    2,400,000
    
    
    
    2,400
    
    
    
    (2,389
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Deemed dividend on series A preferred stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,207,536
    
    
    
    
    
    
    
    (1,207,536
    )
    
    
    
    
    
    
    Deemed dividend on series B preferred stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    214,795
    
    
    
    
    
    
    
    (214,795
    )
    
    
    
    
    
    
    Deemed dividend on series C preferred stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    186,173
    
    
    
    
    
    
    
    (186,173
    )
    
    
    
    
    
    
    Deemed dividend on series D preferred stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,258,383
    
    
    
    
    
    
    
    (3,258,383
    )
    
    
    
    
    
    
    Issuance of stock options to employees
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    585,438
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    585,438Series A warrants exercised
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    240,000
    
    
    
    240
    
    
    
    899,760
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    900,000Series D warrants exercised
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    576,000
    
    
    
    576
    
    
    
    2,113,344
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,113,920Balances at December 31, 2009
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,211,411
    
    
    
    8,211
    
    
    
    148,703,722
    
    
    
    
    
    
    
    (142,038,403
    )
    
    
    
    
    
    
    6,673,530
    
    
    $
    (11,325,058
    )Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (8,450,922
    )
    
    
    
    
    
    
    (8,450,922
    )
    
    $
    (8,450,922
    )Reduction of shares and cash paid in lieu for fractional shares
following the reverse split
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (31
    )
    
    
    
    
    
    
    (146
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (146
    )Sale of series E preferred stock, net of offering costs of $2,162,787
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    19,000
    
    
    
    19
    
    
    
    
    
    
    
    
    
    
    
    14,014,705
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,014,724Conversion of series E preferred stock into common stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (19,000
    )
    
    
    (19
    )
    
    
    1,993,965
    
    
    
    1,994
    
    
    
    (1,975
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Sale of series F preferred stock, net of offering costs of $1,655,234
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    19,217
    
    
    
    19
    
    
    
    
    
    
    
    
    
    
    
    13,344,749
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    13,344,768Conversion of series F preferred stock into common stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (19,217
    )
    
    
    (19
    )
    
    
    5,190,306
    
    
    
    5,190
    
    
    
    (5,171
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Deemed dividend on series E preferred stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,514,920
    
    
    
    
    
    
    
    (2,514,920
    )
    
    
    
    
    
    
    Deemed dividend on series F preferred stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,124,876
    
    
    
    
    
    
    
    (3,124,876
    )
    
    
    
    
    
    
    Issuance of stock options to employees
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    785,943
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    785,943Series A warrants exercised
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    84,651
    
    
    
    85
    
    
    
    317,359
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    317,444Balances at December 31, 2010
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    
    15,480,302
    
    
    $
    15,480
    
    
    $
    182,798,982
    
    
    $
    
    
    
    $
    (156,129,121
    )
    
    $
    
    
    
    $
    26,685,341
    
    
    $
    (8,450,922
    )
   F-8




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries
 
 Consolidated Statements of Cash Flows
 Inception(June 12, 1996)ThroughYears Ended December 31,
    
    
    December 31,2010
    
    
    2009
    
    
    2010Cash flows from operating activities:Net loss
    
    $
    (8,450,922
    )
    
    $
    (11,325,058
    )
    
    $
    (158,357,728
    )Adjustments to reconcile net loss to net cash used in
operating activities:Depreciation and amortization
    
    
    19,821
    
    
    
    79,728
    
    
    
    10,447,620Loss on disposal of fixed assets
    
    
    4,269
    
    
    
    59,114
    
    
    
    59,785Loss on fair value of warrants
    
    
    
    
    
    
    
    
    
    
    12,239,688Amortization of debt discount
    
    
    
    
    
    
    
    
    
    
    450,000Forgiveness of employee receivable
    
    
    
    
    
    
    
    
    
    
    30,036Impairment loss  write-off of goodwill
    
    
    
    
    
    
    
    
    
    
    5,702,130Expenses related to employee stock options and
restricted stock issued
    
    
    785,943
    
    
    
    585,437
    
    
    
    9,223,942Expenses related to options issued to non-employees
    
    
    
    
    
    
    
    
    
    
    204,664Expenses paid by issuance of common stock
    
    
    
    
    
    
    
    
    
    
    1,341,372Expenses paid by issuance of warrants
    
    
    
    
    
    
    
    
    
    
    573,357Expenses paid by issuance of preferred stock
    
    
    
    
    
    
    
    
    
    
    142,501Expenses related to stock warrants issued
    
    
    
    
    
    
    
    
    
    
    612,000Equity in loss of investee
    
    
    
    
    
    
    
    
    
    
    178,936In-process research and development
    
    
    
    
    
    
    
    
    
    
    10,422,130Write-off of license agreement
    
    
    
    
    
    
    
    
    
    
    152,866Write-off assets available-for-sale
    
    
    
    
    
    
    
    
    
    
    108,000Cumulative effect of change in accounting principle
    
    
    
    
    
    
    
    
    
    
    25,821Accretion of discount on investments in securities
    
    
    
    
    
    
    
    
    
    
    (1,604,494
    )Changes in assets and liabilities, net of effect
of acquisitions:(Increase) decrease in prepaid and other assets
    
    
    (148,137
    )
    
    
    344,699
    
    
    
    (711,110
    )Increase (decrease) in accounts payable and
accrued liabilities
    
    
    (552,211
    )
    
    
    (2,360,336
    )
    
    
    1,978,184Net cash used in operating activities
    
    
    (8,341,237
    )
    
    
    (12,616,416
    )
    
    
    (106,780,300
    )Cash flows from investing activities:Proceeds from sales and maturities of short-term
investments
    
    
    
    
    
    
    
    
    
    
    112,788,378Purchases of short-term investments
    
    
    
    
    
    
    
    
    
    
    (111,183,884
    )Purchases of property and equipment
    
    
    (28,513
    )
    
    
    
    
    
    
    (1,058,867
    )Proceeds from sale of property and equipment
    
    
    4,379
    
    
    
    16,000
    
    
    
    54,285Purchase of certificate of deposit
    
    
    
    
    
    
    
    
    
    
    (1,016,330
    )
  F-9




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries
 Consolidated Statements of Cash Flows
 Inception(June 12, 1996)ThroughYears Ended December 31,
    
    
    December 31,2010
    
    
    2009
    
    
    2010Maturity of certificate of deposit
    
    $
    
    
    
    $
    
    
    
    $
    1,016,330Cash paid for acquisitions, net of cash
acquired
    
    
    
    
    
    
    
    
    
    
    32,395Payment on obligation under license
agreement
    
    
    
    
    
    
    
    
    
    
    (106,250
    )Issuance of note receivable  related party
    
    
    
    
    
    
    
    
    
    
    (35,000
    )Payments on note receivable
    
    
    
    
    
    
    
    
    
    
    405,993Advance to investee
    
    
    
    
    
    
    
    
    
    
    (90,475
    )Cash transferred in rescission of acquisition
    
    
    
    
    
    
    
    
    
    
    (19,475
    )Cash received in rescission of acquisition
    
    
    
    
    
    
    
    
    
    
    230,000Net cash provided by (used in) investing
activities
    
    
    (24,134
    )
    
    
    16,000
    
    
    
    1,017,100Cash flows from financing activities:Proceeds from sale of common stock
    
    
    
    
    
    
    
    
    
    
    84,151,342Proceeds from exercise of stock options
    
    
    
    
    
    
    
    
    
    
    712,367Proceeds from sale or exercise of warrants
    
    
    317,444
    
    
    
    3,013,920
    
    
    
    14,714,258Proceeds from sale of preferred stock
    
    
    30,453,227
    
    
    
    9,820,500
    
    
    
    44,474,720Repurchase of warrants
    
    
    
    
    
    
    
    
    
    
    (55,279
    )Payments for financing and offering costs
    
    
    (3,093,735
    )
    
    
    (1,416,504
    )
    
    
    (10,994,048
    )Payments on notes payable and long-term debt
    
    
    
    
    
    
    
    
    
    
    (605,909
    )Proceeds from issuance of notes payable and
detachable warrants
    
    
    
    
    
    
    
    
    
    
    1,344,718Cash paid in lieu of fractional shares for
reverse stock split
    
    
    (146
    )
    
    
    
    
    
    
    (146
    )Net cash provided by financing activities
    
    
    27,676,790
    
    
    
    11,417,916
    
    
    
    133,742,023Net increase (decrease) in cash
    
    
    19,311,419
    
    
    
    (1,182,500
    )
    
    
    27,978,823Cash at beginning of period
    
    
    8,667,404
    
    
    
    9,849,904
    
    
    
    Cash at end of period
    
    $
    27,978,823
    
    
    $
    8,667,404
    
    
    $
    27,978,823
   F-10




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries
 
 Notes to Consolidated Financial Statements
 December 31, 2010
 (1)
    
    Description of Business
 ADVENTRX Pharmaceuticals, Inc., a Delaware corporation (ADVENTRX, we or the Company),
is a specialty pharmaceutical company focused on acquiring, developing and commercializing
proprietary product candidates. We have devoted substantially all of our resources to
research and development (R&D), or to acquisition of our product candidates. We have not
yet marketed or sold any products or generated any significant revenue. Through our
acquisition of SD Pharmaceuticals, Inc. (SDP) in 2006, we have rights to product candidates
in varying stages of development, including our lead product candidates, Exelbine
(vinorelbine injectable emulsion) and ANX-514 (docetaxel emulsion for injection), which are
novel emulsion formulations of currently marketed chemotherapy drugs. In February 2011, we
entered into an agreement and plan of merger to acquire SynthRx, Inc., a privately-held
Delaware corporation in exchange for shares of our common stock. See Note 17, Subsequent
Events, below for additional information regarding this pending acquisition.
 In October 2000, we merged our wholly-owned subsidiary, Biokeys Acquisition Corp., with and
into Biokeys, Inc. and changed our name to Biokeys Pharmaceuticals, Inc. In May 2003, we
merged Biokeys Inc., our wholly-owned subsidiary, with and into us and changed our name to
ADVENTRX Pharmaceuticals, Inc. The merger had no effect on our financial statements. In
July 2004, we formed a wholly-owned subsidiary, ADVENTRX (Europe) Ltd., in the United Kingdom
primarily to facilitate conducting clinical trials in the European Union, but we dissolved
this subsidiary in December 2009. In April 2006, we acquired all of the outstanding capital
stock of SDP through a merger with our newly created wholly-owned subsidiary, Speed
Acquisition, Inc. (the Merger Sub) and changed the name of the Merger Sub to SD
Pharmaceuticals, Inc.
 (2)
    
    Summary of Significant Accounting Policies
 Basis of Presentation
 The consolidated financial statements include the accounts of the Company and its
wholly-owned subsidiaries, SDP and ADVENTRX (Europe) Ltd. up until its dissolution in
December 2009. All intercompany accounts and transactions have been eliminated in
consolidation.
 On April 23, 2010, the Company effected a 1-for-25 reverse split of its common stock, which
was authorized by its stockholders at a special meeting held in August 2009. All common
stock share and per share information in the consolidated financial statements and notes
thereto included in this report have been restated to reflect retrospective application of
the reverse stock split for all periods presented ending or as of a date prior to April 23,
2010, except for par value per share and the number of authorized shares, which were not
affected by the reverse stock split.
 Use of Estimates
 The preparation of financial statements in conformity with accounting principles generally
accepted in the United States of America (U.S.) requires management to make estimates and
assumptions that affect the amounts reported in the consolidated financial statements and
accompanying notes. Actual results could differ from those estimates.
 Cash Equivalents
 Cash equivalents consist of highly liquid investments with original maturities of three
months or less at the date of purchase. The carrying amounts approximate fair value due to
the short maturities of these instruments. At December 31, 2010 and 2009, we did not have
any cash equivalents.
  F-11




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries   Notes to Consolidated Financial Statements
 Concentrations
 Financial instruments that potentially subject us to concentrations of credit risk consist
principally of cash and cash equivalents and investment securities. We maintain our cash and
cash equivalents in high-credit quality financial institutions. At times, such balances
exceed federally insured limits. At December 31, 2010 and 2009, our cash was in excess of
the Federal Deposit Insurance Corporation limit and we did not have any cash equivalents or
investment securities.
 During 2010, approximately 13% or $1.4 million of our total vendor payments were made to a
manufacturer that provided process development and scale-up manufacturing services that
assisted us in completing a New Drug Application (NDA) for our lead product candidate,
ANX-530, which we filed with the United States Food and Drug Administration (FDA) in
November 2010. If we were to lose this vendor, our progress toward commercializing Exelbine
would be severely impeded. This vendor also provides process development and scale-up
manufacturing services for our other lead product candidate, ANX-514; however, we are
evaluating alternate vendors with respect to ANX-514. During 2009, approximately 28% or $3.5
million of our total vendor payments were made to the same manufacturer.
 Property and Equipment
 Property and equipment are stated at cost. Depreciation and amortization are calculated
using the straight-line method over the estimated useful lives of the assets. The costs of
improvements that extend the lives of the assets are capitalized. Repairs and maintenance
are expensed as incurred.
 Impairment of Long-Lived Assets
 Long-lived assets with finite lives are evaluated for impairment whenever events or changes
in circumstances indicate that their carrying value may not be recoverable. If the
evaluation indicates that intangibles or long-lived assets are not recoverable (i.e.,
carrying amount is less than the future projected undiscounted cash flows), their carrying
amount would be reduced to fair value. Since inception through December 31, 2010, we
recognized an impairment loss of the value of goodwill in the amount of $5.7 million, which
was recorded in the year ended December 31, 2001.
 Revenue Recognition
 We may enter into revenue arrangements that contain multiple deliverables. In these cases,
revenue is recognized when all of the following criteria are met: (1) persuasive evidence of
an arrangement exists; (2) delivery has occurred or services have been rendered; (3) the
sellers price to the buyer is fixed and determinable; and (4) collectability is reasonably
assured.
 Revenue from licensing agreements is recognized based on the performance requirements of the
agreement. Revenue is deferred for fees received before earned. Nonrefundable upfront fees
that are not contingent on any future performance by us are recognized as revenue when the
revenue recognition criteria are met and the license term commences. Nonrefundable upfront
fees, where we have ongoing involvement or performance obligations, are recorded as deferred
revenue and recognized as revenue over the life of the contract, the period of the
performance obligation or the development period, whichever is appropriate in light of the
circumstances.
 Payments related to substantive, performance-based milestones in an agreement are recognized
as revenue upon the achievement of the milestones as specified in the underlying agreement
when they represent the culmination of the earnings process. Royalty revenue from licensed
products will be recognized when earned in accordance with the terms of the applicable
license agreements.
  F-12




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries   Notes to Consolidated Financial Statements
 We recognize revenues from federal government research grants during the period in which we
receive the grant funds, or their collection is reasonably assured, and we incur the
qualified expenditures.
 Research and Development Expenses
 Research and development (R&D) expenses consist of expenses incurred in performing R&D
activities, including salaries and benefits, facilities and other overhead expenses,
bioequivalence and clinical trials, research-related manufacturing services, contract
services and other outside expenses. R&D expenses are charged to operations as they are
incurred. Advance payments, including nonrefundable amounts, for goods or services that will
be used or rendered for future R&D activities are deferred and capitalized. Such amounts
will be recognized as an expense as the related goods are delivered or the related services
are performed. If the goods will not be delivered, or services will not be rendered, then
the capitalized advance payment is charged to expense.
 Milestone payments that we make in connection with in-licensed technology or product
candidates are expensed as incurred when there is uncertainty in receiving future economic
benefits from the licensed technology or product candidates. We consider the future economic
benefits from the licensed technology or product candidates to be uncertain until such
licensed technology is incorporated into products that, or such product candidates, are
approved for marketing by the FDA or when other significant risk factors are abated. For
expense accounting purposes, management has viewed future economic benefits for all of our
licensed technology or product candidates to be uncertain.
 Payments in connection with our bioequivalence and clinical trials are often made under
contracts with multiple clinical research organizations (CROs) that conduct and manage
these trials on our behalf. The financial terms of these agreements are subject to
negotiation and vary from contract to contract and may result in uneven payment flows.
Generally, these agreements set forth the scope of work to be performed at a fixed fee or
unit price or on a time-and-material basis. Payments under these contracts depend on factors
such as the successful enrollment or treatment of patients or the completion of other
milestones. Expenses related to bioequivalence and clinical trials are accrued based on our
estimates and/or representations from service providers regarding work performed, including
actual level of patient enrollment, completion of patient studies, and trials progress.
Other incidental costs related to patient enrollment and treatment are accrued when
reasonably certain. If the contracted amounts are modified (for instance, as a result of
changes in the bioequivalence or clinical trial protocol or scope of work to be performed),
we modify our accruals accordingly on a prospective basis. Revisions in scope of contract
are charged to expense in the period in which the facts that give rise to the revision become
reasonably certain. Because of the uncertainty of possible future changes to the scope of
work in bioequivalence and clinical trials contracts, we are unable to quantify an estimate
of the reasonably likely effect of any such changes on our consolidated results of operations
or financial position. Historically, we have had no material changes in our bioequivalence
or clinical trial expense accruals that would have had a material impact on our consolidated
results of operations or financial position.
 Purchased In-Process Research and Development
 In accordance with previous accounting guidance effective through December 31, 2008, we
immediately charged the costs associated with in-process research and development (IPR&D)
purchased prior to December 31, 2008 to the statement of operations upon acquisition. These
amounts represented an estimate of the fair value of purchased IPR&D for projects that, as of
the acquisition date, had not yet reached technological feasibility, had no alternative
future use, and had uncertainty in receiving future economic benefits from the purchased
IPR&D. We determined the future economic benefits from the purchased
IPR&D to be uncertain until such technology is incorporated into products approved by the FDA
or when other significant risk factors are abated. In the year ended December 31, 2006, we
recorded approximately $10.4 million of IPR&D expense related to our acquisition of SD
Pharmaceuticals, Inc. in April 2006.
  F-13




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries   Notes to Consolidated Financial Statements
 We will account for future purchased IPR&D in accordance with the Financial Accounting
Standards Boards (FASB) updated guidance for business combinations, which became effective
January 1, 2009.
 Share-Based Compensation
 Share-based compensation cost is measured at the grant date, based on the estimated fair
value of the award and is recognized as expense over the employees requisite service period
on a straight-line basis. Share-based compensation expense recognized in the consolidated
statements of operations for the years ended December 31, 2010 and 2009 is based on awards
ultimately expected to vest and has been reduced for estimated forfeitures. This estimate
will be revised in subsequent periods if actual forfeitures differ from those estimates. We
have no awards with market or performance conditions.
 Patent Costs
 Legal costs in connection with approved patents and patent applications are expensed as
incurred and classified as selling, general and administrative expense in our consolidated
statement of operations.
 Income Taxes
 We account for income taxes and the related accounts under the liability method. Deferred
tax assets and liabilities are determined based on the differences between the financial
statement carrying amounts and the income tax basis of assets and liabilities. A valuation
allowance is applied against any net deferred tax asset if, based on available evidence, it
is more likely than not that some or all of the deferred tax assets will not be realized.
 The tax effects from an uncertain tax position can be recognized in our consolidated
financial statements only if the position is more likely than not of being sustained upon an
examination by tax authorities. An uncertain income tax position will not be recognized if
it has less than a 50% likelihood of being sustained.
 We account for interest and penalties related to income tax matters in income tax expense.
 Comprehensive Loss
 Comprehensive income or loss is defined as the change in equity of a business enterprise
during a period from transactions and other events and circumstances from non-owner sources,
including foreign currency translation adjustments and unrealized gains and losses on
marketable securities. We present comprehensive loss in our consolidated statements of
stockholders equity (deficit) and comprehensive loss.
 Net Loss per Common Share
 Basic and diluted net loss per common share was calculated by dividing the net loss
applicable to common stock for the period by the weighted-average number of common shares
outstanding during the period, without consideration for our outstanding common stock
equivalents because their effect would have been anti-dilutive. Common stock equivalents are
included in the calculation of diluted earnings per common share only if their effect is
dilutive. As of December 31, 2010 and 2009, our outstanding common stock equivalents
consisted of options and warrants as follows:
 2010
    
    
    2009Warrants
    
    
    4,055,030
    
    
    
    946,344Options
    
    
    403,737
    
    
    
    234,3564,458,767
    
    
    
    1,180,700
  F-14




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries   Notes to Consolidated Financial Statements
 Supplemental Cash Flow Information
 Inception(June 12, 1996)ThroughYears Ended December 31,
    
    
    December 31,2010
    
    
    2009
    
    
    2010Supplemental disclosures of cash flow information:Interest paid
    
    $
    1,629
    
    
    $
    
    
    
    $
    180,719Income taxes paid
    
    
    
    
    
    
    
    
    
    
    Supplemental disclosures of non-cash investing and
financing activities:Issuance of warrants, common stock and preferred stock
for:Conversion of notes payable and accrued interest
    
    
    
    
    
    
    
    
    
    
    1,213,988Prepaid services to consultants
    
    
    
    
    
    
    
    
    
    
    1,482,781Conversion of preferred stock
    
    
    7,184
    
    
    
    3,785
    
    
    
    13,674Acquisitions
    
    
    
    
    
    
    
    
    
    
    24,781,555Payment of dividends
    
    
    
    
    
    
    
    
    
    
    213,000Financial advisor services in conjunction with private
placements
    
    
    724,286
    
    
    
    691,812
    
    
    
    2,553,554Acquisition of treasury stock in settlement of a claim
    
    
    
    
    
    
    
    
    
    
    34,737Cancellation of treasury stock
    
    
    
    
    
    
    
    
    
    
    (34,737
    )Assumptions of liabilities in acquisitions
    
    
    
    
    
    
    
    
    
    
    1,235,907Acquisition of license agreement for long-term debt
    
    
    
    
    
    
    
    
    
    
    161,180Cashless exercise of warrants
    
    
    
    
    
    
    
    
    
    
    4,312Dividends accrued
    
    
    
    
    
    
    
    
    
    
    621,040Trade asset converted to available for sale asset
    
    
    
    
    
    
    
    
    
    
    108,000Dividends extinguished
    
    
    
    
    
    
    
    
    
    
    408,240Trade payable converted to note payable
    
    
    
    
    
    
    
    
    
    
    83,948Issuance of warrants for return of common stock
    
    
    
    
    
    
    
    
    
    
    50,852Detachable warrants issued with notes payable
    
    
    
    
    
    
    
    
    
    
    450,000Cumulative preferred stock dividends
    
    
    7,763,903
    
    
    
    5,738,500
    
    
    
    13,502,403
 Recent Accounting Pronouncements
 In October 2009, the FASB issued Accounting Standard Update (ASU) No. 2009-13, Revenue
Recognition (ASC 605)  Multiple-Deliverable Revenue Arrangements, a consensus of the FASB
Emerging Issues Task Force. The guidance modifies the fair value requirements of Accounting
Standards Codification (ASC) subtopic 605-25 Revenue Recognition  Multiple Element
Arrangements by providing principles for allocation of consideration among its multiple
elements, allowing more flexibility in identifying and accounting for separate deliverables
under an arrangement. An estimated selling price method is introduced for valuing the
elements of a bundled arrangement if vendor-specific objective evidence or third-party
evidence of selling price is not available, and significantly expands related disclosure
requirements. This guidance is effective prospectively for revenue arrangements entered
into or materially modified in fiscal years beginning on or after June 15, 2010. Currently,
we have no multiple-deliverable revenue arrangements that would be affected by this
guidance.
 In March 2010, the FASB ratified the milestone method of revenue recognition. Under this
standard, an entity can recognize contingent consideration earned from the achievement of a
substantive milestone in its
entirety in the period in which the milestone is achieved. A milestone is defined as an
event (i) that can only be achieved based in whole or in part on either the entitys
performance or on the occurrence of a specific outcome resulting from the entitys
performance (ii) for which there is substantive uncertainty at the date the arrangement is
entered into that the event will be achieved and (iii) that would result in additional
payments being due to the entity. This guidance is effective for years beginning after June
15, 2010. We are evaluating the effect, if any, that this guidance will have on our
financial position or results of operations.
  F-15




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries   Notes to Consolidated Financial Statements
 (3)
    
    Fair Value Measurements
 The guidance for the fair value option for financial assets and financial liabilities
provides companies the irrevocable option to measure many financial assets and liabilities
at fair value with changes in fair value recognized in earnings. We have not elected to
measure any financial assets or liabilities at fair value that were not previously required
to be measured at fair value.
 Fair value is defined as the exit price, or the amount that would be received to sell an
asset or paid to transfer a liability in an orderly transaction between market participants
as of the measurement date. The guidance also establishes fair value hierarchy for inputs
used in measuring fair value that maximizes the use of observable inputs and minimizes the
use of unobservable inputs by requiring that the most observable inputs be used when
available. Observable inputs are inputs market participants would use in valuing the asset
or liability and are developed based on market data obtained from sources independent of the
Company. Unobservable inputs are inputs that reflect the Companys assumptions about the
factors market participants would use in valuing the asset or liability. The guidance
establishes three levels of inputs that may be used to measure fair value as follows:
 Level 1 
    
    Quoted prices in active markets for identical assets or liabilities.Level 2 
    
    Inputs other than Level 1 that are observable, either directly or
indirectly, such as quoted prices for similar assets or liabilities; quoted prices in
markets that are not active; or other inputs that are observable or can be corroborated
by observable market data for substantially the full term of the assets or liabilities.Level 3 
    
    Unobservable inputs that are supported by little or no market activity
and that are significant to the fair value of the assets or liabilities.
 At December 31, 2010 and 2009, we had no financial assets or liabilities required to be
measured at fair value.
 (4)
    
    Property and Equipment
 Property and equipment at December 31, 2010 and 2009 were as follows:
 Useful Lives
    
    
    2010
    
    
    2009Office furniture, computer and lab equipment
    
    3 - 5 years
    
    $
    216,698
    
    
    $
    293,480Computer software
    
    3 years
    
    
    60,841
    
    
    
    89,422Leasehold improvements
    
    1 year
    
    
    21,733
    
    
    
    299,272
    
    
    
    382,902Less accumulated depreciation and amortization
    
    
    
    
    
    
    (255,018
    )
    
    
    (338,692
    )Property and equipment, net
    
    
    
    
    
    $
    44,254
    
    
    $
    44,210
 At December 31, 2010, there was $14,165 of lab equipment held for sale with an equipment
reseller on a consignment basis.
 Depreciation and amortization expense was $19,821 and $79,728 for the years ended December
31, 2010 and 2009, respectively.
  F-16




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries   Notes to Consolidated Financial Statements
 (5)
    
    Accrued Liabilities
 Accrued liabilities at December 31, 2010 and 2009 were as follows:
 2010
    
    
    2009Accrued contracts and study expenses
    
    $
    381,309
    
    
    $
    1,144,279Other accrued liabilities
    
    
    483,548
    
    
    
    234,731Accrued liabilities
    
    $
    864,857
    
    
    $
    1,379,010
 (6)
    
    Capital Stock and Warrants
 Reverse Stock Split
 At a special meeting of our stockholders held on August 25, 2009, our stockholders approved
a proposal to authorize our board of directors, in its discretion, to effect a reverse split
of our outstanding common stock without further action by our stockholders. In April 2010,
our board of directors approved a 1-for-25 reverse split of our common stock and on April
23, 2010 at 4:01 p.m. Eastern time, the reverse stock split became effective. As a result
of the reverse stock split, each 25 shares of our issued and outstanding common stock were
automatically reclassified as and changed into one share of our common stock. The reverse
stock split reduced the number of our issued and outstanding shares of common stock as of
April 23, 2010 from approximately 257.3 million shares to approximately 10.3 million shares.
No fractional shares were issued in connection with the reverse stock split. Stockholders
who were entitled to fractional shares instead became entitled to receive a cash payment in
lieu of receiving fractional shares (after taking into account and aggregating all shares of
our common stock then held by such stockholder) equal to the fractional share interest
multiplied by $4.6275 (the per share closing price of our common stock (on a post-split
basis) as determined by the NYSE Amex on April 23, 2010). The reverse stock split affected
all of the holders of our common stock uniformly. Shares of our common stock underlying
outstanding options and warrants were proportionately reduced and the exercise prices of
outstanding options and warrants were proportionately increased in accordance with the terms
of the agreements governing such securities. All common stock share and per share
information in the consolidated financial statements and notes thereto included in this
report have been restated to reflect retrospective application of the reverse stock split
for all periods presented ending or as of a date on or prior to April 23, 2010, except for
par value per share and the number of authorized shares, which were not affected by the
reverse stock split.
 0% Series A Convertible Preferred Stock
 In June 2009, we completed a registered direct equity financing raising gross proceeds of
approximately $2.0 million involving the issuance of units consisting of 1,993 shares of our
0% Series A Convertible Preferred Stock with a stated value of $1,000 per share (Series A
Stock) and 5-year warrants to purchase up to 324,651 shares of our common stock at an
exercise price of $3.75 per share. In the aggregate, the shares of Series A Stock we issued
were convertible into 721,448 shares of our common stock. All of the shares of the Series A
Stock have been converted into common stock and are no longer outstanding. We received
approximately $1.7 million in net proceeds from the financing, after deducting the placement
agents fees and expenses and other offering expenses. In December 2009, in connection with
the exercise of warrants issued in the June 2009 financing, we issued 240,000 shares of our
common stock and received net proceeds of $0.9 million. In January 2010, in connection with
the exercise of the remaining warrants issued in the June 2009 financing, we issued an
additional 84,651 shares of our common stock and received an additional $0.3 million of net
proceeds. All of the warrants we issued in the June 2009 financing have been exercised and
are no longer outstanding.
  F-17




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries   Notes to Consolidated Financial Statements
 The convertible feature of our Series A Stock and the terms of the warrants issued in
connection with our Series A Stock provided for a rate of conversion or exercise that was
below the market value of our common stock at issuance. The convertible feature of our
Series A Stock is characterized as a beneficial conversion feature (BCF). The estimated
relative fair values of the shares of our Series A Stock and the warrants issued in
connection with such stock were calculated as approximately $1.2 million and $531,000,
respectively. The value of the BCF was determined using the intrinsic value method and
calculated as approximately $1.2 million. Because our Series A Stock did not have a stated
redemption date, the value of the BCF was fully realized at the time our Series A Stock was
issued. The fair value of the warrants was determined using the Black-Scholes
option-pricing model as of the date of issuance assuming a five-year term, stock volatility
of 197.01%, and a risk-free interest rate of 2.81%. The value of the BCF was treated as a
deemed dividend to the holders of our Series A Stock and, due to the potential immediate
convertibility of our Series A Stock at issuance, was recorded as an increase to additional
paid-in capital and accumulated deficit at the time of issuance.
 We also issued warrants to purchase up to 36,071 shares of our common stock at an exercise
price of $3.75 per share to the placement agent in the June 2009 financing as additional
consideration for its services in connection with the financing. These warrants had a fair
value of approximately $132,000 using the Black-Scholes option-pricing model as of the date
of issuance assuming a five-year term, stock volatility of 196.5%, and a risk-free interest
rate of 2.85%. The warrants became exercisable on December 13, 2009 and are exercisable at
any time on or before June 12, 2014.
 5% Series B Convertible Preferred Stock
 In July 2009, we completed a registered direct equity financing raising gross proceeds of
approximately $1.4 million involving the issuance of 1,361 shares of our 5% Series B
Convertible Preferred Stock with a stated value of $1,000 per share (Series B Stock). In
the aggregate, the shares of Series B Stock we issued were convertible into 380,168 shares
of our common stock. All of the shares of our Series B Stock have been converted into
common stock and are no longer outstanding. Our Series B Stock would have accrued a
cumulative annual dividend of 5% per share until July 6, 2014, and no dividend thereafter.
In accordance with the terms of the Series B Stock, because the Series B Stock was converted
prior to July 6, 2014, we paid the holders an amount equal to the total dividend that would
have accrued in respect of the shares converted from the issuance date through July 6, 2014,
or $250 per $1,000 of stated value of the shares converted. We received approximately $0.8
million in net proceeds from the financing after deducting the $340,250 we placed into
escrow accounts to pay the aggregate dividend payment in respect of our Series B Stock,
placement agents fees and expenses and other offering expenses.
 The convertible feature of our Series B Stock and the value of the dividend in respect
thereof provided for a rate of conversion that was below the market value of our common
stock at issuance. The convertible feature of our Series B Stock is characterized as a BCF.
The estimated relative fair value of the shares of our Series B Stock was calculated as
approximately $1.0 million. The value of the BCF was determined using the intrinsic value
method and calculated as approximately $215,000. Because our Series B Stock did not have a
stated redemption date, the value of the BCF was fully realized at the time our Series B
Stock was issued. The value of the BCF was treated as a deemed dividend to the holders of
our Series B Stock and, due to the potential immediate convertibility of our Series B Stock
at issuance, was recorded as an increase to additional paid-in capital and accumulated
deficit at the time of issuance.
 We also issued warrants to purchase up to 19,007 shares of our common stock at an exercise
price of $4.48 per share to the placement agent in the July 2009 financing as additional
consideration for its services in connection with the financing. These warrants had a fair
value of approximately $60,000 using the Black-Scholes option-pricing model as of the date
of issuance assuming a five-year term, stock volatility of 197.37%, and a risk-free interest
rate of 2.4%. The warrants became exercisable on January 7, 2010 and are exercisable at any
time on or before July 6, 2014.
  F-18




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries   Notes to Consolidated Financial Statements
 5% Series C Convertible Preferred Stock
 In August 2009, we completed a registered direct equity financing raising gross proceeds of
approximately $0.9 million involving the issuance of 922 shares of our 5% Series C
Convertible Preferred Stock with a stated value of $1,000 per share (Series C Stock). In
the aggregate, the shares of Series C Stock we issued were convertible into 283,692 shares
of our common stock. All of the shares of our Series C Stock have been converted into
common stock and are no longer outstanding. Our Series C Stock would have accrued a
cumulative annual dividend of 5% per share until February 10, 2012, and no dividend
thereafter. In accordance with the terms of the Series C Stock, because the Series C Stock
was converted prior to February 10, 2012, we paid the holders an amount equal to the total
dividend that would have accrued in respect of the shares converted from the issuance date
through February 10, 2012, or $125 per $1,000 of stated value of the shares converted. We
received approximately $0.7 million in net proceeds from the financing after deducting the
$115,250 we placed into escrow accounts to pay the aggregate dividend payment in respect of
our Series C Stock, placement agents fees and expenses and other offering expenses.
 The convertible feature of our Series C Stock and the value of the dividend in respect
thereof provided for a rate of conversion that was below the market value of our common
stock at issuance. The convertible feature of our Series C Stock is characterized as a BCF.
The estimated relative fair value of the shares of our Series C Stock was calculated as
approximately $807,000. The value of the BCF was determined using the intrinsic value
method and calculated as approximately $186,000. Because our Series C Stock did not have a
stated redemption date, the value of the BCF was fully realized at the time our Series C
Stock was issued. The value of the BCF was treated as a deemed dividend to the holders of
our Series C Stock and, due to the potential immediate convertibility of our Series C Stock
at issuance, was recorded as an increase to additional paid-in capital and accumulated
deficit at the time of issuance.
 We also issued warrants to purchase up to 14,183 shares of our common stock at an exercise
price of $4.06 per share to the placement agent in the August 2009 financing as additional
consideration for its services in connection with the financing. These warrants had a fair
value of approximately $48,000 using the Black-Scholes option-pricing model as of the date
of issuance assuming a five-year term, stock volatility of 198.94%, and a risk-free interest
rate of 2.75%. The warrants became exercisable on February 10, 2010 and are exercisable at
any time on or before August 10, 2014.
 4.25660% Series D Convertible Preferred Stock
 In October 2009, we completed a registered direct equity financing raising gross proceeds of
approximately $11.3 million involving the issuance of units consisting of 11,283 shares of
our 4.25660% Series D Convertible Preferred Stock with a stated value of $1,000 per share
(Series D Stock) and 5-year warrants to purchase up to an aggregate of 792,000 shares of
our common stock. In the aggregate, the shares of Series D Stock we issued were convertible
into 2,400,000 shares of our common stock. All of the shares of our Series D Stock have
been converted into common stock and are no longer outstanding. Our Series D Stock would
have accrued a cumulative annual dividend of 4.25660% per share until October 9, 2020, and
no dividend thereafter. In accordance with the terms of the Series D Stock, because the
Series D Stock was converted prior to October 9, 2020, we paid the holders an amount equal
to the total dividend that would have accrued in respect of the shares converted from the
issuance date through October 9, 2020, or $468.23 per $1,000 of stated value of the shares
converted. We received approximately $5.1 million in net proceeds from the financing after
deducting the approximately $5.3 million we placed into escrow accounts to pay the aggregate
dividend payment in respect of our Series D Stock, placement agents fees and expenses and
other offering expenses. In December 2009, in connection with the exercise of warrants
issued in the October 2009 financing, we issued 576,000 shares of our common stock and
received net proceeds of $2.1 million. We may receive an additional $0.8 million of net
proceeds from the exercise of the remaining warrants issued in the October 2009 financing.
Those warrants, which have an exercise price of $3.67 per share, are exercisable any time on
or before October 9, 2014, subject to certain beneficial ownership limitations.
  F-19




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries   Notes to Consolidated Financial Statements
 The convertible feature of our Series D Stock and the terms of the warrants issued in
connection with our Series D Stock provide for a rate of conversion or exercise that was
below the market value of our common stock at issuance. The convertible feature of our
Series D Stock is characterized as BCF. The estimated relative fair values of the shares of
our Series D Stock and the warrants issued in connection with such stock were calculated as
approximately $3.9 million and $1.3 million, respectively. The value of the BCF was
determined using the intrinsic value method and calculated as approximately $3.3 million.
Because our Series D Stock did not have a stated redemption date, the value of the BCF was
fully realized at the time our Series D Stock was issued. The fair value of the warrants
was determined using the Black-Scholes option-pricing model as of the date of issuance
assuming a five-year term, stock volatility of 197.63%, and a risk-free interest rate of
2.36%. The value of the BCF was treated as a deemed dividend to the holders of our Series D
Stock and, due to the potential immediate convertibility of our Series D Stock at issuance,
was recorded as an increase to additional paid-in capital and accumulated deficit at the
time of issuance.
 We also issued warrants to purchase up to 144,000 shares of our common stock at an exercise
price of $5.88 per share to the placement agent in the October 2009 financing as additional
consideration for its services in connection with the financing. These warrants had a fair
value of approximately $452,000 using the Black-Scholes option-pricing model as of the date
of issuance assuming a five-year term, stock volatility of 197.63%, and a risk-free interest
rate of 2.36%. The warrants became exercisable on April 7, 2010 and are exercisable at any
time on or before October 6, 2014.
 3.73344597664961% Series E Convertible Preferred Stock
 In January 2010, we completed a registered direct equity financing raising gross proceeds of
$19.0 million involving the issuance of units consisting of 19,000 shares of our
3.73344597664961% Series E Convertible Preferred Stock with a stated value of $1,000 per
share (Series E Stock) and 30-month warrants to purchase up to an aggregate of 498,488
shares of our common stock. In the aggregate, the shares of Series E Stock we issued were
convertible into 1,993,965 shares of our common stock. All of the shares of our Series E
Stock have been converted into common stock and are no longer outstanding. Our Series E
Stock would have accrued a cumulative annual dividend of 3.73344597664961% per share until
January 7, 2015, and no dividend thereafter. In accordance with the terms of the Series E
Stock, because the Series E Stock was converted prior to January 7, 2015, we paid the
holders an amount equal to the total dividend that would have accrued in respect of the
 shares converted from the issuance date through January 7, 2015, or $186.67 per $1,000 of
stated value of the shares converted. We received approximately $14.0 million in net
proceeds from the financing after deducting the approximately $3.5 million we placed into
escrow accounts to pay the aggregate dividend payment in respect of our Series E Stock,
placement agents fees and expenses and other offering expenses. We may receive up to
approximately $4.4 million of additional proceeds from the exercise of the warrants issued
in the January 2010 financing. Those warrants, which have an exercise price of $8.75 per
share, are exercisable any time on or before July 6, 2012, subject to certain beneficial
ownership limitations.
 The convertible feature of our Series E Stock and the terms of the warrants issued in
connection with our Series E Stock provide for a rate of conversion or exercise that was
below the market value of our common stock at issuance. The convertible feature of our
Series E Stock is characterized as BCF. The estimated relative fair values of the shares of
our Series E Stock and the warrants issued in connection with such stock were calculated as
approximately $12.4 million and $3.0 million, respectively. The value of the BCF was
determined using the intrinsic value method and calculated as approximately $2.5 million.
Because our Series E Stock did not have a stated redemption date, the value of the BCF was
fully realized at the time our Series E Stock was issued. The fair value of the warrants
was determined using the Black-Scholes option-pricing model as of the date of issuance
assuming a 30-month term, stock volatility of 275.79%, and a risk-free interest rate of
1.325%. The value of the BCF was treated as a deemed dividend to the holders of our Series
E Stock and, due to the potential immediate convertibility of our Series E Stock at
issuance, was recorded as an increase to additional paid-in capital and accumulated deficit
at the time of issuance.
  F-20




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries   Notes to Consolidated Financial Statements
 We also issued warrants to purchase up to 99,696 shares of our common stock at an exercise
price of $11.91 per share to the placement agent in the January 2010 financing as additional
consideration for its services in connection with the financing. These warrants had a fair
value of approximately $724,000 using the Black-Scholes option-pricing model as of the date
of issuance assuming a 4.5-year term, stock volatility of 209.46%, and a risk-free interest
rate of 2.37%. The warrants became exercisable on July 7, 2010 and are exercisable at any
time on or before June 3, 2014.
 2.19446320054018% Series F Convertible Preferred Stock
 In May 2010, we completed a registered direct equity financing raising gross proceeds of
$19.2 million involving the issuance of units consisting of 19,217.13 shares of our
2.19446320054018% Series F Convertible Preferred Stock with a stated value of $1,000 per
share (Series F Stock), 5-year warrants to purchase up to an aggregate of 1,816,608 shares
of our common stock and 1-year warrants to purchase up to an aggregate of 778,548 shares of
our common stock. In the aggregate, the shares of Series F Stock we issued were convertible
into 5,190,312 shares of our common stock. All of the shares of our Series F Stock have
been converted into common stock and are no longer outstanding. Series F Stock would have
accrued a cumulative annual dividend of 2.19446320054018% per share until May 6, 2020, and
no dividend thereafter. In accordance with the terms of the Series F Stock, because the
Series F Stock was converted prior to May 6, 2020, upon conversion of the shares, we paid
the holders an amount equal to the total dividend that would have accrued in respect of the
 shares converted from the issuance date through May 6, 2020, or $219.45 per $1,000 of stated
value of the shares converted, less the amount of any dividend paid on such shares before
their conversion. Dividend payments were due on January 1, April 1, July 1 and October 1.
Because 2,884.57 shares of our Series F Stock were outstanding at the time of the July 1,
2010 and October 1, 2010 dividend payment dates, we paid aggregate dividends of
approximately $25,300 to the holders of those outstanding shares and such previously paid
amounts were subtracted from the payments due in respect of those shares at the time of
their conversion. We received approximately $13.3 million in net proceeds from the
financing after deducting the approximately $4.2 million we placed into escrow accounts to
pay the aggregate dividend payment in respect of our Series F Stock, placement agent and
financial advisor fees and other offering expenses. We may receive up to approximately $9.5
million of additional proceeds from the exercise of the warrants issued in the May 2010
financing. The exercise price of the warrants is $3.65 per share. Subject to certain
beneficial ownership limitations, the 5-year warrants are exercisable any time on or before
May 6, 2015 and the 1-year warrants are exercisable any time on or before May 20, 2011.
 The convertible feature of our Series F Stock and the terms of the warrants issued in
connection with our Series F Stock provide for a rate of conversion or exercise that was
below the market value of our common stock at issuance. The convertible feature of our
Series F Stock is characterized as BCF. The estimated relative fair values of the shares of
our Series F Stock and the warrants issued in connection with such stock were calculated as
approximately $10.1 million and $4.9 million, respectively. The value of the BCF was
determined using the intrinsic value method and calculated as approximately $3.1 million.
Because our Series F Stock did not have a stated redemption date, the value of the BCF was
fully realized at the time our Series F Stock was issued. The fair value of the 5-year
warrants was determined using the Black-Scholes option-pricing model as of the date of
issuance assuming a 5-year term, stock volatility of 202%, and a risk-free interest rate of
2%. The fair value of the 1-year warrants was determined using the Black-Scholes
option-pricing model as of the date of issuance assuming a 1-year term, stock volatility of
361%, and a risk-free interest rate of 0.4%. The value of the BCF was treated as a deemed
dividend to the holders of our Series F Stock and, due to the potential immediate
convertibility of our Series F Stock at issuance, was recorded as an increase to additional
paid-in capital and accumulated deficit at the time of issuance.
 Common Stock Issued for Warrants Exercised
 As described above, in December 2009, we issued 240,000 shares of our common stock and
received net proceeds of $0.9 million, in connection with the exercise of warrants issued in
the June 2009 financing at an exercise price of $3.75.
  F-21




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries   Notes to Consolidated Financial Statements
 As described above, in December 2009, we issued 576,000 shares of our common stock and
received net proceeds of $2.1 million in connection with the exercise of warrants issued in
the October 2009 financing at an exercise price of $3.67.
 As described above, in January 2010, we issued 84,651 shares of our common stock and
received net proceeds of $0.3 million in connection with the exercise of the remaining
warrants issued in the June 2009 financing at an exercise price of $3.75 per share.
 Warrants
 During 2009, warrants were issued to investors in conjunction with the Series A Stock and
Series D Stock financings in June and October 2009, respectively. The Series A warrants to
investors have been fully exercised as described above. In addition, warrants were issued
to the placement agent in each of the Series A Stock, Series B Stock, Series C Stock and
Series D Stock financings in June 2009, July 2009, August 2009 and October 2009,
respectively. See details of the equity financings above.
 During 2010, warrants were issued to investors in conjunction with the Series E Stock and
Series F Stock financings in January 2010 and May 2010, respectively. In addition, warrants
were issued to the placement agent of the Series E Stock financing in January 2010. See
details of the equity financings above.
 At December 31, 2010, outstanding warrants to purchase shares of common stock are as
follows:
 Warrants
    
    Exercise Price
    
    
    Expiration Date432,429
    
    $
    56.5000
    
    
    July 201236,071
    
    $
    3.7500
    
    
    June 201419,007
    
    $
    4.4750
    
    
    July 201414,183
    
    $
    4.0625
    
    
    August 2014216,000
    
    $
    3.6700
    
    
    October 2014144,000
    
    $
    5.8750
    
    
    October 2014498,488
    
    $
    8.7475
    
    
    July 201299,696
    
    $
    11.9125
    
    
    June 20141,816,608
    
    $
    3.6500
    
    
    May 2015778,548
    
    $
    3.6500
    
    
    May 20114,055,030
 (7)
    
    Equity Incentive Plans
 At December 31, 2010, we had the 2005 Equity Incentive Plan (the 2005 Plan), the 2005
Employee Stock Purchase Plan (the Purchase Plan), and the 2008 Omnibus Incentive Plan (the
2008 Plan) which are described below. The share-based compensation expense from all stock
options granted that has been charged to our consolidated statements of operations in the
years ended December 31, 2010 and 2009 was comprised of the following:
 Years Ended December 31,2010
    
    
    2009Selling, general and administrative expense
    
    $
    791,688
    
    
    $
    543,868Research and development expense
    
    
    (5,745
    )
    
    
    41,569Share-based compensation expense before taxes
    
    
    785,943
    
    
    
    585,437Related income tax benefits
    
    
    
    
    
    
    Share-based compensation expense
    
    $
    785,943
    
    
    $
    585,437Net share-based compensation expense per common
share  basic and diluted
    
    $
    0.06
    
    
    $
    0.13
  F-22




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries   Notes to Consolidated Financial Statements
 Since we have net operating loss carry forwards as of December 31, 2010, no excess tax
benefits for the tax deductions related to share-based awards were recognized in the
consolidated statement of operations. Additionally, no incremental tax benefits were
recognized, as there were no stock options exercised in the years ended December 31, 2010
and 2009 that would have resulted in a reclassification to reduce net cash provided by
operating activities with an offsetting increase in net cash provided by financing
activities.
 2005
    
    Equity Incentive Plan and 2008 Omnibus Incentive Plan
 The 2005 and the 2008 Plans, which are stockholder-approved, are intended to encourage
ownership of shares of common stock by our directors, officers, employees, consultants and
advisors and to provide additional incentive for them to promote the success of our business
through the grant of share-based awards. Both plans provide for the grant of incentive and
non-statutory stock options as well as share appreciation rights, restricted shares,
restricted share units, performance units, shares and other share-based awards. Since the
2008 Plan was approved by the Companys stockholders in May 2008, no awards have been or
will be granted under the 2005 Plan. Share-based awards are subject to terms and conditions
established by our board of directors or the compensation committee of our board of
directors.
 As of December 31, 2010, the maximum aggregate number of shares of common stock that may be
issued pursuant to or subject to the foregoing types of awards granted under the 2008 Plan
is 755,348 shares. Any shares of common stock that are subject to options or stock
appreciation rights granted under the 2008 Plan shall be counted against this limit as one
share of common stock for every one share of common stock granted. Any shares of common
stock that are subject to awards other than options or stock appreciation rights granted
under the 2008 Plan shall be counted against this limit as 1.2 shares of common stock for
every one share of common stock granted. If any shares of common stock subject to an award
under the 2008 Plan or the 2005 Plan are forfeited, expire or are settled for cash pursuant
to the terms of an award, the shares subject to the award may be used again for awards under
the 2008 Plan to the extent of the forfeiture, expiration or settlement. The shares of
common stock will be added back as one share for every share of common stock if the shares
were subject to options or stock appreciation rights granted under the 2008 Plan or under
the 2005 Plan, and as 1.2 shares for every share of common stock if the shares were subject
to awards other than options or stock appreciation rights granted under the 2008 Plan or the
2005 Plan. The following shares of common stock will not be added to the shares issuable
under the 2008 Plan: (i) shares tendered by the participant or withheld by the Company in
payment of the purchase price of an option, (ii) shares tendered by the participant or
withheld by the Company to satisfy tax withholding with respect to an award, and (iii)
 shares subject to a stock appreciation right that are not issued in connection with the
stock settlement of the stock appreciation right on exercise. Shares of common stock under
awards made in substitution or exchange for awards granted by a company acquired by the
Company, or with which the Company combines, do not reduce the maximum number of shares that
may be issued under the 2008 Plan. In addition, if a company acquired by the Company, or
with which the Company combines, has shares remaining available under a plan approved by its
stockholders, the available shares (adjusted to reflect the exchange or valuation ratio in
the acquisition or combination) may be used for awards under the 2008 Plan and will not
reduce the maximum number of shares of common stock that may be issued under the 2008 Plan;
provided, however that awards using such available shares shall not be made after the date
awards or grants could have been made under the pre-existing plan, absent the acquisition or
combination, and shall only be made to individuals who were not our employees or directors
prior to the acquisition or combination.
 Under the 2008 Plan, the purchase price of shares of common stock covered by a stock option
cannot be less than 100% of the fair market value of the common stock on the date the option
is granted. Fair market value of the common stock is generally equal to the closing price
for the common stock on the principal securities exchange on which the common stock is
traded on the date the option is granted (or if there was no closing price on that date, on
the last preceding date on which a closing price is reported). Option awards generally have
ten-year contractual terms and vest over four years based on continuous service; however,
the 2005 Plan and the 2008 Plan allow for other vesting periods and we have granted
employees
options where the requisite service period is three years and we have granted our
non-employee directors options where the requisite service period is three years, one year
and, in one case, four months.
  F-23




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries   Notes to Consolidated Financial Statements
 We canceled options exercisable for 34,000 and 76,229 shares of common stock in the years
ended December 31, 2010 and 2009, respectively, held by employees and directors whose
service to our company terminated during those respective periods. The shares underlying
such options were returned to and are available for re-issuance under the 2008 Plan pursuant
to the terms described above.
 During the year ended December 31, 2010, all awards granted under the 2008 Plan were stock
options. During the year ended December 31, 2009, the awards granted under the 2008 Plan
were stock options and restricted stock units. All the restricted stock units granted in
the first quarter of 2009 were subsequently canceled in the first, second and third quarters
of 2009. A summary of all of our option activity as of December 31, 2010 and 2009 and of
changes in options outstanding under the plans during the year ended December 31, 2010 are
as follows:
 Weighted-Weighted-
    
    
    AverageAverage
    
    
    Remaining
    
    
    AggregateExercise
    
    
    Contractual
    
    
    IntrinsicShares
    
    
    Price
    
    
    Years
    
    
    ValueOutstanding at December 31, 2009
    
    
    234,356
    
    
    $
    19.98Granted
    
    
    203,381
    
    
    $
    7.20Exercised
    
    
    
    
    
    
    Cancelled/forfeited/expired
    
    
    (34,000
    )
    
    $
    33.62Outstanding at December 31, 2010
    
    
    403,737
    
    
    $
    12.39
    
    
    
    8.46
    
    
    $
    19,600Options exercisable at December 31, 2010
    
    
    121,464
    
    
    $
    26.88
    
    
    
    7.56
    
    
    $
    9,800Vested and expected to vest at December
31, 2010
    
    
    370,416
    
    
    $
    12.91
    
    
    
    8.42
    
    
    $
    19,438
 The weighted-average grant-date fair value of options granted during the years ended
December 31, 2010 and 2009 was $6.91 and $3.18, respectively. As of December 31, 2010,
there was approximately $1.1 million of unamortized compensation cost related to unvested
stock option awards, which is expected to be recognized over a weighted-average period of
approximately 2.5 years.
 There were no options exercised during the years ended December 31, 2010 and 2009.
 Our determination of fair value is affected by our stock price as well as a number of
assumptions that require judgment. The fair value of each option award is estimated on the
date of grant using the Black-Scholes option-valuation model. The assumptions used in the
Black-Scholes option-valuation model for option grants to employees and non-employee
directors during the years ended December 31, 2010 and 2009 are as follows:
 Years Ended December 31,2010
    
    
    2009Risk-free interest rate
    
    
    1.8  2.7
    %
    
    
    2.7
    %Dividend yield
    
    
    0.0
    %
    
    
    0.0
    %Expected volatility
    
    
    188  202
    %
    
    
    183
    %Expected term (in years)
    
    5  6 years
    
    
    6 years
  F-24




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries   Notes to Consolidated Financial Statements
 The risk-free interest rate assumption is based on the U.S. Treasury yield for a period
consistent with the expected term of the option in effect at the time of the grant. We have
not paid any dividends on common stock since our inception and do not anticipate paying
dividends on our common stock in the foreseeable future. The expected option term is
computed using the simplified method as permitted under the provisions of Staff Accounting
Bulletin (SAB 107). SAB 107s guidance was extended indefinitely by SAB 110. The
expected volatility is based on the historical volatility of our common stock based on the
daily close prices.
 No options were granted to consultants in 2010 and 2009. We recognized $0 in share-based
compensation expense associated with non-employee options in the years ended December 31,
2010 and 2009. In accordance with ASC 718, Compensation  Stock Compensation,
share-based compensation expense associated with the non-employee director options is
included with employee share-based compensation expense.
 The following table summarizes information concerning our outstanding and exercisable stock
options as of December 31, 2010:
 Options Outstanding
    
    
    Options ExercisableWeighted-Average
    
    
    Weighted-
    
    
    
    
    
    
    Weighted-Remaining
    
    
    Average
    
    
    
    
    
    AverageNumber
    
    
    Contractual
    
    
    Exercise
    
    
    Number
    
    
    ExerciseRange of Exercise Price
    
    Outstanding
    
    
    Life
    
    
    Price
    
    
    Exercisable
    
    
    Price$1.63 to $3.25
    
    
    155,998
    
    
    
    8.67
    
    
    $
    3.04
    
    
    
    44,000
    
    
    $
    2.88$5.91 to $8.00
    
    
    183,381
    
    
    
    9.10
    
    
    $
    7.79
    
    
    
    22,888
    
    
    $
    8.00$9.25 to $13.50
    
    
    28,000
    
    
    
    6.92
    
    
    $
    11.88
    
    
    
    18,400
    
    
    $
    11.03$57.50 to $118.75
    
    
    36,358
    
    
    
    5.53
    
    
    $
    76.04
    
    
    
    36,176
    
    
    $
    76.08403,737
    
    
    
    8.46
    
    
    $
    12.39
    
    
    
    121,464
    
    
    $
    26.88
 Employee Stock Purchase Plan
 The Purchase Plan was approved by our stockholders in 2005; however, we have not implemented
the Purchase Plan. The Purchase Plan allows all eligible employees to purchase shares of
common stock at 85% of the lower of the fair market value on the first or the last day of
each offering period. Employees may authorize us to withhold up to 15% of their
compensation during any offering period, subject to certain limitations. The maximum
aggregate number of shares of common stock that may be issued under the Purchase Plan is
186,945 as of December 31, 2010. This maximum number is subject to an annual automatic
increase on January 1 of each year equal to the lesser of (i) 1% of the number of
outstanding shares of common stock on such day, (ii) 30,000 or (iii) such other amount as
our board of directors may specify. At December 31, 2010, no shares of common stock have
been issued under the Purchase Plan. On January 1, 2011, the number of shares of common
stock available for issuance under the Purchase Plan increased by 30,000 in accordance with
the provisions for annual increases under the Purchase Plan.
 (8)
    
    Commitments
 Operating Leases
 We are obligated under operating leases for office space and equipment. In July 2004, we
entered into a lease for office space in a facility in San Diego, California that served as
our headquarters. In June 2005, we leased additional space in the same facility. During
May 2009, the lease was extended for only a portion of the office space. The lease was set
to expire in August 2009 and we vacated an additional portion of the facility at that time.
During December 2009, we amended the lease to extend its term for an additional eight months
through January 31, 2011. During February 2010, we further amended the lease to lease
adjacent office space through January 31, 2011, and to terminate our obligations with
respect to the office space we were then occupying, effective March 1, 2010. During the
year ended December 31, 2009,
our average monthly office lease payment was $14,700 per month. During the year ended
December 31, 2010, our average monthly office lease payment was $6,400 per month. We lease
copiers and an automobile, which leases expire in 2015 and 2011, respectively.
  F-25




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries   Notes to Consolidated Financial Statements
 In December 2010, we entered into a new lease for office space at a different facility in
San Diego, California to serve as our headquarters, effective January 1, 2011. The term of
the new lease will expire January 31, 2012, unless we exercise our option to extend the
lease an additional 12 months. The average base rent for this space is approximately
$15,600 per month.
 Rent expense was approximately $99,000 and $203,000 during the years ended December 31, 2010
and 2009, respectively.
 Future rental commitments under all operating leases are as follows:
 Year Ending December 31,2011
    
    $
    205,5622012
    
    
    25,2602013
    
    
    8,3262014
    
    
    8,3262015
    
    
    694Total
    
    $
    248,168
 (9)
    
    Licensing Revenue
 In June 2010, we announced that we had entered into a license agreement with respect to our
know-how to develop, make, use and sell ANX-510, or CoFactor®
(5,10-methylenetetrahydrofolate), with Theragence, Inc., a California corporation
(Theragence). Pursuant to the agreement, we granted to Theragence an exclusive worldwide
license, including the right to grant sublicenses under certain circumstances, to conduct
research on and to develop, make, have made, use, offer for sale, sell, have sold and import
licensed products in any field or use. We are entitled to receive royalties on net sales of
licensed products and commercial milestone payments of up to approximately $30 million based
on aggregate gross sales of licensed products in the United States, European Union and
Japan. Theragence agreed to use commercially reasonable efforts to research, develop and
commercialize at least one licensed product. We discontinued active work on our CoFactor
program in October 2008.
 In March 2009, we announced that we and our wholly-owned subsidiary, SD Pharmaceuticals,
Inc., had entered into a license agreement with respect to our product candidate ANX-514
(docetaxel emulsion for injection) with Shin Poong Pharmaceutical Co., Ltd., a company
organized under the laws of the Republic of Korea (Shin Poong), pursuant to which we
granted to Shin Poong an exclusive license, including the right to sublicense, to research,
develop, make, have made, use, offer for sale, sell and import licensed products, in each
case solely for the treatment of cancer by intravenous administration of formulations of
docetaxel as emulsified products and solely in South Korea. Under the terms of the
agreement, we received an upfront licensing fee of $0.3 million, and are entitled to receive
a regulatory milestone payment of either $0.2 million or $0.4 million upon receipt of
regulatory approval for marketing a licensed product in South Korea (the amount depends on
whether the Korea Food and Drug Administration requires Shin Poong to conduct a
bioequivalence or clinical study in human subjects prior to receipt of regulatory approval),
one-time commercial milestone payments tied to annual net sales of licensed products in an
aggregate amount of up to $1.5 million and royalty payments on net sales of licensed
products. Shin Poong is responsible for all development and commercial activities related
to ANX-514 in South Korea. We agreed to pay Shin Poong $0.1 million if the Korea Food and
Drug Administration required Shin Poong to conduct a bioequivalence or clinical trial in
human subjects prior to receipt of regulatory approval and we elect not to supply product to
conduct such trial, which supply obligation is subject to limitations.
  F-26




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries   Notes to Consolidated Financial Statements
 We received the $0.3 million upfront licensing fee in April 2009. We recognized $0.3
million in licensing revenue in the three-month period ended March 31, 2009 because the
criteria under our revenue recognition policy were met in that period.
 In September 2010, pursuant to the terms of the license agreement, we elected to make the
$0.1 million cash payment to Shin Poong in lieu of supplying product for the ANX-514 trial
in human subjects required by the Korea Food and Drug Administration.
 (10)
    
    Grant Revenue
 In November 2010, the Internal Revenue Service notified us that an aggregate amount of
$488,959 in grants had been awarded to us under the qualifying therapeutic discovery project
(QTDP) program established under Section 48D of the Internal Revenue Code as a result of
the Patient Protection and Affordable Care Act of 2010. We submitted applications in July
2010 for qualified investments we made, or expected to make, in 2009 and 2010 in our
ANX-530, or Exelbine, and ANX-514 programs, and a grant in the amount of $244,479 was
approved for each of those programs. These grants are not taxable for federal income tax
purposes. We received full payment of the grants in November 2010, all of which we
recognized as revenue in the three month period ended December 31, 2010 because the criteria
under our revenue recognition policy were met in that period.
 (11)
    
    Income Taxes
 Due to our historical net loss position, and as we have recorded a full valuation allowance
against net deferred tax assets, there is no provision or benefit for income taxes recorded
for the years ended December 31, 2010 and 2009.
 The income tax provision/(benefit) is different from that which would be obtained by
applying the statutory Federal income tax rate of 34% to income before income tax expense.
The items causing this difference for the years ended December 31, 2010 and 2009 are as
follows:
 December 31,2010
    
    
    2009Income tax benefit at federal statutory rate
    
    $
    (2,873,000
    )
    
    $
    (3,851,000
    )R & D credit
    
    
    1,625,000
    
    
    
    (150,000
    )Stock options
    
    
    164,000
    
    
    
    770,000Net operating true-ups
    
    
    26,574,000
    
    
    
    (20,000
    )Other
    
    
    (163,000
    )
    
    
    62,000Change in federal valuation allowance
    
    
    (25,327,000
    )
    
    
    3,189,000Total
    
    $
    
    
    
    $
    
  F-27




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries   Notes to Consolidated Financial Statements
 Deferred income taxes reflect the net tax effect of temporary differences between the
carrying amount of assets and liabilities for financial reporting purposes and the amounts
used for income tax purposes. Significant components of deferred tax assets and liabilities
at December 31, 2010 and 2009 are as follows:
 December 31,2010
    
    
    2009Deferred tax assets:Accrued expenses
    
    $
    57,252
    
    
    $
    85,538Stock options expense under ASC 718
    
    
    1,129,227
    
    
    
    1,008,517Net operating loss carry forwards
    
    
    12,732,504
    
    
    
    37,484,836Income tax credit carry forwards
    
    
    202,215
    
    
    
    2,478,625Property and equipment
    
    
    6,820
    
    
    
    12,094Intangibles
    
    
    2,246,349
    
    
    
    2,360,396Other
    
    
    6,108
    
    
    
    6,553Total deferred tax assets
    
    
    16,380,475
    
    
    
    43,436,559Less: valuation allowance
    
    
    (16,380,475
    )
    
    
    (43,436,559
    )Total deferred tax assets, net of valuation allowance
    
    $
    
    
    
    $
    
 We have established a full valuation allowance against our net deferred tax assets due to
the uncertainty surrounding the realization of such assets. Management has determined it is
more likely than not that the deferred tax assets are not realizable due to our historical
loss position.
 The deferred tax asset for net operating losses and the related valuation allowance includes
approximately $47,000 related to stock option deductions, the benefit of which may
eventually be credited to equity. We recognize windfall tax benefits associated with the
exercise of stock options directly to stockholders equity only when realized. Accordingly,
as we are in a cumulative loss position, deferred tax assets have not been recognized for
net operating loss carry forwards resulting from windfall tax benefits generated through
stock option deductions.
 At December 31, 2010, we had federal and California tax loss carry forwards of approximately
$31.5 million and $34.4 million, respectively. The federal and California net operating loss
carry forwards begin to expire in 2016 and 2013, respectively, if unused. At December 31,
2010, we had federal and California R&D tax credit carry forwards of approximately $145,000
and $87,000, respectively. The federal R&D tax credits will begin to expire in 2029. The
California R&D tax credits do not expire.
 Pursuant to the Internal Revenue Code of 1986, as amended, (IRC) §382 and IRC §383, our
ability to use net operating loss and R&D tax credit carry forwards to offset future taxable
income is limited if we experience a cumulative change in ownership of more than 50% within
a three-year period. During 2010, we completed a formal study for the period January 1,
2008 through January 7, 2010. This study and a previous study identified several ownership
changes within the meaning of IRC §382. Upon application of limitations prescribed by IRC
§382, we identified certain tax attributes that would expire before utilization and have
adjusted our deferred tax assets for net operating loss and R&D tax credit carry forwards
accordingly. We will need to update the IRC §382 analysis since January 7, 2010 for the
subsequent registered direct equity financing completed during the year ended December 31,
2010. If an ownership change occurred after January 7, 2010, including as a result of the
equity financings we completed in May 2010 and January 2011, the amount of net operating loss
and R&D tax credit carry forwards available for utilization would be subject to further
limitation.
 In accordance with authoritative guidance, the impact of an uncertain income tax position on
the income tax return must be recognized at the largest amount that is more-likely-than-not
to be sustained upon audit by the relevant taxing authority. An uncertain income tax
position will not be recognized if it has less than a 50% likelihood of being sustained. As
of December 31, 2010, we continue to have no unrecognized tax benefits. There are no
unrecognized tax benefits included on the balance sheet that would, if recognized, impact
the effective tax rate. We do not anticipate there will be a significant change in
unrecognized tax benefits within the next 12 months.
 Our policy is to recognize interest and/or penalties related to income tax matters in income
tax expense. Because we have generated net operating losses since inception, no tax
liability, penalties or interest has
been recognized for balance sheet or income statement purposes as of and for the years ended
December 31, 2010 and 2009.
  F-28




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries   Notes to Consolidated Financial Statements
 We are subject to taxation in the U.S. and the state of California. All of our tax years are
subject to examination by the tax authorities due to the carry forward of unutilized net
operating losses and R&D tax credits.
 (12)
    
    Litigation
 In the normal course of business, we may become subject to lawsuits and other claims and
proceedings. Such matters are subject to uncertainty and outcomes are often not predictable
with assurance. We are not currently a party to any material pending litigation or other
material legal proceeding.
 (13)
    
    401(k)Plan
 We have a defined contribution savings plan pursuant to Section 401(k) of the IRC. The plan
is for the benefit of all qualifying employees and permits voluntary contributions by
employees up to 100% of eligible compensation, subject to the Internal Revenue Service
(IRS)-imposed maximum limits. From January 1, 2008 until May 16, 2009, the terms of the
plan required us to make matching contributions equal to 100% of employee contributions up
to 6% of eligible compensation, limited by the IRS-imposed maximum. In April 2009, we
amended the plan such that we were not required to make matching contributions on any
employee contributions made by a highly-compensated employee from May 16, 2009 through
December 31, 2009. In November 2009, we amended the plan to reinstate the 6% matching
contribution effective for the plan year beginning January 1, 2010. We incurred total
expenses of $47,250 and $29,661 in employer matching contributions in 2010 and 2009,
respectively.
 (14)
    
    Segment Information
 We operate our business on the basis of a single reportable segment, which, fundamentally,
is the business of acquiring, developing and commercializing proprietary product candidates.
We evaluate our Company as a single operating segment. The majority of our operating
activities and work performed by our employees are currently conducted from a single
location in the U.S. We recognized revenues of $0.5 million and $0.3 million in 2010 and
2009, respectively, which revenues were derived from U.S. government grants in 2010 and
license fees under a license agreement with Shin Poong Pharmaceutical Co., Ltd. in 2009.
 (15)
    
    Summary of Quarterly Financial Data (unaudited)
 The following is a summary of the unaudited quarterly results of operations for the years
ended December 31, 2010 and 2009:
 Quarterly statements of operations data
 Quarters Endedfor 2010 (unaudited):
    
    March 31
    
    
    June 30
    
    
    September 30
    
    
    December 31Grant revenue
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    488,959Gross margin
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    488,959Loss from operations
    
    
    (2,419,885
    )
    
    
    (1,942,750
    )
    
    
    (1,868,138
    )
    
    
    (2,308,924
    )Net loss
    
    
    (2,403,074
    )
    
    
    (1,919,442
    )
    
    
    (1,843,899
    )
    
    
    (2,284,507
    )Net loss applicable to common stock
    
    
    (4,917,994
    )
    
    
    (5,044,318
    )
    
    
    (1,843,899
    )
    
    
    (2,284,507
    )Basic and diluted net loss per share
    
    $
    (0.48
    )
    
    $
    (0.39
    )
    
    $
    (0.13
    )
    
    $
    (0.15
    )Basic and diluted weighted average
number of shares of common stock
outstanding
    
    
    10,143,789
    
    
    
    12,886,826
    
    
    
    14,701,216
    
    
    
    14,921,292
  F-29




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries   Notes to Consolidated Financial Statements
 Quarters Endedfor 2009 (unaudited):
    
    March 31
    
    
    June 30
    
    
    September 30
    
    
    December 31Licensing revenue
    
    $
    300,000
    
    
    $
    
    
    
    $
    
    
    
    $
    Gross margin
    
    
    300,000
    
    
    
    
    
    
    
    
    
    
    
    Loss from operations
    
    
    (3,158,786
    )
    
    
    (2,552,485
    )
    
    
    (2,349,865
    )
    
    
    (3,224,549
    )Net loss
    
    
    (3,157,010
    )
    
    
    (2,595,541
    )
    
    
    (2,352,586
    )
    
    
    (3,219,921
    )Net loss applicable to common stock
    
    
    (3,157,010
    )
    
    
    (3,827,956
    )
    
    
    (2,728,675
    )
    
    
    (6,478,304
    )Basic and diluted net loss per share
    
    $
    (0.87
    )
    
    $
    (1.02
    )
    
    $
    (0.57
    )
    
    $
    (1.00
    )Basic and diluted weighted average
number of shares of common stock
outstanding
    
    
    3,610,102
    
    
    
    3,735,572
    
    
    
    4,779,228
    
    
    
    6,509,266
 (16)
    
    Severance Related Expenses
 As part of restructuring to reduce operating costs, we completed workforce reductions of
nine employees in the three months ended December 31, 2008 and fifteen employees in the six
months ended June 30, 2009. As a result, we recorded severance-related charges of $350,000
in the first quarter of 2009, of which $237,000 was recorded in research and development and
the balance was recorded in selling, general and administrative, and $163,000 in the second
quarter of 2009, of which $121,000 was recorded in research and development and the balance
was recorded in selling, general and administrative. As of June 30, 2009, all
severance-related costs associated with these workforce reductions had been recorded and
paid. No severance-related costs were recorded or paid during the year ended December 31,
2010.
 (17)
    
    Subsequent Events
 On January 11, 2011, we completed a registered direct equity financing involving the
issuance of units consisting of 8,184,556 shares of our common stock, 5-year warrants to
purchase up to an aggregate of 2,046,139 shares of our common stock and 1-year warrants to
purchase up to an aggregate of 2,046,139 shares of our common stock. The gross proceeds of
this financing were $22.5 million, and we received $21.0 million in net proceeds after
deducting the fees and expenses of our placement agent and our other offering expenses. We
may receive up to $11.3 million of additional proceeds from the exercise of the warrants
issued in this financing. Those warrants have an exercise price of $2.75 per share. The
5-year warrants are exercisable any time on or before January 11, 2016 and the 1-year
warrants are exercisable any time on or before January 19, 2012, subject to certain
beneficial ownership limitations.
 In November 2010, we submitted a new drug application (NDA), for Exelbine to the U.S. Food
and Drug Administration (FDA), and in January 2011, we announced that the FDA accepted the
Exelbine NDA for filing and established a Prescription Drug User Fee Act, or PDUFA, goal
date of September 1, 2011 to finish its review of the Exelbine NDA.
  F-30




---



##### Table of Contents



ADVENTRX Pharmaceuticals, Inc. and Subsidiaries   Notes to Consolidated Financial Statements
 In February 2011, we entered into an agreement and plan of merger to acquire SynthRx, Inc.
(SynthRx), a privately-held Delaware corporation developing a purified form of a rheologic
and antithrombotic agent, poloxamer 188 (188), in exchange for shares of our common stock.
As discussed in more detail under Part I, Item 1 Business in this report, we initially
intend to develop purified 188 for the treatment of sickle cell crisis in a pediatric
population and, if our acquisition of SynthRx closes and we are able to reach agreement with
the FDA on a study protocol on a timely basis, we may initiate a phase 3 clinical trial of
purified 188 for that indication in 2012. In connection with the consummation of this
acquisition, we would issue 2,938,773 shares of our common stock to SynthRxs stakeholders,
1,938,773 of which would be subject to repurchase by us in the event development of purified
188 does not achieve the first milestone described below. We could issue up to an aggregate
of 13,478,050 additional shares of our common stock to SynthRxs stakeholders if the
development of purified 188 achieves certain milestones, as described below, and our
stockholders approve the issuance of such milestone-related shares, as required by NYSE Amex
rules. If our stockholders do not approve the issuance of the milestone-related shares,
under the terms of the merger agreement, we would be required to pay SynthRxs stakeholders
in cash the value of
the milestone-related shares we would have otherwise issued, with all such cash payments
made in quarterly installments and, with respect to the cash value associated with
12,478,050 of the milestone-related shares, payable based on net sales of purified 188. Of
the shares issuable in connection with achievement of milestones, up to 1,000,000 shares
would be issuable upon the dosing of the first patient in a phase 3 clinical study that the
FDA has indicated may be sufficient to support approval of a new drug application covering
the use of purified 188 for the treatment of sickle cell crisis in children (the 188 NDA),
which we refer to as the first milestone; 3,839,400 shares would be issuable upon acceptance
for review of the 188 NDA by the FDA, which we refer to as the second milestone; and
8,638,650 shares would be issuable upon approval by the FDA of the 188 NDA, which we refer
to as the third milestone.
  F-31




---



##### Table of Contents



Exhibit Index
 Exhibit
    
    Description2.1
    (1)
    
    Agreement and Plan of Merger, dated April 7, 2006, among the registrant, Speed
Acquisition, Inc., SD Pharmaceuticals, Inc. and certain individuals named
therein (including exhibits thereto)3.1
    (2)
    
    Amended and Restated Certificate of Incorporation of the registrant3.2
    (3)
    
    Certificate of Amendment to the Amended and Restated Certificate of
Incorporation of the registrant dated October 5, 20093.3
    (4)
    
    Certificate of Amendment to the Amended and Restated Certificate of
Incorporation of the registrant, dated April 23, 20103.4
    (5)
    
    Certificate of Designation of Preferences, Rights and Limitations of 0% Series A
Convertible Preferred Stock3.5
    (6)
    
    Certificate of Designation of Preferences, Rights and Limitations of 5% Series B
Convertible Preferred Stock3.6
    (7)
    
    Certificate of Designation of Preferences, Rights and Limitations of 5% Series C
Convertible Preferred Stock3.7
    (8)
    
    Certificate of Designation of Preferences, Rights and Limitations of 4.25660%
Series D Convertible Preferred Stock3.8
    (9)
    
    Certificate of Designation of Preferences, Rights and Limitations of
3.73344597664961% Series E Convertible Preferred Stock3.9
    (10)
    
    Certificate of Designation of Preferences, Rights and Limitations of
2.19446320054018% Series F Convertible Preferred Stock3.10
    (11)
    
    Amended and Restated Bylaws of the registrant (formerly known as Biokeys
Pharmaceuticals, Inc.)10.1
    (12)
    
    Securities Purchase Agreement, dated July 21, 2005, among the registrant and the
Purchasers (as defined therein)10.2
    (12)
    
    Rights Agreement, dated July 27, 2005, among the registrant, the Icahn
Purchasers and Viking (each as defined therein)10.3
    (13)
    
    First Amendment to Rights Agreement, dated September 22, 2006, among the
registrant and the Icahn Purchasers (as defined therein)10.4
    (14)
    
    Second Amendment to Rights Agreement, dated February 25, 2008, among the
registrant and the Icahn Purchasers (as defined therein)10.5
    (15)
    
    Third Amendment to Rights Agreement, dated August 26, 2009, among the registrant
and Icahn Purchasers (as defined therein)10.6
    (12)
    
    Form of $2.26 Common Stock Warrant issued on July 27, 2005 to Icahn Partners LP,
Icahn Partners Master Fund LP, High River Limited Partnership, Viking Global
Equities LP and VGE III Portfolio Ltd.10.7
    (12)
    
    Form of $2.26 Common Stock Warrant issued on July 27, 2005 to North Sound Legacy
Institutional Fund LLC and North Sound Legacy International Ltd.10.8
    (5)
    
    Engagement Letter Agreement, dated June 7, 2009, by and between the registrant
and Rodman & Renshaw, LLC10.9
    (5)
    
    Securities Purchase Agreement, date June 8, 2009, governing the issuance and
sale of the registrants 0% Series A Convertible Preferred Stock and 5-year
common stock purchase warrants




---



##### Table of Contents



Exhibit
    
    Description10.10
    (5)
    
    Form of Common Stock Purchase Warrant issued on June 12, 2009 by the registrant
to the purchasers of the registrants 0% Series A Convertible Preferred Stock
and to Rodman & Renshaw, LLC10.11
    (6)
    
    Engagement Letter Agreement, dated June 26, 2009, by and between the registrant
and Rodman & Renshaw, LLC10.12
    (6)
    
    Securities Purchase Agreement, dated June 29, 2009, governing the issuance and
sale of the registrants 5% Series B Convertible Preferred Stock10.13
    (6)
    
    Form of Common Stock Purchase Warrant issued on July 6, 2009 by the registrant
to Rodman & Renshaw, LLC10.14
    (7)
    
    Engagement Letter Agreement, dated August 4, 2009, by and between the registrant
and Rodman & Renshaw, LLC10.15
    (7)
    
    Securities Purchase Agreement, dated August 5, 2009, governing the issuance and
sale of the registrants 5% Series C Convertible Preferred Stock10.16
    (7)
    
    Form of Common Stock Purchase Warrant issued on August 10, 2009 by the
registrant to Rodman & Renshaw, LLC10.17
    (16)
    
    Engagement Letter Agreement, dated September 24, 2009, by and between the
registrant and Rodman & Renshaw, LLC10.18
    (8)
    
    Engagement Letter Agreement, dated September 29, 2009, by and between the
registrant and Rodman & Renshaw, LLC10.19
    (8)
    
    Form of Securities Purchase Agreement, dated October 6, 2009, governing the
issuance and sale of the registrants 4.25660% Series D Convertible Preferred
Stock and 5-year common stock purchase warrants10.20
    (8)
    
    Form of Common Stock Purchase Warrant issued on October 9, 2009 by the
registrant to the purchasers of the registrants 4.25660% Series D Convertible
Preferred Stock and to Rodman & Renshaw, LLC10.21
    (9)
    
    Engagement Letter Agreement, dated January 3, 2010, by and between the
registrant and Rodman & Renshaw, LLC10.22
    (9)
    
    Securities Purchase Agreement, dated as of January 4, 2010, governing the
issuance and sale of the registrants 3.73344597664961% Series E Convertible
Preferred Stock and 30-month common stock purchase warrants10.23
    (9)
    
    Form of Common Stock Purchase Warrant issued on January 7, 2010 by the
registrant to the purchasers of the registrants 3.73344597664961% Series E
Convertible Preferred Stock and to Rodman & Renshaw, LLC10.24
    (10)
    
    Engagement Letter Agreement, dated April 29, 2010, by and between the registrant
and Rodman & Renshaw, LLC10.25
    (10)
    
    Form of Securities Purchase Agreement, dated May 2, 2010 governing the issuance
and sale of the registrants 2.19446320054018% Series F Convertible Preferred
Stock and 5-year and 1-year common stock purchase warrants10.26
    (10)
    
    Form of Series A and B Common Stock Purchase Warrants issued on May 6, 2010 by
the registrant to the purchasers of the registrants 2.19446320054018% Series F
Convertible Preferred Stock10.27
    (17)
    
    Engagement Letter Agreement, dated January 5, 2011, by and between the
registrant and Rodman & Renshaw, LLC




---



##### Table of Contents



Exhibit
    
    Description10.28
    (17)
    
    Form of Securities Purchase Agreement, dated January 6, 2011 governing the
issuance and sale of the registrants common stock and 5-year and 1-year common
stock purchase warrants10.29
    (17)
    
    Form of [Series A/B] Common Stock Purchase Warrant issued on January 11, 2011 by
the registrant to the purchasers of the registrants common stock and to Rodman
& Renshaw, LLC10.30
    #(18)
    
    2005 Equity Incentive Plan10.31
    #(19)
    
    Form of Stock Option Agreement under the 2005 Equity Incentive Plan10.32
    #(20)
    
    Form of Stock Option Agreement under the 2005 Equity Incentive Plan (for
director option grants beginning in 2008)10.33
    #(21)
    
    Form of Stock Option Agreement under the 2005 Equity Incentive Plan (for option
grants to employees approved in March 2008)10.34
    #(2)
    
    Form of Restricted Share Award Agreement under the 2005 Equity Incentive Plan10.35
    #(22)
    
    2008 Omnibus Incentive Plan10.36
    #(23)
    
    Form of Notice of Grant of Restricted Stock Units under the 2008 Omnibus
Incentive Plan (for grants to employees in January 2009)10.37
    #(23)
    
    Form of Restricted Stock Units Agreement under the 2008 Omnibus Incentive Plan10.38
    #(24)
    
    Form of Non-Statutory Stock Option Grant Agreement (for directors) under the
2008 Omnibus Incentive Plan10.39
    #(24)
    
    Form of Non-Statutory/Incentive Stock Option Grant Agreement (for
consultants/employees) under the 2008 Omnibus Incentive Plan10.40
    #(25)
    
    Form of Incentive Stock Option Grant Agreement under the 2008 Omnibus Incentive
Plan (for grant to Brian M. Culley in July 2009)10.41
    #(25)
    
    Form of Incentive Stock Option Grant Agreement under the 2008 Omnibus Incentive
Plan (for grant to Patrick L. Keran in July 2009)10.42
    #(26)
    
    Form of letter, dated January 20, 2010, modifying options granted to Brian M.
Culley and Patrick L. Keran in July 200910.43
    #(26)
    
    Form of Incentive Stock Option Grant Agreement under the 2008 Omnibus Incentive
Plan (for grant to Brian M. Culley in January 2010)10.44
    #(26)
    
    Form of Incentive Stock Option Grant Agreement under the 2008 Omnibus Incentive
Plan (for grant to Patrick L. Keran in January 2010)10.45
    (20)
    
    License Agreement, dated December 10, 2005, among SD Pharmaceuticals, Latitude
Pharmaceuticals and Andrew Chen, including a certain letter, dated November 20,
2007, clarifying the scope of rights thereunder10.46
    (27)
    
    License Agreement, dated March 25, 2009, among the registrant, SD
Pharmaceuticals, Inc. and Shin Poong Pharmaceutical Co., Ltd.10.47
    (28)
    
    Standard Multi-Tenant Office Lease  Gross, dated June 3, 2004, between the
registrant and George V. Casey & Ellen M. Casey, Trustees of the Casey Family
Trust dated June 22, 199810.48
    (2)
    
    First Amendment to the Standard Multi-Tenant Office Lease  Gross, dated June
3, 2004 between the registrant and George V. & Ellen M. Casey, Trustees of the
Casey Family Trust dated June 22, 199810.49
    (29)
    
    Second Amendment to Standard Mutli-Tenant Office Lease  Gross, dated July 22,
2009, by and among Westcore Mesa View, LLC, DD Mesa View LLC and the registrant




---



##### Table of Contents



Exhibit
    
    Description10.50
    (30)
    
    Third Amendment to Standard Multi-Tenant Office Lease  Gross, dated December
10, 2009, by and among Westcore Mesa View, LLC, DD Mesa View, LLC and the
registrant10.51
    (31)
    
    Fourth Amendment to Standard Multi-Tenant Office Lease  Gross, dated February
4, 2010, by and among Westcore Mesa View, LLC, DD Mesa View, LLC and the
registrant10.52
    #(32)
    
    Offer letter, dated November 15, 2004, to Brian M. Culley10.53
    #(23)
    
    Retention and Incentive Agreement, dated January 28, 2009 between the registrant
and Brian M. Culley10.54
    #(27)
    
    Retention and Incentive Agreement, dated January 28, 2009, between the
registrant and Patrick L. Keran10.55
    #(31)
    
    Consulting Agreement, effective as of July 15, 2009, and Amendment to Consulting
Agreement, effective as of December 31, 2009, between the registrant and Michele
L. Yelmene10.56
    #(25)
    
    2009 Mid-Year Incentive Plan for Brian M. Culley and Patrick L. Keran10.57
    #(25)
    
    Retention and Severance Plan (as of July 21, 2009) for Brian M. Culley and
Patrick L. Keran10.58
    #(26)
    
    2010 Incentive Plan for Brian M. Culley and Patrick L. Keran10.59
    #(31)
    
    Consulting Agreement, effective as of November 23, 2009, between the registrant
and Eric K. Rowinsky10.60
    #(33)
    
    Director Compensation Policy, adopted June 21, 200610.61
    #(31)
    
    Director Compensation Policy, adopted January 25, 201010.62
    (34)
    
    Form of Director and Officer Indemnification Agreement21.1
    
    
    List of Subsidiaries23.1
    
    
    Consent of J.H. Cohn LLP, Independent Registered Public Accounting Firm31.1
    
    
    Certification of principal executive officer pursuant to Rule 13a-14(a)/15d-14(a)31.2
    
    
    Certification of principal financial officer pursuant to Rule 13a-14(a)/15d-14(a)32.1
    ±
    
    Certification of principal executive officer and principal financial officer
pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
 
 
    
    Indicates that confidential treatment has been requested or granted to
certain portions, which portions have been omitted and filed
separately with the SEC#
    
    Indicates management contract or compensatory plan±
    
    These certifications are being furnished solely to accompany this
report pursuant to 18 U.S.C. 1350, and are not being filed for
purposes of Section 18 of the Securities Exchange Act of 1934 and are
not to be incorporated by reference into any filing of the registrant,
whether made before or after the date hereof, regardless of any
general incorporation by reference language in such filing.(1)
    
    Filed with the registrants Amendment No. 1 to Current Report on Form 8-K/A on May 1, 2006
(SEC file number 001-32157-06796248)(2)
    
    Filed with the registrants Annual Report on Form 10-K on March 16, 2006 (SEC file number
001-32157-06693266)(3)
    
    Filed with the registrants Current Report on Form 8-K on October 13, 2009 (SEC file number
001-32157-091115090)




---



##### Table of Contents



(4)
    
    Filed with the registrants Current Report on Form 8-K on April 26, 2010 (SEC file number
001-32157-10769058)(5)
    
    Filed with the registrants Current Report on Form 8-K on June 8, 2009 (SEC file number
001-32157-09878961)(6)
    
    Filed with the registrants Current Report on Form 8-K on June 30, 2009 (SEC file number
001-32157-09917820)(7)
    
    Filed with the registrants Current Report on Form 8-K on August 5, 2009 (SEC file number
001-32157-09989205)(8)
    
    Filed with the registrants Amendment No. 3 to the Registration Statement on Form S-1 on
October 5, 2009 (SEC file number 333-160778-091107945)(9)
    
    Filed with the registrants Current Report on Form 8-K on January 4, 2010 (SEC file number
001-32157- 10500379)(10)
    
    Filed with the registrants Current Report on Form 8-K on May 3, 2010 (SEC file number
001-32157-10790486)(11)
    
    Filed with the registrants Current Report on Form 8-K on December 15, 2008 (SEC file number
001-32157-081249921)(12)
    
    Filed with the registrants Quarterly Report on Form 10-Q on August 12, 2005 (SEC file number
001-32157-051022046)(13)
    
    Filed with the registrants Current Report on Form 8-K on September 22, 2006 (SEC file number
001-32157-061103268)(14)
    
    Filed with the registrants Current Report on Form 8-K on February 25, 2008 (SEC file number
001-32157 08638638)(15)
    
    Filed with the registrants Current Report on Form 8-K on September 1, 2009 (SEC file number
001-32157-091049161)(16)
    
    Filed with the registrants Amendment No. 2 to the Registration Statement on Form S-1 on
September 25, 2009 (SEC file number 333-160778-091087750)(17)
    
    Filed with the registrants Current Report on Form 8-K on January 7, 2011 (SEC file number
001-32157-11515655)(18)
    
    Filed with the registrants Annual Report on Form 10-K on March 15, 2007 (SEC file number
001-32157-07697283)(19)
    
    Filed with the registrants Registration Statement on Form S-8 on July 13, 2005 (SEC file
number 333-126551-05951362)(20)
    
    Filed with registrants Annual Report on Form 10-K on March 17, 2008 (SEC file number
001-32157-08690952)(21)
    
    Filed with the registrants Quarterly Report on Form 10-Q on May 12, 2008 (SEC file number
001-32157-08820541)(22)
    
    Filed with the registrants Current Report on Form 8-K on June 2, 2008 (SEC file number
001-32157-08874724)(23)
    
    Filed with the registrants Current Report on Form 8-K on February 2, 2009 (SEC file number
001-32157- 09561715)(24)
    
    Filed with the registrants Quarterly Report on Form 10-Q on August 11, 2008 (SEC file number
001-32157-081005744)(25)
    
    Filed with the registrants Current Report on Form 8-K on July 22, 2009 (SEC file number
001-32157-09957353)(26)
    
    Filed with the registrants Current Report on Form 8-K on January 26, 2010 (SEC file number
001-32157- 10547818)




---



##### Table of Contents



(27)
    
    Filed with the registrants Quarterly Report on Form 10-Q on May 15, 2009 (SEC file number
001-32157-09878961)(28)
    
    Filed with the registrants Quarterly Report on Form 10-QSB on August 10, 2004 (SEC file
number 001-32157-04963741)(29)
    
    Filed with the registrants Current Report on Form 8-K on August 20, 2009 (SEC file number
001-32157-091025631)(30)
    
    Filed with the registrants Current Report on Form 8-K on December 24, 2009 (SEC file number
001-32157-091260100)(31)
    
    Filed with the registrants Annual Report on Form 10-K on March 18, 2010 (SEC file number
001-32157-10692317)(32)
    
    Filed with the registrants Annual Report on Form 10-KSB on March 31, 2005 (SEC file number
001-32157-05719975)(33)
    
    Filed with the registrants Current Report on Form 8-K on June 23, 2006 (SEC file number
001-32157-06922676)(34)
    
    Filed with the registrants Current Report on Form 8-K on October 23, 2006 (SEC file number
001-32157-061156993)