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Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2013	Nov. 13, 2013
Document and Entity Information
Entity Registrant Name	PTC THERAPEUTICS, INC.
Entity Central Index Key	0001070081
Document Type	10-Q
Document Period End Date	Sep. 30, 2013
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		24,917,089
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q3

Balance sheets - USD ($)	Sep. 30, 2013	Dec. 31, 2012
Current assets:
Cash and cash equivalents	$ 24,044,819	$ 2,725,702
Marketable securities	133,182,565
Prepaid expenses and other current assets	2,126,575	855,750
Grant and collaboration receivables, net	783,851	1,013,813
Total current assets	160,137,810	4,595,265
Fixed assets, net	6,942,956	8,280,037
Deposits and other assets	163,349	197,050
Total assets	167,244,115	13,072,352
Current liabilities:
Accounts payable and accrued expenses	10,205,493	7,023,971
Current portion of long-term debt	84,234	4,444,171
Deferred revenue	3,631,430	16,690,747
Total current liabilities	13,921,157	28,158,889
Deferred revenue, less current portion		741,667
Long-term debt, less current portion		438,810
Other long-term liabilities	2,290,445	2,549,719
Total liabilities	16,211,602	31,889,085
Stockholders' (deficit) equity:
Common stock, $0.001 par value. Authorized 17,000,000 shares; issued and outstanding 4,526 shares at December 31, 2012. Authorized 125,000,000 shares; issued and outstanding 23,803,282 shares at September 30, 2013	24,344	545
Additional paid-in capital	461,960,966	177,583,672
Accumulated other comprehensive loss	(40,467)
Accumulated deficit	(310,912,330)	(277,224,718)
Total stockholders' (deficit) equity	151,032,513	(99,640,501)
Total liabilities, convertible preferred stocks and stockholders' (deficit) equity	167,244,115	13,072,352
Series One convertible preferred stock
Stockholders' (deficit) equity:
Preferred stock		62,263,852
Series Two convertible preferred stock
Stockholders' (deficit) equity:
Preferred stock		18,182,129
Series Three convertible preferred stock
Stockholders' (deficit) equity:
Preferred stock		377,787
Preferred stock
Stockholders' (deficit) equity:
Preferred stock

Balance sheets (Parenthetical) - $ / shares	Sep. 30, 2013	Dec. 31, 2012
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, Authorized shares	125,000,000	17,000,000
Common stock, issued shares	23,803,282	4,526
Common stock, outstanding shares	23,803,282	4,526
Series One convertible preferred stock
Preferred stock, designated shares		2,000,000
Preferred stock, issued shares		1,483,337
Preferred stock, outstanding shares		1,483,337
Series Two convertible preferred stock
Preferred stock, designated shares		13,750,000
Preferred stock, issued shares		10,701,405
Preferred stock, outstanding shares		10,701,405
Series Three convertible preferred stock
Preferred stock, designated shares		13,750,000
Preferred stock, issued shares		2,853,517
Preferred stock, outstanding shares		2,853,517
Preferred stock
Preferred stock, par value (in dollars per share)	$ 0.001
Preferred stock, undesignated shares	5,000,000
Preferred stock, issued shares	0
Preferred stock, outstanding shares	0

Statements of operations - USD ($)	3 Months Ended		9 Months Ended
Statements of operations - USD ($)	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Revenues:
Collaboration revenue	$ 15,455,361	$ 6,042,746	$ 27,395,315	$ 22,860,543
Grant revenue	834,212	1,152,330	2,890,134	4,445,430
Total revenues and non-cash cancellation revenue	16,289,573	7,195,076	30,285,449	27,305,973
Operating expenses:
Research and development	13,886,196	10,466,454	39,855,115	36,688,786
General and administrative	6,678,992	3,783,929	17,735,294	11,390,938
Total operating expenses	20,565,188	14,250,383	57,590,409	48,079,724
Loss from operations	(4,275,615)	(7,055,307)	(27,304,960)	(20,773,751)
Interest (expense) income, net	26,695	(247,325)	(6,249,534)	(1,007,586)
Loss on extinguishment of debt	(129,963)		(129,963)
Other income (expense), net	(37,616)	5,507	(3,155)	1,818,279
Net loss	(4,416,499)	(7,297,125)	(33,687,612)	(19,963,058)
Deemed dividend			(18,248,768)
Gain on exchange of convertible preferred stock in connection with recapitalization			3,390,750	159,954,069
Less beneficial conversion charge				(377,787)
Net (loss) income attributable to common stockholders	$ (4,416,499)	$ (7,297,125)	$ (48,545,630)	$ 139,613,224
Weighted-average shares outstanding:
Basic (in shares)	23,803,282	4,545	8,995,167	2,937
Weighted-average shares outstanding:
Diluted (in shares)	23,803,282	4,545	8,995,167	13,593
Net (loss) income per share applicable to common stockholders-basic (in dollars per share)	$ (0.19)	$ (1,605.53)	$ (5.40)	$ 182.41
Net (loss) income per share applicable to common stockholders-diluted (in dollars per share)	$ (0.19)	$ (1,605.53)	$ (5.40)	$ 39.41

Statements of cash flows - USD ($)	9 Months Ended
Statements of cash flows - USD ($)	Sep. 30, 2013	Sep. 30, 2012
Cash flows from operating activities
Net loss	$ (33,687,612)	$ (19,963,058)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation	1,810,850	2,048,682
Change in valuation of warrant liability	3,158	(1,818,279)
Non-cash interest expense	6,048,580	204,422
Loss on extinguishment of debt	129,963
Share-based compensation expense	5,142,187	1,815,722
Changes in operating assets and liabilities:
Prepaid expenses and other current assets	(1,287,875)	2,250,089
Grant and collaboration receivables	229,962	75,698
Deposits and other assets	33,699	24,399
Accounts payable and accrued expenses	3,181,522	(4,748,005)
Other long-term liabilities	(262,432)	(68,432)
Deferred revenue	(13,800,984)	(16,711,980)
Net cash used in operating activities	(32,458,982)	(36,890,742)
Cash flows from investing activities
Purchases of fixed assets	(473,769)	(183,511)
Purchases of marketable securities	(139,730,579)
Maturities of marketable securities	6,507,547
Net cash used in investing activities	(133,696,801)	(183,511)
Cash flows from financing activities
Payments on long-term debt	(4,960,151)	(6,240,116)
Net proceeds from sale of Series One convertible preferred stock		29,354,752
Net proceeds from sale of Series Four convertible preferred stock	60,785,363
Net proceeds from initial public offering	131,649,688
Net cash provided by financing activities	187,474,900	23,114,636
Net (decrease) increase in cash and cash equivalents	21,319,117	(13,959,617)
Cash and cash equivalents, beginning of period	2,725,702	28,431,410
Cash and cash equivalents, end of period	24,044,819	14,471,793
Supplemental disclosure of cash information
Cash paid for interest	365,589	1,009,478
Supplemental disclosures of non-cash information related to investing and financing activities
Change in unrealized loss on marketable securities	(40,467)
Change in carry value of preferred securities resulting from recapitalization	$ 3,390,750	$ 159,576,282

Summary of significant accounting policies	9 Months Ended
Summary of significant accounting policies	Sep. 30, 2013
Summary of significant accounting policies
Summary of significant accounting policies	2. Summary of significant accounting policies The Company’s complete listing of significant accounting policies are described in note 2 of the notes to the Company’s audited financial statements as of December 31, 2012 included in the final prospectus dated June 19, 2013 related to the Company’s initial public offering. Basis of Presentation The accompanying financial information as of September 30, 2013 and for the three and nine months ended September 30, 2012 and 2013 has been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (GAAP) have been condensed or omitted pursuant to such rules and regulations. These interim financial statements should be read in conjunction with the Company’s audited financial statements as of December 31, 2012 and notes thereto included in the final prospectus related to the Company’s initial public offering. In the opinion of management, the unaudited financial information as of September 30, 2013 and for three and nine months ended September 30, 2012 and 2013 reflects all adjustments, which are normal recurring adjustments, necessary to present a fair statement of financial position, results of operations and cash flows. The results of operations for the three and nine month periods ended September 30, 2013 are not necessarily indicative of the results to be expected for the year ended December 31, 2013 or for any other interim period or for any other future year. Use of estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Reverse stock split On March 7, 2013, the Company effected a one-for-120 reverse stock split of its common stock, pursuant to which each 120 shares of the Company’s outstanding common stock were reclassified and combined into one share of common stock. All common stock share and per share references in the financial statements and notes thereto have been restated to reflect the reverse stock split on a retroactive basis. Marketable Securities Management determines the classification of marketable securities at the time of purchase and reevaluates such designation as of each balance sheet date. Marketable securities are classified as available-for-sale and carried at fair value, with any unrealized gain or loss recorded as a separate component of stockholders’ (deficit) equity. Revenue recognition The Company recognizes revenue when amounts are realized or realizable and earned. Revenue is considered realizable and earned when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been rendered; (3) the price is fixed or determinable; and (4) collection of the amounts due are reasonably assured. The Company’s revenue is generated primarily through collaborative research and development and licensing agreements and grants. The terms of these agreements typically include payments to the Company of one or more of the following: nonrefundable, upfront license fees; milestone payments; research funding and royalties on future product sales. In addition, the Company generates service revenue through agreements that generally provide for fees for research and development services and may include additional payments upon achievement of specified events. For existing collaborations entered into prior to the adoption in 2011 of the revised multiple element revenue recognition guidance described below, the Company recognized revenue consistent with the approach established at the inception of each arrangement. For these existing collaborations, where the Company has continuing involvement, the Company recorded nonrefundable, upfront fees as deferred revenue and recognizes revenue on a straight-line basis as collaboration revenue over the expected performance period. For new collaborations or for material modifications made to existing collaborations, in 2011 and thereafter, the Company adopted the updated multiple element revenue recognition guidance. Under this guidance, all non-contingent arrangement consideration is allocated to the identified units of accounting based on their relative selling price at inception of the collaboration arrangement. The Company derives the selling price using a combination of internal subjective and available external objective information, such as comparable transactions. The Company recognizes revenue commensurate with delivery, such as in the case with delivery of a license, or ratably over the course of a service period, as appropriate, such as in the case of ongoing research and development activities. The Company evaluates all contingent consideration earned, such as a milestone payment, using the criteria as provided by the Financial Accounting Standards Board (FASB) guidance on the milestone method of revenue recognition. At the inception of a collaboration arrangement, the Company evaluates if milestone payments are substantive. The criteria requires that (1) the Company determines if the milestone is commensurate with either its performance to achieve the milestone or the enhancement of value resulting from its activities to achieve the milestone; (2) the milestone be related to past performance; and (3) the milestone be reasonable relative to all deliverable and payment terms of the collaboration arrangement. If these criteria are met then the contingent milestones can be considered as substantive milestones and will be recognized as revenue in the period that the milestone is achieved. The Company recognizes royalties as earned in accordance with the terms of various research and collaboration agreements. If not substantive, the contingent consideration is allocated to the existing units of accounting based on relative selling price and recognized following the same basis previously established for the associated unit of accounting. The Company recognizes revenue for reimbursements of research and development costs under collaboration agreements as the services are performed. The Company records these reimbursements as revenue and not as a reduction of research and development expenses as the Company has the risks and rewards as the principal in the research and development activities. Fair value of financial instruments The Company follows the fair value measurement rules, which provides guidance on the use of fair value in accounting and disclosure for assets and liabilities when such accounting and disclosure is called for by other accounting literature. These rules establish a fair value hierarchy for inputs to be used to measure fair value of financial assets and liabilities. This hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three levels: Level 1 (highest priority), Level 2, and Level 3 (lowest priority). · Level 1—Unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the balance sheet date. · Level 2—Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (i.e., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs). · Level 3—Inputs are unobservable and reflect the Company’s assumptions as to what market participants would use in pricing the asset or liability. The Company develops these inputs based on the best information available. Cash equivalents are reflected in the accompanying financial statements at fair value. The carrying amount of grant and collaboration receivables, accounts payable and accrued expenses, and debt approximates fair value due to the short-term nature of those instruments. Warrant liability Warrants to purchase the Company’s common stock with nonstandard antidilution provisions and preferred stock that include a put feature, regardless of the probability or likelihood that may conditionally obligate the issuer to ultimately transfer assets, are classified as liabilities and are recorded at their estimated fair value at each reporting period. Any change in fair value of these warrants is recorded as gain (loss) on warrant valuation each reporting period in Other income (expense), net on the Company’s statement of operations. Share-based compensation The Company measures the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. For service type awards, share-based compensation expense is recognized on a straight-line basis over the period during which the employee is required to provide service in exchange for the entire award. For awards that vest or begin vesting upon achievement of a performance condition, the Company estimates the likelihood of satisfaction of the performance condition and recognizes compensation expense when achievement of the performance condition is deemed probable using an accelerated attribution model. The fair value of options is calculated using the Black-Scholes option pricing model to determine the fair value of stock options on the date of grant based on key assumptions, such as expected volatility and expected term. As a new public company, the Company does not have sufficient history to estimate the volatility of its common stock price or the expected life of the options. The Company calculates expected volatility based on reported data for similar publicly traded companies for which historical information is available and will continue to do so until the historical volatility of its common stock is sufficient to measure expected volatility for future option grants.

Fair value of financial instruments and marketable securities

9 Months Ended

Sep. 30, 2013

Fair value of financial instruments and marketable securities

Fair value of financial instruments and marketable securities

3. Fair value of financial instruments and marketable securities

Fair value of certain marketable securities is based upon market prices using quoted prices in active markets for identical assets quoted on the last day of the period. In establishing the estimated fair value of the remaining investments, the Company used the fair value as determined by its investment advisors using observable inputs other than quoted prices.

The Company reviews its investments on a periodic basis for other-than-temporary impairments. This review is subjective, as it requires management to evaluate whether an event or change in circumstances has occurred in that period that may have a significant adverse effect on the fair value of the investment.

The following represents the fair value using the hierarchy described in Note 2 for the Company’s financial assets that are required to be measured at fair value on a recurring basis as of December 31, 2012 and September 30, 2013:

	December 31, 2012
	Total		Quoted prices in active markets for identical assets (level 1)		Significant other observable inputs (level 2)		Significant unobservable inputs (level 3)
Warrant liability	$	95,661	$	—	$	—	$	95,661

	September 30, 2013
	Total		Quoted prices in active markets for identical assets (level 1)		Significant other observable inputs (level 2)		Significant unobservable inputs (level 3)
Marketable securities	$	133,182,565	$	—	$	133,182,565	$	—
Warrant liability	98,819		—		—		98,819

The following is a summary of marketable securities accounted for as available-for-sale securities at September 30, 2013:

	September 30, 2013
	Amortized		Gross Unrealized					Fair
	Cost		Gains		Losses			Value
Commercial paper	$	24,978,703	$	20,527	$	—		$	24,999,230
U.S. corporate debt securities	108,244,329		19,642		(80,636		)	108,183,335
	$	133,223,032	$	40,169	$	(80,636	)	$	133,182,565

At September 30, 2013, the Company held securities with an unrealized loss position that were not considered to be other-than-temporarily impaired as the Company has the ability to hold such investments until recovery of their fair value.

Marketable securities on the balance sheet at September 30, 2013 mature as follows:

	September 30, 2013
	Less Than 12 Months		More Than 12 Months
Commercial paper	$	24,999,230	$	—
U.S. corporate debt securities	57,824,657		50,358,678
Total Marketable securities	$	82,823,887	$	50,358,678

There were no marketable securities as of December 31, 2012.

Level 3 valuation

The warrant liability is classified in Other long-term liabilities on the Company’s balance sheet. The warrant liability is marked-to-market each reporting period with the change in fair value recorded as a gain or loss within Other income (expense), net on the Company’s statement of operations until the warrants are exercised, expire or other facts and circumstances lead the warrant liability to be reclassified as an equity instrument. The fair value of the warrant liability is determined at each reporting period by utilizing the Black-Scholes option pricing model.

The table presented below is a summary of changes in the fair value of the Company’s Level 3 valuation for warrant liability for the period ended September 30, 2013:

	Level 3 assets
Beginning balance as of December 31, 2012	$	95,661
Warrants issued in connection with convertible promissory notes	6,000,000
Deemed dividend	18,248,768
Exercise of warrants issued in connection with convertible promissory notes	(24,248,765		)
Change in fair value of warrant liability	3,155
Ending balance as of September 30, 2013	$	98,819

Fair value of the warrant liability is estimated using an option-pricing model, which includes variables such as the expected volatility based on guideline public companies, the stock fair value, and the estimated time to a liquidity event. The significant assumptions used in preparing the option pricing model for valuing the Company’s warrants as of December 31, 2012 include (i) volatility (87%), (ii) risk free interest rate (0.16%—1.18%), (iii) strike price ($16), (iv) fair value of preferred shares ($2.35), and (v) expected life (1—7 years). The significant assumptions used in preparing the option pricing model for valuing the Company’s warrants as of September 30, 2013 include (i) volatility (69-87%), (ii) risk free interest rate (0.02%—1.705%), (iii) strike price ($128), (iv) fair value of common shares ($21.46), and (v) expected life (.22—5.98 years). See Note 7 for a description of the warrants issued in connection with the convertible notes.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Other comprehensive income (loss) and accumulated other comprehensive items

9 Months Ended

Sep. 30, 2013

Other comprehensive income (loss) and accumulated other comprehensive items

Other comprehensive income (loss) and accumulated other comprehensive items

4. Other comprehensive income (loss) and accumulated other comprehensive items

Other comprehensive income (loss) includes changes in equity that are excluded from net income (loss), such as unrealized gains and losses on marketable securities.

The following table summarizes other comprehensive loss and the changes in accumulated other comprehensive items for the three months ended September 30, 2013:

	Unrealized Losses On Marketable Securities			Total Accumulated Other Comprehensive Items

Balance at June 30, 2013	$	(772	)	$	(772	)
Other comprehensive loss before reclassifications	(39,695		)	(39,695		)
Amounts reclassified from other comprehensive items	—			—
Other comprehensive loss	(39,695		)	(39,695		)
Balance at September 30, 2013	$	(40,467	)	$	(40,467	)

The following table summarizes other comprehensive loss and the changes in accumulated other comprehensive items for the nine months ended September 30, 2013:

	Unrealized Losses On Marketable Securities			Total Accumulated Other Comprehensive Items

Balance at December 31, 2012	$	—		$	—
Other comprehensive loss before reclassifications	(40,467		)	(40,467		)
Amounts reclassified from other comprehensive items	—			—
Other comprehensive loss	(40,467		)	(40,467		)
Balance at September 30, 2013	$	(40,467	)	$	(40,467	)

- Definition

The entire disclosure for comprehensive income, which includes, but is not limited to, 1) the amount of income tax expense or benefit allocated to each component of other comprehensive income, including reclassification adjustments, 2) the reclassification adjustments for each classification of other comprehensive income and 3) the ending accumulated balances for each component of comprehensive income.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section 45
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=28358780&loc=d3e689-108580

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section 45
-Paragraph 1A
-URI http://asc.fasb.org/extlink&oid=28358780&loc=SL7669619-108580

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section 45
-Paragraph 12
-URI http://asc.fasb.org/extlink&oid=28358780&loc=d3e640-108580

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section 45
-Paragraph 17
-URI http://asc.fasb.org/extlink&oid=28358780&loc=d3e716-108580

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section 45
-Paragraph 16
-URI http://asc.fasb.org/extlink&oid=28358780&loc=d3e709-108580

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.3-04)
-URI http://asc.fasb.org/extlink&oid=27012166&loc=d3e187085-122770

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section 45
-Paragraph 11
-URI http://asc.fasb.org/extlink&oid=28358780&loc=d3e637-108580

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section 45
-Paragraph 14
-URI http://asc.fasb.org/extlink&oid=28358780&loc=d3e681-108580

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Reclassification Adjustments
-URI http://asc.fasb.org/extlink&oid=6522872

+ Details

Capital structure

9 Months Ended

Sep. 30, 2013

Capital structure

Capital structure

7. Capital structure

2013 Recapitalization

During January and February of 2013, the Company entered into a “bridge” financing arrangement with certain existing investors providing for the issuance by the Company of an aggregate of $6 million of convertible promissory notes and warrants to purchase 2,527,675 shares of Series One convertible preferred stock (Series One) and Series Two convertible preferred stock (Series Two). The warrants have a per share exercise price of $0.01, and as such, they are referred to as “penny warrants”. This bridge financing was closed in anticipation of the March 2013 Series Four financing event, which the Company refers to as the “2013 recapitalization”.

The Company allocated the proceeds of the convertible promissory notes between debt and warrant liability. Since the value of the warrants exceeded the proceeds from the convertible notes issued to existing investors, the value of the warrant in excess of the proceeds is considered a deemed dividend and reflected as an equity transaction in the financial statements. The Company recorded $6 million to interest expense related to the debt discount associated with the convertible debt during the quarter ended March 31, 2013.

On March 7, 2013, the Company closed a private placement of a new series of convertible preferred stock that resulted in the 2013 recapitalization. In this private placement, the Company issued and sold an aggregate of 4,497,035 shares of its Series Four senior preferred stock (Series Four) for an aggregate purchase price of approximately $54 million. Including the $6 million raised with the bridge financing, total gross proceeds raised during the quarter ended March 31, 2013 was approximately $60 million. In addition, the Company issued an aggregate of 502,919 shares of Series Four upon the share settlement of the convertible promissory notes described above that were issued in January and February 2013.

In connection with this private placement, the Company effected a one-for-120 reverse stock split of its common stock and an exchange of outstanding shares of Series One, Series Two and Series Three convertible preferred stock (Series Three) into an aggregate of 6,700,487 shares of a new series of Series Five junior preferred stock (Series Five). In addition, the Company issued an aggregate of 2,527,675 shares of Series One and Series Two upon the exercise of the warrants issued in connection with the bridge loan that were immediately exchanged for 2,095,515 shares of Series Five during the 2013 recapitalization.

The Company accounted for the 2013 recapitalization as an extinguishment of its Series One, Series Two and Series Three convertible preferred stock and recorded the Series Five shares at their fair value as of the recapitalization date. In accordance with authoritative accounting guidance, the Company recorded a gain attributable to the common stockholders on the extinguishment of the Series One, Series Two and Series Three. The gain of approximately $3.4 million represents the excess of the Series One, Series Two and Series Three over the fair value of the shares Series Five issued in connection with the recapitalization.

Valuation—The value of the Company was estimated using the PWERM. The PWERM considered the most significant near-term driver of value for the Company as the Company’s ability to complete a Phase 3 clinical trial of ataluren for the treatment of Duchenne muscular dystrophy caused by nonsense mutations (nmDMD). The remaining scenarios in the PWERM related to funding the completion of the Phase 3 clinical trial for nmDMD. The path to raising this money made up the remaining nodes in the PWERM.

After identifying the various potential liquidity scenarios and their likely timing, a pre-money enterprise value was assigned to each scenario based on a combination of management’s guidance and recent trends in the capital markets. The resulting enterprise value for each liquidity event was divided by the total shares that would be outstanding under each scenario to arrive at a price per share for the common and preferred classes of stock. Each scenario was then assigned an outcome probability based on management’s estimates. The resulting probability weighted share values were then discounted to present value at a rate that reflects general industry risks (but not Company specific risks).

The rights and preferences of the shares of Series Four and Series Five are as follows:

Dividends—The holders of Series Four and Series Five, in preference to the holders of common stock, are entitled to noncumulative dividends when and if declared by the Board of Directors.

Liquidation—Upon the liquidation, dissolution, reorganization or winding-up of the Company, the holders of Series Four will be entitled to receive, before any distribution or payment is made to any other class of security, an amount equal to the original issuance price, plus all declared, but unpaid, dividends. To the extent there are excess assets to distribute, the holders of Series Five will be entitled to receive, before any distribution or payment is made to the holders of the common stock, an amount equal to the stated liquidation preference, plus all declared, but unpaid, dividends. To the extent there are remaining assets to distribute, the holders of common stock will be entitled to receive such remaining assets.

Voting—Each holder of Series Four and Series Five are entitled to cast the number of votes into which such holder’s shares would convert. Except as required by law, holders of common stock have limited voting rights. Additionally, except as required by law, and except in certain enumerated circumstances, holders of Series Four and Series Five shall vote together with the holders of common stock as a single class.

Conversion—Each share of Series Four and Series Five is convertible at any time at the option of the holder into one share of common stock. These conversion ratios are subject to adjustment for certain dilutive events, including certain types of stock splits or stock dividends or future recapitalizations.

In May 2013, the Company issued and sold an additional 375,000 shares of Series Four, at a price per share of $12.00, for an aggregate purchase price of $4.5 million.

Common Stock

In May 2013, the Company’s Board of Directors and stockholders approved an amendment to the Company’s certificate of incorporation increasing the number of authorized shares of common stock to 125,000,000.

Initial Public Offering

In June 2013, the Company closed the initial public offering of its common stock pursuant to a registration statement on Form S-1, as amended. The Company issued and sold an aggregate of 9,627,800 shares of common stock under the registration statement at a public offering price of $15.00 per share, including 1,255,800 shares pursuant to the exercise by the underwriters of an over-allotment option. The Company received net proceeds from the initial public offering of approximately $131.6 million, after deducting underwriting discounts and commissions and other offering expenses payable by the Company.

Upon closing the initial public offering, all outstanding shares of the Series Four and Series Five were converted into 14,170,956 shares of common stock.

Warrants

All of the Company’s outstanding warrants were classified as liabilities as of December 31, 2012 because they contained either non-standard antidilution provisions or they were exercisable into preferred shares that included a put feature.

The following is a summary of the Company’s outstanding warrants as of December 31, 2012:

	Warrant shares	Exercise price		Expiration
Series Two	24,712	$	16.00	2014
Series Two	50,000	$	16.00	2017
Series Two	56,250	$	16.00	2019 and 2020
Common stock	645	$	2,520	2013 and 2014

In connection with the 2013 recapitalization, all of the Series Two outstanding warrants became warrants to purchase Series Five. In connection with the Company’s initial public offering all of the Series Five outstanding warrants became warrants to purchase common stock.

The following is a summary of the Company’s outstanding warrants as of September 30, 2013:

	Warrant shares	Exercise price		Expiration
Common stock	3,088	$	128.00	2014
Common stock	6,250	$	128.00	2017
Common stock	7,030	$	128.00	2019 and 2020
Common stock	645	$	2,520	2013 and 2014

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
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Reference 2: http://www.xbrl.org/2003/role/presentationRef
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Reference 3: http://www.xbrl.org/2003/role/presentationRef
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Reference 7: http://www.xbrl.org/2003/role/presentationRef
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Reference 8: http://www.xbrl.org/2003/role/presentationRef
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Reference 9: http://www.xbrl.org/2003/role/presentationRef
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Reference 10: http://www.xbrl.org/2003/role/presentationRef
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-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644

Reference 11: http://www.xbrl.org/2003/role/presentationRef
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Reference 12: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
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-Topic 505
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Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21564-112644

Reference 14: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
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-Paragraph d
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Reference 15: http://www.xbrl.org/2003/role/presentationRef
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Reference 16: http://www.xbrl.org/2003/role/presentationRef
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Reference 17: http://www.xbrl.org/2003/role/presentationRef
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Reference 18: http://www.xbrl.org/2003/role/presentationRef
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Reference 19: http://www.xbrl.org/2003/role/presentationRef
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-Name Regulation S-X (SX)
-Number 210
-Section 04
-Article 3

+ Details

Net income (loss) per share

9 Months Ended

Sep. 30, 2013

Net income (loss) per share

Net income (loss) per share

8. Net income (loss) per share

Basic earnings per share is computed by dividing net income (loss) available to common stockholders by the weighted-average number of common shares outstanding. Diluted earnings per share is computed by dividing net income (loss) available to common stockholders by the weighted-average number of common shares plus the effect of dilutive potential common shares outstanding during the period.

The Series One, Series Two and Series Three outstanding during 2012 (subsequent to the recapitalization) participated in the earnings of the Company through dividend rights. Accordingly, the Company measured earnings per share based upon the two-class method prior to the Company’s initial public offering in June 2013.

The following tables set forth the computation of basic and diluted net income (loss) per share for common stockholders:

	Three months ended September 30,
	2012			2013
Numerator
Net loss attributable to common stockholders	$	(7,297,125	)	$	(4,416,499	)
Denominator
Denominator for basic net loss per share	4,545			23,803,282
Net loss per share:
Basic and diluted	$	(1,605.53	)*	$	(0.19	)*

* In the three months ended September 30, 2012 and 2013, the Company experienced a net loss and therefore did not report any dilutive share impact.

	Nine months ended September 30,
	2012			2013
Numerator
Net loss	$	(19,963,058	)	$	(33,687,612	)
Deemed dividend	—			(18,248,768		)
Gain on exchange of convertible preferred stock in connection with recapitalization	159,954,069			3,390,750
Less beneficial conversion charge	(377,787		)	—
Less net income attributable to participating securities	(139,077,495		)	—
Net income (loss) attributable to common stockholders	$	535,729		$	(48,545,630	)
Denominator
Denominator for basic net income (loss) per share	2,937			8,995,167
Effect of dilutive securities
Series Three convertible preferred stock	10,656			—
Denominator for diluted net income (loss) per share	13,593			8,995,167
Net income (loss) per share:
Basic	$	182.41		$	(5.40	)*
Diluted	$	39.41		$	(5.40	)*

* In the nine months ended September 30, 2013, the Company experienced a net loss and therefore did not report any dilutive share impact.

The following table shows historical dilutive common share equivalents outstanding, which are not included in the above historical calculation, as the effect of their inclusion is anti-dilutive during each period.

	As of September 30,
	2012	2013

Stock Options	44,218	1,987,860
Unvested restricted stock	—	1,113,807
Total	44,218	3,101,667

Stock option plan

9 Months Ended

Sep. 30, 2013

Stock option plan

Stock option plan

9. Stock option plan

On March 5, 2013, the Company’s Board of Directors approved the 2013 Stock Incentive Plan, which provides for the granting of stock option awards, stock appreciation rights, restricted stock, restricted stock units and other stock-based awards in the aggregate of 739,937 shares of common stock. On March 5, 2013, the Board approved a grant of 735,324 shares of restricted stock and 4,613 stock options. There are no additional shares available for issuance under this plan.

In May 2013, the Company’s Board of Directors and stockholders increased by 2,500,000 the number of shares authorized under the 2009 Stock Incentive Plan, which provides for the granting of stock option awards, restricted stock awards, and other stock-based and cash-based awards.

In May 2013, the Company’s Board of Directors and stockholders approved the 2013 Long Term Incentive Plan, which became effective upon the closing of the Company’s IPO. The 2013 Long Term Incentive Plan provides for the grant of incentive stock options, nonstatutory stock options, restricted stock awards and other stock-based awards. The number of shares of common stock reserved for issuance under the 2013 Long Term Incentive Plan is the sum of (1) 122,296 shares of common stock available for issuance under the Company’s 2009 Equity and Long Term Incentive Plan and 2013 Stock Incentive Plan, (2) the number of shares (up to 3,040,444 shares) equal to the sum of the number of shares of common stock subject to outstanding awards under the Company’s 1998 Employee, Director and Consultant Stock Option Plan and 2013 Stock Incentive Plan that expire, terminate or are otherwise surrendered, cancelled, forfeited or repurchased by the Company at their original issuance price pursuant to a contractual repurchase right plus (3) an annual increase, to be added on the first day of each fiscal year until the expiration of the 2013 Long Term Incentive Plan, equal to the lowest of 2,500,000 shares of common stock, 4% of the number of shares of common stock outstanding on the first day of the fiscal year and an amount determined by the Company’s Board of Directors.

A summary of stock option activity is as follows:

	Number of options		Exercise price		Weighted- average exercise price		Weighted- average remaining contractual term	Aggregate intrinsic value
								(in thousands)
Outstanding at December 31, 2012	42,394		$	218.40-$1,149.60	$	469.48
Granted	2,007,713		$	10.59-$10.85	$	10.85
Exercised	—		—		—
Forfeited	(62,247	)	$	10.85—$1,149.60	$	17.10
Outstanding at September 30, 2013	1,987,860		$	10.59—$1,149.60	$	20.44	9.51 years	$	20,652
Exercisable at September 30, 2013	61,834		$	10.59—$1,149.60	$	290.39	6.06 years	$	265

The fair value of grants made in the period ended September 30, 2013 was contemporaneously estimated on the date of grant using the following assumptions:

		Nine months ended September 30, 2013
Risk-free interest rate		0.85%-1.69%
Expected volatility		87%-88%
Expected term		5.00 to 6.00 years
Expected dividend yield		0.0%

The Company assumed no expected dividends for all grants. The weighted average grant date fair value of options granted during the nine month period ended September 30, 2013 was $7.86 per share.

The Company uses the “simplified method” to determine the expected term of options. Under this method, the expected term represents the average of the vesting period and the contractual term. The expected volatility of share options was estimated based on a historical volatility analysis of peers that were similar to the Company with respect to industry, stage of life cycle, size, and financial leverage. The risk-free rate of the option is based on U.S. Government Securities Treasury Constant Maturities yields at the date of grant for a term similar to the expected term of the option.

Restricted Stock Awards—Restricted stock awards are granted subject to certain restrictions, including in some cases service conditions (restricted stock). The grant-date fair value of restricted stock awards, which has been determined based upon the market value of the Company’s shares on the grant date, is expensed over the vesting period.

The following table summarizes information on the Company’s restricted stock:

	Restricted Stock
	Number of Shares		Weighted Average Grant Date Fair Value
January 1, 2013	—		—
Granted	1,131,524		$	10.68
Vested	—		$	—
Forfeited	(17,717	)	$	10.63
Unvested at September 30, 2013	1,113,807		$	10.68

The Company recorded share-based compensation expense in the statement of operations as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2012		2013		2012		2013

Research and development	$	193,199	$	676,499	$	653,462	$	1,377,640
General and administrative	327,201		1,963,197		1,162,260		3,764,547
Total	$	520,400	$	2,639,696	$	1,815,722	$	5,142,187

As of December 31, 2012 and September 30, 2013, there was approximately $2.2 million and $21.0 million, respectively of total unrecognized compensation cost related to unvested share-based compensation arrangements granted under the 1998, 2009 and 2013 Plans. This cost is expected to be recognized as share-based compensation expense over the weighted average remaining service period of approximately 2.28 years.

Summary of significant accounting policies (Policies)	9 Months Ended
Summary of significant accounting policies (Policies)	Sep. 30, 2013
Summary of significant accounting policies
Basis of Presentation	Basis of Presentation The accompanying financial information as of September 30, 2013 and for the three and nine months ended September 30, 2012 and 2013 has been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (GAAP) have been condensed or omitted pursuant to such rules and regulations. These interim financial statements should be read in conjunction with the Company’s audited financial statements as of December 31, 2012 and notes thereto included in the final prospectus related to the Company’s initial public offering. In the opinion of management, the unaudited financial information as of September 30, 2013 and for three and nine months ended September 30, 2012 and 2013 reflects all adjustments, which are normal recurring adjustments, necessary to present a fair statement of financial position, results of operations and cash flows. The results of operations for the three and nine month periods ended September 30, 2013 are not necessarily indicative of the results to be expected for the year ended December 31, 2013 or for any other interim period or for any other future year.
Use of estimates	Use of estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Reverse stock split	Reverse stock split On March 7, 2013, the Company effected a one-for-120 reverse stock split of its common stock, pursuant to which each 120 shares of the Company’s outstanding common stock were reclassified and combined into one share of common stock. All common stock share and per share references in the financial statements and notes thereto have been restated to reflect the reverse stock split on a retroactive basis.
Marketable Securities	Marketable Securities Management determines the classification of marketable securities at the time of purchase and reevaluates such designation as of each balance sheet date. Marketable securities are classified as available-for-sale and carried at fair value, with any unrealized gain or loss recorded as a separate component of stockholders’ (deficit) equity.
Revenue recognition	Revenue recognition The Company recognizes revenue when amounts are realized or realizable and earned. Revenue is considered realizable and earned when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been rendered; (3) the price is fixed or determinable; and (4) collection of the amounts due are reasonably assured. The Company’s revenue is generated primarily through collaborative research and development and licensing agreements and grants. The terms of these agreements typically include payments to the Company of one or more of the following: nonrefundable, upfront license fees; milestone payments; research funding and royalties on future product sales. In addition, the Company generates service revenue through agreements that generally provide for fees for research and development services and may include additional payments upon achievement of specified events. For existing collaborations entered into prior to the adoption in 2011 of the revised multiple element revenue recognition guidance described below, the Company recognized revenue consistent with the approach established at the inception of each arrangement. For these existing collaborations, where the Company has continuing involvement, the Company recorded nonrefundable, upfront fees as deferred revenue and recognizes revenue on a straight-line basis as collaboration revenue over the expected performance period. For new collaborations or for material modifications made to existing collaborations, in 2011 and thereafter, the Company adopted the updated multiple element revenue recognition guidance. Under this guidance, all non-contingent arrangement consideration is allocated to the identified units of accounting based on their relative selling price at inception of the collaboration arrangement. The Company derives the selling price using a combination of internal subjective and available external objective information, such as comparable transactions. The Company recognizes revenue commensurate with delivery, such as in the case with delivery of a license, or ratably over the course of a service period, as appropriate, such as in the case of ongoing research and development activities. The Company evaluates all contingent consideration earned, such as a milestone payment, using the criteria as provided by the Financial Accounting Standards Board (FASB) guidance on the milestone method of revenue recognition. At the inception of a collaboration arrangement, the Company evaluates if milestone payments are substantive. The criteria requires that (1) the Company determines if the milestone is commensurate with either its performance to achieve the milestone or the enhancement of value resulting from its activities to achieve the milestone; (2) the milestone be related to past performance; and (3) the milestone be reasonable relative to all deliverable and payment terms of the collaboration arrangement. If these criteria are met then the contingent milestones can be considered as substantive milestones and will be recognized as revenue in the period that the milestone is achieved. The Company recognizes royalties as earned in accordance with the terms of various research and collaboration agreements. If not substantive, the contingent consideration is allocated to the existing units of accounting based on relative selling price and recognized following the same basis previously established for the associated unit of accounting. The Company recognizes revenue for reimbursements of research and development costs under collaboration agreements as the services are performed. The Company records these reimbursements as revenue and not as a reduction of research and development expenses as the Company has the risks and rewards as the principal in the research and development activities.
Fair value of financial instruments	Fair value of financial instruments The Company follows the fair value measurement rules, which provides guidance on the use of fair value in accounting and disclosure for assets and liabilities when such accounting and disclosure is called for by other accounting literature. These rules establish a fair value hierarchy for inputs to be used to measure fair value of financial assets and liabilities. This hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three levels: Level 1 (highest priority), Level 2, and Level 3 (lowest priority). · Level 1—Unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the balance sheet date. · Level 2—Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (i.e., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs). · Level 3—Inputs are unobservable and reflect the Company’s assumptions as to what market participants would use in pricing the asset or liability. The Company develops these inputs based on the best information available. Cash equivalents are reflected in the accompanying financial statements at fair value. The carrying amount of grant and collaboration receivables, accounts payable and accrued expenses, and debt approximates fair value due to the short-term nature of those instruments.
Warrant liability	Warrant liability Warrants to purchase the Company’s common stock with nonstandard antidilution provisions and preferred stock that include a put feature, regardless of the probability or likelihood that may conditionally obligate the issuer to ultimately transfer assets, are classified as liabilities and are recorded at their estimated fair value at each reporting period. Any change in fair value of these warrants is recorded as gain (loss) on warrant valuation each reporting period in Other income (expense), net on the Company’s statement of operations.
Share-based compensation	Share-based compensation The Company measures the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. For service type awards, share-based compensation expense is recognized on a straight-line basis over the period during which the employee is required to provide service in exchange for the entire award. For awards that vest or begin vesting upon achievement of a performance condition, the Company estimates the likelihood of satisfaction of the performance condition and recognizes compensation expense when achievement of the performance condition is deemed probable using an accelerated attribution model. The fair value of options is calculated using the Black-Scholes option pricing model to determine the fair value of stock options on the date of grant based on key assumptions, such as expected volatility and expected term. As a new public company, the Company does not have sufficient history to estimate the volatility of its common stock price or the expected life of the options. The Company calculates expected volatility based on reported data for similar publicly traded companies for which historical information is available and will continue to do so until the historical volatility of its common stock is sufficient to measure expected volatility for future option grants.

- Definition

Disclosure of accounting policy for revenue recognition. If the entity has different policies for different types of revenue transactions, the policy for each material type of transaction is generally disclosed. If a sales transaction has multiple element arrangements (for example, delivery of multiple products, services or the rights to use assets) the disclosure may indicate the accounting policy for each unit of accounting as well as how units of accounting are determined and valued. The disclosure may encompass important judgment as to appropriateness of principles related to recognition of revenue. The disclosure also may indicate the entity's treatment of any unearned or deferred revenue that arises from the transaction.

+ References + Details

Fair value of financial instruments and marketable securities (Tables)

9 Months Ended

Sep. 30, 2013

Fair value of financial instruments and marketable securities

Schedule of financial assets that are required to be measured at fair value on a recurring basis

	December 31, 2012
	Total		Quoted prices in active markets for identical assets (level 1)		Significant other observable inputs (level 2)		Significant unobservable inputs (level 3)
Warrant liability	$	95,661	$	—	$	—	$	95,661

	September 30, 2013
	Total		Quoted prices in active markets for identical assets (level 1)		Significant other observable inputs (level 2)		Significant unobservable inputs (level 3)
Marketable securities	$	133,182,565	$	—	$	133,182,565	$	—
Warrant liability	98,819		—		—		98,819

Summary of marketable securities accounted for as available-for-sale securities

	September 30, 2013
	Amortized		Gross Unrealized					Fair
	Cost		Gains		Losses			Value
Commercial paper	$	24,978,703	$	20,527	$	—		$	24,999,230
U.S. corporate debt securities	108,244,329		19,642		(80,636		)	108,183,335
	$	133,223,032	$	40,169	$	(80,636	)	$	133,182,565

Schedule of marketable securities on the balance sheet

	September 30, 2013
	Less Than 12 Months		More Than 12 Months
Commercial paper	$	24,999,230	$	—
U.S. corporate debt securities	57,824,657		50,358,678
Total Marketable securities	$	82,823,887	$	50,358,678

Summary of changes in the fair value of the Company's Level 3 valuation for warrant liability

	Level 3 assets
Beginning balance as of December 31, 2012	$	95,661
Warrants issued in connection with convertible promissory notes	6,000,000
Deemed dividend	18,248,768
Exercise of warrants issued in connection with convertible promissory notes	(24,248,765		)
Change in fair value of warrant liability	3,155
Ending balance as of September 30, 2013	$	98,819

Capital structure (Tables)

9 Months Ended

Sep. 30, 2013

Capital structure

Summary of the Company's outstanding warrants

The following is a summary of the Company’s outstanding warrants as of December 31, 2012:

	Warrant shares	Exercise price		Expiration
Series Two	24,712	$	16.00	2014
Series Two	50,000	$	16.00	2017
Series Two	56,250	$	16.00	2019 and 2020
Common stock	645	$	2,520	2013 and 2014

The following is a summary of the Company’s outstanding warrants as of September 30, 2013:

	Warrant shares	Exercise price		Expiration
Common stock	3,088	$	128.00	2014
Common stock	6,250	$	128.00	2017
Common stock	7,030	$	128.00	2019 and 2020
Common stock	645	$	2,520	2013 and 2014

- Definition

Tabular disclosure of warrants or rights issued. Warrants and rights outstanding are derivative securities that give the holder the right to purchase securities (usually equity) from the issuer at a specific price within a certain time frame. Warrants are often included in a new debt issue to entice investors by a higher return potential. The main difference between warrants and call options is that warrants are issued and guaranteed by the company, whereas options are exchange instruments and are not issued by the company. Also, the lifetime of a warrant is often measured in years, while the lifetime of a typical option is measured in months. Disclose the title of issue of securities called for by warrants and rights outstanding, the aggregate amount of securities called for by warrants and rights outstanding, the date from which the warrants or rights are exercisable, and the price at which the warrant or right is exercisable.

+ References + Details

Net income (loss) per share (Tables)

9 Months Ended

Sep. 30, 2013

Net income (loss) per share

Schedule of computation of basic and diluted net income (loss) per share for common stockholders

	Three months ended September 30,
	2012			2013
Numerator
Net loss attributable to common stockholders	$	(7,297,125	)	$	(4,416,499	)
Denominator
Denominator for basic net loss per share	4,545			23,803,282
Net loss per share:
Basic and diluted	$	(1,605.53	)*	$	(0.19	)*

* In the three months ended September 30, 2012 and 2013, the Company experienced a net loss and therefore did not report any dilutive share impact.

	Nine months ended September 30,
	2012			2013
Numerator
Net loss	$	(19,963,058	)	$	(33,687,612	)
Deemed dividend	—			(18,248,768		)
Gain on exchange of convertible preferred stock in connection with recapitalization	159,954,069			3,390,750
Less beneficial conversion charge	(377,787		)	—
Less net income attributable to participating securities	(139,077,495		)	—
Net income (loss) attributable to common stockholders	$	535,729		$	(48,545,630	)
Denominator
Denominator for basic net income (loss) per share	2,937			8,995,167
Effect of dilutive securities
Series Three convertible preferred stock	10,656			—
Denominator for diluted net income (loss) per share	13,593			8,995,167
Net income (loss) per share:
Basic	$	182.41		$	(5.40	)*
Diluted	$	39.41		$	(5.40	)*

* In the nine months ended September 30, 2013, the Company experienced a net loss and therefore did not report any dilutive share impact.

Schedule of historical dilutive common share equivalents outstanding

	As of September 30,
	2012	2013

Stock Options	44,218	1,987,860
Unvested restricted stock	—	1,113,807
Total	44,218	3,101,667

Stock option plan (Tables)

9 Months Ended

Sep. 30, 2013

Stock option plan

Summary of stock option activity

	Number of options		Exercise price		Weighted- average exercise price		Weighted- average remaining contractual term	Aggregate intrinsic value
								(in thousands)
Outstanding at December 31, 2012	42,394		$	218.40-$1,149.60	$	469.48
Granted	2,007,713		$	10.59-$10.85	$	10.85
Exercised	—		—		—
Forfeited	(62,247	)	$	10.85—$1,149.60	$	17.10
Outstanding at September 30, 2013	1,987,860		$	10.59—$1,149.60	$	20.44	9.51 years	$	20,652
Exercisable at September 30, 2013	61,834		$	10.59—$1,149.60	$	290.39	6.06 years	$	265

Schedule of assumptions used to estimate fair value of grants made on the date of grant

		Nine months ended September 30, 2013
Risk-free interest rate		0.85%-1.69%
Expected volatility		87%-88%
Expected term		5.00 to 6.00 years
Expected dividend yield		0.0%

Summary of information on the Company's restricted stock

	Restricted Stock
	Number of Shares		Weighted Average Grant Date Fair Value
January 1, 2013	—		—
Granted	1,131,524		$	10.68
Vested	—		$	—
Forfeited	(17,717	)	$	10.63
Unvested at September 30, 2013	1,113,807		$	10.68

Schedule of share-based compensation expense recorded in the statement of operations

	Three Months Ended September 30,				Nine Months Ended September 30,
	2012		2013		2012		2013

Research and development	$	193,199	$	676,499	$	653,462	$	1,377,640
General and administrative	327,201		1,963,197		1,162,260		3,764,547
Total	$	520,400	$	2,639,696	$	1,815,722	$	5,142,187

Fair value of financial instruments and marketable securities (Details 4) - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2013	Dec. 31, 2012
Changes in the fair value of warrant liability
Deemed dividend	$ 18,248,768
Warrant
Changes in the fair value of warrant liability
Beginning balance	95,661
Warrants issued in connection with convertible promissory notes	6,000,000
Deemed dividend	18,248,768
Exercise of warrants issued in connection with convertible promissory notes	(24,248,765)
Change in fair value of warrant liability	3,155
Ending balance	$ 98,819	$ 95,661
Assumption used to estimate the fair value of warrant liability by utilizing the Black-Scholes option-pricing model
Volatility (as a percent)		87.00%
Strike price (in dollars per share)	$ 128	$ 16
Warrant \| Minimum
Assumption used to estimate the fair value of warrant liability by utilizing the Black-Scholes option-pricing model
Volatility (as a percent)	69.00%
Risk-free interest rate (as a percent)	0.02%	0.16%
Expected life	2 months 19 days	1 year
Warrant \| Maximum
Assumption used to estimate the fair value of warrant liability by utilizing the Black-Scholes option-pricing model
Volatility (as a percent)	87.00%
Risk-free interest rate (as a percent)	1.705%	1.18%
Expected life	5 years 11 months 23 days	7 years
Warrant \| Preferred shares
Assumption used to estimate the fair value of warrant liability by utilizing the Black-Scholes option-pricing model
Fair value of common shares (in dollars per share)	$ 21.46	$ 2.35

Accounts payable and accrued expenses (Details) - USD ($)	Sep. 30, 2013	Dec. 31, 2012
Accounts payable and accrued expenses
Employee compensation, benefits, and related accruals	$ 3,659,084	$ 3,096,475
Consulting and contracted research	3,556,350	2,515,678
Professional fees	1,532,458	559,228
Accounts payable	1,017,122	621,591
Other	440,479	230,999
Accounts payable and accrued expenses	$ 10,205,493	$ 7,023,971

Capital structure (Details)		1 Months Ended		3 Months Ended	9 Months Ended
Capital structure (Details)	Mar. 07, 2013 USD ($) shares	Jun. 30, 2013 USD ($) $ / shares shares	May 31, 2013 USD ($) $ / shares shares	Mar. 31, 2013 USD ($)	Sep. 30, 2013 USD ($) shares	Sep. 30, 2012 USD ($)	Feb. 28, 2013 USD ($) $ / shares shares	Dec. 31, 2012 shares
Capital structure
Aggregate gross proceeds \| $						$ 29,354,752
Gross proceeds raised \| $				$ 60,000,000
Gain on extinguishment of shares of Series One, Two and Three stock \| $					$ 3,390,750	$ 159,954,069
Common stock
Common stock, Authorized shares \| shares			125,000,000		125,000,000			17,000,000
Initial Public Offering
Net proceeds from initial public offering after deducting underwriting discounts and commissions and other offering expenses payable \| $					$ 131,649,688
Series One and Series Two \| Warrants
Capital structure
Warrants issued to purchase shares \| shares							2,527,675
Exercise price (in dollars per share) \| $ / shares							0.01
Shares issued and sold \| shares	2,527,675
Series Four
Capital structure
Shares issued and sold \| shares	4,497,035		375,000
Aggregate gross proceeds \| $	$ 54,000,000
Share price (in dollars per share) \| $ / shares			$ 12.00
Aggregate purchase price \| $			$ 4,500,000
Series Five
Capital structure
Number of shares issued upon conversion \| shares	6,700,487
Series Five \| Warrants
Capital structure
Number of shares issued upon conversion \| shares	2,095,515
Common stock
Capital structure
Shares issued and sold \| shares		9,627,800
Reverse stock split ratio	0.0083
Share price (in dollars per share) \| $ / shares		$ 15.00
Initial Public Offering
Common stock shares issuable pursuant to the exercise by the underwriters of an over-allotment option \| shares		1,255,800
Net proceeds from initial public offering after deducting underwriting discounts and commissions and other offering expenses payable \| $		$ 131,600,000
Series Four and Series Five Convertible Preferred Stock
Capital structure
Number of shares issued upon conversion \| shares		14,170,956
Convertible promissory notes
Capital structure
Principal amount of convertible promissory notes issued \| $							$ 6,000,000
Debt discount recorded to interest expense \| $				6,000,000
Amount raised in bridge financing \| $				$ 6,000,000
Convertible promissory notes \| Series Four
Capital structure
Shares issued upon conversion of convertible promissory notes \| shares	502,919

Net income (loss) per share (Details) - USD ($)	3 Months Ended		9 Months Ended
Net income (loss) per share (Details) - USD ($)	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Numerator
Net loss	$ (4,416,499)	$ (7,297,125)	$ (33,687,612)	$ (19,963,058)
Deemed dividend			(18,248,768)
Gain on exchange of convertible preferred stock in connection with recapitalization			3,390,750	159,954,069
Less beneficial conversion charge				(377,787)
Less net income attributable to participating securities				(139,077,495)
Net loss attributable to common stockholders	$ (4,416,499)	$ (7,297,125)	$ (48,545,630)	$ 535,729
Denominator
Denominator for basic net income (loss) per share (in shares)	23,803,282	4,545	8,995,167	2,937
Effect of dilutive securities Series Three convertible preferred stock (in shares)				10,656
Denominator for diluted net income (loss) per share (in shares)	23,803,282	4,545	8,995,167	13,593
Net loss per share:
Basic and diluted (in dollars per share)	$ (0.19)	$ (1,605.53)
Basic (in dollars per share)	(0.19)	(1,605.53)	$ (5.40)	$ 182.41
Diluted (in dollars per share)	$ (0.19)	$ (1,605.53)	$ (5.40)	$ 39.41

Stock option plan (Details) - USD ($) $ / shares in Units, $ in Thousands		1 Months Ended	9 Months Ended
	Mar. 05, 2013	May 31, 2013	Sep. 30, 2013
Restricted stock
Number of Shares
Granted (in shares)			1,131,524
Forfeited (in shares)			(17,717)
Unvested at the end of the period (in shares)			1,113,807
Weighted Average Grant Date Fair Value
Granted (in dollars per share)			$ 10.68
Forfeited (in dollars per share)			10.63
Unvested at the end of the period (in dollars per share)			$ 10.68
Stock options
Number of options
Outstanding at the beginning of the period (in shares)			42,394
Granted (in shares)			2,007,713
Forfeited (in shares)			(62,247)
Outstanding at the end of the period (in shares)			1,987,860
Exercisable at the end of the period (in shares)			61,834
Weighted-average exercise price
Outstanding at the beginning of the period (in dollars per share)			$ 469.48
Granted (in dollars per share)			10.85
Forfeited (in dollars per share)			17.10
Outstanding at the end of the period (in dollars per share)			20.44
Exercisable at the end of the period (in dollars per share)			$ 290.39
Weighted-average remaining contractual term
Outstanding at the end of the period			9 years 6 months 4 days
Exercisable at the end of the period			6 years 22 days
Aggregate intrinsic value
Outstanding at the end of the period (in dollars)			$ 20,652
Exercisable at the end of the period (in dollars)			$ 265
Valuation assumptions
Expected dividend yield (as a percent)			0.00%
Weighted average grant date fair value (in dollars per share)			$ 7.86
Stock options \| Minimum
Exercise price
Outstanding at the beginning of the period (in dollars per share)			218.40
Granted (in dollars per share)			10.59
Forfeited (in dollars per share)			10.85
Outstanding at the end of the period (in dollars per share)			10.59
Exercisable at the end of the period (in dollars per share)			$ 10.59
Valuation assumptions
Risk-free interest rate (as a percent)			0.85%
Expected volatility (as a percent)			87.00%
Expected term			5 years
Stock options \| Maximum
Exercise price
Outstanding at the beginning of the period (in dollars per share)			$ 1,149.60
Granted (in dollars per share)			10.85
Forfeited (in dollars per share)			1,149.60
Outstanding at the end of the period (in dollars per share)			1,149.60
Exercisable at the end of the period (in dollars per share)			$ 1,149.60
Valuation assumptions
Risk-free interest rate (as a percent)			1.69%
Expected volatility (as a percent)			88.00%
Expected term			6 years
2013 Stock Incentive Plan \| Restricted stock
Number of options
Granted (in shares)	735,324
2013 Stock Incentive Plan \| Stock options
Number of options
Granted (in shares)	4,613
2013 Stock Incentive Plan \| Common stock
Stock option plan
Number of shares authorized	739,937
2009 Stock Incentive Plan
Stock option plan
Number of additional shares authorized		2,500,000
2013 Long Term Incentive Plan \| Common stock \| Minimum
Stock option plan
Annual increase in the number of shares on the first day of the fiscal year		2,500,000
Annual increase in the number of shares outstanding on the first day of the fiscal year (as a percent)		4.00%
2013 Long Term Incentive Plan \| Common stock \| Maximum
Stock option plan
Number of shares subject to outstanding awards		3,040,444
2009 Equity and Long Term Incentive Plan and 2013 Stock Incentive Plan \| Common stock
Stock option plan
Number of shares available for issuance		122,296

The Company	9 Months Ended
The Company	Sep. 30, 2013
The Company
The Company	1. The Company PTC Therapeutics, Inc. (the Company or PTC) was incorporated as a Delaware corporation on March 31, 1998. The Company is a biopharmaceutical company focused on the discovery and development of orally administered, proprietary small-molecule drugs that target post-transcriptional control processes. The Company has devoted substantially all of its efforts to research and development, including clinical trials. The Company has not completed development of any drugs. The Company has not generated product revenue to date and is subject to a number of risks similar to those of other early stage companies, including dependence on key individuals, the difficulties inherent in the development of commercially usable products, the potential need to obtain additional capital necessary to fund the development of its products, and competition from other companies. As of September 30, 2013, the Company had an accumulated deficit of approximately $310.9 million. The Company has financed its operations to date primarily through the issuance and sale of its common stock in its initial public offering (see note 7 below), private placements of its convertible preferred stock, collaborations, bank debt, convertible debt financings, grant funding and clinical trial support from governmental and philanthropic organizations and patient advocacy groups in the disease areas addressed by the Company’s product candidates. The Company believes that its existing cash, cash equivalents, including the Company’s net proceeds from its initial public offering of common stock, and marketable securities provide for sufficient resources to fund its currently planned operations through the fourth quarter of 2015.

Debt	9 Months Ended
Debt	Sep. 30, 2013
Debt
Debt	6. Debt In July 2013, the Company paid in full the outstanding principal and interest of $2.6 million due under promissory notes issued in connection with a $25 million secured debt facility with a syndicate of two lenders. The notes were secured by substantially all of the Company’s assets except for intellectual property and carried a fixed interest rate of 13.65%. As a result of this transaction, the Company recorded a loss on extinguishment of debt of $0.1 million on the Company’s statement of operations for the three months ended September 30, 2013, The loss on extinguishment of debt primarily represented the write off of related deferred financing costs, the acceleration of recognition of debt extinguishment fees and the prepayment premium payable.

Collaboration Revenue	9 Months Ended
Collaboration Revenue	Sep. 30, 2013
Collaboration Revenue.
Collaboration Revenue	10. Collaboration Revenue On August 8, 2013, the Company announced the selection of a development candidate in its spinal muscular atrophy collaboration with F. Hoffman-La Roche Ltd and Hoffman-La Roche Inc. (Roche) and the Spinal Muscular Atrophy Foundation. The achievement of this milestone triggered a $10.0 million payment to the Company from Roche. The Company considered this milestone event substantive because the applicable criteria of its revenue recognition policy (see Note 2) would be satisfied and recorded it as collaboration revenue for the three months ended September 30, 2013.

The Company (Details) - USD ($)	Sep. 30, 2013	Dec. 31, 2012
The Company
Accumulated deficit	$ 310,912,330	$ 277,224,718

Debt (Details)	1 Months Ended	3 Months Ended	9 Months Ended
Debt (Details)	Jul. 31, 2013 USD ($) item	Sep. 30, 2013 USD ($)	Sep. 30, 2013 USD ($)
Debt
Paid outstanding principal and interest, due under promissory notes issued	$ 2,600,000
Loss on extinguishment of debt		$ (129,963)	$ (129,963)
Secured debt facility
Debt
Maximum borrowing capacity	$ 25,000,000
Number of lenders \| item	2
Fixed interest rate of notes (as a percent)	13.65%

Statements of comprehensive loss - USD ($)	3 Months Ended		9 Months Ended
Statements of comprehensive loss - USD ($)	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Statements of comprehensive loss
Net loss	$ (4,416,499)	$ (7,297,125)	$ (33,687,612)	$ (19,963,058)
Other comprehensive loss:
Unrealized loss on marketable securities	(39,695)		(40,467)
Comprehensive loss	$ (4,456,194)	$ (7,297,125)	$ (33,728,079)	$ (19,963,058)

Summary of significant accounting policies (Details)	Mar. 07, 2013
Common stock
Reverse stock split
Reverse stock split ratio	0.0083

Fair value of financial instruments and marketable securities (Details) - USD ($)	Sep. 30, 2013	Dec. 31, 2012
Financial assets measured at fair value on recurring basis
Marketable securities	$ 133,182,565
Recurring basis \| Total
Financial assets measured at fair value on recurring basis
Marketable securities	133,182,565
Warrant liability	98,819	$ 95,661
Recurring basis \| Significant other observable inputs (level 2)
Financial assets measured at fair value on recurring basis
Marketable securities	133,182,565
Recurring basis \| Significant unobservable inputs (level 3)
Financial assets measured at fair value on recurring basis
Warrant liability	$ 98,819	$ 95,661

Fair value of financial instruments and marketable securities (Details 2)	9 Months Ended
	Sep. 30, 2013 USD ($)
Marketable securities accounted for as available-for-sale securities
Amortized Cost	$ 133,223,032
Gross Unrealized Gains	40,169
Gross Unrealized Losses	(80,636)
Total Marketable securities	133,182,565
Commercial paper
Marketable securities accounted for as available-for-sale securities
Amortized Cost	24,978,703
Gross Unrealized Gains	20,527
Total Marketable securities	24,999,230
U.S. corporate debt securities
Marketable securities accounted for as available-for-sale securities
Amortized Cost	108,244,329
Gross Unrealized Gains	19,642
Gross Unrealized Losses	(80,636)
Total Marketable securities	$ 108,183,335

Fair value of financial instruments and marketable securities (Details 3) - USD ($)	Sep. 30, 2013	Dec. 31, 2012
Marketable securities on the balance sheet
Total Marketable securities, Less Than 12 Months	$ 82,823,887
Total Marketable securities, More Than 12 Months	50,358,678
Marketable securities		$ 0
Commercial paper
Marketable securities on the balance sheet
Total Marketable securities, Less Than 12 Months	24,999,230
U.S. corporate debt securities
Marketable securities on the balance sheet
Total Marketable securities, Less Than 12 Months	57,824,657
Total Marketable securities, More Than 12 Months	$ 50,358,678

Capital structure (Details 2) - Warrants	Sep. 30, 2013 $ / shares shares	Dec. 31, 2012 $ / shares shares
Series Two \| 2014
Warrants
Warrant shares \| shares		24,712
Exercise price (in dollars per share) \| $ / shares		16.00
Series Two \| 2017
Warrants
Warrant shares \| shares		50,000
Exercise price (in dollars per share) \| $ / shares		16.00
Series Two \| 2019 and 2020
Warrants
Warrant shares \| shares		56,250
Exercise price (in dollars per share) \| $ / shares		16.00
Common stock \| 2014
Warrants
Warrant shares \| shares	3,088
Exercise price (in dollars per share) \| $ / shares	128.00
Common stock \| 2017
Warrants
Warrant shares \| shares	6,250
Exercise price (in dollars per share) \| $ / shares	128.00
Common stock \| 2019 and 2020
Warrants
Warrant shares \| shares	7,030
Exercise price (in dollars per share) \| $ / shares	128.00
Common stock \| 2013 and 2014
Warrants
Warrant shares \| shares	645	645
Exercise price (in dollars per share) \| $ / shares	2,520	2,520

Net income (loss) per share (Details 2) - shares	9 Months Ended
Net income (loss) per share (Details 2) - shares	Sep. 30, 2013	Sep. 30, 2012
Net income (loss) per share
Total shares excluded from calculation	3,101,667	44,218
Stock Options
Net income (loss) per share
Total shares excluded from calculation	1,987,860	44,218
Unvested restricted stock
Net income (loss) per share
Total shares excluded from calculation	1,113,807

Stock option plan (Details 2) - USD ($)	3 Months Ended		9 Months Ended
Stock option plan (Details 2) - USD ($)	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Share-based compensation expense recorded in the statement of operations
Share-based compensation expense	$ 2,639,696	$ 520,400	$ 5,142,187	$ 1,815,722
Research and development
Share-based compensation expense recorded in the statement of operations
Share-based compensation expense	676,499	193,199	1,377,640	653,462
General and administrative
Share-based compensation expense recorded in the statement of operations
Share-based compensation expense	$ 1,963,197	$ 327,201	$ 3,764,547	$ 1,162,260

Stock option plan (Details 3) - 1998, 2009 and 2013 Plans - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2013	Dec. 31, 2012
Additional disclosures
Unrecognized compensation cost	$ 21.0	$ 2.2
Weighted average remaining service period for recognition of unrecognized compensation cost	2 years 3 months 11 days

Collaboration Revenue (Details) $ in Millions	Aug. 08, 2013 USD ($)
Collaboration Revenue.
Milestone payment received from Roche	$ 10.0