Document and Entity Information	6 Months Ended
Document and Entity Information	Jun. 30, 2011	Aug. 10, 2011
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2011
Document Fiscal Year Focus	2011
Document Fiscal Period Focus	Q2
Trading Symbol	GALT
Entity Registrant Name	GALECTIN THERAPEUTICS INC
Entity Central Index Key	0001133416
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		74,106,869

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) In Thousands, unless otherwise specified	Jun. 30, 2011	Dec. 31, 2010
Current assets:
Cash and cash equivalents	$ 7,984	$ 5,891
Grant receivable		234
Prepaid expenses and other current assets	71	70
Total current assets	8,055	6,195
Property and equipment, net	3	7
Restricted cash	64	59
Intangible assets, net	38	39
Total assets	8,160	6,300
Current liabilities:
Accounts payable	129	125
Accrued expenses	376	537
Accrued dividends payable	81	48
Deferred revenue	200	200
Warrant liabilities		861
Total current liabilities	786	1,771
Other long-term liabilities	3	12
Total liabilities	789	1,783
Commitments and contingencies (Note 9)
Stockholders' equity (deficit):
Undesignated stock, $0.01 par value; 20,000,000 shares authorized at June 30, 2011 and December 31, 2010, 8,001,000 designated at June 30, 2011 and December 31, 2010
Common stock, $0.001 par value; 300,000,000 shares authorized at June 30, 2011 and December 31, 2010, 74,056,869 and 63,909,155 issued and outstanding at June 30, 2011 and December 31, 2010, respectively	74	64
Additional paid-in capital	63,289	54,022
Deficit accumulated during the development stage	(63,080)	(56,424)
Total stockholders' equity (deficit)	915	(1,694)
Total liabilities, redeemable convertible preferred stock and stockholders' equity (deficit)	8,160	6,300
Series B-1 12% Redeemable Convertible Preferred Stock
Stockholders' equity (deficit):
Convertible preferred stock, value	1,673	1,664
Series B-2 12% redeemable convertible preferred stock
Stockholders' equity (deficit):
Convertible preferred stock, value	2,580	2,474
Series C super dividend convertible preferred stock
Stockholders' equity (deficit):
Convertible preferred stock, value	2,203	2,073
Series A 12% convertible preferred stock
Stockholders' equity (deficit):
Series A 12% convertible preferred stock; 5,000,000 shares authorized, 1,562,500 and 1,592,500 issued and outstanding at June 30, 2011 and December 31, 2010, respectively	$ 632	$ 644

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)	Jun. 30, 2011	Dec. 31, 2010
Undesignated stock, par value	$ 0.01	$ 0.01
Undesignated stock, shares authorized	20,000,000	20,000,000
Undesignated stock, designated	8,001,000	8,001,000
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	300,000,000	300,000,000
Common stock, issued	74,056,869	63,909,155
Common stock, outstanding	74,056,869	63,909,155
Series B-1 12% Redeemable Convertible Preferred Stock
Convertible preferred stock, shares authorized	900,000	900,000
Convertible preferred stock, issued	900,000	900,000
Convertible preferred stock, outstanding	900,000	900,000
Convertible preferred stock, redemption value	$ 1,800,000
Convertible preferred stock, liquidation value	1,800,000
Series B-2 12% redeemable convertible preferred stock
Convertible preferred stock, shares authorized	2,100,000	2,100,000
Convertible preferred stock, issued	2,100,000	2,100,000
Convertible preferred stock, outstanding	2,100,000	2,100,000
Convertible preferred stock, redemption value	4,200,000
Convertible preferred stock, liquidation value	4,200,000
Series C super dividend convertible preferred stock
Convertible preferred stock, shares authorized	1,000	1,000
Convertible preferred stock, issued	225	212
Convertible preferred stock, outstanding	225	212
Convertible preferred stock, redemption value	4,500,000
Convertible preferred stock, liquidation value	$ 2,250,000
Series A 12% convertible preferred stock
Convertible preferred stock, shares authorized	5,000,000	5,000,000
Convertible preferred stock, issued	1,562,500	1,592,500
Convertible preferred stock, outstanding	1,562,500	1,592,500

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended		132 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011
Operating expenses:
Research and development	$ 1,291	$ 234	$ 2,035	$ 363	$ 21,566
General and administrative	1,700	1,116	2,969	2,019	37,776
Total operating expenses	2,991	1,350	5,004	2,382	59,342
Total operating loss	(2,991)	(1,350)	(5,004)	(2,382)	(59,342)
Other income (expense):
Interest income	4	1	9	1	785
Interest expense					(4,451)
Change in fair value of convertible debt instrument					(3,426)
Change in fair value of warrant liabilities	(140)	(305)	(524)	(1,411)	9,022
Other income					491
Total other income (expense)	(136)	(304)	(515)	(1,410)	2,421
Net loss	(3,127)	(1,654)	(5,519)	(3,792)	(56,921)
Preferred stock dividends	(750)	(227)	(1,022)	(425)	(2,713)
Preferred stock accretion	(57)	(594)	(115)	(1,075)	(3,700)
Net loss applicable to common stockholders	$ (3,934)	$ (2,475)	$ (6,656)	$ (5,292)	$ (63,334)
Net loss per common share - basic and diluted	$ (0.06)	$ (0.05)	$ (0.10)	$ (0.10)
Weighted average common shares outstanding - basic and diluted	69,540	53,911	68,243	51,916

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT) (USD $) In Thousands, except Share data	Total USD ($)	Series A 12% convertible preferred stock USD ($)	Series C super dividend convertible preferred stock USD ($)	Series B-1 12% Redeemable Convertible Preferred Stock USD ($)	Series B-2 12% redeemable convertible preferred stock USD ($)	Series C super dividend convertible preferred stock USD ($)	Series A 12% convertible preferred stock USD ($)	Common Stock USD ($)	Common Stock Series A 12% convertible preferred stock	Common Stock Series B-1 12% Redeemable Convertible Preferred Stock	Common Stock Series B-2 12% redeemable convertible preferred stock USD ($)	Common Stock Series C super dividend convertible preferred stock	Additional Paid-In Capital USD ($)	Additional Paid-In Capital Series A 12% convertible preferred stock USD ($)	Additional Paid-In Capital Series B-1 12% Redeemable Convertible Preferred Stock USD ($)	Additional Paid-In Capital Series B-2 12% redeemable convertible preferred stock USD ($)	Additional Paid-In Capital Series C super dividend convertible preferred stock USD ($)	Deficit Accumulated During the Development Stage USD ($)	Deficit Accumulated During the Development Stage Series A 12% convertible preferred stock USD ($)	Deficit Accumulated During the Development Stage Series B-1 12% Redeemable Convertible Preferred Stock USD ($)	Deficit Accumulated During the Development Stage Series B-2 12% redeemable convertible preferred stock USD ($)	Deficit Accumulated During the Development Stage Series C super dividend convertible preferred stock USD ($)
Beginning Balance at Dec. 31, 2010	$ (1,694)			$ 1,664	$ 2,474	$ 2,073	$ 644	$ 64					$ 54,022					$ (56,424)
Beginning Balance (in shares) at Dec. 31, 2010				900,000	2,100,000	212	1,592,500	63,909,155
Accretion of Series B redeemable convertible preferred stock	(88)			9	79													(88)
Accretion of beneficial conversion feature for Series B-2	(27)				27													(27)
Issuance of Series C super dividend convertible preferred stock (in shares)						13
Issuance of Series C super dividend convertible preferred stock						130
Issuance of restricted common stock								125,000
Issuance of common stock upon exercise of warrants (in shares)								8,198,794
Issuance of common stock upon exercise of warrants	6,002							8					5,994
Issuance of common stock upon exercise of options (in shares)								913,000
Issuance of common stock upon exercise of options	234							1					233
Conversion of Series A to common stock (in shares)							(30,000)	30,000
Conversion of Series A to common stock							(12)						12
Stock-based compensation expense	2,039												2,039
Net loss	(5,519)																	(5,519)
Convertible preferred stock dividend		1	(33)								1			96	258	601	34		(95)	(258)	(602)	(67)
Convertible preferred stock dividend (in shares)									88,096	228,286	532,664	31,874
Ending Balance at Jun. 30, 2011	$ 915			$ 1,673	$ 2,580	$ 2,203	$ 632	$ 74					$ 63,289					$ (63,080)
Ending Balance (in shares) at Jun. 30, 2011				900,000	2,100,000	225	1,562,500	74,056,869

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) In Thousands, unless otherwise specified	6 Months Ended		132 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (5,519)	$ (3,792)	$ (56,921)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	5	8	542
Stock-based compensation expense	2,039	1,171	8,376
Non-cash interest expense			4,279
Change in fair value of convertible debt instrument			3,426
Change in fair value of warrant liabilities	524	1,411	(9,022)
Write off of intangible assets			351
Changes in operating assets and liabilities:
Grant receivable	234
Prepaid expenses and other current assets	(1)	(14)	(68)
Accounts payable and accrued expenses	(156)	(190)	774
Other long-term liabilities	(9)	(286)	3
Net cash used in operating activities	(2,883)	(1,692)	(48,260)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment			(421)
Change in restricted cash	(5)		(64)
Increase in patents costs and other assets			(404)
Net cash used in investing activities	(5)		(889)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuance of convertible debt instruments			10,621
Repayment of convertible debt instruments			(1,641)
Proceeds from exercise of common stock warrants and options	4,851	2,841	10,077
Proceeds from shareholder advances			9
Net cash provided by financing activities	4,981	4,304	57,133
NET INCREASE IN CASH AND CASH EQUIVALENTS	2,093	2,612	7,984
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	5,891	251
CASH AND CASH EQUIVALENTS, END OF PERIOD	7,984	2,863	7,984
SUPPLEMENTAL DISCLOSURE - Cash paid for interest			114
NONCASH FINANCING ACTIVITIES:
Issuance of equity warrants in connection with equity offerings		1,029	5,037
Conversion of accrued expenses into common stock			303
Cashless exercise of stock options			98
Conversion and redemption of convertible notes and accrued interest into common stock			12,243
Conversion of extension costs related to convertible notes into common stock			171
Payment of preferred stock dividends in common stock	1,022	425	2,713
Issuance of warrants to induce conversion of notes payable			503
Issuance of stock to acquire Pro-Pharmaceuticals-NV			107
Common Stock
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuance of stock and warrants			28,690
Series A 12% convertible preferred stock
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuance of stock and warrants			1,691
Series B-1 12% Redeemable Convertible Preferred Stock
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuance of stock and warrants			1,548
Series B-2 12% redeemable convertible preferred stock
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuance of stock and warrants		1,463	3,935
Series C super dividend convertible preferred stock
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuance of stock and warrants	$ 130		$ 2,203

Basis of Presentation

132 Months Ended

Jun. 30, 2011

Basis of Presentation

1.	Basis of Presentation

Galectin Therapeutics, Inc. (the “Company”) is a development-stage company that is applying its leadership in galectin science and drug development to create new therapies for fibrotic disease and cancer. These candidates are based on the Company’s targeting of galectin proteins which are key mediators of biologic and pathologic function. These compounds also may have application for drugs to treat other diseases and chronic health conditions. The Company was founded in July 2000, was incorporated in the State of Nevada in January 2001 under the name “Pro-Pharmaceuticals, Inc.,” and changed its name to “Galectin Therapeutics, Inc.” on May 26, 2011. The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Pro-Pharmaceuticals Securities Corp., which was incorporated in Delaware on December 23, 2003, and Medi-Pharmaceuticals, Inc., which was incorporated in Nevada on August 17, 2010. All intercompany transactions have been eliminated.

The unaudited condensed consolidated financial statements as reported in this Quarterly Report on Form 10-Q reflect all adjustments which are, in the opinion of management, necessary to present fairly the financial position of the Company as of June 30, 2011 and the results of its operations for the three and six-months ended June 30, 2011 and 2010 and the cumulative period from inception (July 10, 2000) through June 30, 2011 and its cash flows for the six months ended June 30, 2011 and 2010, and for the cumulative period from inception (July 10, 2000) to June 30, 2011. All adjustments made to the interim financial statements include all those of a normal and recurring nature. The Company considers events or transactions that occur after the balance sheet date but before the financial statements are issued to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated through the date these financial statements are available to be issued. The results for interim periods are not necessarily indicative of results which may be expected for any other interim period or for the full year.

The unaudited condensed consolidated financial statements of the Company should be read in conjunction with its Annual Report on Form 10-K for the year ended December 31, 2010.

As shown in the unaudited condensed consolidated financial statements, the Company incurred cumulative net losses applicable to common stockholders of approximately $63.3 million for the cumulative period from inception (July 10, 2000) through June 30, 2011. The Company’s net losses have resulted principally from costs associated with (i) research and development expenses, including clinical trial costs, (ii) general and administrative activities and (iii) the Company’s financing transactions including interest and the costs related to fair value accounting for the Company’s convertible debt instrument and warrant liabilities. As a result of planned expenditures for future research, discovery, development and commercialization activities and potential legal cost to protect its intellectual property, the Company expects to incur additional losses and use additional cash in its operations for the foreseeable future. From inception (July 10, 2000) through June 30, 2011, the Company has raised a net total of approximately $57.1 million in capital through sale and issuance of common stock, common stock warrants, convertible preferred stock, redeemable convertible preferred stock, convertible debt securities in public and private offerings and the exercise of common stock options and warrants. From inception (July 10, 2000) through June 30, 2011, the Company has used approximately $48.3 million of cash in its operations.

At June 30, 2011, the Company had $7,984,000 of unrestricted cash and cash equivalents available to fund future operations. The Company believes that with the funds on hand at June 30, 2011, there is sufficient cash to fund operations through 2012. The Company is actively seeking to raise additional capital. If the Company is unsuccessful in raising additional capital before the end of 2012, the Company may be required to cease operations or seek bankruptcy protection.

The Company is subject to a number of risks similar to those of other development-stage companies, including dependence on key individuals, uncertainty of product development and generation of revenues, dependence on outside sources of capital, risks associated with clinical trials of products, dependence on third-party collaborators for research operations, need for regulatory approval of products, risks associated with protection of intellectual property, and competition with larger, better-capitalized companies. Successful completion of the Company’s development program and, ultimately, the attainment of profitable operations is dependent upon future events, including obtaining adequate financing to fulfill its development activities and achieving a level of revenues adequate to support the Company’s cost structure. There are no assurances that the Company will be able to obtain additional financing on favorable terms, or at all, or successfully market its products.

Agreement with PROCAPS S.A. and Research Grants

132 Months Ended

Jun. 30, 2011

Agreement with PROCAPS S.A. and Research Grants

2.	Agreement with PROCAPS S.A. and Research Grants

Agreement with PROCAPS S.A.

On March 25, 2010, the Company granted PROCAPS S.A. (“PROCAPS”) exclusive rights to market and sell GM-CT-01 (formerly DAVANAT^®) to treat cancer in Colombia, South America. PROCAPS is an international, privately held pharmaceutical company based in Barranquilla, Colombia. Under terms of the agreement, PROCAPS is responsible for obtaining regulatory and pricing approval in Colombia. PROCAPS is responsible for the vial filling, packaging, marketing and distribution of GM-CT-01 in the region.

In October 2010, the Company received a payment of $200,000 and shipped GM-CT-01 to PROCAPS to be used by PROCAPS to qualify its vial filling process and to replicate the Company’s stability study. Should the Company gain approval in Colombia, PROCAPS may then obtain the marketing authorization in other countries in Latin America. The Company recorded the $200,000 payment from PROCAPS as deferred revenue on the condensed consolidated balance sheets as of June 30, 2011 and December 31, 2010 and will recognize the revenue when the remaining deliverables of the collaboration agreement have been completed.

Qualifying Therapeutic Discovery Project

In October 2010, the Company was awarded $489,000 total in two federal grants under the Qualifying Therapeutic Discovery Project (“QTDP”) Program for its GM-CT-01 anti-cancer compound and for its GR/GM-Series of anti-fibrotic, cirrhosis compounds for work performed during 2010 and 2009. The Company recognized this grant in other income in the statement of operations for the year ended December 31, 2010. The Company received $255,000 of the grant in 2010 and the remaining $234,000 was received in 2011 and was included in grants receivable on the consolidated balance sheet at December 31, 2010.

Stock-Based Compensation

132 Months Ended

Jun. 30, 2011

Stock-Based Compensation

3.	Stock-Based Compensation

Following is the stock-based compensation expense related to common stock options, restricted common stock and common stock warrants:


	Three Months Ended June 30,				Six Months Ended June 30,
	2011		2010		2011		2010
		(in thousands)
Research and development	$	614	$	3	$	1,138	$	82
General and administrative		714		571		901		1,089

Total stock-based compensation expense	$	1,328	$	574	$	2,039	$	1,171

Included in stock-based compensation for the six months ended June 30, 2010 was $70,000 of research and development expenses and $295,000 of general and administrative expenses which were accrued for as bonuses as of December 31, 2009 and which were paid with the issuance of options in 2010.

Common Stock Options

The following table summarizes the stock option activity in the Company’s equity incentive plans from December 31, 2010 through June 30, 2011:


	Shares		Weighted Average Exercise Price
Outstanding, December 31, 2010		11,794,250		$ 1.07
Granted		9,841,242		1.17
Exercised		(913,000)		0.20
Options forfeited/cancelled		(1,409,000)		1.08

Outstanding, June 30, 2011		19,313,492		$ 1.16

As of June 30, 2011, there was $8,222,000 of unrecognized compensation related to 8,469,422 unvested options, which is expected to be recognized over a weighted–average period of approximately 3.1 years. The weighted-average grant date fair value for options granted during the three and six months ended June 30, 2011 was $1.04 and $1.02, respectively. The weighted-average grant date fair value for options granted during the six months ended June 30, 2010 was $0.26; there were no options granted during the three months ended June 30, 2010.

Of the options granted during the six months ended June 30, 2011, 1,000,000 vest only upon the achievement of certain market conditions (500,000 and 500,000 upon the Company achieving a market capitalization of $5 billion and $10 billion, respectively). These market condition stock option awards were valued at $1,006,000 using a Monte Carlo model and will be recognized over a weighted average period of 5.5 years. Assumptions used to value these options included the following: annualized volatility of 110%, annualized drift/risk-free interest rate of 3.5% and a forecast horizon life of 10 years.

The fair value of the options granted, other than as noted, is determined using the Black-Scholes option-pricing model. The following weighted average assumptions were used:


	Six Months Ended June 30,		Cumulative Period from Inception (July 10, 2000) to June 30,
	2011	2010	2011
Risk-free interest rate	1.91%	2.38%	2.23%
Expected life of the options	5.1 years	5 years	5.0 years
Expected volatility of the underlying stock	121%	126%	116%
Expected dividend rate	0%	0%	0%

Restricted Stock.

During the year ended December 31, 2009, the Company granted 2,500,000 shares of restricted common stock to members of its Board of Directors. Of the 2,500,000 shares, 2,343,750 were vested as of December 31, 2010 and the remaining 156,250 vested during the six months ended June 30, 2011. The restricted shares were valued at $450,000 ($0.18 per share) at the date of grant, which was recognized over the vesting period.

During the three and six months ended June 30, 2011, the Company issued 125,000 shares of restricted common stock to a consultant. These shares are restricted until November 15, 2011 and any unvested shares are subject to forfeiture upon termination and would revert back to the Company. At June 30, 2011 there were 125,000 restricted shares remaining. The restricted shares were valued at $152,000 ($1.22 per share) at June 30, 2011 and will be adjusted for unvested shares and will be recognized over the vesting period. During the three and six months ended June 30, 2011, the Company recognized $45,000 and $81,000 of stock-based compensation, respectively.

The following table summarizes restricted stock option activity from December 31, 2010 through June 30, 2011:


	Shares
Restricted, December 31, 2010		156,250
Granted		125,000
Vested		(156,250)

Restricted, June 30, 2011		125,000

- Definition

The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 123R

-Paragraph 64, 65, A240

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef

-Publisher AICPA

-Name Statement of Position (SOP)

-Number 93-6

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-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef

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-Name Staff Accounting Bulletin (SAB)

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+ Details

Accrued Expenses

132 Months Ended

Jun. 30, 2011

Accrued Expenses

4.	Accrued Expenses

Accrued expenses consist of the following:


	June 30, 2011		December 31, 2010
	(in thousands)
Legal and accounting fees	$	88	$	94
Accrued compensation		55		87
Severance agreement (Note 9)		-		293
Other		233		63

Total	$	376	$	537

Common Stock Warrants

132 Months Ended

Jun. 30, 2011

Common Stock Warrants

5.	Common Stock Warrants

The following table summarizes the common stock warrant activity from December 31, 2010 through June 30, 2011:


	Shares		Weighted Average Exercise Price
Outstanding, December 31, 2010		51,515,194	$	0.63
Granted		-		0.00
Exercised		(8,198,794)		0.56
Forfeited/cancelled		(527,000)		0.84

Outstanding, June 30, 2011		42,789,400	$	0.64

Consultant Warrants

In April 2009, the Company entered into agreements with consultants that provided for the grant of warrants for 330,000 shares of common stock at an exercise price of $0.50 per share. Of the 330,000 warrants, 200,000 remained unvested as of June 30, 2011. The Company valued the unvested warrants at $167,000 as of June 30, 2011 using the following assumptions: expected life of 1.79 years, volatility of 89%, risk free interest rate of 0.45% and zero dividends. The Company recognized expense related to the 200,000 warrants of $12,000 and $20,000 for the three and six months ended June 30, 2011, respectively. The Company recognized expense of $40,000 and $73,000 for the three and six months ended June 30, 2010.

In May 2010, the Company entered into an agreement with a consultant that provided for the grant of warrants for 72,000 shares of common stock at an exercise price of $2.50 per share. The warrants vest at a rate of 3,000 per month and the unvested warrants will be revalued as they vest. The following assumptions were used to value the warrants for the six months ended June 30, 2011: an expected life of 2.99 to 3.32 years, volatility of 128% to 130%, risk free interest rate of 0.79% to 1.29% and zero dividends. At June 30, 2011, 45,000 warrants were vested and 27,000 were forfeited upon cancellation of the agreement. The company recognized an expense of $5,000 and $12,000 related to these warrants during the three and six months ended June 30, 2011, respectively. The company recognized an expense of $7,000 related to these warrants during the three and six months ended June 30, 2010.

In May 2010, the Company entered into an agreement with a consultant that provided for the grant of warrants for 500,000 shares of common stock at an exercise price of $0.75 per share and which vest upon the achievement of certain milestones. At June 30, 2011, all 500,000 warrants were unvested. The Company did not recognize any expense related to these warrants during the three and six- months ended June 30, 2011 or 2010, as the Company determined that it was not yet probable that the milestones will be achieved. These warrants were cancelled during the three months ended June 30, 2011.

In August 2010, the Company entered into an agreement with a consultant, who was also a board member, which provided for the grant of warrants for 600,000 shares of common stock at an exercise price of $0.71 per share. Of the 600,000 warrants, 150,000 vested immediately on signing of the agreement, 150,000 vest at the end of one year and the remaining 300,000 warrants were to vest based on the achievement of certain milestones. The following assumptions were used to value the remaining unvested warrants on March 7, 2011 at the date the consultant effectively became an employee of the Company: an expected life of 4.28 years, volatility of 135%, risk free interest rate of 1.705% and zero dividends. Pursuant to an employment agreement entered into in May 2011 with the consultant, all remaining unvested warrants were immediately vested. The Company recognized expense of $213,000 and $340,000 related to these warrants during the three and six months ended June 30, 2011, respectively. The Company recognized an expense of $100,000 related to these warrants during the three and six months ended June 30, 2010.

- Definition

The entire disclosure for shareholders' equity, comprised of portions attributable to the parent entity and noncontrolling interest, if any, including other comprehensive income (as applicable). Including, but not limited to: (1) balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings; (2) accumulated balance for each classification of other comprehensive income and total amount of comprehensive income; (3) amount and nature of changes in separate accounts, including the number of shares authorized and outstanding, number of shares issued upon exercise and conversion, and for other comprehensive income, the adjustments for reclassifications to net income; (4) rights and privileges of each class of stock authorized; (5) basis of treasury stock, if other than cost, and amounts paid and accounting treatment for treasury stock purchased significantly in excess of market; (6) dividends paid or payable per share and in the aggregate for each class of stock for each period presented; (7) dividend restrictions and accumulated preferred dividends in arrears (in aggregate and per share amount); (8) retained earnings appropriations or restrictions, such as dividend restrictions; (9) impact of change in accounting principle, initial adoption of new accounting principle and correction of an error in previously issued financial statements; (10) shares held in trust for Employee Stock Ownership Plan (ESOP); (11) deferred compensation related to issuance of capital stock; (12) note received for issuance of stock; (13) unamortized discount on shares; (14) description, terms, and number of warrants or rights outstanding; (15) shares under subscription and subscription receivables, effective date of new retained earnings after quasi-reorganization and deficit eliminated by quasi-reorganization and, for a period of at least ten years after the effective date, the point in time from which the new retained dates; and (16) retroactive effective of subsequent change in capital structure.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 235

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-Paragraph 1

-Subparagraph (SX 210.4-08.(d),(e))

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-Topic 505

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-Paragraph 4

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-Glossary Preferred Stock

-URI http://asc.fasb.org/extlink&oid=6521494

Reference 14: http://www.xbrl.org/2003/role/presentationRef

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Reference 16: http://www.xbrl.org/2003/role/presentationRef

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-Name Regulation S-X (SX)

-Number 210

-Section 04

-Article 3

Reference 17: http://www.xbrl.org/2003/role/presentationRef

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-Name Regulation S-X (SX)

-Number 210

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Reference 19: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 129

-Paragraph 2, 3, 4, 5, 6, 7, 8

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 20: http://www.xbrl.org/2003/role/presentationRef

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-Name Regulation S-X (SX)

-Number 210

-Section 08

-Article 4

Reference 21: http://www.xbrl.org/2003/role/presentationRef

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-Name Statement of Financial Accounting Standard (FAS)

-Number 5

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-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 22: http://www.xbrl.org/2003/role/presentationRef

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-Number 210

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-Paragraph 29, 30, 31

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Reference 23: http://www.xbrl.org/2003/role/presentationRef

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-Name Staff Accounting Bulletin (SAB)

-Number Topic 4

-Section E

+ Details

Fair Value of Financial Instruments

132 Months Ended

Jun. 30, 2011

Fair Value of Financial Instruments

6.	Fair Value of Financial Instruments

In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities. Fair values determined by Level 2 inputs utilize data points that are observable, such as quoted prices, interest rates and yield curves. Fair values determined by Level 3 inputs utilize unobservable data points for the asset or liability. The Company’s financial liabilities were classified as Level 2. These Level 2 liabilities consisted of warrant liabilities at December 31, 2010 and have been valued using the Black-Scholes pricing model. The Company did not have any warrant liabilities at June 30, 2011.

The Company uses the Black-Scholes pricing model to calculate fair value of its warrant liabilities. Key assumptions used to apply these models are as follows:


		December 31, 2010
Risk free interest rate		0.19%
Expected life		0.62 years
Expected volatility of common share price		70%
Common share price		$0.90

Below is a summary of our fair value measurements at December 31, 2010:


	Value at Period End		Quoted prices in active markets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
	(in thousands)
December 31, 2010:
Warrant liabilities	$	861	$	-	$	861	$	-

The Company’s financial instruments consist of cash equivalents, accounts payable and accrued expenses. The estimated fair value of these financial instruments approximates their carrying value due to their short-term nature.

- 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

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 825

-SubTopic 10

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Reference 6: http://www.xbrl.org/2003/role/presentationRef

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-Name Statement of Financial Accounting Standard (FAS)

-Number 107

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Reference 7: http://www.xbrl.org/2003/role/presentationRef

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-Subparagraph a, b

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-Name Statement of Financial Accounting Standard (FAS)

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+ Details

Preferred Stock

132 Months Ended

Jun. 30, 2011

Preferred Stock

7.	Preferred Stock

Series B Convertible Preferred Stock

Through a series of closings from February 2009 through May 2010, the Company issued and sold a total of (i) 900,000 shares of Series B-1 convertible preferred stock (“Series B-1 redeemable convertible preferred stock” or “Series B-1”) and related common stock warrants for 10,800,000 shares of common stock and (ii) 2,100,000 shares of Series B-2 convertible preferred stock (“Series B-2 redeemable convertible preferred stock” or “Series B-2” and together with the Series B-1, the “Series B”) and related warrants for 25,200,000 shares of common stock. During the three and six months ended June 30, 2010, the Company issued 440,000 and 770,000 shares of Series B-2 and related warrants, respectively, for net proceeds of $833,000 and $1,463,000, respectively. Pursuant to an agreement with the holder of all shares of Series B, on January 26, 2011, the Company amended and restated the Certificate of Designation of Preferences, Rights and Limitations for the Series B-1 Convertible Preferred Stock and Series B-2 Convertible Preferred Stock, as previously amended, to (i) delete Section 5(c) (entitled “Mandatory Conversion”) in order to remove the Company’s right to compel conversion of the Series B Preferred Stock to shares of its Common Stock, (ii) amend the definitions in Section 1 (entitled “Definitions”) of the terms “Series B-1 Redemption Date” and the “Series B-2 Redemption Date” in order to extend such redemption dates to be the earlier of February 12, 2019, or the date of a promissory note issued to David Platt, Ph.D. pursuant to a separation agreement between him and the Company, (iii) amend Section 3 (entitled “Dividends”) such that dividends are payable in cash or shares of Common Stock valued at 100% of the volume weighted average price of the Common Stock for the 20 consecutive trading days prior to the dividend payment date on and after September 30, 2011, and (iv) insert new Section 5(d) (entitled “Automatic Conversion Upon Transfer”) to require that any request for transfer of shares of Series B Preferred Stock to another holder shall result in an automatic conversion to shares of Common Stock.

Series C 6% Super Dividend Convertible Preferred Stock

On December 29, 2010, the Company designated and authorized the sale and issuance of up to 1,000 shares of Series C Super Dividend Convertible Preferred Stock (“Series C”) with a par value of $0.01 and a stated value equal to $10,000 (the “Stated Value”).

On December 30, 2010, the Company sold and issued 212 shares of Series C at a price of $10,000 per share for gross proceeds of $2,120,000. The Company incurred $47,000 of cash transaction costs resulting in net cash proceeds of $2,073,000. In addition, the Company issued 3,000 warrants exercisable at $1.20 to a placement agent which had a de minimis value.

During January 2011, the Company sold and issued 13 shares of Series C at a price of $10,000 per share for gross proceeds of $130,000.

The terms of the Series C are as follows:

Conversion Rights. Each holder of Series C may convert all, but not less than all, of his Series C shares plus accrued and unpaid dividends into Common Stock at the price of $1.00 per share of Common Stock (“Conversion Price”), such that 10,000 shares of Common Stock will be issued per each converted share of Series C (accrued and unpaid dividends will be issued as additional shares).

Subject to the continuing obligation to pay post conversion dividends, the Company may convert all, but not less than all, of the Series C (plus all accrued and unpaid dividends) into Common Stock, at the Conversion Price, upon such time that the closing price of the Common Stock is no less than $3.00 per share for 15 consecutive trading days.

Dividends. Holders of Series C shall be entitled to receive cumulative non-compounding dividends at the rate per share of Series C equal to the greater of (i) 6% per annum of the Stated Value (also defined as the “Floor”) or (ii) 2.5% of net sales until the total dividends paid is equal to the initial investment and 1.25% of net sales thereafter. The maximum amount each Series C shareholder will receive in dividend payments is equal to $100,000 (the “Maximum Payout”). For purposes of this dividend calculation, net sales shall mean gross revenues actually received by the Company, from the sale or licensing of the product DAVANAT^®, less chargebacks, returns, expenses attributable to product recalls, duties, customs, sales tax, freight, insurance, shipping expenses, allowances and other customary deductions.

The dividend shall be payable in arrears semi annually on March 31 and September 30, beginning with the first such date after the original issue date; provided, however, that all dividends and all other distributions shall cease, and no further dividends or other distributions shall be paid, in respect of each share of Series C from and after such time that the Maximum Payout has been paid in respect of such share of Series C. Such dividends shall be payable at the Company’s option either in cash or in duly authorized, fully paid and non-assessable shares of Common Stock valued at the higher of (i) $0.50 per share or (ii) the average of the Common Stock trading price for the ten (10) consecutive trading days ending on the trading day that is immediately prior to the dividend payment date.

Series C Post Conversion Dividend Right. In the event that any share of Series C is converted into Common Stock before the Maximum Payout is paid in respect of such converted share of Series C, then the holder shall have the right to continue to receive dividends in respect of such converted share of Series C equal to the remaining payout (the “Series C Preferred Stock Post Conversion Dividend Right”) which shall be equal to the Maximum Payout less the cumulative dividends received through the conversion date. One share of Series C Preferred Stock Post Conversion Dividend Right shall be issued for each such converted share of Series C. The holder of each Series C Preferred Stock Post Conversion Dividend Right shall receive the remaining payout on an equal basis and in conjunction with the then outstanding shares of Series C and all the other then outstanding Series C Post Conversion Dividend Rights, in the same manner and subject to the same terms and conditions as applicable to the payment of dividends on each share of Series C, except that for purposes of calculating the dividend the Floor shall not apply. The Series C Preferred Stock Post Conversion Dividend Right shall have no stated value, liquidation preference or right to any dividends or distributions other than the remaining payout. The Series C Preferred Stock Post Conversion Right is subject to redemption in the same manner as outstanding Series C shares.

At the date of issuance, the Series C have an embedded dividend right to continue to receive dividend payments after conversion to common stock (the Series C Post Conversion Dividend Right) which requires bifurcation. The value of this post conversion dividend right on the date of issuance was determined to be de minimis due to the payment of a dividend stream other than the 6% dividend and conversion of Series C prior to the Company achieving sales of GM-CT-01 was deemed improbable at that time. Upon a conversion of the Series C, the Company will be required to record a liability and the related expense during the period of conversion. The Company will continue to evaluate and assess the Series C Post Conversion Dividend Right for each reporting period.

Liquidation Rights. In the event of any liquidation, dissolution or winding up of the Company, either voluntarily or involuntarily, the holders of Series C will receive $10,000 per share plus accrued and unpaid dividends, payable prior and in preference to any distributions to the holders of Common Stock but after and subordinate to the Series A 12% Convertible Preferred Stock (“Series A”), Series B-1 and Series B-2, subject to the Maximum Payout.

Redemption. Upon a sale of the Company, the Company shall redeem all of the then outstanding shares of Series C and Series C Preferred Stock Post Conversion Rights within thirty (30) days after the transaction constituting the sale of the Company is closed and such closing is fully funded. The price to redeem a share of Series C and each redeemed Series C Preferred Stock Post Conversion Redemption Right shall be equal to (i) (A) the applicable return on investment (“ROI”) percentage, multiplied by (B) $10,000, minus (ii) the cumulative dividends received through the redemption date. The redemption price shall be payable at our option either in cash or in shares of common stock valued at the higher of (i) $0.50 per share or (ii) the average market price for the ten consecutive trading days ending immediately prior to the date of redemption. The ROI Percentage shall mean the percentage that applies as of the redemption date, as follows:


ROI Percentage
200%		before the second anniversary of the date of issuance;
250%		on or after the second anniversary of the date of issuance, but before the third anniversary of the date of issuance;
300%		on or after the third anniversary of the date of issuance, but before the fourth anniversary of the date of issuance;
350%		on or after the fourth anniversary of the date of issuance, but before the fifth anniversary of the date of issuance;
400%		on or after the fifth anniversary of the date of issuance, but before the sixth anniversary of the date of issuance;
450%		on or after the sixth anniversary of the date of issuance, but before the seventh anniversary of the date of issuance;
500%		on or after the seventh anniversary of the date of issuance, but before the eighth anniversary of the date of issuance; and
550%		on or after the eighth anniversary of the date of issuance, but before the ninth anniversary of the date of issuance.

Due to the redemption feature, the Company has presented the Series C outside of permanent equity, in the mezzanine of the consolidated balance sheet at June 30, 2011 and December 31, 2010.

Voting Rights. The Series C shares have no voting rights.

Loss Per Share

132 Months Ended

Jun. 30, 2011

Loss Per Share

8.	Loss Per Share

Basic loss per share is based on the weighted-average number of common shares outstanding during each period. Diluted loss per share is based on basic shares as determined above plus the incremental shares that would be issued upon the assumed exercise of in-the-money stock options and warrants using the treasury stock method. The computation of diluted net loss per share does not assume the issuance of common shares that have an anti-dilutive effect on net loss per share. For the three and six-month periods ended June 30, 2011 and 2010, all stock options, warrants and potential shares related to conversion of the Series A, the Series B and the Series C were excluded from the computation of diluted net loss per share. Dilutive shares which could exist pursuant to the exercise of outstanding stock instruments and which were not included in the calculation because their affect would have been anti-dilutive are as follows:


	June 30, 2011 (Shares)		June 30, 2010 (Shares)

Warrants to purchase shares of common stock		42,789,400		55,178,481
Options to purchase shares of common stock		19,313,492		11,877,250
Restricted shares subject to vesting		125,000		725,000
Shares of common stock issuable upon conversion of preferred stock		15,812,500		13,617,500

		78,040,392		81,398,231

- Definition

The entire disclosure for earnings per share.

+ References+ Details

Commitments and Contingencies

132 Months Ended

Jun. 30, 2011

Commitments and Contingencies

9.	Commitments and Contingencies

Separation Agreement – Former Chief Executive Officer and Chairman of the Board of Directors

In February 2009, the Company entered into a Separation Agreement in connection with the resignation of David Platt, Ph.D., the Company’s former Chief Executive Officer and Chairman of the Board of Directors. The Separation Agreement provides that the Company shall continue to pay Dr. Platt his salary at a monthly rate of $21,667 for 24 months as well as health and dental benefits. The Company recognized the full amount of the salary, health insurance and automobile during the first quarter of 2009. The remaining liability related to this severance was reflected in accrued expenses ($293,000) on the condensed consolidated balance sheet at December 31, 2010 and was paid to Dr. Platt on February 12, 2011.

The Separation Agreement also provides for the deferral of a $1.0 million severance payment due to Dr. Platt under his employment agreement until the occurrence of any of the following milestone events: (i) the approval by the Food and Drug Administration for a new drug application (“NDA”) for any drug candidate or drug delivery candidate based on the GM-CT-01 technology (whether or not such technology is patented), in which case Dr. Platt is also entitled to a fully vested 10-year cashless-exercise stock option to purchase at least 500,000 shares of common stock at an exercise price not less than the fair market value of the common stock determined as of the date of grant; (ii) consummation of a transaction with a pharmaceutical company expected to result in at least $10.0 million of equity investment or $50 million of royalty revenue to the Company, in which case Dr. Platt is also entitled to stock options on the same terms to purchase at least 300,000 shares of common stock; or (iii) the renewed listing of our securities on a national securities exchange. Payment upon the events (i) and (iii) may be deferred up to nine months, and if the Company has insufficient cash at the time of any of such events, it may issue Dr. Platt a secured promissory note for such amount. If the Company file a voluntary or involuntary petition for bankruptcy, whether or not a milestone event has occurred, such event shall trigger our obligation to pay the $1.0 million with the result that Dr. Platt may assert a claim for such obligation against the bankruptcy estate. Due to the uncertainties regarding the achievement of any of the milestones as described, the Company has not accrued for the $1.0 million severance nor has it recognized the value of the unissued stock options as of June 30, 2011. When it is deemed probable that one or more of the milestone events will be achieved, the Company will then recognize the $1.0 million severance and the expense related to the issuance of the stock option at that time based on the then current fair value.

Legal Proceedings

The Company records accruals for such contingencies to the extent that the Company concludes that their occurrence is probable and the related damages are estimable. There has been no material change in the matters reported in our Annual Report on Form 10-K for the year ended December 31, 2010.

From time to time, the Company is exposed to litigation relating to its operations. The Company is not currently engaged in any legal proceedings that are expected, individually or in the aggregate, to have a material, adverse affect on its financial condition or results of operations.

- Definition

The entire disclosure for commitments and contingencies.

+ References

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+ Details

Subsequent Events

132 Months Ended

Jun. 30, 2011

Subsequent Events

10.

Subsequent Events

The Company has evaluated all events or transactions that occurred through the date on which the financial statements were issued, noting the following:

In July 2011, a shareholder converted 5 shares of Series C to 50,000 shares of common stock and was issued a Series C Post Conversion Dividend Right under which the Company will continue to pay dividends until $100,000 for each share of Series C has been paid.

In July 2011, the Company entered into an agreement to amend its operating lease for office space to extend the lease for a period of one year, expiring on September 30, 2012, at a base rent of $235,000 for the term.

In July 2011, the Company entered into an operating lease for an apartment for Company executive use for a one-year term, ending July 2012, at a rate of $41,000 for the term.