except as required by applicable law , we do not intend to update or revise forward-looking statements contained in this annual report on form 10-k to reflect future events or circumstances . overview we are a biotechnology company focused on the discovery and development of lipidomic-based therapeutic antibodies , an emerging field of medical science that targets bioactive signaling lipids to treat a wide range of human diseases . we have two product candidates that are currently in clinical development , and one in pre-clinical evaluation . isonep is the ocular formulation of sonepcizumab , a humanized monoclonal antibody ( mab ) against sphingosine-1-phosphate ( s1p ) . sphingomab is the original mouse version of this monoclonal antibody . isonep is administered by intravitreal injection , and has demonstrated multiple mechanisms of action in ocular models of disease , including anti-angiogenesis , anti-inflammatory , anti-fibrotic and anti-vascular permeability . this combination of mechanisms would suggest : ( i ) isonep might have a comparative advantage over currently marketed products for wet age-related macular degeneration ( wet amd ) and ( ii ) isonep might demonstrate clinical efficacy in a broad range of retinal diseases where there is currently a significant unmet medical need , including diabetic retinopathy , dry amd , and glaucoma-related surgery . in december 2010 , we entered into an agreement with pfizer inc. ( the pfizer agreement ) , which provides pfizer with an exclusive option for a worldwide license to develop and commercialize isonep . under the original terms of the pfizer agreement , pfizer and the company planned to conduct two studies , including a phase 1b study in wet amd patients with pigment epithelial detachment ( ped ) , a complication of wet amd ( the pedigree trial `` ) , and a larger phase 2a study in wet amd patients generally ( the nexus trial `` ) . the company began enrolling patients in the pedigree and nexus trials in september 2011 and october 2011 , respectively . the food and drug administration ( fda ) placed the pedigree and nexus trials on clinical hold in january 2012 following a determination by the fda that the fill-and-finish contractor that had filled the isonep clinical trial vials was not in compliance with the fda 's current good manufacturing practice ( cgmp `` ) standards during the time period it provided those services to the company . thereafter , we manufactured new isonep drug substance with an alternate fill-and-finish contractor and resumed dosing patients in the nexus trial in september 2012. as a result of the clinical hold and the requirement to manufacture new drug substance , the projected costs to complete the isonep trials increased significantly and pfizer requested the company to consider potential alternatives to reduce the increased costs of the isonep trials . in december 2012 , lpath and pfizer amended the pfizer agreement to among other things , reflect the parties ' agreement to discontinue the pedigree trial and to focus on the nexus trial . the parties agreed to continue to pursue and share the cost of the isonep trials , including any costs associated with discontinuing the pedigree trial . in october 2013 , lpath announced that it had received notice from pfizer that pfizer would be seeking to divest certain ophthalmology research and development assets , including pfizer 's rights and obligations under the pfizer agreement . lpath presented offers to pfizer to reacquire those rights . however , in december 2013 , pfizer informed lpath that its offers were not competitive with other offers . therefore , lpath believes that a number of third parties may have an interest in acquiring pfizer 's rights . acquisition of pfizer 's rights and obligations under the terms of the pfizer agreement by a third party would not affect the terms of the pfizer agreement , as the existing rights and obligations currently held by pfizer will be assumed by to the third party or remain with pfizer based on the terms of the agreement between pfizer and the third party . as of december 31 , 2013 , pfizer had paid the company $ 20.0 million pursuant to the terms of the pfizer agreement , including the $ 14 million upfront payment . the amendment to the pfizer agreement did not modify the company 's obligation to fund $ 6.0 million of nexus trial expenses , which it completed during 2013. the terms of the pfizer agreement specify that , since the company has fulfilled its funding obligation , pfizer ( or any third party who acquires pfizer 's rights ) will fund the remaining expenses necessary to complete the nexus trial . 30 as of march 14 , 2014 , 135 patients have been enrolled in the nexus trial , with 25 additional patients required to complete enrollment . we expect to complete dosing the last nexus trial patient during the second half of 2014. the actual time required to complete our clinical trials will depend upon a number of factors outside of our direct control , including those discussed in risk factors  we may have delays in completing our clinical trials , and we may not complete them at all. following completion of the nexus study , pfizer ( or a third party who may acquire pfizer 's rights ) has the right to exercise its option for worldwide rights to isonep for an undisclosed option fee and , if pfizer ( or a third party who may acquire pfizer 's rights ) exercises its option , we will be eligible to receive development , regulatory , and commercial milestone payments that could total up to $ 497.5 million . story_separator_special_tag in some years , such as 2010 and 2011 , the california state government has suspended the use of existing california nol carryforwards . in those years companies have not been permitted to utilize nol carryforwards to reduce the amount of taxes payable to the state . if that fiscal policy were to continue then the california benefits could be deferred , modified , or lost . as of december 31 , 2013 , we also had federal and california research and development tax credit carryforwards of $ 1.2 million and $ 0.6 million , respectively . these tax credits may be available to offset future taxes . the federal credits begin expiring in 2014 , and the state credits do not expire . a valuation allowance has been established to reserve the potential benefits of these carryforwards in our consolidated financial statements to reflect the uncertainty of future taxable income required to utilize available tax loss carryforwards and other deferred tax assets . under the provisions of section 382 of the internal revenue code , substantial changes in our ownership may limit the amount of net operating loss carryforwards that we can utilize annually in the future to offset taxable income . if a change in our ownership is deemed to have occurred or occurs in the future , our ability to use our net operating loss and tax credit carryforwards in any fiscal year may be significantly limited . 34 fair value of warrant liability we measure fair value in accordance with the applicable accounting standards in the financial accounting standards board ( fasb ) codification . fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability . as a basis for considering such assumptions , there exists a three-tier fair value hierarchy , which prioritizes the inputs used in measuring fair value as follows : · level 1unadjusted quoted prices in active markets for identical assets or liabilities that we have the ability to access as of the measurement date . · level 2inputs other than quoted prices included within level 1 that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data . · level 3unobservable inputs for the asset or liability only used when there is little , if any , market activity for the asset or liability at the measurement date . this hierarchy requires us to use observable market data , when available , and to minimize the use of unobservable inputs when determining fair value . we determined the fair value of the warrants using a black-scholes . the model considered amounts and timing of future possible equity and warrant issuances and historical volatility of our stock price . results of operations comparison of years ended december 31 , 2013 and 2012 grant and royalty revenue . grant and royalty revenue for 2013 increased to $ 1.5 million from $ 1.0 million in 2012. the increase of $ 0.5 million is principally due to the january 2012 suspension of the isonep clinical trials . the clinical trials were resumed in september 2012. the suspension resulted in reduced reimbursable costs for outside services in 2012 compared to 2013. research and development revenue under collaborative agreements . as described in note 2 to the consolidated financial statements , in december 2010 we entered into an agreement with pfizer , inc. , which agreement was amended in 2012 , that provides financial support for our isonep and asonep development programs . we recognized revenues as follows : replace_table_token_2_th the increase in revenue in 2013 is attributable principally to the suspension of the isonep clinical trials from january to september 2012. reduced expenditures during that time period resulted in lower amortization of deferred revenues . research and development expenses . research and development expenses for 2013 totaled $ 11.3 million compared to $ 8.2 million for 2012 , an increase of $ 3.1 million . in january 2012 , we temporarily suspended dosing patients in our isonep clinical trials . the increase in research and development costs in 2013 is due principally to the resumption of the clinical trials in september 2012. general and administrative expenses . general and administrative expenses were $ 4.2 million for the year ended december 31 , 2013 compared to $ 4.1 million for 2012 , an increase of $ 0.1 million . the increase in 2013 is principally to increases in legal and investor relations expenses . change in fair value of warrants . various factors are considered in the black-scholes model we use to value outstanding warrants , including our current stock price , the remaining life of the warrants , the volatility of our stock price , and the risk-free interest rate . future changes in these factors will have a significant impact on the computed fair value of the warrant liability . the most significant factor in the valuation model is our stock price . our stock has been thinly traded and relatively small transactions can impact our quoted stock price significantly . as a result , our stock price volatility factor is approximately 44 % . as such , we expect future changes in the fair value of the warrants to continue to vary significantly from quarter to quarter . we caution that the change in fair value of the warrants should not be given undue importance when considering our financial condition and our results of operations . we do not believe that these adjustments , which are required by current generally accepted accounting principles , reflect economic activities or financial obligations undertaken by us . 35 story_separator_special_tag p style= `` margin:0in 0in .0001pt ; text-indent : .5in ; `` > further , our expenses may exceed our current plans and expectations . for example , we believe we have adequate supplies of clinical material to complete the phase 2 clinical trial for isonep ,

liquidity and capital resources since inception , our operations have been financed primarily through the sale of equity and debt securities and funds received from corporate partners pursuant to research and development collaboration agreements . from inception through december 31 , 2013 , we had received net proceeds of approximately $ 61.3 million from the sale of equity securities and the issuance of convertible promissory notes . in addition , we had received a total of $ 37.7 million from corporate partners . we received a total of $ 20.0 million in funding from our research and development arrangement with pfizer during the years ended december 31 , 2011 through 2013. at december 31 , 2013 , we had cash and cash equivalents totaling $ 11.9 million . cash and cash equivalents consist of cash in demand deposit accounts , money market accounts that hold only u.s treasury securities , and federally insured certificates of deposits . net cash used in investing activities during year ended december 31 , 2013 was $ 391,000 , including $ 45,000 invested in equipment and leasehold improvements and $ 346,000 invested in the prosecution of patents . during 2012 , net cash used in investing activities totaled $ 344,000 , including $ 155,000 invested in equipment and leasehold improvements and $ 189,000 invested in the prosecution of patents . net cash provided by financing activities totaled $ 771,000 , including $ 803,000 from the sale of common stock . on august 15 , 2013 , lpath entered into an at-the-market issuance sales agreement , ( the sales agreement ) with mlv & co. llc ( mlv ) and jmp securities llc ( jmp together with mlv , the sales agents ) , pursuant to which the company may issue and sell shares of its common stock having an aggregate offering price of up to $ 20 million from time to time , at the company 's option , through the sales agents .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```liquidity and capital resources since inception , our operations have been financed primarily through the sale of equity and debt securities and funds received from corporate partners pursuant to research and development collaboration agreements . from inception through december 31 , 2013 , we had received net proceeds of approximately $ 61.3 million from the sale of equity securities and the issuance of convertible promissory notes . in addition , we had received a total of $ 37.7 million from corporate partners . we received a total of $ 20.0 million in funding from our research and development arrangement with pfizer during the years ended december 31 , 2011 through 2013. at december 31 , 2013 , we had cash and cash equivalents totaling $ 11.9 million . cash and cash equivalents consist of cash in demand deposit accounts , money market accounts that hold only u.s treasury securities , and federally insured certificates of deposits . net cash used in investing activities during year ended december 31 , 2013 was $ 391,000 , including $ 45,000 invested in equipment and leasehold improvements and $ 346,000 invested in the prosecution of patents . during 2012 , net cash used in investing activities totaled $ 344,000 , including $ 155,000 invested in equipment and leasehold improvements and $ 189,000 invested in the prosecution of patents . net cash provided by financing activities totaled $ 771,000 , including $ 803,000 from the sale of common stock . on august 15 , 2013 , lpath entered into an at-the-market issuance sales agreement , ( the sales agreement ) with mlv & co. llc ( mlv ) and jmp securities llc ( jmp together with mlv , the sales agents ) , pursuant to which the company may issue and sell shares of its common stock having an aggregate offering price of up to $ 20 million from time to time , at the company 's option , through the sales agents .
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 Suspicious Activity Report : except as required by applicable law , we do not intend to update or revise forward-looking statements contained in this annual report on form 10-k to reflect future events or circumstances . overview we are a biotechnology company focused on the discovery and development of lipidomic-based therapeutic antibodies , an emerging field of medical science that targets bioactive signaling lipids to treat a wide range of human diseases . we have two product candidates that are currently in clinical development , and one in pre-clinical evaluation . isonep is the ocular formulation of sonepcizumab , a humanized monoclonal antibody ( mab ) against sphingosine-1-phosphate ( s1p ) . sphingomab is the original mouse version of this monoclonal antibody . isonep is administered by intravitreal injection , and has demonstrated multiple mechanisms of action in ocular models of disease , including anti-angiogenesis , anti-inflammatory , anti-fibrotic and anti-vascular permeability . this combination of mechanisms would suggest : ( i ) isonep might have a comparative advantage over currently marketed products for wet age-related macular degeneration ( wet amd ) and ( ii ) isonep might demonstrate clinical efficacy in a broad range of retinal diseases where there is currently a significant unmet medical need , including diabetic retinopathy , dry amd , and glaucoma-related surgery . in december 2010 , we entered into an agreement with pfizer inc. ( the pfizer agreement ) , which provides pfizer with an exclusive option for a worldwide license to develop and commercialize isonep . under the original terms of the pfizer agreement , pfizer and the company planned to conduct two studies , including a phase 1b study in wet amd patients with pigment epithelial detachment ( ped ) , a complication of wet amd ( the pedigree trial `` ) , and a larger phase 2a study in wet amd patients generally ( the nexus trial `` ) . the company began enrolling patients in the pedigree and nexus trials in september 2011 and october 2011 , respectively . the food and drug administration ( fda ) placed the pedigree and nexus trials on clinical hold in january 2012 following a determination by the fda that the fill-and-finish contractor that had filled the isonep clinical trial vials was not in compliance with the fda 's current good manufacturing practice ( cgmp `` ) standards during the time period it provided those services to the company . thereafter , we manufactured new isonep drug substance with an alternate fill-and-finish contractor and resumed dosing patients in the nexus trial in september 2012. as a result of the clinical hold and the requirement to manufacture new drug substance , the projected costs to complete the isonep trials increased significantly and pfizer requested the company to consider potential alternatives to reduce the increased costs of the isonep trials . in december 2012 , lpath and pfizer amended the pfizer agreement to among other things , reflect the parties ' agreement to discontinue the pedigree trial and to focus on the nexus trial . the parties agreed to continue to pursue and share the cost of the isonep trials , including any costs associated with discontinuing the pedigree trial . in october 2013 , lpath announced that it had received notice from pfizer that pfizer would be seeking to divest certain ophthalmology research and development assets , including pfizer 's rights and obligations under the pfizer agreement . lpath presented offers to pfizer to reacquire those rights . however , in december 2013 , pfizer informed lpath that its offers were not competitive with other offers . therefore , lpath believes that a number of third parties may have an interest in acquiring pfizer 's rights . acquisition of pfizer 's rights and obligations under the terms of the pfizer agreement by a third party would not affect the terms of the pfizer agreement , as the existing rights and obligations currently held by pfizer will be assumed by to the third party or remain with pfizer based on the terms of the agreement between pfizer and the third party . as of december 31 , 2013 , pfizer had paid the company $ 20.0 million pursuant to the terms of the pfizer agreement , including the $ 14 million upfront payment . the amendment to the pfizer agreement did not modify the company 's obligation to fund $ 6.0 million of nexus trial expenses , which it completed during 2013. the terms of the pfizer agreement specify that , since the company has fulfilled its funding obligation , pfizer ( or any third party who acquires pfizer 's rights ) will fund the remaining expenses necessary to complete the nexus trial . 30 as of march 14 , 2014 , 135 patients have been enrolled in the nexus trial , with 25 additional patients required to complete enrollment . we expect to complete dosing the last nexus trial patient during the second half of 2014. the actual time required to complete our clinical trials will depend upon a number of factors outside of our direct control , including those discussed in risk factors  we may have delays in completing our clinical trials , and we may not complete them at all. following completion of the nexus study , pfizer ( or a third party who may acquire pfizer 's rights ) has the right to exercise its option for worldwide rights to isonep for an undisclosed option fee and , if pfizer ( or a third party who may acquire pfizer 's rights ) exercises its option , we will be eligible to receive development , regulatory , and commercial milestone payments that could total up to $ 497.5 million . story_separator_special_tag in some years , such as 2010 and 2011 , the california state government has suspended the use of existing california nol carryforwards . in those years companies have not been permitted to utilize nol carryforwards to reduce the amount of taxes payable to the state . if that fiscal policy were to continue then the california benefits could be deferred , modified , or lost . as of december 31 , 2013 , we also had federal and california research and development tax credit carryforwards of $ 1.2 million and $ 0.6 million , respectively . these tax credits may be available to offset future taxes . the federal credits begin expiring in 2014 , and the state credits do not expire . a valuation allowance has been established to reserve the potential benefits of these carryforwards in our consolidated financial statements to reflect the uncertainty of future taxable income required to utilize available tax loss carryforwards and other deferred tax assets . under the provisions of section 382 of the internal revenue code , substantial changes in our ownership may limit the amount of net operating loss carryforwards that we can utilize annually in the future to offset taxable income . if a change in our ownership is deemed to have occurred or occurs in the future , our ability to use our net operating loss and tax credit carryforwards in any fiscal year may be significantly limited . 34 fair value of warrant liability we measure fair value in accordance with the applicable accounting standards in the financial accounting standards board ( fasb ) codification . fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability . as a basis for considering such assumptions , there exists a three-tier fair value hierarchy , which prioritizes the inputs used in measuring fair value as follows : · level 1unadjusted quoted prices in active markets for identical assets or liabilities that we have the ability to access as of the measurement date . · level 2inputs other than quoted prices included within level 1 that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data . · level 3unobservable inputs for the asset or liability only used when there is little , if any , market activity for the asset or liability at the measurement date . this hierarchy requires us to use observable market data , when available , and to minimize the use of unobservable inputs when determining fair value . we determined the fair value of the warrants using a black-scholes . the model considered amounts and timing of future possible equity and warrant issuances and historical volatility of our stock price . results of operations comparison of years ended december 31 , 2013 and 2012 grant and royalty revenue . grant and royalty revenue for 2013 increased to $ 1.5 million from $ 1.0 million in 2012. the increase of $ 0.5 million is principally due to the january 2012 suspension of the isonep clinical trials . the clinical trials were resumed in september 2012. the suspension resulted in reduced reimbursable costs for outside services in 2012 compared to 2013. research and development revenue under collaborative agreements . as described in note 2 to the consolidated financial statements , in december 2010 we entered into an agreement with pfizer , inc. , which agreement was amended in 2012 , that provides financial support for our isonep and asonep development programs . we recognized revenues as follows : replace_table_token_2_th the increase in revenue in 2013 is attributable principally to the suspension of the isonep clinical trials from january to september 2012. reduced expenditures during that time period resulted in lower amortization of deferred revenues . research and development expenses . research and development expenses for 2013 totaled $ 11.3 million compared to $ 8.2 million for 2012 , an increase of $ 3.1 million . in january 2012 , we temporarily suspended dosing patients in our isonep clinical trials . the increase in research and development costs in 2013 is due principally to the resumption of the clinical trials in september 2012. general and administrative expenses . general and administrative expenses were $ 4.2 million for the year ended december 31 , 2013 compared to $ 4.1 million for 2012 , an increase of $ 0.1 million . the increase in 2013 is principally to increases in legal and investor relations expenses . change in fair value of warrants . various factors are considered in the black-scholes model we use to value outstanding warrants , including our current stock price , the remaining life of the warrants , the volatility of our stock price , and the risk-free interest rate . future changes in these factors will have a significant impact on the computed fair value of the warrant liability . the most significant factor in the valuation model is our stock price . our stock has been thinly traded and relatively small transactions can impact our quoted stock price significantly . as a result , our stock price volatility factor is approximately 44 % . as such , we expect future changes in the fair value of the warrants to continue to vary significantly from quarter to quarter . we caution that the change in fair value of the warrants should not be given undue importance when considering our financial condition and our results of operations . we do not believe that these adjustments , which are required by current generally accepted accounting principles , reflect economic activities or financial obligations undertaken by us . 35 story_separator_special_tag p style= `` margin:0in 0in .0001pt ; text-indent : .5in ; `` > further , our expenses may exceed our current plans and expectations . for example , we believe we have adequate supplies of clinical material to complete the phase 2 clinical trial for isonep ,

