from our inception until december 31 , 2012 , we have funded our operations primarily through the private and public sales of preferred stock , common stock , convertible notes and warrants to purchase common stock totaling $ 181.5 million ( net of issuance costs of $ 9.9 million ) , including $ 29.7 in net proceeds from our series c financing in august 2012 and $ 78.7 million in net proceeds from our initial public offering in october 2012 , and through the receipt of $ 16.4 million of up-front payments under our collaborative agreements . we have incurred net losses in each year since our inception in 2002. our net losses were approximately $ 15.1 million , $ 12.7 million and $ 43.6 million for the years ended december 31 , 2010 , 2011 and 2012 , respectively . as of december 31 , 2012 , we had an accumulated deficit of approximately $ 118.2 million . substantially all our net losses resulted from costs incurred in connection with our research and development 69 programs and from general and administrative costs associated with our operations , and particularly in 2012 , from the mark-to-market of our liability-classified warrants . we expect to continue to incur significant expenses and increasing operating losses for at least the next several years . we anticipate that our expenses will increase substantially as we : complete the development of our lead product candidate , oca , for the treatment of pbc ; seek to obtain regulatory approvals for oca ; outsource the commercial manufacturing of oca for any indications for which we receive regulatory approval ; contract with third parties for the sales , marketing and distribution of oca for any indications for which we receive regulatory approval ; continue our research and development efforts with our preclinical development compounds , int-767 and int-777 ; maintain , expand and protect our intellectual property portfolio ; add operational , financial and management information systems and personnel , including personnel to support our product development and commercialization efforts ; and operate as a public company . we do not expect to generate revenue from product sales unless and until we successfully complete development and obtain marketing approval for one or more of our product candidates , which we expect will take a number of years and is subject to significant uncertainty . accordingly , we anticipate that we will need to raise additional capital prior to the commercialization of oca or any of our other product candidates . until such time , if ever , as we can generate substantial revenue from product sales , we expect to finance our operating activities through a combination of equity offerings , debt financings , government or other third-party funding , marketing and distribution arrangements and other collaborations , strategic alliances and licensing arrangements . however , we may be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all . our failure to raise capital or enter into such other arrangements as and when needed would have a negative impact on our financial condition and our ability to develop our product candidates . prior to april 2011 , we operated a wholly-owned subsidiary in italy where our bile acid receptor research was primarily conducted . subsequently , until march 15 , 2013 , our italian subsidiary was in the process of voluntary liquidation under italian law . effective march 15 , 2013 , we have decided to remove our italian subsidiary from the liquidation process and it will continue to act as our legal representative for our clinical trials in the european union to satisfy european union regulatory requirements . although our italian subsidiary was undergoing the liquidation process from april 2011 through march 2013 , we have continued our early stage tgr5 research program through our collaboration with les laboratories servier and institut de recherches servier , or collectively servier . financial overview revenue to date , we have not generated any revenue from the sale of products . all our revenue has been derived from our collaborative agreements for the development and commercialization of certain of our product candidates . in march 2011 , we entered into an exclusive licensing agreement with dsp for the development of oca in japan and china . under the terms of the agreement , we received an up-front payment of $ 15.0 million and may be eligible to receive up to approximately $ 300 million in additional payments for development , regulatory and commercial sales milestones for oca in japan and china . in august 2011 , we entered into a collaboration agreement with servier for the discovery , research and development of bile acid-derived agonists , or substances that bind to receptors of cells and trigger responses by those cells , for a dedicated bile acid receptor called tgr5 . under the terms of the agreement , we received an up-front payment from servier of $ 1.4 million . servier may be required to pay us up to an aggregate amount of approximately 70 108 million ( approximately $ 142.7 million as of december 31 , 2012 ) upon the achievement of specified development , regulatory and commercial sale milestones , as well as royalties on sales , based on the successful outcome of the collaboration . for accounting purposes , the up-front payments from both transactions are recorded as deferred revenue and amortized over time . we recognized $ 2.4 million in license revenue for the relevant amortization of the two up-front payments and did not receive any milestone payments during 2012 related to these agreements . as the servier up-front payment has been fully recognized as of the third quarter of 2012 , no further revenue will be recognized in respect of such payments . story_separator_special_tag for the purpose of identifying peer companies , we consider characteristics such as industry , length of trading history , similar vesting terms and in-the-money option status . we plan to continue to use the guideline peer group volatility information until the historical volatility of our common stock is relevant to measure expected volatility for future option grants . the assumed dividend yield is based on our expectation of not paying dividends for the foreseeable future . we determine the average expected life of stock options based on the simplified method in accordance with the securities and exchange commission staff accounting bulletin nos . 107 and 110. we expect to use the simplified method until we have sufficient historical exercise data to provide a reasonable basis upon which to estimate expected term . we determine the risk-free interest rate by reference to implied yields available from u.s. treasury securities with a remaining term equal to the expected life assumed at the date of grant . we estimate forfeitures based on our historical analysis of actual stock option forfeitures . 75 the assumptions used in the black-scholes option-pricing model for the years ended december 31 , 2010 , 2011 and 2012 are set forth below : replace_table_token_5_th we expect the impact of stock compensation to grow in future periods due to the potential increases in the value of our common stock , increased headcount and additional stock option and other equity grants . we are required to estimate the level of forfeitures expected to occur and record compensation expense only for those awards that we ultimately expect will vest . due to the lack of historical forfeiture activity of our plan , we expect to estimate our forfeiture rate based on peer company data with characteristics similar to our company . for 2010 , 2011 and 2012 , we used a forfeiture rate of five percent . there have been an insignificant number of forfeitures through december 31 , 2012. due to the absence of an active market for our common stock prior to our initial public offering in october 2012 , the fair value of our common stock for purposes of determining the exercise price for stock option grants was determined by our board of directors , with the assistance and upon the recommendation of management , in good faith , based on a number of objective and subjective factors consistent with the methodologies outlined in the american institute of certified public accountants practice aid , valuation of privately-held-company equity securities issued as compensation , or the practice aid , including : the prices at which we most recently sold our preferred stock and the rights , preferences and privileges of the preferred stock as compared to those of our common stock , including the liquidation preferences of the preferred stock ; our results of operations , financial position and the status of our research and development efforts , including the status of clinical trials for oca and our specific regulatory status and interactions with regulatory authorities ; the likelihood of achieving a liquidity event for the holders of our common stock and stock options , such as an initial public offering , given prevailing market conditions , or a strategic merger or sale of our company , or an m & a transaction ; the material risks related to our business ; achievement of enterprise milestones , including the results of clinical trials and our entry into or termination of collaboration and license agreements ; the market performance of publicly traded companies in the life sciences and biotechnology sectors , and recently completed mergers and acquisitions of companies comparable to us ; external market conditions affecting the life sciences and biotechnology industry sectors ; and the valuation prepared by an independent third-party consultant performed as of march 31 , 2010 and july 31 , 2012. each valuation methodology included estimates and assumptions that required our judgment . these estimates included assumptions regarding future performance , including the successful completion of clinical trials and the time to completing an initial public offering or sale . significant changes to the key assumptions used in the valuations could have resulted in different fair values of common stock at each valuation date . 76 common stock warrant liability in conjunction with various financing transactions , we issued warrants to purchase shares of our common stock as discussed above under revaluation of warrants. the black-scholes option-pricing model requires the use of subjective assumptions , including but not limited to stock price volatility , the expected life of the warrants , the risk free interest rate and the fair value of the common stock underlying the warrants . the fair value of the underlying common stock is determined as discussed above under  stock-based compensation. significant changes to the key assumptions used in the valuations could have resulted in different fair values of the warrants at each valuation date . we will continue to adjust the fair values of the warrants at each financial reporting period end for any changes in fair value until the earlier of the exercise or expiration of the applicable common stock warrants or until such time that the warrants are no longer determined to be derivative instruments . our warrant liability is expected to fluctuate based on the assumptions used in our valuation model . jobs act on april 5 , 2012 , the jumpstart our business startups act of 2012 , or the jobs act , was enacted . section 107 of the jobs act provides that an emerging growth company can take advantage of the extended transition period provided in section 7 ( a ) ( 2 ) ( b ) of the securities act of 1933 , as amended , or the securities act , for complying with new or revised accounting standards . in other words , an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to

cash flows the following table sets forth the significant sources and uses of cash for the periods set forth below : replace_table_token_8_th operating activities . net cash used in operating activities of $ 13.7 million during the year ended december 31 , 2010 was primarily a result of our $ 15.1 million net loss , offset by the add-back of non-cash expenses of $ 1.7 million for stock-based compensation and $ 480,000 for depreciation and warrant liability revaluation income of $ 672,000. net cash provided by operating activities of $ 2.6 million during the year ended december 31 , 2011 was primarily a result of $ 16.4 million in up-front payments from our licensing and collaboration agreements with dsp and servier , $ 14.6 million of which was classified as deferred revenue as described in note 3 to our financial statements included elsewhere in this annual report on form 10-k. the cash payments from the collaboration agreements and the classification of those payments as deferred revenue led to an overall net increase in operating assets of $ 13.9 million , to which non-cash items of $ 1.9 million for stock-based compensation , $ 410,000 for depreciation and $ 217,000 for a loss on the sale of assets in connection with the potential liquidation of our italian subsidiary were added . these positive additions to cash flow were offset against our $ 12.7 million net loss and an additional $ 1.0 million decrease in assets due to the revaluation of our warrant liabilities .


 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.
     ```cash flows the following table sets forth the significant sources and uses of cash for the periods set forth below : replace_table_token_8_th operating activities . net cash used in operating activities of $ 13.7 million during the year ended december 31 , 2010 was primarily a result of our $ 15.1 million net loss , offset by the add-back of non-cash expenses of $ 1.7 million for stock-based compensation and $ 480,000 for depreciation and warrant liability revaluation income of $ 672,000. net cash provided by operating activities of $ 2.6 million during the year ended december 31 , 2011 was primarily a result of $ 16.4 million in up-front payments from our licensing and collaboration agreements with dsp and servier , $ 14.6 million of which was classified as deferred revenue as described in note 3 to our financial statements included elsewhere in this annual report on form 10-k. the cash payments from the collaboration agreements and the classification of those payments as deferred revenue led to an overall net increase in operating assets of $ 13.9 million , to which non-cash items of $ 1.9 million for stock-based compensation , $ 410,000 for depreciation and $ 217,000 for a loss on the sale of assets in connection with the potential liquidation of our italian subsidiary were added . these positive additions to cash flow were offset against our $ 12.7 million net loss and an additional $ 1.0 million decrease in assets due to the revaluation of our warrant liabilities .
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 Suspicious Activity Report : from our inception until december 31 , 2012 , we have funded our operations primarily through the private and public sales of preferred stock , common stock , convertible notes and warrants to purchase common stock totaling $ 181.5 million ( net of issuance costs of $ 9.9 million ) , including $ 29.7 in net proceeds from our series c financing in august 2012 and $ 78.7 million in net proceeds from our initial public offering in october 2012 , and through the receipt of $ 16.4 million of up-front payments under our collaborative agreements . we have incurred net losses in each year since our inception in 2002. our net losses were approximately $ 15.1 million , $ 12.7 million and $ 43.6 million for the years ended december 31 , 2010 , 2011 and 2012 , respectively . as of december 31 , 2012 , we had an accumulated deficit of approximately $ 118.2 million . substantially all our net losses resulted from costs incurred in connection with our research and development 69 programs and from general and administrative costs associated with our operations , and particularly in 2012 , from the mark-to-market of our liability-classified warrants . we expect to continue to incur significant expenses and increasing operating losses for at least the next several years . we anticipate that our expenses will increase substantially as we : complete the development of our lead product candidate , oca , for the treatment of pbc ; seek to obtain regulatory approvals for oca ; outsource the commercial manufacturing of oca for any indications for which we receive regulatory approval ; contract with third parties for the sales , marketing and distribution of oca for any indications for which we receive regulatory approval ; continue our research and development efforts with our preclinical development compounds , int-767 and int-777 ; maintain , expand and protect our intellectual property portfolio ; add operational , financial and management information systems and personnel , including personnel to support our product development and commercialization efforts ; and operate as a public company . we do not expect to generate revenue from product sales unless and until we successfully complete development and obtain marketing approval for one or more of our product candidates , which we expect will take a number of years and is subject to significant uncertainty . accordingly , we anticipate that we will need to raise additional capital prior to the commercialization of oca or any of our other product candidates . until such time , if ever , as we can generate substantial revenue from product sales , we expect to finance our operating activities through a combination of equity offerings , debt financings , government or other third-party funding , marketing and distribution arrangements and other collaborations , strategic alliances and licensing arrangements . however , we may be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all . our failure to raise capital or enter into such other arrangements as and when needed would have a negative impact on our financial condition and our ability to develop our product candidates . prior to april 2011 , we operated a wholly-owned subsidiary in italy where our bile acid receptor research was primarily conducted . subsequently , until march 15 , 2013 , our italian subsidiary was in the process of voluntary liquidation under italian law . effective march 15 , 2013 , we have decided to remove our italian subsidiary from the liquidation process and it will continue to act as our legal representative for our clinical trials in the european union to satisfy european union regulatory requirements . although our italian subsidiary was undergoing the liquidation process from april 2011 through march 2013 , we have continued our early stage tgr5 research program through our collaboration with les laboratories servier and institut de recherches servier , or collectively servier . financial overview revenue to date , we have not generated any revenue from the sale of products . all our revenue has been derived from our collaborative agreements for the development and commercialization of certain of our product candidates . in march 2011 , we entered into an exclusive licensing agreement with dsp for the development of oca in japan and china . under the terms of the agreement , we received an up-front payment of $ 15.0 million and may be eligible to receive up to approximately $ 300 million in additional payments for development , regulatory and commercial sales milestones for oca in japan and china . in august 2011 , we entered into a collaboration agreement with servier for the discovery , research and development of bile acid-derived agonists , or substances that bind to receptors of cells and trigger responses by those cells , for a dedicated bile acid receptor called tgr5 . under the terms of the agreement , we received an up-front payment from servier of $ 1.4 million . servier may be required to pay us up to an aggregate amount of approximately 70 108 million ( approximately $ 142.7 million as of december 31 , 2012 ) upon the achievement of specified development , regulatory and commercial sale milestones , as well as royalties on sales , based on the successful outcome of the collaboration . for accounting purposes , the up-front payments from both transactions are recorded as deferred revenue and amortized over time . we recognized $ 2.4 million in license revenue for the relevant amortization of the two up-front payments and did not receive any milestone payments during 2012 related to these agreements . as the servier up-front payment has been fully recognized as of the third quarter of 2012 , no further revenue will be recognized in respect of such payments . story_separator_special_tag for the purpose of identifying peer companies , we consider characteristics such as industry , length of trading history , similar vesting terms and in-the-money option status . we plan to continue to use the guideline peer group volatility information until the historical volatility of our common stock is relevant to measure expected volatility for future option grants . the assumed dividend yield is based on our expectation of not paying dividends for the foreseeable future . we determine the average expected life of stock options based on the simplified method in accordance with the securities and exchange commission staff accounting bulletin nos . 107 and 110. we expect to use the simplified method until we have sufficient historical exercise data to provide a reasonable basis upon which to estimate expected term . we determine the risk-free interest rate by reference to implied yields available from u.s. treasury securities with a remaining term equal to the expected life assumed at the date of grant . we estimate forfeitures based on our historical analysis of actual stock option forfeitures . 75 the assumptions used in the black-scholes option-pricing model for the years ended december 31 , 2010 , 2011 and 2012 are set forth below : replace_table_token_5_th we expect the impact of stock compensation to grow in future periods due to the potential increases in the value of our common stock , increased headcount and additional stock option and other equity grants . we are required to estimate the level of forfeitures expected to occur and record compensation expense only for those awards that we ultimately expect will vest . due to the lack of historical forfeiture activity of our plan , we expect to estimate our forfeiture rate based on peer company data with characteristics similar to our company . for 2010 , 2011 and 2012 , we used a forfeiture rate of five percent . there have been an insignificant number of forfeitures through december 31 , 2012. due to the absence of an active market for our common stock prior to our initial public offering in october 2012 , the fair value of our common stock for purposes of determining the exercise price for stock option grants was determined by our board of directors , with the assistance and upon the recommendation of management , in good faith , based on a number of objective and subjective factors consistent with the methodologies outlined in the american institute of certified public accountants practice aid , valuation of privately-held-company equity securities issued as compensation , or the practice aid , including : the prices at which we most recently sold our preferred stock and the rights , preferences and privileges of the preferred stock as compared to those of our common stock , including the liquidation preferences of the preferred stock ; our results of operations , financial position and the status of our research and development efforts , including the status of clinical trials for oca and our specific regulatory status and interactions with regulatory authorities ; the likelihood of achieving a liquidity event for the holders of our common stock and stock options , such as an initial public offering , given prevailing market conditions , or a strategic merger or sale of our company , or an m & a transaction ; the material risks related to our business ; achievement of enterprise milestones , including the results of clinical trials and our entry into or termination of collaboration and license agreements ; the market performance of publicly traded companies in the life sciences and biotechnology sectors , and recently completed mergers and acquisitions of companies comparable to us ; external market conditions affecting the life sciences and biotechnology industry sectors ; and the valuation prepared by an independent third-party consultant performed as of march 31 , 2010 and july 31 , 2012. each valuation methodology included estimates and assumptions that required our judgment . these estimates included assumptions regarding future performance , including the successful completion of clinical trials and the time to completing an initial public offering or sale . significant changes to the key assumptions used in the valuations could have resulted in different fair values of common stock at each valuation date . 76 common stock warrant liability in conjunction with various financing transactions , we issued warrants to purchase shares of our common stock as discussed above under revaluation of warrants. the black-scholes option-pricing model requires the use of subjective assumptions , including but not limited to stock price volatility , the expected life of the warrants , the risk free interest rate and the fair value of the common stock underlying the warrants . the fair value of the underlying common stock is determined as discussed above under  stock-based compensation. significant changes to the key assumptions used in the valuations could have resulted in different fair values of the warrants at each valuation date . we will continue to adjust the fair values of the warrants at each financial reporting period end for any changes in fair value until the earlier of the exercise or expiration of the applicable common stock warrants or until such time that the warrants are no longer determined to be derivative instruments . our warrant liability is expected to fluctuate based on the assumptions used in our valuation model . jobs act on april 5 , 2012 , the jumpstart our business startups act of 2012 , or the jobs act , was enacted . section 107 of the jobs act provides that an emerging growth company can take advantage of the extended transition period provided in section 7 ( a ) ( 2 ) ( b ) of the securities act of 1933 , as amended , or the securities act , for complying with new or revised accounting standards . in other words , an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to

