under the terms of the agreement , we will not receive any future royalties on bristol 's sales of orencia ® made after december 31 , 2013. we expect that the loss of these royalty payments will materially and adversely affect our revenue and operating results . historically , repligen also conducted activities aimed at developing proprietary therapeutic drug candidates , often with a potential of entering into a collaboration with a larger commercial stage pharmaceutical or 24 biotechnology company in respect of these programs . as part of our strategic decision in 2012 to focus our efforts on our core bioprocessing business , we reduced our efforts on our clinical development programs and increased our efforts to find collaboration partners to pursue the development and , if successful , the commercialization of these drug programs . the current status of our therapeutic drug development portfolio is : on december 28 , 2012 , we out-licensed our spinal muscular atrophy program , or sma program , led by rg3039 , a small molecule drug candidate in clinical development for sma , to pfizer inc. , or pfizer . pursuant to the license agreement , pfizer will assume the majority of the costs associated with completing the required clinical trials for this program as well as obtaining u.s. food and drug administration ( fda ) approval of the respective new drug application ( nda ) . under the license agreement , we are obligated to conduct additional activities in support of this program , which include completing the second cohort of the initial phase i trial for rg3039 and supporting the transition of the program to pfizer . we completed this second cohort during the quarter ended march 31 , 2013 and substantially all of our remaining clinical obligations during the quarter ended june 30 , 2013. as of september 30 , 2013 , we had completed all of our obligations under the license agreement . on january 21 , 2014 , we out-licensed our histone deacetylase inhibitor ( hdaci ) portfolio , which includes the friedreich 's ataxia program , to biomarin pharmaceuticals inc. , or biomarin . under the terms of the agreement , repligen received an upfront payment of $ 2 million in january 2014 from biomarin and we have the potential to receive up to $ 160 million in future milestone payments for the development , regulatory approval and commercial sale of portfolio compounds included in the agreement . in addition , repligen is eligible to receive royalties on sales of qualified products developed . our clinical development portfolio also includes rg1068 , a synthetic human hormone developed as a novel imaging agent for the improved detection of pancreatic duct abnormalities in combination with magnetic resonance imaging in patients with pancreatitis and potentially other pancreatic diseases . we submitted an nda to the fda and a marketing authorization application to the european medicines agency in the first quarter of 2012. in the second quarter of 2012 , we received a complete response letter from the fda , indicating the need for additional clinical efficacy and safety trial data . we have also received from the fda the requirements for an additional registration study . we believe this information may be a factor in the decision by third-parties that may wish to pursue a development or commercialization agreement with us for rg1068 . we expect that any additional development activities that we may pursue in the future will be largely supported by sponsors or other third parties . critical accounting policies and estimates while our significant accounting policies are more fully described in the notes to our financial statements , we have identified the policies and estimates below as being critical to our business operations and the understanding of our results of operations . the impact of and any associated risks related to these policies on our business operations are discussed throughout management 's discussion and analysis of financial condition ,  including in the results of operations section , where such policies affect our reported and expected financial results . revenue recognition product sales we generate revenue from the sale of products , licensing transactions and research and development collaborations . our product revenues are from the sale of bioprocessing products to customers in the life science and biopharmaceutical industries . we recognize revenue related to product sales upon delivery of the product to the customer as long as there is persuasive evidence of an arrangement , the sales price is fixed or determinable and collection of the related receivable is reasonably assured . determination of whether these criteria have been met are based on management 's judgments primarily regarding the fixed nature of the fee charged for the product 25 delivered and the collectability of those fees . we have a few longstanding customers who comprise the majority of revenue and have excellent payment histories and therefore we do not require collateral . we have had no significant write-offs of uncollectible invoices in the periods presented . at the time of sale , we also evaluate the need to accrue for warranty and sales returns . the supply agreements we have with our customers and related purchase orders identify the terms and conditions of each sale and the price of the goods ordered . due to the nature of the sales arrangements , inventory produced for sale is tested for quality specifications prior to shipment . since the product is manufactured to order and in compliance with required specifications prior to shipment , the likelihood of sales return , warranty or other issues is largely diminished . sales returns and warranty issues are infrequent and have had nominal impact on our financial statements historically . story_separator_special_tag the date on which certain services commence , the level of services performed on or before a given date , and the cost of such services often require the exercise of judgment . we make these judgments based upon the facts and circumstances known at the date of the financial statements . a change in the estimated cost or volume of services provided could result in additional accrued liabilities . any significant unanticipated changes in such estimates could have a significant impact on our accrued liabilities and reported operating results . there have been no material adjustments to our accrued liabilities in any of the periods presented in the accompanying financial statements . stock-based compensation we use the black-scholes option pricing model to calculate the fair value of share-based awards on the grant date . the expected term of options granted represents the period of time for which the options are expected to be outstanding and is derived from our historical stock option exercise experience and option expiration data . for purposes of estimating the expected term , we have aggregated all individual option awards into one group as we do not expect substantial differences in exercise behavior among our employees . the expected volatility is a measure of the amount by which our stock price is expected to fluctuate during the expected term of options granted . we determined the expected volatility based upon the historical volatility of our common stock over a period commensurate with the option 's expected term . the risk-free interest rate is the implied yield available on u.s. treasury zero-coupon issues with a remaining term equal to the option 's expected term on the grant date . we have never declared or paid any cash dividends on any of our capital stock and do not expect to do so in the foreseeable future . accordingly , we use an expected dividend yield of zero to calculate the grant-date fair value of a stock option . we recognize compensation expense on a straight-line basis over the requisite service period based upon options that are ultimately expected to vest , and accordingly , such compensation expense has been adjusted by an amount of estimated forfeitures . forfeitures represent only the unvested portion of a surrendered option . forfeitures are estimated at the time of grant and revised , if necessary , in subsequent periods if actual forfeitures differ from those estimates . based on an analysis of historical data , we have calculated an 8 % annual forfeiture 30 rate for non-executive level employees , a 3 % annual forfeiture rate for executive level employees , and a 0 % forfeiture rate for non-employee members of the board of directors , which we believe is a reasonable assumption to estimate forfeitures . however , the estimation of forfeitures requires significant judgment and , to the extent actual results or updated estimates differ from our current estimates , such amounts will be recorded as a cumulative adjustment in the period estimates are revised . for the fiscal years ended december 31 , 2013 and 2012 , we recorded stock-based compensation expense of approximately $ 1,060,000 and $ 1,024,000 , respectively . for the nine-month fiscal year ended december 31 , 2011 and the nine-month period ended december 31 , 2010 , we recorded stock-based compensation expense of approximately $ 730,000 and $ 748,000 , respectively , for stock options granted under the second amended and restated 2001 repligen corporation stock plan ( the 2001 plan ) . as of december 31 , 2013 , there was $ 1,908,109 of total unrecognized compensation cost related to unvested share-based awards . this cost is expected to be recognized over a weighted average remaining requisite service period of 3.19 years . we expect 687,293 unvested options to vest over the next five years . income taxes prior to the end of 2012 , our u.s. net operating losses ( nol's ) and the majority of our other deferred tax assets were fully offset by a valuation allowance primarily because we were in a cumulative loss position and did not have sufficient history of income to conclude that it was more likely than not that we would be able to realize the tax benefits of those deferred tax assets . as of december 31 , 2012 we had incurred three-year cumulative pre-tax income and concluded that it was more likely than not that we would generate sufficient taxable income in 2013 based on our 2013 projections to realize the tax benefit of a portion of our deferred tax assets . as such , we reversed $ 3,021,000 of the deferred tax asset valuation allowance in the u.s in the fourth quarter of 2012. the amount was recorded as a benefit for income taxes in the consolidated statement of operations . during the year ended december 31 , 2013 , the company utilized $ 8.9 million of net operating losses . as a result of the fact that we no longer receive royalty payments on bristol 's sales of orencia , as of december 31 , 2013 , we concluded that realization of deferred tax assets beyond december 31 , 2013 is not more likely than not , and as such , as of december 31 , 2013 we maintain a valuation allowance against the majority of our remaining deferred tax assets . results of operations on december 15 , 2011 , we changed our fiscal year end from march 31 to december 31. as a result of this change , we filed a transition report on form 10-k covering the nine-month transition period ending december 31 , 2011 . fiscal 2013 refers to the twelve month period from january 1 , 2013 through december 31 , 2013 . fiscal 2012 refers to the twelve month period from january 1 , 2012 through december 31 , 2012 . fiscal 2011 refers to the nine-month transition period from april 1 , 2011 through

liquidity and capital resources we have financed our operations primarily through sales of equity securities , revenues derived from product sales , and research grants , as well as proceeds and royalties from license arrangements and a litigation settlement . our revenue for the foreseeable future will primarily be limited to our bioprocessing product revenue . given the uncertainties related to pharmaceutical product development , we are currently unable to reliably estimate when , if ever , our therapeutic product candidates will generate revenue and cash flows . at december 31 , 2013 , we had cash and marketable securities of $ 73,842,000 compared to $ 49,970,000 at december 31 , 2012. a deposit for leased office space of $ 200,000 is classified as restricted cash and is not included in cash and marketable securities total for december 31 , 2013 or december 31 , 2012. cash flows replace_table_token_6_th operating activities for fiscal 2013 , our operating activities provided cash of $ 25,930,000 reflecting net income of $ 16,093,000 and non-cash charges totaling $ 7,055,000 including depreciation , amortization , stock-based compensation charges , deferred tax asset valuation allowance changes and the revaluation of contingent consideration . decreases in royalties and other receivables and in prepaid expenses and increases in accrued and long term liabilities provided an additional $ 2,457,000 and $ 2,458,000 of cash .


 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 we have financed our operations primarily through sales of equity securities , revenues derived from product sales , and research grants , as well as proceeds and royalties from license arrangements and a litigation settlement . our revenue for the foreseeable future will primarily be limited to our bioprocessing product revenue . given the uncertainties related to pharmaceutical product development , we are currently unable to reliably estimate when , if ever , our therapeutic product candidates will generate revenue and cash flows . at december 31 , 2013 , we had cash and marketable securities of $ 73,842,000 compared to $ 49,970,000 at december 31 , 2012. a deposit for leased office space of $ 200,000 is classified as restricted cash and is not included in cash and marketable securities total for december 31 , 2013 or december 31 , 2012. cash flows replace_table_token_6_th operating activities for fiscal 2013 , our operating activities provided cash of $ 25,930,000 reflecting net income of $ 16,093,000 and non-cash charges totaling $ 7,055,000 including depreciation , amortization , stock-based compensation charges , deferred tax asset valuation allowance changes and the revaluation of contingent consideration . decreases in royalties and other receivables and in prepaid expenses and increases in accrued and long term liabilities provided an additional $ 2,457,000 and $ 2,458,000 of cash .
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 Suspicious Activity Report : under the terms of the agreement , we will not receive any future royalties on bristol 's sales of orencia ® made after december 31 , 2013. we expect that the loss of these royalty payments will materially and adversely affect our revenue and operating results . historically , repligen also conducted activities aimed at developing proprietary therapeutic drug candidates , often with a potential of entering into a collaboration with a larger commercial stage pharmaceutical or 24 biotechnology company in respect of these programs . as part of our strategic decision in 2012 to focus our efforts on our core bioprocessing business , we reduced our efforts on our clinical development programs and increased our efforts to find collaboration partners to pursue the development and , if successful , the commercialization of these drug programs . the current status of our therapeutic drug development portfolio is : on december 28 , 2012 , we out-licensed our spinal muscular atrophy program , or sma program , led by rg3039 , a small molecule drug candidate in clinical development for sma , to pfizer inc. , or pfizer . pursuant to the license agreement , pfizer will assume the majority of the costs associated with completing the required clinical trials for this program as well as obtaining u.s. food and drug administration ( fda ) approval of the respective new drug application ( nda ) . under the license agreement , we are obligated to conduct additional activities in support of this program , which include completing the second cohort of the initial phase i trial for rg3039 and supporting the transition of the program to pfizer . we completed this second cohort during the quarter ended march 31 , 2013 and substantially all of our remaining clinical obligations during the quarter ended june 30 , 2013. as of september 30 , 2013 , we had completed all of our obligations under the license agreement . on january 21 , 2014 , we out-licensed our histone deacetylase inhibitor ( hdaci ) portfolio , which includes the friedreich 's ataxia program , to biomarin pharmaceuticals inc. , or biomarin . under the terms of the agreement , repligen received an upfront payment of $ 2 million in january 2014 from biomarin and we have the potential to receive up to $ 160 million in future milestone payments for the development , regulatory approval and commercial sale of portfolio compounds included in the agreement . in addition , repligen is eligible to receive royalties on sales of qualified products developed . our clinical development portfolio also includes rg1068 , a synthetic human hormone developed as a novel imaging agent for the improved detection of pancreatic duct abnormalities in combination with magnetic resonance imaging in patients with pancreatitis and potentially other pancreatic diseases . we submitted an nda to the fda and a marketing authorization application to the european medicines agency in the first quarter of 2012. in the second quarter of 2012 , we received a complete response letter from the fda , indicating the need for additional clinical efficacy and safety trial data . we have also received from the fda the requirements for an additional registration study . we believe this information may be a factor in the decision by third-parties that may wish to pursue a development or commercialization agreement with us for rg1068 . we expect that any additional development activities that we may pursue in the future will be largely supported by sponsors or other third parties . critical accounting policies and estimates while our significant accounting policies are more fully described in the notes to our financial statements , we have identified the policies and estimates below as being critical to our business operations and the understanding of our results of operations . the impact of and any associated risks related to these policies on our business operations are discussed throughout management 's discussion and analysis of financial condition ,  including in the results of operations section , where such policies affect our reported and expected financial results . revenue recognition product sales we generate revenue from the sale of products , licensing transactions and research and development collaborations . our product revenues are from the sale of bioprocessing products to customers in the life science and biopharmaceutical industries . we recognize revenue related to product sales upon delivery of the product to the customer as long as there is persuasive evidence of an arrangement , the sales price is fixed or determinable and collection of the related receivable is reasonably assured . determination of whether these criteria have been met are based on management 's judgments primarily regarding the fixed nature of the fee charged for the product 25 delivered and the collectability of those fees . we have a few longstanding customers who comprise the majority of revenue and have excellent payment histories and therefore we do not require collateral . we have had no significant write-offs of uncollectible invoices in the periods presented . at the time of sale , we also evaluate the need to accrue for warranty and sales returns . the supply agreements we have with our customers and related purchase orders identify the terms and conditions of each sale and the price of the goods ordered . due to the nature of the sales arrangements , inventory produced for sale is tested for quality specifications prior to shipment . since the product is manufactured to order and in compliance with required specifications prior to shipment , the likelihood of sales return , warranty or other issues is largely diminished . sales returns and warranty issues are infrequent and have had nominal impact on our financial statements historically . story_separator_special_tag the date on which certain services commence , the level of services performed on or before a given date , and the cost of such services often require the exercise of judgment . we make these judgments based upon the facts and circumstances known at the date of the financial statements . a change in the estimated cost or volume of services provided could result in additional accrued liabilities . any significant unanticipated changes in such estimates could have a significant impact on our accrued liabilities and reported operating results . there have been no material adjustments to our accrued liabilities in any of the periods presented in the accompanying financial statements . stock-based compensation we use the black-scholes option pricing model to calculate the fair value of share-based awards on the grant date . the expected term of options granted represents the period of time for which the options are expected to be outstanding and is derived from our historical stock option exercise experience and option expiration data . for purposes of estimating the expected term , we have aggregated all individual option awards into one group as we do not expect substantial differences in exercise behavior among our employees . the expected volatility is a measure of the amount by which our stock price is expected to fluctuate during the expected term of options granted . we determined the expected volatility based upon the historical volatility of our common stock over a period commensurate with the option 's expected term . the risk-free interest rate is the implied yield available on u.s. treasury zero-coupon issues with a remaining term equal to the option 's expected term on the grant date . we have never declared or paid any cash dividends on any of our capital stock and do not expect to do so in the foreseeable future . accordingly , we use an expected dividend yield of zero to calculate the grant-date fair value of a stock option . we recognize compensation expense on a straight-line basis over the requisite service period based upon options that are ultimately expected to vest , and accordingly , such compensation expense has been adjusted by an amount of estimated forfeitures . forfeitures represent only the unvested portion of a surrendered option . forfeitures are estimated at the time of grant and revised , if necessary , in subsequent periods if actual forfeitures differ from those estimates . based on an analysis of historical data , we have calculated an 8 % annual forfeiture 30 rate for non-executive level employees , a 3 % annual forfeiture rate for executive level employees , and a 0 % forfeiture rate for non-employee members of the board of directors , which we believe is a reasonable assumption to estimate forfeitures . however , the estimation of forfeitures requires significant judgment and , to the extent actual results or updated estimates differ from our current estimates , such amounts will be recorded as a cumulative adjustment in the period estimates are revised . for the fiscal years ended december 31 , 2013 and 2012 , we recorded stock-based compensation expense of approximately $ 1,060,000 and $ 1,024,000 , respectively . for the nine-month fiscal year ended december 31 , 2011 and the nine-month period ended december 31 , 2010 , we recorded stock-based compensation expense of approximately $ 730,000 and $ 748,000 , respectively , for stock options granted under the second amended and restated 2001 repligen corporation stock plan ( the 2001 plan ) . as of december 31 , 2013 , there was $ 1,908,109 of total unrecognized compensation cost related to unvested share-based awards . this cost is expected to be recognized over a weighted average remaining requisite service period of 3.19 years . we expect 687,293 unvested options to vest over the next five years . income taxes prior to the end of 2012 , our u.s. net operating losses ( nol's ) and the majority of our other deferred tax assets were fully offset by a valuation allowance primarily because we were in a cumulative loss position and did not have sufficient history of income to conclude that it was more likely than not that we would be able to realize the tax benefits of those deferred tax assets . as of december 31 , 2012 we had incurred three-year cumulative pre-tax income and concluded that it was more likely than not that we would generate sufficient taxable income in 2013 based on our 2013 projections to realize the tax benefit of a portion of our deferred tax assets . as such , we reversed $ 3,021,000 of the deferred tax asset valuation allowance in the u.s in the fourth quarter of 2012. the amount was recorded as a benefit for income taxes in the consolidated statement of operations . during the year ended december 31 , 2013 , the company utilized $ 8.9 million of net operating losses . as a result of the fact that we no longer receive royalty payments on bristol 's sales of orencia , as of december 31 , 2013 , we concluded that realization of deferred tax assets beyond december 31 , 2013 is not more likely than not , and as such , as of december 31 , 2013 we maintain a valuation allowance against the majority of our remaining deferred tax assets . results of operations on december 15 , 2011 , we changed our fiscal year end from march 31 to december 31. as a result of this change , we filed a transition report on form 10-k covering the nine-month transition period ending december 31 , 2011 . fiscal 2013 refers to the twelve month period from january 1 , 2013 through december 31 , 2013 . fiscal 2012 refers to the twelve month period from january 1 , 2012 through december 31 , 2012 . fiscal 2011 refers to the nine-month transition period from april 1 , 2011 through

