1. Nature of business

        Verastem, Inc. (the "Company"), incorporated on August 4, 2010 as a Delaware corporation, is a biopharmaceutical company focused on discovering and developing proprietary small molecule drugs targeting cancer stem cells. The Company's operations to date have been limited to organizing and staffing the Company, business planning, raising capital, acquiring and developing its technology, identifying potential product candidates and undertaking preclinical and clinical studies of its most advanced product candidates.

        The Company is subject to a number of risks similar to other life science companies, including, but not limited to, the need to obtain adequate additional funding, possible failure of preclinical testing or clinical trials, inability to obtain marketing approval of product candidates, competitors developing new technological innovations, market acceptance of the Company's products and protection of proprietary technology. If the Company does not successfully commercialize any of its product candidates, it will be unable to generate product revenue or achieve profitability. As of December 31, 2014, the Company had an accumulated deficit of $141.0 million. The Company expects to continue to incur operating losses in future periods. The Company had cash, cash equivalents and investments of $92.7 million as of December 31, 2014. The Company believes that its existing cash, cash equivalents and investments, including $55.5 million of net proceeds received in January 2015 from the sale of common stock, will be sufficient to fund its current operating plan and capital expenditure requirements for at least the next twelve months.