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STOCK-BASED COMPENSATION (Tables)
12 Months Ended
Dec. 31, 2015
Summary of Stock Option Activity

The following table summarizes activity under the Company’s stock option plans, including the 2012 and 2014 Inducement Plans and those suspended upon the adoption of the 2006 Share Incentive Plan for the year ended December 31, 2015. All option grants presented in the table had exercise prices not less than the fair value of the underlying common stock on the grant date:

 

 

 

Shares

 

 

Weighted

Average

Exercise

Price

 

 

Weighted

Average

Remaining

Years

 

Aggregate

Intrinsic

Value (1)

 

Options outstanding as of December 31, 2014

 

 

11,477,164

 

 

$

38.11

 

 

6.2

 

$

600,112

 

Granted

 

 

728,770

 

 

$

116.94

 

 

 

 

 

 

 

Exercised

 

 

(1,723,345

)

 

$

30.80

 

 

 

 

 

 

 

Expired and forfeited

 

 

(159,686

)

 

$

63.79

 

 

 

 

 

 

 

Options outstanding as of December 31, 2015

 

 

10,322,903

 

 

$

44.50

 

 

5.6

 

$

630,949

 

Options expected to vest at December 31, 2015

 

 

1,563,790

 

 

$

62.18

 

 

 

 

$

66,579

 

Exercisable at December 31, 2015

 

 

8,102,226

 

 

$

35.62

 

 

4.9

 

$

561,554

 

 

 

(1)

The aggregate intrinsic value for outstanding options is calculated as the difference between the exercise price of the underlying awards and the quoted price of the Company’s common stock as of the last trading day for the respective year. The aggregate intrinsic value of options outstanding and exercisable includes options with an exercise price below $104.76, the closing price of the Company’s common stock on December 31, 2015.

 

Stock Option Valuation Assumptions

The assumptions used to estimate the per share fair value of stock options granted under the 2012 Inducement Plan, the 2014 Inducement Plan and the Share Incentive Plan were as follows:

 

 

 

Years Ended December 31,

 

 

 

2015

 

 

2014

 

 

2013

 

Expected volatility

 

36 – 45%

 

 

44 – 45%

 

 

44 – 47%

 

Dividend yield

 

 

0.00%

 

 

 

0.00%

 

 

 

0.00%

 

Expected life

 

6.4 - 8.0 years

 

 

6.9 years

 

 

6.6 – 6.8 years

 

Risk-free interest rate

 

1.5 – 2.2%

 

 

1.8 – 2.3%

 

 

1.0 – 2.4%

 

 

Employee Stock Purchase Plan Valuation Assumptions

The assumptions used to estimate the per share fair value of stock purchase rights granted under the ESPP were as follows:

 

 

Years Ended December 31,

 

 

 

2015

 

 

2014

 

 

2013

 

Expected volatility

 

36 - 38%

 

 

38 - 39%

 

 

 

37%

 

Dividend yield

 

 

0.00%

 

 

 

0.00%

 

 

 

0.00%

 

Expected life

 

6-24 months

 

 

6-24 months

 

 

6-24 months

 

Risk-free interest rate

 

0.1 - 0.8%

 

 

0.1- 0.5%

 

 

0.1- 0.3%

 

 

Multiple Performance Conditions for Vesting of Base RSUs

The following table details the contingent performance awards, which ones were achieved and the number of RSUs earned based on the final TSR multiplier of 124% at December 31, 2015.   

Strategic Performance Goals

 

Percentage of

Base RSUs to

Vest Upon

Achievement

of Goal

 

 

Base Number

of RSUs

Granted

Before TSR

Multiplier

 

 

Performance Goal Attained

 

Number

of RSUs

Earned After

TSR

Multiplier 1.24

 

Product Goals

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Approval of Vimizim in the U.S. or EU prior to

   December 31, 2015

 

 

35

%

 

 

301,000

 

 

Yes

 

 

373,240

 

Approval of pegvaliase (PEG PAL) or any other

   non-Vimizim product in the U.S. or EU prior

   to December 31, 2015

 

 

25

%

 

 

215,000

 

 

No

 

 

 

Financial Goal

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenues of at least $775.0 million in fiscal 2015

 

 

40

%

 

 

344,000

 

 

Yes

 

 

426,560

 

 

 

 

 

 

 

 

860,000

 

 

 

 

 

799,800

 

 

Stock-Based Compensation Expense

Compensation expense included in the Company’s Consolidated Statements of Operations for all stock-based compensation arrangements was as follows:

 

 

 

Years Ended December 31,

 

 

 

2015

 

 

2014

 

 

2013

 

Cost of sales

 

$

6,836

 

 

$

6,076

 

 

$

4,860

 

Research and development

 

 

49,399

 

 

 

33,835

 

 

 

27,763

 

Selling, general and administrative

 

 

55,290

 

 

 

46,499

 

 

 

31,753

 

Total stock-based compensation expense

 

$

111,525

 

 

$

86,410

 

 

$

64,376

 

 

Restricted Stock With Service Based Vesting Conditions  
Summary of Non-Vested Restricted Stock Unit Activity

A summary of non-vested RSU activity under the plan for the year ended December 31, 2015 as follows:

 

 

Shares

 

 

Weighted

Average

Grant Date

Fair Value

 

 

Weighted

Average

Remaining

Years

 

 

Aggregate

Intrinsic

Value

 

Non-vested units as of December 31, 2014

 

 

1,540,703

 

 

$

59.46

 

 

 

2.9

 

 

$

139,280

 

Granted

 

 

1,234,650

 

 

$

119.86

 

 

 

 

 

 

 

 

 

Vested

 

 

(489,301

)

 

$

54.48

 

 

 

 

 

 

 

 

 

Forfeited

 

 

(138,843

)

 

$

81.67

 

 

 

 

 

 

 

 

 

Non-vested units as of December 31, 2015

 

 

2,147,209

 

 

$

93.89

 

 

 

2.8

 

 

$

224,942

 

Non-vested units expected to vest at December 31, 2015

 

 

1,895,918

 

 

$

92.56

 

 

 

 

 

 

$

199,917

 

 

Restricted Stock With Performance and Market Based Vesting Conditions  
Summary of Non-Vested Restricted Stock Unit Activity

A summary of non-vested Base RSU activity under the plans for the year ended December 31, 2015 is as follows:

 

 

 

Base Awards

 

 

Weighted

Average

Grant Date

Fair Value

 

 

Weighted

Average

Remaining

Years

 

 

Aggregate

Intrinsic

Value

 

Non-vested units with performance and market vesting

   conditions as of December 31, 2014

 

 

860,000

 

 

$

34.66

 

 

 

1.2

 

 

$

77,744

 

Granted

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vested

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Forfeited

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-vested units with performance and market vesting

   conditions as of December 31, 2015

 

 

860,000

 

 

$

34.66

 

 

 

0.2

 

 

$

90,094