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Stock-Based Compensation (Tables)
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12 Months Ended |
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Dec. 31, 2014
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| Disclosure of Compensation Related Costs, Share-based Payments [Abstract] |
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| Schedule of Weighted Average Assumptions For Employee Stock Option Grants |
Compensation cost for stock options granted to employees and directors is based on the grant-date fair value and is recognized over the vesting period of the applicable option on a straight-line basis. Stock-based compensation expense is based on options ultimately expected to vest, and therefore has been reduced for estimated forfeitures. We estimate forfeitures based on our historical experience; separate groups of employees that have similar historical forfeiture behavior are considered separately for expense recognition. The fair value of each option grant to employees and directors is estimated on the date of grant using the Black-Scholes option-pricing model. The following assumptions were applied to employee & director stock option grants during the periods ended: | | | | | | | | | | | | | | Year Ended December 31, | | 2014 | | 2013 | | 2012 | Estimated weighted-average fair value | $ | 7.39 |
| | $ | 6.87 |
| | $ | 7.35 |
| Weighted-average assumptions: | | | | | | Expected volatility | 73 | % | | 88 | % | | 86 | % | Expected term, in years | 5.8 |
| | 5.8 |
| | 5.7 |
| Risk-free interest rate | 1.87 | % | | 1.66 | % | | 0.95 | % | Expected dividend yield | — | % | | — | % | | — | % |
| | (A) | Expected Volatility. Historically the expected volatility rate used to value stock option grants was based on volatilities of a peer group of similar companies whose share prices were publicly available due to our limited trading history. The peer group was developed based on companies in the pharmaceutical and biotechnology industry in a similar stage of development. As of October 2014, we believe it is appropriate to rely 100% on our own historical realized volatility given our own trading history is roughly equivalent to the average expected term of our options and we do not anticipate future volatility will differ significantly from the past. This change in estimate did not have a material impact on our operating income, net income or earnings per share. |
| | (B) | Expected Term. We elected to utilize the “simplified” method for “plain vanilla” options to determine the expected term of our stock option grants. We will continue to use the simplified method until we have sufficient historical data necessary to provide a reasonable estimate of expected life based on the exercise behavior of our option holders. Under this approach, the weighted-average expected life is presumed to be the average of the vesting term and the contractual term of the option. |
| | (C) | Risk-free Interest Rate. The risk-free interest rate assumption was based on zero-coupon U.S. Treasury instruments that had terms consistent with the expected term of our stock option grants. |
| | (D) | Expected Dividend Yield. We have never declared or paid any cash dividends and do not presently plan to pay cash dividends in the foreseeable future. |
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| Stock-Based Compensation Expense |
Stock-based compensation expense includes amortization of stock options granted to employees and non-employees and has been reported in our Consolidated Statements of Operations and Comprehensive Loss as follows:
| | | | | | | | | | | | | | Year Ended December 31, | | 2014 | | 2013 | | 2012 | | (In thousands) | Research and development | $ | 4,754 |
| | $ | 3,588 |
| | $ | 2,191 |
| Selling, general and administrative | 4,164 |
| | 2,664 |
| | 2,090 |
| Total stock-based compensation expense | $ | 8,918 |
| | $ | 6,252 |
| | $ | 4,281 |
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In connection with the non-employee options, we recognized expense of $289,000, $71,000 and $64,000 during the years ended December 31, 2014, 2013 and 2012, respectively. |
| Stock Option Activity and Related Information |
Stock option activity for all stock plans and related information is as follows: | | | | | | | | | | | | | | | Options Outstanding | | Weighted- Average Exercise Price per Share | | Remaining Contractual Life (in years) | | Aggregate Intrinsic Value (In thousands) | Balance at December 31, 2013 | 6,969,303 |
| | $ | 6.38 |
| | | | | Granted | 2,005,850 |
| | 11.72 |
| | | | | Exercised | (297,303 | ) | | 6.06 |
| | | | | Forfeited and expired | (313,381 | ) | | 10.30 |
| | | | | Balance at December 31, 2014 | 8,364,469 |
| | $ | 7.52 |
| | 6.99 | | $ | 144,348 |
| Vested and expected to vest at December 31, 2014 | 8,047,969 |
| | $ | 7.40 |
| | 6.91 | | $ | 139,877 |
| Exercisable at December 31, 2014 | 5,166,081 |
| | $ | 5.63 |
| | 5.69 | | $ | 98,949 |
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| Stock Options Outstanding and Exercisable |
Information about stock options outstanding and exercisable is as follows: | | | | | | | | | | | | | | | | | | | | December 31, 2014 | | | Options Outstanding | | Options Exercisable | Range of Exercise Price | | Number of Options | | Weighted- Average Remaining Contractual Life (Years) | | Weighted- Average Exercise Price | | Number of Options | | Weighted- Average Exercise Price | $0.98 - $4.09 | | 1,565,934 |
| | 2.09 | | $ | 1.19 |
| | 1,564,898 |
| | $ | 1.19 |
| $4.10 - $8.00 | | 2,063,380 |
| | 6.37 | | 5.31 |
| | 1,897,969 |
| | 5.29 |
| $8.01- $11.42 | | 2,839,321 |
| | 8.27 | | 9.80 |
| | 1,425,343 |
| | 9.78 |
| $11.43 - $21.49 | | 1,895,834 |
| | 9.79 | | 11.76 |
| | 277,871 |
| | 11.61 |
| $0.98 - $21.49 | | 8,364,469 |
| | 6.99 | | $ | 7.52 |
| | 5,166,081 |
| | $ | 5.63 |
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