Stock Compensation

3 Months Ended

Mar. 31, 2024

Share-Based Payment Arrangement [Abstract]

2022 Stock Option and Incentive Plan

In May 2022, the Company's stockholders approved the 2022 Stock Option and Incentive Plan (as amended, the "2022 Plan"). The number of shares of Common Stock available for awards under the 2022 Plan was set to 4,400,000, with any shares underlying awards that are forfeited, canceled, held back upon exercise of an option or settlement of an award to cover the exercise price or tax withholding, reacquired by the Company prior to vesting, satisfied without the issuance or shares, or otherwise terminated (other than by exercise) under the 2022 Plan may be added back to the shares of Common Stock available for issuance under the 2022 Plan. The 2022 Plan provides for the award of stock options (both incentive and non-qualified options), stock appreciation rights, restricted stock, restricted stock units ("RSUs"), unrestricted stock, cash-based awards, and dividend equivalent rights. Following the approval of the 2022 Plan, no further awards will be issued under the Company’s Amended and Restated 2013 Stock Option and Incentive Plan (the “2013 Plan”). In June 2023, the Company's stockholders approved an amendment to the 2022 Plan, which increased the number of shares of Common Stock reserved for awards under the 2022 Plan to 10,650,000.

Employee Stock Purchase Plan

In April 2020, the Company's board of directors approved the Esperion Therapeutics, Inc. 2020 Employee Stock Purchase Plan (as amended, the "ESPP") which was approved by the Company's stockholders on May 28, 2020. The ESPP allows eligible employees to authorize payroll deductions of up to 10% of their base salary or wages up to $25,000 annually to be applied toward the purchase of shares of Common Stock on the last trading day of the offering period. Participating employees will purchase shares of Common Stock at a discount of up to 15% on the lesser of the closing price of Common Stock on the NASDAQ Global Market (i) on the first trading day of the offering period or (ii) the last day of any offering period. Offering periods under the ESPP will generally be in six months increments, commencing on September 1 and March 1 of each calendar year with the administrator having the right to establish different offering periods. During the three months ended March 31, 2024, the Company recognized no stock compensation expense related to the ESPP. During the three months ended March 31, 2023, the Company recognized approximately $0.1 million of stock compensation expense related to the ESPP. As of March 31, 2024, there have been 610,506 shares issued and 214,494 shares reserved for future issuance under the ESPP. The Company paused the ESPP effective as of September 1, 2023, such that the offering periods which would otherwise have begun on September 1, 2023 and March 1, 2024 did not commence. The administrator will determine the next offering period, pursuant to the ESPP.

2017 Inducement Equity Plan

In May 2017, the Company's board of directors approved the Esperion Therapeutics, Inc. 2017 Inducement Equity Plan (as amended in November 2019 and August 2023, the "2017 Plan"). The number of shares of Common Stock available for awards under the 2017 Plan is 2,650,000, with any shares of Common Stock that are forfeited, cancelled, held back upon the exercise or settlement of an award to cover the exercise price or tax withholding, reacquired by the Company prior to vesting, satisfied without the issuance of Common Stock, or otherwise terminated (other than by exercise) under the 2017 Plan added back to the shares of Common Stock available for issuance under the 2017 Plan. The 2017 Plan provides for the granting of stock options, stock appreciation rights, restricted stock awards, restricted stock units ("RSUs"), unrestricted stock awards and dividend equivalent rights.

Stock Options

The following table summarizes the activity relating to the Company’s options to purchase Common Stock for the three months ended March 31, 2024:


	Number of Options	Weighted-Average Exercise Price Per Share		Weighted-Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value
					(in thousands)
Outstanding at December 31, 2023	3,686,191	$	13.88	7.47	$	584
Granted	1,757,000	$	2.05
Forfeited or expired	(47,000)	$	24.57
Exercised	—	$	—
Outstanding at March 31, 2024	5,396,191	$	9.94	8.18	$	1,569
Vested and expected to vest at March 31, 2024	5,396,191	$	9.94	8.18	$	1,569
Exercisable at March 31, 2024	1,847,040	$	22.25	6.02	$	30

Stock-based compensation related to stock options was $0.9 million for the three months ended March 31, 2024, including $0.1 million that was capitalized into inventory, and $1.0 million for the three months ended March 31, 2023, including $0.1 million that was capitalized into inventory. As of March 31, 2024, there was $8.5 million of unrecognized stock-based compensation expense related to unvested options, which will be recognized over a weighted-average period of 2.7 years.

Performance-Based Stock Options ("PBSOs")

In 2021, 2022, and 2023 the Company granted PBSOs from the 2013 Plan and the 2022 Plan, that vest upon various performance-based milestones as set forth in the individual grant agreements, such as achievement of predetermined clinical or regulatory outcomes. The actual number of units (if any) received under these awards will depend on continued employment and actual performance over the performance period. Each quarter, the Company updates their assessment of the probability that the performance milestone will be achieved. The Company amortizes the fair value of the PBSOs based on the expected performance period to achieve the performance milestone. The performance criteria was met in three months ended March 31, 2024.

The following table summarizes the activity relating to the Company’s PBSOs for the three months ended March 31, 2024:


	Number of Options	Weighted-Average Exercise Price Per Share		Weighted-Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value
					(in thousands)
Outstanding at December 31, 2023	661,850	$	4.97	8.63	$	312
Granted	—	$	—
Forfeited or expired	—	$	—
Exercised	—	$	—
Outstanding at March 31, 2024	661,850	$	4.97	8.38	$	242
Vested and expected to vest at March 31, 2024	661,850	$	4.97	8.38	$	242
Exercisable at March 31, 2024	661,850	$	4.97	8.38	$	242

Stock-based compensation related to PBSOs was $0.5 million for the three months ended March 31, 2024, and $0.2 million for the three months ended March 31, 2023. As of March 31, 2024, there was no unrecognized stock-based compensation expense related to unvested PBSOs.

Restricted Stock Units ("RSUs")

The following table summarizes the activity relating to the Company’s RSUs for the three months ended March 31, 2024:


	Number of RSUs	Weighted-Average Fair Value Per Share
Outstanding and unvested December 31, 2023	3,047,888	$	4.69
Granted	3,295,225	$	2.08
Forfeited	(18,754)	$	4.31
Vested	(283,408)	$	6.55
Outstanding and unvested March 31, 2024	6,040,951	$	3.18

Stock-based compensation related to RSUs was approximately $1.6 million for the three months ended March 31, 2024, including $0.1 million that was capitalized into inventory, and approximately $1.5 million for the three months ended March 31, 2023, including $0.1 million that was capitalized into inventory. As of March 31, 2024, there was $18.3 million of unrecognized stock-based compensation expense related to unvested RSUs, which will be recognized over a weighted-average period of 2.9 years.

Performance-based Restricted Stock Units ("PBRSUs")

In 2021, the Company granted PBRSUs from the 2013 Plan that vest upon various performance-based milestones as set forth in the individual grant agreements, such as achievement of predetermined milestones based on the Company's U.S. net product sales or clinical or regulatory outcomes. The actual number of units (if any) received under these awards will depend on continued employment and actual performance over the performance period. Each quarter, the Company updates their assessment of the probability that the performance milestone will be achieved. The Company amortizes the fair value of the PBRSUs based on the expected performance period to achieve the performance milestone. The fair value of the PBRSUs is based on the quoted market price of Common Stock on the date of grant. The performance criteria was met in three months ended March 31, 2024.

The following table summarizes the activity relating to the Company's PBRSUs for the three months ended March 31, 2024:


	Number of PBRSUs	Weighted-average fair value per share
Outstanding and unvested December 31, 2023	160,275	$	8.94
Granted	—	$	—
Forfeited	(3,900)	$	8.94
Vested	(156,375)	$	8.94
Outstanding and unvested March 31, 2024	—	$	—

Stock-based compensation related to the PBRSUs was $0.2 million for the three months ended March 31, 2024, including less than $0.1 million that was capitalized into inventory, and $0.1 million for the three months ended March 31, 2023, including less than $0.1 million that was capitalized into inventory. As of March 31, 2024, there was no unrecognized stock-based compensation expense related to unvested PBRSUs.