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Stockholders' Equity | 12 Months Ended
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Dec. 31, 2024
Equity [Abstract] |
Stockholders' Equity | Stockholders’ Equity Amended and Restated Certificate of Incorporation On June 16, 2020, the Company’s certificate of incorporation was amended and restated to authorize 400,000,000 shares of common stock and 40,000,000 shares of undesignated preferred stock, each with a par value of $0.0001 per share. There was no preferred stock outstanding as of December 31, 2024, 2023, or 2022. Common Stock On November 8, 2022, we entered into a sales agreement (the 2022 Sales Agreement) with the Cowen and Company, LLC (the Sales Agent), under which we could, from time to time, sell shares of our common stock having an aggregate offering price of up to $200.0 million through the Sales Agent. Sales of the shares of common stock were made at prevailing market prices at the time of sale, or as otherwise agreed with the Sales Agent. During the years ended December 31, 2024 and 2023, we sold 418,408 and 4,107,810 shares of its common stock, respectively, pursuant to the Sales Agreement and received net proceeds of $5.6 million and $60.5 million, respectively, after deducting offering-related transaction costs and commissions of $0.1 million and $1.4 million, respectively. On November 27, 2023, we sold 5,075,304 unregistered shares of our common stock to BMS in a private placement under the terms of the BMS Purchase Agreement. The approximate proceeds related to the sale were $40.0 million of which $31.2 million was recorded as common stock and additional paid in capital, net of issuance costs of $0.1 million, and $8.7 million was recorded as deferred revenue (Note 5). On March 4, 2024, we sold 15,224,773 unregistered shares of our common stock and pre-funded warrants in lieu of common stock to purchase up to an aggregate of 9,030,851 shares of our common stock to investors in a private placement at an offering price of $16.50 per share and $16.499 per pre-funded warrant, which represents the offering price per share of common stock less an exercise price of $0.001 per share. We valued the common stock at the offering price, concluding that the offering price approximated fair value. The net proceeds from the private placement were $379.8 million after deducting placement fees and offering costs of $20.4 million. The resale of the shares, including the shares issuable upon exercise of the pre-funded warrants, were subsequently registered on a Registration Statement on Form S-3 filed with the SEC on April 2, 2024, which became automatically effective upon its filing. The pre-funded warrants are a freestanding instrument that do not meet the definition of a liability pursuant to ASC 480 and do not meet the definition of a derivative pursuant to ASC 815. We valued the pre-funded warrants at the offering price, concluding that the offering price approximated fair value. The pre-funded warrants meet the equity classification criteria and were accounted for as a component of additional paid-in capital. The pre-funded warrants are immediately exercisable and do not expire. One of the investors who participated in the private placement met the criteria of a related party as such investor was a principal owner of more than 10% of the voting interest in the Company (the Principal Owner). The Principal Owner purchased 2,121,213 shares of the Company's common stock for $35.0 million. The purchase of common stock under the private placement by the Principal Owner was carried out at arm's length as substantiated by the fact that the per share purchase price equaled the price paid by other participants. No amounts were due from the Principal Owner as of December 31, 2024. On June 17, 2024, we completed a public offering of 12,132,500 shares of our common stock at a public offering price of $38.00 per share. Net proceeds from the offering were approximately $432.8 million, after deducting underwriting discounts and offering expenses of $28.3 million. The shares sold in the offering were registered pursuant to the Company's shelf registration statement on Form S-3, which became automatically effective upon its filing on May 9, 2024. On August 9, 2024, we entered into a sales agreement (the 2024 Sales Agreement) with TD Securities (USA) LLC (the 2024 Sales Agent) which contained substantially similar terms as the 2022 Sales Agreement. The 2022 Sales Agreement was terminated upon effectiveness of the 2024 Sales Agreement. Under the 2024 Sales Agreement, we may, from time to time, sell shares of our common stock having an aggregate offering price of up to $400.0 million through the 2024 Sales Agent. Sales of the shares of common stock, if any, will be made at prevailing market prices at the time of sale, or as otherwise agreed with the 2024 Sales Agent. We are not obligated to sell, and the 2024 Sales Agent is not obligated to buy or sell, any shares of common stock under the 2024 Sales Agreement. As of December 31, 2024, we had sold no shares of our common stock under the 2024 Sales Agreement. On August 16, 2024, we completed a public offering of 8,418,000 shares of our common stock at a public offering price of $41.00 per share. Net proceeds from the offering were approximately $323.7 million, after deducting underwriting discounts and offering expenses of $21.4 million. The shares sold in the offering were registered pursuant to the Company's shelf registration statement on Form S-3, which became automatically effective upon its filing on May 9, 2024. Equity Incentive Plans The Company's board of directors adopted, and the company's shareholders approved, the 2013 Equity Incentive Plan (the 2013 Plan) and the 2020 Incentive Award Plan (the 2020 Plan). Under the plans, the Company may grant stock options, restricted stock, dividend equivalents, restricted stock units, stock appreciation rights, and other stock or cash-based awards to individuals who are then employees, officers, non-employee directors or consultants of the Company. The Company ceased granting awards under the 2013 Plan in June 2020 upon adopting the 2020 Plan. A total of 3,900,000 shares of common stock were initially reserved for issuance under the 2020 Plan. The number of shares of common stock available for issuance under the 2020 Plan will be increased annually on the first day of each fiscal year during the term of the 2020 Plan, beginning with the 2021 fiscal year, by an amount equal to the lesser of (a) 5% of the shares of common stock outstanding on the final day of the immediately preceding calendar year or (b) such smaller number of shares as determined by the Company’s board of directors. At December 31, 2024, 1,591,462 shares were available for grant under the 2020 Plan, inclusive of 3,963,742 additional shares which were reserved for issuance during the year ended December 31, 2024. In December 2022, the Company’s board of directors adopted the 2022 Employment Inducement Incentive Award Plan, which it amended in June 2024 (the Inducement Plan). Under the Inducement Plan, the Company may grant non-qualified stock options, restricted stock, restricted stock units, stock appreciation rights, and other stock or cash-based awards to an employee in connection with his or her commencement of employment with the Company or an affiliate. A total of 4,500,000 shares of common stock were reserved for issuance under the Inducement Plan. At December 31, 2024, 697,350 shares were available for grant under the Inducement Plan, inclusive of 3,000,000 additional shares which were reserved for issuance during the year ended December 31, 2024. Stock Options Options granted from the 2013 Plan, 2020 Plan, and the Inducement Plan are exercisable at various dates and will expire no more than ten years from their date of grant. Options generally vest over a four-year period. Prior to the IPO, the exercise price of options was determined by the Company’s board of directors. Following the IPO, the Company grants options with an exercise price equal to the fair market value of the Company’s stock on the date of the option grant. Stock option activity in 2024 for employee and non-employee awards and related information is as follows (in thousands, except per share and contractual term data):
| Number of Outstanding Options |  | Weighted- Average Exercise Price Per Share |  | Weighted- Average Remaining Contractual Term (in years) |  | Aggregate Intrinsic Value
Balance at December 31, 2023 | 12,495 |  | $ | 14.91 |  |  |  |  |
Granted | 4,162 |  | 27.06 |  |  |  |  |
Exercised | (3,498) |  | 13.78 |  |  |  |  |
Forfeited/expired | (524) |  | 15.70 |  |  |  |  |
Balance at December 31, 2024 | 12,635 |  | $ | 19.19 |  |  | 7.88 |  | $ | 149,957 |
Vested and expected to vest at December 31, 2024 | 12,635 |  | $ | 19.19 |  |  | 7.88 |  | $ | 149,957 |
Exercisable at December 31, 2024 | 5,772 |  | $ | 15.32 |  |  | 6.89 |  | $ | 79,900 |
The aggregate intrinsic values presented in the table above were calculated as the difference between the closing price of the Company’s common stock at December 31, 2024 and the exercise price of stock options that had strike prices below the closing price. The following summarizes additional information regarding stock options (in thousands, except per share data):
| Year Ended December 31,
| 2024 |  | 2023 |  | 2022
Cash received from options exercised | $ | 48,207 |  |  | $ | 573 |  |  | $ | 470 |
Intrinsic value of options exercised | $ | 83,422 |  |  | $ | 2,421 |  |  | $ | 6,724 |
Weighted-average grant date fair value per share | $ | 19.26 |  |  | $ | 10.33 |  |  | $ | 11.11 |
The total intrinsic values of options exercised was calculated as the difference between the fair value of the Company’s common stock at the time of the option exercise and the exercise price of that stock option. Restricted Stock Units and Performance Stock Units During the year ended December 31, 2024, under the 2020 Incentive Award Plan and the 2022 Employment Inducement Incentive Award Plan, the Company granted Restricted Stock Units (RSUs) and Performance Stock Units (PSUs) to employees of the Company. PSUs were granted to the Company's officers. RSUs and PSUs are valued at the market price of a share of the Company’s stock on the date of grant. RSUs vest ratably on an annual basis over a service period and are payable in shares of common stock on the vesting date. Compensation expense for RSUs is recognized on a straight-line basis over the service period. Compensation expense for PSUs is recognized on a straight-line basis over the requisite service periods when the achievement of the performance condition is determined to be probable, using management's best estimate. If a performance condition is not determined to be probable or is not met, no stock-based compensation expense is recognized, and any previously recognized expense is reversed. Forfeitures are recorded in the period in which they occur. The following table summarizes the RSU activity for the year ended December 31, 2024 (in thousands, except per share data):
| Number of Shares |  | Weighted-Average Grant Date Fair Value
Balance at December 31, 2023 | 758 |  |  | $ | 18.73 |
Granted | 1,711 |  |  | 25.51 |
Vested | (184) |  |  | 18.79 |
Forfeited | (174) |  |  | 14.82 |
Balance at December 31, 2024 | 2,111 |  |  | $ | 24.54 |
During the years ended December 31, 2024 and 2023, stock-based compensation expense of $7.0 million and $0.9 million was recognized, respectively. There was no stock-based compensation expense recognized for the year ended December 31, 2022. During the year ended December 31, 2024, 184,293 RSUs vested with a total fair value of $3.5 million. During the years ended December 31, 2023 and 2022, no RSUs vested. The following table summarizes the PSU activity for the year ended December 31, 2024 (in thousands, except per share data):
| Number of Shares |  | Weighted-Average Grant Date Fair Value
Balance at December 31, 2023 | 750 |  |  | $ | 6.57 |
Granted | 738 |  |  | 43.22 |
Vested | (563) |  |  | 6.57 |
Forfeited | — |  |  | — |
Balance at December 31, 2024 | 925 |  |  | $ | 35.80 |
During the year ended December 31, 2024, the performance conditions related to 750,000 units of outstanding PSUs were met or deemed probable resulting in (1) the vesting of 562,500 shares, (2) the expected vesting of 187,500 shares in March 2025, and (3) the recognition of $4.8 million in stock-based compensation expense. No stock-based compensation expense has been recognized for the remaining 738,000 outstanding PSUs as the performance conditions were not deemed probable. The total fair value of PSU shares vested during the year ended December 31, 2024 was $22.1 million. During the years ended December 31, 2023 and 2022, no PSUs vested and no stock-based compensation expense was recognized. Employee Stock Purchase Plan In June 2020, the Company adopted the ESPP, which permits participants to contribute up to 15% of their eligible compensation during defined rolling six-month offering periods to purchase the Company’s common stock. The purchase price of the shares will be 85% of the lower of the fair market value of the Company’s common stock on the first day of trading of the offering period or on the applicable purchase date. The Company issued 179,150, 175,511, and 90,535 shares of common stock under the ESPP during the years ended December 31, 2024, 2023, and 2022, respectively. The Company had an outstanding liability of $0.3 million at December 31, 2024, which is included in accounts payable and accrued liabilities on the consolidated balance sheet, for employee contributions to the ESPP for shares pending issuance at the end of the current offering period. As of December 31, 2024, 193,367 shares of common stock were available for issuance under the ESPP. Stock-Based Compensation Expense The assumptions used in the Black-Scholes model to determine the fair value of stock option grants and shares purchasable under the ESPP were as follows:
| Options |  | ESPP
| Year Ended December 31, |  | Year Ended December 31,
| 2024 |  | 2023 |  | 2022 |  | 2024 |  | 2023 |  | 2022
Risk-free interest rate | 3.5% - 4.7% |  | 3.5% - 4.9% |  | 1.5% - 4.2% |  | 4.3% - 5.4% |  | 5.4% |  | 2.2% - 4.7%
Expected volatility | 79% - 82% |  | 78% - 82% |  | 85% |  | 64% - 82% |  | 68% - 76% |  | 78% - 79%
Expected term (in years) | 5.3 - 6.1 |  | 5.5 - 6.1 |  | 5.5 - 6.1 |  | 0.5 |  | 0.5 |  | 0.5
Expected dividend yield | —% |  | —% |  | —% |  | —% |  | —% |  | —%
Risk-Free Interest Rate. The Company bases the risk-free interest rate assumption for equity awards on the rates for U.S. Treasury zero-coupon bonds with maturities similar to those of the expected term of the award being valued. Expected Volatility. The expected volatility of stock options is estimated based on the average historical volatilities of common stock of comparable publicly traded companies and the Company's own volatility. The comparable companies are chosen based on their size and stage in the life cycle. The Company will continue to apply this process until a sufficient amount of historical information regarding the volatility of its own stock price becomes available. Prior to 2023, the Company exclusively used peer group companies to determine expected volatility. The expected volatility for employee stock purchases under the ESPP is based on the Company's own historical volatility for the prior six months to conform with the six-month ESPP offering period. Expected Term. The Company's limited option exercise history does not provide a reasonable basis for estimating expected term, therefore the Company has estimated the expected life of its stock options using the simplified method, whereby the expected life equals the average of the vesting term and the original contractual term of the option. The expected life assumption for employee stock purchases under the ESPP is six months to conform with the six-month ESPP offering period. Expected Dividend Yield. The Company’s expected dividend yield assumption is zero as it has never paid dividends and has no present intention to do so in the future. The allocation of stock-based compensation expense was as follows (in thousands):
| Year Ended December 31,
| 2024 |  | 2023 |  | 2022
Research and development expense | $ | 26,120 |  |  | $ | 22,007 |  |  | $ | 15,222 |
General and administrative expense | 25,243 |  |  | 16,215 |  |  | 11,917 |
Total stock-based compensation expense | $ | 51,363 |  |  | $ | 38,222 |  |  | $ | 27,139 |
As of December 31, 2024, the unrecognized compensation cost related to outstanding time-based options and RSUs was $102.5 million and $45.2 million, respectively, which is expected to be recognized over a weighted-average period of 2.7 years and 3.2 years, respectively. Unrecognized compensation cost related to PSUs was $32.1 million as of December 31, 2024 for which $0.2 million is deemed probable and is expected to be recognized over a weighted-average period of 0.2 years. As of December 31, 2024, the unrecognized compensation cost related to stock purchase rights under the ESPP was $0.9 million, which is expected to be recognized over a weighted-average period of 0.5 years.

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- Definition The entire disclosure for shareholders' equity and share-based payment arrangement. Includes, but is not limited to, disclosure of policy and terms of share-based payment arrangement, deferred compensation arrangement, and employee stock purchase plan (ESPP). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 505 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/505/tableOfContent Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 718 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/718/tableOfContent + Details
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