In 2018, the Company’s board of directors adopted the 89Bio Ltd. 2018 Equity Incentive Plan (the “2018 Plan”). In connection with the Reorganization, in September 2019, the Company’s board of directors approved the 2019 Equity Incentive Plan (the “2019 Plan”), which became effective on September 17, 2019. From and after the effective date of the 2019 Plan, the Company will no longer be making any future awards under the 2018 Plan.

The Company initially reserved 2,844,193 shares of common stock for issuance under the 2019 Plan. In addition, the number of shares of common stock reserved for issuance under the 2019 Plan will automatically increase on the first day of January for a period of up to ten years, commencing on January 1, 2020, in an amount equal to 4% of the total number of shares of the Company’s capital stock outstanding on the immediately preceding December 31, or a lesser number of shares determined by the Company’s board of directors. As of March 31, 2020, there were 1,676,191 shares of common stock available for issuance as future option grants under the 2019 Plan.

In October 2019, the Company adopted the 2019 Employee Stock Purchase Plan (“ESPP”), which became effective following the date of the IPO. The Company initially reserved 225,188 shares of common stock for purchase under the ESPP. The number of shares of common stock reserved for issuance under the ESPP will automatically increase on the first day of January for a period of up to ten years, in an amount equal to 1% of the total number of shares of the Company’s common stock outstanding on the immediately preceding December 31, or a lesser number of shares determined by the Company’s board of directors. Purchases will be accomplished through the participation of discrete offering periods. Each offering will be no more than 27 months long. For each offering period, ESPP participants will purchase shares of common stock at a price per share equal to 85% of the lesser of the fair market value of the Company’s common stock on (1) the first trading day of the applicable offering period or (2) the last trading day of each purchase period the applicable offering period.

The first six month offering period pursuant to the ESPP commenced on January 1, 2020. Total share-based compensation related to the ESPP for the three months ended March 31, 2020 was $13,000. As of March 31, 2020, 363,078 shares of common stock were available for issuance under the ESPP.

The Company recorded share-based compensation for the periods indicated as follows (in thousands):

	Three Months Ended
	March 31,
	2020		2019
Research and development	$	192	$	7
General and administrative		301		28
Total share-based compensation	$	493	$	35

The fair value of option awards granted for the periods indicated was estimated at the date of grant using a Black-Scholes option-pricing model with the following assumptions:

	Three Months Ended
	March 31,
	2020			2019
Stock Options
Expected term (years)	6.00-6.11				6.11
Expected volatility	86.4-87.5		%		61.8	%
Risk-free interest rate	0.5-1.5		%	2.5-2.6		%
Expected dividend		—			—

The following table summarizes stock option activity for the three months ended March 31, 2020:

						Weighted
				Weighted		Average
				Average		Remaining		Aggregate
	Number of			Exercise		Contractual		Intrinsic
	Options			Price		Term		Value
						(In years)		(In thousands)
Balance outstanding as of December 31, 2019		1,320,243		$	3.34		9.23	$	30,353
Granted		439,800			31.66
Exercised		(4,876	)		1.93
Cancelled		(40,482	)		2.87
Balance outstanding as of March 31, 2020		1,714,685			10.62		9.21	$	28,115
Exercisable as of March 31, 2020		299,571		$	2.00		8.69	$	6,850