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Note 12 - Stock-based Compensation | 12 Months Ended
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Dec. 31, 2021
Notes to Financial Statements |
Share-based Payment Arrangement [Text Block] | Note 12 — Stock-Based Compensation As of December 31, 2021, the Company had three stock-based employee compensation plans, the Amended and Restated Stock Incentive Plan (“Incentive Plan”), the Amended and Restated Inducement Equity Incentive Plan (“Inducement Plan”) and the Employee Stock Purchase Plan (“ESPP”). The Incentive Plan was most recently amended and restated on April 1, 2021 and approved by the Company’s stockholders on May 25, 2021. The Inducement Plan was adopted by the Board of Directors on April 24, 2019 and was most recently amended and restated by the Board of Directors on July 23, 2021. The ESPP was most recently amended and restated on April 1, 2021 and approved by the Company’s stockholders on May 25, 2021. Stock-based compensation expense of $34,640 ($27,062 of expense related to the Incentive Plan, $6,055 of expense related to the Inducement Plan, $1,523 of expense related to the ESPP) was recognized during 2021, while $14,794 ($12,938 of expense related to the Incentive Plan, $1,494 of expense related to the Inducement Plan, $362 of expense related to the ESPP) was recognized during 2020 and $17,719 ($17,164 of expense related to the Incentive Plan, $323 of expense related to the Inducement Plan, $232 of expense related to the ESPP) was recognized during 2019. The Company accounts for stock-based compensation in accordance with FASB authoritative guidance regarding share-based payments. Total stock-based compensation was allocated as follows:
|  | Years Ended December 31, |
|  | 2021 |  |  | 2020 |  |  | 2019 |
Research and development |  | $ | 20,179 |  |  | $ | 10,222 |  |  | $ | 13,977 |
Selling, general and administrative |  |  | 14,461 |  |  |  | 4,572 |  |  |  | 3,742 |
Total stock-based compensation expense |  | $ | 34,640 |  |  | $ | 14,794 |  |  | $ | 17,719 |
Stock Incentive Plan The Company grants stock option awards, restricted stock and restricted stock units to its employees, directors, and consultants under the Incentive Plan. Under the Incentive Plan, stock option awards are granted with an exercise price equal to the market price of the Company’s stock at the date of grant. Commencing March 1, 2011, stock option awards and restricted stock units granted to employees generally vest 25% each year until fully vested after four years. In August 2013, December 2014 and December 2019, the Company issued 1,032, 1,250 and 315 performance-based stock options, respectively. These awards vest upon successful completion of specific development milestones. As of December 31, 2021, 100%, 85% and 100% of the August 2013, December 2014 and December 2019 grants, respectively, have vested. During 2020, the Company recognized $1,768 and $684 of stock compensation expense related to milestones within the August 2013 and December 2019 grants for which achievement became probable. Stock option awards granted to non-employee directors of the Company generally vest over one year. Stock option awards granted to new non-employee directors when they first join the Company’s Board of Directors generally vest, subject to the terms of the Incentive Plan, in 36 equal monthly installments over a three-year period measured from the grant date. All stock option awards have contractual terms of 10 years. The vesting exercise provisions of all awards granted under the Incentive Plan are subject to acceleration in the event of certain stockholder-approved transactions, or upon the occurrence of a change in control as defined in the Incentive Plan. Related activity under the Incentive Plan is as follows:
|  |  |  |  |  |  |  |  |  | Weighted |
|  |  |  |  |  |  |  |  |  | Average |
|  | Awards |  |  | Options |  |  | Exercise |
|  | Available |  |  | Outstanding |  |  | Price |
Balance at December 31, 2018 |  |  | 805 |  |  |  | 17,491 |  |  | $ | 6.49 |
Plan amendment |  |  | 4,000 |  |  |  | − |  |  |  | − |
Restricted stock awards granted |  |  | (27 | ) |  |  | − |  |  |  | − |
Stock option awards granted |  |  | (4,511 | ) |  |  | 4,511 |  |  |  | 3.91 |
Stock option awards exercised |  |  | − |  |  |  | (251 | ) |  |  | 3.75 |
Stock option awards cancelled |  |  | 701 |  |  |  | (701 | ) |  |  | 6.82 |
Balance at December 31, 2019 |  |  | 968 |  |  |  | 21,050 |  |  | $ | 5.96 |
Plan amendment |  |  | 8,000 |  |  |  | − |  |  |  | − |
Restricted stock awards granted |  |  | (31 | ) |  |  | − |  |  |  | − |
Stock option awards granted |  |  | (7,469 | ) |  |  | 7,469 |  |  |  | 8.06 |
Stock option awards exercised |  |  | − |  |  |  | (510 | ) |  |  | 3.56 |
Stock option awards cancelled |  |  | 3,124 |  |  |  | (3,124 | ) |  |  | 6.93 |
Balance at December 31, 2020 |  |  | 4,592 |  |  |  | 24,885 |  |  | $ | 6.52 |
Plan amendment |  |  | 7,500 |  |  |  | − |  |  |  | − |
Restricted stock units granted |  |  | (1,936 | ) |  |  | − |  |  |  | − |
Stock option awards granted |  |  | (6,753 | ) |  |  | 6,753 |  |  |  |  |
Stock option awards exercised |  |  | − |  |  |  | (2,705 | ) |  |  | 4.36 |
Stock option awards cancelled |  |  | 248 |  |  |  | (248 | ) |  |  | 7.62 |
Balance at December 31, 2021 |  |  | 3,651 |  |  |  | 28,685 |  |  | $ | 7.90 |
For stock option awards granted under the Incentive Plan during 2021, 2020, and 2019, the fair value was estimated on the date of grant using a Black-Scholes option pricing model and the assumptions noted in the table below. The weighted average grant date fair value of these awards granted during 2021, 2020, and 2019 was $7.93, $5.48, and $2.63, respectively. The fair value of the stock option awards is amortized to expense over the vesting periods using a straight-line expense attribution method. For restricted stock units granted under the Incentive Plan, the fair value of the awards was determined based on the market value of the Company’s shares on the grant date. The weighted average grant date fair value of these awards was $11.36. The fair value of the restricted stock unit awards is amortized to expense over the vesting periods using a straight-line expense attribution method. Inducement Equity Incentive Plan The Company has the ability to grant stock option awards to newly-hired employees as inducements material to each employee entering employment with the Company. Stock option awards granted to newly hired employees generally vest 25% each year until fully vested after four years. Each stock option has a term of 10 years and is subject to the terms and conditions of the Inducement Plan. The vesting and exercise provisions of all awards granted under the Inducement Plan are subject to acceleration in the event of certain stockholder-approved transactions, or upon the occurrence of a change in control as defined in the Inducement Plan. Related activity under the Inducement Plan is as follows:
|  |  |  |  |  |  |  |  |  | Weighted |
|  |  |  |  |  |  |  |  |  | Average |
|  | Awards |  |  | Options |  |  | Exercise |
|  | Available |  |  | Outstanding |  |  | Price |
Balance at December 31, 2020 |  |  | 229 |  |  |  | 4,171 |  |  | $ | 3.88 |
Plan amendment |  |  | 1,500 |  |  |  | − |  |  |  | − |
Stock option awards granted |  |  | (1,003 | ) |  |  | 1,003 |  |  |  | 13.91 |
Stock option awards exercised |  |  | − |  |  |  | (592 | ) |  |  | 3.63 |
Stock option awards cancelled |  |  | 174 |  |  |  | (174 | ) |  |  | 3.67 |
Balance at December 31, 2021 |  |  | 900 |  |  |  | 4,408 |  |  | $ | 6.20 |
For stock option awards granted under the Inducement Plan during 2021, 2020, and 2019, the fair value was estimated on the date of grant using a Black-Scholes option pricing model and the assumptions noted in the table below. The weighted average grant date fair value of these awards granted during 2021, 2020, and 2019 was $9.65, $2.73, and $2.41, respectively. The fair value of the stock option awards is amortized to expense over the vesting periods using a straight-line expense attribution method. The following table summarizes the key assumptions used by the Company to value the stock option awards granted under all plans during 2021, 2020, and 2019, respectively. The expected life is based on the average of the assumption that all outstanding stock option awards will be exercised at full vesting and the assumption that all outstanding stock option awards will be exercised at the midpoint of the current date (if already vested) or at full vesting (if not yet vested) and the full contractual term. The expected volatility represents the historical volatility on the Company’s publicly traded common stock. The Company has assumed no expected dividend yield, as dividends have never been paid to stock or option holders and will not be paid for the foreseeable future. The weighted average risk-free interest rate is the implied yield currently available on zero-coupon government issues with a remaining term equal to the expected term. Weighted Average Assumptions for Stock Option Awards Granted to Employees and Directors under the Plans
|  | 2021 |  |  | 2020 |  |  | 2019 |
Expected Life |  |  | 5.5 |  |  |  | 5.5 |  |  |  | 5.5 |
Expected Volatility |  |  | 84 | % |  |  | 84 | % |  |  | 81 | %
Expected Dividend Yield |  |  | 0.0 | % |  |  | 0.0 | % |  |  | 0.0 | %
Risk-Free Interest Rate |  |  | 1.1 | % |  |  | 0.4 | % |  |  | 1.8 | %
The total intrinsic value of stock option awards exercised under the Incentive Plan was $25,484 during 2021, $1,562 during 2020, and $1,127 during 2019. The intrinsic value represents the total proceeds (fair market value at the date of exercise, less the exercise price, times the number of stock option awards exercised) received by all individuals who exercised stock option awards during the period. The total intrinsic value of stock option awards exercised under the Inducement Plan was $6,700 during 2021. No stock option awards were exercised under the Inducement Plan in 2020. The following table summarizes, at December 31, 2021, by price range: (1) for stock option awards outstanding under the Incentive Plan, the number of stock option awards outstanding, their weighted average remaining life and their weighted average exercise price; and (2) for stock option awards exercisable under the Plan, the number of stock option awards exercisable and their weighted average exercise price:
|  |  |  |  |  |  | Outstanding |  |  | Exercisable |
|  |  |  |  |  |  |  |  |  | Weighted |  |  | Weighted |  |  |  |  |  |  | Weighted |
|  |  |  |  |  |  |  |  |  | Average |  |  | Average |  |  |  |  |  |  | Average |
|  |  |  |  |  |  |  |  |  | Remaining |  |  | Exercise |  |  |  |  |  |  | Exercise |
Range |  |  | Number |  |  | Life |  |  | Price |  |  | Number |  |  | Price |
$ | 0 | to | 3 |  |  |  | 1,874 |  |  |  | 5.9 |  |  | $ | 2.30 |  |  |  | 1,158 |  |  | $ | 2.12 |
| 3 | to | 6 |  |  |  | 10,190 |  |  |  | 6.5 |  |  |  | 4.22 |  |  |  | 7,317 |  |  |  | 4.41 |
| 6 | to | 9 |  |  |  | 10,599 |  |  |  | 8.2 |  |  |  | 7.89 |  |  |  | 4,317 |  |  |  | 7.56 |
| 9 | to | 12 |  |  |  | 8,228 |  |  |  | 8.1 |  |  |  | 11.14 |  |  |  | 2,120 |  |  |  | 10.86 |
| 12 | to | 15 |  |  |  | 1,291 |  |  |  | 6.8 |  |  |  | 13.10 |  |  |  | 535 |  |  |  | 12.31 |
| 15 | to | 18 |  |  |  | 911 |  |  |  | 9.0 |  |  |  | 15.95 |  |  |  | 114 |  |  |  | 15.56 |
$ | 0 | to | 18 |  |  |  | 33,093 |  |  |  | 7.5 |  |  | $ | 7.68 |  |  |  | 15,561 |  |  | $ | 6.34 |
The weighted average remaining contractual life of stock option awards exercisable under the plans at December 31, 2021 was 5.7 years. The aggregate intrinsic value of stock option awards outstanding and exercisable under the plans at December 31, 2021 was $116,811. The aggregate intrinsic value represents the value (the period’s closing market price, less the exercise price, times the number of in-the-money stock option awards) that would have been received by all stock option award holders under the plans had they exercised their stock option awards at the end of the year. The total fair value of the stock option awards vested under the plans was $23,395 during 2021, $18,739 during 2020, and $12,499 during 2019. As of December 31, 2021, the number of stock option awards vested and expected to vest under the plans is 30,268. The weighted average exercise price of these stock option awards is $7.64 and their weighted average remaining contractual life is 7.4 years. The following table summarizes the changes in the number and weighted-average grant-date fair value of non-vested stock option awards during 2021:
|  | Non-Vested Stock Option Awards |  |  | Weighted Average Grant-Date Fair Value |
Balance December 31, 2020 |  |  | 16,020 |  |  | $ | 4.25 |
Stock option awards granted |  |  | 7,756 |  |  |  | 3.31 |
Stock option awards vested |  |  | (5,837 | ) |  |  | 3.97 |
Stock option awards forfeited |  |  | (407 | ) |  |  | 4.14 |
Balance December 31, 2021 |  |  | 17,532 |  |  | $ | 3.86 |
As of December 31, 2021, there was approximately $107,852 of total unrecognized compensation cost related to non-vested employee stock option awards granted by the Company. That cost is expected to be recognized as follows: $35,060 in 2022, $30,375 in 2023, $27,607 in 2024, and $14,810 in 2025. Employee Stock Purchase Plan The Company has reserved a total of 7,975 shares of common stock to be purchased under the ESPP, of which 6,052 shares remain available for purchase at December 31, 2021. Eligible employees may authorize up to 15% of their salary to purchase common stock at the lower of 85% of the beginning or 85% of the ending price during six-month purchase intervals. No more than 3 shares may be purchased by any one employee at the six-month purchase dates and no employee may purchase stock having a fair market value at the commencement date of $25 or more in any one calendar year. There were 321, 246, and 115 shares of common stock purchased under the ESPP in 2021, 2020, and 2019, respectively, at a weighted average price per share of $6.20, $2.56, and $3.51, respectively. Expense of $1,523, $362, and $232 related to the ESPP was recognized during 2021, 2020, and 2019, respectively. Compensation expense for shares purchased under the ESPP related to the purchase discount and the “look-back” option were determined using a Black-Scholes option pricing model. The weighted average grant date fair values of shares granted under the ESPP during 2021, 2020, and 2019, were $2.80, $1.47, and $2.01, respectively.

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