Stock Based Compensation

6 Months Ended

Jun. 30, 2019

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

6.	Stock Based Compensation

The following table summarizes stock option activity under the Company’s equity incentive plans and related information:

	Number of Shares Underlying Outstanding Options			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (Years)
Outstanding — December 31, 2018		1,361,977		$	12.04		8.71
Options granted		395,300		$	8.10
Options exercised		(41,219	)	$	4.57
Options forfeited		(60,290	)	$	8.14
Options expired		(7,474	)	$	74.90
Outstanding — June 30, 2019		1,648,294		$	11.14		8.60
Exercisable — June 30, 2019		547,822		$	15.74		7.95
Vested and expected to vest — June 30, 2019		1,648,294		$	11.14		8.60

Valuation Assumptions

The Company estimated the fair value of stock options granted using the Black-Scholes option-pricing formula and a single option award approach. Due to its limited history as a public company and limited number of sales of its common stock, the Company estimated its volatility considering a number of factors including the use of the volatility of comparable public companies. The expected term of options granted under the Plan, all of which qualify as “plain vanilla” per SEC Staff Accounting Bulletin 107, is determined based on the simplified method due to the Company’s limited operating history and is 5.98 years based on the average between the vesting period and the contractual life of the option. The risk-free rate is based on the yield of a U.S. Treasury security with a term consistent with the option. This fair value is being amortized ratably over the requisite service periods of the awards, which is generally the vesting period.

The fair value of employee stock options was estimated using the following weighted-average assumptions for the six months ended June 30, 2019 and 2018:

	Six Months Ended June 30,
	2019			2018
Employee Stock Options:
Risk-free interest rate		2.44	%		2.48	%
Expected term (in years)		5.98			5.93
Dividend yield		—			—
Volatility		88.21	%		104.37	%
Weighted-average fair value of stock options granted	$	5.96		$	13.38

Total stock-based compensation recognized was as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2019		2018		2019		2018
Research and development	$	284	$	137	$	522	$	252
General and administrative⁽¹⁾		619		414		1,210		904
Total stock-based compensation	$	903	$	551	$	1,732	$	1,156

(1)	Included $0.03 and $0.1 million in modifications related to certain Board member stock options in the three and six months ended June 30, 2019 and for the six months ended June 30, 2018, respectively.

Also included in total stock-based compensation for the three and six months ended June 30, 2019 is expense related to 5,999 shares of common stock issued to certain board members in lieu of their cash compensation.

As of June 30, 2019, 961,609 shares of common stock were available for future grant and 1,648,294 options to purchase shares of common stock were outstanding. As of June 30, 2019, the Company had unrecognized employee stock-based compensation expense of $7.1 million, related to unvested stock awards, which is expected to be recognized over an estimated weighted-average period of 2.78 years.