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Stock-based Compensation | 3 Months Ended
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Mar. 31, 2024
Share-Based Payment Arrangement [Abstract] |
Stock-based Compensation | Stock-based Compensation 2021 Equity Incentive Plan In June 2021, the Company adopted the 2021 Equity Incentive Plan (“2021 Plan”), which on the date of the underwriting agreement related to the Company’s IPO became effective with an initial reserve of 26,662,087 shares, plus any shares subject to outstanding awards granted under the 2018 Equity Incentive Plan (“2018 Plan”) that, on or after the effectiveness of the 2021 Plan, terminate or expire before exercise or settlement, are not issued because the award is settled in cash, are forfeited because of the failure to vest, or are reacquired or withheld (or not issued) to satisfy a tax withholding obligation or the purchase or exercise price. In addition, the number of shares reserved for issuance under the 2021 Plan automatically increases on January 1 of each year for a period of ten years, beginning on January 1, 2022 and continuing through January 1, 2031, in an amount equal to (1) 5% of the total number of shares of the Company’s common stock outstanding on December 31 of the immediately preceding year, or (2) a lesser number of shares determined by the Company’s board of directors no later than December 31 of the immediately preceding year. On January 1, 2024, the Company reserved an additional 12,697,885 shares of common stock for issuance under the 2021 Plan representing 5% of the total common shares outstanding as of December 31, 2023. Under the 2021 Plan, the Company may grant incentive stock options, non-statutory stock options, restricted stock awards (“RSAs”), restricted stock units (“RSUs”), PSUs, stock appreciation rights, performance awards and other stock-based awards. Terms of stock awards, including vesting requirements, are determined by the Company’s board of directors or by a committee authorized by the Company’s board of directors, subject to provisions of the 2021 Plan. The term of any stock option granted under the 2021 Plan cannot exceed ten years. Generally, option and RSU awards granted by the Company vest over four years but may be granted with different vesting terms. PSUs generally vest over three years, subject to the achievement of the associated performance conditions. In conjunction with adopting the 2021 Plan, the Company discontinued the 2018 Plan with respect to new equity awards. As of March 31, 2024, 33,623,495 shares were available for future issuance pursuant to the 2021 Plan. 2021 Employee Stock Purchase Plan In June 2021, the Company adopted the 2021 Employee Stock Purchase Plan (“2021 ESPP”), which became effective immediately prior to the execution of the underwriting agreement related to the Company’s IPO with an initial reserve of 2,470,000 shares. The 2021 ESPP allows eligible employees to purchase shares of the Company’s common stock at a discount through payroll deductions of up to 15% of their earnings, subject to plan limitations. Unless otherwise determined by the Company’s board of directors, employees are able to purchase shares at 85% of the lower of the fair market value of the Company’s common stock on the first date of an offering or on the purchase date. The number of shares of the Company’s common stock reserved for issuance under the 2021 ESPP automatically increases on January 1 of each year for a period of ten years, beginning on January 1, 2022 and continuing through January 1, 2031, by the lesser of (1) 1% of the total number of shares of the Company’s common stock outstanding on December 31 of the immediately preceding year, and (2) 4,940,000 shares; provided, however, that the Company’s board of directors may act to provide a lesser increase in number of shares. On January 1, 2024, the Company reserved an additional 2,539,577 shares of common stock for issuance under the 2021 ESPP representing 1% of the total common shares outstanding as of December 31, 2023. The Company may specify offerings with durations not more than 27 months and may specify shorter purchase periods within each offering. Under the 2021 ESPP, no shares were issued for both the three months ended March 31, 2024 and 2023. As of March 31, 2024, 6,001,206 shares were available for future issuance pursuant to the 2021 ESPP. 2018 Equity Incentive Plan In 2018, the Company established the 2018 Plan that provided for the grant of incentive stock options, non‑statutory stock options, RSAs, RSUs, stock appreciation rights and other stock-based awards. Terms of stock awards, including vesting requirements, were determined by the board of directors or by a committee authorized by the Company’s board of directors, subject to provisions of the 2018 Plan. The term of any stock option granted under the 2018 Plan cannot exceed ten years. Generally, awards granted by the Company vest over four years, but could have been granted with different vesting terms. Pursuant to the terms of the 2021 Plan, any shares subject to outstanding options originally granted under the 2018 Plan that terminate, expire or lapse for any reason without the delivery of shares to the holder thereof become available for issuance pursuant to awards granted under the 2021 Plan. While no shares are available for future issuance under the 2018 Plan, it continues to govern outstanding equity awards granted thereunder. Stock-based Compensation Expense Stock-based compensation expense by classification included within the Condensed Consolidated Statements of Operations and Comprehensive Loss was as follows (in thousands):
| Three Months Ended March 31, |  |
| 2024 |  | 2023 |  |  |  |
Research and development | $ | 3,792 |  |  | $ | 4,612 |  |  |  |  |
General and administrative | 5,363 |  |  | 9,270 |  |  |  |  |
Total stock-based compensation expense | $ | 9,155 |  |  | $ | 13,882 |  |  |  |  |
At March 31, 2024, total stock-based compensation cost related to unvested awards not yet recognized was $66.0 million, which is expected to be recognized over a remaining weighted-average period of 2.7 years. Stock Options Repricing In November 2023, the Board of Directors of the Company approved, effective November 16, 2023, a one-time repricing of certain stock option awards that had been granted to date under the 2021 Plan and 2018 Plan. The repricing impacted stock options with exercise prices greater than $2.37 held by employees who remained employed as of November 16, 2023 and were not impacted by the Company’s November 2023 reduction in workforce. The original exercise prices of the repriced stock options ranged from $2.61 to $17.95 per share for 200 total grantees with 23,416,860 shares repriced. Each stock option was repriced to have a per share exercise price of $1.87, which was the closing price of the Company’s common stock on November 16, 2023. To receive the new exercise price, option holders must remain employed with the Company through November 15, 2024. Additionally, the vesting schedule for the unvested shares underlying repriced stock options held by executives at the level of senior vice president and above was extended for an additional year. There were no changes to the vesting schedules for employees below the level of senior vice president. No changes were made to the expiration dates of, or the number of shares underlying, the repriced stock options. Incremental stock-based compensation expense resulting from the repricing was $8.9 million in the aggregate. Expense for vested awards will be recognized through November 15, 2024 and expense for unvested awards will be recognized over the remaining service life of the option. Performance-Based Restricted Stock Units During the three months ended March 31, 2024, the Company granted PSU awards to certain key employees. PSUs awarded to employees have a three-year performance period and vest based upon the Company’s performance against a two and three-year relative total shareholder return (“rTSR”) metric, as well as upon the achievement of certain clinical development milestones. For the portion of PSUs subject to certain clinical development milestones (other than the bonus clinical development milestone), 50% vest upon the achievement of the applicable milestone, and the remaining 50% vest upon the earlier of (a) one year of service from the date of such achievement and (b) the end of the three-year performance period. The vesting of all PSU awards granted is also subject to the respective employee’s continued employment. The Company valued the portion of PSUs subject to the rTSR metric using a Monte Carlo simulation. The number of PSUs granted subject to the rTSR metrics represents the target number of units that are eligible to be earned based on the achievement of the metrics established at the beginning of the performance period, which ends on December 31 st of the three year performance period. For the portion of PSUs subject to the rTSR metrics, employees may ultimately earn between zero and 200% of the target number of PSUs granted based on the degree of achievement of the applicable rTSR metric. Accordingly, additional PSUs may be issued or currently outstanding PSUs may be cancelled upon final determination of the number of units earned. A summary of the Company’s PSU activity was as follows:
| Performance-Based Restricted Stock Units Outstanding |  | Weighted-Average Value at Grant Date Per Share
Unvested PSUs as of December 31, 2023 | — |  |  | $ | — |
PSUs granted(1) | 2,703,400 |  |  | $ | 1.88 |
PSUs vested | — |  |  | $ | — |
PSUs forfeited or canceled | — |  |  | $ | — |
Unvested PSUs as of March 31, 2024 | 2,703,400 |  |  | $ | 1.88 |
(1) PSU grants reflect the target number of shares eligible to be earned at the time of grant. Restricted Stock Units A summary of the Company’s RSU activity was as follows:
| Restricted Stock Units Outstanding |  | Weighted-Average Value at Grant Date Per Share
Unvested RSUs as of December 31, 2023 | 2,072,855 |  |  | $ | 2.96 |
RSUs granted | 3,477,351 |  |  | $ | 1.81 |
RSUs vested | (142,430) |  |  | $ | 3.43 |
RSUs forfeited or canceled | (73,298) |  |  | $ | 2.24 |
Unvested RSUs as of March 31, 2024 | 5,334,478 |  |  | $ | 2.21 |
Stock Options A summary of the Company’s stock option activity was as follows:
| Number of Stock Options |  | Weighted- Average Exercise Price Per Share |  | Weighted- Average Remaining Contractual Life (in years) |  | Aggregate Intrinsic Value (in thousands)
Options outstanding as of December 31, 2023 | 55,596,831 |  | $ | 4.75 |  |  | 6.89 |  | $ | 7,368 |
Granted | 2,495,500 |  | $ | 1.83 |  |  |  |  |
Exercised | (868,826) |  |  | $ | 0.12 |  |  |  |  |
Canceled or forfeited | (3,096,127) |  |  | $ | 5.57 |  |  |  |  |
Options outstanding as of March 31, 2024 | 54,127,378 |  | $ | 4.64 |  |  | 7.20 |  | $ | 8,295 |
Options exercisable as of March 31, 2024 | 31,963,665 |  | $ | 5.17 |  |  | 6.19 |  | $ | 6,758 |
The fair value of stock options granted to employees and directors was estimated on the date of grant using the Black-Scholes option pricing model using the following weighted-average assumptions:
| Three Months Ended March 31,
| 2024 |  | 2023
Risk-free interest rate | 4.15 | % |  | 4.13 | %
Expected volatility | 75.9 | % |  | 91.9 | %
Expected term (in years) | 6.04 |  | 6.02
Expected dividend yield | 0 | % |  | 0 | %
The weighted-average grant date fair value of options granted for the three months ended March 31, 2024 and 2023 were $1.26 per share and $1.66 per share, respectively.

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