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Stock-Based Compensation | 6 Months Ended
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Jun. 30, 2013
Stock-Based Compensation | Stock-Based Compensation Stock Options Our 2008 Equity Incentive Plan, or 2008 Plan, provides for the grant of incentive and nonstatutory stock options, restricted stock, stock appreciation rights, performance units and performance shares to employees, directors and consultants and subsidiary corporations’ employees and consultants. The 2008 Plan also allows any shares returned under our Amended and Restated 1998 Stock Option Plan, or 1998 Plan, as a result of cancellation of options or repurchase of shares issued pursuant to the 1998 Plan, to be issued under the 2008 Plan subject to a maximum limit of 3,084,848 shares. As of June 30, 2013 a total of 365,696 shares have been reserved under the 2008 Plan as a result of the cancellation of options or repurchase of shares under the 1998 Plan. In addition, the 2008 Plan provides for annual increases in the number of shares available for issuance thereunder on the first day of each fiscal year, beginning with the 2010 fiscal year, equal to the lowest of:
• | five percent of the outstanding shares of our common stock on the last day of the immediately preceding fiscal year;
• | 1,785,714 shares; or
• | such other amount as our board of directors may determine.
On January 1, 2013, in accordance with the 2008 Plan annual increase provisions, the authorized shares in the 2008 Plan increased by 1,294,874 shares. As of June 30, 2013, a total of 5,835,258 shares were reserved for issuance under the 2008 Plan. Options are granted with exercise prices equal to the closing fair market value of the common stock on the date of the grant. The terms of options may not exceed 10 years. Generally, options vest over a four-year period, but may be granted with different vesting terms. Compensation cost for stock options granted to employees is based on the grant-date fair value and is recognized over the vesting period of the applicable option on a straight-line basis. As stock-based compensation expense is based on options ultimately expected to vest, the expense has been reduced for estimated forfeitures. The fair value of each employee option grant was estimated on the date of grant using the Black-Scholes option- pricing model with the following assumptions during the periods ended:
| Three Months Ended June 30, |  | Six Months Ended June 30,
| 2013 |  | 2012 |  | 2013 |  | 2012
Estimated weighted-average fair value | $ | 3.57 |  |  | $ | 7.09 |  |  | $ | 3.57 |  |  | $ | 3.28 |
Weighted-average assumptions |  |  |  |  |  |  |
Expected volatility | 82 | % |  | 86 | % |  | 82 | % |  | 89 | %
Expected term, in years | 5.5 |  |  | 5.5 |  |  | 5.5 |  |  | 5.7 |
Risk-free interest rate | 1.02 | % |  | 0.78 | % |  | 1.02 | % |  | 1.05 | %
Expected dividend yield | — | % |  | — | % |  | — | % |  | — | %
Stock-Based Compensation Summary Stock-based compensation expense includes amortization of stock options granted to employees and non-employees’ and has been reported in our consolidated statements of operations as follows:
| Three Months Ended June 30, |  | Six Months Ended June 30,
| 2013 |  | 2012 |  | 2013 |  | 2012
| (In thousands) |  | (In thousands)
Research and development | $ | 566 |  |  | $ | 285 |  |  | $ | 1,147 |  |  | $ | 853 |
Selling, general and administrative | 494 |  |  | 284 |  |  | 1,006 |  |  | 847 |
Total | $ | 1,060 |  |  | $ | 569 |  |  | $ | 2,153 |  |  | $ | 1,700 |
Stock option activity and related information is as follows:
| Options Outstanding |  | Weighted- Average Exercise Price per Share |  | Remaining Contractual Life (in years) |  | Aggregate Intrinsic Value (In thousands)
Balance at December 31, 2012 | 5,390,582 |  |  | $ | 5.18 |  |  |  |  |
Granted | 25,000 |  |  | 5.30 |  |  |  |  |
Exercised | (32,284 | ) |  | 1.31 |  |  |  |  |
Forfeited | (74,437 | ) |  | 7.45 |  |  |  |  |
Balance at June 30, 2013 | 5,308,861 |  |  | $ | 5.18 |  |  | 6.76 |  | $ | 7,650 |
Vested and expected to vest at June 30, 2013 | 5,142,695 |  |  | $ | 5.09 |  |  | 6.70 |  | $ | 7,604 |
Exercisable at June 30, 2013 | 3,540,828 |  |  | $ | 3.87 |  |  | 5.75 |  | $ | 7,191 |
At June 30, 2013, there were 1,768,033 unvested options outstanding that will vest over a weighted-average period of 2.4 years. Excluding non-employee stock options, the total estimated compensation expense to be recognized in connection with these shares is $8.0 million.

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- Definition The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5047-113901 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5070-113901 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 50 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6406099&loc=d3e25284-112666 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 123R -Paragraph 64, 65, A240 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 40 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6418621&loc=d3e17540-113929 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5444-113901 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Staff Accounting Bulletin (SAB) -Number Topic 14 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher AICPA -Name Statement of Position (SOP) -Number 93-6 -Paragraph 53 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. + Details
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