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Stock-Based Compensation
 9 Months Ended
Sep. 30, 2014
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Stock-Based Compensation
Stock-Based Compensation
Our 2008 Equity Incentive Plan (the 2008 Plan) provides for the grant of incentive and non-statutory stock options, restricted stock, stock appreciation rights, performance units and performance shares to employees, directors and consultants and subsidiary corporations’ employees and consultants. Options are granted with exercise prices equal to the closing fair market value of our common stock on the date of the grant. The terms of options may not exceed 10 years and options generally vest over a four-year period.
On January 1, 2014, in accordance with provisions of the 2008 Plan, the authorized shares available for grant under the 2008 Plan were increased by 1,517,975 shares. As of September 30, 2014, a total of 8,741,276 shares were reserved for issuance under our stock plans, of which 1,961,278 were available for future grants under the 2008 Plan.
In October 2014, in connection with our annual employee review process, we granted qualified employees options to purchase approximately 1.2 million shares of our common stock with an exercise price of $11.58.
The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model. The following assumptions were applied to stock option grants during the periods ended:
 
Three Months Ended
September 30,
 
Nine Months Ended
September 30,
 
2014
 
2013
 
2014
 
2013
Estimated weighted-average fair value
$
10.18

 
$
6.77

 
$
8.39

 
$
6.73

Weighted-average assumptions
 
 
 
 
 
 
 
Expected volatility
70
%
 
88
%
 
82
%
 
87
%
Expected term, in years
6.1

 
5.8

 
5.9

 
5.8

Risk-free interest rate
1.95
%
 
1.66
%
 
1.90
%
 
1.65
%
Expected dividend yield
—
%
 
—
%
 
—
%
 
—
%

Stock-based compensation expense has been reported in our Consolidated Statements of Operations and Comprehensive Loss as follows:
 
 
Three Months Ended  
 September 30,
 
Nine Months Ended 
 September 30,
 
2014
 
2013
 
2014
 
2013
 
(In thousands)
 
(In thousands)
Research and development
$
879

 
$
1,371

 
$
2,791

 
$
2,518

Selling, general and administrative
786

 
840

 
2,292

 
1,846

Total
$
1,665

 
$
2,211

 
$
5,083

 
$
4,364


Stock option activity for all stock plans 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, 2013
6,969,303

 
$
6.38

 
 
 
 
Granted
184,250

 
12.00

 
 
 
 
Exercised
(159,332
)
 
6.39

 
 
 
 
Forfeited
(214,223
)
 
9.82

 
 
 
 
Balance at September 30, 2014
6,779,998

 
$
6.42

 
6.46
 
$
42,797

Vested and expected to vest at September 30, 2014
6,577,603

 
$
6.32

 
6.39
 
$
42,141

Exercisable at September 30, 2014
4,755,993

 
$
5.12

 
5.54
 
$
36,147


At September 30, 2014, there were 2,024,005 unvested options outstanding that will vest over a weighted-average period of 2.0 years. Excluding non-employee stock options, the total estimated compensation expense to be recognized in connection with these options is $11.1 million.