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Note 13 - Equity Incentive Plan | 12 Months Ended
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Dec. 31, 2018
Notes to Financial Statements |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | 13. Equity Incentive Plan Equity Incentive Plan The Anika Therapeutics, Inc. 2017 Omnibus Incentive Plan (the “2017 Plan”) was approved by the Company’s stockholders on June 13, 2017 and provides for the grant of incentive stock options, nonqualified stock options, SARs, RSAs, RSUs, and performance options that may be settled in cash, stock, or other property. In accordance with the 2017 Plan approved by the Company’s stockholders, each share award other than stock options or SAR’s will reduce the number of total shares available for grant by 2.0 shares. Subject to adjustment for specified types of changes in the Company’s capitalization, no more than 1.2 million shares of common stock may be issued under the 2017 Plan. There are 0.9 million shares available for future grant at December 31, 2018. The 2017 Plan replaced the Anika Therapeutics, Inc. Stock Option and Incentive Plan, as amended, (the “2003 Plan”), as the plan under which future grants to employees, directors, officers, and consultants will be made. The terms of the 2003 Plan provide for grants of nonqualified and incentive stock options, common stock, RSAs, RSUs, and SARs to employees, directors, officers, and consultants. The 2003 Plan was approved by the Company’s stockholders on June 4, 2003 and subsequently amended by the Board of Directors on May 29, 2009 and by the Company’s stockholders on June 7, 2011 and June 18, 2013 to increase the number of shares reserved for issuance. Pursuant to the 2011 amendment, each share award issued after June 7, 2011, other than stock options or SARs, reduced the number of total shares available for grant by 1.9 shares. Pursuant to the 2013 amendment, each share award issued after June 18, 2013, other than stock options or SARs, reduced the number of total shares available for grant by 1.5 shares. The Company may satisfy the awards upon exercise, or upon fulfillment of the vesting requirements for other equity-based awards, with either newly-issued shares or shares reacquired by the Company. Stock-based awards are granted with an exercise price equal to the market price of the Company’s stock on the date of grant. Awards contain service conditions or service and performance conditions, and they generally become exercisable ratably over one to four years with a maximum contractual term of ten years. The Company estimates the fair value of stock options and SARs using the Black-Scholes valuation model. Fair value of restricted stock is measured by the grant-date price of the Company’s shares. Key input assumptions used to estimate the fair value of stock options and SARs include the exercise price of the award, the expected award term, the expected volatility of the Company’s stock over the option’s expected term, the risk-free interest rate over the award’s expected term, and the Company’s expected annual dividend yield. The expected volatility assumption is evaluated against the historical volatility of the Company’s common stock over a 4.5 year average, and it is adjusted if there are material changes in historical volatility. The risk-free interest rate assumption is based on U.S. Treasury interest rates at the time of grant. The weighted-average grant-date fair value per share of stock options granted in 2018, 2017 and 2016 was $20.01, $16.87 and $16.65, respectively. The fair value of each stock option during 2018, 2017, and 2016 was estimated on the grant date using the Black-Scholes option-pricing model with the following assumptions:
|  | 2018 |  | 2017 |  | 2016
Risk free interest rate |  | 2.15% | - | 2.82% |  | 1.60% | - | 1.86% |  | 0.94% | - | 1.55%
Expected volatility |  | 37.12% | - | 45.61% |  | 38.74% | - | 44.31% |  | 47.33% | - | 51.61%
Expected life (years) |  | 4.0 | - | 4.5 |  |  | 4.0 |  |  |  | 4.5 |
Expected dividend yield |  |  | 0.00% |  |  |  | 0.00% |  |  |  | 0.00% |
Stock Options and Restricted Stock The following table sets forth share information for stock-based compensation awards granted and exercised during the period ended December 31, 2018 and 2017:
|  | Twelve Months Ended December 31,
|  | 2018 |  | 2017
Grants: |  |  |  |
Stock options |  |  | 199,970 |  |  |  | 440,688 |
RSAs |  |  | 64,578 |  |  |  | 26,306 |
RSUs |  |  | 15,457 |  |  |  | 9,970 |
Exercises: |  |  |  |  |  |  |  |
Stock options |  |  | 284,548 |  |  |  | 12,941 |
SARs |  |  | - |  |  |  | 5,000 |
The Company recorded $11.0 million, $5.8 million, and $3.4 million of stock-based compensation expense for the years ended December 31, 2018, 2017, and 2016, respectively, for stock options, SARs, RSAs and RSUs with corresponding tax benefits of $1.5 million, $0.4 million and $0.6 million, respectively. Upon the retirement of the Company’s former Chief Executive Officer on March 9, 2018, all of his outstanding stock-based compensation awards vested in full and became exercisable in accordance with their terms, resulting in a one -time expense of $6.2 million that was fully recognized during the three -month period ended March 31, 2018. The Company presents the expenses related to stock-based compensation awards in the same expense line items as cash compensation paid to each of its employees as follows:
|  | 2018 |  | 2017 |  | 2016
Cost of product revenue |  | $ | (160 | ) |  | $ | 439 |  |  | $ | 148 |
Research & development |  |  | 851 |  |  |  | 564 |  |  |  | 467 |
Selling, general & administrative |  |  | 10,355 |  |  |  | 4,804 |  |  |  | 2,777 |
Total stock-based compensation expense |  | $ | 11,046 |  |  | $ | 5,807 |  |  | $ | 3,392 |
The decrease in stock-based compensation expense within the cost of product revenue line item for the year ended December 31, 2018 is due to forfeitures associated with unvested stock option awards from the resignation of a former executive. The combined stock options and SARs activity for the year ended December 31, 2018 is as follows:
|  | 2018
|  | Number of Shares |  | Weighted Average Exercise Price Per Share
Options and SARs outstanding at beginning of year |  |  | 1,327,200 |  |  | $ | 33.70 |
Granted |  |  | 199,970 |  |  | $ | 58.11 |
Cancelled |  |  | (104,629 | ) |  | $ | 50.19 |
Expired |  |  | (1,079 | ) |  | $ | 46.49 |
Exercised |  |  | (284,548 | ) |  | $ | 10.14 |
Options and SARs outstanding at end of year |  |  | 1,136,914 |  |  | $ | 42.06 |
All the 1,136,914 stock options and SARs outstanding at December 31, 2018 are vested or are expected to vest, with a weighted-average exercise price of $42.06 as well as an aggregate intrinsic value of $3.7 million. The weighted average remaining contractual term of the vested and expected to vest stock options and SARs was 5.0 years as of December 31, 2018. As of December 31, 2018, total unrecognized compensation costs related to non-vested stock options and SARs was approximately $4.4 million and is expected to be recognized over a weighted average period of 2.4 years. The exercisable options and SARs at December 31, 2018 are as follows:
|  | Number Outstanding |  | Weighted Avg Exercise Price |  | Weighted Average Remaining Term (in years)
Incentive stock options |  |  | 139,674 |  |  | $ | 24.53 |  |  |  | 4.1 |
Non-qualified stock options |  |  | 453,790 |  |  | $ | 40.74 |  |  |  | 3.2 |
Performance awards |  |  | 100,963 |  |  | $ | 40.72 |  |  |  | 3.1 |
Stock appreciation rights |  |  | 35,250 |  |  | $ | 6.36 |  |  |  | 1.1 |
The total intrinsic value of stock options and SARs exercised was $8.5 million, $0.5 million and $2.1 million for the years ended December 31, 2018, 2017 and 2016, respectively. The total fair value of stock options and SARs vested during the years ended December 31, 2018, 2017 and 2016 was approximately $6.7 million, $2.1 million and $1.3 million, respectively. The RSA and RSU activity for the year ended December 31, 2018 is as follows:
|  | 2018
|  | Number of Shares |  | Weighted Average Grant Date Fair Value
Unvested at Beginning of year |  |  | 229,226 |  |  | $ | 42.47 |
Granted |  |  | 80,035 |  |  | $ | 58.84 |
Cancelled |  |  | (126,946 | ) |  | $ | 42.47 |
Vested/Released |  |  | (123,232 | ) |  | $ | 50.80 |
Unvested at end of year |  |  | 59,083 |  |  | $ | 47.26 |
The total fair value of RSAs and RSUs vested during the years ended December 31, 2018, 2017 and 2016 was $6.8 million, $2.3 million and $1.0 million. The weighted-average grant-date fair value of RSAs and RSUs granted during the years ended December 31, 2018, 2017 and 2016 was $58.84, $52.03 and $38.11, respectively.

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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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -URI http://asc.fasb.org/topic&trid=2228938 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 50 -URI http://asc.fasb.org/subtopic&trid=2208855 + Details
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