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Stock-Based Compensation
 3 Months Ended
Mar. 31, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Stock-Based Compensation
Stock-Based Compensation
Effective February 2003, the Company implemented the 2003 Equity Incentive Plan (2003 Plan), and it was amended and approved by the Company's stockholders in 2005. The 2003 Plan originally allowed for the grant of awards in respect of an aggregate of 2,051,644 shares of the Company's common stock. Between 2006 and 2012, the maximum number of shares of common stock authorized to be issued by the Company under the 2003 Plan was increased to 4,336,730. Stock options granted under the 2003 Plan may be either incentive stock options as defined by the Internal Revenue Code (IRC), or non-qualified stock options.
In 2013, the 2003 Plan was terminated, and no further awards may be issued under the plan. Any shares of common stock subject to awards under the 2003 Plan that expire, terminate, or are otherwise surrendered, canceled, forfeited or repurchased without having been fully exercised, or resulting in any common stock being issued, will become available for issuance under the Company's 2013 Stock Incentive Plan (2013 Plan), up to a specified number of shares.  As of March 31, 2017, under the 2003 Plan, there were options to purchase an aggregate of 1,084,302 shares of common stock outstanding at a weighted average exercise price of $1.89 per share.
Under the provisions of the 2013 Plan, the number of shares of common stock reserved for issuance will automatically increase on January 1 of each year from January 1, 2014 through and including January 1, 2023, by the lesser of (a) 1,960,168 shares, (b) 4.0% of the total number of shares of common stock outstanding on December 31 of the preceding calendar year, or (c) the number of shares of common stock determined by the Board of Directors. During the three months ended March 31, 2017, the maximum number of shares of common stock authorized to be issued by the Company under the 2013 Plan was increased to 6,769,888.   As of March 31, 2017, there were options to purchase an aggregate of 3,659,216 shares of common stock outstanding at a weighted average exercise price of $24.90 per share under the 2013 Plan.
The following stock-based compensation amounts were recognized for the periods indicated (in thousands):
 
Three Months Ended March 31,
 
2017
 
2016
Research and development
$
1,673

 
$
1,396

General and administrative
1,788

 
1,605

Total stock-based compensation expense
$
3,461

 
$
3,001


Employee Stock Options
The fair value of each option award is estimated on the date of grant using the Black-Scholes option-pricing model using the assumptions in the following table for options issued during the period indicated:
 
Three Months Ended March 31,
 
2017
 
2016
Expected dividend yield
0%
 
0%
Expected volatility
67%
 
64%
Risk-free interest rate
2.3%
 
1.5% - 2.1%
Expected term
6.25 years
 
6.25 years

The following table summarizes stock option and restricted stock unit (RSU) activity during the three months ended March 31, 2017:
 
Shares
 
Weighted-
Average
Exercise Price
 
Weighted-Average
Remaining
Contractual Term
(Years)
 
Aggregate
Intrinsic
Value
(in thousands)
Outstanding, December 31, 2016
3,838,060

 
$
18.93

 
7.0
 

Granted
1,031,068

 
20.43

 

 

Exercised
(109,826
)
 
0.98

 

 

Forfeited or expired
(15,784
)
 
26.97

 

 

Outstanding, March 31, 2017
4,743,518

 
19.64

 
7.6
 
$
19,885

As of March 31, 2017:


 


 

 


Exercisable
2,397,928

 
15.08

 
6.2
 
18,531

Vested and expected to vest
4,495,867

 
19.37

 
7.5
 
19,697


The weighted-average grant-date fair value of options granted for the three months ended March 31, 2017 was $12.76. The total intrinsic value of options exercised during the three months ended March 31, 2017 was approximately $2.0 million, and the total cash received for options exercised was approximately $0.1 million. The total fair value of shares vested in the three months ended March 31, 2017 was approximately $3.1 million. As of March 31, 2017, the total unrecognized compensation expense related to non-vested stock options, net of related forfeiture estimates, was approximately $30.9 million, which the Company expects to recognize over a weighted-average period of approximately three years.