In February 2020, the Company entered into a sales agreement with Credit Suisse Securities (USA) LLC, SVB Leerink LLC and Cantor Fitzgerald & Co., pursuant to which it may sell and issue shares of its common stock having an aggregate offering price of up to $250.0 million from time to time in transactions that are deemed to be “at-the-market offering” as defined in Rule 415(a)(4) under the Securities Act of 1933, as amended, or Securities Act.

During the first quarter of 2021, the Company sold 1.2 million shares of common stock under the sales agreement at a weighted average price of $81.06 per share and realized gross proceeds of $100.6 million.

In June 2020, the Company completed the sale of an aggregate of 6,325,000 shares of common stock in an underwritten public offering. Net proceeds from the offering were approximately $301.8 million after deducting underwriting discounts and commissions and offering expenses payable by the Company.

In June 2021, the Company’s stockholders approved the 2021 Long-Term Incentive Plan, or 2021 LTIP. Upon such approval, the Company’s Amended and Restated 2020 Long-Term Incentive Plan, or 2020 LTIP, was terminated. Notwithstanding such termination or the previous termination of its 2017 Long-Term Incentive Plan, 2013 Long-Term Incentive Plan, 2012 Long-Term Incentive Plan, 2009 Long-Term Incentive Plan, and 2006 Long-Term Incentive Plan, as amended, or, together with the 2020 LTIP, the Prior Plans, all outstanding awards under the Prior Plans continue to be governed under the terms of the Prior Plans. Since the Company’s stockholders approved the 2021 LTIP, the Compensation Committee of the Company’s Board of Directors has from time to time amended the 2021 LTIP to incorporate into the 2021 LTIP inducement equity awards granted to new employees of the Company or its subsidiary APD GmbH. The number of shares of common stock authorized for issuance under the 2021 LTIP may be increased by the

number of shares subject to any stock awards under the Prior Plans that are forfeited, expire or otherwise terminate without the issuance of such shares and would otherwise be returned to the share reserve under the Prior Plans but for their termination and as otherwise provided in the 2021 LTIP.

The aggregate number of shares of the Company’s common stock that initially could be issued pursuant to stock awards granted under the 2021 LTIP is 1,466,561 shares. Shares issued after the effective date of the 2021 LTIP pursuant to awards granted under the 2021 LTIP or any of the Company’s Prior Plans reduce the number of shares available for issuance under the 2021 LTIP by 1 share for every share issued.

Shares under the 2021 LTIP may be granted as incentive stock options, nonstatutory stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards and performance awards. Performance awards may be based on the achievement of operational, financial, research and development, collaboration and license arrangements and other performance metrics provided under the 2021 LTIP, such as total stockholder return, revenue, research, development and regulatory achievements and strategic and operational initiatives.

A total of 12,862,657 shares of the Company’s common stock were reserved for future issuance at December 31, 2021, pursuant to the 2021 LTIP and the Company’s Prior Plans, or collectively, its Equity Compensation Plans.


	Years Ended December 31,
	2021		2020		2019
Selling, general and administrative	$	36,884	$	33,919	$	25,686
Research and development	33,489		26,001		27,361
Total share-based compensation expense	$	70,373	$	59,920	$	53,047


	Years Ended December 31,
	2021		2020		2019
Stock options	$	46,946	$	54,710	$	36,393
Performance-based restricted stock units	12,752		1,804		15,351
Restricted stock units	9,664		2,716		1,213
Employee stock purchase plan	1,011		690		90
Total share-based compensation expense	$	70,373	$	59,920	$	53,047

Stock options granted under the 2021 LTIP generally vest over four years with 25% of the shares subject to each option vesting on the first anniversary of the grant date and the remainder of the shares vesting monthly over the following three years in equal installments and, to the extent vested, are exercisable for up to seven years from the date of grant.


	Options	Weighted- Average Exercise Price		Weighted- Average Contractual Life (in years)	Intrinsic Value(1)
Outstanding at January 1, 2021	8,699	$	40.33
Granted	1,808	73.27
Exercised	(1,402)	32.44
Forfeited/cancelled/expired	(1,104)	53.72
Outstanding at December 31, 2021	8,001	$	47.31	4.27	$	365,079
Exercisable at December 31, 2021	4,576	$	38.10	3.34	$	250,968

______________________

(1)The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the estimated fair value of the common stock for the options that were in the money at December 31, 2021.

As of December 31, 2021, there was approximately $81.1 million of unrecognized compensation expense related to unvested stock options that is expected to be recognized over a weighted-average period of 2.5 years.

The recipient of a restricted stock award has all rights of a stockholder at the date of grant, subject to certain restrictions on transferability and a risk of forfeiture. Restricted stock unit awards generally vest over one or four years from the date of grant. Neither the exercise price of an option nor the grant price of a stock appreciation right may be less than 100% of the fair market value of the common stock on the date such equity award is granted, except in specified situations. The 2021 LTIP prohibits option and stock appreciation right repricings (other than to reflect stock splits, spin-offs or certain other corporate events) without stockholder approval.

Restricted stock awards, restricted stock unit awards and performance awards are share awards that, upon vesting, will deliver to the holder shares of the Company’s common stock. The following table summarizes the Company’s RSU activity during the year ended December 31, 2021, in thousands (except grant date fair value data):


	Number of Shares	Weighted- Average Grant Date Fair Value
Non-vested at December 31, 2020	243	$	54.00
Granted	696	72.66
Released	(77)	53.43
Forfeited/cancelled	(144)	68.29
Non-vested at December 31, 2021	718	$	69.29

As of December 31, 2021, there was approximately $41.5 million of unrecognized compensation expense related to unvested RSUs that is expected to be recognized over a remaining weighted-average period of 3.1 years.

In 2021, a total of 216,772 target Performance-Based Restricted Stock Units, or PRSUs, were granted to employees in a company-wide grant. The PRSUs vest upon the closing price of the Company’s common stock, or the Closing Price, reaching certain price thresholds during the three-year performance period ending February 2024, or the Performance Period, and the participant’s subsequent satisfaction of a continuing service requirement of generally 90 calendar days. If, on five consecutive trading days or ten non-consecutive trading days during the Performance Period, the Closing Price equals or exceeds $120.00, $130.00 or $145.00, and the participant thereafter satisfies the continuing service requirement, then the PRSUs are deemed vested at 50%, 100% or 200%, respectively, of the participant’s respective target

PRSU amount. The shares may be issued following achievement of each price threshold, and the maximum number of common shares that may be issued pursuant to each PRSU grant equals 200% of the target number of PRSUs granted. As these awards contain a market condition, the Company used a Monte Carlo simulation model to estimate the grant-date fair value, which totaled $22.0 million. The grant-date fair value is recognized as compensation expense over the requisite service period of approximately 1.2 years which was derived from the Monte Carlo simulation; no compensation expense is recognized for service not provided upon separation from the Company. There is no adjustment of compensation expense recognized for service performed regardless of the number of PRSUs, if any, that ultimately vest.

Performance awards are share awards that, upon vesting, will deliver to the holder shares of the Company’s common stock. The following table summarizes the Company’s PRSU activity during the year ended December 31, 2021, in thousands (except grant date fair value data):


	Number of Shares	Weighted- Average Grant Date Fair Value
Non-vested at January 1, 2021	273	$	27.97
Granted(1)	434	50.82
Released	(273)	27.97
Forfeited/cancelled	(67)	52.77
Non-vested at December 31, 2021	367	$	50.46

_____________________

(1)Pursuant to the terms of the awards granted, the actual number of awards earned could range between 0% and 200% of the above number of awards granted. The amount disclosed represents PRSU grants at maximum payout.

In June 2019, the Company’s stockholders approved the 2019 Employee Stock Purchase Plan, or 2019 ESPP. Under the 2019 ESPP, substantially all employees can elect to have up to 15% of their annual compensation withheld to purchase up to 2,000 shares of common stock per purchase period, subject to certain limitations. The shares of common stock can be purchased over an offering period with a maximum duration of 12 months and at a price of not less than 85% of the lesser of the fair market value of the common stock on (i) the first trading day of the applicable offering period or (ii) the last trading day of the applicable six-month purchase period. Under applicable accounting guidance, the 2019 ESPP is considered a compensatory plan.

During the year ended December 31, 2021 and 2020, a total of 52,180 and 64,456 shares, respectively, were purchased by the Company’s employees under the 2019 ESPP. There were no ESPP purchases in 2019.