Accounting for Shared-Based Payments (Tables)

6 Months Ended

Jun. 30, 2013

Accounting for Shared-Based Payments

Schedule of stock-based compensation expense

Stock-based compensation has been recognized in operating results as follow: (dollars in thousands)

	Three Months Ended June 30,				Six Months Ended June 30				November 15, 2005 (inception) to
	2013		2012		2013		2012		June 30, 2013
Employees—included in research and development	$	278	$	146	$	555	$	262	$	2,156
Employees—included in general and administrative	331		100		781		194		2,190
Subtotal employee stock based compensation	609		246		1,336		456		4,346
Non-employees—included in research and development	2		—		137		—		433
Non-employees—included in general and administrative	300		108		695		336		2,873
Subtotal non-employee stock based compensation	302		108		832		337		3,306
Total stock-based compensation expense	$	911	$	354	$	2,168	$	792	$	7,652

Schedule of weighted-average assumptions used to estimate fair value of stock option awards using the Black-Scholes option valuation model

	Six Months Ended June 30, 2013	Six Months Ended June 30, 2012
Risk-free interest rate	0.41%-1.11%	0.97%-1.50%
Dividend yield	—	—
Expected volatility	60%	60%
Expected term (in years)	6 years	6 years

Summary of stock option activity and of changes in stock options outstanding under the Plan

	Number of Options		Exercise Price Per Share		Weighted Average Exercise Price Per Share		Intrinsic Value (in thousands)		Weighted Average Remaining Contractual Term
Balance outstanding, December 31, 2012	9,734,268		$	0.50 — 5.20	$	2.75	$	24,482	6.45 years
Granted	1,589,316	(a)	$	0.44 — 20.01	$	7.62
Exercised	(61,787	)	$	0.44 — 4.28	$	1.91
Forfeited	(798,734	)(a)	$	4.42 — 12.51	$	5.85
Balance outstanding, June 30, 2013	10,463,063	(a)	$	0.44-20.01	$	3.25	$	16,649	7.2 years
Exercisable at June 30, 2013	3,591,494	(a)	$	0.44-20.01	$	2.68	$	8,472	5.5 years

(a) Includes 1,221,316 stock options issued to former Callisto option holders under the terms of Callisto Synergy Merger Agreement dated January 17, 2013, of which 711,293 stock options are vested and 298,734 stock options expired were forfeited through June 30, 2013.