Share-based compensation

3 Months Ended

Mar. 31, 2024

Share-based compensation

Share-based compensation

11. Share-based compensation

2020 Equity Incentive Plan

In September 2020, the Company adopted the 2020 Equity Incentive Plan, or the 2020 Plan, which supersedes all prior equity incentive plans. No further awards will be granted under the 2018 Equity Incentive Plan, or 2018 Plan. Awards forfeited, cancelled, or repurchased from the above plans are returned to the pool of shares of common stock available for issuance under the 2020 Plan. On January 1, 2024, the shares of common stock authorized for issuance under the 2020 Plan increased by 1,730,071 shares. As of March 31, 2024, there were 4,398,174 shares available for issuance under the 2020 Plan.

On October 2, 2023, the Morphimmune 2020 Equity Incentive Plan, or the Morphimmune Plan, (or collectively with the 2020 Plan, the Plans), was assumed by the Company in conjunction with the Merger (Note 7). There were 929,702 shares available for issuance under the Morphimmune Plan as of March 31, 2024.

2020 Employee Stock Purchase Plan

The Company adopted the 2020 Employee Stock Purchase Plan, or ESPP, in September 2020. On January 1, 2024, the shares of common stock authorized for issuance under the ESPP increased by 432,518 shares. As of March 31, 2024, there were 906,251 shares available for issuance under the ESPP. No shares of common stock have been issued under the ESPP as of March 31, 2024.

Stock options

A summary of option activity under the Plans during the three months ended March 31, 2024 is as follows:

				Weighted
		Weighted		average	Aggregate
		average		remaining	Intrinsic
	Number of	exercise price		contractual	Value
	shares	per share		term (years)	(in thousands)
Outstanding at December 31, 2023	7,978,291	$	6.15	8.62	$	45,360
Granted	1,129,434		19.86
Exercised	(137,112)		6.22
Forfeited	(344,339)		8.26
Expired	(94,591)		20.86
Outstanding at March 31, 2024	8,531,683	$	7.71	8.33	$	146,173
Exercisable at March 31, 2024	3,115,238	$	5.38	6.62	$	61,212

Aggregate intrinsic value in the above table is calculated as the difference between the exercise price of the options and the Company’s fair value of its common stock as of period end.

The weighted-average grant date fair value of stock options granted during the three months ended March 31, 2024 and 2023 was $14.62 and $4.18 per share, respectively. The aggregate intrinsic value of options exercised during the three months ended March 31, 2024 was $2.5 million. No options were exercised during the three months ended March 31, 2023.

The weighted average assumptions used in the Black-Scholes option-pricing model for stock options granted were:

	Three Months Ended March 31,
	2024			2023
Expected volatility		84.1	%		87.9	%
Risk-free interest rate		4.1	%		3.9	%
Expected term (in years)		6.06			5.96
Expected dividend yield		—	%		—	%

Share-based compensation expense recorded in the condensed consolidated statements of operations and comprehensive loss is as follows (in thousands):

	Three Months Ended March 31,
	2024		2023
Research and development	$	383	$	430
General and administrative		1,776		794
Total share-based compensation expense	$	2,159	$	1,224

Unrecognized share-based compensation related to stock options was $37.1 million as of March 31, 2024 and is expected to be recognized over a weighted average period of 1.9 years.