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SHARE BASED COMPENSATION
 12 Months Ended
Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]  
SHARE BASED COMPENSATION SHARE BASED COMPENSATION
Equity incentive plans:
The Company maintains the 2019 Equity Incentive Plan (the “2019 Plan”) and 2018 Omnibus Incentive Plan (the "2018 Plan"). As of December 31, 2022, 57,338 shares remain issuable under the 2019 Plan and 14,810 shares remain issuable under the 2018 Plan. In January 2022, the number of shares reserved under the 2018 Plan automatically increased by 41,666 shares of common stock pursuant to the terms of the 2018 Plan.
Employee Share Purchase Plan:
The Company adopted Foamix's Employee Share Purchase Plan ("ESPP") pursuant to which qualified employees (as defined in the ESPP) may elect to purchase designated shares of the Company’s common stock at a price equal to 85% of the lesser of the fair market value of the common stock at the beginning or end of each semi-annual share purchase period (“Purchase Period”). Employees are permitted to purchase the number of shares purchasable with up to 15% of the earnings paid (as such term is defined in the ESPP) to each of the participating employees during the Purchase Period, subject to certain limitations under Section 423 of the U.S. Internal Revenue Code.        
As of December 31, 2022, 116,463 shares remain available for grant under the ESPP.
During the year ended December 31, 2022 and 2021, 7,549 and 3,994 shares were issued to employees pursuant to the ESPP, respectively.
Options and Restricted Stock Units ("RSUs") granted to employees and directors:
In the years ended December 31, 2022 and 2021, the Company granted options and RSUs as follows:
Year ended December 31, 2022
Award amountExercise price rangeVesting periodExpiration
Employees and Directors:
Options48,861 
$5.62- $10.98
1 year - 4 years
10 years
RSU40,339 — 
4 years
— 
Year ended December 31, 2021
Award amountExercise price rangeVesting periodExpiration
Employees and Directors:
Options93,689 
$30.24- $199.44
1 year - 4 years
10 years
RSU53,934 — 
2 years - 4 years
— 
The fair value of options and RSUs granted to employees and directors during 2022 and 2021 was $0.8 million and $9.4 million, respectively. One share of Common Stock will be issued for each RSU that vests.
The fair value of RSUs granted to employees and directors is based on the share price on grant date.
The fair value of each option granted is estimated using the Black-Scholes option pricing method. The volatility is based on a combination of historical volatilities of companies in comparable stages as well as companies in the industry, by statistical analysis of daily share pricing model. The risk-free interest rate assumption is based on observed interest rates appropriate for the expected term of the options granted in dollar terms. The Company’s management uses the expected term of each option as its expected life. The expected term of the options granted represents the period of time that granted options are expected to remain outstanding.
The underlying data used for computing the fair value of the options are as follows:
Year ended December 31,
20222021
Fair value of stock option
$3.55-$7.49
$18.36-$121.50
Dividend yield0 %0 %
Expected volatility
73.70%-74.40%
68.38%-69.38%
Risk-free interest rate
2.20%-2.92%
0.50%-1.29%
Expected term6 years6 years
Modification of share-based compensation:
On November 10, 2019, Menlo Therapeutics Inc. ("Menlo") entered into a merger agreement (the "Merger Agreement") with Foamix Pharmaceuticals Ltd. ("Foamix") and Giants Merger Subsidiary Ltd., a wholly-owned subsidiary of Menlo ("Merger Sub"). On March 9, 2020, Merger Sub merged with and into Foamix, with Foamix surviving as a wholly-owned subsidiary of Menlo (the "Merger"). The combined company changed its name to VYNE in September 2020. Pursuant to the Merger, all outstanding options and RSUs granted by Foamix were exchanged for stock options and RSUs of Menlo’s common stock according to the exchange ratio set forth in the Merger Agreement. In addition, for each option and RSU the holder received a contingent stock right ("CSR"). This transaction was considered by the Company to be a modification under ASC 718, Compensation - Stock Compensation. The modification did not affect the remaining requisite service period. As a result of the modification, for outstanding options and RSUs granted to Foamix employees and consultants, the Company recorded immaterial incremental compensation expense. On April 6, 2020, pursuant to the terms of the agreement governing the CSRs, each CSR was converted into 1.2082 shares of Menlo common stock, resulting in an effective exchange ratio in the Merger of 1.8006 shares of Menlo common stock for each Foamix ordinary share. The conversion was considered by the company to be a modification under ASC 718. As a result of the modification, for outstanding options and RSUs granted to Foamix employees and consultants, the Company recorded incremental compensation of $0.2 million and $1.8 million for the years ended December 31, 2022 and December 31, 2021, respectively. As of December 31, 2022 there is $0.1 million of unrecognized incremental compensation expense related to the modification which will be amortized using a graded vesting method over the next 1 year.
Summary of outstanding and exercisable options and RSUs:
The following table summarizes the number of options outstanding for the year ended December 31, 2022, and related information:
Number of optionsWeighted Average Exercise Price
Outstanding at December 31, 2021224,664 $165.12 
Granted48,861 10.35 
Forfeited(26,234)102.28 
Expired(17,504)157.35 
Outstanding at December 31, 2022229,787 $138.92 
Exercisable at December 31, 2022145,272 $182.66 

The weighted average remaining contractual term of outstanding and exercisable options as of December 31, 2022, is 6.5 years and 5.5 years, respectively. Total unrecognized share based compensation for options at December 31, 2022 is $2.9 million, which is expected to be recognized over a weighted average period of 2.1 years.
There was no intrinsic value of outstanding and exercisable options as of December 31, 2022
The following table summarizes the number of RSUs outstanding for the year ended December 31, 2022:
Number of RSUs
Outstanding at December 31, 202170,133 
Awarded40,339 
Vested(13,375)
Forfeited(13,481)
Outstanding at December 31, 202283,616 
Total unrecognized compensation expense related to the unvested portion of the Company's RSUs at December 31, 2022 was $2.9 million, which is expected to be recognized over a weighted average period of 2.1 years.
Share-based compensation expenses:
The following table illustrates the effect of share-based compensation on the statements of operations:
Year ended December 31,
20222021
Research and development expenses1,230 1,714 
Selling, general and administrative3,419 5,243 
Discontinued Operations*(352)1,123 
4,297 8,080 
*Income from stock-based compensation is related to forfeitures.