During the three months ended March 31, 2017, the Company granted 32,500 restricted stock units to certain employees of the Company. The Company did not grant restricted stock units prior to January 1, 2017. These restricted stock units vested ratably over two years, with cliff vesting of 50% at both the one-year and two-year anniversary of the grant date, which was in February 2018 and February 2019, respectively. The fair value of restricted stock units that vested during the nine months ended September 30, 2019 and 2018 was $2.0 million and $2.6 million, respectively.

During the three months ended March 31, 2018, the Company granted 33,600 performance restricted stock units to certain employees of the Company. The milestones for these grants were not met, and accordingly, these grants were cancelled.

During the three months ended June 30, 2018, the Company granted 37,800 performance restricted stock units to certain employees of the Company. During the three and nine months ended September 30, 2019, the Company granted 16,258 and 386,714 performance restricted stock units, respectively, to employees of the Company. These performance restricted stock units are related to the achievement of certain clinical and regulatory development milestones related to product candidates and commercial milestones. Recognition of stock-based compensation expense associated with these performance restricted stock units commences when the performance condition is considered probable of achievement, using management’s best estimates, which consider the inherent risk and uncertainty regarding the future outcomes of the milestones.

During the three months ended September 30, 2019, one milestone was achieved. This milestone represents 18% of the performance restricted stock units that were granted during the nine months ended September 30, 2019.

The fair value of performance restricted stock units that vested during the three and nine months ended September 30, 2019 was $11.1 million. No performance restricted stock units vested during the nine months ended September 30, 2018.

	Shares
Outstanding as of December 31, 2018		82,700
Granted		386,714
Vested		(82,128	)
Forfeited		(52,914	)
Outstanding as of September 30, 2019		334,372

On July 2, 2014, the stockholders of the Company approved the 2014 Stock Option and Incentive Plan (the “2014 Stock Option Plan”), which became effective immediately prior to the completion of the Company’s IPO. The 2014 Stock Option Plan provides for the grant of restricted stock awards, restricted stock units, incentive stock options and non-statutory stock options. The 2014 Stock Option Plan replaced the Company’s 2011 Stock Option and Grant Plan (the “2011 Stock Option Plan”). The Company no longer grants stock options or other awards under its 2011 Stock Option Plan, but any options or awards outstanding under the 2011 Stock Option Plan remain outstanding and effective.

The 2014 Stock Option Plan provides for an annual increase, to be added on the first day of each fiscal year, by up to 4% of the Company’s outstanding shares of common stock as of the last day of the prior year. On January 1, 2019, 1,875,530 shares of common stock, representing 4% of the Company’s outstanding shares of common stock as of December 31, 2018, were added to the 2014 Stock Option Plan.

On December 15, 2016, the Board of Directors of the Company (the “Board”) approved the 2016 Inducement Equity Plan (the “2016 Stock Option Plan”). The 2016 Stock Option Plan provides for the grant of equity awards to individuals who have not previously been an employee or a non-employee director of the Company to induce them to accept employment and to provide them with a proprietary interest in the Company. On September 20, 2018, the Board amended the 2016 Stock Option Plan to increase the total number of shares reserved for issuance under such plan by 1,200,000 shares.

As of September 30, 2019, the total number of shares reserved under all equity plans was 10,712,317, and 2,801,948 shares were available for future issuance under such plans.

During the nine months ended September 30, 2018, the Company granted 524,003 options to employees to purchase shares of common stock that contain performance-based vesting criteria, primarily related to the achievement of certain clinical and regulatory development milestones related to product candidates and a commercial milestone. Recognition of stock-based compensation expense associated with these performance-based stock options commences when the performance condition is considered probable of achievement, using management’s best estimates, which consider the inherent risk and uncertainty regarding the future outcomes of the milestones.

During the three and nine months ended September 30, 2019, the Company granted no options to employees to purchase shares of common stock that contain performance-based vesting criteria.

During the three months ended March 31, 2019, the achievement of one unmet commercial milestone that is the criteria for vesting of performance-based stock options was considered probable, and therefore $14.2 million of stock-based compensation expense was recognized related to these awards for the three months ended March 31, 2019. Stock options with this milestone were granted during the years ended December 31, 2018 and 2017. During the three months ended June 30, 2019, this commercial milestone was achieved. This milestone represents 20% and 33% of the performance-based option grants that were made during the years ended December 31, 2018 and 2017, respectively. During the three months ended June 30, 2019, the Company recognized stock-based compensation expense related to this milestone of $2.1 million. During the six months ended June 30, 2019, the Company recognized stock-based compensation expense related to this milestone of $16.3 million.

During the three months ended June 30, 2018, a performance milestone was achieved under a stock option granted to a consultant. The milestone was related to the consummation of a licensing or corporate partnering arrangement. During the three months ended June 30, 2018, the Company recognized stock-based compensation expense related to this milestone of $6.9 million.

As of September 30, 2019 and 2018, for grants that were outstanding, the achievement of the milestones that are the criteria for vesting of performance-based stock options that had not been met was considered not probable, and therefore no expense had been recognized related to these awards for the nine months ended September 30, 2019 and 2018.

Stock-based compensation expense recognized during the three and nine months ended September 30, 2019 and 2018 was as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
	(in thousands)
Research and development	$	17,111	$	13,997	$	51,528	$	34,991
Selling, general and administrative		26,558		11,481		71,024		35,332
	$	43,669	$	25,478	$	122,552	$	70,323

Stock-based compensation expense recognized during the three and nine months ended September 30, 2019 and 2018 by award type was as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
	(in thousands)
Stock options	$	32,119	$	25,015	$	109,963	$	69,023
Restricted stock units		10,934		164		10,992		487
Employee stock purchase plan		616		299		1,597		813
	$	43,669	$	25,478	$	122,552	$	70,323

The weighted average grant date fair value per share of stock options granted under the Company’s stock option plans during the nine months ended September 30, 2019 and 2018 was $99.49 and $113.12, respectively.

	Shares			Weighted Average Exercise Price		Weighted Average Remaining Life (in years)		Aggregate Intrinsic Value (in thousands)
Outstanding as of December 31, 2018		7,530,767		$	93.22		8.03	$	227,447
Granted		1,428,948			157.95
Exercised		(971,203	)		43.20
Forfeited		(412,515	)		134.99
Outstanding as of September 30, 2019		7,575,997		$	109.56		7.78	$	327,724
Exercisable as of September 30, 2019		3,473,244		$	75.59		6.79	$	251,232

At September 30, 2019, the Company had unrecognized stock-based compensation expense related to its unvested service-based stock option awards of $285.0 million, which is expected to be recognized over the remaining weighted average vesting period of 2.54 years.

The intrinsic value of stock options exercised during the nine months ended September 30, 2019 and 2018 was $115.2 million and $93.0 million, respectively.

At September 30, 2019, 490,675 performance-based stock options were both outstanding and unvested, and the total unrecognized stock-based compensation expense related to those awards was $35.1 million.