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Stock-Based Compensation
 3 Months Ended
Mar. 31, 2022
Share-based Payment Arrangement [Abstract]  
Stock-Based Compensation Stock-Based Compensation
Total stock-based compensation was as follows:
Three Months Ended
March 31,
20222021
(in thousands)
Cost of product revenue$653 $138 
Research and development2,238 1,167 
Sales and marketing3,932 2,057 
General and administrative2,687 1,777 
Total stock-based compensation$9,510 $5,139 
Stock-based compensation of $0.3 million was capitalized into inventory for the three months ended March 31, 2022 and March 31, 2021. Stock-based compensation capitalized into inventory is recognized as cost of product revenue when the related product is sold.
2009 Equity Incentive Plan and 2019 Equity Incentive Plan
On June 17, 2009, the Company adopted the 2009 Equity Incentive Plan (the “2009 Plan”) under which the Company's Board of Directors (the "Board") had the authority to issue stock options to employees, directors and consultants.
In February 2019, the Company adopted the 2019 Equity Incentive Plan (the “2019 Plan”), which became effective in connection with the initial public offering (the “IPO”). As a result, effective as of March 6, 2019, the Company may not grant any additional awards under the 2009 Plan. The 2009 Plan will continue to govern outstanding equity awards granted thereunder. The Company initially reserved 2,000,430 shares of common stock for the issuance of a variety of awards under the 2019 Plan, including stock options, stock appreciation rights, awards of restricted stock and awards of restricted stock units ("RSUs"). In addition, the number of shares of common stock reserved for issuance under the 2019 Plan will automatically increase on the first day of January for a period of up to ten years, which commenced on January 1, 2020, in an amount equal to 3% of the total number of shares of the Company’s capital stock outstanding on the last day of the preceding year, or a lesser number of shares determined by the Board. As of March 31, 2022, there were 4,809,252 shares available for issuance under the 2019 Plan.
Stock Options
Option activity under the 2009 Plan and 2019 Plan is set forth below:
Shares
Available
for Grant		Number
of Shares		Weighted-
Average
Exercise
Price Per
Share		Weighted-
Average
Remaining
Term		Aggregate
Intrinsic
Value
(in years)(in thousands)
Balance, December 31, 20213,745,216 1,524,985 $6.01 5.76$262,793 
Awards authorized1,063,334 — 
Options exercised— (54,913)7.10 
Options cancelled702 (702)13.19 
Balance, March 31, 20224,809,252 1,469,370 $5.96 5.40$295,930 
Vested and exercisable, March 31, 20221,325,201 $5.37 5.25$267,682 
Vested and expected to vest, March 31, 20221,469,370 $5.96 5.40$295,930 
Restricted Stock Units
RSUs are share awards that entitle the holder to receive freely tradable shares of the Company’s common stock upon vesting. The RSUs cannot be transferred and the awards are subject to forfeiture if the holder’s employment terminates prior to the release of the vesting restrictions. RSUs generally vest over a four-year period with straight-line annual vesting, provided the employee remains continuously employed with the Company. The fair value of RSUs is equal to the closing price of the Company’s common stock on the grant date.
In February 2022, the Company granted performance-based restricted stock units ("PRSUs") to certain key executives. The vesting of these PRSUs is dependent on the achievement of certain performance targets related to the Company’s compound annual growth rate of revenue over a two or three year performance period, provided the executives remain employed with the Company at the time of vesting. The number of PRSUs that vest will vary from 0% to 200% of the target which will be determined based on the level of performance attained for each performance period. The fair value of these PRSUs is equal to the closing price of the Company’s common stock on the grant date. Compensation cost for PRSUs is recognized over the requisite service period based on the expected achievement of performance targets.
RSU and PRSU activity under the 2019 Plan is set forth below. Grant activity for all PRSUs are disclosed at target (100%):
Restricted Stock UnitsPerformance-Based Restricted Stock Units
Number
of Shares		Weighted-
Average
Grant Date
Fair Value
Per Share		Number
of Shares		Weighted-
Average
Grant Date
Fair Value
Per Share
Balance, December 31, 20211,156,683 $93.27 — $— 
RSUs granted214,988 157.46 35,105 155.03
RSUs forfeited(22,864)146.73 — — 
RSUs vested(210,835)80.63 — — 
Balance, March 31, 20221,137,972 $106.67 35,105 $155.03 
Employee Stock Purchase Plan
In February 2019, the Company adopted the 2019 Employee Stock Purchase Plan (“ESPP”), which became effective in connection with the IPO on March 6, 2019. The Company initially reserved 300,650 shares of common stock for purchase under the ESPP. Each offering under the ESPP to Company employees to purchase stock under the ESPP begins on each September 1 and March 1 and ends on the following February 28 or 29 and August 31, respectively. On each purchase date, which falls on the last date of each offering period, ESPP participants will purchase shares of common stock at a price per share equal to 85% of the lesser of (1) the fair market value per share of the common stock on the offering date or (2) the fair market value of the common stock on the purchase date. The occurrence and duration of offering periods under the ESPP are subject to the determinations of the Company’s Compensation Committee of the Board, in its sole discretion.
The fair value of the ESPP shares is estimated using the Black-Scholes option pricing model. The Company recorded $0.4 million and $0.3 million of stock-based compensation expense related to the ESPP for the three months ended March 31, 2022 and 2021, respectively. At March 31, 2022, a total of 1,212,769 shares were available for issuance under the ESPP.