In July 2018, the Company adopted the 2018 Incentive Award Plan (the “2018 Plan”). Under the 2018 Plan, which expires in July 2028, the Company may grant equity-based awards to individuals who are employees, officers, directors or consultants of the Company. Options issued under the 2018 Plan, will generally expire ten years from the date of grant and vest over a four-year period. As of June 30, 2019, 2,331,772 shares were available for future issuance under the 2018 Plan.

The 2018 Plan contains a provision that allows annual increases in the number of shares available for issuance on the first day of each calendar year through January 1, 2028 in an amount equal to the lesser of: (i) 5% of the aggregate number of shares of the Company’s common stock outstanding on December 31 of the immediately preceding calendar year, or (ii) such lesser amount determined by the Company.

In February 2015, the Company adopted the Crinetics Pharmaceuticals, Inc. 2015 Stock Incentive Plan (the “2015 Plan”), which provided for the issuance of equity awards to the Company’s employees, members of its board of directors and consultants. In general, options issued under this plan vest over four years and expire after 10 years. Subsequent to the adoption of the 2018 Plan, no additional equity awards can be made under the 2015 Plan.

Certain awards under the 2015 Plan allowed for exercise prior to vesting. Shares issued under such early-exercise provisions are subject to repurchase by the Company until they become fully vested. As of June 30, 2019, 49,718 unvested shares issued under early-exercise provisions were subject to repurchase by the Company. The condensed consolidated balance sheet reflects an unvested stock liability of $0.1 million as of June 30, 2019.

In July 2018, the Company adopted the 2018 Employee Stock Purchase Plan (the “ESPP”). The ESPP permits participants to purchase common stock through payroll deductions of up to 20% of their eligible compensation. As of June 30, 2019, an aggregate of 447,061 shares of common stock were available for issuance under the ESPP.

The ESPP contains a provision that allows annual increases in the number of shares available for issuance on the first day of each calendar year through January 1, 2028 in an amount equal to the lesser of: (i) 1% of the aggregate number of shares of the Company’s common stock outstanding on December 31 of the immediately preceding calendar year, or (ii) such lesser amount determined by the Company.

Stock option activity during the six months ended June 30, 2019 under both of the 2015 Plan and the 2018 Plan is as follows:

				Weighted-		Weighted-		Aggregate
				Average		Average		Intrinsic
	Options			Exercise		Remaining		Value
	Outstanding			Price		Term		(000’s)
Balance at December 31, 2018		2,339,157		$	6.40
Granted		773,125		$	24.84
Cancelled		(9,119	)	$	9.28
Exercised		(63,014	)	$	1.39
Balance at June 30, 2019		3,040,149		$	11.18		8.8	$	42,418
Exercisable at June 30, 2019		776,012		$	5.39		8.2	$	15,224

The aggregate intrinsic value in the above table is calculated as the difference between the closing price of our common stock at June 30, 2018 and the exercise price of stock options that had strike prices below the closing price. The total intrinsic value of options exercised during the first six months of 2019 was $1.5 million.

The Company utilizes the Black-Scholes option pricing model to value awards under its equity plans. The following table summarizes the weighted average assumptions used to estimate the fair value of stock options granted to employees under the Company’s stock option plans and the shares purchasable under the ESPP during the periods presented:

Stock Option Plans	2019	2018
Expected life of option	5.9 years	6.0 years
Volatility	78%	70%
Risk free interest rate	2.4%	2.8%
Dividend yield	—%	—%

Employee Stock Purchase Plan	2019	2018
Expected life of option	1.3 years	N/A
Volatility	62%	N/A
Risk free interest rate	2.3%	N/A
Dividend yield	—%	N/A

The key assumptions used in determining the fair value of equity awards, and the Company’s rationale, were as follows: (i) Expected term - the expected term represents the period that options are expected to be outstanding and has been estimated using the simplified method, which is an average of the contractual option term and its vesting period; (ii) Expected volatility - the expected volatility assumption is based on volatilities of a peer group of similar companies in the biotechnology industry whose share prices are publicly available; (iii) Risk-free interest rate - the risk-free interest rate is based on the U.S. Treasury yield in effect at the time of grant for zero coupon U.S. Treasury notes with maturities that approximate the expected terms of awards; and (iv) Expected dividend yield - the expected dividend yield assumption is zero as the Company has never paid cash dividends and has no present intention to do so in the near future.

The weighted-average fair value of stock options granted to employees during the first half of 2019 and 2018 was $16.95 and $4.02 per share, respectively.

Stock-based compensation expense for the equity awards issued by the Company to employees and non-employees for the periods presented below was as follows (in thousands):

	Three months ended June 30,				Six months ended June 30,
	2019		2018		2019		2018
Included in research and development	$	839	$	130	$	1,378	$	291
Included in general and administrative		742		141		1,231		407
Total	$	1,581	$	271	$	2,609	$	698

Unrecognized stock-based compensation cost related to option awards was $20.0 million as of June 30, 2019, which is expected to be recognized over a remaining weighted-average period of approximately 2.8 years.

Unrecognized stock-based compensation cost related to the ESPP was $0.5 million as of June 30, 2019, which is expected to be recognized over a remaining weighted-average period of approximately 1.2 years.