Stock-based Compensation

9 Months Ended

Sep. 30, 2019

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock-based Compensation

8. Stock-based Compensation

During the three and nine months ended September 30, 2019 and 2018, the Company recognized the following stock-based compensation expense (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Research and development	$	6,262	$	3,999	$	17,137	$	12,081
General and administrative		5,081		4,056		15,063		9,879
Loss from equity method investment		3,430		1,012		5,467		3,256
Total	$	14,773	$	9,067	$	37,667	$	25,216

Stock option activity

The following table summarizes stock option activity for the nine months ended September 30, 2019 (intrinsic value in thousands):

	Stock Options			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (years)		Aggregate Intrinsic Value
Outstanding at December 31, 2018		6,689,311		$	25.42		8.3	$	68,572
Granted		2,136,873		$	37.23
Exercised		(475,062	)	$	12.03
Cancelled or forfeited		(337,020	)	$	31.50
Outstanding at September 30, 2019		8,014,102		$	29.10		8.0	$	119,011
Exercisable at September 30, 2019		3,544,643		$	21.65		7.1	$	76,945
Vested and expected to vest at September 30, 2019		8,014,102		$	29.10		8.0	$	119,011

The Company estimated the fair value of each stock option award using the Black-Scholes option-pricing model based on the following assumptions:

	Nine Months Ended September 30,
	2019			2018
Assumptions
Weighted-average expected volatility		69.2	%		71.9	%
Expected term (in years)		6.0			6.0
Risk-free interest rate		2.4	%		2.7	%
Expected dividend yield		0.0	%		0.0	%

As of September 30, 2019, total unrecognized compensation expense related to stock options was $93.3 million which the Company expects to recognize over a remaining weighted-average period of 2.8 years.

In May 2018, the Company modified the terms of certain options held by a departing employee. The modification resulted in $2.2 million in stock-based compensation expense recorded during the period.  In September 2019, the Company modified the terms of certain options held by non-employees.  The modifications resulted in $2.9 million in stock-based compensation expense recorded during the period.

Restricted stock activity

The following table summarizes restricted stock activity for the nine months ended September 30, 2019:  

	Restricted Stock			Weighted- Average Grant Date Fair Value
Unvested balance as of December 31, 2018		327,342		$	36.72
Granted		145,000			43.61
Vested		(69,091	)		15.07
Cancelled or forfeited		(23,000	)		41.64
Unvested balance as of September 30, 2019		380,251		$	42.98

As of September 30, 2019, total unrecognized compensation expense related to unvested restricted common shares was $10.5 million which the Company expects to recognize over a remaining weighted-average vesting period of 1.42 years.