Share-Based Compensation

3 Months Ended

Jun. 30, 2019

Share-based Payment Arrangement [Abstract]

(A) Myovant 2016 Equity Incentive Plan

In June 2016, the Company adopted its 2016 Equity Incentive Plan, or as amended, the 2016 Plan, under which 4.5 million common shares were originally reserved for issuance. Pursuant to the “evergreen” provision contained in the 2016 Plan, the number of common shares reserved for issuance under the 2016 Plan automatically increases on April 1 of each year, commencing on (and including) April 1, 2017 and ending on (and including) April 1, 2026, in an amount equal to 4% of the total number of shares of capital stock outstanding on March 31 of the preceding fiscal year, or a lesser number of shares as determined by the Company’s board of directors. On April 1, 2019, the number of common shares authorized for issuance increased automatically by 2.9 million shares in accordance with the evergreen provision of the 2016 Plan. As of June 30, 2019, a total of 3.2 million common shares were available for future issuance under the 2016 Plan.

The Company’s employees, directors, officers and consultants are eligible to receive non-qualified and incentive stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, and other share awards under the 2016 Plan.

(B) Stock Options

A summary of stock option activity under the Company’s 2016 Plan is as follows:



	Number of Options
Options outstanding at March 31, 2019	5,396,465
Granted	1,849,560
Exercised	(33,461	)
Forfeited	(127,227	)
Options outstanding at June 30, 2019	7,085,337
Options vested and expected to vest at June 30, 2019	7,085,337
Options exercisable at June 30, 2019	2,013,917

A summary of restricted stock award and restricted stock unit activity under the Company’s 2016 Plan is as follows:



	Number of Shares
Unvested balance at March 31, 2019	956,066
Granted	—
Vested	(71,452	)
Unvested balance at June 30, 2019	884,614

(D) Share-Based Compensation Expense

Share-based compensation expense was as follows (in thousands):



	Three Months Ended June 30,
	2019		2018
Share-based compensation expense recognized as:
R&D expenses	$	2,548	$	1,561
G&A expenses	3,904		2,683
Total	$	6,452	$	4,244

Share-based compensation expense is included in R&D and G&A expenses in the accompanying unaudited condensed consolidated statements of operations consistent with the grantee’s salary. Share-based compensation expense presented in the table above includes share-based compensation expense allocated to the Company by RSL of less than $0.1 million and $0.2 million for the three months ended June 30, 2019 and 2018, respectively. Total unrecognized share-based compensation expense was approximately $65.2 million as of June 30, 2019 and is expected to be recognized over a weighted-average period of approximately 3.09 years.

(E) RSL RSUs

The Company’s Principal Executive Officer was granted 66,845 RSL RSUs during the fiscal year ended March 31, 2017. These RSUs will vest to the extent certain RSL performance criteria are achieved and certain RSL liquidity conditions are satisfied within specified years of the grant date, provided that the Company’s Principal Executive Officer has provided continued service to RSL or its subsidiaries through such date. As of June 30, 2019, the performance conditions had not been met and were deemed not probable of being met. For the three months ended June 30, 2019 and 2018, the Company recorded no share-based compensation expense related to these RSL RSUs. As of June 30, 2019, there was $0.9 million of unrecognized compensation expense related to unvested RSL RSUs. The Company will recognize this share-based compensation expense upon achievement of the performance and market conditions through the requisite service period.