Stock-Based Compensation

3 Months Ended

Mar. 31, 2025

Share-Based Payment Arrangement [Abstract]

Stock-Based Compensation

10. Stock-Based Compensation

Stock-based compensation expense as reflected in the Company’s condensed consolidated statements of operations and comprehensive loss was as follows (in thousands):

	Three months ended March 31,
	2025		2024
Research and development	$	271	$	233
General and administrative		716		669
Stock-based compensation expense included in operating expenses	$	987	$	902

2021 Equity Incentive Plan

The Company has two equity incentive plans: the 2019 Equity Incentive Plan (“2019 Plan”) and the 2021 Equity Incentive Plan (“2021 Plan”). New awards can only be granted under the 2021 Plan, under which the Company is able to issue equity awards to employees, board members, consultants and advisors. The 2021 Plan became effective on June 24, 2021, the date the prospectus related to the Company’s initial public offering (“IPO”) was deemed effective by the SEC. The 2021 Plan authorizes the award of stock options, restricted stock awards (“RSAs”), stock appreciation rights (“SARs”), restricted stock units (“RSUs”), cash awards, performance awards and stock bonus awards. The Company initially reserved 1,483,445 shares of its common stock, plus any reserved shares not issued or subject to outstanding grants under the 2019 Plan on the effective date of the 2021 Plan, for issuance pursuant to awards granted under the 2021 Plan. The number of shares reserved for issuance under the 2021 Plan will increase automatically on January 1 of 2022 through 2031 by the number of shares equal to the lesser of 5% of the aggregate number of outstanding shares of the Company’s common stock as of the immediately preceding December 31, or a number as may be determined by the Company’s Board in any particular year. As such, 2,956,557 shares were added to the 2021 Plan in January 2025. As of March 31, 2025, 2,843,411 shares remained available for future issuance under the 2021 Plan.

2021 Employee Stock Purchase Plan

The Company has adopted the Employee Stock Purchase Plan (“ESPP”) which became effective June 24, 2021, the date the prospectus related to the Company’s IPO was deemed effective by the SEC, to enable eligible employees to purchase shares of its common stock with accumulated payroll deductions at a discount beginning on a date to be determined by the Board or compensation committee. The ESPP is intended to qualify under Section 423 of the Internal Revenue Code. The Company initially reserved 228,222 shares of its common stock for sale under the ESPP. The aggregate number of shares reserved for sale under the ESPP will increase automatically on January 1 of 2022 through 2031 by the number of shares equal to the lesser of 1% of the total outstanding shares of the Company’s common stock as of the immediately preceding December 31 (rounded to the nearest whole share) or a number of shares as may be determined by the Board in any particular year. As such, 591,311 shares were added to the ESPP in January 2025. As of March 31, 2025, no offering periods have commenced, and 1,708,942 shares remained available for future issuance under the ESPP.

The aggregate number of shares issued over the term of the ESPP, subject to stock splits, recapitalizations or similar events, may not exceed 4,564,440 shares of the Company’s common stock.

Stock Options

The following is a summary of the Company’s stock option activity for the three months ended March 31, 2025:

		Weighted-		Weighted- Average	Aggregate
		Average		Remaining Contractual	Intrinsic Value
	Options	Exercise Price		Term (in years)	(in thousands)
Outstanding at December 31, 2024	6,317,063	$	2.97	8.22	$	4
Granted	2,683,704		0.78
Cancelled	(1,943,546)		1.76
Outstanding at March 31, 2025	7,057,221	$	2.47	8.15	$	—
Vested at March 31, 2025	3,288,233	$	3.33	6.87	$	—
Vested and expected to vest at March 31, 2025	7,057,221	$	2.47	8.15	$	—

The following is a summary of the Company’s stock option activity for the three months ended March 31, 2024:

		Weighted-		Weighted- Average	Aggregate
		Average		Remaining Contractual	Intrinsic Value
	Options	Exercise Price		Term (in years)	(in thousands)
Outstanding at December 31, 2023	4,178,194	$	2.98	8.22	$	11
Granted	2,002,950		2.86
Exercised	(362,947)		1.33
Cancelled	(70,964)		2.32
Outstanding at March 31, 2024	5,747,233	$	3.05	8.74	$	15,641
Vested at March 31, 2024	2,030,376	$	3.77	7.55	$	5,209
Vested and expected to vest at March 31, 2024	5,747,233	$	3.05	8.74	$	15,641

The weighted average grant-date fair value of stock options granted during the three months ended March 31, 2025 and 2024 was $0.45 and $1.92 per share, respectively. The fair value of each stock option was estimated using a Black-Scholes option-pricing model with the following assumptions:

	Three months ended March 31,
	2025		2024
Risk-free interest rate	3.96 - 4.50	%	4.07 - 4.27	%
Volatility	75 - 76	%	72 - 73	%
Dividend yield	0.00	%	0.00	%
Expected term (years)	5 - 6		5 - 6

The fair value of options that vested during the three months ended March 31, 2025 and 2024 was $1.3 million and $5.1 million, respectively. The Company recorded stock-based compensation expense associated with stock option awards of $0.7 million during both of the three months ended March 31, 2025 and 2024. As of March 31, 2025, there was $3.7 million of total unrecognized compensation cost related to unvested stock-based awards, which the Company expects to recognize over a remaining weighted-average period of 2.7 years.

Restricted Stock Units

The Company issues restricted stock units (“RSUs”) to employees that generally vest over a four-year period with 25% of awards vesting after one year and then quarterly thereafter. Any unvested shares will be forfeited upon termination of services. The fair value of an RSU is equal to the fair market value price of the Company’s common stock on the date of grant. RSU expense is amortized straight-line over the vesting period.

The following table summarizes activity related to RSUs:

		Weighted- Average
		Grant Date
	Shares	Fair Value
Unvested at December 31, 2024	469,981	$	3.34
Granted	17,812	$	0.37
Vested	(118,629)	$	4.11
Cancelled	(139,197)	$	2.63
Unvested at March 31, 2025	229,967	$	3.14

The Company recorded stock-based compensation expense associated with RSU awards of $0.3 million and $0.2 million for the three months ended March 31, 2025 and 2024, respectively. As of March 31, 2025, the total unrecognized expense related to all RSUs was $0.7 million, which the Company expects to recognize over a weighted-average period of 2.2 years.

In connection with the vesting of RSUs, the Company adopted a net settlement method whereby shares of common stock are withheld to satisfy tax withholding and remittance obligations. As of March 31, 2025, the Company withheld 93,130 shares, which are held in Treasury Stock, for $0.1 million.