STOCK-BASED COMPENSATION

9 Months Ended

Sep. 30, 2024

Share-Based Payment Arrangement [Abstract]

STOCK-BASED COMPENSATION

11. STOCK-BASED COMPENSATION

The following table summarizes the Company’s stock awards granted for each of the periods indicated:

	For the Three Months Ended September 30,								For the Nine Months Ended September 30,
	2024				2023				2024					2023
	Grants		Weighted Average Grant Date Fair Value		Grants		Weighted Average Grant Date Fair Value		Grants			Weighted Average Grant Date Fair Value		Grants			Weighted Average Grant Date Fair Value
Stock options		6,442	$	55.16		50,875	$	66.53		327,920		$	67.39		1,135,799		$	72.23
Restricted stock units		135,092	$	127.51		27,539	$	118.05		1,351,982	(1)	$	128.90		1,137,202	(2)	$	153.02

(1) Included in restricted stock units (“RSUs”) for the nine months ended September 30, 2024 are 97,460 shares with performance conditions (“March 2024 PSUs”) which are related to the achievement of certain financial performance goals and regulatory approval of certain of the Company's product candidates. The expanded regulatory approval of ELEVIDYS in June 2024 resulted in the cliff-vesting of 44,300 of the 97,460 shares of the March 2024 PSUs during the nine months ended September 30, 2024. As of September 30, 2024, none of the performance conditions for the remaining 53,160 shares were probable of being achieved. Stock options and the

remaining RSUs granted during the three and nine months ended September 30, 2024 have only service-based criteria and vest over four years.

(2) Included in the RSUs for the nine months ended September 30, 2023 are 502,225 shares with performance conditions (the “March 2023 PSUs”), which are related to regulatory approval of ELEVIDYS and achievement of a certain financial performance target, both of which were achieved in 2023. Vesting of the March 2023 PSUs is contingent on the fulfillment of remaining service conditions.

During the year ended December 31, 2022, the Company granted 38,500 RSUs with performance conditions (the “March 2022 PSUs”), which are related to regulatory approval of certain of the Company's product candidates. As a result of the expanded regulatory approval of ELEVIDYS in June 2024, a portion of the March 2022 PSUs became eligible for vesting. Vesting of the March 2022 PSUs is contingent on the fulfillment of remaining service conditions. As of September 30, 2024, none of the remaining performance conditions were probable of being achieved.

Stock-based Compensation Expense

For the three months ended September 30, 2024 and 2023, total stock-based compensation expense was $43.5 million and $48.1 million, respectively. For the nine months ended September 30, 2024 and 2023, total stock-based compensation expense was $134.6 million and $136.7 million, respectively.

The following table summarizes stock-based compensation expense by grant type and by function included within the unaudited condensed consolidated statements of comprehensive income (loss):

		For the Three Months Ended September 30,					For the Nine Months Ended September 30,
		2024			2023		2024			2023
	(in thousands)
Stock options		$	15,158		$	17,471	$	46,954		$	62,436
Restricted stock units			31,926			28,924		97,261			70,101
Employee Stock Purchase Program			1,912			1,666		5,640			4,151
Subtotal		$	48,996		$	48,061	$	149,855		$	136,688
Capitalized stock-based compensation costs*			(5,546	)		—		(15,231	)		—
Total stock-based compensation expense included in expenses		$	43,450		$	48,061	$	134,624		$	136,688
Research and development			18,034			22,325		54,113			60,315
Selling, general and administrative			25,416			25,736		80,511			76,373
Total stock-based compensation expense included in expenses		$	43,450		$	48,061	$	134,624		$	136,688

*Prior to the nine months ended September 30, 2024, capitalized stock-based compensation costs were not material.