v3.23.2
Stockholders' Equity
 12 Months Ended
Dec. 31, 2022
Equity [Abstract]  
Stockholders' Equity Stockholders’ Equity
Authorized and Outstanding Capital Stock
On June 5, 2020, the Company filed a Certificate of Amendment to its Ninth Amended and Restated Certificate of Incorporation, or its Charter, to increase the number of authorized shares of common stock from 175,000,000 to 350,000,000. As of December 31, 2022, the authorized capital stock of the Company included 350,000,000 shares of common stock, par value $0.00001 per share, of which 184,135,714 and 177,000,963 shares were issued and outstanding at December 31, 2022 and 2021, respectively; and 25,000,000 shares of undesignated preferred stock, par value $0.00001 per share, of which no shares were issued and outstanding at December 31, 2022 and 2021.
At-the-Market Facility

On March 12, 2020, the Company filed a prospectus supplement relating to the Company's sales agreement with Cantor Fitzgerald & Co., or the Prior Sales Agreement, pursuant to which it was able to offer and sell up to $65.0 million of its common stock at current market prices from time to time. Through December 31, 2020, the Company sold 3,509,381 shares of common stock under this program with net proceeds (after deducting commissions and other offering expenses) of $10.6 million. During the three months ended March 31, 2021, the Company sold 5,224,278 shares of common stock under this program with net proceeds (after deducting commissions and other offering expenses) of $15.9 million.

On February 25, 2021, the Company filed a prospectus relating to the sales agreement with its new shelf registration statement (which replaced the prior shelf registration statement), pursuant to which it was able to offer and sell up to $100.0 million of its common stock at current market prices from time to time. Through December 31, 2021, the Company sold 21,128,065 shares of common stock under this program with net proceeds (after deducting commissions and other offering expenses) of $72.4 million. On March 1, 2022, the Company filed a prospectus relating to the Prior Sales Agreement, pursuant to which it was authorized to offer and sell up to $25.3 million of its common stock at current market prices from time to time. On March 16, 2022, the Company terminated the Prior Sales Agreement. During the three months ended March 31, 2022, the Company sold 404,600 shares of common stock under this program with net proceeds (after deducting commissions and other offering expenses) of $0.8 million.

On April 7, 2022, the Company entered into an Open Market Sale AgreementSM, or the Sales Agreement, with Jefferies LLC, or Jefferies, as agent, for the offer and sale of common stock at current market prices in amounts to be determined from time to
time. Also, on April 7, 2022, the Company filed a prospectus supplement relating to the Sales Agreement, pursuant to which it is able to offer and sell under the Sales Agreement up to $26.0 million of its common stock at current market prices from time to time. From the date of filing of the prospectus supplement through the date of the filing of the Company's Annual Report on Form 10-K filed on March 10, 2023, the Company has not sold any shares of its common stock under this program.
Equity Plans
The Company maintains one stock incentive plan, the 2014 Incentive Plan, or the 2014 Plan, as well as the 2014 Employee Stock Purchase Plan, or the 2014 ESPP. The 2014 Plan replaced the Company’s Amended and Restated 2008 Equity Incentive Plan, or the 2008 Plan, however, options or other awards granted under the 2008 Plan prior to the adoption of the 2014 Plan that have not been settled or forfeited remain outstanding and effective. On June 6, 2019, the Company’s stockholders approved the Amended and Restated 2014 Employee Stock Purchase Plan, or the ESPP. In May 2016, the Company’s Board of Directors approved an inducement award program that was separate from the Company’s equity plans and which, consistent with Nasdaq Listing Rule 5635(c)(4), did not require stockholder approval, or the Inducement Award Program. During the year ended December 31, 2022, the Company granted 435,000 options to purchase shares of the Company’s common stock to new hires under the Inducement Award Program, of which 258,000 options to purchase shares of the Company's common stock remained outstanding at December 31, 2022.
The 2014 Plan allows for the granting of stock options, stock appreciation rights, or SARs, restricted stock, unrestricted stock, restricted stock units, or RSUs, performance awards and other awards convertible into or otherwise based on shares of the Company’s common stock. Dividend equivalents may also be provided in connection with an award under the 2014 Plan. The Company’s employees, officers, directors and consultants and advisors are eligible to receive awards under the 2014 Plan. The Company initially reserved 1,785,000 shares of its common stock for the issuance of awards under the 2014 Plan. The 2014 Plan provides that the number of shares reserved and available for issuance under the 2014 Plan will automatically increase annually on January 1 of each calendar year, by an amount equal to three percent (3%) of the number of the Company's shares outstanding on a fully diluted basis as of the close of business on the immediately preceding December 31, or the 2014 Plan Evergreen Provision. The Company’s Board of Directors may act prior to January 1 of any year to provide that there will be no automatic increase in the number of Akebia Shares available for grant under the 2014 Plan for that year (or that the increase will be less than the amount that would otherwise have automatically been made). On December 12, 2018, in connection with the consummation of the Merger, the Company assumed outstanding and unexercised options to purchase Keryx's stock, as adjusted by the Exchange Multiplier pursuant to the terms of the Merger Agreement, under the following Keryx equity plans, or the Keryx Equity Plans: the Keryx 1999 Share Option Plan, the Keryx 2004 Long-Term Incentive Plan, the Keryx 2007 Incentive Plan, the Keryx Amended and Restated 2013 Incentive Plan, and the Keryx 2018 Equity Incentive Plan, or the Keryx 2018 Plan. In addition, the number of Keryx shares available for issuance under the Keryx 2018 Plan, as adjusted by the Exchange Multiplier pursuant to the terms of the Merger Agreement, may be used for awards granted by the Company under its 2014 Plan, or the Assumed Shares, provided that the Company uses the Assumed Shares for individuals who were not employees or directors of the Company prior to the consummation of the Merger. During the year ended December 31, 2022, the Company granted 3,233,500 options to purchase Akebia Shares to employees under the 2014 Plan, 435,000 options to purchase Akebia Shares to employees under the Inducement Award Program, 5,219,908 Akebia RSUs to employees under the 2014 Plan, 800,000 performance stock units, or PSUs, to employees under the 2014 Plan, 140,700 options to purchase Akebia Shares to directors under the 2014 Plan, and 95,900 RSUs to directors under the 2014 Plan.  
The ESPP provides for the issuance of shares of the Company’s common stock to participating employees at a discount to their fair market value. The maximum aggregate number of shares at December 31, 2022 of the Company’s common stock available for future issuance under the ESPP is 4,837,995. Under the ESPP, each offering period is six months, at the end of which employees may purchase shares of the Company’s common stock through payroll deductions made over the term of the offering. The per-share purchase price at the end of each offering period is equal to the lesser of eighty-five percent (85%) of the closing price of the Company’s common stock at the beginning or end of the offering period.
Shares Reserved for Future Issuance
The Company has reserved for future issuance the following number of shares of common stock:
 December 31, 2022December 31, 2021
Common stock options, RSUs and PSUs outstanding (1)
17,407,227 16,065,218 
Shares available for issuance under Akebia equity plans (2)
5,498,984 4,675,734 
Warrant to purchase common stock— 509,611 
Shares available for issuance under the ESPP4,837,995 5,173,141 
Total27,744,206 26,423,704 
 
(1)Includes awards granted under the 2014 Plan and the Inducement Award Program and awards issued in connection with the Merger.
(2)On January 1, 2023, January 1, 2022 and January 1, 2021, the shares reserved for future grants under the 2014 Plan increased by 6,046,288, 5,807,270 and 4,880,775 shares, respectively, pursuant to the 2014 Plan Evergreen Provision.
Stock-Based Compensation
Stock Options
Service-Based Stock Options
On February 28, 2022, as part of the Company’s annual grant of equity, the Company issued 2,833,500 stock options to employees. In addition, the Company issues stock options to directors, new hires and occasionally to other employees not in connection with the annual grant process. Options granted by the Company generally vest over periods of between 12 and 48 months, subject, in each case, to the individual’s continued service through the applicable vesting date. Options generally vest either 100% on the first anniversary of the grant date or in installments of (i) 25% at the one year anniversary and (ii) 12 equal quarterly installments beginning after the one year anniversary of the grant date, subject to the individual’s continuous service with the Company. Options generally expire ten years after the date of grant. The Company recorded approximately $6.8 million, $8.9 million and $8.5 million of stock-based compensation expense related to stock options granted during the years ended December 31, 2022, 2021 and 2020, respectively.
The assumptions used in the Black-Scholes pricing model to estimate the grant date fair value of options granted under the 2014 Plan are as follows:
 Year ended December 31,
 202220212020
Risk-free interest rate1.69%-4.17%0.66%-1.37%0.32%-1.38%
Dividend yield—%—%—%
Volatility79.77%-91.57%77.81%-81.79%69.56%-75.91%
Expected term (years)5.51-6.255.51-6.255.51-6.25
 
The following table summarizes the Company’s stock option activity, excluding performance-based options, for the year ended December 31, 2022:
 SharesWeighted-Average
Exercise Price		Weighted-Average
Contractual Life
(in years)		Aggregate
Intrinsic Value
Outstanding, December 31, 202111,398,215 $7.60 $267,830 
Granted3,809,200 $1.81 
Exercised(142,440)$0.47 $44,905 
Forfeited(3,331,840)$6.43 $3,813 
Expired/cancelled(407,045)$9.52 
Outstanding, December 31, 202211,326,090 $6.01 7.26$112,709 
Options exercisable, December 31, 20226,239,437 $8.37 6.08$1,904 
Vested and expected to vest, December 31, 202211,326,090 $6.01 
 
The weighted-average grant date fair values of options granted in the years ended December 31, 2022, 2021, and 2020 were $1.27, $2.29, and $5.63 per share, respectively. There was an immaterial intrinsic value of options exercised during the year ended December 31, 2022 as the value of the options exercised in 2022 was immaterial. There was no intrinsic value of options
exercised during the year ended December 31, 2021, as there were no options exercised in 2021. The total intrinsic value of options exercised during the year ended December 31, 2020 was $0.4 million. The fair value of options that vested during the years ended December 31, 2022, 2021, and 2020 were $8.4 million, $10.6 million, and $6.8 million, respectively. As of December 31, 2022, there was approximately $8.1 million of unrecognized compensation cost related to stock options outstanding under the Company’s 2014 Plan or made pursuant to the Inducement Award Program, which is expected to be recognized over a weighted average period of 2.04 years.
Performance-Based Stock Options
The Company also grants performance-based stock options to employees under the 2014 Plan. The performance-based stock options granted by the Company generally vest in connection with the achievement of specified commercial, regulatory, and corporate milestones. The expense recognized for these awards is based on the grant date fair value of the Company's common stock multiplied by the number of options granted and recognized over time based on the probability of meeting such commercial, regulatory and corporate milestones. The Company issued 400,000 and 99,558 performance-based options during the years ended December 31, 2022 and 2021, respectively. As of December 31, 2022, the Company had 400,000 performance-based options outstanding compared to 99,558 performance-based options outstanding at December 31, 2021.
The following table summarizes the Company’s performance-based option activity for the year ended December 31, 2022:
 SharesWeighted-Average
Exercise Price		Weighted-Average
Contractual Life
(in years)		Aggregate
Intrinsic Value
Outstanding, December 31, 202199,558 $2.74 $— 
Granted400,000 $0.41 $1,120 
Exercised— $— $— 
Forfeited/cancelled(99,558)$2.74 
Outstanding, December 31, 2022400,000 $0.41 9.4$66,800 
 
The Company did not record any stock-based compensation expense related to performance-based options during 2022, 2021 and 2020. There were no performance-based options that vested during fiscal year 2022, 2021 or 2020. As of December 31, 2022, there were no unrecognized compensation costs related to performance-based stock options under the Company’s 2014 Plan.
Restricted Stock Units
Service-Based Restricted Stock Units
On February 28, 2022, as part of the Company’s annual grant of equity, the Company issued 2,899,008 RSUs to employees. In addition, the Company also occasionally issues RSUs not in connection with the annual grant process to employees. Generally, RSUs granted by the Company vest in one of the following ways: (i) 100% of each RSU grant vests on the first anniversary of the grant date, (ii) one third of each RSU grant vests on the first, second and third anniversaries of the grant date, (iii) 50% of each RSU grant vests on the first anniversary and 25% of each RSU grant vests every six months after the one year anniversary of the grant date, or (iv) one third of each RSU grant vests on the first anniversary of the grant date and the remaining two-thirds vests in eight substantially equal quarterly installments beginning after the one year anniversary, subject, in each case, to the individual’s continued service through the applicable vesting date. The expense recognized for these awards is based on the grant date fair value of the Company’s common stock multiplied by the number of units granted and recognized on a straight-line basis over the vesting period. The Company recorded approximately $7.6 million, $12.9 million and $14.6 million of stock-based compensation expense related to employee RSUs in 2022, 2021 and 2020, respectively.

Performance-Based Restricted Stock Units
During the year ended December 31, 2022, the Company issued 400,000 performance-based restricted stock units, or PSUs, to the Company’s executives. The PSUs granted by the Company vest in connection with the achievement of specified commercial, regulatory, and corporate milestones. The expense recognized for these awards is based on the grant date fair value of the Company’s common stock multiplied by the number of units granted and recognized over time based on the probability of meeting such commercial, regulatory, and corporate milestones. The Company recorded approximately $0.1 million, $0.3 million and $0.5 million of stock-based compensation expense related to employee PSUs in 2022, 2021 and 2020, respectively.
The following table summarizes the Company’s RSU and PSU activity for the year ended December 31, 2022:
 
 SharesWeighted-
Average Grant
Date Fair Value
Unvested balance, December 31, 20214,554,343 $5.17 
Granted5,715,808 $1.30 
Vested(2,252,565)$5.01 
Forfeited(2,349,551)$3.33 
Unvested balance, December 31, 20225,668,035 $2.09 
The total fair value of RSUs and PSUs that vested during 2022, 2021 and 2020 (measured on the date of vesting) was $11.2 million, $15.4 million, and $9.4 million, respectively. As of December 31, 2022, there was approximately $5.2 million of unrecognized compensation cost related to RSUs and PSUs, which is expected to be recognized over a weighted average period of 1.44 years.
Employee Stock Purchase Plan
 
The first offering period under the ESPP opened on January 2, 2015. The Company issued 335,146 shares during the year ended December 31, 2022. The Company recorded approximately $0.1 million, $0.6 million and $0.8 million of stock-based compensation expense related to the ESPP during 2022, 2021 and 2020, respectively.
Compensation Expense Summary
 
The Company has classified its stock-based compensation expense related to share-based awards as follows (in thousands):
 Years ended December 31,
 202220212020
Research and development$3,683 $5,816 $6,113 
Selling, general and administrative10,969 16,919 18,347 
Total$14,652 $22,735 $24,460 
 
 
Compensation expense by type of award (in thousands):
 Years ended December 31,
 202220212020
Stock options$6,839 $8,958 $8,517 
Restricted stock units7,566 12,927 14,639 
Performance RSUs100 294 464 
Employee stock purchase plan147 556 840 
Total$14,652 $22,735 $24,460