COLLEGIUM PHARMACEUTICAL, INCCOLL
COLLEGIUM PHARMACEUTICAL, INC Stock Compensation Disclosure
Stock-based Compensation
Performance Share Units, Restricted Stock Units and Stock Options
Performance Share Units
The Company periodically grants PSUs to certain members of the Company's senior management team. PSUs vest subject to the satisfaction of annual and cumulative performance and/or market conditions established by the Compensation Committee.
Beginning in February 2020 and each year thereafter, the Company granted PSUs with performance criteria related to the relative ranking of the total stockholder return (“TSR”) of the Company’s common stock for each individual year within a three-year performance period as well as the cumulative three-year performance period return relative to the TSR of certain peer companies within the S&P Pharmaceutical Select Industry Index. TSR will be measured based on the 30-day average
stock price on the first day of each period compared to the 30-day average stock price on the last day of each period. The PSUs subject to the annual performance criteria will vest annually, subject to the satisfaction of the performance criteria and the executive’s continued employment through the performance period. The cumulative PSUs will vest following the three-year performance period, subject to the satisfaction of the performance criteria and the executive’s continued employment through the performance period. PSUs may vest in a range between 0% and 200%, based on the satisfaction of performance, and no shares will be issued if the minimum applicable performance metric is not achieved. As these PSUs vest based on the achievement of market conditions, the grant date fair values were determined using a Monte-Carlo valuation model. The Monte-Carlo valuation model considered a variety of potential future share prices for the Company as well as its peer companies in the selected market index.
A summary of the Company’s PSUs activity for the year ended December 31, 2025 and related information is as follows:
| Shares | Weighted-Average Grant Date Fair Value | ||||||||||
| Outstanding as of December 31, 2024 | 329,652 | $ | 39.04 | ||||||||
| Granted | 151,466 | 40.28 | |||||||||
| Vested | (163,423) | 32.08 | |||||||||
| Forfeited | (38,862) | 43.59 | |||||||||
| Performance adjustment | 34,809 | 29.74 | |||||||||
| Outstanding as of December 31, 2025 | 313,642 | $ | 41.65 | ||||||||
The number of PSUs awarded represents the target number of shares of common stock that may be earned; however, the actual number of shares earned may vary based on the satisfaction of performance criteria. The weighted-average grant date fair value of PSUs granted for the years ended December 31, 2025, 2024, and 2023 was $40.28, $44.15, and $38.71, respectively. The total fair value of PSUs vested (measured on the date of vesting) for the years ended December 31, 2025, 2024, and 2023 was $4,925, $17,433, and $5,970, respectively.
For the years ended December 31, 2025, 2024, and 2023, the stock-based compensation expense for PSUs was $6,040, $5,037, and $7,037 respectively.
As of December 31, 2025, the unrecognized compensation cost related to performance share units was $5,412 and is expected to be recognized as expense over approximately 1.7 years.
Restricted Stock Units
A summary of the Company’s RSUs activity for the year ended December 31, 2025 and related information is as follows:
| Shares | Weighted-Average Grant Date Fair Value | ||||||||||
| Outstanding as of December 31, 2024 | 2,483,342 | $ | 28.27 | ||||||||
| Granted | 1,450,557 | 30.40 | |||||||||
| Vested | (1,042,478) | 27.33 | |||||||||
| Forfeited | (274,096) | 30.63 | |||||||||
| Outstanding as of December 31, 2025 | 2,617,325 | $ | 29.57 | ||||||||
The weighted-average grant date fair value of RSUs granted for the years ended December 31, 2025, 2024, and 2023 was $30.40, $34.33, and $26.25, respectively. The total fair value of RSUs vested (measured on the date of vesting) for the years ended December 31, 2025, 2024, and 2023 was $32,904, $32,792, and $17,677, respectively.
As of December 31, 2025, the unrecognized compensation cost related to RSUs was $48,555 and is expected to be recognized as expense over approximately 1.9 years.
Stock Options
A summary of the Company’s stock option activity for the year ended December 31, 2025 and related information is as follows:
| Shares | Weighted- Average Exercise Price per Share | Weighted- Average Remaining Contractual Term (in years) | Aggregate Intrinsic Value | ||||||||||||||||||||
| Outstanding as of December 31, 2024 | 803,406 | $ | 20.84 | 4.4 | $ | 6,634 | |||||||||||||||||
| Exercised | (244,245) | 17.52 | |||||||||||||||||||||
| Outstanding as of December 31, 2025 | 559,161 | $ | 22.29 | 3.9 | $ | 13,425 | |||||||||||||||||
| Exercisable as of December 31, 2025 | 461,403 | $ | 20.36 | 2.9 | $ | 11,970 | |||||||||||||||||
The Company did not grant stock options during the years ended December 31, 2025 and 2023. The weighted-average assumptions used in the Black-Scholes option pricing model to determine the fair value of the employee stock option granted in the year ended December 31, 2024 were as follows:
| Years Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Risk-free interest rate | — | % | 4.4 | % | — | % | |||||||||||
| Volatility | — | % | 51.7 | % | — | % | |||||||||||
| Expected term (years) | — | 6.1 | — | ||||||||||||||
| Expected dividend yield | — | % | — | % | — | % | |||||||||||
Risk-free Interest Rate. The risk-free interest rate assumption is based on observed interest rates appropriate for the expected term of the stock option grants.
Expected Volatility. Due to the Company’s limited operating history and lack of company-specific historical or implied volatility, the expected volatility assumption is based on the Company’s volatility as well as the historical volatilities of a peer group of similar companies whose share prices are publicly available. The peer group was developed based on companies in the biotechnology and pharmaceutical industries. In evaluating similarity, the Company considers factors such as industry, stage of life cycle and size.
Expected Term. The expected term represents the period of time that options are expected to be outstanding. Because the Company does not have sufficient levels of historical exercise behavior through December 31, 2025, it determined the expected term assumption using the simplified method, which is an average of the contractual term of the option and its vesting period.
Expected Dividend Yield. The expected dividend yield assumption is based on the fact that the Company has never paid cash dividends and has no present intention to pay cash dividends.
The Company did not grant stock options during the years ended December 31, 2025 and 2023. The weighted-average grant date fair value of stock options granted for the year ended December 31, 2024 was $17.10. The total intrinsic value of stock options exercised for the years ended December 31, 2025, 2024 and 2023 was $4,514, $6,833, and $4,786, respectively.
As of December 31, 2025, the unrecognized compensation cost related to outstanding options was $1,597 and is expected to be recognized as expense over approximately 2.9 years.
Employee Stock Purchase Plan
The Company’s 2015 Employee Stock Purchase Plan allows employees as designated by the Company’s Board of Directors to purchase shares of the Company’s common stock. The purchase price is equal to 85% of the lower of the closing price of the Company’s common stock on: (i) the first day of the purchase period; or (ii) the last day of the purchase period. During the year ended December 31, 2025, 50,187 shares of common stock were purchased for total proceeds of $1,363. As of December 31, 2025, there were 2,791,393 shares of common stock authorized for issuance pursuant to the employee stock purchase plan. The compensation expense for the years ended December 31, 2025, 2024, and 2023 was $582, $310, and $209 respectively.
Stock-Based Compensation Expense
The Company’s stock-based compensation expense for the years ended December 31, 2025, 2024, and 2023 was $41,906, $32,400, and $27,136, respectively, and was recorded as a component of selling, general and administrative expense within the consolidated statements of operations.
As of December 31, 2025, there was approximately $55,564 of unrecognized compensation expense related to unvested PSUs, RSUs, and options, which is expected to be recognized as expense over a weighted average period of approximately 1.9 years.
About Stock Compensation Disclosures
Stock-based compensation disclosures detail the equity awards granted to employees and executives — including stock options, restricted stock units (RSUs), and performance shares — along with the valuation methods and assumptions used to expense them. This section reveals the true cost of talent retention and the alignment between management incentives and shareholder interests.
Key signals: total unrecognized compensation expense and its expected recognition period signal future earnings headwinds from already-granted awards. For stock options, examine Black-Scholes assumptions — expected volatility, risk-free rate, and expected term — as understating any of these reduces reported compensation expense. Compare stock compensation expense as a percentage of revenue against peers to assess dilution cost. Watch vesting schedules for acceleration clauses tied to change-of-control events. Performance-based awards with undemanding targets may indicate weak governance. Add back stock compensation to operating cash flow to calculate a more conservative free cash flow figure.