Immunovant, Inc.IMVT
Immunovant, Inc. Stock Compensation Disclosure
Stock-Based Compensation
2019 Equity Incentive Plan
In December 2019, the Company’s stockholders approved the 2019 Equity Incentive Plan (the “2019 Plan”) and reserved 5,500,000 shares of common stock for issuance thereunder. The number of shares of common stock reserved for issuance under the 2019 Plan will automatically increase on April 1 of each year, continuing through April 1, 2029, by 4.0% of the total number of shares of common stock outstanding on the last day of the preceding month, or a lesser number of shares as may be determined by the board of directors. The maximum number of shares of common stock that may be issued pursuant to the exercise of incentive stock options under the 2019 Plan is 16,500,000. The Company’s employees, directors and consultants are eligible to receive non-qualified and incentive stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, other stock awards and performance awards under the plan. Generally, each option will have an exercise price equal to the fair market value of the Company’s common stock on the date of grant and a ten-year contractual term. For grants of incentive stock options, if the grantee owns, or is deemed to own, 10% or more of the total voting power of the Company, then the exercise price shall be 110% of the fair market value of the Company’s common stock on the date of grant and the option will have a five-year contractual term. Stock options that are forfeited, cancelled or have expired are available for future grants.
On April 1, 2024, 5,823,319 shares of common stock were added to the 2019 Plan pool in accordance with the 4.0% evergreen provision of the 2019 Plan. As of March 31, 2025, options to purchase 10,357,061 shares of common stock and 3,239,901 restricted stock units (“RSUs”) were outstanding under the 2019 Plan and 6,027,035 shares of common stock remained available for future grant under the 2019 Plan.
2018 Equity Incentive Plan
As of the effective date of the 2019 Plan, no further stock awards have been or will be made under the 2018 Equity Incentive Plan (the “2018 Plan”). As of March 31, 2025, options to purchase 2,606,773 shares of common stock were outstanding under the 2018 Plan.
2023 Inducement Plan
On February 1, 2023, the Company’s board of directors approved the adoption of the 2023 Inducement Plan (the “Inducement Plan”), which is to be used exclusively for grants of awards to individuals who were not previously employees or directors of the Company (or following a bona fide period of non-employment) as a material inducement to such individuals’ entry into employment with the Company, pursuant to Nasdaq Listing Rule 5635(c)(4). The Company has reserved 5,000,000 shares of its common stock that may be issued under the Inducement Plan. The terms and conditions of the Inducement Plan are substantially similar to those of the 2019 Plan. As of March 31, 2025, no awards were granted or outstanding under the Inducement Plan.
Stock Option Activity
A summary of the stock option activity under the Company’s equity incentive plans is as follows:
| Number of Stock Options | Weighted- Average Exercise Price | Remaining Contractual Term (Years) | Aggregate Intrinsic Value (in thousands) | ||||||||||||||||||||
| Balance – March 31, 2024 | 13,026,329 | $ | 9.85 | 7.51 | $ | 293,920 | |||||||||||||||||
| Granted | 1,605,988 | 29.51 | |||||||||||||||||||||
| Exercised | (630,555) | 7.44 | |||||||||||||||||||||
| Forfeited | (1,024,099) | 14.83 | |||||||||||||||||||||
| Expired | (13,829) | 16.21 | |||||||||||||||||||||
| Balance – March 31, 2025 | 12,963,834 | $ | 12.00 | 6.25 | $ | 88,960 | |||||||||||||||||
| Exercisable – March 31, 2025 | 9,430,422 | $ | 9.20 | 5.51 | $ | 76,772 | |||||||||||||||||
The aggregate intrinsic value is calculated as the difference between the exercise price of all outstanding and exercisable stock options and the fair value of the Company’s common stock at March 31, 2025. The intrinsic value of stock options exercised during the years ended March 31, 2025, 2024 and 2023 was $12.2 million, $22.1 million and $0.5 million, respectively. The stock options granted during the years ended March 31, 2025, 2024 and 2023 had a weighted-average fair value of $21.51 per share, $14.10 per share and $5.39 per share, respectively, at the grant date. The total grant-date fair value of stock options vested during the years ended March 31, 2025, 2024 and 2023 was $24.9 million, $21.6 million and $17.3 million, respectively. The Company estimated the fair value of each option on the date of grant using the Black-Scholes option pricing model applying the weighted-average assumptions in the following table:
| Years Ended March 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Risk-free interest rate | 3.59% – 4.71% | 3.45% – 4.94% | 2.74% – 4.21% | ||||||||||||||
| Expected term, in years | 6.11 | 6.11 | 6.11 | ||||||||||||||
| Expected volatility | 77.66% – 83.31% | 93.66% – 98.15% | 87.12% – 93.78% | ||||||||||||||
| Expected dividend yield | —% | —% | —% | ||||||||||||||
Restricted Stock Unit Awards
A summary of RSUs activity under the Company’s equity incentive plans is as follows:
| Number of RSUs | Weighted- Average Grant Date Fair Value | ||||||||||
Nonvested as of March 31, 2024 | 3,466,057 | $ | 12.32 | ||||||||
| Issued | 2,099,404 | 28.97 | |||||||||
| Vested | (1,544,747) | 12.65 | |||||||||
| Forfeited | (780,813) | 17.52 | |||||||||
Nonvested as of March 31, 2025 | 3,239,901 | $ | 21.70 | ||||||||
The RSUs granted during the years ended March 31, 2025, 2024 and 2023 had a weighted-average fair value of $28.97 per share, $17.15 per share and $6.79 per share, respectively, at the grant date. The total grant-date fair value of RSUs vested during the years ended March 31, 2025, 2024 and 2023 was $19.5 million, $13.5 million and $12.9 million, respectively.
Stock-based Compensation Expense
For the years ended March 31, 2025, 2024 and 2023, stock-based compensation expense under the Company’s equity incentive plans was as follows (in thousands):
| Years Ended March 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Research and development expenses | $ | 27,014 | $ | 20,409 | $ | 14,779 | |||||||||||
| General and administrative expenses | 22,449 | 20,604 | 17,187 | ||||||||||||||
| Total stock-based compensation | $ | 49,463 | $ | 41,013 | $ | 31,966 | |||||||||||
As of March 31, 2025, total unrecognized compensation expense related to nonvested stock options and RSUs was $43.8 million and $58.1 million, respectively, which is expected to be recognized over the remaining weighted-average service period of 2.18 years and 2.49 years, respectively.
Stock-based Compensation Allocated to the Company by RSL
In relation to the RSL common share awards and options issued by RSL to employees of Roivant and the Company, the Company did not have any stock-based compensation expense for the years ended March 31, 2025 and 2024 and recorded $0.1 million of stock-based compensation expense for the year ended March 31, 2023 in the accompanying consolidated statement of operations.
The RSL common share awards are valued at fair value on the date of grant and stock-based compensation expense is recognized and allocated to the Company over the required service period. The allocation of stock-based compensation for Roivant employees is based upon the relative percentage of time utilized by Roivant employees on Company matters.
RSL RSUs
The Company’s former Chief Executive Officer was granted 73,155 RSUs of RSL in January 2021, which vested over a period of four years. For the year ended March 31, 2025, stock-based compensation expense recorded by the Company related to these RSUs was de minimis. For the years ended March 31, 2024 and 2023, the Company recorded $0.1 million and $0.2 million, respectively, of stock-based compensation expense related to these RSUs. As of March 31, 2025, there was no unrecognized compensation expense remaining related to the RSL RSUs.
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.