Sana Biotechnology, Inc. Stock Compensation Disclosure
12. Stock-based compensation
Equity incentive plans
In February 2021, the Company adopted the 2021 Incentive Award Plan (2021 Plan) and the 2021 Employee Stock Purchase Plan (2021 ESPP), both of which became effective on the completion of the Company’s initial public offering. The 2021 Plan provides for a variety of stock-based compensation awards, including stock options, restricted stock awards (RSAs), and restricted stock units (RSUs). The 2021 ESPP allows eligible employees to purchase shares of the Company’s common stock at a discount through payroll deductions of up to 15% of their earnings, subject to plan limitations. Unless otherwise determined by the Company’s board of directors, employees may purchase shares at 85% of the lower of the fair market value of the Company’s common stock on the first date of an offering period or on the purchase date. As of December 31, 2024, 24.6 million shares and 6.0 million shares were available for future issuance under the 2021 Plan and the 2021 ESPP, respectively.
Stock-based compensation expense
Stock-based compensation expense is recognized in the consolidated statements of operations as follows:
|
|
Year Ended December 31, |
|
|||||||||
|
|
2024 |
|
|
2023 |
|
|
2022 |
|
|||
|
|
(in thousands) |
|
|||||||||
Research and development |
|
$ |
23,365 |
|
|
$ |
23,240 |
|
|
$ |
26,583 |
|
General and administrative |
|
|
14,313 |
|
|
|
12,293 |
|
|
|
11,754 |
|
Total stock-based compensation expense |
|
$ |
37,678 |
|
|
$ |
35,533 |
|
|
$ |
38,337 |
|
Unrecognized stock-based compensation costs related to unvested awards and the weighted-average period over which the costs are expected to be recognized as of December 31, 2024 are as follows:
|
|
Stock Options |
|
|
RSUs |
|
|
||
Unrecognized stock-based compensation expense (in thousands) |
|
$ |
38,856 |
|
|
$ |
18,175 |
|
|
Weighted-average period costs expected to be recognized (in years) |
|
|
2.4 |
|
|
|
3.0 |
|
|
Stock options
A summary of the Company’s stock option activity is as follows:
|
|
Stock Options |
|
|
Weighted-Average |
|
|
Weighted-Average |
|
|
Aggregate Intrinsic |
|
||||
Outstanding as of December 31, 2023 |
|
|
26,849 |
|
|
$ |
6.60 |
|
|
|
8.0 |
|
|
$ |
11,235 |
|
Granted |
|
|
7,831 |
|
|
|
8.58 |
|
|
|
|
|
|
|
||
Exercised |
|
|
(2,631 |
) |
|
|
3.59 |
|
|
|
|
|
|
|
||
Forfeited/Cancelled |
|
|
(6,987 |
) |
|
|
7.92 |
|
|
|
|
|
|
|
||
Outstanding as of December 31, 2024 |
|
|
25,062 |
|
|
$ |
7.16 |
|
|
|
7.4 |
|
|
$ |
271 |
|
Exercisable as of December 31, 2024 |
|
|
15,194 |
|
|
$ |
7.18 |
|
|
|
6.7 |
|
|
$ |
271 |
|
The fair value of stock options granted to employees, directors, and consultants was estimated on the date of grant using the Black-Scholes option pricing model using the following assumptions:
|
|
|
|
Year Ended December 31, |
|
|
Assumptions |
|
2024 |
|
2023 |
|
2022 |
Risk free interest rate |
|
3.7% – 4.7% |
|
3.36% – 4.98% |
|
1.56% – 4.31% |
Expected volatility |
|
72.5% – 75.0% |
|
70.0% – 72.5% |
|
70.0% |
Expected term (years) |
|
5.50 – 6.25 |
|
5.50 – 6.50 |
|
5.50 – 6.25 |
Expected dividend |
|
0% |
|
0% |
|
0% |
The following table summarizes additional information related to stock option activity:
|
|
|
|
|
Year Ended December 31, |
|
|
|
|
|||
|
|
2024 |
|
|
2023 |
|
|
2022 |
|
|||
Weighted average grant date fair value per share for options granted |
|
$ |
5.82 |
|
|
$ |
2.62 |
|
|
$ |
3.92 |
|
Aggregate intrinsic value of stock options exercised (in thousands) |
|
$ |
8,006 |
|
|
$ |
3,532 |
|
|
$ |
6,133 |
|
Restricted stock
A summary of the Company’s RSU activity is as follows:
|
|
RSUs |
|
|
RSUs |
|
|
||
Unvested as of December 31, 2023 |
|
|
2,341 |
|
|
$ |
3.88 |
|
|
Granted |
|
|
3,619 |
|
|
|
8.31 |
|
|
Vested |
|
|
(967 |
) |
|
|
5.10 |
|
|
Forfeited |
|
|
(1,423 |
) |
|
|
7.21 |
|
|
Unvested as of December 31, 2024 |
|
|
3,570 |
|
|
$ |
6.72 |
|
|
No RSAs vested during the year ended December 31, 2024. The fair value of vested RSAs was for the year ended December 31, 2023, and $1.8 million for the year ended December 31, 2022. The fair value of vested RSUs was $6.4 million, $1.9 million, and $0.5 million for the years ended December 31, 2024, 2023, and 2022, respectively.
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.