STOCK-BASED COMPENSATION AND EMPLOYEE RETIREMENT PLANS

12 Months Ended

Dec. 31, 2025

STOCK-BASED COMPENSATION AND EMPLOYEE RETIREMENT PLANS

Stock-Based Compensation Plans

The Company incurred stock-based compensation expenses of $11.3 million, $7.8 million and $9.3 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Equity Incentive Plans

The following table contains information about the Company's equity incentive plans:


			December 31, 2025		December 31, 2024
Title of Plan	Group Eligible	Type of Award Granted (or to be Granted)	Awards Outstanding	Additional Awards Available for Grant	Awards Outstanding	Additional Awards Available for Grant
Keryx Equity Plans(1)(2)	Employees, directors and consultants	Common stock options and RSUs	148,860	—	163,765	—

Akebia Therapeutics, Inc. 2014 Incentive Plan, as amended (2) (3) (the 2014 Plan) (replaces 2008 Plan)	Employees, directors, consultants and advisors	Common stock options, RSUs, SARs and performance awards	8,412,898	—	11,559,708	—
Akebia Therapeutics, Inc. 2023 Stock Incentive Plan, as amended(3) (the 2023 Plan) (replaces 2014 Plan)	Employees, officers, directors, consultants and advisors	Common stock options, SARs, restricted stock, unrestricted stock, RSUs, performance awards, other share-based awards and dividend equivalents	15,913,729	24,723,655	10,390,642	11,340,648

(1) The Keryx Equity Plans consist of the Keryx Biopharmaceuticals, Inc. 1999 Share Option Plan, Keryx Biopharmaceuticals, Inc., as amended, the 2004 Long-Term Incentive Plan, as amended, the Keryx Biopharmaceuticals, Inc. 2007 Incentive Plan, the Keryx Biopharmaceuticals Inc. Amended and Restated 2013 Incentive Plan and the Keryx Biopharmaceuticals, Inc. 2018 Equity Incentive Plan.

(2) New awards are no longer being granted under these plans.

(3) This table includes the following inducement awards that are subject to the terms and conditions of the applicable plan but were granted as inducement awards consistent with Nasdaq Listing Rule 5635(c)(4) and not under the applicable plan: 1,050,525 options outstanding under the 2014 Plan and 3,034,085 options outstanding under the 2023 Plan as of December 31, 2025 and 1,151,127 options outstanding under the 2014 Plan and 2,534,775 options outstanding under the 2023 Plan as of December 31, 2024.

(4) On June 10, 2025, the 2023 Plan was amended to increase the number of shares of common stock available for issuance thereunder by 18,900,000 shares.

Common Stock Options and Stock Appreciation Rights

During the year ended December 31, 2025, the Company granted 3,634,300 options to employees and 375,200 options to directors under the 2023 Plan. Options and SARs 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 and SARs 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 and SARs generally expire ten years after the date of grant.

The Company also maintains an inducement award program with a share pool that is separate from the Company's equity plans under which inducement awards may be granted consistent with Nasdaq Listing Rule 5635(c)(4). During the year ended December 31, 2025, the Company granted 1,454,477 options to purchase shares of the Company’s common stock to new hires as inducements to such employees entering into employment with the Company, of which 1,152,477 options remained outstanding at December 31, 2025.

The Company grants annual service-based stock options to employees and directors and granted SARs to certain executives under the 2023 Plan and previously granted options under the 2014 Plan. In addition, the Company issues common stock options to directors, new hires and occasionally to other employees not in connection with the annual grant process.

Finally, the Company periodically grants performance-based stock options which generally vest in connection with the achievement of specified commercial, regulatory and corporate milestones. The performance-based stock options also generally feature a time-based vesting component. 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 combined stock option activity for the year ended December 31, 2025, is as follows:


	Stock Options	Weighted-Average Exercise Price		Weighted-Average Contractual Life (years)	Aggregate Intrinsic Value (in thousands)
Outstanding, December 31, 2024	16,684,325	$	3.19	7.17 years	$	6,797
Granted	5,464,077	$	2.48
Exercised	(1,205,853)	$	1.40
Expired	(1,165,336)	$	8.67
Canceled and forfeited	(1,624,955)	$	1.99
Outstanding at December 31, 2025	18,152,258	$	2.85	6.97 years	$	3,690
Exercisable at December 31, 2025	9,819,097	$	3.56	5.59 years	$	2,624
Vested and expected to vest at December 31, 2025	18,152,258	$	2.85	6.97 years	$	3,690

The intrinsic value of options exercised during the years ended December 31, 2025 and 2024 was $1.8 million and $0.4 million, respectively. There was immaterial intrinsic value of options exercised during the year ended December 31, 2023, as the value of options exercised in 2023 was immaterial. The fair value of options that vested during the years ended December 31, 2025, 2024 and 2023 was $4.3 million, $3.7 million and $6.4 million, respectively. As of December 31, 2025, there was approximately $11.2 million of unrecognized compensation cost related to common stock options outstanding under the Company’s 2023 Plan or the 2014 Plan or made pursuant to the Company's inducement award program, which is expected to be recognized over a weighted average period of 2.64 years.

Restricted Stock Units

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 grant-date fair value of the RSUs is recognized as expense on a straight-line basis. The Company determines the fair value of the RSUs based on the closing price of the common stock on the date of the grants.

The Company also periodically grants performance-based restricted stock units, or PSUs, to employees under the 2023 Plan and previously granted PSUs under the 2014 Plan. The PSUs granted by the Company generally vest in connection with the achievement of specified commercial, regulatory and corporate milestones. The PSUs also generally feature a time-based

vesting component. 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.

In addition, the Company has granted PSUs to certain employees under the 2023 Plan with a market condition. The PSUs also generally feature a time-based vesting component. The Company uses a Monte Carlo simulation to determine fair value of the award at the grant date. The expense recognized for these awards is based on the calculated fair value multiplied by the number of the target units granted and is amortized over the service period.

RSU and PSU activity is as follows:


	2014 Plan		2023 Plan
	Number of Shares	Weighted Average Grant Date Fair Value	Number of Shares	Weighted Average Grant Date Fair Value
Unvested as of December 31, 2024	1,321,423	$0.95	4,108,367	$1.59
Granted	—	$0.00	4,492,000	$2.31
Vested	(849,701)	$1.06	(1,636,898)	$1.55
Forfeited and canceled	(141,100)	$0.98	(970,862)	$1.89
Unvested as of December 31, 2025	330,622	$0.63	5,992,607	$2.09

The total fair value of RSUs and PSUs that vested during 2025, 2024 and 2023 (measured on the date of vesting) was $3.4 million, $3.2 million and $8.4 million, respectively. As of December 31, 2025, there was approximately $7.7 million of unrecognized compensation cost related to RSUs and PSUs, which is expected to be recognized over a weighted average period of 1.73 years.

Employee Stock Purchase Plan

On June 6, 2019, the Company’s stockholders approved the Amended and Restated 2014 Employee Stock Purchase Plan, or ESPP. Under the ESPP substantially all employees may voluntarily enroll to purchase shares of the Company’s common stock through payroll deductions at a price equal to 85% of the lower of the fair market values of the stock as of the beginning or the end of the six-month offering period. An employee's payroll deductions under the ESPP are limited to 15% of the employee's compensation, and an employee may not purchase more than $25,000 worth of stock during any calendar year. In addition, an employee may not purchase more than 1,500 shares in any six-month offering period. As of December 31, 2025 and 2024, a total of 4,260,647 and 4,448,069 shares of the Company's common stock were available for future issuance under the ESPP, respectively. The Company issued 187,422 shares during the year ended December 31, 2025.

Stock-Based Compensation Expense

The Black-Scholes option pricing model is used to estimate the fair value of the common stock options. The weighted-average assumptions used in calculating the fair values of the rights to acquire stock under the 2023 Plan, the 2014 Plan and inducement awards were as follows:


	Years ended December 31,
Common Stock Options	2025			2024			2023
Risk-free interest rate	3.67%	-	4.38%	3.60%	-	4.66%	3.54%	-	4.81%
Expected volatility	111.61%	-	123.58%	109.98%	-	119.81%	100.97%	-	111.71%
Expected term (years)	5.51	-	6.25	5.51	-	6.25	5.51	-	6.25
Expected dividend yield	—%			—%			—%
Weighted average grant date fair value	$2.14			$1.36			$0.69

The Company has classified stock-based compensation in its consolidated statements of operations and comprehensive loss as follows (in thousands):


	Years ended December 31,
	2025		2024		2023
Cost of goods sold	$	683	$	399	267
Research and development	2,120		1,498		1,964
Selling, general and administrative	8,480		5,840		6,456
Restructuring	—		38		630
Total	$	11,283	$	7,775	$	9,317

Stock-based compensation by type of award was as follows (in thousands):


	Years ended December 31,
	2025		2024		2023
Stock options	$	5,356	$	4,036	$	5,310
Restricted stock units	5,214		3,655		3,637
Performance RSUs	545		—		297
Employee stock purchase plan	168		84		73
Total	$	11,283	$	7,775	$	9,317

Employee Retirement Plan

In 2008, the Company established a retirement plan, or the Plan, authorized by Section 401(k) of the Internal Revenue Code, or IRC. In accordance with the Plan, all employees who have attained the age of 21 are eligible to participate in the Plan as of the first Entry Date, as defined, following their date of employment. Each employee can contribute a percentage of compensation up to a maximum of the statutory limits per year. Company contributions are discretionary and contributions in the amount of approximately $1.9 million, $1.7 million and $1.7 million were made during the years ended December 31, 2025, 2024 and 2023, respectively.

Akebia Therapeutics, Inc. 10-K