8. Stock Options

        The Company adopted the 2007 Stock Incentive Plan, or the 2007 Plan, in November 2007, which terminated in accordance with its terms on November 28, 2017; however, the outstanding stock options may continue to be exercised in accordance with their terms.

        Immediately following the termination of the 2007 Plan, the Company adopted the 2017 Stock Incentive Plan, or the 2017 Plan, which contains substantially similar terms and conditions as the 2007 Plan. Upon the IPO, no further grants were made under the 2017 Plan and the Company adopted the 2018 Stock Incentive Plan, or the 2018 Plan. The purpose of the 2018 Plan is to promote the interest of the Company and its stockholders by aiding the Company in attracting and retaining employees, officers, consultants, independent contractors, and directors capable of assuring the future success of the Company's business and to afford such persons an opportunity to acquire a proprietary interest in the Company. The Board may amend, alter, suspend, discontinue, or terminate the 2018 Plan at any time with the approval of the stockholders of the Company.

        As of March 31, 2018, the number of shares reserved for issuance under the 2017 Plan was 2,945,384 shares. The exercise price of stock options represent fair value of the common stock at the time of issuance and is determined by the Board of Directors. The options granted contain fixed exercise prices ranging from $0.94 to $6.65 per share with varying expiration and exercise dates. The stock options granted by the Company to employees during the three months ended March 31, 2018 have a weighted average exercise price of $2.80 per share. The stock options granted include a four year service period and 25% vest after the first year of service and then pro rata over the next 36 months of service. The stock options have a contractual life of ten years.

        A summary of the Company's stock option activity and related information is as follows:

                                                                                                                                                                                    

        At March 31, 2018, the Company had 1,975,700 common stock options outstanding, with an average remaining contractual life of 5.2 years at a weighted average exercise price of $1.48 per share.

        Total stock-based compensation recognized, before taxes, during the three months ended March 31, 2018 and 2017, is as follows:

                                                                                                                                                                                    

        As of March 31, 2018, the amount of unearned stock-based compensation currently estimated to be expensed from now through the year 2022 related to unvested employee and non-employee director share-based awards is $295 and the weighted average period over which the unearned stock-based compensation is expected to be recognized is 3 years. If there are any modifications or cancellations of the underlying unvested securities, the Company may be required to accelerate, increase, or cancel any remaining unearned stock compensation expense. Future stock-based compensation expense and unearned stock-based compensation will increase to the extent that the Company grants additional share-based awards.

        The Company estimates the fair value of share-based awards on the date of grant using the Black-Scholes option pricing model using the fair market value of the Company's common stock on the date of grant and a number of other complex and subjective assumptions. These assumptions include, but are not limited to, estimates regarding the expected term of the Company's outstanding awards, estimates of the stock volatility over a duration that approximates the expected life of the Company's outstanding awards, estimates of the risk-free rate, and estimates of expected dividend rates.

        Due to the Company's limited amount of historical exercise, forfeiture, and expiration activity, the Company has opted to use the "simplified method" for estimating the expected term of options, whereby the expected term equals the arithmetic average of the vesting terms and the original contractual term of the option. The Company will continue to analyze its expected term assumption as more historical data becomes available. Due to the Company's limited operating history and a lack of company specific historical and implied volatility data, the Company has based its estimate of expected volatility on the historical volatility of a group of similar companies that are publicly traded. When selecting these public companies on which it has based its expected stock price volatility, the Company generally selected companies with comparable characteristics to it, including enterprise value, stages of clinical development, risk profiles, position within the industry, and with historical share price information sufficient to meet the expected life of the stock-based awards. The historical volatility data was computed using the daily closing prices for the selected companies' shares over historical periods that approximate calculated expected term of the Company's share-based awards. The Company will continue to analyze the historical stock price volatility assumption as more historical data for the Company's common stock becomes available.

        The risk-free rate assumption is based on the U.S. Treasury instruments with maturities similar to the expected term of the Company's stock options.

        The expected dividend assumption is based on the Company's history of not paying dividends and its expectation that it will not declare dividends for the foreseeable future.

        The amount of stock-based compensation expense recognized is based on awards ultimately expected to vest. The amount of expense recognized by the Company has been reduced by actual forfeitures as they occur.

        The fair value of options granted to employees or non-employee directors during the three months ended March 31, 2018 and 2017 was estimated as of the grant date using the Black-Scholes option pricing model, assuming the weighted average assumptions listed in the following table: