later than ~~May 17, 2021,~~ten days before the Annual Meeting, so that you can be provided with a control number and cast your vote electronically during the Annual Meeting.

Will a replay of the Annual Meeting be available?

A replay of the Annual Meeting will be made publicly available 24 hours after the meeting at www.virtualshareholdermeeting.com/~~ICPT2021~~ICPT2022 and for two weeks thereafter.

Will a list of stockholders be made available?

Yes. A list of stockholders of record will be available electronically during the Annual Meeting at www.virtualshareholdermeeting.com/~~ICPT2021,~~ICPT2022, and, during the ten days prior to the Annual Meeting, at our principal executive offices located at ~~10 Hudson Yards, 37th Floor, New York, NY 10001.~~305 Madison Avenue, Morristown, NJ 07960.

What vote is required to approve each proposal?

Approval of Proposals 1A through 1K each requires a plurality of the votes cast in person or by proxy at the Annual Meeting.

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Approval of ~~Proposal~~Proposals 2, 3, and 4 requires the affirmative vote of a majority of the shares cast affirmatively or negatively in person or by proxy at the Annual Meeting.

~~Approval of Proposal 3 requires the affirmative vote of a majority of the shares cast affirmatively or negatively in person or by proxy at the Annual Meeting.~~

~~For Proposal 4, the frequency (every one, two, or three years) that receives the most votes will be considered approved.~~

~~Approval of Proposal 5 requires the affirmative vote of a majority of the shares cast affirmatively or negatively in person or by proxy at the Annual Meeting.~~

Abstentions may be specified for Proposals 2, 3, 4, and 5.4.

~~For Proposals 1A through 1K, broker~~Broker non-votes ~~if any,~~and abstentions have no ~~effects~~effect on ~~the results of the relevant votes.~~

~~For Proposals 2, 3, 4, and 5, abstentions and broker non-votes, if any, have no effects on the results of the relevant votes.~~voting results.

What is the quorum requirement?

A “quorum” must be present for the Annual Meeting to be held. A quorum ~~will be~~is present if ~~the~~ holders of a majority of ~~the voting power of all of the~~ shares entitled to vote ~~at the Annual Meeting~~ are present or represented by ~~proxy at the Annual Meeting.~~proxy. Shares present or represented by proxy, ~~at the Annual Meeting,~~ including broker non-votes and shares that abstain or do not vote with respect to one or more ~~of the~~ proposals, will be counted for purposes of determining a quorum. If there is no quorum, the Annual Meeting may be adjourned ~~from time to time,~~ by the chairman of the Annual Meeting.

Will my shares be voted if I do not provide a proxy?

If your shares are registered directly in your name with our transfer agent, they will not be counted if you do not vote as described above under “How do I vote?”

If your shares are held in street name, your shares may be voted even if you do not provide voting instructions to the ~~bank, broker, or other~~ nominee through which the shares are held. These entities have the authority, under applicable regulations, to vote shares for which their customers do not provide voting instructions, on certain “routine” matters. Proposal 54 is considered a “routine” matter for which these entities may vote unvoted shares.

Proposals 1A through 1K, 2, 3, and 43 are not considered “routine” matters for which these entities may vote unvoted shares. Accordingly, if you hold your shares in street name and have not provided voting instructions, ~~the bank, broker, or other~~your nominee ~~through which the shares are held~~ is not permitted to vote

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your shares with respect to the election of directors; the approval of the one-time stock option exchange program for non-executive employees; the approval, on a non-binding, advisory basis, of the compensation of the Company’s named executive officers; or the frequency of votes on named executive officer compensation.these matters. Such failure to vote is called a “broker non-vote”. We strongly encourage you to submit your proxy and exercise your right to vote as a stockholder.

What if I return a proxy card or otherwise submit a proxy but do not make specific choices?

If you return a signed and dated proxy card or otherwise submit a proxy (online or in hard copy) without voting on a proposal, your shares will be voted on such proposal ~~in the manner set forth below:~~

~~FOR the election of each of the eleven nominees to serve~~based on the Board ~~until~~recommendations set forth above. If any other matter comes before the ~~2022~~ Annual Meeting, ~~of Stockholders or until their respective successors are duly elected and qualified (Proposals 1A through 1K).~~

~~FOR the approval of a one-time stock option exchange program for non-executive employees (Proposal 2).~~

~~FOR the approval of the compensation of the Company’s named executive officers (Proposal 3).~~

~~That the stockholder advisory vote on the compensation of the Company’s named executive officers should occur every ONE YEAR (Proposal 4).~~

~~FOR the ratification of the appointment of KPMG LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2021 (Proposal 5).~~

~~In the manner that~~ the proxy holders will exercise your proxy as they deem ~~appropriate for any other proposal to be considered at the Annual Meeting.~~

appropriate.

May I revoke my proxy?

If you are a holder of record, you may revoke your proxy before it is voted at the Annual Meeting by:

•

Submitting another properly completed proxy card with a later date and returning it as instructed on the card ~~so that~~with enough time for it isto be received ~~by the Company at least one hour prior to the commencement of~~and processed before the Annual Meeting;

•

Submitting a new proxy ~~via the Internet~~online prior to the deadline listed onin the proxy ~~card;~~instructions;

•

Providing written notice received by the Secretary of the Company at least one hour prior to the commencement of the Annual Meeting; or

•

Attending the Annual Meeting and voting in accordance with the requirements described in this proxy statement.

If you are a beneficial holder whose shares are held in street name, you may submit new voting instructions by contacting ~~the bank, broker, or other~~your nominee through which you hold your shares. You may also vote at the Annual Meeting using your unique 16-digit control number included in your proxy ~~materials or on your proxy card.~~materials.

Who is making and paying for this proxy solicitation?

This proxy is solicited on behalf of the Board. The Company will pay the cost of distributing this proxy statement and related materials. Upon request, the Company will reimburse ~~banks, brokers, and other~~ nominees for reasonable expenses they incur in forwarding proxy materials to beneficial ~~owners of the Company’s shares. The Company has retained Innisfree M&A Incorporated to assist in the solicitation of proxies for a fee of approximately $17,500, plus out-of-pocket expenses.~~owners. Certain of the Company’s directors,

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officers, and employees may participate in the solicitation of proxies, including electronically or by mail or telephone, without additional compensation.

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What does it mean if I receive more than one set of proxy materials?

If you receive more than one set of proxy materials, your shares may be registered in more than one name or in different accounts. Please submit proxies for all of your shares.

I share an address with another stockholder and we received only one ~~Annual Report and one~~set of proxy ~~statement.~~materials. How ~~may~~do I obtain an additional ~~copy of the Annual Report and proxy statement?~~materials?

We have adopted a procedure called “householding”, under which only one ~~Annual Report and one~~set of proxy ~~statement~~materials will be mailed to multiple stockholders sharing an address unless the Company receives contrary instructions from one or more of the ~~stockholders sharing an address.~~stockholders. If your household has received only one ~~Annual Report and one~~set of proxy ~~statement~~materials, and you wish to receive separate copies, ~~of these documents,~~ please follow the instructions ~~set forth~~below under “Householding”.

How can I find out the results of the voting at the Annual Meeting?

WeWithin four business days after the Annual Meeting, we will publish the voting results ~~of the Annual Meeting~~ in a Current Report on Form ~~8-K within four business days after the Annual Meeting.~~8-K.

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~~Cautionary Note Regarding Forward-Looking Statements~~CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This proxy statement contains forward-looking statements, including, but not limited to, statements regarding the progress, timing and results of our clinical trials, including our clinical trials for the treatment of nonalcoholic steatohepatitis (“NASH”), the safety and efficacy of our approved product, Ocaliva (obeticholic acid or “OCA”) for primary biliary cholangitis (“PBC”), and our product candidates, including OCA for liver fibrosis due to NASH, the timing and acceptance of our regulatory filings and the potential approval of OCA for liver fibrosis due to NASH, the review of our New Drug Application for OCA for the treatment of liver fibrosis due to NASH by the U.S. Food and Drug Administration (the “FDA”), our intent to work with the FDA to address the issues raised in a complete response letter (“CRL”), the potential commercial success of OCA, as well as our strategy, future operations, future financial position, future revenue, projected costs, financial guidance, prospects, plans and objectives.

These statements constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “target,” “potential,” “will,” “would,” “could,” “should,” “possible,” “continue” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this proxy statement, and we undertake no obligation to update any forward-looking statement except as required by law. These forward-looking statements are based on estimates and assumptions by our management that, although believed to be reasonable, are inherently uncertain and subject to a number of risks.

The following represent some, but not necessarily all, of the factors that could cause actual results to differ materially from historical results or those anticipated or predicted by our forward-looking statements:

•

our ability to successfully commercialize Ocaliva for PBC;

•

our ability to maintain our regulatory approval of Ocaliva for PBC in the United States, Europe, Canada, Israel, Australia and other jurisdictions in which we have or may receive marketing authorization;

•

our ability to timely and cost-effectively file for and obtain regulatory approval of our product candidates on an accelerated basis or at all, including OCA for liver fibrosis due to NASH following the issuance of the CRL by the FDA; any advisory committee recommendation or dispute resolution determination that our product candidates, including OCA for liver fibrosis due to NASH, should not be approved or approved only under certain conditions; or any future determination that the regulatory applications and subsequent information we submit for our product candidates, including OCA for liver fibrosis due to NASH, do not contain adequate clinical or other data or meet applicable regulatory requirements for approval;

•

conditions that may be imposed by regulatory authorities on our marketing approvals for our products and product candidates, including OCA for liver fibrosis due to NASH, such as the need for clinical outcomes data (and not just results based on achievement of a surrogate endpoint), any risk mitigation programs such as a ~~REMS,~~Risk Evaluation and Mitigation Strategies (“REMS”) program, and any related restrictions, limitations and/or warnings contained in the label of any of our products or product candidates;

•

any potential side effects associated with Ocaliva for PBC, OCA for liver fibrosis due to NASH or our other product candidates that could delay or prevent approval, require that an approved product be taken off the market, require the inclusion of safety warnings or precautions, or otherwise limit the sale of such product or product candidate, including in connection with our update to the ~~newly identified safety signal (“NISS”) relating to~~ Ocaliva ~~identified by the FDA~~prescribing information in May ~~2020;~~2021 contraindicating Ocaliva for patients with PBC and decompensated cirrhosis, a prior decompensation event, or compensated cirrhosis with evidence of portal hypertension;

•

the initiation, timing, cost, conduct, progress and results of our research and development

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activities, preclinical studies and clinical trials, including any issues, delays or failures in identifying patients, enrolling patients, treating patients, retaining patients, meeting specific endpoints in the jurisdictions in which we intend to seek approval or completing and timely reporting the results of our NASH or PBC clinical trials;

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•

the outcomes of ~~ongoing discussions~~interactions with regulators (e.g., the FDA and the European Medicines Agency (“EMA”)) regarding ~~the feasibility of the COBALT and 401~~our clinical trials;

•

our ability to establish and maintain relationships with, and the performance of, third-party manufacturers, contract research organizations and other vendors upon whom we are substantially dependent for, among other things, the manufacture and supply of our products, including Ocaliva for PBC and, if approved, OCA for liver fibrosis due to NASH, and our clinical trial activities;

•

our ability to identify, develop and successfully commercialize our products and product candidates, including our ability to successfully launch OCA for liver fibrosis due to NASH, if approved;

•

our ability to obtain and maintain intellectual property protection for our products and product candidates, including our ability to cost-effectively file, prosecute, defend and enforce any patent claims or other intellectual property rights;

•

the size and growth of the markets for our products and product candidates and our ability to serve those markets;

•

the degree of market acceptance of Ocaliva for PBC and, if approved, OCA for liver fibrosis due to NASH or our other product candidates among physicians, patients and healthcare payors;

•

the availability of adequate coverage and reimbursement from governmental and private healthcare payors for our products, including Ocaliva for PBC and, if approved, OCA for liver fibrosis due to NASH, and our ability to obtain adequate pricing for such products;

•

our ability to establish and maintain effective sales, marketing and distribution capabilities, either directly or through collaborations with third parties;

•

competition from existing drugs or new drugs that become available;

•

our ability to attract and retain key personnel to manage our business effectively;

•

our ability to prevent or defend against system failures or security or data breaches due to cyber-attacks, or ~~violations of~~cyber intrusions, including ransomware, phishing attacks and other malicious intrusions;

•

our ability to comply with data protection laws;

•

costs and outcomes relating to any disputes, governmental inquiries or investigations, regulatory proceedings, legal proceedings or litigation, including any securities, intellectual property, employment, product liability or other litigation;

•

our collaborators’ election to pursue research, development and commercialization activities;

•

our ability to establish and maintain relationships with collaborators with development, regulatory and commercialization expertise;

•

our need for and ability to generate or obtain additional financing;

•

our estimates regarding future expenses, revenues and capital requirements and the accuracy thereof;

•

our use of cash, cash equivalents and short-term investments;

•

our ability to acquire, license and invest in businesses, technologies, product candidates and products;

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•

our ability to manage the growth of our operations, infrastructure, personnel, systems and controls;

•

our ability to obtain and maintain adequate insurance coverage;

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•

~~the impact of~~continuing threats from COVID-19, including ~~any impact on our results~~additional waves of ~~operations or financial position, related~~infections, and their impacts including quarantines and other government ~~actions,~~actions; delays relating to our regulatory ~~applications,~~applications; disruptions relating to our ongoing clinical trials or involving our contract research organizations, study sites or other clinical ~~partners,~~partners; disruptions relating to our supply chain or involving our third-party manufacturers, distributors or other distribution ~~partners,~~partners; and facility closures or other ~~restrictions,~~restrictions; and the ~~extent~~impact of the foregoing on our results of operations and ~~duration thereof;~~financial position;

•

the impact of general U.S. and foreign economic, industry, market, regulatory or political conditions, including the ~~potential~~ impact of Brexit; and

•

the other risks and uncertainties identified in our periodic filings filed with the U.S. Securities and Exchange Commission (the “SEC”), including our Annual Report.

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~~Proposals Under Vote~~

~~Proposals~~PROPOSALS UNDER VOTE

PROPOSALS 1A ~~Through~~THROUGH 1K:

~~Election of Directors~~

ELECTION OF DIRECTORS

The Board currently consists of ~~twelve~~eleven directors. Our directors are elected annually to serve one-year terms. Each of our directors is standing for election at the Annual ~~Meeting, other than Daniel Welch, who is retiring from the Board.~~Meeting.

The following table sets forth the names, ages ~~tenures,~~(as of March 31, 2022), and current committee memberships of our ~~directors as of April 27, 2021, except for Mr. Welch.~~directors.

Director	Age		Director Since		Age		Director Since
Paolo Fundarò(1)		47		2006		48		2006
Jerome Durso		53		2021		54		2021
Srinivas Akkaraju, M.D., Ph.D.~~(2)~~(6)		53		2012		54		2012
Luca Benatti, Ph.D.~~(3)~~(6)		60		2014		61		2014
Daniel Bradbury~~(4)~~(5)		60		2016		60		2016
Keith Gottesdiener, M.D.~~(2)~~(6)		67		2016		68		2016
Nancy Miller-Rich(5)		62		2018
Nancy Miller-Rich(4)(5)						63		2018
Mark Pruzanski, M.D.(6)		53		2002		54		2002
Dagmar Rosa-Bjorkeson(4)		57		2021		58		2021
Gino Santini~~(6)~~(4)		64		2015		65		2015
Glenn Sblendorio~~(4)~~(3)		65		2014		66		2014

(1)

Chairman of the Board.

(2)

~~Member of the Research and Development Committee.~~Lead Independent Director.

(3)

~~Member of the Nominating and Governance Committee.~~Audit Committee member.

(4)

~~Member of the Audit Committee.~~Compensation Committee member.

(5)

~~Member of the Compensation Committee.~~Nominating and Governance Committee member.

(6)

~~Lead Independent Director.~~Research and Development Committee member.

The Board has nominated each of the individuals set forth in the table above for election as directors at the Annual Meeting. The election of each ~~of the nominees recommended for election as directors~~nominee requires a plurality of the votes cast in person or by proxy at the Annual Meeting. If elected, each ~~of these individuals~~individual will serve on the Board until ~~the 2022~~our 2023 Annual Meeting ~~of Stockholders~~ or until his or her respective successor is duly elected and qualified. If any ~~of these individuals~~individual should become unable to accept election, the persons named as proxies may vote for a substitute nominee selected by the Board or by the named proxies, unless the Board chooses to reduce the number of directors ~~serving~~ on the Board. Each ~~of these individuals~~nominee has agreed to serve if elected, and the Company’s management has no reason to believe that any nominee will be unable to serve.

The names, principal occupations, and other information concerning the nominees are set forth below, including the specific experience, qualifications, attributes, and skills that led the Board to determine that the nominees should serve as directors. There are no family relationships between or among any of our directors or executive officers. For more information regarding the independence of our directors, please see “Board of Directors and Governance—Independence”.

Paolo Fundarò has served as our Chairman since October 2015 and as a member of our Board since 2006. Mr. Fundarò has been the Chief Executive Officer of Genextra S.p.A., an investment firm focused on the life sciences industry, since July 2019 and previously served as the Chief Financial Officer of Genextra S.p.A. from its inception in 2004 until 2019. Mr. Fundarò is also the CEO of XGen Ventures S.G.R. S.p.A., a venture capital firm focused on the life science sector he co-founded in 2021 with other members of the

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Genextra team. Mr. Fundarò also has served as Managing Director of certain of Genextra’s portfolio companies, including Congenia S.r.l. ~~since~~from 2004 to December 2020, Dac S.r.l. from 2004 until

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December 2016, and Tethis S.p.A. from 2004 until July 2016. Before joining Genextra, Mr. Fundarò was Director of Finance and Strategic Planning for the Fastweb Group from 2000 to 2004. Earlier in his career, Mr. Fundarò worked for investment banks Salomon Smith Barney (now Citigroup) and Donaldson, Lufkin & Jenrette (now Credit Suisse). Mr. Fundarò serves on the board of directors of a number of private and non-U.S. public companies, including Genextra S.p.A. and Tiscali S.p.A. Mr. Fundarò received a degree in Business Management from Bocconi University in Milan, Italy.

Mr. Fundarò’s significant experience in venture capital, corporate finance and strategic planning, as well as his expertise in building, investing in, and growing companies in diverse industries, including the biopharmaceutical industry, contributed to the Board’s determination that he should be nominated to serve as a director.

Jerome Durso has been our President and Chief Executive Officer, and a director, since January 2021. Prior to becoming Chief Executive Officer, Mr. Durso served as Chief Operating Officer since joining Intercept in February 2017. Mr. Durso has over 25 years of experience in building and leading commercial and business operations at life sciences companies both in the United States and abroad. Prior to joining the Company, Mr. Durso served as a consultant to the biopharmaceutical industry from September 2015 to February 2017. Mr. Durso spent the majority of his career at Sanofi, a global pharmaceutical company, where he most recently served as ~~Senior Vice President,~~SVP, Chief Commercial Officer of the Global Diabetes Division from June 2011 to April 2015. From 2010 to 2011, Mr. Durso was Senior Vice President, Chief Commercial Officer of Sanofi’s U.S. pharmaceuticals business. Prior to that, he served in a number of commercial leadership roles of increasing responsibility in business unit and brand management, marketing, and sales since he first joined Sanofi in 1993. Mr. Durso earned his bachelor’s degree in marketing from the University of Notre Dame.

Mr. Durso’s detailed business understanding of the pharmaceutical industry, and of the Company in particular, including from operating, managerial, marketing, and sales perspectives, contributed to the Board’s determination that he should be nominated to serve as a director.

Srinivas Akkaraju, M.D., Ph.D. has served as a member of our Board since October 2012. Since March 2017, Dr. Akkaraju has been the Managing General Partner of Samsara BioCapital, a venture capital firm that he founded. From April 2013 to March 2017, Dr. Akkaraju was a General Partner and then a Senior Advisor of Sofinnova Ventures, a venture capital firm focused on the life sciences industry. From January 2009 until April 2013, Dr. Akkaraju was a Managing Director of New Leaf Venture Partners, an investment firm focused on the healthcare technology sector. From 2006 to 2008, Dr. Akkaraju served as a Managing Director of Panorama Capital, a venture capital firm that he co-founded along with other members of the former venture capital investment team of J.P. Morgan Partners, a private equity division of JPMorgan Chase & Co. Prior to co-founding Panorama Capital, Dr. Akkaraju was with J.P. Morgan Partners, which he joined in 2001 and of which he became a partner in 2005. From 1998 to 2001, Dr. Akkaraju worked in business and corporate development at Genentech, Inc. (now a member of the Roche Group), a biotechnology company. Dr. Akkaraju has been a director of Jiya Acquisition Corp. (where he also serves as Chairman) since November 2020, and Syros Pharmaceuticals, Inc. since June 2017. Dr. Akkaraju also serves on the board of directors of a number of private companies. During the past five years, Dr. Akkaraju previously served as a director of Aravive, Inc. (formerly Versartis, Inc.), aTyr Pharma, Inc., Principia Biopharma Inc., and Seattle Genetics, Inc. (now Seagen Inc.). Dr. Akkaraju received his M.D. and a Ph.D. in Immunology from Stanford University. He received his undergraduate degrees in Biochemistry and Computer Science from Rice University.

Dr. Akkaraju’s extensive experience in venture capital, in-depth knowledge of life sciences companies, and financial expertise, as well as his scientific background and public company board experience, contributed to the Board’s determination that he should be nominated to serve as a director.

Luca Benatti, Ph.D. has served as a member of our Board since July 2014. Dr. Benatti has over 30 years of experience in the pharmaceutical and biotechnology industries. Since June 2012, Dr. Benatti has served as the Chief Executive Officer and a director of EryDel S.p.A., a private biotechnology company focused on rare diseases. From 1998 until May 2012, Dr. Benatti was Chief Executive Officer of Newron

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Pharmaceuticals S.p.A., a publicly traded biopharmaceutical company that Dr. Benatti co-founded. Under Dr. Benatti’s leadership, Newron developed a pipeline of innovative therapies including Xadago, approved

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worldwide for the treatment of Parkinson’s disease. From 1985 to 1998, Dr. Benatti held various research and development positions at Pharmacia & Upjohn and its predecessor companies. Dr. Benatti has authored several scientific publications and holds a number of patents. Dr. Benatti currently serves as a director of Newron Pharmaceuticals S.p.A. and Metis Precision Medicine. Dr. Benatti also serves as chairman of Italian Angels for Biotech, a member of the Advisory Board of the Sofinnova Telethon Fund, as chairman of the Scientific Advisory Board of Gain Therapeutics, and a member of the Strategic and Development Advisory ~~Board~~Boards of Zambon S.p.A. Dr. Benatti graduated from and performed his post-doctoral training at the Milano Genetics Institute.

Dr. Benatti’s significant experience in the pharmaceutical and biotechnology industries; business development, financial, and strategic leadership expertise; and thorough understanding of pharmaceutical drug discovery and development, contributed to the Board’s determination that he should be nominated to serve as a director.

Daniel Bradbury has served as a member of our Board since July 2016. Mr. Bradbury has over 35 years of experience leading global, fast-growing life sciences companies. Mr. Bradbury has served as Executive Chairman of Equillium, Inc., a biopharmaceutical company that Mr. Bradbury co-founded, since January 2020 and served as Chairman of Equillium, Inc. from March 2018 through December 2019. Mr. Bradbury also previously served as Chief Executive Officer of Equillium, Inc., from June 2018 through December 2019 and as President of Equillium, Inc. from March 2017 until June 2018. In addition, Mr. Bradbury has been Managing Member of BioBrit, LLC, a life sciences consulting and investment firm, since 2012. Previously, Mr. Bradbury held several senior positions at Amylin Pharmaceuticals, Inc., a biopharmaceutical company focused on diabetes and metabolic disorders, including President and Chief Executive Officer from March 2007 until its acquisition by Bristol-Myers Squibb Company in August 2012, President and Chief Operating Officer from 2006 to 2007, Chief Operating Officer from 2003 to 2006, Executive Vice President from 2000 to 2003 and Senior Vice President, Corporate Development from 1998 to 2000. Mr. Bradbury also served as a director of Amylin from June 2006 to August 2012. Prior to joining Amylin in 1994, Mr. Bradbury worked at SmithKline Beecham Pharmaceuticals and its predecessor companies for ten years in various sales and marketing positions. Mr. Bradbury has been a director of Castle Biosciences, Inc. since September 2012 and serves on the board of directors of a number of private companies and philanthropic organizations. During the past five years, Mr. Bradbury previously served as a director of Panacea Acquisition Corp. (now Nuvation Bio Inc.), Geron Corporation, Corcept Therapeutics Incorporated, Illumina, Inc. and BioMed Realty Trust, Inc. In addition, Mr. Bradbury serves on the Keck Graduate Institute’s Board of Trustees and the University of California San Diego’s Rady School of Management Dean’s Advisory Council. Mr. Bradbury received a Bachelor of Pharmacy from Nottingham University and a Diploma in Management Studies from Harrow and Ealing Colleges of Higher Education in the United Kingdom.

Mr. Bradbury has extensive experience in the biopharmaceutical industry, has demonstrated leadership and operational skills, and possesses significant research, development, and commercialization expertise, as well as public company board experience. These factors contributed to the Board’s determination that he should be nominated to serve as a director.

Keith Gottesdiener, M.D. has served as a member of our Board since July 2016. Since July 2020, Dr. Gottesdiener has served as the Chief Executive Officer and as a director of Prime Medicine, Inc., a private biopharmaceutical company based in Cambridge, Massachusetts. Prior to that, from October 2011 until March 2020, Dr. Gottesdiener served as the Chief Executive Officer and a director of Rhythm Pharmaceuticals, Inc., a biopharmaceutical company. Dr. Gottesdiener joined Rhythm after 16 years at Merck Research Laboratories, where he held positions of increasing responsibility, including serving as a leader of Merck’s late clinical development organization from 2006 to 2011 and leading Merck’s early clinical development across all therapeutic areas from 2001 through early 2006. In such roles, Dr. Gottesdiener oversaw the development of Merck’s infectious diseases and vaccine products through pivotal trials, registration, and life cycle management, including GardasilTM (HPV Vaccine), RotateqTM (rotavirus vaccine), ZostavaxTM (zoster vaccine) and IsentressTM (HIV integrase inhibitor), among others. In 2008, Dr. Gottesdiener was appointed Late Stage Therapeutic Group Leader, and in that role led

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Merck’s late-stage clinical development efforts (from Phase 2 through patent expiry) across all therapeutic areas. After Merck’s merger with Schering-Plough Corporation in 2009, he continued as Co-Head of Late Development. Dr. Gottesdiener received his B.A. from Harvard College and his M.D. from the University

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of Pennsylvania. He completed his residency and fellowship at the Brigham and Women’s Hospital-Beth Israel Medical Center-Dana Farber Cancer Institute Children’s Hospital programs. After his fellowship, Dr. Gottesdiener did postdoctoral research in the laboratory of Dr. Jack Strominger at Dana Farber Cancer Institute working on the molecular immunology of the T-cell receptor. In 1986, he joined the faculty as an assistant professor at Columbia University, started an independent research laboratory with NIH RO-1 funding, focusing on gene transcription, and was Associate Clinical Professor of Medicine at the time he left to join Merck in 1995.

Dr. Gottesdiener’s extensive experience as a senior executive in the pharmaceutical industry, drug development and regulatory affairs expertise, and research work for both medical and academic institutions, as well as his public company experience, contributed to the Board’s determination that he should be nominated to serve as a director.

Nancy Miller-Rich has served as a member of our Board since April 2018. Ms. Miller-Rich has 35 years of experience in the healthcare industry, with significant expertise in business development and commercial strategy. Since September 2017, Ms. Miller-Rich has served as a consultant to the pharmaceutical industry. Previously, Ms. Miller-Rich served in a number of leadership roles at Merck & Co., Inc. and, prior to the merger of the two companies, at Schering-Plough Corporation, including most recently as ~~Senior Vice President,~~SVP, Global Human Health Business Development & Licensing, Strategy and Commercial Support from November 2013 to September 2017 and as Group ~~Vice President,~~VP, Consumer Care Global New Ventures and Strategic Commercial Development from January 2007 to November 2013. Prior to joining Schering-Plough in 1990, Ms. Miller-Rich served in a variety of commercial and marketing roles at Sandoz Pharmaceuticals and Sterling Drug, Inc. She is currently a director of Aldeyra Therapeutics, Inc., ~~Kadmon Holdings, Inc.,~~ and 4D Molecular Therapeutics, Inc., as well as a board member of a number of private and not-for-profit entities. During the past five years, Ms. Miller-Rich previously served as a director of Kadmon Holdings, Inc., and UDG Healthcare plc. She received her B.S. in Business Administration, Marketing from Ithaca College in Ithaca, New York.

Ms. Miller-Rich’s significant experience in the healthcare industry, as well as her business development and commercial strategy expertise, contributed to the Board’s determination that she should be nominated to serve as a director.

Mark Pruzanski, M.D. ~~is one of our co-founders~~founded Intercept and has served as a member of our Board since its inception in 2002. Dr. Pruzanski served as ~~Intercept’s~~the company’s President and Chief Executive Officer until 2021. ~~Dr. Pruzanski~~He has over 2025 years of experience in life sciences company management, venture capital and strategic consulting. ~~Prior to co-founding Intercept,~~Previously, Dr. Pruzanski was a venture partner at Apple Tree Partners, an early stage life sciences venture capital firm that he co-founded, and an entrepreneur-in-residence at Oak Investment Partners, a venture capital firm. Dr. Pruzanski is a co-author of a number of scientific publications and is named as an inventor on several of our patents. In 2021, Dr. Pruzanski served as a consultant and strategic advisor to Intercept. Since January 2021, Dr. Pruzanski has been the Managing Member of Figurati LLC, a life sciences investment and consulting firm. Dr. Pruzanski has been a director of Equillium, Inc. since September 2018. ~~Dr. Pruzanski~~He also currently serves on the boards of several private biotechnology companies. Further, he currently serves on the boards of the Emerging Companies Section of the Biotechnology Innovation Organization (BIO), a biotechnology-focused trade association, and the Foundation for Defense of Democracies, a non-profit policy institute focusing on foreign policy and national security. Dr. Pruzanski received his M.D. from McMaster University in Hamilton, Canada, a M.A. degree in International Affairs from the Johns Hopkins University School of Advanced International Studies in Bologna, Italy and Washington, D.C., and a bachelor’s degree from McGill University in Montreal, Canada.

Dr. Pruzanski’s comprehensive knowledge of the Company and both its business and scientific aspects, and his general experience with managing, advising, and investing in life sciences companies, contributed to the Board’s determination that he should be nominated to serve as a director.

Dagmar Rosa-Bjorkeson has served as a member of our Board since April 2021. She has more than 25 years of global experience in the pharmaceutical industry, including executive leadership positions in corporate and product strategy, market development, and operational execution. Since 2020, she has been

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the Chief Operating Officer of Mesoblast Limited. From 2017 to 2019, she worked at Mallinckrodt Pharmaceuticals, where she was ~~Executive Vice President~~EVP and Chief Strategy and Development Officer, responsible for corporate and therapeutic area strategy, business development, and new product

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commercialization, and also served as Senior Vice President of new product commercialization. From ~~2015~~2014 to 2016, she was ~~Executive Vice President~~EVP and President, Biosimilars, at Baxalta (now a wholly owned subsidiary of Takeda Pharmaceutical Company), where she developed a biosimilars strategy, managed post spin-off efforts from Baxter International, and oversaw a fully integrated unit including program management, research, clinical development, manufacturing, commercialization and business development. From 1997 to 2014, she held various roles of increasing responsibility at Novartis, including Vice President and Head of its multiple sclerosis business unit; Vice President, Business Development and Licensing in the United States; Vice President, Respiratory in the United States; and Country Head and President for Novartis Sweden. Throughout her 17 years at Novartis, Ms. Rosa-Bjorkeson’s experience spanned sales, marketing, general management, and country operations. She has led multiple successful product launches, including Gilenya® for multiple sclerosis at Novartis. She serves on the board of directors of Xencor, Inc., ~~as well as~~on the board of private company Red Nucleus, and on the non-profit boards of the New Jersey City University Foundation and Deirdre’s House. Ms. Rosa-Bjorkeson earned an M.B.A., an M.S. in chemistry, and a B.S. in chemistry from the University of Texas, Austin.

Ms. Rosa-Bjorkeson has deep experience in the pharmaceutical industry, including in the areas of management, operations, strategy, and product commercialization, contributing to the Board’s determination that she should be nominated to serve as a director.

Gino Santini has served as our Lead Independent Director since February 2018 and as a member of our Board since November 2015. From 1983 to 2010, Mr. Santini held a variety of commercial, operational and leadership roles of increasing responsibility at Eli Lilly and Company, including ~~Senior Vice President,~~SVP, Corporate Strategy and Business Development from 2007 to 2010, ~~Senior Vice President~~SVP of Corporate Strategy and Policy from 2004 to 2007, President of U.S. Operations from 1999 to 2004 and President of the Women’s Health Franchise from 1997 to 1999. Mr. Santini has been a director of Allena Pharmaceuticals, Inc. since February 2012, Horizon Therapeutics plc since March 2012, and Collegium Pharmaceutical, Inc. since July 2012. Mr. Santini also serves on the board of directors of a number of private companies. During the past five years, Mr. Santini previously served as a director of AMAG Pharmaceuticals, Inc., and Vitae Pharmaceuticals, Inc. Mr. Santini holds an undergraduate degree in mechanical engineering from the University of Bologna and an M.B.A. from the Simon School of Business, University of Rochester.

Mr. Santini has extensive experience in the pharmaceutical industry, has demonstrated leadership and operational skills, and possesses significant domestic and international commercial, corporate strategy, business development, and transactional experience, as well as public company board experience. These factors contributed to the Board’s determination that he should be nominated to serve as a director.

Glenn Sblendorio has served as a member of our Board since February 2014. Mr. Sblendorio has over 3035 years of experience in the pharmaceutical and biotechnology industries. Mr. Sblendorio has been ~~Chief Executive Officer,~~CEO, President and a director of IVERIC bio, Inc. (formerly Ophthotech Corporation) since July 2017, January 2017 and May 2017, respectively. Mr. Sblendorio also previously served at IVERIC bio, Inc. as ~~Executive Vice President~~EVP and ~~Chief Operating Officer~~COO from April 2016 to January 2017, ~~Chief Financial Officer~~CFO and Treasurer from April 2016 until April 2017 and a director from July 2013 through March 2016. Prior to joining IVERIC bio, Inc., Mr. Sblendorio served as the President and ~~Chief Financial Officer~~CFO of The Medicines Company from March 2006 until December 2015. He also served on the Board of Directors for The Medicines Company from 2012 through 2015. Mr. Sblendorio served as ~~Executive Vice President~~EVP and ~~Chief Financial Officer~~CFO of Eyetech Pharmaceuticals, Inc. from February 2002 until it was acquired by OSI Pharmaceuticals, Inc. in November 2005. From July 2000 to February 2002, Mr. Sblendorio served as ~~Senior Vice President~~SVP of Business Development at The Medicines Company. Prior to joining The Medicines Company in 2000, Mr. Sblendorio served as a managing director at MPM Capital Advisors, LLC and held a variety of senior financial positions at Hoffman-La Roche, Inc. Mr. Sblendorio has been a director of Amicus Therapeutics, Inc. since June 2006. Mr. Sblendorio received a B.B.A. from Pace University and an M.B.A. from Fairleigh Dickinson University. He is also a graduate of the Harvard Advanced Management Program.

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Mr. Sblendorio’s extensive experience in the pharmaceutical and biotechnology industries, leadership skills, operational and strategic expertise, and financial knowledge (which enables him to serve as a financial expert on our Audit Committee), as well as his public company board experience, and strong record of dedication to service on our Board, contributed to the Board’s determination that he should be nominated to serve as a director.

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Vote Required for Approval

The election, by separate resolutions, of each ofnominee to the ~~foregoing eleven nominees to serve on the~~ Board ~~of Directors until the 2022 Annual Meeting of Stockholders, or until their respective successors are duly elected and qualified,~~ requires a plurality of the votes cast in person or by proxy at the Annual Meeting.

THE BOARD RECOMMENDS A VOTE “FOR”
THE ELECTION OF EACH NOMINEE SET FORTH ABOVE.

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PROPOSAL 2:

APPROVAL OF OUR AMENDED AND RESTATED EQUITY INCENTIVE PLAN

Overview

The Board ~~recommends~~requests that stockholders approve our Amended and Restated Equity Incentive Plan (the “Plan”). The Plan was approved by our Compensation Committee on April 11, 2022, and by the Board on April 26, 2022. The Plan will become effective upon stockholder approval. The Plan amends and restates our 2012 Equity Incentive Plan (the “2012 Plan”), which would otherwise terminate on September 13, 2022, pursuant to its terms, ten years after its adoption in 2012.

We are seeking stockholder approval for this new Plan because the 2012 Plan is terminating this year. Like the 2012 Plan, the new Plan will have a ~~vote “for”~~
ten-year term, and will terminate on May 25, 2032, ten years after its approval at the ~~election~~Annual Meeting. We are not seeking additional shares for issuance under the Plan at this time; the pool of ~~each~~available shares under the Plan will consist of those shares which remain unallocated under the 2012 Plan, plus any shares subject to previously-issued awards which are forfeited (as described below).

The 2012 Plan was structured with an “evergreen” provision that replenished the number of shares issuable under it on an annual basis. Accordingly, we have not sought stockholder approval of our equity incentive plan since our 2012 initial public offering. As of April 1, 2022, there were approximately 3,862,008 shares (the “Remaining Shares”) remaining available for issuance and not subject to outstanding awards under the 2012 Plan. As amended and restated, the Plan does not include an evergreen share replenishment provision. Accordingly, the Plan will provide that the number of shares issuable shall be the sum of (i) the Remaining Shares, minus (ii) any shares represented by awards granted under the 2012 Plan between April 1, 2022, and May 25, 2022 (the Annual Meeting date and the Plan’s scheduled effective date), plus (iii) any shares underlying existing awards under the 2012 Plan that are later forfeited, which will be added back to the Plan pool. As of April 1, 2022, the current number of shares underlying outstanding awards was 4,220,014.

Based on our current run rate of equity award grants, we expect to return for stockholder approval of an increase to the pool of shares available for issuance at our 2023 Annual Meeting. Thereafter, we expect that we will periodically return for stockholder approval to increase the pool of shares available for issuance under the Plan.

This year, we are seeking approval of the ~~nominees set forth above.~~terms and duration of the Plan, without an accompanying increase in shares available for issuance. We believe that this bifurcated approach is prudent at this time. The future equity award needs of the Company are subject to various factors, including the success of our product development programs.

Approval of the new Plan is important for the Company, so that we can continue to hire, motivate, and retain staff in a competitive market. If the new Plan is not approved, the Company will have limited alternatives for long-term incentive compensation and will likely have to divert cash which could otherwise be used for important business initiatives towards employee retention and incentives.

Burn Rate & Overhang

Historical Burn Rate. Our historical burn rate is equal to the number of shares of Common Stock subject to equity awards granted during a period, in proportion to our weighted average outstanding shares of Common Stock. Our burn rate in 2021 was 7.25%, and our average annual burn rate for 2019, 2020, and 2021 was 4.88%.

Overhang. Our overhang is the number of outstanding shares of Common Stock that are subject to outstanding awards (i.e., unvested restricted stock awards) plus the number of shares of Common Stock available for future grants of equity awards in proportion to our number of shares of Common Stock outstanding at year end excluding unvested restricted shares. As of December 31, 2021, our overhang was 22.92%.

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~~Proposal 2:~~

~~Approval~~Plan Features

The Plan does not contain an “evergreen” share replenishment clause, meaning that our stockholders will have a say in the number of ~~a One-Time Stock Option~~shares available for equity compensation moving forward and will be able to assess the appropriate levels of potential dilution from such compensation.

The Plan prohibits the “repricing” of stock options, in line with our statement last year in our Offer to Exchange ~~Program~~
~~for Non-Executive Employees~~

~~Introduction~~

~~We have decided to seek stockholder approval of a one-time~~(filed with our Schedule TO in connection with the underwater stock option exchange ~~program~~approved by stockholders at our 2021 Annual Meeting), that the Offer to Exchange was a one-time offer.

The Plan (unchanged from the 2012 Plan) also forbids shares withheld from awards as part of cashless net settlement, either accounting for ~~current non-executive~~taxes or for payment of the exercise price of stock options, from being recycled into the Plan pool.

The Plan does not require automatic “single trigger” vesting upon a change in control transaction.

Summary of Material Terms of the Plan

This proposal describes briefly the material features of the Plan, particularly material differences from the 2012 Plan. This description is qualified by reference to the full text of the Plan, which provides additional detail and controls in the event of any inconsistency. The Plan is being filed as an appendix to this proxy statement. The provisions of the Plan are substantially similar to the provisions of the 2012 Plan.

Purpose

The Plan is intended to encourage ownership of shares of Common Stock by employees, directors, and certain consultants of the Company that would allow these non-executive employees to exchange certain significantly “out-of-the-money” stock options (meaning outstanding stock options that have an exercise price that is greater than the current market price for our stock) (also known as “underwater” stock options) for new stock options that will be exercisable for fewer shares of our common stock and ~~will have an exercise price equal to the fair market value of our common stock on the new grant date, as well as having new vesting requirements and a new expiration date.~~

~~Stockholder-Friendly Design~~

In discussing strategies to address our out-of-the-money stock options, we were particularly focused on creating a strategy that is compatible with the interests of our stockholders. We believe that the option exchange program that is being proposed meets that objective by providing a more cost-effective and stockholder-friendly retention and incentive tool than simply issuing additional equity awards or paying cash compensationits affiliates in order to ~~effectively~~attract and retain ~~and motivate our non-executive employees. We believe that~~such people, to induce them to work for the ~~benefits~~benefit of the ~~proposed exchange program, including reducing~~Company or of an affiliate and to provide additional incentive for them to promote the success of the Company or of an affiliate.

Plan Participants

The Plan allows as participants our ~~overhang (meaning potential shares committed but unissued)~~directors, employees, and consultants (including, in each case, those working for our affiliates). We currently have eleven directors on our Board. As of December 31, 2021, we had 437 employees (including those working for affiliates). Although consultants are defined broadly under the Plan, we don’t often grant awards to consultants. As of March 31, 2022, the number of consultants with outstanding awards under the 2012 Plan was fewer than ten people (excluding former employees who became consultants and kept their existing awards), and ~~approximate value-neutrality (i.e., keeping~~we currently expect that number to hold steady when also including the ~~aggregate value~~new Plan. Recipients of awards under the Plan will be selected from among eligible participants by the Plan administrator (discussed below).

Administrator; Awards Available Under the Plan

The administrator of the ~~old versus replacement~~Plan, responsible for granting awards, ~~approximately consistent), contribute~~will continue to ~~an alignment~~be our Compensation Committee, acting on behalf of the ~~program with~~Board (which may also act as administrator under the ~~interests~~terms of the Plan). The Compensation Committee may further delegate plan administration, for example to our ~~stockholders. In particular (and as discussed in more detail below):~~Chief Executive Officer, except that only the Board or the Compensation Committee may grant awards to directors or officers of the Company subject to the provisions of Section 16 of the Exchange Act. The Plan, like the 2012 Plan, will provide for grants of:

•

~~We believe that the option exchange program would result in a net reduction of the overhang from our equity compensation program (up to 12.7% of our overhang on account of~~Stock options, including incentive stock options (“ISOs”), and ~~1.0% of our fully diluted share count, depending upon the level of participation in the program).~~options that do not qualify as ISOs (“Non-Qualified Options” or “NSOs”),

•

Exchange ratios for the exchange are intended to result in a “value for value” exchange, meaning that the accounting fair value of replacement options granted will be approximately equal to the fair value of the options that are surrendered, so that from that perspective the exchange does not result in a windfall to participants.Stock grants, including unrestricted shares, restricted shares (“RSAs”), and performance restricted shares (“PSAs”), and

•

Shares from exchanged options that are in excess of the shares needed to issue replacement grants will not be returned to the plan pool, limiting the future dilution that could otherwise have resulted from the program.

~~We believe that these design features, among others, mean that the proposed exchange program is aligned with the interests of our stockholders.~~

~~Background and Reasons for the Option Exchange Program~~

~~Since 2015, when our~~Stock-based awards, including restricted stock closed as high as $313.98 (on May 18, 2015), declines in our stock price have steadily eroded the retentive and incentive value of stock options granted. For example, on December 31, 2019, our stock closed at $123.92. The decline dramatically accelerated following the issuance of the CRL from the FDA in June 2020, after which our stock price declined to levels last seen in 2012.

~~During the course of 2020, the Compensation Committee began considering, with input from Radford, which is part of the Rewards Solution practice at Aon plc~~unit awards (“~~Radford”~~RSUs”), and serves as the Compensation Committee’s independent compensation consultant, whether conducting an option exchange program would assist with our retention efforts. These discussions were undertaken in the context of this sustained decline in the trading price of the Company’s shares, which has resulted in a situation where, as of April 6, 2021, the Company has a total of approximately 2.7 million outstanding options, 98.0% of which were underwater at aperformance restricted stock ~~price of $23.53.~~unit awards (“PSUs”).

The Company has heard from employees that they view their existing underwater stock options as having little or no value due to the difference between the exercise prices of those options and the current trading price of our stock. With the uncertainty around the Company created by a number of factors, of

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As discussed below, both ISOs and Non-Qualified Options are stock options (contractual rights to purchase shares at a set exercise price, which may not be less than fair market value on the date of issuance of the option), distinguished from each other by their tax treatment. Payment of the exercise price for the shares as to which an option is being exercised shall be made (a) in United States dollars in cash or by check, or (b) at the discretion of the administrator, through delivery of shares held for at least six months having a fair market value equal as of the date of the exercise to the aggregate cash exercise price for the number of shares as to which the ~~stock price~~option is ~~one, we have seen a meaningful uplift in staff turnover since receipt~~being exercised, or (c) at the discretion of the ~~CRL, and we believe that~~administrator, by having the ~~exchange~~Company retain from the shares otherwise issuable upon exercise of ~~underwater stock options would help reduce~~ the ~~level~~option, a number of ~~turnover~~shares having a fair market value equal as of the date of exercise to the aggregate exercise price for the number of shares as to which the option is being exercised, or (d) at the discretion of the administrator, in ~~both~~accordance with a cashless exercise program established with a securities brokerage firm, or (e) at the ~~short and medium terms. The Board~~discretion of ~~Directors and~~ the ~~Compensation Committee believe that~~administrator, by any combination of the ~~underwater options no longer function~~foregoing or by payment of such other lawful consideration as the ~~retention~~administrator may determine.

Stock grants are grants of actual Common Stock, potentially subject to vesting or other conditions. Stock-based awards are grants of equity awards or equity-based awards that are generally contractual rights to receive shares of Common Stock in the future, typically subject to satisfaction of vesting conditions. Performance-based awards include performance-based vesting conditions typically combined with time-based vesting conditions.

All of these awards are further governed by the terms of grant notices and ~~incentive tool that they believe is necessary to retain employees and to motivate them to increase long-term stockholder value.~~

In addition to the benefits for employees, if the option exchange is approved by our stockholders, we expect that it will meaningfully reduce our equity overhang, by eliminating a sizable number of outstanding options that, under their currentaward agreements, with terms and conditions ~~are likely to remain unexercised for~~determined by the ~~foreseeable future. Under~~Plan administrator, consistent with the ~~ratios included in~~Plan. Specific grant notices and award agreements will set forth the ~~terms~~conditions of the ~~proposed exchange, these current options would be replaced by a smaller number of new options, thus meaningfully reducing the total number of outstanding options included in our overhang.~~

~~Other Alternatives Considered~~

When considering how best to continue to incentivize and reward our employees who have out-of-the-money stock options, the Compensation Committee engaged Radford to review and evaluate strategies to address this issue. These strategies included the stock option exchange program, as well as other alternatives, including the following:

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Increase cash compensation. To replace equity incentives, we considered whether we could substantially increase bonus cash compensation. However, significant increases in cash compensation would substantially increase our compensation expenses and reduce the cash available for other initiatives, which could adversely affect our business and operating results.

•

~~Grant additional equity awards. We also considered special grants of additional stock options at current market prices or another form of equity award~~applicable awards, such as ~~restricted stock units. However, these additional grants could substantially increase our overhang and the dilution to our stockholders.~~

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Exchange options for cash. We also considered implementing a program to exchange underwater options for cash payments. However, an exchange program for cash would also increase our compensation expenses and reduce our cash flow from operations, which could adversely affect our business and operating results. In addition, we do not believe that such a program would have significant long-term retention value.

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Exchange options for restricted stock units. We also considered implementing a program to exchange underwater options for restricted stock units. However, in order to keep the aggregate value of the old versus replacement awards approximately consistent, the exchange ratios for an options-for-restricted stock units exchange program would need to be substantially higher than for an options-for-options exchange program (i.e., fewer replacement awards would be granted in the exchange). Thus, we believe that employee participation in an options-for-restricted stock units exchange program would be lower than with an options-for-options exchange program, reducing the retention and incentive value of the program.

~~Reasons for Proposing the Option Exchange~~

Taking into account the advice of Radford and other relevant considerations, the Compensation Committee determined that a program under which current non-executive employees could exchange stock options with an exercise price, ~~greater than~~expiration date, and vesting conditions.

The securities underlying Plan awards are shares of our Common Stock, par value $0.001 per share. We periodically register the ~~“Threshold Exercise Price” (described below) was most attractive for a number~~shares of ~~reasons, summarized below. The Threshold Exercise Price will be~~Common Stock issuable pursuant to equity awards with the ~~greater~~SEC on Form S-8. As of March 31, 2022, the ~~52-week high trading~~closing price of our ~~shares~~Common Stock on the Nasdaq Global Select Market was $16.27.

Under the 2012 Plan, we have granted both ISOs and ~~1.5x~~Non-Qualified Options, and both stock-based awards (RSUs and PSUs) and stock grants (RSAs and PSAs). We retain the ~~then-current current~~ability to grant any of these awards under the Plan. However, in recent years, we have generally granted Non-Qualified Options rather than ISOs, and stock-based awards rather than stock ~~price, in each case as~~grants. For the immediate future, we expect this recent practice to continue. No more than the Remaining Shares may be issued under the Plan pursuant to the exercise of ISOs.

Amendments

The Plan may be amended by the Plan administrator. Any amendment approved by the administrator that the administrator determines requires stockholder approval shall be subject to obtaining such stockholder approval. Any modification or amendment of the Plan may not, without the consent of a ~~date shortly prior~~participant, adversely affect his or her rights under a previously granted award.

Other Provisions

The Plan contains customary terms and conditions, including regarding exercise of stock options, assignability and transferability of stock rights, the effect on awards of various types of termination of employment, adjustments for stock splits, and adjustments for certain corporate transactions such as mergers or acquisitions.

New Plan Benefits

The benefits or amounts under the Plan that will be received by, or allocated to, our Chief Executive Officer, our named executive officers, our executive officers as a group, our directors, and all employees who are not executive officers are in the ~~commencement date~~discretion of the ~~offer. The following considerations recommended proposing~~Plan administrator and are not determinable at this ~~approach:~~

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Reasonable, balanced incentives. We believe that the opportunity to exchange existing eligible stock options for new options with respect to fewer shares, together with a new vesting requirement and term, represents a reasonable and balanced exchange program with the potential

time.

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Certain Federal Income Tax Consequences in Respect of the Plan

The following is a summary of certain United States federal income tax consequences with respect to awards under the Plan. Participants should consult with their own tax advisors and should not rely upon this summary.

Non-Qualified Options. A participant in the Plan generally will not be taxed upon the grant of an NSO. Rather, at the time of exercise of such NSO, the participant will recognize ordinary income for federal income tax purposes in an amount equal to the excess of the fair market value of the shares purchased over the exercise price. The Company, as the recipient of the services rendered by the participant, will generally be entitled to a ~~significant positive impact on employee retention, motivation~~tax deduction at the same time and ~~performance. We believe~~in the same amount that the ~~new options issued~~participant recognizes ordinary income. If shares acquired upon exercise of an NSO are later sold or exchanged, then the difference between the sales price and the fair market value of such shares on the date that ordinary income was recognized on the exercise of the NSO will generally be taxable as long-term or short-term capital gain or loss depending upon the length of time the shares have been held.

Incentive Stock Options. A participant in the ~~exchange program~~Plan will ~~provide~~not be in receipt of taxable income upon the grant or timely exercise of an ISO. Exercise of an ISO will generally be timely if made during its term and if the participant remains an employee of us or a ~~meaningful retention period for employees~~parent, subsidiary, or related entity of ours at all times during the ~~next~~period beginning on the date of grant and ending on the date three months before the date of exercise. The tax consequences of an untimely exercise of an ISO will generally be determined in accordance with the rules applicable to NSOs. If shares acquired pursuant to the timely exercise of an ISO are later disposed of, the participant will, except as noted below, recognize long-term capital gain or loss equal to the difference between the amount realized upon such sale and the exercise price. The Company, under these circumstances, will not be entitled to any federal income tax deduction in connection with either the exercise of the ISO or the sale of such shares by the participant. If, however, shares acquired pursuant to the exercise of an ISO are disposed of by the participant prior to the expiration of two years ~~at a time when the Company expects to continue to experience retention challenges.~~

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Reduction of the number of shares subject to outstanding options. In addition to the out-of-the-money options having little or no retention value, they also contribute to our stock option overhang until they are exercised or expire unexercised. As of April 6, 2021, there were approximately 967,000 outstanding stock options with an exercise price equal to or greater than $55.59 per share, with a weighted average exercise price of $103.83, that would have been eligible to participate in the option exchange program if it had commenced on that day.

If approved by our stockholders, the option exchange program is expected to reduce our overhang of outstanding stock options by eliminating the ineffective options that are currently outstanding and issued to our non-executive employees. Under the proposed option exchange program, eligible participants will receive stock options covering fewer shares than the exchanged options. Based on the number of outstanding stock options as of April 6, 2021, and assuming that all eligible options were exchanged in the program, options to purchase approximately 967,000 shares would have been exchanged and cancelled, while new options covering approximately 626,000 shares would have been issued. This would have resulted in a net reduction in the overhang of our equity awards by approximately 341,000 shares, or approximately 12.7% of our total overhang on account of stock options (from approximately 2.7 million to approximately 2.35 million shares), and approximately 1.0% of our total fully diluted share count as of April 6, 2021. The actual reduction in our overhang that may result from the ~~option exchange program could vary significantly and is dependent upon a number of factors, including the commencement~~ date of the program, the actual level of participation in the program and the actual exchange ratios. All eligible options that are not exchanged will remain outstanding and in effect in accordance with their existing terms.

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Reduced pressure for additional grants. If we are unable to implement the option exchange program, we may find it necessary to issue additional options to our employees at current market prices, increasing our overhang. These grants would deplete the current pool of options available for future grants under our 2012 Equity Incentive Plan and would also result in increased stock compensation expense, which could negatively impact our stock price.

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Impact on accounting expense. Under applicable accounting rules, we are required to continue to recognize compensation expense related to these underwater stock options as they vest, even if they are never exercised because they remain underwater. We believe the option exchange program will allow us to recapture retentive and incentive value from the compensation expense that we have recorded and will continue to record in our financial statements with respect to our eligible options. The new options are not expected to result in significant additional compensation expense and therefore will not have a material adverse impact on our reported earnings.

•

In April 2021, the Compensation Committee authorized that we pursue a stock option exchange program for current employees (excluding former employees, members of our Board, our executive officers and consultants). Although stockholder approval is not required for this proposal under the terms of the 2012 Equity Incentive Plan, the Company does not intend to undertake the option exchange program unless stockholders approve this proposal~~. If stockholders approve this proposal, the Company intends to commence the exchange program during the third~~ISO’s grant or ~~fourth quarter of 2021. The Board or the Compensation Committee will determine the actual start date for the exchange program. If the exchange program does not commence~~ within one year from the date such shares are transferred to him or her upon exercise, referred to as a disqualifying disposition, any gain realized by the participant generally will be taxable at the time of such disqualifying disposition as follows: (i) at ordinary income rates to the extent of the ~~Annual Meeting,~~difference between the exercise price and the lesser of the fair market value of the shares on the date the ISO is exercised or the amount realized on such disqualifying disposition, and (ii) as short-term or long-term capital gain to the extent of any excess of the amount realized on such disqualifying disposition over the fair market value of the shares on the date which governs the determination of his or her ordinary income. In such case, the Company may claim a federal income tax deduction at the time of such disqualifying disposition for the amount taxable to the participant as ordinary income. The amount by which the fair market value of the stock on the exercise date of an ISO exceeds the exercise price will be an item of adjustment for purposes of the “alternative minimum tax” imposed under the Internal Revenue Code.

RSAs and PSAs. A participant in the Plan generally will not be taxed upon the grant of an RSA or PSA, but rather will recognize ordinary income in an amount equal to the fair market value of the Common Stock at the time the shares are no longer subject to a substantial risk of forfeiture. The Company, as the recipient of the services rendered by the participant, will be entitled to a deduction at the same time as, and in the same amount that, the participant recognizes ordinary income. A participant may however elect (not later than 30 days after acquiring such shares) to recognize ordinary income at the time the RSA or PSA is granted in an amount equal to the fair market value of the shares at that time, notwithstanding the fact that such shares are subject to restrictions and a substantial risk of forfeiture. If such an election is made, no additional taxable income will be recognized by such participant at the time the restrictions lapse. The Company, as the recipient of the services rendered by the participant, will be entitled to a tax deduction at the same time as and to the extent that income is recognized by such participant. If shares in respect of which such election was made are later forfeited, no tax deduction is allowable to the participant for the forfeited shares, and we ~~may consider any future exchange or similar program~~will be deemed to recognize ordinary income equal to the amount of the deduction allowed to us at the time of the election in respect of such forfeited shares.

Other Awards. With respect to RSUs and PSUs, unrestricted shares, and other awards, the Company will generally be entitled to a deduction for U.S. income tax purposes in the amount and at the time that the participant is deemed to be ~~a new one, and may seek new stockholder approval before implementing it.~~

~~When determining the eligibility~~in receipt of options for this program, the Compensation Committee (with advice from Radford) intends that options granted on or after February 15, 2020 be ineligible to participate. As the price of our stock has been depressed for over the past year, this decision was made to maximize the retentive value of our equity program, while also being conscious that these awards are intended to be long-term in nature.ordinary income.

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~~Members of the Board, executive officers of the Company, former employees, and consultants will not be eligible~~Other Disclosures

Please refer below to “Executive Compensation—Equity Compensation Plan Information” for the stock option exchange program. Together, the holdings of the Board and executive officers constitute approximately 32.4% of the outstanding options; these options will remain outstanding under their existing terms. Exchange ratios will be designed to result in a “value for value” exchange, which means that the accounting fair value of replacement options granted will be approximately equal to the fair value of the options that are surrendered. Any shares subject to surrendered options (in excess of the replacement options issued under the exchange program) ~~will not~~ become available for new grants under the 2012 Equity Incentive Plan. The 52-week high trading price of our common stock and 1.5 times the current trading price of our shares (in each case as of a date shortly prior to the commencement date of the offer) will be used to determine the minimum exercise price for options eligible to be exchanged. Using this minimum price is designed to ensure that only outstanding options that are significantly out of the money will be eligible for the exchange program.

~~Overview~~

~~An overview of the key features of the proposed option exchange program is provided below.~~

	~~Eligible Participants~~			~~All current employees except executive officers; directors, consultants, and former employees are not eligible~~
	~~Type of Exchange~~			~~Options for Options~~
	~~Eligible Options~~			Options with exercise prices above both (1) the 52-week high for Company stock and (2) 1.5 times the current trading price of our shares, in each case as of a date shortly prior to the commencement date of the offer
				~~Options are excluded from participating in the offer that are scheduled to expire before the exchange closes~~
				~~Options that were granted on or after February 15, 2020 are excluded from participating in the offer~~
	~~Elections~~			~~Employees may elect to exchange individual grants; however, if an employee elects to exchange a specific grant, all options granted on the same date must be exchanged~~
	~~Term of Replacement Grant~~			~~All replacement options will have a six and one-half year maximum term~~
	~~Vesting of Replacement Grant~~			Replacement awards will vest on the first anniversary of the replacement grant (with respect to vested options that are exchanged) and on the second anniversary of the replacement grant (with respect to unvested options that are exchanged), subject in each case to continued employment
	~~Plan to Be Issued Under~~			~~Replacement options will be issued under the 2012 Equity Incentive Plan; excess shares resulting from exchange will~~ ~~not~~ ~~be returned to the plan pool~~
	~~Illustrative Exchange Ratios~~			Exchange ratios depend on the value of the underwater options, which are grouped to simplify administration; exchange ratios are expected to range from 1.25-to-1 to 4.5 -to-1 (described in more detail below)
	~~Total Grants Eligible for Exchange, Price, and Term~~			Options to purchase approximately 967,000 shares with a weighted average exercise price of $103.83 and a weighted average remaining term of 6.78 years are expected to be eligible for the exchange program
	~~Total Replacement Grants, Price and Term~~			Assuming 100% participation, approximately 626,000 options are expected to be granted as replacement options with an exercise price based on the closing price as of the date of the exchange and a maximum term of six and one half years

~~Exchange Ratio~~

The table below illustrates for eligible options, the applicable exercise price range, the approximate number of options in each such range (along with the weighted average exercise price and remaining term for options in that category), the applicable exchange ratio and the approximate number of new options

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issuable with respect to exchanged options, assuming 100% participation in the offer, had the offer been commenced as of April 6, 2021. The exercise price ranges and exchange ratios will be determined immediately prior to the commencement of the in a manner consistent with that used to formulate the illustration below.

Per Share Exercise Price ($)
Number of
Outstanding
Options in Range

Weighted Average
Exercise Price ($)

Weighted Average
Remaining Term

Exchange
Ratio

New Options
Issuable
(assuming full
participation)

55.59 – 75.00 235,000 61.57 6.72 1.25 – 1 188,000
75.01 – 115.00 576,000 103.07 7.46 1.50 – 1 384,000
115.01 – 125.00 60,000 120.62 5.26 2.00 – 1 30,000
125+ 96,000 201.20 3.85 4.00 – 1 24,000

~~Implementing the Exchange Program~~

We have not commenced the exchange program and do not intend to do so unless our stockholders approve this proposal. If we receive stockholder approval of the program, the exchange program may commence at a time determined by the Board or the Compensation Committee, with terms substantially consistent with those described in this proposal. Even if the stockholders approve this proposal, the Board or the Compensation Committee may still later determine not to implement the exchange program.

Upon commencement of the exchange program, employees holding eligible options would receive written materials (the “offer to exchange”) explaining the precise terms and timing of the exchange program. Employees would be given at least 20 business days (or such longer period as we may elect to keep the exchange program open) to elect to exchange all or none of their eligible options, on a grant-by-grant basis, for replacement options. After the offer to exchange is closed, the eligible options surrendered for exchange would be cancelled, and the Compensation Committee would approve grants of replacement options to participating employees in accordance with the applicable exchange ratios and other terms of the program. At or before commencement of the exchange program, we will file the offer to exchange and other related documents with the SEC as part of a tender offer statement on Schedule TO. Employees, as well as stockholders and members of the public, will be able to access the offer to exchange and other documents we file with the SEC free of charge from the SEC’s web site at www.sec.gov.

~~Other Matters~~

~~Treatment of Net Shares~~

~~The net shares underlying eligible options in excess of the shares underlying the new options granted in the program will~~ ~~not~~ ~~be returned to the pool available for issuance under the 2012 Equity Incentive Plan.~~

~~Accounting Treatment~~

The incremental compensation expense associated with the option exchange program will be measured as the excess, if any, of the fair value of each new stock option granted to participants in the program, measured as of the date the new stock options are granted, over the fair value of the stock options surrendered in exchange for the new stock options, measured immediately prior to the cancellation. We do not expect the incremental compensation expense, if any, to be material. We will recognize any such incremental compensation expense ratably over the vesting period of the new stock options.

~~United States Federal Income Tax Consequences~~

~~We believe the exchange of eligible options for new options~~disclosures furnished pursuant to ~~the option exchange program should be treated as a non-taxable exchange, and no income should be recognized for United States federal income tax purposes by us or our employees upon the grant~~Item 201(d) of the new options. However, the U.S. Internal Revenue Service (the “IRS”) is not precluded from adopting a contrary position, and the laws and regulations themselves are subject to change. A more detailed summary of the applicable tax considerations to eligible participants will be provided to them in connection with the offer when it is commenced.

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~~Potential Modifications to Terms to Comply with Governmental Requirements~~

The terms of the option exchange program will be described in a tender offer statement that we will file with the SEC. Although we do not anticipate that the SEC will require us to modify the terms significantly, it is possible we will need to alter the terms of the program to comply with comments from the SEC. Changes in the terms of the program may also be required for tax purposes or to comply with applicable law outside of the United States for non-U.S. participants.Regulation S-K.

Vote Required for Approval

~~Approval~~The approval of the ~~One-Time Stock Option Exchange Program~~new Plan requires the affirmative vote of a majority of the shares cast affirmatively or negatively in person or by proxy at the Annual Meeting.

~~The Board recommends a vote “for”~~THE BOARD RECOMMENDS A VOTE “FOR”
~~the proposal to allow a one-time stock option exchange program~~
~~for employees other than executive officers.~~THE APPROVAL OF OUR AMENDED AND RESTATED EQUITY INCENTIVE PLAN.

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PROPOSAL 3:

~~Proposal 3:~~

~~Non-Binding, Advisory Vote on the Compensation of~~NON-BINDING, ADVISORY VOTE ON THE COMPENSATION OF
~~the Company’s Named Executive Officers~~THE COMPANY’S NAMED EXECUTIVE OFFICERS

We have adopted a performance-based compensation philosophy that is intended to attract, retain, reward, and incentivize our executive officers to achieve our near-term corporate goals, as well as our long-term strategic objectives. In particular, our philosophy is designed to achieve the following objectives:

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reward the achievement of measurable corporate objectives and align executive officers’ incentives with increasing stockholder value;

•

attract, retain, and motivate ~~highly-talented~~highly talented individuals with the skills and demonstrated abilities necessary to deliver superior execution of our short- and long-term strategic plans and drive our continued success;

•

provide executive compensation that is competitive with that paid by our peers in the competitive and dynamic biopharmaceutical industry;

•

appropriately balance cash compensation designed to encourage the achievement of critical annual goals with equity incentives designed to inspire the achievement of long-term objectives and align the interests of our executive officers more closely with those of our stockholders; and

•

align the compensation principles for our executive officers with those for all employees to help create a company-wide performance culture.

~~Please note that if stockholders approve, and we implement, the stock option exchange described in Proposal 2, directors and executive officers would not be included in the program.~~

We urge our stockholders to read the “Compensation Discussion and Analysis” section of this proxy statement, which describes our executive compensation philosophy and how we implemented it through our ~~2020~~2021 compensation program for our principal executive officer, principal financial officer, and other “named executive officers” identified therein.

Pursuant to Section 14A of the Exchange Act, our stockholders are provided an opportunity to vote to approve, on a non-binding, advisory basis, the compensation of our named executive officers as disclosed in this proxy statement. This non-binding, advisory vote is commonly referred to as a “say-on-pay” vote.

At our ~~2015~~2021 Annual Meeting, ~~of Stockholders,~~ we asked our stockholders to indicate if we should hold a “say-on-pay” vote every one, two, or three years. Our stockholders indicated a strong preference for voting annually, and, taking this into consideration, our Board determined to hold such a vote annually.

Accordingly, we are submitting the following resolution for stockholder approval at the Annual Meeting:

“RESOLVED, that the stockholders of Intercept Pharmaceuticals, Inc. approve, on a non-binding, advisory basis, the compensation of the Company’s named executive officers as disclosed in the proxy statement for the ~~2021~~2022 Annual Meeting of Stockholders, including the Compensation Discussion and Analysis and the compensation tables and other narrative compensation disclosures.”

This vote is not intended to address any specific item of compensation, but rather the overall compensation of the Company’s named executive officers and the philosophy, programs, and practices described in this proxy statement. As this is a non-binding, advisory vote, the result will not be binding on the Company, our Board, or our Compensation Committee, although our Compensation Committee will consider the outcome of the vote when evaluating the Company’s compensation philosophy, programs, and practices.

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Vote Required for Approval

The approval, on a non-binding, advisory basis, of the compensation of the Company’s named executive officers ~~(Proposal 3)~~ requires the affirmative vote of a majority of the shares cast affirmatively or negatively in person or by proxy at the Annual Meeting.

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~~The Board recommends a vote “for”~~THE BOARD RECOMMENDS A VOTE “FOR”
~~the approval, on a non-binding, advisory basis,~~THE APPROVAL, ON A NON-BINDING, ADVISORY BASIS,
~~of the compensation of the Company’s named executive officers.~~OF THE COMPENSATION OF THE COMPANY’S NAMED EXECUTIVE OFFICERS.

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PROPOSAL 4:

~~Proposal 4:~~

~~Non-Binding, Advisory Vote on the Frequency~~RATIFICATION OF APPOINTMENT OF INDEPENDENT
~~of the Say-on-Pay Vote~~

~~We have been providing stockholders with the opportunity to vote (on a non-binding, advisory basis) on the compensation of our named executive officers (a “say-on-pay” vote) on an annual basis.~~

Pursuant to SEC rule, we are required to hold this “say-on-pay” vote at least once every three years. We choose to hold it annually, in response to the preference of our stockholders expressed in 2015, and as a matter of good corporate governance practices and responsiveness to stockholders.

In addition, every six years, we are required to hold a “say-on-frequency” vote, on a non-binding, advisory basis, to again ask our stockholders whether the “say-on-pay” vote should occur every one, two, or three years.

On this proposal, you can vote any of those three options, or abstain. We recommend continuing to hold the “say-on-pay” vote annually, so that we can continue to be responsive to stockholder views about our compensation program.

~~Accordingly, on this Proposal 4, we are submitting the following resolution for stockholder advisory vote:~~

~~“RESOLVED, that the stockholder advisory vote on compensation of the Company’s named executive officers should occur every ONE/TWO/THREE year(s).”~~

~~Although this vote is not binding, we will take it into account in determining the frequency of future stockholder votes.~~

~~Vote Required for Approval~~

~~The frequency (one, two, or three years) that receives the most votes will be considered approved.~~

~~The Board recommends a vote for~~
~~a stockholder advisory vote on executive compensation~~
~~every “one year”.~~

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~~Proposal 5:~~

~~Ratification of Appointment of~~
~~Independent Registered Public Accounting Firm~~REGISTERED PUBLIC ACCOUNTING FIRM

The Audit Committee is responsible for the appointment, retention, compensation, evaluation, and oversight of the Company’s independent registered public accounting firm. The Audit Committee has appointed KPMG LLP as the Company’s independent registered public accounting firm for the year ending December 31, ~~2021.~~2022.

KPMG LLP has audited the Company’s financial statements since 2008. Representatives of KPMG LLP will be present virtually at the Annual Meeting, with the opportunity to make a statement should they choose to do so, and are expected to be available to respond to questions submitted electronically, as appropriate.

While stockholder ratification is not required by the Company’s Restated Bylaws or otherwise, the Board is submitting the appointment of KPMG LLP to the stockholders for ratification as a matter of good corporate governance practices. If the Company’s stockholders fail to ratify the appointment, the Audit Committee may, but is not required to, reconsider whether to retain KPMG LLP. Even if the appointment is ratified, the Audit Committee, in its discretion, may direct the appointment of a different independent registered public accounting firm at any time during the year if it determines that such a change would be in the best interest of the Company and its stockholders.

Vote Required for Approval

Ratification of the appointment of KPMG LLP as the independent registered public accounting firm of the Company for the year ending December 31, ~~2021 (Proposal 5)~~2022, requires the affirmative vote of a majority of the shares cast affirmatively or negatively in person or by proxy at the Annual Meeting.

~~The Board recommends a vote “for”~~THE BOARD RECOMMENDS A VOTE “FOR”
~~the ratification of the appointment of~~THE RATIFICATION OF THE APPOINTMENT OF KPMG LLP
~~as the Company’s independent registered public accounting firm.~~AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM.

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~~Board of Directors and Governance~~BOARD OF DIRECTORS AND GOVERNANCE

Composition of the Board

We strive to maintain Board composition in a way that includes a significant voice for a wide cross-section of the population, since the patients who use our approved product, our employees, and our other stakeholders benefit when our Board has a broader and more representative composition.

Role and Meetings of the Board

The Board meets regularly to review significant developments affecting the Company and to act on matters requiring the approval of the Board. The Board held ~~17 board~~7 meetings during the year ended December 31, ~~2020.~~2021. During ~~the~~that year, ~~ended December 31, 2020,~~ each of our incumbent directors attended at least 75%, in the aggregate, of (i) the meetings of the Board held during the period that such director served, and (ii) the meetings held by the committees of the Board on which such director served during the period that such director served.

Corporate Governance

We maintain a corporate governance page on our website that includes key information about our Global Code of Business Conduct, Corporate Governance Guidelines, and charters for each of our Board’s Audit Committee, Compensation Committee, Nominating and Governance Committee, and Research and Development Committee. The corporate governance page can be found on our website at www.interceptpharma.com in the Investors & Media section under “Corporate Governance”.

Board Leadership Structure

Mr. Fundarò has served as our Chairman since October 2015. Mr. Durso has served as our President and Chief Executive Officer, and as a director, since January 2021. In February 2018, we appointed Mr. Santini to serve as the Board’s Lead Independent Director.

We believe that separating the roles of Chairman and Chief Executive Officer recognizes the time, effort, and energy that our Chief Executive Officer is required to devote to his position, and allows him to focus on our day-to-day business, while allowing our Chairman to lead the Board in its fundamental role of providing advice to, and independent oversight of, management. Such separation is also helpful in dealing with leadership transitions, such as ~~the retirement of Dr. Pruzanski as our~~occurred when Mr. Durso became President and Chief Executive Officer, ~~effective January 1, 2021, and the accompanying promotion of Mr. Durso from Chief Operating Officer to President and Chief Executive Officer. Throughout that~~during which transition Mr. Fundarò ~~remained in his position~~continued as Chairman.

The Board also recognizes the commitment required to serve as our Chairman, particularly as the Board’s oversight responsibilities continue to grow. As a result, we believe that the appointment of Mr. Santini as our Lead Independent Director contributes to the overall effectiveness of the Board. We also believe that Mr. Santini’s appointment enhances the governance structure of the Board by reinforcing the independence of the Board in its oversight of the business and affairs of the Company. However, no single leadership model is right for all companies and at all times, and the Board may review its leadership structure in the future.

The Board has delegated certain responsibilities to committees of the Board. The Board has created four standing committees: an Audit Committee, a Compensation Committee, a Nominating and Governance Committee, and a Research and Development Committee. In addition, special ad hoc Board committees may be created from time to time to oversee special projects, financings, and other matters.

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~~Each~~The chairperson of each standing committee ~~is chaired by an independent director who~~ reports to the full Board on the activities and findings of his or her respective committee. The Board believes that this delegation of responsibilities facilitates efficient decision-making and communication among the directors and management.

Board Oversight of Risk

The Board has responsibility for the oversight of risk management, while the Company’s management has the day-to-day responsibility for the identification and control of risk at the Company. The Board,

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either as a whole or through its committees, regularly discusses with management the Company’s major risk exposures, their potential impact on the Company, and the appropriate steps that should be taken in order to monitor and control such exposures. The committees assist the Board in fulfilling its risk oversight responsibilities within their respective areas of responsibility. For example, pursuant to its written charter, the Audit Committee oversees the Company’s processes and procedures with respect to financial and enterprise risk, including overseeing the Company’s enterprise risk management program. The Compensation Committee assists the Board in fulfilling its oversight responsibilities with respect to the management of risks arising from the Company’s compensation policies and practices. The Nominating and Governance Committee focuses on the management of risks associated with the composition, organization, and governance of the Board and its committees, as well as the corporate governance structure of the Company. The Research and Development Committee reviews risks associated with the Company’s research and development programs. Each committee of the Board meets and reports its findings to the Board on a regular basis.

Independence

The Board currently consists of ~~twelve~~eleven directors. The Board uses the standards of independence established by the SEC and Nasdaq in determining whether its members are independent. The Board has affirmatively determined that each of the Company’s current directors, other than Mr. Durso and Dr. Pruzanski, is independent under the director independence criteria established by Nasdaq.

Mr. Durso is not an independent director by virtue of his employment with the Company.

Dr. Pruzanski also is not an independent director, by virtue of his previous employment and consulting agreements with the ~~Company, and his current consulting arrangement.~~Company.

The Board has determined that each member of the Audit Committee, Compensation Committee, and Nominating and Governance Committee meets any specific “independent director”, “outside director”, or similar criteria established by Nasdaq, the SEC, or the IRS required for service on such committees.

Executive Sessions and Meetings of Independent Directors

The Board generally holds executive sessions of the independent directors following each regularly scheduled meeting of the Board. Executive sessions generally do not include any employee directors, or other members of management of the Company.

Board Attendance at Annual Meetings of Stockholders

In accordance with our Corporate Governance Guidelines, members of the Board are strongly encouraged to attend the Company’s Annual Meetings of Stockholders. ~~Eight~~Nine of the ~~ten~~eleven directors comprising the Board at the time were in attendance at the Company’s ~~2020~~2021 Annual Meeting of Stockholders held on May ~~28, 2020.~~27, 2021.

Communication with the Board

The Board has adopted a process by which stockholders may communicate with the Board. Stockholders who wish to communicate with the Board may do so by sending written communications to the following address:

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Intercept Pharmaceuticals, Inc.
c/o Corporate Secretary
~~10 Hudson Yards, 37~~th ~~Floor~~305 Madison Avenue
~~New York, NY 10001~~Morristown, NJ 07960

Any such communication must state the number of shares owned by the stockholder making the communication. In any such communication, an interested person may also designate a particular director, or a committee of the Board, such as the Audit Committee, to which such communication should be directed. Our legal department will forward all correspondence to the Board or to the particularly

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designated audience, except for spam, junk mail, mass mailings, job inquiries, surveys, business solicitations or advertisements, or patently offensive or otherwise inappropriate or frivolous material. Our legal department may forward certain correspondence, such as product-related inquiries, elsewhere within the Company for review and possible response.

Global Code of Business Conduct

We have adopted a Global Code of Business Conduct as our “code of ethics”, as defined by regulations promulgated under the Securities Act and the Exchange Act, which applies to our directors, officers, and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. Our Global Code of Business Conduct is available on our website at www.interceptpharma.com in the Investors & Media section under “Corporate Governance”. We intend to satisfy the disclosure requirement under Item 5.05 of Form 8-K regarding any future amendment to, or waiver from, a provision of our Global Code of Business Conduct that applies to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, by posting such information on our website at www.interceptpharma.com in the Investors & Media section under “Corporate Governance”.

~~Our Practices Regarding:~~

Environmental, Social, and Corporate Governance (“ESG”),
~~Diversity, Equity, and Inclusion (“DEI”), and~~
~~Human Capital and Corporate Culture~~ Practices

It is a priority of our Board and of our Company to seek to further improve the Company through sound and sustainable business practices that benefit Company stockholders, Company stakeholders generally, and society at large. Key initiatives are described below.

Corporate Governance ~~and Diversity~~

~~Corporate Governance~~ Guidelines ~~and Board Diversity~~

As part of the Board’s commitment to building long-term stockholder value with an emphasis on corporate governance, the Board has adopted a set of Corporate Governance Guidelines to assist it in exercising its responsibilities. ~~Our Corporate Governance Guidelines~~The guidelines cover, among other topics, Board composition, structure, and functioning; Board membership criteria; the submission of Board nominee recommendations by stockholders; Board self-evaluations; Board access to management and advisors; leadership development; and succession planning. ~~Our Corporate Governance Guidelines~~The guidelines are available on our website at www.interceptpharma.com in the Investors & Media section under “Corporate Governance”.

~~These guidelines~~Board Diversity

Our Corporate Governance Guidelines specify that the Nominating and Governance Committee shall consider the diversity of the Board and its committees when identifying and considering board nominees, ~~for director~~ and ~~directors for service on~~ Board ~~committees~~committee assignments, and shall strive to achieve an appropriate balance of diverse backgrounds, perspectives, experiences, ages, genders, and ethnicities on the Board and its committees. In addition, to reflect its commitment to diversity, in February 2021 our Board approved amendments to ~~our Corporate Governance Guidelines~~the guidelines to require that, in connection with the use of a third-party search firm to identify potential director candidates, the Nominating and Governance Committee will instruct the firm to include on its initial list of candidates qualified individuals who reflect diverse backgrounds, including diversity of gender and race or ethnicity.

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We ~~are striving~~continue to strive to incrementally diversify our Board so that we can further benefit from a variety of a backgrounds and perspectives. In April 2021, Ms. Dagmar Rosa-Bjorkeson joined our Board. She has extensive experience in pharmaceutical strategy and operations, and her appointment further increases the gender diversity of the Board. Ms. Rosa-Bjorkeson, who is Hispanic, also enhances the Board’s ethnic diversity.

The composition of the Board reflects diversity of gender, race, and ethnicity. Specifically, the Board has two women, Ms. Rosa-Bjorkeson and Ms. Nancy Miller-Rich, and antwo ethnically diverse ~~director,~~directors, Ms. Rosa-Bjorkeson (Hispanic) and Dr. Akkaraju (Asian). The Board also has a diverse range of international perspectives, with five directors having been raised or educated outside of the United States or having lived or worked overseas for extended periods of time.

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We believe that the three directors mentioned above are “diverse” under Nasdaq rules, and that we satisfy the diversity requirements under the Nasdaq rules for companies trading on the Nasdaq Global Select Market (at least one woman and at least one minority). Our board diversity matrix for the current year is below. In future years, we expect to also disclose the immediately prior year’s matrix.

Board Diversity Matrix (As of April 1, 2022)
Total Number of Directors	11
	Female	Male	Non-Binary	Did Not Disclose Gender
Part I: Gender Identity
Directors	2	8	—	1
Part II: Demographic Background
African American or Black	—	—	—	—
Alaskan Native or Native American	—	—	—	—
Asian	—	1	—	—
Hispanic or Latinx	1	—	—	—
Native Hawaiian or Pacific Islander	—	—	—	—
White	1	6	—	—
Two or More Races or Ethnicities	—	—	—	—
LGBTQ+	—
Did Not Disclose Demographic Background	2

Executive Officer Diversity

In addition to our Board, we believe that diversity is important among our officers and executive officers, ~~provides~~providing valuable variations in backgrounds, experiences, and ~~perspectives for our Company.~~perspectives. Currently, three of our nine executive officers ~~(33%)~~ are female (Dr. ~~Gail~~Berrey, Dr. Cawkwell, ~~Ms. Lisa DeFrancesco,~~ and Ms. ~~Linda~~ Richardson)~~, as is Ms. Mary Grendell,~~.

ESG Policies

We have published on our ~~Corporate Secretary.~~website (see www.interceptpharma.com in the Investors & Media section under “Corporate Governance”) a Human Rights Policy, a Labor Policy, and an Environmental Policy. The Human Rights Policy relates to our commitment to supporting fundamental human rights, and includes standards of conduct including relating to diversity and inclusion, equal opportunity, and non-discrimination. The Labor Policy relates to labor standards of conduct including working conditions, harassment, and workplace safety. The Environmental Policy relates to environmentalism and sustainability, and includes topics including energy efficiency, water management, and waste management.

~~DEI~~Diversity, Equity, and Inclusion (“DEI”) Initiatives

With respect to our employee population, we believe that diversity is extremely important, and we are encouraging our hiring managers and other employees to keep a broad perspective in making hiring decisions, thinking about how candidates can contribute to the organization, and not hiring people similar to themselves based on unconscious bias. ~~Starting in 2020, we~~We increased our emphasis on DEI, ~~and notwithstanding the ongoing COVID-19 global pandemic, believe that we already are progressing well~~starting in ~~our efforts.~~2020. Our directors are interested in our progress with DEI, and the Board and senior management will continue to monitor diversity issues as they affect both Board and workforce composition. To further the goal of recruiting and supporting a diverse and inclusive workforce, we have initiated the following projects:

Inclusive recruitment and DEI training. In order to be inclusive in the recruiting process, and to help obtain diverse and inclusive slates of job candidates, we have recalibrated language in job descriptions, implemented the designation of pronouns in our applicant tracking systems, and updated our review system, and we also discuss our DEI ~~issues~~programming and efforts as part of the interview process. Our talent acquisition team does not allow for a lack of inclusion in hiring pools. In June 2020, 133 of our leaders and staff completed conscious inclusion training through the Korn Ferry Advisory Program.

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Employee resource groups (“ERGs”). Intercept now has multiple ERGs for interested employees, including the Women’s Initiative Now ERG, the Intercept InterPride Alliance (for LGBTQ+ individuals), and ~~in the near future,~~Blended, a Black, ~~Indigeneous~~Indigenous and people of color ERG. ERGs support us and our employees in developing a diverse and inclusive workplace, and help us to gain insight regarding potential enhancements to our workplace. Intercept’s ERGs have the mission of providing a safe space for those whom each ERG represents. ERGs work to provide advocacy, empathy, allyship, and education through discussions or other programming. Our ERGs then become a space for communicating and sharing insights, with the goal of shaping, improving, and enhancing our workplace and corporate ~~culture.~~

~~DEI advisory council.~~ ~~Another way~~culture and how we innovate and think about our work that ~~we intend to embed DEI principles further into~~benefits our practices in 2021 is through organization of an internal DEI advisory council. The functions of the council will be to identify, prioritize, and drive execution on actions to support both internal employees and external stakeholders; to recommend workplace enhancements to Intercept; and to establish opportunities to broaden the conversation about DEI in our field of treatment of progressive non-viral liver diseases.patients.

Building relationships with corporate affiliations and networks. In addition to our ERGs, we also work with outside affiliate groups and community leaders to educate and support our workforce regarding diversity issues. For example, our relationships with Out & Equal, and with the Healthcare Business Association, support us in growing our ERGs and gaining specific knowledge about workplace advocacy for LGBTQ+ and female professionals. Out & Equal also partners with us on best practices for our overall DEI program.

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Human Capital and Corporate Culture

We consider the intellectual capital of our employees to be an essential driver of our business and key to our future prospects. Accordingly, we monitor our compensation programs closely and provide what we consider to be a ~~very~~ competitive mix of compensation and insurance benefits for all our employees, as well as participation in our equity programs.

Furthermore, we seek to benefit, improve, and educate our workforce and our community in a variety of ways.

One such way is community volunteering. In order to give back to the communities in which our employees live and work, we encourage our employees to dedicate time and effort to help community organizations, including both medically focused charitable and educational efforts, and charitable community efforts of general applicability. The Company dedicates resources to community-building initiatives as ~~well. In particular, the Company~~well, and partners with organizations in the liver community ~~such as the Global Liver Institute, the American Liver Foundation, the PBCers Organization, the PBC Foundation, the Fatty Liver Foundation, NASH kNOWledge, and others,~~ to support patients impacted by progressive non-viral liver diseases. In addition, since we are a biopharmaceutical company, our employees include trained medical professionals who are in a position to help in efforts against COVID-19. Therefore, at the start of the pandemic, we developed a volunteer leave policy to encourage qualified U.S. employees to help in that regard.

Environmental Initiatives

We believe that the following Company initiatives represent good corporate environmental practices:

~~Building energy efficiency.~~ Our headquarters are located at 10 Hudson Yards, an office building in the Hudson Yards development in New York City. 10 Hudson Yards is certified by the United States Green Building Council as LEED Platinum, a standard of “Leadership in Energy and Environmental Design” for “green” buildings that are considered highly energy-efficient. In addition, the Hudson Yards neighborhood more generally has been certified as LEED Gold.

Water, Waste, Reuse, and ~~recycling.~~Recycling. ~~While much of~~We seek to manage our ~~staff is currently working remotely due~~water use through methods like low-flow fixtures. We seek to ~~the COVID-19 pandemic,~~reduce our waste by moving signature procedures to an e-signature platform, by using recycled paper, by using reusable or compostable dishes in our ~~office supplies, we are seeking to reduce waste. Therefore, where practical we are encouraging the procurement of eco-conscious, compostable, or reusable kitchen~~kitchens, and ~~other office supplies. We also~~by installed centralized waste management bins to separate compostables and recyclables from other trash.

Manufacturing and Procurement. We contract with contract development and manufacturing organizations (“CDMOs”) as part of our manufacturing ~~process. In certain~~process and some of our ~~contracts with them, these organizations~~CDMOs commit to certain levels of compliance in regard to their environmental practices. We believe that through our supply chain management and agreements, we can help promote environmental standards and stewardship. Likewise, our procurement policy encourages sourcing of sustainable goods and services, and selection of diverse suppliers. We are developing ESG criteria for the screening, onboarding, and monitoring of suppliers.

Additional Corporate Policies

Anti-Hedging and Anti-Pledging Policy

The Company restricts its directors, officers, and employees from (i) engaging in any transactions involving options, straddles, collars, or other similar risk reduction or hedging devices, (ii) using the Company’s securities to secure a margin or other loan, (iii) effecting “short sales” of the Company’s securities, and (iv) trading in the Company’s securities on a short-term basis.

Policies and Procedures Dealing with the Review and Approval of Related Person Transactions

Pursuant to its written charter, the Audit Committee is responsible for reviewing and approving, prior to the Company’s entry into such transactions, all transactions in which the Company is or will be a

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participant that would be required to be disclosed by the Company pursuant to Item 404 of Regulation S-K

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as a result of any executive officer, director, director nominee, beneficial owner of more than 5% of the Company’s securities, or immediate family member of any of the foregoing persons, or any other person whom the Board determines may be considered to be a related person under Item 404 of Regulation S-K, having or being expected to have a direct or indirect material interest therein. For the above purposes, “immediate family member” means any child, stepchild, parent, step-parent, spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law, and any person (other than a tenant or employee) sharing the household with the executive officer, director, director nominee, or greater than 5% beneficial owner.

In reviewing and approving such transactions, the Audit Committee shall obtain, or shall direct management to obtain on its behalf, all information that the Audit Committee believes to be relevant and important to a review of the transaction prior to its approval. Following receipt of the necessary information, a discussion shall be held of the relevant factors if deemed to be necessary by the Audit Committee prior to approval. If a discussion is not deemed to be necessary, approval may be given by written consent of the ~~committee.~~Audit Committee.

The Audit Committee shall approve only those related person transactions that are determined to be in, or not inconsistent with, the best interests of the Company and its stockholders, taking into account all available facts and circumstances as the Audit Committee determines in good faith to be necessary in accordance with principles of Delaware law generally applicable to directors of a Delaware corporation. These facts and circumstances will typically include, but not be limited to, the commercial reasonableness of the terms, the benefit and perceived benefit, or lack thereof, to the Company, opportunity costs of alternate transactions, the materiality and character of the related person’s direct or indirect interest, and the actual or apparent conflict of interest of the related person. No member of the Audit Committee shall participate in any review, consideration, or approval of any related person transaction with respect to which such member or any of his or her immediate family members has an interest.

No related person transaction shall be entered into or continued prior to the completion of the foregoing procedures. In the event management becomes aware of a related person transaction that has not been previously approved, it shall be submitted to the Audit Committee promptly, and the Audit Committee shall review such related person transaction in accordance with the foregoing procedures, taking into account all of the relevant facts and circumstances available to the Audit Committee. Based on the conclusions reached, the Audit Committee shall evaluate all options, including, without limitation, approval, ratification, amendment, or termination of the related person transaction.

Committees of the Board

The composition of our Board and our standing committees is as follows (with “C” indicating chairperson and “M” indicating member):

Name

Board

Audit

Compensation

Nominating and
Governance

Research and
Development

Board

Audit

Compensation

Nominating and
Governance

Research and
Development

Paolo Fundarò

–

Jerome Durso

–

Srinivas Akkaraju, M.D., Ph.D.

–

Luca Benatti, Ph.D.

–

Daniel Bradbury

–

Keith Gottesdiener, M.D.

–

Nancy Miller-Rich

–

Mark Pruzanski, M.D.

–

Dagmar Rosa-Bjorkeson

–

Gino Santini

–

Glenn Sblendorio

–

Daniel Welch

–

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Audit Committee

The Board has established an Audit Committee currently consisting of ~~Messrs. Sblendorio,~~Mr. Bradbury, Mr. Santini, and ~~Santini.~~ Mr. Sblendorio ~~who~~(chairperson). Mr. Sblendorio, whom the Board has determined is an “audit committee financial expert” (as that term is defined in Item 407(d)(5) of Regulation S-K), and who also satisfies the equivalent Nasdaq

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listing rules for financial sophistication, serves as the chairperson of the Audit Committee. Each member of the Audit Committee is independent under Rule 10A-3 of the Exchange Act and the applicable rules of Nasdaq, and also satisfies the financial literacy requirement of Nasdaq.

The Audit Committee’s primary purpose is to act on behalf of the Board in fulfilling the Board’s oversight responsibilities with respect to the Company’s accounting and financial reporting practices, systems of internal control over financial reporting and audit process, as well as the quality and integrity of the Company’s financial reports, the qualifications, independence and performance of the Company’s independent registered public accounting firm, the performance of the Company’s internal audit function and the Company’s processes for monitoring compliance with legal and regulatory requirements and the Company’s Global Code of Business Conduct. The Audit Committee’s report is set forth under “Audit Committee Report”.

The Audit Committee operates under a written charter adopted by the Board, a current copy of which is available on our website at www.interceptpharma.com in the Investors & Media section under “Corporate Governance”. The Audit Committee met ~~five~~5 times during the year ended December 31, ~~2020.~~2021.

Compensation Committee

The Board has established a Compensation Committee currently consisting of ~~Messrs.~~Ms. Miller-Rich, Ms. Rosa-Bjorkeson, and Mr. Santini ~~and Welch and Ms. Miller-Rich,~~(chairperson), all of whom are independent under applicable Nasdaq rules, “non-employee directors” within the meaning of Rule 16b-3 under the Exchange Act, and “outside directors” within the meaning of Section 162(m) of the Internal Revenue Code (the “Code”) (which is only relevant to the extent deemed necessary to qualify for transition relief under Section 162(m)). Mr. Santini serves as the chairperson of the Compensation Committee.

The Compensation Committee’s primary purpose is to act on behalf of the Board in fulfilling the Board’s responsibilities to oversee the Company’s compensation programs, policies and practices, to review and determine the compensation to be paid to the Company’s executive officers, to review, discuss with management, and approve the Company’s “Compensation Discussion and Analysis” disclosures, and to review and approve the committee’s report included in the Company’s annual proxy statement in accordance with applicable rules and regulations of the SEC in effect from time to time. The Compensation Committee’s report is set forth under “Executive Compensation—Compensation Committee Report”. For a discussion of the role of management and the use of compensation consultants in determining executive compensation, see “Executive Compensation—Compensation Discussion and Analysis”.

The Compensation Committee operates under a written charter adopted by the Board, a current copy of which is available on our website at www.interceptpharma.com in the Investors & Media section under “Corporate Governance”. Under its charter, the Compensation Committee may form and delegate its authority to subcommittees of the committee when it deems it appropriate and in the best interests of the Company. The Compensation Committee met ~~seven~~10 times during the year ended December 31, ~~2020.~~2021.

Compensation Committee Interlocks and Insider Participation

In ~~2020,~~2021, individuals who served as members of the Compensation Committee were Ms. Miller-Rich, Ms. Rosa-Bjorkeson, Mr. Santini, and former director Mr. ~~Welch, and Ms. Miller-Rich. None~~Daniel Welch. Except as described immediately below, none of these individuals is or has formerly been an officer or employee of the ~~Company. Nor~~Company, nor were there any transactions since the beginning of ~~2020,~~2021, nor are there any currently proposed transactions, in which any of these individuals had or will have an interest, other than the limitations on liability and indemnification discussed below, under “Related Person Transactions—Limitation on Liability and Indemnification Matters”.

As of June 1, 2021, Mr. Welch entered into a Consulting Agreement with the Company, providing advisory support including coaching and advice to our President and Chief Executive Officer and Executive Leadership Team, and reporting to the Chairman of the Board. The agreement is scheduled to expire on

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June 1, 2022, unless extended by mutual agreement. Mr. Welch is paid an annual fee of $75,000, and also received 8,000 stock options and 4,700 restricted stock units (“RSUs”). The stock options vest on June 1, 2022, and vested options shall be exercisable until June 1, 2023 (or a later date, up to 10 years from award, if the agreement is extended). The RSUs vest on June 1, 2022. The exercise price of the stock options was $17.16, our closing stock price on the grant date of June 1, 2021. We have allocated costs of $55,628 and $80,652 for the stock options and RSUs respectively, based on their grant date fair values.

In ~~2020,~~2021, none of our executive officers:

(i)

served on the compensation committee of another entity that had one or more of its executive officers serving on the Board or the Compensation Committee of the Company, or

(ii)

served on the board of directors of another entity that had one or more of its executive officers serving on the Compensation Committee of the Company.

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Nominating and Governance Committee

The Board has established a Nominating and Governance Committee currently consisting of ~~Messrs. Welch and~~Dr. Benatti (chairperson), Mr. Bradbury, and ~~Dr. Benatti,~~Ms. Miller-Rich, all of whom are independent under applicable Nasdaq rules. ~~Mr. Welch~~Dr. Benatti serves as the chairperson of the Nominating and Governance Committee.

The Nominating and Governance Committee’s primary purpose is to:

(i)

evaluate and make recommendations to the Board with respect to the current size, composition, organization, and governance of the Board and its committees;

(ii)

identify, review, and evaluate candidates qualified to serve as directors and on committees of the Board and make recommendations concerning the leadership structure of the Board;

(iii)

recommend to the Board nominees for election to the Board at the Company’s Annual Meetings of Stockholders and appointment to the Board to fill interim vacancies, if any;

(iv)

administer the annual performance evaluation process for the Board and its committees;

(v)

oversee the executive officer succession planning process; and

(vi)

oversee and make recommendations to the Board with respect to corporate governance matters.

When the Board determines to seek a new member, whether to fill a vacancy or otherwise, the Nominating and Governance Committee may utilize third-party search firms and will consider recommendations from directors, management, and others, including the Company’s stockholders, as well as take into account the diversity provisions in our Corporate Governance Guidelines. (See “Corporate Governance and Diversity” above.) Our Corporate Governance Guidelines include a policy regarding the qualifications of directors, which sets forth threshold requirements for individuals nominated to serve as directors of the Company. In general, the Nominating and Governance Committee looks for new members possessing relevant expertise to offer advice and guidance to management, having demonstrated excellence in his or her field, having the ability to exercise sound business judgment, having the commitment to promote and enhance the long-term value of the Company for its stockholders, and possessing the highest personal and professional standards of integrity and ethical values. ~~With regard to~~

The Nominating and Governance Committee operates under a written charter adopted by the Board. A current copy of such charter, as well as our ~~Board members who are new~~Corporate Governance Guidelines, which include our policies regarding the qualifications of directors, the consideration of candidates recommended by stockholders for nomination for election to the Board, and the procedures for stockholders to follow in submitting such recommendations, are available on our website at www.interceptpharma.comin the ~~past~~Investors & Media section under “Corporate Governance”. The Nominating and Governance Committee met 2 times during the year ~~Mr. Durso was identified for nomination to the Board on account of his position as an executive officer. Ms. Rosa-Bjorkeson was recommended for service on our Board by a third-party search firm.~~ended December 31, 2021.

Overboarding

The Nominating and Governance Committee believes that all members of the Board must have sufficient time and devote sufficient attention to board duties and to otherwise fulfill the responsibilities

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required of directors. In identifying and considering nominees for director and directors for service on Board committees, the Nominating and Governance Committee considers whether such nominees and directors have sufficient time and attention to devote to board duties, including whether, among other things, such nominees and directors may be “overboarded”, which refers to the situation where a director serves on an excessive number of boards.

Our Corporate Governance Guidelines provide that in advance of accepting an invitation to serve on the board of another company, directors should advise the ~~Chief Executive Officer~~CEO and Secretary of the Company, who shall then notify the Chairperson of the Board and the Chairperson of the Nominating and Governance Committee.

Our Corporate Governance Guidelines further provide that, unless approved by the Board:

(i)

no director may serve on more than a total of five boards of directors of U.S. public companies (including service on our Board), and

(ii)

a director who serves as a ~~chief executive officer~~CEO of a U.S. public company shall not serve on the boards of directors of more than three U.S. public companies (including service on our Board).

Accordingly, prior to recommending a candidate as a nominee for director or a director for service on a Board committee, the Nominating and Governance Committee reviews the number of public company boards that the candidate or director serves on, and whether the individual is a ~~chief executive officer~~CEO of a public company, and considers whether such outside commitments may limit his or her ability to devote sufficient time and attention to the affairs of the Company.

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All nominees are in compliance with our Corporate Governance Guidelines, and their extensive experience in the pharmaceutical industry and in managerial and financial leadership roles has led to their nomination to the Board.

Mr. Bradbury is currently a director of Castle Biosciences, Inc., and is the Executive Chairman of Equillium, Inc., a biopharmaceutical company that he co-founded. He was previously Chairman and ~~Chief Executive Officer~~CEO of Equillium, Inc. In recommending Mr. Bradbury to serve on the Board, the Nominating and Governance Committee considered, among other things, that in January 2020 Mr. Bradbury transitioned from Chairman and ~~Chief Executive Officer~~CEO of Equillium, Inc., to the more limited role of Executive Chairman, which does not present a time commitment obstacle to his work on our Board. The committee also considered Mr. Bradbury to be an asset to our Board, on account of his significant public company experience in the pharmaceuticals industry.

Mr. Sblendorio is currently President and ~~Chief Executive Officer,~~CEO, and a director, of IVERIC bio, Inc., and a director of Amicus Therapeutics, Inc. In recommending Mr. Sblendorio to serve on the Board, the Nominating and Governance Committee considered his more than 30 years of industry experience, including as a ~~Chief Executive Officer,~~CEO, President, director, ~~Chief Operating Officer, Chief Financial Officer,~~COO, CFO, and ~~Senior Vice President~~SVP of Business Development at multiple pharmaceutical companies.

At our 2021 Annual Meeting, Mr. Sblendorio received 65% votes in favor of election, and 35% votes withheld. We understand that although Mr. Sblendorio complies with our overboarding policy, certain stockholders and proxy advisory firms have a strict “withhold” policy when a director is on more than four boards, or more than two boards and is a public company CEO (compared with our policy of five or three respectively). Accordingly, some stockholders voted “withhold” on Mr. Sblendorio last year as a policy matter.

The Nominating and Governance Committee and the Board have considered Mr. Sblendorio’s situation, and while they understand that some stockholders may not be able to support Mr. Sblendorio as a policy matter, they strongly recommend his re-election to the Board. In the time since he joined our Board in 2014, Mr. Sblendorio has become familiar with the Company and its business, and has been committed to his work for the Company. In particular, his Company knowledge, work ethic, and corporate finance expertise have been valuable for the Company in his work as chairperson and financial expert for our Audit Committee, to which he brings public company biopharmaceutical CEO, CFO, and COO experience.

In addition, Mr. Sblendorio’s other public company positions give him useful perspective to share with the Company. IVERIC bio, Inc., is a biopharmaceutical company focused on discovering and developing transformative therapies for retinal diseases with significant unmet medical needs. Amicus is a

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biotechnology company focused on discovering, developing, and delivering high-quality medicines for people living with rare metabolic diseases. Both of these business models have many parallels to our business of developing novel treatments for liver disease. In conclusion, Mr. Sblendorio has exactly the perspective that we should have on our Board as we navigate the development and commercialization of novel pharmaceutical products. In the time since he joined our Board in 2014, we have found Mr. Sblendorio to have developed a beneficial familiarity with the Company and its business, and to be committed to his work for the Company—both characteristics being demonstrated with his work as chairperson and financial expert for our Audit Committee.

The Nominating and Governance Committee operates under a written charter adopted by the Board. A current copy of such charter, as well as our Corporate Governance Guidelines, which include the above-referenced policies regarding the qualifications of directors, the consideration of candidates recommended by stockholders for nomination for election to the Board, and the procedures for stockholders to follow in submitting such recommendations, are available on our website at ~~www.interceptpharma.com~~ ~~in the Investors & Media section under “Corporate Governance”. The Nominating and Governance Committee met three times during the year ended December 31, 2020.~~

Candidate Review

Candidates for the Board are reviewed in the context of the foregoing standards and considerations, as well as the expected contributions of each candidate to the collective functioning of the Board, based upon the totality of his or her credentials, experience, and expertise, the composition of the Board at the time, and other relevant circumstances, including the operating requirements of the Company and the long-term interests of stockholders. With respect to the nomination of continuing directors for re-election, the individual’s past performance as a director is also considered. The Nominating and Governance Committee periodically reviews the composition of the Board, including whether the directors, both individually and collectively, can and do provide the experience, qualifications, attributes, and skills appropriate for the Company.

Our Corporate Governance Guidelines include policies with respect to the consideration of candidates recommended by stockholders for nomination for election to the Board and the procedures for stockholders to follow in submitting such recommendations. The Nominating and Governance Committee will consider bona fide candidates recommended by stockholders in accordance with such policies. Any such recommendation must be submitted in writing to the Nominating and Governance Committee, care of Intercept Pharmaceuticals, Inc., ~~10 Hudson Yards, 37th Floor, New York, NY 10001,~~305 Madison Avenue, Morristown, NJ 07960, Attention: Corporate Secretary, within the time frames set forth in such policies and contain the information and undertakings required by such policies. Nominees for director who are recommended by stockholders to the Nominating and Governance Committee will be evaluated in the same manner as any other nominee for director. Nominations by stockholders may also be made in the manner set forth under “Stockholders’ Proposals”.

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Research and Development Committee

The Board has established a Research and Development Committee currently consisting of Dr. Akkaraju, Dr. Benatti, Dr. ~~Akkaraju,~~Gottesdiener (chairperson), and Dr. ~~Gottesdiener.~~Pruzanski. Dr. ~~Benatti~~Gottesdiener serves as the chairperson of the Research and Development Committee.

The Research and Development Committee’s primary purpose is to assist the Board in its oversight of the Company’s strategic direction and investment in research and development, technology, and manufacturing, and to identify and discuss significant emerging trends and issues in science and technology, and consider their potential impact on the Company.

The Research and Development Committee operates under a written charter adopted by the Board, a copy of which is available on our website at www.interceptpharma.com in the Investors & Media section under “Corporate Governance”. The Research and Development Committee met ~~five~~18 times during the year ended December 31, ~~2020.~~2021.

Director Compensation

On an annual basis, the Compensation Committee conducts an evaluation of the design of the Company’s independent director compensation program in light of best practices and competitive market data for the Company’s compensation peer group. In ~~2020,~~2021, as in prior years, the Compensation Committee again retained the services of the Rewards Solution practice at Aon plc, specifically members of Radford, an independent compensation consultant, to provide it with additional comparative data on director compensation practices in the Company’s industry and to advise it on the Company’s independent director compensation program generally. In May ~~2020,~~2021, based on the input and analysis provided by Radford, the Compensation Committee determined that no adjustments were needed to the independent director compensation levels previously adopted by the Board in ~~June 2018,~~May 2020, which had been adopted with reference to the 50th percentile of the competitive market based on our compensation peer group. As a result, (i) all annual cash retainers were maintained at their pre-existing levels, (ii) the aggregate equity value of the

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Annual Grant (as defined below) was maintained at $264,500, and (iii) the aggregate equity value of any New Director Grant (as defined below) was maintained at $396,750. Only directors who are “independent” in accordance with applicable Nasdaq rules ~~(the “Independent Directors”)~~ receive compensation for their service as directors. Each of the Company’s current directors, other than Mr. Durso and Dr. Pruzanski, qualifies as ~~an Independent Director.~~independent.

For ~~2020,~~2021, the annual cash retainers for the ~~Independent Directors~~independent directors were as follows (payable quarterly in equal installments):

Membership	Chairperson			Other Members			Chairperson			Other Members
Board of Directors		$	80,000		$	50,000
Board of Directors.								$	80,000		$	50,000
Audit Committee		$	20,000		$	10,000		$	20,000		$	10,000
Compensation Committee		$	15,000		$	7,500		$	15,000		$	7,500
Nominating and Governance Committee		$	10,000		$	5,000		$	10,000		$	5,000
Research and Development Committee		$	10,000		$	5,000		$	10,000		$	5,000

Pursuant to the independent director compensation levels adopted by the Board, (i) each ~~Independent Director~~independent director who had served on the Board for six months or longer as of the date of the Company’s ~~2020~~2021 Annual Meeting of Stockholders was eligible to receive an annual equity grant (each, an “Annual Grant”), comprised of stock options with an equity value of $132,250 and ~~restricted stock units~~RSUs with an equity value of $132,250, and (ii) each new ~~Independent Director~~independent director first appointed or elected to the Board in ~~2020~~2021 was eligible to receive an equity grant (each, a “New Director Grant”), comprised of stock options with an equity value of $198,375 and ~~restricted stock units~~RSUs with an equity value of $198,375. ~~No new Independent Directors were appointed or elected to the Board in 2020, and accordingly no New Director Grants were made in 2020.~~

The number of (i) stock options granted in connection with each Annual Grant and New Director Grant is determined by dividing the equity value to be represented thereby by the value per-option derived from a Black-Scholes model with reference to the average of the per-share closing prices of the Company’s

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common stock on the Nasdaq Global Select Market during the 30 trading days preceding the grant date, and (ii) ~~restricted stock units~~RSUs granted in connection with each Annual Grant and New Director Grant is determined by dividing the equity value to be represented thereby by the average of the per-share closing prices of the Company’s common stock on the Nasdaq Global Select Market during the 30 trading days preceding the grant date. Because the number of stock options and ~~restricted stock units~~RSUs granted in connection with each Annual Grant and New Director Grant is determined using a 30-day average closing stock price, the grant date fair values of such stock options and ~~restricted stock units,~~RSUs, as computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“ASC 718”), differ from the amounts set forth above.

Subject to the ~~Independent Director’s~~independent director’s continued service on the Board, the stock ~~option~~options and ~~restricted stock unit awards~~RSUs granted in connection with (i) each Annual Grant vest in full on the earlier of (A) the one-year anniversary of the date of grant and (B) the day immediately preceding the date of the next Annual Meeting of Stockholders, and (ii) each New Director Grant vest in a series of three equal annual installments, with 1/3 of the shares subject to the award vesting on each anniversary of the date that the ~~Independent Director~~independent director was first elected or appointed to the Board (or, if earlier in any given year, the day immediately preceding the date of the Annual Meeting of Stockholders in such year). In addition, all unvested Annual Grants and New Director Grants shall immediately vest in connection with a change in control of the Company. The exercise price for stock options granted in connection with each Annual Grant and New Director Grant is the per-share closing price of the Company’s common stock on the Nasdaq Global Select Market on the date of grant.

The Company also reimburses reasonable out-of-pocket expenses incurred in connection with attendance at Board meetings.

The following table sets forth ~~for the fiscal year ended December 31, 2020, the~~ total director compensation ~~paid to the non-employee directors serving on the Board during 2020.~~in 2021.

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Director Compensation for ~~2020~~2021

Name	Fees Earned or Paid in Cash ($)(1)		Stock Awards ($)(2)		Option Awards ($)(2)		Total ($)		Fees Earned or Paid in Cash ($)(2)		Stock Awards ($)(3)		Option Awards ($)(3)		Total ($)
Paolo Fundarò		80,000		116,020		132,254		328,274		80,000		120,055		120,165		320,220
Srinivas Akkaraju, M.D., Ph.D.		55,000		116,020		132,254		303,274
Luca Benatti, Ph.D.		65,000		116,020		132,254		313,274
Jerome Durso(1)										—		—		—		—
Srinivas Akkaraju										55,000		120,055		120,165		295,220
Luca Benatti										65,000		120,055		120,165		305,220
Daniel Bradbury		65,000		116,020		132,254		313,274		65,000		120,055		120,165		305,220
Keith Gottesdiener, M.D.		55,000		116,020		132,254		303,274
Keith Gottesdiener										57,972		120,055		120,165		298,192
Nancy Miller-Rich		57,500		116,020		132,254		305,774		60,472		120,055		120,165		300,692
Mark Pruzanski(1)										—		—		—		—
Dagmar Rosa-Bjorkeson										41,958		180,074		180,202		402,235
Gino Santini		75,000		116,020		132,254		323,274		75,000		120,055		120,165		315,220
Glenn Sblendorio		70,000		116,020		132,254		318,274		70,000		120,055		120,165		310,220
Daniel Welch		67,500		116,020		132,254		315,774
Daniel Welch(1)										27,375		—		—		27,375

(1)

~~Represents an annual~~Director compensation is for independent directors only. Mr. Durso and Dr. Pruzanski do not qualify as independent. Mr. Welch retired from the Board in 2021. Amounts for Mr. Welch exclude amounts under his consulting agreement.

(2)

Annual cash retainer for ~~service on the~~ Board and ~~our standing committees. See “Board of Directors and Governance—Committees of the Board”.~~committee service.

~~(2)~~(3)

Amounts shown represent the aggregate grant date fair value, computed in accordance with ASC 718, in respect of stock ~~option~~options and ~~restricted stock unit awards.~~RSUs. These amounts do not reflect compensation actually received by the ~~Independent Directors.~~independent directors. Assumptions used in the calculation of these amounts are included in “Stock Compensation”, Note 13 to the Notes to Consolidated Financial Statements for the year ended December 31, ~~2020,~~2021, included in our Annual Report.

Each ~~Independent Director~~independent director received an Annual Grant in ~~2020~~2021 comprised of ~~2,966~~12,089 stock options and ~~1,595 restricted~~7,029 RSUs, or, instead for Ms. Rosa-Bjorkeson, a New Director Grant of 17,719 stock ~~units.~~options and 10,543 RSUs.

As of December 31, 2021, the aggregate number of shares subject to stock options (both vested and unvested), and unvested RSUs, held by each independent director who served on the Board during 2021 was as follows:

Name	Shares Subject to Stock Options		RSUs
Paolo Fundarò		27,616		7,029
Srinivas Akkaraju		26,615		7,029
Luca Benatti		25,912		7,029
Daniel Bradbury		25,209		7,029
Keith Gottesdiener		25,209		7,029
Nancy Miller-Rich		24,913		7,029
Dagmar Rosa-Bjorkeson		17,719		10,543
Gino Santini		27,111		7,029
Glenn Sblendorio		25,912		7,029
Daniel Welch(1)		15,022		—

(1)

Comprising vested awards only, due to retirement. Excludes consulting awards described above.

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As of December 31, 2020, the aggregate number of shares subject to stock options (including vested and unvested stock option awards), and unvested restricted stock units, held by each Independent Director serving on the Board during 2020 was as follows:

Name
Shares Subject to
Stock Options

Restricted
Stock Units

Paolo Fundarò 15,527 1,595
Srinivas Akkaraju, M.D., Ph.D. 14,526 1,595
Luca Benatti, Ph.D. 13,823 1,595
Daniel Bradbury 13,120 1,595
Keith Gottesdiener, M.D. 13,120 1,595
Nancy Miller-Rich 12,824 3,053
Gino Santini 15,022 1,595
Glenn Sblendorio 13,823 1,595
Daniel Welch 15,022 1,595

Stock Ownership Guidelines for Directors

The Company has adopted minimum stock ownership guidelines for the Board. See “Compensation Discussion and Analysis—Stock Ownership Guidelines” for more information.

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~~Security Ownership of Certain Beneficial Owners and Management~~SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table and accompanying footnotes show information as of ~~April~~the record date (April 6, ~~2021,~~2022), regarding the beneficial ownership of the Company’s shares by:

•

each person ~~who was~~ known by the Company to own beneficially more than 5% of its shares;

•

each ~~member of the Board~~director and ~~each of the Company’s~~ named executive ~~officers;~~officer; and

•

all ~~members of the Board~~directors and ~~the Company’s~~ executive officers as a group.

For purposes of the table below, we deem shares subject to options that are exercisable on or ~~exercisable~~ within sixty days, ~~of April 6, 2021,~~ and ~~restricted stock units~~RSUs vesting within sixty days, of ~~April 6, 2021,~~the record date, to be outstanding and ~~to be~~ beneficially owned by the person holding ~~the options or restricted stock units, as applicable,~~them, for ~~the purpose~~purposes of computing ~~the~~ percentage ownership of that person, but we do not treat them as outstanding for ~~the purpose~~purposes of computing ~~the~~ percentage ownership of any other person.

Except as ~~otherwise~~ noted, the persons ~~or entities~~ in this table have sole voting and investment power with respect to all of the shares beneficially owned by them. ~~On April 6, 2021, there~~As of the record date, 29,713,052 shares were ~~33,162,066 shares~~ outstanding. Unless otherwise ~~specified,~~noted, the address of each director ~~and~~or executive officer is c/o Intercept Pharmaceuticals, Inc., ~~10 Hudson Yards, 37th Floor, New York, NY 10001.~~305 Madison Avenue, Morristown, NJ 07960.

Shares Beneficially Owned(11)

Name and Address
Number of
Shares

Percentage of
Common
Stock

5% Stockholders:
Genextra S.p.A.(1)
4,000,000 12.1%
FMR LLC(2)
3,726,914 11.2%
The Vanguard Group(3)
2,828,955 8.5%
State Street Corporation(4)
2,550,750 7.7%
BlackRock, Inc.(5)
2,498,408 7.5%
First Trust Portfolios L.P.(6)
1,975,601 6.0%
Directors and Executive Officers:
Paolo Fundarò(1)
4,036,555 12.2%
Jerome Durso 73,967 *
Srinivas Akkaraju, M.D., Ph.D.(7)
678,335 2.0%
Luca Benatti, Ph.D. 24,544 *
Daniel Bradbury(8)
29,714 *
Keith Gottesdiener, M.D. 23,073 *
Nancy Miller-Rich 20,362 *
Mark Pruzanski, M.D.(9)
856,763 2.6%
Dagmar Rosa-Bjorkeson — —
Gino Santini 23,901 *
Glenn Sblendorio 22,504 *
Daniel Welch 23,082 *
Sandip Kapadia(10)
85,458 *
Richard Kim(10)
48,563 *
Lisa Bright(10)
79,919 *
Ryan Sullivan(10)
24,708 *
Christian Weyer, M.D., M.A.S. 32,077 *
All current directors and executive officers as a group (20 persons) 5,944,358 17.9%

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	Shares Beneficially Owned
Name and Address	Number of Shares		Percentage of Common Stock
5% Stockholders:
Genextra S.p.A.(1)		4,000,000		13.5%
State Street Corporation(2)		3,254,266		11.0%
FMR LLC(3)		2,639,433		8.9%
BlackRock, Inc.(4)		2,232,092		7.5%
The Vanguard Group(5)		1,971,759		6.6%
Directors and Executive Officers:(6)
Paolo Fundarò(1)		4,055,673		13.6%
Jerome Durso		123,168		*
Srinivas Akkaraju(7)		697,453		2.3%
Luca Benatti		43,662		*
Daniel Bradbury(8)		48,832		*
Keith Gottesdiener		42,191		*
Nancy Miller-Rich		39,480		*
Mark Pruzanski		897,255		3.0%
Dagmar Rosa-Bjorkeson		9,422		*
Gino Santini		43,019		*
Glenn Sblendorio		41,622		*
Andrew Saik(9)		—		—
Sandip Kapadia(10)		15,589		*
Rocco Venezia		18,235		*
Jared Freedberg		32,897		*
Michelle Berrey(9)		—		—
Gail Cawkwell		54,211		*
All current directors and executive officers as a group (19 persons)		6,244,785		21.0%

Less than 1%.

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(1)

Based on a Schedule 13G of Genextra S.p.A. (“Genextra”), Francesco Micheli (an Executive Director and Chairman of the Board of Genextra), and Paolo Fundarò (the Chief Executive Officer of Genextra), filed on August 31, 2020; a Form 4 of Genextra, filed August 17, 2020; and a Form 4 of Paolo Fundarò, filed August 17, 2020.

The Schedule 13G indicated that the filers each had shared voting and dispositive power over, and aggregate beneficial ownership of, 4,000,000 shares owned by Genextra. Mr. Micheli and Mr. Fundarò disclaim beneficial ownership with respect thereto, except to the extent of their pecuniary interests therein, if any. Genextra’s address is Via Privata Giovannino De Grassi, 11, 20123 Milan, Italy.

Mr. Fundarò owns (a) ~~19,433~~21,028 shares, (b) ~~1,595 restricted stock units~~7,029 RSUs vesting within sixty days of the record date, and (c) ~~15,527~~27,616 stock options vested or vesting within sixty days of the record date.

(2)

Based solely on ~~information contained in~~ a Schedule 13G of State Street Corporation filed ~~with the SEC~~ on February ~~8, 2021 by~~11, 2022. It reported shared voting power over 3,185,994 shares and shared dispositive power over 3,254,266 shares. Its address is State Street Financial Center, 1 Lincoln Street, Boston, MA 02111.

(3)

Based solely on a Schedule 13G of FMR LLC ~~(“FMR”). In the FMR Schedule 13G, FMR~~filed on February 9, 2022. It reported sole voting power over ~~182,322~~192,753 shares and sole dispositive power over ~~3,726,914~~2,639,433 shares. ~~FMR’s~~Its address is 245 Summer Street, Boston, MA 02210.

~~(3)~~

Based solely on information contained in a Schedule 13G filed with the SEC on February 10, 2021 by The Vanguard Group (“Vanguard”). In the Vanguard Schedule 13G, Vanguard reported shared voting power over 60,038 shares, sole dispositive power over 2,747,882 shares and shared dispositive power over 81,073 shares. Vanguard’s address is 100 Vanguard Blvd., Malvern, PA 19355.

(4)

Based solely on ~~information contained in~~ a Schedule 13G of BlackRock, Inc. filed ~~with the SEC~~ on February 11, 2021 by State Street Corporation (“State Street”). In the State Street Schedule 13G, State Street reported shared voting power over 2,443,298 shares and shared dispositive power over 2,550,750 shares. State Street’s address is State Street Financial Center, One Lincoln Street, Boston, MA 02111.

~~(5)~~

~~Based solely on information contained in a Schedule 13G filed with the SEC on January 29, 2021 by BlackRock, Inc. (“BlackRock”). In the BlackRock Schedule 13G, BlackRock~~3, 2022. It reported sole voting power over ~~2,402,201~~2,154,880 shares and sole dispositive power over ~~2,498,408~~2,232,092 shares. ~~BlackRock’s~~Its address is 55 East 52nd Street, New York, NY 10055.

~~(6)~~(5)

Based solely on ~~information contained in~~ a Schedule 13G of The Vanguard Group filed ~~with the SEC~~ on ~~January 13, 2021 by First Trust Advisors L.P. (“First Trust”). In the First Trust Schedule 13G, First Trust~~February 10, 2022. It reported shared voting power over ~~1,956,302~~47,210 shares, sole dispositive power over 1,902,636 shares, and shared dispositive power over ~~1,975,601~~69,123 shares. ~~First Trust’s~~Its address is ~~120 East Liberty Drive, Suite 400, Wheaton, IL 60187.~~100 Vanguard Blvd., Malvern, PA 19355.

(6)

Figures include the following numbers of shares subject to options that are exercisable on or within sixty days, and RSUs vesting within sixty days, of the record date, for the following directors and executive officers:

Mr. Fundarò (34,645 shares),	Mr. Durso (89,695 shares),	Dr. Akkaraju (33,644 shares),
Dr. Benatti (32,941 shares),	Mr. Bradbury (32,238 shares),	Dr. Gottesdiener (32,238 shares),
Ms. Miller-Rich (31,942 shares),	Dr. Pruzanski (278,362 shares),	Ms. Rosa-Bjorkeson (5,907 shares),
Mr. Santini (34,140 shares),	Mr. Sblendorio (32,941 shares),	Mr. Saik (zero shares),
Mr. Kapadia (zero shares),	Mr. Venezia (10,306 shares),	Mr. Freedberg (25,900 shares),
Dr. Berrey (zero shares),	Dr. Cawkwell (37,646 shares),and

all directors and executive officers as a group (786,592 shares).

(7)

Includes 640,688 shares held by Samsara BioCapital, L.P. Dr. Akkaraju is a managing member of Samsara BioCapital GP, LLC, the general partner of Samsara BioCapital, L.P. Dr. Akkaraju disclaims beneficial ownership of such shares except to the extent of his pecuniary interest therein.

(8)

Includes 7,812 shares held by BioBrit, LLC. Mr. Bradbury and his spouse are the trustees and beneficiaries of a trust that is the sole member of BioBrit, LLC.

(9)

~~Includes 100,000 shares held in a grantor retained annuity trust.~~Mr. Saik holds 62,456 RSUs, and Dr. Berrey holds 77,418 RSUs.

(10)

AsCorresponds to 40,964 shares ~~outstanding as of April 6, 2021 (excluding options and unvested restricted stock units identified~~disclosed in ~~footnote 11 below), based solely on~~a Form 4 ~~filings, for Mr. Kapadia,~~ dated January 26, ~~2021; for Mr. Kim, dated January 5, 2021; for Ms. Bright, dated July 6, 2020; and for Mr. Sullivan, dated November 16, 2020.~~

~~(11)~~

~~Includes the following shares issuable~~2021, less 25,375 RSUs forfeited upon the exercise of options that are exercisable or exercisable within sixty days of April 6, 2021 or the vesting of restricted stock units vesting within sixty days of April 6, 2021: for Mr. Fundarò, 17,122 shares; for Mr. Durso, 53,025 shares; for Dr. Akkaraju, 16,121 shares; for Dr. Benatti, 15,418 shares; for Mr. Bradbury, 14,715 shares; for Dr. Gottesdiener, 14,715 shares; for Ms. Miller-Rich, 15,877 shares; for Dr. Pruzanski, 264,669 shares; for Ms. Rosa-Bjorkeson, zero shares; for Mr. Santini, 16,617 shares; for Mr. Sblendorio, 15,418 shares; for Mr. Welch, 16,617 shares; for Mr. Kapadia, 44,494 shares; for Mr. Kim, 28,793 shares; for Ms. Bright, 57,907 shares; for Mr. Sullivan, zero shares; for Dr. Weyer, 23,430 shares; and for all directors and executive officers as a group, 554,424 shares.departure.

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~~Executive Officers~~EXECUTIVE OFFICERS

In addition to Jerome Durso, our President and Chief Executive Officer, whose biography is included above under “Election of Directors”, our executive officers as of ~~April 27, 2021,~~March 31, 2022, and their ages and positions, are listed below.

Name	Age	Position
Bryan Ball	5152	Chief Quality Officer; SVP, Operations
M. Michelle Berrey, M.D., M.P.H	55	President of Research & Development; Chief Medical Officer
Gail Cawkwell, M.D., ~~Ph.D.~~Ph.D	59	SVP, Medical Affairs, Safety & ~~Pharmacovigilance;~~ ~~Acting Chief Medical Officer~~
~~Lisa DeFrancesco~~	42	~~SVP, Corporate Affairs & Investor Relations~~Pharmacovigilance
David Ford	5354	Chief Human Resources Officer
Jared Freedberg	5253	General Counsel
Linda Richardson	5758	~~EVP,~~ Chief Commercial Officer
Andrew Saik	52	Chief Financial Officer
Rocco Venezia	4546	Chief Accounting ~~Officer;~~ ~~Acting Chief Financial~~ Officer ~~and Treasurer~~
~~Christian Weyer, M.D., M.A.S.~~	52	~~EVP, Research & Development~~

Bryan Ball has served as our Chief Quality Officer since January 2021, ~~where he~~and as SVP, Operations, since September 2021. He is responsible for quality assurance, supply chain and product development, and related systems, oversight, and reporting on a global basis. He brings 25 years of experience in building quality systems and leading technical teams in the pharmaceutical, biopharmaceutical, and medical device industries. From 2019 to 2020, Mr. Ball was Chief Quality Officer of Immunomedics, Inc., where he was responsible for all quality issues, including product development, clinical trials, manufacturing, testing, and distribution of the company’s clinical stage candidates and first commercial product. From 2015 to 2019, Mr. Ball was Senior Vice President for Quality, Environmental Health, and Safety at Mallinckrodt Pharmaceuticals. From 2012 to 2015, Mr. Ball was Vice President for Global Quality at Ikaria, Inc., which is now a part of Mallinckrodt Pharmaceuticals. From 2008 to 2012, he was Vice President for Quality Operations at Boehringer Ingelheim. Mr. Ball is a trained microbiologist, with an M.B.A. from Westminster College, an M.Sc. in cell biology from the University of North Carolina at Charlotte, and a B.Sc. in biology from Central Michigan University.

M. Michelle Berrey, M.D., M.P.H. has served as our President of Research & Development and Chief Medical Officer since June 2021. Dr. Berrey was most recently President and Chief Executive Officer at Chimerix from 2012 to 2019 where the focus was on viral infections in immunocompromised hosts. From 2007 to 2012, she served as Chief Medical Officer at Pharmasset, where she played a critical role in the development of Sovaldi® (sofosbuvir) for treatment of hepatitis C. Dr. Berrey began her career in drug development at Glaxo Wellcome and then GlaxoSmithKline. She served in multiple roles at GW/GSK, eventually serving as Vice President, Viral Diseases, Clinical Pharmacology & Discovery Medicine. During her time at GW/GSK, she was responsible for the early development of compounds for the treatment of HIV, hepatitis viruses, and hepatic fibrosis. Dr. Berrey received her M.D. from the Medical College of Georgia—Augusta University, and a Master of Public Health from Emory University. She completed her internal medicine residency at UNC Chapel Hill and a fellowship in Infectious Diseases at UW in Seattle, where her research focused on transmission of HIV, early establishment of the viral reservoir, and the potential for early antiviral therapy during acute infection.

Gail Cawkwell, M.D., Ph.D. has served as our ~~Senior Vice President,~~SVP, Medical Affairs, Safety & Pharmacovigilance since September 2018, having previously served as ~~Senior Vice President,~~SVP, Medical Affairs since February 2018. ~~She has also served as our acting Chief Medical Officer since March 2021.~~ Prior to joining the Company, Dr. Cawkwell worked for Purdue Pharma L.P., where she served as Special Advisor to the Board of Directors from September 2017 to February 2018, Chief Medical Officer from January 2015 to September 2017, and ~~Vice President,~~VP, Medical Affairs from November 2014 to January 2015. From 2000 to November 2014, Dr. Cawkwell served in a number of roles of increasing responsibility at Pfizer Inc., including most recently as ~~Vice President~~VP Medicine Team Lead for Pfizer’s tofacitinib franchise. Dr. Cawkwell also served as a Clinical Instructor of Pediatrics at Columbia Presbyterian Health Center from 2002 to 2015 and previously held several other clinical and academic posts. Dr. Cawkwell received her Ph.D. from the University of Cincinnati, her M.D. from McGill University in Montreal, Canada, and her bachelor’s degree from Duke University.

~~Lisa DeFrancesco~~ has served as our Senior Vice President, Corporate Affairs & Investor Relations, since February 2021, having previously served as Vice President, Investor Relations, since 2019. Ms. DeFrancesco has over 20 years of experience in investor relations, finance, and communications roles, predominantly in pharmaceuticals and healthcare. From 2017 to 2019, Ms. DeFrancesco worked at Melinta Therapeutics, where she served as Senior Vice President, Corporate Affairs, and was a member of the company’s Executive Leadership Team. From 2009 to 2017, she held roles of increasing responsibility at Allergan plc (formerly known as Watson Pharmaceuticals and then Actavis) as a manager, director, and ultimately Vice President of Investor Relations, and a member of the Operations Leadership Team. Before that, she held other roles in investor relations. Ms. DeFrancesco holds a bachelor’s degree in business administration from Seton Hall University.

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David Ford has served as our Chief Human Resources Officer since May 2017. He brings over 25 years of experience in a variety of human resources roles across the United States, Europe, Latin America and

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New Zealand. Prior to joining the Company, Mr. Ford spent nearly 15 years at Sanofi, where he most recently served as Vice President Human Resources for the Sanofi Genzyme global business unit from January 2016 to May 2017. Prior to that role, from November 2011 through December 2015, Mr. Ford served as Vice President Human Resources for the Sanofi North American businesses. Mr. Ford joined the pharmaceutical industry in 2002 as the HR Director—United Kingdom and Republic of Ireland for Sanofi-Synthelabo. Mr. Ford holds a master’s degree in business administration from INSEAD, Fontainebleau (France).

Jared Freedberg has served as our General Counsel since February 2021. Mr. Freedberg brings to the Company cross-disciplinary experience as both a senior lawyer and a senior business development executive in the pharmaceutical industry. From 2018 to 2020, he was General Counsel and Corporate Secretary of Immunomedics, Inc. From 2016 to 2018, he was General Counsel, Specialty Generics Operating Division, and ~~Vice President,~~VP, Legal, Business Development and Licensing, at Mallinckrodt Pharmaceuticals. From 2001 to 2016, he held positions of increasing responsibility at Covance Inc., including Vice President and Associate General Counsel, and, from 2014 to 2016, ~~Vice President~~VP for Business Development and Strategy, in which capacity he was a member of Covance’s Global Executive Leadership Team. Earlier in his career, Mr. Freedberg was in private practice. He holds a J.D. from Duke University School of Law, and a bachelor’s degree from the University of Pennsylvania.

Linda Richardson has served as our Chief Commercial Officer ~~and Executive Vice President~~ since February 2021. Ms. Richardson has more than 30 years of commercial strategy, sales, and marketing experience. From 2018 to 2021, she served as our ~~Senior Vice President~~SVP and Head of our Cholestasis Program. From 2013 to 2018, she worked at Chimerix, Inc., where she ultimately held the role of Chief Strategy and Commercial Officer, overseeing marketing, market access and reimbursement, market research and analytics, forecasting, supply chain and distribution strategies, commercial operations, product communications, and sales. From 2008 to 2013, Ms. Richardson held commercial leadership roles of increasing responsibility at Sanofi, where she was a Vice President and led the company’s global GLP-1 diabetes franchise. Prior to joining Sanofi, Ms. Richardson held roles of increasing responsibility at both Reliant Pharmaceuticals and GlaxoSmithKline, including Vice President of Marketing. Ms. Richardson has been recognized by PM360 as an “ELITE 100” award winner in the pharmaceutical industry, by the Healthcare Businesswomen’s Association as a “Rising Star,” and by PharmaVOICE as one of its “Top 100 Most Inspiring People in Life Sciences.” Ms. Richardson holds a bachelor’s degree in English from the University of Pennsylvania.

Andrew Saik has served as our Chief Financial Officer since June 2021. Mr. Saik has more than 20 years of biopharmaceutical finance experience and has served in management positions in several companies. From 2020 to 2021, Mr. Saik was CFO of Vyne Therapeutics Inc., where he was instrumental in building out the company’s finance department in the United States, renegotiated debt obligations to provide the company with enhanced financial flexibility, and helped raise over $135 million to fund operations. From 2017 to 2020, he was CFO of PDS Biotechnology Corporation (formerly Edge Therapeutics, Inc.). From 2015 to 2017, he was CFO of Vertice Pharma, LLC. From 2014 to 2015, he was CFO of Auxilium Pharmaceuticals, Inc. From 2013 to 2014, he was SVP, Finance and Treasurer at Endo Health Solutions Inc., where he helped complete the acquisition of Paladin Labs and restructured $3 billion of debt into a new corporate structure. From 2001 to 2012, he served in senior financial management roles at Valeant Pharmaceuticals International. Mr. Saik holds an M.B.A. from the University of Southern California and a Bachelor of Arts from the University of California, Los Angeles.

Rocco Venezia has served as our Chief Accounting ~~Officer and acting Chief Financial~~ Officer and Treasurer since March 2021, and brings more than 20 years of relevant finance and accounting experience to his work. Previously, he served as our Corporate Controller since 2016, where he led the expansion of the Company’s finance and accounting department during its transition from development-stage to a fully integrated commercial organization. Before he joined the Company, Mr. Venezia was the Assistant Corporate Controller at Ikaria, Inc., now part of Mallinckrodt Pharmaceuticals, from 2013 to 2016, where he led the accounting and finance team through operational and system transformations. From 2000 to 2013, Mr. Venezia held roles of increasing responsibility at KPMG LLP and Arthur Andersen, where he led multinational audits, transactions and due diligence engagements across several industries. Mr. Venezia also spent three years at KPMG LLP’s

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Department of Professional Practice where he supported engagement teams on complex technical accounting, compliance matters and audit methodology. Mr. Venezia holds a bachelor’s degree in accounting from Kean University and is a certified public accountant in New Jersey and New York.

~~Christian Weyer, M.D., M.A.S.~~ has served as our Executive Vice President, Research & Development, since November 2017. Dr. Weyer’s career in metabolic drug development spans more than 20 years, involving clinical studies and regulatory submissions at all stages of product development and across the continuum of diabetes, obesity and NAFLD/NASH. Prior to joining the Company, Dr. Weyer was President and Chief Development Officer at ProSciento, Inc., a leading clinical R&D service provider focused on diabetes, NAFLD/NASH and obesity, from December 2015 to November 2017. Dr. Weyer has served as a senior executive in several companies, including as President, Chief Executive Officer and a director of Fate Therapeutics, Inc. from October 2012 to November 2015, where he steered the company’s transition into a publicly traded cellular therapeutics company, and as Senior Vice President of R&D at

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Amylin Pharmaceuticals, Inc., where he contributed to the development and approval of several first-in-class medicines for diabetes and lipodystrophy. Before joining Amylin, Dr. Weyer worked at the National Institutes of Health, NIDDK, conducting clinical research on the pathogenesis of obesity and type 2 diabetes. Dr. Weyer received his M.D. and clinical training at the Department of Metabolic Disorders, World Health Organization Collaborating Center for Diabetes Treatment and Prevention, at the University of Düsseldorf, Germany and holds a postdoctoral master’s degree in advanced clinical research from the University of California, San Diego.

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~~Executive Compensation~~EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

This Compensation Discussion and Analysis describes our executive compensation ~~philosophy~~practices and how we implemented ~~it through our 2020 compensation program~~them in the past year for the following seven people (our “named executive officers” or “NEOs”):

(i)

our principal executive officer during ~~2020 (Dr. Pruzanski)~~2021 (Mr. Durso),

(ii)

our principal financial ~~officer~~officers during ~~2020 (Mr. Kapadia)~~2021 (our current CFO Mr. Saik, our former CFO Mr. Kapadia, and our current Chief Accounting Officer Mr. Venezia, who served as interim CFO in 2021),

(iii)

our three other most highly compensated executive officers ~~serving at the end of 2020~~in 2021 (Mr. ~~Durso, Mr. Kim,~~Freedberg, Dr. Berrey, and Dr. ~~Weyer), and~~

~~(iv)~~

two additional former executive officers who would have been among our three other most highly compensated executive officers, but for having left the Company prior to the end of 2020 (Ms. Bright and Mr. Sullivan), each of whom is required to be included under applicable SEC rules.Cawkwell).

Name			Title
~~Mark Pruzanski, M.D.~~Jerome Durso			President and Chief Executive Officer
~~Jerome Durso~~Andrew Saik			Chief ~~Operating~~Financial Officer
Sandip Kapadia			(Former) Chief Financial Officer
Rocco Venezia			(Interim) Chief Financial Officer and ~~Treasurer~~Chief Accounting Officer
~~Richard Kim~~			~~President, U.S. Commercial & Strategic Marketing~~
~~Lisa Bright~~			~~President, International~~
~~Ryan Sullivan~~Jared Freedberg			General Counsel ~~and Secretary~~
~~Christian Weyer,~~M. Michelle Berrey, M.D., ~~M.A.S~~M.P.H.			~~EVP,~~President of Research & ~~Development~~Development; Chief Medical Officer
Gail Cawkwell, M.D., Ph.D.			SVP, Medical Affairs, Safety & Pharmacovigilance

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Executive Summary

~~From 2019 to 2020, we increased Ocaliva net sales, reduced expenses, and improved overall financial results. We moved forward with our development program~~Since the beginning of ~~OCA for~~2021, Intercept has faced many challenges, particularly in the ~~treatment of liver fibrosis due to NASH. We continued to study bezafibrate in combination with OCA for PBC, and advanced the development~~context of our ~~INT-787 compound for future product opportunities. We defended and extended our patent portfolio. We transitioned to new leadership, and have continued in 2021 to develop our~~executive leadership team and executive compensation. In December 2020, our ~~diversity,~~founder and former President and Chief Executive Officer (“CEO”) Mark Pruzanski retired, and Jerome Durso was appointed President and CEO effective January 2021. Since January 2021, there have been departures in a number of other executive positions, including Chief Financial Officer, Chief Medical Officer, President U.S. Commercial & Strategic Marketing, EVP Research & Development, and SVP Corporate Affairs & Investor Relations.

In response to these executive departures, we have promoted strong internal candidates, including our Chief Commercial Officer and our Chief Accounting Officer, and recruited excellent external candidates, including our Chief Financial Officer, our Chief Medical Officer, our General Counsel, and our Chief Quality Officer.

In 2021, our stock price traded at all-time lows, which added significantly to the challenge of managing this period of significant executive turnover, and also affected our equity burn rate (i.e., our rate of issuance of equity compensation). In order to assemble a senior leadership team to help the Company navigate this challenging period and ~~inclusion~~execute on key Company priorities, we assembled market competitive compensation packages that we believed were necessary to attract new talented and capable executives as well as took steps to retain certain executives with historical Company knowledge. The incentivization and retention measures that we implemented included special cash incentive and retention bonuses for certain executive officers, which were structured to be paid in cash in the context of managing our equity burn rate at a sustainable level.

Key Company priorities and team focus included:

•

Ongoing management of our PBC business.

•

Finalization of revisions to our Ocaliva U.S. prescribing information following the FDA’s evaluation of a newly identified safety signal (“~~DEI”~~NISS”) ~~initiatives. Key~~.

•

Ongoing activities regarding our NASH development program and potential resubmission of a New Drug Application in response to our receipt of a complete response letter from the FDA.

A combination of well-designed, appropriately aggressive, and equity-driven offers to external talent, coupled with judicious use of cash retention programs for some existing executives, have resulted in an experienced, well-balanced executive leadership team, and promoted stability in the executive ranks. Executive compensation has been both incentivizing and retentive in nature, and our executives have been effective in contributing to our commercial performance, strengthening our balance sheet and financial position, resolving certain regulatory matters, and ~~operational highlights are further described below.~~advancing our key clinical development programs.

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		~~2020~~2021 Company Performance and Alignment of Interests

		✓ Steady Growth in Ocaliva Net Sales. Our Ocaliva net sales have risen from $18.2 million in 2016 to ~~$312.7~~$363.5 million in ~~2020. They~~2021. Our Ocaliva net sales rose ~~25%~~16% in ~~2020~~2021 as compared to the prior year, and have grown at a ~~34%~~29.5% rate since 2017. ✓ Management Alignment Behind Value Creation. In ~~2020,~~2021, we again granted, as part of our annual equity award program for our executive officers, performance stock unit (“PSU”) awards that vest, if at all, based on total shareholder return (“TSR”), as measured by our common stock relative to the companies comprising the S&P Biotechnology Select Industry Index (our “TSR Peer Group”) over a three-year period, subject to a vesting cap equal to 100% of target in the event that our relative TSR exceeds target but our absolute TSR is negative. Despite the growth of our underlying PBC business, our stock performance over the three-year period that ended in ~~2020~~2021 has meant that ~~certain TSR~~maturing PSUs previously awarded to our ~~executive officers~~NEOs did not vest.* Going forward, our ~~executive officers~~NEOs continue to remain aligned to create shareholder value, both based on the performance of the underlying business and ~~based on~~ share price performance.
		* ~~Except for Dr. Pruzanski, whose TSR PSUs vest pursuant to the terms of his Retirement and Consulting Agreement. See “Executive Compensation—Retirement and Consulting Agreement”.~~

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Key Business Achievements

✓

PBC Business Reported Strongest Year to Date, Achieving Significant Worldwide Ocaliva Net ~~Sales, Despite Ongoing COVID Impact.~~Sales. In ~~2020,~~2021, Ocaliva net sales increased to ~~$312.7~~$363.5 million, up ~~25%~~16% from ~~2019, increasing significantly both domestically and abroad.~~2020.

✓

Reduced Operating Expenses and Improved Financial Results. In ~~2020,~~2021, total operating expenses fell ~~3.6%~~22.9%, which combined with the increase in Ocaliva net sales led to a ~~26%~~75.9% decline in operating loss, from negative ~~$312.4~~$231.2 million to negative ~~$231.2~~$55.7 million. As of December 31, ~~2020,~~2021, we ~~retained $477.2~~had $429.4 million of cash, cash equivalents, restricted cash, and investment debt securities available for sale.

✓

Leveraged Commercial Strengths. We leveraged our commercial strengths, and focused from a sales perspective on specialty product distribution, payor coverage, community education, deep relationships in the liver community, expanded use of virtual communications channels, and other ways to succeed both during and coming out of the COVID-19 pandemic. ~~We also introduced new long-term 5-year data which we believe has resonated well among specialists.~~

✓

Continued Work on NASH Development Program. We ~~have been in discussions with the FDA with respect~~continue to ~~the potential resubmission of our New Drug Application seeking accelerated approval of~~generate clinical research data regarding OCA for the treatment of liver fibrosis due to NASH and are advancing accordingly. In addition, we have continued to conduct a Phase 3 clinical trial in NASH patients with compensated cirrhosis, known as the REVERSE trial.NASH.

✓

Advanced Study of Bezafibrate in Combination with OCA. We ~~have continued~~continue to evaluate the efficacy, safety and tolerability of bezafibrate in combination with OCA in patients with PBC in a Phase 2 study outside the United States. We also have an ongoing Phase 1 study in the United States, are in the process of initiating a Phase 2 study in the United States, and have an open investigational new drug application with the FDA. We are continuing towards a longer-term goal of developing and seeking regulatory approval for a fixed dose combination regimen in this indication and potentially other ~~liver diseases, and we filed an investigational new drug application with the FDA in January 2021 to prepare to expand such development into the United States.~~diseases.

✓

Further Developed INT-787. We ~~have been evaluating~~continue to evaluate our INT-787 ~~compound, which is~~compound. We have a Phase 1 clinical trial, and have submitted an ~~FXR agonist, in preclinical studies in preparation for initiating a first-in-human clinical trial.~~investigational new drug application.

✓

~~Extended the Term of~~Improved Financial Position. We issued new bonds due in 2026, and exchanged existing bonds with an earlier maturity at a ~~Key Patent in Our Intellectual Property Portfolio; Commenced Enforcement Action Against ANDA Filers.~~ ~~In 2020, the U.S. Patent and Trademark Office granted us a five-year patent term extension on~~discount, improving our ~~composition of matter patent for OCA in the United States.~~maturity profile. We also ~~initiated patent infringement lawsuits against five generic drug companies who filed Abbreviated~~reduced our future leasing costs by moving our headquarters from Manhattan to Morristown, New ~~Drug Applications (“ANDAs”) seeking approval for generic versions of Ocaliva.~~Jersey.

✓

~~Developed~~Updated Our Label. We updated our Ocaliva Prescribing Information, to address the Newly Identified Safety Signal.

✓

Continued Development of Our Leadership ~~Team and DEI Initiatives.~~Team. ~~Our~~We have put in place a dynamic executive leadership team ~~led by President and Chief Executive Officer Jerome Durso (who succeeded to that position on January 1, 2021), has~~with significant experience, both at the Company and at other life science companies. Recent key internal promotions include Linda Richardson to Executive Vice President and Chief Commercial Officer, Lisa DeFrancesco to Senior Vice President for Investor Relations and Corporate Affairs, Mary Grendell to Corporate Secretary, and Rocco Venezia to Chief Accounting Officer. Key external hires include Bryan Ballincluding Dr. Michelle Berrey as Chief ~~Quality~~Medical Officer and ~~Jared Freedberg~~Mr. Andrew Saik as General Counsel. We have added experience and diversity of background to our board with Dagmar Rosa-Bjorkeson as a new independent director with significant operating experience in the pharmaceutical industry.Chief Financial Officer.

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CEO Compensation Highlights

~~Our CEO~~

Mr. Jerome Durso became our Chief Executive Officer ~~since~~on January 1, ~~2021,~~2021. Previously, he was our Chief Operating Officer. Mr. Durso has been with Intercept since 2017, and has over 25 years of life sciences experience, including in operational, managerial, marketing, and sales positions. ~~He has been with Intercept since 2017, and was previously our Chief Operating Officer. Mr. Durso’s compensation is designed to be highly aligned with creation of stockholder value.~~

Mr. Durso succeeds as our Chief Executive Officer our founder Dr. Pruzanski, who retired effective December 31, 2020. Dr. Pruzanski remains a consultant for the Company. The terms of his Retirement and Consulting Agreement are discussed below under “Executive Compensation—Retirement and Consulting Agreement.

✓

~~Market-Based Compensation.~~ ~~For~~Mr. Durso leads a highly experienced executive leadership team, and his compensation in both 2021 ~~we determined total Chief Executive Officer compensation (including annual equity awards) with reference to~~and 2022 was set based on competitive market forces, specifically based on the 50th percentile of ~~the competitive market based on~~ our compensation peer group.

✓

~~Significant Performance Elements.~~ ~~For~~ His compensation is also designed to be aligned with creation of stockholder value. In 2021, we incorporated significant performance elements into our Chief Executive Officer’s annual and long-term incentive compensation arrangements, including TSR PSUs. These variable compensation elements are dependent on our achievement of corporate performance goals and on stock price performance. With effect from the datehis cash salary represented 9% of his ~~promotion to the role of President~~total compensation, non-equity incentive pay represented 6%, options represented 16%, RSUs represented 17%, and ~~Chief Executive Officer, Mr. Durso’s entire cash incentive bonus, targeted at 70%~~PSUs represented 52%. Overall, 85% of his ~~base salary, is based on the achievement of corporate goals.~~

✓

~~Equity Awards Geared Towards Performance.~~ ~~100% of Mr. Durso’s long-term incentive~~ compensation ~~for 2021 is~~was in ~~the form of~~ equity awards, ~~granted under our annual~~which aligned his compensation with stockholder value creation. Notably, the largest component of his equity ~~award program. Approximately 60% of the total grant date fair value of our Chief Executive Officer’s 2021 annual equity grant~~compensation was in the form of ~~TSR~~ PSUs, which as described above vest based on stock performance both in absolute terms and relative to our TSR Peer Group. ~~Another 20%~~Also, for both 2021 and 2022, Mr. Durso’s cash incentive bonus was inset at 70% of his base salary, the ~~form~~highest of ~~stock options, which can be exercised for value only if the stock price exceeds the strike price. The remaining 20% was granted in the form of RSUs.~~

✓

~~Executive Leadership.~~ ~~Our Chief Executive Officer leads a highly experienced executive team with years of relevant industry experience.~~

~~Stockholder Outreach~~

~~Overview.~~ We are committed to establishing and maintaining an open and transparent dialogue with our stockholders with respect to executive compensation and important governance matters. Each year, we engage with our stockholders to request feedback regarding our executive compensation program and other governance matters of importance to our stockholders. Stockholder feedback is then reported to our Compensation Committee and Nominating and Governance Committee and to the full Board for consideration.

~~Stockholder Advisory Vote on Executive Compensation.~~ ~~Each year, our stockholders are provided the opportunity to cast an advisory vote on the compensation~~any of our ~~named executive officers (a “say-on-pay” vote),~~employees, and ~~our Compensation Committee considers the outcome~~evaluated solely based on achievement of the prior year’s say-on-pay vote when making decisions relating to the compensation of our named executive officers and our executive compensation program. Our 2020 advisory say-on-pay proposal was approved by approximately 94.5% of the votes cast on the proposal. We continue to work to understand our stockholders’ perspectives concerning our executive compensation program, and remain committed to

corporate goals.

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our stockholder engagement activities. In 2020, we reached out to stockholders representing over 70% of our outstanding shares, including each of our largest stockholders. Participants at our meetings with such stockholders included members of our executive management team, and the Chairperson of our Compensation Committee and Lead Independent Director. In 2021, we also are holding an advisory “say-on-frequency” vote, Proposal 4 discussed above. We recommend continuing to hold the “say-on-pay” vote annually, so that we can continue to be informed of and responsive to stockholder views about our executive compensation program, but will take into account any alternative feedback that we receive from our stockholders.

~~Stockholder Feedback.~~ We believe that our outreach was well received, and many of the stockholders that we contacted in 2020 informed us that they were generally pleased with our approach to executive compensation and did not feel the need to meet to discuss such matters in detail. Generally, the stockholders that we did meet with have a long-term outlook and understand that we regularly review and refine our compensation programs as we pursue both research and development of our product candidates as well as commercial goals with respect to our approved product Ocaliva, against the backdrop of a competitive and dynamic industry. In these interactions, among other matters, we discussed our performance-based compensation philosophy, including our practice of granting TSR PSUs to our executive officers. We consistently heard from these stockholders that they appreciated our efforts to engage with them on our compensation philosophy and practices, and they encouraged us to continue our outreach on a regular basis.

~~Commitment to Future Outreach.~~ We believe that stockholder engagement is important, and our Compensation Committee will continue to consider stockholder feedback, future say-on-pay votes, and relevant market developments in order to determine whether any subsequent changes to our executive compensation program are warranted. We expect to continue our outreach efforts with respect to executive compensation and important governance matters in future years in order to ensure that we collect stockholder feedback for the consideration of our Compensation Committee, Nominating and Governance Committee, and full Board.

Compensation and Governance Best Practices

What We Do

✓

Independent Chairman and Majority Independent Board. Paolo Fundarò serves as our Board’s Chairman, and all of the members of our Board other than our current ~~Chief Executive Officer~~CEO (Mr. Durso), and our founder and retired ~~Chief Executive Officer~~CEO (Dr. Pruzanski) are independent directors.

✓

Additional Independent Board Leadership and Diversity. Gino Santini serves as our Board’s Lead Independent Director, which we believe enhances our Board governance structure and contributes to the overall effectiveness of our Board. In addition, in April 2018 and April 2021, we appointed Nancy Miller-Rich and Dagmar Rosa-Bjorkeson, respectively, as independent directors to our Board, which increased the gender diversity of our Board. We continue to strive to achieve an appropriate balance of diverse backgrounds on the Board and its committees, including in regard to background, perspective, experience, age, gender, and ethnicities, and in February 2021 we revised our Corporate Governance Guidelines to further enhance our commitment to diversity.

✓

Independent Compensation Committee. Our Compensation Committee, which is composed entirely of independent directors, provides independent oversight of our compensation programs.

✓

Independent Compensation Consultant. Our Compensation Committee uses an independent executive compensation consulting firm that reports directly to the ~~committee.~~Compensation Committee.

✓

Annual Compensation Review and Analysis. Our Compensation Committee conducts an annual assessment of executive compensation to ensure that we provide competitive compensation packages to attract, retain, reward, and incentivize our executive management team to achieve success for us and our stockholders.

✓

Multiple Performance Elements. In accordance with our performance-based compensation

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philosophy, our executive compensation program incorporates multiple performance elements, including target-based cash incentive bonuses payable upon the achievement of corporate goals and individual performance, and long-term equity incentive compensation, a substantial portion of which consists of stock options and ~~TSR~~ PSUs.

✓

Significant Portion of Compensation Is at Risk. Under our executive compensation program, a significant portion of compensation is “at risk” based on our performance, including annual cash incentive bonuses, and long-term incentive compensation in the form of equity awards, to align the interests of our executive officers and stockholders.

✓

Market Benchmarking and Use of Reference Peer Group. Our Compensation Committee, with the assistance of its independent compensation consultant, annually analyzes similar life science companies to identify a relevant group of peer companies for purposes of ensuring the reasonableness and competitiveness of our executive compensation program.

✓

Stock Ownership Requirements. We have adopted minimum stock ownership guidelines for our Board, Chief Executive Officer, and other executive officers, including our named executive officers, which require, within specified periods of time, our non-employee directors to hold Company equity with a value equal to at least 3x their annual cash retainer, and our Chief Executive Officer and other executive officers to hold Company equity with a value equal to at least 3x and 1x, respectively, their annual base salary.

✓

Clawback Policy. We have adopted a clawback policy that permits the Company to recover from any current or former executive officer, including any named executive officer, whose fraud or intentional misconduct contributes to the circumstances requiring the Company to prepare an accounting restatement due to material non-compliance of the Company with any financial reporting requirement under U.S. federal securities laws, up to 100% of any incentive-based compensation received by such officer from the Company during the one-year period preceding the date on which the Company is required to prepare such accounting restatement.

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✓

Corporate Governance Guidelines. In 2019, we adopted corporate governance guidelines reflecting our Board’s commitment to building long-term stockholder value with an emphasis on corporate governance. The Nominating and Governance Committee periodically reviews the adequacy and effectiveness of our corporate governance guidelines and recommends any proposed changes to the Board for approval. InFollowing initial adoption, we have amended our corporate governance guidelines, including an amendment in February 2021 ~~we amended those guidelines~~ to emphasize our commitment to diversity, equity, and inclusion (“DEI”).

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What We Don’t Do

✘

No excise tax gross-ups. We have not provided, or committed to provide, excise tax gross-ups to any of our named executive officers.

✘

No change in control “windfalls”. The change in control protections for our named executive officers are limited to “double-trigger” arrangements, which require both a change in control and a qualifying termination of employment, or in the case of ~~TSR~~ PSUs, vesting, if at all, based on our TSR performance relative to that of our TSR Peer Group through the month preceding the month in which the change in control occurs.

✘

Limited perquisites. Our named executive officers generally receive the same benefits as are available to all of our salaried employees, with limited recurring exceptions primarily consisting of fully-paid health insurance premiums.

✘

No automatic or guaranteed annual salary increases. We do not provide for any formulaic or guaranteed base salary increases for our named executive officers.

✘

No guaranteed bonuses or annual equity grants. We do not provide guaranteed bonuses or annual equity grants to our named executive officers. ~~In addition, our Compensation Committee determined to maintain the 2020 annual cash incentive bonus target percentages for our named executive officer positions at their 2019 levels.~~

✘

No hedging or pledging of Company stock. Our named executive officers and other employees are restricted from engaging in speculative trading activities, including hedging or pledging ~~their company~~Company securities as collateral.

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Executive Compensation Philosophy

We have ~~adopted~~ a performance-based compensation philosophy that is intended to attract, retain, reward, and incentivize our executive officers to achieve both our ~~near-term~~short-term and long-term corporate ~~goals, as well as our long-term~~and strategic ~~objectives.~~ goals.

In particular, our philosophy is designed to achieve the following objectives:

•

~~reward the~~Reward achievement of measurable corporate ~~objectives, and align~~objectives.

•

Align executive officers’ incentives with increasing stockholder ~~value;~~value.

•

~~attract,~~Attract, retain, and motivate highly talented individuals with the skills and demonstrated abilities necessary to drive our continued success and deliver superior execution of our ~~short- and long-term strategic plans, and drive our continued success;~~goals.

•

~~provide~~Provide executive compensation that is competitive with ~~that paid by~~ our peers in the ~~competitive and~~ dynamic biopharmaceutical ~~industry;~~industry.

•

~~appropriately~~Appropriately balance cash compensation, designed to encourage ~~the~~ achievement of critical annual goals, with equity incentives, designed to inspire ~~the~~ achievement of long-term objectives and align ~~the interests of~~ our ~~executive officers more closely~~executives with ~~those of~~ our ~~stockholders; and~~stockholders.

•

~~align the~~Align our compensation principles for ~~our executive officers~~executives with those for ~~all~~ employees generally, helping to ~~help~~ create a company-wide ~~performance culture.~~culture of high standards and performance.

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Stockholder Outreach and Feedback

Overview

We are committed to establishing and maintaining an open and transparent dialogue with our stockholders with respect to executive compensation and important governance matters. Each year, we engage with our stockholders to request feedback regarding our executive compensation program and other governance matters of importance to our stockholders. Stockholder feedback is then reported to our Compensation Committee, Nominating and Governance Committee, and full Board for consideration.

Stockholder Advisory Vote on Executive Compensation

Each year, our stockholders are provided the opportunity to cast an advisory vote on the compensation of our named executive officers (a “say-on-pay” vote), and our Compensation Committee considers the outcome of the prior year’s say-on-pay vote when making decisions relating to the compensation of our named executive officers and our executive compensation program.

In 2021, our say-on-pay proposal garnered 65% support and 35% opposition. Our understanding is that opposition related primarily to the payouts to retired CEO Mark Pruzanski under his Retirement and Consulting Agreement, discussed in the table below, and as identified by Institutional Shareholder Services Inc. (“ISS”) in their vote recommendation against the proposal.

Outreach and Feedback Process

In 2021, we contacted approximately 70% of our stockholders by share count, including each of our largest stockholders, to discuss the say-on-pay vote and other topics. If stockholders were interested in meetings, we arranged meetings, with participants including executive officers and the chair of our Compensation Committee.

We believe that our outreach was well received, and we collected constructive feedback from many of our stockholders. Generally, the stockholders we met with have a long-term outlook and understand that our compensation programs need to evolve over time to reflect corporate conditions. Below is a summary of specific key areas of stockholder focus, and our responses regarding them.

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Conclusions

Engagement with our stockholders is important, and we have heard from stockholders that they appreciate our engagement efforts. Feedback regarding executive compensation was generally favorable, with the exception of the terms of Dr. Pruzanski’s Retirement and Consulting Agreement and PSU payout, and most stockholders that we met did not see the need to discuss other executive compensation issues in detail.

Our Compensation Committee will continue to consider stockholder feedback, future say-on-pay votes, and relevant market developments to determine whether future changes to our executive compensation program are warranted. We expect to continue our outreach efforts regarding executive compensation and other important governance matters to ensure that we collect stockholder feedback for consideration by our Board and its committees.

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Our Executive Compensation Process

The Role of the Compensation Committee

Our Compensation Committee is responsible for the evaluation and oversight of our executive compensation program, policies, and practices. Accordingly, ~~our Compensation Committee~~the committee reviews and approves all compensation provided to our named executive officers, including adjustments to base salaries, annual target-based cash incentive bonuses, equity incentive awards, severance arrangements, and benefit programs. ~~Our Compensation Committee~~The committee consists of three members of our Board, each of whom has extensive experience in our industry and is an independent director under applicable Nasdaq and SEC rules. ~~Our Compensation Committee~~The committee uses its judgment and experience to develop and approve our executive compensation program, including our ~~Chief Executive Officer’s~~CEO’s compensation package. In doing so, ~~our Compensation Committee~~the committee periodically meets with an independent compensation consultant in executive session without our ~~Chief Executive Officer~~CEO or any other member of management present. ~~Our Compensation Committee~~The committee also periodically evaluates the need for revisions to our executive compensation program to ensure our program is competitive with the companies with which we compete for executive talent.

Management’s Involvement in the Executive Compensation Process

A small number of ~~executive~~Company officers, including our ~~Chief Executive Officer,~~CEO, participate in general sessions, ~~of our Compensation Committee. Management does~~but not ~~participate in~~ executive sessions, of our Compensation Committee. At the request of the committee, our ~~Compensation Committee, our Chief Executive Officer~~CEO provides input and recommendations to the committee on salary adjustments, annual target-based cash incentive bonus amounts, and appropriate equity incentive compensation levels ~~in relation to our~~for executive officers other than himself. In formulating these recommendations, our ~~Chief Executive Officer~~CEO may consider data obtained from third-party sources, including data provided by compensation consultants other than the independent compensation consultant retained by ~~our Compensation Committee.~~the committee.

Use of an Independent Compensation Consultant by the Compensation Committee

In designing our executive compensation program, our Compensation Committee considers as a reference point publicly available compensation data for other companies in the biopharmaceutical industry to help guide its executive compensation decisions at the time of hiring and for subsequent adjustments in compensation. In ~~2020,~~2021, as in prior years, ~~our Compensation Committee again~~the committee retained ~~the services of the~~Aon plc’s Rewards Solution practice, ~~at Aon plc, specifically members of~~known as Radford, as an independent compensation consultant, to provide itthe committee with additional comparative data on executive compensation practices in our

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industry and to advise itthe committee on our executive compensation program generally. For ~~2020,~~2021, Radford provided advice and data to ~~our Compensation Committee~~the committee on executive and director compensation matters, including the selection of our compensation peer group, comparative market pay levels, equity dilution, annual share utilization practices, incentive plan design, and trends emerging ~~market trends.~~in the market. Although ~~our Compensation Committee~~the committee considers the advice and recommendations of ~~its~~the compensation consultant, ~~about our executive compensation program,~~ the committee ultimately makes its own ~~decisions about these matters. Our Compensation Committee~~decisions. For 2021, the committee determined that ~~the~~Radford’s work ~~of Radford~~ did not raise any conflicts of ~~interest in 2020.~~interest. In making this assessment, ~~our Compensation Committee~~the committee considered the independence factors enumerated in the applicable Nasdaq rules.

Peer Group

Our Compensation Committee references a peer group of publicly traded companies in the biopharmaceutical industry for purposes of gathering data to compare with our existing executive compensation levels and practices and as context for future compensation decisions. ~~Our Compensation Committee,~~The committee, with the assistance of its independent compensation consultant, periodically reviews and, if appropriate, updates the compensation peer group, as appropriate, to include companies that the ~~Compensation Committee~~committee believes are competitors for executive talent and are similar to us based on a number of criteria, including sector, market capitalization, revenue, stage of development, and head count. ~~Our Compensation Committee~~The committee may consider peer group and other industry compensation data and the recommendations of its independent compensation consultant when making decisions related to executive compensation. ~~Our Compensation Committee~~The committee also considers data with respect to peer companies identified by proxy advisory firms in the prior year’s proxy cycle. ~~Our Compensation Committee,~~

At the end of 2020, the committee, with input from its independent compensation consultant, reviewed the ~~composition of our 2019~~prior year’s compensation peer group and determined the appropriate modifications required for ~~2020~~the year ahead, including based on size (e.g., market capitalization, revenues, and head count) and stage of ~~development.~~

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development, and removing companies as appropriate, for example due to their merging or being acquired. The companies included in our compensation peer group for ~~2020~~2021 were as follows:

~~ACADIA Pharmaceuticals Inc.~~Alkermes	~~Insmed, Inc.~~bluebird bio	~~Radius Health, Inc.~~FibroGen
~~Alkermes plc~~Ironwood	~~Ionis Pharmaceuticals, Inc.~~Heron Therapeutics	~~Seagen, Inc.~~Halozyme Therapeutics
~~Alnylam Pharmaceuticals, Inc.~~Pacira Biosciences	~~Neurocrine Biosciences, Inc.~~Ligand Pharmaceuticals	Insmed
Radius Health	Portola Pharmaceuticals (as of 05/01/20)	Omeros
United Therapeutics	Supernus Pharmaceuticals	PTC Therapeutics
		Ultragenyx Pharmaceuticals

Likewise, at the end of 2021, the committee modified our peer group for the year ahead, based on updated information. Our peer group for 2022 is as follows:

Akebia Therapeutics, Inc.
Amarin Corporation	bluebird bio, Inc.	~~Omeros Corporation~~	~~The Medicines Company (acquired)~~
~~Exelixis,~~Coheres BioSciences, Inc.	~~Pacira Pharmaceuticals,~~Collegium Pharmaceutical, Inc.	~~Ultragenyx Pharmaceutical~~Esperion Therapeutics, Inc.
FibroGen, Inc.	~~Portola Pharmaceuticals,~~Heron Therapeutics Inc. ~~(acquired)~~	~~United Therapeutics~~Ironwood Pharmaceuticals, Inc.
Ligand Pharmaceuticals Incorporated	MidMedx Group, Inc.	Omeros Corporation
~~Halozyme Therapeutics,~~Pacira Pharmaceuticals, Inc.	PTC Therapeutics Inc.	Puma Biotechnology, Inc.
Radius Health, Inc.	Supernus Pharmaceuticals, Inc.	Vanda Pharmaceuticals Inc.

Likewise, at the end of 2020, our Compensation Committee, with input from its independent compensation consultant, determined appropriate modifications for our peer group for 2021, based on updated information concerning the market capitalization of the Company and potential peer companies; taking into consideration the Company’s and its peers’ stages of development, revenues, and head count; and removing companies as appropriate, for example on account of their being acquired.

Market Benchmarking

In early ~~2020,~~2021, based on the input and analysis provided by Radford and the recommendation of our ~~Chief Executive Officer~~CEO (except ~~with respect to~~for his own compensation), ~~our Compensation Committee~~the committee determined that ~~2020~~2021 target total ~~direct~~cash and equity compensation for our ~~Chief Executive Officer~~CEO and other ~~named executive officers employed by the Company would~~NEOs should be determined with reference to the 50th percentile of compensation for executives holding similar positions at the companies in our compensation peer group, with the understanding that due to our volatile stock price and corresponding changes in our size and peer group that certain metrics would be temporarily distorted and appear higher or lower than our current peer group. In determining each named executive officer’s equity incentive award, ~~our Compensation Committee~~the committee examined peer group compensation data provided by Radford and other related compensation data.

Annual Compensation Review Process

On an annual basis, ~~our Compensation Committee~~the committee meets to review the performance of our ~~Chief Executive Officer~~CEO and our other ~~named executive officers.~~NEOs. At these meetings, ~~our Compensation Committee~~the committee typically invites our ~~Chief Executive Officer~~CEO to participate in the ~~discussion (excluding~~ discussions ~~pertaining to~~(except for his own compensation) in order to seek our ~~Chief Executive Officer’s~~CEO’s input and recommendations with respect to each ~~named executive officer~~NEO (other than himself) as to:

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•

~~the~~The achievement of stated corporate performance objectives;

•

~~the~~The level of contributions made to the general management and guidance of the Company; and

•

~~the~~The amount of any salary increases, cash incentive bonus payouts, and new equity awards.

~~Our Compensation Committee~~The committee takes into consideration these recommendations and other relevant performance and competitive market factors when it ~~makes its determination on~~determines executive ~~compensation matters. Our Compensation Committee~~compensation. The committee also meets to monitor, review, and decide compensation matters periodically throughout the year.

Compensation Risk Assessment

We periodically evaluate our compensation programs to understand which elements, if any, may pose risk to the Company and from time to time adopt additional compensation policies and practices designed to discourage excessive or unnecessary risk-taking on the part of program participants. The Company, with the assistance of anits independent compensation consultant, ~~Radford,~~ has reviewed Company compensation policies and practices, both for executive and non-executive employees, and determined that those policies and practices do not create risks that are reasonably likely to have a material adverse effect on the Company. In conducting this review, we considered various features of our compensation policies and practices that discourage excessive or unnecessary risk-taking, including, but not limited to, the following:

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•

~~oversight~~Oversight of our compensation policies and practices by our Compensation Committee, including with respect to performance goal setting and the evaluation of achievement ~~thereunder;~~thereunder.

•

anAn effective balance between fixed and variable compensation, and short-term and long-term incentive ~~opportunities;~~opportunities.

•

~~diversity~~Diversity in long-term incentive ~~vehicles;~~vehicles.

•

~~the~~The adoption of performance measures that support the achievement of key goals and the Company’s business ~~strategy;~~strategy.

•

~~the~~The inclusion of risk-mitigating features (such as the clawback policy) in the Company’s compensation ~~programs; and~~programs.

•

~~reasonable~~Reasonable severance and change in control arrangements.

Components of Our Executive Compensation Program

The primary elements of our executive compensation program are:

•

~~base~~Base salary;

•

~~annual~~Annual target-based cash incentive bonuses;

•

~~equity~~Equity incentive awards;

•

~~broad-based~~Broad-based health and welfare benefits; and

•

~~balanced~~Balanced severance arrangements.

Our Compensation Committee believes that a significant amount of executive compensation should be in the form of “at risk” incentives and that the pay mix should be strongly weighted toward equity incentive awards in order to provide alignment with long-term stockholder value. However, we do not have a formal or informal policy for a pre-set allocation between long-term and short-term compensation, between cash and non-cash compensation, or among different forms of non-cash compensation. Instead, ~~our Compensation Committee,~~the committee, after reviewing information provided by its independent compensation consultant and other relevant data, determines what it believes to be the appropriate level and mix of the various compensation components. We generally strive to provide our executive officers with a balance of short-term and long-term incentives to encourage consistently strong performance. Ultimately, the objective in allocating between long-term and currently paid compensation is to ensure adequate base compensation to attract and retain personnel, while providing incentives to maximize long-term value for the Company and its stockholders. Therefore, we provide base salaries that meet competitive salary norms, while also recognizing and ~~recognize~~

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rewarding Company and individual ~~performance on an annual basis.~~performance. We provide an opportunity to earn annual target-based cash incentive bonuses to incentivize and reward superior short-term performance. To further focus our executive officers on longer-term performance and the creation of stockholder value, we rely upon equity-based awards that vest over a meaningful period of time, ~~and~~ the values of which are dependent on stock price performance.

Base Salary

We use base salaries to recognize the experience, skills, knowledge, and responsibilities of our employees, including ~~our executive officers and named~~ executive officers. Base salaries for newly-hired executive officers typically are established through an arm’s-length negotiation at the time ~~that the individual is hired,~~of hiring, taking into account factors such as the position for which the individual is being considered, the individual’s qualifications, prior experience, prior base salary ~~(to the extent available)~~(if available and if legally permissible), and competitive market demand. None of our ~~named executive officers~~NEOs is currently party to an employment agreement that provides for automatic or scheduled increases in base salary. On an annual basis, our Compensation Committee reviews and evaluates, with input from our ~~Chief Executive Officer (other than with respect to~~CEO (except for his own base salary), the need for adjustment of the base salaries of our executive officers, based on changes and expected changes in the scope of their responsibilities. ~~Our Compensation Committee~~The committee also considers promotions, the contributions made by and performance of the executive officer during the prior ~~fiscal~~ year, the individual’s performance over a period of years, overall economic and labor market conditions, the relative ease or difficulty of ~~replacing the individual with~~obtaining a well-qualified ~~person,~~replacement, our overall growth and development as a company, general salary trends in our industry and among our compensation peer group, and where the

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individual’s salary falls in the salary range presented by that data. Compensation trends and cost of living increases in ~~the New York City metropolitan area, where our headquarters is located,~~relevant geographic areas may also factor into such evaluation. ~~For more information regarding our compensation peer group, see “—Our Executive Compensation Process—Peer Group” above. In addition, our Compensation Committee~~The committee may also draw upon ~~the~~Board members who have experience ~~of members of our Board with~~making salary increase decisions at other ~~companies in making decisions regarding salary increases.~~companies.

For 2022, 2021, and 2020, our ~~Compensation Committee determined annual~~NEO base salaries for each of our named executive officers based on their overall individual performance in 2019 and their increased level of experience, and to ensure that their salaries remained competitive with those of similarly situated executives in our compensation peer group. For 2020 and 2019, the annual base salaries for each of our named executive officers were as follows:

Named Executive Officer
2020
Salary(1)

2019
Salary

Change
from 2019

Mark Pruzanski, M.D. $ 759,992 $ 734,292 3.50%
Jerome Durso $ 601,913 $ 573,250 5.00%
Sandip Kapadia $ 478,023 $ 464,100 3.00%
Richard Kim $ 457,294 $ 442,900 3.25%
Lisa Bright(2)
$ 481,910 $ 465,613 3.50%
Ryan Sullivan $ 461,113 $ 445,520 3.50%
Christian Weyer, M.D., M.A.S. $ 488,011 $ 472,650 3.25%

Name	2022 ($)		2021 ($)		2020 ($)		Change 2021 to 2022 (%)		Change 2020 to 2021 (%)
Jerome Durso		717,000		690,750		601,913		3.80%		14.76%
Andrew Saik		493,000		475,000		—		3.79%		N/A
Sandip Kapadia		—		497,140		478,023		N/A		4.00%
Rocco Venezia		381,500		318,010		308,000		19.96%		3.25%
Jared Freedberg		479,000		461,600		—		3.77%		N/A
Michelle Berrey		622,500		600,000		—		3.75%		N/A
Gail Cawkwell		498,000		479,950		461,492		3.76%		4.00%

~~(1)~~

~~The change to~~Generally, the ~~annual base salary of each named executive officer, as applicable, was effective as of February 1, 2020. Amounts displayed in this~~ table ~~are the~~above reflects annual base salaries determined by ~~our~~the Compensation ~~Committee. For actual salary~~Committee, effective for each year beginning on February 1. Actual salaries earned during the year, including during January at the previously applicable salary, ~~please refer to~~are provided in the “Summary Compensation Table” below. ~~Please refer~~

For Mr. Durso, the 2021 increase reflects his promotion to ~~“—Compensation Decisions Relating~~CEO. For Mr. Saik, Mr. Freedberg, and Dr. Berrey, 2021 salaries reflect their employment agreements as new hires. Mr. Kapadia left the Company in 2021. For Mr. Venezia, the 2021 and 2020 salaries reflect his pre-NEO salaries, which were not approved by the committee, since he was not an executive officer at the time. Following his promotion to ~~Fiscal Year 2021” below for a listing of the annual base salaries of each of our named executive officers for~~Chief Accounting Officer, Mr. Venezia’s 2021 ~~based on the same methodology as used by this table.~~

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~~(2)~~

~~The annual base salaries are reported in dollars. The~~ salary ~~for Ms. Bright~~ was ~~paid in British Pounds. All amounts paid~~increased to Ms. Bright that were denominated in British Pounds have been converted for reporting purposes in this proxy statement to dollars based on an exchange rate of 1.3711 dollars to the pound as of December 31, 2020, based on the exchange rates in the Company’s accounting system based on an external data source.$365,000.

Annual Target-Based Cash Incentive Bonuses

As part of our performance-based compensation philosophy, our annual target-based cash incentive bonus program is designed to reward our ~~named executive officers~~NEOs for the achievement of specified, measurable annual corporate goals and (with respect to our ~~named executive officers~~NEOs other than our ~~Chief Executive Officer)~~CEO) individual goals and contributions. At the beginning of each year, the ~~cash incentive~~target bonus ~~opportunity~~ for each ~~named executive officer~~NEO is ~~established~~set by the Compensation Committee as a ~~target~~ percentage of such officer’s base salary. The ~~actual annual cash incentive~~target bonus ~~amounts payable~~percentages set by the committee are typically based on an evaluation of compensation peer group data, as well as consideration of the level of qualification and experience of each NEO as well as internal pay comparisons. Based on this evaluation, the committee determined in 2021 and 2022 to ~~our named executive officers~~maintain the target percentages at the same levels as for prior years.

Actual bonus amounts are determined after ~~year end~~year-end based on ~~our Compensation Committee’s~~the committee’s evaluation of performance against the corporate goals and ~~in the case of~~(except for our ~~named executive officers other than our Chief Executive Officer,~~CEO) individual performance. ~~Individual~~NEO individual performance ~~of the named executive officers (other than~~(except for our ~~Chief Executive Officer)~~CEO) is assessed by ~~our Compensation Committee~~the committee after considering the performance of each officer based on specific goals, individual contributions, and the recommendations of our CEO. Generally, the ~~Chief Executive Officer. Generally, our Compensation Committee~~committee determines that a cash incentive bonus opportunity for the ~~Chief Executive Officer~~CEO for the prior year will be based entirely on the achievement of corporate goals. ~~Due to the retirement of Dr. Pruzanski~~For 2020 performance, paid in ~~December 2020, neither the outgoing Chief Executive Officer Dr. Pruzanski nor the incoming Chief Executive Officer~~2021, Mr. Durso ~~received a cash incentive bonus~~instead was evaluated based on ~~this basis. Rather, Mr. Durso received a cash bonus corresponding to~~ his work as our Chief Operating Officer ~~in 2020. Dr. Pruzanski received a cash bonus pursuant~~(prior to his promotion to CEO at the ~~terms~~beginning of ~~his Retirement and Consulting Agreement. See “Executive Compensation—Retirement and Consulting Agreement”~~2021).

~~Our Compensation Committee~~The committee believes that a cash incentive bonus program based on the evaluation of multiple corporate goals and (except for our CEO) individual performance ~~(with respect to our named executive officers other than our Chief Executive Officer)~~ is ~~best-suited~~best suited for a biopharmaceutical company at our stage of development, due to the uncertainties inherent in the development, regulatory approval, and commercialization of new drug treatments. ~~Our Compensation Committee~~The committee also considers the practices of our compensation peer group and overall industry practices as part of its review of our ~~cash incentive~~ bonus program. In order to better align cash incentive bonus payouts with performance, our Compensation Committee may take additional significant corporate achievements into account for the current year’s cash incentive bonus calculation that were not contemplated at the time that the current year corporate goals were determined. Our Compensation Committee also has the authority to shift corporate goals to subsequent fiscal years and to eliminate them for the current year’s cash incentive bonus calculation if it determines that underachievement of a goal was primarily caused by circumstances that were beyond the named executive officer’s control or if it determines that the business priorities for the year had shifted. Each of our Compensation Committee and Board has authority, in its sole discretion, to review and approve management’s evaluation of how we performed against our corporate goals and the recommended cash incentive bonus payout levels. This authority includes the ability to rate the accomplishment of particular goals at below, equal to, or greater than 100% of target, based on the Company’s performance. Our Compensation Committee’s assessment of the individual performance of our named executive officers (other than our Chief Executive Officer) may result in such officers receiving cash incentive bonuses that are higher or lower than the amounts that they would otherwise receive if such bonuses were based on the achievement of corporate goals alone.

The target annual cash incentive bonus for each named executive officer is set by our Compensation Committee as a percentage of such officer’s base salary. The target percentages approved by our Compensation Committee are typically based on an evaluation of compensation peer group data, as well as consideration of the level of qualification and experience of each named executive officer as well as internal pay comparisons. Based on this evaluation, our Compensation Committee determined to maintain the 2020 annual cash incentive bonus targets at the same levels as prior years for our named executive officers.

Our annual corporate goals have historically included the achievement of specific clinical, regulatory, operational and/or financial milestones, with a focus on the advancement of our product candidates in

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clinical development, the pursuit of various internal initiatives, and ensuring adequate funding for our growth. As we continue to ~~pursue both~~ research and ~~development of~~develop our product candidates, as well as pursue commercial goals

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with respect to our approved product Ocaliva, we have included pre-commercial and commercial-related milestones in our annual corporate goals, with a focus on pre-commercial deliverables, commercial deliverables, and commercial ~~preparedness, commercial sales targets, and regulatory achievements.~~financial targets. The corporate goals are proposed by senior management ~~at the beginning of~~early each ~~fiscal~~ year, and are approved by ~~our Compensation Committee~~the committee and the Board with such modifications as ~~our Compensation Committee~~the committee and the Board deem appropriate. In connection with such approval, ~~our Compensation Committee~~the committee and the Board conduct a rigorous review designed to ensure that such goals reflect the corporate performance measures that we believe are most important to the success of the Company and will drive stockholder value. In addition, the corporate goals are generally set at challenging “stretch” levels so as to require our ~~named executive officers~~NEOs to expend substantial effort and commitment leveraging their individual and collective skills and competencies to attain such goals.

~~Our 2020~~In order to better align bonus payouts with performance, the committee may consider for bonus calculations significant corporate achievements that were not contemplated at the time that the corporate goals were set. The committee also has the authority to shift corporate goals to subsequent years and to eliminate goals for the current year if it determines that underachievement of a goal was primarily caused by circumstances beyond an NEO’s control, or that business priorities have shifted. The Compensation Committee and the Board each have the authority, each in their sole discretion, to review and approve management’s evaluation of how the Company performed against our corporate goals, and management’s recommended bonus payout levels. This authority includes the ability to rate the accomplishment of particular goals below, at, or above 100% of target, based on the Company’s performance. The committee’s assessment of the individual performance of our NEOs (except for our CEO) may result in such officers receiving bonuses that are higher or lower than the amounts that they would otherwise receive if such bonuses were based on achievement of corporate goals alone.

For 2021, our corporate goals, their relative weightings, ~~and the achievement levels assessed by our Compensation Committee are summarized below:~~

2020 Corporate Goal Summary
Relative
Weighting

Assessed
Achievement

NASH Program 50% 15%
Includes specified activities and milestones related to:
•
securing FDA approval for OCA in NASH

•
executing the launch of OCA in NASH in accordance with the Company’s launch preparation plans

•
ensuring that launch plans are in place, including with respect to targeting, organizational capabilities, competencies and team engagement, and that appropriate launch preparations are executed in a timely way

PBC Commercial Program 25% 30%
Includes specified commercial milestone as follows:
•
achieve pre-specified Ocaliva total unit sales for 2020

Pipeline 15% 15%
Includes specified activities and milestones related to:
•
manufacturing selected fixed-dose combination (“FDC”) formulation for potential use and study

•
timing and completion of key activities required to prepare for first-in-human clinical trial of INT-787

Organization 10% 10%
Includes specified activities and milestones related to:
•
effective organizational management related to human resources, capabilities, and competencies for executing on organizational priorities, including potential launch of OCA for liver fibrosis due to NASH

•
recruiting and training of appropriate staff

•
appropriate management of expenses and headcount

Total 100% 70%

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~~In early 2021, our Compensation Committee considered~~ our performance, ~~in light of the above goals, together with other information available~~and our weighted performance are below. Weights sum to ~~it, such as the disruption caused~~100% within each category, and across categories. Weighted performance is calculated by multiplying each performance score by the ~~COVID-19 pandemic and the CRL, and determined that our 2020 corporate goals, with regards to our named executive officers, were achieved in the aggregate at 70%.~~

The cash incentive bonus for our named executive officers (other than our Chief Executive Officer) is based on both our corporate goals and individual performance. Key 2020 individual goals for, and achievements of, our named executive officers (other than our Chief Executive Officer) eligible for bonuses due to continued employment with the Company were as follows:

•

Mr. Durso: Mr. Durso was responsible for the oversight of the global commercial business of Ocaliva for PBC and its strong 2020 financial performance. In addition to the PBC business, Mr. Durso was integrally involved in directing the launch preparation work for OCA for liver fibrosis due to NASH, particularly the investment planning for the potential U.S. launch. In addition to these commercial responsibilities, Mr. Durso oversaw a number of other functional areas in the organization, including corporate communications, business development, quality assurance, and medical affairs and pharmacovigilance. Mr. Durso also was the leader of the company-wide reorganization effort that took place following the receipt of the CRL from the FDA.

•

Mr. Kapadia: Mr. Kapadia was responsible for the oversight of all aspects of the Company’s financial management, as well as the investor relations, facilities, procurement, and information technology functions. In addition to his core duties, Mr. Kapadia played an important pre-launch role from the finance side in preparing for the potential launch of OCA for liver fibrosis due to NASH. He also co-led the Company’s pandemic response activities, and oversaw the completion of the transfer of our research and development activities to a new and upgraded site in the San Diego area.

•

Mr. Kim: Mr. Kim was responsible for the strong 2020 financial performance of Ocaliva for PBC in the United States, despite the impact of the ongoing COVID-19 global pandemic, and was also responsible for overseeing the Company’s launch preparations for OCA for liver fibrosis due to NASH, including detailed plans for access, payor engagement, and physician education. A key part of his 2020 objectives was designing and completing the staffing of an outstanding U.S. launch organization, with the Company attracting many talented professionals from across the biopharmaceutical industry. Mr. Kim also played an important role in reorganizing the Company following the receipt of the CRL.

•

Dr. Weyer: Dr. Weyer led all of the Company’s research and development activities, including clinical development, clinical operations, regulatory affairs, product development, and chemistry, manufacturing, and controls; new products and pipeline, and biostatistics and data management. In 2020 Dr. Weyer was responsible for leading the Company’s interactions with the FDA regarding the submission for approval of OCA for liver fibrosis due to NASH. Following receipt of the CRL from the FDA, Dr. Weyer continued to play an important role in the company’s interactions with the FDA.

~~Earlier in 2021, our Compensation Committee reviewed our 2020 performance against our corporate goals (as described above), and assessed the individual performance~~weight of each ~~named executive officer (other than our former Chief Executive Officer) employed with~~goal and each category, and adding the Company at that time (i.e., Mr. Durso, Mr. Kapadia, Mr. Kim, and Dr. Weyer) after considering such officer’s performance in light of his or her goals and individual contributions, and the recommendations of Mr. Durso, our Chief Executive Officer (except with regards to himself). The following table sets forth the 2020 cash incentive bonus targets, achievement levels, and payments for our named executive officers:results across categories.

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2020 Cash Incentive Bonus
Named Executive Officer
Target
(as % of
Base Salary)

Corporate
Goal
Achievement
Level

Individual
Goal
Achievement
Level

Aggregate
Achievement
(as % of
Base Salary)
Payment ($)
Mark Pruzanski, M.D. 70% N/A — N/A 531,995(1)
Jerome Durso 50% 70% 110% 39% 231,737
Sandip Kapadia 50% 70% 110% 39% 184,039
Richard Kim 50% 70% 105% 37% 168,056
Lisa Bright 50% — — — 240,955(2)
Ryan Sullivan 50% — — — —(3)
Christian Weyer, M.D., M.A.S. 50% 70% 100% 35% 170,804

Goal	Weight		Performance Score		Weighted Performance
Achieve PBC net sales of $332.5 million		50%		117.80%		29.45%
Achieve PBC commercial contribution of $102 million		15%		200.00%		15.00%
Complete enrollment for Study 213 by year-end		10%		44.40%		2.22%
Deliver first topline results from Study 123 by year-end		10%		0.00%		0.00%
Achieve regulatory alignment on post-marketing commitments for PBC by year-end		15%		100.00%		7.50%
PBC total		50%		108.34%		54.17%
Advance the delivery of the analyses necessary to support the decision-making process on OCA in NASH by year-end		60%		75.00%		18.00%
Achieve last patient visit in REVERSE/Study 304 by end Q3 2021		20%		100.00%		8.00%
Deliver topline safety and efficacy readout of REVERSE/Study 304 by year-end		20%		0.00%		0.00%
NASH total		40%		65.00%		26.00%
Strategy and pipeline goals including commencing first in human study of INT-787 by year-end		100%		100.00%		10.00%
Strategy and pipeline total		10%		100.00%		10.00%
Total		100%		90.17%		90.17%

In early 2022, the committee considered our performance in light of the above goals, and approved an overall score of 90.17%.

The bonus for our NEOs (other than our CEO) is based both on our corporate goals and on individual performance. For 2021, key individual responsibilities, goals, and achievements for our NEOs (other than our CEO) were as follows:

~~(1)~~•

~~Dr. Pruzanski was paid at~~Mr. Saik: As CFO, Mr. Saik is responsible for overseeing the ~~level~~Company’s finances, as well as investor relations, business development, facilities, and information technology. Notably, in 2021, Mr. Saik led our initiative to exchange a significant portion of ~~100%~~our debt for longer-dated debt, helping to decrease strategic uncertainty and improve the financial position of ~~target based on the terms of the Retirement and Consulting Agreement. See “Executive Compensation—Retirement and Consulting Agreement”.~~

~~(2)~~

~~Payment of the cash incentive bonus was based on the terms of the settlement agreement between the officer and~~ the Company.

~~(3)~~•

~~No cash incentive bonus~~Mr. Kapadia: Not applicable, due to separation from the Company before being evaluated.

•

Mr. Venezia: As interim CFO, Mr. Venezia managed our financial department during a management transition. As our Chief Accounting Officer, he has managed our accounting, financial reporting, tax, and treasury functions through management changes and multiple complex transactions.

•

Mr. Freedberg: As our General Counsel, Mr. Freedberg is responsible for the oversight of all aspects of our legal, corporate governance, intellectual property, and compliance functions. He has helped the Company navigate multiple complex litigations, as well as a debt financing and other complex matters.

•

Dr. Berrey: As our Chief Medical Officer and President of R&D, Dr. Berrey has led our ongoing research efforts on multiple fronts, including our PBC post-marketing requirements, ongoing clinical trials for NASH, evaluation of a fixed-dose combination product, and evaluation of other product candidates.

•

Dr. Cawkwell: As our SVP of Medical Affairs, Safety, and Pharmacovigilance, Dr. Cawkwell supports our pharmaceutical business, and is actively involved in supporting our existing commercial product and product pipeline. In particular, in 2021, she was ~~paid,~~important in the resolution of a newly identified safety signal, or “NISS”, resulting in an update to our Ocaliva prescribing information.

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RSUs or RSAs granted before 2019 vest over four years from the vesting commencement date, with 1/4 vesting after one year, and 1/16 (1/12 of the remainder) vesting quarterly thereafter for the following three years.

RSUs granted beginning in 2019 vest over four years from the vesting commencement ~~dates.~~date, with 1/4 vesting each year.

PSUs vest three years after the vesting commencement date, at levels from 0% to 150%, based on stock performance. See “Compensation Discussion and Analysis” above.

These vesting schedules are subject to continued employment.

(4)

For columns (g) and (h), RSU and RSA grant dates and vesting commencement dates are as follows.

Shares or Units

Grant Date

Vesting
Commencement
Date

(a)

02/~~01/17~~

~~01/01/17~~

~~(b)~~

~~02/23/17~~

~~(c)~~

~~11/27/17~~

~~(d)~~

~~02/~~05/18

01/01/18

~~(e)~~(b)

01/16/19

01/01/19

~~(f)~~(c)

01/23/20

01/01/20

(d)

01/22/21

01/01/21

(e)

06/21/21

(f)

09/01/20

(g)

02/01/21

(h)

06/14/21

(i)

02/12/18

~~(6)~~(5)

~~These TSR PSUs were granted on the following~~For columns (i) and (j), PSU grant dates ~~with the following~~and vesting commencement ~~dates.~~dates are as follows.

Shares or Units

Grant Date

Vesting
Commencement
Date

(a)

01/16/19

01/01/19

(b)

01/23/20

01/01/20

(c)

01/22/21

01/01/21

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~~(7)~~(6)

~~Dr. Pruzanski’s unexercisable options corresponding to 30,659 shares (column (c)), unvested~~The number of shares or units, and the corresponding ~~to 12,771 shares (column (g)), and equity incentive plan awards corresponding to 67,514 shares (column (i)), are scheduled to vest over twelve months. These figures exclude the first such~~value, assume vesting ~~which occurred on December 31, 2020. See “Executive Compensation—Retirement and Consulting Agreement”~~at our threshold performance level of 50%.

~~(8)~~

Per the terms of Ms. Bright’s service agreement, she shall have one year from departure to exercise vested options (or until the option’s expiration date, if shorter). Per the terms of Mr. Sullivan’s employment agreement, he shall have 90 days from departure to exercise vested options (or until the option’s expiration date, if shorter).

Table of Option Exercises and Stock Vested

The following table sets forth the number of shares and value realized by the ~~named executive officers~~NEOs during ~~2020~~2021 on the exercise of stock options and the vesting of ~~restricted stock units~~RSUs (or ~~restricted stock)~~RSAs).

Option Awards Stock Awards
Name
Number of
Shares
Acquired on
Exercise
(#)

Value Realized
on Exercise
($)

Number of
Shares
Acquired on
Vesting
(#)

Value Realized
on Vesting
($)(1)

Mark Pruzanski, M.D. — — 54,346 1,736,397
Jerome Durso — — 12,150 596,750
Sandip Kapadia — — 8,812 512,232
Richard Kim — — 5,102 251,635
Lisa Bright — — 5,062 283,113
Ryan Sullivan — — 5,800 390,775
Christian Weyer, M.D., M.A.S. — — 6,900 344,750

	Option Awards				Stock Awards
Name	Number of Shares Acquired on Exercise (#)		Value Realized on Exercise ($)		Number of Shares Acquired on Vesting (#)		Value Realized on Vesting ($)(1)
Jerome Durso		—		—		20,837		367,103
Andrew Saik		—		—		—		—
Sandip Kapadia		—		—		869		21,464
Rocco Venezia		—		—		3,441		56,157
Jared Freedberg		—		—		—		—
Michelle Berrey		—		—		—		—
Gail Cawkwell		—		—		8,981		163,418

(1)

The value realized on the vesting of ~~restricted stock units~~RSUs (or ~~restricted stock)~~RSAs) was calculated by multiplying the number of shares issued upon the vesting of ~~restricted stock units~~RSUs (or shares vesting, in the case of ~~restricted stock)~~RSAs) on the applicable vesting date by the closing market price of the shares on such date.

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Employment Arrangements with Our ~~Named Executive Officers~~NEOs

We have entered into individual agreements with ~~certain of~~ our executive officers, including ~~certain of~~ our ~~named executive officers.~~NEOs. In addition, the agreements governing equity awards granted to our employees, including our ~~named executive officers,~~NEOs, contain provisions relating to the treatment of such awards in the event of certain terminations. ~~On account~~

The material terms of ~~his departure from the Company, Dr. Pruzanski’s~~our NEOs’ employment agreements are summarized below. Mr. Kapadia had an employment agreement, dated as of May 14, 2013, has been superseded by his Retirement and Consulting Agreement dated as of December 9, 2020. Please see “Executive Compensation—Retirement and Consulting Agreement” below, including for retirement-related provisions specific to Dr. Pruzanski.

~~Mr. Durso’s employment agreement was amended and restated as of December 9, 2020, in connection with his promotion to President and Chief Executive Officer.~~

~~Mr. Kapadia, Mr. Kim, and Mr. Sullivan had employment agreements,~~ but ~~have departed from their employment with the Company. Their resignations were~~is no longer an employee. His resignation to pursue other opportunities ~~and~~ did not trigger the “termination without cause” or “resignation for good reason” provisions ~~described~~ below.

~~Ms. Bright had a service agreement dated as of October 7, 2016, and departed from her employment with the Company pursuant to a settlement agreement (described below).~~

~~Dr. Weyer has~~ Mr. Venezia entered into an employment agreement ~~dated~~ as of ~~November 2, 2017.~~April 21, 2022.

Summarized below are the material terms of the employment agreements of our named executive officers. (Dr. Pruzanski’s Retirement and Consulting Agreement, and Ms. Bright’s settlement agreement, superseded their respective employment and service agreements and are described separately.)

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See ~~“—Definitions”~~“Definitions” below for ~~the~~ meanings of certain ~~terms used in this section.~~terms.

Basic Terms

Each ~~of the~~NEO employment ~~agreements with our named executive officers~~agreement provides ~~for (i)~~ for:

(1)

an annual base salary, which is subject to annual review, as determined by our Board or Compensation Committee, ~~(ii)~~

(2)

eligibility for an annual target-based cash incentive bonus equal to a percentage of such officer’s base salary, and ~~(iii)~~

(3)

eligibility to participate in the Company’s benefit plans and ~~arrangements, in each case, as described in greater detail under “—Compensation Discussion and Analysis—Components~~arrangements.

Each NEO employment agreement has an initial one-year term (except Mr. Durso’s employment agreement has an initial two-year term of ~~Our Executive Compensation Program” above. Each of the employment agreements with our named executive officers have initial terms of one year~~from January 1, 2021, to January 1, 2023), with automatic renewal ~~each year~~annually thereafter, unless either party elects not to renew or earlier terminates the agreement, except that our amended and restated employment agreement with Mr. Durso has an initial term of two years, from January 1, 2021, to January 1, 2023, and thereafter renews for one-year terms.agreement.

Termination-Related Provisions

Termination for Any Reason

Upon any termination of employment, each ~~named executive officer~~NEO is entitled to receive accrued but unpaid salary (including payment of accrued but unused vacation days), such officer’s vested equity awards, and any other accrued benefits under the Company’s benefit plans or such officer’s employment agreement.

~~Under~~Except as described below, following termination, all unvested equity awards are forfeited and the NEO has 90 days (or one year, for Mr. ~~Durso’s amended and restated employment agreement,~~Durso), or the remaining term of the option if shorter, to exercise vested options.

For Mr. Durso, following termination, his target bonus for the prior year, ~~preceding the year in which the termination occurred, to the extent~~if earned ~~and~~but unpaid, would ~~also~~ be payable.

Except as described under “Termination Without Cause or Resignation for Good Reason”, “Termination Without Cause or Resignation for Good Reason in Connection with a Change in Control”, and “Termination in the Event of Death or Disability” below, all unvested equity awards held by the named executive officer would be forfeited and such officer would have 90 days (or, in the case of Mr. Durso, one year) (or the remaining term of the options if shorter) following termination to exercise any vested options.

Termination Without Cause or Resignation for Good Reason

~~With respect to the employment agreements that remained in effect at the end of 2020, in the event that~~If (a) the Company elects not to renew the employment agreement, ~~of a named executive officer, such~~(b) the officer is terminated by the Company without cause, or ~~such~~(c) the officer resigns for good ~~reason:~~reason, then:

(1)

~~such~~the officer ~~will be~~is entitled to receive:

(i)

the ~~same~~ benefits as described ~~under~~in “Termination for Any Reason” ~~above,~~,

(ii)

cash severance ~~in an amount~~ equal to 12 months of ~~such officer’s~~current base salary ~~in effect at the time of termination, payable~~(payable over 12 ~~months,~~months),

(iii)

continued health benefits ~~for~~(for up to 12 ~~months following termination,~~months),

(iv)

one year to exercise vested options (or the remaining term of the ~~options~~option if shorter) ~~following termination to exercise any vested options,~~,

(v)

~~for Mr. Durso, Mr. Kapadia, and Dr. Weyer only, the number~~vesting of unvested equity awards ~~held by each such officer~~ that would ~~otherwise~~ have vested ~~during the period from the date~~within one year of termination (or two years, for Mr. Durso) (with the proviso, for Mr. Saik, Mr. Venezia, Mr. Freedberg, and Dr. Berrey, that this relates to service-based equity awards, and that PSUs are governed by their award agreements, which generally provide for forfeiture of unvested awards as of the ~~first anniversary thereof (or,~~officer’s termination date),

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(vi)

a pro-rated annual cash incentive bonus, payable when such bonuses are paid to similarly situated employees, provided that the officer is employed for at least six months in the ~~case~~calendar year of ~~Mr. Durso, the second anniversary thereof) will vest,~~termination (for Dr. Cawkwell only), and

~~(vi)~~(vii)

~~for Mr. Durso only,~~ a lump sum payment equal to ~~his~~the officer’s target annual cash incentive ~~bonus.~~bonus (for Mr. Durso only).

(2)

~~following~~for RSUs that were granted in 2019 or thereafter, if termination occurs after the first anniversary of the vesting commencement date, ~~of restricted stock units that were granted in 2019 or thereafter, such restricted stock units~~the RSU shall ~~become vested~~vest as follows (the

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~~“2019~~ “2019 RSU Termination Vesting Schedule”) (unless superseded by the more generous vesting provision described immediately above):

~~(x)~~(i)

if the termination date is three months or less before the ~~restricted stock unit’s~~RSU’s next scheduled vesting date, 75% of the ~~restricted stock units~~RSUs that were scheduled to vest on such next vesting date shall become vested,

~~(y)~~(ii)

if the termination date is more than three months but no more than six months before the next scheduled vesting date, 50% of the ~~restricted stock units~~RSUs that were scheduled to vest on that vesting date shall become vested, and

~~(z)~~(iii)

if the termination date is more than six months but no more than nine months before the next scheduled vesting date, 25% of the ~~restricted stock units~~RSUs that were scheduled to vest on that vesting date shall become vested.

Termination Without Cause or Resignation for Good Reason in Connection with a Change in Control

~~In the event that~~If (a) the Company elects not to renew the employment agreement, ~~of a named executive officer, such~~(b) the officer is terminated by the Company without cause, or ~~such~~(c) the officer resigns for good reason, ~~in each case, in anticipation of or~~ within 12 months following a change in control ~~such~~(or also in anticipation of, and/or within 3 months before a change in control, for Mr. Durso; or also within 12 months in anticipation of a change in control, for Mr. Kapadia and Dr. Cawkwell), then the officer ~~will be~~is entitled to ~~receive~~ the same benefits as described ~~under “Termination Without Cause or Resignation for Good Reason” above, except that the cash severance amount will be payable~~ in a lump sum, all unvested equity awards held by such officer will vest, and such officer will have one year (or the remaining term of the options if shorter) following termination to exercise any vested options.

~~For Mr. Durso, instead of the corresponding amounts described above, under~~ “Termination Without Cause or Resignation for Good Reason”, ~~he will be entitled to receive under his amended and restated employment agreement:~~

except that (1)

the cash severance amount is payable in a lump sum, (2) all unvested equity awards will vest, and (3) the officer will have one year to exercise vested options (or the remaining term of the option if shorter).

For Mr. Durso only, the cash severance will instead be a lump sum equal to 24 months of ~~his~~ base salary,

~~(2)~~

~~continued~~ health benefits will instead continue for up to 24 months, ~~following termination,~~ and

~~(3)~~

a lump sum ~~payment~~will instead be payable equal to twice his target annual cash incentive bonus.

Termination in the Event of Death or Disability

In the event of termination ~~by reason of a named executive officer’s~~due to death or disability, ~~such officer will be~~the NEO is entitled to ~~receive~~ the same benefits as described ~~under~~in “Termination for Any Reason” ~~above,~~, except that:

~~(A)~~(1)

a prorated portion ~~(based on the number~~ of ~~days accrued in the current vesting period prior to the date of termination) of the~~ unvested options ~~held by such officer~~ that would otherwise have vested on the next vesting date will vest, based on the number of days in the current vesting period that have accrued, and ~~such~~the officer (or ~~such~~the officer’s estate or ~~legal representative, as applicable)~~representative) will have one year to exercise vested options (or the remaining term of the ~~options~~option if shorter) ~~following termination to exercise any vested options,~~,

~~(B)~~(2)

a prorated portion ~~(based~~of unvested PSUs will vest at the target level, based on the portion of the performance period that has elapsed, ~~as of the date of termination) of the target award amount of unvested TSR PSUs held by such officer will vest,~~ and

~~(C)~~(3)

~~except as described in the next sentence,~~ all remaining unvested equity awards ~~held by such officer would~~will be ~~forfeited.~~

~~In the event of a~~forfeited, except for RSUs that were granted in 2019 or thereafter, if termination ~~due to death or disability that~~ occurs ~~following~~after the first anniversary of the vesting commencement date, ~~of restricted stock units that were granted in 2019 or thereafter, such restricted stock units~~the RSU shall ~~become vested~~vest pursuant to the 2019 RSU Termination Vesting Schedule.

Release of Claims

Eligibility for the severance payments and benefits described above is conditioned upon the execution by the ~~named executive~~ officer (or ~~such~~the officer’s ~~legal~~ representative, asif applicable), and effectiveness, within a specified period of time following termination, of a general release of claims in favor of the Company.

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Certain Code-Related Provisions

If any amounts owed to ~~a named executive officer~~an NEO as a result of a termination in connection with a change in control of the Company would be subject to the excise tax imposed by Section 4999 of the Code, then such amounts will be payable either (i) in full, or (ii) solely to the extent that the after-tax value of such amounts to such officer would be greater as a result of such reduction, as to such reduced amount that would maximize the after-tax value of such amounts to such officer.

In addition, the timing of payments may be modified by us to comply with Section 409A of the Code.

Treatment of ~~TSR~~ PSUs in the Event of a Change in Control

With respect to ~~TSR~~ PSUs, in the event of a change in control, the performance period shall end, and such ~~TSR~~ PSUs shall vest, if at all, based on our TSR performance relative to ~~that of~~ our TSR Peer Group through the month preceding the month in which the change in control occurs. The percentage of such TSR PSUs that may vest ranges from 0% to 150%, as more fully described under “—Compensation Discussion and Analysis—Components of Our Executive Compensation Program—Equity Incentive Awards—Annual Equity Awards” above.

Definitions

Under the employment agreements with our ~~named executive officers:~~NEOs:

•

“cause” generally means:

(i)

that the officer has engaged in material dishonesty, willful misconduct, or gross negligence, or has materially breached the employment agreement, and has failed to cure such conduct or breach within 30 days after receipt of written notice from us, or

(ii)

the officer’s conviction or entry of nolo contendere to any crime involving moral turpitude, fraud, or embezzlement, or any felony;

•

“change in control” generally means:

(i)

any sale, lease, exchange, or other transfer (in one transaction or a series of transactions) of all or substantially all of the assets of the Company,

(ii)

any consolidation or merger of the Company where the stockholders of the Company immediately prior to the consolidation or merger, would not, immediately after the consolidation or merger, beneficially own, directly or indirectly, shares representing in the aggregate more than 50% of the combined voting power of all the outstanding securities of the corporation issuing cash or securities in the consolidation or merger (or of its ultimate parent corporation, if any), or

(iii)

a third person (other than the Company, any employee benefit plan of the Company, or investors purchasing equity securities of the Company pursuant to a financing or a series of financings approved by our Board) becomes the beneficial owner, directly or indirectly, of securities representing 25% or more of the total number of votes that may be cast for the election of the directors of the Company; and

•

“good reason” generally means a material:

(i)

change in the officer’s duties, position, responsibilities, or reporting requirements,

(ii)

relocation more than 50 miles away from both the officer’s home and the Company’s prior office for the officer, or

(iii)

breach of the employment agreement by us,

in each case without the officer’s consent and subject to the officer giving us sufficient notice and time to cure the event giving rise to such good reason.

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~~Settlement Agreement~~

Ms. Bright had a service agreement dated as of October 7, 2016. She ceased to serve as an executive officer in 2020, and departed from her employment with the Company pursuant to a settlement agreement pursuant to which her last day for payroll purposes was January 1, 2021. Pursuant to the settlement agreement, Ms. Bright’s time-based unvested stock options and other time-based equity awards that would otherwise have vested from the effective date of her termination up to and including January 1, 2022, vested as of January 1, 2021. That totaled 5,375 stock options and 3,400 restricted shares and RSUs, which based on our stock price of $45.49 on September 3, 2020, were worth $38,517 (based on a Black-Scholes model with an option expiration date of the earlier of the original option expiration date and January 1, 2022) and $154,666 respectively. Ms. Bright has until the earlier of the expiration date of the option or January 1, 2022, to exercise all vested options. The settlement agreement provides for Ms. Bright to be paid £639,482, for a notice period, severance, bonus, and other amounts (equal to $876,794 based on an exchange rate of 1.3711 dollars to the pound as of December 31, 2020). This includes £175,738 for a bonus for 2020 (equal to $240,955 at the same exchange rate, as shown in the Summary Compensation Table). The settlement agreement also provides for payment by the Company of £10,000 in pension contributions for Ms. Bright (equal to $13,711). The settlement agreement further provides that the Company will pay to Ms. Bright by January 15, 2022, a cash payment equal to the pro-rated value of the shares (if any) that would have been issued to Ms. Bright upon the vesting of the PSUs granted in 2019 had Ms. Bright remained employed by the Company on December 31, 2021. Such pro-rated value shall be calculated based on the portion of the time that Ms. Bright was employed by the Company during the three-year period from January 1, 2019, to December 31, 2021. If such 2,600 PSUs vested at 50% of target in light of our TSR performance relative to that of our TSR Peer Group, based on the closing market price of our shares on December 31, 2020, of $24.70, and pro-rating by 2/3 to reflect employment for 2019 and 2020 but not 2021, they would have a value of $21,406.67. The Company also agrees to continue to provide Ms. Bright with private medical insurance and dental insurance until December 31, 2021, with an approximate annual value of $5,608. The settlement agreement also provides that the Company will pay Ms. Bright’s legal expenses in connection with termination of employment and in connection with the settlement agreement, in the amount of £6,500 plus value-added tax of 20%, or £7,800 (equal to $10,695).

Confidential Information and Assignment of Inventions Agreements

Each of our ~~named executive officers~~NEOs has entered into an agreement with us with respect to proprietary information and inventions. Among other things, these agreements obligate each ~~named executive officer~~NEO to refrain from disclosing any of our proprietary information received during the course of employment or soliciting our employees, and to assign to us any inventions conceived or developed during the course of employment.

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Potential Payments and Benefits Upon Termination of Employment or Change in Control

As described ~~under “—Employment Arrangements with Our Named Executive Officers”~~ above, we have entered into ~~certain individual~~employment agreements with ~~named executive officers~~certain NEOs providing for severance payments and benefits in the event of certain terminations of employment, including ~~in connection with~~ a change in control. In addition, ~~the~~our equity award agreements ~~governing equity awards granted to~~with our employees, including our ~~named executive officers,~~NEOs, contain ~~provisions relating to the treatment of such awards in the event of certain terminations or a~~termination and change in ~~control.~~control provisions. The following table ~~sets forth~~provides estimates of ~~the~~ payments and benefits that each ~~named executive officer~~NEO would have been entitled to ~~receive from the Company~~ upon a termination ~~of employment under the circumstances described in the table effective~~at December 31, ~~2020.~~2021.

The amounts included in respect of ~~TSR~~ PSUs following a change in control would be payable whether or not the ~~named executive officer’s~~NEO’s employment was terminated. Per Instruction 1 to Item 402(j) of Reg S-K, ~~such~~ amounts shown below ~~are shown assuming that~~assume a change in control ~~took place~~ on December 31, ~~2020,~~2021, when our closing stock price ~~per share~~ was ~~$24.70.~~$16.29. Accordingly, based on our TSR in absolute terms and relative to our TSR Peer Group, no ~~TSR~~ PSU vesting on a change in control is ~~assumed. See “—Employment~~assumed for our PSUs granted in 2020. For our PSUs granted in 2021, our stock price performance of -46.76% compared to our peer group put us in the 33rd percentile, resulting in an interpolated 65.41% payout.

Mr. Kapadia is not shown below, on account of leaving before December 31, 2021. He did not receive severance payments or benefits. Mr. Venezia is shown below without reference to his employment agreement, just the terms of the equity award agreements, because he did not have an employment agreement in place until 2022. Please refer to “Employment Arrangements with Our ~~Named Executive Officers—Treatment~~NEOs” for explanations of ~~TSR PSUs in the Event~~payment and benefit levels, and descriptions of ~~a Change in Control”.~~

~~As described below under “Executive Compensation—Retirement~~circumstances that trigger payments and ~~Consulting Agreement”, Dr. Pruzanski retired from the Company effective January 1, 2021, pursuant to a Retirement and~~benefits.

	Termination Due to Death or Disability ($)		Termination Without Cause or Resignation for Good Reason ($)		Termination Without Cause or Resignation for Good Reason in Connection with a Change in Control ($)
Jerome Durso
Cash Payments(1)		483,525		1,174,275		2,348,550
Value of Accelerated Vesting(2)		1,220,121		790,065		1,875,748
Health Insurance Benefits(3)		—		36,635		73,270
Total		1,703,646		2,000,975		4,297,568
Andrew Saik
Cash Payments		—		475,000		475,000
Value of Accelerated Vesting		—		360,547		849,621
Health Insurance Benefits		—		36,635		36,635
Total		—		872,182		1,361,256
Rocco Venezia
Cash Payments		—		—		—
Value of Accelerated Vesting		—		64,460		86,565
Health Insurance Benefits		—		—		—
Total		—		64,460		86,565
Jared Freedberg
Cash Payments		—		461,600		461,600
Value of Accelerated Vesting		—		357,500		721,272
Health Insurance Benefits		—		36,635		36,635
Total		—		855,736		1,219,508
Michelle Berrey
Cash Payments		—		600,000		600,000
Value of Accelerated Vesting		—		451,950		1,093,352
Health Insurance Benefits		—		32,682		32,682
Total		—		1,084,631		1,726,034

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~~Consulting Agreement dated as of December 9, 2020. Rather than in the table below, his retirement payments and benefits are described in that section.~~

~~The table below reflects Mr. Durso’s amended and restated employment agreement dated as of December 9, 2020.~~

Ms. Bright and Mr. Sullivan are not represented below on account of their departures prior to December 31, 2020. For information regarding Ms. Bright’s payments and benefits in the nature of severance in connection with her departure, see “Employment Arrangements with Our Named Executive Officers—Settlement Agreement”. Mr. Sullivan did not receive payments or benefits in the nature of severance in connection with his departure.

In accordance with SEC rules, the potential payments were determined under the terms of the Company’s contracts, agreements, plans, and arrangements as in effect on December 31, 2020. The tables do not include any previously vested equity awards or accrued benefits. Because the payments to be made to a named executive officer depend on several factors, the actual amounts to be paid out upon a triggering event can only be determined at the time of the triggering event.

Name		Termination Due to Death ($)(4)	Termination Due to Disability ($)(5)	Termination Without Cause or Resignation for Good Reason ($)(6)	Termination Without Cause or Resignation for Good Reason in Connection with a Change in Control ($)(7)
Jerome Durso
	Cash Payments(1)	300,956	300,956	902,869	1,805,738	Termination Due to Death or Disability ($)		Termination Without Cause or Resignation for Good Reason ($)		Termination Without Cause or Resignation for Good Reason in Connection with a Change in Control ($)
Gail Cawkwell
Cash Payments							—		719,925		719,925
Value of Accelerated Vesting							218,286		111,994		327,778
Health Insurance Benefits							—		36,635		36,635
Total							218,286		868,554		1,084,338
	Value of Accelerated Vesting(2)	290,225	290,225	351,975	440,574
	Health Insurance Benefits(3)	—	—	35,649	71,298
	Total	591,181	591,181	1,290,493	2,317,609
Sandip Kapadia
	Cash Payments(1)	—	—	478,023	478,023
	Value of Accelerated Vesting(2)	144,495	144,495	104,975	223,387
	Health Insurance Benefits(3)	—	—	35,649	35,649
	Total	144,495	144,495	618,647	737,059
Richard Kim
	Cash Payments(1)	—	—	457,294	457,294
	Value of Accelerated Vesting(2)	132,145	132,145	—	201,478
	Health Insurance Benefits(3)	—	—	35,649	35,649
	Total	132,145	132,145	492,943	694,421
Christian Weyer, M.D., M.A.S.
	Cash Payments(1)	—	—	488,011	488,011
	Value of Accelerated Vesting(2)	130,910	130,910	68,543	258,905
	Health Insurance Benefits(3)	—	—	35,649	35,649
	Total	130,910	130,910	592,203	782,565

For each NEO:

(1)

Includes cash severance payments calculated based on base salary in effect on December 31, ~~2020.~~2021.

(2)

The value realized upon ~~the~~ accelerated vesting of is:

(i)

for stock options, is calculated by multiplying the number of “in-the-money” options subject to accelerated vesting by the difference between ~~the~~our closing ~~market~~stock price ~~of the shares~~ on December 31, ~~2020,~~2021, and the weighted-average exercise price of such options, and

(ii) ~~restricted stock is~~

for RSAs, RSUs, and PSUs, calculated by multiplying the number of shares ~~of restricted stock~~or units subject to accelerated vesting by ~~the~~our closing ~~market~~stock price ~~of the shares~~ on December 31, 2020, and (iii) restricted stock units and TSR PSUs is calculated by multiplying the number of restricted stock units and TSR PSUs subject to accelerated vesting by the closing market price of the shares on December 31, 2020. The closing market price of the shares on December 31, 2020, was $24.70.2021.

(3)

Represents the estimated cost to the Company of continuing health insurance benefits for the ~~named executive officers.~~NEOs.

~~(4)~~

~~See “—Employment Arrangements with Our Named Executive Officers—Termination-Related Provisions—~~~~Termination in the Event of Death or Disability” above for a description of the circumstances that would trigger the payment of amounts set forth in this column.~~

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~~(5)~~

~~(6)~~

~~See “—Employment Arrangements with Our Named Executive Officers—Termination-Related Provisions—~~~~Termination Without Cause or Resignation for Good Reason” above for a description of the circumstances that would trigger the payment of amounts set forth in this column.~~

~~(7)~~

See “—Employment Arrangements with Our Named Executive Officers—Termination-Related Provisions—Termination Without Cause or Resignation for Good Reason in Connection with a Change in Control” and “—Employment Arrangements with Our Named Executive Officers—Treatment of TSR PSUs in the Event of a Change in Control” above for a description of the circumstances that would trigger the payment of amounts set forth in this column.

Equity Compensation Plan Information

The following table provides information as of December 31, ~~2020,~~2021, with respect to shares that may be issued under our equity compensation plans.

Plan Category

Number of Securities
to be Issued Upon
Exercise of
Outstanding Options,
Warrants, and Rights

Weighted-Average
Exercise Price of
Outstanding Options,
Warrants, and Rights

Number of Securities
Remaining Available for
Future Issuance

Equity Compensation Plans Approved by Security Holders(1)

~~2,997,685~~3,306,910(2)

~~96.92~~50.28(3)

~~3,342,486~~3,471,706(4)

Equity Compensation Plans Not Approved by
Security Holders

—

(1)

All of our equity compensation plans have been approved by security ~~holders. Our equity compensation plans~~holders, and are described ~~in “Stock Compensation”, Note 13 to the Notes to Consolidated Financial Statements for the year ended December 31, 2020, included~~ in our Annual Report.

(2)

~~Consists of 2,198,994 shares issuable upon the exercise of~~Includes stock options, ~~outstanding under the 2012 Plan or our 2003 Stock Incentive Plan (the “2003 Plan”), as well as 29,376~~restricted shares, ~~of restricted stock (including performance restricted shares)~~RSUs, and ~~769,315 restricted stock units (including performance restricted stock units) outstanding under the 2012 Plan.~~PSUs. PSUs are counted for this purpose at maximum (150%) vesting. At 100% PSU vesting, total securities to be issued would be 3,221,213.

(3)

~~Does not take into account outstanding~~Stock options only. Restricted shares, ~~of restricted stock (including performance restricted shares) or restricted stock units (including performance restricted stock units), which~~RSUs, and PSUs do not ~~require the payment of any~~have exercise ~~price in connection with the vesting thereof.~~prices and are therefore excluded.

(4)

~~As of December 31, 2020, there were 3,342,486 shares~~PSUs are counted for this purpose at maximum (150%) vesting. At 100% PSU vesting, total securities remaining available for future ~~grants under~~issuance would be 3,557,403.

Includes the effect of the “evergreen” provision in our 2012 ~~Plan. No shares are~~plan. Our proposed amended plan removes the evergreen provision. Accordingly, the last anticipated application of the evergreen is expected to be January 1, 2022. The evergreen provision provides for the automatic increase on January 1 of each year of the number of securities available for future ~~grants under the 2003 Plan. Shares underlying awards outstanding under the 2003 Plan that expire or are forfeited or cancelled become available for~~ issuance ~~under the 2012 Plan. The number of shares available for future grants under the 2012 Plan automatically increases on January 1st of each year until (and including) January 1, 2022,~~ by ~~an amount equal to~~ the lesser of (i) 1,211,533 shares, (ii) 4% of ~~the~~ total ~~number of~~ shares outstanding on ~~such~~that date, and (iii) an amount determined by our Board or Compensation Committee. ~~Accordingly, on January 1, 2021, the number of~~Also, shares underlying outstanding awards that expire or are forfeited or cancelled become available for future ~~grants increased by 1,211,533 shares.~~

issuance.

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~~Retirement and Consulting Agreement~~

~~On December 9, 2020, Dr. Pruzanski and the Company entered into a Retirement and Consulting Agreement that superseded Dr. Pruzanski’s existing employment agreement.~~

Pursuant to the agreement, effective January 1, 2021, Dr. Pruzanski, retired from his position as President and Chief Executive Officer. During the period commencing on January 1, 2021 (the “Transition Date”), and ending on such date following the first anniversary of the Transition Date as either party may determine (the “Consulting Period”), Dr. Pruzanski will continue to provide consulting services to the Company as a non-employee consultant, including (i) assisting the Company with the transition of Dr. Pruzanski’s duties to the Company’s new leadership team, (ii) assisting the Company’s executive team, its Board, and other senior Company personnel with respect to specific projects, and (iii) providing assistance with respect to any investigative, administrative, or regulatory proceeding as requested from time to time.

Pursuant to the agreement, Dr. Pruzanski will receive (i) a consulting fee of $118,200 per month, payable monthly in arrears (totaling $1,418,400 for the expected Consulting Period ending January 1, 2022), (ii) $531,995 in satisfaction of his rights with respect to an annual bonus for the 2020 calendar year, (iii) a reimbursement for all pre-approved reasonable business expenses incurred in connection with providing the services under the agreement during the Consulting Period, (iv) continued participation in the Company’s health and dental plans (with a cost to the Company of approximately $35,649 over twelve months), (v) reimbursement for attorney’s fees incurred in connection with entering into the agreement (up to a maximum of $50,000), and (vi) indemnification relating to work under the agreement, excluding willful acts and omissions, and gross negligence.

In addition, all outstanding and unvested Company equity awards held by Dr. Pruzanski as of December 9, 2020, and unvested as of January 1, 2021, will continue to vest in equal monthly installments over a period of twelve months commencing in December 2020, with any performance-based restricted stock units vesting at the maximum level of performance, subject to Dr. Pruzanski’s continued service on the Board or as a consultant. Performance-based restricted stock units scheduled to vest on December 31, 2020, vested on December 31, 2020, at the maximum level of performance.

With respect to stock options, Dr. Pruzanski will continue to have until the earlier of the expiration date of the option or three (3) years from the date of termination of his consulting and Board services to exercise all vested options (unless the stock plan pursuant to which the option is granted requires earlier termination in connection with a liquidation or sale of the Company).

~~The amounts attributable to these vesting arrangements pursuant to the Retirement and Consulting Agreement are as follows:~~

	~~Amount~~ ~~($)~~
~~Restricted stock and restricted stock units(1)~~		~~459,540~~
~~Performance restricted shares and TSR PSUs vesting on December 31, 2020(2)~~		~~1,168,830~~
~~12-month-vesting performance restricted shares and TSR PSUs(3)~~		~~2,452,545~~
~~Vesting of stock options(4)~~		~~316,476~~

~~(1)~~

This represents all of Dr. Pruzanski’s outstanding, unvested non-performance-based restricted stock and restricted stock units, as of December 31, 2020. These will vest over twelve months. Value is based on 13,800 shares and units, multiplied by our closing stock price of $33.30 on December 9, 2020.

~~(2)~~

This represents all of Dr. Pruzanski’s performance restricted shares and TSR PSUs scheduled to vest on December 31, 2020. These vested on December 31, 2020. Value is based on 23,400 shares and units, vesting at the maximum level of performance, or 150%, into 35,100 shares of common stock, multiplied by our closing stock price of $33.30 on December 9, 2020.

~~(3)~~

This represents all of Dr. Pruzanski’s outstanding, unvested performance restricted shares and TSR PSUs, as of December 31, 2020. These will vest over twelve months. Value is based on 49,100 shares and units, vesting at the maximum level of performance, or 150%, into 73,650 shares of common stock, multiplied by our closing stock price of $33.30 on December 9, 2020.

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~~(4)~~

This represents all of Dr. Pruzanski’s outstanding, unvested stock options, as of December 31, 2020. These will vest over twelve months. Value is based on 33,282 stock options, with their respective strike prices and original expiration dates, valued as of December 9, 2020, based on a Black-Scholes model and our stock price at the time of $33.30.

Both those unvested stock options, and his 247,703 stock options previously vested, for a total number of stock options exercisable into 280,985 shares of common stock, must be exercised by the earlier of the expiration date of the option or three (3) years from the date of termination of his consulting and Board services. Although the expected termination date of consulting services is January 1, 2022, Dr. Pruzanski remains a director, and the end date of his Board service is unknown. Accordingly, no deduction has been taken from the Black-Scholes valuation of his options on account of potential early expiration, in the case that three years from the date of termination of services is earlier than the expiration date of the options.

~~_______________________~~

If Dr. Pruzanski does not remain on our Board or as a consultant (including on account of death or disability), then monthly vesting of his remaining equity awards will cease, and remaining awards will be forfeited, unless such termination of services occurs with the consent of the Company, in which case all unvested equity awards shall vest upon the termination. If Dr. Pruzanski becomes employed with another employer during the period of his continued participation in our health and dental plans, then we will not be required to continue providing and paying for such health and dental benefits, if he becomes covered under a health insurance plan of the new employer. Dr. Pruzanski’s pre-existing agreements with the Company as to invention, non-disclosure, and non-solicitation remain in effect. See “Compensation Committee Report—Employment Arrangements with Our Named Executive Officers—Confidential Information and Assignment of Inventions Agreements” above. The Retirement and Consulting Agreement may be terminated by either party upon 30 days prior notice, effective at any time following January 1, 2022. Following such termination, Dr. Pruzanski shall only be entitled to earned and unpaid amounts of the consulting fee for periods prior to the effectiveness of such termination. In the event that Dr. Pruzanski becomes unable to provide consulting services due to death or disability prior to January 1, 2022, his consulting fee will continue to be payable through January 1, 2022. If Dr. Pruzanski dies, the compensation and benefits stated in the Retirement and Consulting Agreement will be paid to his beneficiary, or his estate if no beneficiary.

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Pay Ratio Disclosure

In accordance with the requirements of Section 953(b) of the Dodd-Frank Act and Item 402(u) of Regulation S-K (collectively, the “Pay Ratio Rule”), we are providing the following estimated information for ~~2020:~~2021:

•

the median of the annual total compensation of all of our employees (excluding our ~~Chief Executive Officer)~~CEO) was ~~$267,493;~~$216,748;

•

the annual total compensation of our ~~Chief Executive Officer~~CEO was ~~$6,427,005;~~$7,870,354; and

•

the ratio of these two amounts was approximately 2436.3 to 1. We believe that this ratio is a reasonable estimate calculated in a manner consistent with the requirements of the Pay Ratio Rule.

SEC rules for identifying the “median employee” and calculating annual total compensation allow companies to apply various methodologies and make various assumptions and, as result, the pay ratio reported by us may not be comparable to the pay ratio reported by other companies.

Methodology for Identifying Our Median Employee

Employee Population

To identify the median of the annual total compensation of all of our employees (excluding our ~~Chief Executive Officer)~~CEO), we first identified our total domestic and foreign employee population. We selected December 31, ~~2020,~~2021, as the date upon which we would identify our “median employee”. We determined that, as of December 31, ~~2020,~~2021, we had ~~497~~436 employees (excluding our ~~Chief Executive Officer)~~CEO). We did not make any adjustments to our employee population.

Determining our Median Employee

We identified our “median employee” from our total employee population for ~~2020~~2021 by applying the same methodology used for ~~2019.~~2020. Accordingly, we compared each employee’s aggregate ~~2020~~2021 base salary (annualized in the case of newly hired employees), cash incentive target, and equity award grant date fair value, in each case, converted into U.S. dollars as necessary. We identified our median employee using this compensation measure, which was consistently applied to all our employees included in the calculation.

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~~Related Person Transactions~~RELATED PERSON TRANSACTIONS

Limitation on Liability and Indemnification Matters

Our Restated Certificate of Incorporation and Restated Bylaws provide that we will indemnify our directors and officers, and may indemnify our employees and other agents, to the fullest extent permitted by law. Under ~~our Restated Certificate of Incorporation and/or Restated Bylaws,~~these organizational documents, we are also empowered to purchase insurance on behalf of, ~~our directors, officers, employees,~~ and ~~other agents, and to~~ enter into indemnification agreements with, our directors, officers, employees, and other agents. We have entered into indemnification agreements with directors and officers, which provide for indemnification for all reasonable expenses and liabilities incurred in connection with any action or proceeding brought against them in connection with their services. We believe that these arrangements are necessary to attract and retain qualified directors and officers and to allow them to exercise their judgment in the best interest of the Company and its stockholders. We have also obtained director and officer liability insurance as a risk management measure.

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Retirement and Consulting Agreement

On December 9, 2020, former CEO Dr. Mark Pruzanski and the Company entered into a Retirement and Consulting Agreement that superseded Dr. Pruzanski’s existing employment agreement.

Pursuant to the agreement, effective January 1, 2021, Dr. Pruzanski retired from his position as President and CEO. From January 1, 2021, to January 1, 2022 (the “Consulting Period”), Dr. Pruzanski continued to provide consulting services to the Company as a non-employee consultant, including (i) assisting the Company with the transition of Dr. Pruzanski’s duties to the Company’s new leadership team, (ii) assisting the Company’s executive team, its Board, and other senior Company personnel with respect to specific projects, and (iii) providing assistance with respect to any investigative, administrative, or regulatory proceeding as requested from time to time.

Pursuant to the agreement, Dr. Pruzanski received (i) a consulting fee of $118,200 per month, payable monthly in arrears (totaling $1,418,400 for twelve months), (ii) $531,995 in satisfaction of his rights with respect to an annual bonus for the 2020 calendar year, (iii) a reimbursement for all pre-approved reasonable business expenses incurred in connection with providing the services under the agreement during the Consulting Period, (iv) continued participation in the Company’s health and dental plans (with a cost to the Company of approximately $35,649 over twelve months), (v) reimbursement for attorney’s fees incurred in connection with entering into the agreement (up to a maximum of $50,000), and (vi) indemnification relating to work under the agreement, excluding willful acts and omissions, and gross negligence.

In addition, all outstanding and unvested Company equity awards held by Dr. Pruzanski as of December 9, 2020, and unvested as of January 1, 2021, continued to vest in equal monthly installments over a period of twelve months commencing in December 2020, with any PSUs vesting at the maximum level of performance, subject to Dr. Pruzanski’s continued service on the Board or as a consultant. PSUs scheduled to vest on December 31, 2020, vested on December 31, 2020, at the maximum level of performance.

With respect to stock options, Dr. Pruzanski continues to have until the earlier of the expiration date of the option or three (3) years from the date of termination of his consulting and Board services to exercise all vested options (unless the stock plan pursuant to which the option is granted requires earlier termination in connection with a liquidation or sale of the Company).

The amounts attributable to these vesting arrangements pursuant to the Retirement and Consulting Agreement are as follows:

	Amount ($)
RSAs and RSUs(1)		459,540
PSAs and PSUs vesting on December 31, 2020(2)		1,168,830
12-month-vesting PSAs and PSUs(3)		2,452,545
Vesting of stock options(4)		316,476

~~Audit Committee Report~~(1)

This represents all of Dr. Pruzanski’s outstanding, unvested non-performance-based RSAs and RSUs as of December 31, 2020. These vested over twelve months. Value is based on 13,800 shares and units, multiplied by our closing stock price of $33.30 on December 9, 2020.

(2)

This represents all of Dr. Pruzanski’s PSAs and PSUs scheduled to vest on December 31, 2020. These vested on December 31, 2020. Value is based on 23,400 shares and units, vesting at the maximum level of performance, or 150%, into 35,100 shares of common stock, multiplied by our closing stock price of $33.30 on December 9, 2020.

(3)

This represents all of Dr. Pruzanski’s outstanding, unvested PSAs and PSUs as of December 31, 2020. These vested over twelve months. Value is based on 49,100 shares and units, vesting at the maximum level of performance, or 150%, into 73,650 shares of common stock, multiplied by our closing stock price of $33.30 on December 9, 2020.

(4)

This represents all of Dr. Pruzanski’s outstanding, unvested stock options as of December 31, 2020. These vested over twelve months. Value is based on 33,282 stock options, with their respective strike prices and original expiration dates valued as of December 9, 2020, based on a Black-Scholes model and our stock price at the time of $33.30.

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Both those unvested stock options, and his 247,703 stock options previously vested, for a total number of stock options exercisable into 280,985 shares of common stock, must be exercised by the earlier of the expiration date of the option or three (3) years from the date of termination of his consulting and Board services. The termination date of consulting services was January 1, 2022, but Dr. Pruzanski remains a director, and the end date of his Board service is unknown. Accordingly, no deduction has been taken from the Black-Scholes valuation of his options on account of potential early expiration, in the case that three years from the date of termination of services is earlier than the expiration date of the options.

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AUDIT COMMITTEE REPORT

The information contained in this report shall not be deemed to be “soliciting material”, “filed” with the SEC, or incorporated by reference into any filing under the Securities Act or the Exchange Act, or subject to the liabilities of Section 18 of the Exchange Act, except to the extent that the Company specifically incorporates it by reference into a document filed under the Securities Act or the Exchange Act.

The Audit Committee’s primary purpose is to act on behalf of the Board in fulfilling the Board’s oversight responsibilities with respect to the Company’s accounting and financial reporting practices, systems of internal control over financial reporting, and audit process, as well as the quality and integrity of the Company’s financial reports, the qualifications, independence, and performance of the Company’s independent registered public accounting firm, the performance of the Company’s internal audit function, and the Company’s processes for monitoring compliance with legal and regulatory requirements and the Company’s Global Code of Business Conduct. The Audit Committee operates under a written charter adopted by the Board, a current copy of which is available on the Company’s website at www.interceptpharma.com in the Investors & Media section under “Corporate Governance”.

The Audit Committee has:

•

reviewed and discussed the audited financial statements for the year ended December 31, ~~2020,~~2021, with the Company’s management;

•

discussed with the Company’s independent registered public accounting firm, KPMG LLP, the matters required to be discussed by the applicable requirements of the Public Company Accounting Oversight Board (“PCAOB”) and the SEC; and

•

received the written disclosures and the letter from KPMG LLP required by applicable requirements of the PCAOB regarding KPMG LLP’s communications with the Audit Committee concerning independence, and has discussed with KPMG LLP such firm’s independence.

Based on the foregoing review and discussions, the Audit Committee has recommended to the Board that the audited financial statements be included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2020.~~2021.

The Audit Committee is responsible for the appointment, retention, compensation, evaluation, and oversight of the Company’s independent registered public accounting firm. After reviewing the past services provided by, and performance of, KPMG LLP, the Audit Committee appointed KPMG LLP as the Company’s independent registered public accounting firm for the year ending December 31, ~~2021.~~2022. The Audit Committee recommends that the Company’s stockholders ratify such appointment at the Annual Meeting.

By the Audit Committee of the Board of Directors of Intercept Pharmaceuticals, Inc.,

Glenn Sblendorio, Chairperson
Daniel Bradbury
Gino Santini

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~~Independent Registered Public Accounting Firm~~INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Audit Committee has appointed KPMG LLP as the Company’s independent registered public accounting firm for the year ending December 31, ~~2021.~~2022. KPMG LLP has audited the Company’s financial statements since 2008.

Fees Paid to KPMG LLP

The following table sets forth the aggregate fees billed to the Company for ~~the years ended December 31,~~2021 and 2020 ~~and 2019~~ by KPMG LLP.

	Year Ended December 31,						Year Ended December
	2020			2019			31, 2021			2020
	(in thousands)						(in thousands)
Audit Fees		$	1,615		$	1,777		$	1,869		$	1,615
Audit-Related Fees			—			—			—			—
Tax Fees			124			146			134			124
All Other Fees			2			2			2			2
Total Fees		$	1,741		$	1,925		$	2,005		$	1,741

Audit fees include fees associated with the annual integrated audit of our financial statements and internal control over financial reporting, reviews of our interim financial information, the issuance of consents in connection with filings with the SEC, audit services provided in connection with statutory ~~audits,~~and regulatory filings or engagements, and KPMG LLP’s work in connection with our financing activities, including the issuance of comfort letters. Tax fees include fees associated with tax compliance services, preparation of federal and state income tax returns, preparation of sales tax returns, and certain other tax consulting services. All other fees consist of fees related to a subscription to KPMG LLP’s online accounting research and disclosure tools.

We did not incur any audit-related fees in ~~2020~~2021 or ~~2019.~~2020. All fees described above were approved by the Audit Committee.

The Audit Committee has determined that the provision of services rendered above is compatible with maintaining KPMG LLP’s independence.

Pre-Approval Policy and Procedures

The Audit Committee has adopted a policy and procedures for the pre-approval of audit and non-audit services rendered by the Company’s independent registered public accounting firm, KPMG LLP. On an annual basis, management submits to the Audit Committee for pre-approval specified services expected to be rendered by the Company’s independent registered public accounting firm in the defined categories of audit, audit-related, tax, and other services up to specified amounts. Prior to engagement, the Audit Committee pre-approves these services by category of service. In the event that circumstances arise where it may become necessary to engage the Company’s independent registered public accounting firm for additional services not contemplated in the original pre-approval, pre-approval may also be given on an individual, case-by-case basis before the Company’s independent registered public accounting firm is engaged to provide such services. The Audit Committee may delegate pre-approval authority to one or more of its members. The member or members to whom such authority is delegated must report any pre-approval decisions to the full Audit Committee at its next scheduled meeting.

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~~Stockholders’ Proposals~~STOCKHOLDERS’ PROPOSALS

~~Stockholder Proposals~~If you wish to bring a matter before an annual meeting, including a stockholder proposal or a board nominee, you may do so by following the procedures in our bylaws. If you do that, you must solicit your own proxies. To be timely, written notice must be delivered to Intercept Pharmaceuticals, Inc., 305 Madison Avenue, Morristown, NJ 07960, Attention: Corporate Secretary between 120 and 90 days before the ~~Proxy Statement~~anniversary of the 2022 Annual Meeting (May 25, 2023), i.e., between January 25, 2023 and February 24, 2023. However, if the date of the 2023 Annual Meeting is more than 30 days before or after the anniversary, then notice must be delivered between 120 days before the 2023 Annual Meeting and either (i) 90 days before the 2023 Annual Meeting or (ii) 10 days after we first announce the date of the 2023 Annual Meeting.

Additionally, Exchange Act Rule 14a-8 ~~under the Exchange Act~~ addresses when a company must include a stockholder’s proposal in its proxy statement and identify the proposal in its form of proxy card when the company holds an annual or special meeting of stockholders. Under Rule 14a-8, in order for your proposals to be considered for inclusion in the proxy statement and proxy card ~~relating to~~for the ~~2022~~2023 Annual Meeting, ~~of Stockholders (the “2022 Annual Meeting”),~~ your proposals must be sent to ~~Intercept Pharmaceuticals, Inc., 10 Hudson Yards, 37th Floor, New York, NY 10001, Attention: Corporate Secretary,~~the address above not less than 120 calendar days before the anniversary of the date on which the Company’s proxy statement was released to stockholders in connection with the ~~2021~~2022 Annual ~~Meeting~~Meeting. Therefore, based on a filing date of ~~Stockholders (the “2021 Annual Meeting”). Therefore,~~May 2, 2022, the deadline is expected to be ~~December 28, 2021,~~January 2, 2023, for the ~~2022~~2023 Annual Meeting. However, if the date of the ~~2022~~2023 Annual Meeting changes by more than 30 days from the anniversary of the ~~2021~~2022 Annual Meeting, the deadline is a reasonable time before we begin to print and send our proxy materials. We will notify you of any change in this deadline in a quarterly report on Form 10-Q or in another communication to you. Stockholder proposals must also be otherwise eligible for inclusion.

~~Stockholder Proposals and Nominations for Directors to Be Presented at Meetings~~

If you desire to bring a matter before an Annual Meeting of Stockholders outside the process of Rule 14a-8, you may do so by following the procedures set forth in the Company’s Restated Bylaws. To be timely, written notice must be delivered to Intercept Pharmaceuticals, Inc., 10 Hudson Yards, 37th Floor, New York, NY 10001, Attention: Corporate Secretary not less than 90 days nor more than 120 days prior to the first anniversary of the 2021 Annual Meeting; provided, however, that in the event that the date of the 2022 Annual Meeting is more than 30 days before or more than 30 days after such anniversary date, then for such notice to be timely it must be delivered to the Corporate Secretary not earlier than 120 days prior to the 2022 Annual Meeting and not later than the later of (i) 90 days prior to such annual meeting or (ii) 10 days following the date of the first public announcement of the scheduled date of the 2022 Annual Meeting. As a result, in the event that the 2022 Annual Meeting is held neither more than 30 days before nor more than 30 days after the first anniversary of the 2021 Annual Meeting (May 27, 2022), notice of nominations or other business submitted pursuant to the Company’s Restated Bylaws must be received no earlier than January 27, 2022, and no later than February 26, 2022. Any such notice to the Corporate Secretary must include all of the information specified in the Company’s Restated Bylaws.

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~~Expenses and Solicitation~~EXPENSES AND SOLICITATION

The ~~cost~~costs of solicitation will be borne by the Company, and in addition to directly soliciting stockholders by mail, the Company may request brokers, dealers, banks, trustees, or other nominees to solicit their customers who have shares of the Company registered in the name of the nominee, and, if so, will reimburse such brokers, dealers, banks, trustees, or other nominees for their reasonable out-of-pocket costs. Solicitation by officers and employees of the Company may also be made of some stockholders in person or by mail, email, or telephone, following the original solicitation. ~~The Company has retained Innisfree M&A Incorporated to assist in the solicitation of proxies for a fee of approximately $17,500, plus out-of-pocket expenses.~~

~~Householding~~HOUSEHOLDING

Our Annual Report, including our audited financial statements for the year ended December 31, ~~2020,~~2021, is being mailed to you along with this proxy statement. In order to reduce printing and postage costs, only one Annual Report and one proxy statement will be mailed to multiple stockholders sharing an address, unless the Company receives contrary instructions from one or more of the stockholders sharing an address. If your household has received only one Annual Report and one proxy statement and you wish to receive separate copies of these documents, we will promptly deliver a separate copy of such documents to any requesting stockholder who contacts our transfer agent, VStock Transfer, LLC, by telephone at 1-855-9VSTOCK or in writing to VStock Transfer, LLC, 18 Lafayette Place, Woodmere, NY 11598. If your household is receiving multiple copies of the Company’s annual reports or proxy statements, and you wish to request delivery of a single copy, you may send a written request to our transfer agent at that same address.

~~Other Business~~OTHER BUSINESS

Management does not know of any other matters to be brought before the Annual Meeting except those set forth in the notice thereof. If other business is properly presented for consideration at the Annual Meeting, it is intended that the proxies will be voted by the persons named therein in accordance with their judgment on such matters.

We will mail or email without charge, upon written request, a copy of our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2020,~~2021, including the consolidated financial statements, the list of exhibits, and any particular exhibit specifically requested. Requests should be sent to investors@interceptpharma.com, or to Intercept Pharmaceuticals, Inc., ~~10 Hudson Yards, 37th Floor, New York, NY 10001,~~305 Madison Avenue, Morristown, NJ 07960, Attention: Corporate Secretary. Or please visit www.sec.gov to obtain an online copy of our Annual Report.

~~By Order of the Board of Directors,~~BY ORDER OF THE BOARD OF DIRECTORS.

/s~~/ Mary~~ ~~J. Grendell~~Morristown, NJ
~~Mary J. Grendell~~
~~Secretary~~

~~New York, New York~~
~~April 27, 2021~~May 2, 2022

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Appendix: Amended and Restated Equity Incentive Plan

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Signature [PLEASE SIGN WITHIN BOX] Date Signature (Joint Owners) Date TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: KEEP THIS PORTION FOR YOUR RECORDS DETACH AND RETURN THIS PORTION ONLY THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! INTERCEPT PHARMACEUTICALS, INC. ~~D49153-P54574 2. FOR~~

AMENDED AND RESTATED EQUITY INCENTIVE PLAN

DEFINITIONS.

Unless otherwise specified or unless the approval of a one-time stock option exchange program for non-executive employees. 4. Voting on a non-binding, advisory basis, that the stockholder advisory vote on the compensation of the Company’s named executive officers should occur every ONE YEAR. 3. FOR the approval, on a non-binding, advisory basis, of the compensation of the Company’s named executive officers. 5. FOR the ratification of the appointment of KPMG LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2021. The Board recommends that you vote these shares as follows: NOTE: Such other business as may properly come before the meeting or any adjournment thereof. Nominees: 1. FOR the election, by separate resolutions, of each ofcontext otherwise requires, the following ~~eleven nominees to serve on~~terms, as used in this Intercept Pharmaceuticals, Inc. Amended and Restated Equity Incentive Plan, have the following meanings:

Administrator means the Board of Directors, unless it has delegated power to act on its behalf to the Committee, in which case the Administrator means the Committee.

Affiliate means a corporation which, for purposes of Section 424 of the Code, is a parent or subsidiary of the Company, direct or indirect.

Agreement means an agreement between the Company and a Participant delivered pursuant to the Plan and pertaining to a Stock Right, in such form as the Administrator shall approve (and shall also include a notice from the Company to a Participant in the event the Administrator determines to utilize a notice rather than an agreement).

Board of Directors means the Board of Directors of the Company.

Cause shall mean (i) engaging in (A) willful or gross misconduct or (B) willful or gross neglect; (ii) repeatedly failing to adhere to the directions of superiors or the Board of Directors or the written policies and practices of the Company, or any Affiliate thereof; (iii) the commission of a felony or a crime of moral turpitude, dishonesty, breach of trust or unethical business conduct, or any crime involving the Company, or any Affiliate thereof; (iv) fraud, misappropriation or embezzlement; (v) a material breach of the Participant’s employment, non-competition, non-solicitation, invention, non-disclosure or similar material agreement with the Company or any Affiliate thereof; (vi) acts or omissions constituting a material failure to perform substantially the duties assigned to the Participant after demand for substantial performance is delivered by the Company or any Affiliate specifically identifying the manner in which the Company or an Affiliate believes the Participant has not substantially performed such duties; (vii) any illegal act detrimental to the Company or its Affiliates; or (viii) repeated failure to devote substantially all of Participant’s business time and efforts to the Company or an Affiliate if required by Participant’s employment agreement; provided, however, that, if at any particular time the Participant is subject to an effective employment agreement with the Company or an Affiliate, then, in lieu of the foregoing definition, “Cause” shall at that time have such meaning as may be specified in such employment agreement. The determination of the Administrator as to the existence of Cause will be conclusive on the Participant and the Company.

Code means the United States Internal Revenue Code of 1986, as amended including any successor statute, regulation and guidance thereto.

Committee means the Compensation Committee of the Board of Directors (or such other committee of the Board of Directors to which the Board of Directors has delegated power to act under or pursuant to the provisions of the Plan).

Common Stock means shares of the Company’s common stock, $0.001 par value per share.

Company means Intercept Pharmaceuticals, Inc., a Delaware corporation and, except where the context otherwise requires, any successor thereto.

Consultant means any natural person who is an advisor or consultant that provides bona fide services to the Company or its Affiliates, provided that such services are not in connection with the offer or sale of securities in a capital raising transaction, and do not directly or indirectly promote or maintain a market for the Company’s or its Affiliates’ securities.

Disability or Disabled means permanent and total disability as defined in Section 22(e)(3) of the Code.

Employee means any employee of the Company or of an Affiliate (including, without limitation, an employee who is also serving as an officer or director of the Company or of an Affiliate), designated by the Administrator to be eligible to be granted one or more Stock Rights under the Plan.

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Exchange Act means the Securities Exchange Act of 1934, as amended.

Fair Market Value of a Share of Common Stock means the closing price on the applicable date of the Common Stock on the national securities exchange on which the Common Stock is traded (or, if such applicable date is not a trading day, the last market trading day prior to such date) or, if not traded on a national exchange, the last price of the Common Stock on the composite tape or other comparable reporting system for the trading day on the applicable date and if such applicable date is not a trading day, the last market trading day prior to such date (or, if not available or applicable, the average between the last bid and ask, or such other value as determined by the Administrator in good faith).

ISO means an option intended to qualify as an incentive stock option under Section 422 of the Code.

Non-Qualified Option means an option which is not intended to or does not qualify as an ISO.

Option means an ISO or Non-Qualified Option granted under the Plan.

Participant means an Employee, director or Consultant of the Company or an Affiliate to whom one or more Stock Rights are granted under the Plan. As used herein, “Participant” shall include Participant’s Survivors where the context requires.

Plan means this Intercept Pharmaceuticals, Inc. Amended and Restated Equity Incentive Plan.

Predecessor Plan means the Intercept Pharmaceuticals, Inc. 2012 Equity Incentive Plan prior to this amendment and restatement.

Repricing means, with respect to an Option or stock appreciation right, a reduction of the exercise or strike price of the award, including pursuant to a cancellation and regrant or a cash payment in cancellation of the award in an amount exceeding the positive spread in the award at the time of such cancellation, but not including an adjustment effected pursuant to the provisions of Paragraph 24.

Securities Act means the Securities Act of 1933, as amended.

Shares means shares of the Common Stock as to which Stock Rights have been or may be granted under the Plan or any shares of capital stock into which the Shares are changed or for which they are exchanged within the provisions of Paragraph 3 of the Plan. The Shares issued under the Plan may be authorized and unissued shares or shares held by the Company in its treasury, or both.

Stock-Based Award means a grant by the Company under the Plan of an equity award or an equity based award which is not an Option or a Stock Grant, such as a restricted stock unit award (RSU) or a performance restricted stock unit award (PSU).

Stock Grant means a grant by the Company of Shares under the Plan, such as a grant of restricted or unrestricted shares (RSAs) or performance restricted shares (PSAs).

Stock Right means a right to Shares or the value of Shares of the Company granted pursuant to the Plan—an ISO, a Non-Qualified Option, a Stock Grant or a Stock-Based Award.

Survivor means a deceased Participant’s legal representatives and/or any person or persons who acquired the Participant’s rights to a Stock Right by will or by the laws of descent and distribution.

PURPOSES OF THE PLAN.

The Plan is intended to encourage ownership of Shares by Employees and directors of and certain Consultants to the Company and its Affiliates in order to attract and retain such people, to induce them to work for the benefit of the Company or of an Affiliate and to provide additional incentive for them to promote the success of the Company or of an Affiliate. The Plan provides for the granting of ISOs, Non-Qualified Options, Stock Grants and Stock-Based Awards.

SHARES SUBJECT TO THE PLAN.

(a) The number of Shares which may be issued from time to time pursuant to this Plan shall be: (i) 3,862,008 shares of Common Stock (representing shares remaining available for issuance and not subject to outstanding awards under the Predecessor Plan as of April 1, 2022) (the “Remaining Shares”), minus (ii) any shares of Common Stock that are represented by awards granted under the Predecessor Plan

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between April 1, 2022, and May 25, 2022, plus (iii) any shares of Common Stock that are represented by awards granted under the Predecessor Plan, that are forfeited, expire or are cancelled without delivery of shares of Common Stock or which result in the forfeiture of shares of Common Stock back to the Company on or after April 1, 2022, or the equivalent of such number of Shares after the Administrator, in its sole discretion, has interpreted the effect of any stock split, stock dividend, combination, recapitalization or similar transaction in accordance with Paragraph 24 of this Plan; provided, however, that no more than 4,220,014 Shares (representing the number of shares underlying outstanding equity awards as of April 1, 2022) shall be added to the Plan pursuant to the foregoing clause (iii). No more shares than clause (i) minus clause (ii) above may be issued under the Plan pursuant to the exercise of ISOs issued thereunder (subject to adjustment as set forth in Paragraph 24).

(b) If an Option ceases to be “outstanding”, in whole or in part (other than by exercise), or if the Company shall reacquire (at not more than its original issuance price) any Shares issued pursuant to a Stock Grant or Stock-Based Award, or if any Stock Right expires or is forfeited, cancelled, or otherwise terminated or results in any Shares not being issued, the unissued or reacquired Shares which were subject to such Stock Right shall again be available for issuance from time to time pursuant to this Plan. Notwithstanding the foregoing, if a Stock Right is exercised, in whole or in part, by tender of Shares or if the Company or an Affiliate’s tax withholding obligation is satisfied by withholding Shares, the number of Shares deemed to have been issued under the Plan for purposes of the limitation set forth in Paragraph 3(a) above shall be the number of Shares that were subject to the Stock Right or portion thereof, and not the net number of Shares actually issued. However, in the case of ISOs, the foregoing provisions shall be subject to any limitations under the Code.

4. ADMINISTRATION OF THE PLAN.

The Administrator of the Plan will be the Board of Directors, except to the extent the Board of Directors delegates its authority to the Committee, in which case the Committee shall be the Administrator. Subject to the provisions of the Plan, the Administrator is authorized to:

(a) Interpret the provisions of the Plan and all Stock Rights and to make all rules and determinations which it deems necessary or advisable for the administration of the Plan;

(b) Determine which Employees, directors and Consultants shall be granted Stock Rights;

(d) Specify the terms and conditions upon which a Stock Right or Stock Rights may be granted;

(e) Amend any term or condition of any outstanding Stock Right (other than to effect a Repricing, which shall not be permitted), including, without limitation, accelerate the vesting schedule or extend the expiration date, provided that (i) such term or condition as amended is permitted by the Plan; (ii) any such amendment shall not impair the rights of a Participant under any Stock Right previously granted without such Participant’s consent or in the event of death of the Participant the Participant’s Survivors; and (iii) any such amendment shall be made only after the Administrator determines whether such amendment would cause any adverse tax consequences to the Participant, including, but not limited to, the annual vesting limitation contained in Section 422(d) of the Code and described in Paragraph 6(b)(iv) below with respect to ISOs and pursuant to Section 409A of the Code;

(f) Buy out for a payment in cash or Shares, a Stock Right previously granted and/or cancel any such Stock Right and grant in substitution therefor other Stock Rights, covering the same or a different number of Shares and having an exercise price or purchase price per share which may be lower or higher than the exercise price or purchase price of the cancelled Stock Right, based on such terms and conditions as the Administrator shall establish and the Participant shall accept, provided that such action does not constitute a Repricing; and

(g) Adopt any sub-plans applicable to residents of any specified jurisdiction as it deems necessary or appropriate in order to comply with or take advantage of any tax or other laws applicable to the Company, any Affiliate or to Participants or to otherwise facilitate the administration of the Plan, which sub-plans may include additional restrictions or conditions applicable to Stock Rights or Shares issuable pursuant to a Stock Right;

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provided, however, that all such interpretations, rules, determinations, terms and conditions shall be made and prescribed with the intention of not causing any adverse tax consequences under Section 409A of the Code and preserving the tax status under Section 422 of the Code of those Options which are designated as ISOs. Subject to the foregoing, the interpretation and construction by the Administrator of any provisions of the Plan or of any Stock Right granted under it shall be final, unless otherwise determined by the Board of Directors, if the Administrator is the Committee. In addition, if the Administrator is the Committee, the Board of Directors may take any action under the Plan that would otherwise be the responsibility of the Committee.

To the extent permitted under applicable law, the Board of Directors or the Committee may allocate all or any portion of its responsibilities and powers to any one or more of its members and may delegate all or any portion of its responsibilities and powers to any other person selected by it. The Board of Directors or the Committee may revoke any such allocation or delegation at any time. Notwithstanding the foregoing, only the Board of Directors or the Committee shall be authorized to grant a Stock Right to any director of the Company or to any “officer” of the Company as defined by Rule 16a-1 under the Exchange Act.

ELIGIBILITY FOR PARTICIPATION.

The Administrator will, in its sole discretion, name the Participants in the Plan; provided, however, that each Participant must be an Employee, director or Consultant of the Company or of an Affiliate at the time a Stock Right is granted. Notwithstanding the foregoing, the Administrator may authorize the grant of a Stock Right to a person not then an Employee, director or Consultant of the Company or of an Affiliate; provided, however, that the actual grant of such Stock Right shall be conditioned upon such person becoming eligible to become a Participant at or prior to the time of the execution of the Agreement evidencing such Stock Right (for example, in the case of grants to newly hired Employees). ISOs may be granted only to Employees who are deemed to be residents of the United States for tax purposes. Non-Qualified Options, Stock Grants and Stock-Based Awards may be granted to any Employee, director or Consultant of the Company or an Affiliate. The granting of any Stock Right to any individual shall neither entitle that individual to, nor disqualify him or her from, participation in any other grant of Stock Rights or any grant under any other benefit plan established by the Company or any Affiliate for Employees, directors or Consultants.

TERMS AND CONDITIONS OF OPTIONS.

Each Option shall be set forth in writing in an Option Agreement, duly executed by the Company and, to the extent required by law or requested by the Company, by the Participant. The Administrator may provide that Options be granted subject to such terms and conditions, consistent with the terms and conditions specifically required under this Plan, as the Administrator may deem appropriate including, without limitation, subsequent approval by the shareholders of the Company of this Plan or any amendments thereto, and vesting and exercise conditions. The Option Agreements shall be subject to at least the following terms and conditions:

(a) Non-Qualified Options: Each Non-Qualified Option shall be subject to the terms and conditions which the Administrator determines to be appropriate and in the best interest of the Company, subject to the following minimum standards for any such Non-Qualified Option:

(i)

Exercise Price: Each Option Agreement shall state the exercise price (per share) of the Shares covered by each Option, which exercise price shall be determined by the Administrator and shall be at least equal to the Fair Market Value per share of Common Stock on the date of grant of the Option.

(ii)

Number of Shares: Each Option Agreement shall state the number of Shares to which it pertains.

(iii)

Option Periods: Each Option Agreement shall state the date or dates on which it first is exercisable and the date after which it may no longer be exercised, and may provide that the Option rights accrue or become exercisable in installments over a period of months or years, or upon the occurrence of certain conditions or the attainment of stated goals or events.

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(iv)

Option Conditions: Exercise of any Option may be conditioned upon the Participant’s execution of a Share purchase agreement in form satisfactory to the Administrator providing for certain protections for the Company and its other shareholders, including requirements that:

(A)

The Participant’s or the Participant’s Survivors’ right to sell or transfer the Shares may be restricted; and

(B)

The Participant or the Participant’s Survivors may be required to execute letters of investment intent and must also acknowledge that the Shares will bear legends noting any applicable restrictions.

(v)

Term of Option: Each Option shall terminate not more than ten years from the date of the grant or at such earlier time as the Option Agreement may provide.

(b) ISOs: Each Option intended to be an ISO shall be issued only to an Employee who is deemed to be a resident of the United States for tax purposes, and shall be subject to the following terms and conditions, with such additional restrictions or changes as the Administrator determines are appropriate but not in conflict with Section 422 of the Code and relevant regulations and rulings of the Internal Revenue Service:

(i)

Minimum standards: The ISO shall meet the minimum standards required of Non-Qualified Options, as described in Paragraph 6(a) above, except that clauses (i) and (v) thereunder are modified by this Paragraph 6(b).

(ii)

Exercise Price: Immediately before the ISO is granted, if the Participant owns, directly or by reason of the applicable attribution rules in Section 424(d) of the Code:

(A)

10% or less of the total combined voting power of all classes of stock of the Company or an Affiliate, the exercise price per share of the Shares covered by each ISO shall not be less than 100% of the Fair Market Value per share of the Common Stock on the date of grant of the Option; or

(B)

More than 10% of the total combined voting power of all classes of stock of the Company or an Affiliate, the exercise price per share of the Shares covered by each ISO shall not be less than 110% of the Fair Market Value per share of the Common Stock on the date of grant of the Option.

(iii)

Term of Option: For Participants who own:

(A)

10% or less of the total combined voting power of all classes of stock of the Company or an Affiliate, each ISO shall terminate not more than ten years from the date of the grant or at such earlier time as the Option Agreement may provide; or

(B)

More than 10% of the total combined voting power of all classes of stock of the Company or an Affiliate, each ISO shall terminate not more than five years from the date of the grant or at such earlier time as the Option Agreement may provide.

(iv)

Limitation on Yearly Exercise: The Option Agreements shall restrict the amount of ISOs which may become exercisable in any calendar year (under this or any other ISO plan of the Company or an Affiliate) so that the aggregate Fair Market Value (determined on the date each ISO is granted) of the stock with respect to which ISOs are exercisable for the first time by the Participant in any calendar year does not exceed $100,000.

TERMS AND CONDITIONS OF STOCK GRANTS.

Each Stock Grant to a Participant shall state the principal terms in an Agreement duly executed by the Company and, to the extent required by law or requested by the Company, by the Participant. The Agreement shall be in a form approved by the Administrator and shall contain terms and conditions which the Administrator determines to be appropriate and in the best interest of the Company, including any applicable vesting conditions, subject to the following minimum standards:

(a) Each Agreement shall state the purchase price per share, if any, of the Shares covered by each Stock Grant, which purchase price shall be determined by the Administrator but shall not be less than the minimum consideration required by the Delaware General Corporation Law, if any, on the date of the grant of the Stock Grant;

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(b) Each Agreement shall state the number of Shares to which the Stock Grant pertains; and

(c) Each Agreement shall include the terms of any right of the Company to restrict or reacquire the Shares subject to the Stock Grant, including the time and events upon which such rights shall accrue and the purchase price therefor, if any.

TERMS AND CONDITIONS OF OTHER STOCK-BASED AWARDS.

The Administrator shall have the right to grant other Stock-Based Awards based upon the Common Stock having such terms and conditions as the Administrator may determine, including, without limitation, the grant of Shares based upon certain conditions, the grant of securities convertible into Shares and the grant of stock appreciation rights, phantom stock awards or stock units. The principal terms of each Stock-Based Award shall be set forth in an Agreement, duly executed by the Company and, to the extent required by law or requested by the Company, by the Participant. The Agreement shall be in a form approved by the Administrator and shall contain terms and conditions which the Administrator determines to be appropriate and in the best interest of the Company, including any applicable vesting conditions.

The Company intends that the Plan and any Stock-Based Awards granted hereunder be exempt from or comply with the requirements of Section 409A of the Code, to the extent applicable, and be operated in accordance with Section 409A so that any compensation deferred under any Stock-Based Award (and applicable investment earnings) shall not be included in income under Section 409A of the Code. Any ambiguities in the Plan shall be construed to effect the intent as described in this Paragraph 8.

EXERCISE OF OPTIONS AND ISSUE OF SHARES.

An Option (or any part or installment thereof) shall be exercised by giving written notice to the Company or its designee (in a form acceptable to the Administrator, which may include electronic notice), together with provision for payment of the aggregate exercise price in accordance with this Paragraph for the Shares as to which the Option is being exercised, and upon compliance with any other condition(s) set forth in the Option Agreement. Such notice shall be signed by the person exercising the Option (which signature may be provided electronically in a form acceptable to the Administrator), shall state the number of Shares with respect to which the Option is being exercised and shall contain any representation required by the Plan or the Option Agreement. Payment of the exercise price for the Shares as to which such Option is being exercised shall be made (a) in United States dollars in cash or by check, or (b) at the discretion of the Administrator, through delivery of shares of Common Stock held for at least six months (if required to avoid negative accounting treatment) having a Fair Market Value equal as of the date of the exercise to the aggregate cash exercise price for the number of Shares as to which the Option is being exercised, or (c) at the discretion of the Administrator, by having the Company retain from the Shares otherwise issuable upon exercise of the Option, a number of Shares having a Fair Market Value equal as of the date of exercise to the aggregate exercise price for the number of Shares as to which the Option is being exercised, or (d) at the discretion of the Administrator, in accordance with a cashless exercise program established with a securities brokerage firm, and approved by the Administrator, or (e) at the discretion of the Administrator, by any combination of (a), (b), (c) and (d) above or (f) at the discretion of the Administrator, by payment of such other lawful consideration as the Administrator may determine. Notwithstanding the foregoing, the Administrator shall accept only such payment on exercise of an ISO as is permitted by Section 422 of the Code.

The Company shall then reasonably promptly deliver the Shares as to which such Option was exercised to the Participant (or to the Participant’s Survivors, as the case may be). In determining what constitutes “reasonably promptly,” it is expressly understood that the issuance and delivery of the Shares may be delayed by the Company in order to comply with any law or regulation (including, without limitation, state securities or “blue sky” laws) which requires the Company to take any action with respect to the Shares prior to their issuance. The Shares shall, upon delivery, be fully paid, non-assessable Shares.

10.

PAYMENT IN CONNECTION WITH THE ISSUANCE OF STOCK GRANTS AND STOCK-BASED AWARDS AND ISSUE OF SHARES.

Any Stock Grant or Stock-Based Award requiring payment of a purchase price for the Shares as to which such Stock Grant or Stock-Based Award is being granted shall be made (a) in United States dollars in cash or by check, or (b) at the discretion of the Administrator, through delivery of shares of Common

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Stock held for at least six months (if required to avoid negative accounting treatment) and having a Fair Market Value equal as of the date of payment to the purchase price of the Stock Grant or Stock-Based Award, or (c) at the discretion of the Administrator, by any combination of (a) and (b) above; or (d) at the discretion of the Administrator, by payment of such other lawful consideration as the Administrator may determine.

The Company shall when required by the applicable Agreement, reasonably promptly deliver the Shares as to which such Stock Grant or Stock-Based Award was made to the Participant (or to the Participant’s Survivors, as the case may be), subject to any escrow provision set forth in the applicable Agreement. In determining what constitutes “reasonably promptly,” it is expressly understood that the issuance and delivery of the Shares may be delayed by the Company in order to comply with any law or regulation (including, without limitation, state securities or “blue sky” laws) which requires the Company to take any action with respect to the Shares prior to their issuance.

11.

RIGHTS AS A SHAREHOLDER.

No Participant to whom a Stock Right has been granted shall have rights as a shareholder with respect to any Shares covered by such Stock Right except after due exercise of an Option or issuance of Shares as set forth in any Agreement, tender of the aggregate exercise or purchase price, if any, for the Shares being purchased and registration of the Shares in the Company’s share register in the name of the Participant.

12.

ASSIGNABILITY AND TRANSFERABILITY OF STOCK RIGHTS.

By its terms, a Stock Right granted to a Participant shall not be transferable by the Participant other than (i) by will or by the laws of descent and distribution, or (ii) as approved by the Administrator in its discretion (other than with respect to an ISO) and set forth in the applicable Agreement; provided that no Stock Right may be transferred by a Participant for value. The designation of a beneficiary of a Stock Right by a Participant, with the prior approval of the Administrator and in such form as the Administrator shall prescribe, shall not be deemed a transfer prohibited by this Paragraph. Except as provided above during the Participant’s lifetime a Stock Right shall only be exercisable by or issued to such Participant (or his or her legal representative) and shall not be assigned, pledged or hypothecated in any way (whether by operation of law or otherwise) and shall not be subject to execution, attachment or similar process. Any attempted transfer, assignment, pledge, hypothecation or other disposition of any Stock Right or of any rights granted thereunder contrary to the provisions of this Plan, or the levy of any attachment or similar process upon a Stock Right, shall be null and void.

13.

EFFECT ON OPTIONS OF TERMINATION OF SERVICE OTHER THAN FOR CAUSE OR DEATH OR DISABILITY.

Except as otherwise provided in a Participant’s Option Agreement, in the event of a termination of service (whether as an Employee, director or Consultant) with the Company or an Affiliate before the Participant has exercised an Option, the following rules apply:

(a) A Participant who ceases to be an Employee, director or Consultant of the Company or of an Affiliate (for any reason other than termination for Cause, Disability, or death for which events there are special rules in Paragraphs 14, 15, and 16, respectively), may exercise any Option granted to him or her to the extent that the Option is exercisable on the date of such termination of service, but only within such term as the Administrator has designated in a Participant’s Option Agreement.

(b) Except as provided in Subparagraph (c) below, or Paragraph 15 or 16, in no event may an Option intended to be an ISO, be exercised later than three months after the Participant’s termination of employment.

(c) The provisions of this Paragraph, and not the provisions of Paragraph 15 or 16, shall apply to a Participant who subsequently becomes Disabled or dies after the termination of employment, director status or consultancy; provided, however, in the case of a Participant’s Disability or death within three months after the termination of employment, director status or consultancy, the Participant or the Participant’s Survivors may exercise the Option within one year after the date of the Participant’s termination of service, but in no event after the date of expiration of the term of the Option.

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(d) Notwithstanding anything herein to the contrary, if subsequent to a Participant’s termination of employment, termination of director status or termination of consultancy, but prior to the exercise of an Option, the Administrator determines that, either prior or subsequent to the Participant’s termination, the Participant engaged in conduct which would constitute Cause, then such Participant shall forthwith cease to have any right to exercise any Option.

(e) A Participant to whom an Option has been granted under the Plan who is absent from the Company or an Affiliate because of temporary disability (any disability other than a Disability as defined in Paragraph 1 hereof), or who is on leave of absence for any purpose, shall not, during the period of any such absence, be deemed, by virtue of such absence alone, to have terminated such Participant’s employment, director status or consultancy with the Company or with an Affiliate, except as the Administrator may otherwise expressly provide; provided, however, that, for ISOs, any leave of absence granted by the Administrator of greater than ninety days, unless pursuant to a contract or statute that guarantees the right to reemployment, shall cause such ISO to become a Non-Qualified Option on the 181st day following such leave of absence.

(f) Except as required by law or as set forth in a Participant’s Option Agreement, Options granted under the Plan shall not be affected by any change of a Participant’s status within or among the Company and any Affiliates, so long as the Participant continues to be an Employee, director or Consultant of the Company or any Affiliate.

14.

EFFECT ON OPTIONS OF TERMINATION OF SERVICE FOR CAUSE.

Except as otherwise provided in a Participant’s Option Agreement, the following rules apply if the Participant’s service (whether as an Employee, director or Consultant) with the Company or an Affiliate is terminated for Cause prior to the time that all his or her outstanding Options have been exercised:

(a) All outstanding and unexercised Options as of the time the Participant is notified his or her service is terminated for Cause will immediately be forfeited.

(b) Cause is not limited to events which have occurred prior to a Participant’s termination of service, nor is it necessary that the Administrator’s finding of Cause occur prior to termination. If the Administrator determines, subsequent to a Participant’s termination of service but prior to the exercise of an Option, that either prior or subsequent to the Participant’s termination the Participant engaged in conduct which would constitute Cause, then the right to exercise any Option is forfeited.

15.

EFFECT ON OPTIONS OF TERMINATION OF SERVICE FOR DISABILITY.

Except as otherwise provided in a Participant’s Option Agreement:

(a) A Participant who ceases to be an Employee, director or Consultant of the Company or of an Affiliate by reason of Disability may exercise any Option granted to such Participant:

(i)

To the extent that the Option has become exercisable but has not been exercised on the date of the Participant’s termination of service due to Disability; and

(ii)

In the event rights to exercise the Option accrue periodically, to the extent of a pro rata portion of the vesting period through the date of Disability.

(b) A Disabled Participant may exercise the Option only within the period ending one year after the date of the Participant’s termination of service due to Disability, notwithstanding that the Participant might have been able to exercise the Option as to some or all of the Shares on a later date if the Participant had not been terminated due to Disability and had continued to be an Employee, director or Consultant or, if earlier, within the originally prescribed term of the Option.

(c) The Administrator shall make the determination both of whether Disability has occurred and the date of its occurrence (unless a procedure for such determination is set forth in another agreement between the Company and such Participant, in which case such procedure shall be used for such determination). If requested, the Participant shall be examined by a physician selected or approved by the Administrator, the cost of which examination shall be paid for by the Company.

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16.

EFFECT ON OPTIONS OF DEATH WHILE AN EMPLOYEE, DIRECTOR OR CONSULTANT.

Except as otherwise provided in a Participant’s Option Agreement:

(a) In the event of the death of a Participant while the Participant is an Employee, director or Consultant of the Company or of an Affiliate, such Option may be exercised by the Participant’s Survivors:

(i)

To the extent that the Option has become exercisable but has not been exercised on the date of death; and

(ii)

In the event rights to exercise the Option accrue periodically, to the extent of a pro rata portion of the elapsed vesting period through the date of death.

(b) If the Participant’s Survivors wish to exercise the Option, they must take all necessary steps to exercise the Option within one year after the date of death of such Participant, notwithstanding that the decedent might have been able to exercise the Option as to some or all of the Shares on a later date if he or she had not died and had continued to be an Employee, director or Consultant or, if earlier, within the originally prescribed term of the Option.

17.

EFFECT OF TERMINATION OF SERVICE ON STOCK GRANTS AND STOCK-BASED AWARDS.

In the event of a termination of service (whether as an Employee, director or Consultant) with the Company or an Affiliate for any reason before the Participant has accepted a Stock Grant or a Stock-Based Award and paid the purchase price, if required, such grant shall terminate.

For purposes of this Paragraph 17 and Paragraph 18 below, a Participant to whom a Stock Grant has been issued under the Plan who is absent from work with the Company or with an Affiliate because of temporary disability (any disability other than a Disability as defined in Paragraph 1 hereof), or who is on leave of absence for any purpose, shall not, during the period of any such absence, be deemed, by virtue of such absence alone, to have terminated such Participant’s employment, director status or consultancy with the Company or with an Affiliate, except as the Administrator may otherwise expressly provide.

In addition, for purposes of this Paragraph 17 and Paragraph 18 below, any change of employment or other service within or among the Company and any Affiliates shall not be treated as a termination of employment, director status or consultancy so long as the Participant continues to be an Employee, director or Consultant of the Company or any Affiliate.

18.

EFFECT ON STOCK GRANTS OF TERMINATION OF SERVICE OTHER THAN FOR CAUSE OR DEATH OR DISABILITY.

Except as otherwise provided in a Participant’s Stock Grant Agreement, in the event of a termination of service (whether as an Employee, director or Consultant), other than termination for Cause, Disability, or death for which events there are special rules in Paragraphs 19, 20, and 21, respectively, before all forfeiture provisions or Company rights of repurchase shall have lapsed, then such forfeiture or repurchase provisions shall apply.

19.

EFFECT ON STOCK GRANTS OF TERMINATION OF SERVICE FOR CAUSE.

Except as otherwise provided in a Participant’s Stock Grant Agreement, the following rules apply if the Participant’s service (whether as an Employee, director or Consultant) with the Company or an Affiliate is terminated for Cause:

(a) All Shares subject to any Stock Grant whether or not then subject to forfeiture or repurchase shall be immediately forfeited or repurchased, as the case may be.

(b) Cause is not limited to events which have occurred prior to a Participant’s termination of service, nor is it necessary that the Administrator’s finding of Cause occur prior to termination. If the Administrator determines, subsequent to a Participant’s termination of service, that either prior or subsequent to the Participant’s termination the Participant engaged in conduct which would constitute Cause, then all Shares subject to any Stock Grant that remained subject to forfeiture provisions or as to which the Company had a repurchase right on the date of termination shall be immediately forfeited to the Company.

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20.

EFFECT ON STOCK GRANTS OF TERMINATION OF SERVICE FOR DISABILITY.

Except as otherwise provided in a Participant’s Stock Grant Agreement, the following rules apply if a Participant ceases to be an Employee, director or Consultant of the Company or of an Affiliate by reason of Disability: to the extent the forfeiture provisions or the Company’s rights of repurchase have not lapsed on the date of Disability such forfeiture provisions or rights of repurchase shall lapse to the extent of a pro rata portion of the Shares subject to such Stock Grant through the date of Disability with such proration being based upon the portion of the applicable vesting period prior to the date of Disability.

The Administrator shall make the determination both as to whether Disability has occurred and the date of its occurrence (unless a procedure for such determination is set forth in another agreement between the Company and such Participant, in which case such procedure shall be used for such determination). If requested, the Participant shall be examined by a physician selected or approved by the Administrator, the cost of which examination shall be paid for by the Company.

21.

EFFECT ON STOCK GRANTS OF DEATH WHILE AN EMPLOYEE, DIRECTOR OR CONSULTANT.

Except as otherwise provided in a Participant’s Stock Grant Agreement, the following rules apply in the event of the death of a Participant while the Participant is an Employee, director or Consultant of the Company or of an Affiliate: to the extent the forfeiture provisions or the Company’s rights of repurchase have not lapsed on the date of death, such forfeiture provisions or rights of repurchase shall lapse to the extent of a pro rata portion of the Shares subject to such Stock Grant through the date of death, with such pro-ration being based on the portion of the applicable vesting period elapsed prior to the Participant’s date of death.

22.

PURCHASE FOR INVESTMENT.

Unless the offering and sale of the Shares shall have been effectively registered under the Securities Act, the Company shall be under no obligation to issue Shares under the Plan unless and until the ~~2022 Annual Meeting~~following conditions have been fulfilled:

(a) The person who receives a Stock Right shall warrant to the Company, prior to the receipt of ~~Stockholders~~Shares, that such person is acquiring such Shares for his or her own account, for investment, and not with a view to, or for sale in connection with, the distribution of any such Shares, in which event the person acquiring such Shares shall be bound by the provisions of the following legend (or a legend in substantially similar form) which shall be endorsed upon the certificate evidencing the Shares issued pursuant to such exercise or such grant (or notated in similar fashion on the Company’s stock registry):

“The shares represented hereby have been taken for investment and they may not be sold or otherwise transferred by any person, including a pledgee, unless (1) either (a) a Registration Statement with respect to such shares shall be effective under the Securities Act of 1933, as amended, or (b) the Company shall have received an opinion of counsel satisfactory to it that an exemption from registration under such Act is then available, and (2) there shall have been compliance with all applicable state securities laws.”

(b) At the discretion of the Administrator, the Company shall have received an opinion of its counsel that the Shares may be issued in compliance with the Securities Act without registration thereunder.

23.

DISSOLUTION OR LIQUIDATION OF THE COMPANY.

Upon the dissolution or liquidation of the Company, all Options granted under this Plan which as of such date shall not have been exercised and all Stock Grants and Stock-Based Awards which have not been accepted, to the extent required under the applicable Agreement, will terminate and become null and void; provided, however, that if the rights of a Participant or a Participant’s Survivors have not otherwise terminated and expired, the Participant or the Participant’s Survivors will have the right immediately prior to such dissolution or liquidation to exercise or accept any Stock Right to the extent that the Stock Right is exercisable or subject to acceptance as of the date immediately prior to such dissolution or liquidation. Upon the dissolution or liquidation of the Company, any outstanding Stock-Based Awards shall immediately terminate unless otherwise determined by the Administrator or specifically provided in the applicable Agreement.

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24.

ADJUSTMENTS.

Upon the occurrence of any of the following events, a Participant’s rights with respect to any Stock Right granted to him or her hereunder shall be adjusted as hereinafter provided, unless otherwise specifically provided in a Participant’s Agreement:

(a) Stock Dividends and Stock Splits. If (i) the shares of Common Stock shall be subdivided or combined into a greater or smaller number of shares or if the Company shall issue any shares of Common Stock as a stock dividend on its outstanding Common Stock, or (ii) additional shares or new or different shares or other securities of the Company or other non-cash assets are distributed with respect to such shares of Common Stock or if the Company pays an extraordinary cash dividend, each Stock Right and the number of shares of Common Stock deliverable thereunder shall be appropriately increased or decreased proportionately, and appropriate adjustments shall be made including, in the exercise or purchase price per share, to reflect such events. The number of Shares subject to the limitations in Paragraph 3(a), 3(b) and 4(c) shall also be proportionately adjusted upon the occurrence of such events.

(b) Corporate Transactions. If the Company is to be consolidated with or acquired by another entity in a merger, consolidation, or sale of all or substantially all of the Company’s assets other than a transaction to merely change the state of incorporation (a “Corporate Transaction”), the Administrator or the board of directors of any entity assuming the obligations of the Company hereunder (the “Successor Board”), shall, as to outstanding Options, either (i) make appropriate provision for the continuation of such Options by substituting on an equitable basis for the Shares then subject to such Options either the consideration payable with respect to the outstanding shares of Common Stock in connection with the Corporate Transaction or securities of any successor or acquiring entity; or (ii) upon written notice to the Participants, provide that such Options must be exercised (either (A) to the extent then exercisable or, (B) at the discretion of the Administrator, any such Options being made partially or fully exercisable for purposes of this Subparagraph), within a specified number of days of the date of such notice, at the end of which period such Options which have not been exercised shall terminate; or (iii) terminate such Options in exchange for payment of an amount (if any) equal to the consideration payable upon consummation of such Corporate Transaction to a holder of the number of shares of Common Stock into which such Option would have been exercisable (either (A) to the extent then exercisable or, (B) at the discretion of the Administrator, any such Options being made partially or fully exercisable for purposes of this Subparagraph) less the aggregate exercise price thereof. For purposes of determining the payments to be made pursuant to Subclause (iii) above, in the case of a Corporate Transaction the consideration for which, in whole or in part, is other than cash, the consideration other than cash shall be valued at the fair value thereof as determined in good faith by the Board of Directors.

With respect to outstanding Stock Grants, the Administrator or the Successor Board, shall make appropriate provision for the continuation of such Stock Grants on the same terms and conditions by substituting on an equitable basis for the Shares then subject to such Stock Grants either the consideration payable with respect to the outstanding Shares of Common Stock in connection with the Corporate Transaction or securities of any successor or acquiring entity. In lieu of the foregoing, in connection with any Corporate Transaction, the Administrator may provide that, upon consummation of the Corporate Transaction, each outstanding Stock Grant shall be terminated in exchange for payment of an amount equal to the consideration payable upon consummation of such Corporate Transaction to a holder of the number of shares of Common Stock comprising such Stock Grant (to the extent such Stock Grant is no longer subject to any forfeiture or repurchase rights then in effect or, at the discretion of the Administrator, all forfeiture and repurchase rights being waived upon such Corporate Transaction).

In taking any of the actions permitted under this Paragraph 24(b), the Administrator shall not be obligated by the Plan to treat all Stock Rights, all Stock Rights held by a Participant, or all Stock Rights of the same type, identically.

(c) Recapitalization or Reorganization. In the event of a recapitalization or reorganization of the Company other than a Corporate Transaction pursuant to which securities of the Company or of another corporation are issued with respect to the outstanding shares of Common Stock, a Participant upon

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exercising an Option or accepting a Stock Grant after the recapitalization or reorganization shall be entitled to receive for the price paid upon such exercise or acceptance if any, the number of replacement securities which would have been received if such Option had been exercised or Stock Grant accepted prior to such recapitalization or reorganization.

(d) Adjustments to Stock-Based Awards. Upon the happening of any of the events described in Subparagraphs (a), (b) or (c) above, any outstanding Stock-Based Award shall be appropriately adjusted to reflect the events described in such Subparagraphs. The Administrator or the Successor Board shall determine the specific adjustments to be made under this Paragraph 24, including, but not limited to the effect of any Corporate Transaction and, subject to Paragraph 4, its determination shall be conclusive.

(e) Modification of Options. Notwithstanding the foregoing, any adjustments made pursuant to Subparagraph (a), (b) or (c) above with respect to Options shall be made only after the Administrator determines whether such adjustments would (i) constitute a “modification” of any ISOs (as that term is defined in Section 424(h) of the Code) or (ii) cause any adverse tax consequences for the holders of Options, including, but not limited to, pursuant to Section 409A of the Code. If the Administrator determines that such adjustments made with respect to Options would constitute a modification or other adverse tax consequence, it may refrain from making such adjustments, unless the holder of an Option specifically agrees in writing that such adjustment be made and such writing indicates that the holder has full knowledge of the consequences of such “modification” on his or her income tax treatment with respect to the Option. This paragraph shall not apply to the acceleration of the vesting of any ISO that would cause any portion of the ISO to violate the annual vesting limitation contained in Section 422(d) of the Code, as described in Paragraph 6(b)(iv).

25.

ISSUANCES OF SECURITIES.

Except as expressly provided herein, no issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of shares subject to Stock Rights. Except as expressly provided herein, no adjustments shall be made for ordinary dividends paid in cash prior to any issuance of Shares pursuant to a Stock Right.

26.

FRACTIONAL SHARES.

No fractional shares shall be issued under the Plan and the person exercising a Stock Right shall receive from the Company cash in lieu of such fractional shares equal to the Fair Market Value thereof.

27.

CONVERSION OF ISOs INTO NON-QUALIFIED OPTIONS; TERMINATION OF ISOs.

The Administrator, at the written request of any Participant, may in its discretion take such actions as may be necessary to convert such Participant’s ISOs (or any portions thereof) that have not been exercised on the date of conversion into Non-Qualified Options at any time prior to the expiration of such ISOs, regardless of whether the Participant is an Employee of the Company or an Affiliate at the time of such conversion. At the time of such conversion, the Administrator (with the consent of the Participant) may impose such conditions on the exercise of the resulting Non-Qualified Options as the Administrator in its discretion may determine, provided that such conditions shall not be inconsistent with this Plan. Nothing in the Plan shall be deemed to give any Participant the right to have such Participant’s ISOs converted into Non-Qualified Options, and no such conversion shall occur until ~~their respective successors~~and unless the Administrator takes appropriate action. The Administrator, with the consent of the Participant, may also terminate any portion of any ISO that has not been exercised at the time of such conversion.

28.

WITHHOLDING.

In the event that any federal, state, or local income taxes, employment taxes, Federal Insurance Contributions Act withholdings or other amounts are ~~duly elected~~required by applicable law or governmental regulation to be withheld in connection with the issuance of a Stock Right or Shares under the Plan or for any other reason required by law, the Company may withhold from the Participant’s compensation, if any, or may require that the Participant advance in cash to the Company, or to any Affiliate of the Company which employs or employed the Participant, the required amount of such withholdings unless a different withholding arrangement, including the use of shares of the Company’s Common Stock or a promissory

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note, is authorized by the Administrator (and permitted by law). For purposes hereof, the fair market value of the shares withheld for purposes of payroll withholding shall be determined in the manner set forth under the definition of Fair Market Value provided in Paragraph 1 above, as of the most recent practicable date prior to the date of exercise or delivery. If the Fair Market Value of the shares withheld is less than the amount of payroll withholdings required, the Participant will be required to pay the difference in cash to the Company or the Affiliate employer.

29.

NOTICE TO COMPANY OF DISQUALIFYING DISPOSITION.

Each Employee who receives an ISO must agree to notify the Company in writing immediately after the Employee makes a Disqualifying Disposition of any Shares acquired pursuant to the exercise of an ISO. A “Disqualifying Disposition” is defined in Section 424(c) of the Code and qualified: 1a. Paolo Fundarò 1b. Jerome Durso 1c. Srinivas Akkaraju, M.D., Ph.D. 1d. Luca Benatti, Ph.D. 1g. Nancy Miller-Rich 1i. Dagmar Rosa-Bjorkeson 1j. Gino Santini 1k. Glenn Sblendorio 1e. Daniel Bradbury 1f. Keith Gottesdiener, M.D. 1h. Mark Pruzanski, M.D. For Against Abstain Three Years One Year Two Years Abstain For Against Abstainincludes any disposition (including any sale or gift) of such Shares before the later of (a) two years after the date the Employee was granted the ISO, or (b) one year after the date the Employee acquired Shares by exercising the ISO, except as otherwise provided in Section 424(c) of the Code. If the Employee has died before such Shares are sold, these holding period requirements do not apply and no Disqualifying Disposition can occur thereafter.

30.

TERMINATION OF THE PLAN.

The Plan will terminate on May 25, 2032. The Plan may be terminated at an earlier date by the Board of Directors; provided, however, that any such earlier termination shall not affect any Agreements executed prior to the effective date of such termination. Termination of the Plan shall not affect any Stock Rights theretofore granted.

31.

AMENDMENT OF THE PLAN AND AGREEMENTS.

The Plan may be amended by the Administrator. Any amendment approved by the Administrator which the Administrator determines requires shareholder approval shall be subject to obtaining such shareholder approval. Any modification or amendment of the Plan shall not, without the consent of a Participant, adversely affect his or her rights under a Stock Right previously granted to him or her. With the consent of the Participant affected, the Administrator may amend outstanding Agreements in a manner which may be adverse to the Participant but which is not inconsistent with the Plan. In the discretion of the Administrator, outstanding Agreements may be amended by the Administrator in a manner which is not adverse to the Participant.

32.

EMPLOYMENT OR OTHER RELATIONSHIP.

Nothing in this Plan or any Agreement shall be deemed to prevent the Company or an Affiliate from terminating the employment, consultancy or director status of a Participant, nor to prevent a Participant from terminating his or her own employment, consultancy or director status or to give any Participant a right to be retained in employment or other service by the Company or any Affiliate for any period of time.

33.

GOVERNING LAW.

This Plan shall be construed and enforced in accordance with the law of the State of Delaware.

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SCAN TO VIEW MATERIALS & VOTE INTERCEPT PHARMACEUTICALS, INC. ~~10 HUDSON YARDS 37TH FLOOR NEW YORK, NY 10001~~305 MADISON AVENUE MORRISTOWN, NJ 07960 VOTE BY INTERNET Before The Meeting —- Go to www.proxyvote.com or scan the QR Barcode above Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 p.m. Eastern Time the day before the cut-off date or meeting date. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form. During The Meeting —- Go to www.virtualshareholdermeeting.com/~~ICPT2021~~ICPT2022 You may attend the meeting via the Internet and vote during the meeting. Have the information that is printed in the box marked by the arrow available and follow the instructions. VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. ~~For Withhold 5.~~TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: D78222-P68210 KEEP THIS PORTION FOR ~~the ratification of the appointment of KPMG LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2021.~~ YOUR RECORDS THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. DETACH AND RETURN THIS PORTION ONLY 1g.Nancy Miller-Rich!! 1h. Mark Pruzanski, M.D.!! 1i. Dagmar

Rosa-Bjorkeson!! 1j. Gino Santini!! 1k. Glenn Sblendorio!! ! ! ! ! ! ! ! ! ! ! ! ! Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer.D49154-P54574

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INTERCEPT PHARMACEUTICALS, INC. Annual Meeting of Stockholders May 25, 2022 Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Stockholders To Be Held on May ~~27, 2021~~25, 2022 The Proxy Statement and ~~2020~~2021 Annual Report are available at www.proxyvote.com. ~~INTERCEPT PHARMACEUTICALS, INC. Annual Meeting of Stockholders May 27, 2021~~D78223-P68210 INTERCEPT PHARMACEUTICALS, INC. THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS The undersigned, revoking all prior proxies, hereby appoints Jerome Durso, Jared Freedberg, ~~Rocco Venezia,~~Jose Truzman, and ~~Mary Grendell,~~Edward Mahaney-Walter, or any of them, with the power of substitution, to represent and vote the shares of the undersigned, with all the powers which the undersigned would possess, at the Annual Meeting of Stockholders of Intercept Pharmaceuticals, Inc., to be held on May ~~27, 2021,~~25, 2022, at ~~10:30 a.m. (Eastern Time)~~12:00 p.m., Eastern Time by visiting www.virtualshareholdermeeting.com/~~ICPT2021~~ICPT2022 or at any postponement or adjournment thereof. This proxy, when properly executed, will be voted as directed. If no direction is made, the proxy shall be voted: 1. FOR the election of the nominees listed in Proposals 1a to 1k as directors. 2. FOR the approval of ~~a one-time stock option exchange program for non-executive employees. 3.~~the Company’s Amended and Restated Equity Incentive Plan. FOR the approval, on a non-binding, advisory basis, of the compensation of the Company’s named executive officers. ~~4. Voting on a non-binding, advisory basis, that the stockholder advisory vote on the compensation of the Company’s named executive officers should occur every ONE YEAR. 5.~~ FOR the ratification of

the appointment of KPMG LLP as the Company’s independent registered public accounting firm for the year ending December 31, ~~2021.~~2022. In their discretion, the Proxies are authorized to vote upon such other business as may properly come before the meeting or any postponement or adjournment thereof. (Continued and to be signed on Reverse Side)

1A. Paolo Fundarò	1B. Jerome Durso	1C. Srinivas Akkaraju, M.D., Ph.D.
1D. Luca Benatti, Ph.D.	1E. Daniel Bradbury	1F. Keith Gottesdiener, M.D.
1G. Nancy Miller-Rich	1H. Mark Pruzanski, M.D.	1I. Dagmar Rosa-Bjorkeson
1J. Gino Santini	1K. Glenn Sblendorio

	2021						2022
Name	Options		RSUs		PSUs		Options		RSUs		PSUs
Jerome Durso		72,000		46,000		110,300		60,900		35,700		107,000
Andrew Saik		72,540		52,156		—		17,600		10,300		10,300
Sandip Kapadia		26,900		17,200		13,800		—		—		—
Rocco Venezia		5,500		3,438		—		6,100		3,600		3,600
Jared Freedberg		69,400		44,277		—		17,600		10,300		10,300
Michelle Berrey		93,000		67,118		—		17,600		10,300		10,300
Gail Cawkwell		19,700		12,600		10,100		11,300		6,600		6,600

~~Relative TSR~~			~~Vesting~~ ~~Percentage~~
~~Below 25~~th ~~Percentile~~			0%
25th ~~Percentile~~			~~50%~~
50th ~~Percentile~~			~~100%~~
75th ~~Percentile and Above~~			~~150%~~

Named Executive Officer	TSR PSUs		Stock Options		Restricted Stock Units
Mark Pruzanski, M.D.		25,800		17,700		10,800
Jerome Durso		8,500		17,400		10,600
Sandip Kapadia		4,500		9,200		5,600
Richard Kim		4,300		8,800		5,400
Lisa Bright		3,800		7,900		4,800
Ryan Sullivan		4,500		9,200		5,600
Christian Weyer, M.D., M.A.S.		3,800		7,900		4,800

Name and Principal Position(1)	Year(1)		Salary ($)(2)		Bonus ($)(3)		Stock Awards ($)(4)		Option Awards ($)(4)		Non-Equity Incentive Plan Compensation ($)(5)		All Other Compensation ($)(6)		Total ($)		Year		Salary ($)		Bonus ($)(2)		Stock Awards ($)(3)		Option Awards ($)(3)		Non-Equity Incentive Plan Compensation ($)(4)		All Other Compensation ($)(5)		Total ($)
Mark Pruzanski, M.D., President and Chief Executive Officer		2020		757,850		—		4,113,504		1,015,996		531,995		7,660		6,427,005
		2019		734,292		—		4,197,742		1,116,118		560,265		7,368		6,615,785
		2018		702,000		—		1,667,718		1,705,358		442,260		8,623		4,525,960
Jerome Durso, Chief Operating Officer		2020		599,524		—		2,057,016		998,776		231,737		21,910		3,908,963
		2019		573,250		—		2,089,570		1,238,321		359,284		21,368		4,281,793
		2018		540,800		—		1,554,326		775,844		292,032		22,403		3,185,406
Sandip Kapadia, Chief Financial Officer and Treasurer		2020		476,863		—		1,087,836		528,088		184,039		21,910		2,298,736
		2019		464,100		—		1,001,664		586,573		252,935		21,368		2,326,640
		2018		442,000		—		790,164		393,544		228,735		22,403		1,876,846
Richard Kim, Former President, U.S. Commercial & Strategic Marketing		2020		456,095		—		1,044,360		505,128		168,056		79,211		2,252,850
		2019		442,900		202,800		890,368		521,398		265,519		76,343		2,399,328
Lisa Bright, Former President, International (7)		2020		480,552		—		925,704		453,467		240,955		139,106		2,239,784
Ryan Sullivan, Former General Counsel and Secretary		2020		437,107		—		1,087,836		528,088		—		89,942		2,142,973
		2019		445,520		—		1,471,902		871,713		267,089		21,368		3,077,592
		2018		376,158		—		1,239,112		1,190,351		229,122		173,437		3,208,180
Christian Weyer, M.D., M.A.S., EVP, Research & Development		2020		486,731		—		925,704		453,467		170,804		21,910		2,058,616
Jerome Durso, President & CEO																		2021		690,750		—		5,474,865		1,234,800		435,994		33,945		7,870,354
																		2020		599,524		—		2,057,016		998,776		231,737		21,910		3,908,963
																		2019		573,250		—		2,089,570		1,238,321		359,284		21,368		4,281,793
Andrew Saik, CFO																		2021		251,894		102,500		1,086,931		903,848		113,823		16,857		2,475,854
Sandip Kapadia, Former CFO																		2021		117,513		—		1,022,142		461,335		—		59,674		1,660,664
																		2020		476,863		—		1,087,836		528,088		184,039		21,910		2,298,736
																		2019		464,100		—		1,001,664		586,573		252,935		21,368		2,326,640
Rocco Venezia, Interim CFO & Chief Accounting Officer																		2021		354,554		154,000		101,283		94,325		131,648		20,423		856,234
Jared Freedberg, General Counsel																		2021		423,133		—		1,633,821		1,487,242		208,112		21,714		3,774,023
Michelle Berrey, President of R&D and Chief Medical Officer																		2021		329,545		—		1,434,983		1,186,680		148,970		18,321		3,118,499
Gail Cawkwell, SVP Medical Affairs, Safety & Pharmacovigilance																		2021		478,412		750,000		748,431		337,855		216,385		31,244		2,562,328

	Page
ANNUAL MEETING MATTERS		1
General Information About the Annual Meeting and Voting		1
CAUTIONARY NOTE REGARDING FORWARD-LOOKING ~~STATEMENTS~~STATEMENTS.		76
PROPOSALS UNDER VOTE		109
PROPOSALS 1A THROUGH 1K: ELECTION OF DIRECTORS		109
Vote Required for Approval		1514
PROPOSAL 2: APPROVAL OF ~~A ONE-TIME STOCK OPTION EXCHANGE PROGRAM FOR NON-EXECUTIVE EMPLOYEES~~OUR AMENDED AND RESTATED EQUITY INCENTIVE PLAN		15
Overview		15
Burn Rate & Overhang		15
Plan Features		16
~~Introduction~~Summary of Material Terms of the Plan		16
~~Stockholder-Friendly Design~~Purpose		16
~~Background and Reasons for the Option Exchange Program~~Plan Participants		16
~~Overview~~Administrator; Awards Available Under the Plan		16
Amendments		17
Other Provisions		17
New Plan Benefits		17
Certain Federal Income Tax Consequences in Respect of the Plan		18
Other Disclosures		19
~~Exchange Ratio~~		19
~~Implementing the Exchange Program~~		20
~~Other Matters~~		20
Vote Required for Approval		2119
PROPOSAL 3: NON-BINDING, ADVISORY VOTE ON THE COMPENSATION OF THE COMPANY’S NAMED EXECUTIVE OFFICERS		20
Vote Required for Approval		20
PROPOSAL 4: RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM		22
Vote Required for Approval		23
~~PROPOSAL 4: NON-BINDING, ADVISORY VOTE ON THE FREQUENCY OF THE SAY-ON-PAY VOTE~~		24
~~Vote Required for Approval~~		24
~~PROPOSAL 5: RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM~~		25
~~Vote Required for Approval~~		2522
BOARD OF DIRECTORS AND GOVERNANCE		2623
Composition of the Board		2623
Role and Meetings of the Board		2623
Corporate Governance		2623
Board Leadership Structure		2623
Board Oversight of Risk		2723
Independence		2724
Executive Sessions and Meetings of Independent Directors		2724
Board Attendance at Annual Meetings of Stockholders		2724
Communication with the Board		2724
Global Code of Business Conduct		2825
~~Our Practices Regarding:~~ Environmental, Social, and Corporate Governance (“ESG”)~~, Diversity,~~ ~~Equity, and Inclusion (“DEI”), and Human Capital and Corporate Culture~~ Practices		2825
Additional Corporate Policies		30
~~Committees of the Board~~		31
~~Audit Committee~~		3127

Per Share Exercise Price ($)	Number of Outstanding Options in Range		Weighted Average Exercise Price ($)		Weighted Average Remaining Term		Exchange Ratio		New Options Issuable (assuming full participation)
55.59 – 75.00		235,000		61.57		6.72		1.25 – 1		188,000
75.01 – 115.00		576,000		103.07		7.46		1.50 – 1		384,000
115.01 – 125.00		60,000		120.62		5.26		2.00 – 1		30,000
125+		96,000		201.20		3.85		4.00 – 1		24,000

	Shares Beneficially Owned(11)
Name and Address	Number of Shares		Percentage of Common Stock
5% Stockholders:
Genextra S.p.A.(1)		4,000,000		12.1%
FMR LLC(2)		3,726,914		11.2%
The Vanguard Group(3)		2,828,955		8.5%
State Street Corporation(4)		2,550,750		7.7%
BlackRock, Inc.(5)		2,498,408		7.5%
First Trust Portfolios L.P.(6)		1,975,601		6.0%
Directors and Executive Officers:
Paolo Fundarò(1)		4,036,555		12.2%
Jerome Durso		73,967		*
Srinivas Akkaraju, M.D., Ph.D.(7)		678,335		2.0%
Luca Benatti, Ph.D.		24,544		*
Daniel Bradbury(8)		29,714		*
Keith Gottesdiener, M.D.		23,073		*
Nancy Miller-Rich		20,362		*
Mark Pruzanski, M.D.(9)		856,763		2.6%
Dagmar Rosa-Bjorkeson		—		—
Gino Santini		23,901		*
Glenn Sblendorio		22,504		*
Daniel Welch		23,082		*
Sandip Kapadia(10)		85,458		*
Richard Kim(10)		48,563		*
Lisa Bright(10)		79,919		*
Ryan Sullivan(10)		24,708		*
Christian Weyer, M.D., M.A.S.		32,077		*
All current directors and executive officers as a group (20 persons)		5,944,358		17.9%

Named Executive Officer	2020 Salary(1)			2019 Salary			Change from 2019
Mark Pruzanski, M.D.		$	759,992		$	734,292		3.50%
Jerome Durso		$	601,913		$	573,250		5.00%
Sandip Kapadia		$	478,023		$	464,100		3.00%
Richard Kim		$	457,294		$	442,900		3.25%
Lisa Bright(2)		$	481,910		$	465,613		3.50%
Ryan Sullivan		$	461,113		$	445,520		3.50%
Christian Weyer, M.D., M.A.S.		$	488,011		$	472,650		3.25%

2020 Corporate Goal Summary	Relative Weighting	Assessed Achievement
NASH Program	50%	15%
Includes specified activities and milestones related to:
• securing FDA approval for OCA in NASH • executing the launch of OCA in NASH in accordance with the Company’s launch preparation plans • ensuring that launch plans are in place, including with respect to targeting, organizational capabilities, competencies and team engagement, and that appropriate launch preparations are executed in a timely way
PBC Commercial Program	25%	30%
Includes specified commercial milestone as follows:
• achieve pre-specified Ocaliva total unit sales for 2020
Pipeline	15%	15%
Includes specified activities and milestones related to:
• manufacturing selected fixed-dose combination (“FDC”) formulation for potential use and study • timing and completion of key activities required to prepare for first-in-human clinical trial of INT-787
Organization	10%	10%
Includes specified activities and milestones related to:
• effective organizational management related to human resources, capabilities, and competencies for executing on organizational priorities, including potential launch of OCA for liver fibrosis due to NASH • recruiting and training of appropriate staff • appropriate management of expenses and headcount
Total	100%	70%

	2020 Cash Incentive Bonus
Named Executive Officer	Target (as % of Base Salary)		Corporate Goal Achievement Level		Individual Goal Achievement Level		Aggregate Achievement (as % of Base Salary)		Payment ($)
Mark Pruzanski, M.D.		70%		N/A		—		N/A		531,995(1)
Jerome Durso		50%		70%		110%		39%		231,737
Sandip Kapadia		50%		70%		110%		39%		184,039
Richard Kim		50%		70%		105%		37%		168,056
Lisa Bright		50%		—		—		—		240,955(2)
Ryan Sullivan		50%		—		—		—		—(3)
Christian Weyer, M.D., M.A.S.		50%		70%		100%		35%		170,804

	2021										2022 Target
Name	Target		Corporate Performance		Individual Performance		Payout		Payout ($)		2022 Target
Jerome Durso		70%		90.17%		N/A		63.119%		435,994.49		70%
Andrew Saik		50%		90.17%		100%		45.085%		113,822.72		50%
Sandip Kapadia		N/A		N/A		N/A		N/A		N/A		N/A
Rocco Venezia		40%		90.17%		100%		36.068%		131,648.20		50%
Jared Freedberg		50%		90.17%		100%		45.085%		208,112.36		50%
Michelle Berrey		50%		90.17%		100%		45.085%		148,969.86		50%
Gail Cawkwell		50%		90.17%		100%		45.085%		216,385.46		50%

Named Executive Officer	2021 Salary			2020 Salary			Change from 2020
Jerome Durso		$	690,750		$	601,913		14.76%
Sandip Kapadia*		$	497,140		$	478,023		4.00%
Richard Kim*		$	457,294		$	457,294		—
Christian Weyer, M.D., M.A.S.		$	504,000		$	488,011		3.28%

~~Named Executive Officer~~	~~Target Cash~~ ~~Incentive Bonus~~ ~~(as % of~~ ~~Base Salary)~~
~~Jerome Durso~~		70%
Sandip Kapadia*		50%
Richard Kim*		50%
~~Christian Weyer, M.D., M.A.S.~~		50%

Name	Contributions Under Retirement Plans ($)(i)		Health Insurance ($)(ii)		Miscellaneous ($)
Mark Pruzanski, M.D.		—		7,660		—
Jerome Durso		14,250		7,660		—
Sandip Kapadia		14,250		7,660		—
Richard Kim(iii)		14,250		7,660		57,301
Lisa Bright(iv)		86,499		18,168		34,439
Ryan Sullivan(v)		14,250		7,660		68,032
Christian Weyer, M.D., M.A.S.		14,250		7,660		—

Name	Grant Date(1)		Estimated Future Payout Under Non-Equity Incentive Plan Awards Target ($)(2)		Estimated Future Payouts Under Equity Incentive Plan Awards(3)						All Other Stock Awards: Number of Shares of Stock (#)(5)		All Other Option Awards: Number of Securities Underlying Options (#)(6)		Exercise or Base Price of Option Awards ($/Sh)(7)		Grant Date Fair Value of Stock and Option Awards ($)(8)		Grant Date(1)		Estimated Future Payout Under Non-Equity Incentive Plan Awards Target ($)(2)		Estimated Future Payouts Under Equity Incentive Plan Awards(3)						All Other Stock Awards: Number of Shares of Stock (#)(4)		All Other Option Awards: Number of Securities Underlying Options (#)(5)		Exercise or Base Price of Option Awards ($/Sh)(6)		Grant Date Fair Value of Stock and Option Awards ($)(7)
Name	Grant Date(1)				Threshold (#)(4)		Target (#)		Maximum (#)		All Other Stock Awards: Number of Shares of Stock (#)(5)				Exercise or Base Price of Option Awards ($/Sh)(7)		Grant Date Fair Value of Stock and Option Awards ($)(8)		Grant Date(1)				Threshold (#)		Target (#)		Maximum (#)		All Other Stock Awards: Number of Shares of Stock (#)(4)				Exercise or Base Price of Option Awards ($/Sh)(6)		Grant Date Fair Value of Stock and Option Awards ($)(7)
Mark Pruzanski, M.D.		—		531,995		—		—		—		—		—		—		—
		01/23/20		—		12,900		25,800		38,700		—		—		—		3,037,176
		01/23/20		—		—		—		—		10,800		—		—		1,076,328
		01/23/20		—		—		—		—		—		17,700		57.40		1,015,996
Jerome Durso		—		300,956		—		—		—		—		—		—		—		—		483,525		—		—		—		—		—		—		—
		01/23/20		—		4,250		8,500		12,750		—		—		—		1,000,620		01/22/21		—		55,150		110,300		165,450		—		—		—		4,119,705
		01/23/20		—		—		—		—		10,600		—		—		1,056,396		01/22/21		—		—		—		—		46,000		—		—		1,355,160
		01/23/20		—		—		—		—		—		17,400		57.40		998,776		01/22/21		—		—		—		—		—		72,000		29.46		1,234,800
Andrew Saik																				—		237,500		—		—		—		—		—		—		—
																				06/21/21		—		—		—		—		—		—		—		—
																				06/21/21		—		—		—		—		52,156		—		—		1,086,931
																				06/21/21		—		—		—		—		—		72,540		20.84		903,848
Sandip Kapadia		—		239,012		—		—		—		—		—		—		—		—		—		—		—		—		—		—		—		—
		01/23/20		—		2,250		4,500		6,750		—		—		—		529,740		01/22/21		—		6,900		13,800		20,700		—		—		—		515,430
		01/23/20		—		—		—		—		5,600		—		—		558,096		01/22/21		—		—		—		—		17,200		—		—		506,712
		01/23/20		—		—		—		—		—		9,200		57.40		528,088		01/22/21		—		—		—		—		—		26,900		29.46		461,335
Richard Kim		—		228,647		—		—		—		—		—		—		—
		01/23/20		—		2,150		4,300		6,450		—		—		—		506,196
		01/23/20		—		—		—		—		5,400		—		—		538,164
		01/23/20		—		—		—		—		—		8,800		57.40		505,128
Lisa Bright		—		240,955		—		—		—		—		—		—		—
		01/23/20		—		1,900		3,800		5,700		—		—		—		447,336
		01/23/20		—		—		—		—		4,800		—		—		478,368
		01/23/20		—		—		—		—		—		7,900		57.40		453,467
Ryan Sullivan		—		—		—		—		—		—		—		—		—
		01/23/20		—		2,250		4,500		6,750		—		—		—		529,740
		01/23/20		—		—		—		—		5,600		—		—		558,096
		01/23/20		—		—		—		—		—		9,200		57.40		528,088
Christian Weyer, M.D., M.A.S		—		244,006		—		—		—		—		—		—		—
		01/23/20		—		1,900		3,800		5,750		—		—		—		447,336
		01/23/20		—		—		—		—		4,800		—		—		478,368
		01/23/20		—		—		—		—		—		7,900		57.40		453,467
Rocco Venezia																				—		146,000		—		—		—		—		—		—		—
																				01/22/21		—		—		—		—		—		—		—		—
																				01/22/21		—		—		—		—		3,438		—		—		101,283
																				01/22/21		—		—		—		—		—		5,500		29.46		94,325
Jared Freedberg																				—		230,800		—		—		—		—		—		—		—
																				02/01/21		—		—		—		—		—		—		—		—
																				02/01/21		—		—		—		—		44,277		—		—		1,633,821
																				02/01/21		—		—		—		—		—		69,400		36.90		1,487,242
Michelle Berrey																				—		300,000		—		—		—		—		—		—		—
																				06/14/21		—		—		—		—		—		—		—		—
																				06/14/21		—		—		—		—		67,118		—		—		1,434,983
																				06/14/21		—		—		—		—		—		93,000		21.38		1,186,680
Gail Cawkwell																				—		239,975		—		—		—		—		—		—		—
																				01/22/21		—		5,050		10,100		15,150		—		—		—		377,235
																				01/22/21		—		—		—		—		12,600		—		—		371,196
																				01/22/21		—		—		—		—		—		19,700		29.46		337,855

Key areas of stockholder focus

Our responses

Investors asked about the treatment of outstanding PSUs in the Retirement and Consulting Agreement of our retired CEO Mark Pruzanski. These PSUs vested at the maximum level (150%), although based on our stock performance the PSUs of other NEOs vested last year at 0%.

Regarding Dr. Pruzanski’s retirement, we responded to stockholder concerns by noting that Dr. Pruzanski, as the founder and CEO of the Company, had a long-standing employment agreement, and that the intention of the Retirement and Consulting Agreement was to honor the terms of the employment agreement, particularly regarding equity vesting upon separation. Our management noted that we had reviewed all of our remaining employment agreements with executive officers, and none had provisions for equity vesting similar to those contained in the Retirement and Consulting Agreement.
Accordingly, in the judgment of the Compensation Committee, the terms of the Retirement and Consulting Agreement are distinct from the management and evaluation of our go-forward executive compensation program.

During the course of our investor outreach, we explained the challenges of delivering competitive executive compensation, particularly with regards to long-term incentives, in a period where our stock price has been depressed for a sustained period of time. These challenges impact both the attraction of new executive talent, and also the retention and incentivization of existing executives. We shared that, in response to these challenges, the Company has had to deploy new and innovative compensation tools in 2021 and 2022 to respond to these circumstances—and that these tools have proven to be, largely, effective. Investors clearly understood the challenges facing the Company and the competitive pressures driving the needs for innovation in compensation, and requested an explanation of compensation measures implemented, including their usage and effectiveness.

In relation to this request, this Compensation Discussion and Analysis (“CD&A”) contains detailed explanations of the new hire awards issued to attract new executives, the cash retention plans used, selectively, to retain critical talents during 2021, and a new, cash-based, long-term incentive plan aimed at ensuring the competitiveness of the Company’s overall long-term incentive offering for executives.

Investors whom we spoke with were highly complimentary of our executive compensation disclosures, particularly the CD&A portions of our recent proxy statements with respect to comprehensiveness, transparency, and clear explanations of our corporate goals for purposes of payout under our annual cash incentive bonus program. Investors encouraged us to continue these disclosure practices, and improve them further where possible.

In this proxy statement, as in prior years, we continue to seek to provide useful disclosures to investors, including the calculations used to establish payout levels for our 2021 cash bonuses.