AKAO 2018 Proxy Statement

30 In September 2017, following consultation with Radford and review of the Company’s profile, the Compensation Committee approved a new peer group for determining 2018 compensation based on pre- commercial/commercial biopharmaceutical companies with market capitalization of approximately $250 million to $2.5 billion and headcount of under 250 employees, with emphasis on biotechnology hubs. The September 2017 peer group had the following changes from the January 2017 peer group: Ardelyx, Intra-Cellular Therapies, Rigel Pharmaceuticals and Zogenix were removed, and Global Blood Therapeutics, Halozyme Therapeutics, Omeros Radius Health, Sarepta Therapeutics, Spark Therapeutics, Ultragenyx Pharmaceutical were added. Our current peer group as of April 2018 thus consists of: • Adamas Pharmaceuticals • Cytokinetics • Omeros • Ultragenyx Pharmaceutical • Aerie Pharmaceuticals • Dermira • Otonomy • Versartis • Aimmune Therapeutics • Enanta Pharmaceuticals • Radius Health • Xencor • Akebia Therapeutics • Global Blood Therapeutics • Sarepta Therapeutics • ChemoCentryx • Halozyme • Spark Therapeutics Components of Compensation The primary elements of our NEOs’ compensation and the main objectives of each are: • Base Salary . Base salary attracts and retains talented executives, recognizes individual roles and responsibilities, and provides stable income; • Annual Performance-Based Incentive Compensation . Annual performance bonuses promote short- term performance objectives and reward executives for their contributions toward achieving those objectives; • Equity Based Long-Term Incentive Compensation . Equity compensation, provided in the form of stock options and RSUs, aligns executives’ interests with our stockholders’ interests, emphasizes long-term financial and operational performance, and helps retain executive talent. In addition, our NEOs are eligible to participate in our health and welfare programs and our 401(k) plan on the same basis as our other employees. We also maintain change in control and severance arrangements, which aid in attracting and retaining executive talent and help executives to remain focused and dedicated during potential transition periods due to a change in control. Each of these elements of compensation for 2017 is described further below.