Fair Value Measurements

6 Months Ended

Jun. 30, 2023

Fair Value Measurements

Fair Value Measurements

5. Fair Value Measurements

As of June 30, 2023 and December 31, 2022, the Company’s financial instruments consisted of cash, cash equivalents, available-for-sale marketable securities, accounts receivable, net – related party, prepaid expenses, restricted cash, accounts payable and accrued liabilities. The fair values of cash, cash equivalents, accounts receivable, net – related party, prepaid expenses, restricted cash, accounts payable and accrued liabilities approximate their carrying values due to the short-term nature of these financial instruments. Available-for-sale marketable securities are reported at their fair values, based upon pricing of securities with the same or similar investment characteristics as provided by third-party pricing services.

The Company validates the prices provided by its third-party pricing services by reviewing their pricing methods, obtaining market values from other pricing sources, and comparing them to the share prices presented by the third-party pricing services. After completing its validation procedures, the Company did not adjust or override any fair value measurements provided by its third-party pricing services as of June 30, 2023 or December 31, 2022.

The following tables summarize the Company’s financial assets measured at fair value on a recurring basis as of June 30, 2023 and December 31, 2022.

Fair value measurement as of June 30, 2023:


					Quoted prices in			Significant other			Significant
Financial assets					active markets for			observable			unobservable
					identical assets			inputs			inputs
Type of Instrument		Total			(Level 1)			(Level 2)			(Level 3)
Cash and cash equivalents:
Money market funds and checking accounts		$	58,249		$	58,249		$	—		$	—
Available-for-sale marketable securities:
U.S. government agency obligations			9,003			—			9,003			—
Corporate bonds			19,675			—			19,675			—
Municipal bonds			14,817			—			14,817			—
Restricted cash:
Commercial money market account			1,908			1,908			—			—
Total financial assets		$	103,652		$	60,157		$	43,495		$	—

Fair value measurement as of December 31, 2022:


					Quoted prices in			Significant other			Significant
Financial assets					active markets for			observable			unobservable
					identical assets			inputs			inputs
Type of Instrument		Total			(Level 1)			(Level 2)			(Level 3)
Cash and cash equivalents:
Money market funds and checking accounts		$	63,741		$	63,741		$	—		$	—
Available-for-sale marketable securities:
U.S. government agency obligations			8,877			—			8,877			—
Corporate bonds			35,185			—			35,185			—
Commercial paper			26,875			—			26,875			—
Municipal bonds			22,071			—			22,071			—
Restricted cash:
Commercial money market account			408			408			—			—
Total financial assets		$	157,157		$	64,149		$	93,008		$	—

There were no purchases, sales or maturities of Level 3 financial assets and no unrealized gains or losses related to Level 3 available-for-sale marketable securities during each of the three and six months ended June 30, 2023 and 2022. There were no transfers of financial assets into or out of Level 3 classification during each of the three and six months ended June 30, 2023 and 2022.

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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