v3.26.1
Fair Value Measurements
 6 Months Ended
Jun. 30, 2026
Fair Value Disclosures [Abstract]  
Fair Value Measurements Fair Value Measurements
The Company’s fair value hierarchy for its financial assets and liabilities that are measured at fair value on a recurring basis as of June 30, 2026, is as follows (in thousands):

Level 1Level 2Level 3Total
Assets
Cash and cash equivalents:
Money market funds$177,689 $— $— $177,689 
Short-term available-for-sale investments:
Government and government agency— 160,427 — 160,427 
Corporate bonds— 70,810 — 70,810 
Other long-term assets:
Equity securities19,492 — 11,217 30,709 
Total assets$197,181 $231,237 $11,217 $439,635 
Liabilities
Earn-out consideration, current$— $— $24,322 $24,322 
Earn-out consideration, long-term— — 50,005 50,005 
Total liabilities$— $— $74,327 $74,327 

The Company’s fair value hierarchy for its financial assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2025, is as follows (in thousands):

Level 1Level 2Level 3Total
Assets
Cash and cash equivalents:
Money market funds$90,594 $— $— $90,594 
Short-term available-for-sale investments:
U.S. Treasury bills9,815 — — 9,815 
Government and government agency— 180,537 — 180,537 
Corporate bonds— 158,524 — 158,524 
Prepaid expenses and other current assets:
Short-term indemnification assets
— — 3,730 3,730 
Long-term available-for-sale investments:
Government and government agency— 271,175 — 271,175 
Corporate bonds— 80,088 — 80,088 
Other long-term assets:
Equity securities24,437 — — 24,437 
Long-term indemnification assets
— — 3,047 3,047 
Total assets$124,846 $690,324 $6,777 $821,947 
Liabilities
Earn-out consideration, long-term$— $— $50,745 $50,745 
Other long-term liabilities:
Long-term indemnification liabilities
— — 6,086 6,086 
Other contingent consideration— — 2,003 2,003 
Total liabilities$— $— $58,834 $58,834 
The fair values of cash, accounts receivable, accounts payable, and accrued liabilities approximated their carrying values as of June 30, 2026 and December 31, 2025, due to their short-term nature. The current and noncurrent deferred acquisition payable amounts, a significant majority of which is related to the Eucalyptus business combination, are a fixed monetary amount and are therefore not remeasured and are excluded from the table above. As of June 30, 2026, in connection with an amendment to the Zava share purchase agreement during the first quarter of 2026, all contingencies related to the Zava earn-out consideration for fiscal years 2026 and 2027 have been resolved and the final earn-out payment amounts have been determined, with settlement dates in fiscal years 2027 and 2028. As a result, the fair value of the current and noncurrent earn-out consideration related to the Zava business combination approximated their carrying value as of June 30, 2026 due to the payment amounts being fixed, and they are therefore excluded from the table above. Additionally, as of June 30, 2026, all contingencies related to the C S Bio Co. asset acquisition earn-out consideration have been resolved, and the final earn-out payment amount has been determined, with the settlement date in fiscal year 2026. As a result, the fair value of the earn-out consideration, all of which is current, approximated its carrying value as of June 30, 2026 due to the payment amount being fixed, and it is therefore excluded from the table above. The Convertible Notes are recorded at their net carrying amount on the unaudited condensed consolidated balance sheets rather than their fair value, which is a Level 2 measurement, as the Company has not elected the fair value option (refer to Note 13 – Debt for additional detail, including the fair value as of June 30, 2026). All other financial instruments, with the exception of the earn-out consideration discussed below, are valued either based on recent trades of securities in active markets or based on quoted market prices of similar instruments and other significant inputs derived from or corroborated by observable market data. During the six months ended June 30, 2026 and 2025, the Company had no transfers between levels of the fair value hierarchy of its assets measured at fair value.

As of June 30, 2026, in addition to the earn-out consideration discussed above, the Company had earn-out consideration related to the Medici, YourBio, and Eucalyptus business combinations. The fair values of the earn-out consideration related to the Medici business combination, some of which is current and some of which is noncurrent, approximated their carrying values as of June 30, 2026, due to all of the earn-out consideration being paid in cash and the timing of their payout being subject to estimation and, therefore, are excluded from the table above.

The noncurrent earn-out consideration related to the YourBio business combination is classified as Level 3 fair value measurements containing significant unobservable inputs including estimates of future sales of certain devices and, therefore, is included in the table above. The fair value of the earn-out consideration is remeasured at each reporting period.

A portion of the current and noncurrent earn-out consideration related to the Eucalyptus business combination is considered post-acquisition employee expense as it is subject to a continued service condition and is not contingent consideration. As a result, this portion approximated its carrying value as of June 30, 2026, and is therefore excluded from the table above. The other portion of the current and noncurrent earn-out consideration related to the Eucalyptus business combination, which are not subject to continued service conditions, are classified as Level 3 fair value measurements containing significant unobservable inputs including estimates of achieving certain revenue and adjusted EBITDA targets and, therefore, are included in the table above. At inception, the fair value of the earn-out consideration associated with the Eucalyptus business combination was determined based on revenue and adjusted EBITDA projections and the probability of achieving the respective revenue and adjusted EBITDA targets as evaluated using a Monte Carlo simulation. The following assumptions were used to determine the fair value at inception:

Risk-free rate5.0 %
Revenue volatility14.0 %
Internal rate of return13.2 %
Equity risk premium4.8 %
Market price of risk for revenue1.6 %
As of December 31, 2025, the earn-out consideration related to the Zava business combination, all of which was noncurrent, was classified as a Level 3 fair value measurement containing significant unobservable inputs including estimates of achieving certain revenue and adjusted EBITDA targets and, therefore, is included in the table above. At inception, the fair value of the earn-out consideration associated with the Zava business combination was determined based on revenue and adjusted EBITDA projections and the probability of achieving the respective revenue and adjusted EBITDA targets as evaluated using a Monte Carlo simulation. The following assumptions were used to determine the fair value at inception:

Risk-free rate1.9 %
Revenue volatility21.0 %
Revenue risk-adjusted discount rate9.0 %
Counterparty discount rate6.0 %

The fair values of the earn-out consideration related to the Zava, YourBio, and Eucalyptus business combinations, as applicable, are remeasured at each reporting period. The change in fair value is recognized within change in fair value of liabilities on the unaudited condensed consolidated statements of operations and comprehensive (loss) income. The change in the fair value of the earn-out consideration related to the Zava, YourBio, and Eucalyptus business combinations is as follows (in thousands):

Balance at December 31, 2025$50,745 
YourBio business combination10,573 
Eucalyptus business combination59,612 
Change in fair value(1)
21,869 
Resolved contingencies, current(40,096)
Resolved contingencies, long-term(26,944)
Foreign currency translation adjustments(1,432)
Balance at June 30, 2026$74,327 
______________
(1)Primarily driven by the impact of the amendment to the Zava share purchase agreement.