Fair Value Measurements |
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| Fair Value Measurements | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Fair Value Measurements |
The Company discloses and recognizes the fair value of its assets and liabilities using a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The guidance establishes three levels of the fair value hierarchy as follows: Level 1—Quoted prices in active markets for identical assets or liabilities. Level 2—Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires management to make judgments and consider factors specific to the asset or liability. The Company recognizes transfers into and out of levels within the fair value hierarchy in the period in which the actual event or change in circumstances that caused the transfer occurs. The Company’s financial instruments consist of Level 1 and Level 2 financial instruments. Changes in the ability to observe valuation inputs may result in a reclassification of levels of certain securities within the fair value hierarchy. Level 1 financial instruments are comprised of money market funds and U.S. Treasury obligations. Level 2 financial instruments are comprised of U.S. Treasury obligations, corporate debt obligations, commercial paper, supranational debt obligations and government development bank obligations. Marketable securities are considered Level 2 when their fair values are determined using inputs that are observable in the market or can be derived principally from or corroborated by observable market data such as pricing for similar securities, recently executed transactions, cash flow models with yield curves, and benchmark securities. Recurring Fair Value Measurements The following tables present the Company’s fair value hierarchy for financial assets measured at fair value on a recurring basis as of June 30, 2026 and December 31, 2025 (in thousands):
The Company did not hold Level 3 financial instruments measured on a recurring basis and there were no transfers between Level 1 and Level 2 categories during the six months ended June 30, 2026 and 2025. Nonrecurring Fair Value Measurements During the three months ended June 30, 2026, the Company measured its acquired IPR&D intangible asset at fair value on a nonrecurring basis in connection with an impairment assessment. The fair value measurement was classified within Level 3 of the fair value hierarchy. Based on the assessment, the Company recorded an impairment loss of $41.8 million during the three and six months ended June 30, 2026. See Note 6 for additional information. |
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