v3.26.1
Fair Value Measurements
 6 Months Ended
Jun. 30, 2026
Fair Value Disclosures [Abstract]  
Fair Value Measurements

4. Fair Value Measurements

The Company classified its U.S. Treasury securities (Note 3) within Level 2 because their fair values are determined using alternative pricing sources or models that utilized market observable inputs. The Company’s convertible notes payable (Note 9) is measured as a Level 3 fair value on a recurring basis and was $203.4 million and $199.3 million as of June 30, 2026 and December 31, 2025, respectively.

The Company holds an equity investment in IsoBio. The Company originally measured the investment at cost. In October 2025, IsoBio completed a preferred stock financing with unrelated third‑party investors. The transaction represented an observable price change for an identical or other similar equity security held by the Company. Accordingly, the Company remeasured the investment to fair value and recorded an unrealized gain of $0.6 million within Other income (expense). No further observable price changes have been identified. The resulting carrying value of the IsoBio investment is $5.6 million as of June 30, 2026 and December 31, 2025. Because the valuation incorporates significant unobservable inputs, the investment is classified as a Level 3 fair value measurement.

The Company holds an equity investment in Opeongo. The Company measured the investment at cost and no observable price changes were identified. The carrying value of the Opeongo investment is $10.0 million as of June 30, 2026. Because the valuation incorporates significant unobservable inputs, the investment is classified as a Level 3 fair value measurement.

The Company holds an equity investment in ENDRA Life Sciences, Inc. ("ENDRA"). The Company measured the investment at fair value and no material observable price changes were identified. The total carrying value of the ENDRA investment is $3.8 million as of June 30, 2026. Because the valuation of the common stock and prefunded warrants incorporates observable inputs, that portion of the investment is classified as a Level 1 fair value measurement. Because the valuation of the common warrants incorporates significant unobservable inputs, that portion of the investment is classified as a Level 3 fair value measurement.

The Company holds an equity investment in Skyline. The Company measured the investment under the equity method and recorded the investment at $23.8 million as a result of the deconsolidation of Skyline during the first quarter of 2026. The Company has elected to account for the retained interest in Skyline under the fair value option (“FVO”). The carrying amount was adjusted by $1.1 million during the first quarter of 2026, resulting in a carrying amount of the Skyline investment of $24.9 million as of June 30, 2026. The Company recognized a change in fair value of investment of $0 and $1.1 million for the three and six months ended June 30, 2026 and 2025. Because the valuation incorporates observable inputs, the investment is classified as a Level 1 fair value measurement.

There were no transfers among Level 1, Level 2 or Level 3 categories in the three months ended June 30, 2026. The carrying amounts of accounts payable, accrued expenses and debt are considered to be representative of their respective fair values because of the short-term nature of those instruments.

A summary of the assets and liabilities that are measured at fair value as of June 30, 2026 and December 31, 2025 is as follows (in thousands):

 

 

 

June 30, 2026

 

 

 

Carrying Value

 

 

Quoted Price in Active Markets for Identical Assets (Level 1)

 

 

Significant Other Observable Inputs (Level 2)

 

 

Significant Unobservable Inputs (Level 3)

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury securities

 

$

35,300

 

 

$

—

 

 

$

35,300

 

 

$

—

 

Other investments (ASC 321)

 

 

44,235

 

 

 

27,989

 

 

 

—

 

 

 

16,246

 

Total

 

$

79,535

 

 

$

27,989

 

 

$

35,300

 

 

$

16,246

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

Convertible notes payable

 

 

203,351

 

 

 

—

 

 

 

—

 

 

 

203,351

 

Total

 

$

203,351

 

 

$

—

 

 

$

—

 

 

$

203,351

 

 

 

 

December 31,
2025

 

 

 

Carrying Value

 

 

Quoted Price in Active Markets for Identical Assets (Level 1)

 

 

Significant Other Observable Inputs (Level 2)

 

 

Significant Unobservable Inputs (Level 3)

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury securities

 

$

47,745

 

 

$

—

 

 

$

47,745

 

 

$

—

 

Other investments (ASC 321)

 

 

5,580

 

 

 

—

 

 

 

—

 

 

 

5,580

 

Total

 

$

53,325

 

 

$

—

 

 

$

47,745

 

 

$

5,580

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

Convertible notes payable

 

 

199,323

 

 

 

—

 

 

 

—

 

 

 

199,323

 

Total

 

$

199,323

 

 

$

—

 

 

$

—

 

 

$

199,323

 

The following table provides a reconciliation of the Company’s assets and liabilities measured as a Level 3 at fair value on a recurring basis using significant unobservable inputs (in thousands):

 

 

Convertible
Notes Payable

 

Balance as of December 31, 2024

 

$

33,433

 

Fair value at issuance

 

 

42,171

 

Fair value adjustment

 

 

123,719

 

Balance as of December 31, 2025

 

 

199,323

 

Fair value adjustment

 

 

4,028

 

Balance as of June 30, 2026

 

$

203,351