v3.26.3
Fair Value Measurements
 9 Months Ended
Sep. 30, 2026
Fair Value Disclosures [Abstract]  
Fair Value Measurements Fair Value Measurements
The preparation of the Company’s unaudited interim condensed consolidated financial statements in accordance with U.S. GAAP requires certain assets and liabilities to be reflected at their fair value. Fair value is defined as the exchange price, or exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value hierarchy contains three levels of inputs that may be used to measure fair value, in accordance with ASC 820, Fair Value Measurement, the first two are considered observable and the last is considered unobservable. These levels are as follows:

●Level 1— inputs, which include unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access;

●Level 2 — inputs, which include observable inputs other than Level 1 inputs, such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities 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 asset or liability; and
●Level 3 — inputs, which include unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the underlying asset or liability. Level 3 assets and liabilities include those whose fair value measurements are determined using pricing models, discounted cash flow methodologies, or similar valuation techniques, as well as significant management judgment or estimation.

To the extent the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. Marketable securities that are classified as available-for-sale are recorded at estimated fair value and are included in Level 1 or Level 2 of the fair value hierarchy. The Company classifies its money market funds and U.S. treasury securities, which are valued based on quoted market prices in active markets with no valuation adjustment, as Level 1 assets within the fair value hierarchy. The Company classifies its commercial paper, U.S. government agency bonds and corporate bonds as Level 2 assets because they are valued using observable inputs, such as quoted prices for similar securities, reported trades, broker and dealer quotes, benchmark yields and issuer credit spreads, obtained from third-party pricing services.

The categorization of a financial instrument within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The carrying value of cash, accounts payable, accrued expenses and other current liabilities and convertible note, related party approximate fair value.


The following table summarizes the Company’s financial assets and liabilities measured at fair value on a recurring basis and their respective input levels based on the fair value hierarchy (in thousands):
September 30, 2026
Level 1Level 2Level 3Total
Assets:
Cash equivalents:
Money market funds
$40,221 $— $— $40,221 
Commercial paper— 25,955 — 25,955 
U.S. treasury securities
14,944 — — 14,944 
Total cash equivalents
55,165 25,955 — 81,120 
Short-term marketable securities:
U.S. government agency bonds— 34,886 — 34,886 
U.S. treasury securities
84,816 — — 84,816 
Commercial paper— 94,264 — 94,264 
Corporate bonds— 35,627 — 35,627 
Total short-term marketable securities
84,816 164,777 — 249,593 
Total assets subject to fair value measurements on a recurring basis$139,981 $190,732 $— $330,713 
December 31, 2025
Level 1Level 2Level 3Total
Assets:
Cash equivalents:
Money market funds
$40,320 $— $— $40,320 
U.S. treasury securities29,638 — — 29,638 
Total cash equivalents
69,958 — — 69,958 
Short-term marketable securities:
U.S. treasury securities
138,106 — — 138,106 
Total short-term marketable securities
138,106 — — 138,106 
Total assets subject to fair value measurements on a recurring basis$208,064 $— $— $208,064 
Liabilities:
Convertible note, at fair value$— $— $41,600 $41,600 
Total liabilities subject to fair value measurements on a recurring basis$— $— $41,600 $41,600 
There were no transfers between Level 1, Level 2 and Level 3 during the periods presented.
The Company elected to measure the convertible note originally issued to Exact Sciences Corporation (the “Exact Convertible Note” ) using the fair value option before its automatic conversion. On September 8, 2026, approximately $50.5 million of principal and accrued and unpaid interest under the Exact Convertible Note automatically converted into 3,364,814 shares of the Company’s common stock at a conversion price of $15.00 per share. Accordingly, the Exact Convertible Note was not outstanding or subject to fair value measurement as of September 30, 2026.

The significant unobservable inputs used in the valuation of the Exact Convertible Note as of December 31, 2025 included the following:

December 31, 2025
Estimated Stock Price
$2.44 
Credit Spread8.9%

During the nine months ended September 30, 2026, the fair value of the Exact Convertible Note increased by $12.2 million. Of this amount, $11.7 million was recognized as a convertible note remeasurement loss, including the remeasurement immediately prior to note’s conversion on September 8, 2026 and is included in convertible note remeasurement loss, and $0.5 million of interest accrued through the conversion date was included in interest expense in the condensed consolidated statements of operations. The remeasurement immediately prior to conversion was based on the quoted share price of the Company’s common stock of $15.99 on September 8, 2026, applied to the 3,364,814 shares issued upon conversion. The increase primarily reflects the appreciation in the Company’s stock price following the Business Combination.

The change in the fair value of the Exact Convertible Note is summarized in the following table for the nine months ended September 30, 2026 (in thousands):

Balance at December 31, 2025$41,600 
Change in fair value included in convertible note remeasurement loss11,731 
Accrued interest included in interest expense472 
Conversion into common stock(53,803)
Balance at September 30, 2026$—