Fair Value Measurements |
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Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements |
3. Fair Value Measurements The following table sets forth the fair value of the Company’s financial assets and liabilities measured on a recurring basis by level within the fair value hierarchy:
Where applicable, the Company uses quoted market prices in active markets for identical assets to determine fair value. This pricing methodology applies to Level 1 investments, which are comprised of money market funds, U.S. government securities and the shares of Vaxcyte common stock held by the Company. If quoted prices in active markets for identical assets are not available, then the Company uses quoted prices for similar assets or inputs other than quoted prices that are observable, either directly or indirectly. These investments are included in Level 2 and consist of commercial paper, corporate debt securities, asset-backed securities, U.S. agency securities and supranational debt securities. These assets are valued using market prices when available, adjusting for accretion of the purchase price to face value at maturity. A financial instrument’s categorization within the valuation hierarchy is based upon 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. In certain cases where there is limited activity or less transparency around inputs to valuation, securities are classified as Level 3 within the valuation hierarchy. As of December 31, 2022 and 2021, the Company did not hold any securities that were classified as Level 3 within the valuation hierarchy. Investments in Equity Securities As of December 31, 2022 and 2021, the Company held 667,780 and 1,562,879 shares, respectively, of Vaxcyte common stock with an estimated fair value of $32.0 million and $37.2 million, respectively. The Company recognized an unrealized gain (loss) of $12.1 million, $(4.5) million and $41.5 million for the years ended December 31, 2022, 2021 and 2020, respectively. The Company sold 1,058,434 shares and zero shares of Vaxcyte common stock at their fair market value during the years ended December 31, 2022 and 2021, respectively. The Company recognized a gain of $4.1 million on equity securities during the year ended December 31, 2022 which is recorded under interest and other income (expense), net, in the Statements of Operations. During the year ended December 31, 2022, the Company received 167,780 shares of Vaxcyte common stock pursuant to a letter agreement (the “ Vaxcyte Agreement”) with Vaxcyte, as a non-cash consideration with a fair value of $7.5 million at the date of the transaction. Please refer to note 5 for additional information. |