Quarterly report pursuant to Section 13 or 15(d)

Fair Value Measurements

v3.20.2
Fair Value Measurements
 9 Months Ended
Sep. 30, 2020
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:

 

 

 

September 30, 2020

 

 

 

Total

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

 

(in thousands)

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Money market funds

 

$

63,893

 

 

$

63,893

 

 

$

–

 

 

$

–

 

Commercial paper

 

 

40,182

 

 

 

–

 

 

 

40,182

 

 

 

–

 

Corporate debt securities

 

 

42,480

 

 

 

–

 

 

 

42,480

 

 

 

–

 

Equity securities

 

 

78,872

 

 

 

–

 

 

 

78,872

 

 

 

–

 

Asset-backed securities

 

 

8,647

 

 

 

–

 

 

 

8,647

 

 

 

–

 

U.S. government agency securities

 

 

46,681

 

 

 

–

 

 

 

46,681

 

 

 

–

 

Total

 

$

280,755

 

 

$

63,893

 

 

$

216,862

 

 

$

–

 

 

 

The following table sets forth the fair value of the Company’s financial assets and liabilities measured on a recurring basis by

 

 

December 31, 2019

 

 

 

Total

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

 

(in thousands)

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Money market funds

 

$

3,151

 

 

$

3,151

 

 

$

–

 

 

$

–

 

Commercial paper

 

 

4,952

 

 

 

–

 

 

 

4,952

 

 

 

–

 

Corporate debt securities

 

 

69,499

 

 

 

–

 

 

 

69,499

 

 

 

–

 

Asset-backed securities

 

 

27,055

 

 

 

–

 

 

 

27,055

 

 

 

–

 

U.S. government agency securities

 

 

27,007

 

 

 

–

 

 

 

27,007

 

 

 

–

 

Total

 

$

131,664

 

 

$

3,151

 

 

$

128,513

 

 

$

–

 

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.

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 and U.S. government agency securities. These assets are valued using market prices when available, adjusting for accretion of the purchase price to face value at maturity. The Company’s equity securities represent Vaxcyte common stock shares and are classified as Level 2 while subject to certain restrictions on sale. These assets are valued using market prices with a DLOM being applied, which is a Level 2 input.

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.