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Fair Value Measurements | 6 Months Ended
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Jun. 30, 2026
Fair Value Disclosures [Abstract] |
Fair Value Measurements | 3. Fair Value Measurements The Company categorizes its financial assets and liabilities measured and reported at fair value in the financial statements on a recurring basis based upon the level of judgment associated with the inputs used to measure their fair value. Hierarchical levels, which are directly related to the amount of subjectivity associated with the inputs used to determine the fair value of financial assets and liabilities, are as follows: •Level 1—Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. •Level 2—Inputs (other than quoted prices included in Level 1) are either directly or indirectly observable for the assets or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life. •Level 3—Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. Each major category of financial assets and liabilities measured at fair value on a recurring basis is categorized based upon the lowest level of significant input to the valuations. The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Financial instruments in Level 1 generally include US treasuries and mutual funds listed in active markets. The Company's cash and cash equivalents permit daily redemption and the fair values of these investments are based upon the quoted prices in active markets provided by the holding financial institutions. The following table shows assets and liabilities that are measured at fair value on a recurring basis and their carrying value (in millions):
| As of June 30, 2026
|  |  | Fair Value
| Carrying Value |  | Level 1 |  | Level 2 |  | Level 3
Assets |  |  |  |  |  |  |
Cash and cash equivalents | $ | 544.8 |  |  | $ | 544.8 |  |  | $ | — |  |  | $ | — |
Marketable securities | $ | 615.5 |  |  | $ | 615.5 |  |  | $ | — |  |  | $ | — |
Liabilities |  |  |  |  |  |  |
Contingent consideration | $ | 170.6 |  |  | $ | — |  |  | $ | — |  |  | $ | 170.6 |
| As of December 31, 2025
|  |  | Fair Value
| Carrying Value |  | Level 1 |  | Level 2 |  | Level 3
Assets |  |  |  |  |  |  |
Cash and cash equivalents | $ | 510.4 |  |  | $ | 510.4 |  |  | $ | — |  |  | $ | — |
Marketable securities | $ | 919.6 |  |  | $ | 919.6 |  |  | $ | — |  |  | $ | — |
Liabilities |  |  |  |  |  |  |
Contingent consideration | $ | 372.1 |  |  | $ | — |  |  | $ | — |  |  | $ | 372.1 |
During the six months ended June 30, 2026, there were purchases of $399.2 million of marketable securities and maturities of $714.0 million of marketable securities, consisting of US Treasury Bills. As of June 30, 2026, the Company held $615.5 million of available-for-sale securities. Marketable securities maturing in one year or less are classified as current assets and marketable securities maturing in more than one year are classified as non-current assets. The Company recognizes transfers between levels within the fair value hierarchy, if any, at the end of each quarter. There were no transfers in or out of Level 1, Level 2, or Level 3 during the six months ended June 30, 2026. During the six months ended June 30, 2026, new Level 1 assets were added in connection with the Company's purchase of available-for-sale securities. The Company reviews the status of each security quarterly to determine whether an other-than-temporary impairment has occurred. In making its determination, the Company considers a number of factors, including: (1) the significance of the decline; (2) whether the security was rated below investment grade; (3) failure of the issuer to make scheduled interest or principal payments; and (4) the Company's ability and intent to retain the investment for a sufficient period of time for it to recover. The Company has determined that there were no other-than-temporary impairments during the six months ended June 30, 2026. Contingent Consideration The contingent consideration liabilities arose from the acquisition of Motus Biosciences, Inc. and AlgaeneX, Inc. in August 2021 (together, the Business Acquisition). The contingent consideration liabilities consist of developmental and regulatory milestones, a priority review voucher (PRV) milestone, and net sales milestones. As of June 30, 2026, the Company was obligated to issue to Motus equityholders up to 4,610,838 shares of the Company's common stock in the aggr egate and AlgaeneX equityholders up to 368,867 shares of the Company's common stock in the aggregate upon the achievement of certain development and regulatory milestone events. The fair value of the development and regulatory milestones are estimated utilizing a probability-adjusted approach. The weighted average probability of success of the remaining development and regulatory milestones was 28% as of June 30, 2026. The development and regulatory milestones, if achieve d, will be settled in shares of the Company's common stock. As such, there is no discount rate applied in the fair value calculation. During the third quarter of 2025 and first quarter of 2026, development milestones in connection with the Motus acquisition were achieved, resulting in the issuance of 364,566 shares of the Company's common stock in October 2025 and 364,397 shares of the Company's common stock in March 2026, respectively. If the Company were to receive a PRV, the Company would be obligated to pay to the Mot us equityholders a portion of the value of the PRV, subject to certain reductions. The potential payout will be either 50% of the after tax net proceeds received by the Company from a sale of the PRV or 50% of the average of the sales prices for the last three publicly disclosed PRV sales, less certain adjustments. The fair value of the PRV milestone is estimated utilizing a probability-adjusted discounted cash flow approach. This obligation will be settled in cash. On December 20, 2024, the FDA's PRV program e xpired. As of December 31, 2025, the Company determined that the likelihood of receiving a PRV was remote and the related milestone had no fair value. On February 3, 2026, the PRV program was reauthorized. As of June 30, 2026, the Company determined that the value of the PRV milestone was $15.7 million. The contingent consideration liabilities for net sales milestones were valued using an option pricing model with Monte Carlo simulation. As of June 30, 2026, the fair value of these net sales milestones were deemed immaterial to the overall fair value of the contingent consideration. The contingent consideration liabilities have been classified as a Level 3 recurring liability as its valuation requires substantial judgment and estimation of factors that are not currently observable in the market. If different assumptions were used for the inputs to the valuation approach, the estimated fair value could be significantly different than the fair value the Company determined. Contingent consideration liabilities expected to be settled within twelve months are classified as a current liability within accounts payable and accrued liabilities. Contingent consideration liabilities expected to be settled in more than twelve months are classified as a non-current liability. As of June 30, 2026, there was no current contingent consideration outstanding, and the fair value of the non-current contingent consideration was $170.6 million. A valuation of the contingent consideration liabilities is performed quarterly with gains and losses included within change in fair value of contingent consideration in the consolidated statements of comprehensive loss. The following significant unobservable inputs were used in the valuation of the contingent consideration liabilities as of June 30, 2026 and December 31, 2025:
| Fair Value as of June 30, 2026 (in millions) | Valuation Technique | Unobservable Inputs | Values
Development and regulatory milestones | $149.2 | Probability-adjusted | Probabilities of success | 0% - 80%
PRV milestone | $15.7 | Probability-adjusted discounted cash flow | Probability of success | 23.0%
Discount rate | 21.9%
| Fair Value as of December 31, 2025 (in millions) | Valuation Technique | Unobservable Inputs | Values
Development and regulatory milestones | $366.9 | Probability-adjusted | Probabilities of success | 14% - 90%
A rollforward of the Company's valuations for the contingent consideration liabilities for the six months ended June 30, 2026 and 2025 follows (in thousands):
|  |  | Contingent Consideration (Level 3 Liabilities)
Balance as of December 31, 2024 |  |  | $ | 168,900 |
Additions |  |  | — |
Change in fair value |  |  | 77,300 |
Payments |  |  | — |
Balance as of June 30, 2025 |  |  | $ | 246,200 |
Balance as of December 31, 2025 |  |  | $ | 372,139 |
Additions |  |  | — |
Change in fair value |  |  | (146,721) |
Payments |  |  | (54,868) |
Balance as of June 30, 2026 |  |  | $ | 170,550 |
The change in fair value of contingent consideration liabilities is due to changes in factors such as the probability of achieving milestones, the Company's stock price, or certain other estimated assumptions. Payments were made in shares of the Company's common stock. Royalty Financing Agreement The fair value of the Royalty Financing Agreement at the time of the transaction was based on the Company’s estimates of future royalties expected to be paid to OrbiMed Royalty & Credit Opportunities IV, LP (OrbiMed) over the life of the arrangement, which was determined using forecasts from market data sources, which are considered Level 3 inputs. This liability is being amortized using the effective interest method over the life of the arrangement, in accordance with ASC 470, Debt and ASC 835, Interest. The Company will utilize the prospective method to account for subsequent changes in the estimated future payments to be made to OrbiMed and will update the effective interest rate on a quarterly basis. The carrying value of the Royalty Financing Agreement approximates fair value. See Note 11 - Royalty Financing Agreement for further details. Secured Senior Term Loan The carrying value of the Company's secured senior term loans are measured at amortized cost using the effective interest method and the carrying value approximates fair value. See Note 10 - Debt for further details.

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- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (bbb)(1) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 107 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-107 Reference 3: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 100 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-100 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (c)(3) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2E -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2E Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (g) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 940 -SubTopic 820 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147478119/940-820-50-1 + Details
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