FAIR VALUE MEASUREMENTS

3 Months Ended

Mar. 31, 2023

The Company measures certain financial assets and liabilities at fair value in accordance with the policy described in Note 1 – Business Overview and Significant Accounting Policies to the Company’s Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.

The following tables present the classification within the fair value hierarchy of financial assets and liabilities not disclosed elsewhere in these Condensed Consolidated Financial Statements that are remeasured on a recurring basis as of March 31, 2023 and December 31, 2022. Other than the Company’s fixed-rate convertible debt disclosed in Note 6 – Debt, there were no financial assets or liabilities that were remeasured using a quoted price in active markets for identical assets (Level 1) as of March 31, 2023 or December 31, 2022.


	Fair Value Measurements as of March 31, 2023
		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Assets:
Other current assets:
NQDC Plan assets		$	1,948	$	—	$	1,948
Other assets:
NQDC Plan assets		23,958		—		23,958
Restricted investments (1)		2,366		—		2,366
Total other assets		26,324		—		26,324
Total assets		$	28,272	$	—	$	28,272
Liabilities:
Current liabilities:
NQDC Plan liability		$	1,948	$	—	$	1,948


Other long-term liabilities:
NQDC Plan liability		23,958		—		23,958


Total liabilities		$	25,906	$	—	$	25,906


	Fair Value Measurements as of December 31, 2022
	Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Assets:
Other current assets:
NQDC Plan assets	$	2,654	$	—	$	2,654
Other assets:
NQDC Plan assets	19,867		—		19,867
Restricted investments (1)	2,429		—		2,429

Total other assets	22,296		—		22,296
Total assets	$	24,950	$	—	$	24,950
Liabilities:
Current liabilities:
NQDC Plan liability	$	2,654	$	—	$	2,654
Contingent consideration	—		15,925		15,925
Total current liabilities	2,654		15,925		18,579
Other long-term liabilities:
NQDC Plan liability	19,867		—		19,867


Total liabilities	$	22,521	$	15,925	$	38,446

(1) The restricted investments at March 31, 2023 and December 31, 2022 secure the Company's irrevocable standby letters of credit obtained in connection with certain commercial agreements.

There were no transfers between levels during the three months ended March 31, 2023.

Liabilities measured at fair value using Level 3 inputs consisted of contingent consideration. The following table represents a roll-forward of contingent consideration.


Contingent consideration as of December 31, 2022	$	15,925
Milestone payments to Ares Trading S.A. (Merck Serono)	(16,255)
Realized foreign exchange loss on settlement of contingent consideration	330


Contingent consideration as of March 31, 2023	$	—

- 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.

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