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Fair Value | 6 Months Ended
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Jun. 30, 2026
Fair Value Disclosures [Abstract] |
Fair Value | 6. FAIR VALUE The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis and indicates the fair value hierarchy and the valuation techniques that the Company utilized to determine such fair value:
|  | June 30, |  |  |  |  |  |  |  |  |  |
(In thousands) |  | 2026 |  |  | Level 1 |  |  | Level 2 |  |  | Level 3 |
Assets: |  |  |  |  |  |  |  |  |  |  |  |
Cash equivalents |  | $ | 15,672 |  |  | $ | 15,672 |  |  | $ | — |  |  | $ | — |
U.S. government and agency debt securities |  |  | 80,543 |  |  |  | 79,541 |  |  |  | 1,002 |  |  |  | — |
Corporate debt securities |  |  | 99,414 |  |  |  | — |  |  |  | 99,414 |  |  |  | — |
Total |  | $ | 195,629 |  |  | $ | 95,213 |  |  | $ | 100,416 |  |  | $ | — |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |
Contingent consideration |  | $ | 136,304 |  |  |  | — |  |  |  | — |  |  |  | 136,304 |
Total |  | $ | 136,304 |  |  | $ | — |  |  | $ | — |  |  | $ | 136,304 |
|  | December 31, |  |  |  |  |  |  |  |  |  |
|  | 2025 |  |  | Level 1 |  |  | Level 2 |  |  | Level 3 |
Assets: |  |  |  |  |  |  |  |  |  |  |  |
Cash equivalents |  | $ | 18,583 |  |  | $ | 18,583 |  |  | $ | — |  |  | $ | — |
U.S. government and agency debt securities |  |  | 101,371 |  |  |  | 94,246 |  |  |  | 7,125 |  |  |  | — |
Corporate debt securities |  |  | 98,274 |  |  |  | — |  |  |  | 97,774 |  |  |  | 500 |
Total |  | $ | 218,228 |  |  | $ | 112,829 |  |  | $ | 104,899 |  |  | $ | 500 |
The Company transfers its financial assets and liabilities, measured at fair value on a recurring basis, between the fair value hierarchies at the end of each reporting period. There were no transfers of any securities between levels during the six months ended June 30, 2026. The Company’s investments classified as Level 2 within the fair value hierarchy were initially valued at the transaction price and subsequently valued, at the end of each reporting period, utilizing market-observable data. The market-observable data included reportable trades, benchmark yields, credit spreads, broker/dealer quotes, bids, offers, current spot rates and other industry and economic events. The Company validated the prices developed using the market-observable data by obtaining market values from other pricing sources, analyzing pricing data in certain instances and confirming that the relevant markets are active. At June 30, 2026, the fair value of the contingent consideration resulting from the Avadel Acquisition was $136.3 million and was recorded within “Contingent consideration” in the accompanying condensed consolidated balance sheets. T he contingent consideration was valued as a contingent liability utilizing Level 3 inputs as its fair value is based on significant inputs not observable in the market. During the three months ended June 30, 2026, the fair value of the contingent consideration increased by $26.8 million and was determined as follows: • Following receipt of positive topline results from the REVITALYZ phase 3 clinical study of LUMRYZ in IH announced in May 2026, the Company increased the probability of success of achieving the CVR Milestone from 75% to 90%; and • The fair value of the contingent consideration was estimated by applying a discount factor, calculated based on the likelihood of achievement of the CVR Milestone, from the expected time the milestone occurs to the end of the reporting period, to the estimated probability of success. The Company expects achievement of the CVR Milestone to be determined by the end of 2027 and used a discount rate of 6.18%. The change in fair value of contingent consideration during each of the three and six months ended June 30, 2026 was $26.8 million, of which the Company recorded $26.4 million related to consideration transferred within “Change in fair value of contingent consideration” and recognized share-based compensation expense of $0.4 million related to the acceleration of unvested share-based compensation awards attributable to post-combination service in the accompanying condensed consolidated statements of operations and comprehensive (loss) income. The following table is a rollforward of the fair value of the Company’s assets with fair values that were determined using Level 3 inputs at June 30, 2026:
|  | Fair Value |
(In thousands) |  | Assets |  |  | Liabilities |
Balance, January 1, 2026 |  | $ | 500 |  |  | $ | — |
Addition of contingent consideration attributable to consideration transferred |  |  | — |  |  |  | 107,713 |
Change in fair value of contingent consideration attributable to consideration transferred |  |  | — |  |  |  | 26,414 |
Addition of contingent consideration attributable to post-combination expense |  |  | — |  |  |  | 1,781 |
Change in fair value of contingent consideration attributable to post-combination expense |  |  | — |  |  |  | 396 |
Impairment of corporate debt security |  |  | (500 | ) |  |  | — |
Balance, June 30, 2026 |  | $ | — |  |  | $ | 136,304 |
The carrying amounts reflected in the accompanying condensed consolidated balance sheets for cash and cash equivalents, accounts receivable, contract assets, other current assets, accounts payable and accrued expenses, sales discounts, allowances and reserves approximate fair value due to their short-term nature. The estimated fair value of the Company’s long-term debt under its Facilities (as defined in Note 12, Long-Term Debt in these “Notes to Condensed Consolidated Financial Statements”), which was based on quoted market price indications (Level 2 in the fair value hierarchy) and which may not be representative of actual values that could have been, or will be, realized in the future, was $1,532.4 million at June 30, 2026.

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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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