Fair Value Measurements

3 Months Ended

Mar. 31, 2022

Note 3. Fair value measurements

The following tables summarize the Company’s financial assets measured at fair value on a recurring basis and their respective input levels based on the fair value hierarchy (in thousands):


			Fair value measurements as of March 31, 2022 using
			Quoted prices in		Significant		Significant
			active markets		other		unobservable
	March 31,		for identical		observable		inputs
	2022		assets (level 1)		inputs (level 2)		(level 3)
Assets:
Money market funds(1)	$	327,872	$	327,872	$	—	$	—
Corporate debt securities(1)		1,450		—		1,450		—
US treasury securities(2)		33,822		33,822		—		—
Corporate debt securities(2)		1,305		—		1,305		—
Commercial paper(2)		24,059		—		24,059		—
US treasury securities(3)		29,224		29,224		—		—
Total fair value of assets	$	417,732	$	390,918	$	26,814	$	—

(1)

Included as cash and cash equivalents on the condensed consolidated balance sheets.

(2)

Included as short-term marketable securities on the condensed consolidated balance sheets.

(3)

Included as long-term marketable securities on the condensed consolidated balance sheets.


			Fair value measurements as of December 31, 2021 using
			Quoted prices in		Significant		Significant
			active markets		other		unobservable
	December 31,		for identical		observable		inputs
	2021		assets (level 1)		inputs (level 2)		(level 3)
Assets:
Money market funds(1)	$	351,625	$	351,625	$	—	$	—
US treasury securities(2)		18,097		18,097		—		—
Corporate debt securities(2)		2,822		—		2,822		—
Commercial paper(2)		31,566		—		31,566		—
Supranational debt securities(2)		1,503		—		1,503		—
US treasury securities(3)		44,770		44,770		—		—
Total fair value of assets	$	450,383	$	414,492	$	35,891	$	—

(1)

Included as cash and cash equivalents on the condensed consolidated balance sheets.

(2)

Included as short-term marketable securities on the condensed consolidated balance sheets.

(3)

Included as long-term marketable securities on the condensed consolidated balance sheets.

The carrying amounts of the Company’s financial instruments, including cash, prepaid and other current assets, accounts payable, and accrued expenses and other current liabilities, approximate fair value due to their short maturities. As of March 31, 2022, the Company has recorded a $2.0 million equity investment in Affini-T Therapeutics, Inc. at cost, subject to impairment in accordance with ASC 321, Investments—Equity Securities. None of the Company’s non-financial assets or liabilities are recorded at fair value on a non-recurring basis. No transfers between levels have occurred during the periods presented.

Cash equivalents consist of money market funds and corporate debt securities, short-term marketable securities consist of US treasury securities, corporate debt securities, commercial paper and supranational debt securities, and long-term marketable securities consist of US treasury securities. The Company obtains pricing information from its investment manager and generally determines the fair value of marketable securities using standard observable inputs, including reported trades, broker/dealer quotes, and bid and/or offers.

- 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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