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Fair Value Measurement (Tables)

9 Months Ended

Sep. 30, 2021

Financial Assets and Liabilities Measured at Fair Value on Recurring Basis

The following table sets forth the fair value of the Company’s financial assets and liabilities measured at fair value on a recurring basis based on the three-tier fair value hierarchy (in thousands):

		September 30, 2021
		Level 1				Level 2				Level 3				Total
Financial assets:
Money market funds		$	331,349			$	-			$	-			$	331,349
U.S. Treasury securities			-				249,761				-				249,761
U.S. government agency securities			-				103,961				-				103,961
Corporate debt securities			-				230,704				-				230,704
Equity warrant investment			-				-				1,124				1,124
Total financial assets		$	331,349			$	584,426			$	1,124			$	916,899
Financial liabilities:
Success payment liabilities		$	-			$	-			$	25,116			$	25,116
Total financial liabilities		$	-			$	-			$	25,116			$	25,116

		December 31, 2020
		Level 1				Level 2				Level 3				Total
Financial assets:
Money market funds		$	50,513			$	-			$	-			$	50,513
U.S. Treasury securities			-				202,701				-				202,701
U.S. government agency securities			-				205,764				-				205,764
Corporate debt securities			-				211,109				-				211,109
Equity warrant investment			-				-				1,323				1,323
Total financial assets		$	50,513			$	619,574			$	1,323			$	671,410
Financial liabilities:
Success payment liabilities		$	-			$	-			$	5,773			$	5,773
Total financial liabilities		$	-			$	-			$	5,773			$	5,773

Changes in the Estimated Fair Value of Level 3 Financial Assets and Liabilities

The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial assets and liabilities (in thousands):

		Equity Warrant Investment				Success Payment Liabilities
Balance at December 31, 2020		$	1,323			$	5,773
Change in fair value (1)			(199	)			19,343
Balance at September 30, 2021		$	1,124			$	25,116

(1) The change in fair value associated with the equity warrant investment is recorded in other income (expense), net and the change in fair value associated with success payment liabilities is recorded in research and development expense.

Fred Hutch

Summary of Estimated Fair Value of Success Payment Liability Assumptions

The following assumptions were incorporated into the calculation of the estimated fair value of the Fred Hutch success payment liability:

		September 30,				December 31,
		2021				2020
Fair value of common stock (Series A convertible preferred stock)		$	14.80			$	9.07
Risk-free interest rate		0.07% - 2.24%				0.10% - 1.52%
Expected volatility			75	%			80	%
Expected term (in years)		0.71 - 6.22				1.00 - 6.97

Stanford

Summary of Estimated Fair Value of Success Payment Liability Assumptions

The following assumptions were incorporated into the calculation of the estimated fair value of the Stanford success payment liability:

		September 30,				December 31,
		2021				2020
Fair value of common stock (Series A convertible preferred stock)		$	14.80			$	9.07
Risk-free interest rate		0.07% - 2.24%				0.10% - 1.53%
Expected volatility			75	%			80	%
Expected term (in years)		0.71 - 8.00				1.00 - 8.75

X

- Definition

Tabular disclosure of input and valuation technique used to measure fair value and change in valuation approach and technique for each separate class of asset and liability measured on recurring and nonrecurring basis.

+ References

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-SubTopic 10
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- Definition

Tabular disclosure of the fair value measurement of liabilities using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets), and gains or losses recognized in other comprehensive income (loss) and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs) by class of liability.

+ References

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- Definition

Tabular disclosure of assets and liabilities, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3).

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 2
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-URI http://asc.fasb.org/extlink&oid=123874694&loc=d3e19207-110258

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