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Fair Value Measurements and Fair Value of Financial Instruments
 9 Months Ended
Sep. 30, 2022
Fair Value Disclosures [Abstract]  
Fair Value Measurements and Fair Value of Financial Instruments Fair Value Measurements and Fair Value of Financial Instruments
The authoritative guidance on the fair value hierarchy for disclosure of fair value measurements is as follows:
Level 1:    Quoted prices in active markets for identical assets or liabilities.
Level 2:    Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3:    Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
The fair value of Level 1 securities is determined using quoted prices in active markets for identical assets. Level 1 securities consist of highly liquid money market funds. Financial assets and liabilities are considered Level 2 when their fair values are determined using inputs that are observable in the market or can be derived principally from or corroborated by observable market data such as pricing for similar securities, recently executed transactions, cash flow models with yield curves, and benchmark securities. In addition, Level 2 financial instruments are valued using comparisons to like-kind financial instruments and models that use readily observable market data as their basis. U.S. government and agency securities, commercial paper, and corporate bonds are valued primarily using market prices of comparable securities, bid/ask quotes, interest rate yields and prepayment spreads and are included in Level 2.
The following is a summary of the Company’s cash equivalents and short-term investments:
September 30, 2022
Amortized
Cost Basis
Unrealized
Gains
Unrealized
Losses
Estimated
Fair Value
(In thousands)
Level 1:
Money market funds
$10,074 $— $— $10,074 
Level 2:
U.S. government and agency securities
81,323 2 (1,165)80,160 
Commercial paper
99,867 — (294)99,573 
Corporate bonds
2,059 — (49)2,010 
Total cash equivalents and short-term investments193,323 2 (1,508)191,817 
Less: cash equivalents
(72,987)(2)6 (72,983)
Total short-term investments$120,336 $— $(1,502)$118,834 

December 31, 2021
Amortized
Cost Basis
Unrealized
Gains
Unrealized
Losses
Estimated
Fair Value
(In thousands)
Level 1:
Money market funds$10,311 $— $— $10,311 
Level 2:
U.S. government and agency securities62,268 — (218)62,050 
Commercial paper177,215 1 (61)177,155 
Corporate bonds47,323 — (39)47,284 
Total cash equivalents and short-term investments297,117 1 (318)296,800 
Less: cash equivalents(25,808)— 1 (25,807)
Total short-term investments$271,309 $1 $(317)$270,993 
As of September 30, 2022, $9.6 million of marketable securities have a remaining maturity between one and two years. The remainder of the marketable securities have a remaining maturity of less than one year. Management regularly reviews all of the Company’s investments for other-than-temporary declines in estimated fair value. The aggregate fair value of the marketable securities in an unrealized loss position as of September 30, 2022 was $167.9 million, which are highly liquid funds with high credit ratings that have final maturity of less than two years from date of purchase. Management determined that the gross unrealized losses on the Company’s marketable securities as of September 30, 2022 were temporary. The Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases. Management concluded that none of the Company’s marketable securities were other-than-temporarily impaired as of September 30, 2022.
During the nine months ended September 30, 2022, the Company performed an impairment test to measure certain laboratory equipment at fair value. The assets are measured at fair value using Level 3 inputs on a non-recurring basis as a result of the occurrence of certain triggering events indicating the carrying value of the assets may not be recoverable. Refer to Note 4, Balance Sheet Components for additional information.