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Fair Value of Financial Instruments
 9 Months Ended
Sep. 30, 2024
Fair Value Disclosures [Abstract]  
Fair Value of Financial Instruments Fair Value of Financial Instruments
The carrying amount of certain of the Company’s financial instruments, including cash and cash equivalents, net accounts receivable, note receivable, accounts payable and other accrued liabilities approximate fair value due to their short-term nature.
The Company measures the value of its equity investments without readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or similar investment.
Assets and Liabilities Measured at Fair Value on a Recurring Basis
The Company evaluates its financial assets and liabilities subject to fair value measurements on a recurring basis to determine the appropriate level in which to classify them for each reporting period. This determination requires significant judgments. The following table summarizes the conclusions reached regarding fair value measurements as of September 30, 2024 and December 31, 2023 (in thousands):
Balance at September 30, 2024Quoted Prices in Active
Markets for Identical Assets
(Level 1)		Significant Other Observable
Inputs
(Level 2)		Significant Unobservable Inputs
(Level 3)
Liabilities:
Warrant liability, related party (1)(2)
$82 $— $— $82 
Warrant liability$44 $— $— $44 
Total$126 $— $— $126 
Balance at December 31, 2023Quoted Prices in Active
Markets for Identical Assets
(Level 1)		Significant Other Observable
Inputs
(Level 2)		Significant Unobservable Inputs
(Level 3)
Liabilities:
Warrant liability, related party (1)
$110 $— $— $110 
Total$110 $— $— $110 
_____________________________
(1)Fair value determined using the Black-Scholes option pricing model. Expected volatility is based on the historical volatility of the Company’s common stock over the most recent period. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of valuation.
(2)
CinRx is no longer deemed to be a related party. As a result the CinRx Warrants are no longer included.
Changes in Level 3 instruments for the nine months ended September 30, 2024
Balance at January 1, 2024Net Change in
fair value included in
earnings		Purchases /
Issuance		Sales /
Repurchases		ReclassBalance at September 30, 2024
2024
Warrant liability, related party (1)
$110 $173 $— $— $(201)$82 
Warrant liability $— $(157)$— $— $201 $44 
Total$110 $16 $— $— $— $126 
2023
Warrant liability, related party$684 $(406)$— $— $— $278 
Total$684 $(406)$— $— $— $278 
(1)
CinRx is no longer deemed to be a related party. As a result the CinRx Warrants are no longer included.
There were no transfers into or out of level 3 instruments and/or between level 1 and level 2 instruments during the three and nine months ended September 30, 2024. Gains and losses recognized due to the change in fair value of the warrant liability, related party are recognized as a component of other income (expense), related party in the Company’s Condensed Consolidated Statements of Operations.
The fair value of the Letter Agreement Warrants was determined using the Black-Scholes option pricing model or option pricing models based on the Company’s current capitalization. Expected volatility is based on the historical volatility of the Company’s common stock over the most recent period. The risk-free rate is based on the U.S. Treasury yield curve in
effect at the time of valuation. Significant inputs utilized in the valuation of the Letter Agreement Warrants as of September 30, 2024 and December 31, 2023, were:
September 30, 2024December 31, 2023
RangeWeighted AverageRangeWeighted Average
Expected volatility
95.13% - 124.70%
109.42%
79.96% - 89.61%
81.55%
Risk-free interest rate
3.64% - 4.85%
3.79%
4.01% - 4.87%
4.15%
The fair value of the CinRx Warrants was determined using the Black-Scholes option pricing model. Expected volatility is based on the historical volatility of the Company’s common stock over the most recent period. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of valuation. Significant inputs utilized in the valuation of the CinRx Warrants as of September 30, 2024, were:
Expected volatility 98.2 %
Expected life of options in years2.75
Risk-free interest rate3.6 %
Expected dividend yield— %
The weighted average expected volatility and risk-free interest rate was based on the relative fair values of the warrants.
Changes in the unobservable inputs noted above would impact the amount of the liability for the Letter Agreement Warrants and CinRx Warrants. Increases (decreases) in the estimates of the Company’s annual volatility would increase (decrease) the liability and an increase (decrease) in the annual risk-free rate would increase (decrease) the liability.