XML 38 R11.htm IDEA: XBRL DOCUMENT
v3.20.4

Fair Value Measurements | 12 Months Ended
--- | ---
Dec. 31, 2020
Fair Value Disclosures [Abstract] |
Fair Value Measurements | 3. Fair Value Measurements The Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. The Company determines fair value based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following three levels:
| • | Level 1: Observable inputs such as unadjusted quoted prices in active markets for identical assets or liabilities at the measurement date.
| • | Level 2: Inputs (other than quoted prices included in Level 1) that are either directly or indirectly observable for the asset or liability. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.
| • | 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 following tables present information about the Company’s financial assets and liabilities measured at fair value on a recurring basis and indicate the level of the fair value hierarchy utilized to determine such fair values (in thousands):
|  | December 31, 2020 |
|  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |
Current assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash equivalents: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Money market funds |  | $ | 15,677 |  |  | $ | — |  |  | $ | — |  |  | $ | 15,677 |
Corporate debt securities |  |  | — |  |  |  | 2,500 |  |  |  | — |  |  |  | 2,500 |
Commercial paper |  |  | — |  |  |  | 13,499 |  |  |  | — |  |  |  | 13,499 |
Total cash equivalents |  |  | 15,677 |  |  |  | 15,999 |  |  |  | — |  |  |  | 31,676 |
Short-term investments: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Corporate debt securities |  |  | — |  |  |  | 11,588 |  |  |  | — |  |  |  | 11,588 |
Commercial paper |  |  | — |  |  |  | 50,027 |  |  |  | — |  |  |  | 50,027 |
Total short-term investments |  |  | — |  |  |  | 61,615 |  |  |  | — |  |  |  | 61,615 |
Total assets measured at fair value |  | $ | 15,677 |  |  | $ | 77,614 |  |  | $ | — |  |  | $ | 93,291 |
|  | December 31, 2019 |
|  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |
Current assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash equivalents: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Money market funds |  | $ | 12,859 |  |  | $ | — |  |  | $ | — |  |  | $ | 12,859 |
Corporate debt securities |  |  | — |  |  |  | 500 |  |  |  | — |  |  |  | 500 |
Total cash equivalents |  |  | 12,859 |  |  |  | 500 |  |  |  | — |  |  |  | 13,359 |
Short-term investments: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Government agency bonds |  |  | — |  |  |  | 2,750 |  |  |  | — |  |  |  | 2,750 |
Corporate debt securities |  |  | — |  |  |  | 11,349 |  |  |  | — |  |  |  | 11,349 |
Commercial paper |  |  | — |  |  |  | 5,987 |  |  |  | — |  |  |  | 5,987 |
Total short-term investments |  |  | — |  |  |  | 20,086 |  |  |  | — |  |  |  | 20,086 |
Total assets measured at fair value |  | $ | 12,859 |  |  | $ | 20,586 |  |  | $ | — |  |  | $ | 33,445 |
Current liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Preferred stock tranche obligation |  | $ | — |  |  | $ | — |  |  | $ | 2,158 |  |  | $ | 2,158 |
Total liabilities measured at fair value |  | $ | — |  |  | $ | — |  |  | $ | 2,158 |  |  | $ | 2,158 |
The following tables present information as to cost, unrealized gains and losses and fair value determination of the Company’s financial assets measured at fair value on a recurring basis (in thousands):
|  | December 31, 2020 |
|  | Amortized Cost |  |  | Unrealized Gains |  |  | Unrealized Losses |  |  | Aggregate Fair Value |
Current assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash equivalents: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Money market funds |  | $ | 15,677 |  |  | $ | — |  |  | $ | — |  |  | $ | 15,677 |
Corporate debt securities |  |  | 2,502 |  |  |  | — |  |  |  | (2 | ) |  |  | 2,500 |
Commercial paper |  |  | 13,498 |  |  |  | 1 |  |  |  | — |  |  |  | 13,499 |
Total cash equivalents |  |  | 31,677 |  |  |  | 1 |  |  |  | (2 | ) |  |  | 31,676 |
Short-term investments: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Corporate debt securities |  |  | 11,588 |  |  |  | 1 |  |  |  | (1 | ) |  |  | 11,588 |
Commercial paper |  |  | 50,030 |  |  |  | 2 |  |  |  | (5 | ) |  |  | 50,027 |
Total short-term investments |  |  | 61,618 |  |  |  | 3 |  |  |  | (6 | ) |  |  | 61,615 |
Total assets measured at fair value |  | $ | 93,295 |  |  | $ | 4 |  |  | $ | (8 | ) |  | $ | 93,291 |
|  | December 31, 2019 |
|  | Amortized Cost |  |  | Unrealized Gains |  |  | Unrealized Losses |  |  | Aggregate Fair Value |
Current assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash equivalents: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Money market funds |  | $ | 12,859 |  |  | $ | — |  |  | $ | — |  |  | $ | 12,859 |
Corporate debt securities |  |  | 500 |  |  |  | — |  |  |  | — |  |  |  | 500 |
Total cash equivalents |  |  | 13,359 |  |  |  | — |  |  |  | — |  |  |  | 13,359 |
Short-term investments: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Government agency bonds |  |  | 2,750 |  |  |  | — |  |  |  | — |  |  |  | 2,750 |
Corporate debt securities |  |  | 11,348 |  |  |  | 2 |  |  |  | (1 | ) |  |  | 11,349 |
Commercial paper |  |  | 5,985 |  |  |  | 2 |  |  |  | — |  |  |  | 5,987 |
Total short-term investments |  |  | 20,083 |  |  |  | 4 |  |  |  | (1 | ) |  |  | 20,086 |
Total assets measured at fair value |  | $ | 33,442 |  |  | $ | 4 |  |  | $ | (1 | ) |  | $ | 33,445 |
Money market funds are highly liquid investments which are actively traded. The pricing information on the Company’s money market funds is based on quoted prices in active markets for identical securities. This approach results in the classification of these securities as Level 1 of the fair value hierarchy. The fair value of short-term investments is determined from market pricing and other observable market inputs for similar securities obtained from various third-party data providers. The pricing services utilize industry-standard valuation models, including both income and market-based approaches, for which all significant inputs are observable, either directly or indirectly, to estimate fair value. These inputs include reported trades of and broker/dealer quotes on the same or similar securities; issuer credit spreads; benchmark securities; prepayment/default projections based on historical data; and other observable inputs. This approach results in the classification of these securities as Level 2 of the fair value hierarchy. As of December 31, 2020 and 2019, the contractual maturities of all available-for-sale investments were less than 12 months. The Company periodically reviews the available-for-sale investments for other-than-temporary impairment loss. All investments with unrealized losses have been in a loss position for less than 12 months. As a result, the Company did not recognize any other-than-temporary impairment losses as of December 31, 2020 and 2019. In connection with the Company’s convertible preferred stock financing in July 2019, certain investors were granted an option to purchase additional shares contingent upon delivery to them of certain clinical trial results (the Preferred Stock Tranche Obligation, see Note 6). In September 2020, the board of directors and these investors amended the stock purchase agreement such that the option to purchase additional shares would no longer be exercisable and would expire upon the effectiveness of the Company’s IPO registration statement on September 24, 2020. As a result, the fair value of the Preferred Stock Tranche Obligation was remeasured as of the date of the amendment and adjusted to its fair value at that time which was deemed to be immaterial. The Preferred Stock Tranche Obligation was remeasured at fair value at each reporting period until its expiration on September 24, 2020 using an option pricing valuation methodology. Due to the low probability of the Preferred Stock Tranche Obligation being settled, the fair value immediately prior to the IPO was immaterial. The fair value of the Preferred Stock Tranche Obligation includes inputs not observable in the market and thus represents a Level 3 measurement. The option methodology utilized requires inputs based on certain subjective assumptions, including (a) expected stock price volatility, (b) calculation of an expected term, (c) a risk-free interest rate and (d) expected dividends. This approach results in the classification of this security as Level 3 of the fair value hierarchy. The assumptions utilized to fair value the Preferred Stock Tranche Obligation as of December 31, 2019 were (a) expected stock price volatility of 30%, (b) expected term of 0.7 years, (c) a risk-free interest rate of 1.6% and (d) an expectation of no dividends. The change in the fair value for the year ended December 31, 2020 was $2.2 million. The following table provides a reconciliation of Level 3 liabilities measured at fair value on a recurring basis using significant unobservable inputs (in thousands):
|  | Amount |
Fair value as of December 31, 2019 |  | $ | 2,158 |
Change in fair value and expiration of the preferred stock tranche obligation |  |  | (2,158 | )
Balance as of December 31, 2020 |  | $ | — |
There were no transfers between Levels 1, 2 or 3 for the periods presented.

X
- Definition The entire disclosure for derivatives and fair value of assets and liabilities. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -URI http://asc.fasb.org/topic&trid=2155941 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -URI http://asc.fasb.org/topic&trid=2229140 + Details
Name: | us-gaap_DerivativesAndFairValueTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_FairValueDisclosuresAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration