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Fair Value Measurement | 3 Months Ended
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Mar. 31, 2024
Fair Value Disclosures [Abstract] |
Fair Value Measurement | 4. Fair Value Measurement The Company measures its financial assets and liabilities at fair value, which is defined as the exit price, or the amount that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company uses the following three-level valuation hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs to value its financial assets and liabilities: •Level 1 — Observable inputs such as unadjusted quoted prices in active markets for identical instruments. •Level 2 — Quoted prices for similar instruments in active markets or inputs that are observable for the asset or liability, either directly or indirectly. •Level 3 — Significant unobservable inputs based on the Company’s assumptions. Financial Instruments Measured on a Recurring Basis The following tables provide a summary of the assets and liabilities that are measured at fair value on a recurring basis as of March 31, 2024 and December 31, 2023:
| Fair Value Measurements as of March 31, 2024
(in thousands) | Level 1 |  | Level 2 |  | Level 3 |  | Total
Cash equivalents: |  |  |  |  |  |  |
Money market funds | $ | 12,589 |  |  | $ | — |  |  | $ | — |  |  | $ | 12,589 |
Total cash equivalents | $ | 12,589 |  |  | $ | — |  |  | $ | — |  |  | $ | 12,589 |
Short-term investments: |  |  |  |  |  |  |
Government and agency securities | $ | 48,099 |  |  | $ | — |  |  | $ | — |  |  | $ | 48,099 |
Asset-backed securities | — |  |  | 1,848 |  |  | — |  |  | 1,848 |
Total short-term investments | $ | 48,099 |  |  | $ | 1,848 |  |  | $ | — |  |  | $ | 49,947 |
Liabilities: |  |  |  |  |  |  |
Current contingent liabilities | $ | — |  |  | $ | — |  |  | $ | 891 |  |  | $ | 891 |
Long-term contingent liabilities | — |  |  | — |  |  | 3,178 |  |  | 3,178 |
Total contingent liabilities | $ | — |  |  | $ | — |  |  | $ | 4,069 |  |  | $ | 4,069 |
| Fair Value Measurements as of December 31, 2023
(in thousands) | Level 1 |  | Level 2 |  | Level 3 |  | Total
Cash equivalents: |  |  |  |  |  |  |
Money market funds | $ | 12,289 |  |  | $ | — |  |  | $ | — |  |  | $ | 12,289 |
Total cash equivalents | $ | 12,289 |  |  | $ | — |  |  | $ | — |  |  | $ | 12,289 |
Short-term investments: |  |  |  |  |  |  |
Government and agency securities | $ | 63,109 |  |  | $ | 4,998 |  |  | $ | — |  |  | $ | 68,107 |
Asset-backed securities | — |  |  | 2,518 |  |  | — |  |  | 2,518 |
Total short-term investments | $ | 63,109 |  |  | $ | 7,516 |  |  | $ | — |  |  | $ | 70,625 |
Liabilities: |  |  |  |  |  |  |
Current contingent liabilities | $ | — |  |  | $ | — |  |  | $ | 1,303 |  |  | $ | 1,303 |
Long-term contingent liabilities | — |  |  | — |  |  | 3,203 |  |  | 3,203 |
Total contingent liabilities | $ | — |  |  | $ | — |  |  | $ | 4,506 |  |  | $ | 4,506 |
The carrying amounts reported in the Company’s condensed consolidated balance sheets for accounts receivable, other assets, accounts payable and other accrued expenses and other current liabilities approximate fair value due to their relatively short periods to maturity. Available-for-Sale Securities The Company obtains the fair value of its Level 2 available-for-sale securities from third-party pricing services. The pricing services utilize industry standard valuation models whereby all significant inputs, including benchmark yields, reported trades, broker/dealer quotes, issuer spreads, bids, offers, or other market-related data, are observable. The Company validates the prices provided by the third-party pricing services by reviewing their pricing methods and obtaining market values from other pricing sources. The Company did not adjust or override any fair value measurements provided by these pricing services as of March 31, 2024 or December 31, 2023. The Company has not transferred any investment securities between classification levels. Contingent Liabilities Contingent liabilities are measured at fair value each reporting period by using a probability weighted income approach. A reconciliation of the Level 3 financial instruments as of March 31, 2024 and December 31, 2023 is as follows:
(in thousands) | Icagen(1) |  | Taurus(2) |  | xCella(2) |  | Total
Balance as of January 1, 2023 | $ | 4,747 |  |  | $ | 1,600 |  |  | $ | 1,764 |  |  | $ | 8,111 |
Payments to CVR holders | (300) |  |  | (1,600) |  |  | (2,840) |  |  | (4,740) |
Fair value adjustments to contingent liabilities | (341) |  |  | 400 |  |  | 1,076 |  |  | 1,135 |
Balance as of December 31, 2023 | 4,106 |  |  | 400 |  |  | — |  |  | 4,506 |
Payments to CVR holders | (75) |  |  | (400) |  |  | — |  |  | (475) |
Fair value adjustments to contingent liabilities | 38 |  |  | — |  |  | — |  |  | 38 |
Balance as of March 31, 2024 | $ | 4,069 |  |  | $ | — |  |  | $ | — |  |  | $ | 4,069 |
_____________ (1)Changes in the fair values of contingent liabilities in connection with the acquisition of Icagen are recognized in “Other operating expense, net” in the condensed consolidated statements of operations and in the operating section of the statements of cash flows. Payments to CVR holders are disclosed in the financing section of the statements of cash flows. (2)Changes in the fair values of contingent liabilities in connection with the acquisitions of Taurus and xCella are recognized in “Intangible assets, net” in the condensed consolidated balance sheets. Payments to CVR holders are disclosed in the investing section of the statement of cash flows. Contingent liabilities are classified as Level 3 liabilities as their valuation requires substantial judgment and estimation of factors that are not currently observable in the market. These subjective estimates include but are not limited to assumptions involving the achievement probability of certain developmental and commercialization milestones, discount rates, and projected years of payments. If different assumptions were used for the various inputs to the valuation approaches, the estimated fair value could be materially higher or lower than the fair value determined. Assets Measured on a Non-Recurring Basis The Company applies fair value techniques on a non-recurring basis associated with valuing potential impairment losses related to goodwill, finite-lived intangible assets, and long-lived assets. No such fair value impairment was recognized during the three months ended March 31, 2024 or year ended December 31, 2023.

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- 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. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482106/820-10-50-2 + Details
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