Fair Value Measurements and Marketable Securities

12 Months Ended

Dec. 31, 2021

Fair Value Measurements and Marketable Securities

Fair Value Measurements and Marketable SecuritiesThe Company defines fair value as the exchange price that would be received from the sale of an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must

maximize the use of observable inputs and minimize the use of unobservable inputs. The authoritative guidance describes three levels of inputs that may be used to measure fair value:

•Level I—Observable inputs that reflect unadjusted quoted prices for identical assets or liabilities in active markets;

•Level II—Observable inputs other than Level I prices, such as unadjusted quoted prices for similar assets or liabilities in active markets, unadjusted quoted prices for identical or similar assets or liabilities 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; and

•Level III—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. These inputs are based on the Company’s own assumptions used to measure assets and liabilities at fair value and require significant management judgment or estimation.

The categorization of a financial instrument within the fair value hierarchy is based upon the lowest level of input that is significant to its fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires management to make judgments and consider factors specific to the assets or liabilities.

The Company’s financial instruments that are carried at fair value consist of Level I and Level II assets as of December 31, 2021 and 2020. The following tables summarize the Company’s cash and available-for-sale marketable securities’ amortized cost, gross unrealized gains, gross unrealized losses, and fair value by significant investment category reported as cash and cash equivalents or marketable securities as of December 31, 2021 and 2020:


(In thousands) December 31, 2021	Amortized Cost		Unrealized Gain		Unrealized Loss		Fair Value		Cash and Cash Equivalents		Marketable Securities
Cash	$	16,596	$	—	$	—	$	16,596	$	16,596	$	—
Level I
Money market funds	108,204		—		—		108,204		108,204		—
Treasury bills	89,992		1		—		89,993		15,000		74,993
U.S. government securities	94,839		—		(285)		94,554		—		94,554
Total Level I	293,035		1		(285)		292,751		123,204		169,547
Level II
Commercial paper	171,918		—		—		171,918		29,544		142,374
Corporate bonds	183,303		1		(217)		183,087		17,861		165,226
Asset-backed securities	13,749		—		(11)		13,738		—		13,738
Yankee bonds	6,693		—		(12)		6,681		—		6,681
Total Level II	375,663		1		(240)		375,424		47,405		328,019
Total	$	685,294	$	2	$	(525)	$	684,771	$	187,205	$	497,566


(In thousands) December 31, 2020	Amortized Cost		Unrealized Gain		Unrealized Loss		Fair Value		Cash and Cash Equivalents		Marketable Securities
Cash	$	22,359	$	—	$	—	$	22,359	$	22,359	$	—
Level I
Money market funds	65,723		—		—		65,723		65,723		—
Treasury bills	4,498		1		—		4,499		—		4,499
U.S. government securities	20,082		24		—		20,106		—		20,106
Total Level I	90,303		25		—		90,328		65,723		24,605
Level II
Commercial paper	56,964		—		—		56,964		5,999		50,965



Total Level II	56,964		—		—		56,964		5,999		50,965
Total	$	169,626	$	25	$	—	$	169,651	$	94,081	$	75,570

The Company did not record any impairment charges with respect to its marketable securities during the years ended December 31, 2021, 2020, and 2019.

As of December 31, 2020, the Company had debt obligations outstanding of $10.8 million under the Company’s Loan and Security Agreement, as amended, which is referred to as the Loan Agreement. As of December 31, 2020, the carrying value approximated fair value as borrowings under the Loan Agreement bore interest at variable rates, and the Company believes its credit risk quality is consistent with when the debt was originated. The Company considered the balances outstanding under the Loan Agreement to be Level II liabilities as of December 31, 2020. As of December 31, 2021, the Loan Agreement had been terminated and no amounts thereunder were outstanding. See “Note 7—Debt.”

- 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.

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