Fair Value Measurements

9 Months Ended

Sep. 30, 2024

Fair Value Disclosures [Abstract]

Fair Value Measurements

3. Fair Value Measurements

The following tables represent the Company’s fair value hierarchy for financial assets and financial liabilities measured at fair value on a recurring basis as of September 30, 2024 and December 31, 2023 (in thousands):

	Basis for Fair Value Measurements						Fair Value as of
	Level 1		Level 2		Level 3		September 30, 2024
Assets
Money market funds	$	160,546	$	—	$	—	$	160,546
Certificates of deposit		—		55,872		—		55,872
Commercial paper		—		86,712		—		86,712
Corporate bonds		—		213,848		—		213,848
U.S. Treasuries		—		6,700		—		6,700
Total	$	160,546	$	363,132	$	—	$	523,678
Liabilities
Derivative liability	$	—	$	—	$	396	$	396
Total	$	—	$	—	$	396	$	396

	Basis for Fair Value Measurements						Fair Value as of
	Level 1		Level 2		Level 3		December 31, 2023
Assets
Money market funds	$	217,644	$	—	$	—	$	217,644
Commercial paper		—		18,243		—		18,243
Corporate bonds		—		28,939		—		28,939
U.S. government sponsored agencies		—		2,896		—		2,896
Total	$	217,644	$	50,078	$	—	$	267,722
Liabilities
Derivative liability	$	—	$	—	$	369	$	369
Total	$	—	$	—	$	369	$	369

Level 3 Inputs

The fair value of the derivative liability is based on significant inputs not observable in the market, which represent a Level 3 measurement within the fair value hierarchy. The fair value of the derivative liability was determined using a present value analysis with multiple scenarios. In determining the fair value of the derivative liability, the inputs impacting fair value include the change of control payment to Cystic Fibrosis Foundation, the probability of a change of control event, the product status at time of a change of control event and the discount rate. See Note 15 for further discussion on the embedded derivative.

There were no transfers between Level 1, 2 and 3 during the periods presented.

The following tables set forth a summary of the changes in the fair value of the Company’s Level 3 financial instrument during the nine months ended September 30, 2024 and 2023 (in thousands):

	Derivative Liability
Balance as of December 31, 2023	$	369
Change in fair value included in other income (expense), net		27
Balance as of September 30, 2024	$	396

	Derivative Liability
Balance as of December 31, 2022	$	212
Change in fair value included in other income (expense), net		157
Balance as of September 30, 2023	$	369