Fair Value Measurements

12 Months Ended

Dec. 31, 2021

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value MeasurementsAuthoritative guidance on fair value measurements defines fair value, and provides a consistent framework for measuring fair value and for disclosures of each major asset and liability category measured at fair value on either a recurring or a nonrecurring basis. Fair value is intended to reflect an assumed exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the authoritative guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

Level 1:	Observable inputs such as unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.
Level 2:	Inputs, other than quoted prices in active markets, that are observable either directly or indirectly for substantially the full term of the asset or liability.
Level 3:	Unobservable inputs in which there is little or no market data and that are significant to the fair value of the assets or liabilities, which require the reporting entity to develop its own valuation techniques that require input assumptions.

The following table presents information about the Company’s financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2021 and 2020, and indicates the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair value (in thousands):

	Fair Value Measurements at December 31, 2021
	Total		Level 1		Level 2		Level 3
Assets
Cash equivalents (1)	$	48,286	$	48,286	$	—	$	—
U.S. Treasury securities	221,724		221,724		—		—
Commercial paper	218,381		—		218,381		—
U.S. Government-sponsored enterprises	50,686		—		50,686		—
Corporate debt securities	58,836		—		58,836		—
Supranational bonds	3,003		—		3,003		—
Total assets	$	600,916	$	270,010	$	330,906	$	—
Liabilities
Common stock warrants	$	147	$	—	$	—	$	147
Total liabilities	$	147	$	—	$	—	$	147

	Fair Value Measurements at December 31, 2020
	Total		Level 1		Level 2		Level 3
Assets
Cash equivalents (1)	$	87,300	$	87,300	$	—	$	—
U.S. Treasury securities	143,254		143,254		—		—
Commercial paper	108,896		—		108,896		—
U.S. Government-sponsored enterprises	52,350		—		52,350		—
Corporate debt securities	85,823		—		85,823		—
Total assets	$	477,623	$	230,554	$	247,069	$	—
Liabilities
Common stock warrants	$	14,261	$	—	$	—	$	14,261
Total liabilities	$	14,261	$	—	$	—	$	14,261

(1)Generally, cash equivalents include money market funds and investments with a maturity of three months or less from the date of purchase.

The Company’s Level 2 financial instruments are valued using market prices on less active markets with observable valuation inputs such as interest rates and yield curves. The Company obtains the fair value of Level 2 financial instruments from quoted market prices, calculated prices or quotes from third-party pricing services. The Company validates these prices through independent valuation testing and review of portfolio valuations provided by the Company’s investment managers.

The Company's Level 3 liabilities at December 31, 2021 and 2020 included the remaining Series A warrants issued by the Company in connection with the public offering of common stock in October 2017. The Series A warrants, which expire in October 2022, provide holders the right to purchase shares of the Company’s common stock at an exercise price of $3.50 per share. As of December 31, 2021 and 2020, there were Series A warrants outstanding to purchase 1,000 shares and 154,700 shares, respectively, of the Company’s common stock (see Note 8, “Stockholders’ Equity”).

The Company reassesses the fair value of the outstanding Series A warrants at each reporting date utilizing a Black-Scholes pricing model. Variables used in the pricing model include the closing market price of the Company’s common stock at the balance sheet date, as well as estimated stock price volatility, dividend yield, remaining warrant term and risk-free interest rate. A significant increase (decrease) in any of these inputs in isolation, particularly the market price of the Company’s common stock, would have resulted in a significantly higher (lower) fair value measurement. The assumptions used to estimate the fair values of the outstanding Series A warrants at December 31, 2021 and 2020 are presented below:

	Series A Warrants
	December 31, 2021		December 31, 2020
Risk-free interest rate	0.3	%	0.1	%
Expected dividend yield	0.0%		0.0%
Expected volatility	39.1	%	55.3	%
Expected term (in years)	0.8		1.8

The following table presents a summary of changes in the fair value of the Company’s Level 3 financial liabilities for the years ended December 31, 2021 and 2020:

	2021		2020
Balance at beginning of year	$	14,261	$	23,509
Loss recognized from the change in fair value of common stock warrants	1,386		17,087
Common stock warrants exercised during the period	(15,500)		(26,335)
Balance at end of year	$	147	$	14,261

Of the loss recognized from the change in fair value of common stock warrants for the years ended December 31, 2021 and 2020, $0.1 million and $5.5 million, respectively, was attributable to warrants outstanding as of December 31, 2021 and 2020.