Fair Value of Financial Assets and Liabilities

3 Months Ended

Mar. 31, 2020

Fair Value of Financial Assets and Liabilities

Fair Value of Financial Assets and Liabilities

3. Fair Value of Financial Assets and Liabilities

The following tables present information about the fair value measurements of the Company’s financial assets and liabilities which are measured at fair value on a recurring and non-recurring basis, and indicate the level of the fair value hierarchy utilized to determine such fair values:

	March 31, 2020
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents	$	27,210	$	—	$	—	$	27,210
Marketable securities		—		25,013		—		25,013
Total assets	$	27,210	$	25,013	$	—	$	52,223
Liabilities:
Acquisition-related contingent consideration	$	—	$	—	$	3,435	$	3,435
Total liabilities	$	—	$	—	$	3,435	$	3,435

	December 31, 2019
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents	$	21,277	$	—	$	—	$	21,277
Marketable securities		—		39,078		—		39,078
Total assets	$	21,277	$	39,078	$	—	$	60,355
Liabilities:
Acquisition-related contingent consideration	$	—	$	—	$	1,668	$	1,668
Total liabilities	$	—	$	—	$	1,668	$	1,668

As of March 31, 2020 and December 31, 2019, the Company’s cash equivalents consisted of investments with maturities of less than three months and included a money market fund, which was valued based upon Level 1 inputs, and the Company’s marketable securities consisted of investments with maturities of more than three months and included commercial paper, corporate debt, asset-backed securities and government obligations, which were valued based upon Level 2 inputs.  In determining the fair value of its Level 2 investments, the Company relied on quoted prices for identical securities in markets that are not active. These quoted prices were obtained by the Company with the assistance of a third-party pricing service based on available trade, bid and other observable market data for identical securities.  Quarterly, the Company compares the quoted prices obtained from the third-party pricing service to other available independent pricing information to validate the reasonableness of the quoted prices provided.  The Company evaluates whether adjustments to third-party pricing is necessary and, historically, the Company has not made adjustments to quoted prices obtained from the third-party pricing service.  During the three months ended March  31, 2020 and 2019, there were no transfers between Level 1,  Level 2 and Level 3.  The increase in contingent consideration of $1,767 during the three months ended March 31, 2020 was the result of updates to the Company’s assumptions as a result of the successful completion of a Phase 1 clinical trial for ATI-450. 

As of March 31, 2020 and December 31, 2019, the fair value of the Company’s available for sale marketable securities by type of security was as follows:

	March 31, 2020
			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gain		Loss		Value
Marketable securities:
Corporate debt securities	$	3,835	$	—	$	(3)	$	3,832
Commercial paper		9,061		—		—		9,061
Asset-backed securities		2,002		—		—		2,002
U.S. government agency debt securities		10,051		67		—		10,118
Total marketable securities	$	24,949	$	67	$	(3)	$	25,013

	December 31, 2019
			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gain		Loss		Value
Marketable securities:
Corporate debt securities	$	7,815	$	2	$	—	$	7,817
Commercial paper		15,129		—		—		15,129
Asset-backed securities		8,004		4		—		8,008
U.S. government agency debt securities		8,126		1		(3)		8,124
Total marketable securities	$	39,074	$	7	$	(3)	$	39,078