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Fair Value Measurements
 6 Months Ended
Jun. 30, 2025
Fair Value Disclosures [Abstract]  
Fair Value Measurements Fair Value Measurements
The Company measures and reports certain financial instruments as assets and liabilities at fair value on a recurring basis. The following tables set forth the fair value of the Company’s financial assets and liabilities at fair value on a recurring basis based on the three-tier fair value hierarchy (in thousands):
June 30, 2025
Level 1Level 2Level 3Total
Financial Assets:
Money market funds$79,957 $— $— $79,957 
U.S. government treasury securities221,646 — — 221,646 
U.S. government agency securities— 70,526 — 70,526 
Commercial paper— 89,178 — 89,178 
Corporate bonds— 63,571 — 63,571 
Total financial assets$301,603 $223,275 $— $524,878 
 
Liabilities:
CVR liability$— $— $59,900 $59,900 
Total liabilities$— $— $59,900 $59,900 
December 31, 2024
Level 1Level 2Level 3Total
Financial Assets:
Money market funds$65,902 $— $— $65,902 
U.S. government treasury securities227,244 — — 227,244 
U.S. government agency securities— 86,681 — 86,681 
Commercial paper— 165,130 — 165,130 
Corporate bonds— 56,448 — 56,448 
Total financial assets$293,146 $308,259 $— $601,405 
Liabilities:
CVR liability$— $— $61,700 $61,700 
Total liabilities$— $— $61,700 $61,700 
The Company measures the fair value of money market funds and U.S. government treasury securities on quoted prices in active markets for identical assets or liabilities. The Level 2 assets include U.S. government agency securities, commercial paper and corporate bonds, and are valued based on quoted prices for similar assets in active markets and inputs other than quoted prices that are derived from observable market data. The Company evaluates transfers between levels at the end of each reporting period. There were no transfers between Level 1, Level 2, or Level 3 during the periods presented.
CVR Liability
In connection with the Asset Acquisition, a non-transferable CVR was distributed to the Legacy Stockholders. Holders of the CVR will be entitled to receive certain cash payments from proceeds received by the Company for a three-year period, if any, related to the disposition or monetization of the Company’s legacy assets for a period of one year following the closing of the Asset Acquisition.
The fair value of the CVR liability was determined using the probability weighted discounted cash flow method to estimate future cash flows associated with the sale of the legacy assets. Analogous to a dividend being declared/approved in one period and paid out in another, the liability was recorded at the date of approval, June 22, 2023, as a common stock dividend, returning capital to the Legacy Stockholders. Changes in fair value of the liability will be recognized as a component of Other income (expense), net in the consolidated statement of operations and comprehensive loss in each reporting period. The liability value is based on significant inputs not observable in the market such as estimated cash flows, estimated probabilities of regulatory success, and discount rates, which represent a Level 3 measurement within the fair value hierarchy.
The significant inputs used to estimate the fair value of the CVR liability were as follows:
 June 30, 2025
Estimated cash flow dates
08/28/25 - 06/22/26
Estimated probability of success
72% - 100%
Estimated reimbursement rate compared to reimbursement target
49% - 100%
Risk-adjusted discount rates
9.38% - 9.48%
The change in fair value between December 31, 2024 and June 30, 2025 was a $1.8 million decrease, primarily driven by changes in the likelihood of achievement of certain milestones and an increase in risk-adjusted discount rates, partially offset by time value of money adjustments.
The following table presents changes in the CVR liability for the periods presented (in thousands):
 
CVR Liability
Beginning balance as of December 31, 2024$61,700 
Changes in the fair value of the CVR liability(1,800)
Payments— 
Ending Balance as of June 30, 2025$59,900