Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2021

Fair Value Assets and Liabilities Measured on Recurring Basis

The following tables summarize the Company’s financial assets and liabilities measured at fair value on a recurring basis based on the three-tier fair value hierarchy:

		December 31, 2021
	Valuation Hierarchy	Amortized Cost		Gross Unrealized Holding Gains		Gross Unrealized Holding Losses			Estimated Fair Value
		(in thousands)
Financial assets:
Cash equivalents:
Money market funds	Level 1	$	224,671	$	-	$	-		$	224,671
Corporate debt securities	Level 2		2,345		-		-			2,345
Total cash equivalents			227,016		-		-			227,016
Short-term marketable securities:
U.S. government and agency securities	Level 2		162,854		1		(195	)		162,660
Corporate debt securities	Level 2		135,441		-		(134	)		135,307
Total short-term marketable securities			298,295		1		(329	)		297,967
Long-term marketable securities:
U.S. government and agency securities	Level 2		176,492		-		(925	)		175,567
Corporate debt securities	Level 2		20,427		-		(113	)		20,314
Total long-term marketable securities			196,919		-		(1,038	)		195,881
Other assets	Level 3		426		-		-			426
Total financial assets		$	722,656	$	1	$	(1,367	)	$	721,290
Financial liabilities:
Short-term financial liabilities:
Contingent consideration	Level 3	$	51,382	$	-	$	-		$	51,382
Success payment liabilities	Level 3		5,000		-		-			5,000
Total short-term financial liabilities			56,382		-		-			56,382
Long-term financial liabilities:
Contingent consideration	Level 3		102,361		-		-			102,361
Success payment liabilities	Level 3		97,525		-		-			97,525
Total long-term financial liabilities			199,886		-		-			199,886
Total financial liabilities		$	256,268	$	-	$	-		$	256,268

		December 31, 2020
	Valuation Hierarchy	Amortized Cost		Gross Unrealized Holding Gains		Gross Unrealized Holding Losses			Estimated Fair Value
		(in thousands)
Financial assets:
Cash equivalents:
Money market funds	Level 1	$	48,359	$	-	$	-		$	48,359
U.S. government and agency securities	Level 2		40,727		1		(1	)		40,727
Corporate debt securities	Level 2		1,138		-		-			1,138
Total cash equivalents			90,224		1		(1	)		90,224
Short-term marketable securities:
U.S. government and agency securities	Level 2		244,637		30		(5	)		244,662
Corporate debt securities	Level 2		8,798		-		(2	)		8,796
Total short-term marketable securities			253,435		30		(7	)		253,458
Long-term marketable securities:
U.S. government and agency securities	Level 2		33,724		7		-			33,731
Total long-term marketable securities			33,724		7		-			33,731
Total financial assets		$	377,383	$	38	$	(8	)	$	377,413
Financial liabilities:
Long-term financial liabilities:
Contingent consideration	Level 3	$	121,901	$	-	$	-		$	121,901
Success payment liabilities	Level 3		76,494		-		-			76,494
Total financial liabilities		$	198,395	$	-	$	-		$	198,395

Changes in Estimated Fair Value of Level 3 Financial Liabilities

As of December 31, 2021 and 2020, the balance in accumulated other comprehensive income (loss) included net unrealized gains (losses) related to the Company’s available-for-sale debt securities. There were no material realized gains or losses recognized on the sale or maturity of available-for-sale securities during the years ended December 31, 2021, 2020 and 2019.

The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial liabilities:

	Contingent Consideration			Cobalt Success Payment Liability			Harvard Success Payment Liability
	(in thousands)
Balance as of December 31, 2020	$	121,901		$	64,694		$	11,800
Changes in fair value - expense (gain)		11,393			91,757			23,900
Balance as of March 31, 2021		133,294			156,451			35,700
Changes in fair value - expense (gain)		7,163			(66,632	)		(16,556	)
Balance as of June 30, 2021		140,457			89,819			19,144
Changes in fair value - expense (gain)		(8,476	)		21,790			3,439
Balance as of September 30, 2021		131,981			111,609			22,583
Changes in fair value - expense (gain)		21,762			(23,256	)		(8,411	)
Balance as of December 31, 2021	$	153,743		$	88,353		$	14,172

Cobalt Contingent Consideration Liability

Summary of Estimated Fair Value of Liabilities using Unobservable Inputs

The fair value of the Cobalt Contingent Consideration was calculated using the following unobservable inputs:

	December 31,
	2021		2020
Unobservable Input	Range	Weighted-Average	Range	Weighted-Average
Discount rates	10.9% - 11.6%	11.2%	10.5% - 10.8%	10.6%
Probability of milestone achievement	5.0% - 75.0%	33.8%	2.5% - 65.0%	27.6%

Success Payment Liabilities

Summary of Estimated Fair Value of Liabilities using Unobservable Inputs

The fair values of the Cobalt and Harvard success payments were calculated using the following unobservable inputs:

	December 31,
	2021		2020
Unobservable Input	Cobalt	Harvard	Cobalt	Harvard
Expected stock price volatility	70%	70%	70%	70%
Expected term (years)	17.1	9.2	18.1	10.2