Other Investments

9 Months Ended

Sep. 30, 2023

Investments, All Other Investments [Abstract]

Other Investments

Other Investments

From time to time, the Company makes minority ownership strategic investments. As of September 30, 2023 and December 31, 2022, the aggregate carrying amounts of the Company’s strategic investments in non-publicly traded companies were $32.0 million and $44.9 million, respectively. These investments are measured at initial cost, minus impairment, if any, and plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. Cumulative impairments of strategic investments in equity investments without readily determinable fair values still held as of September 30, 2023 and December 31, 2022 were $17.9 million and $5.0 million, respectively.

As a part of the acquisition of each of the Company’s other investments, the Company determines whether an investment or other interest is considered a variable interest. As of September 30, 2023 and December 31, 2022, the Company held an interest in two entities that were concluded to be variable interests for which the Company was not the primary beneficiary. As of September 30, 2023 and December 31, 2022, the carrying value and maximum exposure to loss of the Company’s variable interests were $13.0 million and $15.9 million, respectively, which is recorded in other investments in the Company’s Condensed Consolidated Balance Sheets.

In October 2022, the Company received shares of PACT’s Series D non-voting convertible preferred stock (See Note 3, License, Collaboration and Success Payment Agreements). The Company recognized its investment in PACT preferred stock at its estimated fair value of $2.9 million on October 1, 2022, which was included in the Company’s Condensed Consolidated Balance Sheet within other investments as of December 31, 2022.

For the nine months ended September 30, 2023 and the three and nine months ended September 30, 2022, the Company performed qualitative assessments of potential indicators of impairment and determined that indicators existed for certain of its other investments. The Company did not identify any impairments for the three months ended September 30, 2023. The Company did identify impairments for the nine months ended September 30, 2023 and for the three and nine months ended September 30, 2022. While there was no single event or factor in each instance, the Company considered the underlying companies’ operating cash flow requirements over the next year, liquid asset balances to fund those requirements and the underlying companies’ inability to raise funds as indicators of impairment. Due to these indicators, the Company assessed the valuation of these investments and determined the fair values to be negligible and the impairments to be other-than-temporary in nature. As a result, the Company recorded a $2.9 million impairment expense for the PACT Series D convertible preferred stock investment and a $10.0 million impairment expense for one investment for the nine months ended September 30, 2023 and $5.0 million impairment expense for one investment for the three and nine months ended September 30, 2022, which were recorded within impairment of other investments on the Condensed Consolidated Statements of Operations and Comprehensive Loss and as reductions to the investment balances within other investments on the Condensed Consolidated Balance Sheets.