Fair Value Measurements and Marketable Securities Available-for-Sale

12 Months Ended

Dec. 31, 2021

Fair Value Disclosures [Abstract]

Fair Value Measurements and Marketable Securities Available for Sale

NOTE 4. FAIR VALUE MEASUREMENTS AND MARKETABLE SECURITIES

The Company provides disclosure of financial assets and financial liabilities that are carried at fair value based on the price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements may be classified based on the amount of subjectivity associated with the inputs to fair valuation of these assets and liabilities using the following three levels:

Level 1 — Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.

Level 2 — Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (i.e., interest rates, yield curves, etc.) and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs).

Level 3 — Unobservable inputs that reflect the Company’s estimates of the assumptions that market participants would use in pricing the asset or liability. The Company develops these inputs based on the best information available, including its own data.

The following table presents information about the Company’s marketable securities as of December 31, 2021 and 2020 and the Warrant liability as of December 31, 2021, measured at fair value on a recurring basis, and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value. The Company’s Warrant liabilities are included within the Level 1 and Level 3 fair value hierarchy. The fair value of the Public and Forward Purchase Warrants is determined using the closing price of the warrants on the NYSE market. The fair value of the Private Placement Warrants is determined using the Black-Scholes option pricing formula. The primary unobservable input utilized in determining the fair value of the Private Warrants is the expected volatility. The expected volatility was estimated considering observable Nuvation public warrant pricing, Nuvation’s own historical volatility and the volatility of guideline public companies. There have not been any transfers between the levels during the periods.

	December 31, 2021
	Total		Level 1		Level 2		Level 3
	(In thousands)
Financial assets:
Cash equivalents:
Money market funds	$	53,292	$	53,292	$	—	$	—
Commercial paper		30,845		—		30,845		—
Corporate bonds		571		—		571		—
		84,708		53,292		31,416		—
Marketable securities:
Certificate of deposits		3,000				3,000		—
Commercial paper		16,892				16,892		—
U.S government and government agency securities		267,267				267,267		—
Corporate bonds		320,192				320,192		—
Municipal bonds		10,821				10,821		—
Exchange traded fund		14,797		14,797		—		—
		632,969		14,797		618,172		—
Total financial assets:	$	717,677	$	68,089	$	649,588	$	—
Financial liabilities:
Warrants	$	11,037	$	10,631			$	406

	December 31, 2020
	Total		Level 1		Level 2		Level 3
	(In thousands)
Cash equivalents:
Money market funds	$	400	$	400	$	—	$	—
U.S government and government agency securities		9,999		—		9,999		—
		10,399		400		9,999		—
Marketable securities:
U.S government and government agency securities		98,180		—		98,180		—
Corporate bonds		87,817		—		87,817		—
		185,997		—		185,997		—
Total financial assets	$	196,396	$	400	$	195,996	$	—

Marketable securities consist; U.S. government and government agency, certificate of deposits, commercial paper, corporate bond and municipal securities ("Debt Securities") and an exchange traded fund that primarily owns fixed income securities. Based on the Company’s intentions regarding its marketable securities, all Debt Securities are classified as available-for-sale and are carried at fair value based on the price that would be received upon sale of the security. All marketable securities in unrealized loss positions as of December 31, 2021 have been in such position

for less than 12 continuous months. The following table provides the amortized cost, aggregate fair value, and unrealized gains (losses) of marketable securities as of December 31, 2021 and December 31, 2020:

	December 31, 2021
	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
	(In thousands)
Cash equivalents:
Money market funds	$	53,292	$	—	$	—		$	53,292
Commercial paper		30,845		—		—			30,845
Corporate bonds		571		—		—			571
		84,708		—		—			84,708
Marketable securities:
Certificate of deposits		3,000		—		—			3,000
Commercial paper		16,889		3		—			16,892
U.S government and government agency securities		267,792		213		(738	)		267,267
Corporate bonds		320,827		147		(782	)		320,192
Municipal bonds		10,849		—		(28	)		10,821
Exchange traded fund		14,963		—		(166	)		14,797
		634,320		363		(1,714	)		632,969
	$	719,028	$	363	$	(1,714	)	$	717,677

	December 31, 2020
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
	(In thousands)
Cash equivalents:
Money market funds	$	400	$	—	$	—	$	400
U.S. government and government agency securities		9,999		—		—		9,999
		10,399		—		—		10,399
Marketable securities:
U.S. government and government agency securities		97,495		685		—		98,180
Corporate bonds		86,945		872		—		87,817
		184,440		1,557		—		185,997
	$	194,839	$	1,557	$	—	$	196,396

There were no sales of equities securities for the year ended December 31, 2021. For the years ended December 31, 2021 and 2020, the activity related to the net gains (losses) on marketable securities included in other income (expense) on the consolidated statements of operations and comprehensive loss were as follows (in thousands):

	Years Ended December 31,
	2021			2020
Realized gains (losses) on available-for-sale securities were as follows:
Realized gains from sales of available-for-sale securities	$	88		$	313
Realized losses from sales of available-for-sale securities		(2	)		(95	)
		86			218
Net gains (losses) on equity securities were as follows:
Net realized gains on equities sold		—			—
Net unrealized losses on equities		(166	)		—
		(166	)		—
Total gain (losses) on marketable securities	$	(80	)	$	218

Maturity information based on fair value of the available-for-sale securities is as follows as of December 31, 2021:

	Within one year		After one year through five years		Total
	(In thousands)
Corporate bonds	$	172,637	$	147,555	$	320,192
U.S. government and government agency securities		137,505		129,762		267,267
Commercial paper		16,892		—		16,892
Municipal bonds		7,791		3,030		10,821
Certificate of deposits		3,000		—		3,000
	$	337,825	$	280,347	$	618,172