Fair Value Measurements |
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| Fair Value Measurements |
6. Fair Value Measurements
Urica’s Equity Investment in Crystalys
Urica values its equity investment in Crystalys using a valuation technique based on significant unobservable inputs (Level 3 in the fair value hierarchy), including an option pricing model backsolve method. As of March 31, 2026, there were no changes in valuation methodology or significant assumptions from those used at December 31, 2025.
During the three months ended March 31, 2026, Urica received approximately 2.3 million additional shares in Crystalys pursuant to anti-dilution provisions, resulting in a $1.0 million increase in the carrying value of the investment. As of March 31, 2026, the total fair value of the Crystalys investment was $16.1 million. No impairments or other adjustments to fair value were recorded during the period. There are significant judgments and estimates inherent in the determination of the fair value, such as those regarding the selection of comparable companies used in estimating volatility, and the probability of possible future events. Such estimates involve inherent uncertainties and the application of significant judgment. Changes in judgements could have a material impact on our results of operations.
Fair Value of Aevitas
The Company valued its retained investment in Aevitas, which is accounted for as an equity method investment for which the Company elected the fair value option, and estimated the fair value using level 3 inputs to be $2.6 million. The Company has not recognized any gains, losses, or impairments on the investment in 2026, 2025, or on a cumulative basis.
Common Stock Warrant Liabilities
Avenue
Avenue has previously issued freestanding warrants to purchase shares of its common stock in connection with financing activities. Avenue’s outstanding warrants to purchase common stock were originally issued in October 2022 (the “October 2022 Warrants”). The October 2022 Warrants are classified as liabilities on the balance sheet as they contain terms for redemption of the underlying security that are outside of its control. In connection with the Avenue January 2023 registered direct offering in January 2023, the down-round price protection feature was triggered and the exercise price for the October 2022 Warrants was permanently adjusted to $116.25, which was the offering price for the Avenue registered direct offering in January 2023. The Black-Scholes model was used to value the October 2022 Warrants and at March 31, 2026 and December 31, 2025 the liability associated with the October 2022 Warrants was nil and $1,000, respectively.
A summary of the weighted average (in aggregate) significant unobservable inputs (Level 3 inputs) used in measuring the Avenue warrant liability that are categorized within Level 3 of the fair value hierarchy was as follows:
Partner Company Derivative Liability The partner company derivative liability associated with Cyprium’s 9.375% Series A Cumulative Redeemable Perpetual Preferred Stock (“Cyprium PPS”) increased in fair value by $7.1 million during the three months ended March 31, 2026. The increase in fair value was due to the settlement of the derivative in connection with the redemption of the Cyprium PPS (Level 1) and the liability was extinguished in connection with the redemption of the PPS (see Note 15). As of March 31, 2026, no transfers occurred between Level , Level , and Level 3 instruments. |
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