Travere Therapeutics, Inc.TVTX
Travere Therapeutics, Inc. Fair Value Disclosure
FAIR VALUE MEASUREMENTS
The Company utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below:
Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;
Level 2 – Quoted prices in markets that are not active or financial instruments for which all significant inputs are observable, either directly or indirectly; and
Level 3 – Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.
The valuation techniques used to measure the fair value of the Company’s debt securities and all other financial instruments, all of which have counterparties with high credit ratings, were valued based on quoted market prices or model driven valuations using significant inputs derived from or corroborated by observable market data. Based on the fair value hierarchy, the Company classified marketable debt securities within Level 2.
Financial instruments with carrying values approximating fair value include cash and cash equivalents, accounts receivable, and accounts payable, due to their short-term nature. As of December 31, 2025 and 2024, the fair value of the Company's 2.25% Convertible Senior Notes due 2029, which were issued in 2022, was $448.3 million and $302.1 million, respectively. As of December 31, 2024, the fair value of the Company's 2.50% Convertible Senior Notes due 2025, now repaid, was $68.2 million. The fair values were estimated utilizing market quotations and are considered Level 2.
The following table presents the Company’s assets, measured and recognized at fair value on a recurring basis, classified under the appropriate level of the fair value hierarchy as of December 31, 2025 (in thousands):
| As of December 31, 2025 | Fair Value Hierarchy at December 31, 2025 | ||||||||||||||||||||||
| Total carrying and estimated fair value | Quoted prices in active markets (Level 1) | Significant other observable inputs (Level 2) | Significant unobservable inputs (Level 3) | ||||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Cash and Cash Equivalents | $ | 93,035 | $ | 93,035 | $ | — | $ | — | |||||||||||||||
| Marketable debt securities, available-for-sale | 229,761 | — | 229,761 | — | |||||||||||||||||||
| Total | $ | 322,796 | $ | 93,035 | $ | 229,761 | $ | — | |||||||||||||||
The following table presents the Company’s assets, measured and recognized at fair value on a recurring basis, classified under the appropriate level of the fair value hierarchy as of December 31, 2024 (in thousands):
| As of December 31, 2024 | Fair Value Hierarchy at December 31, 2024 | ||||||||||||||||||||||
| Total carrying and estimated fair value | Quoted prices in active markets (Level 1) | Significant other observable inputs (Level 2) | Significant unobservable inputs (Level 3) | ||||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Cash and Cash Equivalents | $ | 58,535 | $ | 51,060 | $ | 7,475 | $ | — | |||||||||||||||
| Marketable debt securities, available-for-sale | 312,166 | — | 312,166 | — | |||||||||||||||||||
| Total | $ | 370,701 | $ | 51,060 | $ | 319,641 | $ | — | |||||||||||||||
Assets Measured at Fair Value on a Nonrecurring Basis
The Company’s long-lived assets are measured at fair value on a nonrecurring basis when there are indicators of impairment and a loss is recognized. During the year ended December 31, 2025, there were no impairments to long-lived assets. During the year ended December 31, 2024, the Company recorded impairment charges of $1.2 million on right-of-use assets, property and equipment, and other capitalized assets as the fair value of the asset group was less than their carrying value. The fair value of the asset group was determined under the income approach based on projected future cash flows from the operating sublease discounted by a risk adjusted rate of 6.9%. The Company classified the fair value of the asset group as Level 3. See Note 18 for further discussion.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 19, 2026 | Showing above |
| 2024 | Feb 21, 2025 | |
| 2023 | Feb 20, 2024 | |
| 2022 | Feb 23, 2023 | |
| 2021 | Feb 24, 2022 | |
| 2020 | Mar 1, 2021 | |
| 2019 | Feb 24, 2020 | |
| 2018 | Feb 26, 2019 | |
| 2017 | Feb 27, 2018 | |
| 2016 | Mar 1, 2017 | |
| 2015 | Feb 26, 2016 | |
About Fair Value Disclosures
Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.
Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.