Company: OPGN
Filing Date: 2025-10-01
Form Type: 10-Q
Source: 0001829126-25-007819
Chunk: 21

Company: OPGEN INC
Filing Date: 2025-10-01
Form: 10-Q
Item: Part I, Item 1
Chunk 21
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 use of observable inputs and minimize the use of unobservable inputs. The Company utilizes a three-level valuation hierarchy for disclosures of fair value measurements, defined as follows:

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    Level 1 - defined as observable inputs such as quoted prices in active markets;

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    Level 2 - defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and

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    Level 3 - defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions such as expected revenue growth and discount factors applied to cash flow projections.

For the three months ended March 31, 2025 and 2024, the Company has not transferred any assets between fair value measurement levels.

Financial assets and liabilities measured at fair value on a recurring basis

The Company evaluates financial assets and liabilities subject to fair value measurements on a recurring basis to determine the appropriate level at which to classify them each reporting period. This determination requires the Company to make subjective judgments as to the significance of inputs used in determining fair value and where such inputs lie within the hierarchy.

Prior to its settlement in August 2024, the Company accounted for its guaranty of the EIB debt (see Note 7) of its previously consolidated subsidiary, Curetis, at fair value. This fair value, in addition to the principal and interest, included a participation percentage interest (“PPI”) right in the debt. The Company concluded this right constituted an embedded derivative, which was separated and measured at fair value with changes being accounted for through profit or loss. The Company determined the fair value of the derivative using a Monte Carlo simulation model. Using this model, level 3 unobservable inputs include estimated discount rates and estimated risk-free interest rates.

Financial assets and liabilities carried at fair value on a non-recurring basis

As disclosed in Note 5, as of March 31, 2025, the Company held an investment in the equity securities of the Client valued at $5.0 million, which is classified as a current asset on the accompanying unaudited condensed consolidated balance sheets. The investment was received as consideration for services rendered and represents a non-controlling equity interest in a privately held entity. The Company accounts for this investment under ASC 321, Investments – Equity Securities. Since the equity securities do not have a readily determinable fair value, the Company has elected the measurement alternative and, accordingly, it is carried at its estimated fair value calculated as its cost less any impairment charges until