Kodiak Sciences Inc. Notes to Consolidated Financial Statements (in thousands, except share and per share data) 93 Credit Losses – Available-for-Sale Debt Securities For available-for-sale debt securities in an unrealized loss position, the Company will periodically assess its portfolio for impairment. The assessment first considers the intent or requirement to sell the security. If either of these criteria are met, the amortized cost basis will be written down to fair value through earnings. If not met, the Company will evaluate whether the decline resulted from credit losses or other factors by considering the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, and any adverse conditions specifically related to the security, among other factors. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security is compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses will be recorded, limited by the amount that the fair value is less than the amortized cost basis. Any impairment that has not been recorded through an allowance for credit losses is recognized in other comprehensive income or loss, as applicable. Net Loss per Share Basic net loss per common share is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of common stock outstanding during the period, without consideration of potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted-average number of common stock and potentially dilutive securities outstanding for the period. Since the Company has reported net loss for all periods presented, diluted net loss per share is the same as basic net loss per common share for those periods. Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board ("FASB"), under its ASC or other standard setting bodies, and adopted by the Company as of the specified effective date. There have been no new accounting pronouncements issued nor adopted during the year ended December 31, 2022 that are of significance to the Company. 3. Property and Equipment, net Property and equipment, net consists of the following (in thousands): December 31, 2022 December 31, 2021 Furniture and Fixtures ................................................................... $ 1,969 $ 214 Machinery and Equipment ............................................................ 12,763 4,672 Computer Software and Hardware................................................ 374 289 Leasehold Improvement................................................................ 43,483 1,285 Construction in Progress ............................................................... 4,519 37,809 Total property and equipment ....................................................... 63,108 44,269 Less: Accumulated depreciation ................................................... (6,724) (2,939) Property and equipment, net.......................................................... $ 56,384 $ 41,330 All property and equipment are maintained in the United States and Switzerland. Depreciation expense was $3.8 million, $1.0 million and $0.5 million for the years ended December 31, 2022, 2021 and 2020, respectively.