FAIR VALUE MEASUREMENTS

9 Months Ended

Sep. 30, 2018

5. FAIR VALUE MEASUREMENTS

The following tables present information about our assets that are measured at fair value on a recurring basis at September 30, 2018 and December 31, 2017, and indicate the fair value hierarchy of the valuation techniques we utilized to determine such fair value, in thousands:

Description	At September 30, 2018		Quoted Prices in Active Markets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Cash equivalents:
Corporate notes	$	2,729	$	—	$	2,729	$	—
U.S. government-sponsored enterprise securities		1,985		—		1,985		—
U.S. treasury securities		9,974		—		9,974		—
Money market funds		232,073		232,073		—		—
Marketable debt securities:
Certificates of deposit		18,800		—		18,800		—
Commercial paper		101,376		—		101,376		—
Corporate notes		324,379		—		324,379		—
U.S. government-sponsored enterprise securities		111,339		—		111,339		—
U.S. treasury securities		349,328		—		349,328		—
Marketable equity securities		15,004		15,004		—		—
Restricted cash (money market funds)		1,476		1,476		—		—
Total	$	1,168,463	$	248,553	$	919,910	$	—

Description	At December 31, 2017		Quoted Prices in Active Markets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Cash equivalents:
Commercial paper	$	82,262	$	—	$	82,262	$	—
Corporate notes		18,116		—		18,116		—
U.S. government-sponsored enterprise securities		231,122		—		231,122		—
U.S. treasury securities		62,855		—		62,855		—
Money market funds		122,986		122,986		—		—
Marketable debt securities:
Certificates of deposit		30,200		—		30,200		—
Commercial paper		56,951		—		56,951		—
Corporate notes		373,252		—		373,252		—
U.S. government-sponsored enterprise securities		398,298		—		398,298		—
U.S. treasury securities		200,475		—		200,475		—
Restricted cash (money market funds)		1,471		1,471		—		—
Total	$	1,577,988	$	124,457	$	1,453,531	$	—

During the nine months ended September 30, 2018 and 2017, there were no transfers between Level 1 and Level 2 financial assets. The carrying amounts reflected in our condensed consolidated balance sheets for cash, accounts receivable, net, other current assets, accounts payable and accrued expenses approximate fair value due to their short-term maturities. As of September 30, 2018, we had $9.0 million included in long-term other assets on our condensed consolidated balance sheet that represents the discounted present value, based on a Level 2 fair value measurement, of the $13.0 million cash payment due from Dicerna by April 18, 2022 under the terms of the Settlement Agreement, described more fully above at Note 2. We are accounting for this receivable as a transaction between two parties and imputing the interest through interest income on our condensed consolidated statements of comprehensive loss. To determine the present value of this receivable, we used an interest rate of 11 percent as of the settlement date for a note that would have resulted if an independent borrower and independent lender had negotiated a similar transaction. The fair value of our long-term debt at September 30, 2018, computed pursuant to a discounted cash flow technique using a market interest rate, was $30.1 million and is considered a Level 3 fair value measurement. The effective interest rate reflects the current market rate.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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