6. Balance Sheet Components

Inventories

Inventories consisted of the following (in thousands):

	September 30, 2018		December 31, 2017
Raw materials	$	738	$	—
Work in process		13,687		1,032
Finished goods		25		67
Total inventories	$	14,450	$	1,099

Balance Sheet Classification
Inventories	$	6,123	$	1,099
Prepaid and other long-term assets		8,327		—
Total inventories	$	14,450	$	1,099

We began capitalizing inventory for costs associated with Andexxa Gen 1 supply upon FDA approval on May 3, 2018. We began capitalizing inventory for costs associated with Bevyxxa during the fourth quarter of 2017 when it was determined that the inventory had a probable future economic benefit. As of September 30, 2018 and December 31, 2017, prepaid manufacturing on the Condensed Consolidated Balance Sheets represent prepayments of $4.1 million and $2.3 million, respectively, made to manufacturers for the purchase of inventories which we expect to be utilized in the manufacturing process and/or sold within the next twelve months. As of September 30, 2018 and December 31, 2017, long-term prepaid manufacturing of $12.5 million and $9.6 million, respectively, are classified as prepaid and other long-term assets as these inventories are not expected to be utilized in the manufacturing process and/or sold within the next twelve months, and the amount is deemed recoverable.

We established a reserve of $2.2 million for obsolescence inventories as of September 30, 2018. We recorded a related charge to cost of sales for $1.7 million and $2.2 million during the three and nine months ended September 30, 2018, respectively. In developing the estimate for inventory reserve, we used estimates of demand. If it is determined that inventory utilization will further diminish based on estimates of demand, additional inventory write-downs may be required.

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consist of the following (in thousands):

	September 30, 2018		December 31, 2017
Prepaid insurances	$	1,559	$	654
Prepaid subscriptions		1,276		1,161
Prepaid other		800		528
Interest receivable		792		900
Prepaid rent and maintenance		554		526
Other receivable		276		2,908
Total prepaid expenses and other current assets	$	5,257	$	6,677

Accrued and Other Liabilities

Accrued and other liabilities consist of the following (in thousands):

	September 30, 2018		December 31, 2017
Commercial related	$	5,632	$	1,694
Legal and accounting fees		209		256
Deferred rent		940		879
Current portion of long term obligation to collaborator		697		—
Other		1,815		723
Total accrued and other liabilities	$	9,293	$	3,552