Fair Value Measurements

12 Months Ended

Dec. 31, 2018

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

6. FAIR VALUE MEASUREMENTS

The Company’s financial instruments consist of cash and cash equivalents, short-term investments, restricted cash and accounts payable. The carrying amount of cash, restricted cash and accounts payable are each considered a reasonable estimate of fair value due to the short-term maturity.

Assets measured at fair value on a recurring basis were as follows:

Description	December 31, 2018		Quoted Prices (Unadjusted) in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(in thousands)
Cash equivalents:
Money market mutual funds	$	31,740	$	31,740	$	—	$	—
Commercial paper		5,974		—		5,974		—
U.S. Treasury securities		35		35		—		—
Total cash equivalents	$	37,749	$	31,775	$	5,974	$	—
Short-term investments:
Asset-backed securities	$	19,520	$	—	$	19,520	$	—
Commercial paper		72,597		—		72,597		—
Corporate debt securities		54,461		—		54,461		—
U.S. Treasury securities		29,939		—		29,939		—
Total short-term investments	$	176,517	$	—	$	176,517	$	—
Total financial assets	$	214,266	$	31,775	$	182,491	$	—

Description	December 31, 2017		Quoted Prices (Unadjusted) in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(in thousands)
Cash equivalents:
Money market mutual funds	$	44,182	$	44,182	$	—	$	—
Total cash equivalents	$	44,182	$	44,182	$	—	$	—
Short-term investments:
Asset-backed securities	$	7,422	$	—	$	7,422	$	—
Commercial paper		34,882		—		34,882		—
Corporate debt securities		26,856		—		26,856		—
U.S. Treasury securities		8,924		—		8,924		—
Total short-term investments	$	78,084	$	—	$	78,084	$	—
Total financial assets	$	122,266	$	44,182	$	78,084	$	—

Short-term securities are valued using models or other valuation methodologies that use Level 2 inputs. These models are primarily industry-standard models that consider various assumptions, including time value, yield curve, volatility factors, default rates, current market and contractual prices for the underlying financial instruments, as well as other relevant economic measures. Substantially all of these assumptions are observable in the marketplace, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace.

The convertible preferred stock tranche liability, which was derecognized in February 2017 (see Note 11), was stated at fair value and was measured using a Level 3 input because the fair value measurement was based, in part, on significant inputs not observed in the market.

The reconciliations of changes in the fair value of financial instruments based on Level 3 inputs for the year ended December 31, 2017 consisted of:

(in thousands)
Fair value as of January 1, 2017	$	4,247
Change in fair value of convertible preferred    stock tranche liability		876
Reduction in tranche liability due to preferred    stock issuance		(5,123	)
Fair value as of December 31, 2017	$	—

The Company had no liability related to the convertible preferred stock as of December 31, 2018. There were no transfers between fair value measure levels during the years ended December 31, 2018 and 2017.