Investments

As of March 31, 2017, we had primarily invested our excess cash in debt instruments of the U.S. Treasury, financial institutions, corporations, and U.S. government agencies with strong credit ratings and an investment grade rating at or above A-1, P-1 or F-1 by Moody’s, Standard & Poor’s, or S&P, or Fitch, respectively. We have established guidelines relative to diversification and maturities that maintain safety and liquidity. We periodically review and modify these guidelines to maximize trends in yields and interest rates without compromising safety and liquidity.

The following table summarizes the contract maturity of the available-for-sale securities we held as of March 31, 2017:

One year or less	64%
After one year but within two years	24%
After two years but within three and a half years	12%
Total	100%

As illustrated above, at March 31, 2017, 88 percent of our available-for-sale securities had a maturity of less than two years.

All of our available-for-sale securities are available to us for use in our current operations. As a result, we categorize all of these securities as current assets even though the stated maturity of some individual securities may be one year or more beyond the balance sheet date.

At March 31, 2017, we had an ownership interest of less than 20 percent in three private companies and one public company with which we conduct business. The privately-held companies are Atlantic Pharmaceuticals Limited, Kastle and Dynacure and the publicly-traded company is Antisense Therapeutics Limited. We account for equity investments in the privately-held companies under the cost method of accounting and we account for equity investments in the publicly-traded company at fair value. We record unrealized gains and losses as a separate component of comprehensive income (loss) and include net realized gains and losses in gain (loss) on investments.

The following is a summary of our investments (in thousands):

			Gross Unrealized
March 31, 2017	Cost (1)		Gains		Losses			Estimated Fair Value
Available-for-sale securities:
Corporate debt securities (2)	$	341,043	$	18	$	(405	)	$	340,656
Debt securities issued by U.S. government agencies		64,784		2		(72	)		64,714
Debt securities issued by the U.S. Treasury (2)		23,297		—		(19	)		23,278
Debt securities issued by states of the U.S. and political subdivisions of the states (2)		55,828		2		(116	)		55,714
Total securities with a maturity of one year or less		484,952		22		(612	)		484,362
Corporate debt securities		189,152		49		(833	)		188,368
Debt securities issued by U.S. government agencies		25,670		—		(124	)		25,546
Debt securities issued by the U.S. Treasury		3,497		—		(1	)		3,496
Debt securities issued by states of the U.S. and political subdivisions of the states		55,101		16		(291	)		54,826
Total securities with a maturity of more than one year		273,420		65		(1,249	)		272,236
Total available-for-sale securities	$	758,372	$	87	$	(1,861	)	$	756,598

			Gross Unrealized
December 31, 2016	Cost (1)		Gains		Losses			Estimated Fair Value
Available-for-sale securities:
Corporate debt securities	$	195,087	$	25	$	(161	)	$	194,951
Debt securities issued by U.S. government agencies		26,548		—		(10	)		26,538
Debt securities issued by the U.S. Treasury		29,298		2		(14	)		29,286
Debt securities issued by states of the U.S. and political subdivisions of the states (2)		72,775		2		(134	)		72,643
Total securities with a maturity of one year or less		323,708		29		(319	)		323,418
Corporate debt securities		202,408		36		(1,174	)		201,270
Debt securities issued by U.S. government agencies		28,807		1		(167	)		28,641
Debt securities issued by states of the U.S. and political subdivisions of the states		36,816		1		(349	)		36,468
Total securities with a maturity of more than one year		268,031		38		(1,690	)		266,379
Total available-for-sale securities	$	591,739	$	67	$	(2,009	)	$	589,797
Equity securities:
Regulus Therapeutics Inc.	$	2,133	$	281	$	—		$	2,414
Total equity securities	$	2,133	$	281	$	—		$	2,414
Total available-for-sale and equity securities	$	593,872	$	348	$	(2,009	)	$	592,211

(1)

Our available-for-sale securities are held at amortized cost.

(2)

Includes investments classified as cash equivalents on our condensed consolidated balance sheet.

Investments we consider to be temporarily impaired at March 31, 2017 were as follows (in thousands):

			Less than 12 Months of Temporary Impairment					More than 12 Months of Temporary Impairment					Total Temporary Impairment
	Number of Investments		Estimated Fair Value		Unrealized Losses			Estimated Fair Value		Unrealized Losses			Estimated Fair Value		Unrealized Losses
Corporate debt securities		354	$	421,288	$	(1,180	)	$	22,387	$	(58	)	$	443,675	$	(1,238	)
Debt securities issued by U.S. government agencies		41		84,017		(196	)		—		—			84,017		(196	)
Debt securities issued by the U.S. Treasury		4		25,773		(20	)		—		—			25,773		(20	)
Debt securities issued by states of the U.S. and political subdivisions of the states		97		90,816		(336	)		4,916		(71	)		95,732		(407	)
Total temporarily impaired securities		496	$	621,894	$	(1,732	)	$	27,303	$	(129	)	$	649,197	$	(1,861	)

We believe that the decline in value of these securities is temporary and is primarily related to the change in market interest rates since purchase. We believe it is more likely than not that we will be able to hold our debt securities to maturity. Therefore, we anticipate full recovery of our debt securities’ amortized cost basis at maturity.