3. Investments

As of March 31, 2013, we have 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 (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, 2013:

One year or less	47	%
After one year but within two years	41	%
After two years but within three years	12	%
Total	100	%

As illustrated above, we primarily invest our excess cash in short-term instruments with 88 percent of our available-for-sale securities having a maturity of less than two years.

At March 31, 2013, we had an ownership interest of less than 20 percent in each of three private companies and three public companies with which we conduct business. The privately-held companies are Santaris Pharma A/S (formerly Pantheco A/S), Achaogen Inc., and Atlantic Pharmaceuticals Limited. The publicly-traded companies are Antisense Therapeutics Limited, iCo Therapeutics Inc., and Regulus. 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 companies 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. In the first quarter of 2013, we sold all of the common stock of Sarepta Therapeutics, Inc. that we owned resulting in a realized gain of $1.1 million.

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

								Other-Than-
								Temporary
	Amortized		Unrealized					Impairment		Estimated
March 31, 2013	Cost		Gains		Losses			Loss		Fair Value
Short-term investments:
Corporate debt securities	$	97,983	$	59	$	(29	)	$	—	$	98,013
Debt securities issued by U.S. government agencies	9,932		1		(46		)	—		9,887
Debt securities issued by the U.S. Treasury	1,000		1		—			—		1,001
Debt securities issued by states of the United States and political subdivisions of the states	15,549		55		(11		)	—		15,593
Total securities with a maturity of one year or less	124,464		116		(86		)	—		124,494
Corporate debt securities	107,131		110		(156		)	—		107,085
Debt securities issued by U.S. government agencies	15,020		35		(3		)	—		15,052
Debt securities issued by the U.S. Treasury	12,393		30		—			—		12,423
Debt securities issued by states of the United States and political subdivisions of the states	5,203		7		(3		)	—		5,207
Total securities with a maturity of more than one year	139,747		182		(162		)	—		139,767
Subtotal	$	264,211	$	298	$	(248	)	$	—	$	264,261

								Other-Than-
								Temporary
	Cost		Unrealized					Impairment			Estimated
March 31, 2013	Basis		Gains		Losses			Loss			Fair Value
Equity securities:
Current portion (Regulus Therapeutics Inc.)	$	15,525	$	29,338	$	—		$	—		$	44,863
Current portion (included in Other current assets)	1,538		1,961		—			(880		)	2,619
Long-term portion (included in Deposits and other assets)	625		—		—			—			625
Subtotal	$	17,688	$	31,299	$	—		$	(880	)	$	48,107
	$	281,899	$	31,597	$	(248	)	$	(880	)	$	312,368

								Other-Than-
								Temporary
	Amortized		Unrealized					Impairment		Estimated
December 31, 2012	Cost		Gains		Losses			Loss		Fair Value
Short-term investments:
Corporate debt securities	$	113,249	$	81	$	(9	)	$	—	$	113,321
Debt securities issued by U.S. government agencies	10,100		2		(66		)	—		10,036
Debt securities issued by the U.S. Treasury	1,000		1		—			—		1,001
Debt securities issued by states of the United States and political subdivisions of the states	16,560		18		(2		)	—		16,576
Total securities with a maturity of one year or less	140,909		102		(77		)	—		140,934
Corporate debt securities	80,166		112		(92		)	—		80,186
Debt securities issued by U.S. government agencies	8,034		38		—			—		8,072
Debt securities issued by the U.S. Treasury	12,424		27		—			—		12,451
Debt securities issued by states of the United States and political subdivisions of the states	8,306		31		(16		)	—		8,321
Total securities with a maturity of more than one year	108,930		208		(108		)	—		109,030
Subtotal	$	249,839	$	310	$	(185	)	$	—	$	249,964

								Other-Than-
								Temporary
	Cost		Unrealized					Impairment			Estimated
December 31, 2012	Basis		Gains		Losses			Loss			Fair Value
Equity securities:
Current portion (Regulus Therapeutics Inc.)	$	15,526	$	18,096	$	—		$	—		$	33,622
Current portion (included in Other current assets)	1,579		4,175		—			(880		)	4,874
Long-term portion (included in Deposits and other assets)	625		—		—			—			625
Subtotal	$	17,730	$	22,271	$	—		$	(880	)	$	39,121
	$	267,569	$	22,581	$	(185	)	$	(880	)	$	289,085

Investments we considered to be temporarily impaired at March 31, 2013 were as follows (in thousands):

		Less than 12 months of temporary impairment
	Number of Investments	Estimated Fair Value		Unrealized Losses
Corporate debt securities	70	$	95,606	$	(185	)
Debt securities issued by U.S. government agencies	4	13,885		(49		)
Debt securities issued by states of the United States and political subdivisions of the states	3	4,537		(14		)
Total temporarily impaired securities	77	$	114,028	$	(248	)

We believe that the decline in value of these securities is temporary and 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 these securities to maturity. Therefore we anticipate full recovery of their amortized cost basis at maturity.