Fair Value Measurements

12 Months Ended

Dec. 31, 2018

The Company’s fair value measurements are classified and disclosed in one of the following three categories:


•	Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;


•	Level 2: Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability;


•	Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity).

There was no movement between Level 1 and Level 2 or between Level 2 and Level 3. Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The commercial paper, corporate notes, government securities and asset-backed securities are classified as Level 2 as they were valued based upon quoted market prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant inputs are observable in the market or can be corroborated by observable market data for substantially the full term of the assets. The following table summarizes the valuation of the Company’s financial instruments that are measured at fair value on a recurring basis:



	December 31, 2018								December 31, 2017
			Fair value measurement category								Fair value measurement category
(In thousands)	Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3
Assets:
Money market funds	$	5,838	$	5,838	$	—	$	—	$	—	$	—	$	—	$	—
Repurchase agreements	5,000		—		5,000		—		—		—		—		—
Commercial paper	30,710		—		30,710		—		—		—		—		—
Corporate notes	13,144		—		13,144		—		—		—		—		—
U.S. government securities	10,166		—		10,166		—		—		—		—		—
U.S. asset-backed securities	10,618		—		10,618		—		—		—		—		—
	$	75,476	$	5,838	$	69,638	$	—	$	—	$	—	$	—	$	—
Liabilities:
Warrant liabilities	$	—	$	—	$	—	$	—	$	1,014	$	—	$	1,014	$	—

The fair values of the cash equivalents and marketable securities are based on observable market prices. Accrued interest of $0.1 million is included in the fair value measurements above and currently classified as an other asset on the consolidated balance sheet as of December 31, 2018.

The fair values of the warrants are measured using the Black-Scholes valuation model. See note 12 for further discussion of the significant observable inputs use to measure the warrant liabilities.

The following table summarizes the change in the estimated fair value of the Company’s warrant liabilities:



Warrant Liabilities (In thousands)
Balance at December 31, 2016	$	757
Increase in fair value	257
Balance at December 31, 2017	1,014
Increase in fair value (net of expired warrants)	2,524
Warrant exercise	(3,538		)
Balance at December 31, 2018	$	—

- 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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