Fair Value Measurements

We base the fair value of our Level 1 financial instruments that are in active markets using quoted market prices for identical instruments.

We obtain the fair value of our Level 2 financial instruments, which are not in active markets, from a primary professional pricing source using quoted market prices for identical or comparable instruments, rather than direct observations of quoted prices in active markets. Fair value obtained from this professional pricing source can also be based on pricing models whereby all significant observable inputs, including maturity dates, issue dates, settlement date, benchmark yields, reported trades, broker-dealer quotes, issue spreads, benchmark securities, bids, offers or other market related data, are observable or can be derived from, or corroborated by, observable market data for substantially the full term of the asset.

We validate the quoted market prices provided by our primary pricing service by comparing the fair values of our Level 2 marketable securities portfolio balance provided by our primary pricing service against the fair values of our Level 2 marketable securities portfolio balance provided by our investment managers.

The following table represents our fair value hierarchy for our financial assets (cash equivalents and marketable securities) measured at fair value on a recurring basis as of September 30, 2018 (in millions):



	Fair Value Measurements Using
	Level 1		Level 2		Level 3		Total
Cash equivalents	$	177.6	$	37.8	$	—	$	215.4

Equity investment in Tandem Diabetes Care, Inc.	$	42.8	$	—	$	—	$	42.8

Debt securities, available for sale
U.S. government agencies	$	—	$	189.6	$	—	$	189.6
Commercial paper	—		67.9		—		67.9
Corporate debt	—		1.0		—		1.0
Total debt securities, available for sale	$	—	$	258.5	$	—	$	258.5

The following table represents our fair value hierarchy for our financial assets (cash equivalents and marketable securities) measured at fair value on a recurring basis as of December 31, 2017 (in millions):



	Fair Value Measurements Using
	Level 1		Level 2		Level 3		Total
Cash equivalents	$	306.6	$	38.0	$	—	$	344.6
Marketable securities, available for sale
U.S. government agencies	—		87.3		—		87.3
Corporate debt	—		5.1		—		5.1
Commercial paper	—		14.7		—		14.7
Total marketable securities, available for sale	$	—	$	107.1	$	—	$	107.1

There were no transfers between Level 1 and Level 2 securities during the three and nine months ended September 30, 2018 and 2017. There were no transfers into or out of Level 3 securities during the three and nine months ended September 30, 2018 and 2017.

The fair value of our outstanding 2022 Notes was $618.8 million at September 30, 2018 and is a Level 2 measurement. See Note 5 to the Unaudited Consolidated Financial Statements for further discussion on the carrying value of our 2022 Notes.

Any additional investments are included in “Other Assets” in the consolidated balance sheets. It is impracticable for us to estimate the fair value of these investments on a recurring basis due to the fact that these entities are often privately-held and limited information is available if there are no identified events or changes in circumstances that may have a significant adverse effect on the fair value.