6. Fair Value Measurements

Fair value is defined as an exit price that would be received from the sale of an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.

Recurring Valuations

In accordance with the authoritative guidance for financial assets and liabilities measured at fair value on a recurring basis (ASC Topic 820), the Company prioritizes the inputs used to measure fair value from market-based assumptions to entity specific assumptions as follows:

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Level 1—Inputs based on quoted market prices for identical assets or liabilities in active markets at the measurement date.

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Level 2—Observable inputs other than quoted prices in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

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Level 3—Inputs which reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. The inputs are unobservable in the market and significant to the instruments valuation.

The following tables present the Company’s hierarchy for its assets measured at fair value on a recurring basis as of March 31, 2018 and December 31, 2017 (in thousands):

	Fair Value Measurements at March 31, 2018
	(unaudited)
	Total		Level 1		Level 2		Level 3
Assets:
Current:
Cash and cash equivalents	$	11,196	$	11,196	$	—	$	—
Corporate debt securities		86,731		—		86,731		—
Government sponsored securities		12,493		—		12,493		—
Foreign government bonds		5,931		—		5,931		—
Commercial paper		5,438		—		5,438		—
Noncurrent:
Corporate debt securities		12,394		—		12,394		—
Government sponsored securities		2,697		—		2,697		—
Total assets measured at fair value	$	136,880	$	11,196	$	125,684	$	—

	Fair Value Measurements at December 31, 2017
	Total		Level 1		Level 2		Level 3
Assets:
Current:
Cash and cash equivalents	$	23,872	$	20,374	$	3,498	$	—
Corporate debt securities		82,109		—		82,109		—
Government sponsored securities		19,233		—		19,233		—
Foreign government bonds		2,938		—		2,938		—
Noncurrent:
Corporate debt securities		26,883		—		26,883		—
Government sponsored securities		2,717		—		2,717
Total assets measured at fair value	$	157,752	$	20,374	$	137,378	$	—

Non-recurring Valuation

Non-financial assets and liabilities are recognized at fair value subsequent to initial recognition when they are deemed to be other-than-temporarily impaired. There were no material non-financial assets and liabilities deemed to be other-than-temporarily impaired and measured at fair value on a non-recurring basis for the three months ended March 31, 2018.