NOTE 5. BALANCE SHEET COMPONENTS

Inventory

As of March 31, 2017 and December 31, 2016, our inventory consisted of the following components:



	March 31,		December 31,
(in thousands)	2017		2016
Purchased materials	$	5,573	$	4,817
Work in process		5,967		7,287
Finished goods		3,808		3,530
Inventory	$	15,348	$	15,634

Prepaid Expenses and Other Current Assets

As of March 31, 2017 and December 31, 2016, our prepaid expenses and other current assets consisted of the following components:


	March 31,		December 31,
(in thousands)	2017		2016
Receivable from Existing Landlord	$	2,437	$	5,000
Rent deposits for O'Brien building		2,160		2,160
Prepaid expenses		1,323		2,342
Other current assets		581		476
Prepaid expenses and other current assets	$	6,501	$	9,978

In January 2017, we entered into a Third Lease Amendment Agreement with the Existing Landlord that increased the amount of the payments receivable from the Existing Landlord by $65,000. In February 2017 and March 2017, we received payments of $1,045,000 and $1,583,000, respectively, from the Existing Landlord, resulting in a balance of $2,437,000 remaining in “Receivable from Existing Landlord” as of March 31, 2017. Refer to “Note 7. Commitments and Contingencies” for additional details relating to our lease agreements.

Other Long-term Assets

As of March 31, 2017 and December 31, 2016, our other long-term assets consisted of the following components:


	March 31,		December 31,
(in thousands)	2017		2016
Rent deposits and tenant improvements for O'Brien building	$	—	$	9,641
Other		219		172
Other long-term assets	$	219	$	9,813

In January 2017 we moved into the O’Brien building, and accordingly, the $9.6 million tenant improvements balance recorded in “Other Long-term Assets” at December 31, 2016 was transferred into leasehold improvements under “Property and Equipment” in the three-month period ended March 31, 2017.

Property and Equipment, Net

As of March 31, 2017 and December 31, 2016, our property and equipment, net, consisted of the following components:


	March 31,		December 31,
(in thousands)	2017		2016
Building	$	1,160	$	1,160
Laboratory equipment and machinery		24,614		23,337
Leasehold improvements		38,109		8,138
Computer equipment		8,338		7,170
Software		4,600		5,189
Furniture and fixtures		2,390		823
Construction in progress		1,378		5,772
		80,589		51,589
Less: Accumulated depreciation		(38,140)		(37,029)
Property and equipment, net	$	42,449	$	14,560

By the end of the first quarter of 2017, improvements associated with our O’Brien premises were substantially completed. As a result, during the first quarter of 2017 we capitalized $28.9 million of tenant improvements. As the premises were completed in phases during the first quarter 2017, tenant improvements were placed into service in phases once construction was substantially complete and the related asset was ready for its intended use. Refer to “Note 7. Commitments and Contingencies” for additional details.