Fair Value Measurements

12 Months Ended

Dec. 31, 2012

Fair Value Measurements

Fair Value Measurements

5. Fair Value Measurements

        The Company defines estimated fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.

        The Company's valuation techniques are based on observable and unobservable inputs. Observable inputs reflect readily obtainable data from independent sources, while unobservable inputs reflect the Company's market assumptions. The Company classifies these inputs into the following hierarchy:

• Level 1 Inputs—Quoted prices for identical instruments in active markets.

  Level 2 Inputs—Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable.

  Level 3 Inputs—Unobservable inputs and little, if any, market activity for the assets.

        The estimated fair values of the Company's financial assets were as follows:

	Estimated Fair Value Measurements at Reporting Date Using:
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
Types of Instruments (in thousands)	Level 1		Level 2		Level 3		Total
Assets at December 31, 2012:
U.S. government securities	$	27,205	$	—	$	—	$	27,205
U.S. government agency securities		56,969		58,497		—		115,466
U.S. corporate notes		40,472		51,094		—		91,566
U.S. commercial paper		—		23,082		—		23,082
Money market funds		78,646		—		—		78,646
Total assets measured at estimated fair value	$	203,292	$	132,673	$	—	$	335,965
Liabilities at December 31 , 2012:
Convertible subordinated notes	$	—	$	194,050	$	—	$	194,050

	Estimated Fair Value Measurements at Reporting Date Using:
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
Types of Instruments (in thousands)	Level 1		Level 2		Level 3		Total
Assets at December 31, 2011:
U.S. government securities	$	66,174	$	—	$	—	$	66,174
U.S. government agency securities		55,901		37,274		—		93,175
U.S. corporate notes		2,705		—		—		2,705
U.S. commercial paper		—		34,976		—		34,976
Money market funds		38,721		—		—		38,721
Total assets measured at estimated fair value	$	163,501	$	72,250	$	—	$	235,751
Liabilities at December 31, 2011:
Convertible subordinated notes	$	—	$	189,588	$	—	$	189,588

        At December 31, 2012, there were no transfers from Level 1 to Level 2 or from Level 2 to Level 1 in comparison to December 31, 2011.