4. Available-for-Sale Securities and Fair Value Measurements

Available-for-Sale Securities

The classification of available-for-sale securities in the condensed consolidated balance sheets is as follows:

(In thousands)	March 31, 2015		December 31, 2014
Cash and cash equivalents	$	132,007	$	95,090
Short-term marketable securities	109,954		143,698
Marketable securities	3,932		42,856
Total	$	245,893	$	281,644

The estimated fair value of available-for-sale securities is based on quoted market prices for these or similar investments that were based on prices obtained from a commercial pricing service. Available-for-sale securities are summarized below:

	March 31, 2015
(In thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
U.S. government securities	$	12,505	$	12	$	—		$	12,517
U.S. government agencies	18,471		3		(3		)	18,471
U.S. corporate notes	72,941		7		(31		)	72,917
U.S. commercial paper	9,981		—		—			9,981
Money market funds	132,007		—		—			132,007
Total	$	245,905	$	22	$	(34	)	$	245,893

	December 31, 2014
(In thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Other Than Temporary Impairment Loss			Estimated Fair Value
U.S. government securities	$	30,019	$	24	$	—		$	—		$	30,043
U.S. government agencies	34,756		6		(12		)	—			34,750
U.S. corporate notes	80,880		5		(110		)	—			80,775
U.S. commercial paper	34,469		—		—			—			34,469
Ordinary shares of Theravance Biopharma	10,269		—		—			(3,752		)	6,517
Money market funds	95,090		—		—			—			95,090
Total	$	285,483	$	35	$	(122	)	$	(3,752	)	$	281,644

At March 31, 2015, all of the available-for-sale securities had contractual maturities within two years and the weighted average duration of marketable securities was approximately five months. We do not intend to sell the investments that are in an unrealized loss position, and it is unlikely that we will be required to sell the investments before recovery of their amortized cost basis, which may be maturity. We have determined that the gross unrealized losses on our marketable securities at March 31, 2015 were temporary in nature. All marketable securities with unrealized losses at March 31, 2015 have been in a loss position for less than twelve months.

During the three months ended March 31, 2015, we sold all of the ordinary shares of Theravance Biopharma, Inc. that we held at December 31, 2014, which resulted in a gain on sale of $1.2 million, which is included in other income (expense), net in the condensed consolidated statement of operations.

Fair Value Measurements

Our available-for-sale securities are measured at fair value on a recurring basis and our debt is carried at the amortized cost basis. The estimated fair values were as follows:

	Estimated Fair Value Measurements at Reporting Date Using:
Types of Instruments	Quoted Price in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
(In thousands)	Level 1		Level 2		Level 3		Total
Assets at March 31, 2015
U.S. government securities	$	12,517	$	—	$	—	$	12,517
U.S. government agencies	—		18,471		—		18,471
U.S. corporate notes	—		72,917		—		72,917
U.S. commercial paper	—		9,981		—		9,981
Money market funds	132,007		—		—		132,007
Total assets measured at estimated fair value	$	144,524	$	101,369	$	—	$	245,893
Liabilities at March 31, 2015
Convertible subordinated notes due 2023	$	—	$	223,220	$	—	$	223,220
Non-recourse notes due 2029	—		469,800		—		469,800
Total fair value of liabilities	$	—	$	693,020	$	—	$	693,020

	Estimated Fair Value Measurements at Reporting Date Using:
Types of Instruments	Quoted Price in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
(In thousands)	Level 1		Level 2		Level 3		Total
Assets at December 31, 2014
U.S. government securities	$	30,043	$	—	$	—	$	30,043
U.S. government agencies	—		34,750		—		34,750
U.S. corporate notes	—		80,775		—		80,775
U.S. commercial paper	—		34,469		—		34,469
Ordinary shares of Theravance Biopharma	6,517		—		—		6,517
Money market funds	95,090		—		—		95,090
Total assets measured at estimated fair value	$	131,650	$	149,994	$	—	$	281,644
Liabilities at December 31, 2014
Convertible subordinated notes due 2023	$	—	$	197,095	$	—	$	197,095
Non-recourse notes due 2029	—		456,411		—		456,411
Total fair value of liabilities	$	—	$	653,506	$	—	$	653,506

The fair value of our marketable securities classified within Level 2 were derived from observable inputs that may include benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data including market research publications.

The fair value of our convertible subordinated notes due 2023 and non-recourse notes due 2029 is based on recent trading prices of the instruments, if applicable, or pricing models that utilize current observable market characteristics for similar types of instruments.