GOODWILL AND INTANGIBLE ASSETS

3 Months Ended

Mar. 31, 2023

GOODWILL AND INTANGIBLE ASSETS

GOODWILL AND INTANGIBLE ASSETS

8. GOODWILL AND INTANGIBLE ASSETS

Goodwill

As a result of our 2013 merger with BioSante Pharmaceuticals, Inc. (“BioSante”), we recorded goodwill of $1.8 million. As a result of our acquisition of WellSpring Pharma Services Inc., we recorded additional goodwill of $1.7 million in 2018. From our acquisition of Novitium in 2021, we recorded goodwill of $24.6 million. We have two operating segments, which are the same as our two reporting units, Generics, Established Brands, and Other reporting unit and the Rare Disease reporting unit. All of the goodwill is recorded in our Generics, Established Brands, and Other reporting unit.

We assess the recoverability of the carrying value of goodwill as of October 31^st of each year, and whenever events occur or circumstances change that would, more likely than not, reduce the fair value of our reporting unit below its carrying value. There have been no events or changes in circumstances that would have reduced the fair value of our reporting unit below its carrying value during the three months ended March 31, 2023. No impairment losses were recognized during the three months ended March 31, 2023 and 2022.

Intangible Assets

The components of definite-lived intangible assets and indefinite-lived intangible assets other than goodwill are as follows:

	March 31, 2023				December 31, 2022				Remaining Weighted Average
	Gross Carrying		Accumulated		Gross Carrying		Accumulated		Amortization
(in thousands)	Amount		Amortization		Amount		Amortization		Period(1)
Definite-Lived Intangible Assets:
Acquired ANDAs intangible assets	$	195,862	$	(81,630)	$	195,862	$	(75,606)	5.6	years
NDAs and product rights		242,372		(167,856)		242,372		(162,188)	3.7	years
Marketing and distribution rights		17,157		(13,550)		17,157		(13,309)	3.8	years
Non-compete agreement		624		(624)		624		(602)	—	years
Customer relationships		24,900		(5,039)		24,900		(4,150)	5.6	years
Total Definite-Lived Intangible Assets		480,915		(268,699)		480,915		(255,855)	4.9	years
Indefinite-Lived Intangible Assets:

In process research and development		26,575		—		26,575		—	Indefinite
Total Intangible Assets, net	$	507,490	$	(268,699)	$	507,490	$	(255,855)

(1) ^{Weighted average amortization period as of March 31, 2023.} ​

The definite-lived Abbreviated New Drug Applications (“ANDAs”), New Drug Applications (“NDAs”) and product rights, marketing and distribution rights, customer relationships, and non-compete agreement are stated at cost, net of amortization, and generally amortized over their remaining estimated useful lives, ranging from seven to 10 years, based on the straight-line method. In the case of certain NDAs and product rights assets, we use an accelerated amortization method to better match the anticipated economic benefits expected to be provided. Our indefinite-lived intangible assets other than goodwill include in-process research and development (“IPR&D”) projects. IPR&D intangible assets represent the fair value of technology acquired in a business combination for which the technology projects are incomplete but have substance. When an IPR&D project is completed (generally upon receipt of regulatory approval), the asset is then accounted for as a definite-lived intangible asset.

Amortization expense was $12.8 million and $12.5 million for the three months ended March 31, 2023 and 2022, respectively.

We test for impairment of definite-lived intangible assets and indefinite-lived intangible assets when events or circumstances indicate that the carrying value of the assets may not be recoverable. No such triggering events were identified in the three months ended March 31, 2023. No such triggering events were identified during the three months ended March 31, 2023 and 2022 and therefore no impairment loss was recognized in the three months ended March 31, 2023 and 2022.

Expected future amortization expense for definite-lived intangible assets is as follows:

(in thousands)
2023 (remainder of the year)	$	38,464
2024		48,331
2025		45,096
2026		31,778
2027		22,866
2028 and thereafter		25,681
Total	$	212,216