9. Intangible Assets and Goodwill

9 Months Ended

Sep. 30, 2013

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets and Goodwill

Intangible assets consist of the following:

		September 30,			December 31,
	Life	2013			2012
Patents	12 - 15 years	$	1,442,000		$	1,442,000
Brand	8 years		3,887,000			3,887,000
Product licenses	1 – 13 years		16,183,794			15,135,050
Customer relationships	6 years		1,848,000			1,848,000
Non-compete and supplier contracts	2 - 7 years		5,194,571			5,194,571
Trademark rights	Indefinite		638,563			638,563
In-process research and development acquired(1)			43,733,000			45,200,000
Developed technology	9-12 years		40,000,000			37,000,000
			112,926,928			110,345,184
Accumulated amortization			(12,614,557	)		(6,290,753)
Total		$	100,312,371		$	104,054,431

(1) Amortization will begin once the related products go into production; if the product in development fails or is abandoned, it will be written off.

Estimated amortization expense related to intangible assets with definite lives for each of the five succeeding years and thereafter is as follows:

	Amount
2013 (September – December)	$	1,890,713
2014		7,682,420
2015		7,682,420
2016		7,682,420
2017		6,166,374
Thereafter		24,836,462
Total	$	55,940,809

Amortization expense is approximately $2,491,000 and $6,979,000 for the three and nine months ended September 30, 2013 and $775,000 and $2,158,000 for the three and nine months ended September 30, 2012, respectively. 

Changes in the carrying amount of goodwill for the nine months ended September 30, 2013 and the year ended December 31, 2012 are as follows:

	September 30, 2013		December 31,  2012
Beginning Balance	$	37,160,911	$	1,406,591
Goodwill acquired – Somaxon		10,748,243	─
Goodwill acquired – Cypress	─			34,838,745
Goodwill acquired – GSL	─			915,575
Adjustments (1)		5,916,122	─
Total	$	53,825,276	$	37,160,911

(1) Primarily reflects the impact of measurement period adjustments related to the Cypress and Somaxon acquisitions composed of a deferred tax asset on the increase in the basis of the acquired inventory, an increase in certain accrued allowances and the impact of the re-evaluation of the opening balance sheet Cypress intangible assets and inventory.  See Note 1, Company Overview and Note 5, Disposition of Certain Cypress Assets, for further discussion.