Intangible Assets and Goodwill

6 Months Ended

Jun. 30, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

The following information details the carrying amounts and accumulated amortization of the Company's intangible assets subject to amortization:



	As of June 30, 2014								As of December 31, 2013
	Weighted Average Useful Life	Gross Carrying Amount		Accumulated Amortization and other charges			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
		(in thousands)
Identifiable intangible assets
Customer relationships	8 years	$	7,457	$	(6,544	)	$	913	$	7,457	$	(5,631	)	$	1,826
Selling rights agreements	5.7 years	9,125		(7,415		)	1,710		9,125		(5,870		)	3,255
Trademarks	8 years	3,024		(2,654		)	370		3,024		(2,284		)	740
Product licenses	6.2 years	71,000		(50,307		)	20,693		71,530		(25,067		)	46,463
Developed product rights	14.5 years	94,430		(1,338		)	93,092		—		—			—
Cleviprex milestones	12.5 years	2,000		(233		)	1,767		2,000		(191		)	1,809
Total	10.5 years	$	187,036	$	(68,491	)	$	118,545	$	93,136	$	(39,043	)	$	54,093

In May 2014, the Company completed its acquisition of Tenaxis and Tenaxis became a wholly owned subsidiary of the Company. The Company valued the intangible assets obtained from the acquisition of Tenaxis and classified such assets as developed products rights.

The Company recorded an impairment charge on product licenses of $15.1 million to cost of sales as a result of reduction in estimated future cash flows expected to be generated by the acute care generic products as determined by an updated discounted cash flow analysis (Level 3). The Company expects amortization expense related to its intangible assets to be $15.3 million for the remainder of the year ending December 31, 2014. The Company expects annual amortization expense related to its intangible assets to be $10.0 million, $8.6 million, $8.7 million, $8.7 million and $8.3 million for the years ending December 31, 2015, 2016, 2017, 2018 and 2019, respectively, with the balance of $58.9 million being amortized thereafter. The Company records amortization of customer relationships, selling rights agreements and trademarks in selling, general and administrative expense on the consolidated statements of income. The Company records amortization of Cleviprex milestones, product licenses and developed product rights in cost of revenue on the consolidated statements of income.

The following information details the carrying amounts of the Company's intangible assets not subject to amortization:



	As of June 30, 2014					As of December 31, 2013
	Gross Carrying Amount		Adjustments	Net Carrying Amount		Gross Carrying Amount		Adjustments	Net Carrying Amount
	(in thousands)
Intangible assets not subject to amortization:
In-process research and development	$	720,180	—	$	720,180	$	720,180	—	$	720,180
Recothrom option	62,000		—	62,000		62,000		—	62,000
Total	$	782,180	—	$	782,180	$	782,180	—	$	782,180

The changes in the carrying amount of goodwill for the six months ended June 30, 2014:



	June 30, 2014
	(in thousands)
Balance as of December 31, 2013	$	257,694
Goodwill resulting from the acquisition of Tenaxis	26,796
Translation adjustments	332
Balance as of June 30, 2014	$	284,822

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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