Intangible Assets

3 Months Ended

Sep. 30, 2012

Intangible Assets

3. Intangible Assets

The reconciliation of intangible assets for the three months ended September 30, 2012 and for the year ended June 30, 2012 is as follows:

	Three Months Ended			Year Ended
	September 30, 2012			June 30, 2012
	(In thousands)
Patented technologies
Gross carrying amount at beginning of period	$	39,556		$	55,422
Asset impairment write-down		—			(14,830	)
Foreign currency translation adjustments		829			(1,036	)
Gross carrying amount at end of period		40,385			39,556
Accumulated amortization at beginning of period		(35,330	)		(33,858	)
Amortization expense		(193	)		(2,037	)
Foreign currency translation adjustments		(784	)		565
Accumulated amortization at end of period		(36,307	)		(35,330	)
Net book value at end of period	$	4,078		$	4,226

The Company amortizes its intangible assets with finite lives on a straight-line basis over their respective estimated useful lives. Amortization of intangible assets totaled $193,000 and $833,000 for the three months ended September 30, 2012 and 2011, respectively. The carrying value of intangible assets at September 30, 2012 of $4.1 million will be amortized on a straight-line basis over the remaining estimated useful life of 5.25 years, or approximately $780,000 per year. Of the total net book value at September 30, 2012, approximately $2.8 million was attributable to the Durasert technology and $1.3 million was attributable to the BioSilicon technology.

In November 2011, the FDA issued the 2011 CRL and did not grant marketing approval for ILUVIEN for DME, and, as a result, the Company did not receive a $25.0 million milestone payment from Alimera and Alimera was unable to commence marketing ILUVIEN for DME in the U.S. Following the public announcement of the 2011 CRL, there was a significant decline in the Company’s share price, resulting in a decrease of the Company’s market capitalization from $82.0 million to $23.1 million at December 31, 2011. The combination of the 2011 CRL and the decline in the Company’s share price were determined to be impairment indicators of the Company’s finite-lived intangible assets, which resulted in a $14.8 million impairment write-down for the quarter ended December 31, 2011.