Note 7 - Intangible Assets

9 Months Ended

Mar. 31, 2024

Notes to Financial Statements

Intangible Assets Disclosure [Text Block]

Note 7 - Intangible Assets

A summary of the Company’s intangible assets as of March 31, 2024, and June 30, 2023, respectively, is as follows:

	March 31, 2024
	Carrying Amount		Accumulated Amortization			Net Carrying Amount		Weighted-Average Remaining Life
	(in thousands)							(in years)
Definite-lived intangibles:
Acquired product technology rights	$	41,467	$	(12,580	)	$	28,887		10.89
Acquired technology right		30,200		(5,387	)		24,813		14.00
Acquired product distribution rights		6,207		(5,825	)		382		0.25
Total intangible assets	$	77,874	$	(23,792	)	$	54,082		12.24

	June 30, 2023
	Carrying Amount		Accumulated Amortization			Net Carrying Amount		Weighted-Average Remaining Life
	(in thousands)							(in years)
Definite-lived intangibles:
Acquired product technology rights	$	42,176	$	(10,881	)	$	31,295		11.49
Acquired technology right		30,200		(4,054	)		26,146		14.75
Acquired product distribution rights		6,207		(4,678	)		1,529		1.00
Total intangible assets	$	78,583	$	(19,613	)	$	58,970		12.67

Carrying amounts are net of any impairment charges from prior periods. An intangible asset with zero net carrying amount at the end of a reporting period is not presented in the table of a future reporting period. Certain of the Company’s amortizable intangible assets include renewal options, extending the expected life of the asset. The renewal periods range between approximately 1 to 20 years depending on the license, patent or other agreement. Renewals are accounted for when they are reasonably assured. Intangible assets are amortized using the straight-line method over the estimated useful lives. Amortization expense of intangible assets was $1.6 million and $1.5 million for the three months ended March 31, 2024, and 2023, respectively, and $4.9 million and $4.6 million for the nine months ended March 31, 2024, and 2023, respectively.

The following table summarizes the estimated future amortization expense to be recognized over the next five fiscal years and periods thereafter:

	March 31,
	(in thousands)
2024 (remaining 3 months)	$	1,630
2025		4,989
2026		4,989
2027		4,989
2028		4,989
2029		4,989
Thereafter		27,507
Total future amortization expense	$	54,082

Acquired Product Technology Rights

The acquired product technology rights are related to the rights to production, supply and distribution agreements of various products pursuant to the acquisitions of the Pediatric Portfolio in November 2019 and the Neos Acquisition in March 2021.

Karbinal ER

The Company acquired and assumed all rights and obligations pursuant to the Supply and Distribution Agreement, as amended, with Tris Pharma, Inc. (“Tris”) for the exclusive rights to commercialize Karbinal ER in the United States (the “Tris Karbinal Agreement”). The Tris Karbinal Agreement’s initial term terminates in August of 2033, with an optional additional 20-year extension.

Poly-Vi-Flor and Tri-Vi-Flor

The Company acquired and assumed all rights and obligations pursuant to a Supply and License Agreement and various assignment and release agreements, including a previously agreed to Settlement and License Agreements (the “Poly-Tri Agreements”) for the exclusive rights to commercialize Poly-Vi-Flor and Tri-Vi-Flor in the United States.

ADHD Portfolio

As part of the Neos Acquisition, the Company acquired product technology for the production and sale of Adzenys XR-ODT and Cotempla XR-ODT. The formulations for the ADHD products are protected by patented technology. The estimated economic life of these proprietary technologies is 17 years.

Acquired Technology Right

TRRP Technology

As part of the Neos Acquisition, the Company acquired Time Release Resin Particle (“TRRP”) proprietary technology, which is a proprietary drug delivery technology protected by the Company as a trade secret that allows the Company to modify the drug release characteristics of each of its respective products. The TRRP technology underlies the ADHD portfolio and can potentially be used in future product development initiatives as well.

Acquired Product Distribution Rights (and customer list)

In connection with the Innovus Acquisition, the Company obtained 35 products with a combination of over 300 registered trademarks and/or patent rights and customer lists. The customer lists are fully amortized. During the fourth quarter of fiscal 2023, the acquired product distribution rights incurred an impairment charge of $3.0 million due to the discontinuation of products in the Consumer Health Segment.

Acquired In-Process R&D

IPR&D – NT0502

As part of the Neos Acquisition, the Company acquired in-process research and development associated with NT0502, a new chemical entity being developed for the treatment of sialorrhea, which is excessive salivation or drooling. As this is an indefinite-lived intangible asset, this acquired asset remains an indefinite-lived asset until the completion or abandonment of the associated research and development efforts. If a product using this technology is eventually approved for commercial sale, at that time, the IPR&D will begin amortizing on a straight-line basis over the life of the product. During fiscal 2023, the Company terminated its development program of NT0502. As a result, the Company fully impaired the IPR&D of NT0502, recording impairment expense of $2.6 million to its Rx Segment during the second quarter of fiscal 2023.