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Goodwill and Intangible Assets
 6 Months Ended
Jul. 01, 2022
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Intangible Assets
10.Intangible Assets
The gross carrying amount and accumulated amortization of intangible assets were comprised of the following at the end of each period:
SuccessorPredecessor
July 1, 2022December 31, 2021
Gross Carrying AmountAccumulated AmortizationGross Carrying AmountAccumulated Amortization
Amortizable:
Completed technology$2,918.9 $45.5 $10,404.0 $5,160.4 
License agreements—— 120.182.1
Trademarks—— 77.726.9
Total$2,918.9 $45.5 $10,601.8 $5,269.4 
Non-Amortizable:
Trademarks$— $35.0 
In-process research and development233.3 81.0 
Total$233.3 $116.0 

As part of fresh-start accounting, the Company wrote-off the existing intangible assets and accumulated amortization of the Predecessor and recorded $3,152.2 million to reflect the fair value of intangible assets of the Successor (see also Note 3). Such adjustment included $100.0 million in relation to the Company's PRV that was awarded under a FDA program intended to encourage the development of certain product applications for therapies used to treat or prevent material threat medical countermeasures. On June 30, 2022, subsequent to the Effective Date, the Company completed the sale of its PRV for $100.0 million and received net proceeds of $65.0 million as the buyer remitted the remaining $35.0 million to the General Unsecured Claims Trustee pursuant to the terms of (i) the Plan, and (ii) that certain General Unsecured Claims Trust Agreement entered into in connection with the Plan.
Intangible assets of the Successor as of July 1, 2022 consist of the following:
AmountAmortization Method
Amortization Period (in years)
Discount RateSegment
Amortizable completed technology:
Acthar Gel$1,069.0 Sum of the years digits13.514.2%Specialty Brands
Therakos913.8Sum of the years digits10.014.0Specialty Brands
Amitiza84.5 Sum of the years digits3.014.0Specialty Brands
INOmax652.9 Sum of the years digits9.014.0Specialty Brands
StrataGraft56.8 Straight-line11.014.0Specialty Brands
Generics71.4 Straight-line5.013.3Specialty Generics
APAP70.5 Straight-line20.513.0Specialty Generics
2,918.9 
Non-Amortizable in-process research and development:
Terlipressin104.8 Not applicableNot applicable15.0Specialty Brands
Generics IPR&D128.5 Not applicableNot applicable14.0Specialty Generics
233.3 
$3,152.2 
Amitiza
Beginning January 1, 2022 (Predecessor), the Company changed its amortization method used for the Amitiza intangible asset from the straight-line method to the sum of the years digits method, an accelerated method of amortization, to more accurately reflect the consumption of economic benefits over the remaining useful life of the asset. This change in amortization method resulted in additional amortization expense of $9.3 million and $21.7 million, which impacted basic loss per share by $0.11 and $0.26 for the period April 2, 2022 through June 16, 2022 (Predecessor) and the period January 1, 2022 through June 16, 2022 (Predecessor), respectively.
Terlipressin
During September 2020, the FDA issued a Complete Response Letter ("CRL") regarding the Company's New Drug Application ("NDA") seeking approval for the investigational agent terlipressin to treat adults with hepatorenal syndrome type 1 ("HRS-1"). The CRL stated that, based on the available data, the agency cannot approve the terlipressin NDA in its current form and requires more information to support a positive risk-benefit profile for terlipressin for patients with HRS-1.
In response to receipt of the CRL, the Company had an End of Review Meeting on October 26, 2020 and a Type A Meeting on January 29, 2021 with the FDA where both parties engaged in constructive dialogue in an effort to clarify a viable path to U.S. approval. On August 18, 2021, the Company resubmitted its NDA for terlipressin to the FDA and on February 18, 2022, the Prescription Drug User Fee Act (or "PDUFA") date, the FDA issued a CRL. In the weeks leading up to the PDUFA date, it became necessary for the Company to identify a new packaging and labeling manufacturing facility, which meant that an inspection by the FDA could not be completed by the PDUFA date. A satisfactory inspection is required before the NDA can be approved. This is the only outstanding issue noted in the CRL, and it is important to note that there were no safety or efficacy issues cited.
On June 9, 2022, the Company resubmitted its NDA for terlipressin to the FDA and currently expects the Prescription Drug User Fee Act (PDUFA) date to be December 9, 2022. The Company remains committed to this critically ill patient population, who currently have no approved treatment option in the U.S. for HRS-1 and believes that there is a path to approval in fiscal 2022. The Company will continue to assess the impact of any changes to planned revenue or earnings on the fair value of the associated in-process research and development asset of $104.8 million included within intangible assets, net on the unaudited condensed consolidated balance sheet as of July 1, 2022.
The Company annually tests the indefinite-lived intangible assets for impairment, or whenever events or changes in circumstances indicate that the carrying value may not be recoverable by either a qualitative or income approach. Management relies on a number of qualitative factors when considering a potential impairment such as changes to planned revenue or earnings that could affect significant inputs used to determine the fair value of the indefinite-lived intangible asset.
Intangible asset amortization expense
Intangible asset amortization expense was as follows:
SuccessorPredecessor
Period from
June 17, 2022
through
July 1, 2022		Period from
April 2, 2022
 through
June 16, 2022		Three Months Ended June 25, 2021
Amortization expense$45.5 $126.7 $145.2 
SuccessorPredecessor
Period from
June 17, 2022
through
July 1, 2022		Period from
January 1, 2022
 through
June 16, 2022		Six Months Ended June 25, 2021
Amortization expense$45.5 $281.8 $290.5 

The estimated aggregate amortization expense on intangible assets owned by the Company and being amortized as of July 1, 2022, is expected to be as follows:
Successor
Remainder of Fiscal 2022$269.5
Fiscal 2023491.7
Fiscal 2024428.5
Fiscal 2025367.6
Fiscal 2026319.9