Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2020

Fair Value Disclosures [Abstract]

Schedule of cash and cash equivalents

The following table presents current and noncurrent restricted cash and cash equivalent balances at March 31, 2020 and December 31, 2019 (in thousands):

	March 31, 2020		December 31, 2019
Restricted cash and cash equivalents—current portion (1)	$	200,666	$	247,457
Restricted cash and cash equivalents—noncurrent portion (2)	18,400		18,400
Restricted cash and cash equivalents—total (3)	$	219,066	$	265,857

__________

(1) These amounts are reported in our Condensed Consolidated Balance Sheets as Restricted cash and cash equivalents.

(2) These amounts are reported in our Condensed Consolidated Balance Sheets as Other assets.

(3)

Approximately $195.7 million and $242.8 million of our restricted cash and cash equivalents are held in Qualified Settlement Funds (QSFs) for mesh-related matters at March 31, 2020 and December 31, 2019, respectively. The remaining restricted cash and cash equivalents primarily relates to other litigation-related matters. See Note 12. Commitments and Contingencies for further information.

Restrictions on cash and cash equivalents

The following table presents current and noncurrent restricted cash and cash equivalent balances at March 31, 2020 and December 31, 2019 (in thousands):

	March 31, 2020		December 31, 2019
Restricted cash and cash equivalents—current portion (1)	$	200,666	$	247,457
Restricted cash and cash equivalents—noncurrent portion (2)	18,400		18,400
Restricted cash and cash equivalents—total (3)	$	219,066	$	265,857

__________

(1) These amounts are reported in our Condensed Consolidated Balance Sheets as Restricted cash and cash equivalents.

(2) These amounts are reported in our Condensed Consolidated Balance Sheets as Other assets.

(3)

Approximately $195.7 million and $242.8 million of our restricted cash and cash equivalents are held in Qualified Settlement Funds (QSFs) for mesh-related matters at March 31, 2020 and December 31, 2019, respectively. The remaining restricted cash and cash equivalents primarily relates to other litigation-related matters. See Note 12. Commitments and Contingencies for further information.

Financial assets and liabilities measured at fair value on recurring basis

The Company’s financial assets and liabilities measured at fair value on a recurring basis at March 31, 2020 and December 31, 2019 were as follows (in thousands):

	Fair Value Measurements at March 31, 2020 using:
	Level 1 Inputs		Level 2 Inputs		Level 3 Inputs		Total
Assets:
Money market funds	$	635,365	$	—	$	—	$	635,365
Liabilities:
Acquisition-related contingent consideration—current	$	—	$	—	$	8,459	$	8,459
Acquisition-related contingent consideration—noncurrent	$	—	$	—	$	30,480	$	30,480

	Fair Value Measurements at December 31, 2019 using:
	Level 1 Inputs		Level 2 Inputs		Level 3 Inputs		Total
Assets:
Money market funds	$	427,033	$	—	$	—	$	427,033
Liabilities:
Acquisition-related contingent consideration—current	$	—	$	—	$	6,534	$	6,534
Acquisition-related contingent consideration—noncurrent	$	—	$	—	$	23,123	$	23,123

Changes to liability for acquisition-related contingent consideration

The following table presents changes to the Company’s liability for acquisition-related contingent consideration, which is measured at fair value on a recurring basis using significant unobservable inputs (Level 3), for the three months ended March 31, 2020 and 2019 (in thousands):

	Three Months Ended March 31,
	2020			2019
Beginning of period	$	29,657		$	116,703
Amounts settled	(2,461		)	(11,591		)
Changes in fair value recorded in earnings	12,462			(37,501		)
Effect of currency translation	(719		)	231
End of period	$	38,939		$	67,842

The following table presents changes to the Company’s liability for acquisition-related contingent consideration during the three months ended March 31, 2020 by acquisition (in thousands):

	Balance as of December 31, 2019		Changes in Fair Value Recorded in Earnings			Amounts Settled and Other			Balance as of March 31, 2020
Auxilium acquisition	$	13,207	$	(54	)	$	—		$	13,153
Lehigh Valley Technologies, Inc. acquisitions	6,800		12,897			(2,097		)	17,600
Other	9,650		(381		)	(1,083		)	8,186
Total	$	29,657	$	12,462		$	(3,180	)	$	38,939

Summary of nonrecurring fair value measurements

The Company’s financial assets and liabilities measured at fair value on a nonrecurring basis during the three months ended March 31, 2020 were as follows (in thousands):

	Fair Value Measurements during the Three Months Ended March 31, 2020 (1) using:						Total Expense for the Three Months Ended March 31, 2020
	Level 1 Inputs		Level 2 Inputs		Level 3 Inputs
Intangible assets, excluding goodwill (2)	$	—	$	—	$	24,377	$	(63,751	)
Certain property, plant and equipment	—		—		—		(1,248		)
Total	$	—	$	—	$	24,377	$	(64,999	)

__________

(1) The fair value amounts are presented as of the date of the fair value measurement as these assets are not measured at fair value on a recurring basis. Such measurements generally occur in connection with our quarter-end financial reporting close procedures.

(2)

These fair value measurements were determined using risk-adjusted discount rates ranging from approximately 10.0% to 12.0% (weighted average rate of approximately 11.1%, weighted based on relative fair value). The Company also performed fair value measurements in connection with its goodwill impairment tests. Refer to Note 8. Goodwill and Other Intangibles for additional information on goodwill and other intangible asset impairment tests, including information about the valuation methodologies utilized.