XML 24 R13.htm IDEA: XBRL DOCUMENT

GOODWILL AND INTANGIBLE ASSETS

9 Months Ended

Sep. 30, 2021

NOTE 7 – GOODWILL AND INTANGIBLE ASSETS

The Company incurred $0.07 and $0.01 million of legal patent costs that were capitalized during the nine months ended June, 2021 and 2020, respectively. During the year ended December 31, 2020, the Company acquired from Sera Labs customer relationships at a fair value of $7.1 million, $2.6 million in Tradename intangibles, $0.5 million in non-compete and $4.7 million in Goodwill from the acquisition of Sera Labs. During the year ended December 31, 2019, the Company acquired from the CHI acquisition patents at a fair value of $0.7 million, $14.5 million in Intellectual Property Research & Development and $9.2 million in Goodwill from the acquisition of CHI.

Intangible Asset Summary

As of September 30, 2021 and December 31, 2020, goodwill and intangible assets, net, consisted of the following (in thousands):

	September 30, 2021			December 31, 2020
Goodwill ⁽¹⁾	$	13,868		$	13,868

Intangible assets:
Acquired IPR&D – Chemistry ⁽²⁾	$	502		$	14,460
Pending patents – Cure Pharmaceutical		327			259
Intangible assets subject to amortization:
Customer relationships ⁽²⁾		7,110			7,110
Acquired IPR&D – Chemistry ⁽²⁾		13,958			-
Tradename ⁽²⁾		2,610			2,610
Noncompete ⁽²⁾		462			462
Intellectual property		972			972
Issued patents		1,034			1,044
Total intangible assets		26,975			26,917
Accumulated amortization		(3,744	)		(1,312	)
Intangible assets, net	$	23,231		$	25,605

(1)	Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in the Merger (see Note 19). In 2020, the Company recorded additional goodwill of $4.7 million as a result of the Sera Labs acquisition.

(2)	See Note 19 for information on the Mergers which were consummated in May 2019 and October 2020.

During the three and nine months ended September 30, 2021 the Company completed a portion of their IPR&D project and begin amortizing $3.5 million and $13.9 million over its estimated useful life of 10 years on a straight-line basis.

Amortization expense was $1.0 million and $0.03 million for the three months ended September 30, 2021 and 2020, respectively. Amortization expense was $2.4 million and $0.09 million for the nine months ended September 30, 2021 and 2020, respectively.

The estimated aggregate amortization expense over each of the next five years is as follows (in thousands):

2021 (remaining)	$	953
2022		3,765
2023		3,592
2024		3,429
2025		2,583
Thereafter		8,080
Total Amortization	$	22,402