Intangible Assets and Goodwill

U.S. GAAP requires that goodwill and intangible assets with indefinite lives be assessed annually for impairment. The Company completed its annual impairment test for

2019

in the fiscal

fourth

quarter. In performing the assessment, the Company used current market capitalization, discounted future cash flows, internal forecasts and other factors as the best evidence of fair value. These assumptions represent Level

inputs. The assessment determined that the carrying amount for the Company’s fair value of its intangible assets and goodwill exceeded its carrying value and

impairment loss existed for the year ended

December 31, 2019.

Future impairment tests will be performed annually in the fiscal

fourth

quarter, or sooner if conditions exist that

may

represent an impairment.

During the year ended

December 31, 2018,

the Company experienced a significant and sustained decline in its stock price. The decline resulted in the Company’s market capitalization falling significantly below the recorded value of its consolidated net assets. As a result, the Company performed a quantitative assessment as of

June 30, 2018

and computed a fair value for its intangible assets and goodwill. The assessment determined that the carrying amount for the Company’s goodwill exceeded the estimated fair value in

2018.

Additionally, the Company’s indefinite-lived intangible assets, relating to the clinical protocols was also determined to be impaired. Also, the Company has significantly reduced its operating activities in India and impaired the remaining goodwill and substantially all of the intangible assets including the remainder of the clinical protocols, associated with the acquisition of our Totipotent subsidiaries. As a result, the Company recorded an impairment loss in the year ended

December 31, 2018.

	Intangible Assets			Goodwill
Balance at December 31, 2017, net	$	21,629,000		$	13,976,000

Amortization and foreign exchange		(152,000	)		--

Impairment loss		(19,886,000	)		(13,195,000	)

Balance at December 31, 2018, net	$	1,591,000		$	781,000

Amortization and foreign exchange		(124,000	)		--

Balance at December 31, 2019, net	$	1,467,000		$	781,000

Intangible assets consist of the following based on the Company’s determination of the fair value of identifiable assets acquired:

	As of December 31, 2019
	Weighted Average Amortization Period (in Years)	Gross Carrying Amount		Accumulated Amortization		Impairment		Net
Trade names	3	$	53,000	$	45,000	$	--	$	8,000
Developed technology	10		318,000		79,000		--		239,000
Licenses	7		437,000		367,000		--		70,000
Device registration	7		66,000		66,000		--		--
Customer relationships	3		443,000		436,000		--		7,000
Amortizable intangible assets			1,317,000		993,000		--		324,000
In process technology			1,143,000		--		--		1,143,000
Clinical protocols			--		--		--		--
Total		$	2,460,000	$	993,000	$	--	$	1,467,000

	As of December 31, 2018
	Weighted Average Amortization Period (in Years)	Gross Carrying Amount		Accumulated Amortization		Impairment		Net
Trade names	3	$	54,000	$	38,000			$	16,000
Developed technology	10		318,000		48,000				270,000
Licenses	7		448,000		307,000				141,000
Device registration	7		84,000		68,000	$	16,000		--
Customer relationships	3		451,000		430,000		--		21,000
Amortizable intangible assets			1,355,000		891,000		16,000		448,000
In process technology			1,143,000		--		--		1,143,000
Clinical protocols			19,870,000		--		19,870,000		--
Total		$	22,368,000	$	891,000	$	19,886,000	$	1,591,000

The change in the gross carrying amount is due to foreign currency exchange fluctuations and the write-off of assets for impairment. Amortization of intangible assets was

$124,000

for the year ended

December 31, 2019

and

$131,000

for the year ended

December 31, 2018.

In process technology has

not

yet been introduced to the market place and is therefore

not

yet subject to amortization. Clinical protocols were

not

introduced to the market place and is therefore were

not

subject to amortization prior to being written off during the year ended

December 31, 2018.

The Company’s estimated future amortization expense for amortizable intangible assets in subsequent years, are as follows:

Year Ended December 31,
2020		109,000
2021		40,000
2022		32,000
2023		32,000
2024		32,000
Thereafter		79,000
Total	$	324,000