Intangible Assets

6 Months Ended

Jun. 30, 2013

Notes to Financial Statements

Note 5. Intangible Assets

Intangible assets as of the balance sheet dates consisted of the following:

	June 30, 2013		December 31, 2012
Licensed patents and patent rights	$	63,200	$	50,000
Patents		41,004		41,004
Less: accumulated amortization		(62,730)		(59,024	)
Intangibles, net	$	41,474	$	31,980

The Company’s intangible assets consist of patents, licensed patents and patent rights, and website development costs, and are carried at the legal cost to obtain them. Costs to renew or extend the term of intangible assets are expensed when incurred. In 2008, through our formerly majority owned subsidiary, the Company also held technology licenses and other acquired intangibles. Intangible assets are amortized using the straight-line method over the estimated useful life. Useful lives are as follows: patents, 17 years; patents under licensing, 10 years; website development costs, three years, and in 2008, acquired intangibles had a weighted average life of 15 years. Amortization expense for the three and six months ended June 30, 2013 totaled $1,853 and $3,706, respectively. Amortization expense for the three and six months ended June 30, 2012 totaled $1,853 and $3,706 for the three and six months ended June 30, 2012, respectively. The estimated aggregate amortization expense for 2013 through 2015 is $7,412 for each year.    

On March 1, 2013, the Company entered into an Exchange Agreement with NuRx and QND, pursuant to which the Company exchanged its Settlement Shares for certain patents, trademarks and other intellectual property formerly held by NuRx and QND covering point-of-care lateral flow diagnostics (RapidSenseTM) and related oral fluid collection technologies.  The Company has recorded the value associated with this exchange at $13,200, and will amortize these costs over the remaining useful lives of the intellectual property exchanged.