3. OWNERSHIP INTERESTS IN AND ADVANCES TO PARTNER COMPANIES

The following summarizes the carrying value of the Company’s ownership interests in and advances to partner companies and private equity funds.


	September 30, 2011		December 31, 2010
	(In thousands)
	(Unaudited)
Equity Method:
Partner companies	$	105,359	$	50,561
Private equity funds		5,860		2,265

		111,219		52,826

Cost Method:
Private equity funds		2,984		2,908

Advances to partner companies		3,214		4,522


	$	117,417	$	60,256


Available-for-sale securities	$	5,694	$	25,447

In the third quarter of 2011, Portico Systems, Inc. (“Portico”), formerly an equity method partner company was acquired by McKesson . The Company received cash proceeds in exchange for its equity interests of approximately $32.8 million, excluding $3.4 million which will be held in escrow for a period of one year. In addition, depending on the achievement of certain milestones, the Company may receive an additional $1.9 million after a period of one year. Portico also repaid its mezzanine loan facility with the Company in the principal amount of $5.0 million in connection with the transaction. The Company recorded a gain of $35.4 million on the transaction which is recorded in Equity income (loss) in the Consolidated Statement of Operations.

In the second quarter of 2011, Advanced BioHealing, Inc. (“Advanced BioHealing”), formerly an equity method partner company, was acquired by Shire plc, resulting in net sale proceeds to the Company of $137.9 million, excluding cash held in escrow of $7.6 million. The Company recognized a gain on sale of $129.0 million which is reflected in Equity income (loss) in the Consolidated Statement of Operations.

The Company recognized an impairment charge of $1.4 million related to SafeCentral, Inc. in the first quarter of 2011 which is reflected in Equity income (loss) in the Consolidated Statement of Operations for the nine months ended September 30, 2011, due to modifications to the strategic direction of the business and changes in executive management at SafeCentral.

The Company recognized an impairment charge of $0.4 million in the third quarter of 2011 which is reflected in Other income (loss), net, in the Consolidated Statements of Operations, representing the unrealized loss on the mark-to-market of its ownership interest in Tengion, which was previously recorded as a separate component of equity. The Company had previously recognized impairment charges of $0.3 million and $0.8 million in the first and second quarters of 2011, respectively. Following the impairment charge, the Company’s adjusted cost basis in Tengion was $0.3 million. The Company determined that the decline in the value of its public holdings in Tengion was other than temporary. The Company also recognized impairment charges on its holdings in Tengion of $2.1 million and $1.1 million in the first and third quarters of 2010 respectively.

For the three and nine months ended September 30, 2010 the Company recognized unrealized gains of $9.2 million and $22.4 million, respectively, on the mark-to-market of its holdings in Clarient which is included in Other income (loss), net in the Consolidated Statements of Operations.