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Other Intangible Assets, Net
9 Months Ended
Sep. 30, 2011
Other Intangible Assets, Net 
Intangible Assets Disclosure

9.       Other intangible assets, net

  September 30,December 31,
  20112010
  $’M $’M
  ________________________________
Amortized intangible assets  
 Intellectual property rights acquired for currently marketed products2,522.22,516.4
 Acquired product technology710.0-
 Other intangible assets23.722.0
  ________________________________
  3,255.92,538.4
Unamortized intangible assets  
 Intellectual property rights acquired for In-process R&D (“IPR&D”)123.5139.7
  ________________________________
  3,379.42,678.1
    
Less: Accumulated amortization(817.7)(699.2)
  ________________________________
  2,561.71,978.9
  ________________________________

At September 30, 2011 the net book value of intangible assets allocated to the SP segment was $ 1,389.5 million (December 31, 2010: $1,482.9 million), to the HGT segment was $470.7 million (December 31, 2010: $496.0 million) and to the RM segment was $701.5 million (December 31, 2010: $nil).

 

The change in the net book value of other intangible assets for the nine months to September 30, 2011 and 2010 is shown in the table below:

 Other intangible assets
 20112010
 $’M$’M
 ________________________________
As at January 1, 1,978.91,790.7
Acquisitions717.12.7
Amortization charged (120.5)(100.9)
Impairment charges(16.0)-
Impairment on re-measurement of DAYTRANA to fair value less costs to sell-(42.7)
Reclassification of DAYTRANA to assets held for sale-(56.0)
Foreign currency translation2.2(26.6)
 ________________________________
As at September 30, 2,561.71,567.2
 ________________________________

In the nine months to September 30, 2011 the Company acquired intangible assets totaling $717.1 million, principally relating to DERMAGRAFT product technology acquired with ABH (see Note 2 for further details). The weighted average amortization period of acquired amortizable intangible assets is 18 years.

 

In the three and nine months to September 30, 2011 the Company recorded impairment charges of $16.0 million (2010: $nil) in respect of certain IPR&D intangible assets. The impairment charge has been recorded within R&D in the SP operating segment.

 

On August 10, 2010 the Company divested DAYTRANA to Noven. On approval of the divestment, the held for sale criteria were met, and the Company recognized an impairment loss of $42.7 million to record the DAYTRANA disposal group at the lower of its carrying amount or fair value less costs to sell. The impairment loss was recorded to selling, general and administrative expenses in the three and nine months to September 30, 2010. The divestment became effective on October 1, 2010. No consideration was received at the time of divestment; however future consideration is receivable from Noven dependent on DAYTRANA's future performance. On divestment, Shire recorded the then fair value of the contingent consideration receivable from Noven ($56.0 million) within current assets and non-current assets. No gain or loss was recorded on divestiture.

 

Management estimates that the annual amortization charge in respect of intangible assets held at September 30, 2011 will be approximately $183 million for each of the five years to September 30, 2016. Estimated amortization expense can be affected by various factors including future acquisitions, disposals of product rights, regulatory approval and subsequent amortization of the acquired IPR&D projects, foreign exchange movements and the technological advancement and regulatory approval of competitor products.