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Composition of Certain Financial Statement Captions
 12 Months Ended
Dec. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Composition of Certain Financial Statement Captions Composition of Certain Financial Statement Captions
 
For the years ended December 31,
(In thousands)
2019
 
2018
Accounts receivable, net
 
 
 
Accounts receivable
$
136,551

 
$
145,665

Less: allowance for doubtful accounts
(1,934
)
 
(1,758
)
 
$
134,617

 
$
143,907

Inventories, net
 
 
 
Consumable supplies
$
23,005

 
$
23,264

Finished products
25,142

 
15,259

Work in-process
3,238

 
2,473

Raw materials
4,586

 
4,259

Less: inventory reserve
(2,537
)
 
(2,956
)
 
$
53,434

 
$
42,299

Other current assets and prepaid expenses
 
 
 
Taxes recoverable
$
19,808

 
$
15,708

Other receivables
$
3,262

 
$
2,368

Prepaid supplies
8,147

 
9,693

Prepaid insurance
3,486

 
3,436

Other
15,839

 
3,847

 
$
50,542

 
$
35,052

Property, plant and equipment, net:
 
 
 
Machinery, medical and other equipment
$
165,501

 
$
147,757

Leasehold improvements
33,606

 
34,607

Furniture and fixtures
12,631

 
12,737

Automobiles and aircraft
10,029

 
10,133

Software
13,861

 
13,425

Building
18,462

 
18,554

Land
2,422

 
2,453

Construction in process
7,044

 
16,670

Less: accumulated depreciation
(136,445
)
 
(111,662
)
 
$
127,111

 
$
144,674

Intangible assets, net:
 
 
 
Customer relationships
$
445,408

 
$
446,296

Technologies
296,246

 
340,729

Trade names
49,786

 
50,404

Covenants not to compete
16,318

 
16,322

Licenses
5,766

 
5,766

Product registrations
7,578

 
7,861

Other
6,094

 
5,613

Less: accumulated amortization
(298,234
)
 
(258,539
)
 
$
528,962

 
$
614,452


 
For the years ended December 31,
(In thousands)
2019
 
2018
Accrued expenses:
 
 
 
Contract liabilities
$
19,196

 
$
63,503

Employee benefits
33,671

 
45,621

Commitments and Contingencies
38,635

 
15,327

Clinical trials
8,122

 
10,401

Professional fees
1,333

 
2,952

Finance leases short-term
2,743

 
3,280

Milestone payment
—

 
4,871

Contingent consideration
2,375

 
2,375

Other
58,850

 
55,183

 
$
164,925

 
$
203,513

 
 
 
 
Other long-term liabilities:
 
 
 
Line of credit
$
44,749

 
$
105,198

Contract liabilities
2,571

 
27,566

Contingent consideration
7,308

 
22,162

Finance leases long-term
4,046

 
5,620

Mortgages and other debts payable
3,906

 
4,654

Other
25,224

 
33,768

 
$
87,804

 
$
198,968


Our intangible assets and goodwill relate principally to our completed acquisitions of OPKO Renal, OPKO Biologics, EirGen and BioReference. We amortize intangible assets with definite lives on a straight-line basis over their estimated useful lives. The estimated useful lives by asset class are as follows: technologies - 7-17 years, customer relationships - 7-20 years, product registrations - 7-10 years, covenants not to compete - 5 years, trade names - 5-10 years, other 9-13 years. We do not anticipate capitalizing the cost of product registration renewals, rather we expect to expense these costs, as incurred. Our goodwill is not tax deductible for income tax purposes in any jurisdiction in which we operate.
The changes in value of the intangible assets and goodwill during the year ended December 31, 2019 are primarily due to an impairment charge of $44.8 million to write our IPR&D assets for OPK88003 and CURNA’s platform technology for oligonucleotide therapeutics down to their estimated fair value, a goodwill impairment charge of $26.2 million to write the carrying amount of the OPKO Diagnostics, CURNA and Transition Therapeutics reporting units down to their estimated fair value, and an impairment charge of $20.7 million to write our intangible asset for the Claros Analyzer down to its estimated fair value. The changes in value of the intangible assets during the year ended December 31, 2018 are primarily due to an impairment charge of $10.1 million to write our IPR&D assets for Alpharen and OPK88004 down to their estimated fair value. The value of our intangible assets and goodwill for the years ended December 31, 2019 and 2018 were also affected by foreign currency fluctuations between the Chilean Peso, the Euro and the Shekel against the U.S. dollar.
The following table reflects the changes in the allowance for doubtful accounts, provision for inventory reserve and tax valuation allowance accounts:
(In thousands)
Beginning
balance
 
Charged
to
expense
 
Written-off
 
Ending
balance
2019
 
 
 
 
 
 
 
Allowance for doubtful accounts
$
(1,758
)
 
(469
)
 
293

 
$
(1,934
)
Inventory reserve
$
(2,956
)
 
(2,349
)
 
2,768

 
$
(2,537
)
Tax valuation allowance
$
(154,916
)
 
(38,340
)
 
—

 
$
(193,256
)
2018
 
 
 
 
 
 
 
Allowance for doubtful accounts
$
(1,446
)
 
(665
)
 
353

 
$
(1,758
)
Inventory reserve
$
(6,565
)
 
(1,915
)
 
5,524

 
$
(2,956
)
Tax valuation allowance
$
(142,062
)
 
(12,854
)
 
—

 
$
(154,916
)

The following table summarizes the changes in Goodwill by reporting unit during the years ended December 31, 2019 and 2018.
 
2019
 
2018
(In thousands)
Balance at January 1
 
Goodwill impairment
 
Foreign exchange and other
 
Balance at December 31st
 
Balance at January 1
 
Goodwill impairment
 
Foreign exchange and other
 
Balance at December 31
Pharmaceuticals
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
CURNA
$
4,827

 
$
(4,827
)
 
$
—

 
$
—

 
$
4,827

 
$
—

 
$
—

 
$
4,827

Rayaldee
87,314

 
—

 
(1,709
)
 
85,605

 
91,295

 
—

 
(3,981
)
 
87,314

FineTech
—

 
—

 
—

 
—

 
11,698

 
(11,698
)
 
—

 
—

OPKO Biologics
139,784

 

 
—

 
139,784

 
139,784

 
—

 
—

 
139,784

OPKO Chile
4,614

 

 
(266
)
 
4,348

 
5,203

 
—

 
(589
)
 
4,614

OPKO Health Europe
7,546

 

 
(152
)
 
7,394

 
7,898

 
—

 
(352
)
 
7,546

Transition Therapeutics
3,322

 
(3,421
)
 
99

 
—

 
3,608

 
—

 
(286
)
 
3,322

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Diagnostics
 
 
 
 
 
 
 
 

 

 

 

BioReference
434,809

 
—

 
—

 
434,809

 
434,809

 
—

 
—

 
434,809

OPKO Diagnostics
17,977

 
(17,977
)
 
—

 
—

 
17,977

 
—

 
—

 
17,977

 
$
700,193

 
$
(26,225
)
 
$
(2,028
)
 
$
671,940

 
$
717,099

 
$
(11,698
)
 
$
(5,208
)
 
$
700,193