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Leases
6 Months Ended
Jun. 30, 2020
Leases [Abstract]  
LEASES LEASES
We have operating leases for office space, laboratory operations, research and development facilities, manufacturing locations, warehouses and certain equipment. We determine if a contract contains a lease at inception or modification of a contract. Our leases generally do not provide an implicit interest rate, and we therefore use our incremental borrowing rate as the discount rate when measuring operating lease liabilities. The incremental borrowing rate represents an estimate of the interest rate we would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of the lease within a particular currency environment. We used the incremental borrowing rates as of January 1, 2019 for operating leases that commenced prior to that date. Many of our leases contain rental escalation, renewal options and/or termination options that are factored into our determination of lease payments as appropriate. Variable lease payment amounts that cannot be determined at the commencement of the lease are not included in the right-to-use assets or liabilities.
The following table presents the lease balances within the Condensed Consolidated Balance Sheet as of June 30, 2020:
(in thousands)Classification on the Balance SheetJune 30, 2020December 31, 2019
Assets
Operating lease assetsOperating lease right-of-use assets$38,469  $39,380  
Finance lease assetsProperty, plant and equipment, net5,395  6,789  
Liabilities
Current
Operating lease liabilitiesCurrent maturities of operating leases10,298  12,038  
Accrued expensesCurrent maturities of finance leases2,435  2,743  
Long-term
Operating lease liabilitiesOperating lease liabilities28,759  27,665  
Other long-term liabilitiesFinance lease liabilities$2,960  $4,046  
Weighted average remaining lease term
Operating leases5.7 years5.6 years
Finance leases2.5 years2.6 years
Weighted average discount rate
Operating leases6.4 %6.3 %
Finance leases3.9 %3.0 %
The following table reconciles the undiscounted future minimum lease payments (displayed by year and in the aggregate) under noncancelable operating leases with terms of more than one year to the total operating lease liabilities recognized on our Condensed Consolidated Balance Sheet as of June 30, 2020:
(in thousands)OperatingFinance
July 1, 2020 through December 31, 2020$6,604  $1,404  
20217,479  2,186  
20226,506  1,175  
20235,845  590  
20244,671  249  
Thereafter17,374  —  
Total undiscounted future minimum lease payments48,479  5,604  
Less: Difference between lease payments and discounted lease liabilities9,422  209  
Total lease liabilities$39,057  $5,395  
Expense under operating leases and finance leases was $9.7 million and $1.2 million, respectively, for the six months ended June 30, 2020, which includes $1.6 million of variable lease costs. Expense under operating leases and finance leases was $9.8 million and $2.0 million, respectively, for the six months ended June 30, 2019, which includes $1.7 million of variable lease costs. Operating lease costs and finance lease costs are included within Operating loss in the Condensed Consolidated Statement of Operations. Short-term lease costs were not material.
Supplemental cash flow information is as follows:
(in thousands)For the six months ended June 30,
20202019
Operating cash out flows from operating leases$9,804  $10,804  
Operating cash out flows from finance leases86  234  
Financing cash out flows from finance leases1,026  1,590  
Total$10,916  $12,628