Intangible Assets and Goodwill

12 Months Ended

Dec. 31, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets

Intangible assets, net of accumulated amortization, impairment charges and adjustments are summarized as follows:


		As of December 31, 2020						As of December 31, 2019
(In millions)	Estimated Life	Cost		Accumulated Amortization		Net		Cost		Accumulated Amortization		Net
Completed technology	4-28 years	$	7,394.3	$	(5,136.5)	$	2,257.8	$	7,379.3	$	(4,881.4)	$	2,497.9
In-process research and development	Indefinite until commercialization	762.5		—		762.5		965.5		—		965.5
Trademarks and trade names	Indefinite	64.0		—		64.0		64.0		—		64.0
Total intangible assets		$	8,220.8	$	(5,136.5)	$	3,084.3	$	8,408.8	$	(4,881.4)	$	3,527.4

Amortization and Impairments

Amortization and impairments of acquired intangible assets totaled $464.8 million, $489.9 million and $747.3 million for the years ended December 31, 2020, 2019 and 2018, respectively.

Amortization of acquired intangible assets, excluding impairment charges, totaled $255.1 million, $274.0 million and $381.2 million for the years ended December 31, 2020, 2019 and 2018, respectively. The decrease in amortization of acquired intangible assets, excluding impairment charges, over the three years was primarily due to a lower rate of amortization for acquired intangible assets.

For the year ended December 31, 2020, amortization and impairment of acquired intangible assets reflects the impact of a $115.0 million impairment charge related to BIIB111, which was obtained as part of our acquisition of NST, a $75.4 million impairment charge related to BIIB054 (cinpanemab) and a $19.3 million impairment charge related to one of our other IPR&D intangible assets.

For the year ended December 31, 2019, amortization and impairments of acquired intangible assets reflects the impact of a $215.9 million impairment charge related to certain IPR&D assets associated with the Phase 2b study of BG00011 (STX-100) for the potential treatment of idiopathic pulmonary fibrosis (IPF), which was discontinued in the third quarter of 2019.

For the year ended December 31, 2018, amortization and impairments of acquired intangible assets reflects the impact of a $189.3 million impairment charge related to certain IPR&D assets associated with our vixotrigine program, as discussed below, and a $176.8 million impairment charge related to our U.S. license to Forward Pharma A/S' (Forward Pharma) intellectual property, including Forward Pharma's intellectual property related to TECFIDERA.

Completed Technology

Completed technology primarily relates to our acquisition of all remaining rights to TYSABRI from Elan as well as other amounts related to our other marketed products and programs acquired through business combinations.

IPR&D Related to Business Combinations

IPR&D represents the fair value assigned to research and development assets that we acquired as part of a business combination and had not yet reached technological feasibility at the date of acquisition. Included in IPR&D balances are adjustments related to foreign currency exchange rate fluctuations. We review amounts capitalized as acquired IPR&D for impairment annually, as of October 31, and whenever events or changes in circumstances indicate to us that the carrying value of the assets might not be recoverable. The carrying value associated with our IPR&D assets as of December 31, 2020 and 2019, relates to the various IPR&D programs we acquired in connection with our acquisitions of NST and Convergence Pharmaceuticals Holdings Ltd. (Convergence). The majority of the balance relates to our acquisition of NST in June 2019 whereby we acquired IPR&D programs with an estimated fair value of approximately $585.0 million as of December 31, 2020. For additional information on our acquisition of NST, please read Note 2, Acquisitions, to these consolidated financial statements.

BIIB111

During the fourth quarter of 2020 we began experiencing third-party manufacturing delays that may impact our timeline for a potential filing of a Biologics License Application (BLA) for BIIB111 for regulatory approval by up to one year. In addition, we determined that forecasted costs associated with advancing the BIIB111 program through Phase 3 development and potential commercialization will exceed our original estimates. We reassessed the fair value of the program based on these changes in assumptions and determined that the program was partially impaired. We recognized an impairment charge of $115.0 million during the fourth quarter of 2020, which resulted in a reduction of the IPR&D asset from $480.0 million to $365.0 million.

BIIB054

In February 2021 we announced that we discontinued development of BIIB054 as a potential treatment of Parkinson's disease as our Phase 2 SPARK study did not meet its primary or secondary endpoints. Although we made this determination in February 2021, it was based on conditions that existed as of December 31, 2020. As a result, we recognized an impairment charge of approximately $75.4 million during the fourth quarter of 2020 to reduce the fair value of the related IPR&D intangible asset to zero.

The IPR&D impairment charges were included in amortization and impairment of acquired intangible assets and the gain resulting from the remeasurement of our contingent consideration obligation was recorded in (gain) loss on fair value remeasurement of contingent consideration in our consolidated statements of income. The fair value of the intangible assets and contingent consideration obligations were based on a probability-adjusted discounted cash flow calculation using Level 3 fair value measurements and inputs including estimated revenues, costs and probabilities of success.

Vixotrigine

In the periods since we acquired vixotrigine, there have been numerous delays in the initiation of Phase 3 studies for the potential treatment of TGN as we engaged with the U.S. Food and Drug Administration (FDA) regarding the design of the Phase 3 studies and awaited data and insights from mid-stage clinical trials of vixotrigine in other indications that have since been completed. The fair value of the TGN asset is not significantly in excess of carrying value. As of December 31, 2020, the carrying value associated with our vixotrigine IPR&D assets was $177.5 million.

Estimated Future Amortization of Intangible Assets

The estimated future amortization of finite-lived intangible assets for the next five years is expected to be as follows:


(In millions)	As of December 31, 2020
2021	$	205.0
2022	215.0
2023	215.0
2024	225.0
2025	220.0

Goodwill

The following table provides a roll forward of the changes in our goodwill balance:


	As of December 31,
(In millions)	2020		2019
Goodwill, beginning of year	$	5,757.8	$	5,706.4
Increase to goodwill	—		117.5
Elimination of goodwill allocated to Hillerød, Denmark manufacturing operations	—		(69.5)
Other	4.3		3.4
Goodwill, end of year	$	5,762.1	$	5,757.8

As of December 31, 2020, we had no accumulated impairment losses related to goodwill. Other includes adjustments related to foreign currency exchange rate fluctuations.