Intangible Assets and Goodwill

6 Months Ended

Jun. 30, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets

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


		As of June 30, 2021						As of December 31, 2020
(In millions)	Estimated Life	Cost		Accumulated Amortization		Net		Cost		Accumulated Amortization		Net
Completed technology	4-28 years	$	7,394.3	$	(5,252.7)	$	2,141.6	$	7,394.3	$	(5,136.5)	$	2,257.8
In-process research and development	Indefinite until commercialization	179.4		—		179.4		762.5		—		762.5
Trademarks and trade names	Indefinite	64.0		—		64.0		64.0		—		64.0
Total intangible assets		$	7,637.7	$	(5,252.7)	$	2,385.0	$	8,220.8	$	(5,136.5)	$	3,084.3

For the three and six months ended June 30, 2021, amortization and impairment of acquired intangible assets totaled $604.1 million and $702.2 million, respectively, compared to $61.5 million and $133.0 million, respectively, in the prior year comparative periods.

For the three and six months ended June 30, 2021, amortization and impairment of acquired intangible assets reflects a $350.0 million impairment charge related to BIIB111 (timrepigene emparvovec) for the potential treatment of choroideremia and a $191.6 million impairment charge related to BIIB112 (cotoretigene toliparvovec) for the potential treatment of X-linked retinitis pigmentosa.

For the six months ended June 30, 2021, amortization and impairment of acquired intangible assets also reflects a $44.3 million impairment charge related to vixotrigine (BIIB074) for the potential treatment of trigeminal neuralgia (TGN).

For the three and six months ended June 30, 2020, we had no impairment charges.

Completed Technology

Completed technology primarily relates to our acquisition of all remaining rights to TYSABRI 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 June 30, 2021, relates to the various IPR&D programs we acquired in connection with our acquisitions of Nightstar Therapeutics plc (NST) and Convergence Pharmaceuticals Holdings Ltd. (Convergence). For additional information on our acquisition of NST, please read Note 2, Acquisitions, to our consolidated financial statements included in our 2020 Form 10-K.

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 and for the potential treatment of diabetic painful neuropathy (DPN), another form of neuropathic pain. We have engaged with the FDA regarding the design of the Phase 3 studies of vixotrigine for the potential treatment of TGN and DPN and now plan to perform an additional clinical trial of vixotrigine before initiating a Phase 3 study of DPN.

The performance of this additional clinical trial has delayed the initiation of the Phase 3 studies of vixotrigine for the potential treatment of TGN, and, as a result, we recognized an impairment charge of $44.3 million related to vixotrigine for the potential treatment of TGN during the first quarter of 2021. As of June 30, 2021, the carrying value associated with our remaining vixotrigine IPR&D assets was $136.0 million, all of which is related to DPN.

BIIB111 and BIIB112

During the fourth quarter of 2020 we recognized an impairment charge of $115.0 million related to BIIB111 as a result of third-party manufacturing delays that impacted the timing and increased the costs associated with advancing BIIB111 through Phase 3 development.

During the second quarter of 2021 we announced that our Phase 3 STAR study of BIIB111 did not meet its primary or key secondary endpoints. We reassessed the fair value of the program based on the results of this study and recognized an impairment charge of $350.0 million during the second quarter of 2021, which resulted in a reduction of the IPR&D asset from $365.0 million to $15.0 million.

During the second quarter of 2021 we announced that our Phase 2/3 XIRIUS study of BIIB112 did not meet its primary endpoint; however, positive trends were observed across several clinically relevant prespecified secondary endpoints. We reassessed the fair value of the program based on the results of this study and recognized an impairment charge of $191.6 million during the second quarter of 2021, which resulted in a reduction of the IPR&D asset from $220.0 million to $28.4 million.

We are evaluating the results of our Phase 3 STAR study of BIIB111 and our Phase 2/3 XIRIUS study of BIIB112, including evaluation of any future development activities we may perform. Our estimates of the current fair values of the BIIB111 and BIIB112 programs were derived by using a discounted, probability-weighted calculation of future estimated cash flows associated with the programs under multiple scenarios, including the possibility that we will cease further development of BIIB111 and/or BIIB112, which could result in further impairment of these assets. The key assumptions in our estimates are the amount and timing of revenue, probability of technical and regulatory success, discount rate and clinical data associated with the programs.

In addition, we have entered into third-party manufacturing agreements related to the BIIB111 and BIIB112 programs and we may incur a financial penalty if these agreements are terminated. Should we decide to terminate either or both of these programs and/or manufacturing agreements, we will likely incur impairment charges related to the remaining book value of the applicable program as well as charges up to, in the aggregate, approximately $30.0 million related to our inventory arrangements and other costs associated with discontinuing these programs.

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 June 30, 2021
2021 (remaining six months)	$	110.0
2022	215.0
2023	215.0
2024	225.0
2025	220.0
2026	200.0

Goodwill

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


(In millions)	As of June 30, 2021
Goodwill, December 31, 2020	$	5,762.1

Other	1.8
Goodwill, June 30, 2021	$	5,763.9

As of June 30, 2021, we had no accumulated impairment losses related to goodwill. Other includes adjustments related to foreign currency exchange rate fluctuations.