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Intangible assets and goodwill

3 Months Ended

Mar. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

12. Intangible assets and goodwill

Definite-lived intangibles

Definite lived intangible assets consisted of the following at March 31, 2023 and December 31, 2022:


		Ending Balance at				Reclass from				Foreign		Ending Balance at
Definite lived		December 31,				Indefinite Lived to				currency		March 31,
intangibles assets, gross		2022		Additions		Definite Lived		Impairment		translation		2023
Emflaza	$	420,253	$	17,515		—		—		—	$	437,768
Waylivra		9,316		—		—		—		170		9,486
Tegsedi		7,109		2,001		—		—		131		9,241
Upstaza		89,550		—		—		—		—		89,550
Total definite lived intangibles, gross	$	526,228	$	19,516	$	—	$	—	$	301	$	546,045


		Ending Balance at				Foreign		Ending Balance at
Definite lived		December 31,				currency		March 31,
intangibles assets, accumulated amortization		2022		Amortization		translation		2023
Emflaza	$	(266,023)	$	(36,996)	$	—	$	(303,019)
Waylivra		(2,751)		(261)		(52)		(3,064)
Tegsedi		(1,709)		(292)		(36)		(2,037)
Upstaza		(3,420)		(1,866)		—		(5,286)
Total definite lived intangibles, accumulated amortization	$	(273,903)	$	(39,415)	$	(88)	$	(313,406)

Total definite lived intangibles, net							$	232,639

Marathon is entitled to receive contingent payments from the Company based on annual net sales of Emflaza beginning in 2018, up to a specified aggregate maximum amount over the expected commercial life of the asset. In accordance with the guidance for an asset acquisition, the Company records the milestone payment when it becomes payable to Marathon and increase the cost basis for the Emflaza rights intangible asset. For the three months ended March 31, 2023 and 2022, total milestone payments of $17.5 million and $62.1 million were recorded, respectively, which included a $50.0 million sales-based milestone during the three months ended March 31, 2022. These payments are being amortized over the remaining useful life of the Emflaza rights asset on a straight line basis. As of March 31, 2023, a milestone payable to Marathon of $17.5 million was recorded on the balance sheet within accounts payable and accrued expenses.

Akcea is also entitled to receive royalty payments subject to certain terms set forth in the Tegsedi-Waylivra Agreement related to sales of Waylivra and Tegsedi. In accordance with the guidance for an asset acquisition, the Company records royalty payments when they become payable to Akcea and increase the cost basis for the Waylivra and Tegsedi intangible assets. For the three months ended March 31, 2023 and 2022, royalty payments of $2.0 million and $0.4 million, respectively, were recorded for Tegsedi. As of March 31, 2023, a royalty payable of $2.0 million for Tegsedi was recorded on the balance sheet within accounts payable and accrued expenses. No royalties for Waylivra have been triggered to date.

For the three months ended March 31, 2023 and 2022, the Company recognized amortization expense of $39.4 million and $23.5 million, respectively, related to the Emflaza rights, Upstaza, Waylivra, and Tegsedi intangible assets. The estimated future amortization of the Emflaza rights, Upstaza, Waylivra, and Tegsedi intangible assets is expected to be as follows:


	As of March 31, 2023
2023	$	118,266
2024		33,462
2025		9,702
2026		9,702
2027 and thereafter		61,507
Total	$	232,639

The weighted average remaining amortization period of the definite-lived intangibles as of March 31, 2023 is 5.0 years.

Indefinite-lived intangibles

Indefinite lived intangible assets consisted of the following at March 31, 2023 and December 31, 2022:


		Ending Balance at				Reclass from				Foreign		Ending Balance at
Indefinite lived		December 31,				Indefinite Lived to				currency		March 31,
intangibles assets		2022		Additions		Definite Lived		Impairment		translation		2023
Upstaza	$	235,766	$	—	$	—	$	—	$	—	$	235,766
PTC-FA		112,500		—		—		—		—		112,500
PTC-AS		105,300		—		—		—		—		105,300
Total indefinite lived intangibles	$	453,566	$	—	$	—	$	—	$	—	$	453,566

Total intangible assets, net											$	686,205

In connection with the acquisition of the Company’s gene therapy platform from Agilis, the Company acquired rights to Upstaza, for the treatment of AADC deficiency. AADC deficiency is a rare CNS disorder arising from reductions in the enzyme AADC that result from mutations in the dopa decarboxylase gene. The gene therapy platform also includes PTC-FA, an asset targeting Friedreich ataxia, a rare and life-shortening neurodegenerative disease caused by a single defect in the FXN gene which causes reduced production of the frataxin protein. Additionally, the gene therapy platform includes two other programs targeting CNS disorders, including PTC-AS for Angelman syndrome, a rare, genetic, neurological

disorder characterized by severe developmental delays. As of March 31, 2023, there have been no changes to the indefinite lived intangible assets balance since the year ended December 31, 2022.

Goodwill

As a result of the Agilis Merger on August 23, 2018, the Company recorded $82.3 million of goodwill. As of March 31, 2023, there have been no changes to the balance of goodwill since the date of the Agilis Merger. Accordingly, the goodwill balance as of March 31, 2023 is $82.3 million.