Intangible Assets, net

9 Months Ended

Dec. 31, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

A reconciliation of the activity affecting intangible assets, net is as follows:


(In thousands)	Indefinite- Lived Trademarks		Finite-Lived Trademarks and Customer Relationships		Totals
Gross Carrying Amounts
Balance — March 31, 2022	$	2,476,559	$	436,174	$	2,912,733




Effects of foreign currency exchange rates	(7,646)		(1,993)		(9,639)
Balance — December 31, 2022	2,468,913		434,181		2,903,094

Accumulated Amortization
Balance — March 31, 2022	—		216,098		216,098

Additions	—		16,865		16,865

Effects of foreign currency exchange rates	—		(197)		(197)
Balance — December 31, 2022	—		232,766		232,766

Intangible assets, net - December 31, 2022	$	2,468,913	$	201,415	$	2,670,328

On July 1, 2021, we completed the acquisition of certain assets from Akorn (see Note 2), and on December 15, 2021, our Australian subsidiary acquired the rights to the Zaditen brand in certain territories from Novartis Pharma AG. In connection with these acquisitions, we allocated $225.4 million to intangible assets for Akorn and $18.1 million for Zaditen.

Amortization expense was $5.6 million and $16.9 million for the three and nine months ended December 31, 2022, respectively, and $5.4 million and $15.6 million for the three and nine months ended December 31, 2021, respectively.

Finite-lived intangible assets are expected to be amortized over their estimated useful life, which ranges from a period of 10 to 30 years, and the estimated amortization expense for each of the five succeeding years and the periods thereafter is as follows (in thousands):


(In thousands)
Year Ending March 31,	Amount
2023 (remaining three months ended March 31, 2023)	$	5,619
2024	22,434
2025	20,382
2026	18,134
2027	16,493
Thereafter	118,353
	$	201,415

Under accounting guidelines, indefinite-lived assets are not amortized, but must be tested for impairment annually, or more frequently if an event occurs or circumstances change that would more likely than not reduce the fair value of the asset below the carrying amount. The date of our annual impairment review was February 28, 2022, and we recorded impairment charges to intangible assets of $0.7 million in our March 31, 2022 financial statements. Additionally, at each reporting period, an evaluation must be made to determine whether events and circumstances continue to support an indefinite useful life. Intangible assets with finite lives are amortized over their respective estimated useful lives and are also tested for impairment whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable and exceeds its fair value.

We utilize the excess earnings method to estimate the fair value of our individual indefinite-lived intangible assets. The assumptions subject to significant uncertainties include the discount rate utilized in the analyses, as well as future sales, gross margins, and advertising and marketing expenses. The discount rate assumption may be influenced by such factors as changes in interest rates and rates of inflation, which can have an impact on the determination of fair value. For example, the significant increase in interest rates over the last fiscal year, if sustained at year-end, will significantly impact the discount rate we use in our year-end analysis, impacting the final analysis of many of our brands. Additionally, should the related fair values of intangible assets be adversely affected as a result of declining sales or margins caused by competition, changing consumer needs or preferences, technological advances, changes in advertising and marketing expenses, or the potential impacts of COVID-19, supply chain constraints, labor shortages, or inflation, we may be required to record impairment charges in the future.

As of December 31, 2022, no events have occurred that would indicate potential impairment of intangible assets.