Balance Sheet Details

Accounts Receivable

Accounts receivable consist of the following (in thousands):



	December 31,
	2015			2014
Accounts receivable	$	39,380		$	41,233
Less allowance for doubtful accounts	(1,061		)	(793		)
Accounts receivables, net	$	38,319		$	40,440

Inventories

Inventories consist of the following (in thousands):



	December 31,
	2015			2014
Raw materials	$	7,237		$	5,020
Work-in-process	1,908			1,032
Finished goods	55,393			57,020
	64,538			63,072
Less reserve for excess and obsolete finished goods	(19,630		)	(21,325		)
Inventories, net	$	44,908		$	41,747

Property and Equipment

Property and equipment consist of the following (in thousands except for useful lives):



	Useful lives (in years)	December 31,
	Useful lives (in years)	2015			2014
Surgical instruments	4	$	65,723		$	62,872
Machinery and equipment	7	15,520			15,382
Computer equipment	3	3,984			3,180
Office furniture and equipment	5	3,746			3,789
Leasehold improvements	various	3,856			3,841
Building	39	65			65
Land	n/a	9			9
Construction in progress	n/a	354			1,320
		93,257			90,458
Less accumulated depreciation and amortization		(71,312		)	(64,418		)
Property and equipment, net		$	21,945		$	26,040

Total depreciation expense was $13.0 million, $12.2 million and $14.6 million for the years ended December 31, 2015, 2014 and 2013, respectively. At December 31, 2015, assets recorded under capital leases of $2.6 million were included in the machinery and equipment balance and $0.1 million are included in the construction in progress balance. At December 31, 2014, assets recorded under capital leases of $3.2 million were included in the machinery and equipment balance and $0.6 million are included in the construction in progress balance. Amortization of assets under capital leases is included in depreciation expense.

Intangible Assets

Intangible assets consist of the following (in thousands except for useful lives):



	Remaining Avg. Useful lives (in years)	December 31,
	Remaining Avg. Useful lives (in years)	2015			2014
Developed product technology	1	$	21,633		$	22,526
Distribution rights	4	2,100			2,095
Intellectual property	—	1,004			1,004
License agreements	1	16,714			16,716
Core technology	4	4,086			4,554
Trademarks and trade names	2	3,245			3,559
Customer-related	9	19,169			20,493
Distribution network	5	4,027			4,027
Physician education programs	—	2,513			2,802
Supply agreement	—	225			225
		74,716			78,001
Less accumulated amortization		(53,100		)	(47,742		)
Intangible assets, net		$	21,616		$	30,259

Total expense related to amortization of intangible assets was $6.1 million, $6.2 million and $11.6 million for the years ended December 31, 2015, 2014 and 2013, respectively.

In 2015, the Company determined that the physician education intangible asset acquired in the Scient’x acquisition was impaired. As a result, the Company recorded a $0.9 million expense, which is included in goodwill and intangible impairment in the year ended December 31, 2015. Prior to the impairment, amortization of the physician eduction intangible asset had been recorded in amortization of acquired intangible assets within operating expenses.

On June 19, 2015, the Company entered into an exclusive distribution agreement with a third party to market a biologic product that would replace its existing NEXoss Synthetic Bone Graft. The Company expensed $0.3 million as an impairment charge in cost of goods sold for the write-off of an intangible asset related to this product. Additionally, due to a revised marketing strategy for the Company's Epicage interbody fusion device, the Company evaluated the related intangible asset for impairment in June 2015. As a result of this impairment analysis the Company expensed $0.9 million as an impairment charge in cost of goods sold for the write-off of an intangible asset related to this product.

During 2013, the Company decided to discontinue marketing and selling of an adult stem cell product sold under the Company's private label name of PureGen and two additional products. The Company expensed $1.3 million as impairment charges in cost of goods sold in the year ended December 31, 2013 for the write-off of intangible assets related to these products.

The future expected amortization expense related to intangible assets as of December 31, 2015 is as follows (in thousands):




Year Ending December 31,
2016	$	4,001
2017	3,995
2018	2,844
2019	2,410
2020	1,811
Thereafter	6,555

Total	$	21,616

Goodwill

The changes in the carrying amount of goodwill from December 31, 2014 through December 31, 2015 were as follows (in thousands):




	2015			2014
Balance at January 1	$	171,333		$	183,004
Impairment charge	(164,266		)	—
Effect of foreign exchange rate on goodwill	(7,067		)	(11,671		)
Balance at December 31	$	—		$	171,333

Accrued Expenses

Accrued expenses consist of the following (in thousands):



	December 31,
	2015		2014
Commissions and sales milestones	$	5,920	$	6,259
Payroll and payroll related	5,577		8,291
Litigation settlements	4,400		7,393
Accrued professional fees	2,203		2,342
Royalties	1,578		2,129
Restructuring and severance accruals	1,358		849
Accrued taxes	1,074		1,344
Accrued interest	999		946
Other	6,682		5,840
Total accrued expenses	$	29,791	$	35,393