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Business Combinations (Tables)

9 Months Ended

Sep. 30, 2021

Business Combination and Asset Acquisition [Abstract]

Preliminary Allocation of the Purchase Price to the Assets Acquired and the Liabilities Assumed by the Company

The following table summarizes the preliminary purchase price for the FDS Amplicare acquisition:

			FDS Amplicare
			(In thousands)
Base purchase price			$	177,000
Add: Estimated closing cash			859
Add: Estimated net working capital adjustment			1,333
Less: Assumed indebtedness			(647)
Total purchase price transferred			$	178,545

The following table represents the preliminary allocation of the purchase price to the assets acquired and the liabilities assumed by the Company as part of the acquisition included in the Company’s Condensed Consolidated Balance Sheets, and is reconciled to the purchase price transferred:

			FDS Amplicare (Preliminary)
			(In thousands)
Cash and cash equivalents			$	465
Accounts receivable and unbilled receivables			4,235
Prepaid expenses			506
Other current assets			45
Total current assets			5,251
Property and equipment			444
Operating lease right-of-use assets			2,252
Goodwill			118,846
Intangible assets			69,600
Other long-term assets			51
Total assets			196,444
Accounts payable			950
Accrued compensation			1,312
Accrued liabilities			1,396
Deferred revenues			1,916
Long-term deferred tax liabilities			11,275
Long-term operating lease liabilities			920
Other long-term liabilities			130
Total liabilities			17,899
Total purchase price			$	178,545
Total purchase price, net of cash acquired			$	178,080

The following table represents the allocation of the purchase price to the assets acquired and the liabilities assumed by the Company as part of the acquisition included in the Company’s Condensed Consolidated Balance Sheets, and is reconciled to the purchase price transferred:

			340B Link Business
			(In thousands)
Accounts receivable and unbilled receivables			$	8,197
Prepaid expenses			232
Other current assets (1)			23,040
Total current assets			31,469
Property and equipment			531
Operating lease right-of-use assets			3,138
Goodwill (1)			160,268
Intangible assets			62,800
Total assets			258,206
Accounts payable			568
Accrued liabilities (1)			23,715
Long-term deferred tax liabilities (1)			6,334
Long-term operating lease liabilities			2,589
Total liabilities			33,206
Total purchase price			$	225,000

_________________________________________________

(1)    During the third quarter of 2021, the Company recorded measurement period adjustments of $0.9 million to goodwill, consisting of an increase in other current assets, a decrease in accrued liabilities, and a decrease in long-term deferred tax liabilities of $0.3 million, $0.1 million, and $0.5 million, respectively.

Summary of Identifiable Intangible Assets Acquired

The identifiable intangible assets acquired and their estimated useful lives for amortization are as follows:

			FDS Amplicare
			Fair value						Useful life (years)
			(In thousands, except for years)
Customer relationships			$	59,500					23
Acquired technology			7,700						5 - 7
Trade names			2,400						5
Total purchased intangible assets			$	69,600

The identifiable intangible assets acquired and their estimated useful lives for amortization are as follows:

			340B Link Business
			Fair value						Useful life (years)
			(In thousands, except for years)
Customer relationships			$	53,000					21
Acquired technology			9,000						5
Trade names			200						1
Non-compete agreements			600						3
Total purchased intangible assets			$	62,800

Pro Forma Financial Information

The following table presents certain unaudited pro forma consolidated financial information for the three and nine months ended September 30, 2021 and 2020 as if the FDS Amplicare acquisition had been completed on January 1, 2020 and the 340B Link Business acquisition had been completed on January 1, 2019. The unaudited pro forma financial information is presented for informational purposes only, and is not indicative of what would have occurred had the FDS Amplicare acquisition and the 340B Link Business acquisition taken place on January 1, 2020 and January 1, 2019, respectively. The unaudited pro forma financial information combines the historical results of the acquisitions with the Company’s consolidated historical results and includes certain adjustments including, but not limited to, amortization and depreciation of intangible assets and property and equipment acquired; imputed interest, interest expense, and amortization of debt issuance costs related to acquisitions, as applicable; and certain acquisition-related costs incurred.

			Three Months Ended September 30,												Nine Months Ended September 30,
			2021						2020						2021						2020
			(In thousands)
Pro forma revenues			$	302,114					$	230,099					$	840,896					$	689,208
Pro forma net income			$	32,050					$	10,350					$	65,194					$	8,476

X

- Definition

Tabular disclosure of pro forma results of operations for a material business acquisition or series of individually immaterial business acquisitions that are material in the aggregate.

+ References

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-Name Accounting Standards Codification
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- Definition

Tabular disclosure of characteristics and cost, by total and major class, of indefinite-lived intangible assets acquired as part of a business combination. Indefinite-lived intangible assets are assets that have no physical form, but have expected future economic benefit. The future benefit is not expected to diminish over a stated period of time. Acquired indefinite-lived intangible assets are disclosed by major class (assets that can be grouped together because they are similar, either by their nature or by their use in operations of the entity) and in total.

+ References

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Tabular disclosure of the amounts recognized as of the acquisition date for each major class of assets acquired and liabilities assumed. May include but not limited to the following: (a) acquired receivables; (b) contingencies recognized at the acquisition date; and (c) the fair value of noncontrolling interests in the acquiree.

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