The qualitative evaluation is an assessment of factors including reporting unit specific operating results as well as industry, market and general economic conditions, to determine whether it is more likely than not that the fair values of a reporting unit is less than its carrying amount, including goodwill. The Company may elect to bypass the qualitative assessment for its three reporting units and perform a quantitative test. The assumptions used in evaluating goodwill for impairment are subject to change and are tracked against historical results by management.

The quantitative test estimates the fair value of its three reporting units using a discounted cash flow model, which incorporates significant estimates and assumptions made by management which, by their nature, are characterized by uncertainty. Inputs used to fair value the Company's reporting units are considered inputs of the fair value hierarchy. For Level 3 measurements, significant increases or decreases in long-term growth rates or discount rates in isolation or in combination could result in a significantly lower or higher fair value measurement. The key assumptions impacting the valuation included the following:

•The reporting unit's financial projections, which are based on management's assessment of regional and macroeconomic variables, industry trends and market opportunities, and the Company's strategic objectives and future growth plans.

•The projected terminal value for the reporting unit, which represents the present value of projected cash flows beyond the last period in the discounted cash flow analysis. The terminal value reflects the Company's assumptions related to long-term growth rates and profitability, which are based on several factors, including local and macroeconomic variables, market opportunities, and future growth plans.

•The discount rate used to measure the present value of the projected future cash flows is set using a weighted-average cost of capital method that considers market and industry data as well as the Company's specific risk factors that are

likely to be considered by a market participant. The weighted-average cost of capital is the Company's estimate of the overall after-tax rate of return required by equity and debt holders of a business enterprise.

The Company elected to perform a qualitative analysis for its three reporting units as of July 31, 2020. The Company determined, after performing qualitative analysis, that there was no evidence that it is more likely than not that the fair value of any identified reporting unit was less that the carrying amounts, therefore, it was not necessary to perform a quantitative impairment test.


	Codman Specialty Surgical		Orthopedics and Tissue Technologies		Total
	(In thousands)



Goodwill at January 1, 2019	$	625,760	$	300,715	$	926,475
Arkis Acquisition	27,600		—		27,600
Foreign currency translation	140		65		205
Goodwill at December 31, 2019	$	653,500	$	300,780	$	954,280
Foreign currency translation	18,475		7,158		25,633
Transfer to assets held for sale (See Note 3. Assets Held for Sale)	$	—	$	(47,546)	$	(47,546)
Goodwill at December 31, 2020	$	671,975	$	260,392	$	932,367


	December 31, 2020
	Weighted Average Life	Cost		Accumulated Amortization		Net

	(Dollars in Thousands)
Completed technology	19 years	$	896,478	$	(248,088)	$	648,390
Customer relationships	12 years	213,270		(132,838)		80,432
Trademarks/brand names	28 years	104,209		(31,767)		72,442
Codman trade name	Indefinite	170,226		—		170,226
Supplier relationships	27 years	30,211		(15,203)		15,008
All other (1)	4 years	9,995		(7,057)		2,938
		$	1,424,389	$	(434,953)	$	989,436


	December 31, 2019
	Weighted Average Life	Cost		Accumulated Amortization		Net

	(Dollars in Thousands)
Completed technology	19 years	$	880,623	$	(213,702)	$	666,921
Customer relationships	12 years	222,575		(119,393)		103,182
Trademarks/brand names	28 years	103,873		(28,514)		75,359
Codman trade name	Indefinite	163,126		—		163,126
Supplier relationships	27 years	34,721		(17,947)		16,774
All other (1)	4 years	10,869		(4,640)		6,229
		$	1,415,787	$	(384,196)	$	1,031,591

(1)At December 31, 2020 and 2019, all other included IPR&D of $1.0 million, which was indefinite-lived. At December 31, 2020, this IPR&D asset was presented separately as "assets held for sale" in conjunction with the sale of the Extremity Orthopedics business which is expected to be sold within twelve months. See Note 3, Assets and Liabilities Held for Sale, for details.

At December 31, 2020, $13.3 million of Intangible assets, net were presented separately as "assets held for sale" in conjunction with the sale of the Extremity Orthopedics business. See Note 3, Assets and Liabilities Held for Sale.

The Company tests intangible assets with indefinite lives for impairment annually in the third quarter in accordance with ASC Topic 350. The Company elected to bypass the qualitative evaluation for its Codman tradename intangible asset and perform quantitative test during the third quarter of 2020. In performing the test, the Company utilized a range of projected sales growth rates, a royalty rate of 5.0%, a tax rate of 24.0% and a discount rate of 11.5%. The assumptions used in evaluating the Codman tradename for impairment are subject to change and are tracked against historical results by management. Based on the results of the quantitative test, the Company recorded no impairment to the Codman tradename intangible asset.

Product rights and other definite-lived intangible assets are tested periodically for impairment in accordance with ASC Topic 360 when events or changes in circumstances indicate that an asset's carrying value may not be recoverable. The impairment testing involves comparing the carrying amount of the asset or asset group to the forecasted undiscounted future cash flows. In the event the carrying value of the asset exceeds the undiscounted future cash flows, the carrying value is considered not recoverable and impairment exists. An impairment loss is measured as the excess of the asset's carrying value over its fair value, calculated using discounted future cash flows. The computed impairment loss is recognized in the period that the impairment occurs.

During the second quarter of 2019, a contract manufacturing customer of the private label product line received a notification from the FDA ordering them to remove their product from the market. The Company recorded an impairment charge of $5.8 million in intangible asset amortization in the consolidated statement of operations related to the customer relationship intangible asset acquired from TEI Biosciences, Inc. and TEI Medical Inc. (collectively "TEI") due to revised future projections based on the contract termination.

Amortization expense (including amounts reported in cost of product revenues) for the years ended December 31, 2020, 2019 and 2018 was $74.5 million, $72.8 million and $71.6 million, respectively. Annual amortization expense is expected to approximate $63.8 million in 2021, $61.4 million in 2022, $60.7 million in 2023, $60.2 million in 2024, $60.2 million in 2025 and $512.3 million thereafter. Amortization of product technology based intangible assets totaled $46.7 million, $45.8 million and $50.4 million for the years ended December 31, 2020, 2019 and 2018, respectively, and is presented by the Company within cost of goods sold.