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GOODWILL AND INTANGIBLE ASSETS | 12 Months Ended
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Dec. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract] |
GOODWILL AND INTANGIBLE ASSETS | GOODWILL AND INTANGIBLE ASSETS Goodwill The Company tests goodwill for impairment by either performing a qualitative evaluation or a quantitative test. 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 two reporting units, a legacy surgical implants unit and a bracing reporting unit established with the acquisition of MD Ortho, and perform a quantitative test on each. The assumptions used in evaluating goodwill for impairment are subject to change and are tracked against historical results by management. The Company elected to perform a qualitative analysis for its reporting units as of October 1, 2022. The Company determined, after performing the qualitative analysis that there was no evidence that it is more likely than not that the fair value of its reporting units were less than the carrying amount, therefore, it was not necessary to perform a quantitative impairment test. Changes in the carrying amount of goodwill were as follows:
|  | Total
Goodwill at January 1, 2021 |  | $ | 70,511 |
Foreign currency translation impact |  | 1,838 |
Goodwill at January 1, 2022 |  | $ | 72,349 |
MD Ortho acquisition |  | 5,450 |
Pega acquisition |  | 16,528 |
Foreign currency translation impact |  | (7,506) |
Goodwill at December 31, 2022 |  | $ | 86,821 |
Intangible Assets As of December 31, 2022, the balances of total intangible assets were as follows:
| Weighted-Average Amortization Period |  | Gross Intangible Assets |  | Accumulated Amortization |  | Impairment |  | Net Intangible Assets
Patents | 12.2 years |  | $ | 46,005 |  |  | $ | (7,953) |  |  | $ | — |  |  | $ | 38,052 |
Intellectual Property | 9.8 years |  | 5,859 |  |  | (1,382) |  |  | — |  |  | 4,477 |
Customer Relationships & Other | 13.4 years |  | 17,262 |  |  | (1,805) |  |  | — |  |  | 15,457 |
License agreements | 4.5 years |  | 10,697 |  |  | (3,703) |  |  | — |  |  | 6,994 |
Total amortizable assets |  |  | $ | 79,823 |  |  | $ | (14,843) |  |  | $ | — |  |  | $ | 64,980 |
Other intangible assets |  |  |  |  |  |  |  |  |
Trademark assets | Indefinite |  | $ | 18,530 |  |  | $ | — |  |  | $ | 3,609 |  |  | $ | 14,921 |
As of December 31, 2021, the balances of amortizable intangible assets were as follows:
| Weighted-Average Amortization Period |  | Gross Intangible Assets |  | Accumulated Amortization |  | Net Intangible Assets
Patents | 13.7 years |  | $ | 44,493 |  |  | $ | (5,664) |  |  | $ | 38,829 |
Intellectual Property | 10.1 years |  | 9,847 |  |  | (1,408) |  |  | 8,439 |
License agreements | 5.5 years |  | 10,674 |  |  | (2,448) |  |  | 8,226 |
Total amortizable assets |  |  | $ | 65,014 |  |  | $ | (9,520) |  |  | 55,494 |
Amortization expense was $5,977, $4,531 and $3,246 for the years ended December 31, 2022, 2021 and 2020, respectively. Future amortization expenses are expected as follows:
Year Ending December 31: |
2023 | $ | 6,370 |
2024 | 6,247 |
2025 | 6,058 |
2026 | 6,040 |
2027 | 5,686 |
Thereafter | 34,579 |
| $ | 64,980 |
Licenses are tied to product launches and do not begin amortizing until the product is launched to the market. Anticipated market launch is in 2022 through 2024 for products for which we previously obtained licensing. On October 20, 2021, we purchased certain intellectual property assets from Devise Ortho, Inc. related to its Drive Rail external fixation system. We recorded $840 which will be amortized over the life of the patents, or approximately 16 years. In addition to the intellectual property, the Company purchased $108 of inventory from Devise Ortho, Inc. The total consideration of $948 was paid using $650 in cash and 4,599 shares of the Company's common stock, representing approximately $298 (based on the closing share price of $64.83 on October 20, 2021). On September 3, 2021, we entered into a five-year license agreement, resulting in exclusive distribution rights of the 7D Surgical FLASH TM Navigation platform for pediatric applications. We paid $750 which will be amortized over the initial three years of the agreement. On July 20, 2021, we entered into an amended license agreement, resulting in a five-year extension of our exclusive distribution rights of the FIREFLY Technology in children's hospitals across the United States. We paid $4,300 for the amended agreement and the amount will be amortized over the life of the agreement. On March 19, 2021, we recorded a license agreement in the amount of $2,858 in settlement of an alleged patent infringement suit related to scoliosis derotation. Amortization is recorded based on the cases completed in the given period. On June 10, 2020, we purchased certain intellectual property assets from Band-Lok, LLC, a North Carolina limited liability company ("Band-Lok"), related to its Tether Clamp and Implantation System ("Tether Clamp System") for $3,394 in total consideration. We use the Tether Clamp System in connection with our Bandloc 5.5/6.0 System. We were previously the sole licensee of the purchased assets under a license agreement with Band-Lok. Trademarks are recorded as indefinite-lived intangible assets in the amounts of $14,921 and $14,268 as of December 31, 2022 and 2021, respectively. Concurrently with our acquisition of each company, we acquired the trademark of Telos on March 9, 2020 valued at $210 and the trademark of ApiFix on April 1, 2020 valued at $8,640. In 2022 we acquired trademarks associated with MD Ortho and Pega Medical for approximately $2,410 and $3,040, respectively. Trademarks are recorded in Other Intangible assets on the Consolidated Balance Sheets. During 2022, management determined that a triggering event occurred, indicating that it was more likely than not the fair value of the trademark assets is less than the carrying value. As such, the company completed a quantitative analysis whereby we determined the fair value of the trademark asset associated with our ApiFix acquisition was below the carrying value. We recorded a $3,609 impairment charge for the year ended December 31, 2022 to reduce the carrying amount of the intangible asset to its estimated fair value.

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