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ACQUISITIONS | 12 Months Ended
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Aug. 31, 2025
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract] |
ACQUISITIONS | ACQUISITIONS On June 16, 2023, the Company completed the acquisition of Immunetrics for an estimated consideration of $15.3 million. The Company made the first cash earnout payments in the aggregate amount of $2.5 million to the former equity holders and employees of Immunetrics in March 2024. During fiscal year ended August 31, 2025, the Company determined the second earnout measurement period's fair value to be zero based on earned revenues. During the fiscal year ended August 31, 2025, the Company completed the final payment of $1.6 million related to the holdback liability of Immunetrics. The primary purpose of this acquisition is to be able to capitalize on a tremendous growth opportunity by providing support for quantitative systems pharmacology (“QSP”) in a greater range of therapeutic areas, including oncology. Under the acquisition method of accounting, the total purchase price reflects Immunetrics’ tangible and intangible assets and liabilities based on their estimated fair values at the date of the completion of the acquisition (June 16, 2023). The following table summarizes the allocation of the final purchase price for Immunetrics:
(in thousands) |  |
Base merger consideration |  | $ | 12,000 |
Fair value of earnout |  | 4,100 |
Cash on hand |  | 1,247 |
Adjustment to purchase price for closing indebtedness |  | (122) |
Net working capital adjustment |  | (377) |
D&O tail insurance |  | (7) |
Bonus compensation to Immunetrics staff |  | (1,586) |
Total purchase price |  | 15,255 |
Fair value of identifiable assets acquired: |  |
Cash |  | 1,132 |
Accounts receivable |  | 511 |
Security deposit |  | 12 |
ROU asset |  | 227 |
Deferred tax assets |  | 799 |
Trade names |  | 1,800 |
Customer relationships |  | 3,780 |
Developed Tech |  | 1,080 |
Non-competes |  | 30 |
|  | 9,371 |
Fair value of liabilities assumed: |  |
Lease liability |  | 227 |
Selling shareholders' D&O tail insurance responsibility |  | 7 |
Deferred revenue |  | 60 |
|  | 294 |
Fair value of identifiable assets acquired and liabilities assumed |  | 9,077 |
Goodwill |  | $ | 6,178 |
The total purchase consideration related to Immunetrics acquisition consisted of cash consideration. The excess of purchase consideration over the fair value of the net assets acquired was recorded as goodwill, which is primarily attributed to the developed technologies and other intangibles as customer relationships and trade name. Immunetrics is primarily attributable to the Services segment of the Company. Goodwill acquired as part of Immunetrics acquisition has been assigned to a separate reporting unit and the assets and liabilities of Immunetrics are assigned to the same reporting unit, Immunetrics. This goodwill is not expected to be deductible for income tax purposes. Intangible assets consist of indefinite-lived intangible asset trade names and definite-lived intangibles as customer relationships, developed technologies, and covenants not to compete. We amortize purchased definite-lived intangible assets on a straight-line basis over their respective useful lives. The weighted-average life of the total acquired identifiable definite-lived intangible assets is 7.5 years. The following table presents the details of intangible assets acquired.
(in thousands) |  | Estimated useful life |  | Amount
Indefinite-lived: |  |  |  |
Trade names |  | Indefinite |  | $ | 1,800 |
Definite-lived: |  |  |  |
Customer relationships |  | 9 years |  | 3,780 |
Developed technologies |  | 5 years |  | 1,080 |
Covenants not to compete |  | 2 years |  | 30 |
Total definite-lived intangible assets |  |  |  | 4,890 |
Total intangible assets |  |  |  | $ | 6,690 |
During the third quarter of fiscal year 2025, we recorded $3.9 million of goodwill, intangible, and fixed asset impairment charges attributable to the Immunetrics acquisition. The impairment charges relate to the triggering event. These costs are included in Impairment on our consolidated statement of operations. See Note 2 – Significant Accounting Policies for additional details. On June 11, 2024, the Company entered into a stock purchase agreement, pursuant to which it acquired Pro-ficiency Holdings, Inc. (“Pro-ficiency”) for estimated consideration of $100.2 million. The primary purpose of this acquisition was to bring together two businesses, each with complementary expertise and services that are grounded in science and focused on applying advanced technologies like AI to enhance actionable data analytics. Under the acquisition method of accounting, the total purchase price reflects Pro-ficiency’s tangible and intangible assets and liabilities based on their estimated fair values at the date of the completion of the acquisition (June 11, 2024). The following table summarizes the allocation of the final purchase price for Pro-ficiency:
(in thousands) |  | Estimated fair value as previously reported (a) |  | Measurement Period Adjustments |  | Fair Value as adjusted
Base merger consideration |  | $ | 100,000 |  |  | $ | — |  |  | $ | 100,000 |
Net working capital adjustment |  | (85) |  |  | — |  |  | (85) |
Excess cash adjustment |  | 1,731 |  |  | 227 |  |  | 1,958 |
Adjustment to purchase price for closing indebtedness |  | (1,484) |  |  | — |  |  | (1,484) |
Total purchase price |  | 100,162 |  |  | 227 |  |  | 100,389 |
Fair value of identifiable assets acquired: |  |  |  |  |  |
Cash |  | 2,513 |  |  | — |  |  | 2,513 |
Accounts receivable |  | 2,064 |  |  | — |  |  | 2,064 |
Prepaids and other current assets |  | 1,807 |  |  | — |  |  | 1,807 |
ROU asset |  | 212 |  |  | — |  |  | 212 |
Trade names |  | 8,400 |  |  | — |  |  | 8,400 |
Customer relationships |  | 2,310 |  |  | — |  |  | 2,310 |
Developed technology |  | 16,630 |  |  | — |  |  | 16,630 |
Non-competes |  | 70 |  |  | — |  |  | 70 |
Other non-current assets |  | 17 |  |  | — |  |  | 17 |
|  | 34,023 |  |  | — |  |  | 34,023 |
Fair value of liabilities assumed: |  |  |  |  |  | — |
Accounts payable |  | 935 |  |  | — |  |  | 935 |
Payroll and other current liabilities |  | 2,302 |  |  | — |  |  | 2,302 |
Deferred revenue |  | 1,456 |  |  | — |  |  | 1,456 |
Lease liability |  | 212 |  |  | — |  |  | 212 |
Deferred tax liabilities |  | 4,811 |  |  | (956) |  |  | 3,855 |
Other liabilities |  | 1,124 |  |  | — |  |  | 1,124 |
|  | 10,840 |  |  | (956) |  |  | 9,884 |
Fair value of identifiable assets acquired and liabilities assumed |  | 23,183 |  |  |  |  | 24,139 |
Goodwill |  | $ | 76,979 |  |  |  |  | $ | 76,250 |
(a) As previously reported in the Company's Annual Report on Form 10-K for the year ended August 31, 2024. The Company had two measurement period adjustments due to additional knowledge gained since June 11, 2024. The adjustments include a net working capital & excess cash settlement of $0.2 million and deferred taxes of $1.0 million. The total purchase consideration related to the Pro-ficiency acquisition consisted of cash consideration. The excess of purchase consideration over the fair value of the net assets acquired was recorded as goodwill, which is primarily attributed to the developed technologies and other intangibles such as customer relationships and trade names. Pro-ficiency is structured into two functions: Clinical Operations and Commercialization. Clinical Operations primarily contributes to the software segment and Commercialization primarily contributes to the services segment of the Company. Goodwill acquired as part of the Pro-ficiency acquisition has been assigned to the Clinical Operations and Commercialization reporting units and the assets and liabilities of Pro-ficiency are assigned to the same reporting units. This goodwill is not expected to be deductible for income tax purposes. Intangible assets consist of indefinite-lived intangible asset trade names and definite-lived intangibles as customer relationships, developed technologies, and covenants not to compete. We amortize purchased definite-lived intangible assets on a straight-line basis over their respective useful lives. The weighted-average life of the total acquired identifiable definite-lived intangible assets is 5.3 years. The following table presents the details of intangible assets acquired.
|  | Estimated useful life |  | Amount
Indefinite-lived: |  |  |  |
Trade names |  | Indefinite |  | $ | 8,400 |
Definite-lived: |  |  |  |
Customer relationships |  | 10 years |  | 2,310 |
Developed technologies |  | 5 years |  | 16,630 |
Non-competes |  | 3 years |  | 70 |
Total definite-lived intangible assets |  |  |  | 19,010 |
Total intangible assets |  |  |  | $ | 27,410 |
The estimated future amortization of finite-lived intangible assets for the next five years is as follows:
(in thousands) |  | Amount
Years ending August 31, |
2026 |  | $ | 3,580 |
2027 |  | $ | 3,580 |
2028 |  | $ | 3,580 |
2029 |  | $ | 3,557 |
2030 |  | $ | 3,557 |
During the third quarter of fiscal year 2025, we recorded $72.2 million of goodwill, intangible, and fixed asset impairment charges attributable to the Pro-ficiency acquisition. The impairment charges relate to the triggering event. These costs are included in Impairment on our consolidated statement of operations. See Note 2 – Significant Accounting Policies for additional details. Consolidated Supplemental Pro Forma Information The following unaudited consolidated supplemental pro forma information assumes that the acquisition of Pro-ficiency took place on September 1, 2022 for the fiscal year ended August 31, 2024. These amounts have been calculated after applying the Company’s accounting policies and adjusting the results of Pro-ficiency to reflect the same expenses in the fiscal years ended August 31, 2024 and 2023. The adjustments include costs of acquisition directly attributable to Pro-ficiency of $2.3 million and amortization of intangibles including developed technologies acquired during the acquisition, assuming the fair-value adjustments applied on September 1, 2022, together with consequential tax effects. The adjustments also consist of acquisition costs directly attributable to Immunetrics of $2.9 million consisting of $1.6 million of bonus compensation and $1.3 million of other professional fees, and amortization of intangibles including developed technologies acquired during the merger, assuming the fair-value adjustments applied on September 1, 2022, together with consequential tax effects. The pro forma information in below table includes actual revenues and net loss of $2.3 million and $1.9 million, respectively for Pro-ficiency from the acquisition date of June 11, 2024 to August 31, 2024 and the revenues and net loss of $1.3 million and $0.4 million, respectively, for Immunetrics from the acquisition date of June 16, 2023 to August 31, 2023.
|  | (Pro forma) 2024 * |  | (Pro forma) 2023 |  |
(in thousands) |  | (unaudited) |  | (unaudited) |  |
Revenue |  | $ | 83,243 |  |  | $ | 76,892 |  |  |
Net (loss) income |  | $ | 7,790 |  |  | $ | 4,547 |  |  |
* Balances include actual results from acquisition date of June 16, 2023 through August 31, 2023 for Immunetrics and from acquisition date of June 11, 2024 through August 31, 2024 for Pro-ficiency business.

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- Definition The entire disclosure for business combinations, including leverage buyout transactions (as applicable), and divestitures. This may include a description of a business combination or divestiture (or series of individually immaterial business combinations or divestitures) completed during the period, including background, timing, and assets and liabilities recognized and reclassified or sold. This element does not include fixed asset sales and plant closings. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 205 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/205-20/tableOfContent Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 805 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/805/tableOfContent + Details
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