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DISCONTINUED OPERATIONS
 3 Months Ended
Mar. 31, 2016
Discontinued Operations and Disposal Groups [Abstract]  
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS

On September 8, 2015, we entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with Edge BioSystems, Inc. (“Edge Bio”), pursuant to which we sold our manufacturing, marketing and selling of high quality polymer and silica based beads and resin and chromatography columns business (collectively, the “Columns Business”). The Columns Business was part of our former segment, Genetic Assays and Platforms. Pursuant to the Asset Purchase Agreement, Edge Bio acquired substantially all of the assets used solely in connection with the Columns Business and assumed certain liabilities of the Columns Business for a total cash purchase price of approximately $2.1 million (the “Asset Sale”), which was paid on September 8, 2015 upon the closing of the Asset Sale. During the year ended December 31, 2015, we recorded a gain on the sale of the Columns Business of $1.5 million.

On November 25, 2015, we entered into an Asset Purchase Agreement (the “Purchase Agreement”) with ADSTEC Corporation (“ADSTEC”) and ADS Biotec Inc., a wholly-owned subsidiary of ADSTEC (“Buyer”), pursuant to which we sold (1) to ADSTEC our facilities located in Glasgow, Scotland and on Irvington Road in Omaha, Nebraska (together, the “Facilities”) and all of our stock, inventory and raw materials located at the Facilities (collectively, the “Inventory”), and (2) to Buyer (a) all of the remaining assets relating to our Genetic Assays and Platforms business segment (the “Business”), other than the Inventory (the “Purchased Assets”), and (b) all of the ordinary shares of Transgenomic Limited, a wholly-owned subsidiary of ours (the “Shares”).

Pursuant to the Purchase Agreement, ADSTEC and Buyer acquired the Facilities, the Inventory, the Purchased Assets and the Shares for an aggregate purchase price of approximately $300,000, and Buyer assumed our financial and human resources commitments related to the Business (the “Transaction”). During the year ended December 31, 2015, we recorded a loss on the Transaction of $1.7 million.

Together, the Asset Sale and the Transaction represent the divestiture of our Genetic Assays and Platforms business, resulting in a strategic shift that will have a major effect on our operations and financial results. Therefore, the divested operations of our Genetic Assays and Platforms business meet the criteria to be reported as discontinued operations.
During the fourth quarter of 2015, our Board of Directors took actions to begin the process of divesting our Patient Testing business in New Haven, Connecticut. In March of 2016, we announced that we had suspended testing services in our Patient Testing laboratory as we review and evaluate various strategic alternatives for that business. As a result of these actions, as of December 31, 2015, our Patient Testing business met the criteria to be reported as discontinued operations. We anticipate that we will complete the divestiture of the Patient Testing business during 2016.
The related assets, liabilities, results of operations and cash flows for both the Genetic Assays and Platforms business and Patient Testing business are classified as assets held for sale, liabilities held for sale and discontinued operations for all periods presented.












Results of the discontinued operations consisted of the following:
 
Three months ended March 31,
(in thousands)
2016
 
2015
Net sales
$
1,103

 
$
5,763

Cost of goods sold
1,183

 
3,074

Gross profit
(80
)
 
2,689

Selling, general and administrative expense
1,025

 
3,250

Research and development expense
68

 
116

Loss from discontinued operations before income taxes
(1,173
)
 
(677
)
Income tax expense
—

 
46

Loss from discontinued operations
$
(1,173
)
 
$
(723
)


Assets and liabilities of the discontinued operations are classified as assets held for sale and liabilities held for sale in the condensed consolidated balance sheets and consisted of the following:
 
Dollars in Thousands
 
March 31,
2016
 
December 31,
2015
ASSETS
 
 
 
Accounts receivable, net
$
1,150

 
$
1,905

Other current assets
32

 
82

Total Assets
$
1,182

 
$
1,987

 
 
 
 
LIABILITIES
 
 
 
Accrued compensation
$
20

 
$
264

Total Liabilities
$
20

 
$
264

 
 
 
 

The following is a summary of activity for the allowance for doubtful accounts from discontinued operations during the three months ended March 31, 2016 and 2015. The allowance for doubtful accounts from discontinued operations are included in the assets held for sale in the condensed consolidated balance sheets.
 
Dollars in Thousands
 
Beginning
Balance
 
Additions
 
Deductions
 
Ending
Balance
Three Months Ended March 31, 2016
$
14,664

 
$
—

 
$
(122
)
 
$
14,542

Three Months Ended March 31, 2015
$
7,927

 
$
1,532

 
$
(286
)
 
$
9,173