Goodwill and Other Intangible Assets

12 Months Ended

Dec. 31, 2015

Goodwill and Other Intangible Assets [Abstract]

Goodwill and Intangible Assets [Text Block]

Goodwill and Other Intangible Assets

The following table summarizes the changes in the carrying amount of goodwill (in thousands):



	Total
Balance as of December 31, 2014	$	25,209.3
Goodwill impairment	(18,196.0		)
Balance as of December 31, 2015	$	7,013.3

Goodwill impairment of $18.2 million is based on the Company's annual review for goodwill impairment as of December 31, 2015, and related to the Company's Research and Development reporting unit. The impairment is directly attributable to the Company's decision to discontinue its CLBS20 Phase 3 study. The Company evaluated whether goodwill was impaired in the Research and Development reporting unit as of June 30, 2015 in connection with its decision to no longer pursue further development of CLBS10, and concluded there was no goodwill impairment. The remaining goodwill is solely related to the PCT reporting unit.

The Company's intangible assets and related accumulated amortization as of December 31, 2015 and December 31, 2014 consisted of the following (in thousands):



		December 31, 2015							December 31, 2014
	Useful Life	Gross		Accumulated Amortization			Net		Gross		Accumulated Amortization			Net
Customer list	10 years	$	1,000.0	$	(495.1	)	$	504.9	$	1,000.0	$	(395.1	)	$	604.9
Manufacturing technology	10 years	3,900.0		(1,930.9		)	1,969.1		3,900.0		(1,540.9		)	2,359.1
Tradename	10 years	800.0		(396.1		)	403.9		800.0		(316.1		)	483.9
In process R&D	Indefinite	—		—			—		43,690.0		—			43,690.0
Patent rights	19 years	—		—			—		669.0		(246.5		)	422.5
Total Intangible Assets		$	5,700.0	$	(2,822.1	)	$	2,877.9	$	50,059.0	$	(2,498.6	)	$	47,560.4

The Company’s IPR&D programs were acquired in the Amorcyte Acquisition (CD34 technology) and CSC Acquisition (tumor cell/dendritic cell technology).

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CD34 Technology: The Company determined as of June 30, 2015, based on a thorough analysis of the available data from the PreSERVE-AMI Phase 2 clinical study, an updated commercial assessment, and consultation with the Company’s scientific advisory board and the Science and Technology Committee of the Board of Directors, that it will not pursue further development of CLBS10 for the acute myocardial infarction indication upon completion of the ongoing PreSERVE-AMI Phase 2 clinical study. However, it intends to explore other potential and more commercially viable indications of chronic heart failure and/or critical limb ischemia for its CD34 cell technology platform. These other indications are early stage opportunities, and would require external funding and/or partnerships to proceed to the next step in clinical development. As a result, and given the early stage and funding constraints of these other potential opportunities, the Company determined that IPR&D valued at $9.4 million was fully impaired as of June 30, 2015.

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Tumor Cell/Dendritic Cell Technology: In May 2014, in connection with the CSC Acquisition, the Company acquired CLBS20, a Phase 3 clinical study as a monotherapy for treatment of recurrent Stage III or Stage IV metastatic melanoma.The Company determined as of December 31, 2015, that the treatment paradigm in metastatic melanoma was transformed during the course of 2015 by the accelerating adoption of multiple immune checkpoint inhibitors used as monotherapy and in combination treatments. These new drugs have significantly improved outcomes in metastatic melanoma and therefore have altered the opportunity for a monotherapy such as CLBS20 in a landscape that is quickly converting to combination therapies, and as a result, the Company discontinued the ongoing CLBS20 Phase 3 clinical study. As a result, given the changing competitive landscape and funding constraints of advancing this program, and a thorough evaluation of these factors by the Company's management in the fourth quarter of 2015, the Company determined that IPR&D valued at $34.3 million was fully impaired as of December 31, 2015.

Total intangible amortization expense was classified in the operating expense categories for the periods included below as follows (in thousands):



	Year Ended December 31,
	2015		2014		2013
Cost of revenue	$	309.1	$	316.8	$	390.0
Research and development	116.1		108.4		35.2
Selling, general and administrative	180.0		180.0		180.0
Total	$	605.2	$	605.2	$	605.2

Estimated intangible amortization expense on an annual basis for the succeeding five years is as follow (in thousands):



2016	$	570.0
2017	570.0
2018	570.0
2019	570.0
2020	570.0
Thereafter	27.9
	$	2,877.9

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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