| Composition of Certain Financial Statement Captions |
Composition of Certain Financial Statement Captions
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For the years ended December 31, |
(In thousands) |
2015 |
|
2014 |
Accounts receivable, net |
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Accounts receivable |
$ |
219,043 |
|
|
$ |
21,875 |
|
Less: allowance for doubtful accounts |
(25,168 |
) |
|
(1,906 |
) |
|
$ |
193,875 |
|
|
$ |
19,969 |
|
Inventories, net |
|
|
|
Consumable supplies |
$ |
22,265 |
|
|
$ |
— |
|
Finished products |
13,404 |
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|
12,116 |
|
Work in-process |
1,215 |
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|
1,011 |
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Raw materials |
3,848 |
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|
4,116 |
|
Less: inventory reserve |
(1,051 |
) |
|
(639 |
) |
|
$ |
39,681 |
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|
$ |
16,604 |
|
Prepaid expenses and other current assets |
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Other receivables |
$ |
11,946 |
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$ |
669 |
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Prepaid supplies |
8,773 |
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|
1,123 |
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Taxes recoverable |
3,076 |
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|
2,417 |
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Prepaid insurance |
2,206 |
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|
968 |
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Other |
903 |
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|
4,212 |
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$ |
26,904 |
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$ |
9,389 |
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Property, plant and equipment, net: |
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Machinery, medical and other equipment |
$ |
89,936 |
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$ |
13,710 |
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Leasehold improvements |
27,949 |
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|
3,592 |
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Furniture and fixtures |
11,403 |
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|
2,148 |
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Automobiles and aircraft |
10,271 |
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— |
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Software |
10,497 |
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|
1,695 |
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Building |
5,965 |
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|
3,171 |
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Land |
2,394 |
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|
2,391 |
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Construction in process |
425 |
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|
225 |
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Less: accumulated depreciation |
(27,042 |
) |
|
(10,521 |
) |
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$ |
131,798 |
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$ |
16,411 |
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Intangible assets, net: |
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Customer relationships |
$ |
449,972 |
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$ |
22,108 |
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Technologies |
151,709 |
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|
52,508 |
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Trade names |
50,416 |
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|
3,483 |
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Covenants not to compete |
8,612 |
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|
8,639 |
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Licenses |
23,432 |
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— |
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Product registrations |
7,512 |
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|
8,763 |
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Other |
5,600 |
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|
1,079 |
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Less: accumulated amortization |
(59,101 |
) |
|
(33,931 |
) |
|
$ |
638,152 |
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$ |
62,649 |
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Accrued expenses: |
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Deferred revenue |
70,246 |
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|
4,185 |
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Employee benefits |
29,751 |
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|
4,127 |
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Taxes payable |
$ |
7,605 |
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$ |
77 |
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Contingent consideration |
22,164 |
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|
27,352 |
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For the years ended December 31, |
Clinical trials |
2,505 |
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|
8,643 |
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Capital leases short-term |
5,373 |
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— |
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Milestone payment |
5,000 |
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— |
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Professional fees |
1,506 |
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|
1,860 |
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Other |
23,749 |
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|
14,668 |
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$ |
167,899 |
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$ |
60,912 |
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Other long-term liabilities: |
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Deferred revenue |
$ |
162,634 |
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$ |
2,526 |
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JP Morgan Chase line of credit |
72,107 |
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— |
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Contingent consideration |
32,258 |
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|
44,215 |
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Capital leases long-term |
9,285 |
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— |
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Mortgages and other debts payable |
2,523 |
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|
2,434 |
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Other |
13,663 |
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|
1,030 |
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$ |
292,470 |
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$ |
50,205 |
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The following table summarizes the fair values assigned to our major intangible asset classes upon each acquisition:
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(In thousands) |
Technologies |
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In-process research and development |
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Customer relationships |
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Product registrations |
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Covenants not to compete |
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Trade names |
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Other |
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Total identified intangible assets |
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Goodwill |
Bio-Reference |
$ |
100,600 |
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|
$ |
— |
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$ |
395,200 |
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$ |
— |
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$ |
— |
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$ |
47,100 |
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$ |
— |
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$ |
542,900 |
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$ |
441,158 |
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CURNA |
— |
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10,000 |
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— |
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— |
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— |
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— |
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|
290 |
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|
10,290 |
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|
4,827 |
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EirGen |
— |
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|
560 |
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|
34,155 |
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— |
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— |
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— |
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3,919 |
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|
38,634 |
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|
83,373 |
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FineTech |
2,700 |
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— |
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|
14,200 |
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|
— |
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|
1,500 |
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|
400 |
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— |
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|
18,800 |
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|
11,623 |
|
OPKO Biologics |
— |
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|
590,200 |
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|
— |
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— |
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— |
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— |
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— |
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590,200 |
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|
139,784 |
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OPKO
Chile
|
— |
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— |
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|
3,945 |
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|
5,829 |
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— |
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|
1,032 |
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— |
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|
10,806 |
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|
5,441 |
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OPKO Diagnostics |
44,400 |
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— |
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— |
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— |
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— |
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— |
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— |
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44,400 |
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|
17,977 |
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OPKO Health Europe |
3,017 |
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|
1,459 |
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|
436 |
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|
2,930 |
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|
187 |
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|
349 |
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— |
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|
8,378 |
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|
8,062 |
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OPKO Lab |
1,370 |
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— |
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3,860 |
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— |
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6,900 |
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|
1,830 |
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|
70 |
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14,030 |
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|
29,629 |
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OPKO Renal |
— |
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|
191,530 |
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— |
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— |
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— |
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— |
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|
210 |
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191,740 |
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|
2,411 |
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Weighted average amortization period |
8-12 years |
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Indefinite |
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6-20 years |
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9 years |
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5 years |
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4-5 years |
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3-10 years |
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Indefinite |
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All of the intangible assets and goodwill acquired relate to our acquisitions of principally OPKO Renal, OPKO Biologics, EirGen and Bio-Reference. We do not anticipate capitalizing the cost of product registration renewals, rather we expect to expense these costs, as incurred. Our goodwill is not tax deductible for income tax purposes in any jurisdiction we operate in.
At December 31, 2015, the changes in value of the intangible assets and goodwill are primarily due to the acquisitions of Bio-Reference and EirGen and foreign currency fluctuations between the Chilean and Mexican pesos, the Euro and the Shekel against the U.S. dollar. At December 31, 2014, the changes in value of the intangible assets and goodwill are primarily due to foreign currency fluctuations between the Chilean and Mexican pesos, the Euro and the Shekel against the U.S. dollar.
The following table reflects the changes in the allowance for doubtful accounts, provision for inventory reserve and tax valuation allowance accounts:
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(In thousands) |
Beginning
balance
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Charged
to
expense
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Written-off |
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Charged
to other
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Ending
balance
|
2015 |
|
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Allowance for doubtful accounts |
$ |
(1,906 |
) |
|
(24,548 |
) |
|
928 |
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|
358 |
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$ |
(25,168 |
) |
Inventory reserve |
$ |
(639 |
) |
|
(926 |
) |
|
435 |
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|
79 |
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$ |
(1,051 |
) |
Tax valuation allowance |
$ |
(131,931 |
) |
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— |
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— |
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|
89,784 |
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$ |
(42,147 |
) |
2014 |
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Allowance for doubtful accounts |
$ |
(1,884 |
) |
|
(646 |
) |
|
321 |
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|
303 |
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$ |
(1,906 |
) |
Inventory reserve |
$ |
(777 |
) |
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(1,082 |
) |
|
1,028 |
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|
192 |
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|
$ |
(639 |
) |
Tax valuation allowance |
$ |
(85,370 |
) |
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— |
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— |
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(46,561 |
) |
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$ |
(131,931 |
) |
The following table summarizes the changes in Goodwill during the year ended December 31, 2015.
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2015 |
|
2014 |
(In thousands) |
Balance at January 1st |
|
Acquisitions |
|
Foreign exchange, other |
|
Balance at December 31st |
|
Balance at January 1 |
|
Acquisitions |
|
Foreign exchange, other |
|
Balance at December 31 |
Pharmaceuticals |
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CURNA |
$ |
4,827 |
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$ |
— |
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$ |
— |
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|
$ |
4,827 |
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$ |
4,827 |
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$ |
— |
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$ |
— |
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$ |
4,827 |
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EirGen |
— |
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|
83,373 |
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(2,234 |
) |
|
81,139 |
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|
— |
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— |
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— |
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— |
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FineTech |
11,698 |
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— |
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|
— |
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|
11,698 |
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|
11,698 |
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— |
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— |
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|
11,698 |
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OPKO Biologics |
139,784 |
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|
— |
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— |
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|
139,784 |
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|
139,784 |
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— |
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— |
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|
139,784 |
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OPKO Chile |
5,283 |
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— |
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(766 |
) |
|
4,517 |
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|
6,102 |
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— |
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(819 |
) |
|
5,283 |
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OPKO Health Europe |
8,013 |
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— |
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|
(822 |
) |
|
7,191 |
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|
9,075 |
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— |
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(1,062 |
) |
|
8,013 |
|
OPKO Mexico |
100 |
|
|
— |
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(100 |
) |
|
— |
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|
114 |
|
|
— |
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(14 |
) |
|
100 |
|
OPKO Renal |
2,069 |
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|
— |
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|
— |
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|
2,069 |
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|
2,069 |
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— |
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|
— |
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|
2,069 |
|
SciVac |
1,553 |
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|
— |
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|
(1,553 |
) |
|
— |
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|
1,739 |
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— |
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|
(186 |
) |
|
1,553 |
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Diagnostics |
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Bio-Reference |
— |
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|
441,158 |
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— |
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|
441,158 |
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— |
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— |
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— |
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|
— |
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OPKO Diagnostics |
17,977 |
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|
— |
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|
— |
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|
17,977 |
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|
17,977 |
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— |
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|
— |
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|
17,977 |
|
OPKO Lab |
32,988 |
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— |
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— |
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|
32,988 |
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|
32,988 |
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— |
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|
— |
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|
32,988 |
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$ |
224,292 |
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$ |
524,531 |
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$ |
(5,475 |
) |
|
$ |
743,348 |
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|
$ |
226,373 |
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|
$ |
— |
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$ |
(2,081 |
) |
|
$ |
224,292 |
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|