Derivative Instruments

12 Months Ended

Dec. 31, 2011

Derivative Instruments [Abstract]

Derivative Instruments

NOTE 15 — DERIVATIVE INSTRUMENTS

We utilize a balance sheet hedging program with the stated objective of reducing volatility within Other (expense) income, net. Under this program, we use derivatives in the form of foreign currency contracts to hedge certain balance sheet exposures. We do not designate these contracts as hedging instruments and therefore do not qualify for hedge accounting. Accordingly, these outstanding non-designated derivatives are recognized in the consolidated balance sheets at fair value and the changes in fair value from these contracts are recorded in Other (expense) income, net, in the consolidated income statements. These derivative contracts typically have a one month term.

We have a cash flow hedging program primarily focused on reducing volatility in our forecasted research and development cash expenses and license revenues, some of which are denominated in non-U.S. Dollar currencies. Under this program, we use derivatives in the form of forward foreign currency contracts and foreign currency option contracts to hedge certain forecasted transactions. These derivatives, with durations ranging from less than one month to nine months, are designated as hedging instruments and qualify for hedge accounting. Accordingly, these outstanding designated derivatives are recognized in the consolidated balance sheets at fair value. Changes in value that are highly effective are recognized in Accumulated other comprehensive income ("AOCI") in the consolidated balance sheets, until the hedged item is recognized in the income statement. Any ineffective portion of a derivative's change in fair value is recorded in Other (expense) income, net, in the consolidated income statements. There was no material ineffectiveness in our cash flow hedging program for the twelve months ended December 31, 2011.

We had the following notional amounts for our foreign currency contracts included in our consolidated balance sheets (in U.S. Dollars in thousands):

Currency	December 31 2011		December 31 2010
Derivatives designated as hedging instruments
Australian Dollar	$	4,078	$	2,788
Canadian Dollar		14,158		7,694
Chinese Yuan		2,777		1,167
Israeli Shekel		3,773		2,105
Russian Ruble		8,433		6,206
British Pound		—		7,188
Euro		—		22,029
Total	$	33,219	$	49,177

Derivatives not designated as hedging instruments
Danish Krone	$	891	$	2,126
Norwegian Krone		1,073		2,013
Swedish Krona		446		2,058
Euro		40,397		43,600
Australian Dollar		8,138		3,846
South Korean Won		2,193		—
Brazil Real		3,826		4,705
Japanese Yen		6,439		—
British Pound		7,950		18,724
Total	$	71,353	$	77,072

Fair Value of Derivative Instruments

The following table provides the fair value of our foreign currency contracts included in our consolidated balance sheets (in thousands):

Derivative Assets

Derivative Liabilities

December 31, 2011

December 31, 2010

December 31, 2011

December 31, 2010

Derivatives designated as hedging instruments

Balance Sheet  Location

Fair    Value (1)

Balance Sheet  Location

Fair    Value (1)

Balance Sheet  Location

Fair   Value (1)

Balance Sheet  Location

Fair    Value (1)

Foreign currency contracts

Prepaid expenses and other current assets

$

351

Prepaid expenses and other current assets

$

1,123

Other accrued expenses

$

237

Other accrued expenses

$

424

Derivative Assets

Derivative Liabilities

December 31, 2011

December 31, 2010

December 31, 2011

December 31, 2010

Derivatives not designated as hedging instruments

Balance Sheet  Location

Fair    Value  (1)

Balance Sheet  Location

Fair    Value  (1)

Balance Sheet  Location

Fair   Value  (1)

Balance Sheet  Location

Fair    Value  (1)

Foreign currency contracts

Prepaid expenses and other current assets

$

2,512

Prepaid expenses and other current assets

$

—

Other accrued expenses

$

63

Other accrued expenses

$

956

(1) Please refer to Note 16 – Fair Value Measurements for additional details.

The Effect of Derivative Instruments on Financial Performance

The following tables provide the effect derivative instruments had on our AOCI and results of operations (in thousands):

	Year Ended December 31
Derivatives designated as hedging instruments	Amount of (loss) gain  recognized in AOCI (effective portion)				Location of (loss) gain reclassified from accumulated AOCI into income statement (effective portion)	Amount of (loss)  gain reclassified from accumulated AOCI (effective portion)
	2011		2010			2011		2010
Foreign currency contracts	$	(729)	$	359	Revenues	$	(753)	$	(973)
					Operating expenses	$	668	$	738

	Year Ended December 31
Derivatives not designated as hedging instruments	Location of gain (loss) recognized     on derivative instruments	Amount of gain (loss) recognized on         derivative instruments
		2011		2010
Foreign currency contracts	Other expense, net	$	1,952	$	(459	)