The Company has identified its laboratory services business and its therapeutic development business as its two operating segments, and the Company determined that the two operating segments represented the two reporting units.

The Company tests for goodwill impairment at the reporting unit level on December 31st of each year and more frequently if events or circumstances indicate a potential impairment.

The Company recognized a full goodwill impairment loss for the goodwill of its laboratory services reporting unit as of December 31, 2023 due to a continued decline in its share price and market capitalization.

Based upon the results of the quantitative assessments the Company performed as of December 31, 2023, the Company concluded that the fair values of the therapeutic development reporting unit and the IPR&D asset at December 31, 2023, were greater than the carrying values and that there was no impairment. There have been no significant changes in the six months ended June 30, 2024.

There can be no assurance that the estimates and assumptions management made for the purposes of the goodwill or IPR&D impairment analysis will prove to be accurate predictions of future performance. It is possible that the conclusions regarding impairment or recoverability of goodwill or intangible assets could change in future periods. Management will continue to monitor the therapeutic development reporting unit. For all IPR&D projects, there are major risks and uncertainties associated with the timely and successful completion of development and commercialization of these product candidates, including the ability to confirm their efficacy based on data from clinical trials, the ability to obtain necessary regulatory approvals, and the ability to successfully complete these tasks within budgeted costs. The Company is not able to market a human therapeutic without obtaining regulatory approvals, and such approvals require completing clinical trials that demonstrate a product candidate is safe and effective. In addition, the availability and extent of coverage and reimbursement from third-party payors, including government healthcare programs and private insurance plans, impact the revenues a product can generate. Consequently, the eventual realized value, if any, of these acquired IPR&D projects may vary from their estimated fair values.

Summaries of intangible asset balances as of June 30, 2024 and December 31, 2023 were as follows:


	Weighted-Average Amortization Period	June 30, 2024			December 31, 2023
		(in thousands)
Laboratory Services:
Royalty-free technology	10 Years	$	5,091		$	5,211
Less: accumulated amortization			(1,612	)		(1,390	)
Royalty-free technology, net			3,479			3,821

Customer Relationships	13 Years		83,092			83,119
Less: accumulated amortization			(15,827	)		(12,586	)
Customer relationships, net			67,265			70,533

Trade name	8 Years		3,790			3,790
Less: accumulated amortization			(1,154	)		(906	)
Trade name, net			2,636			2,884

In-place lease intangible assets	5 Years		360			360
Less: accumulated amortization			(151	)		(116	)
In-place lease intangible assets, net			209			244

Laboratory information system platform	5 Years		1,860			1,860
Less: accumulated amortization			(1,085	)		(899	)
Laboratory information system platform, net			775			961

Purchased patent	10 Years		28			28
Less: accumulated amortization			(9	)		(8	)
Purchased patent, net			19			20
Total			74,383			78,463

Therapeutic Development:
In-process research & development	n/a		64,590			64,590
Total			64,590			64,590
Total intangible assets, net		$	138,973		$	143,053

Acquisition-related intangibles included in the above tables are generally finite-lived and are carried at cost less accumulated amortization, except for IPR&D, which is related to the business combination of Fulgent Pharma in 2022 and has an indefinite life until research and development efforts are completed or abandoned. All other finite-lived acquisition-related intangibles related to the business combinations in 2022 and 2021 are amortized on a straight-line basis over their estimated lives, which approximates the pattern in which the economic benefits of the intangible assets are expected to be realized.

Amortization of intangible assets was $2.0 million and $4.0 million in the three and six months ended June 30, 2024, respectively, and $2.0 million and $3.9 million for the three and six months ended June 30, 2023, respectively.