Discontinued Operations

3 Months Ended

Mar. 31, 2012

Discontinued Operations

Note 15 – Discontinued Operations

In 2009, the Company began its Regenerative Medicine-China business in the People’s Republic of China (“China” or “PRC”) through its subsidiary, a wholly foreign owned entity (“WFOE”) and entered into contractual arrangements with certain variable interest entities (“VIEs”). Foreign companies have commonly used VIE structures to operate in the PRC, and while such structures are not uncommon, recently they have drawn greater scrutiny from the local Chinese business community in the PRC who have urged the PRC State Council to clamp down on these structures. In addition, in December 2011, China’s Ministry of Health announced its intention to more tightly regulate stem cell clinical trials and stem cell therapeutic treatments in the PRC, which has created uncertainty regarding the ultimate regulatory environment in the PRC. Accordingly, the Company has been taking steps to restrict, with the expectation of ultimately eliminating, its regenerative medicine business in the PRC. The Company has concluded that as a result of these steps, to discontinue operations in its Regenerative Medicine-China business. The Company has determined that any liability arising from the activities of the WFOE and the VIEs will likely be limited to the net assets currently held by each entity. As of March 31, 2012, the Company recognized the following loss on exit of the Regenerative Medicine-China business (in thousands):

Cash	$	195.1
Prepaid expenses and other current assets		14.9
Property, plant and equipment, net		1,023.7
Other Assets		330.5
Accounts payable		(177.1	)
Accrued liabilities		(79.2	)
Accumulated comprehensive income		(169.9	)
Loss on exit of segment	$	1,138.0

The operations and cash flows of the Regenerative Medicine - China business will be eliminated from ongoing operations as a result of our exit decision. The Company expects to have no continuing involvement in this business going forward. The operating results of the Regenerative Medicine – China business for the three months ended March 31, 2012 and 2011, which are included in discontinued operations, were as follows (in thousands):

	Three Months Ended March 31,
	2012			2011
Revenue	$	52.3		$	50.2
Cost of revenues		(30.6	)		(18.1	)
Research and development		(103.3	)		(158.1	)
Selling, general, and administrative		(497.3	)		(790.1	)
Other income (expense)		(6.8	)		(12.7	)
Loss on exit of segment		(1,138.0	)		-
Loss from discontinued operations	$	(1,723.7	)	$	(928.8	)

The summary of the assets and liabilities related to discontinued operations as of December 31, 2011 was as follows (in thousands):

	December 31, 2011
Assets
Cash and cash equivalents	$	103.3
Prepaid expenses and other current assets		284.4
Property, plant and equipment, net		1,256.8
Other Assets		149.0
	$	1,793.5
Liabilities
Accounts payable	$	177.8
Accrued liabilities		31.0
	$	208.8