Note 9 - Intangible Assets, net:

($ amounts in thousands)



	June 30, 2012		December 31, 2011
In-process research and development acquired in the Anchen Acquisition, net of accumulated amortization of $0 and $0	$	124,700	126,700
Developed products acquired in the Anchen Acquisition, net of accumulated amortization of $13,036 and $1,650	72,164		83,550
QOL Medical, LLC Asset Purchase Agreement, net of accumulated amortization of $14,820 and $12,540	39,901		42,181
Teva Pharmaceuticals, Inc. Asset Purchase Agreement, net of accumulated amortization of $2,664 and $1,255	15,336		16,745
Glenmark Generics Limited and Glenmark Generics, Inc. USA Licensing Agreement, net of accumulated amortization of $0 and $0	15,000		15,000
Synthon Pharmaceuticals, Inc. Asset Purchase Agreement, net of accumulated amortization of $0 and $0	9,600		9,600
Covenant not-to-compete acquired in the Anchen Acquisition, net of accumulated amortization of $1,842 and $358	7,059		8,542
Teva Pharmaceuticals, Inc. License and Distribution Agreement, net of accumulated amortization of $4,000 and $0	2,000		6,000
In-process research and development acquired in the Edict Acquisition, net of accumulated amortization of $0	1,100		—
Genpharm, Inc. Distribution Agreement, net of accumulated amortization of $10,109 and $9,748	724		1,085
Covenant not-to-compete acquired in the Edict Acquisition, net of accumulated amortization of $94	656		—
SVC Pharma LP License and Distribution Agreement, net of accumulated amortization of $3,278 and $3,034	406		650
Other intangible assets, net of accumulated amortization of $7,231 and $7,209	391		414
Trademark licensed from Bristol-Myers Squibb Company, net of accumulated amortization of $10,000 and $9,148	—		852
MDRNA, Inc. Asset Purchase Agreement, net of accumulated amortization of $2,100 and $1,750	—		350
	$	289,037	$	311,669

We recorded amortization expense related to intangible assets of $22,482 thousand for the six months ended June 30, 2012 and $6,118 thousand for the six months ended June 30, 2011. The majority of this amortization expense was included in cost of goods sold.

On November 17, 2011, Par completed the Anchen Acquisition. Refer to Note 2, “Anchen Acquisition” for details of the transaction. As part of the Anchen Acquisition, we acquired intangible assets related to IPR&D, products derived from developed technology, and a covenant not to compete from a former Anchen securityholder and employee.

The value of in-process research and development acquired in the Anchen Acquisition was capitalized and accounted for as an indefinite-lived intangible asset and will be subject to impairment testing until the completion or abandonment of each project. Upon successful completion and launch of each project, we will make a separate determination of useful life of the IPR&D intangible. Amortization expense of the related intangible assets will commence when each product is launched. During the six months ended June 30, 2012, we abandoned an in-process research and development project acquired in the Anchen Acquisition and recorded an intangible asset impairment of $2,000 thousand.

On October 18, 2011, we announced that we acquired rights to three products from Teva Pharmaceuticals in connection with Teva’s acquisition of Cephalon. Under terms of the agreements, Par owns the ANDAs of fentanyl citrate lozenges, a generic version of Actiq®, and cyclobenzaprine ER capsules, the generic version of Amrix®, as well as the U.S. rights to market modafinil tablets, the generic version of Provigil®. Par began shipping to the trade all strengths of fentanyl citrate lozenges shortly after the acquisition. Par began shipping to the trade all strengths of modafinil tablets in April 2012. Cyclobenzaprine ER capsules and modafinil tablets were not previously marketed by Teva. We paid $24,000 thousand to acquire fentanyl citrate lozenges and modafinil tablets. We would also be obligated to pay up to an additional $1,000 thousand milestone upon the launch of cyclobenzaprine ER capsules depending on timing of our launch. In April 2012, Cephalon, a subsidiary of Teva Pharmaceutical Industries Ltd., won an appeal in the US Court of Appeals for the Federal Circuit in Washington reversing a lower court decision to invalidate Cephalon’s existing patents covering cyclobenzaprine ER capsules, which expire in 2023 and 2025. We allocated the $24,000 thousand paid for fentanyl citrate lozenges ($18,000 thousand) and for modafinil tablets ($6,000 thousand) based on expected future cash flows. The remaining net book value of the intangible asset related to fentanyl citrate lozenges ($15,336 thousand) will be amortized over approximately five years. Amortization expense of the intangible asset related to modafinil tablets commenced when the product was launched in April 2012.

Estimated Amortization Expense for Existing Intangible Assets at June 30, 2012

The following table does not include estimated amortization expense for future milestone payments that may be paid and result in the creation of intangible assets after June 30, 2012.

($ amounts in thousands)



	Estimated Amortization Expense
2012	$	15,820
2013	33,711
2014	47,304
2015	44,602
2016	39,691
2017 and thereafter	107,909
	$	289,037

As of June 30, 2012, we determined through our evaluation that intangible assets were recoverable.