Innoviva, Inc. Goodwill & Intangibles Disclosure
8. GOODWILL AND INTANGIBLE ASSETS
Goodwill and intangible assets acquired are recognized at fair value as of the acquisition date. We recognized goodwill of $11.5 million and $6.4 million from our acquisitions of Entasis and La Jolla, respectively, in 2022. The carrying amount of goodwill as of December 31, 2025 and 2024 was $17.9 million. We have not recognized any impairment losses related to goodwill and intangible assets during the periods presented.
Intangible assets with definite lives are amortized over their estimated useful lives. The carrying basis and accumulated amortization of recognized intangible assets as of December 31, 2025 and 2024 were as follows:
|
|
December 31, 2025 |
|
|||||||||||
|
|
Useful Life |
|
Gross |
|
|
Accumulated |
|
|
Net Carrying |
|
|||
(In thousands) |
|
(Years) |
|
Amount |
|
|
Amortization |
|
|
Amount |
|
|||
Marketed products |
|
8-10 |
|
$ |
226,300 |
|
|
$ |
(70,299 |
) |
|
$ |
156,001 |
|
Collaboration agreement |
|
10 |
|
|
35,400 |
|
|
|
(9,245 |
) |
|
|
26,155 |
|
Total |
|
|
|
$ |
261,700 |
|
|
$ |
(79,544 |
) |
|
$ |
182,156 |
|
|
|
December 31, 2024 |
|
|||||||||||
|
|
Useful Life |
|
Gross |
|
|
Accumulated |
|
|
Net Carrying |
|
|||
(In thousands) |
|
(Years) |
|
Amount |
|
|
Amortization |
|
|
Amount |
|
|||
Marketed products |
|
8-10 |
|
$ |
223,700 |
|
|
$ |
(47,559 |
) |
|
$ |
176,141 |
|
In-process research and development |
|
|
|
|
2,600 |
|
|
|
— |
|
|
|
2,600 |
|
Collaboration agreement |
|
10 |
|
|
35,400 |
|
|
|
(5,708 |
) |
|
|
29,692 |
|
Total |
|
|
|
$ |
261,700 |
|
|
$ |
(53,267 |
) |
|
$ |
208,433 |
|
Intangible assets recognized as a result of the acquisition of Entasis amounted to $106.7 million, which consisted of Entasis’ in-process research and development related to its antibacterial therapeutic product candidates and a collaboration agreement amounting to $71.3 million and $35.4 million, respectively. Following the FDA approval of XACDURO® in May 2023, we started amortizing $68.7 million of the then in-process research and development as a marketed product, as well as the collaboration agreement, over their estimated useful lives. Following the FDA approval of NUZOLVENCE® (formerly zoliflodacin) in December 2025, we started amortizing $2.6 million of the then in-process research and development as a marketed product over its estimated useful life.
Intangible assets recognized as a result of the acquisition of La Jolla amounting to $151.0 million pertain to product rights and developed technologies on La Jolla’s marketed products. These are intangible assets with determinable lives and are amortized over their estimated useful lives.
As discussed in Note 4 “License and Collaboration Arrangements”, we capitalized the upfront fee of $4.0 million that we paid to Basilea for the exclusive commercialization right of ZEVTERA® in the U.S. under our exclusive distribution and license agreement as an intangible asset. This amount is included in marketed products in the table above and is being amortized over the term of the agreement.
We recognized amortization expense of $26.3 million, $25.9 million and $21.8 million for the years ended December 31, 2025, 2024 and 2023, respectively. Future amortization expense is expected to be $26.6 million for each of the years from 2026 to 2030 and $49.2 million thereafter.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 25, 2026 | Showing above |
| 2024 | Feb 26, 2025 | |
| 2023 | Feb 29, 2024 | |
| 2022 | Feb 28, 2023 | |
About Goodwill & Intangibles Disclosures
Goodwill and intangible asset disclosures reveal the premium paid in acquisitions and how management assesses whether that premium retains its value. Since goodwill is no longer amortized under US GAAP, the annual impairment test is the only mechanism that adjusts carrying values downward — making the assumptions behind that test critically important for investors.
Key signals: a history of goodwill impairments suggests management consistently overpays for acquisitions. Watch the gap between reporting unit fair value and carrying amount — when fair value exceeds carrying amount by less than 10-20%, a small decline in business performance could trigger a write-down. For finite-lived intangibles, examine useful life assumptions across customer relationships, technology, and trade names; aggressive estimates inflate near-term earnings. Compare total intangibles-to-total-assets ratios against peers to assess acquisition dependency. Rising goodwill as a percentage of equity can signal balance sheet fragility.