Company: PCRX
Filing Date: 2025-02-27
Form Type: 10-K
Source: 0001396814-25-000041
Chunk: 229

Company: Pacira BioSciences, Inc.
Filing Date: 2025-02-27
Form: 10-K
Item: Item 1A
Chunk 229
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 and this would result in a noncash charge to our statement of operations, which could be material. Events and conditions that could result in an impairment include but are not limited to: changes in assumptions regarding future revenue or cash flow forecasts, increased competition or loss of market share, obsolescence, product claims that result in a significant loss of sales or profitability over the product life, deterioration in macroeconomic conditions or declining financial performance in comparison to projected results.

For example, in 2022, we recognized a $26.1 million impairment charge related to an intangible asset for acquired in-process research and development related to ZILRETTA for the treatment of OA pain of the shoulder, driven by facts and circumstances revealed in the fourth quarter of 2022 that suggested the fair value reduction in this intangible asset was driven by later timelines for the completion of clinical trials impacting revenue forecasts, among other factors. For additional information, see Note 8, Goodwill and Intangible Assets, to our consolidated financial statements included herein. Further 

Pacira BioSciences, Inc.  |  2024 Annual Report on Form 10-K  |  Page 62

changes to the assumptions regarding the future fair values of our intangible assets could result in additional impairment charges in the future, which could be significant.

Previously, a significant portion of our total assets was comprised of goodwill. Pursuant to U.S. generally accepted accounting principles, we are required to assess our goodwill and indefinite-lived intangible assets for impairment. Goodwill is not amortized but is subject to impairment testing at least annually or when a triggering event occurs that could indicate a potential impairment exists. In July 2024, the FDA approved a generic competitor to EXPAREL and in August 2024, a U.S. District Court ruled that one of our EXPAREL patents was not valid. We determined that these events, combined with a subsequent decrease in our common stock price, indicated that it was more likely than not that the fair value of goodwill may be less than its carrying value, which required us to perform a quantitative impairment test. This quantitative impairment test resulted in our carrying value exceeding the fair value of the Company by more than the goodwill balance. As a result, our goodwill balance of $163.2 million was fully impaired during the three months ended September 30, 2024. For more information, see Note 8, Goodwill and Intangible Assets, to our consolidated financial statements included herein. In February 2025,