| Goodwill £m | Software £m | Development costs £m | Patent rights £m | Marketing authorisations £m | Acquired intangibles £m | Total £m | |
|---|---|---|---|---|---|---|---|
| Cost | |||||||
| At 1 July 2017 | 128.1 | 12.7 | 11.7 | 5.3 | 1.0 | 409.4 | 568.2 |
| Additions | – | 4.2 | 1.7 | 0.9 | – | 8.7 | 15.5 |
| Acquisitions through business combinations | 102.3 | – | – | (2.1) | – | 262.3 | 362.5 |
| Remeasurement | – | – | – | – | – | (3.1) | (3.1) |
| Disposals | – | – | (0.2) | (0.2) | – | – | (0.4) |
| Foreign exchange adjustments | (1.1) | (0.2) | – | – | (0.1) | (3.3) | (4.7) |
| At 30 June 2018 and 1 July 2018 | 229.3 | 16.7 | 13.2 | 3.9 | 0.9 | 674.0 | 938.0 |
| Additions | – | 2.8 | 1.2 | – | – | 7.9 | 11.9 |
| Acquisitions through business combinations | 18.8 | 0.1 | – | 0.4 | – | 18.2 | 37.5 |
| Remeasurement | – | – | – | – | – | (1.5) | (1.5) |
| Disposals | – | – | (0.3) | – | – | – | (0.3) |
| Foreign exchange adjustments | 4.0 | 0.1 | (0.1) | – | – | 11.2 | 15.2 |
| At 30 June 2019 | 252.1 | 19.7 | 14.0 | 4.3 | 0.9 | 709.8 | 1,000.8 |
| Accumulated Amortisation | |||||||
| At 1 July 2017 | – | 2.9 | 6.1 | 3.1 | – | 159.8 | 171.9 |
| Charge for the year | – | 0.8 | 1.2 | 0.5 | – | 54.1 | 56.6 |
| Acquisitions through business combinations | – | – | – | (0.4) | – | – | (0.4) |
| Impairment | – | 0.1 | – | – | – | – | 0.1 |
| Disposals | – | – | (0.2) | (0.2) | – | – | (0.4) |
| Foreign exchange adjustments | – | (0.1) | – | – | – | 0.5 | 0.4 |
| At 30 June 2018 and 1 July 2018 | – | 3.7 | 7.1 | 3.0 | – | 214.4 | 228.2 |
| Charge for the year | – | 2.5 | 1.3 | 0.3 | – | 76.8 | 80.9 |
| Foreign exchange adjustments | – | (0.1) | 0.1 | – | – | 4.7 | 4.7 |
| At 30 June 2019 | – | 6.1 | 8.5 | 3.3 | – | 295.9 | 313.8 |
| Net book value | |||||||
| At 30 June 2019 | 252.1 | 13.6 | 5.5 | 1.0 | 0.9 | 413.9 | 687.0 |
| At 30 June 2018 | 229.3 | 13.0 | 6.1 | 0.9 | 0.9 | 459.6 | 709.8 |
The assets within patent rights comprises the rights to Equidone® (which was launched in the USA during 2011, and has a carrying value of £0.3 million with a remaining amortisation period of 2 years), and the in-licensed products within Canada (acquired in 2016 with a carrying value of £0.3 million and has a remaining amortisation period of 7.5 years). During the year, £0.4 million was added to patent rights within EU Pharmaceuticals Segment from the acquisition of Venco.
£0.8 million of the marketing authorisations relate to the Vetivex® range of products. Ownership of the marketing authorisations rests with the Group in perpetuity. There are not believed to be any legal, regulatory or contractual provisions that limit their useful lives. Vetivex is an established range of products which are relatively simple in nature and there are a limited number of players in the market. Accordingly, the Directors believe that it is appropriate that the marketing authorisations are treated as having indefinite lives for accounting purposes.
Goodwill is allocated across cash generating units that are expected to benefit from that business combination. Key assumptions made in this respect are given in note 14.
During the year, the contingent consideration in relation to development milestones and sales milestones of the acquired intangibles has been remeasured and to the extent possible remeasured against the intangibles.
In accordance with the disclosure requirements of IAS 38 'Intangible Assets', the components of acquired intangibles are summarised below:
| Commercial relationships £m | Pharmacological process £m | Brand £m | Capitalised development costs £m | Product rights £m | Total £m | |
|---|---|---|---|---|---|---|
| Cost | ||||||
| At 1 July 2017 | 1.7 | 50.5 | 13.3 | 114.5 | 229.4 | 409.4 |
| Additions | – | – | – | – | 8.7 | 8.7 |
| Acquisitions through business combinations | 4.9 | – | 2.4 | 255.0 | – | 262.3 |
| Remeasurement | – | – | – | – | (3.1) | (3.1) |
| Foreign exchange adjustments | 0.1 | (0.9) | (0.3) | (2.2) | – | (3.3) |
| At 30 June 2018 and 1 July 2018 | 6.7 | 49.6 | 15.4 | 367.3 | 235.0 | 674.0 |
| Additions | – | – | – | – | 7.9 | 7.9 |
| Reclassification* | – | – | – | 2.9 | (2.9) | – |
| Acquisitions through business combinations | – | – | 0.6 | 17.6 | – | 18.2 |
| Remeasurement | – | – | – | – | (1.5) | (1.5) |
| Foreign exchange adjustments | 0.1 | 1.8 | 0.3 | 5.8 | 3.2 | 11.2 |
| At 30 June 2019 | 6.8 | 51.4 | 16.3 | 393.6 | 241.7 | 709.8 |
| Accumulated Amortisation | ||||||
| At 1 July 2017 | 0.6 | 12.2 | 2.3 | 20.4 | 124.3 | 159.8 |
| Charge for the year | 0.7 | 8.0 | 2.1 | 26.9 | 16.4 | 54.1 |
| Foreign exchange adjustments | – | – | – | 0.1 | 0.4 | 0.5 |
| At 30 June 2018 and 1 July 2018 | 1.3 | 20.2 | 4.4 | 47.4 | 141.1 | 214.4 |
| Charge for the year | 2.3 | 6.8 | 1.6 | 55.0 | 11.1 | 76.8 |
| Reclassification* | – | – | – | 0.2 | (0.2) | – |
| Foreign exchange adjustments | 0.1 | 0.9 | 0.1 | 1.7 | 1.9 | 4.7 |
| At 30 June 2019 | 3.7 | 27.9 | 6.1 | 104.3 | 153.9 | 295.9 |
| Net book value | ||||||
| At 30 June 2019 | 3.1 | 23.5 | 10.2 | 289.3 | 87.8 | 413.9 |
| At 30 June 2018 | 5.4 | 29.4 | 11.0 | 319.9 | 93.9 | 459.6 |
* Apex IPR&D acquired October 2016 has been reclassified from Patent rights to Capitalised development costs.
The table below provides further detail on the acquired intangibles and their remaining amortisation period.
| Significant assets | Description | Carrying value £m | Sub-Total carrying value £m | Remaining amortisation period |
|---|---|---|---|---|
| Intangible assets arising from the acquisition of Dermapet | Product, marketing and distribution rights | 20.4 | 20.4 | 6 ½ years |
| Intangible assets arising from the acquisition of Genetrix | Product, marketing and distribution rights | 0.8 | 0.8 | 1 ½ years |
| Intangible assets arising from the acquisition of Eurovet | Technology, product, marketing and distribution rights | 25.3 | 25.3 | 3 years |
| Intangible assets arising from the acquisition of PSPC Inc | Product, marketing and distribution rights | 3.2 | 3.2 | 5 years |
| Intangible asset acquired from Pharmaderm Animal Health | Marketing and distribution rights | 0.5 | 0.5 | 3 years |
| HY-50 intangible asset acquired from Bexinc Limited | Marketing and distribution rights | 1.3 | 1.3 | 2 ½ years |
| Intangible assets arising from the acquisition of Genera | Product, brand, technology, marketing and distribution rights | 0.8 | 3 ½ years | |
| 0.4 | 6 ½ years | |||
| 7.4 | 11 ½ years | |||
| 8.6 | Genera – total | |||
| Intangible assets arising from the acquisition of Putney | Product, brand, technology, pharmacological process, marketing and distribution rights | 6.8 | 7 years | |
| 23.9 | 7 years | |||
| 46.8 | 9 years | |||
| 77.5 | Putney – total | |||
| Intangible asset arising from the acquisition of Apex | Product and technology | 13.4 | 14 years | |
| 2.1 | 11 years | |||
| 0.2 | 2 years | |||
| 15.7 | Apex – total | |||
| Intangible asset related to Animal Ethics | Marketing and distribution rights | 27.3 | 27.3 | 10 years |
| Intangible asset related to a US dental licensing agreement | Marketing and distribution rights | 0.6 | 0.6 | 8 years |
| Intangible asset related to Bioveta | Marketing and distribution rights | 2.1 | 2.1 | 10 years |
| Intangible asset related to an injectable solution licensing agreement | Marketing and distribution rights | 6.1 | 6.1 | 10 years |
| Intangible assets arising from the acquisition of RxVet | Brand | 0.1 | 0.1 | ½ year |
| Intangible assets arising from the acquisition of AST Farma and Le Vet |
Product, brand, technology, marketing and distribution rights |
72.1 108.3 15.3 1.4 1.8 |
8 ½ years 7 ½ years 9 years 1 ½ years 3 ½ years |
|
| 198.9 | AST Farma and Le Vet – total |
|||
| Intangible asset related to Premune | Product | 0.1 | 0.1 | 2 years |
| Intangible assets related to an injectable solution licensing agreement | Marketing and distribution rights | 7.9 | 7.9 | 15 years |
| Intangible assets arising from the acquisition of Caledonian | Product, brand, technology, marketing and distribution rights | 3.9 | 3.9 | 4 ½ years |
| Intangible assets arising from the acquisition of Venco | Product, brand, technology, marketing and distribution rights | 11.9 0.7 0.6 0.4 |
13.6 |
9 ½ years 4 ½ years 7 ½ years 1 ½ years Venco –total |
| 413.9 |