UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): November 6, 2013
PDL BioPharma, Inc.
(Exact name of Company as specified in its charter)
000-19756
(Commission File Number)
Delaware | 94-3023969 | |
(State or Other Jurisdiction of Incorporation) | (I.R.S. Employer Identification No.) | |
932 Southwood Boulevard
Incline Village, Nevada 89451
(Address of principal executive offices, with zip code)
(775) 832-8500
(Company’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Company under any of the following provisions:
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 2.02 Results of Operations and Financial Condition.
On November 6, 2013, PDL BioPharma, Inc. (the Company) issued a press release announcing the financial results for the third quarter ended September 30, 2013. A copy of this earnings release is attached hereto as Exhibit 99.1. The Company will host an earnings call and webcast on November 6, 2013, during which the Company will discuss its financial results for the third quarter ended September 30, 2013.
Item 7.01 Regulation FD Disclosure.
Presentation Materials
On November 6, 2013, the Company posted to its website a set of presentation materials that it will use during its earnings call and webcast to assist participants with understanding the Company’s financial results. A copy of this presentation is attached hereto at Exhibit 99.2.
Information Sheet
On November 6, 2013, the Company distributed to analysts covering the Company’s securities a summary of certain information regarding the Company’s net income, dividends, recent transactions and licensed product development and sales (the Information Sheet) to assist those analysts in valuing the Company’s securities. The Information Sheet and its associated tables are attached hereto as Exhibit 99.3.
Limitation of Incorporation by Reference
In accordance with General Instruction B.2. of Form 8-K, the information in this report, including the exhibits, is furnished pursuant to Items 2.02 and 7.01 and shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section.
Cautionary Statements
This filing and its exhibits include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we can give no assurance that such expectations will prove to be correct. Important factors that could impair the Company’s royalty assets or business are disclosed in the “Risk Factors” contained in the Company’s Annual Report on Form 10-K, as updated by subsequent quarterly reports, filed with the Securities and Exchange Commission. All forward-looking statements are expressly qualified in their entirety by such factors. We do not undertake any duty to update any forward-looking statement except as required by law.
Item 9.01 Financial Statements and Exhibits.
Exhibit No. | Description | |
99.1 | Press Release | |
99.2 | Presentation | |
99.3 | Information Sheet | |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
PDL BIOPHARMA, INC. | ||
(Company) | ||
By: | /s/ Peter S. Garcia | |
Peter S. Garcia | ||
Vice President and Chief Financial Officer | ||
Dated: November 6, 2013
Exhibit Index
Exhibit No. | Description | |
99.1 | Press Release | |
99.2 | Presentation | |
99.3 | Information Sheet | |
Exhibit 99.1
Contacts: | ||
Peter Garcia | Jennifer Williams | |
PDL BioPharma, Inc. | Cook Williams Communications, Inc. | |
775-832-8500 | 360-668-3701 | |
Peter.Garcia@pdl.com | jennifer@cwcomm.org | |
PDL BioPharma Announces Third Quarter 2013 Financial Results
-Revenues Increased 14 Percent-
INCLINE VILLAGE, NV, November 6, 2013 – PDL BioPharma, Inc. (PDL) (NASDAQ: PDLI) today reported financial results for the third quarter and nine months ended September 30, 2013.
Total revenues for the third quarter of 2013 increased 14 percent to $97.3 million from $85.2 million reported in the third quarter of 2012. For the first nine months of 2013, total revenues increased 15 percent to $332.8 million from $288.5 million reported in the comparable period of 2012.
Royalty revenues for the third quarter of 2013 are based on second quarter 2013 product sales by PDL’s licensees. The year-to-date royalty revenue growth is driven by increased sales of Avastin ®, Herceptin ®, Lucentis ®, Perjeta ®, Kadcyla ®, and Actemra ® by PDL's licensees in the fourth quarter of 2012 and the first and second quarters of 2013. Net sales of Avastin, Herceptin, Lucentis, Xolair®, Perjeta, and Kadcyla are subject to a tiered royalty rate except in the case when the product is ex-U.S. manufactured and sold, in which case it is subject to a flat three percent royalty rate.
General and administrative expenses for the third quarter of 2013 were $7.9 million, compared with $5.6 million in the same quarter of 2012. For the nine months ended September 30, 2013, general and administrative expenses were $21.9 million compared to $17.7 million in the comparable period of 2012. The increase in expenses for both the quarter and nine months ended September 30, 2013, was a result of increased legal expenses related to ongoing litigation.
Net income for the third quarter of 2013 was $56.2 million, or $0.36 per diluted share, as compared with net income of $48.6 million, or $0.32 per diluted share, in the same quarter of 2012. The increase in net income in the third quarter is primarily due to a 13 percent increase in royalty revenues. Net income for the first nine months of 2013 was $203.4 million, or $1.31 per diluted share, as compared with net income of $162.3 million, or $1.08 per diluted share, in the same period of 2012.
Net cash provided by operating activities in the first nine months of 2013 was $209.7 million, compared with $158.6 million for the first nine months of 2012. At September 30, 2013, PDL had cash, cash equivalents and investments of $326.5 million, compared with $148.7 million at December 31, 2012. The increase was primarily attributable to net cash provided by operating activities of $209.7 million and repayment of notes receivable of $58.1 million, offset in part by payment of dividends of $62.9 million and cash advanced on notes receivable of $48.7 million.
“We are gratified by the continued success of our asset acquisition strategy, including the four additional transactions completed in the past month, and believe that-with ROI at top-of-mind-we are continuing to add long term value for the company and our stockholders,” stated John P. McLaughlin, president and chief executive officer of PDL. “Our goal is to be the financial partner of choice to leading life science companies and other institutions seeking to access non-dilutive capital, and we are actively looking to expand our portfolio. With the conclusion of the four recent transactions, PDL has deployed $368 million in capital in 2013 and $496 million in total to acquire new income generating assets to support our dividend payments.”
Recent Developments
Debt Financing Provided to Direct Flow Medical, Inc.
On November 5, 2013, PDL entered into a debt financing transaction with Direct Flow Medical, Inc. (DFM), a transcatheter heart valve innovator focused on improving patient outcomes. PDL will provide a total of up to $50 million to DFM to be used to refinance its existing credit facility and fund the commercialization of its transcatheter aortic valve system used to treat aortic stenosis. An initial $35 million was provided at the close of the transaction, with the remaining $15 million to be funded upon the achievement of a specified revenue milestone.
Debt Financing Provided to Durata Therapeutics, Inc.
On October 31, 2013, PDL entered into a debt financing transaction with Durata Therapeutics, Inc. , a pharmaceutical company focused on the development and commercialization of novel therapeutics for patients with infectious diseases and acute illnesses. PDL will provide Durata with up to $70 million of debt financing to be used to refinance its existing credit facility and fund the commercialization of dalbavancin, an intravenous antibiotic product candidate, for the treatment of patients with acute bacterial skin and skin structure infections, or ABSSSI, caused by Gram-positive bacteria, such as S. aureus, including methicillin-resistant and multi-drug resistant strains, and certain streptococcal species. An initial $25 million was provided at the close of the transaction. The agreement provides up to $45 million in additional funds to Durata, with $15 million of funding upon regulatory approval of dalbavancin, and the remaining $30 million funded within nine months after regulatory approval of dalbavancin.
Acquisition of Diabetes Royalty Rights and Milestones from Depomed, Inc.
On October 18, 2013, PDL acquired the rights to receive royalties and milestones payable on sales of Type 2 diabetes products licensed by Depomed in exchange for a $240.5 million cash payment. PDL will receive all royalty and milestone payments due under the agreements until it has received payments equal to two times the cash payment made to Depomed, after which all payments received will be shared evenly between PDL and Depomed.
The rights acquired include Depomed's royalty and milestone payments accruing from and after October 1, 2013: (a) from Santarus with respect to sales of Glumetza® (metformin HCL extended-release tablets) in the United States; (b) from Merck with respect to sales of Janumet® XR (sitagliptin and metformin HCL extended-release); (c) from Janssen Pharmaceutica with respect to potential future development milestones and sales of its investigational fixed-dose combination of Invokana® (canagliflozin) and extended-release metformin; (d) from Boehringer Ingelheim with respect to potential future development milestones and sales of the investigational fixed-dose combinations of drugs and extended-release metformin subject to Depomed's license agreement with Boehringer Ingelheim; and (e) from LG Life Sciences and Valeant Pharmaceuticals for sales of extended-release metformin in Korea and Canada, respectively.
Debt Financing Provided to LENSAR, Inc.
On October 1, 2013, PDL entered into a credit agreement with LENSAR, Inc., a leader in the development and commercialization of a more intelligent solution for refractive laser-assisted cataract surgery. PDL will provide LENSAR with up to $60 million of debt financing to be used to refinance its existing credit facility and fund the commercialization of its currently marketed LENSAR Laser System. An initial $40 million was provided at close of the transaction, with the remaining $20 million to be funded upon the attainment of a specified sales milestone.
2013 Dividends
On January 30, 2013, PDL’s Board of Directors declared regular quarterly dividends of $0.15 per share of common stock, payable on March 12, June 12, September 12 and December 12 of 2013 to all stockholders who own shares of PDL on March 5, June 5, September 5 and December 5 of 2013, the record dates for each of the dividend payments, respectively. On September 12, 2013, PDL paid the third quarterly dividend to stockholders of record totaling $21.0 million using earnings generated in the third quarter of 2013.
Revenue Guidance for 2013
As previously announced, PDL will continue to provide revenue guidance for each quarter in the third month of that quarter. Fourth quarter 2013 revenue guidance will be provided in December.
Conference Call Details
PDL will hold a conference call to discuss financial results at 4:30 p.m. Eastern Time today, November 6, 2013.
To access the live conference call via phone, please dial (800) 668-4132 from the United States and Canada or (224) 357-2196 internationally. The conference ID is 93070209. Please dial in approximately 10 minutes prior to the start of the call. A telephone replay will be available beginning approximately one hour after the call through November 12, 2013, and may be
accessed by dialing (855) 859-2056 from the United States and Canada or (404) 537-3406 internationally. The replay passcode is 93070209.
To access the live and subsequently archived webcast of the conference call, go to the Company’s website at http://www.pdl.com and go to “Events & Presentations.” Please connect to the website at least 15 minutes prior to the call to allow for any software download that may be necessary.
About PDL BioPharma, Inc.
PDL BioPharma manages a portfolio of patents and royalty assets, consisting primarily of its Queen et al. antibody
humanization patents and license agreements with various biotechnology and pharmaceutical companies. PDL pioneered the
humanization of monoclonal antibodies and, by doing so, enabled the discovery of a new generation of targeted treatments for
cancer and immunologic diseases for which it receives significant royalty revenue. PDL is currently focused on intellectual
property asset management, investing in new income generating assets, and maximizing value for its shareholders.
The company was formerly known as Protein Design Labs, Inc. and changed its name to PDL BioPharma, Inc. in 2006. PDL
was founded in 1986 and is headquartered in Incline Village, Nevada.
In 2011, PDL initiated a strategy to bring in new income generating assets from the healthcare sector. To accomplish this goal,
PDL seeks to provide non-dilutive growth capital and financing solutions to late stage public and private healthcare companies and offers immediate financial monetization of royalty streams to companies, academic institutions, and inventors. PDL successfully executed on this strategy by deploying approximately $500 million to date and continues to pursue this strategic initiative. PDL is focused on the quality of the income generating assets and potential returns on investment.
For more information, please visit www.pdl.com.
NOTE: PDL BioPharma and the PDL BioPharma logo are considered trademarks of PDL BioPharma, Inc.
Forward-looking Statements
This press release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Each of these forward-looking statements involves risks and uncertainties. Actual results may differ materially from those, express or implied, in these forward-looking statements. Important factors that could impair the value of the Company's royalty assets, restrict or impede the ability of the Company to invest in new royalty bearing assets and limit the Company's ability to pay dividends are disclosed in the risk factors contained in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission and updated by subsequent Quarterly Reports on Form 10-Q. All forward-looking statements are expressly qualified in their entirety by such factors. We do not undertake any duty to update any forward-looking statement except as required by law.
PDL BIOPHARMA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME DATA
(Unaudited)
(In thousands, except per share amounts)
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Revenues | ||||||||||||||||
Royalties | $ | 96,314 | $ | 85,231 | $ | 331,778 | $ | 288,479 | ||||||||
License and other | 1,000 | — | 1,000 | — | ||||||||||||
Total revenues | 97,314 | 85,231 | 332,778 | 288,479 | ||||||||||||
Operating Expenses | ||||||||||||||||
General and administrative expenses | 7,925 | 5,647 | 21,894 | 17,737 | ||||||||||||
Operating income | 89,389 | 79,584 | 310,884 | 270,742 | ||||||||||||
Non-operating expense, net | ||||||||||||||||
Interest and other income, net | 2,917 | 1,867 | 11,718 | 2,385 | ||||||||||||
Interest expense | (6,118 | ) | (6,514 | ) | (18,169 | ) | (23,087 | ) | ||||||||
Total non-operating expense, net | (3,201 | ) | (4,647 | ) | (6,451 | ) | (20,702 | ) | ||||||||
Income before income taxes | 86,188 | 74,937 | 304,433 | 250,040 | ||||||||||||
Income tax expense | 29,963 | 26,362 | 100,995 | 87,779 | ||||||||||||
Net income | $ | 56,225 | $ | 48,575 | $ | 203,438 | $ | 162,261 | ||||||||
Net income per share | ||||||||||||||||
Basic | $ | 0.40 | $ | 0.35 | $ | 1.45 | $ | 1.16 | ||||||||
Diluted | $ | 0.36 | $ | 0.32 | $ | 1.31 | $ | 1.08 | ||||||||
Shares used to compute income per basic share | 139,848 | 139,715 | 139,830 | 139,693 | ||||||||||||
Shares used to compute income per diluted share | 154,593 | 149,626 | 155,366 | 150,678 | ||||||||||||
Cash dividends declared per common share | $ | — | $ | — | $ | 0.60 | $ | 0.60 | ||||||||
PDL BIOPHARMA, INC.
CONDENSED CONSOLIDATED BALANCE SHEET DATA
(Unaudited)
(In thousands)
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
Cash, cash equivalents and investments | $ | 326,458 | $ | 148,689 | ||||
Total notes receivable | $ | 90,815 | $ | 93,208 | ||||
Total assets | $ | 429,672 | $ | 279,966 | ||||
Total convertible notes payable | $ | 318,081 | $ | 309,952 | ||||
Total stockholders' equity (deficit) | $ | 52,887 | $ | (68,122 | ) | |||
PDL BIOPHARMA, INC.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW DATA
(Unaudited)
(In thousands)
Nine Months Ended | ||||||||
September 30, | ||||||||
2013 | 2012 | |||||||
Net income | $ | 203,438 | $ | 162,261 | ||||
Adjustments to reconcile net income to net cash provided by operating activities | 9,433 | 18,095 | ||||||
Changes in assets and liabilities | (3,191 | ) | (21,734 | ) | ||||
Net cash provided by operating activities | $ | 209,680 | $ | 158,622 | ||||
PDL BIOPHARMA, INC.
MIX OF EX-U.S. SALES AND EX-U.S.-BASED MANUFACTURING AND SALES
OF GENENTECH PRODUCTS
(Unaudited)
Three Months Ended | Nine Months Ended | |||||||||||
September 30, | September 30, | |||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||
Avastin | ||||||||||||
% Ex-U.S. Sold | 59 | % | 56 | % | 58 | % | 56 | % | ||||
% Ex-U.S.-based Manufactured and Sold | 38 | % | 29 | % | 45 | % | 25 | % | ||||
Herceptin | ||||||||||||
% Ex-U.S. Sold | 69 | % | 70 | % | 68 | % | 70 | % | ||||
% Ex-U.S.-based Manufactured and Sold | 38 | % | 37 | % | 38 | % | 38 | % | ||||
Kadcyla | ||||||||||||
% Ex-U.S. Sold | 1 | % | 0 | % | 1 | % | 0 | % | ||||
% Ex-U.S.-based Manufactured and Sold | 0 | % | 0 | % | 0 | % | 0 | % | ||||
Lucentis | ||||||||||||
% Ex-U.S. Sold | 63 | % | 65 | % | 65 | % | 62 | % | ||||
% Ex-U.S.-based Manufactured and Sold | 0 | % | 0 | % | 0 | % | 0 | % | ||||
Perjeta | ||||||||||||
% Ex-U.S. Sold | 26 | % | 0 | % | 16 | % | 0 | % | ||||
% Ex-U.S.-based Manufactured and Sold | 0 | % | 0 | % | 0 | % | 0 | % | ||||
Xolair | ||||||||||||
% Ex-U.S. Sold | 40 | % | 39 | % | 40 | % | 39 | % | ||||
% Ex-U.S.-based Manufactured and Sold | 40 | % | 39 | % | 40 | % | 39 | % | ||||
Exhibit 99.2
Exhibit 99.3
PDL BioPharma, Inc.
Q3-2013
November 6, 2013
Following are some of the key points regarding PDL’s third quarter 2013 financial and business results.
Net Income
• | Net income for the third quarter of 2013 was $56.2 million, or $0.36 per diluted share, as compared with net income of $48.6 million, or $0.32 per diluted share, in the same quarter of 2012. The increase in net income in the third quarter is primarily due to the 13 percent increase in royalty revenues. |
2013 Dividends
• | On January 30, 2013, PDL’s Board of Directors declared regular quarterly dividends of $0.15 per share of common stock, payable on March 12, June 12, September 12 and December 12 of 2013 to all stockholders who own shares of PDL on March 5, June 5, September 5 and December 5 of 2013, the record dates for each of the dividend payments, respectively. On September 12, 2013, PDL paid the third quarterly dividend to stockholders of record totaling $21.0 million using earnings generated in the third quarter of 2013. |
Four Recent Transactions
Debt Financing Provided to Direct Flow Medical, Inc.
• | On November 5, 2013, PDL entered into a debt financing transaction with Direct Flow Medical, Inc. (DFM), a transcatheter heart valve innovator focused on improving patient outcomes. PDL will provide a total of up to $50 million to DFM to be used to refinance its existing credit facility and fund the commercialization of its transcatheter aortic valve system used to treat aortic stenosis. An initial $35 million was provided at the close of the transaction, with the remaining $15 million to be funded upon the achievement of a specified revenue milestone. |
Debt Financing Provided to Durata Therapeutics, Inc.
• | On October 31, 2013, PDL entered into a debt financing transaction with Durata Therapeutics, Inc. , a pharmaceutical company focused on the development and commercialization of novel therapeutics for patients with infectious diseases and acute illnesses. PDL will provide Durata with up to $70 million of debt financing to be used to refinance its existing credit facility and fund the commercialization of dalbavancin, an intravenous antibiotic product candidate, for the treatment of patients with acute bacterial skin and skin structure infections, or ABSSSI, caused by Gram-positive bacteria, such as S. aureus, including methicillin-resistant and multi-drug resistant strains, and certain streptococcal species. An initial $25 million was provided at the close of the transaction, with the remaining $45 million to be made available pending regulatory approval of dalbavancin. |
Acquisition of Diabetes Royalty Rights and Milestones from Depomed, Inc.
• | On October 18, 2013, PDL acquired the rights to receive royalties and milestones payable on sales of Type 2 diabetes products licensed by Depomed in exchange for a $240.5 million cash payment. PDL will receive all royalty and milestone payments due under the agreements until it has received payments equal to two times the cash payment made to Depomed, after which all payments received will be shared evenly between PDL and Depomed. |
Debt Financing Provided to LENSAR, Inc.
• | On October 1, 2013, PDL entered into a credit agreement with LENSAR, Inc., a leader in the development and commercialization of a more intelligent solution for refractive laser-assisted cataract surgery. PDL will provide LENSAR with up to $60 million of debt financing to be used to refinance its existing credit facility and fund the commercialization of its currently marketed LENSAR Laser System. An initial $40 million was provided at close of the transaction, with the remaining $20 million to be funded upon the attainment of a specified sales milestone. |
Page 1
PDL BioPharma, Inc.
Q3-2013
November 6, 2013
Update on Litigation with Genentech/Roche
• | PDL and Genentech/Roche have mutually agreed to stay the arbitration proceeding and to delay the time for responses in the Nevada litigation to allow time for discussions to determine if a settlement of certain issues is possible. The parties may not reach agreement regarding settlement terms and PDL expects that it will renew its litigation efforts if settlement is unsuccessful. PDL will have no further comment on this matter. |
Term-loan of $75 Million
On October 28, 2013, PDL entered into a credit agreement with Royal Bank of Canada and Wells Fargo Bank. The Credit Agreement consists of a term loan of $75,000,000, with a term of one year. PDL took advantage of an opportunity to borrow money at a very low cost of capital. The interest rates per annum applicable to amounts outstanding under the term loan are, at the Company’s option, either (a) the base rate (as defined in the Credit Agreement) plus 1.00%, or (b) the Eurodollar rate (as defined in the Credit Agreement) plus 2.00% per annum. Interest payments under the Credit Agreement are due on the interest payment dates specified in the Credit Agreement.
Updates on Approved Royalty Bearing Products
Avastin® (bevacizumab): |
• | On October 17, 2013, Genentech/Roche reported that YTD worldwide sales increased by 13%. |
◦ | There was significant increase in sales in US in colorectal cancer due to label expansion through multiple lines of therapy. |
◦ | Strong sales in EU were driven by ovarian and colorectal cancers with the latter due to the label expansion through multiple lines of therapy. |
◦ | Steady growth in Japan in colorectal cancer, breast cancer and non-small cell lung cancer. |
• | On July 25, 2013, Genentech/Roche stated that it intends to file for approval for treatment of cervical cancer in US and EU in 2014. |
• | On December 12, 2012 and January 24, 2013, Genentech/Roche announced EU and US approval, respectively for second line metastatic colorectal cancer. |
Herceptin® (trastuzumab): |
• | On October 17, 2013, Genentech/Roche reported that YTD worldwide sales increased by 6%. |
• | On September 2, 2013, Genentech/Roche said European Commission approved a subcutaneous formulation of Herceptin to treat HER2-positive breast cancer. |
◦ | Subcutaneous administration takes 2-5 minutes instead of 30-90 minutes with the approved IV administration. |
Lucentis® (ranibizumab): |
• | On October 17, 2013, Genentech/Roche reported that YTD US sales increased by 13%. |
◦ | Less frequent than monthly dosing regimen is stabilizing market share in AMD. |
◦ | Increasing share in RVO and DME markets. |
• | On October 22, 2013, Novartis reported that 32Q13 ex-US sales were $581 million, down 1% from 3Q12. |
Tysabri® (natalizumab): |
• | On October 28, 2013, Biogen Idec reported that global sales in 3Q13 were $403 million, flat from a year ago. |
Xolair® (omalizumab): |
• | On October 17, 2013, Genentech/Roche reported that YTD US sales increased by 12%. |
• | On October 22, 2013, Novartis reported that 3Q13 ex-US sales were $151 million, up 13% from 3Q12. |
• | On June 26, 2013, Novartis announced that the second Phase 3 trial in 335 patients ages 12-75 with moderate to severe refractory chronic idiopathic urticaria (CIU) treated with 300 mg subcutaneous Xolair given every 4 weeks for 24 weeks as an add-on to antihistamine therapy met the primary efficacy endpoint with a similar incidence and severity of adverse events between treated and placebo patients. |
◦ | In February 2013, Novartis reported data from the first Phase 3 in 323 patients ages 12-75 with moderate to severe refractory CIU showing that 150 and 300 mg doses of Xolair as an add-on to antihistamine therapy each met the primary efficacy endpoint. |
• | On July 17, 2013, Novartis disclosed that it had filed for EU approval for CIU. |
Page 2
PDL BioPharma, Inc.
Q3-2013
November 6, 2013
• | On October 10, 2013, Genentech/Roche announced that the FDA had accepted for filing the US approval application for CIU with a PDUFA date in second quarter of 2014. |
Actemra® (tocilizumab): |
• | On October 17, 2013, Genentech/Roche reported that YTD worldwide sales increased by 33%. |
◦ | Sales growth was driven by monotherapy use with US being the biggest contributor to growth. |
• | On October 21, 2013, Genentech/Roche announced approval of the subcutaneous formulation. |
• | On April 30, 2013, Genentech/Roche announced that FDA had approved its use for the treatment of a rare, debilitating condition in children known as polyarticular juvenile idiopathic arthritis. |
Perjeta™ (pertuzumab): |
• | On October 17, 2013, Genentech/Roche reported YTD sales of CHF 186 million. |
• | Genentech/Roche announced EMA approval in March 2013. |
• | On September 30, 2013, Genentech/Roche announced that FDA had granted accelerated approval for the neo-adjuvant indication. |
Kadcyla™ (TDM-1 or ado-trastuzumab emtansine): |
• | On October 17, 2013, Genentech/Roche reported YTD sales of CHF 156 million. |
◦ | On February 22, 2013, Genentech/Roche announced that FDA approval for second line treatment of HER2+ metastatic breast cancer and first line treatment for patients who relapse within 6 months following adjuvant therapy. |
• | On September 20, 2013, EU's Committee for Medicinal Products for Human Use recommended approval for the treatment of adults with HER2-positive, inoperable locally advanced or metastatic breast cancer who previously received trastuzumab and a taxane, separately or in combination. |
• | Also on September 20, 2013, Japan approved it for the same indication. |
• | On July 25, 2013, Genentech/Roche announced that a Phase 3 trial comparing Kadcyla to the physician's choice of treatment in patients with HER2-positive breast cancer who have already been treated with a HER2-targeted therapy, met its co-primary endpoint of progression free survival. The other endpoint is overall survival, but these data are not yet mature. |
Gazyva™ (Obinutuzumab or GA101): |
• | On November 1, 2013, Genentech/Roche announced that Gazyva™ (obinutuzumab), formerly known as GA101, became the first therapy approved through the FDA’s breakthrough therapy designation, indicated in combination with chlorambucil to treat previously untreated chronic lymphocytic leukemia (CLL). Genentech/Roche expect Gazyva to be on the market in the United States by mid-November. |
• | On May 15, 2013, Genentech/Roche announced approval applications for the treatment of chronic lymphocytic leukemia (CLL) had been submitted to regulatory authorities including the European Medicines Association (EMA) and the FDA. |
◦ | Also announced, FDA designated it as a breakthrough therapy for CLL. |
◦ | Previously, Genentech/Roche announced that results from Stage 1 of a Phase 3 trial showed CLL patients treated with obinutuzumab + chlorambucil had a progression free survival (PFS) of 23 months compared to 10.9 months for patients treated with chlorambucil only. |
• | On July 2, 2013, Genentech/Roche announced FDA accepted their approval application and it had been granted priority review by FDA with a PDUFA date of December 20, 2013. |
• | On July 23, 2013, Genentech/Roche announced that results from planned interim analysis of Stage 2 of same Phase 3 trial showed CLL patients treated with obinutuzumab + chlorambucil lived significantly longer without disease worsening (PFS) than patients receiving Rituxan + chlorambucil. |
• | While the differences in PFS will not be disclosed until ASH in early December 2013, Genentech/Roche stated that the endpoint was achieved sooner than the target date of 2014 because of the magnitude of the difference between the two arms in Stage 2. |
Page 3
PDL BioPharma, Inc.
Q3-2013
November 6, 2013
Forward-looking Statements
This document contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Each of these forward-looking statements involves risks and uncertainties. Actual results may differ materially from those, express or implied, in these forward-looking statements. Important factors that could impair the value of the Company's royalty assets, restrict or impede the ability of the Company to invest in new income generating assets and limit the Company's ability to pay dividends are disclosed in the risk factors contained in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission. All forward-looking statements are expressly qualified in their entirety by such factors. We do not undertake any duty to update any forward-looking statement except as required by law.
Page 4
PDL BioPharma, Inc.
Q3-2013
November 6, 2013
Royalty Revenue by Product ($ in 000's) * | ||||||||||
Avastin | Q1 | Q2 | Q3 | Q4 | Total | |||||
2013 | 33,234 | 46,720 | 32,224 | — | 112,177 | |||||
2012 | 23,215 | 41,670 | 25,955 | 30,041 | 120,882 | |||||
2011 | 22,283 | 41,967 | 23,870 | 22,886 | 111,006 | |||||
2010 | 16,870 | 44,765 | 29,989 | 24,922 | 116,547 | |||||
2009 | 13,605 | 35,161 | 21,060 | 15,141 | 84,966 | |||||
2008 | 9,957 | 30,480 | 19,574 | 12,394 | 72,405 | |||||
2007 | 8,990 | 21,842 | 17,478 | 9,549 | 57,859 | |||||
2006 | 10,438 | 15,572 | 15,405 | 12,536 | 53,952 | |||||
Herceptin | Q1 | Q2 | Q3 | Q4 | Total | |||||
2013 | 30,287 | 47,353 | 30,961 | — | 108,602 | |||||
2012 | 25,702 | 44,628 | 30,433 | 28,307 | 129,070 | |||||
2011 | 25,089 | 42,209 | 31,933 | 21,812 | 121,042 | |||||
2010 | 23,402 | 38,555 | 27,952 | 25,441 | 115,350 | |||||
2009 | 16,003 | 32,331 | 26,830 | 18,615 | 93,779 | |||||
2008 | 14,092 | 34,383 | 28,122 | 20,282 | 96,880 | |||||
2007 | 19,035 | 28,188 | 22,582 | 14,802 | 84,608 | |||||
2006 | 15,142 | 19,716 | 21,557 | 20,354 | 76,769 | |||||
Lucentis | Q1 | Q2 | Q3 | Q4 | Total | |||||
2013 | 12,032 | 30,066 | 13,536 | — | 55,633 | |||||
2012 | 10,791 | 27,938 | 12,552 | 11,097 | 62,377 | |||||
2011 | 8,878 | 24,313 | 12,157 | 10,750 | 56,099 | |||||
2010 | 7,220 | 19,091 | 10,841 | 8,047 | 45,198 | |||||
2009 | 4,621 | 12,863 | 8,123 | 6,152 | 31,759 | |||||
2008 | 3,636 | 11,060 | 7,631 | 4,549 | 26,876 | |||||
2007 | 2,931 | 6,543 | 6,579 | 3,517 | 19,570 | |||||
2006 | — | — | 289 | 3,335 | 3,624 | |||||
Xolair | Q1 | Q2 | Q3 | Q4 | Total | |||||
2013 | 5,930 | 10,025 | 7,334 | — | 23,288 | |||||
2012 | 5,447 | 8,609 | 6,504 | 6,145 | 26,705 | |||||
2011 | 4,590 | 7,621 | 5,916 | 5,823 | 23,949 | |||||
2010 | 3,723 | 6,386 | 4,980 | 4,652 | 19,741 | |||||
2009 | 2,665 | 5,082 | 4,085 | 3,722 | 15,553 | |||||
2008 | 1,488 | 4,866 | 3,569 | 2,927 | 12,850 | |||||
2007 | 1,684 | 3,942 | 3,332 | 2,184 | 11,142 | |||||
2006 | 2,263 | 2,969 | 3,041 | 2,495 | 10,768 | |||||
Perjeta | Q1 | Q2 | Q3 | Q4 | Total | |||||
2013 | 340 | 1,414 | 748 | — | 2,502 | |||||
2012 | — | — | 58 | 250 | 308 | |||||
2011 | — | — | — | — | — | |||||
2010 | — | — | — | — | — | |||||
2009 | — | — | — | — | — | |||||
2008 | — | — | — | — | — | |||||
2007 | — | — | — | — | — | |||||
2006 | — | — | — | — | — | |||||
Kadcyla | Q1 | Q2 | Q3 | Q4 | Total | |||||
2013 | — | 551 | 830 | — | 1,381 | |||||
2012 | — | — | — | — | — | |||||
2011 | — | — | — | — | — | |||||
2010 | — | — | — | — | — | |||||
2009 | — | — | — | — | — | |||||
2008 | — | — | — | — | — | |||||
2007 | — | — | — | — | — | |||||
2006 | — | — | — | — | — | |||||
Tysabri | Q1 | Q2 | Q3 | Q4 | Total | |||||
2013 | 12,965 | 13,616 | 11,622 | — | 38,203 | |||||
2012 | 11,233 | 12,202 | 11,749 | 12,255 | 47,439 | |||||
2011 | 9,891 | 10,796 | 11,588 | 11,450 | 43,725 | |||||
2010 | 8,791 | 8,788 | 8,735 | 9,440 | 35,754 | |||||
2009 | 6,656 | 7,050 | 7,642 | 8,564 | 29,912 | |||||
2008 | 3,883 | 5,042 | 5,949 | 6,992 | 21,866 | |||||
2007 | 839 | 1,611 | 2,084 | 2,836 | 7,370 | |||||
2006 | — | — | — | 237 | 237 | |||||
Actemra | Q1 | Q2 | Q3 | Q4 | Total | |||||
2013 | 2,631 | 2,816 | 2,939 | — | 8,386 | |||||
2012 | 1,705 | 2,074 | 2,145 | 2,462 | 8,385 | |||||
2011 | 913 | 1,136 | 1,401 | 1,460 | 4,910 | |||||
2010 | 1,587 | 237 | 315 | 688 | 2,827 | |||||
2009 | 585 | 537 | 909 | 1,197 | 3,228 | |||||
2008 | 44 | — | 146 | 369 | 559 | |||||
2007 | 32 | — | — | 17 | 49 | |||||
2006 | — | — | — | — | — | |||||
* As reported to PDL by its licensees | ||||||||||
Totals may not sum due to rounding | ||||||||||
Page 5
PDL BioPharma, Inc.
Q3-2013
November 6, 2013
Reported Net Sales Revenue by Product ($ in 000's) * | ||||||||||
Avastin | Q1 | Q2 | Q3 | Q4 | Total | |||||
2013 | 1,653,108 | 1,694,678 | 1,746,135 | — | 5,093,921 | |||||
2012 | 1,502,757 | 1,573,727 | 1,551,327 | 1,662,977 | 6,290,788 | |||||
2011 | 1,597,461 | 1,582,705 | 1,581,095 | 1,469,994 | 6,231,255 | |||||
2010 | 1,506,788 | 1,596,892 | 1,594,707 | 1,646,218 | 6,344,605 | |||||
2009 | 1,345,487 | 1,295,536 | 1,439,730 | 1,514,053 | 5,594,806 | |||||
2008 | 980,715 | 1,084,930 | 1,180,427 | 1,239,382 | 4,485,454 | |||||
2007 | 678,068 | 746,587 | 797,013 | 875,084 | 3,096,752 | |||||
2006 | 439,318 | 516,052 | 570,551 | 592,897 | 2,118,817 | |||||
Herceptin | Q1 | Q2 | Q3 | Q4 | Total | |||||
2013 | 1,681,574 | 1,744,145 | 1,681,860 | — | 5,107,579 | |||||
2012 | 1,515,255 | 1,625,313 | 1,663,695 | 1,650,495 | 6,454,759 | |||||
2011 | 1,391,568 | 1,559,975 | 1,642,898 | 1,432,771 | 6,027,211 | |||||
2010 | 1,270,846 | 1,349,512 | 1,300,934 | 1,409,310 | 5,330,602 | |||||
2009 | 1,210,268 | 1,133,993 | 1,226,435 | 1,278,626 | 4,849,323 | |||||
2008 | 1,105,426 | 1,195,215 | 1,211,982 | 1,186,806 | 4,699,428 | |||||
2007 | 891,761 | 949,556 | 979,602 | 1,015,033 | 3,835,952 | |||||
2006 | 529,585 | 659,719 | 761,099 | 803,576 | 2,753,979 | |||||
Lucentis | Q1 | Q2 | Q3 | Q4 | Total | |||||
2013 | 1,203,179 | 1,171,423 | 1,200,791 | — | 3,575,394 | |||||
2012 | 1,079,092 | 1,086,543 | 1,097,541 | 1,109,695 | 4,372,871 | |||||
2011 | 887,757 | 943,418 | 1,052,809 | 1,075,015 | 3,958,999 | |||||
2010 | 721,967 | 698,890 | 745,376 | 804,684 | 2,970,917 | |||||
2009 | 462,103 | 469,736 | 555,296 | 615,212 | 2,102,347 | |||||
2008 | 363,615 | 393,682 | 460,167 | 454,922 | 1,672,386 | |||||
2007 | 224,820 | 219,579 | 299,995 | 322,300 | 1,066,695 | |||||
2006 | — | — | 10,689 | 157,742 | 168,431 | |||||
Xolair | Q1 | Q2 | Q3 | Q4 | Total | |||||
2013 | 341,309 | 365,778 | 391,900 | — | 1,098,987 | |||||
2012 | 310,234 | 314,638 | 347,796 | 340,431 | 1,313,100 | |||||
2011 | 267,754 | 277,642 | 310,874 | 314,911 | 1,171,182 | |||||
2010 | 228,859 | 225,878 | 251,055 | 263,389 | 969,179 | |||||
2009 | 184,669 | 181,086 | 211,006 | 219,693 | 796,454 | |||||
2008 | 137,875 | 169,521 | 177,179 | 183,753 | 668,329 | |||||
2007 | 129,172 | 130,700 | 144,250 | 147,754 | 551,876 | |||||
2006 | 95,241 | 99,354 | 112,608 | 118,002 | 425,204 | |||||
Perjeta | Q1 | Q2 | Q3 | Q4 | Total | |||||
2013 | 34,008 | 55,076 | 66,353 | — | 155,437 | |||||
2012 | — | — | 5,080 | 25,000 | 30,079 | |||||
2011 | — | — | — | — | — | |||||
2010 | — | — | — | — | — | |||||
2009 | — | — | — | — | — | |||||
2008 | — | — | — | — | — | |||||
2007 | — | — | — | — | — | |||||
2006 | — | — | — | — | — | |||||
Kadcyla | Q1 | Q2 | Q3 | Q4 | Total | |||||
2013 | — | 21,459 | 73,626 | — | 95,085 | |||||
2012 | — | — | — | — | — | |||||
2011 | — | — | — | — | — | |||||
2010 | — | — | — | — | — | |||||
2009 | — | — | — | — | — | |||||
2008 | — | — | — | — | — | |||||
2007 | — | — | — | — | — | |||||
2006 | — | — | — | — | — | |||||
Tysabri | Q1 | Q2 | Q3 | Q4 | Total | |||||
2013 | 434,677 | 451,358 | 387,407 | — | 1,273,442 | |||||
2012 | 374,430 | 401,743 | 391,623 | 408,711 | 1,576,508 | |||||
2011 | 329,696 | 356,876 | 388,758 | 381,618 | 1,456,948 | |||||
2010 | 293,047 | 287,925 | 293,664 | 316,657 | 1,191,292 | |||||
2009 | 221,854 | 229,993 | 257,240 | 285,481 | 994,569 | |||||
2008 | 129,430 | 163,076 | 200,783 | 233,070 | 726,359 | |||||
2007 | 30,468 | 48,715 | 71,972 | 94,521 | 245,675 | |||||
2006 | — | — | — | 7,890 | 7,890 | |||||
Actemra | Q1 | Q2 | Q3 | Q4 | Total | |||||
2013 | 87,703 | 91,374 | 97,961 | — | 277,038 | |||||
2012 | 56,662 | 66,624 | 71,505 | 82,053 | 276,843 | |||||
2011 | 30,433 | 35,370 | 46,709 | 48,671 | 161,183 | |||||
2010 | 52,908 | 5,405 | 10,493 | 22,919 | 91,725 | |||||
2009 | 19,504 | 17,920 | 30,313 | 39,888 | 107,625 | |||||
2008 | 1,452 | 1,377 | 5,981 | 12,305 | 21,115 | |||||
2007 | — | — | — | 1,137 | 1,137 | |||||
2006 | — | — | — | — | — | |||||
* As reported to PDL by its licensee. Dates in above charts | ||||||||||
reflect when PDL receives royalties on sales. Sales occurred | ||||||||||
in the quarter prior to the dates in the above charts. | ||||||||||
Totals may not sum due to rounding | ||||||||||
Page 6
PDL BioPharma, Inc.
Q3-2013
November 6, 2013
Manufacturing Location & Sales - Genentech / Roche & Novartis ($ in 000's) * | ||||||||||||
Avastin Sales | 2012 - Q2 | 2012 - Q3 | 2012 - Q4 | 2013 - Q1 | 2013 - Q2 | 2013 - Q3 | ||||||
US Made & Sold | 724,483 | 679,914 | 710,501 | 664,109 | 750,491 | 716,337 | ||||||
US Made & ex-US Sold | 532,979 | 428,976 | 281,905 | 161,369 | 165,651 | 360,177 | ||||||
ex-US Made & Sold | 316,265 | 442,437 | 670,572 | 827,629 | 778,536 | 669,621 | ||||||
Total | 1,573,727 | 1,551,327 | 1,662,977 | 1,653,108 | 1,694,678 | 1,746,135 | ||||||
US Made & Sold | 46 | % | 44 | % | 43 | % | 40 | % | 44 | % | 41 | % |
US Made & ex-US Sold | 34 | % | 28 | % | 17 | % | 10 | % | 10 | % | 21 | % |
ex-US Made & Sold | 20 | % | 29 | % | 40 | % | 50 | % | 46 | % | 38 | % |
Herceptin Sales | 2012 - Q2 | 2012 - Q3 | 2012 - Q4 | 2013 - Q1 | 2013 - Q2 | 2013 - Q3 | ||||||
US Made & Sold | 497,109 | 503,612 | 515,790 | 514,113 | 583,677 | 518,790 | ||||||
US Made & ex-US Sold | 466,477 | 545,625 | 552,127 | 486,400 | 563,243 | 522,159 | ||||||
ex-US Made & Sold | 661,727 | 614,459 | 582,578 | 681,060 | 597,225 | 640,911 | ||||||
Total | 1,625,313 | 1,663,695 | 1,650,495 | 1,681,574 | 1,744,145 | 1,681,860 | ||||||
US Made & Sold | 31 | % | 30 | % | 31 | % | 31 | % | 33 | % | 31 | % |
US Made & ex-US Sold | 29 | % | 33 | % | 33 | % | 29 | % | 32 | % | 31 | % |
ex-US Made & Sold | 41 | % | 37 | % | 35 | % | 41 | % | 34 | % | 38 | % |
Lucentis Sales | 2012 - Q2 | 2012 - Q3 | 2012 - Q4 | 2013 - Q1 | 2013 - Q2 | 2013 - Q3 | ||||||
US Made & Sold | 412,131 | 385,746 | 381,592 | 392,207 | 419,030 | 449,834 | ||||||
US Made & ex-US Sold | 674,411 | 711,795 | 728,103 | 810,972 | 752,393 | 750,958 | ||||||
ex-US Made & Sold | — | — | — | — | — | — | ||||||
Total | 1,086,543 | 1,097,541 | 1,109,695 | 1,203,179 | 1,171,423 | 1,200,791 | ||||||
US Made & Sold | 38 | % | 35 | % | 34 | % | 33 | % | 36 | % | 37 | % |
US Made & ex-US Sold | 62 | % | 65 | % | 66 | % | 67 | % | 64 | % | 63 | % |
ex-US Made & Sold | — | % | — | % | — | % | — | % | — | % | — | % |
Xolair Sales | 2012 - Q2 | 2012 - Q3 | 2012 - Q4 | 2013 - Q1 | 2013 - Q2 | 2013 - Q3 | ||||||
US Made & Sold | 193,600 | 211,702 | 210,892 | 207,976 | 218,860 | 236,180 | ||||||
US Made & ex-US Sold | — | — | — | — | — | — | ||||||
ex-US Made & Sold | 121,039 | 136,094 | 129,540 | 133,333 | 146,918 | 155,720 | ||||||
Total | 314,638 | 347,796 | 340,431 | 341,309 | 365,778 | 391,900 | ||||||
US Made & Sold | 62 | % | 61 | % | 62 | % | 61 | % | 60 | % | 60 | % |
US Made & ex-US Sold | — | % | — | % | — | % | — | % | — | % | — | % |
ex-US Made & Sold | 38 | % | 39 | % | 38 | % | 39 | % | 40 | % | 40 | % |
Perjeta Sales | 2012 - Q2 | 2012 - Q3 | 2012 - Q4 | 2013 - Q1 | 2013 - Q2 | 2013 - Q3 | ||||||
US Made & Sold | — | 5,080 | 24,571 | 32,377 | 48,979 | 49,111 | ||||||
US Made & ex-US Sold | — | — | 428 | 1,632 | 6,096 | 17,242 | ||||||
ex-US Made & Sold | — | — | — | — | — | — | ||||||
Total | — | 5,080 | 25,000 | 34,008 | 55,076 | 66,353 | ||||||
US Made & Sold | — | % | 100 | % | 98 | % | 95 | % | 89 | % | 74 | % |
US Made & ex-US Sold | — | % | — | % | 2 | % | 5 | % | 11 | % | 26 | % |
ex-US Made & Sold | — | % | — | % | — | % | — | % | — | % | — | % |
Kadcyla Sales | 2012 - Q2 | 2012 - Q3 | 2012 - Q4 | 2013 - Q1 | 2013 - Q2 | 2013 - Q3 | ||||||
US Made & Sold | — | — | — | — | 21,459 | 72,887 | ||||||
US Made & ex-US Sold | — | — | — | — | — | 739 | ||||||
ex-US Made & Sold | — | — | — | — | — | — | ||||||
Total | — | — | — | — | 21,459 | 73,626 | ||||||
US Made & Sold | — | % | — | % | — | % | — | % | 100 | % | 99 | % |
US Made & ex-US Sold | — | % | — | % | — | % | — | % | — | % | 1 | % |
ex-US Made & Sold | — | % | — | % | — | % | — | % | — | % | — | % |
Total Sales | 2012 - Q2 | 2012 - Q3 | 2012 - Q4 | 2013 - Q1 | 2013 - Q2 | 2013 - Q3 | ||||||
US Made & Sold | 1,827,323 | 1,786,053 | 1,843,345 | 1,810,783 | 2,042,496 | 2,043,139 | ||||||
US Made & ex-US Sold | 1,673,867 | 1,686,395 | 1,562,564 | 1,460,373 | 1,487,383 | 1,651,276 | ||||||
ex-US Made & Sold | 1,099,031 | 1,192,990 | 1,382,690 | 1,642,023 | 1,522,679 | 1,466,252 | ||||||
Total | 4,600,221 | 4,665,438 | 4,788,598 | 4,913,178 | 5,052,559 | 5,160,667 | ||||||
US Made & Sold | 40 | % | 38 | % | 38 | % | 37 | % | 40 | % | 40 | % |
US Made & ex-US Sold | 36 | % | 36 | % | 33 | % | 30 | % | 29 | % | 32 | % |
ex-US Made & Sold | 24 | % | 26 | % | 29 | % | 33 | % | 30 | % | 28 | % |
* As reported to PDL by its licensee. Dates in above charts | ||||||||||||
reflect when PDL receives royalties on sales. Sales occurred | ||||||||||||
in the quarter prior to the dates in the above charts. | ||||||||||||
Totals may not sum due to rounding | ||||||||||||
Page 7