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•	Total revenues of $45.4 million for the three months ended March 31, 2017.

•	GAAP diluted EPS of $0.04 for the three months ended March 31, 2017.

•	GAAP net income attributable to PDL’s shareholders of $7.2 million for the three months ended March 31, 2017.

•	Non-GAAP net income attributable to PDL’s shareholders of $13.2 million for the three months ended March 31, 2017. A full reconciliation of all components of the GAAP to non-GAAP financial results can be found in Table 4 at the end of the release.

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In April 2017, the Company entered into a settlement agreement with Merck to resolve the patent infringement lawsuit between the parties pending in the U.S. District Court for the District of New Jersey related to Merck’s Keytruda humanized antibody product. Under the terms of the agreement, Merck will pay the Company a one-time, lump-sum payment of $19.5 million, and the Company will grant Merck a fully paid-up, royalty-free, non-exclusive license to certain of the Company’s Queen et al. patent rights for use in connection with Keytruda as well as a covenant not to sue Merck for any royalties regarding Keytruda. In addition, the parties agreed to dismiss all claims in the relevant legal proceedings. The payment of $19.5 million is expected to be recognized as license revenue for the second quarter ending June 30, 2017.

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On March 1, 2017, the Company announced that its board of directors has authorized the repurchase of up to $30.0 million of the Company’s common stock through March 2018. As of March 31, 2017, the Company has repurchased a total of 3.9 million shares of its common stock in open market transactions under the share repurchase program for an aggregate purchase price of $8.5 million, or an average cost of $2.16 per share. From April 1, 2017 to April 28, 2017, the Company repurchased 3.7 million shares of its common stock under the share repurchase program at a weighted average price of $2.16 per share for a total of $7.9 million. Since the inception of the share repurchase program in March 2017, the Company has repurchased 7.6 million shares of its common stock for a total of $16.4 million.

•	In April 2017, PDL received a royalty payment from Valeant Pharmaceuticals International, Inc. in the amount of $8.5 million for royalties earned on sales of Glumetza for the month of March. The monthly royalty payment was a result of lower reported gross to net deductions. This payment will be recorded in the second quarter of 2017.

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•	Total revenues of $45.4 million for the three months ended March 31, 2017 included:

◦	Royalties from PDL’s licensees to the Queen et al. patents of $14.2 million, which consisted of royalties earned on sales of Tysabri® under a license agreement;

◦	Net royalty payments from acquired royalty rights and a change in fair value of the royalty rights assets of $13.1 million, which consisted of the change in estimated fair value of our royalty right assets, primarily related to the Depomed, Inc., University of Michigan, ARIAD and AcelRx Pharmaceuticals, Inc.;

◦	Interest revenue from notes receivable financings to kaléo and CareView Communications of $5.5 million; and

◦	Product revenues of $12.6 million from sales of Tekturna® and Tekturna HCT® in the United States of $9.7 million and Rasilez® and Rasilez HCT® in the rest of the world (collectively, the Noden Products) of $2.9 million.

•	Total revenues decreased by 56 percent for the three months ended March 31, 2017, when compared to the same period in 2016.

◦	The decrease in royalties from PDL’s licensees to the Queen et al. patents is due to the period ended March 31, 2016 being the last quarter in which PDL received royalties from Genentech, Inc.

◦	The increase in royalty rights - change in fair value was primarily due to the prior year decrease in fair value of the Depomed, Inc. royalty asset.

◦	PDL received $13.5 million in net cash royalties from its royalty rights in the first quarter of 2017, compared to $17.2 million for the same period of 2016.

◦	The decrease in interest revenues was primarily due to the early repayment of the Paradigm Spine, LLC note receivable investment and the non-accrual status of the LENSAR, Inc. note receivable investment.

◦	Product revenues were derived from sales of the Noden Products, which PDL did not begin to recognize until the third quarter of 2016.

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Operating expenses were $26.9 million for the three months ended March 31, 2017, compared to $9.8 million for the same period of 2016. The increase in operating expenses for the three months ended March 31, 2017, as compared to the same period in 2016, was primarily a result of the $15.5 million in expenses related to the Noden operations, including $7.5 million of non-cash intangible asset amortization and a change in fair value of contingent consideration.

•	PDL had cash, cash equivalents, and short-term investments of $409.3 million at March 31, 2017, compared to $242.1 million at December 31, 2016. The current cash balance includes a $111.3 million payment from ARIAD as a result of PDL’s exercise of its put option under the ARIAD royalty agreement.

•	Net cash provided by operating activities in the three months ended March 31, 2017 was $45.8 million, compared with $92.5 million in the same period in 2016.

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•	Total revenues of $45.4 million for the three months ended March 31, 2017.

•	GAAP diluted EPS of $0.04 for the three months ended March 31, 2017.

•	GAAP net income attributable to PDL’s shareholders of $7.2 million for the three months ended March 31, 2017.

•	Non-GAAP net income attributable to PDL’s shareholders of $13.2 million for the three months ended March 31, 2017.

•	Continue to receive royalties on Tysabri from Biogen with respect to sales of the licensed product manufactured prior to patent expiry in jurisdictions providing patent protection licenses.

•	PDL received a royalty payment for the first quarter of 2017 in the amount of $14.2 million for royalties earned on sales of Tysabri. The duration of this royalty payment is based on the sales of product manufactured prior to patent expiry, the amount of which is uncertain.

•	In late April, we entered into a settlement agreement with certain subsidiaries of Merck to resolve the pending patent infringement lawsuit related to Merck’s manufacture or sale of Keytruda humanized antibody product prior to the expiration of the Queen et al patents at the end of 2014.

•	Under the terms of the agreement, Merck will pay us a one time, lump-sum payment of $19.5 million in exchange for our granting them a fully paid-up, royalty free, non-exclusive license to certain of our Queen et al. patent rights for use in connection with Keytruda as well as a covenant not to sue them for any royalties regarding Keytruda.

•	Noden US is commercializing Tekturna® and Tekturna HCT® in the United States and Noden Pharma DAC, an Irish based company, will assume commercialization responsibilities for Rasilez® and Rasilez HCT® in the rest of the world in the second half of 2017. The products are indicated for the treatment of hypertension.

•	PDL is currently a 98.8% owner of Noden and holds three of five board seats.

•	Noden and PDL are evaluating additional specialty pharma products in the form of optimized, established medicines, to acquire for Noden.

•	Noden net revenue for the quarter ended March 31, 2017 was $12.6 million, with $9.7 million in US revenue and $2.9 million in the rest of world.

◦	Gross margin on the US revenue in the 1st quarter were approximately 74 percent.

◦	The $2.9 million of revenue for the ex-U.S. is net of cost of goods and a fee to Novartis through its transition services agreement and will continue until marketing authorizations have been transferred.

•	Novartis and Noden Pharma DAC are working to transfer the marketing authorizations from Novartis companies to Noden Pharma DAC or to deregister the product.

◦	These transfers (specifically EU, Switzerland, Canada and Japan) have been delayed per our original plan and are now expected to take place in the second half of this year.

◦	Novartis has begun deregistering the product in countries in which the product has limited sales volumes and low operating margins.

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•	To date (through March 31, 2017), we have received cash royalty payments of $221.5 million of the $240.5 million investment.

•	Glumetza royalty: 50% of net sales less COGS until the termination of the Depomed agreement which we estimate could be late 2029. PDL is auditing Valeant.

•	Recent product approvals, Jentadueto XR, Invokamet XR and Synjardy XR have yielded $17 million in milestones in 2016 and started generating royalties to PDL.

•	Low to mid-single digit royalties to PDL on new product approvals expected to continue to 2023 for Invokamet XR and 2026 for Jentadueto XR and Synjardy XR.

•	In April 2017, PDL received a royalty payment from Valeant Pharmaceuticals International, Inc. in the amount of $8.5 million for royalties earned on sales of Glumetza for the month of March. The monthly royalty payment was a result of lower reported gross to net deductions. This payment will be recorded in the second quarter of 2017.

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•	Ariad acquired by Takeda in February 2017.

•	PDL exercised its put option and was repaid $111.3 million which is 1.2 times the $100 million advanced to Ariad less any sums already repaid. The annualized internal rate of return on this investment was 17.5%.

•	The $111.3 million payment was received on March 30, 2017 and was recognized in our Q1 financials.

•	PDL acquired 75% of the royalty that Grünenthal pays to AcelRx for rights to commercialize Zalviso in the EU, Switzerland and Australia.

•	PDL also receives 80% of the first four commercial milestones.

•	Zalviso was approved in September 2015 and was launched in the second quarter of 2016. Full EU launch is occurring later than anticipated.

•	Net selling price is higher than expected at 95-118 Euros per treatment.

•	In NY court action commenced by PDL to collect from related entities who are guarantors of the loan, the judge ruled in favor of PDL and has appointed a magistrate to determine PDL’s damages. Wellstat appealed the ruling, and their appeal was heard in January 2017.

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In February 2017, the appellate division of the NY court reversed on procedural grounds the portion of the decision granting PDL summary judgment, but affirmed the portion of the decision denying the Wellstat Diagnostics guarantor defendants’ motion for summary judgment in which they sought a determination that the guarantees had been released. As a result, the litigation has been returned to the Supreme Court of New York to proceed on PDL’s claims as a plenary action.

•	PDL commenced a non-judicial foreclosure process to collect on the sale of certain Virginia real estate assets owned by the guarantors of the loan as well as initiating a UCC Article 9 sale of certain intellectual property assets of the guarantors..

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In March 2017, the Wellstat Diagnostics Guarantors filed an order to show cause with the New York Supreme Court to enjoin the Company’s sale of the real estate or enforcing its security interests in the Wellstat Diagnostics Guarantors’ intellectual property during the pendency of any action involving the guarantees at issue. The Company is awaiting a hearing on the motions of the Wellstat Diagnostics Guarantors.

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•	PDL initiated foreclosure proceedings in January 2017 which resulted in obtaining ownership of certain of the DFM assets through a wholly-owned subsidiary, DFM, LLC.

•	PDL wrote off $51.1 million of assets against ordinary income in Q4 2016.

•	In Q1 2017, PDL monetized $7.9 million of those assets. PDL is in the process of monetizing the ex-China assets of DFM. The amount of which recovery, if any, is unknown at this time.

•	As of March 31, 2017 remaining foreclosed assets are recorded as assets held for sale with a carrying value of $2.1 million.

•	Alphaeon is divesting all of its ophthalmology business, including LENSAR.

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In December 2016, LENSAR Inc. re-acquired the assets it had sold to Alphaeon and assumed the obligations under the PDL credit agreement. Also in December, LENSAR Inc., with the support of PDL, filed for bankruptcy under Chapter 11. LENSAR has filed a plan of reorganization with our support under which, subject to bankruptcy court approval, it is expected that LENSAR will issue equity securities to us in exchange for a portion of our claims in the Chapter 11 case and will become one of our operating subsidiaries.

•	In January 2017, the bankruptcy court approved a debtor-in-possession credit agreement whereby PDL agreed to provide up to approximately $2.8 million to LENSAR so that it can continue to operate its business during the remainder of the bankruptcy proceeding.

•	On April 26, 2017 the bankruptcy court approved the plan of reorganization, and the Company expects that LENSAR will emerge from the Chapter 11 case on or about May 11, 2017.

•	Despite Auvi-Q being voluntarily pulled from market and Sanofi returning the product right to kaléo, kaléo has made all required interest payments in full and on time to date.

•	Auvi-Q returned to the market in February 2017 and third party reports suggest strong sales.

•	Evzio sales have been much stronger than projected so far. This is secondary source of repayment to PDL.

•	In the first quarter of 2017, PDL recognized $4.7 million in interest revenue from the kaléo note.

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