ex99_2.htm

Forward Looking Statements

This presentation contains forward-looking statements, including PDL’s expectations with respect to its future
royalty revenues, expenses, net income, and cash provided by operating activities.

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. Factors that may cause differences between
current expectations and actual results include, but are not limited to, the following:

▪ The expected rate of growth in royalty-bearing product sales by PDL’s existing licensees;

• The relative mix of royalty-bearing Genentech products manufactured and sold outside the U.S. versus manufactured or
sold in the U.S.;

• The ability of PDL’s licensees to receive regulatory approvals to market and launch new royalty-bearing products and
whether such products, if launched, will be commercially successful;

• Changes in any of the other assumptions on which PDL’s projected royalty revenues are based;

• Changes in foreign currency rates;

• Positive or negative results in PDL’s attempt to acquire royalty-related assets;

• The outcome of pending litigation or disputes, including PDL’s current dispute with Genentech related to ex-U.S. sales of
Genentech licensed products; and

• The failure of licensees to comply with existing license agreements, including any failure to pay royalties due.

Other factors that may cause PDL’s actual results to differ materially from those expressed or implied in the
forward-looking statements in this presentation are discussed in PDL’s filings with the SEC, including the "Risk
Factors" sections of its annual and quarterly reports filed with the SEC. Copies of PDL’s filings with the SEC may
be obtained at the "Investors" section of PDL’s website at www.pdl.com. PDL expressly disclaims any obligation
or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein
to reflect any change in PDL’s expectations with regard thereto or any change in events, conditions or
circumstances on which any such statements are based for any reason, except as required by law, even as new
information becomes available or other events occur in the future. All forward-looking statements in this
presentation are qualified in their entirety by this cautionary statement.

Company Overview

• PDL pioneered the humanization of monoclonal antibodies
which enabled the discovery of a new generation of targeted
treatments for cancer and immunologic diseases

• PDL’s primary assets are its antibody humanization patents
and royalty assets which consist of its Queen et al. patents
and license agreements

• Licensees consist of large biotechnology and
pharmaceutical companies including Roche/Genentech/
Novartis, Elan/BiogenIdec, Pfizer/Wyeth/J&J and Chugai

Antibody Humanization Technology

• Antibodies are naturally produced by humans to fight
foreign substances, such as bacteria and viruses

• In the 1980’s, scientists began creating antibodies in
non-human immune systems, such as those of mice,
that could target specific sites on cells to fight various
human diseases

• However, mouse derived antibodies are recognized by
the human body as foreign substances and may be
rejected by the human immune system

• PDL’s technology allows for the “humanization” of mouse derived antibodies by moving the
important binding regions from the mouse antibody onto a human framework

• PDL’s humanization technology is important because the humanized antibodies retain the
binding and activity levels from the original mouse antibody

• PDL’s technology has been incorporated into antibodies to treat cancer, eye diseases, arthritis,
multiple sclerosis and other health conditions with aggregate annual sales of over $17 billion

Avastin

• Licensee

▪ Genentech (US) and Roche (ex-US)

• Mechanism

▪ As tumor grows, it exceeds the ability of the local blood supply to
nourish it

▪ Tumor causes up regulation of vascular endothelial growth factor
(VEGF) stimulating angiogenesis (or the growth of leaky blood
vessels) to nourish the tumor

▪ Avastin targets and inhibits VEGF reduction in blood vessels
“starving” the tumor

• Approvals

▪ Metastatic colorectal cancer, advanced non-small cell lung
cancer, renal cancer, metastatic HER2- breast cancer and
glioblastoma

• Sales

▪ 2010 worldwide net sales of $6.4 billion1

• Status

- US is reviewing approval for metastatic HER2- breast cancer
and EU has narrowed this label, resulting in drop in sales for
this indication

- Positive Phase 3 data in treatment of first line and recurrent
ovarian cancer

Treatment with Avastin
reduces vascularization
or blood supply of tumor

1. As reported to PDL by its licensee

Herceptin

• Licensee

▪ Genentech (US) and Roche (ex-US)

• Mechanism

▪ Some breast cancer cells make too many (over-express) copies
of a particular gene known as HER2 that causes rapid growth of
the breast cancer cell

▪ Herceptin works by attaching itself to the HER2 receptors on the
surface of breast cancer cells, blocking them from receiving
growth signals and slowing or stopping the growth of the breast
cancer cell

▪ Herceptin may also fight breast cancer by alerting the immune
system to destroy cancer cells onto which it is attached

• Approvals

▪ Metastatic HER2+ breast cancer, metastatic HER2+ stomach
cancer

• Sales

▪ 2010 worldwide net sales of $5.4 billion1

• Status

▪ Positive Phase 3 results that showed that subcutaneous (SQ)
formulation of Herceptin has comparable safety and efficacy to
intravenous (IV) formulation and can be administered in about 5
minutes compared to 30 minutes for IV formulation.

Without Herceptin treatment,
cell surface receptors signal
into the HER2+ breast cancer
cell to proliferate

Herceptin binds to cell surface
receptors inhibiting
intracellular signals thus
preventing cancer cell
proliferation and signaling the
immune system to “kill” the
cancer cell

1. As reported to PDL by its licensee

Lucentis

• Licensee

▪ Genentech (US) and Novartis (ex-US)

• Mechanism

▪ A form of VEGF known as VEGF-A causes the formation of leaky
blood vessels resulting in the swelling in macula and vision loss

▪ Lucentis binds to and inhibits VEGF-A before it can cause the
formation of the leaky blood vessels preserving and sometimes
improving vision

• Approvals

▪ Wet age-related macular degeneration (AMD), macular edema or
swelling following retinal vein occlusion, diabetic macular edema

• Sales

▪ 2010 worldwide net sales of $3.0 billion1

• Status

§ Recent NIH study comparing safety and effectiveness of Lucentis
finds less expensive Avastin equally efficacious - will adversely
affect future Lucentis sales for AMD

ü It’s estimated that in the U.S. 65% + of AMD patients are
already being treated with off-label Avastin

§ FDA is scheduled to decide on November 18, 2011 whether to
   approve Regeneron’s Eylea, which has shown safety and efficacy
   comparable to Lucentis but can be dosed every other month in
    AMD patients instead of Lucentis’ monthly dosing

§ If approved, Eylea’s more convenient dosing regimen will likely
adversely affect future Lucentis’ sales in AMD

§ Eylea less likely to affect newer Lucentis’ indications
because Eylea is dosed same as Lucentis - monthly

Cross
section of
normal
macula at
back of eye

Cross
section of
macula with
AMD causing
loss of vision

Amsler Grid as
seen through
normal eyes

Amsler Grid as
seen through
eyes with AMD

1. As reported to PDL by its licensee

Xolair

• Licensee

▪ Genentech (US) and Novartis (ex-US)

• Mechanism

▪ IgE plays a role in allergic disease by
causing the release of inflammatory
mediators from mast cells that result in
sneezing, wheezing and asthma

▪ Xolair binds to and neutralizes circulating
IgE by preventing IgE from binding to its
mast-cell receptor

• Approvals

▪ Moderate-to-severe persistent asthma

• Sales

▪ 2010 worldwide net sales of $1.0 billion1

Xolair antibody (yellow) binds to IgE
(blue) preventing IgE from binding to
mast cell. Otherwise, IgE binding to
mast cell would result in wheezing,
sneezing and asthma.

1. As reported to PDL by its licensee

Tysabri

▪ As of October 4, 2011, Biogen Idec reported net patients
adds of 2,100 and 170 cases of PML

In MS, the body’s
autoimmune system is
inappropriately activated,
resulting in it attacking the
body. Here, defense cells,
known as T cells, are
activated.

Activated T cells are able
to cross the blood brain
barrier affording them
access to nerve cells.

Activated T cells attack,
and recruit other defense
cells known as
macrophages, to attack
and consume the myelin
sheath or insulation
surrounding nerve fibers.
The resulting holes in the
myelin slow the
transmission of impulses
along the nerve and
cause the symptoms of
MS.

1. As reported to PDL by its licensee

Actemra

• Licensee

▪ Roche and Chugai

• Mechanism

▪ Rheumatoid arthritis (RA) is an autoimmune
disease in which the body's immune system
attacks itself

▪ One of the defense mechanisms inappropriately
activated in RA is IL-6, which can result in
destruction of the cartilage between joints causing
the symptoms of RA

▪ Actemra binds to and neutralizes IL-6 preventing it
from destroying cartilage, thereby blocking one of
the causes of RA

• Approvals

▪ Treatment of signs and symptoms in moderate-to-
severe adult RA patients, slowing of structural
damage to joints caused by RA and preservation
physical function of joints afflicted by RA

• Sales

▪ 2010 worldwide net sales of $459 million1

It is the degradation and
eventual destruction of this
cartilage that causes the
symptoms of RA.

1. As reported by Roche; assume 1.155 CHF/USD

How Long Will PDL Receive Royalties from
Queen et al. Patents?

• PDL’s revenues consist of royalties generated on sales of licensed products

▪ Sold in a patented jurisdiction before the expiration of the Queen et al. patents in mid-2013 through end of
2014

▪ Made prior to the expiration of the Queen et al. patents in a patented jurisdiction and sold anytime
thereafter

Example of Antibody Formulation, Fill and Finish Schedule

½ month

1 month

½ month

2-3 months

Thaw, Formulation
& Vial Filling

Quality
Release

Packaging
& Quality

Inventory

Example of Antibody Bulk Manufacturing Schedule

Cell

Culture

Quality Release
Testing

Bulk Frozen Storage

1 mo

3 mos

5 mos

10 mos

15 mos

20 mos

27 mos

3 mos

2-18 months

1mo

Purification to Concentrated Bulk/Frozen

Genentech Product Made or Sold in U.S.
Net Sales up to $1.5 Billion	3.0%
Net Sales Between $1.5 Billion and $2.5 Billion	2.5%
Net Sales Between $2.5 Billion and $4.0 Billion	2.0%
Net Sales Over $4.0 Billion	1.0%
Genentech Product Made and Sold Ex-U.S.
All Sales	3.0%

Queen et al Patents - Royalty Rates

• Tysabri and Actemra

• Flat, low single-digit royalty

• Genentech Products (Avastin, Herceptin, Lucentis1 and Xolair)

• Tiered royalties on product made or sold in US

• Flat, 3% royalty on product made and sold outside US

• Blended global royalty rate on Genentech Products in 2010 was 1.9%

• Blended royalty rate on Genentech Products in 2010 made or sold in US was
1.5%

1. As part of a settlement with Novartis, which commercializes Lucentis outside US, PDL agreed to pay to Novartis
certain amounts based on net sales of Lucentis made by Novartis during calendar year 2011 and beyond. The
amounts to be paid are less than we receive in royalties on such sales and we do not currently expect such amount
to materially impact our total annual revenues in 2011.

Shift of Manufacturing Sites = Higher Royalties

• Roche is moving some manufacturing ex-US which may result in higher royalties to PDL due
to the flat 3% royalty for Genentech Products made and sold ex-US

▪ Current production at Penzburg (Herceptin) and Basel (Avastin) plants

▪ Two new plants in Singapore (CHO = antibody and e. coli = antibody fragment)

- E. coli (Lucentis) and CHO (Avastin) plants are approved for commercial supply to the US

- E. coli and CHO plants are expected to be approved for commercial supply to the EU in 2011

- Currently, all Lucentis is made in the US

Percent of Total Worldwide Sales1

1. As reported to PDL by its licensee

Potential Royalty Products - T-DM1

T-DM1

Breast HER2+ Cancer

ü On October 13, 2010, Roche/Genentech announced preliminary,
six month results from a Phase 3 trial in second line HER2+
breast cancer patients which showed that 48% of women treated
with T-DM1 had their tumors shrink compared with 41% of those
taking the combination of Herceptin and Taxotere.

§ Among the women taking the standard therapy, 75% had
side effects of grade 3 or higher on a 5-point scale,
compared with 37% of those getting T-DM1.

ü Roche highlighted this product in their November 7, 2011 update
to the financial community on their late stage development
products.

ü Roche/Genentech expect to file for second line approval in 2012
and first line in 2014.

Ocrelizumab

Multiple Sclerosis

Pertuzumab

Breast HER2+ Cancer

Afutuzumab

Chronic Lymphocytic
Leukemia

Solanezumab

Alzheimer’s Disease

Daclizumab

Multiple Sclerosis

Datoluzumab

Colorectal Cancer

Bapineuzumab

Alzheimer’s Disease

Farletuzumab

Ovarian Cancer

Potential Royalty Products - Pertuzumab

T-DM1

Breast HER2+ Cancer

ü On December 10, 2010, Roche/Genentech reported the results
from a Phase 2 trial investigating the neoadjuvant (prior to
surgery) use of pertuzumab and Herceptin plus chemotherapy
for the treatment of early-stage, HER2+ breast cancer.

ü Treatment significantly improved the rate of complete tumor
disappearance in the breast by more than half compared to
Herceptin plus docetaxel, p=0.014.

ü On July 15, 2011, Roche/Genentech reported the results from a
Phase 3 trial in pertuzumab plus Herceptin and docetaxel met
the primary endpoint of progression-free survival (PFS) vs.
Herceptin plus docetaxel alone.

ü Roche highlighted this product in their November 7, 2011 update
to the financial community on their late stage development
products.

ü Roche/Genentech expect to file for approval at the end of 2011.

Ocrelizumab

Multiple Sclerosis

Pertuzumab

Breast HER2+ Cancer

Afutuzumab

Chronic Lymphocytic
Leukemia

Solanezumab

Alzheimer’s Disease

Daclizumab

Multiple Sclerosis

Datoluzumab

Colorectal Cancer

Bapineuzumab

Alzheimer’s Disease

Farletuzumab

Ovarian Cancer

Potential Royalty Products - Bapineuzumab &
Solanezumab

T-DM1

Breast HER2+ Cancer

ü Both antibodies to beta amyloid are in Phase 3.

ü On July 19, 2011, researchers from Pfizer and Johnson &
Johnson reported long-term safety of 194 patients in a mid-stage
trial of bapineuzumab that stayed on treatment after the initial
phase ended.

ü Data on both drugs expected in second half of 2012.

ü PDL has 12.5 year know-how royalty on Solanezumab and
patent royalty on both drugs.

Ocrelizumab

Multiple Sclerosis

Pertuzumab

Breast HER2+ Cancer

Afutuzumab

Chronic Lymphocytic
Leukemia

Solanezumab

Alzheimer’s Disease

Daclizumab

Multiple Sclerosis

Datoluzumab

Colorectal Cancer

Bapineuzumab

Alzheimer’s Disease

Farletuzumab

Ovarian Cancer

Genentech / Roche - Product Pipeline

2011

2012

2013

2014

Avastin

Ovarian Cancer 1st Line (US)

Lucentis

Diabetic Macular Edema (US)

Pertuzumab

mBC HER2+ 1st Line

Avastin

Relapsed Ovarian Cancer (EU)

T-DM1

HER 2+ Advanced mBC

Actemra

RA DMARD H2H (EU)

Actemra

DMARD IR (US)

Herceptin

Subcutaneous Formulation

Avastin & Herceptin

HER2+ mBC 1st Line

Avastin

mCRC TML

Actemra

SC Formulation (EU)

Afutuzumab (GA101)

Chronic Lymphocytic Leukemia

Actemra

Avastin

BC Adjuvant HER2+

Avastin

BC Adj Triple Negative

Herceptin

BC HER 2+ Adj 2 Year

Xolair

Chronic Idiopathic
Urticaria

Avastin

Glioblastoma 1st Line

Actemra

SC Formulation (US)

T-DM1

HER 2+ mBC 1st Line

Ocrelizumab1

PPMS & RRMS

1.Not a licensed product

Source: Roche investor update, September 30, 2011

US & EU Filings Calendar

Avastin

MBC 2nd line (EU)

Avastin

Relapsed Ovarian Cancer (US)

Lucentis

AMD 0.5 mg PRN (US)

Current and Long-Term Liabilities

• $155 million 3.75% senior convertible notes due May 2015

▪ Notes issued May 16, 2011; conversion rate is 132.6682 / $1,000 face amount ($7.54/share)

▪ Bond hedge effectively increases conversion price to $8.87 / share

▪ Notes “net share settle” and are excluded from diluted EPS

• $180 million 2.875% convertible senior notes due February 2015

▪ Conversion rate is 151.713 shares / $1,000 face amount ($6.59/share)

▪ PDL has commenced a tender offer for all or a substantial portion of these Notes in exchange for new
notes that net share settle - similar to terms of “net share settle” provision in 3.75% Notes which excludes
such shares from diluted EPS

• $300 million 10.25% secured non-
recourse notes; principal balance of
$115 million as of September 30, 2011

▪ Approximately 40% of Genentech royalties
dedicated to quarterly principal and interest

▪ After retirement, securitized Genentech royalties
will be retained by PDL

• The purpose of restructuring PDL’s debt
is to free up cash for the acquisition of
new royalty assets

Pending Dispute with Genentech and Roche

• In August 2010, Genentech sent a fax on behalf of Roche and Novartis
asserting its products do not infringe PDL’s supplementary protection
certificates (SPCs)

▪ Products include Avastin, Herceptin, Lucentis and Xolair

▪ SPCs are patent extensions in Europe that are issued on a country-by-country and product-
by-product basis

• PDL Response

▪ Genentech’s assertions are without merit

▪ PDL disagrees with Genentech’s assertions of non-infringement

▪ Genentech had waived its rights to challenge our patents, including SPCs in its 2003
Settlement Agreement with PDL

• 2003 Settlement Agreement

▪ Resolved intellectual property disputes between the two companies at that time

▪ Limits Genentech’s ability to challenge infringement of PDL’s patent rights, including SPCs,
and waives Genentech’s right to challenge or assist other in challenging the validity of our
patent rights

Nevada Lawsuit Against Genentech/Roche

• PDL filed a lawsuit against Genentech and Roche in Nevada state court

▪ Lawsuit states that fax constitutes a breach of 2003 Settlement Agreement because Genentech assisted
Roche in challenging PDL’s patents and SPCs

▪ Complaint seeks compensatory damages, including liquidated damages and other monetary remedies set
forth in the 2003 Settlement Agreement, punitive damages and attorney’s fees

• In November 2010, Genentech and Roche filed two motions to dismiss

▪ They contend that 2003 Settlement Agreement applies only to PDL’s U.S. patents

▪ They asserted that the Nevada court lacks personal jurisdiction over Roche

• On July 11, 2011, court denied Genentech and Roche's motion to dismiss four of PDL's
five claims for relief and denied Roche's separate motion to dismiss for lack of personal
jurisdiction.

▪ The court dismissed one of PDL's claims that Genentech committed a bad-faith breach of the covenant of
good faith and fair dealing

▪ Subsequent to the ruling, Roche has waived its defense that the Nevada court lacks personal jurisdiction for
the purposes of this lawsuit

• The court ruling allows PDL to continue to pursue its claims that:

▪ Genentech is obligated to pay royalties to PDL on international sales of the Genentech Products

▪ Genentech, by challenging, at the behest of Roche and Novartis, whether PDL's SPCs cover the Genentech
Products breached its contractual obligations to PDL under the 2003 settlement agreement

▪ Genentech breached the implied covenant of good faith and fair dealing with respect to the 2003 settlement
agreement

▪ Roche intentionally and knowingly interfered with PDL's contractual relationship with Genentech in
conscious disregard of PDL's rights

▪ Parties are currently in discovery

Business Strategy

• Purchase new royalty assets and
ladder like a bond portfolio

▪ Continue to reinvest in new royalty
assets and pay dividends

- Commercial stage products

- Sweet spot $75MM to $150MM

▪ Debt repaid by end of 2015

▪ Company continues as long as it can
generate satisfactory return

• If unable to acquire royalty assets on
attractive terms, build cash reserves
to:

▪ Repay debt

▪ Use all excess cash to pay dividends to
enhance shareholder return

▪ Wind-up company in 2016 timeframe

• Queen et al. patents expire in mid-2013
to December 2014; we anticipate
royalties will likely continue to ~2016

• PDL has two possible future pathways

Investment Highlights

• Strong historic revenue growth from approved products

• Potential for additional indications from existing
products, new product approvals and purchase of new
royalty assets

• Potential to grow and diversify revenues with the
addition of new royalty assets

• Significantly reduced expenses with no R&D burn

• Liquidity - volume averages 2.1 million shares/day

• Return to stockholders

▪ In 2011, $0.60/share to be paid in quarterly regular dividends of
$0.15/share on March 15, June 15, September 15 and
December 15

Royalty Products - Avastin

Avastin

Herceptin

Lucentis

Xolair

Tysabri

Actemra

ü Since June 29, 2011, an FDA advisory committee, an FDA
special committee and FDA staff have recommended that
approval of Avastin for the treatment of HER2- breast cancer
should be revoked.

ü Genentech has submitted a new proposal to maintain the
approval with more restrictive labeling, REMS and a
commitment to conduct a new 480 patient confirmatory trial.

ü Final decision rests with the FDA Commissioner.

ü EMEA narrowed, but did not withdraw Avastin’s approval for
first line treatment of HER2- breast cancer in combination
with paclitaxel or with Xeloda.

ü Roche lowered its estimate of peak annual sales of Avastin
from CHF8 - CHF9 billion to CHF7 billion.

ü PDL believes that this indication is generating little US
revenue.

Royalty Products - Avastin

Avastin

Herceptin

Lucentis

Xolair

Tysabri

Actemra

ü On June 4, 2011, Genentech announced results from Phase 3
study evaluating Avastin in combination with chemotherapy
(gemcitabine and carboplatin) followed by the continued use of
Avastin alone in women with previously treated (recurrent)
platinum-sensitive ovarian cancer which showed that women
who received Avastin experienced a 52% reduction in the risk of
their disease progressing (HR=0.48, p<0.0001) compared to
women who received chemotherapy alone.

ü Two previous Phase 3 studies in women with newly diagnosed
ovarian cancer demonstrated that front-line Avastin in
combination with standard chemotherapy (carboplatin and
paclitaxel), followed by the continued use of Avastin alone,
significantly increased progression free survival compared to
treatment with chemotherapy alone.

ü In August 2011, Roche submitted an application for approval for
first line treatment in EU.

ü Genentech expects to file an application for approval in US in
late 2011 so that it can meet FDA’s request for overall survival
data.

Royalty Products - Lucentis

Avastin

Herceptin

Lucentis

Xolair

Tysabri

Actemra

ü On January 7, 2011, Novartis announced that Lucentis has been
approved in the EU for the treatment of visual impairment due to
diabetic macular edema (DME).

ü On June 6, 2011, Novartis announced that Lucentis has been
approved in the EU for the treatment of visual impairment due to
macular edema secondary to retinal vein occlusion.

§ DME is a leading cause of blindness in the working-age
population in most developed countries.

ü On June 28, 2011, Genentech reported positive results from two
pivotal Phase 3 clinical studies in patients with diabetic macular
edema.

§ Both studies showed that patients treated with Lucentis
experienced significant, rapid and sustained improvement in
vision compared to those who received sham injections.

§ Additional analyses showed that patients who received
Lucentis were significantly more likely to achieve 20/40 vision
and experience less progression of underlying diabetic
retinopathy disease.

Royalty Products - Lucentis

Avastin

Herceptin

Lucentis

Xolair

Tysabri

Actemra

ü On November 22, 2010, Regeneron and Bayer reported top line data
from two Phase 3 trials investigating VEGF Trap in age-related
macular degeneration (AMD) patients which suggest that it may be
injected into the eye every other month with safety and efficacy
comparable to that of monthly dosing of Lucentis.

ü On December 20, 2010, Regeneron reported positive Phase 3 data in
the treatment of retinal vein occlusion (RVO) for which Lucentis is
approved.

§ Unlike the AMD trial, monthly administration was used in the RVO
trial, which does not afford a dosing advantage with respect to
Lucentis.

ü On February 22, 2011, Regeneron and Bayer filed an application for
approval of VEGF Trap for AMD with an initial PDUFA date of August
20, 2011 which was subsequently extended to November 18, 2011.
An FDA Advisory Committee recommended approval of VEGF Trap
on June 17, 2011.

ü On June 7, 2011, Regeneron and Bayer filed an application for AMD
in EU.

ü Regeneron filed suit in February 2011 seeking a summary judgment
that it does not infringe Genentech’s patents.

ü Genentech filed a countersuit in April 2011 asserting that Regeneron
is willfully infringing Genentech’s patents, seeking treble damages and
asking for injunctive relief.

Royalty Products - Lucentis

Avastin

Herceptin

Lucentis

Xolair

Tysabri

Actemra

ü On April 4, 2011, Genentech and Johns Hopkins University
reported results of a review of files of 77,886 patients with AMD
who received either Avastin off-label or Lucentis.

ü Patients receiving Avastin off-label had an 11% increased risk of
overall mortality, 57% increased risk of hemorrhagic
cerebrovascular accident, 80% more likely to have ocular
inflammation and 11% more likely to have cataract surgery
following treatment than Lucentis treated patients.

ü Authors of the study note that it is limited due to incomplete
information on confounding factors such as smoking, lipid and
blood pressure levels, etc.

Royalty Products - Lucentis

Avastin

Herceptin

Lucentis

Xolair

Tysabri

Actemra

ü On April 28, 2011, New England Journal of Medicine reported
the results from the NEI’s CATT study comparing Lucentis and
Avastin on fixed and variable schedules in the treatment of AMD.

ü Efficacy results from the first year of the two year study showed
that, with respect to the primary endpoint of mean change in
visual acuity (number of lines of letters on an eye chart) at 12
months, less expensive Avastin was not inferior to Lucentis.

§ It is estimated that off label use of Avastin in the U.S. was
60% prior to the results of the CATT trial.

ü At 12 months, serious adverse events (primarily hospitalizations)
occurred at a 24% rate for patients receiving Avastin and a 19%
rate for patients receiving Lucentis. However, preliminary 24
month safety data showed no difference between Lucentis and
Avastin treated patients in terms of death, stroke and all
arteriothrombotic events.

ü On August 30, 2011, FDA issued a health warning alert after at
least 16 AMD patients suffered eye infections after being treated
with repackaged Avastin.

Royalty Products - Tysabri

Avastin

Herceptin

Lucentis

Xolair

Tysabri

Actemra

ü In the label for Tysabri, EMEA has included, and FDA is
considering including, JC virus (JCV) status as a risk factor for the
rare but sometimes fatal brain infection known as PML.

ü Because patients have increased risk of developing PML after 24
months of Tysabri treatment and because physicians can use this
assay to detect presence of JC virus and take patients off Tysabri if
JC virus is detected, physicians have become more comfortable
prescribing Tysabri.

ü As of October 4, 2011, Biogen Idec reported net patients adds of
2,100 and 170 cases of PML.

§ Net patient adds is the difference between new patients
treated less those who discontinued Tysabri therapy due to
JC virus status or other reasons.

Royalty Products - Actemra

Avastin

Herceptin

Lucentis

Xolair

Tysabri

Actemra

ü On January 5, 2011, Roche announced that FDA expanded the
Actemra label to include inhibition and slowing of structural joint
damage, improvement of physical function, and achievement of
major clinical response in adult patients with moderately to
severely active rheumatoid arthritis.

ü On April 18, 2011, FDA approved Actemra to treat patients age 2
and older with active systemic juvenile idiopathic arthritis (SJIA).

§ It is the first approved treatment for SJIA, a rare and severe
form of arthritis affecting children.

ü On July 19, 2011, Chugai/Roche announced that a
subcutaneous formulation of Actemra has shown efficacy in
rheumatoid arthritis comparable to the approved intravenous
formulation. Based on these non-inferiority data, the company
plans to file for approval in Japan in 2012.

Potential Royalty Products - T-DM1

T-DM1

Breast HER2+ Cancer

§ Among the women taking the standard therapy, 75% had
side effects of grade 3 or higher on a 5-point scale,
compared with 37% of those getting T-DM1.

ü Roche highlighted this product in their November 7, 2011 update
to the financial community on their late stage development
products.

ü Roche/Genentech expect to file for second line approval in 2012
and first line in 2014.

Ocrelizumab

Multiple Sclerosis

Pertuzumab

Breast HER2+ Cancer

Afutuzumab

Chronic Lymphocytic
Leukemia

Solanezumab

Alzheimer’s Disease

Daclizumab

Multiple Sclerosis

Datoluzumab

Colorectal Cancer

Bapineuzumab

Alzheimer’s Disease

Farletuzumab

Ovarian Cancer

Potential Royalty Products - Ocrelizumab

T-DM1

Breast HER2+ Cancer

ü Phase 2b.

ü Genentech announced 96-week results from Phase 2 study in
patients with relapsing-remitting multiple sclerosis which showed
that the significant reduction in disease activity as measured by
the total number of active brain lesions and relapses, previously
reported for 24 weeks, was maintained through 96 weeks.

ü Unlicensed product.

Ocrelizumab

Multiple Sclerosis

Pertuzumab

Breast HER2+ Cancer

Afutuzumab

Chronic Lymphocytic
Leukemia

Solanezumab

Alzheimer’s Disease

Daclizumab

Multiple Sclerosis

Datoluzumab

Colorectal Cancer

Bapineuzumab

Alzheimer’s Disease

Farletuzumab

Ovarian Cancer

Potential Royalty Products - Pertuzumab

T-DM1

Breast HER2+ Cancer

ü Treatment significantly improved the rate of complete tumor
disappearance in the breast by more than half compared to
Herceptin plus docetaxel, p=0.014.

ü Roche highlighted this product in their November 7, 2011 update
to the financial community on their late stage development
products.

ü Roche/Genentech expect to file for approval at the end of 2011.

Ocrelizumab

Multiple Sclerosis

Pertuzumab

Breast HER2+ Cancer

Afutuzumab

Chronic Lymphocytic
Leukemia

Solanezumab

Alzheimer’s Disease

Daclizumab

Multiple Sclerosis

Datoluzumab

Colorectal Cancer

Bapineuzumab

Alzheimer’s Disease

Farletuzumab

Ovarian Cancer

Potential Royalty Products - Bapineuzumab

T-DM1

Breast HER2+ Cancer

ü Phase 3.

ü   On July 19, 2011, researchers from Pfizer and Johnson &
   Johnson reported long-term safety of 194 patients in a mid-stage
   trial of the drug that stayed on treatment after the initial phase
   ended.

§ The brain swelling condition called vasogenic edema, which
caused safety concerns early on in the trial, may decrease
over time.

ü Data expected in second half of 2012.

Ocrelizumab

Multiple Sclerosis

Pertuzumab

Breast HER2+ Cancer

Afutuzumab

Chronic Lymphocytic
Leukemia

Solanezumab

Alzheimer’s Disease

Daclizumab

Multiple Sclerosis

Datoluzumab

Colorectal Cancer

Bapineuzumab

Alzheimer’s Disease

Farletuzumab

Ovarian Cancer

Company	PDL BioPharma, Inc.
Ticker	PDLI (NASDAQ)
Location	Incline Village, Nevada
Employees	Less than 10
2010 Revenues	$345 million
2011- Q3YTD Revenue	$289 million
2011 Regular Dividends	$0.15 /share paid on March 15, June 15, September 15 & December 15
Q3-2011 Cash Position1	$225 million
Shares O/S2	~ 140 million
Average Daily Volume	~ 2.1 million shares