8-K

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):  January 9, 2012

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 7.01 Regulation FD Disclosure.

Beginning on January 9, 2012, PDL BioPharma, Inc. (the Company) will participate in conferences with investors and analysts during the 30th Annual JP Morgan Healthcare Conference in San Francisco, California, and will make a general presentation at the conference on January 12, 2012.  A copy of the Company’s presentation materials used in both the conferences and the presentation has been posted to the Company’s website and is attached hereto as Exhibit 99.1.

Limitation of Incorporation by Reference

In accordance with General Instruction B.2. of Form 8-K, this information, including the Exhibit, is furnished pursuant to Item 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. The information in this Item 7.01 of this Current Report on Form 8-K will not be deemed an admission as to the materiality of any information that is required to be disclosed solely by Regulation FD.

Cautionary Statements

This Current Report on Form 8-K and the presentations 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 2010 Annual Report on Form 10-K and other periodic 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.

(d) Exhibits.

Exhibit No.	Description
99.1	Presentation

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/ John P. McLaughlin
		John P. McLaughlin
		President and Chief Executive Officer
Dated:  January 9, 2012

EXHIBIT INDEX

Exhibit No.	Description
99.1	Presentation

EX-99.1

Exhibit 99.1

30th Annual J.P. Morgan Healthcare Conference

January 9-12, 2012

1

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 litigationor 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 atwww.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.

2

Company	PDL BioPharma, Inc.
Ticker	PDLI (NASDAQ)
Location	Incline Village, Nevada
Employees	Less than 10
2010 Revenues	$345 million
2011 Anticipated Revenue	$361 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 million shares

Key Information

1. As of September 30, 2011; 2. Not fully diluted

3

Overview of PDL BioPharma

4

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

5

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

6

Mission Statement

•Queen et al. Patents

▪Manage patent portfolio

▪Manage license agreements

•Purchase new royalty generating assets

▪Assets that improve shareholder return

▪Commercial stage assets

▪Prefer biologics with strong patent protection

•Optimize return for shareholders

7

Corporate Governance

Management

•John McLaughlin
President & CEO

•Christopher Stone
VP, General Counsel &
Secretary

•Caroline Krumel
VP of Finance

•Danny Hart
Associate General Counsel

Board of Directors

•Fred Frank
Lead Director

•Jody Lindell

•John McLaughlin

•Paul Sandman

•Harold Selick

8

Licensed Products and Royalty Revenue

9

Approved Licensed Products: Overview

1. As reported to PDL by its licensee 2. As reported by Roche; assume 1.155 CHF/USD

10

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

or

▪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

1mo

Purification to Concentrated Bulk/Frozen

11

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.
Net 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.

12

Potential Shift to Ex-US 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

-Currently, all Lucentis is made in the US

Percent of Net Worldwide Sales1

1. As reported to PDL by its licensee

13

Royalty Revenue & Licensed Products

Royalties by Product

($ in millions)

14

Royalty Products - Approved

15

Royalty Products - Avastin

Avastin

Herceptin

Lucentis

Xolair

Tysabri

Actemra

üOn November 18, 2011, FDA revoked its approval for
treatment of HER2-negative breast cancer effective
immediately.

§This decision does not affect any of the Avastin’s other
approvals.

§Genentech announced that it will start Phase 3 trial in
2012 of Avastin plus paclitaxel in previously untreated
metastatic breast cancer.

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

16

Royalty Products - Herceptin

Avastin

Herceptin

Lucentis

Xolair

Tysabri

Actemra

üOn October 18, 2011, Roche announced Phase 3 results that
showed that subcutaneous (SQ) formulation of Herceptin has
comparable safety and efficacy to intravenous (IV) formulation.

üSQ formulation is ready-to-use and requires about 5 minutes to
administer compared to 30 minutes administration time for IV
formulation.

17

Royalty Products - Lucentis

Avastin

Herceptin

Lucentis

Xolair

Tysabri

Actemra

üOn 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).

üIn October 2011, Genentech announced that it had filed an
application for approvalwiththe FDA for the treatment of visual
impairment due to DME.

üOn 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.

üOn 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.

18

Royalty Products - Lucentis

19

Avastin

Herceptin

Lucentis

Xolair

Tysabri

Actemra

üOn November 18, 2011, FDA approved Regeneron and Bayer’s Eylea
for the treatment of age-related macular degeneration (AMD).

§FDA approved a dosing schedule of monthly injections for the
first three months and bi-monthly injections thereafter.

§Many physicians currently give AMD patients monthly injections
of Lucentis for the first few months and then treat on an “as
needed to maintain vision” basis.

§Eylea is priced at $100 less per injection than Lucentis
(Lucentis = $1,950 per injection)

üOn January 3, 2012, Regeneron and Genentech announced a
settlement of their patent litigation regarding Eylea under which
Regeneron will pay royalties to Genentech on Eylea sales.

Royalty Products - Tysabri

Avastin

Herceptin

Lucentis

Xolair

Tysabri

Actemra

üIn 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.

üBecause 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.

üAs 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.

20

PotentialRoyalty Products
- Development Stage

21

Potential Royalty Products - T-DM1

T-DM1

Breast HER2+ Cancer

üOn 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.

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

üRoche/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

22

Potential Royalty Products - Ocrelizumab

T-DM1

Breast HER2+ Cancer

üPhase 2b.

üGenentech announced 96-week results fromPhase 2 study in
patients with relapsing-remitting multiple sclerosiswhich 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.

üUnlicensed 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

23

Potential Royalty Products - Pertuzumab

24

T-DM1

Breast HER2+ Cancer

üOn 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.

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

§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.

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

üOn December 7, 2011, Genentech and Roche announced that
they had filed applications for approval in US and EU for
treatment of patients with previously untreated, HER2-positive
metastatic breast cancer.

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 - Afutuzumab

T-DM1

Breast HER2+ Cancer

üPhase 3.

üRoche/Genentech expect to file for approval in 2013.

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

25

Potential Royalty Products - Bapineuzumab

T-DM1

Breast HER2+ Cancer

üPhase 3.

üOn 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.

üData 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

26

Potential Royalty Products - Solanezumab

T-DM1

Breast HER2+ Cancer

üPhase 3.

üData expected in second half of 2012.

ü12.5 year know how royalty in addition to patent royalty.

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

27

Potential Royalty Products - Daclizumab

T-DM1

Breast HER2+ Cancer

üPositive efficacy data reported from first of two Phase 3 trials.

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

28

Genentech / Roche - Product Pipeline

2011

2012

2013

2014

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

SubcutaneousFormulation

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 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)

Financials

30

Financial Overview

31

Debt

32

Current and Long-Term Liabilities

•$155 million 3.75% Convertible Senior Notes due May 2015

§Notes issued May 16, 2011; current conversion rate is 135.9607 / $1,000 face amount
(~$7.36/share)

§Bond hedge effectively increases conversion price to $8.65 / share

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

•$11 million 2.875% Convertible Senior Notes due February 2015

§Conversion rate is 155.396 shares / $1,000 face amount (~$6.44/share) 

§On January 3, 2012, holders of approximately $169 million of these notes accepted PDL’s
offer to exchange for PDL’s new 2.875% Series 2012 Convertible Senior Notes due
February 2015 that “net share settle”

§Effect of exchange is to reduce potential dilution by ~26 million shares

•$169 million 2.875% Series 2012 Convertible Senior Notes due February
2015

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

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

§Non-recourse notes

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

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

33

Legal Matters

34

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’spatent rights, including SPCs,
and waives Genentech’s right to challenge or assist other in challenging the validity of our
patent rights

35

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

36

Optimizing Stockholder Return

37

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

38

Optimizing Stockholder Return

•Continuously evaluating alternatives

▪Dividends

▪Capital restructure

▪Share repurchase

▪Company sale

▪Purchase of commercial stage, royalty
generating assets

39

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 million shares/day

•Return to stockholders

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

▪2012 Dividend Policy to be announced shortly

40