- Revenues From Continuing Operations Increase 25 Percent to $62.6 Million -

- Conference Call Today at 4:30 p.m. Eastern Time -

INCLINE VILLAGE, Nev., May 7 /PRNewswire-FirstCall/ -- PDL BioPharma, Inc. (PDL) (Nasdaq: PDLI) today reported financial results for the first quarter ended March 31, 2009.

Total revenues from continuing operations for the first quarter of 2009 were $62.6 million, a 25 percent increase from $50.2 million for the same period in 2008. The increase was primarily due to increases in royalty revenues driven by higher product sales of Avastin(R), Herceptin(R) and Lucentis(R), which are marketed by Genentech, Inc., a subsidiary of F. Hoffman-La Roche Ltd., and sales of Tysabri(R), which is marketed by Elan Corporation, Plc. Royalty revenues are based on fourth quarter product sales by PDL's licensees and include those for Synagis(R), which is marketed by MedImmune, Inc.

'We were pleased to begin fulfilling the goal of income distribution to stockholders by paying our first post-spin-off dividend in April, a result of the revenues and profits PDL is generating from royalties on a diversified portfolio of successful products,' said John McLaughlin, president and chief executive officer of PDL BioPharma. 'Our new and focused strategy seeks to optimize our assets to benefit stockholders without the diversion, expense, and considerable risk of research and development.'

Total general and administrative expenses from continuing operations in the first quarter of 2009 were $4.7 million compared with $12.7 million in the first quarter of 2008. The decrease was primarily driven by the Company's reduced cost structure. Significant expense items for the first quarter of 2009 included $1.6 million in legal fees for patent prosecution, patent defense and corporate compliance as well as $0.9 million in software depreciation expense for which the software is now fully depreciated and is no longer in use.

Net income for the first quarter of 2009 was $37.5 million, or $0.23 per diluted share, compared with a net loss of $61.9 million in the same period of 2008, or a net loss of $0.42 per diluted share.

Net cash provided by operating activities was $27.7 million for the first quarter of 2009 as compared with net cash used in operating activities of $29.3 million for the first quarter of 2008. In addition to cash provided by operating activities in the three months ended March 31, 2009, we recognized $18.1 million of excess tax benefits from stock-based compensation, which is classified as a financing cash flow. At March 31, 2009, PDL had cash, cash equivalents, short-term investments and restricted cash of $193.2 million, compared with $147.5 million at December 31, 2008.

2009 Dividends

PDL previously announced that it would pay two dividends to its stockholders in 2009 of $0.50 per share. The first dividend, totaling $59.7 million, was paid on April 1, 2009 to all stockholders who owned shares of PDL on March 16, 2009. The second dividend will be paid on October 1, 2009 to stockholders of record on such date as to be determined by the Board of Directors at its June 2009 meeting.

Recent Developments

    -- Elected Frederick Frank and Jody Lindell to the Company's Board of
       Directors in March 2009 and subsequently designated Mr. Frank as Lead
       Director.
    -- As a result of the April 1, 2009 dividend payment, we announced
       An adjustment to the conversion rate for the Company's 2.75%
       Convertible Subordinated Notes due August 16, 2023 (the '2023 Notes').
       The conversion rate, as adjusted, is 123.715 shares of common stock per
       $1,000 principal amount of the 2023 Notes, effective March 17, 2009.
       The conversion rate for the 2023 Notes was previously 114.153 shares
       of common stock per $1,000 principal amount of the 2023 Notes.
    -- As a result of the April 1, 2009 dividend payment, we announced an
       adjustment to the conversion rate for the Company's 2.00% Convertible
       Senior Notes due February 15, 2012 (the '2012 Notes'). The conversion
       rate, as adjusted, is 89.165 shares of common stock per $1,000
       principal amount of the 2012 Notes, effective March 17, 2009. The
       conversion rate for the 2012 Notes was previously 82.162 shares of
       common stock per $1,000 principal amount of the 2012 Notes.
    -- Alexion agreed to pay PDL $25 million, of which it paid $12.5 million
       in January 2009 and is obligated to pay the second installment of
       $12.5 million in June 2009.
    -- In February of 2009, we received a letter from MedImmune asserting that
       it may be entitled to pay a lower royalty rate on sales of Synagis
       because of our settlement with Alexion.