Exhibit 99.3
PDL BioPharma, Inc.
Q4 2015
February 22, 2016
Following are some of the key points regarding PDL’s fourth quarter and year end 2015 financial and business results.
Net Income
Net income in 2015 was $332.8 million, or $2.03 per diluted share as compared with net income in 2014 of $322.2 million, or $1.86 per diluted share. Net income for the fourth quarter of 2015 was $100.6 million, or $0.61 per diluted share, as compared with net income of $55.1 million in the same period of 2014, or $0.32 per diluted share.
Updates on Approved Royalty Bearing Products related to Queen et al. patents
Avastin® (bevacizumab):
| |
| • | On January 28, 2016, Genentech/Roche reported that 2015 worldwide sales were CHF 6.684 billion and increased by 9%. |
Herceptin® (trastuzumab):
| |
| • | On January 28, 2016, Genentech/Roche reported that 2015 worldwide sales were CHF 6.538 billion and increased by 10%. |
Xolair® (omalizumab):
| |
| • | On January 28, 2016, Genentech/Roche reported that 2015 US sales were CHF 1.277 billion and increased by 25%. |
| |
| • | On January 27, 2016, Novartis reported that 2015 ex-US sales were $755 million and increased by 14%. |
Tysabri® (natalizumab):
| |
| • | On January 27, 2016, Biogen reported that 2015 worldwide sales were $1.9 billion, down from $2 billion in 2014. |
Perjeta® (pertuzumab):
| |
| • | On January 28, 2016, Genentech/Roche reported that 2015 worldwide sales were CHF 1.445 billion and increased by 61%. |
Kadcyla® (TDM-1 or ado-trastuzumab emtansine):
| |
| • | On January 28, 2016, Genentech/Roche reported that 2015 worldwide sales were CHF 769 million and increased by 51%. |
Updates on Unapproved Royalty Bearing Products Related to Queen et al. patents
Solanezumab
| |
| • | On January 5, 2016, Lilly re-affirmed that topline data from its Phase 3 trial in patients with mild Alzheimer’s Disease is expected in late 2016. |
Updates on Income Generating Assets
Wellstat Diagnostics, LLC
| |
| • | PDL has moved for summary judgment in New York state court to enforce guarantees related to non-Wellstat Diagnostics’ assets. |
PDL BioPharma, Inc.
Q4 2015
February 22, 2016
Depomed, Inc.
| |
| • | In November, December and January, Valeant paid $5.3 million, $7.7 million and $13.1 million for royalties on net sales of Glumetza in October, November and December, respectively. |
| |
| • | Much of the increase in the last payment is related to the recently taken price increases. |
| |
| • | First generic introduction on February 1, 2016 is not expected to affect price significantly. Second and third generic introductions on August 1, 2016 typically have greater effect on price and sales. |
| |
| ◦ | Both generic introductions were modeled at the time of acquisition of this royalty using typical generic erosion curves. |
| |
| ◦ | Significant price increase implemented by Valeant recently was not modeled at time of acquisition so is an upside. |
| |
| • | Because revenues are exceeding PDL’s internal models, even after the introduction of the first generic earlier this month, after consultation with an independent third party consultant that helps forecast these revenues, the company has increased the valuation of this asset in Q4 of 2015 by approximately $13 million as reflected in our financials. |
| |
| • | PDL and Depomed are commencing a royalty audit on Glumetza royalties owed by Valeant. |
Direct Flow Medical, Inc.
| |
| • | Hired Daniel Lemaitre as CEO, former CEO of CoreValve, one of the early pioneers in transcatheter aortic valves, which was sold to Medtronic. |
| |
| • | Hired David Boyle as CFO, formerly CFO of AVI BioPharma, Bionovo and Salix. |
| |
| • | In January 2016, PDL funded an additional $5.0 million in the form of a short term secured promissory note that we expect will be converted into a loan under the current credit agreement with substantially the same terms. |
LENSAR, Inc.
| |
| • | Assets of Lensar acquired by Alphaeon. |
| |
| • | $42 million loan to Lensar assumed by Alphaeon. |
| |
| • | Alphaeon issued 1.7 million shares of common stock to PDL as part of transaction. |
kaleo, Inc.
| |
| • | On February 18, 2016, PDL was advised that Sanofi has terminated its agreement with kaleo and returned the product to kaleo. |
| |
| • | kaleo intends to evaluate the timing and options for bringing Auvi-Q back to the market. |
| |
| • | In Q4 2015, PDL received $9.5 million payment from kaleo, which was both timely and payment in full for amounts due in 4Q15. It included $4.6 million in principal and $4.9 million in interest payment due. |
| |
| • | An interest reserve account provides interest payments to PDL through the end of 2Q16 if there are no further payments from kaleo on Auvi-Q. |
| |
| • | kaleo has indicated that it will make any payments due until Auvi-Q returns to the market. |
ARIAD Pharmaceuticals, Inc.
| |
| • | Data on ARIAD's second product, brigatinib, in a potentially pivotal trial in non small cell lung cancer, is expected at ASCO in summer of 2016. |
| |
| • | This is a back up source of repayment for PDL. |
| |
| • | On January 8, 2016, ARIAD reported that it had filed for approval of Iclusig in Japan. |
| |
| • | A percentage of Iclusig worldwide revenues are the primary source of repayment for PDL. |
PDL BioPharma, Inc.
Q4 2015
February 22, 2016
Forward-looking Statements
This document contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Each of these forward-looking statements involves risks and uncertainties. Actual results may differ materially from those, express or implied, in these forward-looking statements. Important factors that could impair the value of the Company's royalty assets, restrict or impede the ability of the Company to invest in new income generating assets and limit the Company's ability to pay dividends are disclosed in the risk factors contained in the Company's Annual Report on Form 10-K, as updated by subsequent quarterly reports filed with the Securities and Exchange Commission, as updated by subsequent filings. All forward-looking statements are expressly qualified in their entirety by such factors. We do not undertake any duty to update any forward looking statement except as required by law.
PDL BioPharma, Inc.
Q4 2015
February 22, 2016
|
| | | | | | | | | | |
| Queen et al. Royalties |
| Royalty Revenue by Product ($ in 000's) * |
| Avastin | Q1 | Q2 | Q3 | Q4 | Total |
| 2015 | 38,809 |
| 38,447 |
| 39,284 |
| 39,987 |
| 156,527 |
|
| 2014 | 38,122 |
| 38,924 |
| 38,864 |
| 40,723 |
| 156,632 |
|
| 2013 | 33,234 |
| 46,720 |
| 32,224 |
| 32,287 |
| 144,464 |
|
| 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 |
| 2015 | 37,875 |
| 39,476 |
| 39,457 |
| 38,897 |
| 155,704 |
|
| 2014 | 36,646 |
| 38,292 |
| 39,407 |
| 40,049 |
| 154,394 |
|
| 2013 | 30,287 |
| 47,353 |
| 30,961 |
| 33,038 |
| 141,640 |
|
| 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 |
| 2015 | 15,920 |
| — |
| — |
| — |
| 15,920 |
|
| 2014 | 17,390 |
| 16,777 |
| 16,883 |
| 16,695 |
| 67,746 |
|
| 2013 | 12,032 |
| 30,066 |
| 13,536 |
| 12,127 |
| 67,760 |
|
| 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 |
| 2015 | 10,971 |
| 11,075 |
| 12,407 |
| 12,749 |
| 47,202 |
|
| 2014 | 8,886 |
| 9,099 |
| 10,442 |
| 11,237 |
| 39,663 |
|
| 2013 | 5,930 |
| 10,025 |
| 7,334 |
| 7,330 |
| 30,619 |
|
| 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 |
| 2015 | 6,596 |
| 7,419 |
| 7,898 |
| 8,753 |
| 30,666 |
|
| 2014 | 3,375 |
| 4,385 |
| 5,157 |
| 5,850 |
| 18,767 |
|
| 2013 | 340 |
| 1,414 |
| 748 |
| 879 |
| 3,381 |
|
| 2012 | — |
| — |
| 58 |
| 250 |
| 308 |
|
PDL BioPharma, Inc.
Q4 2015
February 22, 2016
|
| | | | | | | | | | |
| Queen et al. Royalties |
| Royalty Revenue by Product ($ in 000's) * |
| Kadcyla | Q1 | Q2 | Q3 | Q4 | Total |
| 2015 | 3,852 |
| 4,177 |
| 4,319 |
| 4,535 |
| 16,883 |
|
| 2014 | 1,934 |
| 2,491 |
| 3,048 |
| 3,464 |
| 10,937 |
|
| 2013 | — |
| 551 |
| 830 |
| 859 |
| 2,240 |
|
| Tysabri | Q1 | Q2 | Q3 | Q4 | Total |
| 2015 | 14,385 |
| 13,614 |
| 13,557 |
| 14,031 |
| 55,587 |
|
| 2014 | 12,857 |
| 13,350 |
| 16,048 |
| 15,015 |
| 57,270 |
|
| 2013 | 12,965 |
| 13,616 |
| 11,622 |
| 12,100 |
| 50,304 |
|
| 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 |
| 2015 | 4,990 |
| — |
| — |
| — |
| 4,990 |
|
| 2014 | 3,446 |
| 3,932 |
| 4,419 |
| 5,406 |
| 17,202 |
|
| 2013 | 2,631 |
| 2,816 |
| 2,939 |
| 3,744 |
| 12,131 |
|
| 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 |
|
| Gazyva | Q1 | Q2 | Q3 | Q4 | Total |
| 2015 | 313 |
| — |
| — |
| — |
| 313 |
|
| 2014 | 51 |
| 283 |
| 325 |
| 436 |
| 1,094 |
|
| Entyvio | Q1 | Q2 | Q3 | Q4 | Total |
| 2015 | 2,223 |
| — |
| — |
| — |
| 2,223 |
|
| 2014 | — |
| — |
| 153 |
| 2,192 |
| 2,344 |
|
| * As reported to PDL by its licensees. Totals may not sum due to rounding. |
| Q1 2014 royalty revenue by product above do not include a $5 million payment received from Genentech in Q1 2014 for a retroactive settlement payment from 2013. |
PDL BioPharma, Inc.
Q4 2015
February 22, 2016
|
| | | | | | | | | | |
| Queen et al. Sales Revenue |
| Reported Licensee Net Sales Revenue by Product ($ in 000's) * |
| Avastin | Q1 | Q2 | Q3 | Q4 | Total |
| 2015 | 1,826,289 |
| 1,809,286 |
| 1,848,655 |
| 1,881,743 |
| 7,365,972 |
|
| 2014 | 1,786,912 |
| 1,838,764 |
| 1,828,900 |
| 1,916,353 |
| 7,370,929 |
|
| 2013 | 1,653,108 |
| 1,694,678 |
| 1,746,135 |
| 1,819,877 |
| 6,913,798 |
|
| 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 |
| 2015 | 1,789,404 |
| 1,857,696 |
| 1,856,803 |
| 1,830,424 |
| 7,334,326 |
|
| 2014 | 1,731,564 |
| 1,801,990 |
| 1,854,452 |
| 1,877,614 |
| 7,265,621 |
|
| 2013 | 1,681,574 |
| 1,744,145 |
| 1,681,860 |
| 1,726,551 |
| 6,834,130 |
|
| 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 |
| 2015 | 749,182 |
| — |
| — |
| — |
| 749,182 |
|
| 2014 | 818,376 |
| 789,483 |
| 794,505 |
| 785,669 |
| 3,188,031 |
|
| 2013 | 1,203,179 |
| 1,171,423 |
| 1,200,791 |
| 1,212,651 |
| 4,788,045 |
|
| 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 |
| 2015 | 523,340 |
| 521,192 |
| 583,856 |
| 599,945 |
| 2,228,333 |
|
| 2014 | 425,243 |
| 428,171 |
| 491,372 |
| 521,726 |
| 1,866,512 |
|
| 2013 | 341,309 |
| 365,778 |
| 391,900 |
| 401,333 |
| 1,500,321 |
|
| 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 |
| 2015 | 310,410 |
| 349,125 |
| 371,668 |
| 411,912 |
| 1,443,115 |
|
| 2014 | 158,809 |
| 206,333 |
| 242,700 |
| 275,311 |
| 883,153 |
|
| 2013 | 34,008 |
| 55,076 |
| 66,353 |
| 87,949 |
| 243,386 |
|
| 2012 | — |
| — |
| 5,080 |
| 25,000 |
| 30,079 |
|
PDL BioPharma, Inc.
Q4 2015
February 22, 2016
|
| | | | | | | | | | |
| Queen et al. Sales Revenue |
| Reported Licensee Net Sales Revenue by Product ($ in 000's) * |
| Kadcyla | Q1 | Q2 | Q3 | Q4 | Total |
| 2015 | 181,275 |
| 196,556 |
| 203,258 |
| 213,404 |
| 794,493 |
|
| 2014 | 91,031 |
| 117,212 |
| 143,414 |
| 163,028 |
| 514,685 |
|
| 2013 | — |
| 21,459 |
| 73,626 |
| 85,906 |
| 180,991 |
|
| Tysabri | Q1 | Q2 | Q3 | Q4 | Total |
| 2015 | 479,526 |
| 453,786 |
| 451,898 |
| 467,735 |
| 1,852,945 |
|
| 2014 | 428,561 |
| 442,492 |
| 534,946 |
| 500,511 |
| 1,906,510 |
|
| 2013 | 434,677 |
| 451,358 |
| 387,407 |
| 403,334 |
| 1,676,776 |
|
| 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 |
| 2015 | 166,338 |
| — |
| — |
| — |
| 166,338 |
|
| 2014 | 114,865 |
| 124,736 |
| 147,285 |
| 180,197 |
| 567,082 |
|
| 2013 | 87,703 |
| 91,374 |
| 97,961 |
| 124,815 |
| 401,852 |
|
| 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 |
|
| Gazyva | Q1 | Q2 | Q3 | Q4 | Total |
| 2015 | 9,627 |
| — |
| — |
| — |
| 9,627 |
|
| 2014 | 3,095 |
| 8,697 |
| 11,531 |
| 13,428 |
| 36,750 |
|
| Entyvio | Q1 | Q2 | Q3 | Q4 | Total |
| 2015 | 59,287 |
| — |
| — |
| — |
| 59,287 |
|
| 2014 | — |
| — |
| 5,347 |
| 58,500 |
| 63,848 |
|
| * 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. | |
