REDWOOD CITY, Calif., Nov. 8 /PRNewswire-FirstCall/ -- PDL BioPharma, Inc. (PDL) today reported financial results for the quarter ended September 30, 2007.
"We reported a solid third quarter as a result of continued year-over-year revenue growth from our royalties and commercial products," said Pat Gage, Ph.D., interim chief executive officer, PDL. "We continue to advance our development programs in oncology and select immunological diseases and support our commercial efforts, while we actively pursue the sale of the entire company or of our key assets in connection with the strategic decisions made this past quarter."
Revenues
Total revenues consist of product sales, royalties and license, collaboration and other revenues.
Costs and Expenses
For the third quarter of 2007, total costs and expenses were $118.1 million, compared with $119.3 million in the third quarter of 2006. On a non-GAAP basis, total costs and expenses for the third quarter were $90.8 million compared to $84.9 million for the same period in the prior year.
During the third quarter, the company incurred restructuring charges of $4.5 million, of which $3.3 million was related to severance payments and other employee-related costs associated with the company's recent workforce reduction of 104 positions at the company's manufacturing facility. The remaining $1.2 million in restructuring charges were charges related to the company's vacating two leased buildings at its prior headquarters during the third quarter.
Strategic Developments
During the third quarter, PDL announced that, as a result of the company's ongoing evaluation of strategic alternatives, its board of directors has decided to actively seek offers for the sale of the company as a whole or of its key assets. This process is in addition to the company's previously announced plan to sell its commercial assets, including its Cardene, Retavase and IV Busulfex products, as well as the ularitide development-stage cardiovascular product. As a result, the company has suspended its 2007 guidance. The goal of maximizing stockholder value will drive any decisions the company makes regarding specific deal structures or transactions. PDL does not intend to disclose further information regarding the status of its strategic transaction efforts until it enters into a definitive agreement with respect to a strategic transaction, or until the process otherwise has been completed.
Additional developments during the quarter include the election of Karen A. Dawes as chairperson of the board and the appointment of L. Patrick Gage, Ph.D., as interim chief executive officer.
Non-GAAP Financial Information
The non-GAAP financial measures in this press release exclude depreciation of property and equipment, stock-based compensation expense, amortization of intangible assets, asset impairment charges, restructuring charges, interest income and other, net, interest expense, income taxes and certain other items that would otherwise be included if measured in accordance with generally accepted accounting principles (GAAP). PDL believes that the non-GAAP financial measures presented in this press release are useful for investors because these measures provide added insight into PDL's performance by focusing on results generated by its ongoing operations. In addition, PDL uses these non-GAAP financial measures when assessing the performance of its ongoing operations, in making resource allocation decisions and for planning and forecasting. PDL also considers these non-GAAP results in awarding bonus and other incentive compensation to its employees, including management. The non-GAAP financial measures should be considered as a supplement to, not as a substitute for, or superior to, the measures of financial performance prepared in accordance with GAAP. A description of the non-GAAP financial measures for the periods presented and a reconciliation of this information to the GAAP financial measures are included in the attached financial tables.
Forward-looking Statements
This press release contains forward-looking statements which involve risks and uncertainties and PDL's actual results may differ materially from those, express or implied, in the forward-looking statements. Factors that may cause PDL's actual results to differ materially from those expressed or implied in the forward-looking statements in this press release include the actual outcome of PDL's development efforts and the timing of clinical events, as well as those discussed in PDL's filings with the Securities and Exchange Commission (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 http://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 press release are qualified in their entirety by this cautionary statement.
About PDL BioPharma
PDL BioPharma, Inc. is a biopharmaceutical company focused on the discovery and development of novel antibodies in oncology and select immunological diseases. For more information, please visit http://www.pdl.com.
NOTE: PDL BioPharma and the PDL BioPharma logo are considered trademarks and Cardene, Busulfex and Nuvion are registered U.S. trademarks of PDL BioPharma, Inc.; PDL BioPharma, Inc. has a license from Centocor, Inc. to use the trademark Retavase, which is a registered U.S. trademark.
In addition to the consolidated financial statements presented in accordance with GAAP, PDL uses non-GAAP measures of operating performance, which are adjusted from results based on GAAP to exclude depreciation of property and equipment; stock-based compensation expense; amortization of intangible assets; interest income and other, net; interest expense; income taxes and certain other miscellaneous items. PDL believes that the non-GAAP results provide added insight into its performance by focusing on results generated by its ongoing operations. PDL uses the non-GAAP results when assessing the performance of its ongoing operations, in making resource allocation decisions and for planning and forecasting. Additionally, PDL considers these non-GAAP results in awarding bonus and other incentive compensation to its employees, including management. The non-GAAP financial measures should be considered as a supplement to, not as a substitute for, or superior to, the measures of financial performance prepared in accordance with GAAP. Investors are encouraged to review the reconciliation of the non-GAAP financial measures to their most directly comparable GAAP financial measures.
CONTACT: Ami Knoefler, Corporate and Investor Relations, +1-650-454-2331,
ami.knoefler@pdl.com, or Jean Suzuki, Investor Relations, +1-650-454-2648,
jean.suzuki@pdl.com, both of PDL BioPharma, Inc.
Web site: http://www.pdl.com/
