PDL BioPharma Inc.
) posted first-quarter 2013 earnings of 36 cents per share, below
the Zacks Consensus Estimate of 38 cents but ahead of the
year-ago figure of 29 cents per share. The increase in
year-over-year earnings was attributable to higher revenues.
PDL BioPharma generated first-quarter 2013 revenues of $91.8
million, up 18.8% year over year. Revenues were in line with the
company's guidance announced in Mar 2013. Revenues were ahead of
the Zacks Consensus Estimate of $90 million.
Quarter in Detail
PDL BioPharma derived revenues for the first quarter of 2013
solely from royalties. PDL BioPharma receives royalties from
Roche Holdings Ltd.
). The royalties are earned on worldwide net sales of products
like Avastin, Herceptin, Lucentis, Xolair, Tysabri and
Increased royalties on sales of Avastin, Herceptin, Lucentis,
Tysabri and Actemra drove first-quarter 2013 royalties.
Effective from the second quarter of 2011, PDL BioPharma
started paying back a portion of the royalties it receives on
Lucentis sales outside the US to Novartis. The payment is made in
accordance with a settlement agreement, which the companies had
entered into in Feb 2011. The first-quarter 2013 revenue is net
of this payment.
General and administrative (G&A) expenses were $7.2
million in the reported quarter, up approximately 3.5%.
The company is expected to provide revenue guidance for the
second quarter of 2013 in early June this year.
We note that in Apr 2013, PDL BioPharma entered into a credit
agreement with Avinger Inc. PDL BioPharma paid $20 million in
cash on Apr 18, 2013 and is expected to provide additional funds
of around $20 million on achieving certain specified revenue
milestones. As per the agreement PDL BioPharma will be receiving
interest on the principal amount outstanding along with a low,
single-digit royalty on the sale of Avinger's suite of products
till Apr 2018.
PDL BioPharma currently carries a Zacks Rank #3 (Hold).
) seems to be more favourably placed. The stock carries a Zacks
Rank #1 (Strong Buy).
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