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ý
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from to
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Delaware
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94-3023969
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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Title of Class
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Name of Exchange on which Registered
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Common Stock, par value $0.01 per share
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The NASDAQ Stock Market LLC
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Large accelerated filer
ý
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Accelerated filer
¨
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Non-accelerated filer
¨
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Smaller reporting company
¨
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(Do not check if a smaller reporting company)
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PART I
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Item 1
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Item 1A
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Item 1B
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Item 2
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Item 3
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Item 4
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PART II
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Item 5
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Item 6
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Item 7
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Item 7A
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Item 8
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Item 9
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Item 9A
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Item 9B
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PART III
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Item 10
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Item 11
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Item 12
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Item 13
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Item 14
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PART IV
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Item 15
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•
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treatment of adult patients with T315I-positive chronic myeloid leukemia (chronic phase, accelerated phase, or blast phase) or T315I-positive Philadelphia chromosome positive acutelymphoblastic leukemia (Ph+ ALL), and
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•
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treatment of adult patients with chronic phase, accelerated phase, or blast phase chronic myeloid leukemia or Ph+ ALL for whom no other tyrosine kinase inhibitor (TKI) therapy is indicated.
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Licensee
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Product Names
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Genentech
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Avastin
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Herceptin
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Xolair
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Lucentis
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Perjeta
®
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Kadcyla
®
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Biogen
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Tysabri
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•
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we may be unable to acquire income generating assets and products on terms that would allow us to make an appropriate level of return from the asset;
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•
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our products and asset investments may be less successful in the marketplace than may be necessary to generate an appropriate level of return from the asset; or
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•
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we may be forced to undertake more risk in obtaining the assets we pursue.
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•
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the clinical indications for which the product is approved and the labeling required by regulatory authorities for use with the product, including any warnings that may be required in the labeling;
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•
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acceptance by physicians and patients of the product as a safe and effective treatment;
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•
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the cost, safety, efficacy and convenience of treatment in relation to alternative treatments;
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•
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the restrictions on the use of our products together with other medications;
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•
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the manufacture of good manufacturing practices compliant active pharmaceutical ingredient (“API”) and finished product in sufficient quantities and in a timely manner;
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•
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the availability of adequate coverage and reimbursement or pricing by third party payors and government authorities; and
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•
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the effectiveness of sales and marketing efforts.
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•
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international regulatory requirements for drug marketing and pricing in foreign countries;
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•
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varied standards of care in various countries that could complicate the commercial success of products;
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•
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varied drug import and export rules;
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•
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varying standards for the protection of intellectual property rights which may result in reduced or compromised exclusivity in certain countries;
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•
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unexpected changes in tariffs, trade barriers and regulatory requirements;
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•
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varied reimbursement systems and different competitive drugs indicated to treat the indications for which Noden Products are being commercialized;
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•
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economic weakness, including inflation, or political instability in particular foreign economies and markets;
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•
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compliance with tax, employment, immigration and labor laws applicable to foreign operations;
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•
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compliance with the U.S. Foreign Corrupt Practices Act (“FCPA”), the UK Bribery Act, and other anti-corruption and anti-bribery laws;
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•
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foreign taxes and duties;
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•
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foreign currency fluctuations and other obligations incident to doing business in another country;
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•
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workforce uncertainty in countries where labor unrest is more common than in the United States;
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•
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reliance on management, contract services organizations and other third parties that may be less experienced with manufacturing and commercialization than the party from whom the Noden Products were acquired;
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•
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potential liability resulting from product liability laws or the activities of foreign distributors; and
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•
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business interruptions resulting from geopolitical actions, including war and terrorism, or natural disasters.
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•
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the timing and availability of generic product competition for our products, and our licensees’, borrowers’ and royalty-agreement counterparties’ products;
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•
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potential challenges or design arounds to product, use or manufacturing related patents which provide exclusivity for products and assets before their expiration by generic pharmaceutical manufacturers;
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•
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the size of the market for our products, and our licensees’, borrowers’ and royalty-agreement counterparties’ products;
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•
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the extent and effectiveness of the sales and marketing and distribution support our licensees’, borrowers’ and royalty-agreement counterparties’ products and the implementation of a new sales force and commercial infrastructure with commercial experience in connection with the commercialization of our products;
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•
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the existence of novel or superior products to our products, or our licensees’, borrowers’ and royalty-agreement counterparties’ products;
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•
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the availability of reduced pricing and discounts applicable to our licensees’, borrowers’ and royalty-agreement counterparties’ products;
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•
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stocking and inventory management practices related to our products or our licensees’, borrowers’ and royalty-agreement counterparties’ products;
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•
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limitations on indications for which our products or our licensees’, borrowers’ and royalty-agreement counterparties’ products can be marketed; the competitive landscape for approved products and developing therapies that compete with our products or our licensees’, borrowers’ and royalty-agreement counterparties’ products;
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•
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the ability of patients to be able to afford our products, or our licensees’, borrowers’ and royalty-agreement counterparties’ products or obtain health care coverage that covers those products;
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•
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acceptance of, and ongoing satisfaction with, our products and our licensees’, borrowers’ and royalty-agreement counterparties’ products by the care providers, patients receiving therapy and third party payors; or
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•
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the unfavorable outcome of any potential litigation relating to our products and our licensees’, borrowers’ and royalty-agreement counterparties’ products.
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•
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inability to identify and enter into a manufacturing and supply agreement with a third party manufacturer having the appropriate capabilities to cost-effectively and timely manufacture products at the sales levels that we anticipate;
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inability of any third party manufacturer to qualify or maintain qualification to manufacture in accordance with applicable regulatory requirements, including cGMP and ICH requirements;
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•
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reduced control and additional burdens of oversight as a result of using third party manufacturers for all aspects of manufacturing activities, including regulatory compliance and quality control and assurance;
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•
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termination or non-renewal of manufacturing and supply agreements with third parties in a manner or at a time that may negatively impact commercialization activities; and
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•
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disruption in the operations of third party manufacturers or suppliers unrelated to our products, including the bankruptcy of the manufacturer or supplier or a catastrophic event affecting the third manufacturers or suppliers.
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•
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an annual, non-tax deductible fee payable by any entity that manufactures or imports specified branded prescription drugs payable to the federal government based on each company’s market share of prior year total sales of branded products to certain federal healthcare programs;
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•
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an increase in the statutory minimum rebates a manufacturer must pay under the Medicaid Drug Rebate Program;
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•
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a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or injected;
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•
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extension of manufacturers’ Medicaid rebate liability to individuals enrolled in Medicaid managed care organizations;
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•
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expansion of eligibility criteria for Medicaid programs in certain states;
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•
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a new Medicare Part D coverage gap discount program, in which manufacturers must agree to offer 50% point-of-sale discounts off negotiated prices of applicable brand drugs to eligible beneficiaries under their coverage gap period, as a condition for the manufacturer’s outpatient drugs to be covered under Medicare Part D;
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•
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expansion of the entities eligible for discounts under the Public Health Service pharmaceutical pricing program;
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•
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a new requirement to annually report drug samples that manufacturers and distributors provide to physicians; and
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•
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a new Patient-Centered Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with funding for such research.
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•
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regulatory authorities may withdraw approvals of such product;
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•
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regulatory authorities may require additional warnings on the label;
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•
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we may be required to create a medication guide outlining the risks of such side effects for distribution to patients;
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•
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we could be sued and held liable for harm caused to patients; and
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•
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our reputation may suffer.
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•
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comply with FDA regulations or similar regulations of comparable foreign regulatory authorities;
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•
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provide accurate information to the FDA or comparable foreign regulatory authorities;
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•
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comply with manufacturing standards applicable to our products;
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•
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comply with federal and state healthcare fraud and abuse laws and regulations and similar laws and regulations established and enforced by comparable foreign regulatory authorities;
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•
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comply with the FCPA, the UK Bribery Act, and other anti-bribery laws;
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report financial information or data and our business affairs accurately;
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•
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or disclose unauthorized activities to us.
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•
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the federal Anti-Kickback Statute, which prohibits, among other things, persons from knowingly and willfully soliciting, receiving, offering or paying remuneration, directly or indirectly, to induce, or in return for, the purchase or
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•
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federal civil and criminal false claims laws and civil monetary penalty laws, which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, claims for payment from Medicare, Medicaid, or other third party payors that are false or fraudulent;
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•
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The Health Insurance Protability and Accountability Act of 1996 (“HIPAA”), which created new federal criminal statutes that prohibit executing a scheme to defraud any healthcare benefit program and making false statements relating to healthcare matters;
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•
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HIPAA, as amended by the Health Information for Economic and Clinical Health Act of 2009 (“HITECH”), and its implementing regulations, which imposes certain requirements relating to the privacy, security, and transmission of individually identifiable health information;
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•
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the federal physician sunshine requirements under the Patient Protection and Affordable Care Act (“PPACA”), which requires manufacturers of drugs, devices, biologics, and medical supplies to report annually to the Centers for Medicare and Medicaid Services (“CMS”), information related to payments and other transfers of value to physicians, other healthcare providers, and teaching hospitals, and ownership and investment interests held by physicians and other healthcare providers and their immediate family members;
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•
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guidelines promulgated by the Office of Inspector General of the U.S. Department of Health and Human Services related to pharmaceutical company regulatory compliance programs and the PhRMA Code on Interactions with Healthcare Professionals, as amended;
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•
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foreign and state law equivalents of each of the above federal laws, such as the FCPA, anti-kickback and false claims laws that may apply to items or services reimbursed by any third party payor, including commercial insurers;
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•
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state laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the applicable compliance guidance promulgated by the federal government, or otherwise restrict payments that may be made to healthcare providers and other potential referral sources;
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•
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state laws that require drug manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures; and
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•
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state laws governing the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways, thus complicating compliance efforts.
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•
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expect to purchase our common stock in the open market and/or enter into various derivatives and/or enter into various derivative transactions with respect to our common stock; and
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•
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may enter into or unwind various derivatives and/or purchase or sell our common stock in secondary market transactions.
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•
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not be engaged or hold itself out as being engaged primarily in the business of investing, reinvesting or trading in securities and not own or propose to acquire “investment securities” with a value of more than 40% of the value of its total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis; or
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•
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be able to rely on an exception from the definition of “investment company” under the ’40 Act or an exemptive rule.
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High
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Low
|
||||
2016
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|
|
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||||
First Quarter
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$
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3.57
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$
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2.58
|
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Second Quarter
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$
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3.84
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$
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2.94
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Third Quarter
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$
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3.62
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$
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2.69
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Fourth Quarter
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$
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3.77
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$
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1.93
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2015
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First Quarter
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$
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7.88
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$
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6.52
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Second Quarter
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$
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7.42
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$
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6.18
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Third Quarter
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$
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6.63
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$
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4.58
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Fourth Quarter
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$
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5.35
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$
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3.29
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12/31/2011
|
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12/31/2012
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12/31/2013
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12/31/2014
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12/31/2015
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12/31/2016
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||||||||||||
PDL BioPharma, Inc.
|
$
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100.00
|
|
|
$
|
123.80
|
|
|
$
|
160.11
|
|
|
$
|
156.40
|
|
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$
|
80.38
|
|
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$
|
49.61
|
|
NASDAQ Biotechnology Index
|
$
|
100.00
|
|
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$
|
134.68
|
|
|
$
|
232.37
|
|
|
$
|
307.67
|
|
|
$
|
328.76
|
|
|
$
|
262.08
|
|
NASDAQ Composite Index
|
$
|
100.00
|
|
|
$
|
116.41
|
|
|
$
|
165.47
|
|
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$
|
188.69
|
|
|
$
|
200.32
|
|
|
$
|
216.54
|
|
|
|
For the Years Ended December 31,
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||||||||||||||||||
(In thousands, except per share data)
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
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|
||||||||||
Royalties from Queen et al. patents
|
|
$
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166,158
|
|
|
$
|
485,156
|
|
|
$
|
486,888
|
|
|
$
|
430,219
|
|
|
$
|
374,525
|
|
Royalty rights - change in fair value
|
|
16,196
|
|
|
68,367
|
|
|
45,742
|
|
|
5,565
|
|
|
—
|
|
|||||
Interest revenue
|
|
30,404
|
|
|
36,202
|
|
|
48,020
|
|
|
18,976
|
|
|
6,355
|
|
|||||
Product revenue, net
|
|
31,669
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
License and other
|
|
(126
|
)
|
|
723
|
|
|
575
|
|
|
1,500
|
|
|
—
|
|
|||||
Total revenues
|
|
244,301
|
|
|
590,448
|
|
|
581,225
|
|
|
456,260
|
|
|
380,880
|
|
|||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cost of product revenue, (excluding intangible amortization)
|
|
4,065
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Amortization of intangible assets
|
|
12,028
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
General and administrative expenses
|
|
39,790
|
|
|
36,090
|
|
|
34,914
|
|
|
29,755
|
|
|
25,469
|
|
|||||
Sales and marketing
|
|
538
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Research and development
|
|
3,820
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Change in fair value of anniversary payment and contingent consideration
|
|
(3,716
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Acquisition-related costs
|
|
3,564
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Loss on extinguishment of notes receivable
|
|
51,075
|
|
|
3,979
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Asset impairment loss
|
|
3,735
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total operating expenses
|
|
114,899
|
|
|
40,069
|
|
|
34,914
|
|
|
29,755
|
|
|
25,469
|
|
|||||
Operating income
|
|
129,402
|
|
|
550,379
|
|
|
546,311
|
|
|
426,505
|
|
|
355,411
|
|
|||||
Non-operating expense, net
|
|
(20,032
|
)
|
|
(20,241
|
)
|
|
(45,039
|
)
|
|
(24,629
|
)
|
|
(28,278
|
)
|
|||||
Income before income taxes
|
|
109,370
|
|
|
530,138
|
|
|
501,272
|
|
|
401,876
|
|
|
327,133
|
|
|||||
Income tax expense
|
|
45,711
|
|
|
197,343
|
|
|
179,028
|
|
|
137,346
|
|
|
115,464
|
|
|||||
Net income
|
|
63,659
|
|
|
332,795
|
|
|
322,244
|
|
|
264,530
|
|
|
211,669
|
|
|||||
Less: Net income attributable to noncontrolling interests
|
|
53
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net income attributable to PDL’s shareholders
|
|
$
|
63,606
|
|
|
$
|
332,795
|
|
|
$
|
322,244
|
|
|
$
|
264,530
|
|
|
$
|
211,669
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income per basic share:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income
|
|
$
|
0.39
|
|
|
$
|
2.04
|
|
|
$
|
2.04
|
|
|
$
|
1.89
|
|
|
$
|
1.52
|
|
Net income per diluted share:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income
|
|
$
|
0.39
|
|
|
$
|
2.03
|
|
|
$
|
1.86
|
|
|
$
|
1.66
|
|
|
$
|
1.45
|
|
Dividends per share:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash dividends declared and paid
|
|
$
|
0.10
|
|
|
$
|
0.60
|
|
|
$
|
0.60
|
|
|
$
|
0.60
|
|
|
$
|
0.60
|
|
|
|
December 31,
|
||||||||||||||||||
(In thousands)
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
||||||||||
Cash, cash equivalents, investments and restricted investments
|
|
$
|
242,141
|
|
|
$
|
220,352
|
|
|
$
|
293,687
|
|
|
$
|
99,540
|
|
|
$
|
168,689
|
|
Working capital
|
|
$
|
267,716
|
|
|
$
|
245,969
|
|
|
$
|
167,914
|
|
|
$
|
(299,727
|
)
|
|
$
|
172,511
|
|
Total assets
1
|
|
$
|
1,215,387
|
|
|
$
|
1,012,205
|
|
|
$
|
954,946
|
|
|
$
|
540,858
|
|
|
$
|
277,024
|
|
Long-term obligations, less current portion
1
|
|
$
|
329,649
|
|
|
$
|
279,512
|
|
|
$
|
306,977
|
|
|
$
|
23,042
|
|
|
$
|
334,672
|
|
Retained earnings
|
|
$
|
857,116
|
|
|
$
|
810,036
|
|
|
$
|
575,740
|
|
|
$
|
350,151
|
|
|
$
|
169,634
|
|
Total stockholders’ equity (deficit)
|
|
$
|
755,423
|
|
|
$
|
695,952
|
|
|
$
|
460,437
|
|
|
$
|
113,489
|
|
|
$
|
(68,122
|
)
|
1
|
In the first quarter of 2016, we adopted Financial Accounting Standards Board (FASB) Accounting Standard Update (ASU) No. 2015-03 (ASU 2015-03), retrospectively as required. See Note 2 of Notes to the Consolidated Financial Statements included in Part II, Item 8, “Financial Statements and Supplementary Data” for more information on the adoption of ASU 2015-03.
|
•
|
Our net income for the years ended
December 31, 2016
,
2015
and
2014
was
$63.6 million
,
$332.8 million
and
$322.2 million
, respectively;
|
•
|
At
December 31, 2016
, we had cash, cash equivalents and investments of
$242.1 million
as compared with
$220.4 million
at
December 31, 2015
; and
|
•
|
At
December 31, 2016
, we had
$460.0 million
in total liabilities as compared with
$316.3 million
at
December 31, 2015
.
|
(Dollars in thousands)
|
|
2016
|
|
2015
|
|
Change from
Prior Year %
|
|
2014
|
|
Change from
Prior Year %
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Royalties from Queen et al. patents
|
|
$
|
166,158
|
|
|
$
|
485,156
|
|
|
(66
|
)%
|
|
$
|
486,888
|
|
|
N/M
|
|
Royalty rights - change in fair value
|
|
16,196
|
|
|
68,367
|
|
|
(76
|
)%
|
|
45,742
|
|
|
49
|
%
|
|||
Interest revenue
|
|
30,404
|
|
|
36,202
|
|
|
(16
|
)%
|
|
48,020
|
|
|
(25
|
)%
|
|||
Product revenue, net
|
|
31,669
|
|
|
—
|
|
|
N/M
|
|
|
—
|
|
|
—
|
%
|
|||
License and other
|
|
(126
|
)
|
|
723
|
|
|
(117
|
)%
|
|
575
|
|
|
26
|
%
|
|||
Total revenues
|
|
$
|
244,301
|
|
|
$
|
590,448
|
|
|
(59
|
)%
|
|
$
|
581,225
|
|
|
2
|
%
|
(in thousands)
|
|
Discount and Distribution Fees
|
|
Government Rebates and Chargebacks
|
|
Assistance and Other Discounts
|
|
Product Return
|
|
Total
|
||||||||||
Balance at October 1, 2016:
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Allowances for current period sales
|
|
2,754
|
|
|
5,514
|
|
|
2,580
|
|
|
1,769
|
|
|
12,617
|
|
|||||
Allowances for prior period sales
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Credits/payments for current period sales
|
|
(279
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(279
|
)
|
|||||
Credits/payments for prior period sales
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Balance at December 31, 2016
|
|
$
|
2,475
|
|
|
$
|
5,514
|
|
|
$
|
2,580
|
|
|
$
|
1,769
|
|
|
$
|
12,338
|
|
|
|
|
|
Change in
|
|
Royalty Rights -
|
||||||
(in thousands)
|
|
Cash Royalties
|
|
Fair Value
|
|
Change in Fair Value
|
||||||
Depomed
|
|
$
|
59,342
|
|
|
$
|
(27,796
|
)
|
|
$
|
31,546
|
|
VB
|
|
1,468
|
|
|
(2,135
|
)
|
|
(667
|
)
|
|||
U-M
|
|
3,013
|
|
|
(34,799
|
)
|
|
(31,786
|
)
|
|||
ARIAD
|
|
7,508
|
|
|
8,590
|
|
|
16,098
|
|
|||
AcelRx
|
|
8
|
|
|
46
|
|
|
54
|
|
|||
Avinger
|
|
1,220
|
|
|
(905
|
)
|
|
315
|
|
|||
KYBELLA
|
|
23
|
|
|
613
|
|
|
636
|
|
|||
|
|
$
|
72,582
|
|
|
$
|
(56,386
|
)
|
|
$
|
16,196
|
|
•
|
Reported net sales of Avastin were flat compared to the same period for the prior year.
|
•
|
Reported net sales of Herceptin increased $0.1 billion or 1% compared to the same period for the prior year.
|
•
|
Reported Lucentis net sales decreased $2.4 billion or 77% compared to the same period for the prior year.
|
•
|
Reported Xolair net sales increased $0.4 billion or 19% compared to the same period for the prior year.
|
•
|
Reported Kadcyla net sales increased $0.3 billion or 54% compared to the same period for the prior year.
|
•
|
Reported Perjeta net sales increased $0.6 billion or 63% compared to the same period for the prior year.
|
|
|
|
|
Year Ended December 31,
|
|||||||
Licensee
|
|
Product Name
|
|
2016
|
|
2015
|
|
2014
|
|||
Genentech
|
|
Avastin
|
|
16
|
%
|
|
27
|
%
|
|
27
|
%
|
|
|
Herceptin
|
|
16
|
%
|
|
26
|
%
|
|
27
|
%
|
|
|
|
|
|
|
|
|
|
|||
Biogen
|
|
Tysabri
|
|
24
|
%
|
|
9
|
%
|
|
10
|
%
|
|
|
|
|
|
|
|
|
|
|||
Depomed
|
|
Glumetza, Janumet XR, Jentadueto XR and Invokamet XR
|
|
13
|
%
|
|
9
|
%
|
|
7
|
%
|
|
|
|
|
|
|
|
|
|
|||
Noden
|
|
Tekturna, Tekturna HCT, Rasilez and Rasilez HCT
|
|
13
|
%
|
|
—
|
%
|
|
—
|
%
|
(Dollars in thousands, except for percentages)
|
|
2016
|
|
2015
|
|
Change from Prior Year %
|
|
2014
|
|
Change from Prior Year %
|
||||||||
Costs of product revenue
|
|
$
|
4,065
|
|
|
$
|
—
|
|
|
N/M
|
|
|
$
|
—
|
|
|
0
|
%
|
Amortization of intangible assets
|
|
12,028
|
|
|
—
|
|
|
N/M
|
|
|
—
|
|
|
0
|
%
|
|||
General and administrative
|
|
39,790
|
|
|
36,090
|
|
|
10
|
%
|
|
34,914
|
|
|
3
|
%
|
|||
Sales and marketing
|
|
538
|
|
|
—
|
|
|
N/M
|
|
|
—
|
|
|
0
|
%
|
|||
Research and development
|
|
3,820
|
|
|
—
|
|
|
N/M
|
|
|
—
|
|
|
0
|
%
|
|||
Change in fair value of anniversary payment and contingent consideration
|
|
(3,716
|
)
|
|
—
|
|
|
N/M
|
|
|
—
|
|
|
0
|
%
|
|||
Asset impairment loss
|
|
3,735
|
|
|
—
|
|
|
N/M
|
|
|
—
|
|
|
0
|
%
|
|||
Acquisition-related costs
|
|
3,564
|
|
|
—
|
|
|
N/M
|
|
|
—
|
|
|
0
|
%
|
|||
Loss on extinguishment of notes receivable
|
|
51,075
|
|
|
3,979
|
|
|
1,184
|
%
|
|
—
|
|
|
N/M
|
|
|||
Total operating expenses
|
|
$
|
114,899
|
|
|
$
|
40,069
|
|
|
187
|
%
|
|
$
|
34,914
|
|
|
15
|
%
|
Percentage of total revenues
|
|
47
|
%
|
|
7
|
%
|
|
|
|
6
|
%
|
|
|
(Dollars in thousands)
|
|
2016
|
|
2015
|
|
Change from Prior Year %
|
|
2014
|
|
Change from Prior Year %
|
||||||||
Interest and other income, net
|
|
$
|
588
|
|
|
$
|
368
|
|
|
60
|
%
|
|
$
|
315
|
|
|
17
|
%
|
Interest expense
|
|
(18,267
|
)
|
|
(27,059
|
)
|
|
(32
|
)%
|
|
(39,211
|
)
|
|
(31
|
)%
|
|||
Gain (loss) on extinguishment of debt
|
|
(2,353
|
)
|
|
6,450
|
|
|
(136
|
)%
|
|
(6,143
|
)
|
|
(205
|
)%
|
|||
Total non-operating expense, net
|
|
$
|
(20,032
|
)
|
|
$
|
(20,241
|
)
|
|
(1
|
)%
|
|
$
|
(45,039
|
)
|
|
(55
|
)%
|
|
Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Net income per basic share
|
$
|
0.39
|
|
|
$
|
2.04
|
|
|
$
|
2.04
|
|
Net income per diluted share
|
$
|
0.39
|
|
|
$
|
2.03
|
|
|
$
|
1.86
|
|
|
|
Payments Due by Period
|
||||||||||||||
|
|
Less Than
|
|
|
|
More than
|
|
|
||||||||
(In thousands)
|
|
1 Year
|
|
1-3 Years
|
|
3 Years
|
|
Total
|
||||||||
Operating leases
(1)
|
|
$
|
184
|
|
|
$
|
262
|
|
|
$
|
59
|
|
|
$
|
505
|
|
Convertible notes
(2)
|
|
9,286
|
|
|
139,243
|
|
|
154,125
|
|
|
302,654
|
|
||||
Notes receivable
(3)
|
|
20,000
|
|
|
—
|
|
|
—
|
|
|
20,000
|
|
||||
Royalty rights
(3)
|
|
40,000
|
|
|
—
|
|
|
—
|
|
|
40,000
|
|
||||
Anniversary payment
(4)
|
|
89,000
|
|
|
—
|
|
|
—
|
|
|
89,000
|
|
||||
Inventory
(5)
|
|
10,920
|
|
|
49,666
|
|
|
—
|
|
|
60,586
|
|
||||
Contingent consideration
(4)
|
|
—
|
|
|
55,000
|
|
|
40,000
|
|
|
95,000
|
|
||||
Total contractual obligations
|
|
$
|
169,390
|
|
|
$
|
244,171
|
|
|
$
|
194,184
|
|
|
$
|
607,745
|
|
(In thousands)
|
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
|
Total
|
|
Fair Value
|
|
||||||||||
Convertible notes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed Rate
|
|
$
|
—
|
|
|
$126,447
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$150,000
|
|
$276,447
|
|
$
|
245,981
|
|
(1)
|
||
Average Interest Rate
|
|
3.32
|
%
|
|
2.85
|
%
|
|
2.75
|
%
|
|
2.75
|
%
|
|
2.75
|
%
|
|
|
|
|
|
(1)
|
The fair value of the remaining payments under our February 2018 Notes was estimated based on the trading value of these notes at
December 31, 2016
.
|
Item
|
Page
|
|
|
/s/ PRICEWATERHOUSECOOPERS LLP
|
|
|
December 31,
|
||||||
|
2016
|
|
2015
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
147,154
|
|
|
$
|
218,883
|
|
Short-term investments
|
19,987
|
|
|
1,469
|
|
||
Receivables from licensees and other
|
40,120
|
|
|
—
|
|
||
Deferred tax assets
|
—
|
|
|
981
|
|
||
Notes receivable
|
111,182
|
|
|
58,398
|
|
||
Investments-other
|
75,000
|
|
|
—
|
|
||
Inventory, net
|
2,884
|
|
|
—
|
|
||
Prepaid and other current assets
|
1,704
|
|
|
2,979
|
|
||
Total current assets
|
398,031
|
|
|
282,710
|
|
||
Property and equipment, net
|
38
|
|
|
31
|
|
||
Royalty rights - at fair value
|
402,318
|
|
|
399,204
|
|
||
Notes and other receivables, long-term
|
159,768
|
|
|
306,507
|
|
||
Long-term deferred tax assets
|
19,257
|
|
|
16,172
|
|
||
Intangible assets, net
|
228,542
|
|
|
—
|
|
||
Other assets
|
7,433
|
|
|
7,581
|
|
||
Total assets
|
$
|
1,215,387
|
|
|
$
|
1,012,205
|
|
|
|
|
|
||||
Liabilities and Stockholders’ Equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
7,016
|
|
|
$
|
394
|
|
Accrued liabilities
|
30,575
|
|
|
8,009
|
|
||
Accrued income taxes
|
4,723
|
|
|
3,372
|
|
||
Term loan payable
|
—
|
|
|
24,966
|
|
||
Anniversary payment
|
88,001
|
|
|
—
|
|
||
Total current liabilities
|
130,315
|
|
|
36,741
|
|
||
Convertible notes payable
|
232,443
|
|
|
228,862
|
|
||
Contingent consideration
|
42,650
|
|
|
—
|
|
||
Other long-term liabilities
|
54,556
|
|
|
50,650
|
|
||
Total liabilities
|
459,964
|
|
|
316,253
|
|
||
|
|
|
|
||||
Commitments and contingencies (Note 12)
|
|
|
|
||||
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock, par value $0.01 per share, 10,000 shares authorized; no shares issued and outstanding
|
—
|
|
|
—
|
|
||
Common stock, par value $0.01 per share, 350,000 shares authorized; 165,538 and 164,287 shares issued and outstanding at December 31, 2016 and 2015, respectively
|
1,655
|
|
|
1,643
|
|
||
Additional paid-in capital
|
(107,628
|
)
|
|
(117,983
|
)
|
||
Accumulated other comprehensive income
|
—
|
|
|
2,256
|
|
||
Retained earnings
|
857,116
|
|
|
810,036
|
|
||
Total PDL’s stockholders’ equity
|
751,143
|
|
|
695,952
|
|
||
Noncontrolling interests
|
4,280
|
|
|
—
|
|
||
Total stockholders’ equity
|
755,423
|
|
|
695,952
|
|
||
Total liabilities and stockholders’ equity
|
$
|
1,215,387
|
|
|
$
|
1,012,205
|
|
|
Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Revenues:
|
|
|
|
|
|
||||||
Royalties from Queen et al. patents
|
$
|
166,158
|
|
|
$
|
485,156
|
|
|
$
|
486,888
|
|
Royalty rights - change in fair value
|
16,196
|
|
|
68,367
|
|
|
45,742
|
|
|||
Interest revenue
|
30,404
|
|
|
36,202
|
|
|
48,020
|
|
|||
Product revenue, net
|
31,669
|
|
|
—
|
|
|
—
|
|
|||
License and other
|
(126
|
)
|
|
723
|
|
|
575
|
|
|||
Total revenues
|
244,301
|
|
|
590,448
|
|
|
581,225
|
|
|||
|
|
|
|
|
|
||||||
Operating expenses
|
|
|
|
|
|
||||||
Cost of product revenue, (excluding intangible amortization)
|
4,065
|
|
|
—
|
|
|
—
|
|
|||
Amortization of intangible assets
|
12,028
|
|
|
—
|
|
|
—
|
|
|||
General and administrative
|
39,790
|
|
|
36,090
|
|
|
34,914
|
|
|||
Sales and marketing
|
538
|
|
|
—
|
|
|
—
|
|
|||
Research and development
|
3,820
|
|
|
—
|
|
|
—
|
|
|||
Change in fair value of anniversary payment and contingent consideration
|
(3,716
|
)
|
|
—
|
|
|
—
|
|
|||
Asset impairment loss
|
3,735
|
|
|
—
|
|
|
—
|
|
|||
Acquisition-related costs
|
3,564
|
|
|
—
|
|
|
—
|
|
|||
Loss on extinguishment of notes receivable
|
51,075
|
|
|
3,979
|
|
|
—
|
|
|||
Total operating expenses
|
114,899
|
|
|
40,069
|
|
|
34,914
|
|
|||
Operating income
|
129,402
|
|
|
550,379
|
|
|
546,311
|
|
|||
|
|
|
|
|
|
||||||
Non-operating expense, net
|
|
|
|
|
|
||||||
Interest and other income, net
|
588
|
|
|
368
|
|
|
315
|
|
|||
Interest expense
|
(18,267
|
)
|
|
(27,059
|
)
|
|
(39,211
|
)
|
|||
Gain (loss) on extinguishment of debt
|
(2,353
|
)
|
|
6,450
|
|
|
(6,143
|
)
|
|||
Total non-operating expense, net
|
(20,032
|
)
|
|
(20,241
|
)
|
|
(45,039
|
)
|
|||
|
|
|
|
|
|
||||||
Income before income taxes
|
109,370
|
|
|
530,138
|
|
|
501,272
|
|
|||
Income tax expense
|
45,711
|
|
|
197,343
|
|
|
179,028
|
|
|||
Net income
|
63,659
|
|
|
332,795
|
|
|
322,244
|
|
|||
Less: Net income attributable to noncontrolling interests
|
53
|
|
|
—
|
|
|
—
|
|
|||
Net income attributable to PDL’s shareholders
|
$
|
63,606
|
|
|
$
|
332,795
|
|
|
$
|
322,244
|
|
|
|
|
|
|
|
||||||
Net income per share
|
|
|
|
|
|
||||||
Basic
|
$
|
0.39
|
|
|
$
|
2.04
|
|
|
$
|
2.04
|
|
Diluted
|
$
|
0.39
|
|
|
$
|
2.03
|
|
|
$
|
1.86
|
|
Weighted average shares outstanding
|
|
|
|
|
|
||||||
Basic
|
163,805
|
|
|
163,386
|
|
|
158,224
|
|
|||
Diluted
|
164,192
|
|
|
163,554
|
|
|
173,110
|
|
|||
Cash dividends declared per common share
|
$
|
0.10
|
|
|
$
|
0.60
|
|
|
$
|
0.60
|
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
63,659
|
|
|
$
|
332,795
|
|
|
$
|
322,244
|
|
|
|
|
|
|
|
|
||||||
Other comprehensive income (loss), net of tax
|
|
|
|
|
|
|
|
|
||||
Change in unrealized gains on investments in available-for-sale securities:
|
|
|
|
|
|
|
||||||
Change in fair value of investments in available-for-sale securities, net of tax
|
|
122
|
|
|
783
|
|
|
(745
|
)
|
|||
Adjustment for net (gains) losses realized and included in net income, net of tax
|
|
(557
|
)
|
|
(712
|
)
|
|
(20
|
)
|
|||
Total change in unrealized gains on investments in available-for-sale securities, net of tax
(a)
|
|
(435
|
)
|
|
71
|
|
|
(765
|
)
|
|||
Change in unrealized gains (losses) on cash flow hedges:
|
|
|
|
|
|
|
||||||
Change in fair value of cash flow hedges, net of tax
|
|
—
|
|
|
4,626
|
|
|
4,834
|
|
|||
Adjustment to royalties from Queen et al. patents for net (gains) losses realized and included in net income, net of tax
|
|
(1,821
|
)
|
|
(5,390
|
)
|
|
3,768
|
|
|||
Total change in unrealized losses on cash flow hedges, net of tax
(b)
|
|
(1,821
|
)
|
|
(764
|
)
|
|
8,602
|
|
|||
Total other comprehensive income (loss), net of tax
|
|
(2,256
|
)
|
|
(693
|
)
|
|
7,837
|
|
|||
Comprehensive income
|
|
61,403
|
|
|
332,102
|
|
|
330,081
|
|
|||
Less: Comprehensive income attributable to noncontrolling interests
|
|
53
|
|
|
—
|
|
|
—
|
|
|||
Comprehensive income attributable to PDL’s shareholders
|
|
$
|
61,350
|
|
|
$
|
332,102
|
|
|
$
|
330,081
|
|
|
PDL’s Stockholders Equity
|
|
|
|
|
|||||||||||||||||||||
|
Common Stock
|
|
Additional
Paid-In
Capital
|
|
Retained Earnings
|
|
Accumulated
Other Comprehensive
Income (Loss)
|
|
Non-controlling Interest
|
|
Total
Stockholders’ Equity |
|||||||||||||||
|
Shares
|
|
Amount
|
|
|
|
|
|
||||||||||||||||||
Balance at December 31, 2013
|
139,934,569
|
|
|
$
|
1,399
|
|
|
$
|
(233,173
|
)
|
|
$
|
350,151
|
|
|
$
|
(4,888
|
)
|
|
$
|
—
|
|
|
$
|
113,489
|
|
Issuance of common stock under employee benefit plans
|
148,882
|
|
|
2
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Issuance of common stock for convertible debt
|
22,103,031
|
|
|
221
|
|
|
(221
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Extinguishment of convertible debt
|
—
|
|
|
—
|
|
|
102,134
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
102,134
|
|
||||||
Issuance of convertible debt
|
—
|
|
|
—
|
|
|
18,689
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18,689
|
|
||||||
Purchase of purchased call options, net of tax
|
—
|
|
|
—
|
|
|
(20,118
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(20,118
|
)
|
||||||
Proceeds from the sale of warrants
|
—
|
|
|
—
|
|
|
11,427
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,427
|
|
||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
1,501
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,501
|
|
||||||
Tax benefit from stock options
|
—
|
|
|
—
|
|
|
(111
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(111
|
)
|
||||||
Dividends declared
|
—
|
|
|
—
|
|
|
—
|
|
|
(96,655
|
)
|
|
—
|
|
|
—
|
|
|
(96,655
|
)
|
||||||
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
322,244
|
|
|
—
|
|
|
—
|
|
|
322,244
|
|
||||||
Change in unrealized gains and losses on investments in available-for-sale securities, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(765
|
)
|
|
—
|
|
|
(765
|
)
|
||||||
Changes in unrealized gains and losses on cash flow hedges, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,602
|
|
|
—
|
|
|
8,602
|
|
||||||
Total comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
|
330,081
|
|
||||||||||||
Balance at December 31, 2014
|
162,186,482
|
|
|
1,622
|
|
|
(119,874
|
)
|
|
575,740
|
|
|
2,949
|
|
|
—
|
|
|
460,437
|
|
||||||
Issuance of common stock under employee benefit plans
|
758,533
|
|
|
8
|
|
|
(8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Extinguishment of convertible debt
|
1,341,600
|
|
|
13
|
|
|
87
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
100
|
|
||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
2,045
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,045
|
|
||||||
Tax benefit from stock options
|
—
|
|
|
—
|
|
|
(233
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(233
|
)
|
||||||
Dividends declared
|
—
|
|
|
—
|
|
|
—
|
|
|
(98,499
|
)
|
|
—
|
|
|
—
|
|
|
(98,499
|
)
|
||||||
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
332,795
|
|
|
—
|
|
|
—
|
|
|
332,795
|
|
||||||
Change in unrealized gains and losses on investments in available-for-sale securities, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
71
|
|
|
—
|
|
|
71
|
|
||||||
Changes in unrealized gains and losses on cash flow hedges, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(764
|
)
|
|
—
|
|
|
(764
|
)
|
||||||
Total comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
|
332,102
|
|
||||||||||||
Balance at December 31, 2015
|
164,286,615
|
|
|
1,643
|
|
|
(117,983
|
)
|
|
810,036
|
|
|
2,256
|
|
|
—
|
|
|
695,952
|
|
||||||
Issuance of common stock under employee benefit plans, net
|
1,251,832
|
|
|
12
|
|
|
(12
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Issuance of convertible debt
|
—
|
|
|
—
|
|
|
25,465
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
25,465
|
|
||||||
Purchase of purchased call options, net of tax
|
—
|
|
|
—
|
|
|
(14,400
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(14,400
|
)
|
||||||
Sale of subsidiary shares to non-controlling interest
|
—
|
|
|
—
|
|
|
(3,977
|
)
|
|
—
|
|
|
—
|
|
|
4,227
|
|
|
250
|
|
||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
3,741
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,741
|
|
||||||
Tax benefit from stock options
|
—
|
|
|
—
|
|
|
(462
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(462
|
)
|
||||||
Dividends declared
|
—
|
|
|
—
|
|
|
—
|
|
|
(16,526
|
)
|
|
—
|
|
|
—
|
|
|
(16,526
|
)
|
||||||
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
63,606
|
|
|
—
|
|
|
53
|
|
|
63,659
|
|
||||||
Change in unrealized gains and losses on investments in available-for-sale securities, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(435
|
)
|
|
—
|
|
|
(435
|
)
|
||||||
Changes in unrealized gains and losses on cash flow hedges, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,821
|
)
|
|
—
|
|
|
(1,821
|
)
|
||||||
Total comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
|
61,403
|
|
||||||||||||
Balance at December 31, 2016
|
165,538,447
|
|
|
$
|
1,655
|
|
|
$
|
(107,628
|
)
|
|
$
|
857,116
|
|
|
$
|
—
|
|
|
$
|
4,280
|
|
|
$
|
755,423
|
|
|
Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Cash flows from operating activities
|
|
|
|
|
|
||||||
Net income
|
$
|
63,659
|
|
|
$
|
332,795
|
|
|
$
|
322,244
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Amortization of convertible notes and term loan offering costs
|
10,009
|
|
|
12,963
|
|
|
18,696
|
|
|||
Amortization of intangible assets
|
12,028
|
|
|
—
|
|
|
—
|
|
|||
Asset impairment loss
|
3,735
|
|
|
—
|
|
|
—
|
|
|||
Change in fair value of royalty rights - at fair value
|
(16,196
|
)
|
|
(68,367
|
)
|
|
(44,927
|
)
|
|||
Change in fair value of derivative asset
|
906
|
|
|
(985
|
)
|
|
—
|
|
|||
Change in fair value of anniversary payment and contingent consideration
|
(3,716
|
)
|
|
—
|
|
|
—
|
|
|||
Other amortization, depreciation and accretion of embedded derivative
|
18
|
|
|
40
|
|
|
(134
|
)
|
|||
Inventory write-down
|
342
|
|
|
—
|
|
|
—
|
|
|||
Loss on extinguishment of notes receivable
|
51,075
|
|
|
3,979
|
|
|
—
|
|
|||
(Gain) loss on extinguishment of convertible notes
|
2,353
|
|
|
(6,450
|
)
|
|
6,143
|
|
|||
Hedge ineffectiveness on foreign exchange contracts
|
—
|
|
|
—
|
|
|
(5
|
)
|
|||
Gain on sale of available-for-sale securities
|
(882
|
)
|
|
(997
|
)
|
|
(30
|
)
|
|||
Stock-based compensation expense
|
3,742
|
|
|
2,045
|
|
|
1,501
|
|
|||
Deferred income taxes
|
(10,676
|
)
|
|
17,251
|
|
|
(19,842
|
)
|
|||
Changes in assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable
|
(34,120
|
)
|
|
—
|
|
|
—
|
|
|||
Receivables from licensees and other
|
(6,000
|
)
|
|
300
|
|
|
—
|
|
|||
Prepaid and other current assets
|
(1,526
|
)
|
|
(42
|
)
|
|
2,126
|
|
|||
Accrued interest on notes receivable
|
(2,764
|
)
|
|
(2,246
|
)
|
|
(6,800
|
)
|
|||
Inventory
|
(3,227
|
)
|
|
—
|
|
|
—
|
|
|||
Other assets
|
(757
|
)
|
|
(865
|
)
|
|
(63
|
)
|
|||
Accounts payable
|
6,621
|
|
|
76
|
|
|
31
|
|
|||
Accrued liabilities
|
22,729
|
|
|
(1,048
|
)
|
|
4,343
|
|
|||
Accrued income taxes
|
1,352
|
|
|
79
|
|
|
3,293
|
|
|||
Deferred tax liability
|
(787
|
)
|
|
—
|
|
|
—
|
|
|||
Other long-term liabilities
|
3,800
|
|
|
12,937
|
|
|
5,705
|
|
|||
Net cash provided by operating activities
|
101,718
|
|
|
301,465
|
|
|
292,281
|
|
|||
Cash flows from investing activities
|
|
|
|
|
|
||||||
Acquisition of business, net of cash
|
(109,938
|
)
|
|
—
|
|
|
—
|
|
|||
Purchases of investments
|
(22,952
|
)
|
|
—
|
|
|
(1,750
|
)
|
|||
Purchase of investments - other
|
(75,000
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds from sales of available-for-sale securities
|
4,680
|
|
|
1,947
|
|
|
3,530
|
|
|||
Purchase of royalty rights - at fair value
|
(59,500
|
)
|
|
(115,000
|
)
|
|
(81,100
|
)
|
|||
Proceeds from royalty rights - at fair value
|
72,582
|
|
|
43,407
|
|
|
102,460
|
|
|||
Purchase of notes receivable
|
(9,010
|
)
|
|
(35,235
|
)
|
|
(230,000
|
)
|
|||
Repayment of notes receivable
|
54,653
|
|
|
25,242
|
|
|
68,800
|
|
|||
Purchase of property and equipment
|
(25
|
)
|
|
(9
|
)
|
|
(49
|
)
|
|||
Net cash used in investing activities
|
(144,510
|
)
|
|
(79,648
|
)
|
|
(138,109
|
)
|
|||
Cash flows from financing activities
|
|
|
|
|
|
||||||
Proceeds from term loan
|
—
|
|
|
100,000
|
|
|
—
|
|
|||
Repayment of term loan
|
(25,000
|
)
|
|
(75,000
|
)
|
|
(75,000
|
)
|
|||
Repurchase of convertible notes
|
(120,000
|
)
|
|
(220,397
|
)
|
|
(56,191
|
)
|
|||
Payment of debt issuance costs
|
(3,204
|
)
|
|
(607
|
)
|
|
(9,825
|
)
|
|||
Proceeds from issuance of convertible notes
|
150,000
|
|
|
—
|
|
|
300,000
|
|
|||
Purchase of call options
|
(14,400
|
)
|
|
—
|
|
|
(30,951
|
)
|
|||
Cash received from noncontrolling interest holder
|
250
|
|
|
—
|
|
|
—
|
|
|||
Proceeds from issuance of warrants
|
—
|
|
|
—
|
|
|
11,427
|
|
|||
Cash dividends paid
|
(16,583
|
)
|
|
(98,307
|
)
|
|
(96,557
|
)
|
|||
Net cash provided by (used in) financing activities
|
(28,937
|
)
|
|
(294,311
|
)
|
|
42,903
|
|
|||
Net increase (decrease) in cash and cash equivalents
|
(71,729
|
)
|
|
(72,494
|
)
|
|
197,075
|
|
|||
Cash and cash equivalents at beginning of the year
|
218,883
|
|
|
291,377
|
|
|
94,302
|
|
|||
Cash and cash equivalents at end the year
|
$
|
147,154
|
|
|
$
|
218,883
|
|
|
$
|
291,377
|
|
|
Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Supplemental cash flow information
|
|
|
|
|
|
||||||
Cash paid for income taxes
|
$
|
50,000
|
|
|
$
|
168,000
|
|
|
$
|
189,000
|
|
Cash paid for interest
|
$
|
11,410
|
|
|
$
|
16,987
|
|
|
$
|
18,439
|
|
Supplemental schedule of non-cash investing and financing activities
|
|
|
|
|
|
||||||
Stock issued to settle debt
|
$
|
—
|
|
|
$
|
9,794
|
|
|
$
|
171,879
|
|
Conversion of notes receivable to common stock investment
|
$
|
—
|
|
|
$
|
6,567
|
|
|
$
|
—
|
|
Warrants received for notes receivable
|
$
|
2,342
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Accrued Anniversary Payment associated with the acquisition of a business
|
$
|
87,007
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Accrued contingent consideration associated with the acquisition of a business
|
$
|
47,360
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Leasehold improvements
|
|
Shorter of asset life or term of lease
|
Computer and office equipment
|
|
3 years
|
Furniture and fixtures
|
|
7 years
|
|
Year Ended December 31,
|
||||||||||
(In thousands, except per share amounts)
|
2016
|
|
2015
|
|
2014
|
||||||
Numerator
|
|
|
|
|
|
||||||
Income attributable to the Company’s shareholders used to compute net income per diluted share
|
$
|
63,606
|
|
|
$
|
332,795
|
|
|
$
|
322,244
|
|
|
|
|
|
|
|
||||||
Denominator
|
|
|
|
|
|
||||||
Total weighted-average shares used to compute net income per basic share
|
163,805
|
|
|
163,386
|
|
|
158,224
|
|
|||
Effect of dilutive stock options
|
—
|
|
|
16
|
|
|
21
|
|
|||
Restricted stock awards
|
387
|
|
|
152
|
|
|
126
|
|
|||
Assumed conversion of Series 2012 Notes
|
—
|
|
|
—
|
|
|
3,532
|
|
|||
Assumed conversion of warrants
|
—
|
|
|
—
|
|
|
5,510
|
|
|||
Assumed conversion of May 2015 Notes
|
—
|
|
|
—
|
|
|
5,697
|
|
|||
Shares used to compute net income per diluted share
|
164,192
|
|
|
163,554
|
|
|
173,110
|
|
|||
|
|
|
|
|
|
||||||
Net income per basic share
|
$
|
0.39
|
|
|
$
|
2.04
|
|
|
$
|
2.04
|
|
Net income per diluted share
|
$
|
0.39
|
|
|
$
|
2.03
|
|
|
$
|
1.86
|
|
|
|
December 31, 2016
|
|
December 31, 2015
|
||||||||||||||||||||||||||||
(In thousands)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||||||||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Money market funds
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
94,801
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
94,801
|
|
Certificates of deposit
|
|
—
|
|
|
75,000
|
|
|
—
|
|
|
75,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Corporate securities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,469
|
|
|
—
|
|
|
1,469
|
|
||||||||
Commercial paper
|
|
—
|
|
|
19,987
|
|
|
—
|
|
|
19,987
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Foreign currency hedge contracts
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,802
|
|
|
—
|
|
|
2,802
|
|
||||||||
Warrants
|
|
—
|
|
|
78
|
|
|
—
|
|
|
78
|
|
|
—
|
|
|
984
|
|
|
—
|
|
|
984
|
|
||||||||
Royalty rights - at fair value
|
|
—
|
|
|
—
|
|
|
402,318
|
|
|
402,318
|
|
|
—
|
|
|
—
|
|
|
399,204
|
|
|
399,204
|
|
||||||||
Total
|
|
$
|
4
|
|
|
$
|
95,065
|
|
|
$
|
402,318
|
|
|
$
|
497,387
|
|
|
$
|
94,801
|
|
|
$
|
5,255
|
|
|
$
|
399,204
|
|
|
$
|
499,260
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Anniversary payment
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
88,001
|
|
|
$
|
88,001
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Contingent consideration
|
|
—
|
|
|
—
|
|
|
42,650
|
|
|
42,650
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Total
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
130,651
|
|
|
$
|
130,651
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3) - Royalty Rights Assets
|
||||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
|
Fair Value as of
|
|
New Royalty
|
|
Royalty Rights -
|
|
Fair Value as of
|
||||||||
(in thousands)
|
|
December 31, 2015
|
|
Assets
|
|
Change in Fair Value
|
|
December 31, 2016
|
||||||||
Depomed
|
|
$
|
191,865
|
|
|
$
|
—
|
|
|
$
|
(27,795
|
)
|
|
$
|
164,070
|
|
VB
|
|
17,133
|
|
|
—
|
|
|
(2,136
|
)
|
|
14,997
|
|
||||
U-M
|
|
70,186
|
|
|
—
|
|
|
(34,800
|
)
|
|
35,386
|
|
||||
ARIAD
|
|
50,041
|
|
|
50,000
|
|
|
8,590
|
|
|
108,631
|
|
||||
AcelRx
|
|
67,437
|
|
|
—
|
|
|
46
|
|
|
67,483
|
|
||||
Avinger
|
|
2,542
|
|
|
—
|
|
|
(904
|
)
|
|
1,638
|
|
||||
KYBELLA
|
|
—
|
|
|
9,500
|
|
|
613
|
|
|
10,113
|
|
||||
|
|
$
|
399,204
|
|
|
$
|
59,500
|
|
|
$
|
(56,386
|
)
|
|
$
|
402,318
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3) - Other Assets
|
|||||||
|
|
|
|
|
|
||
(in thousands)
|
|
|
Preferred Stock Warrants
|
||||
Fair value as of December 31, 2015
|
|
$
|
—
|
|
|||
|
|
|
|
|
|
||
|
Fair value of financial instruments purchased
|
|
2,327
|
|
|||
|
Total net change in fair value for the period
|
|
(102
|
)
|
|||
|
Write off of financial instruments
|
|
(2,225
|
)
|
|||
|
|
|
|
|
|
||
Fair value as of December 31, 2016
|
|
$
|
—
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3) - Liabilities
|
||||||||||
|
|
|
|
|
|
|
||||
(in thousands)
|
|
Anniversary Payment
|
|
Contingent Consideration
|
||||||
Fair value as of December 31, 2015
|
$
|
—
|
|
|
$
|
—
|
|
|||
|
|
|
|
|
|
|
||||
|
Fair value of financial instruments purchased
|
(87,007
|
)
|
|
(47,360
|
)
|
||||
|
Total net change in fair value for the period
|
(994
|
)
|
|
4,710
|
|
||||
|
|
|
|
|
|
|
||||
Fair value as of December 31, 2016
|
$
|
(88,001
|
)
|
|
$
|
(42,650
|
)
|
|
|
Year Ended December 31,
|
||||||
(in thousands)
|
|
2016
|
|
2015
|
||||
|
|
|
|
|
||||
Total change in fair value for the period included in earnings for royalty right assets held at the end of the reporting period
|
|
$
|
16,196
|
|
|
$
|
68,367
|
|
|
|
|
|
|
||||
Total change in fair value for the period included in earnings for liabilities held at the end of the reporting period
|
|
$
|
3,716
|
|
|
$
|
—
|
|
|
|
December 31, 2016
|
|
December 31, 2015
|
||||||||||||||||||||
|
|
Carrying Value
|
|
Level 2
|
|
Level 3
|
|
Carrying Value
|
|
Level 2
|
|
Level 3
|
||||||||||||
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Wellstat Diagnostics note receivable
|
|
$
|
50,191
|
|
|
$
|
—
|
|
|
$
|
52,260
|
|
|
$
|
50,191
|
|
|
$
|
—
|
|
|
$
|
55,970
|
|
Hyperion note receivable
|
|
1,200
|
|
|
—
|
|
|
1,200
|
|
|
1,200
|
|
|
—
|
|
|
1,200
|
|
||||||
LENSAR note receivable
|
|
43,909
|
|
|
—
|
|
|
43,900
|
|
|
42,271
|
|
|
—
|
|
|
42,618
|
|
||||||
Direct Flow Medical note receivable
|
|
10,000
|
|
|
—
|
|
|
10,000
|
|
|
51,852
|
|
|
—
|
|
|
51,992
|
|
||||||
Paradigm Spine note receivable
|
|
—
|
|
|
—
|
|
|
—
|
|
|
53,973
|
|
|
—
|
|
|
54,250
|
|
||||||
kaléo note receivable
|
|
146,685
|
|
|
—
|
|
|
142,539
|
|
|
146,778
|
|
|
—
|
|
|
146,789
|
|
||||||
CareView note receivable
|
|
18,965
|
|
|
—
|
|
|
19,200
|
|
|
18,640
|
|
|
—
|
|
|
19,495
|
|
||||||
Total
|
|
$
|
270,950
|
|
|
$
|
—
|
|
|
$
|
269,099
|
|
|
$
|
364,905
|
|
|
$
|
—
|
|
|
$
|
372,314
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
February 2018 Notes
|
|
$
|
121,595
|
|
|
$
|
123,918
|
|
|
$
|
—
|
|
|
$
|
228,862
|
|
|
$
|
197,946
|
|
|
$
|
—
|
|
December 2021 Notes
|
|
110,848
|
|
|
122,063
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Term loan
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24,966
|
|
|
—
|
|
|
25,000
|
|
||||||
Total
|
|
$
|
232,443
|
|
|
$
|
245,981
|
|
|
$
|
—
|
|
|
$
|
253,828
|
|
|
$
|
197,946
|
|
|
$
|
25,000
|
|
Asset
|
|
Valuation
Technique
|
|
Unobservable
Input
|
|
December 31,
2016
|
|
December 31,
2015
|
|
|
|
|
|
|
|
|
|
Wellstat Diagnostics
|
|
|
|
|
|
|
|
|
Intellectual Property
|
|
Income Approach
|
|
|
|
|
|
|
|
|
|
|
Discount rate
|
|
13%
|
|
13%
|
|
|
|
|
Royalty amount
|
|
$55-74 million
|
|
$54-74 million
|
Real Estate Property
|
|
Market Approach
|
|
|
|
|
|
|
|
|
|
|
Annual appreciation rate
|
|
4%
|
|
4%
|
|
|
|
|
Estimated realtor fee
|
|
6%
|
|
6%
|
|
|
|
|
Estimated disposal date
|
|
12/31/2017
|
|
12/31/2017
|
Direct Flow Medical
|
|
|
|
|
|
|
|
|
All Assets
|
|
Income Approach
Market Approach
|
|
|
|
|
|
|
|
|
|
|
Discount rate
|
|
27%
|
|
27%
|
|
|
|
|
Implied revenue multiple
|
|
6.9
|
|
6.9
|
|
|
|
|
Estimated disposal date
|
|
12/31/2017
|
|
-
|
LENSAR
|
|
|
|
|
|
|
|
|
All Assets
|
|
Income Approach
|
|
|
|
|
|
|
|
|
|
|
Discount rate
|
|
25%
|
|
15.75%
|
|
|
|
|
Implied revenue multiple
|
|
2.5
|
|
-
|
Summary of Cash and Available-For-Sale Securities
|
|
Adjusted Cost
|
|
Unrealized Gains
|
|
Fair Value
|
|
Cash and Cash Equivalents
|
|
Short-Term Investments
|
||||||||||
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash
|
|
$
|
147,150
|
|
|
$
|
—
|
|
|
$
|
147,150
|
|
|
$
|
147,150
|
|
|
$
|
—
|
|
Money market funds
|
|
4
|
|
|
—
|
|
|
4
|
|
|
4
|
|
|
—
|
|
|||||
Commercial paper
|
|
19,987
|
|
|
—
|
|
|
19,987
|
|
|
—
|
|
|
19,987
|
|
|||||
Total
|
|
$
|
167,141
|
|
|
$
|
—
|
|
|
$
|
167,141
|
|
|
$
|
147,154
|
|
|
$
|
19,987
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2015
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash
|
|
$
|
124,082
|
|
|
$
|
—
|
|
|
$
|
124,082
|
|
|
$
|
124,082
|
|
|
$
|
—
|
|
Money market funds
|
|
94,801
|
|
|
—
|
|
|
94,801
|
|
|
94,801
|
|
|
—
|
|
|||||
Corporate securities
|
|
799
|
|
|
670
|
|
|
1,469
|
|
|
—
|
|
|
1,469
|
|
|||||
Total
|
|
$
|
219,682
|
|
|
$
|
670
|
|
|
$
|
220,352
|
|
|
$
|
218,883
|
|
|
$
|
1,469
|
|
Euro Forward Contracts
|
|
|
|
December 31, 2016
|
|
December 31, 2015
|
||||||||||||||
|
|
|
|
|
|
(In thousands)
|
|
(In thousands)
|
||||||||||||
Currency
|
|
Settlement Price
($ per Euro)
|
|
Type
|
|
Notional Amount
|
|
Fair Value
|
|
Notional Amount
|
|
Fair Value
|
||||||||
Euro
|
|
1.260
|
|
Sell Euro
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
16,500
|
|
|
$
|
2,802
|
|
|
|
|
|
December 31,
|
||||||
Cash Flow Hedge
|
|
Location
|
|
2016
|
|
2015
|
||||
(In thousands)
|
|
|
|
|
|
|
||||
Euro forward contracts
|
|
Prepaid and other current assets
|
|
$
|
—
|
|
|
$
|
2,802
|
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2016
|
|
2015
|
|
2014
|
||||||
(In thousands)
|
|
|
|
|
|
|
||||||
Net gain (loss) recognized in OCI, net of tax
(1)
|
|
$
|
—
|
|
|
$
|
4,626
|
|
|
$
|
4,834
|
|
Gain (loss) reclassified from accumulated OCI into “Queen et al.
royalty revenue,” net of tax
(2)
|
|
$
|
1,821
|
|
|
$
|
5,390
|
|
|
$
|
(3,768
|
)
|
Net gain (loss) recognized in “Interest and other income, net”
-- cash flow hedges
(3)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5
|
|
|
|
December 31,
|
||
|
|
2016
|
||
Work in process
|
|
1,625
|
|
|
Finished goods
|
|
1,259
|
|
|
Total inventories
|
|
$
|
2,884
|
|
|
|
December 31,
|
||||||
(In thousands)
|
|
2016
|
|
2015
|
||||
Leasehold improvements
|
|
$
|
153
|
|
|
$
|
153
|
|
Computer and office equipment
|
|
8,995
|
|
|
8,984
|
|
||
Furniture and fixtures
|
|
60
|
|
|
45
|
|
||
Total
|
|
9,208
|
|
|
9,182
|
|
||
Less accumulated depreciation and amortization
|
|
(9,170
|
)
|
|
(9,151
|
)
|
||
Property and equipment, net
|
|
$
|
38
|
|
|
$
|
31
|
|
(in thousands)
|
|
Weighted Average Useful Life (Years)
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Book Value
|
||||||
Finite-lived intangible assets:
|
|
|
|
|
|
|
|
|
||||||
Acquired products rights
1
|
|
10
|
|
$
|
216,690
|
|
|
$
|
(10,834
|
)
|
|
$
|
205,856
|
|
Customer relationships
1
|
|
10
|
|
23,880
|
|
|
(1,194
|
)
|
|
22,686
|
|
|||
|
|
|
|
$
|
240,570
|
|
|
$
|
(12,028
|
)
|
|
$
|
228,542
|
|
Fiscal Year
|
|
Amount
|
||
2017
|
|
$
|
24,057
|
|
2018
|
|
24,057
|
|
|
2019
|
|
24,057
|
|
|
2020
|
|
24,057
|
|
|
2021
|
|
24,057
|
|
|
Thereafter
|
|
108,257
|
|
|
Total remaining estimated amortization expense
|
|
$
|
228,542
|
|
|
|
December 31,
|
||||||
(In thousands)
|
|
2016
|
|
2015
|
||||
Compensation
|
|
$
|
3,131
|
|
|
$
|
1,979
|
|
Interest
|
|
2,554
|
|
|
4,107
|
|
||
Refund to manufacturer
|
|
8,909
|
|
|
—
|
|
||
Accrued rebates, chargebacks and other revenue reserves
|
|
12,338
|
|
|
87
|
|
||
Dividend payable
|
|
21
|
|
|
184
|
|
||
Legal
|
|
1,594
|
|
|
730
|
|
||
Other
|
|
2,028
|
|
|
922
|
|
||
Total
|
|
$
|
30,575
|
|
|
$
|
8,009
|
|
(in thousands)
|
|
Discount and Distribution Fees
|
|
Government Rebates and Chargebacks
|
|
Assistance and Other Discounts
|
|
Product Return
|
|
Total
|
||||||||||
Balance at October 1, 2016:
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Allowances for current period sales
|
|
2,754
|
|
|
5,514
|
|
|
2,580
|
|
|
1,769
|
|
|
12,617
|
|
|||||
Allowances for prior period sales
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Credits/payments for current period sales
|
|
(279
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(279
|
)
|
|||||
Credits/payments for prior period sales
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Balance at December 31, 2016
|
|
$
|
2,475
|
|
|
$
|
5,514
|
|
|
$
|
2,580
|
|
|
$
|
1,769
|
|
|
$
|
12,338
|
|
(In thousands)
|
|
|
||
2017
|
|
$
|
184
|
|
2018
|
|
96
|
|
|
2019
|
|
87
|
|
|
2020
|
|
79
|
|
|
2021
|
|
59
|
|
|
Thereafter
|
|
—
|
|
|
Total
|
|
$
|
505
|
|
(In thousands)
|
|
Series
2012
Notes
|
|
May
2015
Notes
|
|
February 2018
Notes
|
|
December 2021
Notes
|
|
Term Loan
|
|
Total
|
||||||||||||
Balance at December 31, 2014
|
|
$
|
22,261
|
|
|
$
|
153,235
|
|
|
$
|
269,275
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
444,771
|
|
Issuance and exchange
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
100,000
|
|
|
100,000
|
|
||||||
Payment
|
|
(22,337
|
)
|
|
(155,050
|
)
|
|
—
|
|
|
—
|
|
|
(75,000
|
)
|
|
(252,387
|
)
|
||||||
Repurchase
|
|
—
|
|
|
—
|
|
|
(53,553
|
)
|
|
—
|
|
|
—
|
|
|
(53,553
|
)
|
||||||
Non-cash Discount
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(607
|
)
|
|
(607
|
)
|
||||||
Amortization
|
|
76
|
|
|
1,815
|
|
|
13,140
|
|
|
—
|
|
|
573
|
|
|
15,604
|
|
||||||
Balance at December 31, 2015
|
|
—
|
|
|
—
|
|
|
228,862
|
|
|
—
|
|
|
24,966
|
|
|
253,828
|
|
||||||
Issuance and exchange
|
|
—
|
|
|
—
|
|
|
—
|
|
|
150,000
|
|
|
—
|
|
|
150,000
|
|
||||||
Payment
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25,000
|
)
|
|
(25,000
|
)
|
||||||
Repurchase
|
|
—
|
|
|
—
|
|
|
(120,000
|
)
|
|
—
|
|
|
—
|
|
|
(120,000
|
)
|
||||||
Non-cash Discount
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,204
|
)
|
|
—
|
|
|
(3,204
|
)
|
||||||
Non-cash conversion feature
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(36,653
|
)
|
|
—
|
|
|
(36,653
|
)
|
||||||
Amortization
|
|
—
|
|
|
—
|
|
|
12,733
|
|
|
705
|
|
|
34
|
|
|
13,472
|
|
||||||
Balance at December 31, 2016
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
121,595
|
|
|
$
|
110,848
|
|
|
$
|
—
|
|
|
$
|
232,443
|
|
|
|
Year ended December 31,
|
||||||||||
(In thousands)
|
|
2016
|
|
2015
|
|
2014
|
||||||
Contractual coupon interest
|
|
$
|
—
|
|
|
$
|
80
|
|
|
$
|
1,726
|
|
Amortization of debt issuance costs
|
|
—
|
|
|
13
|
|
|
1,089
|
|
|||
Amortization of debt discount
|
|
—
|
|
|
76
|
|
|
2,415
|
|
|||
Total
|
|
$
|
—
|
|
|
$
|
169
|
|
|
$
|
5,230
|
|
|
|
Year Ended December 31,
|
||||||||||
(In thousands)
|
|
2016
|
|
2015
|
|
2014
|
||||||
Contractual coupon interest
|
|
$
|
—
|
|
|
$
|
1,938
|
|
|
$
|
5,817
|
|
Amortization of debt issuance costs
|
|
—
|
|
|
435
|
|
|
1,274
|
|
|||
Amortization of debt discount
|
|
—
|
|
|
1,815
|
|
|
5,182
|
|
|||
Total
|
|
$
|
—
|
|
|
$
|
4,188
|
|
|
$
|
12,273
|
|
•
|
During any fiscal quarter ending after the quarter ending June 30, 2014, if the last reported sale price of the Company’s common stock for at least
20
trading days in a period of
30
consecutive trading days ending on the last trading day of the immediately preceding fiscal quarter exceeds
130%
of the conversion price for the notes on the last day of such preceding fiscal quarter;
|
•
|
During the
five
business-day period immediately after any
five
consecutive trading-day period, which the Company refers to as the measurement period, in which the trading price per
$1,000
principal amount of notes for each trading day of that measurement period was less than
98%
of the product of the last reported sale price of the Company’s common stock and the conversion rate for the notes for each such day;
|
•
|
Upon the occurrence of specified corporate events as described further in the indenture; or
|
•
|
At any time on or after August 1, 2017.
|
(In thousands)
|
|
December 31, 2016
|
|
December 31, 2015
|
||||
Principal amount of the February 2018 Notes
|
|
$
|
126,447
|
|
|
$
|
246,447
|
|
Unamortized discount of liability component
|
|
(4,852
|
)
|
|
(17,585
|
)
|
||
Net carrying value of the February 2018 Notes
|
|
$
|
121,595
|
|
|
$
|
228,862
|
|
|
|
Year Ended December 31,
|
||||||||||
(In thousands)
|
|
2016
|
|
2015
|
|
2014
|
||||||
Contractual coupon interest
|
|
$
|
9,338
|
|
|
$
|
11,786
|
|
|
$
|
10,633
|
|
Amortization of debt issuance costs
|
|
2,863
|
|
|
2,980
|
|
|
1,898
|
|
|||
Amortization of debt discount
|
|
9,870
|
|
|
10,160
|
|
|
5,954
|
|
|||
Total
|
|
$
|
22,071
|
|
|
$
|
24,926
|
|
|
$
|
18,485
|
|
•
|
During any fiscal quarter (and only during such fiscal quarter) commencing after the fiscal quarter ending March 31, 2017, if the last reported sale price of Company common stock for at least
20
trading days (whether or not consecutive), in the period of
30
consecutive trading days, ending on, and including, the last trading day of the immediately preceding fiscal quarter, exceeds
130%
of the conversion price for the notes on each applicable trading day;
|
•
|
During the five business-day period immediately after any five consecutive trading-day period, which the Company refers to as the measurement period, in which the trading price per
$1,000
principal amount of notes for each trading day of that measurement period was less than
98%
of the product of the last reported sale price of Company common stock and the conversion rate for the notes for each such trading day; or
|
•
|
Upon the occurrence of specified corporate events as described in the indenture.
|
(In thousands)
|
|
December 31, 2016
|
||
Principal amount of the December 2021 Notes
|
|
$
|
150,000
|
|
Unamortized discount of liability component
|
|
(39,152
|
)
|
|
Net carrying value of the December 2021 Notes
|
|
$
|
110,848
|
|
|
|
Year Ended December 31,
|
||
(In thousands)
|
|
2016
|
||
Contractual coupon interest
|
|
$
|
447
|
|
Amortization of debt issuance costs
|
|
10
|
|
|
Amortization of debt discount
|
|
75
|
|
|
Amortization of conversion feature
|
|
620
|
|
|
Total
|
|
$
|
1,152
|
|
(In thousands)
|
|
February 2018
Notes
|
|
December 2021 Notes
|
|
Total
|
||||||
2017
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
2018
|
|
126,447
|
|
|
—
|
|
|
126,447
|
|
|||
2019
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
2020
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
2021
|
|
—
|
|
|
150,000
|
|
|
150,000
|
|
|||
Thereafter
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total
|
|
$
|
126,447
|
|
|
$
|
150,000
|
|
|
$
|
276,447
|
|
|
|
December 31,
|
||||||
(In thousands)
|
|
2016
|
|
2015
|
||||
Accrued lease liability
|
|
$
|
10,700
|
|
|
$
|
10,700
|
|
Long-term incentive
|
|
1,995
|
|
|
1,318
|
|
||
Uncertain tax position
|
|
41,591
|
|
|
38,467
|
|
||
Dividend payable
|
|
270
|
|
|
165
|
|
||
Total
|
|
$
|
54,556
|
|
|
$
|
50,650
|
|
|
|
Year Ended December 31,
|
||||||||||
Stock-based Compensation
|
|
2016
|
|
2015
|
|
2014
|
||||||
(In thousands)
|
|
|
|
|
|
|
||||||
Employees and directors
|
|
$
|
3,679
|
|
|
$
|
1,952
|
|
|
$
|
1,157
|
|
Non-employees
|
|
63
|
|
|
93
|
|
|
344
|
|
|||
Total
|
|
$
|
3,742
|
|
|
$
|
2,045
|
|
|
$
|
1,501
|
|
Title of Plan
|
|
Total Shares of Common Stock Authorized
|
|
Total Shares of Common Stock Issued
|
|
Total Shares of Common Stock
Subject to
Outstanding Awards
|
|
Total Shares of Common Stock Available for Grant
|
||||
2005 Equity Incentive Plan
(1)
|
|
6,200,000
|
|
|
2,767,700
|
|
|
—
|
|
|
3,432,300
|
|
2002 Outside Directors Stock Option Plan
(2)
|
|
157,000
|
|
|
157,000
|
|
|
—
|
|
|
—
|
|
1999 Non-statutory Stock Option Plan
(2)
|
|
4,966,183
|
|
|
4,966,183
|
|
|
—
|
|
|
—
|
|
1999 Stock Option Plan
(2)
|
|
3,694,485
|
|
|
3,694,485
|
|
|
—
|
|
|
—
|
|
(1)
|
As of
December 31, 2016
, there were
1,471,910
shares of unvested restricted stock awards outstanding.
|
(2)
|
Plan terminated in 2009, subject to options outstanding under the plan.
|
|
|
2016
|
|
|
|
2015
|
|
|
|
2014
|
|
|
|||||||||
|
|
Number of shares
(in thousands)
|
|
Weighted-Average Exercise Price
|
|
Number of shares
(in thousands)
|
|
Weighted-Average Exercise Price
|
|
Number of shares
(in thousands)
|
|
Weighted-Average Exercise Price
|
|||||||||
Outstanding at beginning of year
|
|
—
|
|
|
$
|
—
|
|
|
58
|
|
|
$
|
5.41
|
|
|
172
|
|
|
$
|
16.52
|
|
Expired
|
|
—
|
|
|
$
|
—
|
|
|
(58
|
)
|
|
$
|
5.41
|
|
|
(114
|
)
|
|
$
|
22.08
|
|
Outstanding at end of year
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
58
|
|
|
$
|
5.41
|
|
Exercisable at end of year
|
|
—
|
|
|
$
|
—
|
|
|
58
|
|
|
$
|
—
|
|
|
58
|
|
|
$
|
5.41
|
|
|
2016
|
|
2015
|
|
2014
|
|||||||||||||||
|
Number of shares
(in thousands)
|
|
Weighted-average grant-date fair value per share
|
|
Number of shares
(in thousands)
|
|
Weighted-average grant-date fair value per share
|
|
Number of shares
(in thousands)
|
|
Weighted- average grant-date fair value per share
|
|||||||||
Nonvested at beginning of year
|
586
|
|
|
$
|
7.13
|
|
|
277
|
|
|
$
|
8.39
|
|
|
114
|
|
|
$
|
7.45
|
|
Awards granted
|
1,264
|
|
|
$
|
3.31
|
|
|
522
|
|
|
$
|
6.40
|
|
|
312
|
|
|
$
|
8.39
|
|
Awards vested
|
(366
|
)
|
|
$
|
6.65
|
|
|
(173
|
)
|
|
$
|
8.38
|
|
|
(149
|
)
|
|
$
|
7.67
|
|
Forfeited
|
(12
|
)
|
|
$
|
7.10
|
|
|
(40
|
)
|
|
$
|
7.79
|
|
|
—
|
|
|
$
|
—
|
|
Nonvested at end of year
|
1,472
|
|
|
$
|
3.96
|
|
|
586
|
|
|
$
|
7.13
|
|
|
277
|
|
|
$
|
8.39
|
|
|
|
Year Ended December 31,
|
||||||||||
(In thousands)
|
|
2016
|
|
2015
|
|
2014
|
||||||
Current income tax expense
|
|
|
|
|
|
|
||||||
Federal
|
|
$
|
49,582
|
|
|
$
|
168,164
|
|
|
$
|
187,056
|
|
State
|
|
3,103
|
|
|
12,112
|
|
|
22,631
|
|
|||
Foreign
|
|
2,455
|
|
|
—
|
|
|
—
|
|
|||
Total current
|
|
55,140
|
|
|
180,276
|
|
|
209,687
|
|
|||
Deferred income tax expense (benefit)
|
|
|
|
|
|
|
||||||
Federal
|
|
(8,476
|
)
|
|
16,910
|
|
|
(29,095
|
)
|
|||
State
|
|
147
|
|
|
157
|
|
|
(1,564
|
)
|
|||
Foreign
|
|
(1,100
|
)
|
|
—
|
|
|
—
|
|
|||
Total deferred
|
|
(9,429
|
)
|
|
17,067
|
|
|
(30,659
|
)
|
|||
Total provision
|
|
$
|
45,711
|
|
|
$
|
197,343
|
|
|
$
|
179,028
|
|
|
|
Year Ended December 31,
|
||||||||||
(In thousands)
|
|
2016
|
|
2015
|
|
2014
|
||||||
Tax at U.S. statutory rate on income before income taxes
|
|
$
|
38,279
|
|
|
$
|
185,548
|
|
|
$
|
175,445
|
|
Change in valuation allowance
|
|
(744
|
)
|
|
2,286
|
|
|
(5,390
|
)
|
|||
State taxes
|
|
74
|
|
|
1
|
|
|
1
|
|
|||
Change in uncertain tax positions
|
|
2,184
|
|
|
8,717
|
|
|
7,395
|
|
|||
Foreign income
|
|
5,668
|
|
|
—
|
|
|
—
|
|
|||
Foreign rate differential
|
|
(1,445
|
)
|
|
—
|
|
|
—
|
|
|||
Other
|
|
1,695
|
|
|
791
|
|
|
1,577
|
|
|||
Total
|
|
$
|
45,711
|
|
|
$
|
197,343
|
|
|
$
|
179,028
|
|
|
|
December 31,
|
||||||
(In thousands)
|
|
2016
|
|
2015
|
||||
Deferred tax assets:
|
|
|
|
|
||||
Net operating loss carryforwards
|
|
$
|
4,197
|
|
|
$
|
4,819
|
|
Research and other tax credits
|
|
1,833
|
|
|
1,990
|
|
||
Intangible assets
|
|
494
|
|
|
—
|
|
||
Stock-based compensation
|
|
835
|
|
|
465
|
|
||
Accruals
|
|
1,966
|
|
|
1,146
|
|
||
Debt modifications
|
|
—
|
|
|
5,526
|
|
||
Capital loss carryforward
|
|
1,543
|
|
|
2,286
|
|
||
Other
|
|
13,020
|
|
|
12,023
|
|
||
Total deferred tax assets
|
|
23,888
|
|
|
28,255
|
|
||
Valuation allowance
|
|
(1,543
|
)
|
|
(2,286
|
)
|
||
Total deferred tax assets, net of valuation allowance
|
|
22,345
|
|
|
25,969
|
|
||
Deferred tax liabilities:
|
|
|
|
|
||||
Deferred gain on repurchase of convertible notes
|
|
(382
|
)
|
|
(572
|
)
|
||
Debt modifications
|
|
(122
|
)
|
|
—
|
|
||
Intangible assets
|
|
(2,584
|
)
|
|
(7,029
|
)
|
||
Unrealized gain on foreign currency hedge contracts
|
|
—
|
|
|
(1,215
|
)
|
||
Total deferred tax liabilities
|
|
(3,088
|
)
|
|
(8,816
|
)
|
||
Net deferred tax assets
|
|
$
|
19,257
|
|
|
$
|
17,153
|
|
|
|
December 31,
|
||||||||||
(In thousands)
|
|
2016
|
|
2015
|
|
2014
|
||||||
Balance at the beginning of the year
|
|
$
|
57,125
|
|
|
$
|
47,146
|
|
|
$
|
32,419
|
|
Increases related to tax positions from prior fiscal years
|
|
436
|
|
|
—
|
|
|
10,216
|
|
|||
Increases related to tax positions taken during current fiscal year
|
|
1,868
|
|
|
9,979
|
|
|
11,006
|
|
|||
Expiration of statute of limitations for the assessment of taxes from prior fiscal years
|
|
—
|
|
|
—
|
|
|
(6,495
|
)
|
|||
Balance at the end of the year
|
|
$
|
59,429
|
|
|
$
|
57,125
|
|
|
$
|
47,146
|
|
(In thousands)
|
|
Unrealized gain
(loss) on
available-for-
sale securities
|
|
Unrealized
gain (loss) on
cash flow
hedges
|
|
Total Accumulated
Other
Comprehensive
Income (Loss)
|
||||||
|
|
|
|
|
|
|
||||||
Beginning Balance at December 31, 2013
|
|
$
|
1,129
|
|
|
$
|
(6,017
|
)
|
|
$
|
(4,888
|
)
|
Activity for the year ended December 31, 2014
|
|
(765
|
)
|
|
8,602
|
|
|
7,837
|
|
|||
Balance at December 31, 2014
|
|
364
|
|
|
2,585
|
|
|
2,949
|
|
|||
|
|
|
|
|
|
|
||||||
Activity for the year ended December 31, 2015
|
|
71
|
|
|
(764
|
)
|
|
(693
|
)
|
|||
Balance at December 31, 2015
|
|
435
|
|
|
1,821
|
|
|
2,256
|
|
|||
|
|
|
|
|
|
|
||||||
Activity for the year ended December 31, 2016
|
|
(435
|
)
|
|
(1,821
|
)
|
|
(2,256
|
)
|
|||
Ending Balance at December 31, 2016
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Consideration paid in cash at closing
|
|
$
|
109,938
|
|
Discounted anniversary payment
|
|
87,007
|
|
|
Fair value of contingent consideration
|
|
47,360
|
|
|
Total fair value of consideration transferred
|
|
$
|
244,305
|
|
Acquired product rights
|
|
$
|
216,690
|
|
Customer relationships
|
|
23,880
|
|
|
Goodwill
|
|
3,735
|
|
|
Net intangible assets
|
|
$
|
244,305
|
|
|
|
Year Ended
|
||||||
|
|
December 31,
|
||||||
(in thousands)
|
|
2016
|
|
2015
|
||||
Pro forma revenues
|
|
$
|
317,095
|
|
|
$
|
744,029
|
|
Pro forma net income
|
|
$
|
62,817
|
|
|
$
|
363,148
|
|
Pro forma net income per share - basic
|
|
$
|
0.38
|
|
|
$
|
2.22
|
|
Pro forma net income per share - diluted
|
|
$
|
0.38
|
|
|
$
|
2.22
|
|
•
|
Adjustment to recognize incremental amortization expense based on the fair value of intangibles acquired;
|
•
|
Eliminate transaction costs and non-recurring charges directly related to the acquisition that were included in the historical results of operations for the Company; and
|
•
|
Adjustment to recognize pro forma income tax based on income tax benefit on the amortization of intangible asset at the statutory tax rate of Ireland (
12.5%
), and the income tax benefit on the interest expense at the statutory tax rate of the United States (
35.0%
).
|
Revenues by segment
|
|
Year Ended
|
||||||
|
|
December 31,
|
||||||
(in thousands)
|
|
2016
|
|
2015
|
||||
Income generating assets
|
|
$
|
212,632
|
|
|
$
|
590,448
|
|
Product sales
|
|
31,669
|
|
|
—
|
|
||
Total revenues
|
|
$
|
244,301
|
|
|
$
|
590,448
|
|
Income (loss) by segment
|
|
Year Ended
|
||||||
|
|
December 31,
|
||||||
(in thousands)
|
|
2016
|
|
2015
|
||||
Income generating assets
|
|
$
|
59,085
|
|
|
$
|
332,795
|
|
Product sales
|
|
4,521
|
|
|
—
|
|
||
Total net income
|
|
$
|
63,606
|
|
|
$
|
332,795
|
|
|
|
Year Ended December 31,
|
|||||||
|
|
2016
|
|
2015
|
|
2014
|
|||
Income Generating Assets:
|
|
|
|
|
|
|
|||
Genentech
|
|
43
|
%
|
|
70
|
%
|
|
71
|
%
|
Biogen
|
|
24
|
%
|
|
9
|
%
|
|
10
|
%
|
Depomed
|
|
13
|
%
|
|
9
|
%
|
|
7
|
%
|
|
|
December 31,
|
||||||
(In thousands)
|
|
2016
|
|
2015
|
||||
Depomed
|
|
$
|
6,000
|
|
|
$
|
—
|
|
Cardinal Health
|
|
7,663
|
|
|
—
|
|
||
McKesson
|
|
9,135
|
|
|
—
|
|
||
AmerisourceBergen
|
|
8,039
|
|
|
—
|
|
||
Other
|
|
9,283
|
|
|
—
|
|
||
Total receivables from licensee and other
|
|
$
|
40,120
|
|
|
$
|
—
|
|
|
|
December 31,
|
||||||
(In thousands)
|
|
2016
|
|
2015
|
||||
United States
|
|
$
|
13
|
|
|
$
|
31
|
|
Ireland
|
|
25
|
|
|
—
|
|
||
Total long-lived assets
(1)
|
|
$
|
38
|
|
|
$
|
31
|
|
|
|
Three Months Ended
|
||||||||||||||
|
|
December 31,
2016
|
|
September 30,
2016
|
|
June 30,
2016
|
|
March 31,
2016
|
||||||||
Total revenues
|
|
$
|
66,492
|
|
|
$
|
53,638
|
|
|
$
|
21,047
|
|
|
$
|
103,124
|
|
Net income attributable to noncontrolling interests
|
|
$
|
(10,336
|
)
|
|
$
|
13,907
|
|
|
$
|
4,148
|
|
|
$
|
55,887
|
|
Net income per basic share
|
|
$
|
(0.06
|
)
|
|
$
|
0.08
|
|
|
$
|
0.03
|
|
|
$
|
0.34
|
|
Net income per diluted share
|
|
$
|
(0.06
|
)
|
|
$
|
0.08
|
|
|
$
|
0.03
|
|
|
$
|
0.34
|
|
|
|
Three Months Ended
|
||||||||||||||
|
|
December 31,
2015
|
|
September 30,
2015
|
|
June 30,
2015
|
|
March 31,
2015
|
||||||||
Total revenues
|
|
$
|
178,058
|
|
|
$
|
124,618
|
|
|
$
|
138,066
|
|
|
$
|
149,706
|
|
Net income attributable to noncontrolling interests
|
|
$
|
100,574
|
|
|
$
|
69,459
|
|
|
$
|
78,264
|
|
|
$
|
84,498
|
|
Net income per basic share
|
|
$
|
0.61
|
|
|
$
|
0.42
|
|
|
$
|
0.48
|
|
|
$
|
0.52
|
|
Net income per diluted share
|
|
$
|
0.61
|
|
|
$
|
0.42
|
|
|
$
|
0.47
|
|
|
$
|
0.50
|
|
(a)
|
The following documents are filed as part of this Annual Report on Form 10-K:
|
(1)
|
Financial Statements - See Index to Consolidated Financial Statements at Item 8 of this Annual Report on Form 10-K.
|
(2)
|
Financial Statement Schedules
|
(3)
|
Exhibits required by Item 601 of Regulation S-K
|
|
PDL BIOPHARMA, INC.
|
|
|
|
|
|
|
By:
|
|
/S/ JOHN P. MCLAUGHLIN
|
|
|
|
John P. McLaughlin
|
|
|
|
President and Chief Executive Officer
|
|
|
|
|
|
Date:
|
March 1, 2017
|
|
Signature
|
Title
|
Date
|
|
|
|
/S/ JOHN P. MCLAUGHLIN
|
President and Chief Executive Officer (Principal Executive Officer)
|
March 1, 2017
|
(John P. McLaughlin)
|
|
|
|
|
|
/S/ PETER S. GARCIA
|
Vice President and Chief Financial Officer (Principal Financial Officer)
|
March 1, 2017
|
(Peter S. Garcia)
|
|
|
|
|
|
/S/ STEFFEN PIETZKE
|
Controller and Chief Accounting Officer (Principal Accounting Officer)
|
March 1, 2017
|
(Steffen Pietzke)
|
|
|
|
|
|
/S/ PAUL EDICK
|
Director
|
March 1, 2017
|
(Paul Edick)
|
|
|
|
|
|
/S/ DAVID GRYSKA
|
Director
|
March 1, 2017
|
(David Gryska)
|
|
|
|
|
|
/S/ JODY S. LINDELL
|
Director
|
March 1, 2017
|
(Jody S. Lindell)
|
|
|
|
|
|
/S/ DR. SAMUEL SAKS
|
Director
|
March 1, 2017
|
(Dr. Samuel Saks)
|
|
|
|
|
|
/S/ PAUL W. SANDMAN
|
Director
|
March 1, 2017
|
(Paul W. Sandman)
|
|
|
|
|
|
/S/ HAROLD E. SELICK
|
Director
|
March 1, 2017
|
(Harold E. Selick)
|
|
|
Exhibit
Number |
Exhibit Title
|
|
|
2.1
|
Separation and Distribution Agreement, dated December 17, 2008, between the Company and Facet Biotech Corporation (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed December 23, 2008)
|
|
|
2.2
|
Amendment No. 1 to Separation and Distribution Agreement, dated January 20, 2009, between the Company and Facet Biotech Corporation (incorporated by reference to Exhibit 2.2 to Annual Report on Form 10-K filed March 2, 2009)
|
|
|
3.1
|
Restated Certificate of Incorporation effective March 23, 1993 (incorporated by reference to Exhibit 3.1 to Annual Report on Form 10-K filed March 31, 1993)
|
|
|
3.2
|
Certificate of Amendment of Certificate of Incorporation effective August 21, 2001 (incorporated by reference to Exhibit 3.3 to Annual Report on Form 10-K filed March 14, 2002)
|
|
|
3.3
|
Certificate of Amendment of Certificate of Incorporation effective January 9, 2006 (incorporated by reference to Exhibit 99.1 to Current Report on Form 8-K filed January 10, 2006)
|
|
|
3.4
|
Certificate of Designation, Preferences and Rights of the Terms effective August 25, 2006 (incorporated by reference to Exhibit 3.4 to Registration Statement on Form 8-A filed September 6, 2006)
|
|
|
3.5
|
Third Amended and Restated Bylaws effective December 4, 2014 (incorporated by reference to Exhibit 99.1 to Current Report on Form 8-K filed December 9, 2014)
|
|
|
3.6
|
Certificate of Amendment of Restated Certificate of Incorporation effective May 22, 2013 (incorporated by reference to Exhibit 4.4 to Registration Statement on Form S-3 filed June 21, 2013)
|
|
|
4.1
|
Indenture between the Company and The Bank of New York Mellon, N.A., dated November 1, 2010 (incorporated by reference to Exhibit 4.1 to Quarterly Report on Form 10-Q filed November 9, 2010)
|
|
|
4.2
|
Indenture between the Company and The Bank of New York Mellon, N.A., dated May 16, 2011 (incorporated by reference to Exhibit 4.1 to Quarterly Report on Form 10-Q filed July 29, 2011)
|
|
|
4.3
|
Supplemental Indenture between the Company and The Bank of New York Mellon, N.A., dated May 16, 2011 (incorporated by reference to Exhibit 4.1 to Current Report on Form 8-K filed May 16, 2011)
|
|
|
4.4
|
Indenture between the Company and The Bank of New York Mellon, N.A., dated January 5, 2012 (incorporated by reference to Exhibit 4.1 to Current Report on Form 8-K filed January 6, 2012)
|
|
|
4.5
|
Indenture between the Company and The Bank of New York Mellon Trust Company, N.A., dated February 12, 2014 (incorporated by reference to Exhibit 4.1 to Current Report on Form 8-K filed February 12, 2014)
|
|
|
4.6
|
Supplemental Indenture between the Company and The Bank of New York Mellon Trust Company, N.A., dated February 12, 2014 (incorporated by reference to Exhibit 4.1 to Current Report on Form 8-K filed February 12, 2014)
|
|
|
4.7
|
Second Supplemental Indenture between the Company and The Bank of New York Mellon Trust Company, N.A., dated February 28, 2014 (incorporated by reference to Exhibit 4.9 to Annual Report on Form 10-K filed March 3, 2014)
|
|
|
4.8
|
Indenture between the Company and the Bank of New York Mellon Trust Company, N.A., dated November 22, 2016 (incorporated by reference to Exhibit 4.1 to Current Report on Form 8-K filed November 28, 2016)
|
|
|
4.9
|
Supplemental Indenture between the Company and The Bank of New York Mellon Trust Company, N.A., dated November 22, 2016 (incorporated by reference to Exhibit 4.2 to Current Report on Form 8-K filed November 28, 2016)
|
|
|
10.1*
|
1999 Stock Option Plan (incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q filed August 9, 2006)
|
|
|
10.2*
|
1999 Nonstatutory Stock Option Plan, as amended through February 20, 2003 (incorporated by reference to Exhibit 10.3 to Quarterly Report on Form 10-Q filed August 9, 2006)
|
|
|
10.3*
|
Form of Notice of Grant of Stock Option under the 1999 Stock Option Plan (incorporated by reference to Exhibit 10.2 to Quarterly Report on Form 10-Q filed August 14, 2002)
|
|
|
10.4*
|
Form of Stock Option Agreement (incentive stock options) under the 1999 Stock Option Plan (incorporated by reference to Exhibit 10.4 to Quarterly Report on Form 10-Q filed August 9, 2006)
|
|
|
10.5*
|
Form of Stock Option Agreement (nonstatutory stock options) under the 1999 Stock Option Plan (incorporated by reference to Exhibit 10.5 to Quarterly Report on Form 10-Q filed August 9, 2006)
|
|
|
10.6*
|
Form of Notice of Grant of Stock Option under the 1999 Nonstatutory Stock Option Plan (incorporated by reference to Exhibit 10.3 to Quarterly Report on Form 10-Q/A filed November 14, 2007)
|
|
|
10.7*
|
Form of Stock Option Agreement under the 1999 Nonstatutory Stock Option Plan (incorporated by reference to Exhibit 10.6 to Quarterly Report on Form 10-Q filed August 9, 2006)
|
|
|
10.8*
|
2002 Outside Directors Stock Option Plan, as amended June 8, 2005 (incorporated by reference to Exhibit 99.2 to Current Report on Form 8-K filed June 14, 2005)
|
|
|
10.9*
|
Form of Nonqualified Stock Option Agreement under the 2002 Outside Directors Plan (incorporated by reference to Exhibit 10.2 to Quarterly Report on Form 10-Q/A filed November 14, 2007)
|
|
|
10.10*
|
Amended and Restated 2005 Equity Incentive Plan effective June 4, 2009 (incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q filed July 31, 2009)
|
|
|
10.11*
|
Form of Notice of Grant of Stock Option under the 2005 Equity Incentive Plan (incorporated by reference to Exhibit 10.7 to Quarterly Report on Form 10-Q filed August 9, 2006)
|
|
|
10.12*
|
Form of Stock Option Agreement under the 2005 Equity Incentive Plan (incorporated by reference to Exhibit 10.8 to Quarterly Report on Form 10-Q filed August 9, 2006)
|
|
|
10.13*
|
Form of Notice of Grant of Restricted Stock Award under the 2005 Equity Incentive Plan (incorporated by reference to Exhibit 10.9 to Quarterly Report on Form 10-Q filed August 9, 2006)
|
|
|
10.14*
|
Form of Restricted Stock Agreement under the 2005 Equity Incentive Plan (for the officers of the Company) (incorporated by reference to Exhibit 10.10 to Quarterly Report on Form 10-Q filed August 9, 2006)
|
|
|
10.15*
|
Form of Director and Officer Indemnification Agreement (incorporated by reference to Exhibit 10.1 to Registration Statement on Form S-1 filed December 16, 1991)
|
|
|
10.16*
|
Offer Letter between the Company and John McLaughlin, dated November 4, 2008 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed November 10, 2008)
|
|
|
10.17
|
Tax Sharing and Indemnification Agreement, dated December 18, 2008, between the Company and Facet Biotech Corporation (incorporated by reference to Exhibit 10.3 to Current Report on Form 8-K filed December 23, 2008)
|
|
|
10.18
|
Patent Licensing Master Agreement between the Company and Genentech, Inc., dated September 25, 1998 (incorporated by reference to Exhibit 10.10 to Quarterly Report on Form 10-Q filed November 16, 1998)†
|
|
|
10.19
|
Amendment No. 1 to Patent Licensing Master Agreement between the Company and Genentech, Inc., dated September 18, 2003 (incorporated by reference to Exhibit 10.45 to Annual Report on Form 10-K filed
March 8, 2004)† |
|
|
10.20
|
Amendment No. 2 to Patent Licensing Master Agreement between the Company and Genentech, Inc., dated December 18, 2003 (incorporated by reference to Exhibit 10.45 to Annual Report on Form 10-K filed March 2, 2009)
|
|
|
10.21
|
Amendment No. 1 to the Herceptin License Agreement between the Company and Genentech, Inc., dated December 18, 2003 (incorporated by reference to Exhibit 10.47 to Annual Report on Form 10-K filed March 8, 2004)
|
|
|
10.22
|
Patent License Agreement, dated July 17, 1997, between the Company and MedImmune Inc. (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed January 24, 2011)†
|
|
|
10.23
|
Patent License Agreement, dated April 24, 1998, between the Company and Elan International Services Ltd. (incorporated by reference to Exhibit 10.45 to Annual Report on Form 10-K filed March 2, 2009) †
|
|
|
10.24*
|
Offer Letter between the Company and Christopher Stone, dated December 30, 2008 (incorporated by reference to Exhibit 10.29 to Annual Report on Form 10-K filed March 1, 2010)
|
|
|
10.25
|
Settlement Agreement between the Company and Genentech, Inc., dated December 18, 2003 (incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q filed November 9, 2010) †
|
|
|
10.26
|
Amended and Restated Patent Licensing Master Agreement between the Company and Genentech, Inc., dated July 27, 2009 (incorporated by reference to Exhibit 10.2 to Quarterly Report on Form 10-Q filed November 9, 2010) †
|
|
|
10.27
|
Amendments to Product Licenses and Settlement Agreement between the Company and Genentech, Inc. dated July 27, 2009 (incorporated by reference to Exhibit 10.3 to Quarterly Report on Form 10-Q filed November 9, 2010)
|
|
|
10.28*
|
Offer Letter between the Company and Danny Hart, dated January 11, 2010 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed April 18, 2011)
|
|
|
10.29*
|
Form of Executive Officer Severance Agreement (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed May 26, 2011)
|
|
|
10.30
|
Form of Exchange Agreement between the Company and certain holders of the Company’s 2.875% Convertible Senior Notes due February 15, 2015 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed February 2, 2012)
|
10.31
|
Lease Agreement between 932936, LLC and the Company, dated April 17, 2012 (incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q filed May 3, 2012)
|
|
|
10.32
|
Revenue Interests Purchase Agreement between the Company and AxoGen, Inc., dated October 5, 2012 (incorporated by reference to Exhibit 10.49 to Annual Report on Form 10-K filed March 1, 2013)†
|
|
|
10.33
|
Credit Agreement between the Company and Wellstat Diagnostics, LLC, dated November 2, 2012 (incorporated by reference to Exhibit 10.50 to Annual Report on Form 10-K filed March 1, 2013)†
|
|
|
10.34*
|
Offer Letter between the Company and Peter Garcia, dated March 27, 2013 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed April 29, 2013)
|
|
|
10.35*
|
2014 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q filed May 9, 2013)
|
|
|
10.36*
|
Offer Letter between the Company and David Montez, executed July 4, 2013 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed July 24, 2013)
|
|
|
10.37
|
Credit Agreement between the Company and Avinger, Inc., dated April 18, 2013 (incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q filed August 8, 2013)†
|
|
|
10.38
|
Amended and Restated Credit Agreement between the Company and Wellstat Diagnostics, LLC, dated August 15, 2013 (incorporated by reference to Exhibit 10.2 to Quarterly Report on Form 10-Q filed November 6, 2013)†
|
|
|
10.39
|
Form of Exchange Agreement between the Company and certain holders of the Company’s 2.875% Convertible Senior Notes due 2015 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed February 7, 2014)
|
|
|
10.40
|
Form of Purchase Agreement between the Company and a certain holder of the Company’s 2.875% Convertible Senior Notes due 2015 (incorporated by reference to Exhibit 10.2 to Current Report on Form 8-K filed February 7, 2014)
|
|
|
10.41
|
Form of Credit Agreement between the Company and certain borrowers (incorporated by reference to Exhibit 10.56 to Annual Report on Form 10-K filed March 3, 2014)
|
|
|
10.42
|
Credit Agreement among the Company, as borrower, the lenders from time to time party thereto and Royal Bank of Canada, as administrative agent, dated as of October 28, 2013 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed October 30, 2013)
|
|
|
10.43
|
Royalty Purchase and Sale Agreement between the Company and Depomed, Inc. and Depo DR Sub, LLC, dated October 18, 2013 (incorporated by reference to Exhibit 10.58 to Annual Report on Form 10-K filed March 3, 2014)†
|
|
|
10.44*
|
2014 Annual Bonus Plan (incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q filed May 12, 2014)
|
|
|
10.45
|
Settlement Agreement among Genentech, Inc., F. Hoffman-la Roche Ltd. and the Company, dated January 31, 2014 (incorporated by reference to Exhibit 10.2 to Quarterly Report on Form 10-Q filed May 12, 2014)†
|
|
|
10.46
|
Summary of omitted Credit Agreement between PDL BioPharma, Inc. and Paradigm Spine, LLC, dated February 14, 2014 (incorporated by reference to Exhibit 10.5 to Quarterly Report on Form 10-Q filed May 12, 2014)
|
|
|
10.47
|
Note Purchase Agreement between the Company and Accel 300, LLC, dated April 1, 2014 (incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q filed August 18, 2014)
|
|
|
10.48*
|
2014/18 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.2 to Quarterly Report on Form 10-Q filed August 18, 2014)
|
|
|
10.49
|
First Amendment to Lease Agreement between 932936, LLC and the Company, effective May 27, 2014 (incorporated by reference to Exhibit 10.3 to Quarterly Report on Form 10-Q filed August 18, 2014)
|
|
|
10.50
|
First Amendment to Amended and Restated Credit Agreement between the Company and Wellstat Diagnostics, LLC, dated June 19, 2014 (incorporated by reference to Exhibit 10.4 to Quarterly Report on Form 10-Q filed August 18, 2014)†
|
|
|
10.51
|
Amendment No. 1 to Credit Agreement among the Company, as borrower, the lenders from time to time party thereto and Royal Bank of Canada, as administrative agent, dated as of October 28, 2013 (incorporated by reference to Exhibit 10.5 to Quarterly Report on Form 10-Q filed August 18, 2014)
|
|
|
10.52
|
Amendment No. 2 to Credit Agreement among the Company, as borrower, the lenders from time to time party thereto and Royal Bank of Canada, as administrative agent, dated as of July 2, 2014 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed July 7, 2014)
|
|
|
10.53
|
Second Amendment to Amended and Restated Credit Agreement between the Company and Wellstat Diagnostics, LLC, dated August 21, 2014 (incorporated by reference to Exhibit 10.64 to Annual Report on Form 10-K filed February 23, 2015)†
|
|
|
10.54
|
Third Amendment to Amended and Restated Credit Agreement between the Company and Wellstat Diagnostics, LLC, dated November 4, 2014 (incorporated by reference to Exhibit 10.65 to Annual Report on Form 10-K filed February 23, 2015)†
|
|
|
10.55
|
Exchange Agreement between Tang Capital Partners, LP and the Company, dated October 20, 2014 (incorporated by reference to Exhibit 10.66 to Annual Report on Form 10-K filed February 23, 2015)
|
|
|
10.56
|
Schedule of Amendment to Omitted Credit Amendment between PDL BioPharma, Inc. and Direct Flow Medical (incorporated by reference to Exhibit 10.67 to Annual Report on Form 10-K filed February 23, 2015)
|
|
|
10.57
|
Credit Agreement among the Company, as borrower, the lenders from time to time party thereto and Royal Bank of Canada, as administrative agent, dated as of March 31, 2015 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed April 1, 2015)
|
|
|
10.58*
|
2015 Annual Bonus Plan (incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q filed May 6, 2015)
|
|
|
10.59*
|
2015/19 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.2 to Quarterly Report on Form 10-Q filed May 6, 2015)
|
|
|
10.60*
|
Employment Separation and Consultant Agreement between the Company and David L. Montez, executed April 21, 2015 (incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q filed August 5, 2015)
|
|
|
10.61*
|
Offer Letter between the Company and Steffen Pietzke, executed May 19, 2015 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed June 24, 2015)
|
|
|
10.62
|
Second Amendment to Lease Agreement between 932936, LLC and the Company, effective May 19, 2015 (incorporated by reference to Exhibit 10.3 to Quarterly Report on Form 10-Q filed August 5, 2015)
|
|
|
10.63*
|
Amended and Restated 2005 Equity Incentive Plan effective May 28, 2015 (incorporated by reference to Exhibit 10.4 to Quarterly Report on Form 10-Q filed August 5, 2015)
|
|
|
10.64*
|
Amended and Restated 2015 Annual Bonus Plan (incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q filed November 4, 2015)
|
|
|
10.65*
|
Amended and Restated 2015/19 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.2 to Quarterly Report on Form 10-Q filed November 4, 2015)
|
|
|
10.66
|
Revenue Interest Assignment Agreement, dated as of July 28, 2015, between ARIAD Pharmaceuticals, Inc. and the Company (incorporated by reference to Exhibit 10.3 to Quarterly Report on Form 10-Q filed November 4, 2015)†
|
|
|
10.67
|
Schedule of Amendments to Omitted Credit Amendments between PDL BioPharma, Inc. and LENSAR, Inc. and between PDL BioPharma, Inc. and Paradigm Spine, LLC
|
|
|
10.68*
|
2016 Annual Bonus Plan (incorporated by reference to Exhibit 10.1 to Quarterly Report on Form 10-Q filed May 4, 2016)
|
|
|
10.69*
|
2016/20 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.2 to Quarterly Report on Form 10-Q filed May 4, 2016)
|
|
|
10.70
|
Asset Purchase Agreement between Novartis AG, Novartis Pharma AG, Speedel Holding AG and Noden Pharma DAC, dated as of May 24, 2016 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K/A filed August 3, 2016)†
|
|
|
10.71
|
Schedule of Amendment to Omitted Credit Agreement between PDL BioPharma, Inc. and Direct Flow Medical, Inc. (incorporated by reference to Exhibit 10.2 to Quarterly Report on Form 10-Q filed August 4, 2016)
|
|
|
10.72
|
Amendment No. 1 to RIAA between ARIAD Pharmaceuticals, Inc. and PDL BioPharma, Inc., dated as of May 9, 2016 (incorporated by reference to Exhibit 10.3 to Quarterly Report on Form 10-Q filed August 4, 2016)†
|
|
|
10.73
|
Supply Agreement between Novartis Pharma AG and Noden Pharma DAC, dated as of May 24, 2016 (incorporated by reference to Exhibit 10.4 to Quarterly Report on Form 10-Q filed August 4, 2016)†
|
|
|
10.74
|
Noden Pharma DAC Investment and Stockholders’ Agreement by and among Noden Pharma DAC, PDL BioPharma, Inc., Elie Farah and other Persons listed on Annex A thereto, dated as of July 1, 2016 (incorporated by reference to Exhibit 10.5 to Quarterly Report on Form 10-Q filed August 4, 2016)†
|
|
|
10.75#
|
Schedule of Amendment to Omitted Credit Amendment between PDL BioPharma, Inc. and LENSAR, Inc.
|
|
|
12.1#
|
Ratio of Earnings to Fixed Charges
|
|
|
21.1#
|
Subsidiaries of the Registrant
|
|
|
23.1#
|
Consent of Independent Registered Public Accounting Firm
|
|
|
31.1#
|
Certification of Principal Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended
|
|
|
31.2#
|
Certification of Principal Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended
|
|
|
32.1#+
|
Certifications of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
101.INS
|
XBRL Instance Document
|
|
|
101.SCH
|
XBRL Taxonomy Extension Schema
|
|
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase
|
|
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase
|
|
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase
|
|
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase
|
#
|
Filed herewith.
|
|
|
*
|
Management contract or compensatory plan or arrangement.
|
|
|
†
|
Certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission pursuant to a confidential treatment request under 17 C.F.R. Sections 200.80(b)(4) and 24b-2.
|
+
|
The certifications attached as Exhibit 32.1 accompany this Annual Report on Form 10-K pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and shall not be deemed “filed” by the Registrant for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.
|
Execution Date
|
Borrower
|
Maturity Date
|
Amount Funded at Closing
|
Additional Available Credit
|
Additional Available Credit Funding Conditions
|
Outstanding Borrowings Interest Rate Per Annum
|
Interest Only Period
|
Principal Repayment Schedule
|
Change of Control Fee
|
December 16, 2016
|
LENSAR, Inc. (successor to LENSAR,LLC)
|
No change (December 15, 2020)
|
The Borrower is assuming $48.9 million in obligations outstanding under the previously amended and restated credit agreement.
|
None
|
Not applicable.
|
No change to interest rate; however, the Borrower no longer has the option to elect to pay interest in kind
|
No longer applicable
|
The full amount of the outstanding loans is due on the Maturity Date
|
No longer applicable
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
For the Years Ended December 31,
|
|||||||||||||||||||
|
|
2012
|
|
2013
|
|
2014
|
|
2015
|
|
2016
|
||||||||||
Earnings:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income before income taxes
|
|
$
|
327,133
|
|
|
$
|
401,876
|
|
|
$
|
501,272
|
|
|
$
|
530,138
|
|
|
$
|
106,670
|
|
Add: fixed charges
|
|
29,097
|
|
|
24,931
|
|
|
39,274
|
|
|
27,123
|
|
|
18,330
|
|
|||||
Earnings
|
|
$
|
356,230
|
|
|
$
|
426,807
|
|
|
$
|
540,546
|
|
|
$
|
557,261
|
|
|
$
|
125,000
|
|
Fixed Charges:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense
1
|
|
$
|
29,036
|
|
|
$
|
24,871
|
|
|
$
|
39,211
|
|
|
$
|
27,059
|
|
|
$
|
18,267
|
|
Estimated interest portion of rent expense
2
|
|
61
|
|
|
60
|
|
|
63
|
|
|
64
|
|
|
63
|
|
|||||
Fixed charges
|
|
$
|
29,097
|
|
|
$
|
24,931
|
|
|
$
|
39,274
|
|
|
$
|
27,123
|
|
|
$
|
18,330
|
|
Ratio of earnings to fixed charges
|
|
12.24
|
|
|
17.12
|
|
|
13.76
|
|
|
20.55
|
|
|
6.82
|
|
NAME OF SUBSIDIARY OR ORGANIZATION
|
|
STATE OF INCORPORATION OR
FORMATION |
|
|
|
Noden Pharma DAC
|
|
Republic of Ireland
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Noden Pharma USA, Inc.
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Delaware
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DFM, LLC
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Delaware
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/s/ JOHN P. MCLAUGHLIN
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John P. McLaughlin
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President and Chief Executive Officer
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(Principal Executive Officer)
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/s/ PETER S. GARCIA
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Peter S. Garcia
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Vice President and Chief Financial Officer
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(Principal Financial Officer)
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By:
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/s/ JOHN P. MCLAUGHLIN
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John P. McLaughlin
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President and Chief Executive Officer
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(Principal Executive Officer)
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By:
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/s/ PETER S. GARCIA
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Peter S. Garcia
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Vice President and Chief Financial Officer
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(Principal Financial Officer)
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(1)
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This certification accompanies the Annual Report on Form 10-K to which it relates, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of PDL BioPharma, Inc. under the Securities Act of 1933, as amended, or the Exchange Act (whether made before or after the date of the Form 10-K), irrespective of any general incorporation language contained in such filing. A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 has been provided to PDL BioPharma, Inc. and will be retained by PDL BioPharma, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.
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