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Author: shuksan77 Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 24982  
Subject: Re: PDLI Date: 3/9/2012 10:29 PM
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I've owned it for a couple of years.

Bought as a dividend play only. PDLI has fixed this dividend on the low side so they can attack debt. IMO they are pretty shareholder-friendly.

They have a lot of cash with which they propose to purchase new royalty streams; heretofore this hasn't happened.

Most of the patents expire in 2014 and 2015. So the business will start into run-off (without new revenue streams)relatively soon. They have about 6-7 employees.

Current picture:

http://finance.yahoo.com/news/pdl-biopharma-provides-first-q...

Two large wild cards:

1. Bapineuzumab. If this actually works for Alzheimers then a potential revenue stream opens up. I don't know when this patent expires (or, at least, the revenue part of it for PDLI). There's also another mab in development for a-beta.

2. There is also litigation with Roche which may result in a windfall for PDLI. (Or, not)

I am kind of on the fence here. Mgmt hasn't shown a way forward--and, indeed, may not know what to do until some chips fall.

They have 2x debt as cash but have shown consistent interest in paying off debt and reducing interest charges.

There are probably dividend yields out there w/o so much uncertainty (I own plenty with uncertainty) but it is worth watching as now and then it dips into the mid $5's (where I own it) and gets awfully enticing...

--s
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