UPDATE 1-PDL says gets August royalty payment from Genentech

* Sees Q3 rev of $86 mln vs est $83.6 mln

* Says responds to Genentech patent letter

* Says files complaint against Genentech in Nevada court

By Krishnakali Sengupta

BANGALORE, Sept 1 (BestGrowthStock) – PDL BioPharma Inc (PDLI.O: )
said it received all royalty payments due in August from
licensee Genentech, relieving concerns that it would not see
some of the money after the biotech giant said its products did
not infringe PDL’s patents.

On Aug. 13, PDL said Genentech, a unit of Roche Holding AG
(ROG.VX: ), sent it a letter disputing the scope of the European
patents covering its antibody humanization technology, for
which Genentech pays royalties amounting to a third of PDL’s
sales. [ID:nSGE67C0ER]

In a reply to Genentech Tuesday, PDL said the assertions
were without merit, and cautioned that Genentech had waived its
right to challenge the validity of PDL’s patent rights as part
of a 2003 settlement.

“The royalty payment was due (Monday), and they paid the
full amount without any reservations,” PDL Chief Executive John
McLaughlin told Reuters.

In a statement Wednesday, the company also said it filed a
complaint in the Second Judicial District of Nevada to enforce
its rights under the 2003 settlement, under which Genentech
agreed that the PDL patents are valid and cannot be challenged
without facing substantial damages.

“(But) we have not yet served the complaint on Genentech,”
McLaughlin said, as “we hope that this disagreement will be
resolved amicably.”

PDL also forecast third-quarter revenue slightly above Wall
Street estimates on higher sales of drugs that license its
technology, including the ones involved in the ongoing patent
dispute.

The company forecast third-quarter revenue of about $86
million, compared with analysts’ consensus estimate of $83.6
million in the period.

The company’s shares, which have fallen 8 percent since the
news of Genentech’s patent letter, closed at $5.67 Tuesday on
Nasdaq.
(Reporting by Krishnakali Sengupta in Bangalore; Editing by
Anthony Kurian, Aradhana Aravindan)

UPDATE 1-PDL says gets August royalty payment from Genentech