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I’ll now turn the call over to John McLaughlin, President and CEO of PDL BioPharma.John McLaughlin Thanks, Jennifer, and good afternoon everyone. Also with me today is Caroline Krumel Vice President of Finance. As always in this call, I’ll provide a summary of recent events and an overview of our financial results from the quarter. As you can see in slide three, we were very pleased to announce last week that Bruce Tomlinson will be joining us as Vice President, CFO. Bruce joined us from InterMune, a public biopharmaceutical company where he was Chief Accounting Officer, Vice President of Finance and Corporate Controller. Bruce managed all accounting and treasury functions, financial reporting, systems and controls and Sarbanes-Oxley Compliance at InterMune. He brings more than 20 years of financial and management experience which is very relevant to PDL including knowledge of convertible debt transactions and tax structures. He will join us here in Incline Village on June 11 th and we will be happy to have him on board and know that you’ll be talking with him in the months ahead. Turning to our financial results on slide four, total revenues for the first quarter of 2012 were $77.3 million compared to $83.3 million for the first quarter of 2011. As we noted in the press release, total revenue for 2012 included a $10 million settlement payment from UCB Pharma resolving all disputes between our two companies. Excluding the UCB payment, royalty revenue increased a little over 5%. Royalty revenues for the first quarter of 2012 are based on fourth quarter 2011 sales by PDLs licensees. The growth in revenue for the first quarter of 2012 is primarily driven by increased royalties on sales of Herceptin, which is marketed by Genentech and Roche, Lucentis and Xolair both of which are marketed by Genentech and Novartis, and Tysabri which is marketed by Elan and Biogen Idec. Royalty revenue for the first quarter is net of payments made under our February 2011 settlement agreement with Novartis.
Turning to costs, our G&A expenses for the first quarter of 2012 were $6.9 million compared to $5.8 million in 2011. Total cash and equivalents as of March 31, 2012 were $192.5 million compared to $227.9 million as of December 31, 2011. The decrease in cash is primarily due to the second and final payment of $27.5 million to MedImmune under our February 20, 2011 settlement agreement.Net cash provided by operating activities in the first quarter of 2012 was $17.9 million compared with net cash used of $13.2 million in equivalent period of 2011. Net income for the first quarter of 2012 was $40.2 million or $0.29 per diluted share as compared with net income of $44.5 million in the same period of 2011 or $0.25 per diluted share. On slide five, you could see that adjusting for the effects of certain convertible note transactions and the resulting interesting expense, non-GAAP net income for the first quarter of 2012 on a fully diluted basis was $41.8 million or $0.30 per share compared to $44.5 million or $0.25 per share in that same period of 2011. In accordance with our regular quarterly dividend policy, we paid the first of four dividends on March 14 th to all stockholders of record as of March 7 th for a total of $21 million. You can see on slide six that, in connection with this dividend payment, the conversion price for the $1 million outstanding on our February 2015 notes is approximately $6.29 per share effective March 8, 2011. For our May 2015 notes, the conversion price is approximately $7.18 per share effective March 5, 2011. The conversion price for the new series 2012 notes is approximately $6.29 per share effective March 5, 2012. Read the rest of this transcript for free on seekingalpha.com