AxoGen, Inc. Completes $20.8 Million Financing with PDL BioPharma, Inc.

  AxoGen, Inc. Completes $20.8 Million Financing with PDL BioPharma, Inc.

Business Wire

ALACHUA, Fla. -- October 09, 2012

AxoGen, Inc. (AxoGen) (OTCBB: AXGN), and PDL BioPharma, Inc. (PDL) (NASDAQ:
PDLI), announced today that they closed a structured financing transaction on
October 5, 2012 in which PDL provided AxoGen with an aggregate of $20.8
million. AxoGen is a regenerative medicine company dedicated to advancing the
science and commercialization of surgical solutions for peripheral nerve

This financing allows AxoGen to strengthen and accelerate its sales and
marketing efforts as well as to explore pipeline opportunities.

The total financing of $20.8 million was provided pursuant to a Revenue
Interests Purchase Agreement that included $19.05 million in cash PDL paid to
AxoGen on October 5, 2012 and $1.75 million PDL paid to AxoGen on August 14,
2012 pursuant to an Interim Revenue Interest Purchase Agreement. Aggregate net
proceeds were approximately $14.0 million after repayment of $5.0 million in
existing debt and payment of transaction related fees and expenses. The
Revenue Agreement has an eight year term and provides PDL with royalties based
on AxoGen revenues, subject to certain minimum payment requirements beginning
in the fourth quarter of 2014 and the right to require AxoGen to repurchase
the revenue contract at the end of the fourth year. AxoGen has been granted
certain rights to call the revenue contract in years five through eight. In
addition, John McLaughlin, President and Chief Executive Officer of PDL, was
elected to the Board of Directors of AxoGen, Inc. immediately following the
closing. No equity securities or warrants were issued as part of this

“PDL is an exciting partner for AxoGen. The PDL team has a strong track record
of creating commercial value and their knowledge will be an asset as we build
AxoGen’s business,” said Karen Zaderej, CEO for AxoGen.

“The PDL transaction provided both operating capital and the ability to pay
off AxoGen’s existing bank debt,” offered Greg Freitag, AxoGen’s CFO and
General Counsel. “We were able to raise significant capital without diluting
our outstanding share-base while maintaining a clean capital structure.
Furthermore, our agreement provides extensive flexibility for future financing
and business development activity.”

“We are very impressed with the depth and breadth of experience in this
accomplished AxoGen team,” said John McLaughlin, President and Chief Executive
Officer of PDL. “AxoGen products are changing the way peripheral nerve repair
is performed, and PDL is pleased to have the opportunity to contribute to the
growth of this innovative business.”

JMP Securities acted as lead placement agent and Noble Financial Capital
Markets acted as co-placement agent for the transaction.

AxoGen Management Conference Call

AxoGen management will be hosting a conference call to discuss the transaction
on October 10, 2012 at 11:30 AM Eastern Time. The conference call information
is as follows:

Conference dial-in:       877-709-8150
International dial-in:       201-689-8354

About AxoGen, Inc.

AxoGen (OTCBB: AXGN) is a regenerative medicine company dedicated to advancing
the science and commercialization of peripheral nerve repair solutions.
AxoGen’s products offer a full suite of surgical nerve reconstruction
solutions including Avance® Nerve Graft, the only commercially available
processed nerve allograft for bridging severed nerves, AxoGuard® Nerve
Connector, a coaptation aid allowing for close approximation of severed
nerves, and AxoGuard® Nerve Protector, a bioscaffold used to reinforce a
coaptation site, wrap a partially severed nerve or isolate and protect nerve
tissue. For more information, visit our website at

AxoGen is the parent of its wholly owned operating subsidiary, AxoGen
Corporation. AxoGen’s principal executive office and operations are located in
Alachua, FL.

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About PDL BioPharma

PDL pioneered the humanization of monoclonal antibodies and, by doing so,
enabled the discovery of a new generation of targeted treatments for cancer
and immunologic diseases. Today, PDL is focused on intellectual property asset
management, investing in new revenue generating assets and maximizing the
value of its patent portfolio and related assets. For more information, please

Cautionary Statements Concerning Forward-Looking Statements

This Press Release contains “forward-looking” statements as defined in the
Private Securities Litigation Reform Act of 1995. These statements are based
on management’s current expectations or predictions of future conditions,
events or results based on various assumptions and management’s estimates of
trends and economic factors in the markets in which we are active, as well as
our business plans. Words such as “expects”, “anticipates”, “intends”,
“plans”, “believes”, “seeks”, “estimates”, “projects”, “forecasts”, “may”,
“should”, variations of such words and similar expressions are intended to
identify such forward-looking statements.The forward-looking statements may
include, without limitation, statements regarding product development, product
potential or financial performance. The forward-looking statements are subject
to risks and uncertainties, which may cause results to differ materially from
those set forth in the statements.Forward-looking statements in this release
should be evaluated together with the many uncertainties that affect the
business of both AxoGen and PDL and their markets, particularly those
discussed in the risk factors and cautionary statements in filings made by
AxoGen and PDL with the Securities and Exchange Commission.Forward-looking
statements are not guarantees of future performance, and actual results may
differ materially from those projected.The forward-looking statements are
representative only as of the date they are made, and neither AxoGen nor PDL
assumes any responsibility to update any forward-looking statements, whether
as a result of new information, future events or otherwise.


Rich Cockrell, 404-942-3369
AxoGen, Inc.
Greg Freitag, 386-462-6856
Chief Financial Officer
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