Cramer also has a pick of underperforming management and activist activity.  This pick is PDL BioPharma (PDLI-NASDAQ).  The company gets royalties from Avastin and Herceptin from Genentech, but the company has made many bad decisions.  PDLI now has an activist investor called Third Point LLC that wanst a board seat.  This group is experienced, and now they think the stock should be worth $39 to $59 instead of the $20+ area now.  They have invested in NABI and LGND as past investments.  Cramer thinks that PDLI can be "un-locked" with Third Point.  Cramer thinks the contracts with Genentech are good through 2014 anhd they are worth $16.00 per share.  They spent $500 million on a buyout that didn’t make sense. They spent more than $200 million on cap-ex as they thought that they were going to have a drug of their own with an FDA approval.  He thinks it has $4.00 downside and has $20.00 or more in upside.

Jon C. Ogg
March 26, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.