According to a press release dated November 7, 2006, on November 2, 2006, the United States District Court for the District of New Jersey dismissed with prejudice the Third Consolidated and Amended Class Action Complaint in connection with the lawsuit In re PDI Securities Litigation (Civil Action No.: 02-cv-0211-JLL). The action was originally filed in January 2002 against PDI, its former CEO and former CFO. The District Court issued an opinion and order dismissing with prejudice all claims asserted in the Third Amended Complaint against all defendants and denied plaintiffs request to amend the complaint.

In a press release dated October 26, 2005, on October 22, 2005, the plaintiffs filed a Third Consolidated and Amended Class Action Complaint. The Company believes that the allegations in this purported securities class action are without merit and intends to file a motion to dismiss the action.

In a press release dated August 22, 2005, PDI, Inc. announced that the United States District Court for the District of New Jersey has dismissed the Second Consolidated and Amended Class Action Complaint in In re PDI Securities Litigation (Civil Action No.: 02-cv-0211-JLL) without prejudice to plaintiffs. The action was originally filed in January 2002 against PDI, its CEO and CFO. In February 2003, PDI filed a motion to dismiss the Second Consolidated and Amended Complaint under the Private Securities Litigation Reform Act of 1995 and Rules 9(b) and 12(b)(6) of the Federal Rules of Civil Procedure.

The complaint charges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of materially false and misleading statements to the market between May 22, 2001 and November 12, 2001. For example, as alleged in the complaint, on May 22, 2001 the Company held a conference call regarding a
previously announced agreement with Novartis AG, under which PDI would market and sell Novartis' Lotensin and Lotrel, two hypertension medications. During the conference call, defendants represented that they expect the Novartis contract to add $0.25 per share to PDI's fourth quarter of 2001 results. That statement was, according to the complaint, materially false and misleading because defendants knew, or were reckless in not knowing, that PDI's marketing program would not be fully underway until well into the fourth quarter and that therefore, the agreement could not contribute materially to PDI's fourth quarter of 2001 performance. In addition, according to the complaint, PDI materially misled the investing public to the true impact that the introduction of generic competition for Ceftin -- a drug which the Company was distributing under contract with GlaxoSmithKline PLC ("Glaxo") -- would have on its business. In particular, the Complaint alleges that defendants represented, in an August 23, 2001 conference call, that PDI expected Ceftin to contribute $0.30-$0.40 earnings per share to the fourth quarter of 2001, even if a generic form of Ceftin was introduced during that time. According to the complaint, the statements were materially false and misleading because defendants knew, or were reckless in not knowing, that Ceftin could not contribute $0.30 per share to fourth quarter 2001 earnings. On November 12, 2001, the Company issued a press release announcing a net loss of $17.3 million, or $1.24 for the third quarter of 2001, including a $24 million charge as reserves for expenses associated with the Ceftin contract, which the Company announced would be terminated shortly. In addition, the Company announced that the Lotensin program will be completed late in the fourth quarter and would not contribute materially to PDI's 2001 earnings. On November 13, 2001, defendants held a conference call revealing that Ceftin would not contribute any profit to the fourth quarter of 2001. In reaction to the news, the price of PDI common stock plummeted from a $29 per share close on November 12, 2001 to close at $18.35 per share -- a drop of 35%.