Ligand Pharmaceuticals Inc (NASDAQ: LGND)

Ligand Pharmaceuticals Incorporated is a biopharmaceutical royalty company focused on deploying capital and licensing technologies to acquire and create diversified royalty streams from high value medicines. The company's primary business involves investing in and structuring royalty interests in mid to late stage development and commercial biopharmaceutical products. This approach generates long duration non dilutive cash flows supported by a lean corporate cost structure. Ligand also operates two infrastructure light royalty generating platform technologies Captisol and NITRICIL. These platforms provide existing royalty streams and potential for incremental royalties through partner driven development and commercialization. As of December 2025 Ligand reported 12 major commercial stage royalty assets generating the majority of its royalty revenue and maintained a pipeline of more than 90 additional commercial and development stage programs. The company spun off its OmniAb antibody discovery business in November 2022 and its Pelican Expression Technology subsidiary in September 2023 to sharpen its focus on royalty aggregation and platform technology ownership. Ligand's strategy emphasizes disciplined capital allocation portfolio construction and risk management while avoiding the high cost infrastructure typical of traditional drug developers.

Ligand generates revenue primarily from royalties on sales of products commercialized by its partners. In 2025 the company recorded total royalty receipts of $176.9 million from its portfolio of approved products. Major contributors included Kyprolis with a royalty rate ranging from 1.5 percent to 3.0 percent Qarziba with a tiered mid teen royalty Filspari with a 9 percent royalty Ohtuvayre with a 3 percent royalty Rylaze with a low single digit royalty Capvaxive and Vaxneuvance each with a low single digit royalty Evomela with a 20 percent royalty Nexterone with a low single digit royalty and Zelsuvmi with a 13 percent royalty. In addition to royalties Ligand earns revenue from Captisol material sales which include the sale of solid Captisol powder and cGMP manufactured aqueous concentrate to partners such as Gilead Amgen Baxter and Acrotech. The company also receives contract revenue in the form of license fees and milestone payments from development stage programs. For example Ligand received a $2 million milestone upon FDA approval of Capvaxive a $5 million milestone following the commercial launch of Zelsuvmi and various milestone payments tied to programs such as D Fi and AVIM therapy. The platform technologies also generate income through licensing arrangements; NITRICIL is leveraged in the FDA approved product Zelsuvmi and offers potential for additional royalties through partner led development of other indications. Captisol is protected by a broad global patent portfolio with the latest expiration date in 2033 and pending applications that could extend protection to 2041. NITRICIL leverages nitric oxide's antimicrobial and immunomodulatory properties to support therapies across multiple therapeutic areas.

Ligand occupies a distinctive position in the biopharmaceutical royalty sector as an aggregator that focuses on mid to late stage assets and infrastructure light platform technologies. The company competes with other royalty focused firms such as Royalty Pharma and various investment vehicles that pursue similar royalty acquisition strategies. Ligand's competitive advantages stem from its lean operating model which enables high margin returns and its ability to source transactions through confidential disclosure agreements providing access to non public data. The company's investment team has deep industry relationships and experience in structuring complex royalty financings. Ligand follows a disciplined investment process that includes proprietary origination a gated diligence framework term sheet development confirmatory diligence and a unanimous approval vote by its three member Investment Committee before entering into any binding agreement. Its platform technologies Captisol and NITRICIL provide scalable intellectual property with existing royalty streams and the potential for incremental revenue through partner driven development. Additionally Ligand's diversified portfolio across multiple therapeutic areas reduces reliance on any single product or clinical outcome thereby mitigating the binary risk inherent in drug development. The company's approach allows it to avoid the high cost infrastructure typical of traditional biotechnology firms while maintaining exposure to innovation through royalties.

Ligand serves a diverse customer base consisting of large multinational pharmaceutical companies mid size biotech firms and academic institutions that partner with the company to access its royalty interests or platform technologies. Specific customers include Amgen Ono BeOne Medicines for Kyprolis Recordati for Qarziba Travere for Filspari Merck for Ohtuvayre Capvaxive Vaxneuvance Jazz for Rylaze Alvogen and Adalvo for Teriparatide Acrotech and CASI for Evomela Baxter for Nexterone Pelthos for Zelsuvmi and Sanofi for Tzield. The company also supplies Captisol material to partners such as Gilead for Veklury Amgen for Kyprolis Baxter for Nexterone and Acrotech for Evomela. In addition Ligand has royalty relationships with Viking for its TR beta agonist programs VK2809 and VK0214 with LeonaBio and Henlius for lasofoxifene with Agenus for Botensilimab and Balstilimab with Orchestra BioMed for AVIM therapy and Virtue SAB with Arecor for AT220 and AT292 with Castle Creek Biosciences for D Fi and with Tolerance Therapeutics for Tzield. These relationships provide Ligand with royalty streams and material sales across oncology infectious disease cardiovascular immunology and other therapeutic areas. While the company does not sell directly to patients its partners ultimately deliver medicines to patients hospitals clinics and other healthcare providers worldwide.