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1. Company Snapshot

1.a. Company Description

Ligand Pharmaceuticals Incorporated, a biopharmaceutical company, focuses on developing or acquiring technologies that help pharmaceutical companies to discover and develop medicines worldwide.Its commercial programs include Kyprolis and Evomela, which are used to treat multiple myeloma; Veklury for the treatment of moderate or severe COVID-19; Teriparatide injection product for osteoporosis; Vaxneuvance for the prevention of invasive disease caused by Streptococcus pneumoniae; and Pneumosil, a pneumococcal conjugate vaccine to help fight against pneumococcal pneumonia among children.The company also offers Rylaze, a recombinant erwinia asparaginase for the treatment of acute lymphoblastic leukemia or lymphoblastic lymphoma in adult and pediatric patients; and Nexterone, a captisol-enabled formulation of amiodarone; and Zulresso, a captisol-enabled formulation of brexanolone for the treatment of postpartum depression.


In addition, it provides Noxafil-IV, a captisol-enabled formulation of posaconazole for IV use; Duavee for the treatment of postmenopausal osteoporosis; Aziyo portfolio of commercial pericardial repair and CanGaroo envelope extracellular matrix products; Exemptia for autoimmune diseases; Vivitra for breast cancer; Bryxta and Zybev for various indications; and Minnebro for the treatment of hypertension.The company's partners and licenses programs, which are in clinical development used for the treatment of cancer, seizure, diabetes, cardiovascular disease, muscle wasting, liver and kidney disease, and other diseases.Further, it sells Captisol materials.


The company was incorporated in 1987 and is headquartered in Emeryville, California.

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1.b. Last Insights on LGND

Ligand Pharmaceuticals' recent performance was driven by strong Q2 2025 results, with revenue growth of 15% and non-GAAP EPS of $1.60, exceeding analyst estimates. The company's portfolio royalty revenue surged 57%, fueling the growth. Ligand raised its 2025 revenue guidance to $200-$225 million and adjusted EPS to $6.70-$7.00. Additionally, the company completed a $400 million convertible senior notes offering and announced a partnership for its Captisol-enabled product, Lasix ONYU, which received FDA approval. Institutional investors, such as Yousif Capital Management LLC, have also increased their stakes in the company.

1.c. Company Highlights

2. Ligand Pharmaceuticals' Q3 2025 Earnings: A Strong Performance Driven by Royalty Growth

Ligand Pharmaceuticals reported a robust third-quarter 2025 financial performance, with total revenue and other income reaching $115.5 million, up from $51.8 million in Q3 2024. The significant increase was driven by the commercial launch of ZELSUVMI, strong launches of Merck's Ohtuvayre and CAPVAXIVE, and growth of Recordati's QARZIBA and Travere's FILSPARI. Adjusted EPS came in at $3.09, beating estimates of $1.97. On an adjusted basis, core revenue grew 68% year-over-year to $86.9 million, with royalty revenue rising 47% to $46.6 million.

Publication Date: Nov -26

📋 Highlights
  • Revenue Growth: 47% YoY to $115.5M driven by ZELSUVMI, Ohtuvayre, CAPVAXIVE, QARZIBA, and FILSPARI.
  • Adjusted EPS Increase: 68% YoY, with $1B deployable capital and full-year core revenue guidance raised to $225–235M.
  • Convertible Debt Financing: $460M raised, strengthening balance sheet with $665M cash/investments at quarter-end.
  • Royalty Portfolio Growth: 5-year CAGR on track for ≥22%, with FILSPARI as top royalty asset ($46.6M Q3 royalty revenue).
  • Pelthos Deconsolidation: Generated $53M gain, with $180M estimated fair value for remaining holdings post-spinout.

Royalty Portfolio Performance

The company's royalty portfolio continues to drive growth, with FILSPARI becoming Ligand's largest royalty-generating asset on an annualized run rate basis. Ohtuvayre is tracking well ahead of initial forecasts, with Q3 sales growing 32% sequentially. The company expects its 5-year royalty receipts outlook to meet or exceed a 22% compound annual growth rate, with the existing portfolio supporting a royalty receipts CAGR of 18% and future investments expected to add at least 4%. As Todd Davis mentioned, "the current guidance is peak sales of $175 million, which we think is conservative," indicating potential upside for ZELSUVMI.

Strategic Investments and Capital Position

Ligand continues to expand its business development and investment teams, committing $35 million to Orchestra Bio for royalty interest and $11 million to Arecor for royalty rights. The company secured a $460 million convertible note in August, strengthening its balance sheet and increasing deployable capital to approximately $1 billion. The company's cash and investments stood at $665 million at the end of the quarter.

Valuation and Outlook

With a P/E Ratio of 110.01 and an EV/EBITDA of 268.09, the market appears to be pricing in significant growth expectations. Analysts estimate next year's revenue growth at -1.7%, which may indicate a challenging comparison. However, Ligand's robust royalty portfolio and strategic investments position the company for long-term growth. The company's ROE of 4.21% and ROIC of 1.8% suggest room for improvement in capital allocation. As the company prepares for its Investor Day on December 9, investors will be looking for updates on its pipeline and growth prospects.

3. NewsRoom

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Tweedy Browne's Strategic Moves: Alphabet Inc. Sees a -1.43% Portfolio Impact

Nov -20

Source: gurufocus.com

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This Fund Sold $9 Million of Ligand Stock After an 84% Rally — What Investors Should Know

Nov -17

Source: fool.com

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Envestnet Asset Management Inc. Acquires 769 Shares of Ligand Pharmaceuticals Incorporated $LGND

Nov -16

Source: defenseworld.net

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Private Capital's Strategic Moves: Spotlight on Matthews International Corp

Nov -14

Source: gurufocus.com

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Ligand Pharmaceuticals: Superb Q3/2025 With Second Guidance Raise Heralds Good Things To Come

Nov -13

Source: seekingalpha.com

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Ligand Pharmaceuticals Incorporated (LGND) Q3 2025 Earnings Call Transcript

Nov -08

Source: seekingalpha.com

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Ligand Reports Third Quarter 2025 Financial Results and Raises Guidance

Nov -06

Source: globenewswire.com

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Ligand to Participate in November Investor Conferences

Oct -30

Source: globenewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (13.00%)

6. Segments

Biopharmaceutical

Expected Growth: 13%

Ligand Pharmaceuticals' 13% growth in biopharmaceuticals is driven by increasing demand for novel therapeutics, strategic partnerships, and a strong pipeline of Captisol-enabled products. Additionally, the company's expertise in antibody omics and peptide technologies, as well as its growing presence in the oncology and rare disease markets, contribute to its growth momentum.

7. Detailed Products

Captisol

A chemically modified cyclodextrin, used to improve the solubility and stability of active pharmaceutical ingredients (APIs)

OmniAb

A transgenic animal platform used to generate high-affinity, fully human monoclonal antibodies

SKY59

A novel, orally bioavailable, small molecule inhibitor of the menin-MLL interaction

IAP

Inhibitor of Apoptosis Proteins (IAPs) antagonist, used to treat cancer

VBP

Vitamin D Binding Protein (VBP), used to treat various diseases, including cancer and autoimmune disorders

8. Ligand Pharmaceuticals Incorporated's Porter Forces

Forces Ranking

Threat Of Substitutes

Ligand Pharmaceuticals Incorporated operates in a highly competitive industry, and there are several substitutes available for its products. However, the company's strong brand recognition and customer loyalty mitigate the threat of substitutes to some extent.

Bargaining Power Of Customers

Ligand Pharmaceuticals Incorporated has a diverse customer base, which reduces the bargaining power of individual customers. Additionally, the company's products are often critical to its customers' operations, making it difficult for them to negotiate prices.

Bargaining Power Of Suppliers

Ligand Pharmaceuticals Incorporated relies on a few key suppliers for certain raw materials and services. While the company has some bargaining power due to its size and reputation, its suppliers also have some leverage due to the specialized nature of their products.

Threat Of New Entrants

The pharmaceutical industry has high barriers to entry, including significant regulatory hurdles and high research and development costs. This makes it difficult for new entrants to compete with established companies like Ligand Pharmaceuticals Incorporated.

Intensity Of Rivalry

The pharmaceutical industry is highly competitive, with many established companies competing for market share. Ligand Pharmaceuticals Incorporated faces intense competition from companies with similar products and technologies.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 0.87%
Debt Cost 8.55%
Equity Weight 99.13%
Equity Cost 8.55%
WACC 8.55%
Leverage 0.88%

11. Quality Control: Ligand Pharmaceuticals Incorporated passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Growth: 6.1

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Ligand Pharmaceuticals

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

184.87$

Current Price

184.87$

Potential

-0.00%

Expected Cash-Flows