On December 13, 2022 Ligand Pharmaceuticals Incorporated (NASDAQ: LGND) reported that at today’s Investor and Analyst Day event its executive management provided an overview of Ligand’s corporate structure and business following the successful spin-off of its OmniAb antibody discovery business, reviewed Ligand’s recent progress and near-term partner milestones and provided an outlook for financial growth (Press release, Ligand, DEC 13, 2022, View Source [SID1234625213]). Management also introduced 2023 financial guidance and discussed its capital deployment strategy. A webcast of the event including slides is available here.

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Highlights of today’s event held in-person in New York City and virtually included the following:

Business Model and Growth Drivers

Management reviewed Ligand’s business model and the ongoing diversification of its partnership portfolio. Ligand shares in the promise of the biopharmaceutical industry through royalty economics earned from providing development capital and access to its platform technologies.
Management reviewed its capital deployment strategy, which is focused on providing developmental capital and acquiring scalable platform technologies, and noted that current market conditions have created a substantial number of M&A opportunities.
Today Ligand has economic rights to more than 100 programs being developed or commercialized by nearly 100 different partners. Ligand spotlighted the most advanced late-stage assets in its portfolio and reviewed 10 potential major pipeline events expected in 2023, including:
FDA approval of Travere’s Sparsentan for the treatment of IgA nephropathy;
NDA submission of Verona’s Ensifentrine for the treatment of COPD;
EMA approval of Jazz’s Rylaze for the treatment of ALL/LBL;
FDA approval of Novan’s Berdazimer gel for the treatment of molluscum;
Late-stage clinical data for Palvella’s QTORIN in pachyonychia congenita, MLM and Gorlin syndrome;
Late-stage clinical data for Marinus’ ganaxolone in refractory status epilepticus;
Phase 2b data for Vikings’ VK2809 in NASH;
FDA Therapeutic Equivalence rating of Alvogen’s teriparatide injection in reference to Forteo.
Management outlined the development status and market landscape of select pipeline programs including Travere’s Sparsentan, Verona’s Ensifentrine and Novan’s Berdazimer gel.
Management reviewed Ligand’s role in the manufacturing of Veklury (remdesivir) to treat COVID-19 and highlighted that cumulative sales of Captisol related to COVID between 2020 and 2022 are expected to exceed $300 million, providing Ligand with significant non-dilutive capital.
Management provided an overview and update on the Captisol and Pelican Expression Technology platforms, including recent partner progress.
Management reviewed the recently completed spin-off of OmniAb and the strength each company has as independent publicly traded companies.
Management discussed how intellectual property is fundamental to Ligand’s revenue streams, how innovations in its platform technologies can drive licensing opportunities, and the means it uses to protect potential returns in its transactions.
Ligand highlighted progress in Environmental, Social and Governance (ESG) initiatives, including a $2.5 million solar investment and water savings from innovative manufacturing techniques, and its continued future focus on such initiatives.
Financial Overview and Outlook

Management discussed Ligand’s strong revenue growth and its expectations for continued topline growth. Revenue growth has contributed to significant cash flow and earnings.
The company introduced 2023 financial guidance, as follows:
Total core revenue of $118 million to $122 million, comprised of $72 million to $76 million from royalties, $21 million from sales of Captisol (excluding COVID-related sales) and $25 million from contract revenue;
Total cash operating expenses of $46 million;
Adjusted diluted EPS of $3.10 to $3.30.
Ligand estimates that at the end of 2022 it will have $150 million of cash and investments available to fund its M&A initiatives.
Adjusted Financial Measures

The Company reports adjusted net income and adjusted net income per diluted share in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. The Company’s financial measures under GAAP include share-based compensation expense, non-cash interest expense, amortization related to acquisitions and intangible assets, changes in contingent liabilities, mark-to-market adjustments for amounts relating to its equity investments in public companies, excess tax benefit from share-based compensation, gross profit for Captisol sales related to COVID-19, net of tax, transaction costs and others that are listed in the itemized reconciliations between GAAP and adjusted financial measures included in its earnings releases for the year ended December 31, 2021 and the third quarter ended September 30, 2022, available here. However, the Company does not provide reconciliations of such forward-looking adjusted measures to GAAP due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliation, including adjustments that could be made for changes in contingent liabilities, changes in the market value of its investments in public companies, share-based compensation expense and the effects of any discrete income tax items. Management has excluded the effects of these items in its adjusted measures to assist investors in analyzing and assessing the Company’s past and future core operating performance. Additionally, adjusted earnings per diluted share is a key component of the financial metrics utilized by the Company’s board of directors to measure, in part, management’s performance and determine significant elements of management’s compensation.