Ligand Pharmaceuticals Incorporated

Ligand Pharmaceuticals has entered a US$47 million financing agreement with AvenCell Therapeutics, comprising up to US$6 million in Series C funding and as much as US$41 million tied to clinical milestones for AvenCell's CAR-T therapy programs. The deal deepens Ligand's royalty-focused model by adding potential royalty streams on AvenCell's current and future pipeline, further broadening its portfolio of over 200 partnered assets following the XOMA Royalty acquisition. The new milestone-linked exposure comes as Ligand faces partner execution questions, including a recent termination notice to Viking Therapeutics over the TR Beta program. Ligand's narrative projects $481.1 million in revenue and $273.9 million in earnings by 2029, with a fair value estimate of $342.82, a 9% upside to its current price. Before the AvenCell deal, the most optimistic analysts had already assumed revenue could reach about US$538 million and earnings about US$277 million by 2029.

Ligand Pharmaceuticals outlined its royalty-focused growth strategy, highlighting the XOMA acquisition that doubled its portfolio to more than 220 partnered programs and added seven commercial-stage assets, 14 late-stage programs, and over $2 billion in potential milestones. The company expects at least $1.50 in incremental adjusted EPS from XOMA next year, and second-quarter revenue rose 34% to $64 million with adjusted EPS up 48% to $2.37. Ligand raised the low end of its full-year adjusted EPS guidance to $9 and ended the quarter with $1.4 billion in cash and investments, retaining approximately $700 million in deployable capital after the acquisition. Key catalysts include FILSPARI's expansion, positive phase III data for Palvella's rapamycin program, and up to seven pivotal readouts by the end of 2027.

Ligand Pharmaceuticals reported second quarter total revenue of $63.7 million, up 34% year over year, and raised the lower end of its 2026 adjusted EPS guidance to $9.00 from $8.50, while maintaining the upper end at $9.50. Royalty revenue grew 32% to $48.0 million, driven by Filspari, Ohtuvayre, and Zelsuvmi, and adjusted diluted EPS rose 48% to $2.37. The company reaffirmed 2026 total revenue guidance of $270 million to $310 million and royalty revenue of $225 million to $250 million. Ligand also completed the acquisition of XOMA Royalty, adding over 120 commercial, clinical, and preclinical assets, and issued $700 million in 0% coupon convertible notes due 2031, leaving approximately $700 million in deployable capital.

Orchestra BioMed announced that its BACKBEAT global pivotal trial, conducted in collaboration with Medtronic, is on track to reach its target of 284 evaluable randomized patients by the end of the third quarter of 2026, with primary data presentation targeted for the second quarter of 2027. The company reported a cash balance of $110 million as of June 30, 2026, providing projected runway into the fourth quarter of 2027, following $35 million in strategic capital from Medtronic and Ligand during the quarter. AVIM Therapy received a second FDA Breakthrough Device Designation, now covering both the broad group of patients with uncontrolled hypertension and elevated cardiovascular risk and the pacemaker-indicated group studied in the BACKBEAT Trial. The Virtue pivotal trial for coronary in-stent restenosis is advancing with further site activations and patient enrollments. Orchestra BioMed will host an R&D Day on November 12, 2026, in New York City to review both programs.

Citi has resumed coverage of Ligand Pharmaceuticals with a buy rating, citing the company's acquisition of XOMA Royalty. The deal, valued at $739 million in equity, closed earlier in July and adds a significant number of late-stage assets along with a steady royalty stream. The bank set a price target of $387, implying a roughly 32% return based on the July 20 close. Analyst Yigal Nochomovitz noted that Ligand could significantly benefit from a contingent value right related to Johnson & Johnson's Tremfya once ongoing litigation is resolved, and will also gain from Xoma's key commercial drivers including Roche unit Genentech's Vabysmo, Day One Biopharmaceuticals' Ojemda, and Zevra Therapeutics' Miplyffa.

The Motley Fool selects Viking Therapeutics over Dyne Therapeutics as the better healthcare stock for 2026, citing the massive obesity-treatment market opportunity for Viking's weight-loss candidate VK2735. Both clinical-stage biotechs reported zero revenue and widening net losses in fiscal 2025, with Dyne posting a loss of nearly $446.2 million and Viking close to $359.6 million. Viking carries no debt and holds a current ratio of roughly 9.3x, while Dyne has a debt-to-equity ratio of 0.19x and a current ratio of approximately 22.3x. The analysis notes Dyne's focus on rare neuromuscular diseases limits its market size, whereas Viking's phase 3 obesity program targets a far larger patient population despite competition from Eli Lilly and Novo Nordisk. Viking also faces an investigation into potential securities-law violations and relies on a license agreement with Ligand Pharmaceuticals.

Ligand Pharmaceuticals completed its offering of 0.00% convertible senior notes due 2031, raising an aggregate principal amount of $700.0 million, which includes the full exercise of the initial purchasers' option to purchase an additional $75.0 million. Net proceeds were approximately $678.2 million after fees and expenses. Ligand used about $72.9 million of the net proceeds to pay for convertible note hedge transactions, and approximately $60.0 million to repurchase 228,859 shares of its common stock at $262.17 per share. The remaining net proceeds are intended for general corporate purposes, including the previously announced acquisition of XOMA Royalty Corporation. The convertible note hedge transactions are expected to reduce potential dilution upon conversion, while the warrant transactions could have a dilutive effect if the stock price exceeds the initial warrant strike price of $524.34 per share.