By Puyaan Singh
April 27 (Reuters) – Ligand Pharmaceuticals will buy fellow biotechnology royalty aggregator XOMA Royalty for about $739 million in cash, the companies said on Monday.
The deal adds more than 120 treatments, including seven marketed products, boosting Ligand’s portfolio to more than 200 drugs that are in development or already on the market. Shares of XOMA surged 9.7%, while Ligand’s were up 1.6%.
Biotech royalty aggregators provide immediate cash to drug developers in exchange for economic rights to future royalty and milestone payments from the candidates the companies develop.
Here are further details on the deal:
• Ligand will pay $39 per XOMA share in cash, around 3% premium to the stock’s last close, for a total equity value of about $739 million.
• The seven marketed drugs Ligand gains include Roche’s Vabysmo, Servier’s Ojemda and Zevra’s Miplyffa. At peak, the company expects to earn royalties worth $37.5 million annually from eye drug Vabysmo, said Lauren Hay, Ligand’s portfolio strategy vice president.
• There will be one non-transferable contingent right per share entitled to 75% of net proceeds from certain pending litigation tied to XOMA’s dispute with Johnson & Johnson subsidiary Janssen around Crohn’s disease drug Tremfya.
• Ligand said the acquisition will be immediately accretive and raised its 2026 revenue outlook to a range of $270 million to $310 million, from $245 million to $285 million earlier.
• It also raised its annual adjusted profit forecast to $8.50 to $9.50 per share, up from $8 to $9 apiece, and expects a further $1.50-per-share boost in 2027.
• Ligand expects to retain capacity to continue executing on its strategy of investing $150 million to $250 million annually in high-value royalty assets, said finance chief Tavo Espinoza.
• CEO Todd Davis added, “we are … typically looking at deals in the $25 million to $60 million range. As our portfolio grows in value, the deal size could go up proportionately.”
(Reporting by Puyaan Singh in Bengaluru; Editing by Leroy Leo and Vijay Kishore)
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