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Ligand Pharmaceuticals Incorporated (LGND - Free Report) reported fourth-quarter 2022 adjusted diluted earnings of $1.36 per share from continuing operations, which beat the Zacks Consensus Estimate and our estimate of $1.23 per share. The company had reported adjusted earnings of $1.47 in the year-ago quarter.
The company additionally reported adjusted earnings of 75 cents per share, after excluding the impact of gross profit for Captisol sales related to COVID-19 which is on par with our estimate.
Total revenues of $50.4 million were down 10.6% from the year-ago quarter. The difference is attributable to the unfavorable timing of Captisol’s customer orders and partner milestone payments. Revenues, however, beat the Zacks Consensus Estimate of $40 million. It is worth mentioning that the reported revenue figures also beat our estimate of $39.2 million.
Shares of Ligand Pharmaceuticals rose 3.3% in the after-market hours in response to the better-than-expected financial performance. In the past year, shares of Ligand fell 30.3% compared with the industry’s fall of 8.7%.
Image Source: Zacks Investment Research
In early November 2022, Ligand completed the separation of the OmniAb business into a separate independent entity named OmniAb (OABI - Free Report) . Following the separation, Ligand will continue to focus on its Captisol business.
Ligand management has completed the distribution of 100% of its ownership of OmniAb to its shareholders in a tax-free distribution. Shares of OmniAb started trading on the NASDAQ on Nov 2, 2022.
Presently, 85% of OmniAb shares are held by Ligand shareholders. The remaining stake is being held by strategic investor Avista Healthcare.
Quarter in Detail
Royalty revenues were up 25% year over year to $22 million in the fourth quarter. Growth in Royalties was mainly driven by additional sales of drugs developed using its Pelican platform.
Total Captisol sales were down 24% year over year to $26.9 million in the reported quarter. Ligand reported its Captisol sales separately for core assets and COVID-related sales. The core Captisol sales were $3.3 million compared with $7.1 million in the year-ago quarter due to unfavorable timing of customer orders. COVID-related Captisol sales decreased by 16.7% to $23.5 million during the fourth quarter of 2022.
Contract revenues were down 57.4% year over year to $1.5 million in the fourth quarter, owing to the unfavorable timing of partner milestone events.
Cash, cash equivalents and short-term investments amounted to $211.9 million as of Dec 31, 2022 compared with $121.4 million at the end of the previous quarter.
Full-Year 2022 Result
Ligand reported revenues of $196.2 million, down 18.76% year over year, missing the Zacks Consensus Estimate of $209.7 million. Total revenues also missed our estimate of $208.4 million.
The company’s adjusted diluted earnings from continued operations were $4.79 per share, down 23.6% from the year-ago period but, beat both the Zacks Consensus Estimate of $4.34 per share and our estimate of $4.33 per share.
2023 Guidance Raised
Ligand increased its financial guidance for 2023 from the previously issued numbers in December 2022.
The company now expects 2023 royalty revenues in the range of $74 million to $78 million, up from the previously expected range of $72 million to $76 million. Captisol sales and contract revenue expectations remain unchanged at $21 million and $25 million, respectively.
The company also increased its expectation for adjusted diluted EPS to $3.30-$3.45 which was previously expected to be in the range of $3.10-$3.30. The adjusted earnings guidance excludes the impact of gross profit for Captisol sales related to COVID-19.
Key Partnered Pipeline Progress
During the quarter, Ligand’s partner Travere Therapeutics (TVTX - Free Report) announced that the FDA granted accelerated approval to its IgA nephropathy (IgAN) treatment candidate, sparsentan. The drug will be marketed under the brand name Filspari and is the first and only dual endothelin angiotensin receptor antagonist in development for rare kidney diseases.
Travere’s sparsentan is also under review in the European Union for the treatment of IgAN in Europe and a decision by the EMA is expected in the second half of 2023. Travere expects to report top-line results from the confirmatory phase III DUPLEX study of sparsentan for full approval in the second half of 2023, in the United States and Europe.
Ligand’s partner, Novan, announced the submission of a new drug application (NDA) to the FDA seeking marketing approval for berdazimer gel, 10.3% (SB206), to treat molluscum contagiosum. Approval of the NDA is expected in the first quarter of 2024, corresponding to successful acceptance of the filing by the FDA.
In 2022, Ligand’s partner Verona Pharma announced top-line data from the phase III ENHANCE-2 study, which evaluated ensifentrine for chronic obstructive pulmonary disease (COPD). The study achieved both its primary and secondary endpoints evaluating lung function, including a reduction in the risk of COPD exacerbations. Following the study results, Veronas plans to file an NDA with the FDA for inhaled ensifentrine for the maintenance treatment of COPD in the first half of 2023.
In the reported quarter, partner Jazz Pharmaceuticals (JAZZ - Free Report) reported the completion of the marketing authorization application submission to the EMA for both IV and IM administration of Rylaze, an intramuscular injection for the treatment of acute lymphoblastic leukemia and lymphoblastic lymphoma in adult and pediatric patients one month or older. Jazz and Ligand expect potential approval in 2023. Jazz is also currently pursuing potential submission, approval and launch of Rylaze in Japan.
Ligand Pharmaceuticals Incorporated Price, Consensus and EPS Surprise
Image: Bigstock
Ligand's (LGND) Q4 Sales & Earnings Top, View Raised, Stock Up
Ligand Pharmaceuticals Incorporated (LGND - Free Report) reported fourth-quarter 2022 adjusted diluted earnings of $1.36 per share from continuing operations, which beat the Zacks Consensus Estimate and our estimate of $1.23 per share. The company had reported adjusted earnings of $1.47 in the year-ago quarter.
The company additionally reported adjusted earnings of 75 cents per share, after excluding the impact of gross profit for Captisol sales related to COVID-19 which is on par with our estimate.
Total revenues of $50.4 million were down 10.6% from the year-ago quarter. The difference is attributable to the unfavorable timing of Captisol’s customer orders and partner milestone payments. Revenues, however, beat the Zacks Consensus Estimate of $40 million. It is worth mentioning that the reported revenue figures also beat our estimate of $39.2 million.
Shares of Ligand Pharmaceuticals rose 3.3% in the after-market hours in response to the better-than-expected financial performance. In the past year, shares of Ligand fell 30.3% compared with the industry’s fall of 8.7%.
Image Source: Zacks Investment Research
In early November 2022, Ligand completed the separation of the OmniAb business into a separate independent entity named OmniAb (OABI - Free Report) . Following the separation, Ligand will continue to focus on its Captisol business.
Ligand management has completed the distribution of 100% of its ownership of OmniAb to its shareholders in a tax-free distribution. Shares of OmniAb started trading on the NASDAQ on Nov 2, 2022.
Presently, 85% of OmniAb shares are held by Ligand shareholders. The remaining stake is being held by strategic investor Avista Healthcare.
Quarter in Detail
Royalty revenues were up 25% year over year to $22 million in the fourth quarter. Growth in Royalties was mainly driven by additional sales of drugs developed using its Pelican platform.
Total Captisol sales were down 24% year over year to $26.9 million in the reported quarter. Ligand reported its Captisol sales separately for core assets and COVID-related sales. The core Captisol sales were $3.3 million compared with $7.1 million in the year-ago quarter due to unfavorable timing of customer orders. COVID-related Captisol sales decreased by 16.7% to $23.5 million during the fourth quarter of 2022.
Contract revenues were down 57.4% year over year to $1.5 million in the fourth quarter, owing to the unfavorable timing of partner milestone events.
Cash, cash equivalents and short-term investments amounted to $211.9 million as of Dec 31, 2022 compared with $121.4 million at the end of the previous quarter.
Full-Year 2022 Result
Ligand reported revenues of $196.2 million, down 18.76% year over year, missing the Zacks Consensus Estimate of $209.7 million. Total revenues also missed our estimate of $208.4 million.
The company’s adjusted diluted earnings from continued operations were $4.79 per share, down 23.6% from the year-ago period but, beat both the Zacks Consensus Estimate of $4.34 per share and our estimate of $4.33 per share.
2023 Guidance Raised
Ligand increased its financial guidance for 2023 from the previously issued numbers in December 2022.
The company now expects 2023 royalty revenues in the range of $74 million to $78 million, up from the previously expected range of $72 million to $76 million. Captisol sales and contract revenue expectations remain unchanged at $21 million and $25 million, respectively.
The company also increased its expectation for adjusted diluted EPS to $3.30-$3.45 which was previously expected to be in the range of $3.10-$3.30. The adjusted earnings guidance excludes the impact of gross profit for Captisol sales related to COVID-19.
Key Partnered Pipeline Progress
During the quarter, Ligand’s partner Travere Therapeutics (TVTX - Free Report) announced that the FDA granted accelerated approval to its IgA nephropathy (IgAN) treatment candidate, sparsentan. The drug will be marketed under the brand name Filspari and is the first and only dual endothelin angiotensin receptor antagonist in development for rare kidney diseases.
Travere’s sparsentan is also under review in the European Union for the treatment of IgAN in Europe and a decision by the EMA is expected in the second half of 2023. Travere expects to report top-line results from the confirmatory phase III DUPLEX study of sparsentan for full approval in the second half of 2023, in the United States and Europe.
Ligand’s partner, Novan, announced the submission of a new drug application (NDA) to the FDA seeking marketing approval for berdazimer gel, 10.3% (SB206), to treat molluscum contagiosum. Approval of the NDA is expected in the first quarter of 2024, corresponding to successful acceptance of the filing by the FDA.
In 2022, Ligand’s partner Verona Pharma announced top-line data from the phase III ENHANCE-2 study, which evaluated ensifentrine for chronic obstructive pulmonary disease (COPD). The study achieved both its primary and secondary endpoints evaluating lung function, including a reduction in the risk of COPD exacerbations. Following the study results, Veronas plans to file an NDA with the FDA for inhaled ensifentrine for the maintenance treatment of COPD in the first half of 2023.
In the reported quarter, partner Jazz Pharmaceuticals (JAZZ - Free Report) reported the completion of the marketing authorization application submission to the EMA for both IV and IM administration of Rylaze, an intramuscular injection for the treatment of acute lymphoblastic leukemia and lymphoblastic lymphoma in adult and pediatric patients one month or older. Jazz and Ligand expect potential approval in 2023. Jazz is also currently pursuing potential submission, approval and launch of Rylaze in Japan.
Ligand Pharmaceuticals Incorporated Price, Consensus and EPS Surprise
Ligand Pharmaceuticals Incorporated price-consensus-eps-surprise-chart | Ligand Pharmaceuticals Incorporated Quote
Zacks Rank
Ligand Pharmaceuticals currently has a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.