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Ligand (LGND) Up 4% on Raised '23 EPS, Beats on Q2 Earnings
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Shares of Ligand Pharmaceuticals Incorporated (LGND - Free Report) rose 4.4% in after-market hours on Aug 8, likely on account of the company’s raised 2023 earnings per share (EPS) guidance when it announced its second-quarter 2023 results.
In the year so far, shares of Ligand have inched up 0.5% against the industry’s 12.5% fall.
Q2 Earnings Beat, Sales Miss Estimates
Ligand reported adjusted diluted earnings of $1.42 per share in second-quarter 2023 from continuing operations, beating the Zacks Consensus Estimate of 76 cents. The company reported adjusted earnings of 43 cents in the year-ago quarter.
Total revenues of $26.4 million were down 47% from the year-ago quarter’s levels. The downside was due to the absence of COVID-19-related Captisol sales during the quarter. Revenues missed the Zacks Consensus Estimate of $28 million.
Quarter in Detail
Royalty revenues were up 15% year over year to $20.4 million in the second quarter. The upside was mainly driven by increased royalties from Amgen’s Kyprolis, Jazz Pharmaceuticals’ (JAZZ - Free Report) Rylaze and Merck’s (MRK - Free Report) Vaxneuvance.
Total Captisol sales were down 82% year over year to $5.2 million in the reported quarter. Ligand reports its Captisol sales separately for core assets and COVID-related sales. Core Captisol sales rose 57% to $5.2 million due to the favorable timing of customer orders. During the quarter, the company did not record any Captisol sales related to COVID-19.
Contract revenues were down 74% year over year to $0.7 million in the second quarter, owing to the unfavorable timing of partner milestone events.
Cash, cash equivalents and short-term investments amounted to $219.0 million as of Jun 30, 2023, compared with $282.7 million as of Mar 31, 2023.
2023 Guidance
Ligand revised its guidance for 2023. Royalty revenues expectations remained unchanged in the $78-$82 million range. The company now expects Captisol sales to generate $24 million (previously: $21 million), while contract revenue is expected to be $22 million (previously: $25 million).
The company also increased its expectation for adjusted diluted EPS to $4.85-$5.00, which was expected in the range of $4.60-$4.75. This increased EPS guidance is due to gains from Viking Therapeutics (VKTX - Free Report) stock sales. During the second quarter, Ligand also sold 3.2 million shares of VKTX stock, resulting in $43 million of net proceeds.
This guidance excludes Captisol sales related to COVID-19 and its impact on gross profit. Management will update investors as and when orders for COVID-19-related products are received.
Key Partnered Pipeline Progress
Last month, Ligand’s partner Merck announced positive topline results from two late-stage studies evaluating V116, an investigational 21-valent pneumococcal conjugate vaccine, in vaccine-naïve and previously vaccinated individuals. Both studies, which Merck conducted, achieved their key immunogenicity and safety endpoints.
In July, Ligand’s partner Jazz Pharmaceuticals received a positive recommendation from the European Medicines Agency's (EMA) Committee for Medicinal Products for Human Use (CHMP) on the marketing authorization application (MAA) for the lymphoma drug Rylaze. JAZZ, which filed the MAA, seeks approval for Rylaze to treat acute lymphoblastic leukemia and lymphoblastic lymphoma in adult and pediatric patients one month and older. Rylaze is already approved for similar indications in the United States.
This May, Ligand’s partner Viking Therapeutics announced encouraging top-line results from the phase IIb VOYAGE study evaluating VK-2809 in patients with biopsy-confirmed non-alcoholic steatohepatitis (NASH). The Viking Therapeutics conducted study achieved its primary endpoint, demonstrating statistically significant reductions in liver fat following 12 weeks of treatment with VK2809 compared to those receiving a placebo.
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Ligand (LGND) Up 4% on Raised '23 EPS, Beats on Q2 Earnings
Shares of Ligand Pharmaceuticals Incorporated (LGND - Free Report) rose 4.4% in after-market hours on Aug 8, likely on account of the company’s raised 2023 earnings per share (EPS) guidance when it announced its second-quarter 2023 results.
In the year so far, shares of Ligand have inched up 0.5% against the industry’s 12.5% fall.
Q2 Earnings Beat, Sales Miss Estimates
Ligand reported adjusted diluted earnings of $1.42 per share in second-quarter 2023 from continuing operations, beating the Zacks Consensus Estimate of 76 cents. The company reported adjusted earnings of 43 cents in the year-ago quarter.
Total revenues of $26.4 million were down 47% from the year-ago quarter’s levels. The downside was due to the absence of COVID-19-related Captisol sales during the quarter. Revenues missed the Zacks Consensus Estimate of $28 million.
Quarter in Detail
Royalty revenues were up 15% year over year to $20.4 million in the second quarter. The upside was mainly driven by increased royalties from Amgen’s Kyprolis, Jazz Pharmaceuticals’ (JAZZ - Free Report) Rylaze and Merck’s (MRK - Free Report) Vaxneuvance.
Total Captisol sales were down 82% year over year to $5.2 million in the reported quarter. Ligand reports its Captisol sales separately for core assets and COVID-related sales. Core Captisol sales rose 57% to $5.2 million due to the favorable timing of customer orders. During the quarter, the company did not record any Captisol sales related to COVID-19.
Contract revenues were down 74% year over year to $0.7 million in the second quarter, owing to the unfavorable timing of partner milestone events.
Cash, cash equivalents and short-term investments amounted to $219.0 million as of Jun 30, 2023, compared with $282.7 million as of Mar 31, 2023.
2023 Guidance
Ligand revised its guidance for 2023. Royalty revenues expectations remained unchanged in the $78-$82 million range. The company now expects Captisol sales to generate $24 million (previously: $21 million), while contract revenue is expected to be $22 million (previously: $25 million).
The company also increased its expectation for adjusted diluted EPS to $4.85-$5.00, which was expected in the range of $4.60-$4.75. This increased EPS guidance is due to gains from Viking Therapeutics (VKTX - Free Report) stock sales. During the second quarter, Ligand also sold 3.2 million shares of VKTX stock, resulting in $43 million of net proceeds.
This guidance excludes Captisol sales related to COVID-19 and its impact on gross profit. Management will update investors as and when orders for COVID-19-related products are received.
Key Partnered Pipeline Progress
Last month, Ligand’s partner Merck announced positive topline results from two late-stage studies evaluating V116, an investigational 21-valent pneumococcal conjugate vaccine, in vaccine-naïve and previously vaccinated individuals. Both studies, which Merck conducted, achieved their key immunogenicity and safety endpoints.
In July, Ligand’s partner Jazz Pharmaceuticals received a positive recommendation from the European Medicines Agency's (EMA) Committee for Medicinal Products for Human Use (CHMP) on the marketing authorization application (MAA) for the lymphoma drug Rylaze. JAZZ, which filed the MAA, seeks approval for Rylaze to treat acute lymphoblastic leukemia and lymphoblastic lymphoma in adult and pediatric patients one month and older. Rylaze is already approved for similar indications in the United States.
This May, Ligand’s partner Viking Therapeutics announced encouraging top-line results from the phase IIb VOYAGE study evaluating VK-2809 in patients with biopsy-confirmed non-alcoholic steatohepatitis (NASH). The Viking Therapeutics conducted study achieved its primary endpoint, demonstrating statistically significant reductions in liver fat following 12 weeks of treatment with VK2809 compared to those receiving a placebo.