Updates 2018 Full Year and Second Quarter Financial Guidance
Ligand Pharmaceuticals Incorporated (NASDAQ: LGND) announces it has received $47 million as a result of signing an amendment relating to its OmniAb platform agreement with WuXi Biologics (“WuXi Bio”, SEHK: 2269.HK). This amendment provides WuXi Bio more efficiency in expanding its OmniAb antibody discovery services.
Under the previous license agreement, OmniAb antibodies discovered and sub-licensed by WuXi Bio generated potential pre-defined contract payments to Ligand and potential royalties on global product sales. Under the amended agreement, Ligand will continue to be eligible to earn royalties at the same rate and terms as the previous agreement and the pre-defined contract payments have been eliminated. With this new business relationship, WuXi Bio believes it will be able to increase the number of OmniAb antibodies it discovers for its clients in China and around the world.
“This expanded agreement with WuXi Bio demonstrates the continued success of our OmniAb platform, and illustrates the focus and ongoing efforts by OmniAb partners to advance their OmniAb pipelines. There are now eight OmniAb-derived antibodies at clinical-stage, and a number of other programs are advancing as well,” said John Higgins, Chief Executive Officer of Ligand. “This transaction also underscores the significant value a key partner sees in the OmniAb platform, and we are pleased to offer WuXi Bio this added flexibility as they discover antibodies with our platform.”
2018 Full Year and Second Quarter Financial Guidance
Ligand updates previous guidance and now expects 2018 revenue to be approximately $226 million, including royalties of approximately $116 million, license fees and milestones of approximately $87 million and material sales of approximately $23 million, with the potential for up to an additional $10 million in license fees and milestones.
Ligand is also updating its guidance for cash expenses for the year. Due to the substantial increase in expected revenue for 2018, Ligand plans to accelerate certain R&D spending on selected internal projects which will result in revised 2018 cash expenses of $36 million to $38 million. Ligand notes that with revenue of $226 million and the revised cash expense guidance, adjusted earnings per diluted share would be approximately $6.15.
This compares with previous guidance for 2018 revenue to be approximately $184 million, including royalties of approximately $116 million, license fees and milestones of approximately $45 million and material sales of approximately $23 million, with the potential for up to an additional $20 million in license fees and milestones. Previous cash expense guidance was $33 million to $35 million.
Ligand anticipates total revenue for the second quarter of 2018 to be approximately $82 million to $84 million and adjusted earnings per diluted share to be $2.32 to $2.37.
“This expanded agreement with WuXi Bio demonstrates the continued success of our OmniAb platform, and illustrates the focus and ongoing efforts by OmniAb partners to advance their OmniAb pipelines. There are now eight OmniAb-derived antibodies at clinical-stage, and a number of other programs are advancing as well,” said John Higgins, Chief Executive Officer of Ligand. “This transaction also underscores the significant value a key partner sees in the OmniAb platform, and we are pleased to offer WuXi Bio this added flexibility as they discover antibodies with our platform.”
2018 Full Year and Second Quarter Financial Guidance
Ligand updates previous guidance and now expects 2018 revenue to be approximately $226 million, including royalties of approximately $116 million, license fees and milestones of approximately $87 million and material sales of approximately $23 million, with the potential for up to an additional $10 million in license fees and milestones.
Ligand is also updating its guidance for cash expenses for the year. Due to the substantial increase in expected revenue for 2018, Ligand plans to accelerate certain R&D spending on selected internal projects which will result in revised 2018 cash expenses of $36 million to $38 million. Ligand notes that with revenue of $226 million and the revised cash expense guidance, adjusted earnings per diluted share would be approximately $6.15.
This compares with previous guidance for 2018 revenue to be approximately $184 million, including royalties of approximately $116 million, license fees and milestones of approximately $45 million and material sales of approximately $23 million, with the potential for up to an additional $20 million in license fees and milestones. Previous cash expense guidance was $33 million to $35 million.
Ligand anticipates total revenue for the second quarter of 2018 to be approximately $82 million to $84 million and adjusted earnings per diluted share to be $2.32 to $2.37.
