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LGND Nasdaq· Ligand Pharmaceuticals, Inc
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LGND Nasdaq· Ligand Pharmaceuticals, Inc
Earnings report Q3 2023

Ligand Reports Decrease in Revenue in Q3 2023

Segments of revenue

In the third quarter of 2023, Ligand reported total revenue of $32.9 million, representing a significant decrease of $26.4 million or 44% compared to the same period in 2022. This decline was primarily driven by the absence of Captisol sales related to COVID-19, which amounted to $32.4 million in Q3 2022.

Strengths

Despite the decrease in revenue, Ligand continues to generate revenue through its royalties and contract revenue. Royalties increased by $4.6 million or 24% to reach $23.9 million in Q3 2023 compared to $19.3 million in Q3 2022. This growth can be attributed to the successful licensing and development of biopharmaceutical assets. Additionally, Ligand's Captisol - Core segment saw a significant increase in revenue, with sales amounting to $8.6 million, reflecting a growth of $5 million or 140% compared to the same period last year.

Challenges

The main challenge faced by Ligand in the latest quarter was the absence of revenue from Captisol - COVID, which resulted in a decrease of $32.4 million. This decline was expected as the company had previously reported significant revenue from this segment due to the COVID-19 pandemic. However, as the situation evolves and the demand for COVID-related products decreases, Ligand needs to find alternative sources of revenue to compensate for this loss.

Noteworthy

It is worth noting that Ligand recently underwent a spin-off of its OmniAb antibody discovery business, which has allowed the company to focus on developing or acquiring technologies that aid pharmaceutical companies in the discovery and development of medicines. This strategic move may have an impact on Ligand's future financial performance and revenue generation.

Summary

Ligand reported a decrease in revenue in the third quarter of 2023, primarily due to the absence of revenue from Captisol sales related to COVID-19. However, the company demonstrated strength in its royalty and contract revenue streams, with royalties increasing by 24% and Captisol - Core segment revenue growing by 140%. Ligand's ability to adapt to the changing market conditions and find alternative sources of revenue will be crucial in overcoming the challenges posed by the decline in Captisol - COVID revenue.

Source documents

Form 10-Q  filed on Nov 09, 2023
102 pages scanned

Reference data

Company financials Q3 revenue 32.9M
Analyst estimates Q3 EPS beat by 64.46%
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