Ligand Pharmaceuticals (NASDAQ:LGND) reported what management described as a “defining” and “breakout” year in 2025, driven by growth across its royalty portfolio and what it called a lean operating model. On the company’s fourth-quarter and full-year earnings call, executives highlighted strong royalty revenue expansion, updates across partnered programs, and reiterated 2026 guidance first provided at the company’s Investor Day in December 2025.
2025 results driven by multiple launches and ramping royalties
CEO Todd Davis said full-year adjusted EPS exceeded the company’s original 2025 guidance by more than 30%, attributing the outperformance to strategic changes implemented beginning in 2023, a focused investment strategy, and the depth of Ligand’s royalty portfolio. Management reported full-year royalty revenue growth of 48% and a 42% increase in adjusted EPS.
Espinoza added that core adjusted diluted EPS increased to $8.13 for 2025, up 42%. He noted 2025 benefited from a $25 million ZELSUVMI out-license fee, but said the underlying royalty portfolio still delivered “substantial organic growth” independent of that one-time item.
Fourth-quarter highlights: FILSPARI, Ohtuvayre, and CAPVAXIVE
Fourth-quarter total revenue was $59.7 million, a 39% increase from the year-ago period. Royalty revenue of $50.5 million rose 45% year-over-year and was described as the primary driver of growth. Adjusted net income in the quarter was $42.7 million, or $2.02 per diluted share, compared with $1.27 in the prior-year quarter.
Key product metrics cited on the call included:
- FILSPARI: U.S. net sales were $103 million in Q4, up 108% year-over-year, and $322 million for the full fiscal year. Ligand recorded $32 million of royalties on about $355 million in global FILSPARI sales in 2025, including sales reported by CSL Vifor in Europe.
- Ohtuvayre: Merck reported $178 million in net sales in partial Q4. On a full-quarter basis (accounting for Verona owning the asset for the first seven days of the quarter), sales were “just under” $200 million. Full-year U.S. net sales were $506 million.
- CAPVAXIVE: Merck reported net sales of $279 million in Q4 and $755 million for the full year, which management said is “rapidly approaching blockbuster status.”
- QARZIBA: Recordati reported net sales of EUR 159 million for full-year 2025, up 12%.
On expenses, Espinoza said Q4 R&D expense declined to $3.5 million from $4.4 million a year earlier, while G&A expense was $25 million and “relatively flat” year-over-year. For the full year, R&D expense was $81.2 million versus $21.4 million in the prior year, including $62 million tied to the accounting treatment of Castle Creek and Orchestra investments. Full-year G&A was $92.4 million compared to $78.7 million, driven by stock-based compensation, Pelthos transaction costs, and headcount-related costs tied to scaling business development.
Balance sheet and reiterated 2026 guidance
Ligand ended 2025 with $734 million in cash, cash equivalents, and short-term investments. Espinoza said that, when combined with equity holdings in Pelthos Therapeutics and available credit facility capacity, the company finished the year with “over $1 billion in deployable capital.”
For 2026, management reaffirmed guidance introduced at the December Investor Day, calling out the effect of the prior year’s ZELSUVMI out-license income on year-over-year comparisons. The company expects:
- Adjusted EPS: approximately $8 to $9 per share
- Royalty revenue: $200 million to $225 million
- Captisol revenue: $35 million to $40 million
- Contract revenue: $10 million to $20 million
- Total revenue: $245 million to $285 million
Royalty growth in 2026 is expected to be driven primarily by FILSPARI, Ohtuvayre, CAPVAXIVE, and ZELSUVMI, which management said remain early in their commercial life cycles.
Portfolio updates: QTORIN rapamycin, lasofoxifene, and TZIELD
Vice President of Portfolio Strategy and Investments Lauren Hay said Ligand has launched a more systematic portfolio management process aimed at increasing partner engagement and proactively identifying investment opportunities. She said the company is actively engaged on “five to 10” opportunities and has another “10” it plans to pursue over the next couple of quarters, with the potential for “another announcement or two” by year-end.
Management highlighted Palvella Therapeutics’ positive top-line Phase III SELVA trial results for QTORIN rapamycin in microcystic lymphatic malformations (MLM). Hay said Palvella reported highly statistically significant results on the primary endpoint and multiple secondary endpoints, with 95% of participants rated as improved and 86% rated as much improved or very much improved. She added that there were no drug-related serious adverse events and that 98% of participants who completed the trial continued into the extension period. Palvella plans to submit an NDA in the second half of 2026 and is accelerating U.S. launch readiness, according to Hay.
Ligand also discussed lasofoxifene, a Phase III program for ER-positive, HER2-negative metastatic breast cancer in patients with ESR1 mutation. Hay said the asset’s license was assigned from Sermonix to LeonaBio (formerly Athira Pharma) alongside a $90 million PIPE and potential additional financing. Ligand participated in the PIPE. Top-line data from the pivotal ELANE-3 trial is expected in mid-2027 and the trial is “more than 50% enrolled,” Hay said. She also noted that Henlius holds exclusive rights in Asia and certain Middle East countries and is in Phase III development in China.
On TZIELD, Davis said the current Stage 2 Type 1 diabetes indication requires screening of pre-symptomatic patients, which is commercially challenging, but said the proposed Stage 3 indication would target newly diagnosed symptomatic patients and could be “much larger.” Hay previously noted that Sanofi expects a regulatory decision in the first half of 2026 under the Commissioner’s National Priority Voucher Pilot Program for the Stage 3 filing, and is also pursuing a lowering of age eligibility in the Stage 2 indication with an April 29 PDUFA date.
Other call themes: FILSPARI FSGS timing, business development, and royalty financing demand
In Q&A, management said it assumed a “relatively modest,” risk-adjusted contribution from FILSPARI in FSGS within its 2026 outlook. Davis said the company had disclosed a $4 million assumption for 2026 at Investor Day, and that moving the PDUFA out by a quarter would have minimal impact.
Davis also said Ligand is seeing growing demand for royalty capital, citing a doubling of the royalty funding market over the last five years, and argued royalty financing has become a more mainstream, non-dilutive tool that can complement equity financing. Looking forward, he said Ligand expects to accelerate business development in 2026 with an expanded team and deeper pipeline, while maintaining a focus on high clinical value assets where Phase III studies may cost $30 million to $80 million.
About Ligand Pharmaceuticals (NASDAQ:LGND)
Ligand Pharmaceuticals, Inc is a biopharmaceutical company that acquires, develops and out-licenses proprietary technologies designed to help pharmaceutical and biotechnology companies discover and develop novel medicines. Operating primarily through its research services and royalty-generating businesses, Ligand focuses on building a diversified portfolio of technology platforms and partnering with industry leaders to advance therapeutic candidates across multiple disease areas.
The company’s product offerings center around several core platforms.
