Maksim Labkouski
Ligand Pharmaceuticals (NASDAQ:LGND) has merged its subsidiary Pelican Technology with Primordial Genetics to create a new synthetic biology company called Primrose Bio.
Ligand will own 49.9% of Primrose. It will also retain existing commercial royalties related to the Pelican Expression Technology, including rights to Jazz’s Rylaze, Merck’s Vaxneuvance and V116 vaccines, Alvogen’s Teriparatide and Serum Institute of India’s Pneumosil and MenFive vaccines.
Ligand has also entered into an agreement with Primrose for a portion of the economic rights to two contracts entered into by Primordial Genetics and an interest in potential future revenues generated from PeliCRM197 in exchange for $15M.
Ligand said the spinout deal will help accelerate profitability and give the company multiple new “shots on goal” for royalty streams while lowering its infrastructure costs.
The company also issued updated 2023 financial guidance to reflect the divestiture and Pelican’s business profile. Ligand said it now sees reporting revenue of $124M to $126M, down from its prior estimate of $124M to $128M. Adjusted EPS is now expected to be $5.10 to $5.25, up from its previous estimate of $4.85 to $5.00.
Royalties are now seen at $82M to $84M, up from its prior estimate of $78M to $82M, while contract revenue is now expected to be $17M, down from its earlier forecast of $22M. Sales of Captisol are now expected to be $25M, slightly higher than its prior estimate of $24M, Ligand added.
