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Pharma

Ligand Pharmaceuticals is buying rival biotech royalty firm XOMA for $739 million

The all-cash deal adds more than 120 assets to Ligand's portfolio and is expected to close in the third quarter of 2026

2 min read·Updated April 27, 2026
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Ligand Pharmaceuticals agreed to acquire Xoma Royalty Corporation for $39 per share in an all-cash deal valued at about $739 million, the two companies announced April 27.

The royalty aggregator model, which both companies use, involves taking stakes in drugs that are still in clinical development and earning royalty payments on sales if those treatments ultimately win approval. The deal would expand Ligand's royalty portfolio to more than 200 assets and add seven commercial products, the company said.

Xoma stockholders will also receive one non-transferable Contingent Value Right per share, entitling them to a portion of 75% of any net proceeds from ongoing litigation involving Xoma's dispute with Janssen Biotech over the commercialization of TREMFYA. The cash offer represents a premium of about 14% to Xoma's 30-day volume weighted average price as of April 24, 2026, the last trading day before the announcement. Ligand stock was up about 3.9% in premarket trading on the day of the announcement, according to The Wall Street Journal.

Ligand will fund the acquisition using existing cash and borrowings under its existing credit facility, the company said. The transaction has been unanimously approved by both boards of directors. Entities affiliated with BVF Partners, which hold about 21% of Xoma's outstanding common stock, have entered into a voting agreement supporting the deal.

Among the assets Ligand gains through the acquisition are royalty interests in Roche's eye treatment Vabysmo, Day One Pharmaceuticals' brain-cancer drug Ojemda, and Zevra Therapeutics' Miplyffa, as well as 14 programs in late-stage development.

"This acquisition will add seven marketed products and almost double our portfolio of Phase 2 and 3 assets," Ligand CEO Todd Davis said in a statement. Davis added that the deal would allow Ligand to grow in areas such as ophthalmology, oncology, CNS, and rare diseases.

Xoma CEO Owen Hughes said in a statement that the deal "delivers to our stockholders both the intrinsic value of XOMA's portfolio today and the optionality associated with our ongoing litigation with Janssen Biotech via the CVR."

For full-year 2026, Ligand updated its revenue outlook to $270 million to $310 million, compared with its earlier forecast of $245 million to $285 million. The company also increased its 2026 adjusted earnings per diluted share guidance to $8.50 to $9.50, from $8.00 to $9.00. Ligand said it expects the transaction to add $1.50 per share to adjusted earnings per share in 2027.

The deal is expected to close in the third quarter of 2026, subject to approval by Xoma stockholders and receipt of certain regulatory approvals.

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