Ligand Collaborator Merck Receives FDA Approval for CAPVAXIVE™ (Pneumococcal 21-valent Conjugate Vaccine) for Adults

Rhea-AI Summary

Ligand Pharmaceuticals announced that its collaborator Merck has received FDA approval for CAPVAXIVE™, a 21-valent pneumococcal conjugate vaccine for adults. This marks the sixth FDA-approved product utilizing Ligand's Pfenex Expression Technology® platform. Merck's approval triggers a $2 million milestone payment to Ligand, which is also entitled to royalties on global net sales. CAPVAXIVE, previously known as V116, is intended to prevent invasive pneumococcal disease and pneumonia. The PeliCRM197® carrier protein, enhancing antigen immunogenicity, is a key component of this vaccine. Ligand continues to collect commercial royalties on products developed with its technology, including CAPVAXIVE.

Positive

• FDA approval of CAPVAXIVE™.
• $2 million milestone payment received by Ligand.
• Entitlement to royalty on worldwide net sales of CAPVAXIVE.
• CAPVAXIVE is the sixth FDA-approved product using Ligand's technology.
• PeliCRM197® carrier protein enhances vaccine efficacy.
• Ligand maintains commercial royalties on six products developed with Pfenex Expression Technology.

Negative

• Accelerated approval may imply further post-marketing requirements or conditional status.
• Potential competition from other pneumococcal vaccines in the market.

Financial Analyst

The FDA approval of CAPVAXIVE™ is a significant milestone for Ligand Pharmaceuticals, entitling them to a $2 million milestone payment and ongoing royalties on worldwide net sales. This approval will positively impact Ligand's revenue streams, adding another product to their portfolio that leverages the Pfenex Expression Technology® platform. This platform has already proven its value with other FDA-approved products, indicating a reliable and scalable business model.

Financially, this development offers both short-term and long-term benefits. The immediate $2 million payment bolsters short-term liquidity, while ongoing royalties provide a steady revenue stream. Given that CAPVAXIVE targets the adult population for pneumococcal disease, which is a substantial market, the long-term revenue prospects are robust. Investors should consider the potential for increased earnings stability and diversified revenue sources, which can enhance the company's financial health and growth prospects.

In the context of Ligand's recent spin-out of Primrose Bio, the retained commercial royalties reinforce the strategic decision to focus on high-value, royalty-generating assets. This can make Ligand a more attractive proposition for investors looking for a company with strong, diversified revenue streams and a proven track record of leveraging innovative technologies.

Medical Research Analyst

From a medical perspective, the approval of CAPVAXIVE™ addresses a critical need in the healthcare sector. Pneumococcal pneumonia and invasive pneumococcal disease are serious conditions, especially in the adult population. The use of the PeliCRM197® carrier protein enhances antigen immunogenicity, potentially leading to better vaccine efficacy compared to existing alternatives.

The accelerated approval for the pneumococcal pneumonia indication underscores the urgency and importance of this vaccine in the current medical landscape. This is particularly relevant considering the aging global population, which is at higher risk for such infections. The vaccine's 21-valent composition means it can protect against 21 different strains of pneumococcal bacteria, offering broad coverage and likely improving public health outcomes.

For investors, understanding the medical necessity and expected uptake of CAPVAXIVE can provide insights into the potential market size and adoption rates. The medical community's support for this vaccine could translate into strong sales performance, validating the strategic importance of Ligand's technology platform.

Market Research Analyst

The market potential for CAPVAXIVE™ is substantial, given its FDA approval for the adult population. Pneumococcal diseases are a significant health concern and the vaccine's broad protection makes it a valuable addition to the existing market. The adult pneumococcal vaccine market is competitive, but CAPVAXIVE's innovative approach using the Pfenex Expression Technology® and the PeliCRM197® carrier protein could provide a competitive edge.

Furthermore, Ligand's strategy of leveraging their technology platform across multiple products enhances their market position. With six FDA-approved products utilizing the Pfenex platform, Ligand demonstrates a strong pipeline and a proven ability to bring products to market. This diversification reduces dependency on a single product and spreads risk across multiple revenue streams.

Investors should consider the implications of this diversified portfolio and the potential for CAPVAXIVE to capture significant market share. The company's ability to secure FDA approval for multiple products also suggests a strong regulatory strategy and effective R&D capabilities, which are critical for long-term success in the pharmaceutical industry.

CAPVAXIVE is the sixth FDA-approved product to utilize the Pfenex Expression Technology® platform

Ligand is entitled to a royalty on worldwide net sales of CAPVAXIVE

JUPITER, Fla.--(BUSINESS WIRE)-- Ligand Pharmaceuticals Incorporated (Nasdaq: LGND) today announced that its collaborator Merck, known as MSD outside the United States and Canada, has received approval from the U.S. Food and Drug Administration (FDA) for CAPVAXIVE™, previously known as V116, a 21-valent pneumococcal conjugate vaccine for the prevention of invasive pneumococcal disease and pneumococcal pneumonia in the adult population. The indication for pneumococcal pneumonia is under accelerated approval. The FDA approval of CAPVAXIVE triggers a $2 million milestone payment to Ligand and the company is entitled to a royalty on worldwide net sales.

“We are excited to see our longstanding collaborator Merck receive regulatory approval for CAPVAXIVE,” said Todd Davis, CEO of Ligand. “We believe this asset will be an important contributor to our portfolio, which includes more than 25 commercial products including two marketed by Merck.”

CAPVAXIVE utilizes the PeliCRM197® carrier protein which helps enhance antigen immunogenicity in conjugate vaccines. PeliCRM197 is produced using the Pfenex Expression Technology® platform which Ligand initially acquired in 2020 and ultimately spun out to Primrose Bio in September 2023. As part of the Primrose Bio transaction, Ligand retained the existing commercial royalties related to the Pfenex Expression Technology including CAPVAXIVE.

Ligand will now collect commercial royalties on six products developed with the Pfenex Expression Technology, including Merck’s CAPVAXIVE and VAXNEUVANCE^®, Jazz Pharmaceuticals’ RYLAZE^®, Alvogen’s Teriparatide Injection, and Serum Institute of India’s Pneumosil^® and MenFive^® vaccines.

About Ligand Pharmaceuticals

Ligand is a biopharmaceutical company enabling scientific advancement through supporting the clinical development of high-value medicines. Ligand does this by providing financing, licensing our technologies or both. Its business model seeks to generate value for stockholders by creating a diversified portfolio of biopharmaceutical product revenue streams that are supported by an efficient and low corporate cost structure. Ligand’s goal is to offer investors an opportunity to participate in the promise of the biotech industry in a profitable and diversified manner. Its business model focuses on funding programs in mid- to late-stage drug development in return for economic rights, purchasing royalty rights in development stage or commercial biopharmaceutical products and licensing its technology to help partners discover and develop medicines. Ligand partners with other pharmaceutical companies to leverage what they do best (late-stage development, regulatory management and commercialization) in order to generate its revenue. Ligand’s Captisol® platform technology is a chemically modified cyclodextrin with a structure designed to optimize the solubility and stability of drugs. Ligand has established multiple alliances, licenses and other business relationships with the world’s leading biopharmaceutical companies including Amgen, Merck, Pfizer, Jazz, Takeda, Gilead Sciences and Baxter International. For more information, please visit www.ligand.com. Follow Ligand on X @Ligand_LGND.

We use our investor relations website and X as a means of disclosing material non-public information and for complying with our disclosure obligations under Regulation FD. Investors should monitor our website and our X account, in addition to following our press releases, SEC filings, public conference calls and webcasts.

Forward-Looking Statements

This news release contains forward-looking statements by Ligand that involve risks and uncertainties and reflect Ligand's judgment as of the date of this release. Words such as “plans,” “believes,” “expects,” “anticipates,” and “will,” and similar expressions, are intended to identify forward-looking statements. These forward-looking statements include: the timing and amount of milestone payments Ligand expects; the potential royalties to be paid on sales of CAPVAXIVE by Merck; the submission of any CAPVAXIVE supplemental regulatory licensure application with the FDA; and the intellectual property protections with respect to Primrose Bio’s Pfenex Expression Technology® platform. Actual events or results may differ from Ligand’s or its partner’s expectations due to risks and uncertainties inherent in Ligand’s and its partner’s business, including, without limitation: Merck may not be able to successfully commercialize CAPVAXIVE which will depend on a number of factors including coverage and reimbursement levels from governmental authorities and health insurers as well as market acceptance by healthcare providers; the market size for CAPVAXIVE may be smaller than estimated; Ligand is dependent on Merck for the commercialization of CAPVAXIVE; and other risks described in Ligand’s prior press releases and filings with the Securities and Exchange Commission available at www.sec.gov. Ligand disclaims any intent or obligation to update these forward-looking statements beyond the date of this release. This caution is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240618130919/en/

For Ligand:

Investors:

Michael Jeong

investors@ligand.com

(561) 214-4232

LifeSci Advisors

Bob Yedid

bob@lifesciadvisors.com

(516) 428-8577

Media:

Kellie Walsh

media@ligand.com

(914) 315-6072

Source: Ligand Pharmaceuticals Incorporated

FAQ

What is the significance of Merck receiving FDA approval for CAPVAXIVE™?

Merck's FDA approval for CAPVAXIVE™ marks the sixth FDA-approved product utilizing Ligand's Pfenex Expression Technology®, leading to a $2 million milestone payment and royalties on worldwide sales for Ligand.

What is CAPVAXIVE™?

CAPVAXIVE™ is a 21-valent pneumococcal conjugate vaccine approved for preventing invasive pneumococcal disease and pneumonia in adults.

What financial benefit does Ligand receive from CAPVAXIVE™ approval?

Ligand receives a $2 million milestone payment and is entitled to royalties on worldwide net sales of CAPVAXIVE™.

What is the Pfenex Expression Technology®?

Pfenex Expression Technology® is a platform used for producing proteins, which has contributed to the development of six FDA-approved products, including CAPVAXIVE™.

How does the PeliCRM197® carrier protein contribute to CAPVAXIVE™?

The PeliCRM197® carrier protein enhances antigen immunogenicity, improving vaccine efficacy.