Ligand Completes $739 Million All-Cash Acquisition of XOMA Royalty
The deal adds more than 120 royalty assets to Ligand's portfolio, including seven commercial-stage products, and includes contingent value rights tied to pending litigation.
Ligand Pharmaceuticals (LGND) completed its acquisition of XOMA Royalty Corporation for $39.00 a share in cash, valuing the target's equity at approximately $739 million. The all-cash transaction, announced on April 27, 2026, closed on July 14 after receiving XOMA shareholder approval and clearing regulatory conditions.
XOMA stockholders received the $39.00 cash payment plus one non-transferable Contingent Value Right per share, entitling holders to a portion of 75% of net proceeds that may result from certain pending litigation involving XOMA's dispute with Janssen Biotech over the commercialization of TREMFYA. The cash price represented an approximately 14% premium to XOMA's 30-trading-day volume-weighted average price as of April 24, 2026. Ligand funded the purchase with existing cash on hand and borrowings under its revolving credit facility.
"At Ligand, we are focused on building a diversified portfolio of high-value royalty assets tied to innovative medicines that have the potential to improve patient outcomes around the world," said Todd Davis, CEO of Ligand. "Over the past several years, we have executed a disciplined strategy to expand, diversify and strengthen our royalty portfolio, and the acquisition of XOMA Royalty meaningfully advances that vision".
The acquisition expands Ligand's royalty portfolio to more than 200 assets and adds seven new commercial products, including Roche's VABYSMO, Day One Pharmaceuticals' OJEMDA, and Zevra Therapeutics' MIPLYFFA. XOMA also brings more than 100 development-stage programs, with 14 in late-stage development, highlighted by Takeda's mezagitamab and several assets from Takeda's externalized portfolio. The combined portfolio spans ophthalmology, oncology, central nervous system disorders, and rare diseases.
XOMA Royalty had operated as a biotechnology royalty aggregator since pivoting from a fully integrated drug developer in 2017, deploying more than $200 million of capital across 17 royalty transactions and nine acquisitions. The company's portfolio more than doubled in the three years through 2025, growing to seven commercial programs and more than 100 earlier-stage assets, generating royalty receipts of roughly $34 million and milestone receipts of about $17 million in 2025.
The transaction was immediately accretive to adjusted earnings per share and raised 2026 adjusted EPS guidance to a range of $8.50 to $9.50 at the time of announcement, with the deal expected to contribute approximately $1.50 a share to adjusted EPS in 2027. Ligand projected incremental royalty revenue of approximately $25 million from XOMA's commercial-stage portfolio in 2026, principally from Vabysmo, Ojemda, and Miplyffa, with anticipated cost synergies substantially offsetting incremental operating expenses. Entities affiliated with BVF Partners, which owned roughly 44% of XOMA's outstanding shares, had entered into a voting agreement supporting the transaction.
Following the closing, XOMA's common stock ceased trading on the Nasdaq exchange. The XOMA board was replaced by Ligand-designated directors, including Mr. Davis, Octavio Espinoza, and Andrew Reardon. Leerink Partners served as lead financial advisor and H.C. Wainwright & Co. as financial advisor to XOMA, with Gibson, Dunn & Crutcher LLP providing legal counsel.