Ligand Pharmaceuticals Incorporated : To Acquire XOMA Royalty

Published: 2026-04-27 07:26:09 ET LGND

Published on 04/27/2026 at 07:26 am EDT

A P R I L 27 , 20 2 6

Ligand Acquisition of XOMA Royalty Corporation

will bemailed to XOMA Royalty's stockholders in connection with the proposedacquisition. This presentation is nota substitute for the proxy statement or any other documentthat maybe filsd by XOMA Royalty with the SEC. BEFORE MAKING ANY VOTING DECISION, INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE PRELIMINARY AND DEFINITIVE PROXY STATEMENTS AND ANY OTHER DOCUMENTS TO BE FILED WITH THE SEC IN CONNECTION WITH THE PROPOSED ACQUISITION OR INCORPORATED BY REFERENCE IN THE PROXY STATEMENT WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT

INFORMATION ABOUT THE PROPOSED ACQUISITION. Anyvote in respect ofresolutions to beproposed at the XOMA Royalty'sstockholder meeting to approve the proposedacquisition or other responses in relation to the proposed acquisition should be made only on the basis of the information contained in the Company's proxy statement. Investors and security holders may obtain free copies of these documents (when they are available)andotherrelateddocumentsfilsdwith theSEC at theSEC'swebsiteat https://www.sec.gov,or at investors.XOMA.com.

NoOffsr or Solicitation

This presentation is for information purposes only and is notintended to and does not constitute, or formpart of, an offsr, invitation or the solicitation of an offsr or invitation to purchase, otherwise acquire, subscribe for, sell orotherwise dispose of any securities, or the solicitation ofany vote or approval in any jurisdiction, pursuant to the proposed acquisition or otherwise, nor shall there be any sale, issuance or transfer of securities in any jurisdictionincontraventionofapplicablelaw.

Participantsin the Solicitation

XOMARoyultyunditsdirsctors,sxscutivsofficsrsundothsrmsmbsrsof munugsmsntundsmploysss,undsrSECrulss,muybs dssmedto be"participants"in thesolicitationof proxiesfrom stockholdersof XOMARoyultyin fuvorofthspropossducquisition.InformutionuboutthsXOMA Royulty'sdirsctorsundsxscutivsofficsrsis set forthin XOMARoyalty'sproxystatementforits2026annualmeetingsof stockholdsrs,whichwus filsd withths SECon Murch30,2026undis uvuilublshere. Additionalinformationconcerningthe interestsof XOMARoyalty'sparticipantsinthesolicitation,whichmay, in somecases, bsdiffsrsntthun thossof XOMARoyulty'sstockholdsrsgsnsrully,willbssst forthinXOMA Royulty'sproxystutsmsntrslutingto the proposedacquisitionwhenit becomesavailable.Thesedocumentsare availablefreeofchargeat the SEC'sweb site at www.sec.govandat investors.XOMA.com.

Safe Harbor Statement h Disclaimers (Continued)

Transaction Overview h Strategic Rationale

Todd Davis

Purchase Price

$39 per share in cash + one non-tradeable contingent value right (CVR) related to certain pending litigation at XOMA Royalty 14% Premium to XOMA's 30 trading day VWAP

Ligand to fund the acquisition through available cash on hand and liquidity under existing revolving credit facility

Structure Details

One-step merger structure. All shares of XOMA will be acquired by Ligand

XOMA common shareholders receive one CVR per share, representing the right to receive a portion of 75% of any net proceeds related to XOMA's dispute with Janssen Biotech regarding Tremfya

Portfolio

Ligand adds XOMA's 3 key programs to its commercial royalty portfolio: Vabysmo, Ojemda and Miplyffu

Gains > 100 partnered development stage programs

Business Model

Complementary business model with a footprint in earlier development stage programs

Timing

Expected to close in the third quarter of 2026, subject to obtaining XOMA's shareholder approval and required regulatory approvals

Entitiss uffiliutsd with BVF Purtnsrs, which own upproximutsly 44% of ths outstunding shurss of XOMA Royulty common stock

(on an as converted basis) have entered into a voting agreement to support the transaction

Transaction Overview

Ligund unnouncss ucquisition of XOMA Royulty Corporution, significuntly sxpunding Ligund's royulty

portfolio and accelerating near and long-term growth

2025 Financial Results Total Revenue

+$52M

Total Cash Receipts

+$50M

Net Income

~$32M

1981 - 2017

Founded and operated as a fully integrated biotechnology company for

over 35 years

2017

Executed a strategic pivot to become a biotech royalty aggregator

2017 - Today

XOMA is a royalty aggregator and has assembled a high-quality portfolio of over 120 partnered

progrums. XOMA hus rsuchsd un inflsction point, gsnsruting significunt portfolio rscsipts

Since 2017, XOMA has deployed >$200M of capital, completed 17 royalty transactions and closed 9 acquisitions to create a well divsrsifisd portfolio

XOMA Background

XOMA has more than doubled the size of its royalty portfolio in the last three years, adding immediately accretive assets and a well-divsrsifisd pipslins ucross dsvslopmsnt stugss und therapeutic categories

2025

2023

PORTFOLIO

Commercial Programs

Phase 3 / Registrational

Phase 2 / Earlier

100+

FINANCIAL

Royalty Receipts

~$9M

~$34M

Milestone Receipts

~$7M

~$17M

XOMA Portfolio h Financial Growth

Acquisition Strategic Rationale

Immediately Accretive

Transaction is immediately accretive, expected to add ~$0.50 and ~$1.50 to Ligand's projected 2026 and 2027 Adjusted EPS1, respectively.

Divsrsificution of

Portfolio

7 new royalty generating assets and +100 additional development stage assets

Significunt IP und

Royalty Rights

Long dated royalties, some into 2040+, increasing predictability and durability of royalty receipts

Strategic Synergies

Improved access to capital and BD opportunities; significunt cost synsrgiss through the elimination of duplicative costs

with

Ligand's acquisition of XOMA doubles the size of Ligand's royalty portfolio,

offsring significunt upsids opportunitiss und un immsdiutsly uccrstivs trunsuction

Ligand + XOMA

FINANCIAL

Strong finunciul psrformuncs

Immediately accretive acquisition expected to add ~$0.50 of adjusted EPS in 20261 and ~$1.50 in 20272

Financial synergies through elimination of duplicative public company costs

BUSINESS DEVELOPMENT

Highly productive, rigorous process

Acquisition strengthens our position as a Biopharma Royalty Aggregator

Crsutss opsruting und finunciul synsrgiss

Early development stage programs create longer-term opportunities to drive growth

ROYALTY PORTFOLIO

Drives growth in 2026 and beyond

7 commercial royalties, including 3 near-term growth drivers : Vabysmo, Ojemda and

Miplyffu

Adds >100 development stage programs to our portfolio

Creates robust opportunity to leverage our portfolio management process

STRATEGIC DIFFERENTIATION

Financials, advantage, team

Expected increase to our long-term royalty receipts CAGR

Proven structuring capabilities is expected to drive outsized returns

Disciplined capital allocation; Low operating expense model

Ths finunciul outlook, sxpsctutions und othsr forwurd-looking stutsmsnts providsd by Ligund for 2026 und bsyond rsflsct Ligund's judgement based on the information available at the time of this release. Please see the "Cautionary Note Regarding Forward-looking Statements" section in this release for factors that may impact Ligand's ability to meet expectations. Core adjusted EPS represents a non-GAAP measure. In reliance upon Item 10(e)(1)(i)(B) of Regulation S-K, reconciliations of forward-looking core adjusted earnings per diluted share for 2027 is not provided because of the unreasonable sffort ussociutsd with providing such rsconciliutions dus to ths vuriubility in ths occurrsncs und ths umounts of csrtuin componsnts thsrsof. For ths sums rsusons, ws urs unubls to uddrsss ths significuncs of ths unuvuilubls informution, which could be material to future results.

Financials

Tavo Espinoza

Ligund's ucquisition of XOMA is immsdiutsly uccrstivs in 2026. Rsvissd finunciul guiduncs ussumss

transaction closes in Q3 2026

Adjusted Core EPS1

$8.50- 9.50

(Previously $8.00 - 9.00)

Total Revenue

$270 - 310M

(Previously $245 - $285M)

Non-Royalty Revenue

Captisol: $35 - 40M Contract: $10 - 20M

(no change)

Royalty Revenue

$225 - 250M

Previously ($200 - $225M) Adding: Ojemda, Vabysmo and Miplyffu

See reconciliation of forward-looking non-GAAP revenue and adjusted core EPS to their most directly comparable GAAP measure in the uppsndix. Ths finunciul outlook, sxpsctutions und othsr forwurd-looking stutsmsnts providsd by Ligund for 2026 und bsyond rsflsct Ligund's judgmsnt bussd on ths informution uvuilubls ut ths tims of this release. Please see the "Cautionary Note Regarding Forward-looking Stutsmsnts" ssction in this rslsuss for fuctors thut muy impuct Ligund's ubility to msst sxpsctutions.

2026 Revised Financial Guidance

2026 Initial Guidance

XOMA

Revised 2026 Guidance

Total Revenue

$245 − 285M

$25M

$270 − 310M

COGS

$13 − 15M

Core Cash OpEx

$45M

$5M

$50M

Cash Operating

Profit*

$187 − 225M

$20M

$207 − 245M

Other Income

$28 − 32M

($6M)

$22 − 26M

Adjusted Net Income*

$170 − 200M

$11M

$181 − 210M

Share Count

21.3 − 22.2M

21.3 − 22.1M

Adjusted Core

EPS*

$8.00 − 9.00

$0.50

$8.50 − 9.50

Total Revenue expected to increase by ~$25M

Core Cash OpEx rsflscts unticiputsd incremental operating cost while realizing significunt cost synsrgiss from combining two standalone companies

Cush Opsruting Profit grows 10% at the midpoint, rsflscting opsruting lsvsrugs und continued royalty growth

Other Income reduced because of capital deployment and lower full year interest income

Adjusted Core EPS up ~6% vs initial guidance at the midpoint

*Sss rsconciliution of forwurd-looking non-GAAP core adjusted earnings to the most directly comparable GAAP measure in the appendix. Ths finunciul outlook, sxpsctutions und othsr forwurd-looking stutsmsnts providsd by Ligund for 2026 und bsyond rsflsct Ligund's judgmsnt bussd on ths informution uvuilubls ut ths tims of this release. Please see the "Cautionary Note Regarding Forward-looking Stutsmsnts" ssction in this rslsuss for fuctors thut muy impuct Ligund's ubility to msst sxpsctutions.

2026 Revised Financial Guidance

Assuming transaction closes in Q3'26

Positive developments which are expected to drive an increase to the long- term outlook include:

Ligand Expected Royalty Receipts1

Acquisition of XOMA is immediately accretive and is expected to drive significunt growth

The FDA approved Filspari to be the first FDA upprovsd trsutmsnt in FSGS in April 2026, creating a significunt commsrciul opportunity to expand beyond IgAN. Ligand earns a 9% royalty on net sales of Filspari

Palvella announced positive Phase 3 data in MLM for its QTORIN rapamycin progrum und pluns to fils an NDA by the end of the year. Ligand will earn a tiered 8-9.8% royalty if approved

Current 5-Year Target From 2025 Investor Day

Potential Incremental Growth To Be Shared At Analyst Day

2024 2025 2026 2027 2028 2029 2030

23% CAGR

1. Sell-side consensus sales estimates used to arrive at royalty revenue from commercial programs.

5-Year Outlook To Be Updated In December

Portfolio

Lauren Hay

From Ligand From XOMA

Commercial

DARE to PLAY

Sildєn5fil Crє5m

Phase 3

Lasofoxifene

QTORIN Rapamycin

AVIM Therapy

Ersodetug

Undisclosed

Seralutinib

Rilvegostomig

LeonaBio

Palvella

Orchestra

D- Fi

Rezolute

Anti-TL1A

Gossamer Bio/Chiesi

AstraZeneca

Soticlestat

Ovid

Bot/Bal

Agenus

Virtue SAB

Orchestra

Castle Creek

Osavampator

Takeda/Takeda Partner

Mezagitamab

Takeda

OHB- 607

Ficlatuzumab

AVEO/LG Chem

REC- 4881

Ovaprene

Dare Bioscience

Phase 2

VK- 2809

Viking

Note: List of programs shown is not exhaustive

VK- 0214

Viking

Oak Hill Bio/Chiesi

Cetrelimab

Johnson & Johnson

Recursion

Volixibat

Takeda1

1. Volixibat is in development by Mirum Pharmaceuticals under a license with Takeda

Pro Forma Royalty Portfolio - Key Programs

Marketer(s)

Program

Indication(s)

Royalty Rate

Wet AMD, DME, RVO

0.5%

r/rpLGG

Mid-single digit

Niemann-Pick Disease Type C

Mid-single digit

Hemophilia B

Mid-single digit

Bacterial Vaginosis

Low to high-single digit

Acute Pain

37-75% on DoW sales

DARE to PLAY1

Sildsnufil Crsum

Female Sexual Arousal Disorder

Low-single digit

Commercial availability through a 503B outsourcing facility.

AMD = Age-related Macular Degeneration, DME = Diabetic Macular Edema, RVO = Retinal Vein Occlusion, r/rpLGG = Relapsed or Progressive Pediatric Low-Grade Glioma, DoW = Department of War

Key XOMA Commercial Partnered Programs

7 Commercial Royalties, 3 Near-Term Growth Drivers

Developer(s)

Program

Indication(s)

Phase

Royalty Rate

Frontline Pediatric Low-Grade Glioma

Phase 3

Mid-single digit

Mezagitamab

IgA Nephropathy Immune Thrombocytopenia

Phase 3

Low to mid-single digit

Osavampator1

Major Depressive Disorder

Phase 3

Low to mid-single digit

Volixibat2

Primary Sclerosing Cholangitis Primary Biliary Cholangitis

Phase 2b (Registrational)

Low to mid-single digit

Rilvegostomig

Oncology (Multiple Tumor Types)

Phase 3

Undisclosed

OHB-607

Prevention of Bronchopulmonary Dysplasia

Phase 2b

Low to mid-single digit

Undisclosed

Anti-TL1A

Ulcerative Colitis Crohn's Disease

Phase 3

Undisclosed

Ojemda

Osavampator is being developed by Takeda in Japan and by a Takeda partner outside Japan

Volixibat is in development by Mirum Pharmaceuticals under license from Takeda

Key XOMA Pipeline Partnered Programs

Product Value Proposition

First upprovsd bispscific untibody inhibiting both VEGF-A and Ang-2, reducing

vusculur lsukugs, nsovusculurizution, und inflummution mors thun VEGF-only agents

Dslivsring vulus to putisnts uffsctsd by wst ugs-related macular degeneration, diabetic macular edema, and macular edema following retinal vein occlusion

One of Roche's top growth drivers in 2025, as the third best selling product in their entire pharmaceutical portfolio

Analyst Consensus Peak Sales: $7.5B+