Ligand Pharmaceuticals (LGND) 8-K Business Development and Strategic Planning

1

John L. Higgins

President and Chief Executive Officer

Syed Kazmi, Ph.D.

Business Development and Strategic Planning

Exhibit 99.1

2

Safe Harbor Statement

•

The following presentation contains forward-looking statements regarding the proposed

acquisition of Neurogen by Ligand, including projections regarding expectations for

potential research and development payments, savings in operational costs, cash burn

rates, timing of achieving positive cash flow, and potential revenue and profits of a

combined company.

•

The forward looking statements made in the presentation are subject to several risk

factors, including, but not limited to the reliance on collaborative partners for milestone

and royalty payments, regulatory hurdles facing product candidates, uncertain product

development costs, disputes regarding ownership of intellectual property, the commercial

success of approved products, the failure of Neurogen’s stockholders to approve the

merger, Ligand’s or Neurogen’s inability to satisfy the conditions of the merger, or that

the merger is otherwise delayed or ultimately not consummated, and a failure of the

combined businesses to be integrated successfully.  Additional risks may apply to

forward looking statements made in this presentation.

•

The risk factors facing Ligand and Neurogen are explained in greater detail in the

Company’s and Neurogen’s filings with the SEC, including the most recently filed annual

reports on Form 10-K and quarterly reports on Form 10-Q, as well as other public filings.

3

Additional Information and Where to Find It

•

Ligand intends to file with the SEC a Registration Statement on Form S-4, which will include a proxy statement of

Neurogen and other relevant materials in connection with the proposed transaction. The proxy statement will be mailed

to the stockholders of Neurogen. Investors and security holders of Neurogen are urged to read the proxy statement and

the other relevant materials when they become available because they will contain important information about Ligand,

Neurogen and the proposed transaction. The proxy statement and other relevant materials (when they become

available), and any other documents filed by Ligand or Neurogen with the SEC, may be obtained free of charge at the

SEC's web site at www.sec.gov. In addition, investors and security holders may obtain free copies of the documents filed

with the SEC by Ligand by going to Ligand’s Investor Relations page on its corporate website at www.ligand.com.

Investors and security holders may obtain free copies of the documents filed with the SEC by Neurogen by going to

Neurogen’s Investor Relations page on its corporate website at www.neurogen.com. Investors and security holders of

Neurogen are urged to read the proxy statement and the other relevant materials when they become available before

making any voting or investment decision with respect to the proposed transaction.

•

Ligand and its respective directors and executive officers may be deemed to be participants in the solicitation of proxies

from the stockholders of Neurogen in favor of the proposed transaction. Information concerning Ligand’s directors and

executive officers is set forth in Ligand’s proxy statement for its 2008 annual meeting of shareholders, which was filed

with the SEC on April 29, 2008, and annual report on Form 10-K filed with the SEC on March 5, 2008.

•

Neurogen

and

its

respective

directors

and

executive

officers

may

be

deemed

to

be

participants

in

the

solicitation

of

proxies from the stockholders of Neurogen in favor of the proposed transaction. Information about Neurogen’s executive

officers and directors and their ownership of Neurogen common stock is set forth Neurogen’s amended annual report on

Form

10-K,

which

was

filed

with

the

SEC

on

April

30,

2009.

Investors

and

security

holders

may

obtain

more

detailed

information regarding the direct and indirect interests of Neurogen and its respective executive officers and directors in

the acquisition by reading the proxy statement regarding the merger, which will be filed with the SEC.

4

Fundamentals of a Strong Biotech Company

•

Strong balance sheet

•

Spending discipline

•

Strong discovery capabilities and track record

•

Robust pipeline of partnerable

assets

•

Revenue diversity

Operating structure that has the potential to

generate substantial cash flows and profitability

5

Ligand Company Overview

•

Company with great assets

-

Two royalty streams, plus two more royalty-bearing products recently approved

-

Ten pharma

deals with over 21 development programs and over $600 million of

potential milestones

-

Prolific drug discovery engine has produced multitudes of drug candidates

•

Highly successful drug discovery capabilities

-

Focus on early-stage drug discovery and development

-

Partner pipeline assets at earliest value inflection point

•

Leadership focused on shareholders and market credibility

-

Cost-efficient R&D business with tight spending discipline

-

Clear communication and transparency with investors

-

Clarity on how to drive a business forward in this market environment

•

Commitment to driving shareholder value and to transparency on the business

with goal to drive strong cash flow and earnings

6

Ligand –

Recent events

•

Signed agreement to acquire Neurogen, public company with drug

screening assets, cash, pipeline and a drug partnership

•

PROMACTA

®

Phase I/II trial initiated with MDS

•

CONBRIZA™

approved in Europe for the treatment of osteoporosis

•

FABLYN®

Approved in Europe for the treatment of osteoporosis

•

Entered

license

agreement

with

ParinGenix

for

Phase

II

COPD

drug

•

Completed

lease

buyout,

substantially

reducing

contractual

lease

costs

going forward

•

Initiated Phase I SARM trial

•

Wyeth JAK 3 data presented at ACS

7

Pending Neurogen Acquisition

Stock-for-Stock Acquisition

Consideration

-

Net proceeds from sale of real  

estate

-

Net proceeds from sale of Aplindore

-

$3 million for Phase III trial initiation

for Merck VR1 program

-

$4 million if license H3 program

CVRs

$11 million in Ligand Common Stock,

plus potential for Four Contingent Value

Rights (CVR)

Transaction Value

4Q 2009

Anticipated Closing Date

Ligand to acquire Neurogen (NRGN)

Deal

Actual timing of the transaction will depend on a number of factors, some of which are beyond either company’s control.

8

Opportunity with Neurogen Acquisition

•

Acquire fully funded research partnership

Merck VR1 program

•

Access pipeline assets

Numerous opportunities including oral EPO and H3 antagonist

•

Leverage drug discovery capabilities of both companies

Accelerated Intelligent Drug Design platform

•

Gain estimated $7 million in net cash

•

Acquire substantial NOLs

before limitations

9

Partnership Highlights

10

Significant Value in Royalty Partnerships

•

Numerous deals with ten pharmaceutical companies

•

More than 21 different programs being pursued including the largest untapped

markets

Muscle wasting, COPD, thrombocytopenia, pain, asthma, Alzheimer’s

•

More than $600 million in potential R&D and milestone payments from existing

deals

Ligand has one of the strongest, most diverse royalty partnership rosters

in the small cap biotech universe 

11

Pharmaceutical Partnerships

12

Combined Product Pipeline

13

•

PROMACTA approved for treatment of

thrombocytopenia in patients with chronic

immune ITP in November 2008.

•

Two Phase III Hepatitis trials ongoing

•

Phase III trial in Chronic Liver Disease

ongoing

•

Phase I/II MDS trial initiated Spring 2009

•

Phase I Sarcoma trial ongoing

•

Submitted MAA for the long-term treatment

of ITP in December 2008.

•

LGD-4665 and other Ligand TPO molecules

licensed to GSK in December 2008

&

Collaboration Highlights

14

Thrombocytopenia -

Causes of Disease

•

Decreased production of platelets

Myelodysplastic

syndrome

Hepatitis C

Cancer in the bone marrow (leukemia)

Aplastic

anemia

•

Increased destruction of platelets

Autoimmune, such as ITP

Sequestration in the spleen

•

Drug-induced

Myelosuppression

by chemotherapy regimens

Anti-virals

in Hep

C therapies

Thrombocytopenia is a condition in which there is an abnormally low level of

platelets in the blood. 

Regardless of the underlying cause, thrombocytopenia leads to decreased platelet counts,

which puts patients at greater risk for bleeding and serious adverse events.

15

Medical Significance of Thrombocytopenia (US)

(Estimated markets)

Potential

Treatable

Patients

ITP

~60,000

Hepatitis C

~120,000

Chronic Liver Disease                                           

~400,000

Myelodysplastic

syndrome

~20,000

Leukemia / lymphoma

~50,000

Chemotherapy induced thrombocytopenia

~140,000

Intensive care unit –

acquired

~500,000

Bone marrow transplants

~50,000

Lupus

~100,000

Cirrhosis

~113,000

HIV/other

~600,000

~ 2 million platelet transfusions per year

16

ParinGenix

License

•

In June 2009, Ligand granted exclusive license rights to ParinGenix

for three issued U.S. patents relating to certain desulfated heparin

compounds

•

ParinGenix

lead compound, PGX-100, is an intravenous formulation

of

2-O,

3-O

desulfated

heparin

which

is

in

a

Phase

IIb

trial

for

the

treatment of acute COPD exacerbations (~700,000 patients require

hospitalization every year)

•

License terms

$350,000 upfront payment

3% royalty on net sales in the US

•

The transaction adds another potential lucrative royalty stream to

Ligand's already promising list of partnered, fully funded, royalty-

bearing programs

17

SERM Collaborations

•

Bazedoxifene

Monotherapy:   

CONBRIZA approved in Europe in April 2009

Viviant pending approval in the U.S.

•

Bazedoxifene

in Combination with Premarin

CE (APRELA):

Phase III data published in Fertility and Sterility

NDA planned for in 2010

•

Lasofoxifene

(FABLYN) for osteoporosis

treatment

•

Approved in Europe in March 2009 for the

treatment of osteoporosis

•

NDA pending approval in U.S.; FDA issued

Complete Response Letter in January 2009

18

Collaboration Highlights

&

•

Collaboration began in November 1997

•

Partnership resulted in lead and back-up

p38 kinase

inhibitor compounds

•

Anti-inflammatory therapeutics

Ongoing Clinical Trials:

•

Phase II in rheumatoid arthritis

•

Phase II in psoriasis

•

Phase II in atherosclerosis

The Opportunity:

•

Large, established target markets

•

If successfully developed, Ligand estimates

product could be on market in 2014  

p38 Kinase

Inhibitors

19

&

•

Collaboration began in October 1998

•

Collaboration produced multiple drug          

candidates

Completed Clinical Trials:

•

Phase II in COPD

•

Phase II in asthma

•

Phase II in psoriasis

The Opportunity:

•

Large, established target markets

•

If successfully developed, Ligand estimates

product could be on market in 2014

Chemokine

Receptor

CXCR2

Program

Collaboration Highlights

20

Collaboration Highlights

&

Other Research Program

Ongoing Clinical Trials:

•

Enzyme inhibitor in Phase II for oncology

•

Candidate for inflammatory diseases in Phase I

•

Candidate for respiratory diseases in Phase I

Recent Event:

•

BACE inhibitor for Alzheimer’s in development,

resulting in a milestone payment of $1 million

21

Collaboration Highlights

&

•

Collaboration began March 2006

•

Identify and advance molecules in chosen

therapeutic programs to development  

stage

Milestone and Royalty:

•

7 compounds identified to date

•

Success-based milestone payments and

up to double-digit royalties upon

commercialization

•

Seventh lead compound identified resulting in

a milestone payment of $500,000

Broad Discovery Program

22

Collaboration Highlights

&

•

Collaboration began in December 2006

$3 million per year in research funding

•

Alliance based on development of JAK3

kinase

inhibitors for systemic administration

for immunological and inflammatory

diseases

•

Success-based milestone payments and

up to double-digit royalties upon

commercialization

JAK-3 Kinase

23

SARM Program Overview

24

Selective Androgen Receptor Modulator Program

•

LGD-4033 is a selective androgen receptor modulator (SARM),

designed to provide the benefits of androgen receptor stimulation on

skeletal muscle and bone without the side effects of the currently

marketed androgens

•

LGD-4033 has demonstrated increased skeletal muscle mass and

bone mineral density while sparing the prostate in males and

masculinizing

effects in females in preclinical models

•

A Phase I study was initiated in summer 2009 to evaluate the safety,

tolerability and pharmacokinetic profile of LGD-4033 (expected

completion 1H2010)

•

Target

Indications:

Sarcopenia

&

frailty,

cachexia,

osteoporosis,

hypogonadism, sexual dysfunction

Market Need:

Convenient, prostate-sparing androgen receptor modulator with

activity in bone, muscle and CNS

25

Research Engine

26

Ligand Research Platform

•

Technology

-

Gene reporter assays for nuclear receptors and JAK/STAT-coupled receptors

-

Ultra high-throughput screening platform combined with the world’s largest

proprietary

compound

collection

(5

+

million

compounds)

•

Highly flexible screening platform: cell-free and cell-based assays; functional and

binding assays

•

Consistently high rate of success across all classes of targets

•

Preclinical Development

-

Extensive track record both independently and with partners

-

Total of 48 clinical candidates discovered and 24 INDs

filed

•

Solid track record for publications

-

Quality journals: Science, Cell, Endocrinology, Journal of Medicinal Chemistry

-

First reports for many important discoveries:

•

Hematopoietic receptor-targeted small molecule drugs

•

Non-steroidal selective androgen receptor modulators

•

Non-steroidal selective progesterone receptor modulators

•

RXR-selective retinoid

27

Ligand Development & Partnerships

•

Clinical strategy to run Phase I-II programs through proof-of-concept

•

13 NDAs

and MAAs

submitted for Ligand discovered drugs

•

5 approved products from Ligand technology: Targretin, Panretin,

Promacta, Fablyn, Conbriza

•

Established track record for partnering with over 40 collaborations

with more than 30 different companies

•

Experience in multiple therapeutic areas

•

More than 21 different programs being pursued including the largest

untapped markets

Muscle wasting, COPD, thrombocytopenia, pain, asthma, osteoporosis,

Alzheimer’s

28

Pro Forma Financial Forecast

* Assumes Neurogen Acquisition closes in Q4 2009

•

Projected to have approximately $50 million in cash at year-end 2009

•

Given our current outlook on the combined businesses, 2010 pro forma operating

business projected to be approximately cash-flow neutral with expenses in line with

revenue

•

Potential for additional revenue and cash infusion from new license agreements

•

More than $500 million in potential Net Operating Loss carry-forwards before

limitations

Robustly capitalized company that

has sufficient cash

to make it to profitability without additional financings

29

Potential Near-Term Milestone and Events

•

Completion of Schering Plough CXCR2 Trial in COPD

•

Compound nomination from JAK-3 program by Wyeth for pre-clinical

development

•

Compound nomination by GSK from drug discovery collaboration

•

Nomination of Oral EPO drug candidate

•

VIVIANT FDA Action

•

Potential for over $10 million in milestone payments from existing

collaborations

Milestone or Event

•

SARM Phase I trial completion

•

PROMACTA EU NDA Action

•

PROMACTA data at ASH