Ligand Pharmaceuticals will spin off its Johnson & Johnson-partnered antibody platform business OmniAb and capitalize the company with $70 million.
The separation is slated for the first half of this year, Ligand said Thursday after market close.
Since November, the California biopharma has been considering multiple paths for OmniAb, including the potential to become a standalone public company via an initial public offering. Now, Ligand is moving forward with a direct spinoff of 100% of OmniAb's equity, setting up two independent public companies.
The board has yet to give final approval, and Ligand will continue evaluating other options, the company said as part of its full-year 2021 results.
"Our plan now is for Ligand to directly fund the OmniAb business at the time of the spin-off. This strategy is intended to best serve our science and partners, and to maximize value for our shareholders,” said John Higgins, CEO of Ligand, in a statement. This strategy results in the "soonest possible" separation, he added.
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The OmniAb platform experienced its "most prolific year ever" in 2021, Higgins said. He noted that nine antibodies derived from OmniAb recently entered the clinic, and some have racked up regulatory nods. CStone Pharmaceuticals recently received a green light from China's regulators for Celjemy, which is an OmniAb-derived anti-PD-L1 monoclonal antibody for non-small cell lung cancer.
J&J's Janssen unit also submitted its OmniAb-derived bispecific antibody, teclistamab, for multiple myeloma to the FDA in December.
The OmniAb platform uses transgenic animals including rats, chickens and mice that are genetically modified to generate antibodies with human sequences for therapeutics. The platform is key to Ligand's partnering model and is used by more than 55 partners across 250 programs, including 25 that were active- or commercial-stage as of Dec. 31, 2021.
Ligand has licensed its OmniAb platform to recent partners like Paragon, LTZ and Seismic.