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Stockholders' Equity
 12 Months Ended
Dec. 31, 2023
Equity [Abstract]  
Stockholders' Equity Stockholders’ Equity
Share-based Compensation Expense
The following table summarizes share-based compensation expense from continuing operations (in thousands):
December 31,
202320222021
Share-based compensation expense as a component of:
Research and development expenses$6,248 $10,970 $9,341 
General and administrative expenses19,495 39,911 19,985 
$25,743 $50,881 $29,326 
Conversion and Modification of Equity Awards Outstanding at Separation Date
In connection with the OmniAb Separation on November 1, 2022, under the provisions of the existing plans, we adjusted our outstanding equity awards in accordance with the Merger Agreement to preserve the intrinsic value of the awards immediately before and after the Distribution. Upon the Distribution, employees holding stock options, restricted stock units and performance restricted stock units denominated in pre-Distribution Ligand stock received a number of otherwise-similar awards either in post-Distribution Ligand stock or in a combination of post-Distribution Ligand stock and OmniAb stock based on conversion ratios outlined for each group of employees in the Merger Agreement that we entered into in connection with the Distribution. The equity awards that were granted prior to March 2, 2022 were converted under the shareholder method, wherein employees holding outstanding equity awards received equity awards in both Ligand and OmniAb. For equity awards granted after March 2, 2022, for Ligand employees, the number of awards that were outstanding at the Separation were proportionately adjusted into post-Distribution Ligand stock to maintain the aggregate intrinsic value of the awards at the date of the Separation; for OmniAb employees, the number of awards that were outstanding at the Separation were proportionately adjusted into post-Distribution OmniAb stock to maintain the aggregate intrinsic value of the awards at the date of the Separation. The conversion ratio was determined based on the relative values of Ligand common stock in the “regular way” and “ex-distribution” markets during the five-trading day period prior to the closing of the business combination.
These modified awards otherwise retained substantially the same terms and conditions, including term and vesting provisions. Additionally, we will not incur any future compensation cost related to equity awards held by OmniAb employees and directors. We will incur future compensation cost related to OmniAb equity awards held by our employees.
Stock Plans
In June 2022, our stockholders approved the amendment and restatement of the Ligand Pharmaceuticals Incorporated 2002 Stock Incentive Plan (the “2002 Plan”). The amended and restated 2002 Plan, which is referred to herein as the “Restated Plan” was amended to increase the shares available for issuance by 1.0 million.
On July 29, 2022, our board of directors (the “Board”) approved the Ligand Pharmaceuticals Incorporated 2022 Employment Inducement Plan (the “2022 Inducement Plan”). The terms of the 2022 Inducement Plan are substantially similar to the terms of the Restated Plan with the exception that incentive stock options may not be issued under the 2022 Inducement Plan and awards under the 2022 Inducement Plan may only be issued to eligible recipients under the applicable Nasdaq Listing Rules. The 2022 Inducement Plan was adopted by the Board without stockholder approval pursuant to Rule 5635(c)(4) of the Nasdaq Listing Rules. The Board has initially reserved 300,000 shares of the Company’s common stock for issuance pursuant to awards granted under the 2022 Inducement Plan.
As of December 31, 2023, there were 1.0 million shares available for future option grants or direct issuance under the Restated Plan and the 2022 Inducement Plan.
Following is a summary of our stock option plan activity and related information:
 
Shares
Weighted
Average
Exercise
Price
Weighted
Average
Remaining
Contractual
Term in
Years
Aggregate
Intrinsic
Value
(In thousands)
Balance at January 1, 20212,561,822 $85.59 6.09$59,033 
Granted393,589 $159.12 
Exercised(619,731)$54.28 
Forfeited(136,082)$110.83 
Balance at December 31, 20212,199,598 $106.00 6.34$113,302 
Exercisable at December 31, 20211,391,952 $98.16 5.12$80,849 
Options vested and expected to vest as of December 31, 20212,199,598 $106.00 6.34$113,302 
Granted863,245 $91.34 
Exercised(34,941)$38.56 
Forfeited(40,069)$78.46 
Balance at October 31, 20222,987,833 $102.92 0$14,835 
Exercisable at October 31, 20221,769,629 $102.38 0$13,722 
Options vested and expected to vest as of October 31, 2022, before Separation and Regrant2,987,833 $102.92 0$14,835 
Cancellation due to Separation, Before Regrant(2,987,833)
Balance at November 1, 2022, Before Regrant— 
Granted (1)
3,584,760 $60.10 
Exercised(50,449)$30.24 
Forfeited(542,838)$56.20 
Balance at December 31, 20222,991,473 $61.31 6.07$30,477 
Exercisable at December 31, 20221,559,662 $60.83 4.51$17,951 
Options vested and expected to vest as of December 31, 20222,991,473 $61.31 6.07$30,477 
Granted537,432 $72.69 
Exercised(489,076)$45.83 
Forfeited(399,371)$66.61 
Balance at December 31, 20232,640,458 $65.70 5.63$8,784 
Exercisable at December 31, 20231,784,209 $64.90 4.26$7,300 
Options vested and expected to vest as of December 31, 20232,640,458 $65.70 5.63$8,784 
(1) Options granted primarily relate to the modifications in connection with the Separation which resulted in new stock option grants at the modification date fair value.
The weighted-average grant-date fair value of all stock options granted during 2023, 2022 and 2021 was $36.65, $28.90, and $80.08 per share, respectively. The total intrinsic value of all options exercised during 2023, 2022 and 2021 was approximately $12.0 million, $4.6 million, and $77.3 million, respectively.
Cash received from options exercised, net of fees paid, in 2023, 2022 and 2021 was $22.2 million, $2.6 million and $33.0 million, respectively.
Following is a further breakdown of the options outstanding as of December 31, 2023:
Range of exercise prices
Options
outstanding
Weighted
average
remaining  life
in years
Weighted average
exercise price
Options
exercisable
Weighted average
exercise price
$32.78-$49.99
301,757 3.30$42.37 290,880 $42.35 
$50.36-$52.30
99,385 7.50$52.13 42,782 $52.12 
$52.84-$52.84
357,661 5.11$52.84 221,056 $52.84 
$54.81-$58.28
270,544 5.06$55.96 244,342 $55.93 
$58.49-$66.54
283,007 5.91$62.27 160,772 $61.26 
$66.70-$68.74
450,234 4.81$67.87 380,713 $68.03 
$69.39-$75.09
484,258 8.53$72.82 109,410 $72.43 
$78.56-$99.80
209,945 4.16$89.95 192,904 $90.52 
$103.42-$103.42
170,701 6.07$103.42 128,384 $103.42 
$114.15-$114.15
12,966 4.16$114.15 12,966 $114.15 
2,640,458 5.63$65.70 1,784,209 $64.90 

The assumptions used for the specified reporting periods and the resulting estimates of weighted-average grant date fair value per share of options granted:
 Year Ended December 31,
 
2023
2022
2021
Risk-free interest rate
3.7%-4.6%
1.4%-4.3%
0.4%-1.2%
Expected volatility
45%-54%
49%-55%
47%-63%
Expected term
4.7 to 5.3 years
2.0 to 6.5 years
4.7 to 6.3 years

As of December 31, 2023, there was $26.2 million of total unrecognized compensation cost related to non-vested stock options under the 2002 Plan. That cost is expected to be recognized over a weighted average period of 2.5 years.
As of December 31, 2023, there was $1.1 million of total unrecognized compensation cost related to non-vested OmniAb stock options received upon aforementioned spin-off conversion. That cost is expected to be recognized over a weighted average period of 0.9 years.

Restricted Stock Activity
The following is a summary of our restricted stock activity and related information: 
Shares
Weighted-Average
Grant Date Fair
Value
Outstanding at December 31, 2021264,143 $138.21 
Granted260,577 $89.99 
Vested(138,867)$120.57 
Forfeited(19,383)$58.45 
Outstanding at October 31, 2022, before Separation and Regrant366,470 $114.83 
Forfeited due to Separation, Before Regrant(366,470)
Balance at November 1, 2022, Before Regrant— 
Granted424,473 $75.61 
Vested(73,385)$75.17 
Forfeited(2,635)$89.05 
Outstanding at December 31, 2022348,453 $75.60 
Granted203,752 $83.39 
Vested(181,246)$74.62 
Forfeited(20,054)$65.35 
Outstanding at December 31, 2023350,905 $81.22 
As of December 31, 2023, unrecognized compensation cost related to non-vested stock awards under the 2002 Plan amounted to $15.2 million. That cost is expected to be recognized over a weighted average period of 1.6 years.
As of December 31, 2023, there was $0.1 million of total unrecognized compensation cost related to non-vested OmniAb stock awards received upon aforementioned spin-off conversion. That cost is expected to be recognized over a weighted average period of 0.1 years.
Employee Stock Purchase Plan
As of December 31, 2023, 30,801 shares of our common stock are available for future issuance under the Amended Employee Stock Purchase Plan, or ESPP. The ESPP permits eligible employees to purchase up to 1,250 shares of Ligand common stock per calendar year at a discount through payroll deductions. The price at which stock is purchased under the ESPP is equal to 85% of the fair market value of the common stock on the first of a six month offering period or purchase date, whichever is lower. There were 5,080, 8,479 and 8,448 shares issued under the ESPP in 2023, 2022 and 2021, respectively.
Share Repurchases
In April 2023, our Board of Directors has approved a stock repurchase program authorizing, but not requiring, the repurchase of up to $50.0 million of our common stock from time to time through April 2026. We expect to acquire shares, if at all, primarily through open-market transactions in accordance with all applicable requirements of Rule 10b-18 under the Securities Exchange Act of 1934, as amended. The timing and amount of repurchase transactions will be determined by management based on our evaluation of market conditions, share price, legal requirements and other factors. During the years ended December 31, 2023, 2022 and 2021, we did not repurchase any common stock, respectively.
At-the Market Equity Offering Program
On September 30, 2022, we filed a registration statement on Form S-3 (the “Shelf Registration Statement”), which became automatically effective upon filing, covering the offering of common stock, preferred stock, debt securities, warrants and units.
On September 30, 2022, we also entered into an At-The-Market Equity Offering Sales Agreement (the “Sales Agreement”) with Stifel, Nicolaus & Company, Incorporated (the “Agent”), under which we may, from time to time, sell shares of our common stock having an aggregate offering price of up to $100.0 million in “at the market” offerings through the Agent (the “ATM Offering”). The Shelf Registration Statement included a prospectus covering the offering, issuance and sale of up to $100.0 million of our common stock from time to time through the ATM Offering. The shares to be sold under the Sales Agreement may be issued and sold pursuant to the Shelf Registration Statement. To date, we have not issued any shares of common stock in the ATM Offering.