Friday Follow-up: Personal Buy

The personal buy order I mentioned on Friday triggered this morning

By Travis Johnson, Stock Gumshoe, June 24, 2013

Just a quick note to let you know that the order I was talking about in the last Friday File, picking up an initial position in Ligand Pharmaceuticals (LGND), my most recent “Idea of the Month” stock, did in fact go through. So I now have a smallish position (about 2% of my stock portfolio) now in LGND at an average cost of very close to the $35 that I mentioned as the “I’d rather not pay more than this” price. I’ll be looking to add to my position at some point if I continue to like the company’s execution, but hopefully that will be on a dip.

Ligand did release some news since I last wrote, though it’s not earth-shattering — they said their diabetes compound LGD-6972 showed promising results in preclinical studies (animal models), so they’re going to apply for FDA approval to start clinical trials (that’s an IND application) sometime later this year. If this follows their pattern, they’ll do the relatively inexpensive early studies themselves and then, if it shows promise, partner it with someone else who will shoulder the cost of advanced trials in exchange for future royalties and milesetone payments, but we could easily be years from this compound mattering to LGND. Still, good news is good news and the stock did continue to rise today in a weak market, so clearly there’s still an appetite for this “born again” risk-averse drug developer and royalty stock.

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