Erika Luib – IR John Higgins – President and CEO John Sharp – VP, Finance and CFO

David Webber – Broadpoint Capital Derek Jellinek – Susquehanna Financial Group Chris James – Rodman & Renshaw

Good afternoon. My name is Judy, and I will be your conference operator today. At this time, I would like to welcome everyone to the Ligand First Quarter Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. (Operator instructions) Thank you. I will now turn the call over to Erika Luib of Investor Relations. Please go ahead, ma'am.

Thank you, Julie. Welcome to Ligand's first quarter financial results and business update conference call. Speaking today for Ligand are John Higgins, President and CEO and John Sharp, Vice President of Finance and CFO. Just a reminder to everyone that today's call will contain forward-looking statements within the meaning of federal securities laws. These may include but are not limited to statements regarding intent, belief or current expectations of the Company, its internal and partnered programs and its management. These statements involve risk and uncertainties and actual events and results may differ materially from the projections described in the press release and its conference call. Additional information concerning risk factors and other matters concerning Ligand can be found on Ligand's public periodic filings with the Securities and Exchange Commission, which are available at www.SEC.gov. The information in this conference call related to projections or other forward-looking statements represents the Company’s best judgment as of today, May 1, 2008. Ligand undertakes no obligation to revise or update any statements to reflect events or circumstances after the date of this conference call. At this time, I will turn the conference call over to John Higgins. John?

Erika, thank you. Welcome, everybody to our conference call. I want to just start off by saying we are off to a great start here in 2008. The business is running well, and we have several major news events coming up. Ligand is a Company that will derive value from our partnered programs that have the potential to generate substantial royalty revenue as well as from our internal research and development programs. We continue to run an efficient business with a strong balance sheet, and we are pleased with how this year has started. I want to first talk about our key partnerships with GSK, Wyeth and Pfizer. All three companies have NDAs pending approval and can provide meaningful news flow for Ligand in the near term. Now, for those who familiar with Ligand, you know that we have a license agreement with GlaxoSmithKline for Promacta. GSK filed their first NDA for the drug for the short-term treatment of ITP at the end of last year. GSK was granted expedited review for the drug by the FDA, and we could hear the status of the drug here in the second quarter as GSK announced a few weeks ago that they expect a response on Promacta by the FDA on June 19. After years of development, now we are less than two months away from hearing the status of one of one of Ligand's most important royalty partnerships. Plus, GSK expects to make MAA and NDA submissions for the treatment of long-term ITP this year. In addition to ITP, GSK has two Phase III trials for hepatitis C that were initiated last year and is conducting Phase II trials for CIT as well. Moving on to Wyeth, our partner Wyeth has an NDA pending approval for VIVIANT or bazedoxifene, their SARM…

Thank you, John. In addition to reviewing the first quarter results, I will also update our operating forecast for 2008. Now taking a look at the first quarter, revenues from continuing operations for the first quarter of 2008 were $4.9 million, compared with $235,000 in the first quarter of 2007. The 2008 revenues are related to royalties from AVINZA sales while the 2007 revenues are related to a milestone payment received from Wyeth, as we did not begin to receive AVINZA royalty payments until the second quarter of 2007. Total operating expenses for the first quarter of 2008 were $17.3 million, compared with $29.8 million for the first quarter of 2007. General and administrative expenses for the 2008 quarter include $4.1 million of lease cost and $0.7 million of asset impairment charges, both associated with a building we vacated and subleased in February of 2008. Research and development costs for the first quarter of 2008 include $0.6 million paid to the Salk Institute as a royalty buyout fee related to Pfizer's FABLYN NDA submission. Total operating expenses in the first quarter of 2007 were also unusually high as they included one time items totaling $10.2 million related to our restructuring, and $1 million related to the write- off of certain assets either disposed of or no longer used in our ongoing to operations. For the first quarter of 2008, we reported a loss from continuing operations of $9.3 million or $0.10 per share, it’s compared with a loss from continuing operations of $16.9 million or $0.17 per share for the first quarter of 2007. For the first quarter of 2008, our income from discontinued operations was $5.8 million or $0.06 per share, compared with $291.2 million or $2.89 per share in the first quarter of 2007. The 2008 income from…

Thank you, John. Ligand continues to focus on three main areas, pipeline quality, supported by great science, rigorous cost control, and establishing key collaboration to advanced product development and commercialization. Successful execution in each of these areas is what will drive our value this year and beyond. In the coming months, we believe there will be an exciting news flow from our partners as each expects FDA action, one of which could happen as early as June. A quick recap of the upcoming events, GSK is expecting news on PROMACTA in June. Wyeth's VIVIANT will have an FDA advisory committee panel in the first quarter of 2008 and they expect to file an NDA for APRELA in the first half of 2009. Pfizer submitted an NDA for osteoporosis treatment for FABLYN at the end of the last year, and an MAA early in 2008. For our internal program, we continue to advance our pipeline programs. We've initiated multiple clinical studies for LGD-4465 and again we look forward to filing the IND for the SARM molecule by the end of this year. We are always pleased to get out and meet with investors. We have been active the last couple of months, meeting with analysts and investors. We are presenting at two conferences this quarter. One is May 28, the FBR Capital Markets Conference in New York, and the other is June 11, the Needham Bio Tech and Medtech Conference also in New York. Thank you for joining us. With that, we will turn it over for questions.

(Operator instructions) Your first question comes from the line of David Webber with Broadpoint Capital. David Webber – Broadpoint Capital: Thank you. Couple questions, first just to clarify the projection of $20 million in royalties, is that from AVINZA alone or is that from AVINZA plus potential royalties from other products?

No. That is just AVINZA alone. David Webber – Broadpoint Capital: Okay. Thank you. Regarding LGD-4665, John you mentioned that you had completed the food study with no particular signs of food effect, so does that mean that unlike PROMACTA, there presumably wouldn't be no need to take the capsules two hours before or after eating?

David, that is our expectation at this time. With these pharmacology studies, you're testing the limits of various end points. We really think there is few, if any, limitation with food, and in the protocol, the Phase II study design that we started does not have any express fasting or limitation on food consumption related to intake of the drug, which we are excited about. Clearly it's early in terms of evaluating the drug in sick patients, but if our early Phase I study is proven out in the clinical trials, we think that can be a very important way to differentiate our drug from the competitors. David Webber – Broadpoint Capital: Okay. Can you tell us what the primary end point is in the Phase II ITP trial?

Yes. Sure. Really, we're looking at the increase in platelet counts. There are two ways it's measured. The patients will be enrolled with a baseline of less than 30,000 platelets per microliter of blood. So, that's the baseline enrollment. So, a patient will be scored a success if either they have a doubling of their baseline platelet score or if their ending platelet count after six weeks of treatment is greater than 50,000 platelets per microliter of blood. David Webber – Broadpoint Capital: Okay. Last question is, I was intrigued when Glaxo the other day disclosed their PDUFA date and their expectation (inaudible) by then. What is the latest thinking to your knowledge regarding the likelihood of an advisory committee review?

A good question. We don't know. We don't have any inside track at the GSK's dialogue with the FDA. So, it's just speculation. Obviously, in this category, we know Amgen had a panel meeting, and there's just no communication from GSK publicly about what their expectations are. So, the date that they announced a few weeks ago is essentially six months out from when they first submitted their NDA. So, there's no mystery in that date. But happens now between and then and whether they will have an advisory panel meeting, we do not know. David Webber – Broadpoint Capital: Okay. Thanks very much. I will get back in the queue.

David, thank you.

(Operator instructions) Your next question comes from the line of Derek Jellinek with SIG. Derek Jellinek – Susquehanna Financial Group: Thank you. Just quickly a follow-up on David's question. My question was also on the PDUFA, possibly getting pushed out for PROMACTA. I was wondering, John, you said you didn't really know anything, but if you can comment on the long-term ITP trials, could that possibly get on the label by the PDUFA date?

Again, pure speculation. We don't know. I think looking back historically, GSK filed with one pivotal trial for the short-term treatment of ITP, and of course, we know that they were conducting a second pivotal trial for long-term treatment. It is our estimate that that study was finished a while ago, but obviously not in time for their original filing. So, clearly given the time line that they've communicated where they expect to file – GSK expects to file NDA's in the U.S. and in Europe for the long-term treatment in '08, we will assume that's going to happen. How those two filings will converge, we don't know. Derek Jellinek – Susquehanna Financial Group: All right. Maybe another question, on 4665, I think your trial design is quite interesting. There's only 24 patients, as you said, do you think it's powered enough to shelter additional [ph] significance? I'm trying to do the back of the envelope looking at 24 patients, only 8 patients on placebo. Is that really enough to definitively peak someone's interest when this trial reports out? And on that, when do you think we're going to see data?

Yes, to the first question. We believe that this is a very good study design. It certainly could have included multiple arms. You could always add more patients. But I think to put it in context, GSK has a phenomenal data set, in our opinion. They've run good studies with clear outcomes, and very straightforward end points. So, we do have the benefit of looking at their published information from the clinical studies. They really have helped inform some of our decision-making around our clinical studies. Secondly, we ran our own Phase I study, single to multiple ascending doses and have a very robust set of pharmacology data. So, the study design is focused. The treatment dose is at 7.5 milligrams per day, and it is powered such, obviously, we're really on past efficacy results, but it’s powered as such that we think that that should produce a very clear result for us. That is our expectation, and obviously how we design the study. Now, as far as data, we are working to have data at least interim data by the end of 2008. Ideally, we would like to have some sort of a presentation at ASH. It's early. Obviously, we just announced that the study initiation – we have numerous sites on board. Other sites are still enrolling. It is a smaller study, and only six weeks of treatment. But it's impossible right now to predict what the exact time frame will be for when we will have the definitive data set. Derek Jellinek – Susquehanna Financial Group: Sure. I can appreciate that. On that same study, are you going to stratify for splenectomized versus non-splenectomized patients?

No. Derek Jellinek – Susquehanna Financial Group: Okay. And are you still on track to start your MDS study as well as your own hep C study in the back end of this year?

Yes, yes. We are on track, and that was the plan all along to start multiple studies. What we're focusing on in particular, I will say hepatitis, the path is perhaps clearer for us right now, as I mentioned in my prepared remarks. We're looking at completing a weekly dose study, a Phase I weekly dose study as well as liver impairment study. So, those will really help set the course and the timing for the FC. The NDS indication, we are very interested in. We think it's a logical indication. What we are evaluated with some I think very good input from medical advisors is whether it's a straightforward NDS study or whether we look at therapy induced thrombocytopenia in NDS patients. So, there are a couple of questions, and really I think what works that about is that we see a good market to go into oncology. We've got a few options, and particularly as we see this landscape evolve with Amgen and GSK, we want to put together the best trial plan possible. But we are working on that and certainly expect more developments on those fronts later this year. Derek Jellinek – Susquehanna Financial Group: Great. Maybe one more if I may, quickly. Just I want to get your take on what you think of VIVIANT. It seems like the Wyeth's program keeps getting pushed out further and further. How confident are you in first stage osteoporosis for VIVIANT and APRELA. Looks like that's getting pushed out as well?

Right. I think as a matter of fact, you are correct. It does seem every quarter or two it is pushed out a bit further. So, I think we can all agree upon that. As far as predicting outcomes, that's not our business. I think we are very good business people and good drug developers, but we aren’t in the business to predict regulatory outcomes. Having said that, my sense is that both Wyeth and Pfizer have made tremendous investment and have done some excellent research to get these drugs ready for approval. Osteoporosis is a big market. I think realistically we should expect the FDA is going to be very careful about the review of the safety data. Clearly they've shown that in the past. But on the other hand, it's an incredibly important market. It is a growing category. There is a need for better, safer drugs, and although we're seeing some delays, as discouraging as that is, from our perspective, we actually think that incrementally these drug applications are getting better. They're more focused. Companies are taking more time to answer more safety questions, and again, I think it probably is enhancing their probability of a win despite the push back. So the other thing I will just comment generally obviously, there's been a real focus on osteoporosis prevention with these drugs. The FDA is clearly looking at treatment, and there is some logical thinking in trying to pull these two NDA applications together in the same panel meeting. So again, a bit discouraging, but a big market, important drugs, and we know these two partners are doing their absolute best to increase the chances of regulatory success. Derek Jellinek – Susquehanna Financial Group: Great. Thanks, John, so much for answering the question.

Thank you, Derek. Appreciate your time.

Your next question comes from the line of Chris James with Rodman & Renshaw. Chris James – Rodman & Renshaw: Hi, John, thanks for taking my questions. Just a couple of questions on the ITP drug. Will you be measuring bleeding parameters, and can you speak to some of the safety parameters you will be measuring, specifically on thrombotic events?

Right. Yes, the primary end point again is clearly the increase in platelet count as I discussed. Some secondary end points we look at timed response, how long before we see the increase in platelets, the duration of response as well as bleeding scores. So, those are built in as secondary end points. As far as more technical evaluation of safety end points, I can't speak to those details right now, but clearly we are going to be looking at a whole range of adverse events, collecting data, obviously variability on platelet response and so on. So, like with the Phase I study, we had a very full discussion around our adverse event profile. We will be collecting that data as well in this study. Chris James – Rodman & Renshaw: Great, thanks. Can you talk about the risk map plan that GSK has put forth in their application?

No. Candidly, I'm not familiar with it at all, and even if I were or my colleagues were, I would direct you to GSK to have them describe their thinking or plans behind that. Chris James – Rodman & Renshaw: Sure. Thanks.

Thanks for asking. I appreciate your interest, but I think that given the technical nature of that, I think that's more appropriate for GSK to respond to. Chris James – Rodman & Renshaw: Great. I understand. Thanks.

Thank you, Chris.

(Operator instructions) At this time we have no further questions I will turn the call back over to Erika for final comments.

Okay. Thank you. Well, appreciate everybody's time and attention. I know it was a very busy day for earnings calls. We always appreciate people joining us firsthand and again, we've got an exciting year ahead of us. If you're in New York in late May or mid-June, we will be at the conferences and we look forward to seeing you in person. Thank you.

Thank you. This concludes today's conference call. You may now disconnect.