By Kim Coghill

Washington Editor

Ligand Pharmaceuticals Inc. and TAP Pharmaceutical Products Inc. have entered a three-year research and development agreement for selective androgen receptor modulators (SARMs) for indications such as hypogonadism, male and female sexual dysfunction, male and female osteoporosis, frailty and male hormone replacement therapy (HRT).

The deal is worth up to $44 million for Ligand in research funding and milestones if two products are successfully developed. The agreement includes a near-term milestone of $3.5 million related to LGD2226, Ligand¿s lead SARM, which is expected to be the subject of an investigational new drug application early next year. Paul Maier, senior vice president and chief financial officer of Ligand, said the indication for LGD2226 has not yet been selected.

Ligand, of San Diego, has several products on the market, including Targretin capsules, Targretin gel, ONTAK and Panretin gel. Another product, Morphelan for pain control, is in the review process at the FDA. Ligand has collaboration agreements with several companies, including Pfizer Inc., of New York; Abbott Laboratories, of Abbott Park, Ill.; and Eli Lilly and Co., of Indianapolis.

¿We have a very powerful technology platform that we are trying to develop, and to exploit some of the large market applications requires resources beyond the scope of a small company,¿ Maier said. ¿We have been working for a number of years in the androgen receptor program and many of the diseases that we are targeting are large diseases that require a lot of expertise and resources. TAP has significant expertise in developing drugs in the areas of urology, gynecology and endocrinology, so when you match our discovery engine with their capabilities in development, you have an excellent collaborative partnership.¿

SARMs are a novel class of orally active nonsteroidal molecules that target modulation of the androgen receptor and are designed to enhance the beneficial effects of androgen receptor activation while reducing or eliminating the undesired side effects.

Under terms of the deal, TAP, of Lake Forest, Ill., has been granted exclusive worldwide rights to manufacture and sell any products resulting from the collaboration in its field, including treatment and prevention of hypogonadism, male sexual dysfunction, female osteoporosis, male HRT and other indications not retained by Ligand.

Ligand stands to receive up to double-digit royalties as compounds are developed and commercialized. Ligand retains some rights in the androgen receptor field, including the prevention or treatment of prostate cancer, benign hyperplasia, acne and hirsutism.

TAP is a joint venture between Abbott Laboratories and Takeda Chemical Industries Ltd., of Osaka, Japan. The company markets Lupron Depot for palliative treatment of advanced prostate cancer, management of endometriosis, anemia caused by uterine fibroids and central precocious puberty. The company also markets Prevacid for the treatment of acid-related disorders, including gastroesophageal reflux disease and ulcers.

Ligand¿s stock (NASDAQ:LGND) closed Tuesday at $11.89, up 69 cents.