S-3

As filed with the Securities and Exchange Commission on May 20, 2009

Registration No. 333-            

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form S-3

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

LIGAND PHARMACEUTICALS INCORPORATED

(Exact name of registrant as specified in its charter)

Delaware	77-0160744
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)

10275 Science Center Drive

San Diego, California 92121-1117

(858) 550-7500

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

John L. Higgins

President and Chief Executive Officer

Ligand Pharmaceuticals Incorporated

10275 Science Center Drive

San Diego, California 92121-1117

(858) 550-7500

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies To:

Scott N. Wolfe, Esq.

Latham & Watkins LLP

12636 High Bluff Drive, Suite 400

San Diego, California 92130

(858) 523-5400

Approximate date of commencement of proposed sale to the public:  From time to time after the effective date of this registration statement.

If the only securities being registered on this form are being offered pursuant to dividend or interest reinvestment plans, check the following box.  ¨

If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, as amended, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box.  þ

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨             

If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨             

If this form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become effective upon filing with the Securities and Exchange Commission pursuant to Rule 462(e) under the Securities Act, check the following box.  ¨

If this form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box.  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer  ¨	Accelerated filer  x
Non-accelerated filer  ¨ (Do not check if a smaller reporting company)	Smaller reporting company  ¨

CALCULATION OF REGISTRATION FEE

Title of Each Class of Securities to be Registered	Amount to be Registered(1)	Proposed Maximum Offering Price Per Share	Proposed Maximum Aggregate Offering Price	Amount of Registration Fee
Common stock, par value $0.001 per share	867,637 shares	$8.59(2)	$7,453,002(2)	$415.88
Common stock, par value $0.001 per share	5,062 shares	$8.91(3)	$45,102(3)	$2.51
Total			$7,498,104	$418.39

(1) Pursuant to Rule 416(a), this Registration Statement shall also cover any additional shares of the registrant’s common stock that become issuable by reason of any stock dividend, stock split, recapitalization or other similar transaction effected without receipt of consideration.

(2) Estimated solely for purposes of calculating the registration fee in accordance with Rule 457(g). The price per share and aggregate offering price are calculated on the basis of the exercise price of $8.59 for 867,637 shares subject to outstanding warrants.

(3) Estimated solely for purposes of calculating the registration fee in accordance with Rule 457(h). The price per share and aggregate offering price are calculated on the basis of the weighted average exercise price of $8.91 for 5,062 shares subject to outstanding stock options granted under the Pharmacopeia, Inc. Amended and Restated 2004 Stock Incentive Plan and the Pharmacopeia, Inc. 2000 Stock Option Plan.

(4) Each share of common includes a right to purchase one one-thousandth of a share of Series A Junior Participating Preferred Stock, par value $0.001 per share.

The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this registration statement shall become effective on such date as the SEC, acting pursuant to said Section 8(a), may determine.

The information in this prospectus is not complete and may be changed. Ligand Pharmaceuticals Incorporated may not sell these securities until the registration statement filed with the Securities and Exchange Commission, of which this prospectus is a part, is effective. This prospectus does not constitute an offer to sell, or a solicitation of an offer to purchase, the securities described in this prospectus, or the solicitation of a proxy, in any jurisdiction to or from any person to whom or from whom it is unlawful to make such offer, solicitation of an offer or proxy solicitation in such jurisdiction.

Subject to completion, dated May 20, 2009

PROSPECTUS

Ligand Pharmaceuticals Incorporated

872,699 Shares of Common Stock Issuable Upon

Exercise of Warrants and Options

This prospectus relates to an aggregate of:

• the resale of up to 867,637 shares of common stock, par value $0.001 per share, issued upon the exercise of certain warrants; and

• the issuance of up to 5,062 shares of common stock, par value $0.001 per share, upon the exercise of certain options.

In connection with a merger transaction between Ligand Pharmaceuticals Incorporated, or Ligand, and Pharmacopeia, Inc., or Pharmacopeia, certain warrants to purchase 1,449,696 shares of common stock of Pharmacopeia, were assumed by Ligand and became exercisable to purchase 867,637 shares of Ligand common stock. Also in connection with the merger, certain options to purchase 8,473 shares of common stock of Pharmacopeia, granted under the Pharmacopeia, Inc. Amended and Restated 2004 Stock Incentive Plan, or the 2004 Plan and the Pharmacopeia, Inc. 2000 Stock Option Plan, or the 2000 Plan were assumed by Ligand and became exercisable to purchase 5,062 shares of Ligand common stock. This prospectus relates to the resale by certain selling security holders, from time to time, of up to 867,637 shares of Ligand common stock issuable upon the exercise of the assumed Pharmacopeia warrants and to the offer and sale by Ligand of up to 5,062 shares of common stock issuable upon the exercise of the assumed Pharmacopeia options, and the resale of such shares of common stock.

Our common stock is listed for trading on the Nasdaq Global Market under the symbol “LGND.” On May 13, 2009, the closing price of our common stock on the Nasdaq Global Market was $2.57 per share.

The selling security holders described in the section entitled “Selling Security Holders” beginning on page 6 of this prospectus or their transferees may offer from time to time up to an aggregate of 872,699 shares of our common stock (including 867,637 shares issuable upon exercise of the assumed Pharmacopiea warrants and 5,062 shares issuable upon exercise of the assumed Pharmacopeia options.

We will not receive any proceeds from the sale of shares of common stock issuable upon exercise of the assumed Pharmacopeia warrants and assumed Pharmacopeia options by the selling security holders. We will receive proceeds from the exercise of the warrants and options as follows:

Warrants

	Total(1)		Per Share
Price	$	7,451,385.43	$	8.59
Underwriter’s Discounts and Commissions	$	—		—
Net Proceeds	$	7,451,385.43	$	8.59
Options
Price	$	43,466.63		(2)
Underwriter’s Discounts and Commissions	$	—		—
Net Proceeds	$	43,446.63		(2)

(1) These amounts presume that all warrants and options, as applicable, are exercised.

(2) The exercise price of each option varies from $6.28 to $12.05 depending on the date of grant of such option.

For information on the possible methods of sale that may be used by the selling security holders, see “Plan of Distribution” beginning on page 8 of this prospectus.

Investing in our securities involves risks. See “Risk Factors” on page 2.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

Our principal executive offices are located at 10275 Science Center Drive, San Diego, California, 92121. Our telephone number is (858) 550-7500.

The date of this prospectus is                     , 2009

TABLE OF CONTENTS

	Page
ABOUT THIS PROSPECTUS	1
RISK FACTORS	2
FORWARD-LOOKING STATEMENTS	2
USE OF PROCEEDS	2
DETERMINATION OF WARRANT AND OPTION EXERCISE PRICES	3
DESCRIPTION OF CAPITAL STOCK	4
SELLING SECURITY HOLDERS	8
PLAN OF DISTRIBUTION	12
LEGAL MATTERS	15
EXPERTS	15
DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES	15
WHERE YOU CAN FIND MORE INFORMATION	15
INCORPORATION BY REFERENCE	16

ABOUT THIS PROSPECTUS

You should rely only on the information contained in this prospectus. Neither we nor the selling stockholders have authorized anyone to provide you with information different from that contained in this prospectus or additional information. We are not making an offer of these securities in any state where the offer is not permitted. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or any sale of our common stock. Our business, financial condition, results of operations and prospects may have subsequently changed since the date of this prospectus or any prospectus supplement or the date of any document incorporated by reference.

In some cases, the selling stockholders will also be required to provide a prospectus supplement containing specific information about the selling stockholders and the terms on which they are offering and selling our common stock. We may also add, update or change in a prospectus supplement any information contained in this prospectus. You should read this prospectus and any accompanying prospectus supplement, as well as any post-effective amendments to the registration statement of which this prospectus is a part, together with the additional information described under “Where You Can Find More Information” before you make any investment decision.

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RISK FACTORS

Investment in our common stock involves a high degree of risk. You should carefully consider the specific risks described under the heading “Risk Factors” in any applicable prospectus supplement and under the caption “Risk Factors” in any of our filings with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Securities and Exchange Act of 1934, as amended, or the Exchange Act, which are incorporated herein by reference, before making an investment decision. Each of the risks described in these headings could adversely affect our business, financial condition, results of operations and prospects, and could result in a complete loss of your investment. For more information, see “Where You Can Find More Information.”

FORWARD-LOOKING STATEMENTS

This prospectus and the documents incorporated by reference into this prospectus contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties, as well as assumptions, that, if they never materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such forward-looking statements. Forward-looking statements generally are identified by the words “may,” “will,” “project,” “might,” “expects,” “anticipates,” “believes,” “intends,” “estimates,” “should,” “could,” “would,” “strategy,” “plan,” “continue,” “pursue”, or the negative of these words or other words or expressions of similar meaning. All statements other than statements of historical fact are statements that could be deemed forward-looking statements. For example, forward-looking statements include statements about our future financial and operating results, plans, expectations for potential research and development payments, cash burn rates, timing of achieving positive cash flow, potential revenue and profits of a combined company, costs and expenses, interest rates, outcome of contingencies, financial condition, liquidity, business strategies and cost savings, any statements of the plans, strategies and objectives of management for future operations, any statements concerning our product candidates and product development, any statements regarding future economic conditions or performance, statements of belief and any statement of assumptions underlying any of the foregoing. The risks, uncertainties and assumptions referred to above include other risks and uncertainties that are incorporated by reference into this prospectus.

If any of these risks or uncertainties materializes or any of these assumptions proves incorrect, the our results could differ materially from the expectations in these statements. The forward-looking statements included in this prospectus are made only as of the date of this prospectus, and we are not under any obligation to update our respective forward-looking statements and do not intend to do so.

USE OF PROCEEDS

Any proceeds received by us from the exercise of the assumed Pharmacopeia warrants, representing the exercise price for these warrants, or the exercise of the assumed Pharmacopeia options, representing the exercise price for these options, will be used for general corporate purposes. The actual amount of proceeds we receive on exercise of the assumed Pharmacopeia warrants or the exercise of the assumed Pharmacopeia options will depend on how many warrants or options are ultimately exercised. However, if all the assumed Pharmacopeia warrants and the assumed Pharmacopeia options were exercised, the aggregate proceeds would not exceed approximately $7.5 million. We will not receive any of the proceeds from the sale of the shares of the common stock issuable upon exercise of the assumed Pharmacopeia warrants and assumed Pharmacopeia options by the selling stockholders.

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DETERMINATION OF WARRANT AND OPTION EXERCISE PRICES

The offering price for the shares issuable upon exercise of the warrants and options covered by this prospectus is the exercise price of the warrants and options, respectively, which was determined at the time the warrants and options were issued. In accordance with the terms of the merger agreement between us and Pharmacopeia, each Pharmacopeia warrant and option outstanding at the time of the merger was assumed by us and became exercisable for that number of shares of Ligand common stock equal to 0.5985 times the number of shares of Pharmacopeia common stock for which such warrant or option was exercisable before the merger, rounded down to the nearest whole number of shares, plus certain cash consideration, cash in lieu of any fractional share of Ligand common stock and certain contingent value rights. The exercise price per share of each assumed Pharmacopeia warrant and option is equal to the exercise per share of such warrant or option prior to the merger, divided by 0.5985, rounded up to the nearest whole cent. The determination of the exchange ratio of 0.5985 was established through negotiation between the parties to the merger.

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DESCRIPTION OF CAPITAL STOCK

The authorized capital stock of Ligand consists of 200,000,000 shares of common stock, $0.001 par value per share, and 5,000,000 shares of preferred stock, $0.001 par value per share. At May 13, 2009, there were 112,978,603 shares of common stock outstanding and no shares of preferred stock outstanding.

The following description of certain matters related to our capital stock is a summary and is qualified in its entirety by the provisions of our certificate of incorporation and bylaws.

Common Stock

In connection with our acquisition of Pharmacopeia by merger, we agreed to register up to 872,699 shares of our common stock issuable upon exercise of certain warrants and options described above. The holders of common stock are entitled to one vote for each share held of record on all matters submitted to a vote of the stockholders. Subject to preferences that may be applicable to any outstanding preferred stock, holders of common stock are entitled to receive ratably such dividends as may be declared by our Board of Directors out of funds legally available. In the event of our liquidation, dissolution or winding up, holders of common stock are entitled to share ratably in all assets remaining after payment of liabilities and the liquidation preference of any outstanding preferred stock. Holders of common stock have no preemptive rights and no right to cumulate votes in the election of directors. There are no redemption or sinking fund provisions applicable to the common stock. All outstanding shares of common stock are fully paid and nonassessable.

Warrants

In connection with our acquisition of Pharmacopeia by merger, we agreed to register for resale 867,637 shares of common stock issuable upon the exercise of redeemable common stock purchase warrants, each exercisable into one share of our common stock at $8.59 per share. The warrants may be exercised from the date of this prospectus until October 2011. The warrants may be exercised in whole or in part upon surrender of the warrant certificate on or prior to the expiration date to us or at the office of our warrant agent, completion of the notice of exercise form included as part of the warrant certificate and full payment of the exercise price by wire transfer or immediately available funds for the number of warrants being exercised. The warrants may also be exercised by means of a “cashless exercise” if the volume weighted average share price on the business day immediately preceding the exercise date is greater than the exercise price. A “cashless exercise” means that in lieu of paying the aggregate purchase price for the shares being purchased upon exercise of the warrants in cash, the holder will forfeit a number of shares underlying the warrants with a “fair market value” equal to such aggregate exercise price. We will not receive additional proceeds if the warrants are exercised by cashless exercise.

The exercise price and number of shares of common stock issuable upon exercise of the warrants may be adjusted in certain circumstances, including in the event of a stock dividend, a capital reorganization or reclassification, a merger or a consolidation. The warrant holders do not have the rights or privileges of holders of common stock and any voting rights until they exercise their warrants and receive shares of common stock. If the holder of a warrant elects to exercise all or any part of a warrant when there is no effective registration statement permitting the sale of the underlying shares of common stock by us to the holder, then we may, upon such exercise, issue shares of our common stock to the holder with appropriate legends and subject to resale restrictions.

Pharmacopeia, Inc. 2000 Stock Option Plan and Pharmacopeia, Inc. 2004 Stock Incentive Plan

In connection with our acquisition of Pharmacopeia by merger, we agreed to register shares of common stock issuable upon exercise of stock options, of which 5,062 are outstanding. Ligand has included a copy of the Pharmacopeia, Inc. 2000 Stock Option Plan, or the 2000 Plan, and the Pharmacopeia, Inc. 2004 Stock Incentive

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Plan, or the 2004 Plan, and together with the 2000 Plan, the Plans, as exhibits to the Registration Statement of which this Prospectus forms a part. The Plans were assumed by Ligand on December 23, 2008 in connection with our acquisition of Pharmacopeia by merger.

The following summary of certain provisions of the Plans does not purport to be complete and is subject to, and qualified in its entirety by reference to, the provisions of the Plans, including the definitions therein of certain terms. The Plans are not pension, profit-sharing, or stock bonus plans designed to qualify under Section 401(a) of the Internal Revenue Code of 1986, as amended, or the Code, or employee benefit plans subject to any of the provisions of the Employee Retirement Income Security Act of 1974.

General

Ligand common stock will be issued upon exercise of options granted under the Plans. Effective as of the consummation of the acquisition of Pharmacopeia by Ligand, the share reserves under the Plans were reduced so that such reserves are equal to the number of shares of Ligand common stock issuable upon exercise of the assumed Pharmacopeia options. No additional awards will be granted under the Plans.

Administration of the Plans

The Plans are administered by the Compensation Committee, or the Committee, of the Board of Directors. The Committee has the power to interpret the Plans and to prescribe rules and regulations relating thereto. Copies of the Plans and additional information about the Plans and the administrators may be obtained from Ligand Pharmaceuticals Incorporated, Investor Relations, 10275 Science Center Drive, San Diego, California 92121, (858) 550-7500.

Each stock option granted under the Plans is evidenced by a written award agreement between the grantee and us and is subject to the terms and conditions described below.

Terms and Conditions of Options

Types of Options. While the Plans authorize the granting of either incentive stock options or nonqualified stock options, all of the assumed Pharmacopeia options that remain outstanding under the Plans are nonqualified stock options.

Exercise Price. The exercise price of an option to purchase shares of Pharmacopeia common stock granted under the Plans was determined at the time the option was granted. The exercise price was not less than 100% of the fair market value of the company’s common stock on the date the option was granted. Generally, the fair market value was the closing sale price for such stock on the date of determination as quoted on The Nasdaq Stock Market.

The means of payment for shares issued upon exercise of an option is specified in each option agreement and generally may be made by cash, certain other shares of common stock owned by the optionee for at least six months, delivery of an exercise notice together with irrevocable instructions to a broker chosen by the optionee (and reasonably agreeable to the plan administrator) to deliver the exercise price to us from the sale proceeds (a cashless exercise), any combination of the foregoing methods, or any other consideration to the extent permitted under applicable law. Some of the foregoing payment methods may require the consent of the plan administrator.

Term of the Option. Each stock option agreement specifies the type of option, the term of the option, and the date when the option will become exercisable. However, the term of an option granted under the 2004 Plan is no longer than ten years from the date of grant.

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Transferability of Options

The Plans provide that stock options granted thereunder are generally not transferable by a participant except by will or by the laws of descent and distribution and are exercisable during the participant’s lifetime only by the Participant. However, the Plans also provide that the plan administrator may permit certain transfers of nonqualified stock options, on a general or specific basis, in its sole discretion.

Amendment and Termination of the Plans

Ligand’s Board of Directors may modify, amend, or terminate the Plans at any time, except that, to the extent then required by the Plans or an applicable law, rule, or regulation, approval of the company’s stockholders will be required. No amendment, modification or termination shall adversely affect the rights of a participant under a grant previously made to a participant without the consent of the participant.

Federal Income Tax Consequences under the Plans

A participant does not recognize any taxable income at the time he or she is granted a nonqualified stock option. Upon exercise, the participant recognizes ordinary taxable income generally measured by the excess of the then fair market value of the shares over the exercise price. Any taxable income recognized in connection with an option exercise by an employee of the company is subject to tax withholding by us. We are entitled to a deduction in the same amount as the ordinary income recognized by the participant. Upon a disposition of such shares by the participant, any difference between the sale price and the participant’s exercise price, to the extent not recognized as taxable income as provided above, is treated as long-term or short-term capital gain or loss, depending on the holding period.

The foregoing is only a summary of the effect of federal income taxation upon award grantees and us with respect to the grant and exercise of non-qualified stock options under the Plans. It does not purport to be complete, and does not discuss the tax consequences of the employee’s death or the provisions of the income tax laws of any municipality, state or foreign country in which the employee or consultant may reside.

Preferred Stock

As of May 13, 2009, we had no shares of preferred stock outstanding.

Under the terms of our amended and restated certificate of incorporation, our board of directors has the authority, without further action by the stockholders and subject to the limits imposed by the Delaware General Corporation Law to issue shares of preferred stock in one or more series and to designate the rights, preferences, privileges and restrictions of each such series. The issuance of preferred stock could have the effect of restricting dividends on the common stock, diluting the voting power for the common stock, impairing the liquidation rights of the common stock or delaying or preventing a change in control without further action by the stockholders. At present, we have no plans to issue any shares of preferred stock.

Stockholder Rights Plan

On October 13, 2006, our board of directors adopted a stockholder rights plan. Our board of directors declared a dividend of one preferred share purchase right for each outstanding share of our common stock at the close of business on October 13, 2006. Each right entitles the registered holder thereof, after the rights become exercisable and until October 13, 2016 (or the earlier redemption, exchange or termination of the rights), to purchase from us one 1/1000th of a share of Series A Participating Preferred Stock, or Series A Preferred, at a price of $100.00, subject to certain anti-dilution adjustments. The rights do not become exercisable until the earlier to occur of:

• 10 days (or such later date as may be determined by our board of directors) following a public announcement that a person or group of affiliated or associated persons has acquired, or obtained the right to acquire, beneficial ownership of 20% or more of our outstanding common stock (any such person or group is referred to as an acquiring person); or

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• 10 days (or such later date as may be determined by our board of directors) following the commencement or announcement of an intention to make a tender offer or exchange offer the consummation of which would result in the beneficial ownership by a person or group of 20% or more of our outstanding common stock.

Each share of Series A Preferred purchasable upon exercise of the rights will be entitled to an aggregate dividend of 1,000 times the dividend declared per share of common stock. Each share of Series A Preferred will have 1,000 votes, voting together with the shares of common stock. In the event of any merger, consolidation or other transaction in which the shares of common stock are changed or exchanged, each share of Series A Preferred will be entitled to receive 1,000 times the amount received per shares of common stock. These rights are protected by customary anti-dilution provisions.

In the event that, at any time following the date on which there has been public disclosure that a person or group has become an acquiring person, Ligand is acquired in a merger or other business combination transaction, or 50% or more of Ligand’s consolidated assets or earning power are sold (other than in transactions in the ordinary course of business), proper provision shall be made so that each holder of a right which has not been exercised will thereafter have the right to receive, upon exercise, shares of common stock of the acquiring company having a value equal to two times the purchase price.

At any time after the acquisition by an acquiring person of 20% or more of Ligand’s outstanding shares of common stock and prior to the acquisition by such acquiring person of 50% or more of Ligand’s outstanding shares of common stock, our board of directors may exchange the rights (other than rights owned by the acquiring person), in whole or in part, at an exchange ratio of one shares of common stock per right, subject to adjustment.

The rights will expire on October 13, 2016, unless earlier redeemed, exchanged or terminated. Until a right is exercised, the rights do not convey the right to vote, receive dividends or otherwise provide the holder with any rights as a stockholder.

The rights may be redeemed in whole, but not in part, at a price of $0.01 per right at any time prior to the time that an acquiring person has become such. The redemption of the rights may be made effective at such time, on such basis and with such conditions as our board of directors in its sole discretion may establish.

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SELLING SECURITY HOLDERS

The following table sets forth the name of each selling security holder and the number of our warrants, options and shares of common stock beneficially owned by each selling security holder as of on or around March 31, 2009 and the percentage of our outstanding warrants, options and shares of common stock beneficially owned by each selling security holder as of March 31, 2009. The actual amount, if any, of warrants or shares of common stock to be offered by each selling security holder and the amount and percentage of warrants and shares of common stock to be owned by such selling security holder following such offering is unknown. For a description of the warrants and options see “Description of Capital Stock.”

The number of warrants, options and shares of common stock beneficially owned by each selling security holder is determined according to the rules of the SEC, and the information is not necessarily indicative of beneficial ownership for any other purpose. Under current rules, beneficial ownership includes any warrants, options or shares as to which the individual or entity has sole or shared voting power or investment power. As a consequence, several persons may be deemed to be the “beneficial owners” of the same warrants, options or shares. Unless otherwise noted in the footnotes to this table, each of the security holders named in this table has sole voting and investment power with respect to the warrants, options or shares of common stock shown as beneficially owned. The percentage ownership of each selling security holder is calculated based on the warrants, options and shares of common stock that would be outstanding assuming that all warrants and other options held by the selling security holders that are exercisable within 60 days from the date of this prospectus have been fully exercised.

We are registering all of the shares covered by this prospectus on behalf of the selling security holders in accordance with certain obligations. This prospectus also covers any common stock that becomes issuable by reason of any stock dividend, stock split, recapitalization or other similar transaction effected without the receipt of consideration that results in an increase in the number of our shares of common stock and to cover the issuance of shares of common stock upon the exercise of the warrants or options by persons other than the selling security holders. We are registering shares to permit the selling security holders to offer these shares of common stock for resale from time to time. Because the selling security holders may sell all, some or no part of their respective shares of common stock covered by this prospectus, we cannot estimate the number of shares of common stock that will be held by the selling security holders upon the termination of this offering. For more information, see “Plan of Distribution.”

Warrant Holders

	Common Stock
Selling Security Holder	Beneficially Owned Before Offering			Being Offered(2)	Beneficially Owned After Offering(2)
Name(1)	Number	Percent		Number	Number	Percent
Biotech Growth Trust PLC(3)	78,104	*		78,104	—	—
Federated Kaufmann Fund(4)	134,662	*		134,662	—	—
Balyasny Asset Management, LP(5)	112,218	*		112,218	—	—
Merlin Nexus II, LLC(6)	104,737	*		104,737	—	—
Funds affiliated with BVF Partners, LP(7)	17,102,783	15.14	%	86,782	17,016,001	15.06	%
Funds affiliated with OZ Capital Management(8)	67,331	*		67,331	—	—
Funds affiliated with AWM Investment Company(9)	241,643	*		52,368	189,275	*
Senvest Master Fund LP(10)	301,504	*		37,406	264,098	*
Kilkenny Capital Management, LLC(11)	36,358	*		36,358	—	—
Highbridge International LLC(12)	29,925	*		29,925	—	—
Funds affiliated with Straus Asset Management, LLC(13)	13,466	*		13,466	—	—
Otago Partners, LLC(14)	12,536	*		12,536	—	—
Advantage Ad Multi Sector Fd I(15)	4,907	*		4,788	119	*
Alexandra Investment Management, LLC(16)	4,488	*		4,488	—	—
Additional warrant holders(s)(17)	92,468	*		92,468	—	—
Total	18,337,130	16.23	%	867,637	17,469,493	15.46	%

* Represents less than 1.0%.

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(1) Unless otherwise noted, this table is based on information supplied to us by the selling stockholders and certain records of Pharmacopeia.

(2) We do not know when or in what amounts a selling stockholder may offer shares for sale. The selling stockholders might not sell any or all of the shares offered by this prospectus. Because the selling stockholders may offer all or some of the shares pursuant to this offering and because there are currently no agreements, arrangements or understandings with respect to the sale of any of the shares, we cannot estimate the number of the shares that will be held by the selling stockholders after completion of the offering. However, for purposes of this table, we have assumed that, after completion of the offering, none of the shares covered by this prospectus will be held by the selling stockholders.

(3) Includes warrants to purchase 78,104 shares of common stock. Orbimed Capital LLC is the Investment Manager of Biotech Growth Trust PLC. Samuel D. Islay, a principal owner of Orbimed Capital LLC, has voting and investment control of the securities held by Biotech Growth Trust PLC.

(4) Includes warrants to purchase 134,662 shares of common stock.

(5) Includes warrants to purchase 112,218 shares of common stock.

(6) Includes warrants to purchase 104,737 shares of common stock.

(7) Includes warrants to purchase approximately 18,673 shares of common stock and 3,826,513 shares of common stock held by Biotechnology Value Fund, LP, warrants to purchase 12,867 shares of common stock and 2,648,783 shares of common stock held by Biotechnology Value Fund II, LP, warrants to purchase 5,566 shares of common stock and 1,009,786 shares of common stock held by Investment 10, LLC and warrants to purchase 49,675 shares of common stock and 9,530,919 shares of common stock held by BVF Investments, LLC. Mark Lampert, as President of BVF, Inc., which is the general partner of BVF Partners, LP, which is the general partner of Biotechnology Value Fund, LP and Biotechnology Value Fund II, LP, the manager of BVF Investments, LLC, and the investment manager of Investment 10, LLC, may be deemed to have investment and/or voting control of the securities held by Biotechnology Value Fund, LP, Biotechnology Value Fund II, LP, Investment 10, LLC and BVF Investments, LLC.

(8) Includes warrants to purchase 63,613 shares of common stock held by OZ Master Fund, Ltd., warrants to purchase 1,323 shares of common stock held by Gordel Holdings Limited, warrants to purchase 840 shares of common stock held by GPC LVII, LLC, warrants to purchase 811 shares of common stock held by Goldman Sachs & Co. Profit Sharing Master Trust and warrants to purchase 744 shares of common stock held by OZ Global Special Investments Master Fund, LP. Daniel S. Och, as Chief Executive Officer of Och-Ziff Holding Corporation, which is the general partner of OZ Management LP, which is the investment manager of Oz Master Fund, Ltd., Gordel Holdings Limited, GPC LVII, LLC and Goldman Sachs & Co. Profit Sharing Master Trust, may be deemed to have investment and/or voting control of the shares held by OZ Master Fund, Ltd., Gordel Holdings Limited, GPC LVII, LLC and Goldman Sachs & Co. Profit Sharing Master Trust. Daniel S. Och, as Chief Executive Officer of Och-Ziff Holding Corporation, which is the General Partner of Oz Advisors II, LP, which is the General Partner of OZ Global Special Investments Master Fund, LP, may be deemed to have investment and/or voting control of the securities held by OZ Global Special Investments Master Fund, LP.

(9) Includes warrants to purchase approximately 26,184 shares of common stock and 88,452 shares of common stock held by Special Situations Private Equity Fund, LP and warrants to purchase approximately 26,184 shares of common stock and 100,823 shares of common stock held by Special Situations Life Sciences Fund, LP. AWM Investment Company, Inc. is the investment advisor to Special Situations Private Equity Fund, LP and Special Situations Life Sciences Fund, LP David M Greenhouse and Austin W. Marxe are the principal owners of AWM Investment Company, Inc. and through their control of AWM Investment Company, Inc. share voting and investment control over the securities held by Special Situations Private Equity Fund, LP and Special Situations Life Sciences Fund, LP.

(10) Includes warrants to purchase 37,406 shares of common stock and 264,098 shares of common stock.

(11) Includes warrants to purchase 36,358 shares of common stock.

(12) Includes warrants to purchase 29,925 shares of common stock. Highbridge Capital Management, LLC is the trading manager of Highbridge International LLC and has voting control and investment discretion over the securities held by Highbridge International LLC. Glenn Dubin and Henry Swieca control Highbridge Capital Management, LLC and have voting control and investment discretion over the

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securities held by Highbridge International LLC. Each of Highbridge Capital Management, LLC, Glenn Dubin and Henry Swieca disclaims beneficial ownership of the securities held by Highbridge International LLC.

(13) Includes warrants to purchase 6,703 shares of common stock held by Straus-GEPT Partners, LP and warrants to purchase 6,763 shares of common stock held by Straus Partners, LP. Andrew Marks, as Managing and Principal General Partner of Straus-GEPT Partners, LP and Straus Partners, LP may be deemed to have investment and/or voting control of the securities.

(14) Lindsey Rosenwald, as Managing Member of Straus, and Michael Chill, as Partner and Investment Advisor, may be deemed to have investment and/or voting control of the securities.

(15) Includes warrants to purchase 4,708 shares of common stock and 119 shares of common stock. Eden Capital Management Partners, LP, may be deemed to have investment and/or voting control of the securities.

(16) Includes warrants to purchase 4,488 shares of common stock.

(17) Includes warrants to purchase 92,468 shares of common stock which were sold by certain selling security holders to persons whose identity is currently unknown. We intend to file a prospectus supplement setting forth information relating to such persons as soon as it becomes available and prior to the issuance of any shares of common stock issuable upon exercise of such warrants.

Option Holders

	Common Stock
Selling Security Holder	Beneficially Owned Before Offering		Being Offered(2)	Beneficially Owned After Offering(2)
Name(1)	Number	Percent	Number	Number	Percent
Laura Angelucci(3)	53	*	53	—	—
Nasrin Ansari(4)	693	*	40	653	*
Shalini Bansai(5)	221	*	221	—	—
Wie Qing Chen(6)	430	*	430	—	—
Camelia Chiriac(7)	209	*	209	—	—
Amy Hines(8)	59	*	59	—	—
Padma Kosunam(9)	398	*	398	—	—
Dennis Lyons(10)	84	*	84	—	—
John Olson(11)	381	*	381	—	—
John Paciotti(12)	109	*	109	—	—
Ajay Panyda(13)	237	*	166	71	*
Susan Parlato(14)	99	*	99	—	—
Peter Prokopiw(15)	253	*	253	—	—
Yajing Rong(16)	159	*	159	—	—
Safdar Shamsi(17)	52	*	52	—	—
Joel Srigiri(18)	299	*	299	—	—
Dawit Tadesse(19)	592	*	592	—	—
Ming Wang(20)	261	*	261	—	—
Zhaoying Zhang(21)	2,992	*	1,197	1,795	*
Total	7,581	*	5,062	2,519	*

* Represents less than 1.0%.

(1) Unless otherwise noted, this table is based on information supplied to us by the selling stockholders and certain records of Pharmacopeia.

(2) We do not know when or in what amounts a selling stockholder may offer shares for sale. The selling stockholders might not sell any or all of the shares offered by this prospectus. Because the selling stockholders may offer all or some of the shares pursuant to this offering and because there are currently

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no agreements, arrangements or understandings with respect to the sale of any of the shares, we cannot estimate the number of the shares that will be held by the selling stockholders after completion of the offering. However, for purposes of this table, we have assumed that, after completion of the offering, none of the shares covered by this prospectus will be held by the selling stockholders.

(3) Includes options to purchase 53 shares of common stock.

(4) Includes options to purchase 40 shares of common stock and 653 shares of common stock.

(5) Includes option to purchase 221 shares of common stock.

(6) Includes options to purchase 430 shares of common stock.

(7) Includes options to purchase 209 shares of common stock.

(8) Includes options to purchase 59 shares of common stock.

(9) Includes options to purchase 398 shares of common stock.

(10) Includes options to purchase 84 shares of common stock.

(11) Includes options to purchase 381 shares of common stock.

(12) Includes options to purchase 109 shares of common stock.

(13) Includes options to purchases 166 shares of common stock and 71 shares of common stock.

(14) Includes options to purchase 99 shares of common stock.

(15) Includes options to purchase 253 shares of common stock.

(16) Includes options to purchase 159 shares of common stock.

(17) Includes options to purchase 52 shares of common stock.

(18) Includes options to purchase 299 shares of common stock.

(19) Includes options to purchase 592 shares of common stock.

(20) Includes options to purchase 261 shares of common stock.

(21) Includes options to purchase 1,197 shares of common stock and 1,795 shares of common stock.

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PLAN OF DISTRIBUTION

The common stock issuable upon exercise of our warrants and options will be distributed solely to existing warrant or option holders or their permitted transferees. The warrants and options are immediately exercisable, and the shares of common stock issued upon exercise of the warrants and options will be freely tradable. We do not know if or when the warrants or options will be exercised. We also do not know whether any of the common stock acquired upon exercise of the warrants or options will be sold pursuant to this prospectus.

The selling security holders, or their pledgees, donees, transferees, or any of their successors in interest selling securities received from a named selling security holder as a gift, partnership distribution or other non-sale-related transfer after the date of this prospectus (all of whom may be selling security holders), may sell some, none or all of the securities covered by this prospectus from time to time on any stock exchange or automated inter-dealer quotation system on which the securities are listed, in the over-the-counter market, in privately negotiated transactions or otherwise, at fixed prices that may be changed, at market prices prevailing at the time of sale, at prices related to prevailing market prices or at prices otherwise negotiated. The selling security holders may sell the securities by one or more of the following methods, without limitation:

• block trades in which the broker or dealer will attempt to sell the securities as agent but may position and resell a portion of the block as principal to facilitate the transaction;

• purchases by a broker or dealer as principal and resale by the broker or dealer for its own account pursuant to this prospectus;

• an exchange distribution in accordance with the rules of any stock exchange on which the securities are listed;

• ordinary brokerage transactions and transactions in which the broker solicits purchases;

• privately negotiated transactions;

• short sales, either directly or with a broker-dealer or affiliate thereof;

• through the writing of options on the securities, whether or not the options are listed on an options exchange;

• through loans or pledges of the securities to a broker-dealer or an affiliate thereof;

• by entering into transactions with third parties who may (or may cause others to) issue securities convertible or exchangeable into, or the return of which is derived in whole or in part from the value of, our common stock;

• through the distribution of the securities by any selling security holder to its partners, members or security holders;

• one or more underwritten offerings on a firm commitment or best efforts basis;

• any combination of any of these methods of sale; and

• any other method permitted pursuant to applicable law.

In addition to selling their securities covered by this prospectus, the selling security holders may transfer their securities in other ways not involving market makers or established trading markets, including directly by gift, distribution or other transfer; or sell their securities under Rule 144 of the Securities Act rather than under this prospectus, if the transaction meets the requirements of Rule 144. We do not know of any arrangements by the selling security holders for the sale of any of the securities.

For example, the selling security holders may engage brokers and dealers, and any brokers or dealers may arrange for other brokers or dealers to participate in effecting sales of the securities. These brokers, dealers or

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underwriters may act as principals, or as an agent of a selling security holder. Broker-dealers may agree with a selling security holder to sell a specified number of the securities at a stipulated price per security. If the broker-dealer is unable to sell securities acting as agent for a selling security holder, it may purchase as principal any unsold securities at the stipulated price. Broker-dealers who acquire securities as principals may thereafter resell the securities from time to time in transactions on any stock exchange or automated inter-dealer quotation system on which the securities are then listed, at prices and on terms then prevailing at the time of sale, at prices related to the then-current market price or in negotiated transactions. Broker-dealers may use block transactions and sales to and through broker-dealers, including transactions of the nature described above.

The selling security holders may authorize agents, underwriters or dealers to solicit offers by certain specified institutions to purchase securities from them at the public offering price set forth in a prospectus supplement under delayed delivery contracts providing for payment and delivery on a specified date in the future. These contracts would be subject only to those conditions set forth in the prospectus supplement, and the prospectus supplement would indicate the commission to be paid to underwriters, dealers and agents soliciting purchases of the securities pursuant to contracts accepted by us.

From time to time, one or more of the selling security holders may pledge, hypothecate or grant a security interest in some or all of the securities owned by them. The pledgees, secured parties or persons to whom the securities have been hypothecated will, upon foreclosure in the event of default, be deemed to be selling security holders. As and when a selling security holder takes such actions, the number of securities offered under this prospectus on behalf of such selling security holder will decrease. The plan of distribution for that selling security holder’s securities will otherwise remain unchanged.

A selling security holder may, from time to time, sell the securities short, and, in those instances, this prospectus may be delivered in connection with the short sales and the securities offered under this prospectus may be used to cover short sales. A selling security holder may enter into hedging transactions with broker-dealers and the broker-dealers may engage in short sales of the securities in the course of hedging the positions they assume with that selling security holder, including, without limitation, in connection with distributions of the securities by those broker-dealers. A selling security holder may enter into option or other transactions with broker-dealers that involve the delivery of the securities offered hereby to the broker-dealers, who may then resell or otherwise transfer those securities. A selling security holder may also loan the securities offered hereby to a broker-dealer and the broker-dealer may sell the loaned securities pursuant to this prospectus.

A selling security holder may enter into derivative transactions with third parties, or sell securities not covered by this prospectus to third parties in privately negotiated transactions. If the applicable prospectus supplement indicates, in connection with those derivatives, the third parties may sell securities covered by this prospectus and the applicable prospectus supplement, including in short sale transactions. If so, the third-party may use securities pledged by the selling security holder or borrowed from the selling security holder or others to settle those sales or to close out any related open borrowings of stock, and may use securities received from the selling security holder in settlement of those derivatives to close out any related open borrowings of stock. The third-party in such sale transactions will be an underwriter and, if not identified in this prospectus, will be identified in the applicable prospectus supplement (or a post-effective amendment to the registration statement of which this prospectus forms a part).

To the extent required under the Securities Act, the aggregate amount of selling security holders’ securities being offered and the terms of the offering, the names of any agents, brokers, dealers or underwriters and any applicable commission with respect to a particular offer will be set forth in an accompanying prospectus supplement. Any underwriters, dealers, brokers or agents participating in the distribution of the securities may receive compensation in the form of underwriting discounts, concessions, commissions or fees from a selling security holder and/or purchasers of selling security holders’ securities for whom they may act (which compensation as to a particular broker-dealer might be in excess of customary commissions). Agents, underwriters and dealers may be entitled under relevant agreements with us or the selling security holders to

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indemnification by us or the selling security holders against certain liabilities, including liabilities under the Securities Act, or to any contribution with respect to payments which such agents, underwriters and dealers may be required to make.

The selling security holders and any underwriters, brokers, dealers or agents that participate in the distribution of the securities may be deemed to be “underwriters” within the meaning of the Securities Act, and any discounts, concessions, commissions or fees received by them and any profit on the resale of the securities sold by them may be deemed to be underwriting discounts and commissions. Selling security holders who are “underwriters” within the meaning of the Securities Act will be subject to the prospectus delivery requirements of the Securities Act. Agents, underwriters and dealers may be customers of, engage in transactions with, or perform services for, us and our subsidiaries in the ordinary course of business.

The selling security holders and other persons participating in the sale or distribution of the securities will be subject to applicable provisions of the Exchange Act and the rules and regulations thereunder, including Regulation M. This regulation may limit the timing of purchases and sales of any of the securities by the selling security holders and any other person. The anti-manipulation rules under the Exchange Act may apply to sales of securities in the market and to the activities of the selling security holders and their affiliates. Furthermore, Regulation M may restrict the ability of any person engaged in the distribution of the securities to engage in market-making activities with respect to the particular securities being distributed for a period of up to five business days before the distribution. These restrictions may affect the marketability of the securities and the ability of any person or entity to engage in market-making activities with respect to the securities. The selling security holders will act independently of us in making decisions with respect to the timing, manner and size of each sale by them. The selling security holders may sell the securities covered by this prospectus on any stock exchange or automated inter-dealer quotation system on which the securities are listed, in the over-the-counter market or in private transactions, at market prices prevailing at the time of sale, at prices relating to the prevailing market prices or at negotiated prices.

In connection with an offering of securities, underwriters may purchase and sell the securities in the open market. These transactions may include over-allotment, syndicate covering transactions and stabilizing transactions. An over-allotment involves syndicate sales of securities in excess of the number of securities to be purchased by the underwriters in the offering, which creates a syndicate short position. Syndicate covering transactions involve purchases of securities in the open market after the distribution has been completed in order to cover syndicate short positions. Stabilizing transactions consist of some bids or purchases of securities made for the purpose of preventing or slowing a decline in the market price of the securities while the offering is in progress. In addition, the underwriters may impose penalty bids. A penalty bid is an arrangement permitting the representatives to reclaim the selling concession otherwise accruing to an underwriter or syndicate member in connection with an offering if the securities originally sold by that underwriter or syndicate member is purchased in a syndicate covering transaction and has therefore not been effectively placed by that underwriter or syndicate member.

Similar to other purchase transactions, these activities may have the effect of raising or maintaining the market price of the securities or preventing or slowing a decline in the market price of the securities. As a result, the price of the securities may be higher than the price that might otherwise exist in the open market. In addition, a penalty bid may discourage the immediate resale of securities sold in an offering of a selling security holder. The selling security holders do not make any representation or prediction as to the direction or magnitude of any effect that the transactions described above may have on the price of the securities. In addition, the selling security holders do not make any representation that the underwriters will engage in these transactions or that these transactions, once commenced, will not be discontinued without notice.

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LEGAL MATTERS

The validity of the securities offered by this prospectus will be passed upon for us by Latham & Watkins LLP, San Diego, California.

EXPERTS

The consolidated financial statements and schedule of Ligand Pharmaceuticals Incorporated as of December 31, 2007 incorporated by reference in the Prospectus constituting a part of this S-3 registration statement have been audited by BDO Seidman, LLP, an independent registered public accounting firm, to the extent and for the periods set forth in their report incorporated herein by reference, and are included in reliance upon such report given upon the authority of said firm as experts in auditing and accounting.

On April 1, 2008, the Audit Committee of the Board of Directors of Ligand dismissed BDO Seidman, LLP as its independent registered public accounting firm, effective immediately. The consolidated financial statements and schedule and management’s report on the effectiveness of internal control over financial reporting of Ligand Pharmaceuticals Incorporated as of December 31, 2008 incorporated by reference in the Prospectus constituting a part of this S-3 registration statement have been audited by Grant Thornton LLP, an independent registered public accounting firm, to the extent and for the period set forth in their reports incorporated herein by reference, and are included in reliance upon such reports given upon the authority of said firm as experts in auditing and accounting.

DISCLOSURE OF COMMISSION POSITION ON

INDEMNIFICATION FOR SECURITIES ACT LIABILITIES

Our certificate of incorporation and bylaws provide that we will indemnify our directors and officers, and may indemnify our employees and other agents, to the fullest extent not prohibited by the Delaware General Corporation Law. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons pursuant to the foregoing provisions, or otherwise, we have been advised that, in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

WHERE YOU CAN FIND MORE INFORMATION

We file annual, quarterly and current reports, proxy statements and other information with the SEC. You may read and copy any reports, statements or other information that we file at the SEC’s public reference room at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room. Our public filings are also available in electronic format to the public from commercial document retrieval services and at the Internet Web site maintained by the SEC at http://www.sec.gov. You can also review our SEC filings on our web site at http://www.ligand.com. Information included on our web site is not a part of this prospectus.

We have filed a registration statement and related exhibits on Form S-3 with the SEC. You should rely only on the information contained in this prospectus or on information to which we have incorporated by reference into this prospectus. This prospectus is a part of such registration statement. This prospectus does not contain all of the information set forth in the registration statement because certain parts of the registration statement are omitted as provided by the rules and regulations of the SEC. You may inspect and copy the registration statement at the SEC’s reference room or web addresses listed above.

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INCORPORATION BY REFERENCE

The SEC allows us to “incorporate by reference” information into this prospectus, which means that we can disclose important information to you by referring you to another document filed separately with the SEC. The information incorporated by reference is deemed to be part of this prospectus, except for any information superseded by information contained directly in this prospectus. This prospectus incorporates by reference the documents described below that we have previously filed with the SEC, as well as the annexes to this prospectus. These documents contain important information about Ligand and its financial condition.

The following documents listed below that we have previously filed with the SEC are incorporated by reference:

• the description of our common stock contained in our registration statement on Form 8-A filed on November 21, 1994, and any amendment or report filed for the purpose of updating such description;

• the description of our preferred shares purchase rights contained in our registration statement on Form 8-A filed on October 17, 2006, and any amendment or report filed for the purpose of updating such description;

• our definitive proxy statement on Schedule 14A filed with the SEC on April 29, 2009;

• our annual report on Form 10-K for the fiscal year ended December 31, 2008 filed with the SEC on March 16, 2009;

• our quarterly report on Form 10-Q for the fiscal quarter ended March 31, 2009 filed with the SEC on May 11, 2009;

• our current reports on Form 8-K filed with the SEC on January 26, 2009, February 6, 2009, February 18, 2009, February 20, 2009, February 25, 2009, March 27, 2009 and April 22, 2009; and

• all documents filed by us with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this prospectus and prior to the termination of this offering of securities.

Any statement incorporated herein shall be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this prospectus.

You may request a free copy of any of the documents incorporated by reference in this prospectus by writing to us or telephoning us at the address and telephone number set forth below.

Ligand Pharmaceuticals Incorporated

Attention: Investor Relations

10275 Science Center Drive

San Diego, California 92121

Telephone: (858) 550-7500

Ligand Pharmaceuticals Incorporated’s trademarks, trade names and service marks referenced in this prospectus include Ligand. All other trademarks, trade names or service marks are owned by their respective owners.

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PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. Other Expenses of Issuance and Distribution.

The following table sets forth our best estimate as to our anticipated costs and expenses expected to be paid by us in connection with a distribution of securities registered hereby. All amounts are estimates except for the SEC registration fee:

SEC registration fee	$	418.39
Legal fees and expenses		35,000.00
Accounting fees and expenses		10,000.00
Miscellaneous		2,000.00
Total	$	47,418.39

ITEM 15. Indemnification of Directors and Officers.

As permitted by Section 102 of the Delaware General Corporation Law, we have adopted provisions in our certificate of incorporation and Bylaws that limit or eliminate the personal liability of our directors for a breach of their fiduciary duty of care as a director. The duty of care generally requires that, when acting on behalf of the corporation, directors exercise an informed business judgment based on all material information reasonably available to them. Consequently, a director will not be personally liable to us or our stockholders for monetary damages or breach of fiduciary duty as a director, except for liability for: any breach of the director’s duty of loyalty to us or our stockholders; any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law; any act related to unlawful stock repurchases, redemptions or other distributions or payment of dividends; or any transaction from which the director derived an improper personal benefit.

These limitations of liability do not affect the availability of equitable remedies such as injunctive relief or rescission. As permitted by Section 145 of the Delaware General Corporation Law, the certificates of incorporation and Bylaws provide that we may indemnify our directors, officers, employees and agents to the fullest extent permitted by the Delaware General Corporation Law, subject to limited exceptions; we may advance expenses to our directors and officers in connection with a legal proceeding to the fullest extent permitted by the Delaware General Corporation Law, subject to limited exceptions; and the rights provided in the certificates of incorporation and Bylaws are not exclusive.

In addition, we have entered into separate indemnification agreements with our directors and officers which may be broader than the specific indemnification provisions contained in the Delaware General Corporation Law. These indemnification agreements may require us, among other things, to indemnify our officers and directors against liabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct. These indemnification agreements also may require us to advance any expenses incurred by the directors or officers as a result of any proceeding against them as to which they could be indemnified. In addition, we have purchased a policy of directors’ and officers’ liability insurance that insures our directors and officers against the cost of defense, settlement or payment of a judgment in some circumstances. These indemnification provisions and the indemnification agreements may be sufficiently broad to permit indemnification of our officers and directors for liabilities, including reimbursement of expenses incurred, arising under the Securities Act.

In addition, Pharmacopeia, a wholly owned subsidiary of ours, maintains and honors all indemnification arrangements in place for all past and present directors, officers, employees and agents of Pharmacopeia, Inc. as of the date of the merger agreement for acts or omissions occurring at or prior to the effective time of the merger of Margaux Acquisition Corp., a wholly owned subsidiary of Ligand, with and into Pharmacopeia, Inc.

II-1

Pharmacopeia will also indemnify and hold harmless such persons to the fullest extent permitted by applicable Delaware law for acts or omissions occurring in connection with the approval of the merger agreement and the consummation of the transactions contemplated thereby. The organizational documents of Pharmacopeia contain provisions with respect to exculpation and indemnification that are at least as favorable to the past and present indemnified directors, officers, employees and agents of Pharmacopeia as those contained in Pharmacopeia’s certificate of incorporation and bylaws as in effect on the date of the merger agreement. Such provisions will not be amended, repealed or otherwise modified for six years from the effective time of the merger of Margaux Acquisition Corp. with and into Pharmacopeia, Inc. in any manner that would adversely affect the rights thereunder of such indemnified persons.

Subject to certain exceptions, Ligand also maintains a directors’ and officers’ insurance and indemnification policy which covers those persons who are covered by Pharmacopeia’s directors’ and officers’ insurance and indemnification policy as of the date of the merger agreement for events occurring prior to the effective time of the merger of Margaux Acquisition Corp. with and into Pharmacopeia on terms no less favorable than those applicable to the current directors and officers of Pharmacopeia for six years; provided that the Pharmacopeia shall not be obligated to make aggregate annual premium payments which exceed 250% of the annual premium payments on Pharmacopeia’s current policy in effect as of the date of the merger agreement.

ITEM 16. Exhibits.

Exhibit Number	Exhibit Description
2.1	Agreement and Plan of Merger, dated as of September 24, 2008, by and among Ligand Pharmaceuticals Incorporated, Pharmacopeia, Inc., Margaux Acquisition Corp. and Latour Acquisition, LLC (included as Annex A to the proxy statement/prospectus filed with the SEC on November 17, 2008).
4.1	Specimen stock certificate for shares of common stock of Ligand Pharmaceuticals Incorporated (incorporated by reference to Exhibit 4.1 of Ligand Pharmaceuticals Incorporated’s registration statement on Form S-1 (No. 33-47257) filed with the SEC on April 16, 1992, as amended).
4.2	2006 Preferred Shares Rights Agreement, dated as of October 13, 2006, by and between Ligand Pharmaceuticals Incorporated and Mellon Investor Services LLC (incorporated by reference to Exhibit 4.1 of Ligand Pharmaceuticals Incorporated’s Current Report on Form 8-K filed with the SEC on October 17, 2006).
4.3(1)	Pharmacopeia, Inc. 2004 Stock Incentive Plan.
4.4(2)	Pharmacopeia, Inc. 2000 Stock Option Plan (incorporated by reference to Exhibit 10.323 of our Annual Report on Form 10-K for the year ended December 31, 2008, filed with the SEC on March 16, 2009).
4.5(3)	Form of Warrant.
5.1	Opinion of Latham & Watkins LLP regarding the legality of the securities being registered.
23.1	Consent of BDO Seidman, LLP, independent registered public accounting firm.
23.2	Consent of Grant Thornton LLP, independent registered public accounting firm.
23.3	Consent of Latham & Watkins LLP (included in Exhibit 5.1).
24.1	Powers of Attorney (included with the signature pages to this registration statement).

(1) Pursuant to resolutions adopted by the board of directors of Pharmacopeia, Inc., effective immediately prior to the effective time of the merger between Ligand and Pharmacopeia, the Pharmacopeia, Inc. 2004 Stock Incentive Plan was terminated with respect to the grant of any additional awards thereunder.

II-2

(2) Pursuant to resolutions adopted by the board of directors of Pharmacopeia, Inc., effective immediately prior to the effective time of the merger between Ligand and Pharmacopeia, the Pharmacopeia, Inc. 2000 Stock Option Plan was terminated with respect to the grant of any additional awards thereunder.

(3) Following the effective date of the merger between Ligand and Pharmacopeia, in lieu of shares of Pharmacopeia common stock, upon the payment of the applicable exercise price, each warrant shall instead be exercisable for the applicable per share merger consideration which would have been received by the holder if the warrant had been exercised immediately prior to the effective date of the merger.

ITEM 17. Undertakings.

We hereby undertake:

1. To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

(i) to include any prospectus required by Section 10(a)(3) of the Securities Act;

(ii) to reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in the volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and

(iii) to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;

provided, however, that paragraphs (1)(i), (1)(ii) and (1)(iii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the SEC by us pursuant to Section 13 or 15(d) of the Exchange Act that are incorporated by reference in the registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement.

2. That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

3. To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

4. That, for the purpose of determining liability under the Securities Act to any purchaser:

(i) each prospectus filed by us pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and

(ii) each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii) or (x) for the purpose of providing the information required by Section 10(a) of the Securities Act shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability

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purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration statement or a prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date.

5. That, for the purpose of determining our liability under the Securities Act to any purchaser in the initial distribution of the securities, we undertake that in a primary offering of our securities pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, we will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

(i) any preliminary prospectus or prospectus of ours relating to the offering required to be filed pursuant to Rule 424;

(ii) any free writing prospectus relating to the offering prepared by or on behalf of us or used or referred to by us;

(iii) the portion of any other free writing prospectus relating to the offering containing material information about us or our securities provided by or on behalf of us; and

(iv) any other communication that is an offer in the offering made by us to the purchaser.

We hereby undertake that, for purposes of determining any liability under the Securities Act, each filing of our annual report pursuant to Section 13(a) or 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

If and when applicable, we hereby undertake to supplement the prospectus, after the expiration of the subscription period, to set forth the results of the subscription offer, the transactions by the underwriters during the subscription period, the amount of unsubscribed securities to be purchased by the underwriters, and the terms of any subsequent reoffering thereof. If any public offering by the underwriters is to be made on terms differing from those set forth on the cover page of the prospectus, a post-effective amendment will be filed to set forth the terms of such offering.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers and controlling persons pursuant to the foregoing provisions, or otherwise, we have been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by us of expenses incurred or paid by one of our directors, officers or controlling persons in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question of whether such indemnification by us is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

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SIGNATURES

Pursuant to the requirements of the Securities Act, Ligand Pharmaceuticals Incorporated certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the city of San Diego, State of California, on May 20, 2009.

LIGAND PHARMACEUTICALS INCORPORATED
By:	/s/    JOHN L. HIGGINS
	John L. Higgins
	Chief Executive Officer, President and Director

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints John L. Higgins and Charles S. Berkman and each of them, and any successor or successors to such offices held by each of them, acting individually, as such person’s true and lawful attorneys-in-fact and agents, each with full power of substitution and resubstitution, for such person in his name or her name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as such person might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitutes, may do or cause to be done by virtue thereof. This power of attorney may be executed in counterparts.

Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

Signature	Title	Date
/s/    JOHN L. HIGGINS         John L. Higgins	President, Chief Executive Officer and Director (Principal Executive Officer)	May 20, 2009
/s/    JOHN P. SHARP         John P. Sharp	Vice President, Finance and Chief Financial Officer (Principal Financial and Accounting Officer)	May 20, 2009
/s/    JASON M. ARYEH         Jason M. Aryeh	Director	May 20, 2009
/s/    STEVEN J. BURAKOFF         Steven J. Burakoff	Director	May 20, 2009
/s/    TODD C. DAVIS         Todd C. Davis	Director	May 20, 2009
/s/    DAVID M. KNOTT         David M. Knott	Director	May 20, 2009

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Signature	Title	Date
/s/    JOHN W. KOZARICH         John W. Kozarich	Director	May 20, 2009
/s/    BRUCE A. PEACOCK         Bruce A. Peacock	Director	May 20, 2009
/s/    STEPHEN L. SABBA         Stephen L. Sabba	Director	May 20, 2009

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INDEX TO EXHIBITS

Exhibit Number	Exhibit Description
2.1	Agreement and Plan of Merger, dated as of September 24, 2008, by and among Ligand Pharmaceuticals Incorporated, Pharmacopeia, Inc., Margaux Acquisition Corp. and Latour Acquisition, LLC (included as Annex A to the proxy statement/prospectus on Form S-4 filed with the SEC on November 17, 2008).
4.1	Specimen stock certificate for shares of common stock of Ligand Pharmaceuticals Incorporated (incorporated by reference to Exhibit 4.1 of Ligand Pharmaceuticals Incorporated’s registration statement on Form S-1 (No. 33-47257) filed with the SEC on April 16, 1992, as amended).
4.2	2006 Preferred Shares Rights Agreement, dated as of October 13, 2006, by and between Ligand Pharmaceuticals Incorporated and Mellon Investor Services LLC (incorporated by reference to Exhibit 4.1 of Ligand Pharmaceuticals Incorporated’s Current Report on Form 8-K filed with the SEC on October 17, 2006).
4.3(1)	Pharmacopeia, Inc. 2004 Stock Incentive Plan.
4.4(2)	Pharmacopeia, Inc. 2000 Stock Option Plan (incorporated by reference to Exhibit 10.323 of our Annual Report on Form 10-K for the year ended December 31, 2008, filed with the SEC on March 16, 2009).
4.5(3)	Form of Warrant.
5.1	Opinion of Latham & Watkins LLP regarding the legality of the securities being registered.
23.1	Consent of BDO Seidman, LLP, independent registered public accounting firm.
23.2	Consent of Grant Thornton LLP, independent registered public accounting firm.
23.3	Consent of Latham & Watkins LLP (included in Exhibit 5.1).
24.1	Powers of Attorney (included with the signature pages to this registration statement).

(1) Pursuant to resolutions adopted by the board of directors of Pharmacopeia, Inc., effective immediately prior to the effective time of the merger between Ligand and Pharmacopeia, the Pharmacopeia, Inc. 2004 Stock Incentive Plan was terminated with respect to the grant of any additional awards thereunder.

(2) Pursuant to resolutions adopted by the board of directors of Pharmacopeia, Inc., effective immediately prior to the effective time of the merger between Ligand and Pharmacopeia, the Pharmacopeia, Inc. 2000 Stock Option Plan was terminated with respect to the grant of any additional awards thereunder.

(3) Following the effective date of the merger between Ligand and Pharmacopeia, in lieu of shares of Pharmacopeia common stock, upon the payment of the applicable exercise price, each warrant shall instead be exercisable for the applicable per share merger consideration which would have been received by the holder if the warrant had been exercised immediately prior to the effective date of the merger.

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EX-4.3

Exhibit 4.3

PHARMACOPEIA DRUG DISCOVERY, INC.

AMENDED AND RESTATED 2004 STOCK INCENTIVE PLAN

Effective April 6, 2004

Effective as Amended and Restated May , 2007

ARTICLE 1

PURPOSE AND TERM OF PLAN

1.1. Purpose. The purpose of the Plan is to provide motivation to selected Employees, Directors and Consultants to put forth maximum efforts toward the continued growth, profitability, and success of the Company by providing incentives to such Employees, Directors and Consultants through the ownership and performance of Common Stock.

1.2. Term. The Plan was originally approved by the Board on March 16, 2004, and became effective upon the date of the approval by Pharmacopeia’s stockholders. This amendment and restatement was approved by the Board on                     , 2007 and becomes effective on the date of the approval by the Company’s stockholders. The Plan and any Awards granted thereunder shall be null and void if stockholder approval is not obtained.

ARTICLE 2

DEFINITIONS

In any necessary construction of a provision of this Plan, the masculine gender may include the feminine, and the singular may include the plural, and vice versa.

2.1. “Affiliate” means any entity other than the Subsidiaries in which the Company has a substantial direct or indirect equity interest, as determined by the Board.

2.2. “Approved Reason” means a reason for terminating employment with the Company, which, in the opinion of the Committee, is in the best interests of the Company. The Committee must specifically designate that a Participant has been terminated for an Approved Reason. Absent such determination by the Committee, a Participant cannot be found to have terminated for an Approved Reason.

2.3. “Award” means any form of Option, SAR, Stock Award, performance unit, performance share, or Performance Award, whether singly, in combination, or in tandem, to a Participant by the Committee pursuant to such terms, conditions, restrictions and/or limitations, if any, as the Committee may establish by the Award Notice or otherwise.

2.4. “Award Notice” means the written document establishing the terms, conditions, restrictions, and/or limitations of an Award in addition to those established by this Plan and by the Committee’s exercise of its administrative powers. The Committee will establish the form of the written document in the exercise of its sole and absolute discretion.

2.5. “Board” means the Board of Directors of the Company.

2.6. “Calendar Year Subaccount” means a notional bookkeeping account to which all of a Participant’s deferred Awards are credited.

2.7. “Cause” means, unless otherwise provided in an employment, change in control, severance or similar agreement between a Participant and the Company or in an Award Notice: (a) any gross failure by the Participant (other than by reason of Disability) to faithfully and professionally carry out his or her duties or to comply with any other material provision of his or her employment agreement, if any, which continues for thirty days after written notice by the Company; provided, that the Company does not have to provide notice in the event that the failure is not susceptible to remedy or relates to the same type of acts or omissions as to which notice has been given on a prior occasion; (b) the Participant’s dishonesty or other willful misconduct; (c) the Participant’s conviction of any felony or of any other crime involving moral turpitude, whether or not relating to his or her employment; (d) the Participant’s insobriety or use of drugs, chemicals or controlled substances either in the course of performing his or her duties and responsibilities under his or her employment agreement or otherwise affecting the ability of Participant to perform those duties and responsibilities; (e) the Participant’s failure to comply with a lawful written direction of the Company; (f) any wanton or willful dereliction of duties by the Participant; or (g) breach of the Company’s Code of Ethics or insider trading policies.

2.8. “CEO” means the Chief Executive Officer of the Company.

2.9. “Change In Control” means: (i) any “person” (within the meaning of Section 13(d) or 14(d) of the Exchange Act, including a “group” within the meaning of Section 13(d) but excluding the Company and any of its Subsidiaries or Affiliates and any employee benefit plan sponsored or maintained by the Company or any subsidiary thereof), shall become the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing thirty percent (30%) or more of the combined voting power of the then outstanding securities entitled to vote generally in the election of directors (“Voting Securities”) of the Company (the “Company Voting Securities”); or (ii) the consummation of a merger, consolidation, reorganization or any other business combination (any of the foregoing, a “Business Combination”) of or involving the Company and another person or persons where the persons who were the beneficial owners of Company Voting Securities outstanding immediately prior to such Business Combination do not beneficially own, directly or indirectly, immediately after such transaction, securities representing fifty percent (50%) or more of the combined voting power of the then outstanding Company Voting Securities or Voting Securities of the entity acquiring the Company in such Business Combination; (iii) shareholder approval of a complete liquidation or dissolution of the Company; or (iv) a sale, lease, exchange or other disposition or transfer (in one transaction or a series of related transactions) of all or substantially all of the assets or business of the Company; provided, that a change in control under this clause shall not be deemed to have occurred where (x) the Company sells, exchanges or otherwise disposes of or transfers all or substantially all of its assets or business to another corporation which is beneficially owned, directly or indirectly, immediately following such transaction by the holders of Company Voting Securities in substantially the same proportions as their ownership of Company Voting Securities immediately prior to such transaction and (y) such corporation assumes the Plan; or (v) during any period of two consecutive years, the Continuing Directors (as defined below) cease for any reason to constitute at least a majority of the Board (or, if applicable, of a successor to the Company), where the term “Continuing Director” means at any date a director of the Company who was (x) a director at the beginning of such period or (y) nominated or elected subsequent to such date by at least a majority of the directors who were Continuing Directors at the time of such nomination or election or whose election to the board was recommended or endorsed by at least a majority of the directors who were Continuing Directors at the time of such nomination or election (it being understood that no individual whose initial assumption of office occurred as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a person other than the board shall be a Continuing Director).

2.10. “Code” means the Internal Revenue Code of 1986, as amended from time to time, including regulations thereunder and successor provisions and regulations thereto.

2.11. “Committe” means the Board or the committee designated by the Board to administer the Plan under Article 4. The Committee shall have at least two members, each of whom shall be a “non-employee director” as defined in Rule 16b-3 under the Exchange Act and an “outside director” as defined in Section 162(m) of the Code and the regulations thereunder, and, if applicable meet the independence requirements of the applicable stock exchange, quotation system or other self-regulatory organization on which the Common Stock is traded. Notwithstanding the foregoing, the Board may designate one or more of its members to serve as a Secondary Committee and delegate to the Secondary Committee authority to grant Awards to eligible individuals who are not subject to the requirements of Rule 16b-3 under the Exchange Act or Section 162(m) of the Code and the regulations thereunder. The Secondary Committee shall have the same authority with respect to selecting the individuals to whom such Awards are granted and establishing the terms and conditions of such Awards as the Committee has under the terms of the Plan.

2.12. “Common Stock” means the common stock, $0.01 par value per share, of the Company that may be newly issued or treasury stock.

2.13. “Company” means with respect to Employees and consultants, Pharmacopeia and its Subsidiaries and Affiliates provided, however, that with respect to Directors, Company shall only mean Pharmacopeia.

2.14. “Consultants” means the consultants, advisors and independent contractors retained by the Company.

2.15. “Covered Employee” means an Employee who is a “Covered Employee” within the meaning of Section 162(m) of the Code.

2.16. “Director” means a non-Employee member of the Board.

2.17. “Disability” means a physical or mental impairment that satisfies the definition of disability under Section 22(e)(3) of the Code.

2.18. “Effective Date” means the date an Award is determined to be effective by the Committee upon its grant of such Award, which date shall be set forth in the applicable Award Notice.

2.19. “Employee” means any person employed by the Company on a full or part-time basis.

2.20. “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, including rules thereunder and successor provisions and rules thereto.

2.21. “Fair Market Value” means on any given date:

(a) if the Common Stock is listed on an established stock exchange or exchanges, the closing price of Common Stock on the principal exchange on which it is traded on such date, or if no sale was made on such date on such principal exchange, on the last preceding day on which the Common Stock was traded;

(b) if the Common Stock is not then listed on an exchange, but is quoted on NASDAQ or a similar quotation system, the closing price per share for the Common Stock as quoted on NASDAQ or similar quotation system on such date;

(c) if the Common Stock is not then listed on an exchange or quoted on NASDAQ or a similar quotation system, the value, as determined in good faith by the Committee and in accordance with applicable provisions of the Code or regulations and rulings thereunder.

2.22. “Incentive Stock Option” means an Option which meets the requirements of Section 422 of the Code and which is designated as an Incentive Stock Option by the Committee.

2.23. “Negative Discretion” means the discretion authorized by the Plan to be applied by the Committee in determining the size of an Award for a Performance Period if, in the Committee’s sole judgment, such application is appropriate. Negative Discretion may only be used by the Committee to eliminate or reduce the size of an Award. In no event shall any discretionary authority granted to the Committee by the Plan, including, but not limited to Negative Discretion, be used to: (a) grant Awards for a Performance Period if the Performance Goals for such Performance Period have not been attained under the applicable Performance Formula; or (b) increase an Award above the maximum amount payable under Section 6.3 of the Plan.

2.24. “Non-Qualified Stock Option” means an Option not intended to be an Incentive Stock Option, and designated as a Non-Qualified Stock Option by the Committee.

2.25. “Option” means the right, granted from time to time under the Plan, to purchase Common Stock for a specified period of time at a stated price. An Option may be an Incentive Stock Option or a Non-Qualified Stock Option.

2.26. “Participant” means either an Employee, Director or Consultant to whom an Award has been granted by the Committee under the Plan.

2.27. “Performance Awards” means the Stock Awards, performance units and performance shares granted to Covered Employees pursuant to Article 7. All Performance Awards are intended to qualify as “performance-based compensation” under Section 162(m) of the Code.

2.28. “Performance Criteria” means the one or more criteria that the Committee shall select for purposes of establishing the Performance Goal(s) for a Performance Period. The Performance Criteria that will be used to establish such Performance Goal(s) shall be limited to the following: revenue growth; earnings before interest, taxes, depreciation and amortization (EBITDA); operating income; net operating income after tax; pre- or after-tax income; cash flow; cash flow per share; net earnings; earnings per share; return on equity; return on capital employed; return on assets; economic value added (or an equivalent metric); share price performance; total shareholder return; improvement in or attainment of expense levels; improvement in or attainment of working capital levels; or debt reduction. To the extent required by Section 162(m) of the Code, the Committee shall, within the time period required by Section 162(m) of the Code (generally, the first 90 days of a Performance Period), define in an objective fashion the manner of calculating the Performance Criteria it selects to use for such Performance Period.

2.29. “Performance Formula” means, for a Performance Period, the one or more objective formulas (expressed as a percentage or otherwise) applied against the relevant Performance Goal(s) to determine, with regards to the Award of a particular Participant, whether all, some portion but less than all, or none of the Award has been earned for the Performance Period.

2.30. “Performance Goals” means, for a Performance Period, the one or more goals established by the Committee for the Performance Period based upon the Performance Criteria. Performance Goals may be based on the performance of the Company, any Subsidiary or any division or business unit within the Company or any Subsidiary, and if so desired by the Committee, by comparison with a peer group of companies. Unless otherwise stated, such Performance Goals, need not be based upon an increase or positive result and could include, for example, maintaining the status quo or limiting economic loss (measured, in each case, by reference to specific Performance Criteria.) The Committee is authorized at any time during the time period permitted by Section 162(m) of the Code (generally, the first 90 days of a Performance Period), or at any time thereafter, in its sole and absolute discretion, to adjust or modify the calculation of a Performance Goal for such Performance Period in order to prevent the dilution or enlargement of the rights of Participants, (a) in the event of, or in anticipation of, any unusual or extraordinary corporate item, transaction, event or development; (b) in recognition of, or in anticipation of, any other unusual or nonrecurring events affecting the Company, or the financial statements of the Company, or in response to, or in anticipation of, changes in applicable laws, regulations, accounting principles, or business conditions; and (c) in view of the Committee’s assessment of the business strategy of the Company, performance of comparable organizations, economic and business conditions, and any other circumstances deemed relevant.

2.31. “Performance Period” means the one or more periods of time (of at least 12 months), which may be of varying and overlapping durations, as the Committee may select, over which the attainment of one or more Performance Goals will be measured for the purpose of determining a Participant’s right to and the payment of a Performance Award.

2.32. “Pharmacopeia” means Pharmacopeia, Inc., a Delaware corporation, formerly known as Pharmacopeia Drug Discovery, Inc.

2.33. “Plan” means this Pharmacopeia, Inc. 2004 Stock Incentive Plan, as amended from time to time.

2.34. “Restricted Stock” means a Stock Award granted pursuant to Article 11 subject to the restrictions provided in the applicable Award Notice.

2.35. “Retirement” means, unless otherwise provided, a termination for other than Cause after attaining at least age 55 and completing at least 5 years of service with the Company.

2.36. “SAR”, or stock appreciation right, means the right to receive, in cash or in Common Stock, as determined by the Committee, the increase in the Fair Market Value of the Common Stock underlying the SAR from the date of grant to the date of exercise.

2.37. “Stock Award” means an award granted pursuant to Article 10 in the form of shares of Common Stock, Restricted Stock, and/or Units of Common Stock.

2.38. “Subsidiary” means any corporation (other than Pharmacopeia) in an unbroken chain of corporations beginning with Pharmacopeia (or any subsequent parent of Pharmacopeia) if each of the corporations other than the last corporation in the unbroken chain owns stock possessing 50 percent or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.

2.39. “Ten Percent Stockholder” means a person who on any given date owns, either directly or indirectly (taking into account the attribution rules contained in Section 424(d) of the Code), stock possessing more than 10 percent of the total combined voting power of all classes of stock of the Company or any Subsidiary.

2.40. “Unit” means a bookkeeping entry used by Company to record and account for the grant of the following Awards until such time as the Award is paid, canceled, forfeited or terminated, as the case may be: Units of Common Stock, performance units, and performance shares which are expressed in terms of Units of Common Stock.

ARTICLE 3

ELIGIBILITY

3.1. In General. Subject to Section 3.2, all Employees, Directors and Consultants are eligible to participate in the Plan. The Committee may select, from time to time, Participants from those Employees and who, in the opinion of the Committee, can further the Plan’s purposes. In addition, the Committee may select, from time to time, Participants from those Directors and Consultants (who may or may not be Committee members) who, in the opinion of the Committee, can further the Plan’s purposes. Once a Participant is so selected, the Committee shall determine the type(s) of Awards to be made to the Participant and shall establish in the related Award Notice(s) the terms, conditions, restrictions and/or limitations, if any, applicable to the Award(s) in addition to those set forth in this Plan and the administrative rules and regulations issued by the Committee.

3.2. Incentive Stock Options. Only Employees shall be eligible to receive “incentive stock options” (within the meaning of Section 422 of the Code).

ARTICLE 4

PLAN ADMINISTRATION

4.1. Members. Members of the Committee shall be appointed by and hold office at the pleasure of the Board. Committee members may resign at any time by delivering written notice to the Board. Vacancies in the Committee may be filled by the Board.

4.2. Responsibility. The Committee shall have total and exclusive responsibility to control, operate, manage and administer the Plan, in accordance with its terms.

4.3. Authority of the Committee. The Committee shall have all the authority that may be necessary or helpful to enable it to discharge its responsibilities with respect to the Plan. Without limiting the generality of the preceding sentence, the Committee shall have the exclusive right to: (a) select the Participants and determine the type of Awards to be made to Participants, the number of shares subject to Awards and the terms, conditions, restrictions and limitations of the Awards; (b) interpret the Plan; (c) determine eligibility for participation in the Plan; (d) decide all questions concerning eligibility for and the amount of Awards payable under the Plan; (e) construe any ambiguous provision of the Plan; (f) correct any default; (g) supply any omission; (h) reconcile any inconsistency; (i) issue administrative guidelines as an aid to administer the Plan and make changes in such guidelines as it from time to time deems proper; (j) make regulations for carrying out the Plan and make changes in such regulations as it from time to time deems proper; (k) determine whether Awards should be granted singly, in combination or in tandem; (l) to the extent permitted under the Plan, grant waivers of Plan terms, conditions, restrictions, and limitations, (m) accelerate the vesting, exercise, or payment of an Award or the performance period of an Award when such action or actions would be in the best interest of the Company; (n) subject to Section 17.3, grant Awards in replacement of Awards previously granted under this Plan or any other executive compensation plan of the Company; (o) establish; and administer the-Performance Goals and certify whether, and to what extent, they have been attained; (p) determine the terms and provisions of any agreements entered into hereunder; (q) take any and all other action it deems necessary or advisable for the proper operation or administration of the Plan; and (r) make all other determinations it deems necessary or advisable for the administration of the Plan, including factual determinations. Notwithstanding anything herein to the contrary and except as expressly provided by the adjustment provisions of Section 6.2, Options and SARs granted under the Plan shall not be directly or indirectly repriced, replaced or regranted through cancellation without shareholder approval, including, but not limited to, an exchange of an Option or SAR with an exercise price or base price less than Fair Market Value for cash, restricted stock, stock options or other stock awards.

4.4. Discretionary Authority. The Committee shall have full discretionary authority in all matters related to the discharge of its responsibilities and the exercise of its authority under the Plan including, without limitation, its construction of the terms of the Plan and its determination of eligibility for participation and Awards under the Plan. It is the intent of Plan that the decisions of the Committee and its actions with respect to the Plan shall be final, binding and conclusive upon all persons having or claiming to have any right or interest in or under the Plan.

4.5. Section 162(m) of the Code. With regards to all Covered Employees, the Plan shall, for all purposes, be interpreted and construed in accordance with Section 162(m) of the Code.

4.6. Action by the Committee. The Committee may act at a meeting only by a majority of its members. Any determination of the Committee may be made, without a meeting, by a writing or writings signed by all of the members of the Committee. In addition, the Committee may authorize any one or more of its number to execute and deliver documents on behalf of the Committee.

4.7. Allocation and Delegation of Authority. The Committee may allocate all or any portion of its responsibilities and powers under the Plan to any one or more of its members, the CEO or the Secondary Committee as the Committee deems appropriate and may delegate all or any part of its responsibilities and powers to any such person or persons, provided that any such allocation or delegation be in writing; provided, however, that only the Committee may select and grant Awards to Participants who are subject to Section 16 of the Exchange Act or are Covered Employees. The Committee may revoke any such allocation or delegation at any time for any reason with or without prior notice.

ARTICLE 5

FORM OF AWARDS

5.1. In General. Awards may, at the Committee’s sole discretion, be granted in the form of Performance Awards pursuant to Article 7, Options pursuant to Article 8, SARs pursuant to Article 9, Stock Awards pursuant to Article 10, performance units pursuant to Article 11, performance shares pursuant to Article 12, or a combination thereof. All Awards shall be subject to the terms, conditions, restrictions and limitations of the Plan. The Committee may, in its sole judgment, subject an Award at any time to such other terms, conditions, restrictions and/or limitations, (including, but not limited to, the time and conditions of exercise and restrictions on transferability and vesting), provided they are not inconsistent with the terms of the Plan. Awards under a particular Article of the Plan need not be uniform and Awards under two or more Articles may be combined into a single Award Notice. Any combination of Awards may be granted at one time and on more than one occasion to the same Participant.

5.2. Foreign Jurisdictions.

(a) Special Terms. In order to facilitate the making of any Award to Participants who are employed or retained by the Company outside the United States as Employees, Directors or Consultants (or who are foreign nationals temporarily within the United States), the Committee may provide for such modifications and additional terms and conditions (“special terms”) in Awards as the Committee may consider necessary or appropriate to accommodate differences in local law, policy or custom or to facilitate administration of the Plan. The special terms may provide that the grant of an Award is subject to (1) applicable governmental or, regulatory approval or other compliance with local legal requirements and/or (2) the execution by the Participant of a written instrument in the form specified by the Committee, and that in the event such conditions are not satisfied, the grant shall be void. The special terms may also provide that an Award shall become exercisable or redeemable, as the case may be, if an Employee’s employment or Director or Consultant’s relationship with the Company ends as a result of workforce reduction, realignment or similar measure and the Committee may designate a person or persons to make such determination for a location. The Committee may adopt or approve sub-plans, appendices or supplements to, or amendments, restatements, or alternative versions of, the Plan as it may consider necessary or appropriate for purposes of implementing any special terms, without thereby affecting the terms of the Plan as in effect for any other purpose; provided, however, no such sub-plans, appendices or supplements to, or amendments, restatements, or alternative versions of, the Plan shall: (a) increase the limitations contained in Section 6.3; (b) increase the number of available shares under Section 6.1; (c) cause the Plan to cease to satisfy any conditions of Rule 16b-3 under the Exchange Act or, with respect to Covered Employees whose compensation is subject to Section 162(m) of the Code, Section 162(m) of the Code; or (d) revoke, remove or reduce any vested right of a Participant without the prior written consent of such Participant.

(b) Currency Effects. Unless otherwise specifically determined by the Committee, all Awards and payments pursuant to such Awards shall be determined in U.S. currency. The Committee shall determine, in its discretion, whether and to the extent any payments made pursuant to an Award shall be made in local currency, as opposed to U.S. dollars. In the event payments are made in local currency, the Committee may determine, in its discretion and without liability to any Participant, the method and rate of converting the payment into local currency.

(c) Modifications to Awards. The Committee shall have the right at any time and from time to time and without prior notice to modify outstanding Awards to comply with or satisfy local laws and regulations or to avoid costly governmental filings. By means of illustration, but not limitation, the Committee may restrict the method of exercise of an Award to facilitate compliance with applicable securities laws or exchange control filings, laws or regulations.

(d) No Acquired Rights. No Employee in any country shall have any right to receive an Award, except as expressly provided for under the Plan. All Awards made at any time are subject to the prior approval of the Committee.

ARTICLE 6

SHARES SUBJECT TO PLAN

6.1. Available Shares. The maximum number of shares of Common Stock which shall be available for grant of Awards under the Plan (including Incentive Stock Options) during its term shall not exceed 3,400,000. All of the shares of Common Stock reserved hereunder may be issuable as Incentive Stock Options. Such amount shall be subject to adjustment as provided in Section 6.2. Any shares of Common Stock related to Awards which terminate by expiration, forfeiture, cancellation or otherwise without the issuance of such shares, are settled in cash in lieu of Common Stock, or are exchanged with the Committee’s permission for Awards not involving Common Stock, shall be available again for grant under the Plan. Moreover, if the exercise price of any Option or the tax withholding requirements with respect to any Option, Stock Award or performance share or performance unit award are satisfied by tendering shares of Common Stock to the Company (by either actual delivery or by attestation), only the number of shares of Common Stock issued net of the shares of Common Stock tendered or withheld will be deemed delivered for purposes of determining the maximum number of shares of Common Stock available for delivery under the Plan. The maximum number of shares available for issuance under the Plan shall not be reduced to reflect any dividends or dividend equivalents that are reinvested into additional shares, of Common Stock or credited as additional performance shares. The maximum number of shares of Common Stock shall not be reduced by the issuance of shares of Common Stock hereunder due to the assumption, conversion or substitution of awards made by an entity acquired by the Company. The shares of Common Stock available for issuance under the Plan may be authorized and unissued shares or treasury shares. For the purpose of computing the total number of shares of Common Stock granted under the Plan, where one or more types of Awards, both of which are payable in shares of Common Stock, are granted in tandem with each other, such that the exercise of one type of Award with respect to a number of shares cancels an equal number of shares of the other, the number of shares granted under both Awards shall be deemed to be equivalent to the number of shares under one of the Awards.

6.2. Adjustment to Shares. The provisions of this Section 6.2(a) are subject to the limitation contained in Section 6.2(b). If there is any change in the number of outstanding shares of Common Stock through the declaration of stock dividends, stock splits or the like, the number of shares available for Awards, the shares subject to any Award and the exercise prices of Awards shall be automatically adjusted. If there is any change in the number of outstanding shares of Common Stock through any change in the capital account of the Company, or through a merger, consolidation, separation (including a spin off or other distribution of stock or property), reorganization (whether or not such reorganization comes within the meaning of such term in Section 368(a) of the Code) or partial or complete liquidation, the Committee shall make appropriate adjustments in the maximum number of shares of Common Stock which may be issued under the Plan and any adjustments and/or modifications to outstanding Awards. In the event of any other change in the capital structure or in the Common Stock of the Company, the Committee shall also make such appropriate adjustments in the maximum number of shares of Common Stock available for issuance under the Plan and any adjustments and/or modifications to outstanding Awards as it, in its sole discretion, deems appropriate. The maximum number of shares available for issuance under the Plan shall be automatically adjusted to the extent necessary to reflect any dividend equivalents paid in the form of Common Stock. Subject to Section 6.2(b), if the maximum number of shares of Common Stock available for issuance under the Plan are adjusted pursuant to this Section 6.2(a), corresponding adjustments shall be made to the limitations set forth in Section 6.3.

6.3. Maximum Award Payable. Notwithstanding any provision contained in the Plan to the contrary, the maximum Award payable (or granted, if applicable) to any one Participant under the Plan for a calendar year is: (a) for Performance Awards, 200,000 shares of Common Stock or, in the event the Performance Award is paid in cash, $500,000; (b) for Options and SARs, 500,000 shares of Common Stock; (c) for Stock Awards (including Restricted Stock and those issued in the form of Performance Awards under Article 7), 200,000 shares of Common Stock.

ARTICLE 7

PERFORMANCE AWARDS

7.1. Purpose. For purposes of grants issued to Covered Employees, the provisions of this Article 7 shall apply in addition to and, where necessary, in lieu of the provisions of Article 10, Article 11 and Article 12. The purpose of this Article is to provide the Committee the ability to qualify the Stock Awards authorized under Article 10, the performance units under Article 11, and the performance shares under Article 12 as “Performance-Based Compensation” under Section 162(m) of the Code. To the extent applicable, the provisions of this Article 7 shall control over any contrary provision contained in Article 10, Article 11 or Article 12.

7.2. Eligibility. Only Covered Employees and Participants that are expected to become Covered Employees during an applicable Performance Period shall be eligible to receive Performance Awards. The Committee will, in its sole discretion, designate within the earlier of the (1) first 90 days of a Performance Period and (2) the lapse of 25% of the period of service to which the Performance Goals relate, which Covered Employees will be Participants for such period. However, designation of a Covered Employee as a Participant for a Performance Period shall not in any manner entitle the Participant to receive an Award for the period. The determination as to whether or not such Participant becomes entitled to an Award for such Performance Period shall be decided solely in accordance with the provisions of this Article 7. Moreover, designation of a Covered Employee as a Participant for a particular Performance Period shall not require designation of such Covered Employee as a Participant in any subsequent Performance Period and designation of one Covered Employee as a Participant shall not require designation of any other Covered Employee as a Participant in such period or in any other period.

7.3. Discretion of Committee with Respect to Performance Awards. With regards to a particular Performance Period, the Committee shall have full discretion to select the length of such Performance Period, the types of Performance Awards to be issued, the Performance Criteria that will be used to establish the Performance Goals, the kinds and/or levels of the Performance Goals, whether the Performance Goals are to apply to the Company or any one or more subunits thereof, and the Performance Formula. Within the earlier of (1) the first 90 days of a Performance Period and (2) the lapse of 25% of the period of service, and in any event while the outcome is substantially uncertain, the Committee shall, with regards to the Performance Awards to be issued for such Performance Period, exercise its discretion with respect to each of the matters enumerated in the immediately preceding sentence of this Section and record the same in writing.

7.4. Payment of Performance Awards.

(a) Condition to Receipt of Performance Award. Unless otherwise provided in the relevant Award Notice, a Participant must be employed by the Company on the last day of a Performance Period to be eligible for a Performance Award for such Performance Period.

(b) Limitation. A Participant shall be eligible to receive a Performance Award for a Performance Period only to the extent that: (1) the Performance Goals for such period are achieved; and (2) and the Performance Formula as applied against such Performance Goals determines that all or some portion of such Participant’s Performance Award has been earned for the Performance Period.

(c) Certification. Following the completion of a Performance Period, the Committee shall meet to review and certify in writing whether, and to what extent, the Performance Goals for the Performance Period have been achieved and, if so, to also calculate and certify in writing the amount of the Performance Awards earned for the period based upon the Performance Formula. The Committee shall then determine the actual size of each Participant’s Performance Award for the Performance Period and, in so doing, shall apply Negative Discretion, if and when it deems appropriate.

(d) Negative Discretion. In determining the actual size of an individual Performance Award for a Performance Period, the Committee may reduce or eliminate the amount of the Performance Award earned under the Performance Formula for the Performance Period through the use of Negative Discretion, if in its sole judgment, such reduction or elimination is appropriate.

(e) Timing of Award Payments. The Awards granted for a Performance Period shall be paid to Participants as soon as administratively practicable following completion of the certifications required by Section 7.4(c).

ARTICLE 8

STOCK OPTIONS

8.1. In General. Awards may be granted in the form of Options. These Options may be Incentive Stock Options, Non-Qualified Stock Options or a combination of both. All Awards under the Plan issued to Covered Employees in the form of Non-Qualified Stock Options shall qualify as “Performance-Based Compensation” under Section 162(m) of the Code.

8.2. Exercise Price. The price at which Common Stock may be purchased upon exercise of a Non-Qualified Stock Option shall be not less than 100% of the Fair Market Value of the Common Stock, as determined by the Committee, on the Effective Date of the option’s grant. Notwithstanding the forgoing, the exercise price of any Incentive Stock Option shall not be less than (i) 110% of the Fair Market Value on the Effective Date in the case of a grant to a Ten Percent Stockholder, or (ii) 100% of the Fair Market Value on the Effective Date in the case of a grant to any other Participant. Notwithstanding the two immediately preceding sentences, if the Company acquires another entity, the Company may substitute Options with exercise prices below the Fair Market Value requirements stated above for any options previously issued by such acquired company, to the extent permitted by Section 409A of the Code and/or Section 424 of the Code.

8.3. Restrictions Relating to Incentive Stock Options. Incentive Stock Options shall, in addition to being subject to the terms and conditions of Section 8.2, comply with Section 422 of the Code. Accordingly, the aggregate Fair Market Value (determined at the time the option was granted) of the Common Stock with respect to which Incentive Stock Options are exercisable for the first time by a Participant during any calendar year (under this Plan or any other plan of the Company) shall not exceed $100,000 (or such other limit as may be required by the Code). Incentive Stock Options must be issued within ten years from the effective date of the Plan, and the term of such Incentive Stock Options may not exceed ten years (or any shorter period required by Section 422 of the Code); provided, that the term of Incentive Stock Options issued to Ten Percent Stockholders may not exceed five years. Incentive Stock Options shall not be transferable other than by will or the laws of descent and distribution.

8.4. Additional Terms and Conditions. An Option shall be exercisable in accordance with such terms and conditions and at such times and during such periods as may be determined by the Committee; provided, that Non-Qualified Stock Options must be issued within ten years from the effective date of the Plan, and the term of such Non-Qualified Options may not exceed ten years. The Committee may, by way of the Award Notice or otherwise, establish such other terms, conditions, restrictions and/or limitations, including vesting and post-termination exercise period if any, of any Option, provided they are not inconsistent with the Plan.

8.5. Exercise of Option and Payment of Option Price. An Option may be exercised only for a whole number of shares of Common Stock. The Committee shall establish the time and the manner in which an Option may be exercised. The exercise price of the shares of Common Stock received upon the exercise of an Option shall be paid in a manner that will not result in an impermissible extension of credit under the Sarbanes-Oxley Act of 2002: (i) in cash, (ii) with the consent of the Committee in whole or in part in

shares of Common Stock held by the Participant (or to the extent permitted by the Committee, in Common Stock which the Participant would otherwise receive upon the exercise of such Option) and valued at their Fair Market Value on the date of exercise, (iii) in cash received from a broker-dealer whom the Participant has authorized to sell all or a portion of the Common Stock covered by the Option, or (iv) in such other manner deemed appropriate by the Committee.

ARTICLE 9

STOCK APPRECIATION RIGHTS

9.1. In General. Awards may be granted in the form of SARs. The “exercise price” for a particular SAR shall be defined in the Award Notice for that SAR An SAR may be granted in tandem with all or a portion of a related Option under the Plan (“Tandem SARs”), or may be granted separately (“Freestanding SARs”). A Tandem SAR may be granted either at the time of the grant of the related Option or at any time thereafter during the term of the Option. All Awards under the Plan issued to Covered Employees in the form of an SAR shall qualify as “Performance-Based Compensation” under Section 162(m) of the Code.

9.2. Terms and Conditions of Tandem SARs. A Tandem SAR shall be exercisable to the extent, and only to the extent, that the related Option is exercisable, and the “exercise price” of such an SAR (the base from which the value of the SAR is measured at its exercise) shall be the exercise price under the related Option. However, at no time shall a Tandem SAR be issued if the exercise price of its related Option is less than the Fair Market Value of the Common Stock, as determined by the Committee, on the Effective Date of the Tandem SAR’s grant. If an Option is exercised as to some or all of the shares covered by the Award, the related Tandem SAR, if any, shall be canceled automatically to the extent of the number of shares covered by the Option exercise. Upon exercise of a Tandem SAR as to some or all of the shares covered by the Award, the related Option shall be canceled automatically to the extent of the number of shares covered by such exercise. Moreover, all Tandem SARs shall expire not later than 10 years from the Effective Date of the SAR’s grant.

9.3. Terms and Conditions of Freestanding SARs. Freestanding SARS shall be exercisable or automatically mature in accordance with such terms and conditions and at such times and during such periods as may be determined by the Committee. The exercise price of a Freestanding SAR shall be not less than 100% of the Fair Market Value of the Common Stock, as determined by the Committee, on the Effective Date of the Freestanding SAR’s grant. Notwithstanding the foregoing, if the Company acquires another entity, the Company may substitute Freestanding SARs with exercise prices below the Fair Market Value requirement stated above for any freestanding stock appreciation right previously issued by such acquired company, to the extent permitted by Section 409A of the Code and/or Section 424 of the Code. Moreover, all Freestanding SARs shall expire not later than 10 years from the Effective Date of the Freestanding SAR’s grant.

9.4. Deemed Exercise. The Committee may provide that an SAR shall be deemed to be exercised at the close of business on the scheduled expiration date of such SAR if at such time the SAR by its terms remains exercisable and, if so exercised, would result in a payment to the holder of such SAR.

9.5. Additional Terms and Conditions. The Committee may, by way of the Award Notice or otherwise, determine such other terms, conditions, restrictions and/or limitations, if any, including vesting and post-termination exercise periods of any SAR Award, provided they are not inconsistent with the Plan.

ARTICLE 10

STOCK AWARDS

10.1. Grants. Awards may be granted in the form of Stock Awards. Stock Awards shall be awarded in such numbers and at such times during the term of the Plan as the Committee shall determine.

10.2. Stock Award Restrictions. Stock Awards shall be subject to such terms, conditions, restrictions, and/or limitations, if any, as the Committee deems appropriate including, but not by way of limitation, restrictions on transferability and continued employment, provided, however, they are not inconsistent with the Plan. The Committee may modify or accelerate the delivery of a Stock Award under such circumstances as it deems appropriate.

10.3. Performance Criteria. Stock Awards may be contingent on the attainment during a Performance Period of certain performance objectives. The length of the Performance Period, the Performance Goals to be achieved during the Performance Period, and the measure of whether and to what degree such goals have been attained shall be conclusively determined by the Committee in the exercise of its absolute discretion. Performance Goals may be revised by the Committee, at such times as it deems appropriate during the Performance Period, in order to take into consideration any unforeseen events or changes in circumstances.

10.4. Rights as Stockholders. During the period in which any Restricted Stock are subject to any restrictions imposed under Section 10.2, the Committee may, in its sole discretion, grant to the Participant to whom such Restricted Stock have been awarded all or any of the rights of a stockholder with respect to such shares, including, but not by way of limitation, the right to vote such shares and, pursuant to Article 15, the right to receive dividends.

10.5. Evidence of Award. Any Stock Award granted under the Plan may be evidenced in such manner as the Committee deems appropriate, including, without limitation, book-entry, registration or issuance of a stock certificate or certificates.

ARTICLE 11

PERFORMANCE UNITS

11.1. Grants. Awards may be granted in the form of performance units. Performance units, as that term is used in this Plan, shall refer to Units valued by reference to designated criteria established by the Committee, other than Common Stock.

11.2. Performance Criteria. Performance units shall be contingent on the attainment during a Performance Period of certain performance objectives. The length of the Performance Period, the performance objectives to be achieved during the Performance Period, and the measure of whether and to what degree such objectives have been attained shall be conclusively determined by the Committee in the exercise of its absolute discretion. Performance objectives may be revised by the Committee, at such times as it deems appropriate during the Performance Period, in order to take into consideration any unforeseen events or changes in circumstances.

11.3. Additional Terms and Conditions. The Committee may, by way of the Award Notice or otherwise, determine such other terms, conditions, restrictions, and/or limitations, if any, of any Award of performance units, provided they are not inconsistent with the Plan.

ARTICLE 12

PERFORMANCE SHARES

12.1. Grants. Awards may be granted in the form of performance shares. Performance shares, as that term is used in this Plan, shall refer to shares of Common Stock or Units that are expressed in terms of Common Stock.

12.2. Performance Criteria. Performance shares shall be contingent upon the attainment during a Performance Period of certain performance objectives. The length of the Performance Period, the performance objectives to be achieved during the Performance Period, and the measure of whether and to what degree such objectives have been attained shall be conclusively determined by the Committee in the exercise of its absolute discretion. Performance objectives may be revised by the Committee, at such times as it deems appropriate during the Performance Period, in order to take into consideration any unforeseen events or changes in circumstances.

12.3. Additional Terms and Conditions. The Committee may, by way of the Award Notice or otherwise, determine such other terms, conditions, restrictions and/or limitations, if any, of any Award of performance shares, provided they are not inconsistent with the Plan.

ARTICLE 13

VESTING AND PAYMENT OF AWARDS

13.1. Vesting. The time when an Option or SAR shall vest and become exercisable shall be stated in the Award Notice. The restrictions, if any, on Restricted Stock shall expire at the times designated in the Award Notice. Notwithstanding the foregoing, (i) no Option shall vest before the one-year anniversary of the Effective Date of such Option, unless such vesting is accelerated in accordance with the other provisions of this Article 13 (not including this Section 13.1) or Article 16, (ii) the Committee may determine an appropriate vesting schedule for any Award granted by the Company in substitution of an equity award previously granted by an entity acquired by the Company, to the extent permitted by Section 409A of the Code and Section 424 of the Code,

and (iii) no Restricted Stock shall vest faster than pro rata over a three-year period from the Effective Date, unless such Restricted Stock was issued to a Director, as a form of payment of earned performance awards or other incentive compensation, to replace a deferred Stock Award, to replace awards that a new Employee has forfeited from his or her previous employer, or the restrictions lapse earlier due to the other provisions of this Article 13 (not including this Section 13.1) or Article 16.

13.2. Payment. Absent a Plan provision to the contrary, payment of Awards may, at the discretion of the Committee, be made in cash, Common Stock, a combination of cash and Common Stock, or any other form of property as the Committee shall determine. In addition, payment of Awards may include such terms, conditions, restrictions and/or limitations, if any, as the Committee deems appropriate, including, in the case of Awards paid in the form of Common Stock, restrictions on transfer and forfeiture provisions; provided, however, such terms, conditions, restrictions and/or limitations are not inconsistent with the Plan. Further, payment of Awards may be made in the form of a lump sum or installments, as determined ,by the Committee.

13.3. Death. The Committee shall have the authority to promulgate rules and regulations to determine the treatment of a Participant under the Plan in the event of such Participant’s death. Unless otherwise provided in an Award Notice, in the event that a Participant shall die while he or she is an Employee, Director or Consultant and prior to the complete exercise of Options or complete maturity of SARs granted to him or her under the Plan, any such remaining Options or SARs shall be fully vested and may be exercised in whole or in part within one year after the date of the Participant’s death and then only: (i) by the beneficiary designated by the Participant in a writing submitted to the Company prior to the Participant’s death, or in the absence of same, by the Participant’s estate or by or on behalf of such person or persons to whom the Participant’s rights pass under his or her will or the laws of descent and distribution, (ii) to the extent that the Participant would have been entitled to exercise the Option or SAR at the date of his or her death had it been fully vested, and subject to all of the conditions on exercise imposed by the Plan and the Award Notice, and (iii) prior to the expiration of the term of the Option or SAR. Notwithstanding this Section or the terms of an Award Notice, the Committee shall have the right to extend the period for exercise of an Option or SAR to the extent that such exercise period extension will not result in an additional tax to the Participant under Section 409A of the Code, even if such extension exceeds the original term of such Option or SAR.

13.4. Disability. The Committee shall have the authority to promulgate rules and regulations to determine the treatment of a Participant under the Plan in the event of such Participant’s Disability. Unless otherwise provided in an Award Notice, in the event that a Participant’s status as an Employee, Director or Consultant terminates due to the Participant’s Disability prior to the complete exercise of Options or complete maturity of SARs granted to him or her under the Plan, any such remaining Options or SARs shall be fully vested and may be exercised in whole or in part up to three years after the Participant’s termination of status due to Disability as an Employee, Director or Consultant, as the case may be. Notwithstanding this Section or the terms of an Award Notice, the Committee shall have the right to extend the period for exercise of an Option or SAR to the extent that such exercise period extension will not result in an additional tax to the Participant under Section 409A of the Code, even if such extension exceeds the original term of such Option or SAR.

13.5. Retirement. The Committee shall have the authority to promulgate rules and regulations to determine the treatment of a Participant under the Plan in the event of such Participant’s Retirement. Unless otherwise provided in an Award Notice, in the event that a Participant’s status as an Employee, Director or Consultant terminates due to Retirement prior to the complete exercise of Options or complete maturity of SARs granted to him or her under the Plan, any such remaining Options or SARs that were vested as of the date of Retirement may be exercised in whole or in part up to three years after the Participant’s Retirement. During such period, the Participant shall also continue to vest in any unvested Options or SARs as if such Participant were still an Employee, Director or Consultant hereunder, as applicable; provided that the such Participant does not violate any applicable non-competition, non-disparagement, non-solicitation, confidentiality or other similar requirement. At the end of the three-year period, any remaining unvested Options or SARs shall terminate, unless the Committee provides otherwise. Notwithstanding this Section or the terms of an Award Notice, the Committee shall have the right to extend the period for exercise of a Option or SAR to the extent that such exercise period extension will not result in an additional tax to the Participant under Section 409A of the Code, provided such extension does not exceed the term of such Option or SAR and that the Participant does not violate any applicable non-competition, non-disparagement, non-solicitation, confidentiality or other similar requirement.

13.6. Approved Reason. The Committee shall have the authority to promulgate rules and regulations to determine the treatment of a Participant under the Plan in the event of a Participant’s termination for an Approved Reason, to the extent such rules and regulations are not inconsistent with the Plan.

13.7. Termination for Cause. A Participant who is terminated for Cause shall, unless otherwise determined by the Committee, immediately: forfeit, effective as of the date the Participant engages in such conduct, all unexercised, unearned, and/or unpaid Awards, including, but not by way of limitation, Awards earned but not yet paid, all unpaid dividends and dividend equivalents, and all interest, if any, accrued on the foregoing.

13.8. Other Terminations. Subject to the terms of any employment or other agreement a Participant has with the Company, if a Participant’s employment with the Company terminates for a reason other than death, Disability, Retirement, Cause or an Approved Reason, and, unless otherwise provided in an Award Notice, any Option or SAR shall be exercisable on termination of a Participant’s status as an Employee, Director or Consultant only to the extent such Option or SAR is vested and exercisable at the time of the termination of such relationship; and further, no Option or SAR shall be exercisable or mature after the later of 90 days or the expiration of the term thereof. The Committee, in its absolute discretion, may: (i) accelerate the vesting and exercisability of an Option or SAR in order to allow its exercise by a terminating Participant; (ii) extend the period for exercise of an Option or SAR to the extent that such exercise period extension will not result in an additional tax to the Participant under Section 409A of the Code, provided such extension does not exceed the term of such Option or SAR.

13.9. Incentive Stock Options. Unless otherwise provided in an Award Notice, an Incentive Stock Option shall be exercisable, during the lifetime of the Participant, only while he or she is an Employee and has been an Employee continuously since the grant of the Incentive Stock Option or, subject to the Award Notice, within three (3) months after termination of his or her employment. In its sole discretion, the Committee may provide in the Award Notice such further limitations on the survival of Incentive Stock Options, and such limitations on the survival of Non-Qualified Stock Options and SARs, as it may determine; provided, however that all Options and SARs shall be exercisable for a minimum of sixty (60) days after termination of a Participant’s employment, except in the case of termination for Cause, in which case the exercise period shall lapse at termination.

13.10. Other Awards.

(a) The Committee shall have the authority to promulgate rules and regulations to determine the treatment of the Stock Awards of a Participant under the Plan in the event of such Participant’s death, Disability, Retirement, or termination from the Company for an Approved Reason or Cause. Unless otherwise provided in an Award Notice, upon a Participant’s death, Disability, or Retirement, or termination from the Company for an Approved Reason, any Stock Awards held by such Participant shall accelerate and become fully vested.

(b) If a Participant’s employment with the Company terminates for any reason other than death, Disability or Retirement, or an Approved Reason, and except as otherwise provided by Section 13.7, all unexercised, unearned, and/or unpaid Awards, including without limitation, Awards earned but not yet paid, all unpaid dividends and dividend equivalents, and all interest accrued on the foregoing shall be canceled or forfeited, as the case may be, unless the Participant’s Award Notice or the Committee provides otherwise.

13.11. Set-Off. By accepting an Award under this Plan, a Participant consents to a deduction from any amounts the Company owes the Participant from time to time (including, but not limited to, amounts owed to the Participant as wages or other compensation, fringe benefits, or vacation pay), to the extent of the amounts the Participant owes the Company under Section 13.11(a). Whether or not the Company elects to make any set-off in whole or in part, if the Company does not recover by means of set-off the full amount the Participant owes the Company, the Participant shall immediately pay the unpaid balance to the Company.

ARTICLE 14

DIVIDEND AND DIVIDEND EQUIVALENTS

If an Award is granted in the form of a Stock Award, Option, SAR or performance share, the Committee may choose, at the time of the grant of the Award or any time thereafter up to the time of the Award’s payment, to include as part of such Award an entitlement to receive dividends or dividend equivalents, subject to such terms, conditions, restrictions and/or limitations, if any, as the Committee may establish. Dividends and dividend equivalents shall be paid in such form and manner (i.e., lump sum or installments), and at such time(s) as the Committee shall determine. All dividends or dividend equivalents which are not paid currently may, at the Committee’s discretion, accrue interest, be reinvested into additional shares of Common Stock of, in the case of dividends or dividend equivalents, credited in connection with Stock Awards or performance shares, be credited as additional Stock Awards or performance shares and paid to the Participant if and when, and to the extent that, payment is made pursuant to such Award. The total number of shares available for grant under shall not be reduced to reflect any dividends or dividend equivalents that are reinvested into additional shares of Common Stock or credited as additional Stock Awards or performance shares.

ARTICLE 15

DEFERRAL OF AWARDS

15.1. At the discretion of the Committee, payment of any Award, dividend, or dividend equivalent, or any portion thereof, may be deferred by a Participant until such time as the Committee may establish. All such deferrals shall be accomplished by the delivery of a written, irrevocable election by the Participant prior to the time established by the Committee for such purpose, on a form provided by the Company. Further, all deferrals shall be made in accordance with administrative guidelines established by the Committee to ensure that such deferrals comply with all applicable requirements of the Code. Deferred payments shall be paid in a lump sum or installments, as determined by the Committee. Deferred Awards may also be credited with interest, at such rates to be determined by the Committee, and, with respect to those deferred Awards denominated in the form of Common Stock, with dividends or dividend equivalents.

15.2. Elections to Defer. Notwithstanding any provision of the Plan to the contrary, any Participant may, at the discretion of the Committee, elect to defer to a specified date the receipt of unrestricted Common Stock or cash, or any portion thereof, that the Participant would otherwise be entitled to receive pursuant to an Award by completing such form required by the Committee and returning it to the Committee on or before the December 31 preceding the calendar year during which such Award is granted to the Participant.

15.3. New Participant Elections to Defer. Each individual who becomes a Participant during a calendar year may, at the discretion of the Committee, elect to defer to a specified date the receipt of unrestricted Common Stock or cash payment, as applicable, that the Participant would otherwise be entitled to receive pursuant to an Award granted to the Participant after such date such individual became a Participant by completing such form required by the Committee and returning it to the Committee on or before the date that is 30 days after the date on which the individual became a Participant.

15.4. Elections Irrevocable. An election to defer an Award shall become irrevocable on the first day of the calendar year to which such election applies or, solely in the case of a new Participant, 30 days after the date on which the individual became a Participant.

15.5. Individual Elections. A Participant must complete a deferral election form in accordance with Section 15.1 or Section 15.2, as applicable, for each calendar year in which such Participant desires to defer Awards and a Participant’s elections with respect to Awards deferred in a particular calendar year shall expire as of the last day of such calendar year.

15.6. Establishment of Calendar Year Subaccounts. The Company may establish on its books for each Participant and for each calendar year a Calendar Year Subaccount to which a Participant’s Awards deferred in a particular calendar year are credited. A separate Calendar Year Subaccount shall be created within each Participant’s Account for each calendar year in which the Participant makes an Award deferral under the Plan.

15.7. Effect on Vesting. Notwithstanding anything herein to the contrary, this Section 15 shall not effect the vesting or vested percentage of a Participant’s Award. Any unvested Award will not be distributed pursuant to this Section 15 or otherwise.

15.8. Effect of Death, Disability and Change in Control. Subject to the provisions of this Section 15.8, the Participant’s Awards credited to a particular Calendar Year Subaccount shall be distributed to him or her at the time specified in his or her deferral election form related to the particular calendar year. Notwithstanding any election made by a Participant to the contrary, any deferred Awards that have not been distributed to the Participant as of the date (i) of his or her death, (ii) on which he or she is determined to be Disabled, or (iii) of a Change in Control shall be paid to the Participant’s Beneficiary in a lump sum upon such Participant’s death, date of Disability determination or Change in Control, as applicable.

ARTICLE 16

CHANGE IN CONTROL

16.1. Background. Except as provided in an employment, change in control, severance or similar agreement between the Participant and the Company, notwithstanding any provision contained in the Plan, including, but not limited to, Section 4.5, the provisions of this Article 16 shall control over any contrary provision.

16.2. Options and SARs. With respect to all Options and SARs that are unexercised and outstanding, upon a Change In Control, such Options and/or SARs shall become immediately and fully vested and exercisable; unless such Options and/or SARs are assumed by the successor corporation, and shall be substituted with options or SARs involving the common stock of the successor corporation with equivalent value and with the terms and conditions of the substituted options or SARs being no less favorable than the Options or SARs granted hereunder. Substituted awards shall vest in full if employment is terminated for any reason other than Cause or voluntary termination within eighteen (18) months of the Change In Control.

16.3. Stock Awards. With respect to all Stock Awards that are outstanding, upon a Change In Control, such Stock Awards shall become immediately and fully vested; unless such Stock Awards are assumed by the successor corporation, and are substituted with stock awards involving the common stock of the successor corporation with equivalent value and with the terms and conditions of the substituted restricted stock awards being no less favorable than the Stock Awards granted hereunder. Substituted awards shall vest in full if employment is terminated for any reason other than Cause or voluntary termination within eighteen (18) months of the Change In Control.

16.4. Treatment of Performance Units and Performance Shares. If a Change In Control occurs during the term of one or more performance periods for which the Committee has granted performance units and/or performance shares (including those issued as Performance Awards under Article 7), the term of each such performance period (hereinafter a “current performance period”) shall immediately terminate upon the occurrence of such event. Upon a Change In Control, for each “current performance period” and each completed performance period for which the Committee has not on or before such date made a determination as to whether and to what degree the performance objectives for such period have been attained (hereinafter a “completed performance period”), it shall be assumed that the performance objectives have been attained at a level of one hundred percent (100%) or the equivalent thereof. A Participant in one or more “current performance periods” shall be considered to have earned and, therefore, be entitled to receive, a prorated portion of the Awards previously granted to him for each such “current performance period.” Such prorated portion shall be determined by multiplying the number of performance shares or performance units, as the case may be, granted to the Participant by a fraction, the numerator of which is the total number of days that have elapsed since the beginning of the “current performance period,” and the denominator of which is the total number of days in such “current performance period.” A Participant in one or more “completed performance periods” shall be considered to have earned and, therefore, be entitled to receive all the performance shares or performance units, as the case may be, previously granted to him during each ‘such “completed performance period.”

16.5. Deferred Awards. Unless otherwise provided by the Committee, at any time, upon a Change In Control, any Awards deferred by a Participant under Article 16 hereof, but for which he or she has not received payment as of such date, shall be paid as soon as practicable, but in no event later than 90 days after the Change In Ownership or the event giving rise to rights under Article 17.

ARTICLE 17

MISCELLANEOUS

17.1. Nonassignability.

(a) In General. Except as otherwise determined by the Committee or as otherwise provided in Section 17.1(b), no Awards or any other payment under the Plan shall be subject in any manner to alienation, anticipation, sale, transfer (except by will or the laws of descent and distribution), assignment, pledge, or encumbrance, nor shall any Award be payable to or exercisable by anyone other than the Participant to whom it was granted.

(b) Non-Qualified Stock Options. The Committee shall have the discretionary authority to grant Non-Qualified Stock Options or amend outstanding Non-Qualified Stock Options to provide that they be transferable, subject to such terms and conditions as the Committee shall establish. In addition to any such terms and conditions, the following terms and conditions shall apply to all transfers of Non-Qualified Stock Options:

(1) Permissible Transferees. Transfers shall only be permitted to: (i) the Participant’s “Immediate Family Members,” as that term is defined in Section 17.1(b)(8); (ii) a trust or trusts for the exclusive benefit of such Immediate Family Members; or (iii) a family partnership or family limited partnership in which each partner is, at the time of transfer and all times subsequent thereto, either an Immediate Family Member or a trust for the exclusive benefit of one or more Immediate Family Members.

(2) No Consideration. All transfers shall be made for no consideration.

(3) Subsequent Transfers. Once a Participant transfers a Non-Qualified Stock Option, any subsequent transfer of such transferred Option shall, notwithstanding Section 17.1(b)(1) to the contrary, be permitted provided, however, such subsequent transfer complies with all of the terms and conditions of this Section 17.1, with the exception of Section 17.1(b)(1).

(4) Transfer Agent. In order for a transfer to be effective, the Committee’s designated transfer agent must be used to effectuate the transfer. The costs of such transfer agent shall be borne solely by the transferor.

(5) Withholding. In order for a transfer to be effective, a Participant must agree in writing prior to the transfer on a form provided by the Company to pay any and all payroll and withholding taxes due upon exercise of the transferred option. In addition, prior to the exercise of a transferred option by a transferee, arrangements must be made by the Participant with the Company for the payment of all payroll and withholding taxes.

(6) Terms and Conditions of Transferred Option. Upon transfer, a Non-Qualified Stock Option continues to be governed by and subject to the terms and conditions of the Plan and the option’s applicable administrative guide and Award Notice. A transferee of a Non-Qualified Stock Option is entitled to the same rights as the Participant to whom such Non-Qualified Stock Options was awarded, as if no transfer had taken place. Accordingly, the rights of the transferee are subject to the terms and conditions of the original grant to the Participant, including provisions relating to expiration date, exercisability, exercise price and forfeiture.

(7) Notice to Transferees. The Company shall be under no obligation to provide a transferee with any notice regarding the transferred Options held by the transferee upon forfeiture or any other circumstance.

(8) Immediate Family Member. For purposes of this Section 17.1, the term “Immediate Family Member” shall mean the Participant and his or her spouse, children or grandchildren, whether natural, step- or adopted children or grandchildren.

17.2. Withholding Taxes. The Company shall be entitled to deduct from any payment under the Plan, regardless of the form of such payment, the amount of all applicable income and employment taxes required by law to be withheld with respect to such payment or may require the Participant to pay to it such tax prior to and as a condition of the making of such payment. In accordance with any applicable administrative guidelines it establishes, the Committee may allow a Participant to pay the amount of taxes required by law to be withheld from an Award by withholding from any payment of Common Stock due as a result of such Award, or by permitting the Participant to deliver to the Company, shares of Common Stock having a Fair Market Value, as determined by the Committee.

17.3. Section 409A. To the extent determined necessary or advisable by the Committee in its sole discretion, Awards hereunder, and Award deferrals hereunder, shall be interpreted to the extent possible to comply with the provisions of section 409A of the Code (or avoid application of such Code section), to the extent applicable. Participants shall be deemed to consent to any changes to Awards, or any Award deferral, that the Board determines are necessary or advisable to comply with the provisions of section 409A of the Code. Adjustments made pursuant to Section 16 shall, to the extent determined necessary or advisable in the sole discretion of the Committee, be made in compliance with the requirements of section 409A of the Code or, if applicable, to avoid application of section 409A of the Code.

17.4. Amendments to Awards. The Committee may at any time unilaterally amend any unexercised, unearned, or unpaid Award, including, but not by way of limitation, Awards earned but not yet paid, to the extent it deems appropriate; provided, however, (i) no Award may be repriced, replaced with cash or another award, regranted through cancellation, or modified without shareholder approval if the effect would be to reduce the exercise price for the shares underlying the Award, and (ii) that any such amendment which, in the opinion of the Committee, is adverse to the Participant shall require the Participant’s consent.

17.5. Regulatory Approvals and Listings. Notwithstanding anything contained in this Plan to the contrary, the Company shall have no obligation to issue or deliver certificates of Common Stock evidencing Stock Awards or any other Award resulting in the payment of Common Stock prior to (i) the obtaining of any approval from any governmental agency which the Company shall, in its sole discretion, determine to be necessary or advisable, (ii) the admission of such shares to listing on the stock exchange on which the Common Stock may be listed, and (iii) the completion of any registration or other qualification of said shares under any state or federal law or ruling of any governmental body which the Company shall, in its sole discretion, determine to be necessary or advisable.

17.6. No Right to Continued Employment, Service or Grants. Participation in the Plan shall not give any Employee, Consultant or Director any right to remain in the employ or service of the Company. Further, the adoption of this Plan shall not be deemed to give any Employee, Consultant or Director or any other individual any right to be selected as a Participant or to be granted an Award. In addition, no Employee, Consultant or Director having been selected for an Award, shall have at any time the right to receive any additional Awards.

17.7. Amendment/Termination. The Board may suspend or terminate the Plan at any time for any reason with or without prior notice. In addition, the Board may, from time to time for any reason and with or without prior notice, amend the Plan in any manner, but may not, without stockholder approval, adopt any amendment which would increase the number of shares available under the Plan, which would alter the provisions of Section 4.3 or 17.4 as they relate to Option repricing, or which would require the vote of the stockholders of the Company pursuant to Section 162(m) of the Code or any applicable rule of the exchange or quotation system on which the Common Stock is traded, but only insofar as such amendment affects Covered Employees, or if such approval is necessary or deemed advisable with respect to tax, securities, or other applicable laws, policies, or regulations. Notwithstanding the foregoing, the Committee may not revoke, remove or reduce any vested right of a Participant without the prior written consent of such Participant.

17.8. Governing Law. The Plan shall be governed by and construed in accordance with the laws of the State of Delaware, except as superseded by applicable federal law, without giving effect to its conflicts of law provisions.

17.9. No Right, Title, or Interest in Company Assets. No Participant shall have any rights as a stockholder of the Company as a result of participation in the Plan until the date of issuance of a stock certificate in his or her name, and, in the case of Restricted Stock, such rights are granted to the Participant under the Plan. To the extent any person acquires a right, to receive payments from the Company under the Plan, such rights shall be no greater than the rights of an unsecured creditor of the Company and the Participant shall not have any rights in or against any specific assets of the Company. All of the Awards granted under the Plan shall be unfunded.

17.10. Section 16 of the Exchange Act. In order to avoid any Exchange Act violations, the Committee may, from time to time, impose additional restrictions upon an Award, including but not limited to, restrictions regarding tax withholdings and restrictions regarding the Participant’s ability to exercise Awards under the Company’s broker-assisted stock option exercise program.

17.11. No Guarantee of Tax Consequences. No person connected with the Plan in any capacity, including, but not limited to, the Company and its directors, officers, agents and employees, makes any representation, commitment, or guarantee that any tax treatment, including, but not limited to, federal, state and local income, estate and gift tax treatment, will be applicable with respect to the tax treatment of any Award, any amounts deferred under the Plan, or paid to or for the benefit of a Participant under the Plan, or that such tax treatment will apply to or be available to a Participant on account of participation in the Plan.

EX-4.5

Exhibit 4.5

WARRANT

PHARMACOPEIA DRUG DISCOVERY, INC.

WARRANTS FOR THE PURCHASE OF SHARES OF COMMON STOCK

No. W-2006-[    ] [            ] Shares

THIS CERTIFIES that, for value received, Pharmacopeia Drug Discovery, Inc., a Delaware corporation (the “Company”), upon the surrender of this Warrant to the Company at the address specified herein, at any time during the Exercise Period (as defined below) will upon receipt of the Exercise Price (as defined below), sell and deliver to [                    ] (the “Holder”) up to the number of duly authorized, validly issued and fully paid and nonassessable shares of common stock of the Company, par value $0.01 per share, set forth above. The term “Common Stock” shall mean the aforementioned common stock of the Company together with any other equity securities that may be issued by the Company in connection therewith or in substitution therefor, as provided herein, that is not limited as to final sum or percentage in respect of the rights of the holders thereof to participate in dividends or in distribution of assets upon the voluntary or involuntary liquidation, dissolution or winding up of the Company. The “Exercise Period” shall begin on April [    ], 2006 and shall end on April [    ], 2011. During the Exercise Period, the Holder may purchase such number of shares of Common Stock at a purchase price per share equal to $5.14 as appropriately adjusted pursuant to Section G hereof (the “Exercise Price”).

The number of shares of Common Stock to be received upon the exercise of this Warrant and the price to be paid for a share of Common Stock are subject to adjustment from time to time as hereinafter set forth. The shares of Common Stock deliverable upon such exercise, as adjusted from time to time, are hereinafter sometimes referred to as “Warrant Shares.”

Section A. Exercise of Warrant. This Warrant may be exercised in whole or in part, at any time or from time to time, during the Exercise Period by presentation and surrender hereof to the Company at 3000 Eastpark Boulevard, Cranbury, New Jersey 08512 (or at such other address as the Company or its agent may hereafter designate in writing to the Holder), or at the office of its warrant agent, with the Notice of Exercise Form contained herein duly executed and accompanied by a wire transfer of immediately available funds, cash or a certified or official bank check drawn to the order of “Pharmacopeia Drug Discovery, Inc.” in the amount of the Exercise Price multiplied by the number of Warrant Shares specified in such form. If this Warrant should be exercised in part only, the Company shall, upon surrender of this Warrant, promptly execute and deliver a new Warrant evidencing the rights of the Holder thereof to purchase the balance of the Warrant Shares purchasable hereunder. Upon receipt by the Company during the Exercise Period of this Warrant and such Notice of Exercise Form, in proper form for exercise, together with proper payment of the Exercise Price, at such office, or by the warrant agent of the Company at its office, the Holder shall be deemed to be the holder of record of the number of Warrant Shares specified in such form; provided, however, that if the date of such receipt by the Company or its agent is a date on which the stock transfer books of the Company are closed, such person shall be deemed to have become the record holder of such shares on, and such certificate shall be dated, the next succeeding business day on which the stock transfer books of the Company are open. The Company shall pay any and all documentary, stamp or similar issue or transfer taxes payable in respect of the issue or delivery of such Warrant Shares. Any new or substitute Warrant issued under this Section A or any other provision of this Warrant shall be dated the date of this Warrant. Upon exercise of this Warrant, the Company or its warrant agent shall, within 3 business days, cause to be issued and shall promptly deliver upon written order of the Holder of this Warrant, and in such name or names as such Holder may designate, a certificate or certificates for the Warrant Shares, which Warrant Shares shall be issued unlegended and free of any resale restrictions, except as otherwise provided herein. If the Company’s transfer agent is a participant in the DTC FAST system, then such Warrant Shares shall be delivered electronically by crediting the broker account designated by the Holder pursuant to the DWAC system.

At any time during the Exercise Period, the Holder may elect to exercise all or any part of this Warrant by means of a “cashless exercise” in which the Holder shall be entitled to receive a certificate (unlegended and free of any resale restrictions when there is an effective registration statement permitting the sale of the Warrant Shares by the Company to the Holder in effect or with appropriate legends and subject to resale restrictions when there is no effective registration statement permitting the sale of the Warrant Shares by the Company to the Holder) for the number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:

(A) = the volume weighted average share price on the business day during normal trading hours (9:30 a.m. to 4:00 p.m. NY time) immediately preceding the date of such election as reported by Bloomberg, L.P.;

(B) = the Exercise Price of this Warrant, as adjusted; and

(X) = the number of Warrant Shares issuable upon exercise of this Warrant in accordance with the terms of this Warrant by means of a cash exercise rather than a cashless exercise.

If the Holder elects to exercise all or any part of this Warrant other than by means of a “cashless exercise” as provided above when there is no effective registration statement permitting the sale of the Warrant Shares by the Company to the Holder, then the Company may, upon any such exercise, issue Warrant Shares to the Holder with appropriate legends and subject to resale restrictions.

If the Company fails to deliver to the Holder a certificate or certificates representing the Warrant Shares pursuant to this Section A by the 3rd business day after exercise hereof, then the Holder will have the right to rescind such exercise. In addition to any other rights available to the Holder, if the Company fails to cause its transfer agent to transmit to the Holder a certificate or certificates representing the Warrant Shares pursuant to an exercise on or before the fifth business day following a Warrant exercise, and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a “Buy-In”), then the Company shall (1) pay in cash to the Holder the amount by which (x) the Holder’s total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (A) the number of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times (B) the price at which the sell order giving rise to such purchase obligation was executed, and (2) at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored or deliver to the Holder the number of shares of Common Stock that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of shares of Common Stock with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (1) of the immediately preceding sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In, together with applicable confirmations and other evidence reasonably requested by the Company. Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver certificates representing shares of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.

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Notwithstanding anything herein to the contrary, the Holder shall not have the right to exercise any portion of this Warrant, pursuant to Section A or otherwise, to the extent that after giving effect to such issuance after exercise, the Holder (together with the Holder’s affiliates), as set forth on the applicable Notice of Exercise, would beneficially own in excess of 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to such issuance. For purposes of the foregoing sentence, the number of shares of Common Stock beneficially owned by the Holder and its affiliates shall include the number of shares of Common Stock issuable upon exercise of this Warrant with respect to which the determination of such sentence is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (A) exercise of the remaining, nonexercised portion of this Warrant beneficially owned by the Holder or any of its affiliates and (B) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation, any other Warrants) subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its affiliates. Except as set forth in the preceding sentence, for purposes of this provision, beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act. To the extent that the limitation contained in this provision applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder) and of which a portion of this Warrant is exercisable shall be in the sole discretion of such Holder, and the submission of a Notice of Exercise shall be deemed to be such Holder’s determination of whether this Warrant is exercisable (in relation to other securities owned by such Holder) and of which portion of this Warrant is exercisable, in each case subject to such aggregate percentage limitation, and the Company shall have no obligation to verify or confirm the accuracy of such determination. For purposes of this provision, in determining the number of outstanding shares of Common Stock, the Holder may rely on the number of outstanding shares of Common Stock as reflected in (x) the Company’s most recent Form 10-Q or Form 10-K, as the case may be, (y) a more recent public announcement by the Company or (z) any other notice by the Company or the Company’s Transfer Agent setting forth the number of shares of Common Stock outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by the Holder or its affiliates since the date as of which such number of outstanding shares of Common Stock was reported.

Section B. Warrant Register. This Warrant will be registered in a register (the “Warrant Register”) to be maintained by the Company or its agent at its principal office in the name of the recordholder to whom it has been distributed. The Company may deem and treat the registered holder of this Warrant as the absolute owner thereof (notwithstanding any notation of ownership or other writing hereon made by anyone), for the purpose of any exercise thereof or any distribution to the holder thereof and for all other purposes, and the Company shall not be affected by any notice to the contrary.

Section C. Reservation of Shares. The Company hereby agrees that at all times there shall be reserved for issuance and delivery upon exercise of this Warrant all shares of its Common Stock or other shares of capital stock of the Company from time to time issuable upon exercise of this Warrant. All such shares shall be duly authorized and, when issued upon such exercise in accordance with the terms of this Warrant, shall be validly issued, fully paid and nonassessable, free and clear of all liens, security interests, charges and other encumbrances or restrictions on sale and free and clear of all preemptive rights.

Section D. Transfer of Warrant. Subject to compliance with applicable federal and state securities laws, this Warrant and all rights hereunder are transferable, in whole or in part, without charge to the Holder hereof (except for transfer taxes), upon surrender of this Warrant properly endorsed.

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Section E. Lost, Mutilated or Missing Warrant. Upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant, and (in the case of loss, theft or destruction) of reasonably satisfactory indemnification, and upon surrender and cancellation of this Warrant, if mutilated, the Company, at its expense, shall execute and deliver a new Warrant of like tenor and date.

Section F. Rights of the Holder. Subject to applicable law, the Holder shall not, by virtue hereof, be entitled to any rights or subject to any obligation or liability of a shareholder in the Company, either at law or equity, and the rights of the Holder are limited to those expressed in this Warrant.

Section G. Adjustments. The Exercise Price and the number of shares purchasable hereunder are subject to adjustment from time to time as follows:

1. Stock Dividend, Split or Subdivision of Shares. If the number of shares of Common Stock outstanding at any time after the date hereof is increased by a stock dividend payable to all holders of Common Stock in shares of Common Stock or by a subdivision or split-up of shares of Common Stock, then, following the record date fixed for the determination of holders of Common Stock entitled to receive such stock dividend, subdivision or split-up, the Exercise Price shall be appropriately decreased and the number of shares of Common Stock issuable on exercise of each Warrant shall be increased in proportion to such increase in outstanding shares.

2. Combination of Shares. If, at any time after the date hereof, the number of shares of Common Stock outstanding is decreased by a combination or consolidation of the outstanding shares of Common Stock, by reclassification, reverse stock split or otherwise, then, following the record date for such combination, the Exercise Price shall be appropriately increased and the number of shares of Common Stock issuable on exercise of each Warrant shall be decreased in proportion to such decrease in outstanding shares.

3. Calculations. All calculations under this Section shall be made to the nearest one-tenth of a cent ($.001), or to the nearest one-tenth of a share, as the case may be.

4. Merger and Consolidation. If at any time there is a capital reorganization or reclassification of shares of Common Stock, or a merger or consolidation of the Company with or into another corporation where the Company is not the surviving corporation, or the sale of all or substantially all of the Company’s properties and assets to any other person, then as part of such reorganization, reclassification, merger, consolidation or sale, lawful provision shall be made so that the Holder shall thereafter be entitled to receive upon exercise of its rights to purchase Common Stock, the number of shares of Common Stock, cash, property or shares of the successor corporation resulting from such reorganization, reclassification, merger, consolidation or sale, deliverable upon exercise of the rights to purchase Common Stock hereunder, to which a holder of Common Stock would have been entitled in such reorganization, reclassification, merger, consolidation or sale if the right to purchase such Common Stock hereunder had been exercised immediately prior to such reorganization, reclassification, merger, consolidation or sale. In any such event, appropriate adjustment shall be made in the application of the provisions of this Warrant with respect to the rights and interests of the Holder after such reorganization, reclassification, merger, consolidation or sale so that the provisions of this Warrant (including Exercise Price and the number of shares of Common Stock purchasable pursuant to the terms and conditions of this Warrant) shall be applicable after that event as near as reasonably may be, in relation to any shares deliverable upon the exercise of the Holder’s rights to purchase Common Stock pursuant to this Warrant.

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5. Certificate as to Adjustments. Upon the occurrence of each adjustment or readjustment pursuant to this Section G, the Company, at its own expense, shall promptly compute such adjustment or readjustment in accordance with the terms hereof and furnish to each Holder a certificate setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment or readjustment is based. The Company shall, upon the written request, at any time, of any such Holder, furnish or cause to be furnished to such Holder a like certificate setting forth: (a) such adjustments and readjustments; (b) the Exercise Price at the time in effect; and (c) the number of shares and the amount, if any of other property that at the time would be received upon the exercise of the Warrant.

Section H. Fractional Shares. No fractional shares of the Company’s Common Stock will be issued in connection with any exercise hereunder but in lieu of such fractional shares the Company shall make a cash refund therefor equal in amount to the product of the applicable fraction multiplied by the Exercise Price paid by the Holder for one Warrant Share upon such exercise.

Section I. Notices of Certain Events. In the event:

1. the Company authorizes the issuance to all holders of its Common Stock of rights or warrants to subscribe for or purchase shares of its Common Stock or of any other subscription rights or warrants; or

2. the Company authorizes the distribution to all holders of its Common Stock of evidences of its indebtedness or assets (other than cash dividends or distributions except extraordinary cash dividends or distributions); or

3. of any capital reorganization or reclassification of the Common Stock (other than a subdivision or combination of the outstanding Common Stock and other than a change in par value of the Common Stock) or of any consolidation or merger to which the Company is a party or of the conveyance or transfer of all or substantially all of the properties and assets of the Company; or

4. of the voluntary or involuntary dissolution, liquidation or winding-up of the Company; or

5. any other actions would require an adjustment under Section G hereof;

then the Company will cause to be mailed to the Holder, at least 5 days before the applicable record or effective date hereinafter specified, a notice stating (A) the date as of which the holders of Common Stock of record entitled to receive any such rights, warrants or distributions are to be determined, or (B) the date on which any such consolidation, merger, conveyance, transfer, dissolution, liquidation or winding-up is expected to become effective, and the date as of which it is expected that holders of Common Stock of record will be entitled to exchange their shares of Common Stock for securities or other property, if any, deliverable upon such reorganization, reclassification, consolidation, merger, conveyance, transfer, dissolution, liquidation or winding-up.

Section J. Listing on Securities Exchanges. The Company will list on the Nasdaq Global Market and each national securities exchange on which any Common Stock may at any time be listed all shares of Common Stock from time to time issuable upon the exercise of this Warrant, subject to official notice of issuance upon the exercise of this Warrant, and will maintain such listing so long as any other shares of its Common Stock are so listed; and the Company shall so list on the Nasdaq Global Market and each national securities exchange, and shall maintain such listing of, any other shares of capital stock of the Company issuable upon the exercise of this Warrant if and so long as any shares of capital stock of the same class are listed on the Nasdaq Global Market and such national securities exchange by the Company. Any such listing will be at the Company’s expense.

5

Section K. Successors. All the provisions of this Warrant by or for the benefit of the Company shall bind and inure to the benefit of its respective successors and assigns.

Section L. Headings. The headings of sections of this Warrant have been inserted for convenience of reference only, are not to be considered a part hereof and shall in no way modify or restrict any of the terms or provisions hereof.

Section M. Amendments. The terms and provisions of this Warrant may not be modified or amended, or any provisions hereof waived, temporarily or permanently, except by written consent of the Company and the Holder hereof.

Section N. Notices. Unless otherwise provided in this Warrant, all notices, requests, consents and other communications hereunder shall be in writing, shall be sent by U.S. Mail or a nationally recognized overnight express courier postage prepaid, and shall be deemed given one day after being so sent, or if delivered by hand shall be deemed given on the date of such delivery to such party, or if sent to such party (in the case of a Holder) at its address in the Warrant Register that will be maintained by the Company or its agent in accordance with Section B hereof or (in the case of the Company) at its address set forth above, Attention: General Counsel, or to such other address as is designated by written notice, similarly given to each other party hereto.

Section O. Governing Law. This Warrant shall be deemed to be a contract made under the laws of the State of New York and for all purposes shall be construed in accordance with the laws of said State as applied to contracts made and to be performed in New York between New York residents.

6

IN WITNESS WHEREOF, the Company has duly caused this Warrant to be signed and attested by its duly authorized officer and to be dated as of October [    ], 2006.

PHARMACOPEIA DRUG DISCOVERY, INC.

By:

Name:

Title:

7

NOTICE OF EXERCISE

Date:                             , 20    

The undersigned hereby elects to exercise this Warrant to purchase              shares of Common Stock and hereby makes payment of $                 in payment of the exercise price thereof. Warrant Shares shall be delivered to the following address:

[Holder’s Name]

By:

Name:

Title:

8

EX-5.1

Exhibit 5.1

	12636 High Bluff Drive, Suite 400 San Diego, California 92130-2071 Tel: +1.858.523.5400 Fax: +1.858.523.5450 www.lw.com
	FIRM / AFFILIATE OFFICES
May 20, 2009	Abu Dhabi Barcelona Brussels Chicago Doha Dubai Frankfurt Hamburg Hong Kong London Los Angeles Madrid Milan Moscow	Munich New Jersey New York Orange County Paris Rome San Diego San Francisco Shanghai Silicon Valley Singapore Tokyo Washington, D.C.

Ligand Pharmaceuticals Incorporated

10275 Science Center Drive

San Diego, California 92121

Re: Registration Statement on Form S-3; up to 872,699 shares of Ligand Pharmaceuticals Incorporated common stock, par value $0.001 per share

Ladies and Gentlemen:

We have acted as special counsel to Ligand Pharmaceuticals Incorporated, a Delaware corporation (the “Company”), in connection with the proposed issuance of up to 872,699 shares (the “Shares”) of common stock of the Company, par value $0.001 per share, of which up to 867,637 Shares may be issued pursuant to certain warrants (the “Warrants”) to purchase shares of Pharmacopeia, Inc. (“Pharmacopeia”) common stock which were assumed by the Company and became exercisable to purchase shares of Company common stock, and of which up to 5,062 Shares may be issued pursuant to Pharmacopeia’s Amended and Restated 2004 Stock Incentive Plan and Pharmacopeia’s 2000 Stock Option Plan (together, the “Plans”) which were assumed by the Company and became exercisable to purchase shares of Company common stock. The Shares are included in a registration statement on Form S-3 under the Securities Act of 1933, as amended (the “Act”), filed with the Securities and Exchange Commission (the “Commission”) on February 13, 2009 (the “Registration Statement”). This opinion is being furnished in accordance with the requirements of Item 601(b)(5) of Regulation S-K under the Act, and no opinion is expressed herein as to any matter pertaining to the contents of the Registration Statement or related Prospectus, other than as expressly stated herein with respect to the issue of the Shares.

As such counsel, we have examined such matters of fact and questions of law as we have considered appropriate for purposes of this letter. With your consent, we have (i) assumed that prior to the issuance of any of the Shares the Registration Statement will have become effective under the Act, (ii) assumed that the proceedings proposed to be taken by the Company in connection with the authorization, issuance and delivery of the Shares will be taken in a timely manner, and (iii) relied upon the foregoing and upon certificates and other assurances of officers of the Company and others as to factual matters; we have not independently verified such factual matters. In our examination, we have assumed the genuineness of all signatures, the authenticity of all documents submitted to us as originals and the conformity to authentic original documents of all documents submitted to us as copies. We are opining herein as to the General Corporation Law of the State of Delaware, and we express no opinion with respect to any other laws.

May 20, 2009

Page 2

Subject to the foregoing and the other matters set forth herein, it is our opinion that, as of the date hereof, when the Shares shall have been duly registered on the books of the transfer agent and registrar therefor in the name or on behalf of the purchasers, or certificates representing the Shares (in the form of the specimen certificate incorporated by reference as an exhibit to the Company’s most recent Annual Report on Form 10-K) have been manually signed by an authorized officer of the transfer agent and registrar therefor, and when the Shares have been issued by the Company against payment therefor (not less than par value) either in compliance with the provisions of the Warrants or in the circumstances contemplated by the Plans, assuming that the individual grants or awards under the Plans have been duly authorized by all necessary corporate action and exercised in accordance with the requirements of law and the Plans (and the agreements and awards duly adopted thereunder and in accordance therewith), the issue and sale of the Shares will have been duly authorized by all necessary corporate action of the Company, and the Shares will be validly issued, fully paid and nonassessable. In rendering the foregoing opinion, we have assumed that the Company will comply with all applicable notice requirements regarding uncertificated shares provided in the General Corporation Law of the State of Delaware.

This opinion is for your benefit in connection with the Registration Statement and may be relied upon by you and by persons entitled to rely upon it pursuant to the applicable provisions of the Act. We consent to your filing this opinion as an exhibit to the Registration Statement and to the reference to our firm in the Prospectus under the heading “Legal Matters.” In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Commission thereunder.

Very truly yours,

/s/ Latham & Watkins LLP

EX-23.1

Exhibit 23.1

Consent of Independent Registered Public Accounting Firm

Ligand Pharmaceuticals Incorporated

San Diego, California

We hereby consent to incorporation by reference in the Prospectus constituting a part of this Form S-3 Registration Statement of our reports dated February 28, 2008, relating to the consolidated financial statements and schedule and the effectiveness of internal control over financial reporting of Ligand Pharmaceuticals Incorporated appearing in the Company’s annual report on Form 10-K for the year ended December 31, 2008.

We also consent to the reference to us under the caption “Experts” in the Prospectus.

/s/ BDO Seidman, LLP

San Diego, California

May 19, 2009

EX-23.2

Exhibit 23.2

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We have issued our reports dated March 13, 2009, with respect to the consolidated financial statements, schedule, and internal control over financial reporting of Ligand Pharmaceuticals Incorporated appearing in the 2008 Annual Report on Form 10-K for the year ended December 31, 2008 which is incorporated by reference in this Registration Statement. We consent to the incorporation by reference in the Registration Statement of said reports and to the use of our name as it appears under the caption “Experts.”

/s/ GRANT THORNTON LLP

San Diego, California

May 19, 2009

COVER

	12636 High Bluff Drive, Suite 400 San Diego, California 92130-2071 Tel: +1.858.523.5400 Fax: +1.858.523.5450 www.lw.com
	FIRM / AFFILIATE OFFICES
May 20, 2009	Abu Dhabi Barcelona Brussels Chicago Doha Dubai Frankfurt Hamburg Hong Kong London Los Angeles Madrid Milan Moscow	Munich New Jersey New York Orange County Paris Rome San Diego San Francisco Shanghai Silicon Valley Singapore Tokyo Washington, D.C.

VIA EDGAR

Securities and Exchange Commission

100 F Street, N.E.

Washington, D.C. 20549

Re: Ligand Pharmaceuticals Incorporated - Registration Statement on Form S-3

Ladies and Gentlemen:

On behalf of Ligand Pharmaceuticals Incorporated (the “Company”), we transmit for filing with the Securities and Exchange Commission (the “Commission”) the Company’s Registration Statement on Form S-3 (the “Registration Statement”).

Please note that a written request for an order granting confidential treatment dated May 11, 2009, as amended by the letter to Jacob Fien-Helfman of the Commission dated May 15, 2009 (the “Confidential Treatment Request”), was previously sent to you on behalf of the Company. The Company will not request that the Commission declare the Registration Statement effective until the Commission’s review of the Confidential Treatment Request has been completed.

In connection with the Registration Statement, the Company has paid by wire transfer to the Commission a filing fee in the amount of $418.39.

If you have any questions regarding this filing, please contact the undersigned at (858) 523-3944.

Very truly yours,

/s/ Thomas J. Smith

Thomas J. Smith

cc: Scott N. Wolfe, Esq.