8-K

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                 ---------------



                                    FORM 8-K

                                 CURRENT REPORT




     Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

       Date of Report (Date of earliest event reported): October 19, 2006

                       LIGAND PHARMACEUTICALS INCORPORATED
             (Exact name of registrant as specified in its charter)

                                    DELAWARE
                 (State or other jurisdiction of incorporation)

                                    000-20720
                            (Commission File Number)

                           10275 SCIENCE CENTER DRIVE,
                              SAN DIEGO, CALIFORNIA
                    (Address of principal executive offices)

                                 (858) 550-7500
              (Registrant's telephone number, including area code)

                                   77-0160744
                      (I.R.S. Employer Identification No.)

                                   92121-1117
                                   (Zip Code)









ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.


SEVERANCE AGREEMENTS

         On October 19, 2006, pursuant to authorization of the Compensation
Committee of the Board of Directors, the Company entered into additional
severance and retention agreements with Tod G. Mertes, Vice President,
Controller and Treasurer and Taylor J. Crouch, Senior Vice President, Operations
& President, International, as additional retention incentives.

         These additional agreements consist of:

     o   An "ordinary" severance agreement for Mr. Crouch that applies
         regardless of a change of control ("Ordinary Severance Agreement"). The
         Ordinary Severance Agreement provides for payment of six months salary
         in the event Mr. Crouch's employment is terminated without cause,
         regardless of a change of control. This agreement is on the form
         previously filed with the Commission on August 30, 2006 as Exhibit 10.2
         to the Company's Current Report on Form 8-K.

     o   A key employee retention bonus agreement with Mr. Crouch that provides
         for a cash bonus payment to him of $50,000 provided he remains employed
         by the Company and in good standing through December 31, 2006. This
         agreement is on the form previously filed with the Commission on March
         1, 2006 as Exhibit 10.1 to the Company's Current Report on Form 8-K.

     o   A Letter Agreement with Mr. Mertes providing for (i) the payout of
         severance benefits under current severance agreements with Mr. Mertes
         and (ii) the payout of any bonus due in accordance with the 2006
         Executive Bonus Plan, upon any termination or resignation of his
         employment, provided he remains with the Company and in good standing
         through the final filing of the 2006 annual report on Form 10-K.


         The foregoing descriptions of these agreements do not purport to be
complete and are qualified in their entirety by reference to such agreements. A
copy of the form of Mr. Mertes' Letter Agreement is filed as Exhibit 10.1 hereto
and a copy of the form of Mr. Crouch's agreements were previously filed as
detailed above, each of which is incorporated by reference herein.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS

(d)      Exhibits

EXHIBIT NUMBER             DESCRIPTION
- -----------------          --------------------

10.1                       Form of Letter Agreement by and between the Company
                           and Tod G. Mertes dated as of October 19, 2006




                                   SIGNATURES

         Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has caused this report to be signed on its behalf by the
undersigned.


                               LIGAND PHARMACEUTICALS INCORPORATED




    Date : October 20, 2006    By:      /s/  Warner R. Broaddus
                                        ________________________________________
                               Name:    Warner R. Broaddus
                               Title:   Vice President, General Counsel &
                                        Secretary

EX-10

{LIGAND LOGO]                                                       EXHIBIT 10.1





19 October 2006

Tod G. Mertes
608 The Strand
Oceanside, CA  92054

Dear Tod:

         This letter is to memorialize the agreement between you and the
Company, effective as of the date of this letter, regarding your retention.
Provided that you (a) are continuously employed by the Company and available for
work (except normal holidays and approved paid time off) (b) maintain a
performance rating of fully meets expectations (FME) or better and (c) are not
subject to any disciplinary action or performance improvement program, in each
case from the date of this letter, up to and including the filing date with the
SEC of the Company's annual report on Form 10-K for fiscal 2006 then: (i)
notwithstanding any contrary provision of your Severance Letter Agreement dated
August 25, 2006 and your Executive Change-of-Control Agreement dated May 20,
2003, you will be entitled to receive the full severance benefits of those
agreements upon any termination of your employment after such filing date,
including your resignation/voluntary termination as well as an Involuntary
Termination and regardless of any Change of Control, but not including any
Termination for Cause and (ii) you will be entitled to receive a bonus for
calendar year 2006, determined in accordance with the Company's 2006 Executive
Bonus Plan (Tier I); this bonus will be paid to you at the earliest time paid to
other Tier I executives, or upon your resignation or termination (other than a
Termination for Cause), whichever is earlier.

         For clarity you and Ligand agree that, pursuant to the consulting
arrangement terms of your Executive Change-of-Control Agreement, following a
termination or resignation covered by this letter you will be available at
reasonable times at the Company's offices for consultation services with the
Company, including but not limited to assistance with any review and comment
process with the SEC regarding the above-referenced Form 10-K.

Sincerely
LIGAND PHARMACEUTICALS, INC.
By:                                          ACCEPTED AND AGREED:
                                             --------------------

/s/  Hank Blissenbach

Henry F. Blissenbach                         /S/  TOD G. MERTES
Chairman and interin CEO                     --------------------------




LIGAND PHARMACEUTICALS INC., 10275 Science Center Drive, San Diego, CA
92121-1117 (858) 550-7500     fax  (858) 550-1825