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UNITED STATES

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): December 17, 2009

LIGAND PHARMACEUTICALS INCORPORATED

(Exact name of registrant as specified in its charter)

Delaware	001-33093	77-0160744
(State or other jurisdiction of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

11085 North Torrey Pines Road, Suite 300, La Jolla, California, 92037

(Address of principal executive offices) (Zip Code)

(858) 550-7500

(Registrant’s telephone number, including area code)

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

x Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01. Entry into a Material Definitive Agreement

As previously announced, on August 23, 2009, Ligand Pharmaceuticals Incorporated (“Ligand”) entered into an Agreement and Plan of Merger (the “Merger Agreement”), with Neurogen Corporation, a Delaware corporation (“Neurogen”) and Neon Signal, LLC, a direct wholly-owned subsidiary of Ligand (“Merger Sub”). Under the Merger Agreement, Ligand would acquire Neurogen pursuant to a reverse triangular merger, whereby Merger Sub would merge with and into Neurogen, with Neurogen as the surviving corporation (the “Merger”).

As previously announced, the Merger Agreement was amended on September 18, 2009 by an Amendment to Agreement and Plan of Merger to clarify the definition of the defined term “Target Net Cash Amount,” and on November 2, 2009 by an Amendment No. 2 to Agreement and Plan of Merger, amending the Merger Agreement by changing the defined term “Outside Date” to mean December 24, 2009.

On December 17, 2009, Ligand, Neurogen and Merger Sub entered into Amendment No. 3 to Agreement and Plan of Merger, amending the Merger Agreement by adding $600,000 cash as additional merger consideration for the Neurogen stockholders and by eliminating Neurogen’s right to terminate the Merger Agreement if the indicated aggregate value of the shares of Ligand common stock to be issued in the merger, after giving effect to the 4,200,000-share cap, would be less than the Adjusted Reference Amount. Amendment No. 3 also specified the Determination Date to be December 15, 2009 and changed the Outside Date to December 31, 2009.

Additional Information and Where to Find It

The SEC has declared effective Ligand’s Registration Statement on Form S-4, which includes a proxy statement of Neurogen and other materials relevant to the proposed merger and related transactions. The Registration Statement and related Neurogen proxy statement, and any other documents filed by Ligand or Neurogen with the SEC, may be obtained free of charge at the SEC’s web site at www.sec.gov. In addition, investors and security holders may obtain free copies of the documents filed with the SEC by Ligand by going to Ligand’s Investor Relations website page at www.ligand.com.

Item 9.01 Financial Statements and Exhibits

The following exhibits are attached to this Current Report on Form 8-K:

(d) Exhibits.

Exhibit No.	Description
10.1	Amendment No. 3 to Agreement and Plan of Merger, by and among Ligand Pharmaceuticals Incorporated, Neurogen Corporation, and Neon Signal, LLC, dated December 17, 2009
99.1	Press release, dated December 17, 2009

SIGNATURES

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

	LIGAND PHARMACEUTICALS INCORPORATED
Date: December 17, 2009	By:	/s/    CHARLES S. BERKMAN
	Name:	Charles S. Berkman
	Title:	Vice President, General Counsel and Secretary

EXHIBIT INDEX

Exhibit No.	Description
10.1	Amendment No. 3 to Agreement and Plan of Merger, by and among Ligand Pharmaceuticals Incorporated, Neurogen Corporation, and Neon Signal, LLC, dated December 17, 2009
99.1	Press release, dated December 17, 2009

EX-10.1

Exhibit 10.1

AMENDMENT NO. 3 TO AGREEMENT AND PLAN OF MERGER

THIS AMENDMENT NO. 3 TO AGREEMENT AND PLAN OF MERGER (this “Amendment”) is made and entered into as of December 17, 2009, by and among LIGAND PHARMACEUTICALS INCORPORATED, a Delaware corporation (“Parent”); NEON SIGNAL, LLC, a Delaware limited liability company and a wholly-owned Subsidiary of Parent (“Merger Sub”); and NEUROGEN CORPORATION, a Delaware corporation (the “Company”). This Amendment is made with regard to the Agreement and Plan of Merger dated August 23, 2009, by and among Parent, Merger Sub and the Company (as previously amended, the “Agreement”).

1. The Agreement is hereby amended by changing the definition of “Determination Date” in Article I of the Agreement to read in full as follows:

“Determination Date” shall mean December 15, 2009.

2. The Agreement is hereby amended by changing Section 2.06(a)(iii) of the Agreement to read in full as follows:

(iii) except as provided in clauses (i) and (ii) above, each issued and outstanding Company Share (other than Dissenting Shares) shall be converted, subject to Section 2.09, into the right to receive (A) a portion of a validly issued, fully paid and nonassessable share of common stock, par value $0.001 per share, of Parent equal to the Exchange Ratio, including the associated rights under the Parent Rights Agreement (the “Parent Common Stock”); provided, that the maximum number of shares of Parent Common Stock that Parent shall be required to issue pursuant to this Section 2.06(a)(iii) shall not exceed the Maximum Amount, (B) in the event the Aplindore Program is sold by the Company before the Effective Time, an amount in cash and/or a number of shares of third-party stock, as the case may be, equal to the Aplindore Program Consideration which has been received as of the Effective Time divided by the total number of Outstanding Company Shares, (C) in the event the Real Estate is sold by the Company before the Effective Time, an amount in cash equal to the Real Estate Consideration which has been received as of the Effective Time divided by the total number of Outstanding Company Shares, (D) one Aplindore CVR (unless the Aplindore Program is sold by and all proceeds thereof are received by the Company before the Effective Time, or the Aplindore Program is terminated by the Company before the Effective Time), (E) one H3 CVR, (F) one Merck CVR, (G) one Real Estate CVR (unless the Real Estate is sold by and all proceeds thereof are received by the Company before the Effective Time), and (H) an amount in cash equal to $600,000 divided by the total number of Outstanding Company Shares (collectively, the “Merger Consideration”);

3. The Agreement is hereby amended by changing the first sentence of Section 2.08(a) of the Agreement to read in full as follows:

Before the Effective Time: (i) Parent shall select a bank or trust company (reasonably acceptable to the Company) to act as exchange agent with respect to the payment of the Merger Consideration (the “Exchange Agent”); and (ii) Parent (or, as applicable, the Company) shall deposit with the Exchange Agent the Section 2.06(a)(iii)(H) cash component of the Merger Consideration, certificates representing the shares of Parent Common Stock, the Aplindore Program Consideration (to the extent already received by the Company) in the event the Aplindore Program is sold by the Company at or before the Effective Time, the Real Estate Consideration (to the extent already received by the Company) in the event the Real Estate is sold by the Company at or before the Effective Time, sufficient to enable the Exchange Agent to make payments pursuant to Section 2.06 and Section 2.09 to the holders of Outstanding Company Shares.

4. The Agreement is hereby amended by changing Section 7.01(b) of the Agreement to read in full as follows:

(b) by either Parent or the Company if the Company Stockholder Approval shall not have been obtained by reason of the failure to obtain the required vote at the Special Meeting or at any postponement or adjournment thereof by December 31, 2009;

5. The Agreement is hereby amended by changing Section 7.01(c) of the Agreement to read in full as follows:

(c) by Parent or the Company at any time after December 31, 2009 (the “Outside Date”) if the Effective Time shall not have occurred on or before the Outside Date (provided that the right to terminate this Agreement pursuant to this Section 7.01(c) shall not be available to any party where the failure of such party (or any Affiliate or Representative of such party) to fulfill any obligation under this Agreement or any voting agreement has resulted in the failure of the Effective Time to have occurred on or before the Outside Date;

6. The Agreement is hereby amended by deleting Section 7.01(i) of the Agreement.

7. The Agreement is hereby amended by changing Section 7.03(b) of the Agreement to read in full as follows:

(b) If this Agreement is validly terminated by Parent pursuant to Section 7.01(e), then, within two (2) Business Days after such termination, the Company shall pay the Termination Fee to Parent.

8. Except as expressly set forth herein, the Agreement remains unchanged and in full force and effect.

9. This Amendment may be executed in counterparts, each of which shall be deemed to be an original, and all of which taken together shall be deemed to constitute one and the same instrument. The parties agree that delivery of an executed counterpart of a signature page of this Amendment electronically or by facsimile shall be effective as delivery of a manually executed counterpart of this Amendment.

IN WITNESS WHEREOF, Parent, Merger Sub and the Company have caused this Amendment No. 3 to be executed as of the date first written above.

LIGAND PHARMACEUTICALS INCORPORATED
By:	/s/ John L. Higgins
Name:	John L. Higgins
Title:	CEO and President
NEON SIGNAL, LLC
By:	Ligand Pharmaceuticals Incorporated, its Member-Manager
	By:	/s/ John L. Higgins
	Name:	John L. Higgins
	Title:	CEO and President
NEUROGEN CORPORATION
By:	/s/ Steve Davis
Name:	Steve Davis
Title:	President & CEO

EX-99.1

Exhibit 99.1

Ligand Contacts:
Ligand Pharmaceuticals Incorporated	Lippert/Heilshorn & Associates
John L. Higgins, President and CEO	Don Markley
Erika Luib, Investor Relations	dmarkley@lhai.com
(858) 550-7896	(310) 691-7100

Neurogen Contacts:

Neurogen Corporation

Steve Davis, President and CEO

Diane Hoffman, Investor Relations

(203) 488-8201

LIGAND AND NEUROGEN AMEND MERGER AGREEMENT

Neurogen Stockholders Meeting to be held December 23, 2009

SAN DIEGO, CA and Branford, CT (December 17, 2009) – Ligand Pharmaceuticals Incorporated (NASDAQ: LGND) and Neurogen Corporation (NASDAQ: NRGN) announced today they have amended their merger agreement to increase the merger consideration payable. In addition to issuing 4.2 million shares of Ligand common stock (the maximum number allowed by the original agreement) and four series of contingent value rights, Ligand will now also pay $600,000 cash to Neurogen stockholders upon closing of the transaction.

The amendment also removes the right of Neurogen to terminate the transaction if the indicated value of the 4.2 million shares of Ligand common stock was less than a defined threshold value.

The Neurogen stockholders meeting called to consider the merger has been postponed to 10:00 a.m. EST on Wednesday, December 23, 2009 at 45 Northeast Industrial Road, Branford, Connecticut. Assuming the stockholders vote in favor of the merger, the transaction is expected to close on December 23, 2009.

About Ligand Pharmaceuticals

Ligand discovers and develops new drugs that address critical unmet medical needs of patients with muscle wasting, frailty, hormone-related diseases, osteoporosis, inflammatory diseases, anemia, asthma, rheumatoid arthritis and psoriasis. Ligand’s proprietary drug discovery and development programs are based on advanced cell-based assays, gene-expression tools, ultra-high throughput screening and one of the world’s largest combinatorial chemical libraries. Ligand has strategic alliances with major pharmaceutical and biotechnology companies, including Bristol-Myers Squibb, Celgene, Cephalon, GlaxoSmithKline, Merck and Pfizer. With more than 20 molecules in various stages of development, Ligand utilizes proprietary technologies for identifying drugs with novel receptor and enzyme drug targets.

About Neurogen

Based in Branford, Connecticut, Neurogen Corporation is a drug development company historically focusing on small-molecule drugs to improve the lives of patients suffering from psychiatric and neurological disorders with significant unmet medical need. Neurogen has conducted its drug development independently and, when advantageous, collaborated with world-class pharmaceutical companies to access additional resources and expertise.

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Forward-Looking Statements

This release contains forward-looking statements that involve risks and uncertainties. Ligand and Neurogen caution readers that any forward-looking information is not a guarantee of future performance and actual results could differ materially from those contained in the forward-looking information. Words such as “expect,” “estimate,” “project,” “potential,” and similar expressions are intended to identify such forward-looking statements. Such forward-looking statements include, but are not limited to, the expected timing of closing the merger and other statements that are not historical facts. Among the important factors that could cause actual results to differ materially from those in any forward-looking statements are the risks that Merck may not advance the VR1 program successfully; the risk that Neurogen’s real estate or the Aplindore program may not be sold and that the conditions of the H3 and Merck CVR’s may not be met in order to produce proceeds for the CVR holders; the anticipated synergies and benefits from the transaction may not be fully realized or may take longer to realize than expected; failure of Neurogen’s stockholders to approve the merger; Ligand or Neurogen inability to satisfy the conditions of the merger, or that the merger is otherwise delayed or ultimately not consummated; Neurogen product candidates may have unexpected adverse side effects or inadequate therapeutic efficacy; and positive results in clinical trials may not be sufficient to obtain FDA approval. There can be no assurance that any product in Ligand’s, Neurogen’s or the projected combined company’s product pipeline will be successfully developed or manufactured, that final results of clinical studies will be supportive of regulatory approvals required to market licensed products, or that any of the forward-looking information provided herein will be proven accurate. Additional important factors that may affect future results are detailed in Ligand’s and Neurogen’s filings with the Securities and Exchange Commission (the “SEC”), including each company’s recent filings on Forms 10-K and 10-Q, or in information disclosed in public conference calls, the date and time of which are released beforehand. Each of Ligand and Neurogen disclaims any intent or obligation to update these forward-looking statements beyond the date of this release.

Additional Information and Where to Find It

Ligand has filed with the SEC a Registration Statement on Form S-4, which includes a proxy statement of Neurogen and other relevant materials in connection with the proposed transaction. The proxy statement also constitutes a Ligand prospectus, which has been mailed to the stockholders of Neurogen. Investors and security holders of Neurogen are urged to read the proxy statement and the other relevant materials because they contain important information about Ligand, Neurogen and the proposed transaction. The proxy statement and other relevant materials, and any other documents filed by Ligand or Neurogen with the SEC, may be obtained free of charge at the SEC’s web site at www.sec.gov. In addition, investors and security holders may obtain free copies of the documents filed with the SEC by Ligand by going to the Investor Relations page on Ligand’s corporate website at www.ligand.com. Investors and security holders may obtain free copies of the documents filed with the SEC by Neurogen by going to the Investor Relations page on Neurogen’s corporate website at www.neurogen.com. Investors and security holders of Neurogen are urged to read the proxy statement and the other relevant materials before making any voting or investment decision with respect to the proposed transaction.

Ligand and its directors and executive officers may be deemed to be participants in the solicitation of proxies from the stockholders of Neurogen in favor of the proposed transaction. Information concerning Ligand’s directors and executive officers is set forth in Ligand’s proxy statement for its 2009 annual meeting of shareholders, which was filed with the SEC on April 29, 2009, and annual report on Form 10-K filed with the SEC on March 16, 2009.

Neurogen and its directors and executive officers may be deemed to be participants in the solicitation of proxies from the stockholders of Neurogen in favor of the proposed transaction. Information about Neurogen’s executive officers and directors and their ownership

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of Neurogen common stock is set forth in Neurogen’s amended annual report on Form 10-K filed with the SEC on April 30, 2009. Investors and security holders may obtain more detailed information regarding the direct and indirect interests of Neurogen and its executive officers and directors in the acquisition by reading the proxy statement regarding the merger, which has been filed with the SEC.

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