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                                                                  EXHIBIT 10.286

                               [Ligand Letterhead]

July 28, 2005

Mr. Taylor J. Crouch
Senior Vice President,
Regulatory Affairs and Compliance
LIGAND PHARMACEUTICALS INCORPORATED
10275 Science Center Drive
San Diego, CA  92121

Dear Taylor:

                  The purpose of this letter agreement is to document the terms
of the severance package to which you will be entitled should your employment
with Ligand Pharmaceuticals Incorporated (the "Company") terminate under certain
specified circumstances.

                  Part One of this letter agreement sets forth certain
definitional provisions to be in effect for purposes of determining your benefit
entitlements. Part Two specifies the terms and conditions upon which you may
become entitled to receive severance benefits. Severance benefits accrue under
this letter agreement in the event your employment with the Company were to be
terminated involuntarily in connection with certain changes in control of the
Company. Part Three concludes this letter agreement with a series of general
terms and conditions applicable to your severance benefits.

                             PART ONE -- DEFINITIONS

                  Definitions. For purposes of this letter agreement, including
in particular the application of the special benefit limitations of Part Three,
the following definitions will be in effect:

      1.    Average Compensation means your average W-2 wages from the Company
            for the five (5) calendar years completed immediately prior to the
            calendar year in which the Change in Control is effected. Any W-2
            wages for a partial year of employment will be annualized, in
            accordance with the frequency with which such wages are paid during
            such partial year, before inclusion within your Average
            Compensation.

      2.    Board means the Company's Board of Directors.

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Mr. Taylor J. Crouch
July 28, 2005
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      3.    Change in Control means any of the following events:

                  (i) a merger or consolidation in which the Company is not the
            surviving entity, except for a transaction the principal purpose of
            which is to change the state in which the Company is incorporated,

                  (ii) the sale, transfer or other disposition of all or
            substantially all of the assets of the Company other than in the
            ordinary course of business,

                  (iii) any reverse merger in which the Company ceases to exist
            as an independent corporation and becomes the subsidiary of another
            corporation, except where there is an insubstantial change in the de
            facto voting control of the Company (e.g. the creation of a holding
            company),

                  (iv) any Hostile Take-Over,

                  (v) the acquisition by any person (or related group of
            persons), whether by tender or exchange offer made directly to the
            Company's stockholders, private purchases from one or more of the
            Company's stockholders, open market purchases or any other
            transaction, of beneficial ownership of securities possessing more
            than thirty percent (30%) of the total combined voting power of the
            Company's outstanding securities,

                  (vi) the acquisition by any person (or related group of
            persons), whether by tender or exchange offer made directly to the
            Company's stockholders, private purchases from one or more of the
            Company's stockholders, open market purchases or any other
            transaction, of additional securities of the Company which increase
            the total holdings of such person (or group) to a level of
            securities possessing more than fifty percent (50%) of the total
            combined voting power of the Company's outstanding securities, or

                  (vii) the acquisition by any person (or related group of
            persons), whether by tender or exchange offer made directly to the
            Company's stockholders, private purchases from one or more of the
            Company's stockholders, open market purchases or any other
            transaction, of securities of the Company possessing sufficient
            voting power in the aggregate to elect an absolute majority of the
            members of the Board (rounded up to the nearest whole number).

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Mr. Taylor J. Crouch
July 28, 2005
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      4.    COBRA means the continuation-of-coverage provisions of the
            Consolidated Omnibus Budget Reconciliation Act of 1985, as amended.

      5.    Code means the Internal Revenue Code of 1986, as amended.

      6.    Common Stock means the Company's common stock, par value $0.001 per
            share.

      7.    Equity Incentive Plans means any of the following equity incentive
            plans of the Company: 1992 Stock Option/Stock Issuance Plan, the
            2002 Stock Incentive Plan, and the Restricted Stock Purchase Plan,
            together with any amendments or successors to such plans.

      8.    Equity Parachute Payment means, with respect to any Option (whether
            Acquisition-Accelerated or Severance-Accelerated) or unvested Stock
            Issuance, the portion deemed to be a parachute payment under Code
            Section 280G and the Treasury Regulations issued thereunder. Such
            Equity Parachute Payment shall be calculated in accordance with the
            valuation provisions established under Code Section 280G and the
            applicable Treasury Regulations and will include an appropriate
            dollar adjustment to reflect the lapse of your obligation to remain
            in the Company's employ as a condition to your vesting in the
            accelerated portion of such Option or Stock Issuance.

      9.    ERISA means the Employee Retirement Income Security Act of 1974, as
            amended.

      10.   Health Care Coverage means the health care benefits provided by the
            Company to you and your eligible dependents for which you are
            eligible to continue coverage under the provisions of COBRA.

      11.   Hostile Take-Over means either of the following events:

                  (i) the acquisition by any person (or related group of
            persons) whether by tender or exchange offer made directly to the
            Company's stockholders, private purchases from one or more of the
            Company's stockholders, open market purchases or any other
            transaction, of beneficial ownership of securities possessing more
            than thirty percent (30%) of the total combined voting power of the
            Company's outstanding securities pursuant to a tender offer made
            directly to the Company's

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Mr. Taylor J. Crouch
July 28, 2005
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            stockholders which the Board does not recommend such stockholders to
            accept, or

                  (ii) a change in the composition of the Board over a period of
            thirty-six (36) consecutive months or less such that a majority of
            the Board members (rounded up to the next whole number) ceases, by
            reason of one or more contested elections for Board membership, to
            be comprised of individuals who either (a) have been Board members
            continuously since the beginning of such period or (b) have been
            elected or nominated for election as Board members during such
            period by at least a majority of the Board members described in
            clause (a) who were still in office at the time such election or
            nomination was approved by the Board.

      12.   Involuntary Termination means the termination of your employment
            with the Company:

                  (i) upon your involuntary discharge or dismissal, or

                  (ii) upon your resignation in connection with any of the
            following changes to the terms and conditions of your employment:
            (A) a change in your position with the Company which materially
            reduces your level of responsibility, (B) a greater than ten percent
            (10%) reduction in your level of compensation (including base
            salary, fringe benefits and participation in non-discretionary bonus
            programs under which awards are payable pursuant to objective
            financial or performance standards, but excluding equity
            compensation) or (C) a relocation of your principal place of
            employment by more than fifty (50) miles.

                        The following guidelines shall determine whether one or
            more reductions in compensation should be taken into account for
            purposes of clause (ii)(B):

                        (a) Any reduction in compensation which occurs in
                  connection with an across-the-board reduction in the level of
                  compensation payable to the Company's executive officers or
                  senior management shall not constitute grounds for a clause
                  (ii)(B) resignation, unless implemented within eighteen (18)
                  months after a Change in Control.

                        (b) In the event of a Hostile Take-Over, the greater
                  than ten percent (10%) standard of clause (ii)(B) shall be
                  reduced to zero percent (0%) so that any reduction in the
                  level of your

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Mr. Taylor J. Crouch
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                  compensation shall constitute grounds for a clause (ii)(B)
                  resignation.

                        In no event shall an Involuntary Termination be deemed
            to occur should your employment terminate by reason of death or
            permanent disability.

      13.   Option means any option granted to you under any of the Equity
            Incentive Plans which is outstanding at the time of your Involuntary
            Termination or any earlier Change in Control. Your outstanding
            options are to be divided into two separate categories as follows:

                  (i) Acquisition-Accelerated Options: any outstanding Option
            (or installment thereof) which accelerates upon a Change in Control
            in accordance with the automatic acceleration provisions of the
            Equity Incentive Plans.

                  (ii) Severance-Accelerated Options: any outstanding Option (or
            installment thereof) which is not an Acquisition-Accelerated Option
            but which accelerates upon your Involuntary Termination, whether or
            not in connection with a Change in Control, as part of your
            severance benefits under this letter agreement.

      14.   Other Parachute Payments mean any payments in the nature of
            compensation to which you may become entitled under this letter
            agreement (other than the Equity Parachute Payment) or any other
            arrangement with the Company, to the extent such payments qualify as
            parachute payments within the meaning of Code Section 280G(b)(2) and
            the Treasury Regulations issued thereunder or would so qualify if
            the aggregate present value of such payments exceeded the amount
            specified in Code Section 280G(b)(2)(ii).

      15.   Stock Issuance means the issuance of unvested shares of Common Stock
            under the Company's Restricted Stock Plan or any other Equity
            Incentive Plan.

      16.   Termination for Cause means an Involuntary Termination or
            resignation of your employment with the Company by reason of your
            conviction of any felony or other criminal act, your commission of
            any act of fraud or embezzlement, your unauthorized use or
            disclosure of confidential or proprietary information or trade
            secrets of the Company or its subsidiaries, or any other intentional
            misconduct on your part which adversely affects the business or
            affairs of the Company in a material manner.

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Mr. Taylor J. Crouch
July 28, 2005
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                  PART TWO -- INVOLUNTARY TERMINATION BENEFITS

                  You will be entitled to receive the severance benefits
specified below should there occur an Involuntary Termination of your employment
during the term of this letter agreement effected in connection with a Change in
Control, other than a Termination for Cause. However, in the absence of a
Hostile Take-Over, these benefits will continue to be paid you only for so long
as you remain available for any consulting services required of you under Part
Two, Paragraph 4 and abide by the restrictive covenants set forth in Part Two,
Paragraph 5.

      1.    Severance Payments. You will receive severance payments from the
            Company for a period of twelve (12) months following your
            Involuntary Termination in an aggregate amount equal to the sum of
            (A) one (1) times the annual rate of base salary in effect for you
            at the time of your Involuntary Termination or at the time of the
            relevant Change in Control, whichever is higher plus (B) one (1)
            times the average of the bonuses (excluding any signing bonus) paid
            to you for services rendered in the two (2) fiscal years immediately
            preceding the fiscal year of your Involuntary Termination
            (annualized if paid for a partial fiscal year). If a bonus is paid
            to you for only one of those years, then the bonus amount under
            Clause (B) will be equal to one (1) times such bonus amount. The
            aggregate severance payments shall be paid to you in equal
            installments over the twelve-month period in accordance with the
            Company's normal payroll practices and subject to all applicable
            withholding taxes. The severance payments will immediately terminate
            if and only if (i) you should cease to remain available for the
            consulting services required of you under Section 4, or (ii) you
            fail to abide by the restrictive covenants set forth in Section 5 .
            However, in the event your Involuntary Termination occurs in
            connection with a Hostile Take-Over, your severance payments will be
            paid to you in the form of a single lump sum amount within thirty
            (30) days after such Involuntary Termination, and the provisions of
            Sections 4 and 5 of this Part Two will not apply.

      2.    Health Care Coverage. The Company will, at its expense, make any
            COBRA payments for you and your eligible dependents in order to
            continue your Health Care Coverage until the earlier of (i) twelve
            (12) months after the effective date of your Involuntary Termination
            (other than a Termination for Cause) or (ii) the first date that you
            are covered under another employer's (or, in the event of rehire,
            the Company's) health benefit program which provides substantially
            the same level of benefits without exclusion for pre-existing
            medical conditions. Such payments will be in lieu of any other
            continued health care coverage to

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Mr. Taylor J. Crouch
July 28, 2005
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            which you or your dependents would otherwise be entitled pursuant to
            the requirements of Code Section 4980B by reason of your termination
            of employment.

      3.    Option Acceleration and Lapse of Restrictions. Each of your
            outstanding Options under the Equity Incentive Plans will (to the
            extent not then otherwise exercisable) automatically accelerate so
            that each such Option will become immediately exercisable for the
            total number of shares of Common Stock at the time subject to that
            Option. Each such accelerated Option, together with all of your
            other vested Options, will remain exercisable for a period of twelve
            (12) months following your Involuntary Termination until the end of
            the specified ten (10)-year option term. Such Option(s) may be
            exercised for any or all of the option shares in accordance with the
            exercise provisions of the option agreement evidencing the grant. In
            addition, all restrictions applicable to the Stock Issuances you
            hold (to the extent those restrictions have not previously lapsed in
            accordance with the terms of the issuance agreements) will
            automatically lapse upon your Involuntary Termination (except a
            Termination for Cause).

      4.    Consulting Services. Unless your Involuntary Termination occurs in
            connection with a Hostile Take-Over, you will make yourself
            available to perform consulting services reasonably requested of you
            during the twelve (12)-month period following your Involuntary
            Termination. You will be compensated at an hourly rate to be agreed
            upon by you and the Company at the time such consulting services are
            to be rendered, and you will be reimbursed for all reasonable
            out-of-pocket expenses incurred in rendering such services upon your
            submission of appropriate documentation for those expenses.

      5.    Restrictive Covenants. For the one hundred twenty (120)-day period
            following your Involuntary Termination:

                  (i) You will not directly or indirectly, whether for your own
            account or as an employee, director, consultant or advisor, provide
            services to any business enterprise which is at the time in
            competition with any of the Company's then existing or formally
            planned product lines and which is located geographically in an area
            where the Company maintains substantial business activities, unless
            you obtain the prior written consent of the Board of Directors.

                  (ii) You will not directly or indirectly encourage or solicit
            any individual to leave the Company's employ for any reason or
            interfere in any other manner with the employment relationships at
            the time existing between the Company and its current or prospective
            employees.

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                  (iii) You will not induce or attempt to induce any customer,
            supplier, distributor, licensee or other business relation of the
            Company to cease doing business with the Company or in any way
            interfere with the existing business relationship between any such
            customer, supplier, distributor, licensee or other business relation
            and the Company.

            You acknowledge that monetary damages may not be sufficient to
            compensate the Company for any economic loss which may be incurred
            by reason of your breach of the foregoing restrictive covenants.
            Accordingly, in the event of any such breach, the Company shall, in
            addition to the cessation of the severance benefits provided you
            under this letter agreement and any remedies available to the
            Company at law, be entitled to obtain equitable relief in the form
            of an injunction precluding you from continuing to engage in such
            breach.

            None of the foregoing restrictive covenants in this section 5 shall
            be applicable in the event your Involuntary Termination occurs in
            connection with a Hostile Take-Over.

      6.    Benefit Reduction.

                  (i) Benefit Reduction. If the Change in Control does not
            constitute a Hostile Take-Over, first the dollar amount of your
            severance payment under Paragraph 1 will be reduced to the extent
            necessary to assure that the present value of those benefits will
            not, when added to the present value of your Equity Parachute
            Payment and your Other Parachute Payments, exceed 2.99 times your
            Average Compensation. In the event of a Hostile Take-Over, no
            reduction will be made to your severance payment (or any other
            benefit to which you become entitled hereunder), unless necessary to
            provide you with the maximum after-tax benefit available, after
            taking into account any parachute excise tax which might otherwise
            be payable by you under Code Section 4999 and any analogous State
            income tax provision.

                  (ii) Resolution of Disputes. In the event there is any
            disagreement between you and the Company as to whether one or more
            benefits to which you become entitled (whether under this letter
            agreement or otherwise) in connection with a Change in Control
            constitute Equity Parachute Payments or Other Parachute Payments,
            such dispute is to be resolved as follows:

                        A. The matter shall be submitted for resolution to
            independent counsel mutually acceptable to you and the Company
            ("Independent Counsel").

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Mr. Taylor J. Crouch
July 28, 2005
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            The resolution reached by Independent Counsel shall be final and
            controlling. However, should the Independent Counsel determine that
            the status of the benefits in dispute can be resolved by obtaining a
            private letter ruling from the Internal Revenue Service, a formal
            and proper request for such ruling shall be prepared and submitted
            by Independent Counsel, and the determination made by the Internal
            Revenue Service in the issued ruling shall be controlling. All
            expenses incurred in connection with the retention of Independent
            Counsel and (if applicable) the preparation and submission of the
            ruling request shall be paid by the Company.

                        B. The present value of each Equity Parachute Payment
            and each of the Other Parachute Payments (including your severance
            payment and Health Care Coverage) shall be determined in accordance
            with the provisions of Code Section 280G(d)(4) and the Treasury
            Regulations issued thereunder.

            The full amount of your severance benefit under Paragraph 1 shall
            not be paid to you until any amounts in dispute under this Paragraph
            6(ii) have been resolved in accordance herewith. However, any
            portion of such severance payment which would not otherwise exceed
            the benefit limitation of Paragraph 6(i) even if all amounts in
            dispute under this Paragraph 6(ii) were to be resolved against you
            will be paid to you in accordance with the applicable provisions of
            this letter agreement.

                  (iii) Overriding Limitation. You will in all events be
            entitled to receive the full amount of your severance payment under
            Paragraph 1, to the extent those benefits, when added to the present
            value of your Equity Parachute Payment and your Other Parachute
            Payments (excluding such severance payment), will nevertheless
            qualify as reasonable compensation within the standards established
            under Code Section 280G(b)(4).

                  (iv) Interpretation. The provisions of this Section 6 shall in
            all events be interpreted in such manner as will avoid the
            imposition of excise taxes under Code Section 4999, and the
            disallowance of deductions under Code Section 280G(a), with respect
            to your severance benefits under this letter agreement.

                     PART THREE -- MISCELLANEOUS PROVISIONS

      1.    Termination for Cause. Should your termination constitute a
            Termination for Cause, then the Company shall only be required to
            pay you (i) any unpaid compensation earned for services previously
            rendered through the date of such termination and (ii) any accrued
            but unpaid vacation benefits or sick days, (iii)

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Mr. Taylor J. Crouch
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            any reimbursements then owed to you by the Company and no benefits
            will be payable to you under this letter agreement.

      2.    Term of Agreement. The provisions of this letter agreement will
            continue in effect for a period of five (5) years from the date
            hereof.

      3.    General Creditor Status. The benefits to which you may become
            entitled under this letter agreement (except those attributable to
            your Options or Stock Issuances) will be paid, when due, from the
            general assets of the Company. Your right (or the right of the
            executors or administrators of your estate) to receive any such
            payments will at all times be that of a general creditor of the
            Company and will have no priority over the claims of other general
            creditors of the Company.

      4.    Death. Should you die before receipt of all benefits to which you
            become entitled under this letter agreement, then the payment of
            such benefits will be made, on the due date or dates hereunder had
            you survived, to the executors or administrators of your estate.
            Should you die before you exercise your Severance-Accelerated
            Options (if any) or any other of your outstanding vested Options,
            then each such Option may be exercised, during the applicable
            exercise period in effect hereunder for those options at the time of
            your death, by the executors or administrators of your estate or by
            person to whom the Option is transferred pursuant to your will or in
            accordance with the laws of inheritance.

      5.    Miscellaneous. The provisions of this letter agreement will be
            construed and interpreted under ERISA. To the extent ERISA is
            inapplicable, then the laws of the State of California shall
            control, without regard to that state's choice of law provisions.
            This letter agreement incorporates the entire agreement between you
            and the Company relating to the subject of severance benefits and
            supersedes all prior agreements and understandings with respect to
            such subject matter. This letter agreement may only be amended by
            written instrument signed by you and another duly-authorized officer
            of the Company. If any provision of this letter agreement as applied
            to any party or to any circumstance should be adjudged by an
            arbitrator or court of competent jurisdiction to be void or
            unenforceable for any reason, the invalidity of that provision shall
            in no way affect (to the maximum extent permissible by law) the
            application of such provision under circumstances different from
            those so adjudicated, the application of any other provision of this
            letter agreement, or the enforceability or invalidity of this letter
            agreement as a whole. Should any provision of this letter agreement
            become or be determined to be invalid, illegal or unenforceable in
            any jurisdiction by reason of the scope, extent or duration of

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Mr. Taylor J. Crouch
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            its coverage, then such provision shall be deemed amended to the
            extent necessary to conform to applicable law so as to be valid and
            enforceable or, if such provision cannot be so amended without
            materially altering the intention of the parties, then such
            provision shall be stricken and the remainder of this letter
            agreement shall continue in full force and effect.

      6.    Remedies. All rights and remedies provided pursuant to this letter
            agreement or by law will be cumulative, and no such right or remedy
            will be exclusive of any other. A party may pursue any one or more
            rights or remedies hereunder or may seek damages or specific
            performance in the event of another party's breach hereunder or may
            pursue any other remedy by law or equity, whether or not stated in
            this letter agreement.

      7.    Arbitration. Any controversy which may arise between you and the
            Company with respect to the construction, interpretation or
            application of any of the terms, provisions or conditions of this
            letter agreement or any monetary claim arising from or relating to
            this letter agreement will be submitted to and exclusively decided
            by final and binding arbitration in San Diego, California in
            accordance with the rules of the American Arbitration Association
            then in effect.

      8.    No Employment or Service Contract. Nothing in this letter agreement
            shall confer upon you any right to continue in the employment of the
            Company for any period of specific duration or interfere with or
            otherwise restrict in any way the rights of the Company or you,
            which rights are hereby expressly reserved by each, to terminate
            your employment at any time for any reason whatsoever, with or
            without cause.

      9.    Proprietary Information. You hereby acknowledge that the Company
            may, from time to time during your employment with the Company,
            disclose to you confidential information pertaining to the Company's
            business and affairs. All information and data, whether or not in
            writing, of a private or confidential nature concerning the business
            or financial affairs of the Company is and will remain subject to a
            separate Proprietary Information and Inventions Agreement (or the
            like) between you and the Company.

                  Please indicate your acceptance of the foregoing provisions of
this severance agreement by signing the enclosed copy of this letter agreement
and returning it to the Company.

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Mr. Taylor J. Crouch
July 28, 2005
Page 12

Very truly yours,

LIGAND PHARMACEUTICALS INCORPORATED

/s/ David E. Robinson

David E. Robinson
Chairman, President and CEO

DER:bjo
agree\Severance Crouch 07.28.05

ACCEPTED BY AND AGREED TO

Signature:  /s/ Taylor J. Crouch
            Taylor J. Crouch

Dated: 8/18/05