Royal Pharmaceutical Corp. will move operations out of Utah as part of a deal to sell more than half of the company to LIDAK Biopharmaceuticals of La Jolla, Calif.

Both firms have signed a letter of intent to sell 55 percent equity interest in Royal. Officials said the arrangement will provide the financial backing Royal needs to develop its patented anti-viral/anti-inflammatory compound, R-30B.The deal calls for Royal to transfer its operations to La Jolla adjacent to the extensive research facilities of Medical Biology Institute with which LIDAK has a strategic alliance. MBI is a fully developed biomedical, non-profit research institution with a world-class research staff having state-of-the-art expertise spanning the sciences of immunology, molecular biology and genetics.

"I don't like to see it go this route, but our funding came from out-of-state so we had to move," said Royal President and Chief Executive Stephen Gibbons.

He said the research firm's six-person staff will not join LIDAK, but Royal will remain a publicly traded company. Former Royal staffers will go their separate ways to develop more products, Gibbons said.

The letter of intent, which is non-binding, contemplates that a definitive agreement will be completed and the transaction closed, by March 31, 1989.