LBDD is based on an understanding of molecules (ligands) that are recognized to interact with a particular biological target. It uses data such as binding affinity and pharmacophore models to design new compounds with similar or improved activity. This approach is particularly useful when the structure of the target is unknown. Tools like QSAR (Quantitative Structure-Activity Relationship) and 3D pharmacophore modeling are commonly applied. LBDD plays a crucial role in enhancing lead compounds during the drug discovery process.