The reaction of 2-naphthalenethiol (I) with 2-methyleneglutaronitrile (II) followed by treatment first with concentrated hydrochloric acid and then with p-toluenesulfonic acid in methanol gives racemic acid, which is resolved into optically pure (R)-4-methoxycarbonyl-2-(2-naphthylthiomethyl)butyric acid (IV) by use of (R)-(+)-alpha-methylbenzylamine (III). The treatment of compound (IV), first with thionyl chloride and then with N-(3-methoxypropyl)-N-pentylamine (V), affords (R)-methyl 4-[N-(3-methoxypropyl)-N-pentylcarbamoyl]-5-(2-naphthylthio)pentanoate (VI). Oxidation of compound (VI) with m-chloroperbenzoic acid followed by treatment with 1N sodium hydroxide gives (R)-4-[N-(3-methoxypropyl)-N-pentylcarbamoyl]-5-(2-naphthylsulfonyl) pentanoic acid (VII), which is finally converted into KSG-504 by treatment with L-arginine.