Lexicon Pharmaceuticals, Inc. (Nasdaq: LXRX), today reported
financial results for the three months and full-year ended December
31, 2019 and provided a business update.
“In 2019, we achieved continued growth in our
XERMELO (telotristat ethyl) business of nearly 25% year-over-year
and made significant strides in advancing pipeline initiatives such
as telotristat ethyl in biliary tract cancer and LX9211 in
neuropathic pain,” said Lonnel Coats, Lexicon’s president and chief
executive officer. “We expect initial clinical efficacy data for
telotristat ethyl in biliary tract cancer by the end of this year.
As for LX9211, we are initiating a proof-of-concept study in
diabetic peripheral neuropathic pain in the first half of this
year.”
“We received a response yesterday from the
Center for Drug Evaluation and Research (CDER) to our appeal of the
FDA’s complete response letter (CRL) for sotagliflozin in type 1
diabetes,” continued Mr. Coats. “The response confirmed the
CRL decision, and we are now evaluating the feedback they provided
in their response."
“We are engaged in discussions around potential
partnerships for sotagliflozin, which will be necessary to enable
completion of the long-term outcomes studies, SCORED and SOLOIST,
that are designed to demonstrate benefits in and support labeling
for heart failure and chronic kidney disease.”
Fourth Quarter and Full-Year 2019
Product and Pipeline Highlights
XERMELO® (telotristat
ethyl)
- XERMELO U.S. net sales were $31.0 million in 2019.
- In December, Lexicon completed a safety review of the initial
safety run-in cohort of The Telotristat
Ethyl for Advanced
Biliary Tract Cancer, or
TELE-ABC, study, a Phase 2a clinical study of telotristat ethyl in
patients with biliary tract cancer. Safety analysis from the first
six patients who completed at least a 21-day cycle of treatment
with telotristat ethyl in combination with cisplatin and
gemcitabine supported the continuation of enrollment with no
adjustment in the telotristat ethyl 500 mg three times daily dosing
regimen.
Zynquista™ (sotagliflozin)
- In December, Lexicon announced topline data from the Phase 3
SOTA-EMPA study of sotagliflozin in type 2 diabetes. Sotagliflozin
400 mg achieved the primary endpoint of superiority on A1C
reduction versus placebo at Week 26 in patients with inadequate
glycemic control while on a dipeptidyl peptidase 4 inhibitor, with
or without metformin therapy. Sotagliflozin 400mg also achieved the
key secondary endpoint of noninferiority versus empagliflozin on
A1C reduction from baseline at Week 26. Sotagliflozin was generally
well tolerated, with safety results comparable to previously
reported safety results in patients with type 2
diabetes.
- In December, Lexicon announced that the U.S. Food and Drug
Administration’s (FDA) Office of New Drugs had reiterated the FDA's
prior position that the New Drug Application for sotagliflozin in
type 1 diabetes cannot be approved in its present form and denied
the appeal of the previously issued CRL. Lexicon subsequently
appealed the decision to CDER. As indicated above, CDER yesterday
reaffirmed the FDA’s position.
LX9211
- Lexicon announced positive topline Phase 1 data for LX9211 in a
multiple ascending dose study in healthy volunteers that
demonstrated a favorable safety and pharmacokinetics profile
supportive of once-daily dosing.
Fourth Quarter and Full-Year 2019
Financial Highlights
Unless otherwise stated, all comparisons are for
the fourth quarter and full year of 2019 compared to the fourth
quarter and full year of 2018.
Revenues: Revenues for the
fourth quarter decreased to $8.7 million from $17.1 million for the
corresponding period in 2018, primarily due to lower revenues
recognized under collaboration and license agreements. Full-year
2019 revenues increased to $322.1 million from $63.2 million,
primarily due to collaboration revenues recognized from the
termination of the alliance with Sanofi and recognition of
remaining amounts allocated to the performance obligations from the
initial Sanofi collaboration agreement for development activities
relating to sotagliflozin, as well as an increase from net product
revenue. Net product revenues for full-year 2019 included $31.0
million and $1.3 million, respectively, from net sales of XERMELO
in the U.S. and the sale of bulk tablets to Lexicon’s collaborator,
Ipsen.
Cost of Sales: Cost of sales
related to sales of XERMELO was $0.7 million and $0.6 million,
respectively, for the fourth quarter of 2019 and 2018. Full-year
2019 and 2018 cost of sales was $3.2 million and $2.5 million,
respectively.
Research and Development (R&D)
Expenses: Research and development expenses for the fourth
quarter increased to $40.6 million from $12.3 million for the
corresponding period in 2018, primarily due to increases in
external clinical development costs relating to sotagliflozin
subsequent to Lexicon regaining the rights and responsibilities for
development and commercialization of sotagliflozin pursuant to the
termination of the Sanofi alliance. Full-year R&D expenses for
2019 decreased to $91.9 million from $100.2 million, due to
decreases in professional and consulting fees and lower external
clinical development costs.
Selling, General and Administrative
(SG&A) Expenses: Selling, general and administrative
expenses for the fourth quarter were $14.6 million compared to
$16.6 million for the same period in 2018. Full-year 2019 SG&A
expenses decreased to $56.8 million from $63.8 million, primarily
due to lower marketing expenses and professional and consulting
costs.
Impairment Loss on Intangible
Asset: An impairment loss in 2019 of $28.6 million was
recognized to an indefinite lived intangible asset associated with
Lexicon’s 2010 acquisition of Symphony Icon, due to the decision to
terminate research and development activities related to a program
for irritable bowel syndrome that was among the assets
acquired.
Income Tax Benefit: An income
tax benefit of $6.0 million in 2019 was recognized in connection
with the impairment loss on the indefinite lived intangible asset,
which resulted in a decrease to the deferred tax liability and
created an income tax benefit. During 2018, there was no
income tax benefit.
Net Income (Loss): Net loss for
the fourth quarter was $51.1 million, or $0.48 per share, as
compared to a net loss of $16.8 million, or $0.16 per share, in the
corresponding period in 2018. For the fourth quarter 2019, net loss
included non-cash, stock-based compensation expense of
$3.5 million. For the fourth quarter 2018, net loss included
non-cash, stock-based compensation expense of $2.8 million.
Net income for the full-year 2019 was $130.1 million, or $1.16 per
diluted share, as compared to a net loss of $120.5 million, or
$1.14 per share, in 2018. For the full-year 2019, net income
included non-cash, stock-based compensation expense of
$14.2 million. For the full-year 2018, net loss included
non-cash, stock-based compensation expense of
$11.7 million.
Cash and Investments: As of
December 31, 2019, Lexicon had $271.7 million in cash and
investments, as compared to $160.1 million as of December 31,
2018.
Anticipated Near-Term
Milestones
- H1 2020 – Initiation of a Phase 2 study for LX9211 in diabetic
peripheral neuropathic pain
- H1 2020 – Completion of patient enrollment in the first
efficacy cohort of the Phase 2 study of telotristat ethyl in
biliary tract cancer
- H1 2020 – Topline results from core Phase 3 sotagliflozin
studies in type 2 diabetes
- June 2020 – Presentation of Phase 3 data for sotagliflozin in
type 2 diabetes at the 80th Scientific Sessions of the American
Diabetes Association (ADA)
- September 2020 – Presentation of Phase 3 data for sotagliflozin
in type 2 diabetes at the 56th Annual Meeting of the European
Association for the Study of Diabetes (EASD)
- Q4 2020 – Data from the first efficacy cohort of the Phase 2
study of telotristat ethyl in biliary tract cancer
Conference Call and Webcast
Information
Lexicon management will hold a live conference
call and webcast today at 8:00 am ET / 7:00 am CT to review its
financial and operating results and to provide a general business
update. The dial-in number for the conference call is 888-645-5785
(U.S./Canada) or 970-300-1531 (international). The conference ID
for all callers is 4187725. The live webcast and replay may be
accessed by visiting Lexicon’s website at
www.lexpharma.com/investors. An archived version of the webcast
will be available on the website for 14 days.
About XERMELO (telotristat
ethyl)
Discovered using Lexicon’s unique approach to
gene science, XERMELO (telotristat ethyl) is the first and only
approved oral therapy for carcinoid syndrome diarrhea. XERMELO
targets tryptophan hydroxylase, an enzyme that mediates the excess
serotonin production within metastatic neuroendocrine tumor (mNET)
cells. XERMELO is approved in the United States, the European Union
and certain additional countries for the treatment of carcinoid
syndrome diarrhea in combination with somatostatin analog (SSA)
therapy in adults inadequately controlled by SSA therapy. Carcinoid
syndrome is a rare condition that occurs in patients living with
mNETs and is characterized by frequent and debilitating diarrhea.
XERMELO targets the overproduction of serotonin inside mNET cells,
providing an additional treatment option for patients suffering
from carcinoid syndrome diarrhea.
Lexicon has granted Ipsen an exclusive
royalty-bearing right and license to commercialize XERMELO outside
of the United States and Japan. We are commercializing XERMELO in
the United States and Ipsen is commercializing XERMELO in multiple
countries, including the United Kingdom and Germany.
XERMELO
(telotristat ethyl) Important Safety
Information
- Warnings and Precautions: XERMELO may cause
constipation, which can be serious. Monitor for signs and symptoms
of constipation and/or severe, persistent, or worsening abdominal
pain in patients taking XERMELO. Discontinue XERMELO if severe
constipation or severe, persistent, or worsening abdominal pain
develops.
- Adverse Reactions: The most common adverse
reactions (≥5%) include nausea, headache, increased
gamma-glutamyl-transferase, depression, flatulence, decreased
appetite, peripheral edema, and pyrexia.
- Drug Interactions: If necessary, consider
increasing the dose of concomitant CYP3A4 substrates, as XERMELO
may decrease their systemic exposure. If combination treatment with
XERMELO and short-acting octreotide is needed, administer
short-acting octreotide at least 30 minutes after administering
XERMELO.
For more information about XERMELO, see Full Prescribing
Information at www.xermelo.com.
About Zynquista
(sotagliflozin)
Discovered using Lexicon’s unique approach to
gene science, Zynquista is an oral dual inhibitor of two proteins
responsible for glucose regulation known as sodium-glucose
co-transporter types 1 and 2 (SGLT1 and SGLT2). SGLT1 is
responsible for glucose absorption in the gastrointestinal tract,
and SGLT2 is responsible for glucose reabsorption by the kidney.
Zynquista is approved in the European Union (EU) for use as an
adjunct to insulin therapy to improve blood sugar (glycemic)
control in adults with type 1 diabetes with a body mass index ≥ 27
kg/m2, who could not achieve adequate glycemic control despite
optimal insulin therapy. Outside of such approval, Zynquista is
investigational and has not been approved by any other regulatory
authority for type 1 or type 2 diabetes.
About Lexicon
Pharmaceuticals
Lexicon is a fully integrated biopharmaceutical
company with a mission of pioneering medicines that transform
patients’ lives. Through its Genome5000™ program, Lexicon
scientists studied the role and function of nearly 5,000 genes and
identified more than 100 protein targets with significant
therapeutic potential in a range of diseases. Through the precise
targeting of these proteins, Lexicon is pioneering the discovery
and development of innovative medicines to safely and effectively
treat disease. In addition to its first commercial product,
XERMELO, Lexicon has a pipeline of promising drug candidates in
clinical and preclinical development in diabetes and metabolism,
oncology and neuropathic pain. For additional information, please
visit www.lexpharma.com.
Safe Harbor Statement
This press release contains “forward-looking
statements,” including statements relating to Lexicon’s long-term
outlook on its business, including the clinical development of, the
regulatory filings for, and the potential therapeutic and
commercial potential of XERMELO (telotristat ethyl), Zynquista
(sotagliflozin), and LX9211. In addition, this press release also
contains forward looking statements relating to Lexicon’s growth
and future operating results, discovery, development and
commercialization of products, strategic alliances and intellectual
property, as well as other matters that are not historical facts or
information. All forward-looking statements are based on
management’s current assumptions and expectations and involve
risks, uncertainties and other important factors, specifically
including Lexicon’s ability to meet its capital requirements,
successfully commercialize XERMELO, successfully conduct
preclinical and clinical development and obtain necessary
regulatory approvals of telotristat ethyl, sotagliflozin, LX9211
and its other potential drug candidates on its anticipated
timelines, achieve its operational objectives, obtain patent
protection for its discoveries and establish strategic alliances,
as well as additional factors relating to manufacturing,
intellectual property rights, and the therapeutic or commercial
value of its drug candidates. Any of these risks, uncertainties and
other factors may cause Lexicon’s actual results to be materially
different from any future results expressed or implied by such
forward-looking statements. Information identifying such important
factors is contained under “Risk Factors” in Lexicon’s annual
report on Form 10-K for the year ended December 31, 2018, as filed
with the Securities and Exchange Commission. Lexicon undertakes no
obligation to update or revise any such forward-looking statements,
whether as a result of new information, future events or
otherwise.
Lexicon Pharmaceuticals,
Inc.
Selected Financial Data
Consolidated Statements of Operations Data |
|
Three Months Ended December 31, |
|
Year Ended December 31, |
(In
thousands, except per share data) |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
|
(Unaudited) |
|
|
|
(Unaudited) |
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
Net product revenue |
|
$ |
8,568 |
|
|
$ |
7,521 |
|
|
$ |
32,331 |
|
|
$ |
26,583 |
|
Collaborative agreements |
|
|
22 |
|
|
|
9,479 |
|
|
|
289,231 |
|
|
|
36,271 |
|
Royalties and other revenue |
|
|
137 |
|
|
|
71 |
|
|
|
511 |
|
|
|
355 |
|
Total revenues |
|
|
8,727 |
|
|
|
17,071 |
|
|
|
322,073 |
|
|
|
63,209 |
|
Operating
expenses: |
|
|
|
|
|
|
|
|
Cost of sales (including finite-lived intangible |
|
|
|
|
|
|
|
|
asset amortization) |
|
|
774 |
|
|
|
569 |
|
|
|
3,231 |
|
|
|
2,491 |
|
Research and development, including stock-based compensation |
|
|
|
|
|
|
|
|
of $1,727, $1,488, $7,096 and $6,010, respectively |
|
|
40,606 |
|
|
|
12,307 |
|
|
|
91,924 |
|
|
|
100,243 |
|
Selling, general and administrative, including stock-based
compensation |
|
|
|
|
|
|
|
|
of $1,752, $1,359, $7,122 and $5,686, respectively |
|
|
14,564 |
|
|
|
16,562 |
|
|
|
56,835 |
|
|
|
63,754 |
|
Impairment loss on intangible asset |
|
|
- |
|
|
|
- |
|
|
|
28,638 |
|
|
|
- |
|
Total operating expenses |
|
|
55,944 |
|
|
|
29,438 |
|
|
|
180,628 |
|
|
|
166,488 |
|
Income
(loss) from operations |
|
|
(47,217 |
) |
|
|
(12,367 |
) |
|
|
141,445 |
|
|
|
(103,279 |
) |
Interest
expense |
|
|
(5,191 |
) |
|
|
(5,224 |
) |
|
|
(20,676 |
) |
|
|
(20,777 |
) |
Interest and
other income, net |
|
|
1,270 |
|
|
|
810 |
|
|
|
3,350 |
|
|
|
3,508 |
|
Net income
(loss) before income taxes |
|
|
(51,138 |
) |
|
|
(16,781 |
) |
|
|
124,119 |
|
|
|
(120,548 |
) |
Income tax
benefit |
|
|
- |
|
|
|
- |
|
|
|
6,014 |
|
|
|
- |
|
Net income
(loss) |
|
$ |
(51,138 |
) |
|
$ |
(16,781 |
) |
|
$ |
130,133 |
|
|
$ |
(120,548 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss) per common share, basic |
|
$ |
(0.48 |
) |
|
$ |
(0.16 |
) |
|
$ |
1.23 |
|
|
$ |
(1.14 |
) |
Net income
(loss) per common share, diluted |
|
$ |
(0.48 |
) |
|
$ |
(0.16 |
) |
|
$ |
1.16 |
|
|
$ |
(1.14 |
) |
|
|
|
|
|
|
|
|
|
Shares used
in computing net income (loss) per |
|
|
|
|
|
|
|
|
common share, basic |
|
|
106,272 |
|
|
|
105,920 |
|
|
|
106,218 |
|
|
|
105,830 |
|
Shares used
in computing net income (loss) per |
|
|
|
|
|
|
|
|
common share, diluted |
|
|
106,272 |
|
|
|
105,920 |
|
|
|
116,747 |
|
|
|
105,830 |
|
|
|
|
|
|
|
|
|
|
Consolidated Balance Sheet Data |
|
|
|
|
|
As of December 31, 2019 |
|
As of December 31, 2018 |
(In
thousands) |
|
|
|
|
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
Cash and investments |
|
|
|
|
|
$ |
271,659 |
|
|
$ |
160,052 |
|
Property and equipment, net |
|
|
|
|
|
|
14,047 |
|
|
|
15,865 |
|
Goodwill |
|
|
|
|
|
|
44,543 |
|
|
|
44,543 |
|
Other intangible assets |
|
|
|
|
|
|
19,716 |
|
|
|
50,119 |
|
Total assets |
|
|
|
|
|
|
417,715 |
|
|
|
284,136 |
|
Deferred revenue |
|
|
|
|
|
|
- |
|
|
|
25,990 |
|
Current and long-term debt |
|
|
|
|
|
|
245,183 |
|
|
|
245,002 |
|
Accumulated deficit |
|
|
|
|
|
|
(1,341,444 |
) |
|
|
(1,471,577 |
) |
Total stockholders' equity (deficit) |
|
|
|
|
|
|
117,101 |
|
|
|
(26,405 |
) |
For Investor Inquiries:
Kimberly Lee, D.O.Head of Investor Relations and
Corporate StrategyLexicon Pharmaceuticals(281)
863-3383klee@lexpharma.com
For Media Inquiries:
Chas SchultzExecutive Director, Corporate
Communications and Patient AdvocacyLexicon Pharmaceuticals(281)
863-3421cschultz@lexpharma.com
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