0001062822FALSE00010628222020-07-292020-07-29
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
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CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
Date of Report (Date of earliest event reported): July 29,
2020
Lexicon Pharmaceuticals, Inc.
(Exact name of registrant as specified in its charter)
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Delaware |
000-30111 |
76-0474169 |
(State or other jurisdiction of
incorporation or organization) |
(Commission File Number) |
(I.R.S. Employer
Identification Number) |
8800 Technology Forest Place
The Woodlands, Texas 77381
(Address of principal executive offices and Zip Code)
(281) 863-3000
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the
Act:
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Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered |
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Common Stock, par value $0.001 |
LXRX |
The Nasdaq Global Select Market |
Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligations of the registrant
under any of the following provisions:
☐ Written
communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
☐ Soliciting
material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
☐ Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act
(17 CFR 240.14d-2(b))
☐ Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act
(17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth
company as defined in Rule 405 of the Securities Act of 1933 (§
230.405 of this chapter) or Rule 12b-2 of the Securities Exchange
Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company
☐
If an emerging growth company, indicate by check mark if the
registrant has elected not to use the extended transition period
for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange
Act.
☐
Item 1.01 Entry into a Material Definitive
Agreement
On July 29, 2020, Lexicon Pharmaceuticals, Inc. (the “Company”) and
TerSera Therapeutics LLC (“TerSera”) entered into an Asset Purchase
and Sale Agreement (the “Purchase and Sale Agreement”) pursuant to
which the Company agreed to sell to TerSera the Company’s XERMELO®
(telotristat ethyl) product and related assets.
The consideration to be paid by TerSera pursuant to the Purchase
and Sale Agreement will consist of: (a) an upfront cash payment
payable at the closing of the transaction expected to be equal to
approximately $159,000,000, including the book value of inventory,
subject to working capital and other adjustments set forth in the
Purchase and Sale Agreement, and (b) the following potential future
contingent payments: (i) development, regulatory and sales
milestone payments of up to an aggregate of $65 million for the
development and commercialization of XERMELO in patients with
biliary tract cancer and (ii) mid-teens percentage royalty payments
on net sales of XERMELO in biliary tract cancer.
In connection with the closing of the transaction, the Company
expects to repay (or cause to be repaid) in full the Company’s
borrowings under its Loan Agreement, dated December 4, 2017, with
BioPharma Credit PLC, as collateral agent and a lender, and
BioPharma Credit Investments IV Sub LP, as a lender.
The transaction is expected to close in the third quarter of 2020,
subject to the satisfaction or waiver of customary conditions,
including the expiration or termination of the waiting period under
the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended.
The Purchase and Sale Agreement contains representations,
warranties and covenants as to the parties’ business, financial and
legal obligations and provides for indemnification by each of the
parties in certain circumstances.
The Purchase and Sale Agreement and this summary are not intended
to modify or supplement any factual disclosures about the Company
or TerSera. The foregoing descriptions of the transaction and the
Purchase and Sale Agreement do not purport to be complete and are
qualified in their entirety by reference to the complete text of
the Purchase and Sale Agreement, which the Company intends to file
with a future filing with the Securities and Exchange
Commission.
The representations, warranties and covenants contained in the
Purchase and Sale Agreement were made only for the purposes of the
Purchase and Sale Agreement, were made as of specific dates, were
made solely for the benefit of the parties to the Purchase and Sale
Agreement and may not have been intended to be statements of fact
but, rather, as a method of allocating risk and governing the
contractual rights and relationships between the parties to the
Purchase and Sale Agreement. The assertions embodied in those
representations and warranties may be subject to important
qualifications and limitations agreed to by the Company and TerSera
in connection with negotiating their respective terms. Moreover,
the representations and warranties may be subject to a contractual
standard of materiality that may be different from what may be
viewed as material to stockholders. For the foregoing reasons, none
of the Company’s stockholders or any other person should rely on
such representations and warranties, or any characterizations
thereof, as statements of factual information at the time they were
made or otherwise.
Item 8 .01 Other Events
On July 30, 2020, the Company issued a press release announcing the
execution of the Purchase and Sale Agreement with TerSera. The full
text of the press release issued in connection with the
announcement is attached hereto as Exhibit 99.1 and incorporated
herein by this reference.
Safe Harbor
Statements contained in this Current Report on Form 8-K about the
Company, the Purchase and Sale Agreement and the transaction that
are not purely historical, and all other statements that are not
purely historical, may be deemed to be forward-looking statements
for purposes of the safe harbor provisions under The Private
Securities Litigation Reform Act of 1995. Without limiting the
foregoing, the words “believes,” “anticipates” and “expects” and
similar expressions are intended to identify forward-looking
statements. These forward-looking statements involve known and
unknown risks and uncertainties that may cause the Company’s actual
results, levels of activity, performance or achievements to be
materially different from those expressed or implied by these
forward-looking statements. Important factors that may cause or
contribute to such differences include the parties’ ability to
consummate the transaction; the conditions to the completion of the
transaction, including without limitation the expiration or
termination of the waiting period under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended, applicable to the
transaction; the parties’ ability to meet expectations regarding
the timing, completion and accounting and tax treatments of the
transaction; the anticipated cash and non-cash charges associated
with the transaction; the ability of the Company to successfully
separate the XERMELO® business from the Company’s other businesses;
the commercial success of telotristat ethyl for the treatment of
BTC and the risk that future milestone and royalty payments may not
be received by the Company on the terms negotiated with TerSera or
at all; and such other factors as are set forth in the risk factors
detailed from time to time in the Company’s filings with the
Securities and Exchange Commission, including, without limitation,
the risk factors detailed in the Company’s Annual Report on Form
10-K for the year ended December 31, 2019 and the Company’s
Quarterly Report on Form 10-Q for the quarter ended June 30, 2020,
which are incorporated herein by reference. The Company
specifically disclaims any obligation to update these
forward-looking statements, unless required by law.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
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Exhibit No. |
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Description |
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99.1 |
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Signatures
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly
authorized.
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Lexicon Pharmaceuticals, Inc. |
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Date: July 30, 2020 |
By: |
/s/ Brian T. Crum |
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Brian T. Crum |
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Vice
President and General Counsel
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Index to Exhibits
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Exhibit No. |
Description |
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99.1 |
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Lexicon Pharmaceuticals (NASDAQ:LXRX)
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Lexicon Pharmaceuticals (NASDAQ:LXRX)
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