UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________
FORM 8-K
__________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 29, 2015
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)
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:
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o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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o | Soliciting material pursuant to Rule 14a‑12 under the Exchange Act (17 CFR 240.14a‑12) |
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o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d‑2(b)) |
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o | Pre-commencement communications pursuant to Rule 13e‑4(c) under the Exchange Act (17 CFR 240.13e‑4(c)) |
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Item 2.02 | Results of Operations and Financial Condition |
On April 29, 2015, we issued a press release to report our financial results for the quarter ended March 31, 2015. A copy of the press release is attached to this current report on Form 8-K as Exhibit 99.1.
The information in this Form 8-K and the Exhibit attached to this Form 8-K shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such a filing.
On April 29, 2015, we issued a press release announcing that we will effect a reverse stock split at a ratio of one share of newly issued common stock for each seven shares of issued and outstanding common stock. A copy of the press release is attached to this current report on Form 8-K as Exhibit 99.2.
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Item 9.01 | Financial Statements and Exhibits |
(d) Exhibits
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Exhibit No. | Description |
99.1 | — | Press Release of Lexicon Pharmaceuticals, Inc. dated April 29, 2015 |
99.2 | — | Press Release of Lexicon Pharmaceuticals, Inc. dated April 29, 2015 |
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: April 29, 2015 | By: | /s/ Brian T. Crum |
| | Brian T. Crum |
| | Vice President and General Counsel |
Index to Exhibits
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| | |
Exhibit No. | Description |
99.1 | — | Press Release of Lexicon Pharmaceuticals, Inc. dated April 29, 2015 |
99.2 | — | Press Release of Lexicon Pharmaceuticals, Inc. dated April 29, 2015 |
Exhibit 99.1
LEXICON PHARMACEUTICALS PROVIDES CLINICAL PIPELINE UPDATE
AND REPORTS 2015 FIRST QUARTER FINANCIAL RESULTS
Conference Call and Webcast at 5:00 p.m. Eastern Time
The Woodlands, Texas, April 29, 2015 - Lexicon Pharmaceuticals, Inc. (Nasdaq: LXRX), a biopharmaceutical company focused on developing breakthrough treatments for human disease, today updated its drug development progress and reported financial results for the three months ended March 31, 2015.
“We anticipate 2015 being a pivotal year for Lexicon and our two lead drug candidates, telotristat etiprate and sotagliflozin,” said Lonnel Coats, Lexicon’s president and chief executive officer. “During this quarter, we made significant progress in the development of both programs by completing enrollment in our pivotal Phase 3 trial of telotristat etiprate and initiating screening in our first pivotal Phase 3 trial of sotagliflozin.”
Progress in Clinical Pipeline
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• | Telotristat etiprate (LX1032): Lexicon completed enrollment in TELESTAR, its pivotal Phase 3 clinical trial of telotristat etiprate for patients with carcinoid syndrome. The company expects to announce top-line data from the TELESTAR trial in the third quarter of 2015. Telotristat etiprate is an inhibitor of tryptophan hydroxylase (TPH) that reduces peripheral serotonin production without affecting brain serotonin levels. The company will complete enrollment on April 30, 2015 in TELECAST, its companion study which is being conducted in order to obtain additional safety data. |
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• | Sotagliflozin (LX4211): Lexicon has commenced enrollment of patients in the first of its two pivotal Phase 3 clinical trials of sotagliflozin for type 1 diabetes and is preparing to initiate screening in the second pivotal Phase 3 study. Sotagliflozin is a dual inhibitor of sodium-glucose transporters 1 and 2 (SGLT1 and SGLT2). In parallel with Phase 3 development, Lexicon is conducting a Phase 2 clinical trial of sotagliflozin in collaboration with JDRF focused on young adults with type 1 diabetes and high A1C, representative of a population of particularly high unmet need. |
Expansion of Commercialization Collaboration
In March 2015, Lexicon expanded its October 2014 collaboration agreement with Ipsen Pharma SAS to include rights for Ipsen to commercialize telotristat etiprate in Canada. Under the expanded alliance, Lexicon retains sole rights to commercialize telotristat etiprate in the United States and Japan. Lexicon is eligible to receive up to $5 million in upfront and pre-commercialization milestones. Net sales in Canada will be aggregated with those in Europe and other territories licensed to Ipsen for purposes of the royalties and sales milestones to be paid to Lexicon under the agreement.
Financial Results
Revenues: Lexicon’s revenues for the three months ended March 31, 2015 increased to $1.8 million from $0.3 million for the corresponding period in 2014, primarily due to revenues recognized from the license and collaboration agreement with Ipsen.
Research and Development Expenses: Research and development expenses for the three months ended March 31, 2015 decreased 13 percent to $20.9 million from $24.0 million for the corresponding period in 2014, primarily due to reductions in personnel costs as a result of the restructuring in 2014, partially offset by increases in external clinical research and development costs.
Change in Fair Value of Symphony Icon Purchase Liability: In connection with the acquisition of Symphony Icon, Lexicon made an initial estimate of the fair value of the liability for the associated base and contingent payments. Changes in this liability, based on the development of the programs and the time until such payments are expected to
be made, are recorded in Lexicon’s consolidated statements of operations. For the three months ended March 31, 2015, the fair value of the Symphony Icon purchase liability increased by $1.8 million as compared to an increase of $1.1 million in the corresponding period in 2014.
General and Administrative Expenses: General and administrative expenses for the three months ended March 31, 2015 was $5.7 million, consistent with the corresponding period in 2014.
Consolidated Net Loss: Net loss for the three months ended March 31, 2015 was $28.1 million, or $0.04 per share, compared to a net loss of $30.8 million, or $0.06 per share, in the corresponding period in 2014. For the three months ended March 31, 2015 and 2014, net loss included non-cash, stock-based compensation expense of $2.0 million and $2.3 million, respectively.
Cash and Investments: As of March 31, 2015, Lexicon had $315.1 million in cash and investments, as compared to $339.3 million as of December 31, 2014.
Lexicon Conference Call
Lexicon management will hold a conference call to discuss its clinical development progress and financial results at 5:00 p.m. Eastern Time on April 29, 2015. The dial-in number for the conference call is 888-645-5785 (within the US/Canada) or 970-300-1531 (international). The conference ID for all callers is 37172080. Investors can access a live webcast of the call at www.lexpharma.com. An archived version of the webcast will be available on the website through May 29, 2015.
About Lexicon
Lexicon is a biopharmaceutical company focused on developing breakthrough treatments for human disease. Lexicon has clinical-stage drug programs for diabetes, carcinoid syndrome, and other indications, all of which were discovered by Lexicon’s research team. Lexicon has used its proprietary gene knockout technology to identify more than 100 promising drug targets. For additional information about Lexicon and its programs, please visit www.lexpharma.com.
Safe Harbor Statement
This press release contains “forward-looking statements,” including statements relating to Lexicon’s clinical development of sotagliflozin (LX4211) and telotristat etiprate (LX1032), including characterizations of the results of and projected timing of clinical trials and the potential therapeutic and commercial potential of sotagliflozin and telotristat etiprate. In addition, this press release also contains forward-looking statements relating to Lexicon’s growth and future operating results, discovery and development 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 those relating to Lexicon’s ability to meet its capital requirements, successfully conduct clinical development of sotagliflozin and telotristat etiprate and preclinical and clinical development of its other potential drug candidates, obtain necessary regulatory approvals, 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, that 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, 2014, 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
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| | | | | | | | |
Consolidated Statements of Operations Data | | Three Months Ended March 31, |
(In thousands, except per share data) | | 2015 | | 2014 |
| | (unaudited) |
Revenues: | | | | |
Collaborative agreements | | $ | 1,792 |
| | $ | 172 |
|
Subscription and license fees | | — |
| | 105 |
|
Total revenues | | 1,792 |
| | 277 |
|
Operating expenses: | | | | |
Research and development, including stock-based compensation of $1,104 and $1,458, respectively | | 20,865 |
| | 23,953 |
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Increase in fair value of Symphony Icon, Inc. purchase liability | | 1,753 |
| | 1,142 |
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General and administrative, including stock-based compensation of $849 and $792, respectively | | 5,701 |
| | 5,654 |
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Total operating expenses | | 28,319 |
| | 30,749 |
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Loss from operations | | (26,527) |
| | (30,472) |
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Interest expense | | (1,702) |
| | (457) |
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Interest and other income, net | | 153 |
| | 94 |
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Consolidated net loss | | $ | (28,076 | ) | | $ | (30,835 | ) |
| | | | |
Consolidated net loss per common share, basic and diluted | | $ | (0.04 | ) | | $ | (0.06 | ) |
| | | | |
Shares used in computing consolidated net loss per common share, basic and diluted | | 724,613 |
| | 513,955 |
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| | | | | | | |
Consolidated Balance Sheet Data | As of March 31, | | As of December 31, |
(In thousands) | 2015 | | 2014 |
| (unaudited) | | |
Cash and investments | $ | 315,097 |
| | $ | 339,339 |
|
Assets held for sale | 23,849 |
| | 23,849 |
|
Property and equipment, net | 732 |
| | 1,080 |
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Goodwill | 44,543 |
| | 44,543 |
|
Other intangible assets | 53,357 |
| | 53,557 |
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Total assets | 444,682 |
| | 471,376 |
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Deferred revenue | 14,019 |
| | 14,297 |
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Current and long-term debt | 107,211 |
| | 107,667 |
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Other long-term liabilities | 23,259 |
| | 23,535 |
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Accumulated deficit | (1,132,328 | ) | | (1,104,252 | ) |
Total stockholders’ equity | 257,607 |
| | 284,018 |
|
# # #
Contact for Lexicon:
Chas Schultz
Senior Director, Finance and Communications
281/863-3421
cschultz@lexpharma.com
Exhibit 99.2
LEXICON ANNOUNCES ONE FOR SEVEN REVERSE STOCK SPLIT
EFFECTIVE MAY 20, 2015
Stockholders Overwhelmingly Approved Authorization for Reverse Stock Split
The Woodlands, Texas, April 29, 2015 - Lexicon Pharmaceuticals, Inc. (Nasdaq: LXRX) announced today that it will effect a reverse stock split at a ratio of one share of newly issued common stock for each seven shares of issued and outstanding common stock. Lexicon anticipates that the reverse stock split will be effective at 5:00 p.m. Eastern Time on May 20, 2015, and that its common stock will commence trading on a split-adjusted basis as of the opening of trading on May 21, 2015.
Lexicon stockholders previously approved an amendment to Lexicon’s certificate of incorporation to effect the reverse stock split at the discretion of Lexicon’s board of directors. The amendment was approved by 98.6% of the shares which voted on the proposal, with 94.8% of the total shares outstanding on the record date voting.
Upon effectiveness of the reverse stock split, each seven shares of issued and outstanding common stock will be automatically converted into one newly issued and outstanding share of common stock. This will proportionally reduce the total number of shares outstanding from approximately 725.1 million to approximately 103.6 million. Proportional adjustments will also be made to all shares of common stock issuable under Lexicon’s equity incentive plans and upon conversion of Lexicon’s 5.25% Convertible Senior Notes due 2021. Concurrent with the reverse stock split, the authorized shares of common stock will be reduced from 900 million to 225 million.
No fractional shares will be issued in connection with the reverse stock split. Any fractional share of common stock that would otherwise have resulted from the reverse stock split will be converted into cash payments equal to such fraction multiplied by the closing sales price of the common stock as reported on the Nasdaq Global Select Market on the last trading day immediately preceding the effective date of the reverse stock split.
Lexicon has chosen its transfer agent, Computershare Inc., to act as exchange agent for the reverse stock split. Stockholders holding their shares in book-entry form or through a bank, broker or other nominee do not need to take any action in connection with the reverse stock split, and will see the impact of the reverse stock split automatically reflected in their accounts following the effective date. For those stockholders holding physical stock certificates, Computershare will send instructions for exchanging those certificates for shares held in book-entry form or for new certificates, in either case representing the post-split number of shares. Computershare can be reached at (877) 854-4583.
Lexicon’s trading symbol of “LXRX” will not change as a result of the reverse stock split, although it is expected that Nasdaq will append a “D” to Lexicon’s ticker symbol for approximately 20 trading days following the effective date to indicate the completion of the reverse stock split.
About Lexicon
Lexicon is a biopharmaceutical company focused on developing breakthrough treatments for human disease. Lexicon has clinical-stage drug programs for diabetes, carcinoid syndrome, and other indications, all of which were discovered by Lexicon’s research team. Lexicon has used its proprietary gene knockout technology to identify more than 100 promising drug targets. For additional information about Lexicon and its programs, please visit www.lexpharma.com.
Safe Harbor Statement
This press release contains “forward-looking statements,” including statements relating to Lexicon’s growth and future operating results, discovery and development 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 those relating to Lexicon’s ability to meet its capital requirements, successfully conduct preclinical and clinical development of its drug candidates, obtain necessary regulatory approvals, 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, that 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, 2014, 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.
# # #
Contact for Lexicon:
Chas Schultz
Senior Director, Finance and Communications
281/863-3421
cschultz@lexpharma.com
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