Lexicon Pharmaceuticals, Inc. (Nasdaq: LXRX), today reported
financial results for the three months ended September 30, 2020 and
provided an update of key milestones.
“In the third quarter, we streamlined our
operations to prioritize our focus on our advancement of LX9211, a
promising drug candidate with potential to become a treatment
option for the millions of people living with neuropathic pain.
Most people suffering with neuropathic pain experience only limited
success with available therapies while enduring substantial side
effects,” said Lonnel Coats, Lexicon’s president and chief
executive officer. “We have commenced our first Phase 2 study in
diabetic peripheral neuropathic pain and plan to commence our
second Phase 2 study in post-herpetic neuralgia shortly with
results for both studies expected by the end of next year.”
Third Quarter
Highlights
LX9211
- Commenced patient dosing in
RELIEF-DPN-1, a Phase 2 randomized, placebo-controlled,
multi-center clinical study of LX9211 for the treatment of diabetic
peripheral neuropathic pain. Enrollment is expected to total
approximately 300 patients at 30 U.S. clinical sites.
- Preparing to commence an additional
Phase 2 study of LX9211 in post-herpetic neuralgia later this
year.
Realignment and Debt
Reduction
- Realignment of the business around
LX9211, sotagliflozin and other drug discovery and development
programs.
- Reduced outstanding debt by more
than 90%, including the elimination of its $150 million secured
term loan and $75.8 million principal amount of its 5.25%
Convertible Senior Notes due 2021.
XERMELO® (telotristat
ethyl)
- XERMELO U.S. net sales were $6.5
million in the third quarter of 2020, reflecting sales during the
quarter prior to the completion of the sale of XERMELO and related
assets to TerSera Therapeutics LLC on September 8, 2020.
- Received $160.4 million in cash at
closing of the sale and eligible to receive up to $65 million in
additional milestone payments for the development and
commercialization of XERMELO in patients with biliary tract cancer
and mid-teens royalties on net sales of XERMELO in biliary tract
cancer.
Sotagliflozin
- Announced topline data from four
Phase 3 sotagliflozin studies in type 2 diabetes: SOTA-MONO,
SOTA-SU, SOTA-GLIM and SOTA-INS with all four studies meeting their
primary objectives of lowering A1C in patients with type 2
diabetes.
Upcoming
Milestones
- Q4 2020: Initiation of a Phase 2
study for LX9211 in post-herpetic neuralgia.
- Q4 2020: Presentation of data from
the sotagliflozin SOLOIST and SCORED Phase 3 studies at the
American Heart Association Scientific Sessions 2020.
- Q4 2021: Phase 2 study results in
diabetic peripheral neuropathic pain and in post-herpetic
neuralgia.
Third Quarter
2020 Financial
Highlights
Revenues: Revenues for the
three months ended September 30, 2020 decreased to $6.6 million
from $294.4 million for the corresponding period in 2019. The three
months ended September 30, 2019 included collaborative revenues of
$260.0 million from the termination of the alliance with Sanofi and
recognition of the remaining amount of $23.5 million allocated to
performance obligations from the initial agreement with Sanofi. Net
product revenues for the three months ended September 30, 2020
consisted of $6.5 million from net sales of XERMELO in the U.S.
Cost of Sales: Cost of sales
related to sales of XERMELO for the three months ended September
30, 2020 and 2019 were $0.6 million.
Research and Development
(R&D) Expenses: Research and
development expenses for the three months ended September 30, 2020
increased to $40.1 million from $26.7 million for the corresponding
period in 2019, primarily due to increases in external clinical
development costs related to sotagliflozin subsequent to the
termination of the alliance with Sanofi.
Selling, General and
Administrative (SG&A)
Expenses: Selling, general and administrative
expenses for the three months ended September 30, 2020 decreased to
$12.0 million from $13.9 million for the corresponding period in
2019.
Gain on Sale of XERMELO: A gain
of $132.8 million was recognized for the three months ended
September 30, 2020 from the sale of XERMELO and related assets to
TerSera.
Net
Income: Net income for the three
months ended September 30, 2020 was $82.6 million, or $0.71 per
diluted share, as compared to net income of $226.1 million, or
$1.95 per diluted share, in the corresponding period in 2019. For
the three months ended September 30, 2020 and 2019, net loss
included non-cash, stock-based compensation expense of $1.9 million
and $3.6 million, respectively.
Cash and Investments: As of
September 30, 2020, Lexicon had $111.4 million in cash and
investments, as compared to $271.7 million as of December 31,
2019.
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 7787988. The live webcast and
replay may be accessed by visiting Lexicon’s website at
http://www.lexpharma.com/events. An archived version of the webcast
will be available on the website for 14 days.
About
LX9211
LX9211 is a potent, orally delivered, selective
small molecule inhibitor of AAK1, a target with a pain phenotype
discovered and extensively characterized in an alliance with
Bristol Myers Squibb. Preclinical studies of LX9211 demonstrated
central nervous system penetration and reduction in pain behavior
in models of neuropathic pain without affecting opiate pathways.
Lexicon holds exclusive research, development and commercialization
rights to LX9211 and additional compounds acting through AAK1 under
the alliance.
About
Sotagliflozin
Discovered using Lexicon’s unique approach to
gene science, sotagliflozin 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.
Sotagliflozin 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, but has not yet been commercially
launched.
About Lexicon
Pharmaceuticals
Lexicon is a 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. Lexicon advanced
one of these medicines to market and has a pipeline of promising
drug candidates in discovery and clinical and preclinical
development in diabetes and metabolism, neuropathic pain and other
indications. For additional information, please visit
www.lexpharma.com.
Safe Harbor Statement
This press release contains “forward-looking
statements,” including statements relating to Lexicon’s financial
position, long-term outlook on its business and the clinical
development and therapeutic and commercial potential of its drug
candidates. 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 Lexicon’s ability to meet its
capital requirements, successfully conduct preclinical and clinical
development and obtain necessary regulatory approvals of LX9211,
sotagliflozin 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, 2019, 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 September 30, |
|
Nine Months Ended September 30, |
(In thousands, except per
share data) |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
|
|
(Unaudited) |
|
(Unaudited) |
Revenues: |
|
|
|
|
|
|
|
|
Net product revenue |
|
$ |
6,542 |
|
|
$ |
8,351 |
|
|
$ |
23,404 |
|
|
$ |
23,763 |
|
Collaborative agreements |
|
|
- |
|
|
|
285,910 |
|
|
|
33 |
|
|
|
289,209 |
|
Royalties and other revenue |
|
|
92 |
|
|
|
187 |
|
|
|
359 |
|
|
|
374 |
|
Total revenues |
|
|
6,634 |
|
|
|
294,448 |
|
|
|
23,796 |
|
|
|
313,346 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
Cost of sales (including finite-lived intangible |
|
|
|
|
|
|
|
|
asset amortization) |
|
|
633 |
|
|
|
577 |
|
|
|
1,929 |
|
|
|
2,457 |
|
Research and development, including stock-based |
|
|
|
|
|
|
|
|
compensation of $1,029, $1,698, $5,154 and $5,369,
respectively |
|
|
40,147 |
|
|
|
26,659 |
|
|
|
152,629 |
|
|
|
51,318 |
|
Selling, general and administrative, including stock-based |
|
|
|
|
|
|
|
|
compensation of $875, $1,864, $5,440 and $5,370, respectively |
|
|
11,997 |
|
|
|
13,898 |
|
|
|
40,798 |
|
|
|
42,271 |
|
Impairment loss on buildings |
|
|
- |
|
|
|
- |
|
|
|
1,600 |
|
|
|
- |
|
Impairment loss on intangible asset |
|
|
- |
|
|
|
28,638 |
|
|
|
- |
|
|
|
28,638 |
|
Total operating expenses |
|
|
52,777 |
|
|
|
69,772 |
|
|
|
196,956 |
|
|
|
124,684 |
|
Other operating income: |
|
|
|
|
|
|
|
|
Gain on sale of XERMELO |
|
|
132,818 |
|
|
|
- |
|
|
|
132,818 |
|
|
|
- |
|
Income (loss) from
operations |
|
|
86,675 |
|
|
|
224,676 |
|
|
|
(40,342 |
) |
|
|
188,662 |
|
Loss on debt extinguishments,
net |
|
|
(255 |
) |
|
|
- |
|
|
|
(255 |
) |
|
|
- |
|
Interest expense |
|
|
(4,118 |
) |
|
|
(5,204 |
) |
|
|
(14,374 |
) |
|
|
(15,485 |
) |
Interest and other income,
net |
|
|
301 |
|
|
|
600 |
|
|
|
1,892 |
|
|
|
2,080 |
|
Net income (loss) before
income taxes |
|
|
82,603 |
|
|
|
220,072 |
|
|
|
(53,079 |
) |
|
|
175,257 |
|
Income tax benefit |
|
|
- |
|
|
|
6,014 |
|
|
|
- |
|
|
|
6,014 |
|
Net income (loss) |
|
$ |
82,603 |
|
|
$ |
226,086 |
|
|
$ |
(53,079 |
) |
|
$ |
181,271 |
|
|
|
|
|
|
|
|
|
|
Net income (loss) per common
share, basic |
|
$ |
0.77 |
|
|
$ |
2.13 |
|
|
$ |
(0.50 |
) |
|
$ |
1.71 |
|
Net income (loss) per common
share, diluted |
|
$ |
0.71 |
|
|
$ |
1.95 |
|
|
$ |
(0.50 |
) |
|
$ |
1.59 |
|
|
|
|
|
|
|
|
|
|
Shares used in computing net
income (loss) per common share, basic |
|
|
107,309 |
|
|
|
106,272 |
|
|
|
106,974 |
|
|
|
106,200 |
|
Shares used in computing net
income (loss) per common share, diluted |
|
|
117,552 |
|
|
|
116,640 |
|
|
|
106,974 |
|
|
|
116,742 |
|
|
|
|
|
|
|
|
|
|
|
|
As of |
|
As of |
Consolidated Balance
Sheet Data |
|
Sept. 30, 2020 |
|
Dec. 31, 2019 |
(In thousands) |
|
(Unaudited) |
|
|
Cash and investments |
|
$ |
111,446 |
|
|
$ |
271,659 |
|
Property and equipment,
net |
|
|
11,106 |
|
|
|
14,047 |
|
Goodwill |
|
|
44,543 |
|
|
|
44,543 |
|
Other intangible assets |
|
|
- |
|
|
|
19,716 |
|
Total assets |
|
|
178,928 |
|
|
|
417,715 |
|
Current and long-term
debt |
|
|
20,320 |
|
|
|
245,183 |
|
Accumulated deficit |
|
|
(1,394,523 |
) |
|
|
(1,341,444 |
) |
Total stockholders'
equity |
|
|
87,639 |
|
|
|
117,101 |
|
For Inquiries:
Chas SchultzExecutive Director, Corporate
Communications and Investor RelationsLexicon Pharmaceuticals(281)
863-3421cschultz@lexpharma.com
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