Financial Data and Key Metrics Changes - For Q2 2025, Lexicon Pharmaceuticals reported revenues of $28.9 million, a significant increase from $1.6 million in Q2 2024, primarily driven by $27.5 million in licensing revenue from Novo Nordisk [24] - The net income for Q2 2025 was $3.3 million, or $0.01 per share, compared to a net loss of $53.4 million, or $0.17 per share, in the same period of 2024 [25] - Total operating expenses decreased by $31.9 million quarter over quarter, reflecting the company's strategic repositioning as an R&D-focused entity [27] Business Line Data and Key Metrics Changes - Research and development expenses for Q2 2025 decreased to $15.7 million from $17.6 million in Q2 2024, mainly due to lower external research expenses on the PROGRESS clinical trial [25] - Selling, general, and administrative expenses decreased to $9.4 million in Q2 2025 from $39.2 million in 2024, attributed to reduced marketing efforts for MPEFA [25] Market Data and Key Metrics Changes - The company is actively pursuing regulatory approvals for sotagliflozin in various international markets, including the UAE, Saudi Arabia, Canada, Australia, New Zealand, and several Southeast Asian countries [31] - The ongoing Phase III SONATA study for sotagliflozin is the only registrational trial currently evaluating treatment in both obstructive and non-obstructive hypertrophic cardiomyopathy (HCM) [20] Company Strategy and Development Direction - Lexicon is focused on advancing its innovative portfolio of potential medicines, with a strategic pivot towards R&D that has taken shape in 2025 [6] - The company aims to maximize the potential of its drug candidates through partnerships, particularly with Novo Nordisk for LX9851 and Viatris for sotagliflozin [32] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the progress of their R&D programs and the potential for pilavapitan to become a transformative therapy for patients with neuropathic pain [14] - The company anticipates presenting full progress data for pilavapitan in Q3 2025 and is preparing for an end-of-Phase II meeting [33] Other Important Information - The company ended Q2 2025 with $168 million in cash and short-term investments, down from $238 million at the end of 2024 [26] - Lexicon expects to recognize the remaining $17.5 million of licensing revenue from the Novo agreement in the second half of 2025 [26] Q&A Session Summary Question: Can you walk us through the SOTA CROSS trial and its design? - Management explained that the SOTA CROSS trial is designed to evaluate therapeutic options for non-obstructive HCM, with a crossover design allowing patients to serve as their own control [42] Question: How does the company plan to take advantage of the push for non-opioid pain medications? - Management highlighted their engagement with legislative efforts supporting non-opioid medications and expressed optimism about the potential for pilavapitan in this context [48] Question: What is Novo's plan for the Phase I study in obesity? - Management indicated that Novo is expected to vigorously pursue the Phase I program for LX9851, with a focus on oral and combination therapies [56] Question: How does the recent Vertex announcement impact confidence in the pain market? - Management expressed increased confidence in their own neuropathic pain program, citing successful Phase II results with pilavapitan [72] Question: Will an echo be required for patients if sotagliflozin is approved? - Management stated that while an echo will be part of the study protocol, it may not be a major impediment for patient suitability if approved [78]

Pipeline Progress - Pilavapadin 10 mg consistently delivered clinically meaningful pain reduction in Phase 2 trials[8] - Lexicon plans to present full Phase 2 results for Pilavapadin in September 2025 and partnership discussions are ongoing[5] - IND-enabling studies of LX9851 are on track to be completed in 2025[5] - Accelerated site initiations are underway for the Phase 3 SONATA-HCM study of sotagliflozin in HCM[5] Sotagliflozin in HCM - Approximately 1.1 million people in the U S have either obstructive or non-obstructive HCM[15] - 30% of HCM patients are diagnosed with oHCM and 70% are diagnosed with nHCM[16] - The SONATA-HCM Phase 3 study is evaluating sotagliflozin 400 mg versus placebo in 500 patients with oHCM and nHCM[22] - Enrollment in the SONATA-HCM Phase 3 study is accelerating, with all sites expected to be active by the end of Q3 2025[23] Financial Performance - Lexicon reported $28.9 million in total revenues for Q2 2025, including $1.3 million in net product revenues and $27.5 million in licensing revenue[30] - The $27.5 million in licensing revenue includes an upfront payment for the exclusive licensing agreement of LX9851 with Novo Nordisk[31] - Total operating expenses for 2025 are now expected to be between $105 million and $115 million[33]

[Business and Pipeline Highlights](index=1&type=section&id=Business%20and%20Pipeline%20Highlights) Lexicon Pharmaceuticals reported significant progress across its R&D pipeline in Q2 2025, advancing key programs like pilavapadin, LX9851, and sotagliflozin - The company is executing its strategy as an R&D-focused organization, with **strong progress across all key programs**[3](index=3&type=chunk) [Pilavapadin (LX9211) for Diabetic Peripheral Neuropathic Pain (DPNP)](index=1&type=section&id=Pilavapadin%20(LX9211)%20for%20Diabetic%20Peripheral%20Neuropathic%20Pain%20(DPNP)) Pilavapadin, a potential first-in-class oral, non-opioid drug for DPNP, is in partnership discussions, with additional Phase 2b data expected in September - Partnership discussions for pilavapadin are underway following the completion of the **Phase 2b PROGRESS study**[1](index=1&type=chunk)[5](index=5&type=chunk) - Pilavapadin has the potential to be the **first new oral, non-opioid drug approved for neuropathic pain in over two decades**[5](index=5&type=chunk) [LX9851 for Obesity](index=1&type=section&id=LX9851%20for%20Obesity) Preclinical development of LX9851 for obesity is on track for 2025 completion, with Novo Nordisk's IND submission potentially triggering up to $30 million in milestone payments - IND-enabling studies for LX9851 are on track for **completion in 2025**[1](index=1&type=chunk)[11](index=11&type=chunk) - The licensing agreement with Novo Nordisk includes an **upfront payment of $45 million** (received in April) and potential for up to **$1 billion in total milestones**, plus tiered royalties[11](index=11&type=chunk) - Lexicon is eligible for up to an additional **$30 million in near-term milestone payments** upon planned IND submission and initiation of clinical development by Novo Nordisk[11](index=11&type=chunk) [Sotagliflozin Program](index=2&type=section&id=Sotagliflozin%20Program) The sotagliflozin program is advancing with accelerated enrollment in the SONATA Phase 3 HCM study, Viatris preparing ex-U.S./EU filings, and FDA review for Zynquista® in Type 1 Diabetes - Enrollment in the SONATA Phase 3 study for both obstructive and non-obstructive HCM is accelerating, with **completion targeted for 2026**[1](index=1&type=chunk)[12](index=12&type=chunk) - Licensee Viatris is preparing regulatory filings for sotagliflozin outside the U.S. and EU, which could lead to **royalty payments to Lexicon starting next year**[3](index=3&type=chunk)[12](index=12&type=chunk) - Lexicon is in the end-of-review process with the FDA to evaluate bringing **Zynquista® (sotagliflozin) to market for people with Type 1 Diabetes**[8](index=8&type=chunk) - Sotagliflozin remains commercially available in the U.S. for heart failure under the brand name **INPEFA®**[7](index=7&type=chunk) [Second Quarter 2025 Financial Highlights](index=2&type=section&id=Second%20Quarter%202025%20Financial%20Highlights) Lexicon's Q2 2025 financial performance dramatically improved to a net income of $3.3 million, driven by licensing revenue and significantly reduced operating expenses [Key Financial Results (Q2 2025 vs Q2 2024)](index=2&type=section&id=Key%20Financial%20Results%20(Q2%202025%20vs%20Q2%202024)) Q2 2025 saw total revenues surge to $28.9 million and operating expenses significantly reduced, resulting in a net income of $3.3 million compared to a prior-year loss Key Financial Results Table | Financial Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | **Total Revenues** | $28.9M | $1.6M | +1655% | | R&D Expenses | $15.7M | $17.6M | -10.8% | | SG&A Expenses | $9.4M | $39.2M | -76.0% | | **Net Income (Loss)** | **$3.3M** | **($53.4M)** | **Turned to Profit** | | Net Income (Loss) per Share | $0.01 | ($0.17) | **Turned to Profit** | - The significant increase in revenue was primarily due to **$27.5 million in licensing revenue** from the agreement with Novo Nordisk[10](index=10&type=chunk) - The decrease in SG&A expenses reflects lower costs from the strategic repositioning in late 2024 and significantly reduced marketing for INPEFA in 2025[14](index=14&type=chunk) [Cash Position and Balance Sheet](index=3&type=section&id=Cash%20Position%20and%20Balance%20Sheet) As of June 30, 2025, Lexicon's total cash and investments stood at $168 million, a decrease from $238.0 million at year-end 2024, partly due to severance payments Cash Position and Investments | Balance Sheet Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and investments | $139.0M | $238.0M | | Restricted cash | $29.0M | $0 | | **Total Cash & Investments** | **$168.0M** | **$238.0M** | - The change in cash position includes **$7.5 million in severance payments** related to the strategic repositioning in late 2024[16](index=16&type=chunk) [Detailed Financial Statements](index=5&type=section&id=Detailed%20Financial%20Statements) This section provides a comprehensive breakdown of Lexicon's operating results for Q2 2025 and 2024, alongside consolidated balance sheet data for June 30, 2025, and December 31, 2024 Consolidated Statements of Operations (Three Months Ended) | (In thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Total revenues | $28,866 | $1,647 | | Total operating expenses | $25,130 | $57,001 | | Income (loss) from operations | $3,736 | ($55,354) | | **Net income (loss)** | **$3,252** | **($53,429)** | Consolidated Balance Sheet Data | (In thousands) | As of June 30, 2025 | As of December 31, 2024 | | :--- | :--- | :--- | | Total assets | $225,583 | $298,420 | | Long-term debt, net | $56,107 | $100,298 | | Total stockholders' equity | $129,440 | $145,950 |

Core Insights - Lexicon Pharmaceuticals is making significant progress in its R&D strategy, with ongoing partnership discussions for pilavapadin and IND-enabling studies for LX9851 on track for completion in 2025 [3][4][8] - The company reported a substantial increase in total revenues for Q2 2025, reaching $28.9 million, compared to $1.6 million in Q2 2024, primarily driven by licensing revenue from Novo Nordisk [11][21] - Lexicon's net income for Q2 2025 was $3.3 million, a notable improvement from a net loss of $53.4 million in the same period last year [14][21] Partnership and Product Development - Partnership discussions for pilavapadin are ongoing, with full Phase 2 data expected to be presented at an upcoming medical meeting [3][8] - LX9851, a novel oral candidate for obesity, is in preclinical development, with an exclusive licensing agreement with Novo Nordisk that includes an upfront payment of $45 million and potential milestone payments up to $1 billion [8][11] - The SONATA Phase 3 study for sotagliflozin in hypertrophic cardiomyopathy (HCM) is progressing well, with over 100 sites initiated across 20 countries [3][16] Financial Performance - Total revenues for Q2 2025 were $28.9 million, consisting of $27.5 million in licensing revenue and $1.3 million from INPEFA® sales [11][21] - Research and development expenses decreased to $15.7 million in Q2 2025 from $17.6 million in Q2 2024, reflecting optimized resource allocation [12][21] - Selling, general, and administrative expenses significantly decreased to $9.4 million in Q2 2025 from $39.2 million in Q2 2024 due to strategic repositioning [13][21] Cash Position and Investments - As of June 30, 2025, Lexicon had $139 million in cash and investments, down from $238 million at the end of 2024, primarily due to severance payments related to strategic changes [15][21] - The company also reported $29 million in restricted cash as of the same date [15][21] Pipeline and Future Outlook - Lexicon is focused on advancing its pipeline, with sotagliflozin being commercially available in the U.S. for heart failure as INPEFA® [7][19] - The company is also preparing for regulatory filings for sotagliflozin in various international markets, with submissions already made in the UAE and Saudi Arabia [16][19]

Group 1 - Lexicon Pharmaceuticals has regained compliance with Nasdaq Listing Rule 5550(a)(2) as its common stock has maintained a closing bid price of $1.00 or greater for ten consecutive business days [1] - The update regarding compliance was previously disclosed in the Company's Current Report on Form 8-K filed on July 28, 2025 [1] Group 2 - Lexicon Pharmaceuticals is a biopharmaceutical company focused on pioneering medicines that transform patients' lives [2] - The company utilizes its Genome5000™ program to study nearly 5,000 genes, identifying over 100 protein targets with significant therapeutic potential across various diseases [2] - Lexicon has advanced multiple medicines to market and has a pipeline of promising drug candidates in areas such as heart failure, neuropathic pain, obesity, cardiology, and diabetes [2]

Company Announcement - Lexicon Pharmaceuticals, Inc. will release its second quarter 2025 financial results on August 6, 2025, prior to market open [1] - Management will conduct a conference call and live webcast at 8:30 a.m. ET on the same day to discuss the financial results and provide a business update [1] Conference Call Details - Participants can access the conference call live via webcast on the Company's website [2] - Those wishing to ask questions may register to receive dial-in numbers and a unique pin to join the call [2] - An archived version of the webcast will be available on the Lexicon website [2] Company Overview - Lexicon is a biopharmaceutical company focused on pioneering medicines that transform patients' lives [3] - The Genome5000™ program has enabled Lexicon scientists to study nearly 5,000 genes, identifying over 100 protein targets with significant therapeutic potential [3] - The company has advanced multiple medicines to market and has a pipeline of promising drug candidates in various therapeutic areas including heart failure, neuropathic pain, obesity, cardiology, and diabetes [3]

Core Insights - Lexicon Pharmaceuticals is presenting data on diabetic peripheral neuropathic pain (DPNP) at the 7th Annual Meeting of the American Society of Pain and Neuroscience, highlighting the impact of DPNP on patients despite standard treatments [1][2] - Approximately 9 million patients in the U.S. suffer from DPNP, affecting 30% of type 1 diabetes patients and 50% of type 2 diabetes patients [2] - The study aims to raise awareness among healthcare professionals about the burden of DPNP on patients and encourage discussions about treatment options [3] Product Development - Pilavapadin (LX9211) is an investigational, non-opioid treatment for DPNP, discovered through Lexicon's gene science approach, targeting AAK1 to inhibit pain signaling without affecting opiate pathways [4] - The Phase 2a proof-of-concept RELIEF-DPN-1 study demonstrated that pilavapadin met its primary endpoint by reducing average daily pain scores (ADPS) at week 6 compared to placebo, showing significant benefits in alleviating DPNP symptoms [5] - Pilavapadin has received Fast Track designation from the U.S. FDA for its development in treating DPNP [5] Company Overview - Lexicon Pharmaceuticals focuses on pioneering medicines that transform patients' lives, utilizing its Genome5000™ program to identify therapeutic protein targets across various diseases [6] - The company has a pipeline of drug candidates in clinical and preclinical development for conditions including neuropathic pain, hypertrophic cardiomyopathy, and obesity [6]

Pilavapadin (LX9211) for DPNP - The PROGRESS Phase 2b study identified the 10 mg dose of pilavapadin as the most clinically meaningful for treating Diabetic Peripheral Neuropathic Pain (DPNP) [7] - Post-hoc analysis of the PROGRESS study reaffirmed the 10 mg dose, showing statistically significant results (p = 0.04) when combining the 10 mg and 20/10 mg arms [11] - The 10 mg dose of pilavapadin had a study completion rate of 87.8%, similar to the placebo group's 87.9% [13] - Approximately 60% of U S patients with DPNP have tried multiple treatments, indicating a high unmet need and sizable market opportunity [15] LX9851 for Obesity and Related Metabolic Disorders - LX9851 is a first-in-class, potent, and selective orally bioavailable ACSL5 inhibitor with the potential to address unmet needs in obesity and related cardiometabolic disorders [17] - IND filing for LX9851 is on track for 2025 [20] Sotagliflozin - A Lancet Diabetes & Endocrinology publication highlighted the unique efficacy benefits of sotagliflozin, showing a reduced risk of major adverse cardiovascular events (MACE) with a Hazard Ratio (HR) of 0.77 (95% CI 0 65-0 91), p=0 0020 [23] - The cumulative incidence of total MACE was 10.0 per 100 patients in the sotagliflozin group [23] - Viatris is undertaking ex-US, ex-EU registration and regional development of sotagliflozin [21] Financials - Total revenues for FY 2024 were $31.1 million, compared to $1.2 million in FY 2023 [26] - Lexicon anticipates total operating expenses between $135 million and $145 million for full year 2025 [29]

Pipeline Development - Pilavapadin (LX9211) Phase 2b PROGRESS study identified the 10 mg dose as the most clinically meaningful for DPNP[13], with post-hoc analysis showing statistically significant pain reduction compared to placebo (p = 0.04) in combined 10 mg dosing arms[16] - The PROGRESS study enrolled 496 patients[12], and the 10 mg dose had a completion rate of 87.8%[18], similar to the placebo group's 87.9%[18] - LX9851 IND-enabling studies are underway for obesity and related metabolic disorders[6], showing potential for weight loss maintenance after semaglutide discontinuation in preclinical studies[34] - SONATA-HCM Phase 3 trial is enrolling globally to evaluate sotagliflozin in both obstructive and non-obstructive HCM patients[21, 29] Sotagliflozin & INPEFA - Sotagliflozin has shown a 0.77 hazard ratio (95% CI 0.65-0.91, p=0.0020) for reduced major adverse cardiovascular events (MACE) in patients with T2D, CKD, and high CV risk[23] - Approximately 1.1 million people in the U.S. have HCM[26, 27], presenting a significant market opportunity for sotagliflozin[26] - Viatris is undertaking ex-US, ex-EU registration and regional development of sotagliflozin[21] Market Opportunity & Partnerships - Approximately 9 million U.S. patients have progressive DPNP[20], with 60% experiencing moderate-to-severe pain and low satisfaction with current treatments[20] - Lexicon entered an exclusive licensing agreement with Novo Nordisk for LX9851, receiving $75 million in upfront and near-term milestones, with potential for up to $1 billion in aggregate payments[40] - Lexicon entered an exclusive licensing agreement with Viatris for sotagliflozin outside the U.S. and Europe, receiving $25 million upfront, with potential for almost $200 million in milestone payments[40]

Business Highlights - Lexicon entered an exclusive worldwide licensing agreement with Novo Nordisk for LX9851[5, 21] - Pilavapadin (LX9211) PROGRESS readout identified a de-risked dose of 10mg to move into Phase 3 trials[5] - The company reduced debt and strengthened its financial position[5] - Pilavapadin 10 mg has consistently delivered clinically meaningful pain reduction[7] Market Opportunity - Approximately 9 million people in the U S living with diabetes suffer from DPNP[10] - It is projected that there will be 13 million DPNP patients in the U S by 2035[10] - Approximately 70% of patients with neuropathic pain do not achieve partial pain management[10] - Approximately 11 million people in the U S have either obstructive or non-obstructive HCM[14] Financial Overview - As of March 31, 2025, Lexicon had $1948 million in cash, cash equivalents, and short-term investments[26] - Total debt was $586 million as of March 31, 2025[26] - Total revenues for Q1 2025 were $13 million compared to $11 million in Q1 2024[26] - The company expects total 2025 operating expenses to be between $135 million and $145 million[29]