Lexicon Pharmaceuticals(LXRX) - 2025 Q2 - Quarterly Results

Business and Pipeline Highlights 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] Pilavapadin (LX9211) for Diabetic Peripheral Neuropathic Pain (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][5] - Pilavapadin has the potential to be the first new oral, non-opioid drug approved for neuropathic pain in over two decades[5] LX9851 for Obesity 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][11] - 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] - 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] Sotagliflozin Program 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][12] - 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][12] - 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] - Sotagliflozin remains commercially available in the U.S. for heart failure under the brand name INPEFA®[7] Second Quarter 2025 Financial Highlights 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) 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] - 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] Cash Position and Balance Sheet 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] Detailed Financial Statements 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 |