Lexicon Pharmaceuticals(LXRX) - 2023 Q1 - Earnings Call Transcript

Financial Data and Key Metrics - The company ended Q1 2023 with 105.9 million in cash and investments, providing sufficient resources for commercial preparations and R&D investments [42] - Selling, general, and administrative expenses increased to 19.5 million in Q1 2023, up from $8.5 million in Q1 2022, primarily due to headcount growth and commercial launch preparations for sotagliflozin [43] - Net loss for Q1 2023 was$23.5 million, or $0.16 per share, compared to the same period in 2022 [51] Business Line Data and Key Metrics - Sotagliflozin, a dual SGLT1 and 2 inhibitor for heart failure, is on track for its PDUFA target date of May 27th, with no substantial review issues identified by the FDA [5] - LX9211, an AAK1 inhibitor for neuropathic pain, has shown consistent results across two Phase 2 studies, with FDA feedback expected in Q2 2023 for late-stage development plans [4][49] - The neuropathic pain market is projected to grow by over 13$13.2 billion, presenting a significant opportunity for LX9211 [45] Market Data and Key Metrics - Heart failure is a multi-billion dollar market with substantial growth potential, driven by increasing disease prevalence and new treatment guidelines recommending SGLT inhibitors [12] - The annual cost of heart failure is expected to rise to nearly $70 billion by 2030, with 80$100 million in additional borrowing capacity, including $75 million available upon sotagliflozin approval [73] - Sotagliflozin has demonstrated a 33% reduction in the composite endpoint of cardiovascular death, hospitalization for heart failure, and urgent heart failure visits, with a need to treat only four patients for one year to avoid one event [13] - LX9211 has shown consistent efficacy across two Phase 2 studies, with no drug-related serious adverse events or deaths reported [47][71] Q&A Session Summary Question: What should investors focus on regarding the potential label for sotagliflozin? - The company expects a broad label for sotagliflozin, covering heart failure across all left ventricular ejection fractions, including HFpEF [53][77] Question: What are the key drivers for sales acceleration in 2023 and 2024? - The company will focus on penetrating integrated delivery networks (IDNs) and securing Medicare coverage in 2023, with net sales growth expected in 2024 [79] Question: What is the status of LX9211's development and potential partnerships? - The company is advancing LX9211 into late-stage development for diabetic peripheral neuropathic pain (DPN) and is open to partnerships but will not delay development [62][95] Question: How receptive are payers and hospital systems to sotagliflozin's value proposition? - Receptivity has been very encouraging, with the unique data from the SOLOIST trial resonating well with payers and hospital systems [65][87] Question: Can sotagliflozin be commercially successful with a narrow label? - Management is confident in a broad label scenario but believes sotagliflozin can still differentiate and capture market share even with a narrower label [90][101]