Lexicon Pharmaceuticals Q3 2025 Earnings Call - Advancing Pipeline with Pilobafidin Phase 3 Readiness and Accelerated HCM Trial Enrollment

Conference Operator: Welcome to the Lexicon Pharmaceuticals Third Quarter 2025 Financial Results Conference Call. At this time, all participants are in listen-in mode. Following the management’s prepared remarks, we will hold a brief question-and-answer session. As a reminder, this call is being recorded today, November 6, 2025. I will now turn the call over to Lisa DeFrancesco, Senior Vice President for Investor Relations and Corporate Communications for Lexicon. Please go ahead, Lisa.

Lisa DeFrancesco, Senior Vice President for Investor Relations and Corporate Communications, Lexicon Pharmaceuticals: Thank you, Mila. Good morning and welcome to our Third Quarter 2025 Conference Call. Joining me today are Dr. Mike Exton, Lexicon’s Chief Executive Officer and Director, Dr. Craig Granowitz, Senior Vice President and Chief Medical Officer, and Scott Cianti, Senior Vice President and Chief Financial Officer. This morning, Lexicon issued a press release announcing our financial results for the third quarter of 2025, which is available on our website at www.lexpharma.com and through our SEC filing. A webcast of this call, along with a slide presentation, is also available on our website. During the call, we will also review the information provided in the press release, provide a corporate update, and then use the remainder of our time to answer your questions.

Before we begin, let me remind you that we will be making forward-looking statements, including statements related to the safety, efficacy, clinical development, regulatory status, and therapeutic and commercial potential of pilobafidin, LX9851, sotagliflozin, and our other drug programs, as well as our business generally. These statements may include characterizations and projections relating to the clinical development, regulatory status, and market opportunity for our drug programs and the commercial performance of Empefa for heart failure. This call may also contain forward-looking statements relating to our growth and future operating results, discovery and development of our drug candidates, strategic alliances, and intellectual property, as well as other matters that are not historical facts or information.

Various risks may cause our actual results to differ materially from those expressed or implied in such forward-looking statements, and we refer you to our most recent annual report on Form 10-K and our other SEC filings for detailed information describing such risks. I would now like to turn the call over to Mike Exton. Mike.

Mike Exton, Chief Executive Officer and Director, Lexicon Pharmaceuticals: Okay. Great. Thank you, Lisa, and good day, everyone. Great to have you all with us this morning. We’re really excited to give you updates on this quarter and all the great work that’s going on here at Lexicon. Now, as we approach the final weeks of the year, I wanted to really begin by re-grounding you on the ambitious set of strategic imperatives that we set out at the start of this year, which were designed to drive long-term value for the company. Now, these goals were, firstly, to progress pilobafidin to be ready for phase 3 registrational trials. Secondly, submit an IND for LX9851, our novel non-incretin candidate in obesity. Thirdly, to recruit patients and accelerate recruitment into our ongoing phase 3 clinical trial in hypertrophic cardiomyopathy, or HCM, named Sonata. Continue the ongoing discussions with FDA on Zingquista and establish a path forward in type 1 diabetes.

Finally, to add targeted partnerships to maximize the value of our R&D programs. Now, throughout the past three quarters, we’ve made really excellent progress, not only against these goals but within our pipeline and across our organization. In addition, we’ve continued to make strategic decisions to further advance our position across cardiometabolic disease with high unmet need. In so doing, we’ve successfully repositioned the company to really focus on R&D. We’ve achieved this focus by developing our innovative pipeline, maximizing operational efficiency, and elevating the focus on targeted partnering. Allow me to outline the substantial progress in R&D. For pilobafidin, we recently presented a post-hoc analysis of the aggregated results of our phase 2 program in diabetic peripheral neuropathic pain, or DPNP. All of our findings to date reinforce the broad clinical potential for this novel molecule, as well as its phase 3 readiness.

We are working with the FDA on next steps, as well as engaging with potential partners. For LX9851, I’m really pleased to say that we’ve completed our IND enabling studies. As you know, earlier this year, we entered into an exclusive agreement with a strong partner who had the capabilities to develop this asset as quickly and as broadly as possible. Finally, for sotagliflozin, all 130-plus sites are now active in our phase 3 Sonata study in HCM, which is the only phase 3 HCM program enrolling both obstructive and non-obstructive subtypes. Operationally, we are very mindful of resource utilization here at Lexicon across all parts of the business. This has enabled us to significantly reduce our operating expenses while preserving investment in areas where we believe we have the highest probability of value creation.

Embedding an efficiency mindset has also resulted in us implementing innovative ways to drive our business forward. For example, as many of you are aware, a substantial proportion of the current evidence generation for sotagliflozin is conducted and funded by third parties. On the commercial side of our business, we’ve recently introduced an innovative virtual sales support system for Empefa here in the U.S., as we look to move Empefa from a stable break-even business to a growing profitable revenue stream for Lexicon in 2026 and beyond. Now, before Craig takes us through specific updates on the pipeline, I’d like to take a few moments to talk about some other internal and external pillars that we believe will continue to positively shape our business moving forward.

First of all, as we continue to advance the science and explore the clinical potential of our assets, strategic and thoughtful partnering is vital to increasing the likelihood of our potential products reaching patients. Now, we’ve demonstrated our ability to partner with strong organizations, and I’m really impressed, not only by the capability and drive our partners are demonstrating, but how seamlessly and effectively our teams are really working together. We can already see our strategy in action. Firstly, we’re working closely with Viatris on expanding the reach of sotagliflozin for heart failure in major markets and territories outside of the U.S. and Europe, and they’re making really excellent progress. Really, really happy with that partnership with Viatris. Secondly, we aim to maximize the potential of LX9851 with our licensee Novo Nordisk, who, as you know, are a global expert in obesity and related conditions.

Our recent completion of IND enabling studies of LX9851 in obesity means that we may earn up to $30 million in near-term milestone payments as 9851 enters future phases of development. Lastly, partnership discussions are ongoing with pilobafidin, where we aim to collaborate with a high-quality partner to unlock the pipeline and appeal potential of this asset globally and across multiple indications. Our approach to partnership remains flexible, as we aim to stay focused internally on our core cardiometabolic expertise. Second, I’d like to turn your attention to Zingquista, as our engagement with the FDA has progressed significantly. In September, we shared that we’ve submitted additional data to the FDA supporting the benefit-risk profile of Zingquista as an adjunct to insulin for glycemic control in adults with type 1 diabetes.

These data were from ongoing third-party-funded investigator-sponsored trials of Zingquista and were submitted as part of a type D process to address the concerns the FDA had raised in its December 2024 complete response letter. We feel that these data support a positive benefit-risk of Zingquista and address the concerns raised. We are committed to working with the FDA on a path forward. In fact, the agency confirmed that they expect to provide written feedback by the end of this year. Following alignment with the FDA, Lexicon would target a resubmission as early as possible in 2026. Finally, with healthcare on the political agenda in DC and beyond, we see positive shifts and opportunities in this environment for our portfolio. One area where this is particularly apparent is neuropathic pain management.

Neuropathic pain is a type of chronic pain in which there’s been little advancement in treatments for over two decades, despite its significant impact on patients’ quality of life. For those with chronic pain, many are prescribed oral opioids despite the known serious risks of misuse. Better, safer options are not only needed, but in fact being demanded. There have been three major developments this quarter that I want to update you on. Firstly, as a part of our advocacy efforts this year, Lexicon Pharmaceuticals convened the first-ever chronic pain roundtable in Washington DC with representatives across clinical, patient, and payer communities. We’re really inspired by this discussion with all of these experts, all of whom are actively advocating for recognition of chronic pain in legislation and the need for new innovation and access to non-opioid treatment options.

Second, and most recently, just a few days ago, a new bill, the Relief of Chronic Pain Act, was introduced into the U.S. Senate to increase access to non-opioid therapies for Medicare patients with chronic pain. Finally, the FDA recently issued new draft guidance to expand non-opioid options for chronic pain management. These three factors, together with additional legislative efforts that are currently making their way through Congress, really underscore the critical bipartisan demand for opioid alternatives in pain management. Overall, we’re encouraged to see that not only these signals from the broader legislative environment, but also other important catalysts for change. From regulatory openness, evolving access dynamics, AI exploration, and overall changes in clinical care, all of these changes are huge opportunities for our company. With that, I’ll turn it over to Craig to further update you on our assets under development.

Over to you, Craig.

Craig Granowitz, Senior Vice President and Chief Medical Officer, Lexicon Pharmaceuticals: Thank you, Mike. As Mike mentioned, we have made significant progress across our pipeline this year. It has been a busy and productive three quarters. I’d like to begin with pilobafidin, our novel non-opioid AAK1 inhibitor. Data and analyses from three separate phase 2 trials in neuropathic pain provide evidence of consistent and clinically meaningful pain reduction and validate the response and tolerability profiles of pilobafidin. While our lead indication in DPNP represents a mature clinical program, several secondary indications are also phase 2 ready, providing significant expansion opportunities. In addition, the AAK pathway is central to a number of cellular processes, such as synaptic signaling between neurons. With this in mind, we’ve also conducted IND enabling work in multiple neuroscience indications, underscoring pilobafidin as a potential pipeline in a pill.

We’ve accumulated data from more than 600 patients treated with pilobafidin and have demonstrated a well-understood and acceptable safety and tolerability profile. Finally, patent protection on the pilobafidin molecule extends through 2040 when including an anticipated five-year extension. This provides a long period of exclusivity to maximize the value of any investment related to this asset. For the past several weeks, we have presented data on pilobafidin and DPNP at a number of important medical meetings. For context, earlier this year, we shared top-line data from PROGRESS, our phase 2b study of pilobafidin in patients with DPNP. The study met its objective of identifying 10 milligrams as the appropriate dose to advance into phase 3 development. Since that time, we have completed additional post-hoc analyses and an additional renal impairment study to further clarify the product profile. We set out to achieve a few objectives with these analyses.

One, to investigate an exposure-response relationship. Second, to evaluate adherence across treatment arms. Third, to validate the robustness of the 10 milligram dose. Finally, to confirm the safety and tolerability profile by evaluating pilobafidin’s pharmacokinetic profile in a broader patient population. The post-hoc PROGRESS and RELIEF analyses that we presented in September and October successfully addressed these key objectives, leading us to a few important conclusions. There is a linear relationship between increased plasma levels of pilobafidin and reduction in pain score. The post-hoc analysis confirmed the biological activity of this drug. Second, pilobafidin’s effects on pain are clinically meaningful. Notably, the 10 milligram dose achieved a two-point drop in ADPS from baseline by week 12. Third, the 10 milligram dose demonstrates an acceptable tolerability profile with nearly the same percentage of patients completing the study on treatment arm as the placebo arms.

Lastly, we conducted additional human studies that have concluded there are no cardiac signals such as QTc prolongation. In patients with mild to moderate renal impairment, no pilobafidin dose adjustments will be required. These are important findings that support a broader potential patient population to be included in the phase 3 studies. What’s next for pilobafidin? With the results from our phase 2 program, our request for an end-of-phase 2 meeting with the FDA has been granted. We are scheduled to meet with the agency by the end of this year and receive written feedback from the agency by early next year. In parallel, we are progressing our planning for a phase 3 program in DPNP.

We have incorporated the input from our scientific advisory board, who were supportive of our phase 3 development approach, as well as elements from the recent guidance from the FDA on non-opioid clinical development. In conjunction with this activity, we continue to have ongoing engagement with potential partners. Now, to shift our attention to sotagliflozin, where we believe our opportunity continues to strengthen with time. Empefa has remained on the market in the US, and we see steady sales from our base of loyal prescribers. We also continue to build distinguishing evidence from investigator-initiated studies supporting sotagliflozin’s mechanism in hypertrophic cardiomyopathy, heart failure, and in major adverse cardiac events, or MACE. Beyond heart failure, where sotagliflozin has been approved in the US based on clinical data from two large outcome studies, enrollment in our phase 3 program of sotagliflozin and HCM continues to accelerate.

Lastly, as Mike outlined earlier, we are maintaining close communication with the FDA about the potential resubmission of Zingquista in type 1 diabetes. We strongly believe these three factors are integral in establishing sotagliflozin’s potential as a new class of therapy. We have three upcoming data presentations this week at the AHA scientific sessions and the HCM Society meetings, which will highlight sotagliflozin’s unique potential across diverse patient populations. As you may know, cardiac care is complex, involving multimodal treatment in an effort to improve overall patient outcomes. Of particular importance for us, many patients who have hypertrophic cardiomyopathy go on to experience major adverse cardiac events such as myocardial infarction, stroke, or heart failure. At this weekend’s meetings, Dr. Quinn from Boston University Medical Center, Dr. Bottomon from Mount Sinai in New York City, and Dr.

McGuire from the University of Texas will highlight respectively sotagliflozin’s impact on cardiac remodeling in HCM. An AHA late breaker on the benefits of sotagliflozin in HFpEF, and a presentation on the effects of MACE events in patients with type 2 diabetes. Sonata HCM is a large global registration trial with a KCCQ endpoint designed to support a regulatory filing and broad label in HCM. Sonata HCM is the only ongoing registrational trial currently evaluating a treatment in both obstructive and non-obstructive HCM. We recently completed the target 130-plus site initiations in 20 countries across the United States, Europe, Israel, and Latin America. This is an important milestone for the program, and I couldn’t be more proud of the team’s significant efforts in achieving this goal. With these site initiations complete, there has been a significant acceleration in study enrollment.

I’ll now turn it over to Scott to provide an update on the company’s financials.

Scott Cianti, Senior Vice President and Chief Financial Officer, Lexicon Pharmaceuticals: Thank you, Craig, and good morning, everyone. For the third quarter of 2025, we reported total revenue of $14.2 million compared to total revenue of $1.8 million for the third quarter of 2024. Q3 2025 revenue consisted primarily of $13.2 million of licensing revenue recognized from our agreement with Novo Nordisk. Licensing revenue under this agreement is being recognized as the IND enabling work is completed. Through September 30, 2025, a total of $40.7 million has been recognized as licensing revenue from this agreement, with the remaining $4.3 million expected to be recognized in Q4. Total revenue for the quarter also included net product revenue of $1 million from sales of Empefa.

Research and development expenses for the third quarter of 2025 decreased to $18.8 million from $25.8 million in Q3 2024, primarily reflecting lower external research expenses associated with the completion of our PROGRESS clinical trial, partially offset by increased investment in our Sonata phase 3 clinical trial in HCM. Selling, general, and administrative expenses for the third quarter of 2025 decreased to $7.6 million compared to $39.6 million in 2024. The continued decrease reflects lower costs as a result of our strategic repositioning in late 2024. Significantly reduced marketing efforts in 2025 for Empefa, as well as general diligence and focus on operating our business efficiently. Net loss for the third quarter of 2025 was $12.8 million, or $0.04 per share, as compared to a net loss of $64.8 million, or $0.18 per share in the corresponding period in 2024.

We ended the third quarter with $145 million in cash, short-term investments, and restricted cash as compared to $238 million as of December 31, 2024. I would also like to note a few other items from the quarter. On the expense side, we continue to reduce costs and streamline our operations. Quarter-over-quarter operating expenses decreased by $39.1 million, primarily due to the strategic repositioning as an R&D-focused company. We are maintaining our full year 2025 guidance for operating expenses. Total operating expenses are expected to remain between $105 million and $115 million, with R&D expenses projected to be between $70 million and $75 million. SG&A expenses are expected to range between $35 million and $40 million. Our R&D expense assumptions do not include costs associated with phase 3 pivotal studies of pilobafidin, as our goal would be to take this asset forward with a development partner.

Overall, we are in a strong position with the resources needed to advance our ongoing clinical programs while maintaining a disciplined approach to capital allocation and a focus on creating value for our shareholders. I will now turn it back to Mike for his closing remarks.

Mike Exton, Chief Executive Officer and Director, Lexicon Pharmaceuticals: Yeah, thanks, Scott. Look, you can see that we have achieved quite a lot already in 2025, and I’m excited about where we continue our strong execution to wrap up this year. As I shared earlier regarding pilobafidin, we’re planning for an end-of-phase 2 meeting by year’s end. Our preclinical work continues as we explore the broad potential value of this asset and evaluate expansion into additional indications. Additionally, a partnership with pilobafidin will allow us to become therapeutically focused on our core cardiometabolic programs and expertise. For SODA in HCM, we’re really excited to share results from complementary studies of SODA starting this upcoming weekend with AHA, which could provide valuable additional insights on this therapeutic candidate. In parallel, our Sonata study sites in the U.S., Europe, Israel, and Latin America are enrolling according to plan, with all phase 3 sites up and running.

For Empefa, our partner Viatris continues to make progress against plans for regulatory approval. Sotagliflozin was recently approved in United Arab Emirates and now is being submitted for approval in Saudi Arabia, Canada, Australia, and New Zealand, where there are a significant number of potential patients in need. In addition, Viatris has announced plans to submit for approval in additional markets, including Mexico and Malaysia, by the end of this year. That’s a total of six important markets to be filed by the end of the year, and we’re thrilled with the momentum that we’re building together with Viatris. For Zingquista, we’re working closely with the FDA on a potential path forward for T1D. The agency confirmed that they expect to provide written feedback by year’s end, and following alignment with the FDA, we’d work to submit our NDA as early as possible in 2026.

Finally, LX9851, our IND enabling studies for obesity have been completed, and we anticipate that Novo will expediently prepare and file the IND and advance into clinical development. Looking ahead to 2026, we plan to maintain focus on what we believe makes Lexicon well-positioned for success. We’ve got a strong pipeline of differentiated assets, not only first-in-class but first-to-market potential in therapeutic areas of high and mid need. We’re excited to embrace these opportunities and showcase what we achieve going into next year in our future updates. We’ve got time now for some Q&A, so I’ll turn it back over to the operator to manage the questions.

Conference Operator: Thank you very much. At this time, you will now conduct a question-and-answer session. As a reminder, to ask a question, you will need to press Star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press Star 11 again. Please stand by as we compile the Q&A roster. Our first question comes from the line of Andrew Tsai from Jefferies. Your line is now open.

Hey, guys. Good morning. Congrats on the progress. This is John on for Andrew. For Zingquista and type 1 diabetes, you’re seeking regulatory feedback in Q4. Are you looking for a simple yes or no, or just looking for whether a resubmission would make sense, or is there perhaps more color that you’re seeking? If you’re able to resubmit in 2026, would it be a Class 1 or Class 2 resubmission? Thanks.

Mike Exton, Chief Executive Officer and Director, Lexicon Pharmaceuticals: Yeah, thank you for the question, John. It’s Craig Granowitz. As Mike has mentioned and we’ve discussed previously, we’re really leveraging ongoing trials, particularly the Steno trial in Denmark, to use the exposure data in a very large number of patients to address the single concern that FDA raised at their end-of-review meeting, which is a prospective study to document rates of diabetic ketoacidosis. As you might recall, and as the CRL letter that was made public by the FDA a few months ago mentioned, FDA accepts that there is efficacy with this drug, has meaningful reductions in A1C, meaningful reductions in severe hypo effects, and obviously the proven outcome that we’ve already seen and the labeling we have in patients with type 1 diabetes and heart failure.

We are using the Steno trial with adequate levels of exposure, which is what we’re really discussing with the FDA, to prepare a submission really focused on that one single issue. To answer your second question, while we don’t have final written confirmation of this with the FDA, our expectation is that this would be, as a resubmission, a six-month review clock. Yeah, I think, John, just to provide a little more color from my side, I think what’s really pleasing here is that the FDA has endorsed and accepted that the Steno protocol and patients that they’re capturing are acceptable, and the way they’re capturing DKA is acceptable. As we move forward, it really is around appropriate exposure levels to be able to give them confidence that the positive data that we are seeing gives them confidence for a resubmission.

Great. Thanks so much. Maybe one more, if I can. For those third-party IST studies for sotagliflozin in HCM and HFpEF, how do you expect the non-HCM data to perhaps give you greater conviction in the phase 3 Sonata study success?

Yeah, it’s a great question. Clearly, there’s an overlap between HFpEF and HCM. From a clinical standpoint, they are, in essence, indistinguishable. You see a very similar profile. You have normal ejection fraction, but you have patients that have symptomatic dysfunction, particularly diastolic dysfunction. I think, as you’ve seen with the CMIs, they’re actually trying to go from HCM into HFpEF. I think they’re having some challenges with that because a lot of patients are then developing ejection fractions that are dropping below 50%. We believe that by demonstrating data, and you’ll see some of that as early as this weekend in the SODA CARDIA, which is an oral late breaker at AHA, as well as our continued mechanistic data that will be presented on tomorrow, actually Friday, at the HCM Society meeting.

We are distinguishing the effects of sotagliflozin in both the preclinical models, the animal models, on energetics and cardiac remodeling that will fit very nicely with some of the clinical results that you might be seeing in HFpEF patients that will be presented at the SODA CARDIA data on Saturday at HCM. It continues to build a wall of evidence that is similar between HFpEF and HCM regarding cardiac energetics, cardiac remodeling, cardiac fibrosis, and ultimately improved functionality and symptomatology in patients either with HFpEF or with HCM. John, again, allow me to sort of pile on there, I guess, more from a sort of commercial bent of how we see this. You know, we have this program in HCM for both obstructive and non-obstructive, thinking that a medicine that is an oral once daily, easy to use, and a well-known and understandable side effect profile.

Particularly given the data coming out of Maple. Really gives us a great opportunity potentially to work alongside CMIs, but in a first-line position in HCM. That first-line position, particularly as you’re sort of expanding outside of the HCM centers into retail cardiologists and large-scale cardiology practices, allows HFpEF and HCM. The patients present very similarly in those offices, and having SOTA as an option for both HFpEF and a differentiated option for HFpEF and HCM gives the cardiologist peace of mind that they can use this medicine very successfully in either condition, particularly in non-obstructive, where diagnosing the difference between the two is a little more challenging. Both from a utilization as well as scientifically, we continue to generate additional data that will help support the use of this in a broad range of cardiology patients in and across the cardiology community in the U.S.

Great. Thanks so much.

Conference Operator: All right. Our next question comes from the line of Igor Nokomovich from Citigroup. Your line is now open.

Hi. Good morning. Congrats on the progress. This is Joan Kim on for UGOL. Thanks for taking our question. Maybe just two quick ones from us. Regarding the partnership opportunity in DPNP, can you orient us on how far along you are in identifying a partner and remind us whether or not you are awaiting to complete the discussions from the end of phase 2 meeting with FDA before completing any partnership agreements?

Mike Exton, Chief Executive Officer and Director, Lexicon Pharmaceuticals: Yeah, that’s a great question. Over the last, I’d say, four to six weeks, we’ve re-engaged with a range of partners who we had originally discussed the top-line data with. Obviously, the data that we presented over the last month, including the totality of the phase 2 program, we’ve had the opportunity to talk with all of these partners. The end-of-phase 2 meeting is a very important milestone in those discussions. I think it’s fair to say in a space where there’s been nothing developed for two decades, in a space where new draft guidance has come out, it’s important to have that confirmation as a part of those overall discussions. We’re really looking forward now that that end-of-phase 2 meeting is scheduled for this year to continue to progress around that.

We feel very confident, actually, with the dossier that we’ve submitted and are really looking forward to having the FDA’s endorsement on what we think is a robust phase 3 program. That reflects their draft guidance, and that will certainly be a part of the partnering discussions that we’re having.

Got it. And just one more, if I may. Understanding that you’re seeking a broad HCM label, in your discussions with the FDA, have they suggested the possibility that you would also be able to get approval for specifically non-obstructive or obstructive HCM as data from Sonata is stronger in one particular subgroup?

Yeah, thank you. Very good question. We’re approaching it similar to how we approached heart failure, and we had a broad label for heart failure regardless of whether it was HFrEF or HFpEF. We’re really taking that same approach with the FDA, and the commitment we have on them when we met with them to discuss the protocol before initiating the trial was that this, if the study is positive, as conducted, would give us a label that would include both obstructive and non-obstructive patients. We are seeking that. We are looking to have two groups of 250 patients each within the study. There’s a stratification by obstructive versus non-obstructive, but the overall endpoint is anchored to the overall population.

Got it. Thanks so much. Appreciate it.

You’re welcome.

Conference Operator: Our next question comes from the line of Joe Pantginis from H.C. Wainwright. Your line is now open.

Analyst, H.C. Wainwright: Hey, everybody. Good morning. Thanks for taking the questions. A few as well, if you do not mind. First, I think it would be helpful if you remind us when Sonata moves forward and if it were to be positive, can you discuss the positioning, especially with the continued growing excitement in the HCM space and the role of CMIs and the hopefully upcoming approval of Afacamtin? Where would SOTA be positioned with regard to these other assets?

Mike Exton, Chief Executive Officer and Director, Lexicon Pharmaceuticals: Yeah, it’s a great question, Joe. I think it’s firstly important to note that patients, honestly, are actually eligible to enroll in Sonata. We’ve purposefully taken the approach, again, of using a very pragmatic trial that sotagliflozin can be used in conjunction with underlying meds that are used in hypertrophic cardiomyopathy. Now, where I would see the positioning is typical across a lot of chronic medications in as much as those medicines that are somewhat more laborious, somewhat more costly often, depending on sort of where it ranges, and are often positioned as sort of later lines in therapy. We would see sotagliflozin, as we discussed a little bit earlier, as being a broad potential, not only being used in the somewhat restrictive academic centers that have HCM study sites and clinical sites, but really across the broad scope of cardiology because it’s a known mechanism.

It’s easy to use. If we get positive results out of Sonata in both obstructive and non-obstructive, it allows this broad utilization. Particularly given the results of the Maple trial, which showed that, in fact, beta blockers do not necessarily add any value, and there is question as to whether, in fact, they may be causing some harm in HCM, I think that offers for us a really good opportunity to become a first-line agent in HCM, both obstructive and non-obstructive.

Mike, if you don’t mind, I just want to add one other point. I think it’s becoming more clear, Joe, and I think you’ve seen and heard some of these presentations even very, very recently, that all of the CMIs that are currently under regulatory review will have a REMS of some sort. That certainly does put significant paperwork and process in place for patients being initiated. I think that inherently is going to limit the sites that are willing to do that because you need to have a critical mass in order to create the paperwork flow. There will be many places that will have HCM patients in relatively low numbers that will not be willing to take on that burden.

I do think the fact that the CMIs will have REMS, and there might be differentiated REMS between them, but there will be what I would call significant limitations that are always a part of a REMS. We do not have any inclination that that would be the case with sotagliflozin, which is a well-known agent that has already an indication for heart failure.

Analyst, H.C. Wainwright: That’s really helpful. Thank you. I’ll just ask my last two questions together. First, with regard to the upcoming end-of-phase 2 study, you’ve already provided some nice details around that. I just want to make sure I understood. You already have a lot of great feedback. Is there anything you would describe as questions that are left to address or finalize? Number one. If Zingquista were to move forward on the regulatory front in a positive fashion, what kind of commercial plan would you potentially be looking at? Bringing it forward on yourself, a potential partner, or what have you?

Mike Exton, Chief Executive Officer and Director, Lexicon Pharmaceuticals: Right. I might throw the first one to Craig, and I’ll take the second one. Yeah, Joe, great question. On the end of phase 2, I think when it comes to the endpoint, the duration of the study, the patient population, I think we feel very comfortable with that. I think that’s been validated as well for other companies that are in phase 3 in neuropathic pain and diabetic neuropathic pain, that it will be two trials of roughly 300-350 patients each with a 12-week visual analog pain score with an average daily pain score outcome. I think with any centrally acting agent, some of the areas of discussion are going to be regarding potential for central effects such as drowsiness.

I think there’s always going to be a question with any agent in this regard, even though there is no reason to believe, and we don’t believe that there is any issue of human addiction potential type activities. We don’t believe that there are any meaningful or significant next-day drowsiness or other central effects of this agent. There is no indication in that large phase 2 program that we’ve run, including a blinded withdrawal, that there is any issue around addiction potential. Those certainly are areas that could be points of discussion with the FDA.

Right. No, thanks. I very much appreciate, Joe, the question on the commercialization of Zingquista, and to a degree also thinking forward for HCM. Just allow me a couple of moments here to talk a little bit more generally and philosophically about how we’re commercializing sotagliflozin. As you know, one of the first things that we did when I came into Lexicon was, unfortunately, having to re-look at how we commercialize Empefa. I want to state categorically that both Zingquista and for HCM are not going to be in Empefa situations for a couple of reasons. As you know, in Empefa, it was third to market, actually fourth really, in a space where there were three, particularly two major incumbents, and that made market access incredibly difficult.

What we’re seeing actually is that when physicians use this medicine and patients use them, it’s incredibly sticky, but access was a very difficult situation. That is not the case for Zingquista and HCM. Why is that? Because it will be the first and only SGLT inhibitor potentially indicated in each of these indications. That does a couple of things. First, it allows us to completely rethink pricing in both of these indications. And that has certain implications, particularly in HCM, where the CMIs are priced at a significant multiple to what other medicines are being used. Secondly, and perhaps more importantly, there’s not an ability at the payer level to substitute, to step through. The access conditions for Zingquista and HCM are very, very different. Now, that does not mean that we intend to go with a full-blown traditional commercial model.

In fact, that is part of our installing the INPEFA virtual sales support system that we have, which is all-encompassing. We will have an opportunity, perhaps, to talk you through that, which is a good way for us to learn over the coming months how we do this in a non-traditional way, whether that be a completely virtual field presence, whether that be looking at a hybrid, or whether it be even partnering on co-promotion, which could be an option. We are exploring all of these details in parallel. Of course, the other thing that makes us really excited is we have partnered with patient groups over years now, well before I joined the company. There are interesting commercial models that we can use and utilize some of this patient-driven advocacy.

Like, for example, in my experience, we’ve seen with migraine and other conditions where patients just have this built-up, pent-up demand, and we can do it in a very unique way. More to come on that, but we’re certainly exploring how we intend to potentially promote Zingquista should it come on the market.

Analyst, H.C. Wainwright: Guys, thank you so much for all the details. Especially on the last commentary, it sounds like you have the ability to leverage a lot of optionality. Thanks a lot.

Absolutely. Thanks, Joe.

Conference Operator: Our next question comes from the line of Yasmin Rahimi from Piper Sandler. Your line is now open.

Mike Exton, Chief Executive Officer and Director, Lexicon Pharmaceuticals: Hey, this is Dominic on for Yasmin Rahimi. Thank you for taking our question and congrats on a great quarter. We were looking at HCM. We know it’s going to be an exciting year this year, and especially considering that there’s going to be a few presentations on the SGLT1 and 2 inhibitor class in HCM and the preclinical models. Could you help us understand how much proof of concept data we could gain from these presentations in HCM? Thank you.

Yeah, thank you, Dominic. We look at any one of these presentations, and particularly a preclinical model, as part of a broader tableau around the mechanism of action. Particularly the functionality of both the SGLT1 and the SGLT2 effects of sotagliflozin, whether we’re looking at the effects on stroke and MI, whether we’re looking at the effects in HFpEF, or we’re looking at the effects in HCM. As you know, we’ve generated data on all of those over the past year and have published on that extensively. The data from the Boston group that will be presented tomorrow at the HCM meeting, I think, continues that narrative. In a particular murine model, this group has a lot of experience and a long track record.

The effects that they’ve seen with SODA in that model—I don’t want to presage their presentation, but I think are quite dramatic, and I’ll just sort of provide the overview—is that it’s affecting the energetics. There’s some mechanistic data around the energetics effects of SODA in that model. By affecting and improving cardiac energetics, you’re improving fibrosis and other cardiac remodeling, but most importantly, ultimately, diastolic function. As you know, the major physiologic issue in HCM is diastolic stiffness. There are really two main issues physiologically in human hypertrophic cardiomyopathy. In obstructive, there is a physical barrier to outflow tract obstruction, and that really is what distinguishes between obstructive and non-obstructive HCM. Fundamentally, the issue that is common, whether it’s obstructive or non-obstructive, is cardiac hyperdynamic function, that the actin and myosin are overly active. There’s also an issue around altered energetics.

We believe that sotagliflozin is acting on both of those fundamental physiologic characteristics. That is why we believe, and we had strong support from the medical community and the FDA, that we could study both obstructive and non-obstructive in the same trial because the underlying pathophysiology is the same. Regardless of whether they are obstructive or non-obstructive, which is really defined anatomically as opposed to physiologically.

Great. Thank you for the color. That was definitely helpful. We just had one more. Once pilavapadin’s end-of-phase 2 meeting is complete—and I know you touched on this a little bit earlier—how soon do you envision a partnership materializing? What are your thoughts on the type of deal that you could explore or you would be interested in?

Yeah, I think we will continue those engagements after the end-of-phase 2 meeting and certainly into the start of 2026. I think the type of partnership that we’re and the type of partners that we’re engaging with are really pretty diverse. I think that gives us optionality as to how we take our involvement with pilavapadin forward. We will continue to engage with them. We’ll wait for the minutes, obviously, to have that formalized, which will be in early 2026, and then we’ll take it from there.

Great. Thank you so much.

Thank you.

Conference Operator: I am showing no more further questions. We will now turn it over to Mike Exton, Chief Executive Officer of Lexicon, for closing remarks.

Thanks very much, everyone. Thanks for the great questions. I really enjoyed those and look forward to discussing in more detail with you soon. I think, and I hope that what you’ve seen is that this year, Lexicon Pharmaceuticals has really put our nose to the grindstone and focused on reshaping the company and advancing our pipeline forward. We have a number of great things happening in the next couple of months, really, as we close out the end of the year and into 2026. I look forward to sharing more information on all of those at future updates. Thanks very much and have a great day.

Thank you for your participation in today’s conference. This does conclude the program. You may now disconnect.