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J.P. Morgan 42nd Annual Healthcare Conference 2024

Jan 11, 2024

Colin Minicus
Investment Banking Associate, JPMorgan

Good morning, everyone. I'm Colin Minicus. I'm an associate here at J.P. Morgan's Healthcare Group. It's my pleasure to welcome Lexicon to the 42nd Annual J.P. Morgan Healthcare Conference. As just a quick reminder, we'll plan to hold Q and A at the end of today's session. Now, without further ado, please welcome CEO Lonnel Coats.

Lonnel Coats
CEO, Lexicon Pharmaceuticals

Thank you, Colin, and thank all of you who have made time to be here live at the conference, and for all of those who are on webcast. Today, I'll be making forward-looking statement, statements. Some of those statements certainly may have risk. I encourage you all to look at our SEC filings, where our risks are contained there. As always, I make these presentations on behalf of all of the extraordinary men and women at Lexicon that work tirelessly every day to translate our mission into helping patients live better lives. With that being said, let me move to the first slide and say, for those of you who do not know much about Lexicon, let me take a couple moments and give you a little bit of our rich history. You know, Lexicon has been around a long time.

We started off with being a major participant in looking at the foundational discoveries of the human genome. We started a project called Genome5000 program . It was a 10-year project, which was to systematically define the functions of approximately 5,000 genes in mammalian physiology and behavior. From that project, Lexicon identified over 100 targets that are currently in our library. From those targets, we've been able to build out a portfolio of compounds and ultimately a portfolio of drugs. For many of you who may not be aware, Lexicon has taken. In the 10 years I've been here, Lexicon has taken three compounds all the way from its discovery labs into development and now into market. The first, for those of you who may not know, was a compound called XERMELO. It was a compound used for neuroendocrine tumors for patients who had carcinoid diarrhea.

That compound was taken all the way through to market, approved, and entered the market in 2017, and we sold that compound to a company called TerSera in 2019. That allowed us to focus our resources from that sale on two additional compounds that have come out of the Lexicon's library as well. So let me talk to you about those two. First, I will say that 2023 was indeed a remarkable year because the first compound is our SGLT1 with an SGLT2, called INPEFA, that was approved by the FDA with a broad label for heart failure.

As a result of that, we went forward to hire tremendous talent in the cardiovascular space to commercialize INPEFA here in the United States, and I'm pleased to share with you today some of the results that we are seeing as we're entering now into our third quarter of launching INPEFA. The third asset, or the second one in 2024, but the third that's moving its way to market from our discovery labs, is a compound called LX9211 in diabetic peripheral neuropathic pain. LX9211 is a potent, orally delivered, selective small molecule inhibitor of adaptor-associated kinase, better known as AAK1. In preclinical studies for LX9211, it demonstrated reduction in pain behavior in multiple models of neuropathic pain without affecting the opioid pathways, and we all know how extremely important that is today.

What I'm going to be sharing with you today is continual development of LX9211 and the progress we're making with that. So let me jump in and talk to you about neuropathic pain. First, we know that there's an unmet medical need here, and then I'm gonna share with you the proof of concept that we achieved, and then the advancement of the clinical program that's currently underway. But let me start with a significant commercial opportunity. There are over 20 million Americans experiencing neuropathic pain, and approximately 5 million of those have diabetic peripheral neuropathic pain, therefore, making it the largest segment of neuropathic pain. The current standard of care does not eliminate neuropathic pain for most patients and may experience undesirable side effects.

LX9211 and the AAK1 target that we found, that I'll talk to you about here shortly, is an inhibition that represents a novel, non-opioid approach to treat neuropathic pain, with an opportunity to be the first drug with a new mechanism of action approved in neuropathic pain in over two decades. This potential to be first-to-market opportunity will be going into a large, multi-billion-dollar market that currently today is dominated by generics because there is no new innovation. So let's talk a little bit about LX9211 and how did we find this target, AAK1. Going back to this extraordinary work we did with the Genome5000, we went through all that work and looked at many different targets, including , Nav1.3, Nav1.7, Nav1.8, Nav1.9, and we chose AAK1.

The reason we did that intentionally, as you look at almost any of the pain models that we use, AAK1 shows significant impact on pain. To the left, if you look, the spinal nerve ligation model, you can clearly see in green, LX9211 or AAK1 certainly is blunting the pain. If you go down to the right here on the lower one, looking at the streptozotocin model, sorry, once again, LX9211 performs extremely well. Then you go to post-herpetic neuralgia. Once again, LX9211 performs consistently well. So we all know, we've been in this business long enough, that rat models don't always translate into human results. Therefore, we took the risk, and we went into phase II and did a phase III study to demonstrate whether this is going to pan out the way we did.

We ran a phase II study with three arms. We did a 100 mg loading dose because it's a long half-life, seven-day half-life, and we wanted to get the effect early, and then followed by a 10 mg dose thereafter. The second arm was 200 mg dose, followed by a 20 mg dose, and then the third arm was placebo. We truly believe a placebo is very, very important because we know in pain, everybody gets better. And therefore, you need to be able to show the margin by which you are going to get better to see the real activity of a compound like this. The other thing about this design is that we wanted to maintain patients who are on a stable dose of diabetic peripheral neuropathic pain meds. They could be on gabapentin, they could be on pregabalin, they could be on duloxetine.

It did not matter. They could stay on it as long as they were stable. We didn't wanna force patients off of these meds. Although these meds may not be providing optimal pain, it may be providing some benefit, and in the real world, that's basically how it's going to work, and therefore, we needed real-world results. So what did the results say? Well, LX9211 achieved its primary endpoint, clinically and statistically ensuring reductions in average daily pain score at week six. What I love about these data that you're looking at is that the effect of the ADPS was consistent across age, sex, and use of baseline diabetic peripheral neuropathic pain medications and baseline pain score. Ultimately, it didn't matter if you were on standard of care, you got a benefit. If you were de novo, you got a benefit.

Now, we know two things about patients living with diabetic neuropathic pain. One is that there's tremendous sleep interference, and two, they get this burning pain in their feet that disrupt their lives. And so we looked at it, and once again, what we show with LX9211 is for patients with burning pain, there was a significant and clinically meaningful benefit. And then, when you look at the baseline for interference in sleep, once again, LX9211 was statistically significant. Well, okay, so you got these great results. Well, because what did we learn? We learned that loading dose upfront may have been an overshoot, that we started to see some tolerability.

More specifically, in the early days of that loading dose, we saw more dizziness than we like to see, and as a result, we saw a higher dropout rate than what we like to see. Why is that important? Because the higher dropout rate, the more your efficacy gets muted. Therefore, we decided that we want to optimize the dose before we go into phase III, and that's what this PROGRESS trial is. It will be four arms: the 10-mg arm, which has already shown to be an effective dose that we can take forward into phase III, but we want to optimize it. It also would be a 20 mg dose, and then a third arm, because one of the other things that we learned is that the effect of LX9211 came on board in the first week.

If anyone knows anything about pain, about the other drugs in this marketplace, it can take three to four weeks before you see an effect. We saw it in the first week. We don't want to lose that, so we're testing whether we can maintain that first week by putting in this 20 mg dose for seven days and then 10 mg thereafter. And once again, we believe it's important to have a placebo-controlled study. So, in closing on LX9211, we have the potential to be the first-to-market opportunity with very few novel treatments. You can go try to find them. You're not gonna find them, and the other thing you're not gonna find is you're not gonna find very many successful compounds that have shown these results in phase II for diabetic peripheral neuropathic pain. We are truly in rarefied air.

It represents the largest, Diabetic peripheral neuropathic pain represents the largest growing neuropathic pain market in the United States, and the FDA feedback that we received in the second quarter of 2023 is now put into the design of the study. The program has been optimized for probability of success, time, and efficiency, and therefore, when we go into phase III, we're increasing our probability of success in this design. We anticipate to have top-line data in the second quarter of 2025. So let me move on to the next innovation that's come all the way from the discovery labs of Lexicon and now into market, and that's sotagliflozin for heart failure. Let me first say sotagliflozin is not just an SGLT2. Sotagliflozin is a combination of SGLT2 and an SGLT1, and we're gonna talk about why that's important in a moment.

It received a broad label for heart failure across the full range of left ventricular ejection fraction, including HFrEF, HFpEF, with or without diabetes. We saw a 33% risk reduction in a SOLOIST population for cardiovascular death, hospitalization, for heart failure, and urgent heart failure visits. And last but not least, we're launching into a market where the guidelines fully have made SGLT inhibition, inhibitors, the very foundation of treatment for heart failure. So let's talk a little bit about this, this market. There's approximately 6.7 million heart failure prevalence based on 2019 in the U.S. That number is gonna grow based on projections by 2030 to be more like 8.5 million.

It's the number one cause of admissions for hospitalizations for Americans older than 65, and there are about 1.3 million hospitalizations in the United States every year for heart failure. There's about 25% of these patients are gonna get readmitted after 30 days. 65% of these patients will be readmitted to the hospital within a year. So you can see the cycle of what the toll takes on patients, and more importantly, the toll it takes on the healthcare system. When we look at this foundation of care of the SGLTs, since the guidelines have come out, you've seen a 70% growth of SGLTs year-over-year. Importantly, what you see is only one out of 10 patients who have heart failure actually get an SGLT.

Given the strength of the data and the strength of the guidelines, you have a green field of opportunity for continued and sustainable growth, and given that INPEFA has a unique position in the marketplace, INPEFA will indeed take its rightful spot in that growth. And then when we project out to 2030, we're looking at an over $9 billion market. So let's get back to why INPEFA is so unique. INPEFA is not just an SGLT2, it's also an SGLT1. We know that SGLT2 is expressed in the kidney, and also, we know that SGLT1 is expressed in. It's a co-transporter expressed, in the absorption of glucose and galactose in the GI tract. So, why is this important? When you inhibit both these targets, what you're hoping to have is more synergistic effect. We know that SGLT1 is not just in the kidneys.

You see patients who have a reduction in SGLT1 in the variant. There's an improvement in heart failure, dilated cardiomyopathy, ischemic heart disease with or without type 2 diabetes, and diabetic cardiomyopathy. So let's talk about the results we see that look so uniquely different. Sorry, this is a Bill slide. All right, let me go back. Okay. All right, I'll just stay here. So let's go back to INPEFA reduced cardiovascular death and heart failure events by 50% over the first 30 and 90 days of discharge from the hospital. Why is this important? We have not seen this with any other SGLT2. This is important because it's important to the healthcare system, but what is most important, too, is patients don't have to be on this wagon wheel.

Now, we have a drug that's shown remarkable results. Now, we've got to take that message out to the community. So we've built 150 cardiovascular specialists that are well-trained and experienced in this area with a precision focus on the top prescribing cardiologists in the space. We're zeroing in on the, what we call this, A segment, and we're penetrating out from that A segment to try to capture as many of these targets as we can. But the focus really is on where the primary business is, which is the targets A and B, which represents 60% of the total TRX volume. So we have the reps that are very much focused on the message and the benefit of INPEFA. We also know that we cannot be successful without getting access.

And so the last quarter, you heard me say that we had about a 20% access. I'm very pleased to say we closed out the year with 43% access. So we see an improvement in access, a very precise focus on targets, and the question becomes: Does that lead to demand? If you recall the last quarter, you can see what we did in demand, demand being matched to what we see in claims. If we just look at Q4, which represents only October and November, it's already outstripped the last two quarter periods, and we don't have the December data yet, but we will give you the full data at our next earnings call. So we're very pleased with the progression of the demand.

Matched up to the demand, if you recall in the previous quarter, I talked about there were 400, a little over 400 prescribers. That number has almost tripled to over 1,200 prescribers finding reasons to believe with INPEFA. Now, INPEFA, I showed you again this unique mechanism, SGLT2 and SGLT1. We asked ourselves, are there other opportunities when we mine our data to develop INPEFA? Well, the answer to that is yes, and the opportunity that we'll be going for next will be hypertrophic cardiomyopathy. There's a strong scientific rationale for us to do that, and there's a significant market opportunity with minimal therapies that exist today.

It's estimated to be 1 million patients in the U.S., and we've gone to the FDA to get feedback on how best do we approach this, and then I'll talk to you a little bit about how we're gonna do it. So here's the rationale. When you go back and look at our data, when we pull our analysis, it didn't matter if you had HFrEF, HFpEF, HFmrEF.... this drug worked. And more importantly, is that when you get to the HFpEF section and look at the confidence intervals, you should be very confident you have a very powerful impact. When we look at these data, the question then became, a HFpEF patient ultimately can look like a HCM patient.

So we then looked at our SCORED data of 10,000 patients, mined that data, and then looked at a cohort of patients that share the same phenotypic and physiological traits of patients with HCM and may include undiagnosed cases of HCM. Now, this is left ventricular hypertrophy without hypertension, and it offers us a unique perspective as to whether or not we could go into HCM. Well, here are the results. When you look at cardiovascular death and heart failure-related events, you have a hazard ratio of 0.4. When you look at 3-point MACE, you have a hazard ratio of 0.52. When you look at 3-point MACE plus hospitalization for heart failure, you have a hazard ratio of 0.46. These are very powerful numbers that gave us great encouragement that we're on the right track to pursue HCM with INPEFA.

But, you know, we can say, well, whatever we wanna say, but it means we gotta go talk to KOLs, which we did, and we found they were absolutely enthused. Well, that's great. And then we had to go talk to the FDA and sought feedback from the FDA. Well, that feedback gave us great encouragement that we can pursue HCM. The primary endpoint has to be the change from baseline in KCCQ, which is a clinical summary scale. And the proposed indication that we will be pursuing is INPEFA is indicated to improve symptoms and physical limitations in adults with symptomatic hypertrophic cardiomyopathy. It'll be a 500-patient study, 250 in the sotagliflozin 400 mg arm and 250 in the placebo arm. We're very pleased of the feedback that we received.

We're very confident in what we have now seen, both in the data that we've mined, but we also know from our own KCCQ that we believe we can have a winner here. So what is the focus of Lexicon in 2024? We will further accelerate the launch of INPEFA for heart failure. We will advance LX9211 for diabetic peripheral neuropathic pain, and we will progress our opportunities for partnership, growth, and expansion. So let me talk about that with some... a little bit more color. Going back to what I said in the very beginning, this is a company with a deep scientific history of being able to bring products out of its own discovery labs all the way forward.

What we are now building out is a portfolio of cardiometabolic, assets and its complications that should put us in a position to partner and to grow. Starting with INPEFA, which we're now headed into our third quarter, and we're starting to see in leading indicators, we're getting a lift on INPEFA for heart failure. Followed by LX9211, which will be a novel, non-opioid target for diabetic peripheral neuropathic pain. But what is it? It's really a complications of patients living with type 2 diabetes, which is a metabolic issue.

And then sotagliflozin, I'm happy to tell you, it's kind of back to the past, is that we have now engaged with the FDA on looking for a pathway back for type 1 diabetes for sotagliflozin, and we've had a meeting with the agency, and there's receptivity, and we'll have a lot more to say about sotagliflozin for type 1 diabetes. And then, certainly, as I've already outlined, we will begin our work to go into late development with sotagliflozin with a single study for HCM. And because, again, we are a company that's fully integrated with a discovery engine, stay tuned because we'll be talking about a preclinical candidate that we found out of our library, which will be an obesity target. With that, I'll stop there, and thank you.

Colin Minicus
Investment Banking Associate, JPMorgan

Thank you, Lonnel. Now, we'd like to turn it over for any Q and A. Okay, well, maybe we'll go off of a few questions from our end. How do you see the neuropathic pain market subsequent to the Vertex data DPN disclosure?

Lonnel Coats
CEO, Lexicon Pharmaceuticals

Great question. First of all, I think anybody who's doing work in a CNS space, God bless you. It's a tough space to be in, and we're pleased that Vertex is staying in it because we need more players in this space. What I do think it has done is that it has brought more attention to this space that Lexicon, being a small company, may not be able to generate the attention. Just here at J.P. Morgan alone, since Vertex has put its, its announcement out, we're getting a lot more attention around LX9211 than we may have gotten previously. So I think it's been very, very helpful.

The other thing that's been very helpful is that when we look at how they are approaching this, particularly with their, with their Nav 1.8, there are some things we know about it, there are some things we know about their design, and what we conclude is that we're pretty much well on our way to having the success we think we will, and we'll have a very differentiated position.

Colin Minicus
Investment Banking Associate, JPMorgan

Great. Thank you.

Lonnel Coats
CEO, Lexicon Pharmaceuticals

You bet.

Speaker 5

Hi, a couple of questions. How much market exclusivity do you have on the sotagliflozin?

Lonnel Coats
CEO, Lexicon Pharmaceuticals

INPEFA?

Speaker 5

Yeah. Mark.

Lonnel Coats
CEO, Lexicon Pharmaceuticals

INPEFA will run through... Jeff, I'll let you answer that.

Jeffrey Wade
President and CFO, Lexicon Pharmaceuticals

It's with patent term extension, it'll be 2033 on the composition of matter patent.

Lonnel Coats
CEO, Lexicon Pharmaceuticals

We have some time.

Jeffrey Wade
President and CFO, Lexicon Pharmaceuticals

10 years.

Speaker 5

Okay, great. And with this ability to block the transporter in the intestine, does that change sort of like postprandial glycemia? Is that one of the advantages, and is there a downside in terms of GI side effects to those unabsorbed sugars get absorbed just later in the small intestine, or do they actually end up in the colon, and do people suffer from, you know, flatulence, diarrhea?

Lonnel Coats
CEO, Lexicon Pharmaceuticals

Great question. Craig, you wanna take that?

Craig Granowitz
CMO, Lexicon Pharmaceuticals

Yeah, thank you. I'm Craig Granowitz. I'm the Chief Medical Officer at Lexicon. Great question. As Lonnel went through in the slides, SGLT1 expression is much wider in the body, including the gut, endothelium, myocardium. We believe that that is directly related to why one plus two is greater than just SGLT2 alone. By blocking the uptake in the gut, we believe that gives us an inherent advantage in type 1 diabetes because you're both blocking, blunting the uptake of glucose, and you're treating it at the kidney 'cause you get all the benefits of SGLT2. What you've seen in the clinical trials and that were labeled, is that the side effects of Sota are quite similar to other SGLT2 inhibitors. There's a slight increase in mild diarrhea, but it's certainly not been either dose-limiting, and it's certainly not been an issue in the marketplace.

Just as long as I have your comments there, that's why we're also very excited in some of the slides Lonnel showed. We show a reduction both in MACE, which is MI and stroke, in that subgroup that Lonnel referenced, in addition to the heart failure endpoints. SGLT2 inhibitors alone don't show a reduction in heart, in stroke, in MI. And again, there is SGLT1 expression on the endothelium and the platelet. One last area is, if you look at the myocardium, there's also SGLT1 expression in the myocardium, so that has the benefits both in stroke and MI. The unprecedented results in a 50% reduction in 30-day readmission rates and a number needed to treat of four to avoid a cardiovascular death or heart failure event, and why we are increasingly confident that the data that Lonnel showed and our interest in HCM are well-founded.

So we do everything the SGLT2s do, but there are additional benefits that even if they were to develop their drugs, they probably couldn't touch, both in type 1 diabetes, stroke and MI, the rapid onset of reduction in heart failure events, and in HCM.

Speaker 5

Is the goal to have a prescription, have the patient start therapy during a heart failure admission? And how do you target those prescribers?

Jeffrey Wade
President and CFO, Lexicon Pharmaceuticals

So the answer to that is yes, eventually. Right now, all of our prescriptions are out in the community 'cause it takes time to get on hospital formularies. We're past the six-month new-to-market block for those, and so we're starting to have the discussions before the P&T committees of the hospitals. Ideally, because of the unique profile that we have on hospitalized patients, we'd like to get patients started either while they're still in the hospital for a couple of days before they're discharged or upon discharge.

Speaker 5

Mm-hmm.

Jeffrey Wade
President and CFO, Lexicon Pharmaceuticals

That's something that I think is really an upside opportunity for us because of the unique data that we have. The drug itself is beneficial to anybody that has heart failure, including patients who may have had a recent worsening heart failure event, people that come in to a doctor's office or a clinic with worsening symptoms.

Speaker 5

Have you looked at the effect of this drug on CKD progression in an animal model?

Jeffrey Wade
President and CFO, Lexicon Pharmaceuticals

So we actually, I'll let Craig answer this, but we presented some data on CKD at the American Society for Nephrology meeting that maybe, Craig, you can talk a little bit about.

Craig Granowitz
CMO, Lexicon Pharmaceuticals

Yeah, great question. Actually, ASN, the American Society of Nephrology, identified this as one of their most important abstracts in the 2023 meeting and actually put media out around that. What you see is a reduction in a number of the events related to renal outcomes, both in terms of UACR, eGFR, slope, and a number of other biomarkers that are all associated with preservation of renal function.

Speaker 5

Thanks. I'll stop hogging the mic.

Speaker 6

Yeah. I wonder, for the AAK1 product, how your product compared to the Vertex recently announced the positive phase II from efficacy and safety-wise. And I also wonder, because AAK1 is widely expressed target, how is your safety profile? And also, would you pursue any acute pain indication?

Lonnel Coats
CEO, Lexicon Pharmaceuticals

So I'll start with the last question and then turn the rest over to Dr. Granowitz. No, we do not have intention to go after acute pain. AAK1 target was an express target for neuropathic pain, and so we will probably go beyond diabetic peripheral neuropathic pain into other neuropathic pain categories like PHN and some others over time. But Dr. Granowitz?

Craig Granowitz
CMO, Lexicon Pharmaceuticals

Yeah, no, thank you for the question on the trial design. And, you know, our experience in doing studies in particularly neuropathic pain and chronic pain is there is a very high placebo rate, and it's particularly accentuated if you take patients off of all the underlying DPNP medications. So the fact that the trial design that Lonnel mentioned, both in terms of the phase II-A and now the PROGRESS study, is all the patients were allowed to continue on their baseline medications, which between a third and a half were on an underlying stable dose of a DPNP medication. We had a placebo control, which is critically important in these, and there was dose response and separation of the curve.

So the fact that some other studies that have been done don't have those attributes, I think it makes it somewhat difficult to interpret the effectiveness of the drug. With respect to your question on safety, we now have many hundreds of patients that have been treated with this drug, both single dose, rising multiple dose, and now two ongoing efficacy trials. And what we see and what we've reported is dizziness in a small number of patients, which seems to be very much dose-related. That's why we did the trial, the design of the PROGRESS study, without that day one tenfold higher dose. Because what we saw in that is we saw a very rapid onset of efficacy, which we think we're gonna be able to maintain with the current design.

But you saw that if you look in the detailed PK, that Cmax is associated with some mild to modest CNS effects, which immediately mitigate when you stop the drug. So it clearly seems to be both time and concentration dependent, and we feel at this point, we have a very good handle on where those breakpoints are, and they're well below the drug levels required to achieve efficacy.

Jeffrey Wade
President and CFO, Lexicon Pharmaceuticals

I'd also wanna mention that the market research we've done suggests that what is most desired among people who are treating people with neuropathic pain and people who have neuropathic pain is something that can be either used on its own or added into existing therapy. And so when someone is on an existing therapy, being able to use that in combination with a new innovative therapy would be the desired way to start, right? So it's not take them off of pregabalin, for example, and then put them on this drug. It would be to add it on top. Now, some other people may just not get benefit from those other drugs, and so they may want to be able to start it just on its own.

The great thing about this study, and that's unique about this study's design, is that we looked at all of that, and this is also something that we have aligned with the FDA, that that's what the phase III study will look like. So the study that we've done, the study that we're doing now, and the future phase III studies are all aligned in terms of what they will... in terms of what the regulatory pathway is, and in terms of the way that that this would actually be used in the marketplace and with what people want in terms of a new therapy.

Colin Minicus
Investment Banking Associate, JPMorgan

We've got a few questions on the iPad now. Abbott Labs began a clinical trial of a dual analyte, glucose plus ketone, continuous monitor, which it hopes to launch in 2025. Would this product presence afford Lexicon the ability to revisit Sota regulatory filing in Type 1 diabetes, and what clinical trial requirements might this entail?

Lonnel Coats
CEO, Lexicon Pharmaceuticals

So, as I've said, we're now engaged with the agency on T1D, and the engagement we're having with them is not on new clinical trials. It's really look at, given we have more data now on INPEFA, we have more data on SGLTs and how they behave, we think we have a real opportunity to find a patient population where there's an improved benefit when you add sotagliflozin onto insulin, control have better glycemic control and better outcomes. That's what we're having conversations with them. I do think a product like what Abbott is creating is very, very important for the market because I think it's important for Type 1s to be able to know what their ketones are, as well as what their glucose levels are for good health.

Colin Minicus
Investment Banking Associate, JPMorgan

Great. Thank you. One last question from the iPad as well. You mentioned composition of matter earlier today. Are there any plans to file Sota in the European Union as well?

Lonnel Coats
CEO, Lexicon Pharmaceuticals

Jeff?

Jeffrey Wade
President and CFO, Lexicon Pharmaceuticals

So you want me to take that?

Lonnel Coats
CEO, Lexicon Pharmaceuticals

Yep, it's yours.

Jeffrey Wade
President and CFO, Lexicon Pharmaceuticals

Our goal in, as Lexicon, is really to bring our innovations to market in the U.S. and to partner outside of the United States. And we are continuing to have discussions about different ex-U.S. markets. And I think one of the things that will be very interesting is when we're looking at the expanded opportunity, is how that may influence the thinking of potential ex-U.S. partners. So that's definitely something that we continue to look at, but would be done only with a partner.

Colin Minicus
Investment Banking Associate, JPMorgan

Understood. Thank you.

Speaker 7

Are you considering combination therapy of INPEFA for heart failure?

Lonnel Coats
CEO, Lexicon Pharmaceuticals

At the moment, no. You have some good ideas?

Speaker 7

Yeah. What about the combining the GLP-1?

Lonnel Coats
CEO, Lexicon Pharmaceuticals

Craig, your thoughts on combining with a GLP-1?

Craig Granowitz
CMO, Lexicon Pharmaceuticals

Yeah, I mean, it's... You've got a drug that's an injectable, right? The current drugs that have demonstrated significant efficacy with a once-a-day oral. I think they're really treating different diseases. The GLP-1s really have demonstrated benefit in two groups of patients: Those at high risk of progression to heart attack and stroke. That's the earlier data with the GLP-1s, and it reduces modestly, 10%-15%, heart attack and stroke. The second, and now more recently, the obesity, is now looking at both obesity and reduction in heart failure-related events. And again, the results are modest.

... I think they are real. The benefit clinically in terms of weight reduction in obese patients with HFpEF are notable, but if you look at hard outcomes data, you don't see a benefit in heart failure events. And in the large outcome study that's just been done and reported in New England Journal of Medicine, you see a modest reduction in three-point MACE, but none of the secondary endpoints beyond their primary were achieved. So if you look at the New England Journal, they're showing kind of the same thing that's been seen before, is a reduction in MACE events. With sotagliflozin in INPEFA, you see a reduction in heart failure-related events and stroke and MI, because we believe that there is an interaction between the SGLT1 benefits and those on the endothelium.

Plus, in data that we've published, if you compare an SGLT only- SGLT2 only inhibitor to sotagliflozin, you see more stimulation of the GLP or incretin axis with Sota than you see with the SGLT2. So we think you get actually a far broader range of medical benefits, as Lonnel showed in that slide, in the LVH with normal blood pressure you see on heart failure-related events and on MACE events.

Lonnel Coats
CEO, Lexicon Pharmaceuticals

Yes, they can be used together.

Speaker 7

Just a curious question. I think that both Lilly, as well as AstraZeneca, mentioned about the GLP1 combining, all the GLP1 combining with SGLT2 inhibitor. So obviously-

Lonnel Coats
CEO, Lexicon Pharmaceuticals

Powerful combination. Trying to formulate that would be probably the biggest challenge, but you got them both in the market today, so I see no reason why they cannot be used together.

Colin Minicus
Investment Banking Associate, JPMorgan

Great. Well, I think we're just about out of time. Thank you, Lonelle, and the rest of the team. Thank you all for coming out to another great week of the J.P. Morgan Healthcare Conference.

Lonnel Coats
CEO, Lexicon Pharmaceuticals

Excellent. Thank you.

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