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What changed in LEXICON PHARMACEUTICALS, INC.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of LEXICON PHARMACEUTICALS, INC.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+253 added−258 removedSource: 10-K (2025-03-07) vs 10-K (2024-03-25)

Top changes in LEXICON PHARMACEUTICALS, INC.'s 2024 10-K

253 paragraphs added · 258 removed · 195 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

69 edited+25 added−36 removed155 unchanged
Biggest changeWe are devoting most of our resources to the commercialization of our approved drug, INPEFA ® (sotagliflozin), for heart failure and the research and development of our most advanced drug candidates: • We are commercializing INPEFA, an orally-delivered small molecule drug, in the United States to reduce the risk of cardiovascular death, hospitalization for heart failure, and urgent heart failure visits in adults with heart failure or type 2 diabetes mellitus, chronic kidney disease, or CKD, and other cardiovascular risk factors.
Biggest changeWe have also reported positive results from a Phase 2a clinical trial of pilavapadin in DPNP and results from a separate Phase 2a clinical trial of pilavapadin in post-herpetic neuralgia which also demonstrated evidence of effect. • We are developing LX9851, an orally-delivered small molecule drug candidate, as a treatment for obesity and associated cardiometabolic disorders and are conducting preclinical development of LX9851 in preparation for filing an investigational new drug application, or IND, with the FDA. • We are commercializing INPEFA (sotagliflozin), an orally-delivered small molecule drug, in the United States to reduce the risk of cardiovascular death, hospitalization for heart failure, and urgent heart failure visits in adults with heart failure or type 2 diabetes mellitus, chronic kidney disease, or CKD, and other cardiovascular risk factors.
In the European Union, orphan designation is available for products in development which are either intended for the diagnosis, prevention or treatment of life-threatening or chronically debilitating conditions affecting not more than 5 in 10,000 persons in the European Union, or intended for the diagnosis, prevention or treatment of a life-threatening, seriously debilitating or serious and chronic condition 11 in the community and when, without incentives, it is unlikely that sales of the drug in the European Union would be sufficient to justify the necessary investment in developing the medicinal product.
In the European Union, orphan designation is available for products in development which are either intended for the diagnosis, prevention or treatment of life-threatening or chronically debilitating conditions affecting not more than 5 in 10,000 persons in the European Union, or intended for the diagnosis, prevention or treatment of a life-threatening, seriously debilitating or serious and chronic condition 10 in the community and when, without incentives, it is unlikely that sales of the drug in the European Union would be sufficient to justify the necessary investment in developing the medicinal product.
Central to the Cures Act are provisions that enhance and accelerate the FDA’s processes for reviewing and approving new drugs and supplements to approved NDAs, including provisions that: 10 • require the FDA to establish a program to evaluate the potential use of real world evidence to help support the approval of a new indication for an approved drug and to help support or satisfy post-approval study requirements; • provide that the FDA may rely upon qualified data summaries to support the approval of a supplemental application with respect to a qualified indication for an already approved drug; • require the FDA to issue guidance for purposes of assisting sponsors in incorporating complex adaptive and other novel trial designs into proposed clinical protocols and applications for new drugs; and • require the FDA to establish a process for the qualification of drug development tools for use in supporting or obtaining FDA approval for or investigational use of a drug.
Central to the Cures Act are provisions that enhance and accelerate the FDA’s processes for reviewing and approving new drugs and supplements to approved NDAs, including provisions that: 9 • require the FDA to establish a program to evaluate the potential use of real world evidence to help support the approval of a new indication for an approved drug and to help support or satisfy post-approval study requirements; • provide that the FDA may rely upon qualified data summaries to support the approval of a supplemental application with respect to a qualified indication for an already approved drug; • require the FDA to issue guidance for purposes of assisting sponsors in incorporating complex adaptive and other novel trial designs into proposed clinical protocols and applications for new drugs; and • require the FDA to establish a process for the qualification of drug development tools for use in supporting or obtaining FDA approval for or investigational use of a drug.
The primary efficacy endpoint under evaluation will be change from baseline in the patient-reported Kansas City Cardiomyopathy Questionnaire, or KCCQ, clinical summary score at 26 weeks, with secondary endpoints including change in KCCQ total symptom score and New York Heart Association class improvement at 26 weeks.
The primary efficacy endpoint under evaluation will be change from baseline in the patient-reported Kansas City Cardiomyopathy Questionnaire, or 3 KCCQ, clinical summary score at 26 weeks, with secondary endpoints including change in KCCQ total symptom score and New York Heart Association class improvement at 26 weeks.
We store API at third-party facilities in North America, and provide appropriate amounts to third-party drug product contract manufacturers in North America who then manufacture, package and label our specified quantities of finished commercial goods for INPEFA and clinical goods for our drug candidates.
We store API at third-party facilities in North America and Asia, and provide appropriate amounts to third-party drug product contract manufacturers in North America and Asia who then manufacture, package and label our specified quantities of finished commercial goods for INPEFA and clinical goods for our drug candidates.
Multiple Phase 2 clinical trials may be conducted to obtain information prior to beginning larger and more expensive Phase 3 clinical trials; and • Phase 3 clinical trials are conducted in larger patient populations at multiple clinical trial sites to obtain statistically significant evidence of the efficacy of the drug candidate for its intended use and to further test for safety in an expanded patient population. 8 In addition, the FDA may require, or companies may pursue, additional clinical trials after a product is approved.
Multiple Phase 2 clinical trials may be conducted to obtain information prior to beginning larger and more expensive Phase 3 clinical trials; and • Phase 3 clinical trials are conducted in larger patient populations at multiple clinical trial sites to obtain statistically significant evidence of the efficacy of the drug candidate for its intended use and to further test for safety in an expanded patient population. 7 In addition, the FDA may require, or companies may pursue, additional clinical trials after a product is approved.
Information found on our website should not be considered part of this annual report on Form 10-K. Alternatively, you may access these reports on the SEC’s website at www.sec.gov . Drugs and Drug Candidates We are devoting most of our resources to the commercialization of INPEFA and the research and development of sotagliflozin, LX9211 and LX9851.
Information found on our website should not be considered part of this annual report on Form 10-K. Alternatively, you may access these reports on the SEC’s website at www.sec.gov . Drugs and Drug Candidates We are devoting most of our resources to the research and development of pilavapadin, LX9851 and sotagliflozin and the commercialization of INPEFA.
LX9211 and another development candidate were discovered by scientists working within our drug discovery alliance with Bristol-Myers Squibb from which we hold exclusive development and commercialization rights. Preclinical studies of LX9211 demonstrated central nervous system penetration and reduction in pain behavior in models of neuropathic pain without affecting opiate pathways.
Pilavapadin and another development candidate were discovered by scientists working within our drug discovery alliance with Bristol-Myers Squibb from which we hold exclusive development and commercialization rights. Preclinical studies of pilavapadin demonstrated central nervous system penetration and reduction in pain behavior in models of neuropathic pain without affecting opiate pathways.
Our RELIEF-DPN-1 Phase 2 clinical trial enrolled 319 patients experiencing DPNP in a randomized, double-blind, placebo-controlled study of LX9211 evaluating three treatment groups receiving an initial loading dose of 100mg or 200mg of LX9211 or placebo, followed by once daily doses of 10mg or 20mg of LX9211 or placebo, respectively.
Our RELIEF-DPN-1 Phase 2 clinical trial enrolled 319 patients experiencing DPNP in a randomized, double-blind, placebo-controlled study of pilavapadin evaluating three treatment groups receiving an initial loading dose of 100mg or 200mg of pilavapadin or placebo, followed by once daily doses of 10mg or 20mg of pilavapadin or placebo, respectively.
Not only must a company have appropriate substantiation to support claims made about a drug, under the FDA’s current interpretation of relevant laws, a company can make only those claims relating to safety and efficacy that are for indications for which the FDA has approved the drug and are otherwise consistent with the FDA- 9 approved label for the drug.
Not only must a company have appropriate substantiation to support claims made about a drug, under the FDA’s current interpretation of relevant laws, a company can make only those claims relating to safety and efficacy that are for indications for which the FDA has approved the drug and are otherwise consistent with the FDA- 8 approved label for the drug.
We believe that our current manufacturing network has the appropriate capacity to produce sufficient commercial quantities of INPEFA and clinical quantities of sotagliflozin, LX9211, LX9851 and our other drug candidates. For business continuity reasons, we are establishing a backup supplier for the API necessary to manufacture commercial supplies of INPEFA.
We believe that our current manufacturing network has the appropriate capacity to produce sufficient commercial quantities of INPEFA and clinical quantities of pilavapadin, LX9851, sotagliflozin and our other drug candidates. For business continuity reasons, we are establishing a backup supplier for the API necessary to manufacture commercial supplies of INPEFA.
Topline data from the study showed a reduction from baseline to week 6 in ADPS of 2.42 points in the LX9211 arm, compared to a reduction of 1.62 points in the placebo arm (p=0.120 versus placebo), missing statistical significance in the study’s primary endpoint but demonstrating evidence of effect.
Topline data from the study showed a reduction from baseline to week 6 in ADPS of 2.42 points in the pilavapadin arm, compared to a reduction of 1.62 points in the placebo arm (p=0.120 versus placebo), missing statistical significance in the study’s primary endpoint but demonstrating evidence of effect.
Bristol-Myers Squibb has the first option to assume full responsibility for clinical development and commercialization of any drugs resulting from the alliance which enter clinical trials, other than LX9211 and additional compounds acting through AAK1, for which we hold exclusive development and commercialization rights under the alliance.
Bristol-Myers Squibb has the first option to assume full responsibility for clinical development and commercialization of any drugs resulting from the alliance which enter clinical trials, other than pilavapadin and additional compounds acting through AAK1, for which we hold exclusive development and commercialization rights under the alliance.
Patents and Proprietary Rights We can protect our proprietary rights from unauthorized use by third parties only to the extent that those rights are covered by valid and enforceable patents or are effectively maintained as trade secrets. Accordingly, patents and other proprietary rights are an essential element of our business.
Patents and Proprietary Rights We can protect our proprietary rights from unauthorized use by third parties only to the extent that those rights are claimed by valid and enforceable patents or are effectively maintained as trade secrets. Accordingly, patents and other proprietary rights are an essential element of our business.
The primary efficacy endpoint under evaluation in the study was the change from baseline to week 6 in average daily pain score, or ADPS, based on the 11-point numerical rating scale in patients treated with LX9211 compared with placebo.
The primary efficacy endpoint under evaluation in the study was the change from baseline to week 6 in average daily pain score, or ADPS, based on the 11-point numerical rating scale in patients treated with pilavapadin compared with placebo.
Consistent and statistically significant benefits in burning pain, pain interference with sleep and other measures of particular importance in DPNP were also observed in both LX9211 treatment arms as compared to placebo during the initial 6-week treatment period.
Consistent and statistically significant benefits in burning pain, pain interference with sleep and other measures of particular importance in DPNP were also observed in both pilavapadin treatment arms as compared to placebo during the initial 6-week treatment period.
Separation of LX9211 from placebo on ADPS was observed at week 1 and maintained consistently thereafter, with an average placebo-adjusted reduction over the 6-week treatment period of 0.80 points (p=0.031 versus placebo).
Separation of pilavapadin from placebo on ADPS was observed at week 1 and maintained consistently thereafter, with an average placebo-adjusted reduction over the 6-week treatment period of 0.80 points (p=0.031 versus placebo).
Our scientists identified the target of LX9211, adapter-associated kinase 1, or AAK1, in our target discovery efforts based on their discovery that mice lacking AAK1 exhibited increased resistance to induced neuropathic pain in preclinical models.
Our scientists identified the target of pilavapadin, adapter-associated kinase 1, or AAK1, in our target discovery efforts based on their discovery that mice lacking AAK1 exhibited increased resistance to induced neuropathic pain in preclinical models.
Compliance with such requirements can require 12 significant investment in personnel, systems and resources, but failure to properly calculate our prices, or offer required discounts or rebates could subject us to substantial penalties.
Compliance with such requirements can require 11 significant investment in personnel, systems and resources, but failure to properly calculate our prices, or offer required discounts or rebates could subject us to substantial penalties.
Similarly, our collaborators face similar competition from other competitors who may succeed in developing products 6 more quickly, developing products that are more effective than those developed by our collaborators or commercialize products more effectively and profitably than our collaborators.
Similarly, our collaborators face similar competition from other competitors who may succeed in developing products 5 more quickly, developing products that are more effective than those developed by our collaborators or commercialize products more effectively and profitably than our collaborators.
Our RELIEF-PHN-1 Phase 2 clinical trial enrolled 79 patients experiencing post-herpetic neuralgia, or PHN, in a randomized, double-blind, placebo-controlled study of LX9211 evaluating two treatment groups receiving an initial loading 4 dose of 200mg of LX9211 or placebo, followed by once daily doses of 20mg of LX9211 or placebo, respectively.
Our RELIEF-PHN-1 Phase 2 clinical trial enrolled 79 patients experiencing post-herpetic neuralgia, or PHN, in a randomized, double-blind, placebo-controlled study of pilavapadin evaluating two treatment groups receiving an initial loading dose of 200mg of pilavapadin or placebo, followed by once daily doses of 20mg of pilavapadin or placebo, respectively.
Congress and the executive branch have each indicated that it will 13 continue to seek new legislative and/or administrative measures to control drug costs, making this area subject to ongoing uncertainty.
Congress and the executive branch have each indicated that it will 12 continue to seek new legislative and/or administrative measures to control drug costs, making this area subject to ongoing uncertainty.
Type 1 Diabetes The FDA issued a complete response letter in March 2019 regarding our NDA for sotagliflozin in type 1 diabetes and confirmed that position in denying two appeals of the complete response letter in November 2019 and March 2020.
Type 1 Diabetes The FDA issued a complete response letter in March 2019 regarding our NDA for ZYNQUISTA in type 1 diabetes and confirmed that position in denying two appeals of the complete response letter in November 2019 and March 2020.
Mr. Crum was previously a corporate securities attorney with the law firms of Brobeck, Phleger & Harrison LLP and Andrews & Kurth L.L.P., where he represented companies in the energy and information technology industries. Mr. Crum received his B.B.A. and J.D. from the University of Texas. Thomas A.
Crum was previously a corporate securities attorney with the law firms of Brobeck, Phleger & Harrison LLP and Andrews & Kurth L.L.P., where he represented companies in the energy and information technology industries. Mr. Crum received his B.B.A. and J.D. from the University of Texas. Lisa M.
Manufacturing and Product Supply We do not own or operate manufacturing or distribution facilities or resources for commercial production and distribution of INPEFA or clinical production and distribution of sotagliflozin, LX9211, LX9851 or our other drug candidates.
Manufacturing and Product Supply We do not own or operate manufacturing or distribution facilities or resources for commercial production and distribution of INPEFA or clinical production and distribution of pilavapadin, LX9851, sotagliflozin or our other drug candidates.
Consistent with this approach, we seek to retain exclusive rights to the benefits of certain research and development programs by developing and commercializing drug candidates from those programs internally, particularly in the United States for indications treated by specialist physicians, as we have with INPEFA in the United States.
Consistent with this approach, we seek to retain exclusive rights to the benefits of certain research and development programs by developing and commercializing drug candidates from those programs internally, particularly in the United States for indications treated by specialist physicians.
The effects of LX9211 were assessed over an 11-week evaluation period, which included a 5-week placebo run-off period following the initial 6-week treatment period.
The effects of pilavapadin were assessed over an 11-week evaluation period, which included a 5-week placebo run-off period following the initial 6-week treatment period.
The effects of LX9211 were assessed over an 11-week evaluation period, which included a 5-week placebo run-off period following the initial 6-week treatment period. The primary efficacy endpoint under evaluation in the study was the change from baseline to week 6 in ADPS based on the 11-point numerical rating scale in patients treated with LX9211 compared with placebo.
The effects of pilavapadinwere assessed over an 11-week evaluation period, which included a 5-week placebo run-off period following the initial 6-week treatment period. The primary efficacy endpoint under evaluation in the study was the change from baseline to week 6 in ADPS based on the 11-point numerical rating scale in patients treated with pilavapadin compared with placebo.
Hypertrophic Cardiomyopathy We are preparing to initiate a Phase 3 clinical trial evaluating the safety and tolerability of sotagliflozin and its effects on HCM. The trial is expected to enroll approximately 500 patients experiencing obstructive or non-obstructive HCM in a randomized, double-blind, placebo-controlled study of a 400mg once daily dose of sotagliflozin over a 26-week treatment period.
Hypertrophic Cardiomyopathy We are conducting a Phase 3 clinical trial, SONATA HCM, evaluating the efficacy and safety of sotagliflozin and its effects on HCM. The trial is expected to enroll approximately 500 patients experiencing obstructive or non-obstructive HCM in a randomized, double-blind, placebo-controlled study of a 400mg once daily dose of sotagliflozin over a 26-week treatment period.
Preclinical studies of sotagliflozin demonstrated that compounds inhibiting both targets had a favorable preclinical profile relative to compounds selective for SGLT2. We use “INPEFA” when referring to our FDA-approved drug and “sotagliflozin” when referring to our development of INPEFA for type 1 diabetes, HCM and any additional indications.
Preclinical studies of sotagliflozin demonstrated that compounds inhibiting both targets had a favorable preclinical profile relative to compounds selective for SGLT2. We use “INPEFA” when referring to our FDA-approved drug, “sotagliflozin” when referring to our development for HCM and “ZYNQUISTA” when referring to our development for type 1 diabetes.
Main holds a B.S. from the University of Aberdeen, Scotland and a Ph.D. in organic chemistry from the University of Liverpool, England and completed postdoctoral studies at the Woodward Research Institute. Wendy E. McDermott has been our vice president, human resources since January 2022. Ms.
Main holds a B.S. from the University of Aberdeen, Scotland and a Ph.D. in organic chemistry from the University of Liverpool, England and completed postdoctoral studies at the Woodward Research Institute. Wendy E. McDermott has been our senior vice president, human resources since August 2024 and previously served as our vice president, human resources since January 2022. Ms.
All of our employees are located in the United States. None of our employees are represented by a labor union and we believe that our relationship with our employees is good. Our company culture is supported by our five core values: innovation, transparency, ownership, respect and integrity.
All of our employees are located in the United States. None of our employees are represented by a labor union and we believe that our relationship with our employees is good. Historically, we have had a relatively low turnover of employees. Our company culture is supported by our five core values: innovation, transparency, ownership, respect and integrity.
INPEFA, LX9851 and compounds from a number of additional drug programs originated from our own internal drug discovery efforts, and LX9211 originated from our collaborative neuroscience drug discovery efforts with Bristol-Myers Squibb.
Pilavapadin originated from our collaborative neuroscience drug discovery efforts with Bristol-Myers Squibb and LX9851, sotagliflozin and compounds from a number of additional drug programs originated from our own internal drug discovery efforts.
We own or exclusively license patents and patent applications throughout the world that claim our drugs and drug candidates, including: • issued patents and pending patent applications in Europe, the United States, and other countries throughout the world, including Australia, Argentina, Brazil, Canada, China, Europe, India, Israel, Japan, Mexico, New Zealand, South Africa, and South Korea, that claim INPEFA, crystalline forms of INPEFA, pharmaceutical compositions comprising INPEFA, and methods of its manufacture and use; • issued patents and pending patent applications in Europe, the United States, and other countries throughout the world, including Australia, Brazil, Canada, China, Europe, India, Israel, Japan, Mexico, New Zealand, South Africa, and South Korea, that claim LX9211, pharmaceutical compositions comprising LX9211, and methods of its use; and • a pending United States patent application that claims LX9851, pharmaceutical compositions comprising it, and methods of its manufacture and use.
We own or exclusively license patents and patent applications throughout the world that claim our drugs and drug candidates, including: • issued patents and pending patent applications in Europe, the United States, and other countries throughout the world, including Australia, Brazil, Canada, China, Europe, India, Israel, Japan, Mexico, New Zealand, South Africa, and South Korea, that claim pilavapadin, crystalline forms of pilavapadin, pharmaceutical compositions comprising pilavapadin, and methods of its manufacture and use; • pending United States and Patent Cooperation Treaty (PCT) patent applications that claim LX9851, pharmaceutical compositions comprising it, and methods of its manufacture and use; and • issued patents and pending patent applications in Europe, the United States, and other countries throughout the world, including Australia, Argentina, Brazil, Canada, China, Europe, India, Israel, Japan, Mexico, New Zealand, South Africa, and South Korea, that claim sotagliflozin, crystalline forms of sotagliflozin, pharmaceutical compositions comprising sotagliflozin, and methods of its manufacture and use.
In addition, we are entitled to receive clinical and regulatory milestone payments ranging, depending on the timing and extent of our efforts in the alliance, up to $76 million for each drug developed by Bristol-Myers Squibb under the alliance.
In addition, we are entitled to receive clinical and regulatory milestone payments ranging, depending on the timing and extent of our efforts in 4 the alliance, up to $76 million for each drug developed by Bristol-Myers Squibb under the alliance. We will also earn royalties on sales of drugs commercialized by Bristol-Myers Squibb under the alliance.
Significant Shareholders We have valuable relationships with Invus, L.P. and its affiliates, which we collectively refer to as Invus. Invus currently owns approximately 50% of the outstanding shares of our common stock. Human Capital Resources As of March 21, 2024, we employed 285 persons, of whom 22 hold M.D. or Ph.D. degrees and another 73 hold other advanced degrees.
Significant Shareholders We have valuable relationships with Invus, L.P. and its affiliates, which we collectively refer to as Invus. Invus currently owns approximately 50% of the outstanding shares of our common stock. Human Capital Resources As of February 28, 2025, we employed 103 persons, of whom 19 hold M.D. or Ph.D. degrees and another 33 hold other advanced degrees.
Bristol-Myers Squibb extended the target discovery term of the alliance in May 2006. We initiated the alliance with a number of neuroscience drug discovery programs at various stages of development and used our gene knockout technologies to identify additional drug targets with promise in the neuroscience field.
We initiated the alliance with a number of neuroscience drug discovery programs at various stages of development and used our gene knockout technologies to identify additional drug targets with promise in the neuroscience field.
We have completed two Phase 2 clinical trials evaluating the safety and tolerability of LX9211 and its effects on neuropathic pain.
We have completed three Phase 2 clinical trials evaluating the safety and tolerability of pilavapadin and its effects on DPNP and neuropathic pain.
We have also built an internal medical affairs function with responsibility for responding to external inquiries regarding the appropriate use of INPEFA with regularly updated and well-substantiated scientific and medical information.
Our internal medical affairs function maintains responsibility for responding to external inquiries regarding the appropriate use of INPEFA with regularly updated and well-substantiated scientific and medical information.
Our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 are made available free of charge on our corporate website located at www.lexpharma.com as soon as reasonably practicable after the filing of 1 those reports with the Securities and Exchange Commission, or the SEC.
Our corporate headquarters are located at 2445 Technology Forest Blvd., 11th Floor, The Woodlands, Texas 77381, and our telephone number is (281) 863-3000. 1 Our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 are made available free of charge on our corporate website located at www.lexpharma.com as soon as reasonably practicable after the filing of those reports with the Securities and Exchange Commission, or the SEC.
We expect that our principal competition for LX9211 for the treatment of DPNP would include duloxetine and pregabalin, which are currently marketed for the treatment of DPNP by Eli Lilly and Pfizer, respectively, and are also available as generics.
We expect that our principal competition for pilavapadin for the treatment of DPNP would include duloxetine and pregabalin, which are currently marketed for the treatment of DPNP by Eli Lilly and Pfizer, respectively, and are also available as generics. We may also experience competition from suzetrigine, which is currently being developed for DPNP by Vertex.
We rely on a sole source third party drug product contract manufacturer in the United States to manufacture, package and label finished drug product for commercial distribution of INPEFA, and are in the process of evaluating a backup supplier for our commercial INPEFA drug product.
We rely on a sole source third party drug product contract manufacturer in North America to manufacture, package and label finished drug product for commercial distribution of INPEFA, and have identified a backup supplier for our commercial INPEFA drug product.
The trial is expected to enroll approximately 416 patients with type 1 or type 2 diabetes and experiencing moderate to severe DPNP in a randomized, double-blind, placebo-controlled study evaluating three treatment groups receiving once daily LX9211 doses of 10mg, 20mg or 20mg for seven days followed by 10mg thereafter.
Our PROGRESS Phase 2b clinical trial enrolled 496 patients with type 1 or type 2 diabetes and experiencing moderate to severe DPNP in a randomized, double-blind, placebo-controlled study evaluating three treatment groups receiving once daily pilavapadin doses of 10mg, 20mg or 20mg for seven days followed by 10mg thereafter.
LX9211 LX9211 is an orally-delivered small molecule compound that we are developing as a treatment for neuropathic pain. We have received Fast Track designation from the FDA for development of LX9211 in DPNP.
We have also advanced a number of additional compounds into various stages of preclinical research and development. Pilavapadin (LX9211) Pilavapadin is an orally-delivered small molecule compound that we are developing as a treatment for neuropathic pain. We have received Fast Track designation from the FDA for development of pilavapadin in DPNP.
Such selective SGLT2 inhibitors include dapagliflozin and empagliflozin, currently marketed for the treatment of heart failure by AstraZeneca and through an alliance between Boehringer Ingelheim and Eli Lilly, respectively.
Our principal competition for INPEFA for the treatment of heart failure includes dapagliflozin and empagliflozin, currently marketed for the treatment of heart failure by AstraZeneca and through an alliance between Boehringer Ingelheim and Eli Lilly, respectively.
The primary efficacy endpoint under evaluation is the reduction in an average daily pain score at 8 weeks, with secondary endpoints including reduction in burning pain and reduction in pain interference on sleep at 8 weeks. Certain patient-reported outcome measures will also be assessed.
The primary efficacy endpoint under evaluation in the study was the reduction in an average daily pain score, or ADPS, from baseline to Week 8 as compared to placebo, with secondary endpoints including reduction in burning pain and reduction in pain interference on sleep at 8 weeks. Certain patient-reported outcome measures were also assessed.
LX9851 We are developing LX9851, an orally-delivered small molecule drug candidate, for the treatment of obesity and as a tool for weight management. We have commenced preclinical studies of the compound and its associated back-up molecules and are preparing to initiate clinical development.
LX9851 We are developing LX9851, an orally-delivered small molecule drug candidate, for the treatment of obesity and as a tool for weight management. We are conducting IND-enabling studies of the compound and its associated back-up molecules in preparation for filing an IND.
We also expect that we would experience competition from gabapentin, which is available as a generic and is frequently prescribed off-label for the treatment of DPNP.
We also expect that we would experience competition from gabapentin, which is available as a generic and is frequently prescribed off-label for the treatment of DPNP. We expect that our principal competition for LX9851 would include drugs approved for weight loss, including GLP-1 analogs and similar drugs.
The effects of LX9211 will be assessed over a 16-week evaluation period, which includes a screening period of up to two weeks and a blinded evaluation period of 14 weeks.
The effects of pilavapadin were assessed over a 16-week evaluation period, which included a screening period of two weeks and a blinded evaluation period of 14 weeks.
Kassler-Taub received his B.A. from Amherst College and M.D. from the Boston University School of Medicine. Alan J. Main, Ph.D . has been our executive vice president of innovation and chemical sciences since September 2020 and previously served in a series of manufacturing and scientific leadership positions since joining our company in 2001. Dr.
Main, Ph.D . has been our executive vice president of innovation and chemical sciences since September 2020 and previously served in a series of manufacturing and scientific leadership positions since joining our company in 2001. Dr.
We have agreed to pay Bristol-Myers Squibb up to $34.5 million in clinical and regulatory milestones for the first indication and up to $16 million in clinical and regulatory milestones for each of the second and third indications, if applicable.
Pilavapadin and another development compound acting through AAK1 were discovered by scientists working within our alliance with Bristol-Myers Squibb. We have agreed to pay Bristol-Myers Squibb up to $34.5 million in clinical and regulatory milestones for the first indication and up to $16 million in clinical and regulatory milestones for each of the second and third indications, if applicable.
We expect that upon acceptance of that application, an additional five years will be added to the term of a patent that claims INPEFA itself, pushing its expiration date out to 2033.
However, we have applied for an extension of patent term based on the FDA’s 13 approval of the drug and expect that upon acceptance of that application, an additional five years will be added to the term of a patent that claims sotagiflozin, pushing its expiration date out to 2033.
Wade is a member of the boards of directors of the Texas Healthcare and Bioscience Institute and BioHouston. He received his B.A. and J.D. from the University of Texas. Brian T. Crum has been our senior vice president and general counsel since October 2021 and previously served in a series of legal leadership positions since joining our company in 2001.
Corrigan received his B.A. from Boston College and J.D. from George Mason University School of Law. Brian T. Crum has been our senior vice president and general counsel since October 2021 and previously served in a series of legal leadership positions since joining our company in 2001. Mr.
Such selective SGLT2 inhibitors include dapagliflozin, empagliflozin and canagliflozin, currently marketed for the treatment of type 2 diabetes by AstraZeneca, through an alliance between Boehringer Ingelheim and Eli Lilly, and by Janssen (a subsidiary of Johnson & Johnson), respectively.
Such selective SGLT2 inhibitors include dapagliflozin, empagliflozin and canagliflozin, currently marketed for the treatment of type 2 diabetes by AstraZeneca, through an alliance between Boehringer Ingelheim and Eli Lilly, and by Janssen (a subsidiary of Johnson & Johnson), respectively. 6 Government Regulation Regulation in the United States The development, manufacture and sale of pharmaceutical products are subject to extensive regulation by United States governmental authorities, including federal, state and local authorities.
Adverse events were more frequent in the LX9211 treatment arms and at the higher dose during the initial 6-week treatment period, with the most common being dizziness, headache and nausea and nearly all being reported as mild or moderate.
During the blinded 5-week placebo run-off period, there was a gradual tapering of efficacy in both treatment arms with no evidence of rebound pain or withdrawal symptoms. 2 Adverse events were more frequent in the pilavapadin treatment arms and at the higher dose during the initial 6-week treatment period, with the most common being dizziness, headache and nausea and nearly all being reported as mild or moderate.
We have also advanced a number of additional compounds into various stages of preclinical research and development. INPEFA (sotagliflozin) INPEFA (sotagliflozin) is an orally-delivered small molecule compound that we are commercializing for heart failure and developing for type 1 diabetes and HCM.
Sotagliflozin Sotagliflozin is an orally-delivered small molecule compound that we are commercializing for heart failure and developing for HCM and type 1 diabetes.
None of our United States patents that claim LX9211 has a normal expiration date earlier than 2035. 14 All of our employees, consultants and advisors are required to execute a proprietary information agreement upon the commencement of employment or consultation.
All of our employees, consultants and advisors are required to execute a proprietary information agreement upon the commencement of employment or consultation.
Accordingly, we offer our employees a comprehensive compensation and benefits package that is competitive within the industry and make investing in the growth and development of our employees an important priority. Employee development is advanced through talent management, promotions, mentoring, stretch assignments, internships, formal training, speaker series, conferences, continuing education and educational reimbursement.
Accordingly, we offer our employees a comprehensive compensation and benefits package that is competitive within the industry and make investing in the growth and development of our employees an important priority.
We also seek to collaborate with other pharmaceutical and biotechnology companies, research institutes and academic institutions to capitalize on our drug target discoveries. Bristol-Myers Squibb We established a drug discovery alliance with Bristol-Myers Squibb Company in December 2003 to discover, develop and commercialize small molecule drugs in the neuroscience field.
Bristol-Myers Squibb We established a drug discovery alliance with Bristol-Myers Squibb Company in December 2003 to discover, develop and commercialize small molecule drugs in the neuroscience field. Bristol-Myers Squibb extended the target discovery term of the alliance in May 2006.
Research and Development Expenses In 2023, 2022 and 2021, respectively, we incurred expenses of $58.9 million, $52.8 million and $55.0 million in company-sponsored as well as collaborative research and development activities, including $5.1 million, $4.3 million and $4.3 million of stock-based compensation expense in 2023, 2022 and 2021, respectively. 16
Employee development is advanced through talent management, promotions, mentoring, stretch assignments, internships, formal training, speaker series, conferences, continuing education and educational reimbursement. 15 Research and Development Expenses In 2024, 2023 and 2022, respectively, we incurred expenses of $84.5 million, $58.9 million and $52.8 million in company-sponsored as well as collaborative research and development activities, including $5.8 million, $5.1 million and $4.3 million of stock-based compensation expense in 2024, 2023 and 2022, respectively. 16
Granowitz previously served as chief medical officer of Amarin Corporation plc since 2016. Prior to joining Amarin, Dr. Granowitz served as senior vice president and head of global medical affairs, global human health of Merck & Co., Inc. and in a 15 variety of medical and commercial management positions for Schering-Plough Corporation. Dr.
Granowitz served as senior vice president and head of global medical affairs, global human health of Merck & Co., Inc. and in a variety of medical and commercial management positions for Schering-Plough Corporation. Dr. Granowitz received his B.A. from Dartmouth College and his M.D. and Ph.D. from Columbia University. Alan J.
We are conducting a Phase 2b clinical trial of LX9211 in diabetic peripheral neuropathic pain, or DPNP, and have received Fast Track designation from the FDA for development of LX9211 in that indication.
We have reported top-line results from our Phase 2b clinical trial of pilavapadin in diabetic peripheral neuropathic pain, or DPNP, which demonstrated clear evidence of effect at the 10 mg dose and have received Fast Track designation from the U.S. Food and Drug Administration, or FDA, for development of pilavapadin in that indication.
Risk Factors.” Executive Officers Our executive officers and their ages and positions are listed below. Name Age Position with the Company Lonnel Coats 59 Chief Executive Officer and Director Jeffrey L. Wade 59 President and Chief Financial Officer Brian T. Crum 51 Senior Vice President and General Counsel Thomas A.
Risk Factors.” Executive Officers Our executive officers and their ages and positions are listed below. Name Age Position with the Company Michael S. Exton, Ph.D. 55 Chief Executive Officer and Director Scott M. Coiante 58 Senior Vice President and Chief Financial Officer Brian T. Corrigan 41 Senior Vice President, Regulatory and Quality Assurance Brian T.
At our request, the FDA issued a public Notice of Opportunity for Hearing, or NOOH, in March 2021 on whether there are grounds for denying approval of our NDA.
At our request, the FDA has issued a public Notice of Opportunity for Hearing, or NOOH, on whether there are grounds for denying approval of our NDA and those proceedings are ongoing. • We are conducting preclinical research and development of compounds from a number of additional drug programs originating from our internal drug discovery efforts.
Garner 48 Senior Vice President and Chief Commercial Officer Craig B. Granowitz, M.D., Ph.D. 59 Senior Vice President and Chief Medical Officer Kenneth B. Kassler-Taub, M.D. 67 Senior Vice President, Regulatory and Quality Assurance Alan J. Main, Ph.D. 70 Executive Vice President, Innovation and Chemical Sciences Wendy E. McDermott 53 Vice President, Human Resources Kristen L.
Crum 52 Senior Vice President and General Counsel Lisa M. DeFrancesco 46 Senior Vice President, Investor Relations and Corporate Communications Craig B. Granowitz, M.D., Ph.D. 60 Senior Vice President and Chief Medical Officer Alan J. Main, Ph.D. 71 Executive Vice President, Innovation and Chemical Sciences Wendy E. McDermott 54 Senior Vice President, Human Resources Kristen L.
We were incorporated in Delaware in July 1995, commenced operations in September 1995 and were listed on The Nasdaq Global Select Market in April 2000. Our corporate headquarters are located at 2445 Technology Forest Blvd., 11th Floor, The Woodlands, Texas 77381, and our telephone number is (281) 863-3000.
We were incorporated in Delaware in July 1995, commenced operations in September 1995 and were listed on The Nasdaq Global Select Market in April 2000.
We are separately pursuing regulatory approval of sotagliflozin as a treatment for type 1 diabetes. The U.S. Food and Drug Administration, or FDA, issued a complete response letter regarding our New Drug Application, or NDA, for sotagliflozin in type 1 diabetes in March 2019, which we appealed.
The FDA issued a complete response letter regarding our New Drug Application, or NDA, for sotagliflozin in type 1 diabetes in March 2019 and an additional complete response letter in December 2024 regarding our NDA for sotagliflozin as an adjunct to insulin therapy for glycemic control in adults with type 1 diabetes and CKD.
We are also developing sotagliflozin as a treatment for hypertrophic cardiomyopathy, or HCM, and are preparing to initiate a Phase 3 clinical trial of sotagliflozin in HCM. • We are developing LX9211, an orally-delivered small molecule drug candidate, as a treatment for neuropathic pain.
We are also developing sotagliflozin as a treatment for hypertrophic cardiomyopathy, or HCM, and are conducting a Phase 3 clinical trial of sotagliflozin in that indication. We are separately pursuing regulatory approval of ZYNQUISTA™ (sotagliflozin) as a treatment for type 1 diabetes.
We are conducting a Phase 2b clinical trial, PROGRESS, evaluating the safety and tolerability of LX9211 and its effects on DPNP.
We have completed three Phase 2 clinical trials ev aluating the safety and tolerability of pilavapadin and its effects on DPNP and neuropathic pain.
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Following FDA feedback from recent discussions, we are now preparing to resubmit our NDA for patients with type 1 diabetes and CKD. We have reported positive results from three Phase 3 clinical trials of sotagliflozin in type 1 diabetes.
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We are devoting most of our resources to the research and development of our most advanced drug candidates and the commercialization of our approved drug, INPEFA ® (sotagliflozin): • We are developing pilavapadin (LX 9211), an orally-delivered small molecule drug candidate, as a treatment for neuropathic pain.
Removed
We have reported positive results from a Phase 2 clinical trial of LX9211 in DPNP and top-line results from a separate Phase 2 clinical trial of LX9211 in post-herpetic neuralgia which also demonstrated evidence of effect. • We are conducting preclinical development of LX9851, an orally-delivered small molecule drug candidate, as a treatment for obesity and tool for weight management. • We are conducting preclinical research and development and preparing to conduct clinical development of compounds from a number of additional drug programs originating from our internal drug discovery efforts.
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Topline data from the study showed a reduction in ADPS from baseline to week 8 with the 10 mg, 20 mg/10 mg and 20 mg dose arms achieving reductions of 1.74, 1.70 and 1.38 respectively, compared to 1.31 in the placebo arm.
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We have a fully integrated commercial team consisting of sales, marketing, market access and commercial operations functions. Our sales force of approximately 150 cardiovascular specialty representatives is focused on promoting INPEFA to high-volume prescribers and institutions in the United States, concentrating their efforts on cardiologists specializing in heart failure.
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The study’s statistical analysis plan was designed to detect a dose-response signal based on a prespecified model that assumed separation of all treatment arms from placebo when measuring the primary endpoint.
Removed
Major cardiology societies in the United States and elsewhere have issued treatment guidelines recommending the use of SGLT inhibitors, such as INPEFA, as an important element in the standard of care for treating heart failure.
Added
As a result of the lack of separation in ADPS reduction between the 20 mg dose arm and placebo, the study results did not reach statistical significance on the primary endpoint (p=0.11).
Removed
SGLT inhibitors are the only class of therapy recommended by such treatment guidelines as a foundational treatment for heart failure regardless of left ventricular ejection fraction, with our Phase 3 SOLOIST-WHF study of INPEFA specifically cited as part of the basis for such recommendation.
Added
However, the 10 mg dose arm demonstrated clear evidence of effect by achieving early and clinically meaningful separation from placebo on ADPS that was maintained throughout the study duration. Adverse events were more frequent in the pilavapadin treatment arms, but were significantly improved from the RELIEF-DPN-1 study across all doses. Nearly all adverse events were reported as mild or moderate.
Removed
To ensure that all eligible patients in the United States have appropriate access to INPEFA, we have established a comprehensive reimbursement and support program called INPEFA Together ™ .

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

71 edited+17 added−18 removed180 unchanged
Biggest changeIf we fail to obtain such regulatory approval, our business will suffer and our stock price will likely decline. • We depend heavily on our ability to successfully complete and obtain positive results from our PROGRESS Phase 2b clinical trial of LX9211 in DPNP.
Biggest changeRisks Related to Our Business and Industry We depend heavily on our ability to successfully complete the ongoing research and development of our drug programs. If we fail to successfully complete and gain positive results from such research and development efforts, our business will suffer and our stock price will likely decline.
The laws that may affect our ability to operate include, without limitation: • the federal Anti-Kickback Statute, which constrains our marketing practices, educational programs, pricing policies, relationships with healthcare providers or other entities, and other business activities, by prohibiting, among other things, persons and entities from knowingly and willfully soliciting, receiving, offering or paying remuneration, directly or indirectly, in exchange for or to induce either the referral of an individual for, or the purchase, order or recommendation of, any good or service for which payment may be made under federal healthcare programs such as the Medicare and Medicaid programs; • federal civil and criminal false claims laws and civil monetary penalty laws, which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, claims for payment from Medicare, Medicaid, or other third-party payers that are false or fraudulent; • federal criminal laws that prohibit executing a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters; • state law equivalents of each of the above federal laws, such as anti-kickback and false claims laws which may apply to items or services reimbursed by any third-party payer, including commercial insurers, and state laws governing the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways and may not have the same effect, thus complicating compliance efforts; • the Foreign Corrupt Practices Act, a United States law which regulates certain financial relationships with foreign government officials (which could include, for example, certain medical professionals); • federal and state consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that potentially harm consumers; • state and federal government price reporting laws that require us to calculate and report complex pricing metrics to government programs, where such reported price may be used in the calculation of reimbursement and/or discounts on our marketed drugs (participation in these programs and compliance with the applicable requirements may subject us to potentially significant discounts on our products, increased infrastructure costs, and potentially limit our ability to offer certain marketplace discounts); and • state and federal expenditure tracking and reporting laws, which generally require certain types of expenditures in the United States to be tracked and reported.
The laws that may affect our ability to operate include, without limitation: • the federal Anti-Kickback Statute, which constrains our marketing practices, educational programs, pricing policies, relationships with healthcare providers or other entities, and other business activities, by prohibiting, among other things, persons and entities from knowingly and willfully soliciting, receiving, offering or paying remuneration, directly or indirectly, in exchange for or to induce either the referral of an individual for, or the purchase, order or recommendation of, any good or service for which payment may be made under federal healthcare programs such as the Medicare and Medicaid programs; • federal civil and criminal false claims laws and civil monetary penalty laws, which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, claims for payment from Medicare, Medicaid, or other third-party payers that are false or fraudulent; • federal criminal laws that prohibit executing a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters; • state law equivalents of each of the above federal laws, such as anti-kickback and false claims laws which may apply to items or services reimbursed by any third-party payer, including commercial insurers, and state laws governing the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways and may not have the same effect, thus complicating compliance efforts; • the Foreign Corrupt Practices Act, a United States law which regulates certain financial relationships with foreign government officials (which could include, for example, certain medical professionals); • federal and state consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that potentially harm consumers; 21 • state and federal government price reporting laws that require us to calculate and report complex pricing metrics to government programs, where such reported price may be used in the calculation of reimbursement and/or discounts on our marketed drugs (participation in these programs and compliance with the applicable requirements may subject us to potentially significant discounts on our products, increased infrastructure costs, and potentially limit our ability to offer certain marketplace discounts); and • state and federal expenditure tracking and reporting laws, which generally require certain types of expenditures in the United States to be tracked and reported.
The degree of market acceptance of such products will depend upon a number of factors, including: • the effectiveness, or perceived effectiveness, of our products in comparison to competing products; • the existence of any significant side effects, as well as their severity in comparison to any competing products; • potential advantages or disadvantages in relation to alternative treatments; • current and future indications for which our products may be approved; • the ability to offer our products for sale at competitive prices; • relative convenience and ease of administration; • the strength of marketing and distribution support; and • sufficient third-party coverage or reimbursement.
The degree of market acceptance of such products will depend upon a number of factors, including: • the effectiveness, or perceived effectiveness, of our products in comparison to competing products; • the existence of any significant side effects, as well as their severity in comparison to any competing products; • potential advantages or disadvantages in relation to alternative treatments; • current and future indications for which our products may be approved; • the ability to offer our products for sale at competitive prices; • relative convenience and ease of administration; • the strength of marketing and distribution support; and 19 • sufficient third-party coverage or reimbursement.
Our insurance coverage may not be sufficient to prevent or recover from cyberattacks, including coverage of applicable resulting losses arising from the incident. Further, each foreign jurisdiction and U.S. state in which we operate may have laws governing how we must respond to a cyber incident that results in the unauthorized access, disclosure, or loss of personal information.
Our insurance coverage may not be sufficient to prevent or recover from cyberattacks, including coverage of applicable resulting losses arising from the incident. Each foreign jurisdiction and U.S. state in which we operate may have laws governing how we must respond to a cyber incident that results in the unauthorized access, disclosure, or loss of personal information.
If milestones are not achieved or our collaborators are unable to successfully develop and 27 commercialize products from which milestones and royalties are payable, we will not earn the revenues contemplated by those arrangements. We have limited or no control over the resources that any third party may devote to the development and commercialization of products under our collaborations.
If milestones are not achieved or our collaborators are unable to successfully develop and commercialize products from which milestones and royalties are payable, we will not earn the revenues contemplated by those arrangements. We have limited or no control over the resources that any third party may devote to the development and commercialization of products under our collaborations.
We currently do not have the manufacturing capabilities or experience necessary to produce commercial supplies of INPEFA and any other products which gain regulatory approval and other materials for our research and development activities relating to our drug candidates and intend in the future to continue to rely on collaborators and third-party contractors to produce such materials.
We currently do not have the manufacturing capabilities or experience necessary to produce commercial supplies of INPEFA and any other products which gain regulatory approval and other materials for our research and development activities relating to our drug candidates and intend in the future to continue to rely on collaborators and third-party contractors to 27 produce such materials.
In addition, many countries limit the enforceability of patents against government agencies or government contractors. In these countries, the patent owner may have limited remedies, which could materially diminish the value of the patent. Compulsory licensing of life-saving drugs is also becoming increasingly popular in developing countries either through direct legislation or international initiatives.
In addition, many countries limit the enforceability of patents 28 against government agencies or government contractors. In these countries, the patent owner may have limited remedies, which could materially diminish the value of the patent. Compulsory licensing of life-saving drugs is also becoming increasingly popular in developing countries either through direct legislation or international initiatives.
It is often difficult to anticipate or immediately detect such incidents and the damage caused by such incidents, particularly for cyber incidents such as advanced persistent threats. These data breaches and any unauthorized access or disclosure of our information or intellectual property could compromise our 30 intellectual property and expose sensitive business information.
It is often difficult to anticipate or immediately detect such incidents and the damage caused by such incidents, particularly for cyber incidents such as advanced persistent threats. These data breaches and any unauthorized access or disclosure of our information or intellectual property could compromise our intellectual property and expose sensitive business information.
In such event, our capital needs will be substantially higher and we will be reliant on obtaining financing in support of any such Phase 3 development program from alternative sources. We cannot be certain that such financing will be available in amounts or on terms acceptable 25 to us, if at all.
In such event, our capital needs will be substantially higher and we will be reliant on obtaining financing in support of any such Phase 3 development program from alternative sources. We cannot be certain that such financing will be available in amounts or on terms acceptable to us, if at all.
We have increased our commercial, medical, clinical, and other personnel, and recruiting and retaining qualified individuals is difficult. If we are unable to manage our growth effectively, or are unsuccessful in recruiting or retaining qualified personnel when advisable, our business, financial condition, results of operations and prospects may be adversely affected.
We have increased our commercial, medical, clinical, and other personnel, and recruiting and retaining qualified 30 individuals is difficult. If we are unable to manage our growth effectively, or are unsuccessful in recruiting or retaining qualified personnel when advisable, our business, financial condition, results of operations and prospects may be adversely affected.
Factors that may hinder efforts to effectively establish, manage and maintain such infrastructure for products that we or our collaborators may develop include: • inability to recruit, retain and effectively manage adequate numbers of effective sales and marketing personnel; 20 • inability to maintain relationships with third-party logistics providers, pharmacies, third-party manufacturers and other third parties instrumental in the commercial manufacture and distribution of such products; • inability to establish or implement internal controls and procedures required in connection with sales of such products; • inability of sales personnel to obtain access to or convince adequate numbers of physicians to prescribe such products; and • potential lack of complementary products to be offered by sales personnel, which may put us or our collaborators at a competitive disadvantage relative to companies with more extensive product lines.
Factors that may hinder efforts to effectively reestablish, manage and maintain such infrastructure for products that we or our collaborators may develop include: • inability to recruit, retain and effectively manage adequate numbers of effective sales and marketing personnel; • inability to maintain relationships with third-party logistics providers, pharmacies, third-party manufacturers and other third parties instrumental in the commercial manufacture and distribution of such products; • inability to establish or implement internal controls and procedures required in connection with sales of such products; • inability of sales personnel to obtain access to or convince adequate numbers of physicians to prescribe such products; and • potential lack of complementary products to be offered by sales personnel, which may put us or our collaborators at a competitive disadvantage relative to companies with more extensive product lines.
Third-party payers are challenging the prices charged for medical products and services, and many third-party payers limit reimbursement for newly approved health care products. In particular, third-party payers may limit the indications for which they will reimburse patients who use any products that we or our collaborators may develop.
Third-party payers are challenging the prices charged for medical products and services, and many third-party payers limit reimbursement for newly approved health care products. In particular, third-party payers may limit the indications for which they will reimburse patients who use any 20 products that we or our collaborators may develop.
The failure to achieve and maintain these high manufacturing standards, including the incidence of manufacturing errors, could result in patient injury or death, 21 product recalls or withdrawals, delays or failures in product testing or delivery, cost overruns or other problems that could seriously hurt our business.
The failure to achieve and maintain these high manufacturing standards, including the incidence of manufacturing errors, could result in patient injury or death, product recalls or withdrawals, delays or failures in product testing or delivery, cost overruns or other problems that could seriously hurt our business.
The United States and some foreign jurisdictions are considering or have enacted a number of legislative and regulatory proposals, such as the Inflation Reduction Act, that may have the effect of reducing the prices that we are able to 23 charge for products we or our collaborators may develop.
The United States and some foreign jurisdictions are considering or have enacted a number of legislative and regulatory proposals, such as the Inflation Reduction Act, that may have the effect of reducing the prices that we are able to charge for products we or our collaborators may develop.
We may be unable to raise sufficient additional capital on reasonable terms, and if so, we will be forced to delay, reduce or eliminate our clinical development programs or commercialization efforts or obtain funds, if at all, by entering into financing agreements on unattractive terms.
We may be unable to raise sufficient additional capital on reasonable terms, and if so, we will be forced to delay, reduce or eliminate our 24 clinical development programs or commercialization efforts or obtain funds, if at all, by entering into financing agreements on unattractive terms.
If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may lose any marketing approval that we otherwise may have obtained and we may not achieve or sustain profitability.
If we are 22 slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may lose any marketing approval that we otherwise may have obtained and we may not achieve or sustain profitability.
Risks Related to Our Employees and Facilities If we are unable to manage our growth, our business, financial condition, results of operations and prospects may be adversely affected. We have experienced and may continue to experience substantial growth in the number of our employees and in the scope of our operations.
Risks Related to Our Employees and Facilities If we are unable to manage our business, financial condition, results of operations and prospects may be adversely affected. In the past we have experienced and may continue to experience substantial growth in the number of our employees and in the scope of our operations.
We have also outsourced significant elements of our information technology infrastructure and, as a result, third parties may or could have access to our confidential information and personal data. The secure maintenance of this information is critical to our business and reputation.
We have outsourced significant elements of our information technology infrastructure and, as a result, third parties may or could have access to our confidential information and personal data. The secure maintenance of this information is critical to our business and reputation.
If one or more of these analysts cease coverage of our company or fail to publish reports on us regularly, demand for our common stock could decrease, which might cause our stock price and trading volume to decline.
If one or more of these analysts 33 cease coverage of our company or fail to publish reports on us regularly, demand for our common stock could decrease, which might cause our stock price and trading volume to decline.
While we seek to protect our proprietary information by entering into confidentiality agreements with employees, collaborators and consultants, we cannot assure you that our proprietary information will not be disclosed, or that we can 29 meaningfully protect our trade secrets.
While we seek to protect our proprietary information by entering into confidentiality agreements with employees, collaborators and consultants, we cannot assure you that our proprietary information will not be disclosed, or that we can meaningfully protect our trade secrets.
In addition, we or our collaborators must manufacture, or contract for the manufacture of, the drug candidates that we use in our clinical trials under the FDA’s cGMP requirements. The rate of completion of clinical trials is dependent, in part, upon the rate of enrollment of patients.
In addition, we or our collaborators must manufacture, or contract for the manufacture of, the drug candidates that we use in our clinical trials under the FDA’s cGMP requirements. 18 The rate of completion of clinical trials is dependent, in part, upon the rate of enrollment of patients.
In addition, significant disruption in the operations of third party manufacturers and research and development organizations upon whom we rely may occur and, as a result, our business operations could be severely impacted.
In addition, significant disruption in the operations of third party manufacturers and research and development organizations upon whom we rely may occur and, as a result, our business operations could be 23 severely impacted.
If we are unable to establish a strategic collaboration or other arrangement for that purpose, our capital needs will be substantially higher and we may be unable to obtain financing sufficient to fund Phase 3 development of LX9211 on acceptable terms, or at all, and may be required to forego or reduce the scope of any such Phase 3 development program. • We have a history of net losses, and we expect to continue to incur net losses and may not achieve or maintain profitability.
If we are unable to establish a strategic collaboration or other arrangement for that purpose, our capital needs will be substantially higher and we may be unable to obtain financing sufficient to fund Phase 3 development of pilavapadin on acceptable terms, or at all, and may be required to forego or reduce the scope of any such Phase 3 development program. • We have a history of net losses, and we expect to continue to incur net losses and may not achieve or maintain profitability.
If we are unable to establish a strategic collaboration or other arrangement for that purpose, our capital needs will be substantially higher and we may be unable to obtain financing sufficient to fund Phase 3 development of LX9211 on acceptable terms, or at all, and may be required to forego or reduce the scope of any such Phase 3 development program.
If we are unable to establish a strategic collaboration or other arrangement for that purpose, our capital needs will be substantially higher and we may be unable to obtain financing sufficient to fund Phase 3 development of pilavapadin on acceptable terms, or at all, and may be required to forego or reduce the scope of any such Phase 3 development program.
A number of factors, many of which we cannot control, could subject our operating results to volatility, including: • the success of our commercialization of INPEFA for the treatment of heart failure; • the success of our ongoing research and development efforts and our ability to obtain regulatory approval of our drug candidates as a result of such efforts; • the timing and amount of expenses incurred with respect to our research, development and commercialization efforts; • our success in establishing new collaborations and technology licenses and the timing and financial terms of such arrangements; • the timing and willingness of our collaborators to commercialize pharmaceutical products that would result in milestone payments and royalties; • disputes or other developments relating to proprietary rights, including patents, litigation matters and our ability to obtain patent protection for our products and technologies; and • general and industry-specific economic conditions, which may affect our and our collaborators’ research and development expenditures.
A number of factors, many of which we cannot control, could subject our operating results to volatility, including: • the success of our ongoing research and development efforts and our ability to obtain regulatory approval of our drug candidates as a result of such efforts; • the timing and amount of expenses incurred with respect to our research, development and commercialization efforts; • our success in establishing new collaborations and technology licenses and the timing and financial terms of such arrangements; • the timing and willingness of our collaborators to commercialize pharmaceutical products that would result in milestone payments and royalties; 25 • disputes or other developments relating to proprietary rights, including patents, litigation matters and our ability to obtain patent protection for our products and technologies; and • general and industry-specific economic conditions, which may affect our and our collaborators’ research and development expenditures.
The trading price of our common stock has been highly volatile, and we believe the trading price of our common stock will remain highly volatile and may fluctuate substantially due to factors such as the following, many of which we cannot control: • the commercial success of INPEFA and the revenues we generate from sales of INPEFA; • results or delays in our or our collaborators’ clinical trials; • the announcement of FDA approval or non-approval, or delays in the FDA review process, of our or our collaborators’ drug candidates or those of our competitors or actions taken by regulatory agencies with respect to our, our collaborators’ or our competitors’ clinical trials; • actions taken by regulatory agencies with respect to sotagliflozin, LX9211, LX9851 and our other drug candidates; • the announcement of new products by our competitors; • quarterly variations in our or our competitors’ results of operations; • developments in our relationships with our collaborators, including conflicts, litigation or the termination or modification of our agreements; • the announcement of an in-licensed drug candidate or strategic acquisition; • litigation, including intellectual property infringement and misappropriation, and product liability lawsuits, involving us; 33 • failure to achieve operating results projected by securities analysts; • changes in earnings estimates or recommendations by securities analysts; • the satisfaction of outstanding debt obligations or entry into new financing arrangements; • developments in the biotechnology or pharmaceutical industry; • sales of large blocks of our common stock or sales of our common stock by our executive officers, directors and significant stockholders; • departures of key personnel or board members; • FDA or international regulatory actions; • third-party coverage and reimbursement policies; • disposition of any of our drug programs or other technologies; and • other factors, including general market, economic and political conditions and other factors unrelated to our operating performance or the operatin g performance of our competitors.
The trading price of our common stock has been highly volatile, and we believe the trading price of our common stock will remain highly volatile and may fluctuate substantially due to factors such as the following, many of which we cannot control: • actions taken by regulatory agencies with respect to pilavapadin, LX9851, sotagliflozin and our other drug candidates; • results or delays in our or our collaborators’ clinical trials; • the announcement of FDA approval or non-approval, or delays in the FDA review process, of our or our collaborators’ drug candidates or those of our competitors or actions taken by regulatory agencies with respect to our, our collaborators’ or our competitors’ clinical trials; • the announcement of new products by our competitors; • quarterly variations in our or our competitors’ results of operations; 32 • developments in our relationships with our collaborators, including conflicts, litigation or the termination or modification of our agreements; • the announcement of an in-licensed drug candidate or strategic acquisition; • litigation, including intellectual property infringement and misappropriation, and product liability lawsuits, involving us; • failure to achieve operating results projected by securities analysts; • changes in earnings estimates or recommendations by securities analysts; • the satisfaction of outstanding debt obligations or entry into new financing arrangements; • developments in the biotechnology or pharmaceutical industry; • sales of large blocks of our common stock or sales of our common stock by our executive officers, directors and significant stockholders; • departures of key personnel or board members; • FDA or international regulatory actions; • third-party coverage and reimbursement policies; • disposition of any of our drug programs or other technologies; and • other factors, including general market, economic and political conditions and other factors unrelated to our operating performance or the operatin g performance of our competitors.
Competition is intense for experienced commercial, medical and clinical personnel, and we may be unable to retain or recruit such personnel with the 31 expertise or experience necessary to allow us to successfully develop and commercialize our products. Further, all of our employees are employed “at will” and, therefore, may leave our employment at any time.
Competition is intense for experienced personnel, and we may be unable to retain or recruit such personnel with the expertise or experience necessary to allow us to successfully develop and commercialize our products. Further, all of our employees are employed “at will” and, therefore, may leave our employment at any time.
If we are unable to establish such collaborations, or if pharmaceutical products are not successfully and timely developed and commercialized under such collaborations, our opportunities to generate revenues from our other drug candidates will be greatly reduced.
If we are unable to establish such collaborations or arrangements, or if pharmaceutical products are not successfully and timely developed and commercialized under such collaborations or arrangements, our opportunities to generate revenues from milestones and royalties or our other drug candidates will be greatly reduced .
If we are unable to establish such collaborations, or if pharmaceutical products are not successfully and timely developed and commercialized under such collaborations, our opportunities to generate revenues from our other drug candidates will be greatly reduced.
If we are unable to establish such collaborations or arrangements, or if pharmaceutical products are not successfully and timely developed and commercialized under such collaborations or arrangements, our opportunities to generate revenues from milestones and royalties or our other drug candidates will be greatly reduced.
We may not have sufficient capital to support Phase 3 development of LX9211 in DPNP and do not have sufficient capital to support Phase 3 development of LX9211 in neuropathic pain broadly.
We may not have sufficient capital to support Phase 3 development of pilavapadin in DPNP and do not have sufficient capital to support Phase 3 development of pilavapadin in neuropathic pain broadly.
Our existing resources may be insufficient to support Phase 3 development of LX9211 in DPNP and will be insufficient to support Phase 3 development of LX9211 in neuropathic pain broadly.
Our existing resources may be insufficient to support Phase 3 development of pilavapadin in DPNP and will be insufficient to support Phase 3 development of pilavapadin in neuropathic pain broadly.
In addition, significant delays in the development of our drug candidates could allow our competitors to bring products to market before us, which would impair our or our collaborators’ ability to commercialize our drug candidates. INPEFA competes and any additional products that we or our collaborators develop will compete in highly competitive markets.
In addition, significant delays in the development of our drug candidates could allow our competitors to bring products to market before us, which would impair our or our collaborators’ ability to commercialize our drug candidates. Any products that we or our collaborators develop will compete in highly competitive markets.
If we fail to successfully complete and obtain positive results from the PROGRESS clinical trial on our expected timeline, our business will suffer and our stock price will likely decline. • Clinical testing of our drug candidates in humans is an inherently risky and time-consuming process that may fail to demonstrate safety and efficacy, which could result in the delay, limitation or prevention of regulatory approval. • Our drug candidates are subject to a lengthy and uncertain regulatory process that may not result in the necessary regulatory approvals, which could adversely affect our and our collaborators’ ability to commercialize products. • We are subject to certain healthcare laws, regulation and enforcement; our failure to comply with those laws could have a material adverse effect on our results of operations and financial condition. • Our competitors may develop products that impair the value of any products that we or our collaborators may develop.
If we fail to successfully complete and gain positive results from such research and development efforts, our business will suffer and our stock price will likely decline. • Clinical testing of our drug candidates in humans is an inherently risky and time-consuming process that may fail to demonstrate safety and efficacy, which could result in the delay, limitation or prevention of regulatory approval. • Our drug candidates are subject to a lengthy and uncertain regulatory process that may not result in the necessary regulatory approvals, which could adversely affect our and our collaborators’ ability to commercialize products. • We are subject to certain healthcare laws, regulation and enforcement; our failure to comply with those laws could have a material adverse effect on our results of operations and financial condition. • Our competitors may develop products that impair the value of any products that we or our collaborators may develop.
Due to the likelihood of fluctuations in our revenues and 26 expenses, we believe that period-to-period comparisons of our operating results are not a good indication of our future performance. We have substantial indebtedness that may limit cash flow available to invest in the ongoing needs of our business. We have incurred $99.5 million of indebtedness.
Due to the likelihood of fluctuations in our revenues and expenses, we believe that period-to-period comparisons of our operating results are not a good indication of our future performance. We have substantial indebtedness that may limit cash flow available to invest in the ongoing needs of our business.
If additional capital is not available on reasonable terms, we will be forced to obtain funds, if at all, by entering into financing agreements on unattractive terms. As of December 31, 2023, we had $170.0 million in cash, cash equivalents and investments.
If additional capital is not available on reasonable terms, we will be forced to obtain funds, if at all, by entering into financing agreements on unattractive terms. As of December 31, 2024, we had $238.0 million in cash, cash equivalents and short-term investments.
Risks Related to Our Capital Requirements and Financial Results • We will need additional capital in the future and, if it is unavailable, we will be forced to delay, reduce or eliminate our research and development programs. • We may not have sufficient capital to support Phase 3 development of LX9211.
Risks Related to Our Capital Requirements and Financial Results • We will need additional capital in the future and, if it is unavailable, we will be forced to delay, reduce or eliminate our research and development programs. • We may not have sufficient capital to support Phase 3 development of pilavapadin in DPNP and do not have sufficient capital to support Phase 3 development of pilavapadin in neuropathic pain broadly.
If we are unable to repay those amounts, the lenders could enforce the security interest granted to them to secure that debt, which would seriously harm our business. Risks Related to Our Relationships with Third Parties We depend on our ability to establish collaborations with pharmaceutical and biotechnology companies for the development and commercialization of our other drug candidates.
If we are unable to repay those amounts, the lenders could enforce the security interest granted to them to secure that debt, which would seriously harm our business. 26 Risks Related to Our Relationships with Third Parties We depend on our ability to establish collabora tions or other arrangements with phar maceutical and biotechnology companies for the development and commercialization of our drug candidates.
In some cases, patents have issued, and may issue in the future, from these applications. In addition, many companies and institutions have well-established patent portfolios directed to common techniques, methods and means of developing, producing and manufacturing pharmaceutical products.
In some cases, patents have issued, and may issue in the future, from those applications. In addition, many companies and institutions have patent portfolios directed to commonly used techniques, methods and means of developing, producing and manufacturing pharmaceutical products.
Although difficult to accurately predict, the amount of our future capital requirements will be substantial and will depend on many factors, including: • the success of our commercialization of INPEFA for the treatment of heart failure; • the success of our commercial launch of sotagliflozin for patients with type 1 diabetes and CKD, if approved; • the timing, progress and results of our research and development efforts for sotagliflozin, LX9211, LX9851 and our other drug candidates and our ability to obtain necessary regulatory approvals based on clinical trials of those drug candidates; • our success in establishing new collaborations and licenses; • the amount and timing of our research, development and commercialization expenditures; • the effect of competing programs and products, and of technological and market developments; and • the filing, maintenance, prosecution, defense and enforcement of patent claims and other intellectual property rights.
Although difficult to accurately predict, the amount of our future capital requirements will be substantial and will depend on many factors, including: • the timing, progress and results of our research and development efforts for pilavapadin, LX9851, sotagliflozin and our other drug candidates and our ability to obtain necessary regulatory approvals based on clinical trials of those drug candidates; • our success in establishing new collaborations and licenses; • the amount and timing of our research, development and commercialization expenditures; • the effect of competing programs and products, and of technological and market developments; and • the filing, maintenance, prosecution, defense and enforcement of patent claims and other intellectual property rights.
This growth will likely place significant demands on our management, operational and financial resources, and our current and planned personnel, systems, procedures and controls may not be adequate to support our growth.
If we experience it again, it will likely place significant demands on our management, operational and financial resources, and our current and planned personnel, systems, procedures and controls may not be adequate to support our growth.
If we are unable to maintain an effective sales force, marketing infrastructure and distribution capabilities, we will not be able to successfully commercialize any products that we or our collaborators may develop.
If we are unable to establish an effectiv e sales force, m arketing infrastructure and distribution capabilities, we will not be able to successfully commercialize any products that we or our collaborators may develop.
This summary does not include all of the risks we face and you should carefully review and consider the full discussion of our risk factors below, together with the other information in this annual report on Form 10-K. Risks Related to Our Business and Industry • We depend heavily on the commercial success of INPEFA in heart failure.
This summary does not include all of the risks we face and you should carefully review and consider the full discussion of our risk factors below, together with the other information in this annual report on Form 10-K.
Although the affirmative and restrictive covenants and the pledge of substantially all of our assets as collateral under the Oxford Term Loans restrict our ability to obtain additional debt financing, we could in the future incur additional indebtedness beyond such amount.
As of December 31, 2024, w e have incurred approximately $100.3 million of indebtedness. Although the affirmative and restrictive covenants and the pledge of substantially all of our assets as collateral under the Oxford Term Loans restrict our ability to obtain additional debt financing, we could in the future incur additional indebtedness beyond such amount.
Risks Related to Our Relationships with Third Parties • We depend on our ability to establish collaborations with pharmaceutical and biotechnology companies for the development and commercialization of our other drug candidates.
Risks Related to Our Relationships with Third Parties • We depend on our ability to establish collabora tions or other arrangements with phar maceutical and biotechnology companies for the development and commercialization of our drug candidates.
These effects could have a material impact on our operations. 24 Risks Related to Our Capital Requirements and Financial Results We will need additional capital in the future and, if it is unavailable, we will be forced to delay, reduce or eliminate our research and development programs.
Risks Related to Our Capital Requirements and Financial Results We will need additional capital in the future and, if it is unavailable, we will be forced to delay, reduce or eliminate our research and development programs.
The interests of Invus and its affiliates may not be aligned with the interests of other holders of our common stock. 32 Invus has additional rights under its stockholders ’ agreement relating to the membership of our board of directors and under our certificate of incorporation relating to preemptive and consent rights, which provide Invus with substantial influence over significant corporate matters.
Invus has additional rights under its stockholders ’ agreement relating to the membership of our board of directors and under our certificate of incorporation relating to preemptive and consent rights, which provide Invus with substantial influence over significant corporate matters.
In the ordinary course of our business, we collect, maintain and transmit sensitive data on our networks and systems, including our intellectual property and proprietary or confidential business information (such as research data and personal information) and confidential information with respect to our customers, clinical trial patients and our business partners.
Data breaches and cyber-attacks could compromise our intellectual property or other sensitive information and cause significant damage to our business, reputational harm and financial loss. 29 In the ordinary course of our business, we collect, maintain and transmit sensitive data on our networks and systems, including our intellectual property and proprietary or confidential business information (such as research data and personal information) and confidential information with respect to our customers, clinical trial patients and our business partners.
We are aware that other companies and institutions are developing products acting through the same drug targets through which some of our drug candidates currently in clinical development act, have conducted research on many of the same targets that we have identified and have filed patent applications potentially covering drug targets that we have identified and certain therapeutic products addressing such targets.
We are aware that other companies and institutions are developing products that act on the same drug targets upon which some of our drug candidates act, have conducted research on many of the same targets that we have identified and have filed patent applications potentially covering drugs that act on those targets.
On occasion, juries have awarded large judgments in class action lawsuits for claims based on drugs that had unanticipated side effects. In addition, the pharmaceutical and biotechnology industries, in general, have been subject to significant medical malpractice litigation. A successful product liability claim or series of claims brought against us could harm our reputation and business.
On occasion, juries have awarded large judgments in class action lawsuits for claims based on drugs that had unanticipated side effects. In addition, the pharmaceutical and biotechnology industries, in general, have been subject to significant medical malpractice litigation.
We have incurred aggregate net losses since our inception, including an aggregate net loss of $366.8 million for the three years ended December 31, 2023. As o f December 31, 2023, we had an accumulated deficit of $1.8 billion.
We have incurred aggregate net losses since our inception, including an aggregate net loss of approximately $479.5 million for the three-year period ended December 31, 2024. As o f December 31, 2024, we had an accumulated deficit of approximately $2.0 billion.
The ultimate impact of a health pandemic or epidemic is highly uncertain and subject to change.
The ultimate impact of a health pandemic or epidemic is highly uncertain and subject to change. These effects could have a material impact on our operations.
This concentration of ownership may delay or deter possible changes in control of our company, which may reduce the value of an investment in our common stock.
This concentration of ownership may delay or deter possible changes in control of our company, which may reduce the value of an investment in our common stock. The interests of Invus and its affiliates may not be aligned with the interests of other holders of our common stock.
Our currently planned operations for the next twelve months include the continued commercialization of INPEFA for the treatment of heart failure, preparations for the potential commercial launch of sotagliflozin for patients with type 1 diabetes and CKD and the continued research and development of sotagliflozin, LX9211, LX9851 and our other drug candidates.
Our currently planned operations for the next twelve months include the continued research and development of pilavapadin , LX9851, sotagliflozin and our other drug candidates and the continued limited commercialization of INPEFA for the treatment of heart failure.
Compliance with such requirements may require investment in infrastructure to ensure that tracking is performed properly, and some of these laws result in the public disclosure of various types of payments and relationships, which could potentially have a negative effect on our business and/or increase enforcement scrutiny of our activities. 22 In addition, certain marketing practices, including off-label promotion, may also violate certain federal and state health regulatory fraud and abuse laws as well as false claims laws, including the civil False Claims Act.
Compliance with such requirements may require investment in infrastructure to ensure that tracking is performed properly, and some of these laws result in the public disclosure of various types of payments and relationships, which could potentially have a negative effect on our business and/or increase enforcement scrutiny of our activities.
Risks Related to Our Intellectual Property • If we are unable to adequately protect our intellectual property, third parties may be able to use our products and technologies, which could adversely affect our ability to compete in the market. 17 Risks Related to Our Employees and Facilities • The loss of key personnel or the inability to attract and retain additional personnel could impair our ability to operate and expand our operations.
Risks Related to Our Intellectual Property • If we are unable to adequately protect our intellectual property, third parties may be able to use our products and technologies, which could adversely affect our ability to compete in the market.
Risks Related to Our Common Stock Invus, L.P. and its affiliates own a substantial interest in our outstanding common stock and may have interests which conflict with those of our other stockholders.
A successful product liability claim or series of claims brought against us could harm our reputation and business. 31 Risks Related to Our Common Stock Invus, L.P. and its affiliates own a substantial interest in our outstanding common stock and may have interests which conflict with those of our other stockholders.
Should we fail to obtain positive results from the PROGRESS clinical trial, or if the PROGRESS clinical trial is not completed on our expected timeline due to delays in planned patient enrollment or otherwise, our opportunity to establish a strategic collaboration or other arrangement for the further development and commercialization of LX9211 would be negatively affected, our business and financial condition could be materially harmed and we may be more heavily dependent on the success of our other drug programs.
Should we fail to obtain positive results from any ongoing research and development efforts, or if any such efforts are not completed on our expected timelines, the likelihood of gaining regulatory approval for the impacted drug program would be reduced, our opportunity to establish a strategic collaboration or other arrangement for the further research, development and commercialization of the impacted drug program would be negatively affected, our business and financial condition could be materially harmed and we may be more heavily dependent on the success of our other drug programs.
Thus, the FDA and other regulatory authorities may not approve any drug candidates that we develop for any indication or may limit the approved indications or impose other conditions. 19 Our drug candidates are subject to a lengthy and uncertain regulatory process that may not result in the necessary regulatory approvals, which could adversely affect our and our collaborators’ ability to commercialize products.
Our drug candidates are subject to a lengthy and uncertain regulatory process that may not result in the necessary regulatory approvals, which could adversely affect our and our collaborators’ ability to commercialize products.
Retaining and, where advisable, recruiting qualified commercial, medical and clinical personnel will be critical to the commercialization of INPEFA for heart failure, the potential commercial launch of sotagliflozin for patients with type 1 diabetes and CKD and the advancement of our research and development efforts for sotagliflozin, LX9211, LX9851 and our other drug candidates.
Retaining and, where advisable, recruiting qualified personnel will be critical to the advancement of our research and development efforts for pilavapadin, LX9851, sotagliflozin and our other drug candidates.
Any such disruptions could negatively impact productivity and delay our ongoing commercialization of INPEFA and research and development efforts with respect to our drug candidates.
The emergence of any new, more virulent SARS-CoV-2 variants could negatively affect the health and availability of our workforce and cause new disruptions to our business operations. Any such disruptions could negatively impact productivity and delay our ongoing commercialization of INPEFA and research and development efforts with respect to our drug candidates.
Our operating results have fluctuated and likely will continue to fluctuate, and we believe that period-to-period comparisons of our operating results are not a good indication of our future performance. Our operating results have fluctuated in the past and are likely to fluctuate in the future.
Even if we do achieve profitability in future periods, we may not be able to sustain or increase such profitability on a quarterly or annual basis. Our operating results have fluctuated and likely will continue to fluctuate, and we believe that period-to-period comparisons of our operating results are not a good indication of our future performance.
If we become involved in future intellectual property litigation, it could consume a substantial portion of our resources and could negatively affect our results of operations. Data breaches and cyber-attacks could compromise our intellectual property or other sensitive information and cause significant damage to our business, reputational harm and financial loss.
If we become involved in future intellectual property litigation, it could consume a substantial portion of our resources and could negatively affect our results of operations.
Risks Related to Environmental and Product Liability • Our business has a substantial risk of product liability and we face potential product liability exposure far in excess of our limited insurance coverage.
Risks Related to Our Employees and F acilities • The loss of key personnel or the inability to attract and retain additional personnel could impair our ability to operate and expand our operations. 17 Risks Related to Environmental and Product Liability • Our business has a substantial risk of product liability and we face potential product liability exposure far in excess of our limited insurance coverage.
Moreover, noncompliance with the FDA’s cGMP regulations can result in, among other things, fines, injunctions, civil and criminal penalties, product recalls or seizures, suspension of production, failure to obtain marketing approval and withdrawal, suspension or revocation of marketing approvals. 28 Risks Related to Our Intellectual Property If we are unable to adequately protect our intellectual property, third parties may be able to use our products and technologies, which could adversely affect our ability to compete in the market.
Moreover, noncompliance with the FDA’s cGMP regulations can result in, among other things, fines, injunctions, civil and criminal penalties, product recalls or seizures, suspension of production, failure to obtain marketing approval and withdrawal, suspension or revocation of marketing approvals.
As a result, our competitors may be able to more easily develop and commercialize products that would render INPEFA and any other products that we or our collaborators develop obsolete and noncompetitive.
As a result, our competitors may be able to more easily develop and commercialize products that would render any products that we or our collaborators develop obsolete and noncompetitive. In addition, there may also be drug candidates of which we are not aware at an earlier stage of development that may compete with our drugs and drug candidates.
We cannot offer any assurances or predict with any certainty that the PROGRESS clinical trial will be successfully completed, generate positive clinical data or demonstrate a competitive commercial profile for LX9211, in any such case on our expected timeline.
We cannot offer any assurances or predict with any certainty that our ongoing research and development efforts, including our IND-enabling studies for LX9851 and SONATA-HCM Phase 3 clinical trial of sotagliflozin in HCM, will be successfully completed, generate positive data or demonstrate competitive clinical or commercial profiles, in any case on our expected timelines.
Future revenues from our existing and future collaborations depend upon the achievement of milestones and payment of royalties we earn from any future products developed under those arrangements.
For example, we have entered into an exclusive license agreement with Viatris for the development and commercialization of sotagliflozin in all markets outside of the United States and Europe. Future revenues from our existing and future collaborations depend upon the achievement of milestones and payment of royalties we earn from any future products developed under those arrangements.
In addition, there may also be drug candidates of which we are not aware at an earlier stage of development that may compete with our drugs and drug candidates. The outbreak of the novel coronavirus, or COVID-19, had an adverse impact on our business operations and clinical trials and another novel coronavirus could adversely affect our business in the future.
The outbreak of the novel coronavirus, or COVID-19, had an adverse impact on our business operations and clinical trials and another novel coronavirus could adversely affect our business in the future. Our business was disrupted and adversely affected by the COVID-19 pandemic.
The size of our net losses will depend, in part, on the rate of decline or growth in our revenues and on the amount of our expenses.
The size of our net losses will depend, in part, on the rate of decline or growth in our revenues and on the amount of our expenses. We expect to continue to incur significant expenses over the next several years including the continued research and development of pilavapadin, LX9851, sotagliflozin and our other drug candidates.
We have spent and expect to continue spending significant amounts to fund our commercialization of INPEFA for the treatment of heart failure, preparations for our potential commercial launch of sotagliflozin for patients with type 1 diabetes and CKD and our continued research and development of sotagliflozin, LX9211, LX9851 and our other drug candidates.
We have spent and expect to continue spending significant amounts to fund our continued research and development of pilavapadin, LX9851, sotagliflozin and our other drug candidates. As a result, we will need to generate substantial additional revenues to achieve profitability in future periods.
We depend heavily on our ability to successfully complete and obtain positive results from our ongoing PROGRESS Phase 2b clinical trial of LX9211 in DPNP.
Risks Related to Our Business and Industry • We depend heavily on our ability to successfully complete the ongoing research and development of our drug programs.
Removed
If we do not achieve commercial success with INPEFA, our business will suffer and our stock price will likely decline. • We depend heavily on our ability to obtain regulatory approval in the United States for sotagliflozin in patients with type 1 diabetes and CKD.
Added
We are developing pilavapadin for neuropathic pain, LX9851 for obesity and cardiometabolic disorders and sotagliflozin for HCM and conducting research and development of compounds from a number of additional drug programs.
Removed
Risks Related to Our Business and Industry We depend heavily on the commercial success of INPEFA in heart failure. If we do not achieve commercial success with INPEFA, our business will suffer and our stock price will likely decline.
Added
Thus, the FDA and other regulatory authorities may not approve any drug candidates that we develop for any indication or may limit the approved indications or impose other conditions.
Removed
We expect that a significant portion of our total revenues for the next several years will be attributable to sales of INPEFA for heart failure in the United States, but we cannot be certain that INPEFA will be commercially successful.
Added
We no longer maintain a significant commercial infrastructure following our restructuring and reduction of commercial operations for INPEFA and would need to reestablish sales capabilities in order to effectively commercialize any future products.
Removed
Our future sales of INPEFA will depend on numerous factors, including: • the number of patients suffering from heart failure; • competition from dapagliflozin, empagliflozin and, to some extent, other classes of drugs used in the treatment of heart failure, such as the combination drug sacubitril/valsartan; • the effectiveness of our commercial strategy for marketing INPEFA and our execution of that strategy, in particular the effectiveness of our efforts to obtain and maintain adequate third-party reimbursement; • the safety profile of INPEFA, including whether previously unknown side effects or increased incidence or severity of known side effects as compared to those seen during development are identified with the commercial use of INPEFA; • the acceptance of INPEFA by patients, the medical community and third-party payers; and • our ability to meet the demand for commercial supplies of INPEFA and to maintain and successfully monitor commercial manufacturing arrangements for INPEFA with third-party manufacturers to ensure they meet our standards and those of the FDA, which extensively regulates and monitors pharmaceutical manufacturing facilities.
Added
In addition, certain marketing practices, including off-label promotion, may also violate certain federal and state health regulatory fraud and abuse laws as well as false claims laws, including the civil False Claims Act.
Removed
While we believe that INPEFA has a competitive commercial profile, our current estimates of the revenues that INPEFA could generate in future periods may change based upon the above factors, and could prove to be incorrect.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur executive management and board of directors also receive prompt and timely information regarding any cybersecurity incident that meets established reporting thresholds, as well as ongoing updates regarding any such incident until it has been addressed. 35 Our vice president, information operations works collaboratively across our company to implement a program designed to protect our information systems from cybersecurity threats and to promptly respond to any cybersecurity threats in accordance with our incident response and recovery plans.
Biggest changeOur executive management and board of directors also receive prompt and timely information regarding any cybersecurity incident that meets established reporting thresholds, as well as ongoing updates regarding any such incident until it has been addressed.
We have established and maintain comprehensive incident response and recovery plans that fully address our response to a cybersecurity incident, and such plans are tested and evaluated on a regular basis. • Collaborative Approach .
We have established and maintain comprehensive incident response and recovery plans that fully address our response to a cybersecurity incident, and such plans are tested and evaluated on a regular basis. 34 • Collaborative Approach .
Added
Our vice president, information operations works collaboratively across our company to implement a program designed to protect our information systems from cybersecurity threats and to promptly respond to any cybersecurity threats in accordance with our incident response and recovery plans.

Item 2. Properties

Properties — owned and leased real estate

1 edited+1 added−0 removed2 unchanged
Biggest changeItem 2. Properties In February 2021, we leased a 25,000 square-foot office space in The Woodlands, Texas. The term of the sublease extends from March 2021 through August 2025, and provides for escalating yearly base rent payments starting at $506,000 and increasing to $557,000 in the final year of the lease.
Biggest changeItem 2. Properties In February 2021, we leased a 25,000 square-foot office space in The Woodlands, Texas. The term of the sublease extends from March 2021 through August 2025, and provides for escalating yearly base rent payments which are $557,000 for 2025, the final year of the lease.
Added
In July 2024, we entered into a new lease agreement for our existing office space in The Woodlands, Texas. The term of the lease begins September 2025, extends through January 2031 and provides for escalating yearly base rent payments starting at $774,000 and increasing to $875,000 in the final year of the lease.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−0 removed1 unchanged
Biggest changeWe are currently not aware of any material legal proceedings affecting our company.
Biggest changeWe are currently not aware of any material legal proceedings affecting our company. 35 Table of Contents

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeDecember 31, 2018 2019 2020 2021 2022 2023 Lexicon Pharmaceuticals, Inc. 100 63 52 59 29 23 Nasdaq Composite Index 100 135 194 236 158 226 Nasdaq Biotechnology Index 100 124 156 155 138 144 The foregoing stock price performance comparisons shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference by any general statement incorporating by reference this annual report on Form 10-K into any filing under the Securities Act of 1933 or under the Securities Exchange Act of 1934, except to the extent that we specifically incorporate such comparisons by reference.
Biggest changeDecember 31, 2019 2020 2021 2022 2023 2024 Lexicon Pharmaceuticals, Inc. 100 82 95 46 37 18 Nasdaq Composite Index 100 144 174 117 167 215 Nasdaq Biotechnology Index 100 126 125 111 115 114 The foregoing stock price performance comparisons shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference by any general statement incorporating by reference this annual report on Form 10-K into any filing under the Securities Act of 1933 or under the Securities Exchange Act of 1934, except to the extent that we specifically incorporate such comparisons by reference.
The graph assumes that the value of the investment in our common stock and each index was $100 at December 31, 2018, and that all dividends were reinvested. The stock performance shown on the graph below represents historical performance and is not necessarily indicative of future stock price performance.
The graph assumes that the value of the investment in our common stock and each index was $100 at December 31, 2019, and that all dividends were reinvested. The stock performance shown on the graph below represents historical performance and is not necessarily indicative of future stock price performance.
Performance Graph The following performance graph compares the performance of our common stock to the Nasdaq Composite Index and the Nasdaq Biotechnology Index for the period beginning December 31, 2018 and ending December 31, 2023.
Performance Graph The following performance graph compares the performance of our common stock to the Nasdaq Composite Index and the Nasdaq Biotechnology Index for the period beginning December 31, 2019 and ending December 31, 2024.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is quoted on The Nasdaq Global Select Market under the symbol “LXRX.” As of March 21, 2024, there were approximately 313 holders of record of our common stock. We have never paid cash dividends on our common stock.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is quoted on The Nasdaq Global Select Market under the symbol “LXRX.” As of February 28, 2025, there were approximately 273 holders of record of our common stock. We have never paid cash dividends on our common stock.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

47 edited+14 added−9 removed27 unchanged
Biggest changeSalaries, bonuses, employee benefits, payroll taxes, recruiting and relocation costs are included in personnel costs. • Professional and consulting fees – Professional and consulting fees increased 137% in 2023 to $38.7 million, primarily due to higher marketing and professional fees in conjunction with the commercial launch of INPEFA. • Stock-based compensation – Stock-based compensation expense increased 27% in 2023 to $9.2 million as compared to 2022, due to increasing headcount in the current year. • Facilities, equipment, and other – Facilities, equipment, and other costs were $13.1 million and $5.6 million in 2023 and 2022, respectively.
Biggest changeThe increase is driven by higher employee salaries and benefit costs, including severance of $11.2 million incurred in late 2024 related to the significant reduction in our commercial field force. • Professional and consulting fees – Professional and consulting fees increased 36% in 2024 to $52.7 million, primarily due to higher marketing expenses in 2024 and professional fees incurred for ZYNQUISTA prior to receipt of the complete response letter in December 2024 by the FDA. • Stock-based compensation – Stock-based compensation expense decreased 17% in 2024 to $7.7 million as compared to 2023 reflecting forfeitures of unvested awards due to decreased headcount, primarily reflecting the reduction in the field force in late 2024. • Facilities, equipment, and other – Facilities, equipment, and other costs were $14.6 million and $13.1 million in 2024 and 2023, respectively.
Recent Accounting Pronouncements Issued But Not Yet Adopted See Note 2, Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements, for a discussion of the impact of new accounting standards issued but not yet adopted on our consolidated financial statements. 40 Results of Operations The following discussion and analysis should be read with “Results of Operations” and our financial statements and notes included in our annual report on Form 10-K for the year ended December 31, 2022.
Recent Accounting Pronouncements Issued But Not Yet Adopted See Note 2, Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements, for a discussion of the impact of new accounting standards issued but not yet adopted on our consolidated financial statements. 40 Results of Operations The following discussion and analysis should be read with “Results of Operations” and our financial statements and notes included in our annual report on Form 10-K for the year ended December 31, 2023.
The sale of additional equity or convertible debt securities may result in additional dilution to our stockholders. 43 From time to time, our board of directors may authorize us to repurchase shares of our common stock.
The sale of additional equity or convertible debt securities may result in additional dilution to our stockholders. From time to time, our board of directors may authorize us to repurchase shares of our common stock.
We are subject to interest rate sensitivity on our outstanding Oxford Term Loans which bear interest at a floating rate equal to the 1-month CME Term SOFR rate. Interest on the Oxford Term Loans is payable in cash monthly and the term loans are fully matured by March 2027, unless earlier repaid in accordance with their terms.
We are subject to interest rate sensitivity on our outstanding Oxford Term Loans which bear interest at a floating rate equal to the 1-month CME Term SOFR rate. Interest on the Oxford Term Loans is payable in cash monthly and the term loans are fully matured by March 2029, unless earlier repaid in accordance with their terms.
Other commitments. Upon the regulatory approval of sotagliflozin for the treatment of type 1 diabetes in a major market, we will be required to make certain royalty payments, totaling $4.5 million, in three equal annual installments of $1.5 million.
Upon the regulatory approval of sotagliflozin for the treatment of type 1 diabetes in a major market, we will be required to make certain royalty payments, totaling $4.5 million, in three equal annual installments of $1.5 million.
Research and development expenses consist primarily of salaries and related personnel costs, external research costs related to our preclinical and clinical efforts, material costs, facility costs, depreciation on property and equipment, and other expenses related to our drug discovery and development programs.
Research and development expenses consist primarily of salaries and related personnel costs, external research costs related to our nonclinical and clinical efforts, material costs, facility costs, depreciation on property and equipment, and other expenses related to our drug discovery and development programs.
We may determine, as we have with INPEFA in heart failure, that our interests are better served by retaining rights to our discoveries and advancing our therapeutic programs to a later stage, which could limit our near-term revenues and increase expenses.
We may determine, as we have with INPEFA in heart failure in the United States, that our interests are better served by retaining rights to our discoveries and advancing our therapeutic programs to a later stage, which could limit our near-term revenues and increase expenses.
We believe that our current unrestricted cash and investment balances and cash and revenues we expect to derive from strategic and other collaborations and other sources will be sufficient to fund our currently planned operations for at least the next 12 months from the date of this report.
We believe that our current unres tricted cash and investment balances and cash and revenues we expect to derive from strategic and other collaborations and other sources will be sufficient to fund our currently planned operations for at least the next 12 months from the date of this report.
Disclosure about Market Risk We are exposed to limited market and credit risk on our cash equivalents which have maturities of three months or less at the time of purchase. We had approximately $170.0 million in cash and cash equivalents and short-term investments as of December 31, 2023. We maintain a short-term investment portfolio which consists of U.S.
Disclosure about Market Risk We are exposed to limited market and credit risk on our cash equivalents which have maturities of three months or less at the time of purchase. We had approximately $238.0 million in cash and cash equivalents and short-term investments as of December 31, 2024. We maintain a short-term investment portfolio which consists of U.S.
Under our drug discovery alliance with Bristol-Myers Squibb, we will be required to make a royalty payment of $5 million upon dosing of the first patient in a Phase 3 clinical trial of LX9211 . For a further discussion of our commitments and contingencies see Note 10 of the Notes to Consolidated Financial Statements.
Under our drug discovery alliance with Bristol-Myers Squibb, we will be required to make a milestone payment of $5 million upon dosing of the first patient in a Phase 3 clinical trial of pilavapadin. For a further discussion of our commitments and contingencies see Note 10 of the Notes to Consolidated Financial Statements.
Our operating results and, in particular, our ability to generate additional revenues are dependent on many factors, including the success of our commercialization of INPEFA in the United States and the amount of revenues generated from 38 sales of INPEFA; the success of our ongoing research and development efforts and the ability to obtain necessary regulatory approvals of the drug candidates which are the subject of such efforts; our success in establishing new collaborations and licenses and our receipt of milestones, royalties and other payments under such arrangements; and general and industry-specific economic conditions which may affect research, development and commercialization expenditures.
Our operating results and, in particular, our ability to generate additional revenues are dependent on many factors, including the success of our ongoing research and development efforts and the ability to obtain necessary regulatory approvals of the drug candidates which are the subject of such efforts; our success in establishing new collaborations and licenses and our receipt of milestones, royalties and other payments under such arrangements; and general and industry-specific economic conditions which may affect research, development and commercialization expenditures.
Selling, General and Administrative Expenses Selling, general and administrative expenses and dollar and percentage changes as compared to the prior year are as follows (dollar amounts are presented in millions): Year Ended December 31, 2023 2022 2021 Total selling, general and administrative expense $ 114.0 $ 48.1 $ 32.3 Dollar increase $ 65.9 $ 15.8 Percentage increase 137 % 49 % Selling, general and administrative expenses consist primarily of personnel costs to support the commercialization of INPEFA and support of our research and development activities, professional and consulting fees, stock-based compensation expense, and facilities, equipment, and other costs each of which are described further below.
Selling, General and Administrative Expenses Selling, general and administrative expenses and dollar and percentage changes as compared to the prior year are as follows (dollar amounts are presented in millions): Year Ended December 31, 2024 2023 2022 Total selling, general and administrative expense $ 143.1 $ 114.0 $ 48.1 Dollar increase $ 29.1 $ 65.9 Percentage increase 26 % 137 % Selling, general and administrative expenses consist primarily of personnel costs to support the commercialization of INPEFA and support of our research and development activities, professional and consulting fees, stock-based compensation expense, and facilities, equipment, and other costs each of which are described further below.
INPEFA, LX9851 and compounds from a number of additional drug programs originated from our own internal drug discovery efforts, and LX9211 originated from our collaborative neuroscience drug discovery efforts with Bristol-Myers Squibb.
Pilavapadin originated from our collaborative neuroscience drug discovery efforts with Bristol-Myers Squibb and LX9851, sotagliflozin and compounds from a number of additional drug programs originated from our own internal drug discovery efforts.
INPEFA, LX9851 and compounds from a number of additional drug programs originated from our own internal drug discovery efforts, and LX9211 originated from our collaborative neuroscience drug discovery efforts with Bristol-Myers Squibb.
Pilavapadin originated from our collaborative neuroscience drug discovery efforts with Bristol-Myers Squibb and LX9851, sotagliflozin and compounds from a number of additional drug programs originated from our own internal drug discovery efforts.
Research and Development Expenses Research and development expenses and dollar and percentage changes as compared to the prior year are as follows (dollar amounts are presented in millions): Year Ended December 31, 2023 2022 2021 Total research and development expense $ 58.9 $ 52.8 $ 55.0 Dollar increase (decrease) $ 6.1 $ (2.2) Percentage increase (decrease) 12 % (4) % Research and development expenses consist primarily of third-party services principally related to preclinical and clinical development activities, salaries and other personnel-related expenses, facility and equipment costs, stock-based compensation, and other costs each of which are described below.
Research and Development Expenses Research and development expenses and dollar and percentage changes as compared to the prior year are as follows (dollar amounts are presented in millions): Year Ended December 31, 2024 2023 2022 Total research and development expense $ 84.5 $ 58.9 $ 52.8 Dollar increase $ 25.6 $ 6.1 Percentage increase 43 % 12 % Research and development expenses consist primarily of third-party services principally related to preclinical and clinical development activities, salaries and other personnel-related expenses, facility and equipment costs, stock-based compensation expense and other costs each of which are described below.
Salaries, bonuses, employee benefits, payroll taxes, recruiting and relocation costs are included in personnel costs. • Stock-based compensation – Stock-based compensation expense increased 21% in 2023 to $5.1 million as compared to 2022, partially due to increased headcount. 41 • Facilities, equipment, and other – Facilities, equipment, and other costs relate primarily to rent, insurance, travel and training, and software licensing costs.
Salaries (including severance), bonuses, employee benefits, payroll taxes, recruiting and relocation costs are included in personnel costs. • Stock-based compensation – Stock-based compensation expense increased 14% in 2024 to $5.8 million as compared to 2023. 41 • Facilities, equipment, and other – Facilities, equipment, and other costs relate primarily to rent, insurance, travel and training, and software licensing costs.
Facilities, equipment, and other costs were $4.9 million and $5.2 million in 2023 and 2022, respectively.
Facilities, equipment, and other costs were $5.3 million and $4.9 million in 2024 and 2023, respectively.
Our future capital requirements will be substantial and will depend on many factors, including the success of our commercialization of INPEFA in the United States; the success of our commercial launch of sotagliflozin for patients with type 1 diabetes and CKD, if approved; the success of our ongoing research and development efforts and the ability to obtain necessary regulatory approvals of the drug candidates which are the subject of such efforts; our success in establishing new collaborations and licenses and our receipt of milestones, royalties and other payments under such arrangements; the amount and timing of our research, development and commercialization expenditures; the resources we devote to commercializing, developing and supporting our products and other factors.
Our future capital requirements will be substantial and will depend on many factor s, including the success of our ongoing research and development efforts and the ability to obtain necessary regulatory approvals of the drug candidates which are the subject of such efforts; our success in establishing new collaborations and licenses and our receipt of milestones, royalties and other payments under such arrangements; the amount and timing of our research, development and commercialization expenditures; the resources we devote to commercializing, developing and supporting our products and other factors.
We seek to collaborate with other pharmaceutical and biotechnology companies with respect to the research, development and commercialization of certain of our drug candidates, particularly with respect to commercialization in territories outside the United States or commercialization in the United States for indications treated by primary care physicians, or when the collaboration may otherwise provide us with access to expertise and resources that we do not possess internally or are complementary to our own.
We seek to collaborate with other pharmaceutical and biotechnology companies with respect to the research, development and commercialization of certain of our drug candidates, particularly with respect to commercialization in territories outside the United States or commercialization in the United States for indications treated by primary care physicians, or when the collaboration may otherwise provide us with access to expertise and resources that we do not possess internally or are complementary to our own. 38 We have derived substantially all of our revenues from strategic collaborations and other research and development collaborations and technology licenses, as well as from commercial sales of our approved drug products.
The fifth $25 million tranche is available for draw at our option, subject to Oxford’s consent, at any time prior to the expiration of the 36-month interest-only payment period.
The fifth $25 million tranche is available for draw at our option, subject to Oxford’s consent, at any time prior to the expiration of the 60-month interest-only payment period with an amortization date of May 1, 2027.
Since our inception, we have incurred significant losses and, as of December 31, 2023, we had an accumulated deficit of $1.8 billion.
Since our inception, we have incurred significant losses and, as of December 31, 2024, we had an accumulated deficit of approximately $2.0 billion.
For additional information on the private placement offering, please refer to Note 13 of the Notes to Consolidated Financial Statements. As of December 31, 2023, we had $170.0 million in cash, cash equivalents and short-term investments. As of December 31, 2022, we had $138.4 million in cash, cash equivalents and short-term investments.
For additional information on the exclusive license agreement, please refer to Note 7 of the Notes to Consolidated Financial Statements. As of December 31, 2024, we had $238.0 million in cash, cash equivalents and short-term investments. As of December 31, 2023, we had $170.0 million in cash, cash equivalents and short-term investments.
Based on our expectations for future manufacturing costs, we estimate these amounts totaled approximately $39.0 million. We began capitalizing inventory manufactured subsequent to regulatory approval of INPEFA as the related costs were expected to be recoverable through the commercialization of the product. At December 31, 2023, substantially all of the “zero-cost” INPEFA raw materials remains available to us.
We began capitalizing inventory manufactured subsequent to regulatory approval of INPEFA as the related costs were expected to be recoverable through the commercialization of the product. At December 31, 2024, substantially all of the “zero-cost” INPEFA raw materials remains available to us.
Years Ended December 31, 2023 and 2022 • Third-party services – Third-party services relate principally to our clinical trial and related development activities, such as preclinical and clinical studies and contract manufacturing. Overall, third-party services increased 16% in 2023 to $34.6 million, primarily related to increased manufacturing and external research and development costs.
Years Ended December 31, 2024 and 2023 • Third-party services – Third-party services relate principally to our clinical trial and related development activities, such as preclinical and clinical studies and contract manufacturing.
These costs include direct and research-related overhead expenses and are expensed as incurred. Technology license fees for technologies that are utilized in research and development and have no alternative future use are expensed when incurred.
These costs include direct and research-related overhead expenses and are expensed as incurred. Technology license fees for technologies that are utilized in research and development and have no alternative future use are expensed when incurred. We are presently devoting most of our resources to the continued research and development of pilavapadin, LX9851, sotagliflozin and our other drug candidates.
During or after this period, if cash generated by operations is insufficient to satisfy our liquidity requirements, we will need to sell additional equity or debt securities or obtain additional credit arrangements.
In future periods, if cash on hand or generated by operations is insufficient to satisfy our liquidity requirements, we will need to obtain additional liquidity through future strategic and other collaborations or sell additional equity or debt securities or obtain additional credit arrangements.
Selling, general and administrative expenses consist primarily of salaries and related expenses for executive, sales and marketing, and administrative personnel, professional fees and other corporate expenses, including information technology, facilities costs and general legal activities.
Selling, general and administrative expenses consist primarily of salaries and related expenses for executive, sales and marketing, and administrative personnel, professional fees and other corporate expenses, including information technology, facilities costs and general legal activities. We expect to continue to incur significant research and development costs in connection with the continuing research and development of our drug candidates.
On March 11, 2024, we entered into an agreement with certain accredited investors in a private placement in which we agreed to sell 2,304,147 shares of Series A Convertible Preferred Stock of the Company, par value $0.01 per share, at a price of $108.50 per share.
As of December 31, 2024, the full amount is still available for issuance under the agreement. On March 11, 2024, we entered into an agreement with certain accredited investors pursuant to which we agreed to sell 2,304,147 shares of our Series A Convertible Preferred Stock, at a price of $108.50 per share.
We estimate our cost of goods sold as a percentage of net product revenue will be less than 10% subsequent to the utilization of all of the remaining “zero-cost” inventory.
Any future sales of INPEFA will utilize this “zero-cost” inventory and will result in a lower average per unit cost of materials during that period. We estimate our cost of goods sold as a percentage of net product revenue will be less than 10% subsequent to the utilization of all of the remaining “zero-cost” inventory.
Critical Accounting Policies Our Consolidated Financial Statements included in this Annual Report on Form 10-K have been prepared in accordance with accounting principles generally accepted in the United States, or GAAP, which require that we make numerous estimates and assumptions. Actual results could differ from those estimates and assumptions, thus impacting our reported results of operations and financial position.
As a result, we will need to generate significantly higher revenues to achieve profitability. Critical Accounting Policies Our Consolidated Financial Statements included in this Annual Report on Form 10-K have been prepared in accordance with accounting principles generally accepted in the United States, or GAAP, which require that we make numerous estimates and assumptions.
The loan and security agreement was subsequently amended in August 2022, May 2023, June 2023, December 2023 and March 2024. The fourth $25 million tranche is available for draw at our option upon the achievement of specified INPEFA net sales and until April 25, 2025.
The fourth $25 million tranche is available for draw at our option upon the achievement of specified INPEFA net sales and until April 25, 2025.
Liquidity and Capital Resources We have financed our operations from inception primarily through sales of common and preferred stock, contract and milestone payments we received under our collaborations and strategic licenses, target validation, database subscription and technology license agreements, government grants and contracts, and financing under debt, lease and other project financing arrangements, as well as from commercial sales of our approved drug products. 42 In March 2022, we entered into a loan and security agreement with Oxford Finance LLC that provides up to $150 million in borrowing capacity, available in five tranches, under which $100 million has been funded under the first three tranches.
Liquidity and Capital Resources We have financed our operations from inception primarily through sales of common and preferred stock, contract and milestone payments we received under our collaborations and strategic licenses, target validation, database subscription and 42 technology license agreements, government grants and contracts, and financing under debt, lease and other project financing arrangements, as well as from commercial sales of our approved drug products.
Our capital requirements will also be affected by any expenditures we make in connection with license agreements and acquisitions of and investments in complementary technologies and businesses.
Our capital requirements will also be affected by any expenditures we make in connection with license agreements and acquisitions of and investments in complementary technologies and businesses. 43 We expect to continue to devote substantial capital resources to the research and development of our drug candidates and for other general corporate activities.
The “zero-cost” inventory is expected to be consumed over approximately the next three years, which will result in a lower average per unit cost of materials during that period; however, the time period over which this inventory is consumed will depend on a number of factors, including the amount of future INPEFA sales, use of this inventory in clinical development or other research activities, production lead times, and/or the ability to utilize inventory prior to its expiration date.
However, the time period over which this inventory is consumed will depend on a number of factors that may include the amount of future INPEFA sales, use of this inventory to satisfy the manufacturing and supply agreement we have agreed to enter into with Viatris (see Note 7) or in clinical development or other research activities, production lead times, and/or the ability to utilize inventory prior to its expiration date.
We are conducting a Phase 2b clinical trial of LX9211 in diabetic peripheral neuropathic pain, or DPNP, and have received Fast Track designation from the FDA for development of LX9211 in that indication.
We have reported top-line results from our Phase 2b clinical trial of pilavapadin in diabetic peripheral neuropathic pain, or DPNP, which demonstrated clear evidence of effect at the 10 mg dose and have received Fast Track designation from the U.S. Food and Drug Administration, or FDA, for development of pilavapadin in that indication.
Interest income and other, net was $7.7 million and $1.6 million in the years ended December 31, 2023 and 2022, respectively. Net Loss and Net Loss per Common Share Net loss was $177.1 million, or a loss of $0.80 per share, in 2023, as compared to a net loss of $101.9 million, or $0.62 per share in 2022.
Net Loss and Net Loss per Common Share Net loss was $200.4 million, or $0.63 net loss per share, in 2024, as compared to a net loss of $177.1 million, or $0.80 net loss per share, in 2023.
Prior to receiving regulatory approval on May 26, 2023, we had completed or begun the manufacturing of certain INPEFA raw materials. These raw materials were either received at “zero-cost” to us in conjunction with a terminated agreement in 2019 or recorded as research and development expense.
These raw materials were either received at “zero-cost” to us in conjunction with a terminated agreement in 2019 or recorded as research and development expense. Based on our expectations for future manufacturing costs, we estimate these amounts totaled approximately $39.0 million.
We are separately pursuing regulatory approval of sotagliflozin as a treatment for type 1 diabetes. The U.S. Food and Drug Administration, or FDA, issued a complete response letter regarding our New Drug Application, or NDA, for sotagliflozin in type 1 diabetes in March 2019, which we appealed.
The FDA issued a complete response letter regarding our New Drug Application, or NDA, for sotagliflozin in type 1 diabetes in March 2019 and an additional complete response letter in December 2024 regarding our NDA for sotagliflozin as an adjunct to insulin therapy for glycemic control in adults with type 1 diabetes and CKD.
We used cash of $161.9 million in our operations in 2023 largely reflective of the net loss for the year of $177.1 million which included non-cash charges of $12.6 million primarily related to stock-based compensation expense. Investing activities used cash of $49.9 million in 2023, primarily due to net purchases of investments.
We used cash of $178.8 million in our operations in 2024 largely reflective of the net loss for the year of $200.4 million (including non-cash charges of $7.4 million) and changes in working capital. Investing activities used cash of $15.4 million in 2024, primarily due to net purchases of investments.
We are devoting most of our resources to the commercialization of our approved drug, INPEFA, for heart failure and the research and development of our most advanced drug candidates: • We are commercializing INPEFA, an orally-delivered small molecule drug, in the United States to reduce the risk of cardiovascular death, hospitalization for heart failure, and urgent heart failure visits in adults with heart failure or type 2 diabetes mellitus, chronic kidney disease, or CKD, and other cardiovascular risk factors.
We have also reported positive results from a Phase 2a clinical trial of pilavapadin in DPNP and results from a separate Phase 2a clinical trial of pilavapadin in post-herpetic neuralgia which also demonstrated evidence of effect. • We are developing LX9851, an orally-delivered small molecule drug candidate, as a treatment for obesity and associated cardiometabolic disorders and are conducting preclinical development of LX9851 in preparation for filing an investigational new drug application, or IND. • We are commercializing INPEFA (sotagliflozin), an orally-delivered small molecule drug, in the United States to reduce the risk of cardiovascular death, hospitalization for heart failure, and urgent heart failure visits in adults with heart failure or type 2 diabetes mellitus, chronic kidney disease, or CKD, and other cardiovascular risk factors.
We are also developing sotagliflozin as a treatment for hypertrophic cardiomyopathy, or HCM, and are preparing to initiate a Phase 3 clinical trial of sotagliflozin in HCM. • We are developing LX9211, an orally-delivered small molecule drug candidate, as a treatment for neuropathic pain.
We are also developing sotagliflozin as a treatment for hypertrophic cardiomyopathy, or HCM, and are conducting a Phase 3 clinical trial of sotagliflozin in that indication. We are separately pursuing regulatory approval of ZYNQUISTA™ (sotagliflozin) as a treatment for type 1 diabetes.
We have derived substantially all of our revenues from strategic collaborations and other research and development collaborations and technology licenses, as well as from commercial sales of our approved drug products. To date, we have generated a substantial portion of our revenues from a limited number of sources.
To date, we have generated a substantial portion of our revenues from a limited number of sources.
Interest and other expense increased to $13.1 million in 2023 from $2.8 million in 2022, primarily due to the Oxford debt financings of $25 million in December 2022 and $50 million in June 2023. Interest Income and Other, Net Interest Income and Other, Net.
The increase was primarily due to travel in conjunction with the commercialization of INPEFA. Interest and Other Expense Interest and Other Expense . Interest and other expense increased to $15.6 million in 2024 from $13.1 million in 2023, reflecting the additional $50 million borrowed under the Oxford Term Loans in June 2023.
We received net proceeds of approximately $242 million, after deducting placement agent fees and offering expenses from the private placement offering.
We received net proceeds of approximately $241.3 million, after deducting placement agent fees and offering expenses from the private placement offering. On May 10, 2024, each share of preferred stock was converted into 50 shares of our common stock, or an aggregate of 115,207,350 shares.
Revenues Revenues for the year ended December 31, 2023 were approximately $1.2 million, primarily from product revenues recognized from sales of INPEFA following its regulatory approval in May 2023. Cost of Sales Cost of sales during the year ended December 31, 2023 consist of third-party manufacturing costs and freight associated with sales of INPEFA.
Cost of Sales Cost of sales for the years ended December 31, 2024 and 2023 consist of third-party manufacturing costs and freight associated with sales of INPEFA. Prior to receiving regulatory approval of INPEFA on May 26, 2023, we had completed or begun the manufacturing of certain INPEFA raw materials.
The loan and security agreement includes a financial covenant relating to INPEFA net sales and a separate financial covenant which requires us to maintain a minimum cash and investments balance of $10 million until the achievement of specified INPEFA net sales. Upon funding of the fourth tranche, the minimum cash and investments balance will increase to $25 million.
In addition, we are separately required to maintain a quarterly minimum unrestricted cash and investments balance of $10 million until the achievement of specified INPEFA net sales (which will be satisfied by meeting the monthly minimum unrestricted cash and investments covenant noted above).
Financing activities provided cash of $188.0 million, primarily from approximately $139.0 million in net proceeds from the sale of an aggregate of 55,288,460 shares of common stock at a price of $2.60 per share in a public offering and concurrent private placement to an affiliate of Invus, L.P. and $50.0 million in net proceeds from the funding of the third tranche under the Oxford Term Loans.
Financing activities provided cash of $238.3 million, primarily from the issuance and sale of 2,304,147 shares of our Series A Convertible Preferred Stock in a private placement in March 2024 at a price of $108.50 per share. The preferred shares were converted into an aggregate of 115,207,350 common shares in May 2024. Other commitments.
Removed
Following FDA feedback from recent discussions, we are now preparing to resubmit our NDA for patients with type 1 diabetes and CKD. We have reported positive results from three Phase 3 clinical trials of sotagliflozin in type 1 diabetes.
Added
We are devoting most of our resources to the research and development of our most advanced drug candidates and the commercialization of our approved drug, INPEFA ® (sotagliflozin): • We are developing pilavapadin (LX 9211), an orally-delivered small molecule drug candidate, as a treatment for neuropathic pain.
Removed
We have reported positive results from a Phase 2 clinical trial of LX9211 in DPNP and top-line results from a separate Phase 2 clinical trial of LX9211 in post-herpetic neuralgia which also demonstrated evidence of effect. • We are conducting preclinical development of LX9851, an orally-delivered small molecule drug candidate, as a treatment for obesity and tool for weight management. • We are conducting preclinical research and development and preparing to conduct clinical development of compounds from a number of additional drug programs originating from our internal drug discovery efforts.
Added
We have completed three Phase 2 clinical trials ev aluating the safety and tolerability of pilavapadin and its effects on DPNP and neuropathic pain.
Removed
We expect to continue to incur significant research and development costs in connection with the continuing research and development of our drug candidates and significant selling, general and administrative expenses in connection with our commercialization of INPEFA. As a result, we will need to generate significantly higher revenues to achieve profitability.
Added
At our request, the FDA has issued a public NOOH on whether there are grounds for denying approval of our NDA and those proceedings are ongoing. • We are conducting preclinical research and development of compounds from a number of additional drug programs originating from our internal drug discovery efforts.
Removed
We are presently devoting most of our resources to the commercialization of INPEFA for heart failure, preparations for the potential commercial launch of sotagliflozin for patients with type 1 diabetes and CKD and the continued research and development of sotagliflozin, LX9211, LX9851 and our other drug candidates.
Added
Actual results could differ from those estimates and assumptions, thus impacting our reported results of operations and financial position.
Removed
These costs were partially offset by lower professional and consulting fees in 2023 when compared to costs incurred in 2022 related to preparations for the submission of our application for regulatory approval to market INPEFA for heart failure in the United States. • Personnel – Personnel costs increased 6% in 2023 to $14.3 million from $13.5 million in 2022, due to increased headcount in 2023.
Added
Revenues Revenues for the year ended December 31, 2024 were approximately $31.1 million and primarily consisted of the upfront payment of $25.0 million received from the Viatris licensing agreement and net product revenues of $6.0 million recognized from sales of INPEFA.
Removed
Years Ended December 31, 2023 and 2022 • Personnel – Personnel costs increased 181% in 2023 to $53.0 million, primarily due to higher employee salaries and benefit costs as a result of increased headcount during 2023 in conjunction with the June 2023 commercial launch of INPEFA.
Added
Overall, third-party services increased 64% in 2024 to $56.7 million, primarily driven by higher clinical external research expense associated with our current drug candidates and higher consulting fees related to the resubmission of the NDA for ZYNQUISTA. • Personnel – Personnel costs increased 16% in 2024 to $16.7 million from $14.3 million in 2023.
Removed
The increase in these costs in 2023 was primarily due to travel, training, and software licensing in conjunction with the commercial launch of INPEFA. Interest and Other Expense Interest and Other Expense .
Added
Years Ended December 31, 2024 and 2023 • Personnel – Personnel costs increased 28% in 2024 to $68.1 million as compared to the corresponding period in 2023. Salaries (including severance), bonuses, employee benefits, payroll taxes, recruiting and relocation costs are included in personnel costs.
Removed
Each share of preferred stock will automatically convert into 50 shares of our common stock upon the filing and acceptance of an amendment to our certificate of incorporation by the Secretary of State of Delaware increasing the number of authorized shares of our common stock to 450,000,000 shares.
Added
Interest Income and Other, Net Interest Income and Other, Net. Interest income and other, net increased to $12.3 million in 2024 from $7.7 million in 2023 reflecting an increase in cash and investments.
Removed
We expect to continue to devote substantial capital resources to the commercialization of INPEFA for heart failure, the commercial launch of sotagliflozin for patients with type 1 diabetes and CKD, if approved, the research and development of our drug candidates and for other general corporate activities.
Added
In March 2022, we entered into a loan and security agreement (as subsequently amended) with Oxford Finance LLC that provides up to $150 million in borrowing capacity, available in five tranches, under which $100 million has been funded under the first three tranches.
Added
Payments of $34.8 million, $52.2 million, and $20.0 million, including debt principal and final exit fee payments, will be due during the fiscal years ended December 31, 2027, December 31, 2028 and December 31, 2029, respectively, with respect to all borrowed loan tranches as of December 31, 2024.
Added
The loan and security agreement includes a financial covenant relating to net product revenue, which will be effective as of the quarter ending June 30, 2026, and a separate financial covenant which requires us to maintain a minimum unrestricted cash and investments balance of 50% of the outstanding principal amount through June 30, 2026, tested monthly as of the last day of each month.
Added
Upon funding of the fourth tranche, the quarterly minimum unrestricted cash and investments balance requirement will increase to $25 million. For additional information, please refer to Note 9 of the Notes to Consolidated Financial Statements.
Added
For additional information on the private placement offering, please refer to Note 13 of the Notes to Consolidated Financial Statements.
Added
On October 16, 2024, we entered into an exclusive license agreement with Viatris for the development and commercialization of sotagliflozin in all markets outside of the United States and Europe pursuant to which we received an upfront payment of $25 million.

Other LXRX 10-K year-over-year comparisons