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Transcript Summary

Lexicon Pharmaceuticals reported a productive 2025, highlighted by significant regulatory and clinical milestones. The company's lead program, sotagliflozin, is seeing strong momentum with the Phase III Sonata trial in HCM exceeding 50% enrollment and an expected NDA resubmission for Zynquista in type 1 diabetes in 2026 following positive FDA feedback on the STENO-1 study data. In chronic pain, pilovapitan is Phase III-ready for diabetic peripheral neuropathic pain after a successful FDA meeting; Lexicon is actively seeking a partner for its next stage of development. Their obesity asset, LX9851, licensed to Novo Nordisk, recently triggered a $10 million milestone, with more expected this year. Financially, Lexicon has dramatically reduced its cash burn, with 2025 operating expenses down $129.5 million year-over-year. Following a recent $100 million capital raise, the company is well-capitalized with a cash runway to support its 2026 goals, including mid-year completion of HCM enrollment and potential T1D approval. Management remains focused on operational excellence and high-impact cardiometabolic opportunities, positioning 2026 as a pivotal year for regulatory submissions and clinical readouts.

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Lexicon Pharmaceuticals, Inc.: Milestone Dependency and Massive Share Expansion Mask Structural Cash Burn

Full Earnings Call Transcript — Q4 • 2026-03-05

Operator: Welcome to the Lexicon Pharmaceuticals, Inc. Fourth Quarter and Full Year 2025 Financial Results Conference Call. At this time, all participants are in a listen-only mode. Following management's prepared remarks, we will hold a brief question-and-answer session. As a reminder, this call is being recorded today, 03/05/2026. I will now turn the call over to Lisa DeFrancesco, SVP, Investor Relations and Corporate Communications for Lexicon Pharmaceuticals, Inc. Please go ahead, Lisa.
Lisa DeFrancesco: Thank you, Michelle. Good morning, and welcome to our Q4 and full year 2025 Earnings Conference Call. Joining me today are Dr. Michael S. Exton, Lexicon Pharmaceuticals, Inc.'s Chief Executive Officer and Director; Dr. Craig B. Granowitz, Senior Vice President and Chief Medical Officer; and Scott M. Coiante, Senior Vice President and Chief Financial Officer. This morning, Lexicon Pharmaceuticals, Inc. issued a press release announcing our financial results for the fourth quarter and full year of 2025, which is available on our website at www.lexpharma.com and through our SEC filings. A webcast of this call, along with a slide presentation, is also available on our website. During this call, we will review the information provided in the release, provide a corporate update, and then use the remainder of our time to answer your questions. Before we begin, let me remind you that we will be making forward-looking statements, including statements related to the safety, efficacy, clinical development, regulatory status, and therapeutic and commercial potential of sotagliflozin, pilovapitan, LX9851, and our other drug programs, as well as our business generally. These statements may include characterizations and projections related to clinical development, regulatory status, and market opportunity for our drug programs, and commercial performance of INPEFA for heart failure. This call may also contain forward-looking statements relating to our growth and future operating results, discovery and development of our drug candidates, strategic alliances, and intellectual property, as well as other matters that are not historical fact or information. Various risks may cause our actual results to differ materially from those expressed or implied in such forward-looking statements. We refer you to our most recent Annual Report on Form 10-Ks and other SEC filings for detailed information describing such risks. I will now turn the call over to Michael S. Exton. Mike?
Michael S. Exton: Yes, thanks, Lisa. Good day, everyone. Thanks for joining us today. As I reflect back on this year, my first full year as CEO at Lexicon Pharmaceuticals, Inc., I am enormously proud of all the progress we have made. In addition to all we have accomplished in 2025, we had a tremendously productive start to this year, so we are excited to give you some updates on our recent progress and discuss the many important milestones ahead of us in 2026. By way of a high-level overview, Lexicon Pharmaceuticals, Inc. is advancing three very strong, novel, late-stage programs in the therapeutic areas of cardiometabolic disease and chronic pain. In cardiometabolic, we have sotagliflozin, which is currently in late-stage development in hypertrophic cardiomyopathy. We are also planning an NDA submission for sotagliflozin in type 1 diabetes and collaborating with our licensee, Beatrice, on making sotagliflozin available in patients outside the U.S. and Europe. We also have our novel, oral, early-stage program in obesity, LX9851, which is being advanced by Novo Nordisk. Within chronic pain, we have pilovapitan, a Phase III-ready drug candidate for diabetic peripheral neuropathic pain. Each of these programs have key potential catalysts upcoming, which we will cover shortly. Any one of these programs alone would represent a significant scientific achievement to be excited about, but taken together, they comprise a portfolio that we are quite proud of. Now, before I jump into the details and next steps for each of these programs, I want to emphasize that in addition to the R&D excellence behind this pipeline, we have also been diligent about driving operational excellence, as well as improving our financial position and cost structure to sustainably support our core programs going forward. So looking ahead, we have set clear goals for what we need to achieve in 2026. The Sonata HCM Phase III trial of SOTA for obstructive and nonobstructive is enrolling well, and we expect to complete enrollment in the middle of this year. We received feedback from FDA that data from the third-party STENO-1 study can support an NDA resubmission for Zynquista for glycemic control in type 1 diabetes if supported by patient exposure and safety data from the study. Now, based on the data we have seen thus far, we expect to resubmit in 2026 with potential approval later this year. Our partnership strategy continues as we support our existing licensees, Novo Nordisk and Beatrice, while also exploring new partnerships where appropriate to augment our capabilities, including seeking a partner for Phase III development of pilovapitan. And last but not least, we are financially well positioned following our recent raise. We plan to maintain our operational discipline to support long-term growth with diligent expense management and continued focus on deploying capital towards the highest value, highest impact opportunities. Collectively, this truly demonstrates our lead-to-succeed strategy in action. Now, we entered 2026 with significant momentum, and that has really continued in the first few months of the year. In January and February alone, we announced a successful end of Phase II meeting with pilovapitan in DPNP with no objections raised by the FDA to advancement into Phase III development. We strengthened our financial position with more than $100 million in additional cash from our recent capital raise as well as the Novo Nordisk milestone payment. We continued enrollment in the ongoing Sonata HCM Phase III study of sotagliflozin for HCM, surpassing 50% enrollment completion earlier this quarter, and progressed our work towards a potential resubmission of our NDA for Zynquista in type 1 diabetes later this year, if the STENO-1 patient exposure and safety data requirements identified by the FDA are achieved. So as you can see, we are very much off and running, and so much more to come. With that, I will ask Craig to provide a deeper dive on our lead programs. Craig?
Craig B. Granowitz: Thank you, Mike, and good morning, everyone. As most of you know, our pipeline is focused in two primary therapy areas, the first being cardiometabolic disease and the second being chronic pain. I will start with our cardiometabolic platform, sotagliflozin. As we approach important upcoming milestones for sotagliflozin in both HCM and T1D, it is an opportune time to review sotagliflozin's unique mechanism of action. As the only dual inhibitor of both SGLT1 and SGLT2, we want to focus on the importance of the SGLT1 effects. While SGLT2 is expressed primarily in the kidney, SGLT1 is expressed in the kidney but also in other tissues, particularly the GI tract and the heart, as well as the endothelium. We believe that inhibition of SGLT1 in the GI tract is important in postprandial glycemic control in patients with T1D. Similarly, we believe that inhibition of SGLT1 in the heart has important effects on myocardial health, particularly in disease states like HCM. It is also thought that inhibition of SGLT1 in the endothelium may be important in reduction of ischemic events like stroke and MI. The graphic on the next slide demonstrates the distribution of SGLT1 and SGLT2 protein expression in human tissues. On the right-hand side of the panel, it is evident that SGLT2 expression occurs primarily in the kidney. SGLT1, but not SGLT2, is expressed in the GI tract and heart. It is also noteworthy that SGLT1 expression in the heart is significantly upregulated in patients with ischemic heart conditions and in patients with hypertrophic cardiomyopathy. We will continue to discuss these and other factors contributing to the growing body of evidence supporting the potential benefit of SGLT1 inhibition for the treatment of HCM in the coming months. The mechanistic differentiation leads us to the rationale behind our current development efforts for sotagliflozin, a potential first-in-class therapy for HCM and glycemic management in type 1 diabetes. Regarding HCM, interest and awareness of the disease has been growing, particularly with new treatment options becoming available, but this disease remains an area of severe unmet need for both people with obstructive HCM and particularly those with nonobstructive HCM. Our Sonata HCM Phase III study includes patients from both populations, and top-line results are expected in 2027. In type 1 diabetes, Lexicon Pharmaceuticals, Inc. has been committed to the development of a novel treatment for glycemic control in patients with T1D for many years. The FDA has provided feedback that clinical trial data from STENO-1, a third-party funded investigator-initiated study of sotagliflozin, may support a resubmission of our NDA for Zynquista in T1D. Based on the study data we have seen to date, we are preparing to resubmit the NDA and potentially receive regulatory approval in 2026. Elaborating further on the opportunity for HCM, our Phase III Sonata HCM study is a large, global, registrational trial with a KCCQ endpoint, designed to support a regulatory filing and broad label in HCM. We have completed the initiation of our target 130+ study sites in approximately 20 countries across the United States, Europe, Israel, and Latin America. I could not be more proud of the team's significant efforts in achieving this goal. Sonata is the only registrational trial currently enrolling patients with both obstructive and nonobstructive HCM. The study is pragmatic in design, allowing for patients currently being treated on a CMI. The enrollment in the study is stratified but not capped, and as Mike mentioned, we have surpassed the 50% enrollment target earlier this quarter and are on track to complete enrollment by midyear. As I mentioned earlier, as a dual inhibitor of SGLT1 and SGLT2, we believe that sotagliflozin could offer distinct advantages for the treatment of obstructive and nonobstructive HCM. Importantly, it is the only drug, to our knowledge, in clinical development for HCM that works both inside and outside the heart. It acts directly on the myocardium to modify cellular energetics, and we believe it has the potential to be a first-line agent with no REMS in both obstructive and nonobstructive HCM. Additionally, sotagliflozin is already approved for heart failure, with no observed risk of A-fib to date. This is important given that many patients who have HCM go on to experience major adverse cardiovascular events, such as myocardial infarction, stroke, or heart failure. Complementing the upcoming clinical results from the Sonata trial are two investigator-initiated trials, the SOTAcardia and the SOTA Cross studies. SOTAcardia, data from which was presented at the American Heart Association meeting last November, evaluated the effects of sotagliflozin in patients with HFpEF without diabetes with a baseline ejection fraction greater than 50%. Clinically, these patients have a number of symptomatic and anatomical characteristics similar to those with nonobstructive HCM. Data from SOTAcardia showed improvements in patient symptoms such as KCCQ score and six-minute walk test, as well as cardiac function, such as left ventricular mass and left atrial filling pressure, findings which support the rationale for sotagliflozin's use in nonobstructive HCM. SOTA Cross is a crossover study evaluating sotagliflozin in symptomatic nonobstructive HCM. This is an ongoing 12-week crossover study with a readout expected in 2027, measuring a number of outcomes, including cardiac function, symptoms, and biomarkers. Moving on to the next slide, there is a growing body of evidence that supports sotagliflozin's unique potential for reducing cardiovascular events. This slide highlights recent data presented at the Scientific Sessions and the HCM Society and an upcoming presentation at the American College of Cardiology's 75th Annual Scientific Sessions that highlights sotagliflozin's impact on cardiac remodeling in HCM, the benefits of sotagliflozin in HFpEF, and sotagliflozin's effects on MACE events in patients with type 2 diabetes. In summary, we are excited to complete enrollment in Sonata HCM and look forward to upcoming data presentations at ACC and several HCM-related medical meetings in the second half of this year. Now turning to Zynquista, our sotagliflozin program in type 1 diabetes. As we previously announced, we had productive meetings with the FDA in late 2025, during which they confirmed that STENO-1, a third-party funded investigator-initiated study of sotagliflozin being conducted by the Steno Diabetes Center in Denmark, appears to be sufficient to support a review of a resubmission of our NDA for Zynquista in T1D. Based on current STENO-1 enrollment estimates and safety data we have received to date, we are planning for an NDA resubmission and potential regulatory approval in 2026. There are approximately one million patients with type 1 diabetes in the United States, and there has not been a new therapy approved for over a century to help those patients achieve glycemic control alongside insulin. That is an unacceptable status quo. The outpouring of support for Zynquista from the diabetes community has been remarkable and reinforces what we have always known. These patients desperately need new treatment options. If approved, Zynquista would be the first and only oral therapy in class for type 1 diabetes. It is not just a commercial opportunity, though certainly it is, but it is a chance to fundamentally improve how we treat this challenging medical condition. Global development of LX9851 in obesity remains on track, and our progress on this program triggered a $10 million milestone payment in February under our license to Novo Nordisk, with potential for another $20 million in additional milestones in 2026. We have now fully handed off development to Novo Nordisk following the completion of IND-enabling activities, and we are encouraged by the continued enthusiasm for this asset and its novel mechanism. Just this week, the Journal of the Endocrine Society highlighted our recent publication on ACSL5 inhibition as a featured article. These preclinical data provide some insights as to the potential of ACSL5 as a target and LX9851 as a drug candidate for obesity and chronic weight management. In addition to our cardiometabolic programs, Lexicon Pharmaceuticals, Inc. also has a Phase III-ready non-opioid asset for neuropathic pain, pilovapitan. Pilovapitan is a novel investigational agent targeting AAK1, and like sotagliflozin, pilovapitan has a broad pipeline and appeal potential. Our lead indication for pilovapitan is DPNP, supported by two Phase II studies that provide evidence of consistent and clinically meaningful pain reduction. We have accumulated data from more than 600 patients treated with pilovapitan and have demonstrated a well-understood and acceptable safety and tolerability profile. Beyond DPNP, we believe there are other potential applications for pilovapitan. The AAK1 pathway is central to a number of cellular processes such as synaptic signaling between neurons involved in pain signaling and spasticity. With this in mind, we are conducting IND-enabling work in multiple exciting neuroscience indications. As Mike mentioned, we had a successful end of Phase II meeting with the FDA for pilovapitan in DPNP. During that meeting, FDA raised no objections to the advancement of pilovapitan into Phase III development in that indication. The Phase III program would include two placebo-controlled, 12-week, two-arm registrational studies comparing a 10 milligram daily dose to placebo. The primary endpoint of the Phase III studies would be placebo-controlled change in average daily pain score from baseline to Week 12. FDA also confirmed that it will not require any additional preclinical or clinical studies that would be expected to complicate or delay the advancement of the program into Phase III development and potential regulatory submission. With this regulatory alignment in hand, we are continuing our ongoing discussions with partners. I will now turn it over to Scott to provide an update on the company's financials.
Scott M. Coiante: Thank you, Craig. We begin this morning with our results for both fourth quarter and full year of 2025. Total revenues were $5.5 million and $49.8 million for the quarter and year ended 12/31/2025, respectively. Revenues for the fourth quarter of 2025 include $4.3 million of licensing revenue recognized from the Novo Nordisk agreement and net sales of INPEFA of $1.1 million. Revenues for the year ended 12/31/2025 include $45 million of licensing revenue from the Novo Nordisk agreement and $4.6 million of net sales of INPEFA. Total revenues for the fourth quarter and full year 2024 include the upfront payment of $25 million received upon entering into the Viatris license agreement, and net sales of INPEFA of $1.6 million and $6 million, respectively. Research and development expenses for the fourth quarter of 2025 decreased to $11.3 million from $26.7 million in 2024. Full year 2025 research and development expenses decreased to $61.1 million from $84.5 million in 2024, primarily reflecting lower external research expenses from our progress in Phase II clinical trial, partially offset by increased investment in our Sonata Phase III clinical trial. Selling, general and administrative expenses for the fourth quarter of 2025 decreased to $8.8 million from $32.3 million in 2024. Full year 2025 SG&A expenses decreased to $37.3 million from $143.1 million in 2024. The decrease in 2025 reflects lower costs resulting from the company's strategic repositioning in late 2024 and our significantly reduced marketing and promotional efforts for INPEFA in 2025. Net loss for the fourth quarter of 2025 was $15.5 million, or $0.04 per share, compared to a net loss of $33.8 million, or $0.09 per share, in the corresponding period in 2024. Net loss for the full year 2025 was $50.3 million, or $0.14 per share, compared to a net loss of $200.4 million, or $0.63 per share, in the same period in 2024. For the fourth quarter of 2025 and 2024, net loss included non-cash stock-based compensation expense of $2.8 million and $1.5 million, respectively. And for the full years of 2025 and 2024, net loss included non-cash stock-based compensation expense of $12.5 million and $13.5 million, respectively. As of 12/31/2025, Lexicon Pharmaceuticals, Inc. had $125.2 million in cash, investments, and restricted cash, as compared to $238 million in cash and investments as of 12/31/2024. Subsequent to year-end, Lexicon Pharmaceuticals, Inc. strengthened its cash position by more than $100 million from net proceeds received from the sale of common and preferred stock and a milestone payment from Novo Nordisk. I would like to now note a few financial highlights from both the fourth quarter and full year 2025. In addition to the revenue highlights, which I mentioned previously, operating expenses were reduced by $39 million for the fourth quarter of 2025 as compared to the fourth quarter of 2024. We continue to look for ways to reduce costs and streamline our operations. We also meaningfully improved our cost structure for 2025, with operating expenses down $129.5 million for 2025 as compared to 2024, reflecting our strategic repositioning in late 2024 and substantially reduced marketing and promotional spend for INPEFA in 2025. In addition, we also reduced our total debt by approximately $46.3 million in 2025, primarily using the proceeds from the Novo Nordisk upfront payment. Moving ahead to 2026, we expect total operating expenses to be between $100 million and $110 million. R&D expenses are expected to be between $63 million and $68 million and do not include costs associated with Phase III pivotal studies of pilovapitan, as our goal would be to move this asset forward with a development partner. SG&A expenses, which include sales and marketing expenses, are expected to range between $37 million and $42 million. I will now turn it back to Mike for closing remarks.
Michael S. Exton: Yes, thanks, Scott. Now, before we turn to Q&A, I just want to say again how excited we are about the year ahead in 2026. Last year was a year of progress, and 2026 is a year of potential and possibility with several pivotal milestones ahead across our three core programs, with multiple upcoming catalysts that we believe can drive substantial value creation. From pilovapitan partnership opportunities in neuropathic pain, to sotagliflozin's multiple shots on goal across HCM, heart failure, and type 1 diabetes, to LX9851's near-term milestone potential in obesity, we are really firing on all cylinders this year. Each of these programs addresses serious unmet medical needs, and each has the potential to be transformative for patients who desperately need new treatment options. We have the pipeline, we have the team, and we have the momentum, and I am incredibly excited about what lies ahead. We will now open for questions. Operator, please go ahead. Craig and Scott and I will take your questions.
Operator: Thank you. To withdraw your question, please press 1, 1 again. We ask that you please limit yourselves to one question and one follow-up before reentering the queue. One moment for our first question. Our first question will come from the line of Andrew Tsai with Jefferies.
Matt (for Andrew Tsai, Jefferies): Hey, good morning. This is Matt dialing in for Andrew Tsai. Congrats on the progress this quarter. Just a couple of questions from me. How much patient work updated does the open-label IST STENO-1 study have on DKA safety right now for you to be able to guide to a potential approval in 2026? And then what are the exact timelines from submission to approval that you are expecting? Is this going to be a Class 1 or Class 2 resubmission here?
Michael S. Exton: Yes, thanks, Matt. I will let Craig talk about the data. We are expecting a six-month review here, so reemphasizing that the data that we are seeing, we expect a submission this year and as well an approval before the end of 2026. Craig, do you want to talk about the data that we are seeing?
Craig B. Granowitz: Yes. So, again, Matt, I need to be a bit careful because this is not our trial. It is an investigator-initiated study. But as a reminder, this is a large trial. It is 2,000 patients total: 1,000 patients which were on or are considered the standard of care and then another 1,000 which are randomized based on baseline characteristics to enhanced care, which would include sotagliflozin in a significant percentage of patients but also the possibility of being on semaglutide and/or Kerendia, depending upon baseline patient demographics. The study has enrolled the majority of the patients. And, again, I do not want to overstep Dr. Rossing and the Steno group, but enrollment has proceeded briskly. I think you can see some of their updates on clintrials.gov, and the enrollment, as we laid out with FDA, is proceeding to plan. We pre-agreed with FDA on two important criteria for resubmission. The first would be the total exposure required. The second would be a rate of DKA. I can be a bit more expressive about the second criteria because the FDA put that in their end-of-review letter: that they were really looking for a rate of diabetic ketoacidosis at or below that achieved with the 400 milligram dose arm in the inTandem program, which, in the FDA's parlance, was a number needed to harm of about 26, which corresponds to a rate of about 3.5 cases per 100 patient-years. I can tell you that currently we are tracking in a way, both in terms of total exposure and DKA rates, that give us a high degree of confidence in where we stand in terms of our submission and approval timelines that both Mike and I highlighted during the call.
Operator: Thank you. And one moment for our next question. Our next question comes from the line of Yigal Nochomovitz with Citigroup.
Yigal Nochomovitz: Okay, thank you. I have got a question on the partnerships for the pain program. So you had the end of Phase II meeting. Could you just talk about how much the results from that meeting have accelerated partnering discussions since then? And is there a clearer line of sight to transacting something this year? Thank you. And also, how much more can you say about what Novo plans to do with 9,851? You know, in terms of how it is going to be inserted into the development program, meaning in combo with the GLP-1 or for those perhaps not responding well enough, or perhaps even as a maintenance therapy, you know, following the course of GLP-1 therapy? What can you say there? Is that really Novo's call now?
Michael S. Exton: Yes, thanks, Yigal. So I would not say that they accelerated because we are in constant dialogue with a number of partners that we have been communicating with, but it allowed the conversations to be a little more specific and obviously provide some confidence around the program being able to move into Phase III and take away that sort of regulatory risk, if you like, which has been incredibly well received by partners. So we continue to talk details with them and look forward to providing some more updates in the very near future. Yes. I do not necessarily want to speak on Novo, but I think I have sort of hypothesized where I think that LX9851 would fit into the treatment paradigm and certainly with some of the background for their enthusiasm. But before I do that, Yigal, let me just reinforce how impressed we have been with the Novo team. And I think you know, we all recognize that perhaps they are sort of losing the battle in injectables and have really pivoted strongly towards oral formulations as being the future and their future in obesity management. And, really, we have had that hypothesis all along that the future of obesity treatment will be in oral combinations of different MOAs, just like it is in most of cardiometabolic disease, whether it be hypertension, hyperlipidemia, etcetera, because it allows you to get synergies by combining different MOAs, and orals obviously facilitate that ability to drive combinations. I think they are being very open, and they therefore are really doing an incredible amount of work on this program to see whether it is going to be as a standalone monotherapy, to see whether it is in combination, to see whether it is right at the initiation of treatment, whether it becomes a maintenance therapy. I think all of those options are on the table for them, and they are really driving very, very hard, which gives us confidence, as we mentioned in the opening remarks, around the potential of receiving those two further milestones this year, which would really be an accelerated Phase I development. And we are excited about the possibility of clearing that hurdle and then really getting into Phase II and beyond, which would be very material for the company. Craig, do you have any additional thoughts?
Craig B. Granowitz: I will just add from the scientific standpoint, the mechanism is complementary to semaglutide. You know, as we have communicated, I think it is nicely summarized in the Journal of the Endocrine Society paper that just came out this week. As we mentioned during the prepared remarks, this mechanism is thought to be really the only agent that is in development acting on what is called the ileal brake, which is a very different neuroendocrine signal of satiety that we have seen and we have communicated, I think, at prior meetings, could act additively both to the amylin mechanism and certainly to the GLP or semaglutide mechanism. So I think that is really how Novo is thinking about this, that this agent could be acting either alone or in combination with semaglutide, or potentially in an additional combination with both an amylin analog and semaglutide analog. But, again, we do not want to speak for Novo, our partner.
Operator: Thank you. And one moment for our next question. Our next question is going to come from the line of Joseph Pantginis with H.C. Wainwright.
Joseph Pantginis: Hey, guys. Good morning. Thanks for taking the question. So, Mike, I know the intent for pilovapitan is moving forward with an expected partner, but I want to ask the question this way. So, based on, you know, the larger coffers that you have now and how things are rapidly progressing with the data and your FDA discussions, are you looking towards any sort of flexibility or optionality with regard to even starting the study on your own prior to getting a partner? That is very helpful. Thank you. And maybe a question for Craig here. When you look at the SOTA profile for HCM, just curious how you believe the SOTAcardia and SOTA Cross studies on the periphery could potentially impact future sNDAs and/or the marketing potential as you look at the broadening profile for SOTA in HCM?
Michael S. Exton: Yes. It is a great question, Joe, and it is a great position to be in when you have got a number of opportunities ahead of you. And, you know, we are really very much focused on our near-term cardiometabolic opportunities. So I think what we see in the opportunity with T1D for SOTA as well as HCM are both incredibly large commercial opportunities for us, and so we are very much focused on driving that forward. We have been continuing to do some work in preparation of what the Phase III program would look like for pilovapitan. And, in fact, that has been a part of the partnering discussions as well, as we continue to sort of engage in a very granular timeframe of what would be expected moving forward. And even that is changing as we speak. As you know, the recent announcement by Dr. Makary for one-trial possibility is something that is coming into our thought process as well. We need to consider that as a possibility for pilovapitan, as we will be for all programs. So we are doing work in parallel, but we are not going to invest the financial commitment to commencing a Phase III trial for pilovapitan because we really want to invest that cash for both T1D and HCM at the moment. Craig, did you have anything else?
Craig B. Granowitz: Yes, I think, Mike, you summarized the strategic part really well. I just wanted to reinforce the importance of the patient groups in the legislative dimension as well. And what we have seen in this regard is tremendous interest from the patient community in really trying to bring that into a legislative position. As well as, as you know, Joe, a lot has been done in the acute pain setting, particularly in light of the opiate situation. Patients who are on chronic pain treatment like DPNP are at much higher risk of actually developing opiate addiction. There has been a really strong interest across the board in the pain community, both on the opioid avoidance side as well as the diabetes community, in terms of really trying to put momentum behind this effort from a legislative front. So we are really trying to approach this from multiple different ways: a regulatory, legislative, patient access standpoint, as well as, as Mike said, we have really now finalized what the development program would be under standard conditions based on the end of Phase II meeting. So we continue to really look at all of these areas as the discussions continue because we do not want to just have the asset sitting there.
Michael S. Exton: Yes, no, exactly. So I think Craig summarized that well. There is a bunch of activity that we are doing to continue the preparation for the program, in parallel with the discussions. But our investment of capital is squarely focused at this time on Zynquista and HCM because we see those opportunities coming at us very, very fast.
Craig B. Granowitz: Yes, thanks for the question, Joe. You know, we try to approach this in a way that really is the sum of the total is far greater than each of the individual parts. And we have really tried to take a pragmatic design approach to Sonata HCM that would be clear, efficient, and rapid, that would spare capital in terms of doing a study that would achieve the goals of the FDA and other health authorities, but not add dramatically to the cost or slow enrollment. And in that regard, we are really looking at SOTA Cross, SOTAcardia, and a number of other trials that we have been discussing, investigator-initiated trials looking at various imaging, functional, and patient feel outcomes that would complement the primary endpoint of Sonata HCM. And we hope that the sum total of all of that will provide more mechanistic understanding of how the SGLT class will complement that of the CMIs, and also could be the first and only in HCM, but also to differentiate the dual mechanism of SOTA and the SGLT1 effects from the SGLT2 inhibitors that are not being studied and have no data in HCM.
Michael S. Exton: Yes, no, and just allow me to throw a little more color onto that, Joe, because it is a very important element of our portfolio, and we think it is a great opportunity not only for SOTA and patients with HCM, but for Lexicon Pharmaceuticals, Inc. So as we noted, we did raise, you know, close to $100 million earlier this year, and we are spending a small portion of that this year at the moment, as, sorry, Scott gave in his guidance for the year. But one of the important elements that we are going to undertake is to have a small field medical team to really bring about what is a ton of evidence now showing, you know, a lot of the reason to believe of SGLT1 as being a new class of medicine and having evidence that indicates it will be a very significant medicine for both obstructive and nonobstructive HCM. So we are going to employ that field force as we march towards the data in Q1 2027 to not only talk about Sonata, not only talk about SOTA Cross and SOTAcardia, which are very important elements, but a lot of the mechanistic evidence, one of which we presented today. And I think as we sort of educate the physician community beyond top KOLs, we really see why SOTA has significant potential in HCM. So it is really an important focus for the company over the next 12 months. Thank you, guys.
Operator: Thank you. And one moment for our next question. Our next question comes from the line of Yasmeen Rahimi with Piper Sandler.
Shannon (for Yasmeen Rahimi, Piper Sandler): Hi, this is Shannon on for Yasmeen Rahimi. Congrats on progress, and thanks for taking our question. Can you just help us understand your visibility and confidence for getting the additional 50% enrollment for Sonata by mid-2026? And then, also, is the cadence of that enrollment the same in both cohorts for nHCM and oHCM? Great. Thank you so much.
Michael S. Exton: Yes, great, great question. So I will let Craig have first go with that one.
Craig B. Granowitz: Yes, Shannon, it is a great question. We have a really nice window right now of enrollment. There are not a lot of competing global trials right now. We have, as I mentioned during the prepared remarks, all 130 sites now open across 20+ countries, and we are at that, what I would call, steep part of the S-shaped enrollment curve. We have sort of gotten over the early parts. We have had a few protocol amendments to make enrollment, clarify things where there were open issues, and enrollment has really ticked up consistent or ahead of our projections at this point. And as Mike mentioned, we have crossed the 50% enrollment target much earlier in this quarter, and we see continued uptake in enrollment across all of the regions. The U.S., Europe, and Latin America are all contributing. Your second part of your question regarding enrollment is we have enrolled significant numbers of patients with both obstructive and nonobstructive HCM. What we are seeing, not surprisingly, is that there are some patients, particularly at these large academic centers, that are being treated currently with the CMIs for obstructive. So we are seeing even more patient inflow for the nonobstructive cohort than the obstructive cohort, but we believe that we have enough patients in both cohorts to achieve what we set out in the trial. And as we mentioned, the trial is stratified but not capped, so we did stratify the patients based on their baseline of either being obstructive or nonobstructive, but we have not set a formal cap of a specific number of each group, and that we did discuss and align with FDA before we started the trial.
Michael S. Exton: And, Shannon, it is a great point. Enrollment is never linear, as all those people know who have run clinical trials in any clinical trial. And, you know, we have our target curve, and our enrollment curve is right on that target curve, and we continue to enroll strongly such that we have a high degree of confidence that we will hit that midyear target, which will have then a data readout in 2027.
Operator: Thank you. And one moment for our next question. Our next question comes from the line of Roanna Ruiz with Leerink Partners.
Michael (for Roanna Ruiz, Leerink Partners): Hi, this is Michael on for Ruiz at Leerink Partners. Thank you for taking our question. I have a question about the Phase III design of the pilovapitan program. Previously, you mentioned several measures to mitigate the placebo response that you saw previously. Are you able to comment on what the enrollment criteria changes will look like for Phase III? Like, for instance, will you require a minimum pain score threshold, things like that? Thank you. Great. Thank you so much.
Michael S. Exton: Yes, great, great question, Michael. Thank you for that question. I think the changes that we are going to have, as we have mentioned, probably the single largest change we are going to have is actually to expand enrollment. During the year, we did run a renal impairment study, and we believe that having a renal impairment study completed with no impact on clearance with GFRs down to 30 significantly increases the enrollment potential for this study. There is a high degree of correlation between neuropathy and nephropathy, both in terms of the enhancement of patients but also the severity of their neuropathic pain. As GFR drops, you tend to see a higher percentage of patients that have neuropathic pain, but also the more severe neuropathic pain. In terms of the other entry criteria, we are really looking at similar pain scores at baseline. I think the only change that we looked at—and we looked at a number of variables that might have affected the placebo rate—on the patient characteristics, the only one that we saw that was meaningful, and, again, this is all retrospective, looking back at the completed data, was the duration of their neuropathy prior to enrollment. So we might make some minor changes to the enrollment criteria in terms of the duration of their neuropathy of about a year. I believe in the Phase II study it was six months, but to extend that to approximately one year. The other major elements that, in talking to our advisers and to the FDA and in discussions with them, we are going to do more regarding the training of patients during the pain score, because, again, reinforcing constantly how to use the visual analog scale for pain management, both with the sites and the patients, is another element that we think that we can do to have more consistency across patient enrollment in the study sites. And also, we now have a large number of study sites that have significant experience with us running these trials because we have now run two large trials, two large Phase II trials, so we think we have a good supply of sites to enroll these studies that will have experience with this drug and now have experience with doing DPNP studies.
Operator: Thank you. I am showing no further questions at this time, and I would like to hand the conference back over to Michael S. Exton for closing remarks.
Michael S. Exton: Yes, thanks so much, operator, and thanks, everyone, for your questions. Very much appreciated. Look, as I reflect on 2025, moving into 2026, the company has made a leap forward, in my opinion. If you think about where we were last year, we needed to really summarize all of the Phase II data for pilovapitan, we needed to find a path forward for Zynquista, we needed to accelerate the enrollment of SOTA in HCM. And fast forward to nearly at the end of 2026, and we now have clarity on pilovapitan, and partnership discussions are ongoing, we are on the precipice of a resubmission for Zynquista, and we are nearly closing the enrollment of the HCM study, Sonata, with a readout in 2027. So we have got an amazing set of opportunities ahead of us, and hopefully you can see how pumped we are about all of those things coming our way in 2026 and beyond. So we feel very good. We are pushing very hard and look forward to giving you some more updates as the year progresses. So thanks very much, everyone.
Operator: This concludes today's conference call. Thank you for participating, and you may now disconnect. Everyone have a great day.