Lexicon Pharmaceuticals (NASDAQ:LXRX) reported a wider second-quarter loss as revenue declined sharply from the prior-year period, while the company highlighted completed enrollment in its Phase III SONATA-HCM trial and outlined plans to resubmit a new drug application for ZYNQUISTA in type 1 diabetes during the fourth quarter.
Total revenue for the quarter ended June 30 was $0.7 million, compared with $28.9 million a year earlier. Second-quarter 2026 revenue represented net sales of INPEFA, while the prior-year quarter included $27.5 million of licensing revenue related to the company’s agreement with Novo Nordisk, in addition to INPEFA sales.
SONATA-HCM Enrollment Completed
Chief Executive Officer Mike Exton said Lexicon completed enrollment in SONATA-HCM, a Phase III study evaluating sotagliflozin in patients with hypertrophic cardiomyopathy, or HCM. The company said the study was significantly over-enrolled and described it as the largest Phase III study to date involving both obstructive and non-obstructive HCM.
Lexicon expects to report top-line results from the trial in the first quarter of 2027. The study’s primary efficacy endpoint is the change from baseline to week 26 in the Kansas City Cardiomyopathy Questionnaire Clinical Summary Score, or KCCQ-CSS, across the overall study population.
Chief Medical Officer Craig Granowitz said the trial enrolled a substantial majority of patients with non-obstructive HCM, a population for which the company said treatment options remain limited, along with a meaningful cohort of obstructive HCM patients. Patients receiving stable guideline-directed HCM therapy, including cardiac myosin inhibitors, were permitted to enroll.
During the question-and-answer session, Granowitz said the trial is powered for the combined obstructive and non-obstructive population. He added that the over-enrollment increased management’s confidence in the study’s ability to assess the primary endpoint and that the company expects sufficient obstructive-HCM enrollment to evaluate results in both groups.
Exton said Lexicon views sotagliflozin as potentially usable either alone or alongside cardiac myosin inhibitors, though any future commercial positioning would depend on clinical and regulatory outcomes.
ZYNQUISTA Resubmission Targeted for Fourth Quarter
Lexicon said the STENO-1 study, an open-label investigator-initiated study being conducted by the Steno Diabetes Center in Denmark, is expected to reach the patient-exposure level requested by the U.S. Food and Drug Administration by the end of August.
The FDA had requested a prospective study, adequate patient exposure and diabetic ketoacidosis, or DKA, rates below those seen in Lexicon’s earlier clinical trials to support resubmission of the ZYNQUISTA new drug application. Granowitz said DKA rates among sotagliflozin-treated patients in STENO-1 have been similar to the study’s standard-of-care group and below rates observed in Lexicon’s prior inTandem studies.
The company expects to complete the administrative work needed to collect and transfer patient-level data after the exposure threshold is reached. Lexicon currently anticipates an NDA resubmission during the fourth quarter, with Granowitz citing the end of October as the company’s current estimate.
In response to an analyst question on potential review timing, Exton said a six-month review following an end-of-October filing could place a decision in the second quarter of 2027. He noted, however, that the company intends to discuss whether a quicker review may be possible because the FDA has already received much of the information expected in the filing.
Outside the U.S. and Europe, Lexicon licensee Viatris has secured regulatory approvals for sotagliflozin in the United Arab Emirates and Bahrain. Viatris has also submitted applications in more than a dozen additional markets, including Saudi Arabia, Canada and Australia. Regulatory decisions in Canada and Australia are anticipated this year, according to Lexicon.
Earlier-Stage Programs and Financial Position
Lexicon said LX9851, an oral small-molecule inhibitor of ACSL5 being developed for obesity, is in a Phase I study being conducted by Novo Nordisk. Lexicon has received two $10 million milestone payments under its license agreement with Novo Nordisk and said it could receive a third $10 million milestone later this year.
The company also said it is conducting preclinical work to explore additional potential indications for pilavapadin, which uses an AAK1 inhibition mechanism. Lexicon said it expects to share preclinical data as early as later this year.
Research and development expense rose to $17.4 million from $15.7 million a year earlier, driven by higher external costs related to the SONATA-HCM trial. Selling, general and administrative expense increased to $9.8 million from $9.4 million.
As of June 30, Lexicon had $190.6 million in cash equivalents and short-term investments, compared with $125.2 million in cash equivalents, short-term investments and restricted cash at the end of 2025.
In May, the company announced a $100 million debt facility with Hercules Capital. An initial $55 million tranche was funded at closing and used to repay the Oxford Finance facility. Lexicon may access an additional $20 million subject to clinical, regulatory and financial milestones, while a further $25 million tranche would require Hercules’ consent and meet specified timing requirements.
Lexicon reiterated its 2026 operating expense guidance of $100 million to $110 million, including expected research and development spending of $63 million to $68 million and selling, general and administrative spending of $37 million to $42 million. The company said it began targeted pre-commercial investments during the second quarter, including medical education, marketing preparation and market-access activities.
About Lexicon Pharmaceuticals (NASDAQ:LXRX)
Lexicon Pharmaceuticals, Inc is a biopharmaceutical company focused on the discovery and development of novel medicines through its proprietary genome biology platform. By leveraging large-scale gene knockout libraries, the company identifies potential therapeutic targets and advances them through preclinical and clinical development. Lexicon’s approach emphasizes the translation of genetic insights into targeted therapies for a range of human diseases.
The company’s most advanced product is telotristat ethyl (sold under the brand name XERMELO), an oral treatment approved for the management of carcinoid syndrome diarrhea in patients inadequately controlled by somatostatin analog therapy.
