Lexicon's CEO Presents At Wedbush PacGrow 2012 Life Sciences Management Access Conference (Transcript)

Lexicon Pharmaceuticals, Inc. (LXRX)

Wedbush PacGrow 2012 Life Sciences Management Access Conference Transcript

August 14, 2012 10:55 AM ET

Executives

Dr. Arthur Sands - President and CEO

Analysts

Liana Moussatos - Wedbush

Presentation

Liana Moussatos - Wedbush

I guess we'll get started. I'm Liana Moussatos from Wedbush. Welcome to our Third Annual LS MAC Conference. Right now we have Dr. Arthur Sands, CEO of Lexicon Pharmaceuticals, who'll give us a corporate update. Dr. Sands?

Dr. Arthur Sands

Thank you, Leigh Ann. It's a pleasure to be with you today. I will be making certain forward-looking statements and so I'd like to refer you to our filings with the SEC regarding risk factors that affect our business and our pipeline. So, it's been a very exciting and very busy summer for Lexicon as we've received our data from our LX4211 Phase 2b trial in diabetes. And I'll spend most of the session today describing the data from that trial. But I'll also put in context of our broader development plan for LX4211 as we get ready to move into Phase 3 with that compound.

Now all the compounds of Lexicon derive from our genetics engine. Our mission for those of you who don't know is we're dedicated to developing truly breakthrough therapies for disease that are all targeted in nature that as we use genetics and gene knockout technology to define the target, and so all of our programs are genetically defined as targets. And then we have a medicinal chemistry group that develops small molecules for those targets. So our entire pipeline has been developed within this research engine with genetics at the beginning and then getting to small molecule development.

So that's from the source of all these compounds in development. As you can see, we have quite an extensive and growing pipeline. Again, I'll spend most of the time on our diabetes programs and then I'll only describe briefly, have time for our serotonin programs and carcinoid syndrome and IBS at the end.

So let's turn to diabetes then. 4211, this is a very unique compound. It's the first-in-class agent in that it blocks both SGLT1 and 2. These are the two key transporters in the body that handle glucose. So it affects the glucose load in the body. And SGLT1 target is the primary transporter in the GI tract and this is I think brings us 4211 the unique attributes that I'll describe.

SGLT2 is a better known target. It's under development at a number of companies. It's the main transporter in the kidney and it controls the rate of glucose, the reabsorption from the urine back into the blood. But together we have found these transporters work in a coordinated fashion really to regulate the glucose -- overall glucose load in the body. And by blocking them, we can reduce that load.

In the GI tract, you reduce the amount of glucose that comes into the body and also trigger other beneficial mechanisms including Glip 1 and then with SGLT2, you can actually offload more glucose into the urine.

Now the industry has really, as I said, mostly focused on SGLT2 as you can see by this column to the right, a number of large companies with their partners. And the reason they avoided SGLT1 in the beginning is there was a theoretical concern that blocking that target might cause GI side effects. Indeed, there are humans lacking SGLT1 and a complete lack of the target does lead to a glucose-galactose malabsorption syndrome. And so that put off researchers from that target.

Now what we learned is we develop compounds that could hit SGLT2 or hit both that pharmacologic inhibition did not create that side effect profile, and that was a very important observation that we made first in our mice and our knockout mice and then using our compound that allowed us to have a therapeutic window of the advantages of SGLT1 without the disadvantages of the theoretical concerns.

So that created a unique space for us and for our compound LX 4211. It profiled better in our preclinical models than the SGLT2 selective compounds we had and it continues to perform better, and we think now is profiling better in humans in clinical trials. So that's the evolution, the genesis of us of being here with a unique dual inhibitor.

So our development strategy then. First and foremost, of course in diabetes you have to establish your agent has very robust glycemic control. It's a competitive space. There are a lot of agents out there, a lot of well established still patented agents, but also very old agents that actually do provide some level of benefit. So you have to demonstrate benefit on top of those. And ideally with a new mechanism of action, something that offers a new benefit to patients. And I think that our dual mechanism does offer that.

SGLT1 mechanism, as we've been the only one to really explore this so far in the clinic, also provides certain additional benefits in glycemic control, specifically potent postprandial or after meal time glycemic control. That spike in glucose after meals which is a very important and somewhat convey to a certain amount of -- ultimately morbidity of diabetes is that spike right after meals. SGLT1 on the GI tract allows us to blunt that and I'll show you some data we have to that effect.

Secondly, we have demonstrated in our program consistent metabolic benefits that now a diabetes agent can't just control blood sugar, it has to control other things as well; body weight, blood pressure ideally and this translating then to long-term benefits and cardiovascular risks and these of course are the trials that are required in Phase 3. So that's part of our core strategy here.

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