UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
__________________
FORM
8-K
__________________
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date
of Report (Date of earliest event
reported): July
29, 2008
Lexicon
Pharmaceuticals, Inc.
(Exact
name of registrant as specified in its charter)
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Delaware
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000-30111
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76-0474169
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(State
or other jurisdiction of
incorporation
or organization)
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(Commission
File Number)
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(I.R.S.
Employer
Identification
Number)
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8800
Technology Forest Place
The
Woodlands, Texas 77381
(Address
of principal executive
offices
and Zip Code)
(281)
863-3000
(Registrant’s
telephone number,
including
area code)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligations of the registrant under any of the following
provisions:
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□
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Written
communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
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□
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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□
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act
(17 CFR 240.14d-2(b))
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□
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act
(17 CFR 240.13e-4(c))
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Item
2.02
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Results
of Operations and Financial
Condition
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On July
29, 2008, we issued a press release to report our financial results for the
quarter ended June 30, 2008. A copy of the press release is attached
to this current report on Form 8-K as Exhibit 99.1.
The
information in this Form 8-K and the Exhibit attached to this Form 8-K shall not
be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of
1934 (the “Exchange Act”) or otherwise subject to the liabilities of that
section, nor shall it be deemed incorporated by reference in any filing under
the Securities Act of 1933 or the Exchange Act, except as expressly set forth by
specific reference in such a filing.
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Item
9.01
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Financial Statements and
Exhibits
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(d) Exhibits
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Exhibit No.
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Description
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99.1
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—
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Press
Release of Lexicon Pharmaceuticals, Inc. dated July 29,
2008
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2
Signatures
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
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Lexicon
Pharmaceuticals, Inc.
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Date: July
29, 2008
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By:
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/s/
Jeffrey L. Wade
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Jeffrey
L. Wade
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Executive Vice President
and
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General
Counsel
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3
Index
to Exhibits
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Exhibit No.
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Description
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99.1
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—
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Press
Release of Lexicon Pharmaceuticals, Inc. dated July 29,
2008
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Exhibit
99.1
LEXICON
PHARMACEUTICALS REPORTS 2008
SECOND
QUARTER FINANCIAL RESULTS
Five
Clinical Programs Anticipated by Year-End
Conference
Call and Webcast at 11:00 a.m. Eastern Time
The Woodlands, Texas, July 29,
2008 – Lexicon Pharmaceuticals, Inc. (Nasdaq: LXRX), a
biopharmaceutical company focused on discovering and developing breakthrough
treatments for human disease, today updated its drug development progress and
reported financial results for the three and six months ended June 30,
2008.
“Our four
clinical programs are progressing well,” said Dr. Arthur T. Sands, president and
chief executive officer of Lexicon. “During this last quarter, we
achieved Fast Track status for LX1032 for carcinoid syndrome; completed Phase 1
studies of LX1031, our drug candidate for irritable bowel syndrome; and
initiated multi-dose Phase 1 trials of LX2931, our drug candidate for rheumatoid
arthritis. We are looking forward to clinical results in multiple
programs in the second half of 2008, in addition to advancing a fifth drug
candidate for diabetes into human clinical trials by the end of this
year.”
Highlights
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§
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Lexicon
received Fast Track status from the U.S. Food and Drug Administration
(FDA) for development of LX1032, the company’s orally-delivered small
molecule drug candidate for managing gastrointestinal symptoms associated
with carcinoid syndrome. Having completed a single-dose Phase
1a clinical trial, Lexicon initiated a multi-dose Phase 1b clinical trial
in June 2008. The Phase 1b trial is a randomized, double-blind,
ascending multiple-dose study designed to evaluate the safety and
tolerability of LX1032 in approximately 40 healthy
volunteers. Lexicon expects data from the Phase 1b clinical
trial before the end of the year. Results from this study will
be used to support the exploration of potentially therapeutic doses in
patients with carcinoid syndrome in accordance with its Fast Track
status. Clinical development of LX1032 is being funded through
a product development collaboration with Symphony Capital Partners, L.P.
and its co-investors.
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§
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Lexicon
completed Phase 1 studies of LX1031, the company’s orally-delivered small
molecule drug candidate for irritable bowel
syndrome.
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§
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Lexicon
initiated a Phase 1b multi-dose trial for LX2931, the company’s
orally-delivered small molecule drug candidate for autoimmune disorders
such as rheumatoid arthritis.
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§
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Lexicon
implemented a reorganization designed to reduce costs and increase
efficiencies in its research and discovery operations. As part
of the reorganization, Lexicon expects to reduce its expenses by
approximately $5 million, net of severance costs, for the balance of 2008
and approximately $11 million on an annualized
basis.
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Financial
Results
Revenues: Lexicon’s
revenues for the three months ended June 30, 2008 decreased 24 percent to
$9.6 million from $12.6 million for the corresponding period in
2007. The decrease was primarily attributable to the completion in
2007 of the project funded by Lexicon’s award from the Texas Enterprise Fund,
the completion in 2007 of the target discovery portion of its alliance with
Takeda Pharmaceutical Company Limited, and reduced revenues in the three months
ended June 30, 2008 under its alliance with N.V. Organon due to its progress
towards completing the target discovery portion of the alliance, offset in part
by higher technology license fees. For the six months ended June 30,
2008, revenues decreased 29 percent to $18.5 million from $26.1 million for
the corresponding period in 2007.
Research and Development
Expenses: Research and development expenses for the three
months ended June 30, 2008 increased 19 percent to $30.3 million from $25.6
million for the corresponding period in 2007. The increase was
primarily due to higher preclinical and clinical costs related to the
advancement of Lexicon’s drug development programs and severance costs
associated with a reduction in personnel in May 2008, partially offset by
decreased research expenses as a result of the company reallocating resources
from genetics research efforts to drug development. For the six
months ended June 30, 2008, research and development expenses increased ten
percent to $58.2 million from $52.9 million for the corresponding period in
2007.
General and Administrative
Expenses: General and administrative expenses for the three
months ended June 30, 2008 increased 12 percent to $5.6 million from $5.0
million for the corresponding period in 2007. The increase was
primarily attributable to severance costs associated with a reduction in
personnel in May 2008. For the six months ended June 30, 2008,
general and administrative expenses increased eight percent to
$11.1 million from $10.3 million for the corresponding period in
2007.
Net Loss: Net loss
for the three months ended June 30, 2008 was $20.0 million, or $0.15 per share,
compared to net loss of $13.6 million, or $0.17 per share, in the corresponding
period in 2007. Net loss for the six months ended June 30, 2008 was
$38.0 million, or $0.28 per share, compared to a net loss of $32.5 million, or
$0.41 per share, for the corresponding period in 2007. For the three
and six months ended June 30, 2008, net loss included non-cash, stock-based
compensation expense of $1.6 million and $3.4 million,
respectively. For the three and six months ended June 30, 2007, net
loss included non-cash, stock-based compensation expense of $1.7 million and
$3.2 million, respectively.
Cash and
Investments: As of June 30, 2008, Lexicon had $200.5 million
in cash and investments, including $26.9 million in cash and investments held by
Symphony Icon, as compared to $228.8 million as of March 31, 2008 and $258.8
million as of December 31, 2007.
Lexicon
Conference Call:
Lexicon
management will hold a conference call to discuss its clinical development
progress and financial results for the second quarter of 2008 at 11:00 a.m.
Eastern Time on July 29, 2008. The dial-in number for the conference
call is 888-801-6504 (within the United States) or 913-312-1504
(international). The pass code for all callers is
2543723. Investors can access a live webcast of the call at www.lexpharma.com. An
archived version of the webcast will be available on the website through August
1, 2008.
About
Lexicon
Lexicon
is a biopharmaceutical company focused on discovering and developing
breakthrough treatments for human disease. Lexicon currently has five
drug candidates in development for autoimmune disease, carcinoid syndrome,
cognitive disorders, diabetes and irritable bowel syndrome, all of which were
discovered by the company’s research team. The company is using its
proprietary gene knockout technology to characterize approximately 5,000 genes
in its Genome5000™ program,
and has discovered more than 100 promising drug targets. Lexicon has
applied small molecule chemistry and antibody technology to these
biologically-validated targets to create its extensive pipeline of clinical and
preclinical programs. Lexicon’s goal is to advance 10 drug candidates
into human clinical trials by the end of 2010, the strategic objective of its
10TO10
program. For additional information about Lexicon and its programs,
please visit www.lexpharma.com.
Safe
Harbor Statement
This
press release contains “forward-looking statements,” including statements
relating to Lexicon’s clinical development of LX6171, LX2931, LX1031, LX1032 and
LX4211 and the potential therapeutic and commercial potential of LX6171, LX2931,
LX1031, LX1032 and LX4211. This press release also contains
forward-looking statements relating to Lexicon’s growth and future operating
results, discovery and development of products, strategic alliances and
intellectual property, as well as other matters that are not historical facts or
information. All forward-looking statements are based on management’s
current assumptions and expectations and involve risks, uncertainties and other
important factors, specifically including those relating to Lexicon’s ability to
successfully conduct clinical development of LX6171, LX2931, LX1031, LX1032 and
LX4211 and preclinical and clinical development of its other potential drug
candidates, advance additional candidates into preclinical and clinical
development, obtain necessary regulatory approvals, achieve its operational
objectives, obtain patent protection for its discoveries and establish strategic
alliances, as well as additional factors relating to manufacturing, intellectual
property rights, and the therapeutic or commercial value of its drug
candidates, that may cause Lexicon’s actual results to be materially
different from any future results expressed or implied by such forward-looking
statements. Information identifying such important factors is
contained under “Factors Affecting Forward-Looking Statements” and “Risk
Factors” in Lexicon’s annual report on Form 10-K for the year ended
December 31, 2007, as filed with the Securities and Exchange
Commission. Lexicon undertakes no obligation to update or revise any
such forward-looking statements, whether as a result of new information, future
events or otherwise.
# # #
Contact for
Lexicon:
Bobbie
Faulkner
Manager,
Investor and Public Relations
281/863-3503
bfaulkner@lexpharma.com
Lexicon
Pharmaceuticals, Inc.
Selected
Financial Data
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Consolidated
Statements of Operations Data
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Three
Months Ended
June
30,
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Six
Months Ended
June
30,
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||||||||||||||
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(In
thousands, except per share data)
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2008
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2007
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2008
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2007
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||||||||||||
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(unaudited)
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(unaudited)
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|||||||||||||||
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Revenues:
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||||||||||||||||
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Collaborative research
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$ | 7,953 | $ | 12,477 | $ | 15,587 | $ | 24,748 | ||||||||
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Subscription and license fees
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1,613 | 171 | 2,872 | 1,395 | ||||||||||||
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Total revenues
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9,566 | 12,648 | 18,459 | 26,143 | ||||||||||||
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Operating
expenses:
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Research
and development, including stock-based compensation of
$950, $1,044, $2,077 and $2,035, respectively
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30,349 | 25,594 | 58,151 | 52,884 | ||||||||||||
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General
and administrative, including stock-based compensation of
$633, $627, $1,285 and $1,195, respectively
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5,603 | 5,004 | 11,132 | 10,304 | ||||||||||||
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Total operating expenses
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35,952 | 30,598 | 69,283 | 63,188 | ||||||||||||
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Loss
from operations
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(26,386 | ) | (17,950 | ) | (50,824 | ) | (37,045 | ) | ||||||||
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Interest
income
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1,418 | 765 | 4,199 | 1,645 | ||||||||||||
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Interest
expense
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(675 | ) | (695 | ) | (1,345 | ) | (1,383 | ) | ||||||||
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Other
expense, net
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(539 | ) | (14 | ) | (1,086 | ) | (26 | ) | ||||||||
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Loss
before noncontrolling interest in Symphony Icon, Inc.
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(26,182 | ) | (17,894 | ) | (49,056 | ) | (36,809 | ) | ||||||||
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Loss
attributable to noncontrolling interest in Symphony Icon,
Inc.
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6,148 | 4,303 | 11,072 | 4,303 | ||||||||||||
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Net
loss
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$ | (20,034 | ) | $ | (13,591 | ) | $ | (37,984 | ) | $ | (32,506 | ) | ||||
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Net
loss per common share, basic and diluted
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$ | (0.15 | ) | $ | (0.17 | ) | $ | (0.28 | ) | $ | (0.41 | ) | ||||
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Shares
used in computing net loss per common share, basic and
diluted
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136,796 | 79,568 | 136,795 | 78,758 | ||||||||||||
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Consolidated
Balance Sheet Data
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As
of June 30,
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As
of December 31,
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||||||
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(In
thousands)
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2008
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2007
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||||||
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(unaudited)
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||||||||
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Cash
and investments, including cash and investments held by Symphony Icon,
Inc.
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$ | 200,517 | $ | 258,775 | ||||
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Property
and equipment, net
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68,104 | 70,829 | ||||||
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Goodwill
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25,798 | 25,798 | ||||||
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Total
assets
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310,306 | 369,296 | ||||||
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Deferred
revenue
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24,535 | 34,156 | ||||||
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Current
and long-term debt
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30,942 | 31,373 | ||||||
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Noncontrolling
interest in Symphony Icon, Inc.
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19,199 | 30,271 | ||||||
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Accumulated
deficit
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(448,519 | ) | (410,535 | ) | ||||
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Total
stockholders’ equity
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218,457 | 256,300 | ||||||