Lexicon Pharmaceuticals, Inc.

Good morning. My name is Julian and I will be your conference operator today. At this time, I would like to welcome everyone to the Lexican Pharmaceutical third quarter 2020 financial results call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star then the number one in your telephone keypad. If you would like to redire your question, press the pound key. I would now like to hand the conference over to your first speaker today, Chas Schultz. You may begin.

Thank you, Julianne. Good morning, and welcome to the Lexicon Pharmaceuticals Third Quarter 2020 Financial Results and Clinical Update Conference Call. Joining me today are Lynelle Coates, Lexicon's President and Chief Executive Officer, Dr. Praveen Tile, Lexicon's Executive Vice President of Research and Development, and Jeff Wade, Lexicon's Executive Vice President of Corporate and Administrative Affairs and Chief Financial Officer. Earlier today, Lexicon issued a press release announcing our financial results for the third quarter of 2020, 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 available on our website. During this call, we will review the information provided in the release provide an update on our clinical programs, 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 the statements relating to the safety, efficacy, and the therapeutic and commercial potential of LX9211, Sotocoflozin, and other potential drug candidates. These statements may include characterizations of the expected timing and results of clinical trials of LX9211, Sotocoplosin, and other drug candidates and the regulatory status and market opportunity for those programs. 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 facts or information. Various risks may cause our actual results to differ materially from those expressed or implied in such forward-looking statements. These risks include uncertainties related to the timing and results of clinical trials and preclinical studies of LX9211, Sotocoflozin, and our other drug candidates, our dependence upon strategic alliances and other third-party relationships, our ability to obtain patent protections for our discoveries, limitations imposed by patents owned or controlled by third parties, and the requirements of substantial funding to conduct our research and development activities. For a list and a description of the risk and uncertainties that we face, please see the reports we have filed with the Securities and Exchange Commission. I will now turn the call over to Linnell Coates.

Thank you, Chas. Good morning, everyone, and thank you for joining us on the call. We welcome the opportunity to discuss a pivotal quarter for Lexicon in which we shifted our focus to LX9211 and our other scientific assets and research and developments. During the third quarter, we completed the sale of Zamello and related assets to Tessera Therapeutics. This sale allowed us to strengthen our balance sheet by repaying our $150 million term loan in full. We also exchanged $75.8 million in principal amount of our convertible notes for cash and common stock and have retired more than 90% of our outstanding debt in total. We are in a very good position to focus our time and efforts on the advancement of LX9211, which is a program we have been excited about for a number of years. Praveen will share more about this program and the potential we see for it to become a new treatment option for the millions of people suffering from neuropathic pain. Starting in the fourth quarter, Lexicon will be operating as a much more streamlined and focused company. We expect our cash bearing to be dramatically lower moving forward into 2021, and we will be laser focused on advancing LX9211 through two phase two clinical trials in diabetic peripheral neuropathic pain and post-herpetic neuralgia. Jeff will delve into the financials more deeply, including our outlook on expected spend moving forward. I feel confident that with the delevering of our balance sheet and a substantial reduction in our expected spend, We are in a much better position to advance our science and increase the opportunity for values to flow through to our stakeholders. On slide four, I would like to take a quick moment and remind everyone that Sotocoflozin remains an important asset in our science and development pipeline. This is a drug that we wholly own and continue to believe has the potential to become a very important new treatment for the many people living with type 1 diabetes. Sotagliflozin has shown in a Phase III program involving approximately 3,000 patients to be effective as an adjunct to insulin in reducing A1C and achieving other secondary efficacy endpoints, which led to an approval in Europe for type 1 diabetes last year. We continue to believe that the diabetic ketoacidosis risk observed in a Phase III program is manageable, and we will continue to seek approval in the United States. At this point, we feel there is an opportunity to initiate the next phase of our strategy and reengage with the FDA. It is important that we gain alignment with the agency on a clear pathway forward in type 1 diabetes, and we plan to start that work this quarter. We will be providing updates to you in the coming months as we make progress toward this outcome. We're also completing the early closeout of SCORD and SOLOIS, two outcome studies of psilocybin with primary endpoints evaluating a composite of total cardiovascular death, hospitalizations for heart failure, and urgent visits for heart failure. The outcomes of those trials will be presented as part of a late-breaker session titled Late-Breaking Science at the upcoming American Heart Association Scientific Session on November 16th at 8 p.m. Eastern Time, so set your calendars. With that, I would like to invite Praveen to update you on our important pipeline asset, 9211. Dr. Tayo? Thank you, Linnell.