$LXRX Positive TopLine Results, Phase 3 #Sotagliflozin in #Diabetes

First Successful Phase 3 Trial of an Oral Anti-diabetic for Type 1 Diabetes Conference call and webcast September 9, 2016 at 8:00 a.m. Eastern Time

THE WOODLANDS, Texas, Sept. 9, 2016  — Lexicon Pharmaceuticals, Inc. (Nasdaq: LXRX) announced today that the pivotal inTandem1 Phase 3 clinical trial of sotagliflozin met its primary endpoint, showing a statistically significant reduction in A1C at 24 weeks in patients with type 1 diabetes on a background of optimized insulin.

Top-line results from the Phase 3 study showed that patients treated with sotagliflozin had a mean A1C reduction from baseline of 0.43% on 200mg once daily sotagliflozin dose (p<0.001) and a reduction of 0.49% on 400mg once daily sotagliflozin dose (p<0.001) as compared to a reduction of 0.08% on placebo after 24 weeks of treatment, meeting the study’s primary endpoint.  This statistically significant and clinically meaningful improvement in A1C for both doses of sotagliflozin was achieved without an increase in severe hypoglycemia, one of the most prevalent serious health challenges in type 1 diabetes, which was seen less frequently in both treatment arms than placebo.

“We are extremely pleased with these top-line results and the potential long-term benefits that sotagliflozin may bring to people with type 1 diabetes,” said Lexicon President and Chief Executive Officer Lonnel Coats.  “We believe these results provide evidence that sotagliflozin, with its novel dual inhibition of both SGLT-1 and SGLT-2, is particularly well suited to help these individuals achieve better A1C levels without increasing and possibly reducing the risk of severe hypoglycemia.”

“Our companies are working together to develop this compound for the treatment of type 1 and type 2 diabetes,” said Jorge Insuasty, Senior Vice President, Head of Global Development, Sanofi.  “These top-line results highlight potential benefits of sotagliflozin when treating adults with type 1 diabetes.  We congratulate our partners on this positive outcome and look forward to further exploring this compound for the treatment of adults with type 2 diabetes when Sanofi begins the Phase 3 program later this year.”

“The inTandem1 study is part of the largest Phase 3 program for an oral anti-diabetic agent in type 1 diabetes to date,” said Anne Peters, M.D., Professor of Medicine at the Keck School of Medicine of USC, Director of the USC Clinical Diabetes Programs and Chairman of the Sotagliflozin Type 1 Diabetes Steering Committee.  “Sotagliflozin demonstrated compelling, significant and clinically meaningful A1C reduction with no increase in severe hypoglycemia and a slight risk of DKA.  If approved, sotagliflozin could represent a significant addition to the current standard of care and potentially allow patients with type 1 diabetes to better manage their diabetes while on insulin.”

About inTandem1

The double-blind, placebo controlled, Phase 3 study known as inTandem1 enrolled 793 patients in the United States and Canada with type 1 diabetes on insulin pump or multiple daily injection therapy who had an A1C level entering the study between 7.0% and 11.0%, which corresponds to an estimated average blood sugar of 154 mg/dl to 269 mg/dl (8.6 mmol/l to 15.0 mmol/l).  The three-arm study evaluated two doses of sotagliflozin, 200mg and 400mg, each taken once daily before the first meal of the day, against placebo.  Prior to randomization, insulin was optimized for all patients over a six-week period, with the objective of improving glycemic control using insulin alone.  After completion of this optimization period, patients were maintained on optimized insulin and randomized to one of two doses of sotagliflozin or placebo, and their baseline, post-optimization A1C was measured.  The mean baseline A1C level at the time of randomization after the six-week optimization period was 7.6% for all three dose arms.

The primary endpoint of the study was change in A1C from baseline after a 24-week period of treatment.  The trial has a double-blind long term extension of 28-weeks, with a total treatment duration of 52-weeks. There were 268 patients in the placebo arm, 263 patients in the 200mg dose arm and 262 patients in the 400mg dose arm.  The overall mean placebo adjusted A1C reduction was 0.35% in the 200mg dose arm (p<0.001) and 0.41% in the 400mg dose arm (p<0.001).

Sotagliflozin was generally well tolerated.  Across all three dose arms (placebo, 200mg, 400mg), the incidence of treatment-emergent adverse events (AEs) were 67.5%, 67.3% and 71.0%, respectively; the incidence of serious AEs (SAEs) were 3.4%, 3.8% and 6.9%, respectively; and discontinuation due to AEs were 1.5%, 1.1% and 3.8%, respectively.  There were no reported deaths in the study.

Two primary safety concerns for patients with type 1 diabetes are severe hypoglycemia and diabetic ketoacidosis (DKA).  The number of patients with severe hypoglycemic events during the 24-week treatment period was 18 (6.7%), 11 (4.2%), and 12 (4.6%) in the placebo, 200mg and 400mg dose arms, respectively.  The number of patients with DKA events during the 24-week treatment period was 0 (0.0%), 3 (1.1%), and 8 (3.1%) in the placebo, 200mg and 400mg dose arms, respectively.

Lexicon is conducting another similar pivotal Phase 3 clinical trial predominantly in Europe (inTandem2), which is expected to report top-line results by the end of the year.  The third type 1 diabetes Phase 3 clinical trial, inTandem3, is underway globally and is studying approximately 1,400 patients treated with sotagliflozin 400mg once daily or placebo on a background of any insulin therapy, but without insulin optimization prior to randomization. Sanofi is expected to commence Phase 3 clinical trials for sotagliflozin in patients with type 2 diabetes by the end of the year.

About Sotagliflozin

Discovered using Lexicon’s unique approach to gene science, sotagliflozin is a first-in-class, oral dual inhibitor of two proteins responsible for glucose regulation known as sodium-glucose co-transporter types 1 and 2 (SGLT1 and SGLT2). SGLT1 is responsible for glucose absorption in the gastrointestinal tract, and SGLT2 is responsible for glucose reabsorption by the kidney. Sotagliflozin has been shown in a Phase 2 study to improve glycemic control in people with type 1 diabetes while reducing their need for mealtime insulin.

Lexicon entered into a collaboration and license agreement with Sanofi in November 2015 under which Lexicon granted Sanofi an exclusive, worldwide, royalty-bearing right and license to develop, manufacture and commercialize sotagliflozin.  Lexicon is responsible for all clinical development activities relating to type 1 diabetes and retains an exclusive option to co-promote and have a significant role, in collaboration with Sanofi, in the commercialization of sotagliflozin for the treatment of type 1 diabetes in the United States.  Sanofi is responsible for all clinical development and commercialization of sotagliflozin for the treatment of type 2 diabetes worldwide and is solely responsible for the commercialization of sotagliflozin for the treatment of type 1 diabetes outside the United States.

Lexicon Conference Call

Lexicon management will hold a conference call and webcast to discuss the inTandem1 Phase 3 top-line results at 8:00 a.m. Eastern Time on September 9, 2016.  The dial-in number for the conference call is 888-645-5785 (within the US/Canada) or 970-300-1531 (international).  The conference ID for all callers is 79513441.  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 October 9, 2016.

About Lexicon

Lexicon is a fully integrated biopharmaceutical company that is applying a unique approach to gene science based on Nobel Prize-winning technology to discover and develop precise medicines for patients with serious, chronic conditions. Through its Genome5000™ program, Lexicon scientists have studied the role and function of nearly 5,000 genes over the last 20 years and have identified more than 100 protein targets with significant therapeutic potential in a range of diseases. Through the precise targeting of these proteins, Lexicon is pioneering the discovery and development of innovative medicines to safely and effectively treat disease. Lexicon has a pipeline of promising drug candidates in clinical and pre-clinical development in oncology, diabetes and metabolism. For additional information please visit www.lexpharma.com.

Safe Harbor Statement

This press release contains “forward-looking statements,” including statements relating to Lexicon’s and its licensees’ clinical development of and regulatory filings for sotagliflozin (LX4211) and the results and projected timing of clinical trials and the potential therapeutic and commercial potential of sotagliflozin. In addition, 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 the risk that clinical studies of sotagliflozin may be halted, delayed or otherwise not demonstrate safety or efficacy, the risk that the FDA and other regulatory authorities may not grant regulatory approval of sotagliflozin in accordance with Lexicon’s currently anticipated timelines or at all, and the risk that such regulatory approvals, if granted, may have significant limitations on the approved use of sotagliflozin. As a result, sotagliflozin may never be successfully commercialized. Other risks include Lexicon’s ability to meet its capital requirements, successfully conduct preclinical and clinical development and obtain necessary regulatory approvals of its other potential drug candidates, 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. Any of these risks, uncertainties and other factors 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 “Risk Factors” in Lexicon’s annual report on Form 10-K for the year ended December 31, 2015, 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.