On pharmaceuticals. In attendance today are Lonnel Coats, CEO, Jeff Wade, President and CFO, Craig Granowitz, SVP and CMO, and Tom Garner, SVP and CCO. Gentlemen, welcome. Thanks so much for coming down to Miami for our conference. A lot to dig into, but before we get into specifics, I'd love to kick it off with you guys. Maybe spend three to five minutes giving an overview on where Lexicon is going, and perhaps maybe highlight some nuances that aren't well appreciated or well noticed by the Street. I'll start, if you don't mind. This is Lonnel. A couple things. One is that it's such an awesome opportunity where we are right now. We have INPEFA that is now becoming well received in the marketplace as an important treatment option for heart failure, especially for those patients who are recently discharged, or who are, who are had a recent event. And so a very specific area, because of a unique label that we have, give us an opportunity to address those patients. The second thing I would say is that what a remarkable class to be in. The SGLT class is growing 70% month-over-month from the last data I saw, and the overall branded heart failure market is growing 40%. Now, why is this important? It's important because the SGLTs are only just scratching the surface of heart failure, so there's a lot of green space still to be made up. It's important because we believe as we execute well on the launch of INPEFA, INPEFA will also get its rightful share and grow with the market. When we look at what we're doing right now, we're off to a fairly good start. Our objective this year is really to try to get greater and broader access. That's important because once we get that, then quite frankly, when we get particularly into the end of the first half of this year, or next year, I should say, I think we will start to see great acceleration on INPEFA, in a market like this. Then the last thing I'll say about INPEFA is that the patents around INPEFA is long, which when we look at its unique mechanism, which is not just an SGLT2, but also a SGLT1, what we do is we try to mine our data that we have and look at how the drug is being used in market and try to figure out, are there additional applications for this compound? We believe the answer to that is yes. So we'll have a lot more to say in the coming months about where we think there's an appropriate opportunity to continue to expand INPEFA and broaden its label. Right now, we're focused on getting the inflection point off of this launch, off of this indication. Then that turns us to LX9211. There haven't been a new innovation in neuropathic pain for more than 20 years. Equally important is there hasn't been a remarkably successful compound in phase II for neuropathic pain, until LX9211 is now changing that narrative. You know, our phase II-A data was quite remarkable. We showed clinical statistical significance in that data. The only question is out there now is, can we optimize the dose from what we saw in terms of the effectiveness of the compound? And that takes us into late-stage development, where we're developing a phase II-B study to optimize the dose and allow us to very efficiently move it into phase III. And so with those two primary objectives for the company, our job is to manage our capital in a way in which allows us to get to the inflection point on both of those as we go into 2024. Excellent, excellent. A lot to unpack here. So let's just start with INPEFA and the commercial considerations you're facing this year. Obviously, it's one of-- you know, INPEFA is one of three SGLT inhibitors that are approved for heart failure. So... And I get asked this question a lot. I mean, in terms of the commercial payers that you're trying to get on formulary with, how does Lexicon plan to compete with Big Pharma, who could probably offer better discounted and more bundling options? So I, I'll take that one. So, it's a fair point. Obviously, we do not have a large portfolio that we can leverage. However, I can tell you that the discussions that we've had with payers, given the data that Lonnel mentioned, given the differentiated data that we have for both SOLOIST and also for the SCORED study, I think, payers and clinicians alike appreciate that there is value for patients here. And there's also value for payers as well, because as you think about kind of this period that we're about to enter with uncertainty around IRA, obviously, a number of the products are potentially going to be, well, are going to be going LOE as well. A product like INPEFA that has this very long runway in terms of patent protection actually prevents a useful hedge for a number of these companies to think about long-term value for them in terms of rebates. So I think that those two elements coupled together, the clinical value coupled with the actual value to the payer, is resonating well. And that's why, quite honestly, we've seen some pretty significant off-cycle wins, which I don't think many people necessarily anticipated, the most recent being the big Express Scripts win, which was effective November 1. So we're continuing to make good progress and are excited by the fact that the discussions that we've had, even as we enter the 2025, 2026 bid cycle, we think there is further opportunity to actually gain access through 2024 and that time period. Got it. Got it. And what's the current status of the, the payer formulary access? I think you mentioned on your last earnings call, it was 25% of lives covered. Correct. Have there been any improvements recently? And is it safe to assume that most of that right now is commercial payers right now, rather than— Okay, taking the second question first. So our split at the moment between commercial and Medicare in terms of covered lives is around 60/40. So 60% coverage for commercial, 40% for Medicare. But we continue to make good progress in terms of the discussions that we're having on both sides of the formulary. So, yes, we have continued to make good progress through Q4. Obviously, we'll be sharing more as we can through our Q1 earnings, but that number of 25% has increased pretty significantly since we provided that update. Got it. And you also mentioned the concept of off-cycle bid submission for Medicare. I know there are certain windows that you can submit outside of the normal bidding window. How is that going? And you know, are these off-cycle bid windows still available for 2024 this late in the year? Yes. So at the moment, obviously, we are in the bid process, the bid window for 2025, 2026. But most payers, if they can appreciate the value, and we can ensure that there's kind of a fair value to the payer as well, are open to pulling that window forwards in terms of access. So absolutely, we do think that you'll continue to see access wins through the back end of this year. We've already announced that there'll be some other significant wins going live January first, and we do think that we'll be able to continue to drive additional formulary wins through the first half of 2024. Got it. Got it. So since it's still early in the game based on the fact that it does take a while to get on hospital formularies. Is it fair to assume that at this stage in the launch, I guess the patient mix mostly consists of patients who are getting INPEFA once they're out of the hospital? Yep. So as with most new products, there is a six-month moratorium, generally, a new-to-market block in terms of formulary access. So we're coming to the end of that window now, which is good. We are already very actively involved with targeting high-value institutions that see a high volume of heart failures, and that process is ongoing. As we work through this, obviously, we begin to see additional formulary wins. I think we had mentioned prior that we'd had two GPO contracts signed. Pleased to announce we've had a third one signed, third signed since, so we only have one outstanding. And we believe that this now gives us a great platform to really begin to execute that pull-through of formulary wins within the hospital setting. At the moment, to your first question, yeah, I mean, the vast majority of our patients at the moment are those being treated either in the academic setting or in the community setting with either worsening symptoms of heart failure, or they have been recently discharged, and the customer believes that INPEFA is the best choice for them. I see. I see. I see. And I know you guys have unique data, and that you're the only, you have the only data set among all the SGLTs that have data specifically upon discharge. I mean, like, is that resonating well with payers, or, you know, is there an inkling or a tendency to just lump them all together? I think it is resonating. I mean, a number of payers now are becoming fully integrated. Obviously, they're managing both the medical benefit and the pharmacy benefit. So if they can gain fair value in terms of the pharmacy benefit and then ensure patients aren't coming back in, which is often, you know, a very large problem for heart failure patients, is this idea that they get washed out, they get dried out, they leave the hospital, and then they come back within a matter of weeks or months. INPEFA, we have standout data that really demonstrates that with this compound, you can prevent that happening, and that does resonate well with payers, I can tell you. Got it. One more kind of a macro-oriented question as it pertains to INPEFA. So as GLP-1s and even Alzheimer's drugs begin to stretch the whole, the Medicare budget, why won't prices come down once Farxiga and Jardiance go generic? I mean, I think if you look at kind of generic entry into markets such as this, that are large, they're growing, you know, generic prices don't always reach the floor that we assume that they will do v ery, very quickly. We certainly think that that's going to be the place here. And again, as we think about the value story that we have for INPEFA, with this long runway of patient protection, with the fact that we have this unique data set, the fact that we are only focusing on heart failure, we're not broad like the other SGLTs, we think that this presents a great long-term business opportunity for the company moving forward. Got it. Excellent, excellent. Let me switch gears now to LX9211 for DPNP. So, you had very promising phase II results, and the primary endpoint in the upcoming phase II-B and phase III trials will be the average daily pain score, which was what was used in the phase II RELIEF- DPN trial. However, in RELIEF- DPN, I guess the primary endpoint was measured at six weeks, whereas in the upcoming phase II and phase III trials, it will be measured at eight and 12 weeks, respectively. So having said that, like, why push out the timing of the primary endpoint in these future trials, and what gives you confidence that efficacy could be maintained beyond six weeks? Craig, why don't you take that? Thank you. Great question. And, you know, these trials have been done with different endpoints in mind, in terms of number of weeks. Generally, the registered and approved products are between 8 and 12 weeks. So we did the first proof of concept with 6 weeks just to see if we could get efficacy, and we saw efficacy as early as the first week, which was maintained throughout the entire dosing period. For the phase II-B, again, we've done both the phase II-B and the presumptive phase III program, and we have feedback from both clinical experts, regulatory experts, and the FDA, is that for this trial, again, looking at 8 weeks, which is in the realm of what has been used for registrational trials, is certainly acceptable. And that's why we wanted to have the study done sooner rather than later. But for 12 weeks with the phase III, that was also something that FDA was interested in. So we've really looked at a different range of endpoints with different goals in mind of, first, proof of concept. Second, finalizing the dose in this phase II-B late-stage dose optimization trial, and then moving to the pivotal trials over this range. We believe the efficacy will be maintained based on the fact that we saw efficacy so early, and the benefit was maintained with a similar benefit from placebo over the entire dosing interval. Got it. Got it. Well, this is neurology and pain, so placebo rates can have been known to run rampant. So perhaps maybe speak to ways that you plan on mitigating placebo response in these studies? Well, the good news is that we've already been able to do it effectively, and we've gotten a lot of positive feedback, particularly from the KOLs, around the consistency of the data, the quality of the data. Remember, this trial was done in the middle of a pandemic. So from that standpoint, we feel quite confident of the way that we are profiling the patients going in. Now, we did learn during that because we had a very high screen failure rate, so we had a homogeneous group of patients. But we believe that what we've learned, based on the and based on the fact that the pandemic is over, that we're going to be able to have a similarly consistent group of patients, but possibly a lower screen fail rate. Got it. Got it. I'd like to just focus more on the dose optimization goal of the upcoming phase II-B trial. Are you aiming to establish a minimally effective dose, or push the dose higher than what was used in RELIEF- DPN, or maybe increase the loading doses? Well, it's really the first two. So the loading dose, as you might recall from the proof of concept, had 10 times the maintenance dose on the first day of dosing. So what we learned from that study is that was probably hitting the patients harder than we would like for a longer-term dosing regimen. We also know based on intensive PK work, that we believe that the 20 dose, in terms of blood levels, might do a little bit better than the 10, just looking at a positive dose-response curve. So by putting all that together, we think that we are pushing the dose to what is an acceptable dose with the 20, because we know that after the first couple weeks, those patients had a slightly higher dropout rate than placebo. We know with the 10, we have a dose that worked in the phase II-A study, and that dose is as well-tolerated as placebo after the first couple weeks, and we were able then to modify that induction dose with that first 10 times the loading dose. We don't think that we need to go that heavy, but we picked an intermediate dose with getting to the adequate drug levels or the minimally effective drug levels faster by giving 20 milligrams a day for the first 7 days. So we really feel like we've covered all the bases that you mentioned in this trial. So, okay, so you're dosing higher with a slightly higher induction dosing. But what about the plateauing effect that was seen in RELIEF- DPN? I mean, will this higher dosing circumvent that, or what's your PK modeling suggest? Yeah. So again, I just want to clarify that we're not pushing the dose. It really is the same dose that was used in the II-A with that 20 maintenance. Okay. Sorry about that. The induction dose is either no induction dose or 20, which is much lower than what we used in the II-A study. We've really tried to learn based on really mining that phase II-A study intensively. We think we've really got the right balance of dose exposure to really hone in on a final dose for the phase III program, which would be two parallel, two-arm studies, with one is the optimized dose picked from the phase II-B dose optimization study versus placebo. So we feel that we have both not changed the timelines, because we have an extension study off the phase II-B that will give exposure out to a year without losing any time, and then we would have overlapping in this phase III study start with the long-term extension study from the phase II-B, with doses that we feel that we've already demonstrated, based on the modeling, that we are really right in the right range for this drug. Got it. One last design question. So in the prior RELIEF- DPN trial, patients were allowed to remain on at least one background pain med during the trial. Is it the same situation with these future trials, or were they allowed patients to be on more than one background med, and, and might that skew results somewhat? Well, the issue is, most of them that are on multiple medications, prescription medications, is going to be an opiate plus something else. Right. So we're not allowing patients on the opiate, but we are allowing them, just like in the RELIEF- DPN study, to be on one background non-opiate medication at a stable dose. And we think that is a real advantage because we would be then potentially indicated both in monotherapy or on top of current standard of care. Got it. And remind us of, of the timing of, of these trials. They're starting soon, correct? The first patient should be initiated into the study very shortly, and I think we've publicly already communicated that dosing will be complete by the end of 2024, with you know, all patients in, with results in by second quarter of 2025. Great. Great. I guess in the last couple of minutes we have left, just remind us of your cash balance and your burn and the runway you have. So we had cash at the end of the last quarter, just over $218 million. We have a loan facility with Oxford, and it also provides some additional financial flexibility, and we're expecting that the resources that we have will take us into 2025. Got it. Got it. Excellent, gentlemen. I mean, is there anything that we didn't cover that should have covered it at this point? Yeah. One thing I would just add on to something that Craig said, and this relates to the design of the study, but also to the market opportunity for LX9211. That design of the study that allows patients to stay on one medication for DPNP, I think is much more real-world than a lot of studies. So patients who are already getting some benefit, but it's not adequate, can come into this study. That's how the drug is actually gonna get used in the real world. Yeah. They're not gonna pull people off a therapy that's providing some benefit, but not enough in order to put them on LX9211. They're gonna add it on if they're getting benefit, and if they're not getting benefit from another drug, then they're gonna use it by itself. So this study design actually looks at what the real world opportunity is. It's also not contrived, so when you pull somebody off, obviously their pain score is gonna go up, and then you are measuring off of an elevated pain score. So this is... The fact that we succeeded in the study, it's really lined up with the real world. But it's also an important value proposition because that's something that people are really looking for from a market perspective, is something that can be added on to additional therapies as well as used on its own. I see. So last question, too. Any updates on your ex-US commercialization plan for INPEFA and, assuming LX9211 gets approved, what are your ex-US commercialization plans at this point? Yeah. So we will only intend to commercialize outside the United States with a partner. So we're having discussions about INPEFA. We anticipate having discussions about LX9211 as we get further in development. And with LX9211, there's the additional aspect of this could be developed in parallel in multiple types of neuropathic pain. That's beyond our capability in terms of resourcing. We can do the diabetic peripheral neuropathic pain, but to do something in parallel beyond that, we'd need to have a partner for that. And that's something that we may be having discussions about as we get closer to the time of this data. Excellent. Well, unfortunately, this is all the time we have left. Thank you, gentlemen, for coming down to Miami and spending some time with us, and enjoy the rest of the conference. Thank you. Thank you. Thank you.