Lexicon Pharmaceuticals reported third‑quarter 2025 results that surpassed analyst expectations, driven largely by a $13.2 million licensing payment from Novo Nordisk and a modest $1.0 million in sales of its approved product INPEFA. Total revenue reached $14.2 million, a 7‑fold increase over the $1.8 million earned in the same quarter a year earlier, and a $9.5 million beat on the consensus estimate of roughly $4.7 million. Net loss narrowed to $12.8 million, a $52 million improvement from the $64.8 million loss in Q3 2024, and translated into a loss of $0.04 per share versus the consensus estimate of a $0.07 loss – an EPS beat of $0.03 per share.
The sharp decline in operating costs underpins the improved profitability. Research and development expenses fell to $18.8 million from $25.8 million a year ago, while selling, general and administrative costs collapsed to $7.6 million from $39.6 million. The company attributes the SG&A reduction to a strategic shift away from marketing its legacy product and a broader focus on high‑margin pipeline development. These disciplined cost controls, combined with the one‑time licensing inflow, explain why the loss margin improved despite the revenue surge.
Cash, cash equivalents and restricted cash stood at $145 million at September 30, a $93 million decline from the $238 million balance at the end of 2024. The company maintains a runway that comfortably covers its operating plan for the next 12 months, and management indicated no immediate need for additional financing. The liquidity position, while lower, remains robust enough to support ongoing R&D and potential future milestone payments from Novo Nordisk.
Pipeline progress was highlighted as a key growth driver. IND‑enabling studies for the obesity candidate LX9851 were completed and submitted to Novo Nordisk, positioning the partnership for future milestone payments. The SONATA‑HCM Phase 3 trial of sotagliflozin in hypertrophic cardiomyopathy reached site initiation, with enrollment on track for 2026. An FDA End‑of‑Phase 2 meeting for the neuropathic‑pain candidate pilavapadin is scheduled for year‑end, and additional data supporting a potential resubmission of Zynquista for type 1 diabetes with chronic kidney disease has been filed with the FDA.
CEO Mike Exton emphasized that the quarter “represents a pivotal moment” as the company balances cost discipline with strategic investments. “Our licensing partnership with Novo Nordisk has provided a significant cash infusion and validates our platform, while our pipeline milestones reinforce the long‑term value we are building,” he said. CFO Scott Coiante added that the company’s “optimized operational spend and focus on high‑return programs” have positioned Lexicon for a stronger financial footing moving forward.
Analysts reacted positively to the results, noting that the revenue and EPS beats were driven by the licensing deal and disciplined cost management. The market’s favorable response reflects confidence in Lexicon’s ability to convert its platform into commercial success while maintaining a lean operating model.
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