Three proved to be the charm for Lexicon Pharmaceuticals (NASDAQ:LXRX) after it reported its third set of positive phase III data for its novel SGLT1/2 drug sotagliflozin in type 1 diabetes.
The results reported at the American Diabetes Association conference not only keep it and partner Sanofi (NYSE:SNY) on track for a first-quarter filing next year, but the continued efficacy and safety data could lend support for the two groups' further efforts in the crowded type 2 diabetes field.
Shares in Lexicon, which has US co-promotion rights to sotagliflozin, rose 7% on the news on Friday.
In the inTandem3 study 1,402 patients with type 1 diabetes with A1C levels of 7-11% were randomised to receive either once-daily sotagliflozin or placebo for 24 weeks. A significant number of patients taking sotagliflozin saw their A1C levels fall below 7%, the point recommended to keep adequate control of blood sugar.
More importantly for Lexicon and Sanofi, the relatively clean safety profile seen in previous trials was replicated in inTandem3, with hypoglycaemia at similar levels to placebo. However, there was a slightly higher incidence of the equally serious diabetic ketoacidosis.
Sotagliflozin is currently the only SGLT1/2 inhibitor in late-stage trials and Lexicon believes that the dual action of the product, glucose excretion and slowing glucose absorption in the gut, should result in better blood-sugar control. The drug has also so far avoided amputations, which is significant as analysts had speculated that the increased amputation risk with Invokana could have been due to inadvertent SGLT1 inhibition (Amputation risk adds another cut to Invokana, May 30, 2017).
The path less traveled
It is just as well that Lexicon is targeting type 1 diabetes, giving the existing competition in the type 2 SGLT2 space from the likes of Farxiga, Jardiance and Invokana. Recently many incumbents in the type 2 arena have seen the net prices paid for their products come under severe pressure as payers have taken advantage of the number of competing drugs, forcing them to gain market share through price discounts.
As such, potentially being the only oral type 1 product on the market could not only help sotagliflozin gain approval, but guarantee it wide formulary access.
How it will fare as a late-comer in the already crowded type 2 market is less clear, but some analysts are hoping that the drug's so far clean safety profile and trial designs that have focused on sicker patients will help it carve out a niche among patients with kidney impairments who cannot take other oral glucose lowering products.
According to consensus forecasts from EvaluatePharma sotagliflozin should have sales of $1.16bn by 2022. As part of the 2015 deal Lexicon signed with Sanofi that saw it bank a $300m upfront fee, Lexicon is set to receive US royalties and co-promotion rights to sotagliflozin in type 1 diabetes, but is responsible for development costs. So the continued positive data churn from sotagliflozin should bring yet more reassurance to Lexicon investors.
For partner Sanofi, its late buy into the SGLT2 market might turn out to be the successful low-risk gateway it so desperately needed.