In a research report issued Friday, Needham analyst Alan Carr reiterated a Buy rating on shares of Lexicon Pharmaceuticals, Inc. (NASDAQ:LXRX) with a price target of $21, after the drug maker reported top-line results from its first Phase 3 trial of Sotagliflozin in Type 1 Diabetes. Lexicon shares reacted to the news, jumping nearly 18% to $18.01, as of this writing.
Carr commented, “The reductions in A1c reported today are clinically meaningful in the context of a well-controlled T1D patient population and we believe larger reductions can be expected in a real-world population. There appears to be a reduction in risk of severe hypoglycemia w/sotagliflozin, a significant and important benefit. Decreases in A1c are generally associated with an increase in risk of hypoglycemia, the primary safety concern of T1D patients.”
“However, we note increased reports of several safety concerns that have been linked to SGLT2 inhibitors, including euglycemic DKA and genital infections. These effects were dose-dependent and raise the issue of whether 200mg may be more attractive than 400mg to regulators. We reiterate BUY, w/expectation that dual SGLT1/SGLT2 inhibitor sotagliflozin will have a profile at least comparable to SGLT2 inhibitors w/ potential for modest or moderate safety/efficacy advantages,” the analyst continued.
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Alan Carr has a yearly average return of 10.9% and a 47% success rate. Carr has a 26.8% average return when recommending LXRX, and is ranked #247 out of 4147 analysts.
Out of the 5 analysts polled by TipRanks, 3 rate Lexicon Pharmaceuticals stock a Buy, while 2 rate the stock a Hold. With a return potential of 25%, the stock’s consensus target price stands at $22.25.