Cowen analyst Chris Shibutani remains sidelined, but optimistic on Lexicon Pharmaceuticals (NASDAQ:LXRX) after the firm released a positive top-line readout from InTandem2, the second of its three pivotal Phase III trials for SGLT1/2 inhibitor Sotagliflozin in Type I Diabetes. The firm’s pipeline drug successful reached its primary efficacy endpoint of improvement.
In reaction, the analyst reiterates a Market Perform rating on LXRX without listing a price target.
This trial follows the first Phase III study, InTandem1, which also proved to be positive, with top-line data released in September. Whereas the first trial was conducted in the U.S., InTandem2 was conducted in both the EU as well as in Israel.
Considering that investors have kept their eyes peeled to safety results as a “primary focus,” Shibutani underscores the rate of Serious Adverse Events (SAEs) for the 200 mg and 400 mg doses as a “noteworthy positive,” as they “align quite closely” with the rate of the placebo group.
The analyst adds, “Similarly, it is favorable/reassuring that this was also the case with regard to treatment related discontinuations which were similar to placebo.” Furthermore, the only two deaths reported in this trial both stem from the placebo arm.
Secondly, Shibutani notes, “Severe hypoglycemia has been highlighted by management as the primary safety concern with T1D patients. It is encouraging to see that the patients across treatment arms had a similar level of hypoglycemia events compared to the control arm.”
Looking ahead, “We are keen to continue to observe how this parameter continues to evolve with additional upcoming data sets – in particular from this trial’s 52 week results, and the larger […] safety study – which importantly, will be more reflective of ‘real world’ clinical management conditions, in that an ‘optimized insulin’ regimen […] is not part of the protocol,” Shibutani contends.
Once LXRX management presents full details on the rate of euglycemic DKA, the analyst believes this will be a critical metric in assessing the full DKA safety profile. Overall, the analyst is encouraged by these successful results and believes the data exhibit “a promising overall profile.
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, four-star analyst Chris Shibutani has a success rate of 61% and is ranked at #1,075 out of 4,289 analysts.
Shibutani has a yearly average return of 5.9% and when recommending LXRX, he earns 0.0% in average profits on the stock.
TipRanks analytics demonstrate LXRX as a Strong Buy. Based on 5 analysts polled by TipRanks in the last 3 months, 4 rate a Buy on LXRX stock while 1 maintains a Hold. The 12-month average price target stands at $23.00, marking a 57% upside from where the shares last closed.
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