Lexicon Pharmaceuticals Inc. has terminated a collaboration with France's Sanofi for the development of diabetes treatments, settling the matter for an up-front payment of $208 million.
Woodlands, Texas-based Lexicon will receive another $52 million from Sanofi within 12 months and will regain all rights to develop and commercialize Zynquista for the treatment of type 1 and type 2 diabetes. Zynquista is a dual inhibitor that blocks two proteins responsible for glucose regulation.
Sanofi said it was ending the collaboration in July after the experimental diabetes drug failed to achieve all the goals set out in three late-stage clinical trials.
Both companies had difficulty pushing Zynquista past regulatory review. An outside expert panel of the U.S. Food and Drug Administration flagged serious adverse events associated with the therapy in January, with the agency rejecting the application for Zynquista in March. The European Commission, meanwhile, approved the drug as an add-on therapy for adults with type 1 diabetes in April.
Despite the setback, Lexicon plans to continue with its clinical trial programs and to seek regulatory approvals for the drug. The company's CEO Lonnel Coats said in a Sept. 10 statement that phase 3 clinical trial data is expected on Zynquista in the next few months, and further data is expected over a longer term regarding the therapy's benefits to cardiovascular and kidney health.
Lexicon's stock price was up 21.1% to $1.72 as of 4 p.m. ET at market close on Sept. 10, while Sanofi's shares remained stable.
