LXRX - Lexicon adds 15% as Piper Sandler sees blockbuster potential for key assets

The shares of Woodlands, Texas-based biotech Lexicon Pharmaceuticals ( NASDAQ: LXRX ) gained ~15% after Piper Sandler launched its coverage with an Overweight recommendation citing the “blockbuster potential” for two of its assets.

The analyst Yasmeen Rahimi points to the company’s oral drug candidate Sotagliflozin which has undergone Phase 3 clinical trials for heart failure and type 1 diabetes.

The analyst projects a $22.1B market opportunity for Sotagliflozin, which is currently under FDA review for heart failure with an action date expected in May 2023.

In addition, Rahimi highlights LX9211, Lexicon’s ( LXRX ) candidate for painful diabetic neuropathy, arguing that the Phase 2 asset represents a compelling opportunity for non-dilutive financing.

In Q2 2022, the company enrolled patients in a Phase 2 proof-of-concept study for LX9211 for another pain indication called post-herpetic neuralgia, expecting to release its top-line results later this year.

Piper issues a $10 per share target on Lexicon ( LXRX ), which stands ~38% lower than the current average price target for the stock on Wall Street.

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