Lexicon Pharmaceuticals (LXRX) PT Raised to $6 at Leerink Partners

Leerink Partners analyst Roanna Ruiz raised the price target on Lexicon Pharmaceuticals (NASDAQ: LXRX) to $6.00 (from $5.00) while maintaining a Outperform rating.

The analyst comments "Bottom Line: We see Lexicon’s (LXRX) exclusive licensing agreement with Viatris [VTRS, Not Rated, LINK] for sotagliflozin (sota) in all rest-of world (RoW) markets outside of US/Europe as positive external validation from a large biopharma for sota’s future market opportunity across its multiple indications, and it provides valuable royalties & milestones that could be re-invested into the portfolio. This deal also represents a solid strategic move by LXRX that should: a) reinforce their position in the cardiometabolic space, b) clarify their global commercialization approach, and c) bolster their long term revenue outlook. We believe LXRX remains undervalued at current levels, as investors seem conservative in their valuation of LXRX’s pipeline programs that span multiple high unmet need indications like Type 1 diabetes with chronic kidney disease (T1D +CKD), hypertrophic cardiomyopathy (HCM), diabetic peripheral neuropathic pain, and obesity (our initiation HERE). Up next, key momentum drivers that could impact the stock include: a) if Inpefa heart failure (HF) sales potentially inflect into 2025, and b) if Zynquista’s FDA advisory committee meeting on Oct 31, 2024, results in a net positive outcome, providing readthrough to Zynquista’s potential US approval in T1D+CKD by the Dec 20, 2024, PDUFA. We updated our model to reflect the deal terms under the Viatris agreement (details below), which increased our PT to $6 (from $5). Reit. OP."

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