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Lexicon Pharmaceuticals Inc (LXRX -0.32%)
Q3Â 2020 Earnings Call
Oct 29, 2020, 8:00 a.m. ET
Contents:
- Prepared Remarks
- Questions and Answers
- Call Participants
Prepared Remarks:
Operator
Good morning, my name is Julianne and I will be your conference operator today. At this time, I would like to welcome everyone to the Lexicon Pharmaceuticals' 3rd Quarter 2020 Financial Results Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. If you would like to ask a question during this time [Operator Instruction]. I would now like to hand the conference over to your first speaker today, Chas Schultz. You may begin.
Chas Schultz -- Executive Director of Corporate Communications & Patient Advocacy
Thank you, Julianne. Good morning and welcome to the Lexicon Pharmaceuticals third quarter 2020 financial results and clinical update conference call. Joining me today are Lonnel Coats, Lexicon's President and Chief Executive Officer; Dr. Praveen Tyle, Lexicon's Executive Vice President of Research and Development; and Jeff Wade, Lexicon's Executive Vice President of Corporate and Administrative Affairs and Chief Financial Officer. Earlier today, Lexicon issued a press release announcing our financial results for the third quarter of 2020, which is available on our website at www.lexpharma.com and through our SEC filings. A webcast of this call, along with a slide presentation is available on our website. During this call, we will review the information provided in the release, provide an update on our clinical programs, and then use the remainder of our call -- of our time to answer your questions. Before we begin, let me remind you that we will be making forward-looking statements, including the statements relating to the safety, efficacy, and the therapeutic and commercial potential of LX9211, sotagliflozin, and our other potential drug candidates. These statements may include characterizations of their expected timing and results of clinical trials of LX9211, sotagliflozin, and other drug candidates; and their regulatory status and market opportunity for those programs.
This call may also contain forward-looking statements relating to our growth and future operating results, discovery and development of our drug candidates, strategic alliances and intellectual property, as well as other matters that are not historical facts or information. Various risks may cause our actual results to differ materially from those expressed or implied in such forward-looking statements. These risks include uncertainties related to the timing and results of clinical trials and preclinical studies of LX9211, sotagliflozin, and our other drug candidates; our dependence upon strategic alliances and other third-party relationships; our ability to obtain patent protections for our discoveries; limitations imposed by patents owned or controlled by third parties; and the requirements of substantial funding to conduct our research and development activities. For a list and a description of the risks and uncertainties that we face, please see the reports we have filed with the Securities and Exchange Commission.
I will now turn the call over to Lonnel Coats. Thank you, Chas. Good morning everyone and thank you for joining us on the call. We welcome the opportunity to discuss a pivotal quarter for Lexicon in which we shifted our focus to LX9211 and our other scientific assets and research and development. During the third quarter, we completed the sale of XERMELO and related assets to TerSera Therapeutics. This sale allowed us to strengthen our balance sheet by repaying our $150 million term loan in full. We also exchanged $75.8 million in principal amount of our convertible notes for cash and common stock and have retired more than 90% of our outstanding debt in total. We are in a very good position to focus our time and efforts on the advancement of LX9211, which is a program we have been excited about for a number of years. Praveen will share more about this program and the potential we see for it to become a new treatment option for the millions of people suffering from neuropathic pain. Starting in the fourth quarter, Lexicon will be operating as a much more streamlined and focused company. We expect our cash burn to be dramatically lower moving forward into 2021 and we will be laser focused on advancing LX9211 through to two Phase two clinical trials in diabetic peripheral neuropathic pain and post-herpetic neuralgia. Jeff will delve into the financials more deeply, including our outlook on expected spend moving forward. I feel confident that with the de-levering of our balance sheet and a substantial reduction in our expected spend, we are in a much better position to advance our science and increase the opportunity from values to flow through to our stakeholders. On Slide four, I'd like to take a quick moment and remind everyone that sotagliflozin remains an important asset in our science and development pipeline. This is a drug that we wholly owned and continue to believe has the potential to become a very important new treatment for the many people living with type one diabetes. Sotagliflozin has shown in a Phase three program involving approximately 3,000 patients to be effective as an adjunct to insulin in reducing A1C and achieving other secondary efficacy endpoints, which led to an approval in Europe for type one diabetes last year. We continue to believe that the diabetic ketoacidosis risk observed in a Phase three program is manageable and we will continue to seek approval in the United States. At this point, we feel there is an opportunity to initiate the next phase of our strategy and reengage with the FDA. It is important that we gain alignment with the agency on a clear pathway forward in type one diabetes and we plan to start that work this quarter. We will be providing updates to you in the coming months as we make progress toward this outcome. We're also completing an early closeout of SCORED and SOLOIST, two outcomes studies of sotagliflozin with primary endpoints evaluating a composite of total cardiovascular death, hospitalization for heart failure, and urgent visits for heart failure. The outcomes of those trials will be presented as part of a late breaker session titled late-breaking science at the upcoming American Heart Association Scientific Session on November 16 at 8:00 PM Eastern time, so set your calendars. With that, I would like to invite Praveen to update you on our important pipeline asset, 9211. Dr. Tyle?
Praveen Tyle, PH.D. -- Executive Vice President of Research and Development
Thank you, Lonnel. LX9211 is a potent, orally delivered, selective small molecule inhibitor of AP2-associated kinase, which I'll reference as AAK1, which is a pathway we believe may have utility in reducing neuropathic pain while avoiding the addictive downsides of the opioid pathways. LX9211 was discovered by scientists working within our drug discovery alliance with Bristol-Myers Squibb and we now wholly own all rights to LX9211 as well as any additional compounds acting through AAK1 pathway that we may develop. As you can see on this chart, we have already initiated a Phase two proof-of-concept study in diabetic peripheral neuropathic pain and we plan to initiate an additional Phase two proof-of-concept study in post-herpetic neuralgia by the end of this year. We expect that both of these Phase two studies will readout by the end of next year. Neuropathic pain affects a large portion of the population within a worldwide market of approximately $6.4 billion in estimated sales expected for 2020. The worldwide market is expected to grow at over 13% a year to $13.2 billion by 2026.
There is estimated to be a prevalence of approximately 12 million people worldwide suffering from DPNP and 600,000 people suffering from PHN in 2026. Despite neuropathic pain affecting millions of people, there remains a high level of unmet need for those suffering from that condition. The current approved therapies are limited by a lack of efficacy, compounded by disruptive side effects. As a result, many people turn to opioids to experience some level of relief, which of course carry their own risks of potential abuse and addiction. We feel that LX9211 through its inhibition of AAK1 independent from the opioid pathway has the potential to overcome many of the shortcomings of current therapies and could become a welcome new innovation for those suffering from neuropathic pain on a routine basis. So let's talk a little bit about why we are so interested in AAK1 as an innovative pathway for neuropathic pain. The discovery of AAK1 as a potential target for neuropathic pain occurred in the course of our multi-year discovery and research program we conducted about a decade ago called the Genome5000 project. In that initiative, we studied the phenotypes of approximately 5,000 different knockout mouse lines and identified the AAK1 knockout mice as exhibiting the most compelling phenotype for neuropathic pain among all the genes we studied here at Lexicon. Our preclinical data for LX9211 has demonstrated excellent central nervous system penetration and reductions in pain behavior in animal models of neuropathic pain. I will take you through some of our preclinical findings for LX9211 in these animal models shortly, but what is very important is that we have conducted several preclinical tests to confirm LX9211s independence from the opioid pathway and so far we have found no concerns around addictive potential with LX9211. We have conducted single and multiple ascending dose Phase one clinical studies in healthy volunteers to study the safety, tolerability, and pharmacokinetics of LX9211. These studies support the preclinical profile we had obtained in our laboratories. LX9211 was well tolerated with dose-proportional pharmacokinetics that were supportive of once-daily dosing. There were no drug-related serious adverse events and the most common adverse events were transient, headaches and dizziness.
Overall, we feel LX9211 represents an innovative potential approach to treat neuropathic pain without the addictive potential of many of the current therapies and treatments. Let me show you some of the preclinical data supporting our view that LX9211 may be beneficial for people suffering from diabetic peripheral neuropathic pain and post-herpetic neuralgia. With diabetic peripheral neuropathic pain, people living with diabetes often develop nerve damage, which cause painful, debilitating symptoms, most often in their legs and feet. It is estimated that 60% to 70% of people with diabetes will develop peripheral neuropathy at some point in their life. On this slide, you will see the effect of LX9211 in the gold-standard diabetic peripheral neuropathic pain models in rats, also called STZ-model. In this model, streptozotocin, STZ is used to induce diabetes in rats and then tests are performed to evaluate the rats' sensitivity to mechanical allodynia, which is a condition associated with diabetes where even slight touch can cause a painful sensation. This graph is book-ended with the brown and purple lines. The brown line represents the rats in which diabetes was induced, while the purple line represents the controlled rats without diabetes and with normal sensitivity to touch. The rats along the brown line are feeling the full effect of neuropathic pain from their diabetes, and they feel pain with any type of touch as shown by 0% inhibition of mechanical allodynia. The rats along the purple line are not feeling any effect of neuropathic pain or sensitivity to touch as shown by 100% inhibition of mechanical allodynia. The lines in between these two extremes show the effect of LX9211 on the diabetic rat.
As you can see, there is a clear dose response to LX9211 that enables these diabetic rats to experience a statistically higher degree of touch without pain at the one and three milligram per kilogram levels. By way of comparison in the same experiment, gabapentin was administered at 100 milligram per kilogram and resulted in a similar response as the one and three milligram per kilogram levels of LX9211. So we were able to achieve a similar level of efficacy at a much lower dose with LX9211. More importantly, at this level of dosing, we saw no motor impairment in the rats and no impairment of performance in a cognition model, which are the two significant side effects of gabapentin. We have advanced LX9211 into a Phase two proof-of-concept trial in DPNP. This trial is a double-blind, placebo-controlled parallel-group study that is expected to enroll approximately 300 patients from 30 US sites. Patients will be randomized to one of the three arms, placebo, 100 milligram initial dose followed by 10 milligram maintenance dose and 200 milligram initial dose followed by 20 milligram maintenance dose of LX9211 with a 1-1-1 randomization.
The primary endpoint has changed from baseline to week six in average daily pain score, a very standard symptom measurement tool used in most of the neuropathic pain trials. The first patient was dosed during third quarter of this year and we expect results in the fourth quarter of 2021. We have taken steps to mitigate the strong placebo effect that is characteristic of studies in diabetic peripheral neuropathy pain, including studying a large number of patients over a long treatment period, conducting the trial exclusively in United States and otherwise designing the trial with the potential placebo effect in mind. Now let's turn our attention to the second indication, post-herpetic neuralgia. Post-herpetic neuralgia is the most common complication of shingles. Individuals who contract shingles will often be left with nerve damage that causes burning sharp pain long after the rash and blisters of shingles disappear. People of an older age and people with greater acute pain, greater rash severity, or on immunosuppressive therapies are more likely to develop PHN. This condition can last months to years. On this slide, you will see the effect of LX9211 in post-herpetic neuralgia model in rats. In this model, varicella zoster, which is the virus that causes shingles, is introduced to the rats. Rats are nocturnal by nature and prefer to stay in the dark, usually only entering the light when under duress. In this model, we looked at the time that rats spend in dark versus the light. After placing the rat in the test chamber, the rat was stimulated on the face with a filament every 15 seconds. We measured the time rats spend in the dark over five-minute intervals or 300 seconds, the rats represented by the white circles dotted line have not been administered the virus and therefore act normally. As you can see in both graphs, they spend nearly all their time in the dark.
The rats represented by blue circles dotted line had been administered the virus and therefore are in pain from shingles and spend large amounts of time in the light. On the left graph, we tested the effect on the rats of a single dose of our drug LX9211, seven days post virus infection. As you can see, the rats which were treated with our drug LX9211 acted similarly to the rats that were not infected. On the right graph, we tested the effect on rats of seven daily doses of LX9211, 14 days post virus infection. In this case, the rats which were treated with our drug LX9211 acted nearly identical to the rats that were not infected and you can see great separation from the untreated rats. By way of comparisons, we ran the same test head-to-head with gabapentin at 100 milligram per kilogram. Once again, we have the single doses of LX9211 and gabapentin on the left and multiple doses of LX9211 and gabapentin on the right. The gabapentin single-dose resulted in a similar response as a single dose of 30 milligram per kilogram of LX9211. Both drugs provided a statistically significant improvement in time in the dark as compared to the untreated rats. In the multiple dose administration involving seven doses of our drug LX9211 and gabapentin, we saw further separation.
When comparing gabapentin treated rats to LX9211 treated rats, the pain response was significantly better in our LX9211 treated rats. With LX9211, we were able to achieve a similar or potentially superior level of efficacy at both single dose and multiple doses and using a much lower dose than gabapentin. We are very encouraged by the preclinical data and we will be initiating an additional Phase two clinical study of LX9211 in post-herpetic neuralgia. In general, PHN has a lower placebo effect and outcomes are more straightforward. The PHN trial will be a small pilot study with two arms only, placebo versus 200 milligram initial dose followed by 20 milligram maintenance dose daily. We plan to enroll approximately 74 patients in approximately 30 sites globally. The primary endpoint has also changed from baseline to week six average daily pain score and we expect the first patient to be dosed later this year. Overall, we feel that our drug LX9211 has the potential to show significant benefits for people suffering from DPNP and PHN and we look forward to completing and reporting results from both of these studies toward the end of next year.
With that, I would like to turn the call over to Jeff Wade to discuss our financial results. Jeff?
Jeffrey L. Wade, J.D. -- Executive Vice President, Corporate and Administrative Affairs and Chief Financial Officer
Thank you, Praveen. To begin, I will discuss key aspects of our third quarter financials. More financial details can be found in the press release that we issued earlier today and then our upcoming 10-Q SEC filing. As indicated in our press release, we had net product revenues of $6.5 million for the third quarter, reflecting product sales prior to the completion of the sale of XERMELO and related assets to TerSera Therapeutics on September 8, 2020. This compares to net product revenues of $8.4 million from the prior year quarter, which represented a full three months of product sales. The prior year quarter also reflected the collaborative revenues of $260 million from the termination of the alliance with Sanofi and recognition of the remaining amount of $23.5 million allocated to performance obligations from the initial agreement with Sanofi. Research and development expenses for the third quarter increased to $40.1 million from $26.7 million for the corresponding period in 2019, primarily due to increases in the external clinical development costs relating to sotagliflozin, subsequent to the termination of the Sanofi alliance. Selling, general, and administrative expenses for the third quarter decreased to $12 million from $13.9 million for the corresponding period in 2019. Our R&D and G&A expenses for the quarter included severance expenses associated with personnel changes relating to the sale of XERMELO and refocusing of our operations around our research and development stage assets. Finally, we recognized a gain of $132.8 million during the quarter from the sale of XERMELO and related assets to TerSera. In total, we had net income for the third quarter of $82.6 million or $0.71 per diluted share, as compared to a net income of $226.1 million or $1.95 per diluted share in the corresponding period in 2019. Our net income for the third quarter of 2020 and 2019 reflected non-cash stock-based compensation expense of 1.9 and $3.6 million respectively. We ended the third quarter of 2020 with $111.4 million in cash in short-term investments as compared to $271.7 million as of December 31, 2019. We eliminated most of our debt during the third quarter, reducing our overall indebtedness from $245.3 million at June 30 to $20.3 million at September 30 and we eliminated an additional $8.8 million in convertible debt in early October. During the third quarter, we realigned the company to focus our efforts moving forward on LX9211 and other research activities. This resulted in our headcount and operating expenses being reduced moving forward. We now expect our total full year operating expenses for 2020 to be $225 million to $231 million, down from $230 million $250 million. We expect fourth quarter R&D expenses to be in the range of $22 million to $27 million, which would put our full 7year 2020 R&D expenses in a range of $175 million to $180 million with the top end of the range down from the $185 million reflected in our prior guidance. Notably our anticipated fourth quarter R&D expenses will be substantially less than the $40.1 million we recorded in the third quarter, the results of our continued wind down at the sotagliflozin type two diabetes program and outcome studies, which will be substantially complete in the fourth quarter. We expect fourth quarter SG&A expenses to be in the range of $6 million to $7 million, which would put our full year 2020 SG&A expenses in a range of $47 million to $48 million, down from our prior guidance of $55 million to $65 million. We expect non-cash expenses to be approximately $20 million of our total operating expenses. Overall, we expect that our cash will be sufficient to fund our operations for at least the next 12 months.
I will now turn the call back to Lonnel.
Lonnel Coats -- President and Chief Executive Officer and Director
Thank you, Jeff. So let me summarize, I think for us as a company we're pretty excited about LX9211, it's been a compound that I've been excited about from the time I started here and we negotiated the wholly owned rights from our alliance with BMS -- our discovery alliance with BMS. To have this compound. We've now cleared away to focus on this compound and accelerate it through development. I truly believe it will be a gamechanger for us should we be successful, and therefore we have now put ourselves in a position to focus on it. For the remainder of 2020, we expect to initiate the Phase two studies in post-herpetic neuralgia as well as DPNP, and as noted before we expect to report the Phase two study results of both of these studies by the end of next year. And then once again, I will remind everybody on November 16 at 8:00 PM Eastern time, we expect the presentation of the data from the sotagliflozin SOLOIST and SCORED Phase three studies at the American Heart Association Scientific Sessions. With that, I will stop there and turn the call over to the operator for Q&;A.
Questions and Answers:
Operator
Thank you ladies and gentlemen. We will now begin the question-and-answer session. [Operator Instructions]. Your first question comes from the line of Yigal Nochomovitz from Citigroup. Your line is open, please ask your question.
Yigal Dov Nochomovitz -- Citigroup Inc. -- Analyst
Hi great. Thanks very much for taking the question. I think you Praveen, you mentioned the placebo effect with some of the neuropathic pain trials. I'm wondering if you could just go into a little bit more detail please in terms of the specific steps that you're taking both for the diabetic peripheral neuropathic pain study, as well as the post-herpetic neuralgia study? What steps you're taking in order to mitigate the placebo response in both those studies. Thanks.
Praveen Tyle, PH.D. -- Executive Vice President of Research and Development
Thanks, Yigal for your question, a very relevant question, actually, we took a little bit of time in order to figure out how we wanted to design this protocol in order to mitigate this placebo effect and we looked at the other studies which have been done in the area, why they have failed and all that. So, what we are basically -- we have done is, we are mitigated by making sure that we are having a large number of patients in each of the randomization cohorts. So, we have a 1-1-1 randomization. And like I mentioned, for DPNP we have 300 patients, so we will have approximately 100 patients per hour. We also have a very good amount of efficacy period. So, most of those other studies have failed because they have not studied the efficacy for up to six weeks and we are going to study up to six weeks with that placebo effect in mind. We've also trained our investigators to look for this placebo effect, and we are making sure that these patients will be enrolled, are filling out their diary on a daily basis to ensure compliance and if they have a high placebo effect, we are evaluating whether they should be in the study or not in the study. So, we are basically taking care of placebo effect on multiple levels for -- and that is all for diabetic peripheral neuropathy pain, Yigal. For PHN, it's a more homogeneous disease and the practice of treating PHN is widely accepted worldwide, so we are a little less concerned about the placebo effect of PHN.
Yigal Dov Nochomovitz -- Citigroup Inc. -- Analyst
Okay, got it. Thank you. And then just one question for Jeff. I mean, you extinguished almost all of the debt, over 90%, any particular reason you just didn't go and just extinguish all of it, you have a small amount left on the balance sheet.
Jeffrey L. Wade, J.D. -- Executive Vice President, Corporate and Administrative Affairs and Chief Financial Officer
Yes. Well in that -- as of early October, we have less than $12 million outstanding. So it's an agreed upon exchange, so we had to get to an agreement and we did what we thought was optimal. Our goal was to reduce the debt so that it wouldn't be an obstacle going forward and we think that at the level that it is now, we've achieved that objective.
Yigal Dov Nochomovitz -- Citigroup Inc. -- Analyst
Okay, great. Thanks. And then just one more question on sotagliflozin. Can you spend a little more time just talking about some of the details in terms of the plan to seek approval in the U.S.? What -- are you going to conduct new studies? Are there other analyses of the existing studies that you can do to help the FDA better understand and put the DKA risk in perspective? And what is the strategy now in terms of trying to seek approval in the U.S. for type one diabetes?
Lonnel Coats -- President and Chief Executive Officer and Director
Yigal, thank you for the question. I think we watched very carefully what the other players were going to do, that's in the space, and I think as we can clearly see, particularly given that COVID-19 struck most have moved away from type one and have chosen not to go forward. For us, we feel very passionate about -- the drug has shown extremely good benefit, there is no question, the benefit is not questioned about the drug in type 1. We still need to be able to get clear guidance from the FDA on what's the best way to go forward in terms of managing risk of DKA. It is the position of the company, we think we have done that, and we think we need to have more dialogue about it in different ways in different forums. And it'll become much more transparent I think as we go forward into the fourth quarter going into next year, exactly how we're going to approach the agency. But right now, I think we need more clarity from the agency on best -- how best we go forward and being able to manage that risk in a very organized way. To date, we have not gotten that clarity from the FDA, and I believe they owe it to the patient population as we owe it to the patient population to continue this dialogue. So, we have not given up on it, we took a break just because I think COVID-19 caused all of us to reprioritize things, but we certainly have not given up on it and we will approach it again. And we'll keep you posted as we have those -- have dialogue with the agency.
Yigal Dov Nochomovitz -- Citigroup Inc. -- Analyst
Right, OK, thank you very much.
Lonnel Coats -- President and Chief Executive Officer and Director
You bet.
Operator
Thank you, your next question comes from the line of Kevin Kedra from G.Research. Your line is open.
Kevin Kedra -- G. Research, LLC -- Analyst
Hi, thanks for taking the questions. Maybe to piggyback on that last one. You talked about how some of the competitors have moved away from the type one indication. Yet they're still out there, they're on the mark with type 2, and there's obviously a lot of experience out there with their drugs. Are you concerned at all that if you do the work to get the FDA aligned on a pathway to type one that basically you guys are going to be doing the legwork for the entire class, and there's still an opportunity once you guys put in the work for others to just kind of quickly piggyback off your pathway and quickly bring their products to market as well, based on the data that they have.
Lonnel Coats -- President and Chief Executive Officer and Director
Yeah, it's a great question and certainly it's a possibility, but I think the way we have one, tried to appropriately time this; and two, we are in a unique position where we have done most of the work and we have created I think the greatest amount of data to be able to have an approved indication versus when I say the others have not moved forward. In the absence of an approved indication, it will be very difficult, particularly given you will be managing a safety risk. So, I think if we would be successful and we move in this direction and we do get an indication, we would have done the work that would be necessary to have an approved product, where you have clear mandates around how to manage that product in a safe way. Unless the other companies choose to pivot at this point and do the same work, I do not see them coming on the same pathway as we are. So, I do think it's a unique opportunity for us given our position versus theirs. So, I will leave it at that.
Kevin Kedra -- G. Research, LLC -- Analyst
All right, great. As far as the new discovery pipeline, you guys have obviously shifted to being more of a discovery company at this point. Should we expect to see any potential new compounds move into the clinic or an IND stage in 2021 or should we really be thinking about 2021 being just 9211 and maybe any movement on type one in for sotagliflozin?
Lonnel Coats -- President and Chief Executive Officer and Director
Yes, that's a great question. I think we have an opportunity to move another asset into IND-enabling studies in 2021. So, I would say, stay tuned when that work is being done, but 2021 really will be about two compounds for us. One, sotagliflozin, I think you'll clearly see we're not abandoning that, I think it's an opportunity to accelerate some of the work that we're doing there, but it's a low cost effort at this time. And secondly, and most importantly, is really to spend as much of our time as we can to accelerate 9211 because as I've said, I've always believed it has the greatest potential to transform the company and we need to know that sooner than later. So, that's where most of our efforts will be placed in 2021. But we will continue to advance our discovery engine and look at ways in which we can put products into the clinic beyond 2021, particularly going into 2022.
Kevin Kedra -- G. Research, LLC -- Analyst
Great. And let me squeeze one last one in, Jeff, you gave us some color on how to think about Q4 spending. Should we think of those as baseline levels to work with going into 2021? Are they still -- obviously, you guys are going to be ramping up two Phase two studies, but other than that, are there other moving parts within the Q4 numbers we should think about when we start looking into 2021?
Jeffrey L. Wade, J.D. -- Executive Vice President, Corporate and Administrative Affairs and Chief Financial Officer
I would just say that the 2021 fourth quarter R&D spend is still going to be higher than it will be in -- I mean, sorry, 2020 fourth quarter R&D spend will still be higher than it will be in 2021, because we're still winding down some of the activities in the sotagliflozin type two diabetes and outcome studies in this quarter. And that will be largely, almost entirely complete by the end of this quarter. So, we will have some lower R&D spend next year compared to this year.
Kevin Kedra -- G. Research, LLC -- Analyst
Great, thanks.
Operator
Thank you, again in order to ask a question please press star and number one on your telephone keypad. Next question from Stephen Willey from Stifel. Your line is open.
Stephen Douglas Willey -- Stifel, Nicolaus & Company -- Analyst
Good morning, guys. Thanks for taking the question. I was maybe just wondering if you could speak a little bit to the amount of wiggle room that you've kind of provided into the year-end 2021 Phase two data guidance for both of the Phase 2s with respect to just the patient enrollment. I know that this was a trial. I think the DPN trial was kind of slowed a little bit due to COVID. And I would imagine that's an -- those are both indications, which are probably a bit more sensitive to patient visits than perhaps some others. So, maybe just talk a little bit about your confidence in the guidelines you provided with respect to anticipated pace of patient enrollment and how you think that may be impacted just over the coming months?
Lonnel Coats -- President and Chief Executive Officer and Director
Yes, Steve, I appreciate the question. Yes, I think we made it clear that we did slow down on enrollment in our efforts when COVID-19 hit in March. Otherwise, the program I think would be much further along and we are having to think through what that's going to look like, should we have another challenge around COVID-19? So, there's a little bit of wiggle room in there, but not a whole lot. Our objective is to put all of our resources and efforts into getting this enrollment up to speed and in a position where we can overcome any challenge or risks of COVID-19. So, that's kind of built in at this point. With that being said, it's anybody's game with COVID-19 and what may happen in the near-term future.
Stephen Douglas Willey -- Stifel, Nicolaus & Company -- Analyst
Understood. I know that these are blinded trials, but would there be an opportunity for you guys to maybe structure in some kind of interim analysis for whatever reason, we're approaching the end of next year and you don't yet have the amount of patient data to formally close the trial?
Lonnel Coats -- President and Chief Executive Officer and Director
I'll simply say that we're giving thoughts to all the ways in which we can provide information around this program as we're confident about it earlier than later. So, I would categorize it that way.
Stephen Douglas Willey -- Stifel, Nicolaus & Company -- Analyst
Okay. Thanks for taking the question.
Lonnel Coats -- President and Chief Executive Officer and Director
Yeah.
Operator
Thank you again, in order to ask a question please press one on your telephone keypad. There are no further questions at this time, please continue.
Lonnel Coats -- President and Chief Executive Officer and Director
Well, let me thank everyone for joining us this morning. I think it's been a remarkable third quarter where we have moved back to our roots of being a very strong scientific company in discovery as well as development. And it's important to note that we still have extremely high confidence in sotagliflozin, particularly for type one diabetes. More news will come forward on a SOLOIST and SCORED program on November 16 at 8:00 PM at the American Heart Association. I would encourage you to chime into that program to hear those data be called out. For LX9211, our confidence is very high around this program. I thought Dr. Tyle did a very good job of outlining why our confidence is high and what we've seen pre-clinically and what's been supportive in Phase one trials. The way we have designed the Phase two trials I think gives us every shot of being successful in 9211 because this is a remarkably unmet need area. We will continue to push forward with the FDA strategically. And I think we come there transparent how we intend to do that as the quarter progresses and we go into the New Year to ensure that patients have an opportunity to sotagliflozin for type one diabetes. With that being said, I appreciate everyone dialing in and joining us. Thank you.
Operator
[Operator Closing Remarks]
Duration: 40 minutes
Call participants:
Chas Schultz -- Executive Director of Corporate Communications & Patient Advocacy
Praveen Tyle, PH.D. -- Executive Vice President of Research and Development
Jeffrey L. Wade, J.D. -- Executive Vice President, Corporate and Administrative Affairs and Chief Financial Officer
Lonnel Coats -- President and Chief Executive Officer and Director
Yigal Dov Nochomovitz -- Citigroup Inc. -- Analyst
Kevin Kedra -- G. Research, LLC -- Analyst
Stephen Douglas Willey -- Stifel, Nicolaus & Company -- Analyst
