Chas Schultz – Senior Director, Finance and Communications Lonnel Coats – President and CEO John Northcott – VP, Marketing and Commerical Strategy and Operations Pablo Lapuerta – EVP and Chief Medical Officer Brian Zambrowicz – EVP and Chief Scientific Officer Jeff Wade – EVP, Corporate Development and CFO.

Kevin Kedra Steven Willy.

Good afternoon, my name is Lisa and I’ll be your conference operator today. At this time, I would like to welcome everyone to the Lexicon Third Quarter 2014 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will a question-and-answer session. (Operator Instructions). Thank you.

Chas Schultz, Senior Director of Finance and Communications. Sir, you may begin your conference..

Thank you, Lisa. Good afternoon, and welcome to the Lexicon Pharmaceuticals third quarter 2014 conference call. I am Chas Schultz and with me today are Lonnel Coats, Lexicon’s President and Chief Executive Officer; Dr. Pablo Lapuerta, Lexicon’s Executive Vice President and Chief Medical Officer; Dr.

Brian Zambrowicz, Lexicon’s Executive Vice President and Chief Scientific Officer; Jeff Wade, Lexicon’s Executive Vice President of Corporate Development and Chief Financial Officer; and John Northcott, Lexicon’s Vice President of Marketing and Commercial Strategy and Operations.

We expect that you have seen a copy of our earnings press release that was distributed this morning. 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 time to answer your questions.

If you would like to view the slides for today’s call, please access the Lexicon website at www.lexpharma.com. You will see a link on the homepage for today’s webcast.

Before we begin, I would like to state that we will be making forward-looking statements, including statements relating to Lexicon’s clinical development of telotristat etiprate or LX1032 and Sotagliflozin or LX4211.

These statements may include territory patients of the results of and projected timing of clinical trial of such compounds and the potential therapeutic and commercial potential of such compounds.

This call may contain forward-looking statements relating to Lexicon’s growth and future operating results, discovery and development of products, strategic alliances and intellectual property as of other matters that are historical facts or information.

Various risks may cause Lexicon’s actual results to differ materially from those expressed or implied in such forward-looking statements.

These risk include uncertainties related to the timing and results of clinical trials and pre-clinical studies of our drug candidates, our dependence upon strategic alliances and ability to enter into additional collaboration and license agreements, the success and productivity of our drug discovery efforts, our ability to obtain patent protection from our discoveries, limitations imposed by patents owned or controlled by third-parties and the requirements of substantial funding to conduct our drug discovery 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 Mr. Coats..

Thank you Chas and thank you to all those who have joined this call today. During Lexicon’s second quarter earnings call, I may clear that we will work diligently to unlock value of Lexicon’s assets. Today, I’ll provide with our plans on both of our late stage clinical programs. We will start with telotristat etiprate precautionary syndrome.

We will cover our Phase 3 progress. We will also provide insights into our commercial planning in our current best thinking on peak sales of this Fast Track in United States. Lastly, we will reiterate the terms of the deal (indiscernible) for territories outside of North American and Japan.

Next, we will share with you the opportunity and strategy for Type I program Sotagliflozin also known as LX4211 and our intention to move into Phase 3 with this program. We will give you recap of our third quarter 2014 earnings and we’ll make time available to take your questions. Now let’s move into the heart of presentation.

I’ve asked our Head of Commercial Strategy and Operations John Northcott to walk you through the telotristat etiprate opportunity and strategy as this program I moving toward near term commercialization in the United States. John, floor is yours..

Great, thank you, Lonnel. This is John Northcott speaking. I’ll take the next few minutes to provide an overview of the commercial opportunity that exist for telotristat etiprate, Lexicon’s first commercial candidate, which is in Phase 3 development for the treatment of carcinoid syndrome. I’ll focus my section on the follow three topics.

First being where telotristat etiprate fits in the market. Secondly, I’ll provide description of the unmet medical need that telotristat etiprate is addressing. Thirdly, I’ll speak about the size of the opportunity in terms of patients and sales as Lonnel indicated. So firstly a little bit about the condition.

Carcinoid syndrome is the condition that occurs in people with neuroendocrine tumors then (indiscernible). When the (indiscernible) it can opt results in the overproduction of serotonin. This overproduction of serotonin is believed to be the trigger of carcinoid syndrome.

Carcinoid syndrome result in devastating consequences such as excessive life altering diarrhea. Some patients can experience more intend per day. This has significant impact of people’s lives, as you can imagine this can reply the person to their home because they need to be in very, very close (indiscernible) to bathroom.

In addition, people suffer from flushing, they feel also reddish in the face, sweating and tightening of the chest and in some cases, it can lead to carcinoid heart disease which can be fatal. Telotristat etiprate is a novel agent designed to specifically reduce serotonin, which is previously stated into predominant driver of carcinoid syndrome.

Lastly on the slide is important to note that telotristat etiprate has received Fast Track in orphan designation from the FDA and orphan designation from EMA. We’ll now transition to the next slide.

While I like to take a moment to clearly describe where we believe telotristat etiprate can fit into carcinoid syndrome market and how big that opportunity is. As you see the top box, there are approximately 14,000 patients in the US with carcinoid syndrome, almost all them are treated with somatostatin airlock therapy either (indiscernible).

These therapies all stated of care but newly diagnosed carcinoid syndrome. They are given as chronic therapy for the duration and the patient’s life.

(indiscernible) research that we conducted with medical oncologist to treat these patients, indicate there are approximately 45% of all patients in the US with carcinoid syndrome on somatostatin airlock therapy are not adequately controlled.

This is the population that we are focusing on is our clinical development efforts in the population that we intend to seek a label for. Being adequately controlled means the patents can get through a full month without having breakthrough symptoms who are on the somatostatin airlock therapy.

And they need additional medical intervention to help gain control of the carcinod syndrome. And this where few options are available and really no options are proved. Patients become not adequately controlled on SSA therapy who suffer a major impact on the rotten daily activities. The most of us take for granted.

This condition is extremely leveling for patents because they stay near their, near a bathroom that they are not able to control a time the outbreaks of the diarrhea.

The calculations from our commercial opportunity at (indiscernible) we conducted with IMS consulting a healthcare indicates that there are approximately 6,000 patients in the US today with not adequately controlled carcinoid syndrome. Give the (indiscernible) program is in but adequately controlled population.

We had the potential to quickly adders a sizable population that is looking for new and effective approach therapies in the existing US population today. Our estimated peak sales as you can see on the box on the bottom right, exceeds $350 million in the US market, again exceeds $350 million in the US market.

Let’s take into account, the couple of variables one, placebo patient population with carcinoid syndrome and not adequately controlled and we leverage the reference price of the existing SSA therapies. Now go to the next slide, it is just to take a moment to share with you a little bit of the timing of which patients become not adequately controlled.

A commercial opportunity assessments indicates that about 79% of patients with carcinoid syndrome eventually become not adequately controlled on personalized somatostatin airlock therapy and this largely occurs within the first 36 months on treatment with an SSA.

The primary treatment options today when people would become not adequately controlled include getting super therapeutic doses of long acting SSA therapy beyond the label dose which involve addition of a painful injection in the absence of kind of Phase 3 total evidence or the use or rescue therapy of short action SSA therapy that can involve multiple injections.

And really this is why we are excited about towards the enterprise opportunity in the carcinoid syndrome market people that are not adequately controlled. Towards that enterprise how is the potential offer patients in all therapy is supported by (indiscernible) Phase 3 clinical evidence.

So with that I will hand it over to Pablo Lapuerta, Lexicon’s Chief Medical Offer to share with you the data we’ve absorbed in Phase 2 telotristat etiprate and also sharing with you where we are with our Phase 2 program..

Thank you John. The Phase 2 results support our vision for the product profile to telotristat etiprate. The population is a population that had carcinoid syndrome not adequately controlled with octreotride therapy. We studied about 15 patients and we have here as ranking of the reductions and bowel movement frequency (indiscernible).

We see the most profound action in bowel movement frequency on the left and then lesser reduction in bowel movement frequency on the right. So the patients are right in terms of best towards response. These patients had an average of about 6,000 per day coming into the study and they control telotristat etiprate.

The majority of them have reductions are great than 30% in bowel movement frequency. There reductions were associated with reduction in serotonin production and report of adequate release on the majority of the patients. Next one. With our vision we developed our Phase 3 program and that Phase 3 program is progressing well towards completion.

We have one pivotal study telotristat and that is 80%. We’re on track to complete enrolment in last 2014 or early in 2015. Telotristat is a Phase 3 randomized, placebo-controlled study. We were taking approximately 120 to 130 patients with carcinoid syndrome treated with somatostatin analog and then adequately controlled.

We’re treating them in a double-blind for 12 weeks after which they will come through an open label extension period of 36 weeks. The primary end point will reflect bowel movement frequency, it will be the change from baseline and bowel movements and the 12 week double-blind.

Secondary endpoints, if we look a biomarker of serotonin production, which is urinary 5-HIAA, flushing episodes of abdominal pain and other natures. With this, I’ll turn the call back to John..

Great. Thank you, Pablo. Just a couple of words on where we are (indiscernible) telotristat etiprate in a carcinoid syndrome market, significant progress has made to ensure that the telotristat etiprate in carcinoid syndrome market.

We strongly believe the carcinoid syndrome market is an excellent entry point for Lexicon and are pursue to become a commercial biopharmaceutical company, because the market is well defined and that need a significant, there is no direct competition and treating finished in University relatively small, it can be easily targeted to leveraging IMS data.

Our physicians that are currently prescribing SSA therapy for carcinoid syndrome. And with this, we anticipate relatively small commercial infrastructure will be required to support telotristat etiprate’s launch in the ongoing commercialization effort. So going to my last slide regarding telotristat etiprate.

I’d like to cover the recent announcement that we put out a couple of weeks ago with respect to the new collaboration that we have with Ipsen for the commercialization of telotristat etiprate in the ex-North America and ex-Japan markets.

We are very pleased to be in collaboration with Ipsen, Ipsen is a leader for the carcinoid syndrome and neuroendocrine tumors with its SSA drugs somatostatin. We believe strongly the Ipsen will really have accelerate the launch success with telotristat etiprate in Europe and other countries given their establish presence in record of success.

A few other financial detail throughputs noting Lexicon retains all rights in the US, Canada and Japan markets for telotristat etiprate. Lexicon will potentially receive 145 million in upfront in milestone payments during the course of the collaboration plus future royalties.

The upfront payment is 23 million and additional payment are contingent upon achievement of clinical regulatory in commercial milestones. In addition, Lexicon will receive royalties on net sale of telotristat etiprate in the Licensed Territory.

So I’ll now had it over to Brian Zambrowicz, Lexicon’s Chief Scientific Officer to discuss some of the closing previously referred to as spoke one, one who describe our Phase 2 data to date Type 1 diabetes and where we’re headed with our Phase 3 program for Type 1 diabetes..

Thank you John. Sort of the closing I’ll go first in class to SGLT1 and SGLT 2 inhibitor for diabetes. (indiscernible) inhibition of SGLT2 in the kidney resulting in early for glucose cotransporter. What makes that unique is that some addition of that SGLT1 transport in the gastrointestinal tract.

SGLT1 is a transporter primarily responsible for uptake glucose after a meal. So in addition of this target results in decrease absorption of glucose decrease, while glucose storing after meal and elevate GLP-1 release. We have other side this SGLT1 and this would be particularly beneficial for Type 1 diabetes.

By improving glycemic control l and with (indiscernible) insulin needs. Next slide. Type I diabetes in an area of very high medical need with no important new treatment option since – of insulin nearly essential now.

The need is pretty need has three quarter of Type 1 diabetes patents have HbA1c levels about 88 and 7% showing that they do not have good glycemic control.

Part of a reason for this is there are few type of glycaemia which can occur by overshooting on insulin dose, which here is understandable since several longitudinal studies indicate sort of 10% of patients with Type I will (indiscernible). Insulin is also associated with weight gain.

This is become an important issue as about 25% of Type 1 diabetes patients of 25 are obese and about half have metabolic syndrome. Finally, there is a great deal availability in the glucose levels through the day and the challenge imagine these glucose level has a negative impact on the quality of life for these patients. Next slide.

Sort of (indiscernible) extensively are how having over 600 people in point of trials, that these includes in healthy subjects, and patients with Type 1 and 2 diabetes.

We continue to do study to differentiate sort of the closing Type 1 and 2 SGLT1 and 2 in addition and some of the key studies have done our Phase 2 and Phase 2b studies and patients with Type 2 diabetes. Our study in patients with Type 2 diabetes are moderate to severe renal impairment and almost recent study patients with Type 1 diabetes.

We completed all studies referred for the initiation of Phase 3. Next slide. We’ve been focusing our attention on resources on the Type 1 diabetes opportunity based on our very encouraging Phase 2 data.

We studied our clinical program in a double-blind placebo controlled study in 33 patients with Type 1 diabetes and either continues insulin infusion comes for multiple dose injection, we used the 400 milligram dose ones a day and treated for 28 days. We go the next slide.

As we are expecting during effective SGLT1 glucose in after a meal sort of the treatment good result in a reduction in bowel syndrome, a 32% dropped to 6.4% decrease on placebo. This is the primary end point of the study. We do to the next slide.

Despite that reduced insulin requirement, patients treated with sort of those who had improved glycemic control based on multiple measures. Here we show 0.5 time to some reduction in hemoglobin A1c for patients (indiscernible) relative to 0.06% reduction for patients on placebo. With (indiscernible) with only four weeks of treatment.

We go to the next slide. We improved glycemic control without current – when we looked at the results from the continued glucose monitoring, which is show in the pie chart on the slide. On the part is the placebo data baseline on the treatment on the bottom of just of deploys in data that based on treatment.

While that the placebo was a significant incase in the time spend in the private range of 70 to 180 (indiscernible) shown in green and sort of those are increased from 56.4% of the time at baseline to 68.2% for the time on treatment. Whereas it didn’t change on placebo meaning 55.9% of baseline and 54% on treatment.

We also saw significant decrease in the prime strength in hyperglycemia as shown and greater than 180 and sort of the closing it went from 37.7% of the time at baseline the 25% your treatment whereas the time in the hyperglycemic range increased from 35.6 before its 22% of placebo.

Very important need improvement in glycemic control occur in the absence for the increase in hypoglycemia that’s show in the red where we would not see any increase in hypoglycemia with a sort of a growth in children. We go the next slide.

So that also produced significant reduction in body weight as 1.72 kilograms well to a gain of half a kilogram on placebo. Next slide. Our next plan study being done in collaboration with JDRF, who will got patients – patients population with a high unmet medical need.

If you got a patient less than 30 years of age with Type 1 diabetes may won’t see great than 9.

Then Phase 2 double-blind placebo control study when roll up 89 patients for two month period to 12 week will be once again slow and like 400 milligram ones daily dose with the primary end point of reduction that we see at 12 weeks and secondary endpoint looking at glucose their ability as well insulin requirement. Next slide.

We continue to prepare sort of closing for Phase 3 in Type 1 diabetes. We completed all in the Phase 2 meeting with FDA and have had scientific advise meeting with various European National Authorities.

Although they preferred an integrated Phase 1 and 2 program, Type I standalone program at placebo and we’ve been preparing the last Phase 3 program in Type 1 diabetes in early 2015. We will require two pivotal studies to demonstrate efficacy.

The primary object in those studies will be the reduction in (indiscernible) versus placebo on an optimized insulin treatment. Importantly with no increase but you have glycemic. Additional objective is one include product the ability in the glucose level while insulin needs weight loss and takes you recorded outcome.

Now coming to standalone program third Phase 3 study will be required to make the safety requirements. With that I’ll turn the call back over to John Northcott to cover the commercial opportunity for (indiscernible)..

Great, thank you Brian. As Brian indicated in his opening slides, approximately 25% of all adults Type 1 diabetes patients have an elevated A1c, they are not achieving the target set by the American Diabetes Association. But many of them having an elevate A1c can have serious long-term consequences, heart disease, kidney disease and blindness.

Sphingosine target profile is designed to address the key patient barriers and challenges that exist and prevent people from achieving the American Diabetes Association A1c target. I’d like to spend a few more minutes to describe the slide and describe some of the reason why people are not achieving their A1c targets.

So focusing first under the title 1a boxes, perhaps the patients, our market research indicated reason why they are not achieving A1c targets is because they have a low level of engagement in their disease. And the reasons vary, for some patients is because they not well informed and do not appreciate the long term consequences of an elevated A1c.

For others, they are very well informed and as (indiscernible) for various and so why they are constituting not to achieve A1c. Some of the reason are, one, they don’t want to gain weight. This is often more common in younger females as increasing insulin can cause weight gain.

Another consider that to be too much work and they do not be want to be bothered testing and monitoring the glucose levels or taking frequent injections. And lastly, some patients have a bad severe hypoglycemic event from taking too much insulin and now have decided to not be aggressive with their A1c management.

Moving over the 1d which is people monitoring the A1c target but have high engagement, for this group this is a completely different story.

These patients were very, very hard to achieve A1c target, however despite their best efforts they are following the appropriate diets, active glucose monitoring and following their prescribed insulin doses, these patients are not successful. This is very difficult as you can imagine in a very compliant but still not achieving their goals.

They recognize the more need insulin throughout to achieve your goal. Sotagliflozin is designed to help more patients get to go more consistently easier and reduce the fear of severe hypoglycemia.

In addition, we believe Sotagliflozing somatostatin profile even has the potential the benefit patients currently achieving their A1c, reducing the burden of managing their disease, making this more consistently and reduce of fear of severe hypoglycemia. Now going to next slide.

You are looking at the results from the commercial opportunity of estimates that we conducted endocrinologist and practitioners in the market of Type 1 diabetes, as you can see when telotristat etiprate profile the response was very favorable.

With that days just as a projected option of somatostatin patents, adult patients of Type 1 diabetes was more than 50%.

I think they are speaking to the physicians truly understand into alone is not adequate, they are managing this challenging disease and now go approaches like the addition of somatostatin and needed and they can play an important role of the future care for Type 1 diabetes.

On the next slide, there is feedback when you see compared – for physicians we also start feedback compared. This slide summarizes the feedback from ten large health plans I’d say they share with us their view of some of the high medical need that they observe from Type 1 diabetes.

Payers view achieving optimal A1c target as a major issue that’s something that is not currently being addressed alone. In addition they believe the (indiscernible) being about to reduce severe hypoglycemia and major gaps in the current standard of care.

All three of these areas we believe can be addressed to the sphingosine target profile in a areas of key focus in a development plan.

To interviewing 32 visions and 10 payers our US commercial opportunity assessment for the Type 1 diabetes market indicates that peak sales opportunity can exceed $1 billion because they are addressing the key areas of unmet need in the Type 1 diabetes market which is helping more patients achieve the American Diabetes Association A1c target without increasing their risk of severe hypoglycemia.

Going to the last slide.

Lastly and importantly through our assessment of the US Type 1 diabetes market, we believe that the Type 1 diabetes market is something that Lexicon can commercialize in alone with other partner because they opportunity is significant and the commercial footprint required to call endocrinologist in a very select member of primary care physicians is quite reasonable when they can be done with a (indiscernible) relative to the sales potential.

So in conclusion, all carcinoid syndrome in Type 1 diabetes markets are failing opportunities for Lexicon, we look forward to competing our clinical development programs so that we can bring and meaning products to patients who divers to the value.

I’ll now hand it to Jeff Wade, Lexicon’s Chief Financial Officer to review our Q3 2014 financial results and our outlook..

Thank you John. I will provide a brief financial update and then I’ll wrap up. As indicated in our press release today, we had revenues from the 2014 third quarter of $0.4 million an increase of $0.2 million in the prior year period. The increase was primarily due to increase technology license fees.

Our revenues were $1.4 for the nine months ended September 30, 2014 reflected the 69% increase from 0.8 million for the prior year period. Our research and development expenses for the 2014 third quarter decreased 5% to $24.1 million from $25.4 million for the prior year period.

The decrease was primarily attributable to decreases in personal cost as a result of the restricting announced in January 2014 and decreases on last cost. As we further saw our resources on late state credit. These production were partially offset by increases in external clinical and pre-clinical research.

For the nine months ended September 30, 2014 our R&D expenses decreased to $69.2 million for $69.4 in the prior year period. The acquisition of Symphony Icon, we made an initial estimate of the fair value of our liability for the base and contingent payments.

Changes in this liability based on the development of the programs and the time until those payments are expected to be made, are recorded in our consolidated statements of operations.

The fair value of the Symphony Icon purchase liability decreased by $1.1 million in the third quarter and increased by $0.5 million in the nine months ended September 30, 2014. Our general and administrative expenses for the 2014 third quarter were $4.6 million, a slight decrease from $4.7 million in the prior year period.

Our G&A expenses of $15.4 million for the nine months ended September 30, 2014, reflected a 13% increase from $13.7 million for the prior year period. In September 2014 we determined our buildings and land to be classified as assets holds for sale.

We recognize a non-cash impairment loss on our buildings of $13.1 million in the third quarter as a result of writing down the buildings to the estimated new selling price.

We’re working towards the sale of these facilities in the near term, which will allow us to right size our facilities to set out current more focused operation and to reduce our associated operating expense by about $5 million annually from where we are today.

Our net loss for the 2014 third quarter was $40.5 million or $0.08 compared to the net loss of $31.7 million dollars or $0.06 per share in the prior year period.

Our net loss for the nine months ended September 30, 2014 was $97.4 million or $0.19 per share compared to a net loss of $86.7 million or $0.17 per share for the corresponding period of 2013.

For the three and nine months ended September 30, 2014, our net loss included non-cash, stock-based compensation expense of $1.5 million and $5.6 million respectively. For the three and nine months ended September 30, 2013, net loss include $1.8 million and $5.7 million respectively.

Finally as of September 30, 2014, we had $57.9 million in cash and investments, as compared to $79.0 million as of June 30, 2014 and $129.1 million as of December 30, 2013.

Subsequent to the end of the quarter, we signed our agreement with Ipsen for commercialization (indiscernible) in Europe and another markets outside of North America and Japan and then which we will see the net payment of $23 million, so this will affect cash going forward.

We share equally with Symphony to a cap in partnership proceeds relate in queue to expect (indiscernible). So the net amount available to us from payment will reflect payments that we make to Symphony with agreement. Payments that we can make in cash or mix of cash in stock at our option. Now let’s turn to our forward-looking guidance for 2014.

We expect contractual revenues from existing agreement for 2014 of around $1.5 million to accounting for revenues fully that to the agreement. We will also – revenue in an amount feature (indiscernible) related to the $23 million of agreement we received from Ipsen.

We expected our operating expense in 2014 will be in the range of $120 million to $125 million that is up from our previous guidance of $105 million to $110 million primarily due to the $13.1 billion dollar non-cash impairment loss until it’s recorded in the third quarter.

Non-cash expenses are expected to be approximately $24 million at this total including the $13.1 million impairment loss in buildings, $7 million is stock based compensation, $2 million in increase in fair value Symphony Icon purchase liability and $2 million in depreciation and amortization.

Taking into account, cash received and our existing contractual relationships including the $23 million under the Ipsen agreement, we expect our 2014 net cash used in operations to be in the range of $64 million to $69 million.

As I mentioned, we will also be making a payment to Symphony relating to that flat payment of Ipsen agreement with any cash portion of that payment being recorded in the investing activities and that’s not in the next cash used in operations.

I should note that these operating expense and net cash used expectations reflect all the preparations we are making through Phase 3 development that’s (indiscernible) as well as certain supported activities do not reflect the core cost of Phase 3 clinical trials.

With the compelling results for sphingosine Type 1 diabetes, we are moving forward with efforts to get out for Phase 3 development that in any case (indiscernible) program in our late 2015.

So to sum up maybe just like 27, we have two late stage programs relates – the two programs relates to development for carcinoid syndrome and our pivotal Phase 3 study is about 80% in a row and completion of a normal is expected in late 2014 or early 2015 and commercial preparations are underway to that program.

We also have (indiscernible) for diabetes with launch of Phase 3 for Type 1 diabetes coming for early 2015. Maybe just like 28, the opportunity for lifetime is very promising and we believe that it is promising in light of the full ownership that we have with US are worldwide (indiscernible).

We are strategically valuable for commercialization collaboration with Ipsen for its drug candidates and other markets outside of the US, Canada and Japan and partnership potential for Sotagliflozin in Type 1 diabetes and in Type 2 diabetes.

Both of these drug candidates offer an opportunity for major advance in patients care in areas being where they are treatment options and not that much we think pharmaceutical innovation.

There is a substantial market opportunities for both US and Canada and so we have (indiscernible) of about $350 million toward (indiscernible) in carcinoid syndrome and over billion dollar for Sotagliflozin in Type 1 diabetes. Each one drug candidates like drive significant corporate value for Lexicon. I will not turn the call back to Lonnel..

Well, thank you Jeff. As we have now grown over both of our program, our strategic intend to advance our first program telotristat etiprate toward maker we have sort of opportunity the moment of Phase 3 quite rapidly, we think we have an opportunity to significantly value of our (indiscernible).

With that being said, I’d like to think you for talking the time to be on this today and open the flow up for additional question..

(Operator Instructions) And you first question comes from (indiscernible).

Good afternoon. Thanks for taking my question.

My first to – like to start, I think a couple of times in the prepared remarks you made something the Phase 3 trial is 80% enrolled, but that enrolment could complete by the end of the year, about seven weeks passed in the year, that seems like a very rapid acceleration in enrolment over the prior Phase just finished by the end of year.

Is that possible or should we be really thinking about sometime in Q1 enrolment competed?.

This is Lonnel, you know PMA a significant progress over the last quarter itself we plan innovation and I think innovation profit looks pretty good for the rest of the year, but we’re not going to give up on their objective until we get to the end.

But your point it is very likely there is great chance that we end up in January before we complete the progress. But we feel very good right now with the current level amortization that we could get it done by the end of year..

Okay.

And what’s the disclosure strategy, we see there that shortly after that 12 week Phase or I guess just more generally when should we expect to see this?.

Yeah, our goal is to have top line date available by the December and at that time we will definitely make that to the public..

Okay.

My last is on 4011, you mentioned in the Phase 3 trial FDA they did make control no increase in hypoglycemia but it just seems much more if you more you want seeing some patients probably small interest in hypoglycemia, do have the qualitative sense for what it is – is around hypoglycemia like what percentage point increase in patients who have it will be acceptable to them and above what increase to be really begin to that?.

Well that’s a great question.

Brian, let me turn that over to you?.

We actually we believe of the mechanism of action of sort of a to informing the pennant mechanisms of action that you can improve glycemic control with no interest with type of glycaemia and that was born out in Type 1 study today.

If you think of the two informant dependence mechanism of action is sort of plots reducing your insulin I think we can expect Phase 3 data that is consistent that that. Likewise we just really not seen a hypoglycemia single in Type 2 diabetes, it’s just not as not an issue this drug and it’s mechanisms of action..

That’s very helpful. Thanks for taking my question..

Your next question comes from the line of (indiscernible)..

Hi, thanks for talking my questions.

A couple of them, one of them when you come back to Sotagliflozin around the Phase 3 plans there, can you give us a some little better sense the size of the three different trials here you know the safety versus two efficacy ones and maybe on timing? And then the other one, you had a few personal today that you mentioned in separate press release, can you talk about where think stand in terms of the infrastructure and maybe can you give us a sense in ‘15 how much more we can expect that to be built upon and any sense on spending on that? Thanks..

Alan, those are two very good questions. Let me first pitch the question the question over to Brian relative to (indiscernible) and then I’ll come back and answer the question related to the personal..

Sure, we know that the five at the two studies to show efficacy the studies for Type 1 diabetes which were going to using two doses Sotagliflozin and placebo with about (indiscernible) where they are about to 750 patients studies. And then the additional study to get our safety data would be maybe Pablo speak to the size of that one..

Yeah, I believe would be an additional 1,500. We’re targeting to get safety exposure for falling for Type 1 diabetes..

And the time, how long the exposure to drug for that safety study?.

Yeah, I believe that study will provide a 12 months of safety exposure and then package, there won’t some patients where they can see the exposure..

Okay. Thanks..

But your question, do you point its size 12 months, so I think that’s the desire, relative to the personal I’d like spoke to this the last time there were two areas that I thought we could continue to involve more greatly here Lexicon one was to strengthen our overall clinical operations.

Although I think the change has done fairly good job of really advanced since launch adequate in the clinic, but as we move in the Phase 3 and a much bigger population further we’ll need to get more space to see how we run our operations and get ever better and be most cost effective that how we do it.

So the objective here is to synergize a lot of operations so that we can reduce our cost and be much more efficient in how we run our Phase 3 program. And for on the commercial side, as John as laid out to you, if we have top line data next year, we are less than two years from now to being in market.

Therefore we have to start the process to bringing in commercial talent to ready our opportunity. So with (indiscernible) I think he – an addition to us that he had objective. And (indiscernible) would be a great addition to us and helping synergize our clinical operations as we move in the Phase 3 we get progress..

Anyway thanks very much..

You bet..

And your next question comes from (indiscernible)..

Hi this is (indiscernible) Thanks for taking the questions.

Just I am partnering like 4211, can you just give us some updates on the progresses?.

Well let me – what I – as I’ve stated from the last meeting, my objective from the time I came here is to start preventing the company toward a program that we can do on our own. The partnering discussions of – and therefore they were taking too much control of our destiny.

So when we talk about how do we maintain our own control and the best way to do that is to advance our own development and stay in control of our own development and move this program into Phase 3 for Type 1 diabetes. So we know that we can do that by ourselves, we know we can commercialize by ourselves.

We also know very clearly that in the Type 1 space, there are few more competitive new innovations in that space, if it continue on that medical needs, there is lower cost of clinical development commercialization.

And therefore we think with the opportunity to have bidding on a plus drought in peak sales, we think if there is going to be a partnership, that partnership much add value beyond that opportunity. So the conversations of float that last my focus more my focus now how to create value today using the as such resources in Lexicon..

And your next question comes from Steven Willy..

Hi thanks for talking the question.

I guess now that you been able to kind of now in some of these travel comments, do you have a better estimation of about the real cost of the Phase 3 type programs going to be?.

(indiscernible) The cost I think as we balanced previously, the cost of clinical studies for the pivotal studies as the two pivotal studies would be less than $100 million, and that cost is more than $100 million as we – and that per saying that stabilizing products would be the additional safety studies.

We’re continuing to work to find that but that’s and sort of ballpoint that’s medical cost..

How much than a 100 and then it coming to the safety study or is not good as good safety study?.

If we include in the safety study will be more than $100 million for the clinical study, so their cost..

And then I guess seeking it right from both you may and FDA, are there two agencies relatively consistent with respect to the preference for a more integrated development program. I know FDA has been obviously quite honorees in terms of see the requirements in the mid of (indiscernible).

Well I think Steven to your question, as we stated before it has the preference of both the agency that they are like seeing fully integrated program to Type 1 and Type 2 but that does not close after pursuing Type 1 of the standalone by itself.

Relative to CBOT requirement as you know the CBOT requirement is specific to Type 2 on a patient type relation and the other way we would do that be something Lexicon cannot do that alone. The only way we will be able to do that is go into Type 2 and a partnership arrangement.

However we feel very confident with the advice and the discussions we’ve that we have a clear pathway for the Type 1 and we can move there alone on a standalone bases and create value..

Understood, and with respect to the upfront Ipsen payment then I am assuming that I guess based the arrangement with Symphony Icon that after than those two Symphony and then like exactly you mentioned the remaining amount of the contingency payments can be made at some point on both the cash and/or stock basis?.

Half of that will end up having to you pay the company, it can beat that, can be paid either and cash and stock at our option and that requires to the remaining to the payment. And then at some point we’ll hit the gap which we think may happen on the pre-commercialization payments arrangement so we are on our way that turning to pull right again..

Okay, and then just lastly, I know there is being some development/excitement around Symphony as target and I know that you guys had a Symphony asset that was in development and that let you kind went back and bit of an exploratory dosing that seem to be suggestible some kind of another thing we’ve really heard much you guys are obviously focused on for just adding and for (indiscernible) I’m just wondering if there is been any kind of interest on the downside whether or not you think that also maybe and if the other really a stand of assets, that you guys have a lot or somewhere would be a really – or any interest to any parties?.

Steven it might be little lot, it might be but to be frank with you and it is three and half months I’ve been here, I am not focused on that very much about.

And the reason for it is these late stage assets we had to figure out that’s an important value and probably build that quickly as well can and make sure we have the resources be there to achieve. The most value of is close to us and front us and start to create opportunities to drive revenue.

But at some point to your point, we will look at and we will try to figure out the value for all the assets and we have in our Phase 2 are currently on hold but I think moment is several months ahead us and that was (indiscernible).

Okay. Thanks..

Next question comes from Kevin Kedra..

Hi, I want to follow up on the question about partnership, just wondering if you guys feel like you have enough data with you have now but you could be actively engaged in partnership discussions on Phase 2, would you feel like there is (indiscernible). I need to be generated there.

And then secondly on (indiscernible) I was wondering if you got any sort preliminary discussion with payers take away around that sort of price point that you kind of implied in your peak sales and around 4900 or so, I am just want to know if you have any discussions on that point?.

Let me now do the partnership question and then I will pitch it over to our Head of our Commercial Strategy John Northcott. So I think LX4211 has been well characterized today for Type 2. And I think the best way for us to eventually if we decided afford long program is to advanced type one program interface three and make headway there.

I don’t believe there is any additional update and then we do it steady other than going in Phase 3 on Type 1, they would attract a partner anymore unless that we’ve already done to date.

And best opportunity always create value and our partnership is continuing and develop and I think we now have that pathway it’s very clear, Type 1 is where we can absolutely win.

We can control that pathway, we can get there, we can get there quicker because we have already created data in type and Phase two and so we have to chase to burdens and hand well that and then they trade additional value and opportunity the part in the future, but that will be a decision that we will make and could it be in control are in development.

One of things we can do is love slow process of discussions really dictate the page by which we pursue the development. So at this point, all hand on debt can do a lot on Type 1 and hopefully and as future unfold we may have the opportunity partner in the Type 2 safety.

With that I said John I pitch it over to you for the second part of that question..

Great, thank you. So the positioning of Telotristat etiprate is in patients that are not adequately controlled on nearly 30 milligrams are satisfying alone.

And the one of the leading (indiscernible) for the cause of that point is really the doubling or tripling is kind of starting build the pitch which then doubles and triples the cost of somatostatin LAR in the US base.

And so therefore we believe that there are certainly a great opportunity to price a parity of premium to the SSA therapy that’s existing on the market today.

We had conducted market research and we are going to continue to better understand the market access dynamic and the price of point where telotristat etiprate for a modeling we use a parity of SSA, we’ll continue to access that opportunity as we get closer to commercialization..

(Operator Instructions) And there are no more further question is the queue at this time..

Let me say thank you to everyone for participating in this call today. And we also always appreciate the interest you have on Lexicon. Have a great evening..

That concludes today’s conference call. Thank you for your participation and you may now disconnect..