Lexicon Pharmaceuticals Announces Stockholder Approval of Invus Investment of Up to $550M
THE WOODLANDS, Texas, Aug. 23 -- Lexicon Pharmaceuticals, Inc. announced that its financing arrangement with Invus, L.P. was approved by its stockholders at a special stockholders' meeting today, with over 98% of all votes cast supporting the Invus investment.
In the initial investment, Invus will purchase approximately 50.8 million shares of Lexicon common stock for approximately $205 million, representing a weighted-average purchase price of approximately $4.04 per share. The initial Invus investment is expected to close on August 28th. As part of the approved transaction, Lexicon stockholders, including Invus, may invest an additional $345 million over the next four years. These combined common stock purchases will provide Lexicon with operating capital of up to approximately $550 million to help it achieve the goals set forth in its 10 to 10 drug discovery and development program.
The 10 to 10 program is an ongoing initiative to advance 10 drug candidates into human clinical trials by the end of 2010. Lexicon expects these ten investigational new drugs to result from its genetics-based drug discovery platform and to include both small molecules and antibodies. The company plans to develop and commercialize its products either independently or under corporate alliances. Lexicon currently has two investigational new drugs in human clinical trials and anticipates initiating human testing of two additional compounds in the first quarter of 2008.
"The Invus transaction provides the financial flexibility to fund our discovery and development pipeline, expand our internal clinical and regulatory capabilities, and enable our pursuit of a commercialization and collaboration strategy that maximizes our value and is less subject to short-term financing pressures," said Arthur T. Sands, M.D., Ph.D., founder, president and chief executive officer of Lexicon. "We are in a very strong financial position to advance the development of our discoveries into multiple investigational new drugs."
"We are committing substantial capital and support to enable Lexicon to develop a diverse and full pipeline of novel drugs that address large markets and major unmet medical needs based on their proprietary platform," said Raymond Debbane, founder and president of The Invus Group, LLC. "We look forward to helping the company implement its strategy over the years to come."
More details of the Invus transaction may be found in Lexicon's proxy statement filed with the SEC on July 20, 2007.
About Lexicon Pharmaceuticals
Lexicon Pharmaceuticals is a biopharmaceutical company focused on the discovery and development of breakthrough treatments for human disease. Lexicon currently has development programs underway for such areas of major unmet medical need as irritable bowel syndrome and cognitive disorders. The company has used its proprietary gene knockout technology to discover more than 100 promising drug targets and create an extensive pipeline of clinical and preclinical programs in the therapeutic areas of diabetes and obesity, cardiovascular disease, psychiatric and neurological disorders, cancer, immune system disorders and ophthalmic disease. To advance the development and commercialization of its programs, Lexicon is working both independently and through collaborators including Bristol-Myers Squibb Company, Genentech, Inc. and N.V. Organon. For additional information about Lexicon and its programs, please visit http://www.lexpharma.com.
About Invus Group
Invus is a New York-based investment firm with additional offices in London and Paris. Invus invests in a variety of equity transactions, including buyouts, longer term public equity investments, venture capital, and expansion financings. Invus manages in excess of $4 billion of capital. Invus has achieved both cash on cash multiples and annual internal rates of return over 22 years that are at the very top of the private equity industry. Invus manages interests in a broad range of industries, including consumer goods, consumer services, education, software, biotechnology and medical devices.
The Invus principals draw on their broad experience in partnering with management teams and boards to help formulate and execute strategies that maximize long-term value.
Safe Harbor Statement
This press release contains "forward-looking statements," including statements relating to, without limitation, all statements regarding the agreement with Invus to invest in Lexicon, Lexicon's growth and future operating results, discovery and development of products, strategic alliances and intellectual property, as well as other matters that are not historical facts or information. All forward-looking statements are based on management's current assumptions and expectations and involve risks, uncertainties and other important factors, specifically including those relating to Lexicon's ability to successfully conduct preclinical and clinical development of its potential drug candidates, advance additional candidates into preclinical and clinical development, obtain necessary regulatory approvals, achieve its operational objectives, obtain patent protection for its discoveries and establish strategic alliances, as well as additional factors relating to manufacturing, intellectual property rights, and the therapeutic or commercial value of its drug candidates, that may cause Lexicon's actual results to be materially different from any future results expressed or implied by such forward-looking statements. Information identifying such important factors is contained under "Factors Affecting Forward-Looking Statements" and "Risk Factors" in Lexicon's annual report on Form 10-K for the year ended December 31, 2006, as filed with the Securities and Exchange Commission. Lexicon undertakes no obligation to update or revise any such forward-looking statements, whether as a result of new information, future events or otherwise.