Thank you for holding. Welcome to the Lexicon Pharmaceuticals Fourth Quarter and Year End 2011 Conference Call. At this time, all participants are in a listen-only mode. There will be a question and answer session to follow. Please be advised that this call is being taped at Lexicon’s request. At this time, I would like to introduce your host for today’s call, Wade Walke, Senior Director of Communications and Investor Relations. Please go ahead, Dr. Walke.

Good morning and welcome to the Lexicon Pharmaceuticals fourth quarter and year end 2011 conference call. I’m Wade Walke and with me today are Dr. Arthur Sands, Lexicon’s President and Chief Executive Officer; Dr. Brian Zambrowicz, Lexicon’s Executive Vice President and Chief Scientific Officer; Dr. Pablo Lapuerta, Lexicon’s Senior Vice President and Clinical Development and Chief Medical Officer; and Jeff Wade, Lexicon’s Executive Vice President and Corporate Development and Chief Financial Officer. 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 then use the remainder of our time to answer your questions. The call will begin with Dr. Sands who will discuss our key accomplishment for 2011. Dr. Zambrowicz will then give an update on our LX4211 programs Dr. Lapuerta will then review his status of our LX1032, LX1033, LX2931 and LX7101 programs and Mr. Wade will review our financial results for the fourth quarter and full year 2011 and discuss our financial guidance for 2012. We will then open the call to your questions. If you’d like to view the slide for today’s call, please access the Lexicon website at www.lexpharma.com. You will see a link on our Home page for today’s webcast. Before we begin, I would like state that we will be making forward-looking statements, including statements relating to Lexicon’s research and development of LX1031, LX1032, LX1033, LX2931, and LX4211 and LX7101 in the potential therapeutic and commercial potential of those drug candidates. This call may also contain forward-looking statements relating to Lexicon’s future operating results, financing arrangements, cash and investments, discovery and development of products, strategic alliances, and intellectual property. Various risks may cause Lexicon’s actual results to differ materially from those expressed or implied in such forward-looking statements, including uncertainties relating to the timing and results of clinical trials and preclinical studies of our drug candidates. Our dependence upon strategic alliances and ability to enter into additional collaboration and license agreements, the success on productivity of our drug discovery efforts, our ability to obtain patent protection for 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 Dr. Sands.

Thank you Wade and welcome everyone to the call. As we looked at our pipeline today I think it’s clear 2011 was characterized by significant amount of effort placed and progressing and enhancing our pipeline as we move through Phase 2 development on number of programs that we’ll be talking about each of these today. We also initiated a new program so it’s our fifth program now in clinical development that is LX7101 in glaucoma and we’ll be providing a brief update on the status of that as well. Also in 2011, we fortified Lexicon’s with respect to our financial position and of course this is key so that we are able to progress our pipeline independently and pursue our business model that is to seek partnerships in certain key areas of for large primary care indications so at the end of the call Jeff Wade will be discussing our financials for the year. If you look at – looking forward to on the next slide to 2012, there is a significant amount of activity associated with such a broad pipeline of now five programs. And so I would like to take a moment to walk through those slides and draw your attention to some of the key milestones over the next 6 to 24 months. So, starting from where we stand now at the end here of Q1 and the bottom of this pipeline slide that this – pipeline slide you see the progression of each program with respect to initiations and launches. And at the top our key events we expect with respect to results and milestones for each program. So, starting from the top left, of course the milestone that is perhaps most significant is for LX4211 in diabetes our Phase 2b results are expected at the…

Thank you, Arthur. As Arthur mentioned, we are continuing to build the mechanistic story of the dual SGLT1 and inhibitor SGLT2 inhibition that we achieved with our LX4211. And as well as continuing to build the differentiation story relative to other agents to treat diabetes as well as the SGLT2 selective agent. We thought we got a real opportunity by combining our LX4211 with the DPP-4 inhibitor, the reason for that is that we’ve now shown in multiple studies in both patients with type 2 diabetes as well as healthy subjects that LX4211 through its inhibition of SGLT1 triggers an elevated release of beneficial gastrointestinal peptides such as GLP-1 after meals. And since DPP-4 inhibitor is preventing an activation there was real rationale that together there could – these two agents could provide enhanced glycemic control and benefits for patients. We can go to the next slide. We first studied the combination in single dose studies in mice and that’s shown here. What we did is, we dosed the animals and now we’re looking at the active GLP-1 levels on the Y axis two hours post dose and vehicles in green, blue is going to be LX4211 alone, orange is sitagliptin alone and red is the combination. And what you can see here is that two hours post dose LX4211 and sitagliptin are both having modest effects on active GLP-1, but the combination is providing more than a matter of the fact there is a synergy in elevating active GLP-1 with the combination therapy. And based on this data, we chose to go ahead and examine the combination indications with type 2 diabetes. So, we again chose to a single dose study, these are in patients, ageing patients with type 2 diabetes with the blinded study triple crossover with wash…

Thank you, Brian. The first program to discuss is LX1032 which is also known as telotristat etiprate which is being developed for carcinoid syndrome. Our goal for 2012 is to prepare for a Phase 3 program in carcinoid syndrome and that will include regulatory interactions with the Food and Drug Administration and the European Medicines Agency. Another thing we hope to accomplish in 2012 is to explore the use of telotristat etiprate in patients with ulcerative colitis. And preparing for the Phase 3 program we shared the clinical trial results we had from Phase 2 in carcinoid syndrome which will positive and encouraging with several experts in the field. And the feedback has been supportive and it helped us develop a protocol synopsis and design for that we would accomplish during Phase 3. We hope to target a population similar to Phase 2 a population with carcinoid syndrome that is refractory to the standard of care and that standard of care right now is somatostatin analogues therapy. We’re encouraged by Phase 2 results which showed a reduction in bowel movement frequency and hope to demonstrate a similar reduction in bowel movement frequency here over the course of 16 weeks a longer duration of time in a Phase 3 program. We’re also looking at multiple secondary end points that can address patient reported outcomes like relief of symptoms specifics around gastrointestinal symptoms that are associated with carcinoid syndrome and also changes in biomarker urinary 5-HIAA being an important marker of the inhibition of serotonin synthesis with telotristat etiprate. In doing this we’ve already submitted to the FDA a request for end of sales meeting to be held at possibly at of the first quarter of 2012 and in parallel we’re proceeding with our plan to acquire scientific advice also we’re seeing…

Thank you, Pablo. I will provide a brief financial update. As indicated in our press release today we have revenues for the 2011 fourth quarter of $0.3 million which is a decrease of 73% from $1.3 million in the prior year period. For the year revenues decreased 62% to $1.8 million from $4.9 million in 2010. Our research and development expenses for the 2011 fourth quarter increased 54% to $28.1 million from $18.3 million in the prior year period. The increase was primarily attributable to higher external clinical research and development and manufacturing costs. For the year our R&D expenses increased to 17% to $91.8 million from $78.5 million in 2010. In connection with our 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 all such payments are expected to be made, are recorded in our consolidated statements of operations. The associated increase in fair value of Symphony Icon purchase liability was $1.6 million in the fourth quarter and $6.8 million for the year. Our general and administrative expenses for the 2011 fourth quarter were $4 million, an increase of 4% from $3.9 million in the prior year period. For the year, our G&A expenses decreased 11% to $17.4 million to $19.4 million in 2010. Our net loss for the 2011 fourth quarter was $33.8 million or $0.10 per share compared to a net loss of $23 million or $0.07 per share in the prior year period. Our net loss for the year was $116.2 million or $0.34 per share, compared to a net loss of $101.8 million or $0.34 per share in 2010. For the 2011 fourth quarter, our net loss…

Thank you, Jeff. As you are formulating your questions I think you could see from our update that we are embarking on really the – one of the busiest years in the clinic the Lexicon ever have multiple trials of size across multiple therapeutic areas. So, we can now enter into the question-and-answer session.

(Operator Instructions). Your first question comes from Phil Nadeau with Cowen and Company. Philip Nadeau – Cowen & Company: Good morning, thanks for taking my questions. Just a couple of short ones . On the new candidate LX7101, could you give us some idea of what changes in intraocular pressure would serve us proof-of-concept in the kind of study, what are you hoping to see?

Brian do you want to take that question?

Yes, in this initial study roughly a 20% drop intraocular pressure would be very encouraging. Philip Nadeau – Cowen & Company: Okay, fair enough. And then on LX1032 in carcinoid you mentioned in your prepared remarks, this is the year where you going to prepare for Phase 3 with meetings with the FDA and EMA. Can you talk a little bit more about the status of those meetings have you scheduled them have you submitted pre-meeting docs to the agencies?

Pablo would you like to go ahead on that?

Yes, we’ve submitted a meeting request to the Food and Drug Administration. And so the – we’ve received a response, we don’t have the exact date yet, but that will be somewhere between the last week of March and first week of April. And then for the European Medicines Agency, we’ve planned to submit our intent this week, scientific advice at the next date for this, which is around now the middle of February. Philip Nadeau – Cowen & Company: Okay. And is there – it seems like these meetings therefore could happen pretty earlier in the year, is there a chance that these pivotal trials actually start this year?

Yes we hope that we can start a Phase 3 program in this year. And in terms of our manufacturing and these regulatory interactions they all come to a fruition about the same time in terms of the time for initiating sites and finalizing protocols and having drugs if are available. And so we will be looking towards the end of the third quarter or early fourth quarter for initiation of the Phase 3 program as the regulatory interactions are supported. Philip Nadeau – Cowen & Company: Great, thanks for taking my questions.

Thank you.

Your next question comes from Stephen Willey with Stifel Nicolaus. Stephen Willey – Stifel Nicolaus: Hey hi thanks for taking the question. I was just wondering maybe if you could maybe just clarify the charges on a little bit on 2931 is that total treatment period across all the escalated doses 12 weeks?

Yeah Pablo, do you want to talk about the design.

Yes the total treatment period across all doses is 12 weeks, so you start with 150 milligrams and go up to a sequential doses until you reach 500 milligrams and so I believe it’s about six weeks of the 500 milligram dose. Stephen Willey – Stifel Nicolaus: Okay, so you’re pretty much cycling patients through the first three or four doses over the first six weeks and then they are kind of matched out at the 500 for remaining six?

Exactly. Stephen Willey – Stifel Nicolaus: And is it lymphocyte reductions specifically that you guys are looking at in terms of making a decision to dose escalator or is it or is it more safety geared?

The safety is really the parameter for dose escalation. Stephen Willey – Stifel Nicolaus: Okay. And in terms of the biomarker that you’re going to be implementing now in IBS, do you essentially view that as a means to gauge non responders or potential non responders from a pivotal strategy is that kind of how you’re looking at how this get to use longer term or by you may treat patients for a couple of weeks and then use the biomarker to kind of kick the non responders out.

While we suggested by our experience with LX1031. The – however LX1033 is a more important drug that can produce more or less to identify HIV reduction. So, one of the possibilities that we have to consider is that the biomarker would not really exclude a patient, but help guide the right dose, it could be that a patient does not respond at a lower dose and could benefit from a higher dose. So, I think those adjustments with discontinuing of a patient if the patient does not have evidence of uncondition of serotonin synthesis at the highest dose would be a potential use of a biomarker. Stephen Willey – Stifel Nicolaus: And then just lastly on 4211, can you remind us where you guys are in terms of completing preclinical talks. And then I guess as a follow-up to that. In your conversations on the BD front do you get the sense that a potential partners mean obviously they’re waiting for the Phase 2b data, but are they also waiting for some of these other larger Phase 3 SGLT trial 3 maybe specifically the JJ trial to get an idea as to whether or not the oncology signal is replicated?

Brian, do you want to take the preclinical part and then start giving...

Sure. We’re now in completion of our long-term red and (inaudible) and we anticipate that around midyear. We really have to step things up so that we have everything in place to be Phase 3 ready in order to initiate Phase 3 with a potential partner in the first half of next year. Stephen Willey – Stifel Nicolaus: Is there any color you can provide on the talks today specifically on the GI front?

It’s been consistent in all pre-clinical and clinical studies to-date. There been no signal-that increase diarrhea I’d go further into say that six and nine months (inaudible) even at the highest doses there were no observatives of diarrhea. So it’s held up really well pharmacological inhibition of SGLT1 does not appeared to be associated at this client list in increased diarrhea.

And then Stephen you had a request on the BD front, Johnson and others may want to count on potential dynamic.

Sure. So well I think the main thing that people are waiting to see or that Phase 2b result for our compound. I think that people that we’re talking to do view the mechanism is being different and because we got the two mechanisms so it’s not an apples-to-apples comparison obviously. And I think I would I think it is relevant when the results are of the other parties but I would say that our compound is distinguished in this – it is being distinguished from the other compound in this scenario. Stephen Willey – Stifel Nicolaus: Thank you for the color and congrats on the progress.

Thank you Stephen.

Your next question comes from David Friedman from Morgan Stanley. David Friedman – Morgan Stanley: Hi thanks for taking my question. This Brigand calling in for Dave. So it seems like the new IBS trial improved criteria is slightly different from FDA guidelines and I’m just wondering if there is a specific reason why you didn’t file the guidelines and also assuming that the Phase III has to be run according to the guidelines, how do you get comfortable evaluating the drug in Phase II in a slightly different population. And you need to run the Phase III in?

Pablo, would you like to take that question?

Yes, I think we got comfortable with our proposed entry criteria for Phase II and believe that we would use the same entry criteria Phase III by interacting with the Food and Drug Administration. And so the – there is a guidance but we have experience with serotonin synthesis inhibition, we are able to look at how the guidance, it’s a population that benefited from use of LX1031 and then come up with the reasonable proposal for LX1033. And we feel that although there is some minor differences our population is a little bit broader and a little bit more inclusive than the original FDA document that was – something a draft document and we’re well within the intent of that guidance. So we feel more comfortable moving forward with our plan. It was one of the reasons for us to interact with the FDA and we think it’s important to work with them closely on this area of patient reported outcomes and how we define both the patient population and response to therapy.

I was just going to comment that as Pablo mentioned that was draft guidance and since that draft guidance came out meeting between – with the FDA and the opinion leaders in the IFB field and our entry criteria, we believe are quite consistent with the modified guidance that FDA has come to agreement with experts in this area. And as Pablo mentioned we did discuss this with the FDA. David Friedman – Morgan Stanley: Okay, great. Thank you.

Thank you.

Your next question comes from Cory Asimov with JPMorgan.

Hi, there (inaudible) in for Cory today. Just a couple of questions. The first one is for 4041, just wondering for a Phase III program to start in the first half of 2013, I guess when is the latest you think you could have a partner on board to kind of meet that timeframe. And then for the Phase III program for carcinoid syndrome just wondering at this stage on the something you haven’t met with the FDA, what kind of in terms of the number of patients, thinking about in that program the treatment duration and the likely endpoint that would be great. Thank you.

Well, Pablo maybe you could take both of those questions.

All right. Let me take the last part first because it’s a very specific around the protocol that we are considering. We are still awaiting feedback and we have – on the actual meeting date, once we have that with some of the briefing document but we do have a protocol synopsis and that envisions a four months of therapy which is consistent with some of the discussions we’ve had before with regulatory agencies. And the total sample size we think that for an orphan drug indication like this that we can get minimum safety and efficacy data on a ballpark of 100 patients. That could be slightly more or slightly less that’s the type of area that we will be discussing with the FDA. And we do feel that reduction in (inaudible) frequency is a clinically relevant measure and an objective measure that it is easy to interpret. So that’s what we are considering for Phase III program and we feel there is a precedent for that as well. So that describes what we’re thinking of in terms of a clinical program for the absorption of drug indication. Could you remind me about the first part of your question had to do...

The first one was just to do with 4211 in order to begin a Phase 3 program in the first half of 2013 when the latest you might need a partner on board for that to occur?

So there is two parts to that while first the logistics that we’re planning right now and then I think just to comment on the partnership timing issue, but maybe you could address the logistics in terms of what we’re doing to get ready.

Did you mean that for Jeff or for me?

No that’s for you Pablo.

Yeah so we’re already starting our interactions with contract research organizations. And we’re talking about the overall scope of the program, the number of studies and what it would take to be to initiate that program and what it would take to initiate it without missing a step because of partnering negotiations. So we think that there are opportunities to give a good start to our Phase 3 program if we have a – and a good arrangement with the contract research organization.

Yeah it’s also worth mentioning that we’ve been working hard at the design of what Phase 3 would like to maximize the probability for success that includes taking into account advice we received from potential partners. So I think what we’re designing would be very much in the line with what they would want to be achieving.

Yeah I think that the thus we are to trying to design something that will be in line with partner expectations. We’re also planning on doing the work to be able to start that without a delay. And so I think that our goal is to have partnership not be a gaining factor into preparation for Phase 3, maybe a preparation for a kicking off the biggest trials. But at least from a preparation stand point we’re making this preparations already.

Okay. Thank you.

Thank you.

(Operator Instructions). And now there are no additional questions at this time.

All right, well I’d like to thank everyone for participating today. And we look forward to keeping you updated in the future. Bye, bye.

Thank you ladies and gentlemen for participating in today’s conference call. You may now disconnect.