Ironwood Pharmaceuticals Provides First Quarter 2013 Investor Update

  Ironwood Pharmaceuticals Provides First Quarter 2013 Investor Update

Business Wire

CAMBRIDGE, Mass. -- April 23, 2013

Ironwood Pharmaceuticals, Inc. (NASDAQ: IRWD) today provided an update on its
first quarter 2013 and recent business activities.

“We and Forest have made significant process advancing LINZESS during the
first few months of commercialization, and the positive response from patients
and physicians is very encouraging,” said Tom McCourt, chief commercial
officer and senior vice president, marketing and sales. “There have been a
number of favorable early decisions made by key national payers, and the
integrated Ironwood and Forest sales and marketing team is executing at a high
level. While it’s still early, and we have more work to do to deliver LINZESS
to patients in need, everything we are seeing reinforces the substantial
opportunity for LINZESS to treat adults with IBS-C or CIC and to dramatically
grow this category over the coming years.”

First Quarter 2013 and Recent Highlights

LINZESS™ (linaclotide)

  *More than 70,000 LINZESS prescriptions have been filled since the launch
    of LINZESS on December 17, 2012 through April 12, 2013, according to IMS
  *LINZESS net product sales, as reported by Forest Laboratories, Inc., were
    $4.5 million in the first quarter of 2013.
  *Ironwood and Forest continue to introduce LINZESS to the physician
    community in the U.S. To date, more than 50% of high prescribing
    gastroenterologists and approximately 20% of high prescribing primary care
    physicians have prescribed LINZESS.
  *The companies have ongoing discussions with payers to seek broad
    unrestricted access for patients. As of April 2013, approximately 75% of
    adult IBS-C or CIC patients with commercial insurance have unrestricted
    access to LINZESS.
  *Ironwood and Forest completed enrollment in a Phase IIIb clinical trial to
    further evaluate the effect of LINZESS on abdominal symptoms in patients
    with chronic idiopathic constipation (CIC). The companies expect to report
    data from this trial in the second half of 2013.
  *Ironwood and Forest continue to explore development opportunities to
    strengthen the clinical profile of LINZESS within its indicated
    population, expand the product label for broader patient populations and
    indications, as well as explore the potential for linaclotide-based
    combination products. The companies expect to initiate additional U.S.
    clinical trials involving linaclotide in the next 12 months.

Constella^® (linaclotide)

  *Ironwood’s European partner, Almirall S.A., intends to initiate launches
    of Constella in the U.K. and Germany during the second quarter of 2013.

Linaclotide (Rest of World)

  *Astellas continues to advance a double-blind, placebo-controlled,
    dose-ranging Phase II clinical trial of linaclotide in adult patients with
    irritable bowel syndrome with constipation (IBS-C) in Japan. The study is
    expected to be completed in the second half of 2013.
  *Ironwood received approval from China’s State Food and Drug Administration
    of its Clinical Trial Application (CTA) for a Phase III trial of
    linaclotide in adult patients with IBS-C. Ironwood and AstraZeneca expect
    to initiate the Phase III trial in the second half of 2013.

Research & Development

  *In addition to exploring additional linaclotide development opportunities,
    Ironwood continues to advance other programs in its pipeline, which
    include early development candidates and discovery research efforts
    focused on gastrointestinal disease, central nervous system disorders,
    allergic conditions and cardiovascular disease.


  *Ironwood ended the first quarter of 2013 with approximately $242 million
    of cash, cash equivalents and available-for-sale securities. Ironwood used
    approximately $93 million of net cash for operations during the quarter.
  *In January, Ironwood completed a debt financing of $175 million.
  *Ironwood appointed Edward Owens, retired partner, portfolio manager and
    global industry analyst with Wellington Management Company, LLP, to its
    board of directors.
  *Ironwood promoted Mark Currie, Ph.D. to senior vice president, chief
    scientific officer, and president of research & development.

Conference Call Information

Ironwood will host a conference call and webcast at 8:30 a.m. Eastern Time, on
Tuesday, April 23, to discuss its first quarter 2013 and recent business
activities. Individuals interested in participating in the call should dial
(877) 643-7155  (U.S. and Canada) or (914) 495-8552 (international) using
conference ID number 30336328. To access the webcast, please visit the
Investors section of Ironwood’s website at at least 15
minutes prior to the start of the call to ensure adequate time for any
software downloads that may be required. The call will be available for replay
via telephone starting today at approximately 11:30 a.m. Eastern Time, running
through 11:59 p.m. Eastern Time on April 30, 2013. To listen to the replay,
dial (855) 859-2056 (U.S. and Canada) or (404) 537-3406 (international) using
conference ID number 30336328. The archived webcast will be available on
Ironwood’s website for 14 days beginning approximately one hour after the call
has completed.

About LINZESS (linaclotide)

LINZESS is the first and only guanylate cyclase-C (GC-C) agonist approved by
the FDA for the treatment of both irritable bowel syndrome with constipation
(IBS-C) and chronic idiopathic constipation (CIC) in adults. LINZESS is a
once-daily capsule that helps relieve the abdominal pain and constipation
associated with IBS-C, as well as the constipation, infrequent stools, hard
stools and incomplete evacuation associated with CIC. The recommended dose is
290 mcg for IBS-C patients and 145 mcg for CIC patients. LINZESS should be
taken at least 30 minutes before the first meal of the day.

LINZESS is thought to work in two ways based on nonclinical studies. LINZESS
binds to the GC-C receptor locally, within the intestinal epithelium.
Activation of GC-C results in increased intestinal fluid secretion and transit
and a reduction in visceral pain, which is thought to be mediated by decreased
activity of pain-sensing nerves. The clinical relevance of the effect on pain
fibers in nonclinical studies has not been established.

In placebo-controlled Phase III clinical trials of more than 2,800 adults,
LINZESS was shown to reduce abdominal pain in IBS-C patients and increase
bowel movement frequency in both IBS-C patients and CIC patients. Improvement
in abdominal pain and constipation occurred in the first week of treatment and
was maintained throughout the 12-week treatment period. Maximum effect on
abdominal pain was seen at weeks 6-9 and maximum effect on constipation
occurred during the first week. When a subset of LINZESS-treated patients in
the trials were switched to placebo, they reported their symptoms returned
toward pretreatment levels within one week, while placebo-treated patients
switched to LINZESS reported symptom improvements. LINZESS is contraindicated
in pediatric patients up to 6 years of age. The use of LINZESS in pediatric
patients 6 through 17 years of age should be avoided. In nonclinical studies,
administration of a single, clinically relevant adult oral dose of linaclotide
caused deaths in young juvenile mice. LINZESS has not been studied in
pediatric patients. In adults with IBS-C or CIC treated with LINZESS, the most
commonly reported adverse event was diarrhea.

Ironwood and Forest Laboratories, Inc. are co-promoting LINZESS in the United
States. Linaclotide was also approved by the European Commission for the
treatment of adults in the European Union with IBS-C and will be marketed
under the brand name Constella^® through a license agreement between Ironwood
and Almirall, S.A. Ironwood also has partnered linaclotide with Astellas
Pharma Inc. for development and commercialization in Japan and with
AstraZeneca for development and commercialization in China.

About Ironwood Pharmaceuticals

Ironwood Pharmaceuticals (NASDAQ: IRWD) is committed to the art and science of
making medicines, from discovery through commercialization. We’re focused on
three goals: transforming knowledge into medicines that make a difference for
patients, creating value that will inspire the continued support of our fellow
shareholders, and building a team that passionately pursues excellence. Our
first product, linaclotide, is approved in the United States and Europe. Our
pipeline priorities include exploring further opportunities for linaclotide,
leveraging our deep expertise in functional gastrointestinal disorders, and
advancing programs in other areas such as allergic conditions, cardiovascular
disease, central nervous system disorders and other conditions defined by
patient symptoms.Ironwood was founded in 1998 and is headquartered in
Cambridge, Mass. Connect with us at or on Twitter at to learn more about Ironwood. Information that
may be important to investors will be routinely posted in both these

Important Safety Information

LINZESS is contraindicated in pediatric patients up to 6 years of age. Use
should be avoided in pediatric patients 6 through 17 years of age. In
nonclinical studies, administration of a single, clinically relevant adult
oral dose of linaclotide caused deaths in young juvenile mice.


  *LINZESS is contraindicated in pediatric patients up to 6 years of age.
  *LINZESS is contraindicated in patients with known or suspected mechanical
    gastrointestinal obstruction.

Warnings and Precautions

Pediatric Risk

  *LINZESS is contraindicated in pediatric patients up to 6 years of age. In
    nonclinical studies, deaths occurred within 24 hours in young juvenile
    mice (1 to 3 week-old mice; approximately equivalent to human pediatric
    patients less than 2 years of age) following administration of one or two
    daily oral doses of linaclotide.
  *Use of LINZESS should be avoided in pediatric patients 6 through 17 years
    of age. Linaclotide did not cause deaths in older juvenile mice
    (approximately equivalent to humans age 12 to 17 years). Although there
    were no deaths in older juvenile mice, given the deaths in young juvenile
    mice and the lack of clinical safety and efficacy data in pediatric
    patients, use of LINZESS should be avoided in pediatric patients 6 through
    17 years of age.


  *Diarrhea was the most common adverse reaction of LINZESS-treated patients
    in the pooled IBS-C and CIC double-blind placebo-controlled trials. Severe
    diarrhea was reported in 2% of LINZESS-treated patients. The incidence of
    diarrhea was similar in the IBS-C and CIC populations.
  *Patients should be instructed to stop LINZESS if severe diarrhea occurs
    and to contact their healthcare provider, who should consider dose

Adverse Reactions

  *In IBS-C clinical trials, the most common adverse reactions in
    LINZESS-treated patients (incidence ≥2% and greater than placebo) were
    diarrhea (20% vs 3% placebo), abdominal pain (7% vs 5%), flatulence (4% vs
    2%), headache (4% vs 3%), viral gastroenteritis (3% vs 1%) and abdominal
    distension (2% vs 1%).
  *In CIC clinical trials, the most common adverse reactions in
    LINZESS-treated patients (incidence ≥2% and greater than placebo) were
    diarrhea (16% vs 5% placebo), abdominal pain (7% vs 6%), flatulence (6% vs
    5%), upper respiratory tract infection (5% vs 4%), sinusitis (3% vs 2%)
    and abdominal distension (3% vs 2%).

Please see full Prescribing Information including Boxed Warning:

This press release contains forward looking statements. Investors are
cautioned not to place undue reliance on these forward‐looking statements,
including, but not limited to, the potential for LINZESS as a treatment option
for adults in the United States suffering from IBS-C and CIC, Ironwood’s and
Forest’s sales and marketing plans for LINZESS, Ironwood’s and Forest’s goals
with respect to payer reimbursement for appropriate patients, Ironwood’s and
its partners’ anticipated non-clinical and clinical development activities for
linaclotide and their associated timelines as well as the timing of reporting
of the data from such activities, Ironwood’s intended activities for the other
product candidates and early development programs in its pipeline, and the
anticipated launch timeline for Constella in the European Union. Each
forward‐looking statement is subject to risks and uncertainties that could
cause actual results to differ materially from those expressed or implied in
such statement. Applicable risks and uncertainties include the risks that the
market acceptance of LINZESS in the U.S. is not as anticipated, Ironwood or
its partners are unable to manufacture or distribute a sufficient commercial
supply of LINZESS, Ironwood and Forest are unable to obtain unrestricted
and/or Tier 2 access to LINZESS through commercial payers, Almirall is unable
to obtain sufficient pricing or reimbursement for Constella in countries in
the European Union or it chooses to launch Constella on a different timeline,
serious adverse events arise in patients that are deemed to be related to
linaclotide treatment, the incidence or severity of diarrhea in patients
treated with linaclotide is higher than expected, advancements in the further
development of linaclotide in additional patient populations or indications or
in fixed dose combinations do not proceed as expected, or the development of
other products or early development programs in Ironwood’s pipeline, do not
proceed as expected, as well as risks related to the difficulty of predicting
regulatory approvals and the acceptance of and demand for new pharmaceutical
products. Applicable risks also include those that are listed in Ironwood’s
Annual Report on Form 10‐K for the year ended December 31, 2012, in addition
to the risk factors that are listed from time to time in Ironwood’s Annual
Reports on Form 10‐K, Quarterly Reports on Form 10‐Q and any subsequent SEC
filings. Ironwood undertakes no obligation to update these forward‐looking
statements to reflect events or circumstances occurring after this press
release. These forward‐looking statements speak only as of the date of this
press release. All forward‐looking statements are qualified in their entirety
by this cautionary statement.

Condensed Consolidated Balance Sheets
(in thousands)
                                                  March 31,       December 31,
                                                  2013            2012
Cash, cash equivalents and available-for-sale     $ 242,029       $   168,228
Accounts receivable, net                            48                1,487
Inventory                                           19,704            6,699
Prepaid expenses and other current assets          13,853           8,026
Total current assets                                275,634           184,440
Property and equipment, net                         36,100            37,537
Other assets                                       13,359           7,930
Total assets                                      $ 325,093       $   229,907
Liabilities and Stockholders’ Equity
Accounts payable and accrued expenses             $ 56,392        $   48,561
Current portion of capital lease obligations        242               261
Current portion of deferred rent                    2,749             2,735
Current portion of deferred revenue                3,299            3,381
Total current liabilities                           62,682            54,938
Capital lease obligations                           254               308
Deferred rent                                       10,907            11,593
Deferred revenue                                    17,217            18,024
Notes Payable                                       174,601           —
Other liabilities                                   909               992
Total stockholders’ equity                         58,523           144,052
Total liabilities and stockholders’ equity        $ 325,093       $   229,907

Condensed Consolidation Statement of Operations
(in thousands, except share and per share amounts)
                                           Three Months Ended
                                            March 31,
                                            2013               2012
Revenue                                     $ 3,255            $ 12,248
Cost and expenses:
Cost of revenue                               1,231              —
Research and development (1)                  32,753             29,510
Selling, general and administrative (1)       33,374             16,319
Collaboration expense                        24,730           2,055
Total cost and expenses                      92,088           47,884
Loss from operations                          (88,833     )      (35,636     )
Other income (expense), net                  (5,069      )     35
Net loss                                    $ (93,902     )    $ (35,601     )
Net loss per share —basic and diluted       $ (0.87       )    $ (0.34       )
Weighted average number of common shares
used in net loss per share —basic and       108,072,643        103,751,060
(1) Non-cash share-based compensation
expenses included reflected in the
consolidated statements of operations
are as
Research and development                    $ 2,224            $ 1,951
Selling, general and administrative:          3,051              3,721

LINZESS U.S. Collaboration Expense Calculation^1
(in thousands)
                                          Three Months Ended
                                          March 31,
                                          2013          2012   
LINZESS net sales                         $ 4,502         $ —
Commercial costs and expenses^2            71,040        6,474  
Net profit (loss) on sales of LINZESS     $ (66,538 )      (6,474 )
Ironwood’s share of net profit (loss)     $ (33,269 )     $ (3,237 )
Ironwood’s selling & marketing^3          $ 8,539        $ 1,182  
Ironwood’s collaboration expense          $ (24,730 )     $ (2,055 )

^1 The Company collaborates with Forest on the development and
commercialization of linaclotide in North America. Under the terms of the
collaboration agreement, the Company receives 50% of the net profits and bears
50% of the net losses from the commercial sale of LINZESS in the U.S. The
purpose of this table is to present calculations of the Company’s share of net
profit (loss) generated from the sales of LINZESS in the U.S. and the
Company’s collaboration expense; however, the table does not present the
research and development expenses related to LINZESS in the U.S. that are
shared equally between the parties under the collaboration agreement.

^2 Includes cost of sales incurred by Forest as well as selling and marketing
costs incurred by Forest and Ironwood that are attributable to the
cost-sharing arrangement between the parties.

^3 Includes Ironwood’s selling and marketing costs attributable to the
cost-sharing arrangement with Forest.


Ironwood Pharmaceuticals, Inc.
Media Relations
Lisa Buffington, 617-374-5103
Vice President, Corporate Communications
Investor Relations
Meredith Kaya, 617-374-5082
Associate Director, Investor Relations
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