Ironwood Pharmaceuticals Reports Fourth Quarter and Full Year 2024 Results; Achieves 2024 Financial Guidance

– Announced positive data from open-label extension study demonstrating an increased number of patients on apraglutide achieving enteral autonomy over time –

– Initiated rolling NDA submission; on track to be completed in Q3 2025 –

– LINZESS^® (Iinaclotide) EUTRx prescription demand growth of 11% for full-year 2024 year-over-year –

– 2024 Ironwood revenue of $351 million, GAAP net income of $2 million and adjusted EBITDA of $101 million –

BOSTON--(BUSINESS WIRE)--Ironwood Pharmaceuticals, Inc. (Nasdaq: IRWD), a biotechnology company developing and commercializing life-changing therapies for people living with gastrointestinal (GI) and rare diseases, today reported its fourth quarter and full year 2024 results and recent business performance.

“We believe that 2025 marks the beginning of a transformation for Ironwood that will lay the foundation for growth, long-term value creation, and the delivery of new medicines to rare disease and GI patients in need. We have taken strategic actions to position our organization for success, including streamlining our business operations and advancing the clinical development of apraglutide, while maintaining disciplined financial stewardship to drive cash flows, pay down our debt, and further strengthen our balance sheet,” said Tom McCourt, chief executive officer of Ironwood.

“We have initiated the rolling NDA submission for apraglutide, and we are working with urgency to complete the submission and prepare for potential launch. Our confidence in apraglutide continues to grow, especially in light of the data we shared in January from the open-label extension study. These results show a continued increase in clinical benefit over time, with 27 total apraglutide-dosed patients achieving enteral autonomy. Given these compelling new long-term data, we plan to include additional extension study data in our NDA to deliver a more robust, clinically differentiated, and comprehensive submission package. If approved, apraglutide would be the first and only once-weekly GLP-2 therapy, reinforcing its potential to become a blockbuster drug and significantly expand treatment options for SBS patients.”

Fourth Quarter and Full Year 2024 Financial Highlights¹
(in thousands, except for per share amounts)

Fourth Quarter and Full Year 2024 Corporate Highlights

Apraglutide in SBS Advancing Through Regulatory Submission and Review

• Ironwood is advancing apraglutide, a next-generation, synthetic glucagon-like peptide-2 (“GLP-2”) analog for short bowel syndrome (“SBS”) patients dependent on parenteral support (“PS”), a severe chronic malabsorptive condition. Ironwood believes apraglutide has the potential to improve the standard of care for adult patients with SBS who are dependent on PS as the first and only GLP-2 with once-weekly administration, if approved.

  – Data from the apraglutide open label extension study, STARS Extend, demonstrated that more patients weaned off PS with longer exposure to apraglutide, with 27 total apraglutide-dosed patients achieving enteral autonomy.

  – Ironwood has initiated the rolling new drug application (“NDA”) to the U.S. Food and Drug Administration (“FDA”) for apraglutide for the treatment of adult patients with SBS who are dependent on PS, with submission completion expected in Q3 2025.

Continued Strong Demand Growth for U.S. LINZESS

• Prescription Demand: Total LINZESS prescription demand in the fourth quarter of 2024 was 56 million LINZESS capsules, a 12% increase compared to the fourth quarter of 2023, per IQVIA. Total prescription demand was 212 million LINZESS capsules for the full year 2024, a 11% increase compared to the full year 2023, per IQVIA.

• U.S. Brand Collaboration: LINZESS U.S. net sales are provided to Ironwood by its U.S. partner, AbbVie Inc. (“AbbVie”). LINZESS U.S. net sales were $223.0 million in the fourth quarter of 2024, a 19% decrease compared to $274.4 million in the fourth quarter of 2023, and $916.3 million for the full year 2024, a 15% decrease compared to $1,073.2 million for the full year 2023. Ironwood and AbbVie share equally in U.S. brand collaboration profits.

  – LINZESS commercial margin was 64% in the fourth quarter of 2024, compared to 77% in the fourth quarter of 2023. LINZESS commercial margin was 66% for the full year in 2024 and 73% for the full year in 2023. See the U.S. LINZESS Full Brand Collaboration table at the end of this press release.

  – Net profit for the LINZESS U.S. brand collaboration, net of commercial and research and development (“R&D”) expenses, was $135.2 million in the fourth quarter of 2024, a 33% decrease compared to $202.5 million in the fourth quarter of 2023. Net profit for LINZESS U.S. brand collaboration, net of commercial and R&D expenses, was $570.9 million for the full year 2024, a 24% decrease compared to $749.9 million for the full year 2023. See the U.S. LINZESS Full Brand Collaboration table at the end of this press release.
  

• Collaboration Revenue to Ironwood: Ironwood recorded $88.4 million in collaboration revenue in the fourth quarter of 2024 related to sales of LINZESS in the U.S., a 22% decrease compared to $114.0 million for the fourth quarter of 2023. Fourth quarter of 2024 collaboration revenue to Ironwood includes a $7.2 million positive adjustment to reflect Ironwood’s estimate of LINZESS gross-to-net reserves as of December 31, 2024. Ironwood recorded $340.4 million in collaboration revenue for the full year 2024 related to the sales of LINZESS in the U.S., a 21% decrease compared to $430.5 million in 2023. See the U.S. LINZESS Commercial Collaboration table at the end of the press release.

Streamlined Organization Positioned for Long-Term Success

• In January 2025, Greg Martini was promoted to Senior Vice President, Chief Financial Officer, and Tammi Gaskins was promoted to Senior Vice President, Chief Commercial Officer.
• In January 2025, Ironwood announced a streamlined strategic focus on advancing and realizing the potential of apraglutide in SBS to position the company for long-term growth. This reorganization included a reduction of Ironwood’s workforce by approximately 50%, primarily driven by the elimination of the Ironwood field force. Ironwood expects to incur restructuring charges of approximately $20 to $25 million, which are anticipated to be incurred primarily in the first half of 2025. As a result of the strategic reorganization, Ironwood expects to realize approximately $55 to $60 million of annual operating expense savings, resulting in $40 to $45 million benefit to annual profits, net of impact to collaborative arrangements revenue.

Fourth Quarter and Full Year 2024 Financial Results

• Total Revenue. Total revenue in the fourth quarter of 2024 was $90.5 million, compared to $117.6 million in the fourth quarter of 2023. Total revenue for the full year 2024 was $351.4 million, compared to $442.7 million for the full year 2023.

  – Total revenue in the fourth quarter of 2024 consisted of $88.4 million associated with Ironwood’s share of the net profits from the sales of LINZESS in the U.S. and $2.1 million in royalties and other revenue. Total revenue in the fourth quarter of 2023 consisted of $114.0 million associated with Ironwood’s share of the net profits from the sales of LINZESS in the U.S. and $3.6 million in royalties and other revenue.

  – Total revenue for the full year 2024 consisted of $340.4 million associated with Ironwood’s share of the net profits from the sales of LINZESS in the U.S. and $11.0 million in royalties and other revenue. Total revenue for the full year 2023 consisted of $430.5 million associated with Ironwood’s share of the net profits from the sales of LINZESS in the U.S. and $12.2 million in royalites and other revenue.
  

• Total Costs and Expenses. Total costs and expenses in the fourth quarter of 2024 were $57.3 million, compared to $80.0 million in the fourth quarter of 2023. Total costs and expenses for the full year 2024 we $256.6 million, compared to $1,388.2 million for the full year 2023.

  – Total costs and expenses in the fourth quarter of 2024 consisted of $33.3 million in selling, general and administrative (“SG&A”) expenses, $23.9 million in R&D expenses and $0.1 million in restructuring expenses. Total costs and expenses in the fourth quarter of 2023 consisted of $38.7 million in SG&A expenses, $35.7 million in R&D expenses, $5.0 million in acquired in-process research and development, as well as $0.6 million in restructuring expenses.

  – Total costs and expenses for the full year 2024 consisted primarily of $144.0 million in SG&A expenses, $110.0 million in R&D expenses and $2.6 million in restructuring expenses. Total costs and expenses for the full year 2023 consisted primarily of $1.1 billion in acquired in‐process research and development relating to the acquisition of VectivBio, $158.3 million in SG&A expenses, $116.1 million in R&D expenses and $18.3 million in restructuring expenses.
  

• Interest Expense. Interest expense was $8.9 million in the fourth quarter of 2024 and $33.0 million for the full year 2024, in connection with Ironwood’s convertible senior notes and revolving credit facility. Interest expense was $8.4 million in the fourth quarter of 2023 and $21.6 million for the full year 2023, in connection with Ironwood’s convertible senior notes and revolving credit facility.
• Interest and Investment Income. Interest and investment income was $0.8 million in the fourth quarter of 2024 and $4.5 million for the full year 2024. Interest and investment income was $1.2 million in the fourth quarter of 2023 and $19.0 million for the full year 2023.
• Income Tax Expense. Ironwood recorded $21.9 million of income tax expense in the fourth quarter of 2024 and $64.5 million of income tax expense for the full year of 2024, the majority of which was non-cash, as Ironwood continues to utilize net operating losses to offset taxable income for federal purposes and in many states. Ironwood recorded $32.1 million of income tax expense in the fourth quarter of 2023 and $83.5 million of income tax expense for the full year of 2023, the majority of which was non-cash, as Ironwood continued to utilize net operating losses to offset taxable income for federal purposes and in many states.
• GAAP Net Income (Loss) Attributable to Ironwood. GAAP net income attributable to Ironwood was $3.2 million, or $0.02 per share (basic and diluted) in the fourth quarter of 2024, compared to GAAP net loss of $1.1 million, or ($0.01) per share (basic and diluted) in the fourth quarter of 2023. GAAP net income for the full year 2024 was $1.8 million, or $0.01 per share (basic and diluted), compared to GAAP net loss of $1 billion, or ($6.45) per share (basic and diluted), for the full year 2023.

• Non-GAAP Net Income. Non-GAAP net income was $3.5 million, or $0.02 per share (basic and diluted), in the fourth quarter of 2024, compared to non-GAAP net income of an insignificant amount, or ($0.00) per share (basic and diluted) in the fourth quarter of 2023. Non-GAAP net income for the full year 2024 was $5.9 million, or $0.04 per share (basic and diluted), compared to non-GAAP net loss of $973.8 million, or ($6.27) per share (basic and diluted), for the full year 2023.

  – Non-GAAP net income (loss) excludes the impact of mark-to-market adjustments on the derivatives related to Ironwood’s 2022 Convertible Notes, amortization of acquired intangible assets, restructuring expenses and acquisition-related costs, all net of tax effect. See Non-GAAP Financial Measures below.
  

• Adjusted EBITDA. Adjusted EBITDA was $33.8 million in the fourth quarter of 2024, compared to $39.9 million in the fourth quarter of 2023. For the full year 2024, adjusted EBITDA was $100.6 million, compared to ($884.8) million for the full year 2023.

  – Adjusted EBITDA is calculated by subtracting mark-to-market adjustments on derivatives related to Ironwood’s 2022 Convertible Notes, restructuring expenses, net interest expense, income taxes, depreciation and amortization, and acquisition-related costs, from GAAP net loss. See Non-GAAP Financial Measures below.

  – Note: Beginning in the first quarter of 2025, adjusted EBITDA will be calculated by also subtracting stock-based compensation expense.
  

• Cash Flow Highlights. Ironwood ended 2024 with $88.6 million of cash and cash equivalents, compared to $92.2 million of cash and cash equivalents at the end of 2023.

  – In the fourth quarter of 2024, Ironwood repaid $15.0 million of the outstanding principal balance on its revolving credit facility. The outstanding principal balance on the revolving credit facility was $385.0 million as of December 31, 2024.

  – Ironwood generated $15.2 million in cash from operations in the fourth quarter of 2024, compared to $35.8 million in cash from operations in the fourth quarter of 2023. Ironwood generated $103.5 million in cash from operations for the full year 2024, compared to $183.4 million for the full year 2023.
  

• Ironwood 2025 Financial Guidance. Ironwood continues to expect:

Non-GAAP Financial Measures

Ironwood presents non-GAAP net income (loss) and non-GAAP net income (loss) per share to exclude the impact, net of tax effects, of net gains and losses on derivatives related to Ironwood’s 2022 Convertible Notes that are required to be marked-to-market, amortization of acquired intangible assets, restructuring expenses, and acquisition-related costs. Non-GAAP adjustments are further detailed below:

• The gains and losses on the derivatives related to Ironwood’s 2022 Convertible Notes were highly variable, difficult to predict, and of a size that could have a substantial impact on the company’s reported results of operations in any given period.
• Amortization of acquired intangible assets are non-cash expenses arising in connection with the acquisition of VectivBio and are considered to be non-recurring.
• Restructuring expenses are considered to be a non-recurring event as they are associated with distinct operational decisions. Restructuring expenses include costs associated with exit and disposal activities.
• Acquisition-related costs in connection with the acquisition of VectivBio are considered to be non-recurring and include direct and incremental costs associated with the acquisition and integration of VectivBio to the extent such costs were not classified as capitalizable transaction costs attributed to the cost of net assets acquired through acquisition accounting.

Ironwood also presents adjusted EBITDA, a non-GAAP measure, as well as guidance on adjusted EBITDA. Adjusted EBITDA is calculated by subtracting mark-to-market adjustments on derivatives related to Ironwood’s 2022 Convertible Notes, restructuring expenses, net interest expense, income taxes, depreciation and amortization, and acquisition-related costs from GAAP net income. Beginning in the first quarter of 2025, adjusted EBITDA will be calculated by also subtracting stock-based compensation expense. The adjustments are made on a similar basis as described above related to non-GAAP net income (loss), as applicable.

Management believes this non-GAAP information is useful for investors, taken in conjunction with Ironwood’s GAAP financial statements, because it provides greater transparency and period-over-period comparability with respect to Ironwood’s operating performance. These measures are also used by management to assess the performance of the business. Investors should consider these non-GAAP measures only as a supplement to, not as a substitute for or as superior to, measures of financial performance prepared in accordance with GAAP. In addition, these non-GAAP financial measures are unlikely to be comparable with non-GAAP information provided by other companies. For a reconciliation of non-GAAP net income (loss) and non-GAAP net income (loss) per share to GAAP net income and GAAP net income per share, respectively, and for a reconciliation of adjusted EBITDA to GAAP net income, please refer to the tables at the end of this press release.

Ironwood does not provide guidance on GAAP net income or a reconciliation of expected adjusted EBITDA to expected GAAP net income because, without unreasonable efforts, it is unable to predict with reasonable certainty the non-GAAP adjustments used to calculate adjusted EBITDA. These adjustments are uncertain, depend on various factors and could have a material impact on GAAP net income for the guidance period.

Conference Call Information

Ironwood will host a conference call and webcast at 8:30 a.m. Eastern Time on Thursday, February 27, 2025 to discuss its fourth quarter and full year 2024 results and recent business activities. Individuals interested in participating in the call should dial (888) 596-4144 (U.S. and Canada) or (646) 968-2525 (international) using conference ID number and event passcode 2530602. To access the webcast, please visit the Investors section of Ironwood’s website at www.ironwoodpharma.com. The call will be available for replay via telephone starting Thursday, February 27, 2025, at approximately 11:30 a.m. Eastern Time, running through 11:59 p.m. Eastern Time on Thursday, March 13, 2025. To listen to the replay, dial (800) 770-2030 (U.S. and Canada) or (609) 800-9909 (international) using conference ID number 2530602. The archived webcast will be available on Ironwood’s website for 1 year beginning approximately one hour after the call has completed.

About Ironwood Pharmaceuticals

Ironwood Pharmaceuticals (Nasdaq: IRWD) is a biotechnology company developing and commercializing life-changing therapies for people living with gastrointestinal (GI) and rare diseases. Ironwood is advancing apraglutide, a next-generation, long-acting synthetic GLP-2 analog being developed for short bowel syndrome patients who are dependent on parenteral support. In addition, Ironwood has been a pioneer in the development of LINZESS® (linaclotide), the U.S. branded prescription market leader for adults with irritable bowel syndrome with constipation (IBS-C) or chronic idiopathic constipation (CIC). LINZESS is also approved for the treatment of functional constipation in pediatric patients ages 6-17 years old. Building upon our history of innovation, we keep patients at the heart of our R&D and commercialization efforts to reduce the burden of diseases and address significant unmet needs.

Founded in 1998, Ironwood Pharmaceuticals is headquartered in Boston, Massachusetts, with a site in Basel, Switzerland.

We routinely post information that may be important to investors on our website at www.ironwoodpharma.com. In addition, follow us on X and on LinkedIn.

About LINZESS (Linaclotide)

LINZESS® is the #1 prescribed brand in the U.S. for the treatment of adult patients with irritable bowel syndrome with constipation (“IBS-C”) or chronic idiopathic constipation (“CIC”), based on IQVIA data. LINZESS is a once-daily capsule that helps relieve the abdominal pain, constipation, and overall abdominal symptoms of bloating, discomfort and pain associated with IBS-C, as well as the constipation, infrequent stools, hard stools, straining, and incomplete evacuation associated with CIC. LINZESS relieves constipation in children and adolescents aged 6 to 17 years with functional constipation. The recommended dose is 290 mcg for IBS-C patients and 145 mcg for CIC patients, with a 72 mcg dose approved for use in CIC depending on individual patient presentation or tolerability. In children with functional constipation aged 6 to 17 years, the recommended dose is 72 mcg.

LINZESS is not a laxative; it is the first medicine approved by the FDA in a class called GC-C agonists. LINZESS contains a peptide called linaclotide that activates the GC-C receptor in the intestine. Activation of GC-C is thought to result in increased intestinal fluid secretion and accelerated transit and a decrease in the activity of pain-sensing nerves in the intestine. The clinical relevance of the effect on pain fibers, which is based on nonclinical studies, has not been established.

In the United States, Ironwood and AbbVie co-develop and co-commercialize LINZESS for the treatment of adults with IBS-C or CIC. In Europe, AbbVie markets linaclotide under the brand name CONSTELLA® for the treatment of adults with moderate to severe IBS-C.

Contacts

Company:
Greg Martini
Chief Financial Officer
gmartini@ironwoodpharma.com

Investors:
Precision AQ (formerly Stern Investor Relations)
Stephanie Ascher
Stephanie.Ascher@precisionaq.com

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