Rare Daily Staff
Ironwood Pharmaceuticals said it will split into two independent, publicly traded companies with one company focused on its commercial products for gastrointestinal diseases and the other its development pipeline for serious and rare diseases.
The company said it expects to complete the separation in the first half of 2019. Following the separation, Ironwood said the commercial company is expected to be profitable in the beginning of 2019.
The rare disease-focused company will work to advance the company’s work in cyclic guanosine monophosphate, or cGMP, pharmacology. It’s most advanced compounds are in mid-stage clinical testing for sickle cell disease and achalasia, as well as diabetic neuropathy and a form of congestive heart failure.
The decision follows a strategic review started last year, but it also comes as Ironwood told shareholders that biotech activist investor Alex Denner of Sarissa Capital wanted a seat on the board of the company.
“Today’s announcement marks a transformative milestone for Ironwood. Since our founding 20 years ago, we have been driven by a simple mission: create and commercialize innovative drugs that can change patients’ lives and generate value for our shareholders,” said Peter Hecht, CEO of Ironwood.
The two companies will have separate boards and management teams focused on the strategic priorities, markets, and opportunities of each business. The company said separating the company as planned will allow it to be nimbler, more productive, and enhance its competitiveness.
Both companies will be headquartered in Cambridge, Massachusetts and with the commercial business called Ironwood and the name of the R&D company announced at a later date.
May 1, 2018
Photo: Peter Hecht, CEO of Ironwood