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Ironwood (IRWD) Q4 Loss Narrower than Expected; Sales Top
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Ironwood Pharmaceuticals, Inc. (IRWD - Free Report) reported an adjusted loss of 12 cents per share in the fourth quarter of 2016, narrower than the Zacks Consensus Estimate of a loss of 23 cents but slightly wider than the year-ago loss of 11 cents.
Total revenue (collaborative revenues) in the quarter amounted to $87.4 million, up 65% from the year-ago period and also above the Zacks Consensus Estimate of $80.79 million.
A look at Ironwood’s share price movement shows that the stock has outperformed the Zacks classified Medical - Drugs industry this year so far. Specifically, Ironwood gained 12% during this period, while the industry rose 6.9%.
The Quarter in Detail
Ironwood’s sole marketed product, Linzess generated U.S. net sales of $173.6 million, as reported by partner Allergan plc , up 5.6% sequentially and 34% year over.
Ironwood and Allergan share equally in brand collaboration profits or losses. Ironwood's share of the net profits from the sales of Linzess in the U.S. (included in collaborative revenues) was $62.8 million in the fourth quarter, up 27.4% from the year-ago quarter.
According to data provided by IMS Health, Linzess prescriptions filled during the quarter crossed 728,000, up 24% from the year-ago period.
New patient additions, broad payer access and continued demand are driving sales and prescription growth of Linzess.
Linzess is currently approved in the U.S. for the treatment of adults with irritable bowel syndrome with constipation (IBS-C; 290 mcg) and chronic idiopathic constipation (CIC; 145 mcg). Ironwood and Allergan are looking to broaden Linzess’ label by expanding the targeted patient population and gaining approval for additional indications.
In January this year, the FDA approved a 72 mcg dose of Linzess for the treatment of adults with CIC. The new dose is expected to be available in the first quarter of 2017. Approval for this lower dose strength would boost prescriptions in the large, heterogeneous adult CIC patient population. Meanwhile, in Dec 2016, Ironwood also announced positive top-line data from a phase IIb study evaluating a colonic formulation of Linzess. Data from the study showed that the colonic formulation led to improvements in pain relief over Linzess, supporting the advancement of the colonic formulation to phase III development in 2017.
Allergan has a deal with Astellas for Linzess in Japan. In China, Hong Kong and Macau, Ironwood has an agreement with AstraZeneca plc (AZN - Free Report) for Linzess. Linzess received approval for IBS-C indication in Japan in Dec 2016 with expected launch in the first half of 2017. The regulatory approval triggered a $15.0 million milestone payment from Astellas that was recognized as revenues by Ironwood in the fourth quarter of 2016. Meanwhile a regulatory filing has been submitted in China for IBS-C.
Zurampic, Ironwood’s second commercial product, for the treatment of uncontrolled gout, was launched in Oct 2016.
Zurampic brought in sales of $0.1 million in the quarter. Zurampic prescriptions filled during the quarter were 371. At the call, management said it expects slow uptake of the drug for the first 12 months and sales will be nominal as it works on educating physicians and patients as well as secure payer access.
This year, Ironwood expects to launch Duzallo, the fixed-dose combination of Zurampic and allopurinol. The new drug application for Duzallo was accepted by the FDA for review in January this year. The PDUFA date is expected in the second half of 2017 with the drug expected to be launched in late 2017. If approved, Duzallo would become the first dual-mechanism treatment for patients with uncontrolled gout.
During the reported quarter, selling and administrative (SG&A) expenses were up a significant 75% to $55.2 million primarily due to investments for the launch of Zurampic.
Research and development (R&D) expenses were $38.4 million, up 39.1% from the year-ago period due to costs associated with pipeline development.
2016 Results
Full-year sales improved 83% to $274.0 million (collaborative revenues), beating the Zacks Consensus Estimate of $264.59 million.
Adjusted loss per share was 55 cents in 2016, narrower than the Zacks Consensus Estimate of a loss of 70 cents per share as well as the year-ago loss of 93 cents.
The company said that backed by financial discipline, it used approximately $25 million for operations in 2016, lower than its guidance of less than $50 million provided at the third-quarter conference call.
2017 Guidance
The company now expects to use less than $100 million for operations in 2017, much higher than 2016 levels given the full-year of commercial expenses related to the launch of Zurampic and to support the launch of Duzallo and pipeline advancement.
R&D expenses and SG&A expenses are expected in a range of $145–$160 million and $235–$250 million, respectively.
Total marketing and sales expenses for Linzess are still expected to be around the mid-to-high end of the $250–$280 million range.
Ironwood Pharmaceuticals, Inc. Price, Consensus and EPS Surprise
Shares of Summit Therapeutics rose 60.6% in the past one year while loss estimates for 2017 have narrowed by more than 6% in the past 30 days.
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Ironwood (IRWD) Q4 Loss Narrower than Expected; Sales Top
Ironwood Pharmaceuticals, Inc. (IRWD - Free Report) reported an adjusted loss of 12 cents per share in the fourth quarter of 2016, narrower than the Zacks Consensus Estimate of a loss of 23 cents but slightly wider than the year-ago loss of 11 cents.
Total revenue (collaborative revenues) in the quarter amounted to $87.4 million, up 65% from the year-ago period and also above the Zacks Consensus Estimate of $80.79 million.
A look at Ironwood’s share price movement shows that the stock has outperformed the Zacks classified Medical - Drugs industry this year so far. Specifically, Ironwood gained 12% during this period, while the industry rose 6.9%.
The Quarter in Detail
Ironwood’s sole marketed product, Linzess generated U.S. net sales of $173.6 million, as reported by partner Allergan plc , up 5.6% sequentially and 34% year over.
Ironwood and Allergan share equally in brand collaboration profits or losses. Ironwood's share of the net profits from the sales of Linzess in the U.S. (included in collaborative revenues) was $62.8 million in the fourth quarter, up 27.4% from the year-ago quarter.
According to data provided by IMS Health, Linzess prescriptions filled during the quarter crossed 728,000, up 24% from the year-ago period.
New patient additions, broad payer access and continued demand are driving sales and prescription growth of Linzess.
Linzess is currently approved in the U.S. for the treatment of adults with irritable bowel syndrome with constipation (IBS-C; 290 mcg) and chronic idiopathic constipation (CIC; 145 mcg). Ironwood and Allergan are looking to broaden Linzess’ label by expanding the targeted patient population and gaining approval for additional indications.
In January this year, the FDA approved a 72 mcg dose of Linzess for the treatment of adults with CIC. The new dose is expected to be available in the first quarter of 2017. Approval for this lower dose strength would boost prescriptions in the large, heterogeneous adult CIC patient population. Meanwhile, in Dec 2016, Ironwood also announced positive top-line data from a phase IIb study evaluating a colonic formulation of Linzess. Data from the study showed that the colonic formulation led to improvements in pain relief over Linzess, supporting the advancement of the colonic formulation to phase III development in 2017.
Allergan has a deal with Astellas for Linzess in Japan. In China, Hong Kong and Macau, Ironwood has an agreement with AstraZeneca plc (AZN - Free Report) for Linzess. Linzess received approval for IBS-C indication in Japan in Dec 2016 with expected launch in the first half of 2017. The regulatory approval triggered a $15.0 million milestone payment from Astellas that was recognized as revenues by Ironwood in the fourth quarter of 2016. Meanwhile a regulatory filing has been submitted in China for IBS-C.
Zurampic, Ironwood’s second commercial product, for the treatment of uncontrolled gout, was launched in Oct 2016.
Zurampic brought in sales of $0.1 million in the quarter. Zurampic prescriptions filled during the quarter were 371. At the call, management said it expects slow uptake of the drug for the first 12 months and sales will be nominal as it works on educating physicians and patients as well as secure payer access.
This year, Ironwood expects to launch Duzallo, the fixed-dose combination of Zurampic and allopurinol. The new drug application for Duzallo was accepted by the FDA for review in January this year. The PDUFA date is expected in the second half of 2017 with the drug expected to be launched in late 2017. If approved, Duzallo would become the first dual-mechanism treatment for patients with uncontrolled gout.
During the reported quarter, selling and administrative (SG&A) expenses were up a significant 75% to $55.2 million primarily due to investments for the launch of Zurampic.
Research and development (R&D) expenses were $38.4 million, up 39.1% from the year-ago period due to costs associated with pipeline development.
2016 Results
Full-year sales improved 83% to $274.0 million (collaborative revenues), beating the Zacks Consensus Estimate of $264.59 million.
Adjusted loss per share was 55 cents in 2016, narrower than the Zacks Consensus Estimate of a loss of 70 cents per share as well as the year-ago loss of 93 cents.
The company said that backed by financial discipline, it used approximately $25 million for operations in 2016, lower than its guidance of less than $50 million provided at the third-quarter conference call.
2017 Guidance
The company now expects to use less than $100 million for operations in 2017, much higher than 2016 levels given the full-year of commercial expenses related to the launch of Zurampic and to support the launch of Duzallo and pipeline advancement.
R&D expenses and SG&A expenses are expected in a range of $145–$160 million and $235–$250 million, respectively.
Total marketing and sales expenses for Linzess are still expected to be around the mid-to-high end of the $250–$280 million range.
Ironwood Pharmaceuticals, Inc. Price, Consensus and EPS Surprise
Ironwood Pharmaceuticals, Inc. Price, Consensus and EPS Surprise | Ironwood Pharmaceuticals, Inc. Quote
Ironwood carries a Zacks Rank #3 (Hold). A stock worth considering in the drugs sector is Summit Therapeutics plc (SMMT - Free Report) with a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares of Summit Therapeutics rose 60.6% in the past one year while loss estimates for 2017 have narrowed by more than 6% in the past 30 days.
Zacks' Top Investment Ideas for Long-Term Profit
How would you like to see our best recommendations to help you find today’s most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>