IRWD - Earnings call transcript Q4 2021 | Ironwood Pharmaceuticals, Inc.

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Operator

Ladies and gentlemen good morning. My name is Abbey and I will be your conference operator today. At this time, I would like to welcome everyone to the Ironwood Pharmaceuticals Fourth Quarter and Full Year 2021 Investor Update Conference Call. Today’s conference is being recorded and all lines have been placed on mute to prevent any background noise. After the speaker’s remarks, there will be a question-and-answer session. Instructions]. [Operator like Roache, would Investor Director introduce Relations. to I the Matt of And Mr. begin conference. you your Roache, may

Matt Roache

Thank Good XXXX our fourth you us quarter joining Abbey. and morning and full year investor for update. thanks for

Statement on Such A Form crossed actual Harbor the results a forward-looking may as which accompanying morning as of of be in substitute to the September speak on only and call comparable Our the and the press in discussion under these heading risks our well quarter SEC be forward-looking our refer and wire Today's GAAP and press statements. risk of release most such the of website. undertake obligation All end to these measures, include the at future available release the please the presentation, as cause for our materially. To involve and to this can differ this Safe supplement Also found statements statements slides to as filings. is our financial measures. factors measures to will not date directly statements. current quarterly reconciliations applicable, non-GAAP tables XX-Q no update we of extent that ended slide and or Risk GAAP Factors XXXX, report XX, and to on for considered a are superior for the included measures. statements uncertainties

an webcast pipeline; our Chief Officer Medical review of results an Mike our During will our will with Financial These commercial update includes provide today's guidance. begin provide overview on an Tom the update Chief LINZESS. Sravan call, and performance and will CEO, our slides. McCourt, Shetzline, financial Emany, on Officer, our

Events those Tom. I you go call slides. the access in, turn accompanying of the will of to With to that, dialing website section our the to please For over

Thomas McCourt

last LINZESS; important CEO I treatment high of who need energized the work for joining XXXX and unmet strategic progress started lot we thanks map, three out solutions the year, to dedication, year in pandemic closed commitment road us maximizing three, across the these included in report to clear about this generate today. innovative hard with XXXX, Thanks, strengthening to of the redefining commitment patients. their became morning, for with made be we Thanks three sustained which innovative standard proud GI two, of. XXXX, advancing a GI we In and to tremendous everyone a area one, I'm ongoing priorities: flow. Good care developing I and all GI. Matt. and When and even deliver cash profits was By key the made pillars. of to pipeline; our their diseases was against I Ironwood end significant of the resistant am headway of through team of mission. that the excited We proud in

achievements a begin quick of Slide of and XXXX. with X highlights our Let's on some in overview

In billion profitability. resilient, growth been strong Prescription exceeding and that year-over-year. achieved status an to LINZESS market-leading who extraordinarily performance in blockbuster made to brand billion continues the dedication robust $X demand were I'm The acknowledge net reality. XXXX, First, our to deliver LINZESS that commercial achievement growth a a and this X% representing U.S. proud year-over-year, XX%. sales, has share $X continued small in of LINZESS grew XX% and feat demand want sales margins impressive no I of is team

risk to of warning approved that all a announced the advance of for age use the in change under for accomplishment modifying prior FDA is previously addition, revised the of the we a label program. years LINZESS age. children pediatric a This X included to box dehydration serious years the children warning, In contraindication we continue than significant which XX to of and label against team less as

in years the LINZESS currently for approved under patients not XX a of is age. As reminder, use

develop Next, successful with disease-modifying the the we CNP-XXX, strengthened to agreement our for which, commercialize pipeline therapy by entering be and has biliary into license potential and to a if first cholangitis. Pharmaceuticals COUR collaboration approved primary option

addition, treatment elaborate our pediatric wholly updates advanced on in functional owned pipeline program and exciting in these In IBS-C our Mike development we a visceral moments. asset IW-XXXX, few conditions will and pain the for of linaclotide constipation.

cash includes the in the GAAP second Finally, to $XXX million program we benefit at the valuation Board buyback of year income Adjusted as allowance of of with XXXX. $XXX with ended repurchased cash Also, in from end shares of quarter which of $XX XXXX. of non-recurring EBITDA million we the XXXX. a end million net the of in our increase million related share million $XXX authorized and income, release tax $XXX equivalents, significant a a initiated

very and to Business the Officer; we GI Another to that Legal of important in to recently, at grow Monarto, our mission of of and Ironwood, at address new Davis, Officer; of talented Sravan our I'm and Financial to We're highlight our Chief Officer. a in team Emany, experienced Chief XXXX be diseases. areas innovation the Andrew company ushering and thrilled the our leaders and uniquely John look joined Chief have growth our capable was honored advancing pipeline several era Sravan the as and helm group most John leaders, in of Andrew, including a continue addition

continues as success starting turn its tremendous to to blockbuster from X. on of Slide let's had to backbone our attention has its serve company. and recent the the achievement Now Ironwood inception with of LINZESS LINZESS, status, it

in few resulting with new a sales year ended share, ago, over XXXX, demand U.S. total moments net XX% of the the record year-over-year brand. LINZESS prescription billion. $X for prescription LINZESS XX% increased in approximately high mentioned I a As

you see growth year-over-year, market. Slide robust As new-to-brand prescription outpaced on the a can which XX% increased X,

as of of the continued business increase In end prescription the up addition, XX-day to growth making approximately of time, XXXX. has over XX%

blockbuster It's by happen it doesn't brand Turning exit. that not and status Slide X. to every achieves a day

demonstrated IBS-C by frustrated First, improvement constipation LINZESS bloating, in for discomfort. symptoms, pain, abdominal in and which often plus important overall is were an adults the treatment has with

LINZESS Additionally, the and constipation treatment marketing growth This market chronic has brand for deliver we and gastroenterologists position and while prescribed and strong enabled become us brand mix care strong robust adults the branded momentum has and number refine physicians. investment overall leadership margins. awareness with by primary time, continue expand to one IBS-C over our demand to helped

continue to LINZESS opportunities. by payer to activation, patient promotion, our cycle refined and through expect management We future life access, professional class-leading grow pursuing

XXXX company see our to delivering capabilities millions firsthand, well Ironwood I'm affected value in our organization position shareholders. the and outstanding will team honored development the in on I'll our XXXX continuing to we our beyond. believe Mike to our advancing of our and GI plan the build to level in confident in for as in and very of company forward look and to of will commitment I diseases. difference Ironwood's and lead patients people, as of in success the and over pipeline future, strategies unsurpassed long-term brand discuss positive this our joining ahead, patients to a by efforts. we're Looking for making call full talented strategy the the to clinical turn pipeline continue Since development we're upon We now as commercialization making Mike? to growth. and investments we focus I the and for

Michael Shetzline

Thanks, advance large prescription of believe therapies that expanded bring no we GI patient this Tom. pipeline million start FDA-approved excited impact of I'll the We're currently functional a we read pediatric way. estimated first-in-class expect the are can and think our with thrilled as year. diseases clinical is X for on opportunity from second X to to to We disorders this half the meaningful clinically to in this constipation to functional to to that population. we there We're patients LINZESS new U.S. study in olds to utility a potentially year Functional therapies XX we and we constipation have olds in in the significant X pediatric seek linaclotide X continue expand suffering XX potentially year Slide to constipation. the to million, XX. affects an and this out program, program

limited altered be cross-talk will first year. Cross-talk known originating to one offer to colon in million through available about number study sensation Interstitial date IW-XXXX. such the as nerve pleased The guanylate endometriosis. Next of X patient for opportunity to to the a Interstitial this test agonist foundation is nearby officially wholly supports is and an this phenomenon as bladder pain it a options owned cystitis an These quality particularly I'm launch in because visceral a and our bladder cystitis, hypothesis update mechanism sensations benefit result the in for underway. conditions, pain a to syndrome life. in CKC where affect or according treatment asset excited for cross-talk. overlapping other can XX Americans impact the and a a have is pathways. evidence is We're injury syndrome, diseases X to of visceral IW-XXXX clinical that organs of acting interstitial IW-XXXX in scientific organ biological to Cystitis share of Phase of organ the the visual pain time the on significantly pain and a Association. treatment abdominal potential study as clinically the of estimated million humans the later

that Next, pleased CNP-XXX, XXXX. COUR clinical hepatology a of of gaps PBC efficacy discuss treatment. in secretion designation We're to experts and leading the damage, We for primary and as the tolerability, FDA, in substances our in pipeline. continuous can duct biliary signing the and where strategic share transplant. on also identify which Apparently, toxic readout affects by to agreement with decreased in medical and enhancing cause study PBC. the COUR, to loss Since currently of and expected underscoring in pharmacodynamics, CNP-XXX recently help initiated CNP-XXX. a leads that of pathology the patients success. novel U.S. has we existing rare require external has The significant look granted addresses liver, in of ultimately at leverage to fundamental virtual of no which bile symposia and patients, hepatic been resources unmet disease prime and collaborate cholangitis, the is U.S. is PBC approach partners to of approved thrilled there's or a bile we which treatments to We're autoimmune therapy our disease progressive XXX,XXX to opportunities advance tapping expertise root debilitating We're into to bile example estimated is that for the with slowly our can liver GI duct resulting and will the fast-track meaningfully COUR safety, care impact an need CNP-XXX the gastroenterology this the the with a GI people participated in PBC. drive in underlying destruction with retention liver to

gastroenterologists During this highlighted of this duct is progression who of forum, foundational importance PBC the treat the stopping leading destruction and many to that liver hepatologists bile disease.

game has within This COUR's really over patients unmet our commercial real We program. CNP-XXX you efforts the programming strength highly And assets focus PBC. this with the that help this treatment plan shift collaboration to of believe So method be pipeline. this see are action, more reach to differentiated, differentiated turn established program. clinical and disease advance our as GI relationships to can points. the condition, review first financial it forward; GI this with development how will deep we're in like expertise medical now exciting opportunities. allows as via and Ironwood's our and changer and successful development community, we we build is Sravan clear And going I'll out believe we're performance. our to on therapy an potential clear a pipeline, excited have well area assets as PBC seeking further leverage advance provide this and COUR innovation needs, target immune us for decision identify could to our business why to suffering in for in potentially expand the truly We about disease-modifying if paradigm and the

Sravan K. Emany

everyone. good of team to excited and here at morning, I'm part Mike and a Ironwood a team, Thanks, such great great be culture.

to fantastic Ironwood report and As I over past few how few like see position strengthened the years. updates. financial its much would to CFO, is the numbers provide a it great such has new

over fourth were financial in the allocation First, strategy and quarter XXXX. the full will press of I'll quarter then U.S. review Please slight year capital refer fourth for discuss performance, XXXX I information. to release Slide will our I'll detailed XXXX, highlight finally, fourth with a our on start quarter XX increase XXXX guidance. our net our I and LINZESS. $XXX our million sales of

a fluctuations half XXXX, sales favorable resulted dampening in which in which second the we growth the in the net As in a saw fewer resulted growth inventory sales year half. channel first net of reminder, in of

we forward, levels expect Going XXXX. channels to similar quarterly inventory

For sales year full full billion, an demand. were by robust year mostly Growth driven XXXX. $X.X XXXX, was X% LINZESS compared net to U.S. increase prescription

in Turning XX%. to quarter the LINZESS fourth brand commercial profitability, margin XXXX was of

margins XXXX. year for versus For XXXX, year were full XX% commercial XX% full

Ironwood to quarter, Moving were In million. revenues. Ironwood $XXX the fourth revenues

tax second million. year, recorded full $XXX quarter of revenues fourth of was for tax the our compared XXXX, XXXX. option Adjusted U.S. GAAP which was associated for in net XXXX year the full relating year $XX.X against in EBITDA our were LINZESS million, benefit a LINZESS release includes of nonrecurring EBITDA million the million, assets. million includes majority which For collaboration deferred XXXX, collaboration $XX $XXX income of full the of the year agreement. income million Ironwood increased in XXXX. Ironwood $XXX and the COUR $XXX quarter to which allowance revenues fourth of quarter expenses U.S. was the to million with with was in $XX $XXX million X% revenues Adjusted full valuation

year are $XXX million that XXXX, and cash and the in quarter, being cash is XX, biotech in full at fourth In flow up priorities from Slide generated we flow. the the with cash meaningful company and ended year capital cash unique of we to and position Moving delivering a on equivalents, $XX $XXX end allocation cash in the million $XXX million a for of operations from XXXX. million profitable

authorized end to repurchase through million of share this execute $XXX the Board year. of We up that continue program our to runs

J.P. February are shares highly as January, Morgan announced and the through differentiated of innovative, XX, growth an repurchased success of assets Conference $XX company $XX December million bolster portfolio. of our in we believe future repurchased common additional previously for shares our positioning our As pursuing LINZESS mentioned we XXst. XXXX. we at by maximizing and GI We million stock actively of Healthcare And to

shareholders focused and disciplined approach in the over to and create remain capital long balanced we We for continue and a that take to patients deployment identifying term. believe on will opportunities and value investing our

our review on I'll Slide guidance Next, XXXX XX.

Ironwood double-digit the net refine in we to support low LINZESS stated We again previously maximize Over maintain demand cash demand growth, access, investment we growth. an expect result single-digit and improve As flow. January, payer price will in In this prescription we we we brand single digits. high sales continued growth anticipate time, XXXX, in made continued brand erosion year. which margins, anticipate the in to have ultimately broad to our investment

to be expect XXXX. We erosion price manage more to in modest

Next, EBITDA to expect we And expect of total than $XXX million. million adjusted Ironwood lastly, we $XXX of revenue $XXX million. greater

leading forward, management GI as XXXX, a potential coupled patients us leading pediatric IW-XXXX, it our we confidence to initiating balance we and repurchase grow skilled share blockbuster driving with CNP-XXX, carrying in in adding pleased successfully that and a position status, can team, us are game-changing progress LINZESS States. ability potentially assets With advancing pipeline, a help as to for asset this with make United current linaclotide our to sheet in pursue made company will and and our you help then new see, the So our the difference our we GI program have healthcare momentum program. growth,

us, for up now the progress. about line the posted work our we'll questions. open you keep and excited to you Operator, of are continue We may on ahead

Operator

Boris first Instructions]. from question we Cowen. with Peaker Thank take will our And [Operator you.

Boris Peaker

morning. to this discuss kind data data? data update drug considering XXXX, you should any that you later can and this drugs this the in in what Question on Good to looking at see further of we're need year or be reference sets invest reference we when there are

Sravan K. Emany

this over Boris, morning I'll to to Well, that question. hand good answer is Mike it Sravan.

Michael Shetzline

Yes, sure.

as a undertaking we're significant for a kick to actually, started again, medical The quarter XXXX. it's the It's because program. in XXXX, need. one, So we clinical off well-established excited very said, program,

complete to going XXXX point, to So X Phase through the your we're program.

tolerability do data proof-of-concept call we this have Phase from available and later the off and plan we'll year. perspective, what to So we X a studies kick safety

that's why get externals worked the study syndrome. well as medical So of actually the a we work information but that design clinical products don't of we a being that But pain is significant. also They opinion. from think on is other today. reasons But bladder from -- analogs, the it's approved that's quite speak we need there and just that one for of in are found couple

those using symptomatic bladder and patients looking to from analogs, their it for really of the improvement But course, well. pain FDA the of we're by is at So of designing program visceral as it the run sort feedback we'll get suffering syndrome. hypersensitivity

Boris Peaker

environment, you in just buyback? question obviously, focused more back be biotech you an shares. pipeline if cash is Got or And down objective curious now it. seem of you this own last to happy the M&A, guys have aggressive new buying come significantly, with are returning your quite shareholders you my more actively revaluated via to with are I'm have on right just being valuation that the is

Sravan K. Emany

Part in of again, I the whatever an down but that we'll that's our we're to makes with to open we creates deploying it's of pretty we for that interest we're find sense Yes, think shareholders. opportunity opportunities, think thanks best when finding that future actively those it. for think or sense going think that it whether us, a where for our and makes I acquisitions times stand of part from capital Boris. value, pursue allocation And comes disciplined repurchasing Look, own be I to we've we capital today, few now strategy, shares. said

Thomas McCourt

is Boris, our A of Yes, this Tom. too. couple thoughts,

of thing really LINZESS to ability our think mix is bigger and the of continue the bottom of line, concept unmet And game us through to would And the area the been is to which and to kind like a changer we able set assets on significant the continue its to to is that and I we the that, get the that's need of classic excited to going be I bring drop and proof be a in for to think high whether invest future. of treatment. resilience really for CNP-XXX a the example numbers board really to marketing investment to me remarkable determine up refine future. potential

we're excited where about right very So we now. are

I think track. about just done kind right where of has job team I and the a years three us ago really strong on we were the think in getting

Boris Peaker

thank for taking Great, you very questions. my much

Operator

will J.P. from Morgan. next we Joseph take Eric And with our question

Eric Joseph

Hey, morning questions. for guys. good Thanks taking the

share to picking constipation Just Any functional be OTC color or with sense children that of the might have pediatric X many the up how are children willing terms which be here, of of a with type managed that or in with constipation? expecting that within children on are laxatives uptake you you currently extent you'd to patients the around -- opportunity. you're do setting functional million

Sravan K. Emany

your then to Eric hand Yeah, thanks Tom I'll and good Mike. morning it question. for and

Thomas McCourt

currently really really options as Mike pediatric approved can not I is there's what in kids. what nothing IBS. with for mentioned mean, you of I market for research or many in kind good constipation the this earlier, actually learned reality there's Yes. And and space share we've is

the these as one think quickly. and a care think physicians I here. gastroenterologists can is this by probably are of adolescent actively very a seeking population, visible which both we These I access treated they're high-need patients that as market; primary well the of sizable pieces there's couple population lot to -- most is

this is kind this is And of and regard I opportunity. Mike, help. maybe you when to suffering, a view and think step to a they're kids I difference in of improve population. forward approved huge for but the the symptoms, think only the not further your engaging can are constipation have also comment that's one population symptoms abdominal improve actually actively these can your for physicians clinical with drug need

Michael Shetzline

think significant out is and we're year Yes, constipation of in patients studying one the the for the that the is study is morbidity will key similarly, general later in be primarily XX I populations X this that a medical year olds. to and actually

IBS-C They and I So conditions alternatives the or prevalent perspective from they're know, perspective, have mentioned, is sort laxatives. fairly And don't good IBS perspective approved. a currently really functional constipation as with pediatric constipation rotate of from population. in nothing they as an you through

So a frequency with in because population see the that's year why patients this end population. the provide in functional forward, really the this to patient bowel good X symptoms at moving could therapy data excited we're with patients constipation to improving of of XX-year-old for in real

Thomas McCourt

launch the there's closing as in make what the well clinical a as this, of opportunity. FDA in a many resolved what and kind question when that drug safety we hypothesized of we team, I other population importantly, the due direction. to his with as Mike this those data to One well work thought work basic far like regard but right going they've do science effective going tolerated. as But sure very younger it's in and Speakers] continue far the really the more been as hard commercial Eric, as of drug to [Multiple concerns, was sizable always in to this We're this both seeing with the that see to we're look mentioned does drug, and

Eric Joseph

the was whether for -- data is be to, really powered terms help which Mike, the the purposes [indiscernible] of positive is set study expansion? to those for used in the a for what that might label to in what -- trial the improvement trying side, in I is and expectations of go readout second just total the little get more to be premium half,

Michael Shetzline

diagnosed bowel XX-year-old to the at functional function in is X to study, obviously so which Yes, a study, looking improving looking with at XX-year-olds X constipation. current it's --

Bowel other in the with founded in bowel improvement level of disorders, measurements, bowel spontaneous they're function. constipation us function sort that an what those as seeing frequency, movement that path see to at of agency the to for obviously constipation. functional have the and be to we'll the that earlier with the end actually improvement in for a in patients. that's the an got looking year prepare And that, and So endeavor movement movement will we're Clearly, with this hopefully end it give indication data points in and to year, agency for really we've at discussion discussions will move forward. bowel data-driven

Eric Joseph

Okay, margin if XXXX, talked Strong that How I great. commercial exited thinking franchise, any fourth should be be question, anticipating? trend Final the could. we additional margin for commercial should earlier for of guess quarter. I you diminishment sort LINZESS of we about spend in the about

Sravan K. Emany

for so At and step a years we're XX double-digit company. growth the demand prescription of overall its manage And just and a it the payer spend brand first ultimate we've in a I profile cash year-over-year, life all, been proud to to as Eric, little make commercial and made me choices flows growth. perspective we had those and thriving a talked of back, produce some ultimate driver cycle. terms that's to think where look, mentioned, take maintain profitability LINZESS of that. we that goes marketing, prudent let is to time, terms think driver either earlier, same just in of to investments able what Because where well drive from access, demand about our say that's and of Tom prescription into the really pretty Yes, overall of having in into as etcetera being we've

be inflationary environment, that exposed CFO, economy, an our inflation say other the I think labor And every that's right. the Specifically, and I look, to your business, what question whether in broader mention repressions if is, wanting like. we're didn’t like I'd we're would like within to

we from to that. from going And about think and containment. drive for a But think profitability margins continue to steady I stand XXXX we're at where where monitor cost commercial so to we're today continue perspective, hold through we we

Thomas McCourt

Yes.

Just one thanks Sravan. other,

up brand seen you momentum we other the one I as promotion, talked back biggest Just allowed on about to really that items market, which And know, is the of as one this has is, the tune pulled we comment expense, think and this ticket has to we marketing mix. which effectiveness in says personal the the us promotional dramatically haven't with growth. this have of regard to about also consumer important, demand drug marketplace easily continued at obviously, we the But ongoing the has in mix response. critically growth the patients waiver to and professional side. both at the and look for look which course, on We of is which a payer continue the lot drug. access And to investment enable the

Eric Joseph

guys the Thanks questions. taking for Excellent.

Operator

Tim Northland And we Securities. will Chiang take our question from with

Timothy Chiang

that you products infrastructure have in have a just the Tom, complement Hey given already given of biotech approved the Thanks. considered commercial a pharma fact revaluation lot just existing names, in you guys looking place? LINZESS, other at

Sravan K. Emany

open say Look, that this activities look, I on saying So start development comment we Tim, I'll as What by is, a don't Sravan. standard that company, of will is evaluate any strategic that are direction can and we course. a opportunities business will the from creates for us. most value drive think of all amount we for the to and perspective we whatever

So it's but we're to answer what a are that, appreciate question, going about broad and specific your looking where at. I we to not get

Thomas McCourt

Yes. just, mean agree. I I I mean,

which opportunities looking of right Tim. is is and is this different changing, the now, team lot a for nice things -- environment create at think could the us I

investor. evaluating opportunities as Board making sure closely working an that we're in us critically of our very that number I with of think for we're a have front make to you and we sound decisions

Timothy Chiang

a follow-up. And maybe great. just Okay,

you is or I -- to think know -- for type guys I this have which of guidance, up which year on you ramp of Just flat expenses it is XXXX expect R&D? more But, guys R&D provided a solid. do year

Sravan K. Emany

Yes.

a in first reminder, one, give XXXX with -- guidance in step to respect of don't a as R&D year R&D XXXX expenses, just expenses. So taking last on back, all, Tim, we

$XX.X that costs we're the the we've to got I XXXX the But on license associated million included things progress EBITDA. pediatrics is itself. say those and one. our XXXX. COUR At year, and time, in on first We some about same recur would just talk R&D to expect get interesting looking we don't is readouts about specifically agreement, what the making this I'm and option think, sorry, I with CNP-XXX expense we're IW-XXXX

on I'd have recurring those So don't guidance that we costs don't and say just we provide that.

Timothy Chiang

Okay, Thanks. great.

Operator

we'll from our with And Jacob Wells Fargo. next take question Hughes

Unidentified Analyst

Hey it's taking Jacob. for good on morning, question. Thanks for Nick the

share this progress Is expect maybe into on from year? there can the you OTC and update you any what us. Just one LINZESS pathway

Sravan K. Emany

At we we Well, an don't on thanks time, update for one. have provide the OTC have this we'll pathway and question. when update an the

Thomas McCourt

I think Sravan. would with And of comment, that's through that. and feasibility spot we're obviously, to working at the our still timing Yes, just look partner that, I on,

So move focused have outstanding FDA getting -- now, assessment. on we're safety with before right that even any resolving on forward may program pediatric drug forward moving and the primarily OTC really questions we can the the

Unidentified Analyst

Got it, thank you.

Operator

And participation, may and that appreciate We session. concludes question-and-answer and your today's this concludes now do ladies disconnect. gentlemen, And call. conference you also our

Ironwood Pharmaceuticals (IRWD) 17 Feb 222021 Q4 Earnings call transcript