Ironwood Pharma to split out new rare diseases business

3 May 2018

Ironwood Pharmaceuticals’ (Nasdaq: IRWD) shares climbed 5%, to about $19 apiece, in midday trading on Tuesday, after it announced that its board of directors has authorized an intent to separate into two independent, publicly traded companies (Ironwood and “R&D Co”). The separation is expected to be completed in the first half of 2019 and is anticipated to be tax-free to Ironwood shareholders.

Following the separation, Ironwood anticipates being a profitable company, building on its commercial success to-date to accelerate growth of its in-market products and advance development programs targeting treatments for gastrointestinal (GI) diseases, uncontrolled gout, and abdominal pain.
R&D Co will harness the pioneering work in cyclic guanosine monophosphate (cGMP) pharmacology to advance an innovative sGC pipeline expected to focus on the treatment of serious and orphan diseases, led by Phase II clinical compounds praliciguat and olinciguat (IW-1701).

The moves come after activist investor Alex Denner of Sarissa Capital said he was seeking a board seat. Mr Denner said in an interview Tuesday he supports the moves, but is still seeking the seat, according to a CNBC report.

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