Entrepreneurial pharmaceutical company,
Ironwood Pharmaceuticals, Inc.
) recently announced that it has completed the offering of $175
million Linaclotide PhaRMA 11% notes. The note will be due on or
before June 15, 2024 with quarterly interest (11%) paying tenure
beginning on June 15, 2013.
Principal amount of the notes will be paid quarterly from March
15, 2014. The amount of principal paid will be the difference
between 7.5% of net US sales of Linzess (linaclotide) in the
preceding quarter and accrued and unpaid interest on the notes.
The placement agent for this transaction was
Ironwood Pharma intends to use the funds from the transaction to
support the commercial launch of its lead product Linzess. The
net proceeds will also be used to fund its research and
development (R&D) expenses.
We note that Ironwood Pharma and partner
Forest Laboratories, Inc.
) are co-promoting Linzess in the US. Linzess is approved by the
US Food and Drug Administration (FDA) in August 2012 for the
treatment (once-daily) of adults suffering from irritable bowel
syndrome with constipation (IBS-C) or chronic idiopathic
In the EU, approval came in November 2012 under the trade name
Constella. Ironwood Pharma is collaborating with Almirall, S.A.
in the EU for the drug. Ironwood Pharma is also working with its
) for the development of linaclotide in Japan and other Asian
Currently, we have an Outperform long-term recommendation on
Ironwood Pharma. The company carries a Zacks #1 Rank (Strong Buy)
in the short run.
Other Zacks #1 Rank stocks include
Valeant Pharmaceuticals International, Inc.
) and Astellas Pharma.
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