IRWD Stock Down 15% as Q1 Earnings & Revenues Miss Estimates

Ironwood Pharmaceuticals IRWD reported an adjusted loss of 14 cents per share for the first quarter of 2025, which was wider than the Zacks Consensus Estimate of a loss of 5 cents. The company had reported an adjusted loss of 2 cents per share in the year-ago quarter.

Total revenues in the first quarter were $41.1 million, which also missed the Zacks Consensus Estimate of $59 million. Revenues decreased around 45.1% year over year. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

Shares of Ironwood were down 14.6% on May 7 due to the weaker-than-expected first-quarter results.

The stock has plunged 82.1% so far this year compared with the industry’s decline of 4.6%.

IRWD's Q1 Earnings in Detail

As reported by partner AbbVie ABBV, Ironwood’s sole marketed product, Linzess (linaclotide), generated net sales of $138.5 million in the United States, down 46% year over year, as prescription demand growth was offset by price erosion due to Medicare Part D redesign.

Total prescription demand for Linzess increased 8% year over year.

Ironwood and ABBV equally share Linzess’ brand collaboration profits and losses.

Ironwood’s share of net profit from the sales of Linzess in the United States (included in collaborative revenues) totaled $38.8 million, indicating a decrease of 46% year over year.

Ironwood has agreements with two partners, Astellas Pharma and AstraZeneca AZN, related to the development and commercialization of Linzess in Japan and China, respectively.

Astellas and AstraZeneca have exclusive rights to develop and market the drug in their respective territories. Astellas and AZN are liable to pay royalties to Ironwood on net Linzess revenues earned in their regions.

Ironwood recorded $2.3 million in royalties and other revenues in the first quarter, down 28.1% from the prior-year quarter’s figure.

Total cost and expenses (including research and development expenses, selling, general and administrative expenses and restructuring expenses) in the first quarter were $70.3 million, up 10% from the year-ago quarter.

Ironwood recorded negative adjusted EBITDA of $4.7 million in the first quarter. In the year-ago quarter, the company recorded adjusted EBITDA of $21.1 million.

As of March 31, 2025, Ironwood had cash and cash equivalents worth $108.5 million compared with $88.6 million as of Dec. 31, 2024.

2025 Guidance of IRWD

The company reaffirmed its guidance for 2025, which it had provided last month.

The company expects total revenues in the range of $260-$290 million for 2025.

U.S. sales of Linzess (to be recorded by AbbVie) are expected to be in the range of $800-$850 million.

The company expects to deliver an adjusted EBITDA of more than $105 million in 2025.

IRWD's Pipeline Updates

Ironwood initiated the rolling new drug application (“NDA”) submission to the FDA for its next-generation GLP-2 analog, apraglutide, for treating patients with short bowel syndrome (“SBS”) with intestinal failure (“IF”) who are dependent on parenteral support, in January 2025.

Following Ironwood’s recent discussion with the FDA held in April, management noted that a confirmatory phase III study will be required to seek approval of apraglutide for treating patients with SBS-IF.

The NDA filing was expected to be completed in the third quarter of 2025.

However, now that the company would require a confirmatory phase III study for apraglutide approval, the timeline for the NDA filing completion is likely to be extended, which is expected to delay the approval for apraglutide.

The phase III STARS study evaluated apraglutide for reducing parenteral support dependency in adult patients with SBS-IF. The open-label extension study, STARS Extend, also evaluated apraglutide for the given indication.

Management continues to believe that data from both studies will be essential for the NDA submission for apraglutide in SBS-IF.

Ironwood acquired the rights to develop and commercialize apraglutide following the acquisition of VectivBio in June 2023.

Ironwood Pharmaceuticals, Inc. Price, Consensus and EPS Surprise

Ironwood Pharmaceuticals, Inc. price-consensus-eps-surprise-chart | Ironwood Pharmaceuticals, Inc. Quote

IRWD's Zacks Rank & A Stock to Consider

Ironwood currently carries a Zacks Rank #3 (Hold).

A better-ranked stock in the biotech sector is ANI Pharmaceuticals, Inc. ANIP, carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

In the past 60 days, estimates for ANI Pharmaceuticals’ earnings per share have increased from $6.30 to $6.36 for 2025. During the same time, earnings per share estimates for 2026 have increased from $6.85 to $7.14. Year to date, shares of ANIP have rallied 28.2%.

ANIP’s earnings beat estimates in each of the trailing four quarters, with the average surprise being 17.32%.

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This article originally published on Zacks Investment Research (zacks.com).

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