Ironwood puts GERD hopeful on the chopping block along with 100 staffers after flop

ax in a tree stump
(Markus Spiske)

Ironwood had once hyped this drug as a $2 billion-a-year asset, but IW-3718 has failed to live up to its high expectations, failing a phase 3 program and thrown out onto the garbage pile.

Things looked shaky three years ago when the drug, then in midstage testing, met its primary endpoint, but not by much, and investors questioned the drug’s future.

RELATED: Ironwood slips as heartburn data underwhelm investors


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Ironwood vowed to still take the drug into pivotal late-stage trials. Data for one of these two identical tests are out today, but it’s grim reading: IW-3718 in refractory gastroesophageal reflux disease (GERD) “did not meet the pre-specified criteria associated with a planned early efficacy assessment,” the company said in a statement.

Its primary endpoint was to see it hit a statistically significant improvement in heartburn severity. Given this flop, the whole program including its second ongoing phase 3 will now be scrapped.

And so too will 100 workers, making it 35% of the company, to save cash: $95 million by its estimates.

The cuts are “expected to affect both field-based and home-office employees, including the relevant general [and] administrative support functions.”

This will slim it down to around 210 full-time employees, and follows a similar fate to its spin-off company Cyclerion Therapeutics which a year ago saw two midstage flops that also forced the company to wield the ax on staffers.

It will also restructure its commercial biz, focused around its FDA-approved IBS drug Linzess (linaclotide) to “focus primarily on gastroenterologists where Ironwood has strong, established relationships and a demonstrated ability to educate and impact treatment decisions.”

This comes after the MD-7246, a delayed-release formulation of Linzess, failed a midstage test back in May, leaving Ironwood and partner AbbVie to also ditch further work on the program. This now leaves the biotech, which split in two a few years to focus in on R&D, with no remaining clinical pipeline meds.

RELATED: Ironwood spinout nosedives, plots layoffs after twin phase 2 fails

“The outcome of this assessment is deeply disappointing for Ironwood and for patients, given the large unmet need among patients with refractory GERD for an alternative to standard treatment options,” said Mark Mallon, chief executive at Ironwood.

“IW-3718-302 was a robust and well-conducted phase 3 trial, and while we plan to conduct a complete analysis of the data set, we believe these findings are definitive. We extend our gratitude to the patients, investigators and their staff and the entire Ironwood team who played a critical role in advancing IW-3718.”

Shares were down 8% Tuesday on the news.

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