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What changed in IRONWOOD PHARMACEUTICALS INC's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of IRONWOOD PHARMACEUTICALS INC's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+410 added−426 removedSource: 10-K (2026-02-26) vs 10-K (2025-03-31)

Top changes in IRONWOOD PHARMACEUTICALS INC's 2025 10-K

410 paragraphs added · 426 removed · 306 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

103 edited+44 added−23 removed185 unchanged
Biggest changeThe following chart shows our revenue for the U.S. and the rest of the world as a percentage of our total revenue for each of the years ended December 31, 2024, 2023, and 2022. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2024 2023 2022 U.S. 97.1 % 97.8 % 98.1 % Rest of world 2.9 % 2.2 % 1.9 % ​ 100.0 % 100.0 % 100.0 % ​ Revenue attributable to our linaclotide partnerships comprised substantially all of our revenue for each of the years indicated.
Biggest changeWe have pursued a partnering strategy for commercializing linaclotide that has allowed us to focus our commercialization efforts in the U.S. and enabled partners with strong global capabilities to commercialize linaclotide in territories outside of the U.S. 7 Table of Contents The following chart shows our revenue for the U.S. and the rest of the world as a percentage of our total revenue for each of the years ended December 31, 2025 and 2024. ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ U.S. 97.7 % 97.1 % Rest of world 2.3 % 2.9 % ​ 100.0 % 100.0 % ​ Revenue attributable to our linaclotide partnerships comprised substantially all of our revenue for each of the years indicated.
Item 1. Business Our Company We are a biotechnology company developing and commercializing life-changing therapies for people living with gastrointestinal, or GI, and rare diseases. We are focused on the development and commercialization of innovative GI product opportunities in areas of significant unmet need, leveraging our demonstrated expertise and capabilities in GI diseases.
Item 1. Business Our Company We are a biotechnology company developing and commercializing life-changing therapies for people living with gastrointestinal, or GI, and rare diseases. We are focused on the development and commercialization of innovative product opportunities in areas of significant unmet need, leveraging our demonstrated expertise and capabilities in GI and rare diseases.
The boxed warning and contraindication previously applied to all children less than 18 years of age and less than 6 years of age, respectively. In June 2023, the U.S. FDA approved LINZESS as a once-daily treatment for pediatric patients ages 6-17 years-old with FC, making LINZESS the first and only FDA-approved prescription therapy for FC in this patient population.
The boxed warning and contraindication previously applied to all children less than 18 years of age and less than 6 years of age, respectively. In June 2023, the U.S. FDA approved LINZESS as a once-daily treatment for pediatric patients ages 6-17 years-old with FC, making LINZESS the first and only U.S. FDA-approved prescription therapy for FC in this patient population.
The U.S. FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions. Before approving an NDA, the U.S. FDA will typically inspect the facilities at which the product candidate is manufactured and will not approve the product candidate unless current GMP compliance is satisfactory. The U.S.
FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions. Before approving an NDA, the U.S. FDA will typically inspect the facilities at which the product candidate is manufactured and will not approve the product candidate unless current GMP compliance is satisfactory. The U.S.
Apraglutide Through the VectivBio Acquisition, we are advancing apraglutide, a next-generation, long-acting synthetic peptide analog of GLP-2, as a potentially differentiated therapeutic for SBS patients who are dependent on PS. SBS is a malabsorption disorder caused by the loss of functional small intestine, with symptoms that include diarrhea, dehydration, malnutrition and weight loss.
Apraglutide for SBS-IF Through the VectivBio Acquisition, we are advancing apraglutide, a next-generation, long-acting synthetic peptide analog of GLP-2, as a potentially differentiated therapeutic for SBS patients who are dependent on PS. SBS is a malabsorption disorder caused by the loss of functional small intestine, with symptoms that include diarrhea, dehydration, malnutrition and weight loss.
Phase II usually involves studies in a limited patient population (individuals with the disease under study) to: ● evaluate preliminarily the efficacy of the drug for specific, targeted conditions; ● determine dosage tolerance and appropriate dosage as well as other important information about how to design larger Phase III trials; and ● identify possible adverse effects and safety risks.
Phase II usually involves studies in a limited patient population (individuals with the disease under study) to: ● evaluate preliminarily the efficacy of the drug for specific, targeted conditions; ● determine dosage tolerance and appropriate dosage as well as other important information about how to design larger Phase III clinical trials; and ● identify possible adverse effects and safety risks.
In addition, AstraZeneca may be required to make milestone payments totaling up to $90.0 million contingent on the achievement of certain sales targets and is required to pay tiered royalties to us at rates beginning in the mid-single-digits percent and increasing up to twenty percent based on the aggregate annual net sales of products containing linaclotide in the territory. ​ 9 Table of Contents ​ Development and Commercialization Agreement with AKP ​ In March 2022, VectivBio entered into a development and commercialization agreement with Asahi Kasei Pharma Corporation, or AKP, in which VectivBio granted an exclusive license to AKP, with the right to sublicense in multiple tiers, to develop, commercialize and exploit products derived from apraglutide in Japan. ​ Pursuant to the terms of the development and commercialization agreement with AKP, VectivBio received an upfront payment of JPY 3,000 million ($24.6 million at date of agreement) and development-related payments of JPY 1,600 million in the aggregate ($13.1 million at date of agreement) and is eligible to receive development milestones of JPY 1,000 million ($8.2 million at date of agreement) and up to JPY 19,000 million ($155.8 million at date of agreement) of commercial and sales-based milestone payments.
In addition, AstraZeneca may be required to make milestone payments totaling up to $90.0 million contingent on the achievement of certain sales targets and is required to pay tiered royalties to us at rates beginning in the mid-single-digits percent and increasing up to twenty percent based on the aggregate annual net sales of products containing linaclotide in the territory. ​ Development and Commercialization Agreement with AKP ​ In March 2022, VectivBio entered into a development and commercialization agreement with Asahi Kasei Pharma Corporation, or AKP, in which VectivBio granted an exclusive license to AKP, with the right to sublicense in multiple tiers, to develop, commercialize and exploit products derived from apraglutide in Japan. ​ Pursuant to the terms of the development and commercialization agreement with AKP, VectivBio received an upfront payment of JPY 3,000 million ($24.6 million at date of agreement) and development-related payments of JPY 1,600 million in the aggregate ($13.1 million at date of agreement) and is eligible to receive development milestones of JPY 1,000 million ($8.2 million at date of agreement) and up to JPY 19,000 million ($155.8 million at date of agreement) of commercial and sales-based milestone payments.
In addition, we receive royalties from AbbVie in the mid-teens percent based on net sales in Canada and Mexico. AbbVie is solely responsible for the further development, regulatory approval and commercialization of linaclotide in those countries and funding any costs.
In addition, we receive royalties in the mid-teens percent based on net sales in Canada and Mexico. AbbVie is solely responsible for the further development, regulatory approval and commercialization of linaclotide in those countries and funding any costs.
In addition, Washington state recently passed the My Health My Data Act, a health privacy law, which regulates the collection and sharing of health information, and provides a right of action for violation of the statute.
In addition, Washington state passed the My Health My Data Act, a health privacy law, which regulates the collection and sharing of health information, and provides a right of action for violation of the statute.
FDA of an investigational new drug application, or IND, for human clinical testing, which must become effective before human clinical trial may begin; ● approval by an institutional review board, or IRB, representing each clinical site before each clinical trial may be initiated; ● development, manufacture and testing of active pharmaceutical product and dosage forms suitable for human use in compliance with current GMP; ● conducting adequate and well-controlled human clinical trials that establish the safety and efficacy of the product for its specific intended use(s), in accordance with good clinical practices, or GCP; ● preparation and submission to the U.S.
FDA of an investigational new drug application, or IND, for human clinical testing, which must become effective before human clinical trial may begin; 13 Table of Contents ● approval by an institutional review board, or IRB, representing each clinical site before each clinical trial may be initiated; ● development, manufacture and testing of active pharmaceutical product and dosage forms suitable for human use in compliance with current GMP; ● conducting adequate and well-controlled human clinical trials that establish the safety and efficacy of the product for its specific intended use(s), in accordance with good clinical practices, or GCP; ● preparation and submission to the U.S.
The granted, unexpired European patents, which will expire between 2027 and 2036, some of which have received patent term extension, contain claims directed to the linaclotide molecule, pharmaceutical compositions thereof, uses of linaclotide to prepare medicaments for treating GI disorders, and room temperature stable formulations of linaclotide and their use in treating IBS-C and chronic constipation.
The granted, unexpired European patents, which will expire between 2027 and 2031, some of which have received patent term extension, contain claims directed to the linaclotide molecule, pharmaceutical compositions thereof, uses of linaclotide to prepare medicaments for treating GI disorders, and room temperature stable formulations of linaclotide and their use in treating IBS-C and chronic constipation.
Refer to Note 16, Workforce Reductions and Restructuring , to our consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K for further details. ​ 24 Table of Contents Culture and Development ​ Fostering a welcoming and inclusive culture is essential to attracting, motivating and retaining the talent necessary to deliver on our corporate mission.
Refer to Note 16, Workforce Reductions and Restructuring , to our consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K for further details. 25 Table of Contents ​ Culture and Development ​ Fostering a welcoming and inclusive culture is essential to attracting, motivating and retaining the talent necessary to deliver on our corporate mission.
Many of these laws and regulations contain ambiguous requirements or require administrative guidance for implementation. ​ 23 Table of Contents Data Privacy and Security Laws ​ Pharmaceutical companies may be subject to U.S. federal and state health information privacy, security and data breach notification laws, which may govern the collection, use, disclosure and protection of health-related and other personal information.
Many of these laws and regulations contain ambiguous requirements or require administrative guidance for implementation. 24 Table of Contents ​ Data Privacy and Security Laws ​ Pharmaceutical companies may be subject to U.S. federal and state health information privacy, security and data breach notification laws, which may govern the collection, use, disclosure and protection of health-related and other personal information.
Not accounting for any patent term adjustment, regulatory patent term extensions or terminal disclaimers, and assuming that all annuity and/or maintenance fees are paid timely, the patents in this patent family are expected to expire in 2030. Our apraglutide portfolio also includes two wholly owned patent families.
Not accounting for any patent term adjustment, regulatory patent term extensions or terminal disclaimers, and assuming that all annuity and/or maintenance fees are paid timely, the patents in this patent family are expected to expire in 2030. Our apraglutide portfolio also includes five wholly owned patent families.
OTC laxatives make up the majority of the treatments in the U.S. for IBS-C and CIC, according to our research. LINZESS is the number one prescribed branded treatment in the U.S. for adults with IBS-C and CIC, according to 2024 data from IQVIA Inc. National Prescription Audit.
OTC laxatives make up the majority of the treatments in the U.S. for IBS-C and CIC, according to our research. LINZESS is the number one prescribed branded treatment in the U.S. for adults with IBS-C and CIC, according to 2025 data from IQVIA Inc. National Prescription Audit.
Symptoms of IBS-C include abdominal pain, discomfort and/or bloating and constipation symptoms (e.g., incomplete evacuation, infrequent bowel movements, hard/lumpy stools), while CIC is primarily characterized by constipation symptoms. 6 Table of Contents Greater than 65% of IBS-C patients suffer from bloating and/or discomfort at least one time per week, according to the Lieberman Survey. Linaclotide—U.S. In August 2012, the U.S.
Symptoms of IBS-C include abdominal pain, discomfort and/or bloating and constipation symptoms (e.g., incomplete evacuation, infrequent bowel movements, hard/lumpy stools), while CIC is primarily characterized by constipation symptoms. Greater than 65% of IBS-C patients suffer from bloating and/or discomfort at least one time per week, according to the Lieberman Survey. Linaclotide—U.S. In August 2012, the U.S.
In the E.U., clinical trials are governed by the Clinical Trials Regulation (E.U.) No. 536/2014, or CTR, which entered into application on January 31, 2022, replacing Directive 2001/20/EC, or CTD. The CTR is intended to harmonize and streamline clinical trial authorizations, simplify adverse-event reporting procedures, improve the supervision of clinical trials and increase their transparency.
In the E.U., clinical trials are governed by the Clinical Trials Regulation (E.U.) No. 536/2014, or CTR, which entered into application on January 31, 2022, replacing Directive 2001/20/EC, or CTD. The CTR is intended to 19 Table of Contents harmonize and streamline clinical trial authorizations, simplify adverse-event reporting procedures, improve the supervision of clinical trials and increase their transparency.
Eligible products must target conditions for which there is an unmet medical need (there is no satisfactory method of diagnosis, prevention or treatment in the E.U. or, if there is, the new medicinal product will bring a major therapeutic advantage) and they must demonstrate the potential to address the unmet medical need by introducing new methods of 20 Table of Contents therapy or improving existing ones.
Eligible products must target conditions for which there is an unmet medical need (there is no satisfactory method of diagnosis, prevention or treatment in the E.U. or, if there is, the new medicinal product will bring a major therapeutic advantage) and they must demonstrate the potential to address the unmet medical need by introducing new methods of therapy or improving existing ones.
Additionally, an MA may be granted to a similar medicinal product with the same orphan indication during the 10 year period if: (i) if the applicant consents to a second original orphan medicinal product application, (ii) if the manufacturer of the original orphan medicinal product is unable to supply sufficient quantities; or (iii) if the second applicant can establish that its product, although similar, is safer, more effective or otherwise clinically superior to the original orphan medicinal product.
Additionally, an MA may be granted to a similar medicinal product with the same orphan indication during the 10 year period if: (i) if the applicant consents to a second original orphan medicinal product application, (ii) if the manufacturer of the original orphan medicinal product is unable to supply sufficient 21 Table of Contents quantities; or (iii) if the second applicant can establish that its product, although similar, is safer, more effective or otherwise clinically superior to the original orphan medicinal product.
Apraglutide Patent Portfolio Our apraglutide patent portfolio includes a patent family which we exclusively license that is composed of one issued U.S. patent and 56 foreign patents. This patent family contains composition-of-matter claims covering apraglutide and methods of treatment using apraglutide.
Apraglutide Patent Portfolio Our apraglutide patent portfolio includes a patent family which we exclusively license that is composed of one issued U.S. patent and 58 foreign patents. This patent family contains composition-of-matter claims covering apraglutide and methods of treatment using apraglutide.
To support the application, the MA holder must provide the EMA or the competent authority with a consolidated version of the electronic Common Technical Document providing up-to-date data concerning the quality, safety and efficacy of the product, including all variations introduced since the MA was granted, at least nine months before the MA ceases to be valid.
To support the application, the MA holder must provide the EMA or the competent authority with a consolidated version of the electronic Common Technical 20 Table of Contents Document providing up-to-date data concerning the quality, safety and efficacy of the product, including all variations introduced since the MA was granted, at least nine months before the MA ceases to be valid.
The review process, however, may be extended by U.S. FDA requests for additional information, non-clinical or clinical studies, clarification regarding information already provided in the submission, or submission of a REMS. The U.S. FDA may refer an application to an advisory committee for review, evaluation and 15 Table of Contents recommendation as to whether the application should be approved.
The review process, however, may be extended by U.S. FDA requests for additional information, non-clinical or clinical studies, clarification regarding information already provided in the submission, or submission of a REMS. The U.S. FDA may refer an application to an advisory committee for review, evaluation and recommendation as to whether the application should be approved. The U.S.
The patents in this patent family that we exclusively license outside of the U.S. are issued in Europe, Japan, China, Australia, Canada, as well as other jurisdictions. The issued European patent is validated and issued in 37 countries, including Germany, the United Kingdom, France, Italy and Spain.
The patents in this patent family that we exclusively license outside of the 12 Table of Contents U.S. are issued in Europe, Japan, China, Australia, Canada, as well as other jurisdictions. The issued European patent is validated and issued in 37 countries, including Germany, the United Kingdom, France, Italy and Spain.
The contents of our website are not incorporated by reference into this report and you should not consider information provided on our website to be part of this report. ​ ​ 25 Table of Contents ​ PART II OTHER INFORMATION ​
The contents of our website are not incorporated by reference into this report and you should not consider information provided on our website to be part of this report. ​ PART II OTHER INFORMATION ​
Phase III trials generally further evaluate clinical efficacy and test for safety within an expanded patient population. The conduct of clinical trials is subject to extensive regulation, including compliance with GCP regulations and guidance, and regulations designed to protect the rights and safety of subjects involved in investigations. The U.S.
Phase III clinical trials further evaluate clinical efficacy and test for safety within an expanded patient population. The conduct of clinical trials is subject to extensive regulation, including compliance with GCP regulations and guidance, and regulations designed to protect the rights and safety of subjects involved in investigations.
Our revenue from our LINZESS collaboration with AbbVie for the U.S. is highly dependent on the responsiveness of patients to fill prescriptions and other factors such as retail chain and wholesaler buying patterns, pricing and reimbursement and inventory channel levels.
Our revenue from our LINZESS collaboration with AbbVie for the U.S. is highly dependent on the responsiveness of patients to fill prescriptions and other factors such as retail chain and wholesaler buying patterns, pricing and reimbursement and inventory channel levels. On November 25, 2025, the U.S.
In Phase I, the initial introduction of the drug into healthy human subjects, the drug is usually tested for safety (adverse effects), dosage tolerance and pharmacologic action, as well as to understand how the drug is taken up by and distributed within the body.
In Phase I, the initial introduction of the drug into healthy human subjects, the drug is usually tested for safety (adverse effects), dosage tolerance and 14 Table of Contents pharmacologic action, as well as to understand how the drug is taken up by and distributed within the body.
No company may market a new drug in the U.S. until it has submitted an NDA to the U.S. FDA, and the U.S. FDA has approved it. The steps required before the U.S. FDA may approve an NDA generally include: ● conducting non-clinical laboratory tests and animal tests in compliance with U.S.
No company may market a new drug in the U.S. until it has submitted an NDA to the U.S. FDA, and the U.S. FDA has approved it. The steps required before the U.S. FDA may approve an NDA generally include: ● conducting non-clinical laboratory tests and other studies in compliance with U.S.
AbbVie is commercializing CONSTELLA in a number of European countries, including the United Kingdom, Italy and Spain for adults with IBS-C. AbbVie has exclusive rights to commercialize linaclotide in Canada as CONSTELLA and in Mexico as LINZESS.
AbbVie is commercializing CONSTELLA in a number of European countries, including the United Kingdom, Italy and Spain for adults with IBS-C. 6 Table of Contents AbbVie has exclusive rights to commercialize linaclotide in Canada as CONSTELLA and in Mexico as LINZESS.
We have strategic partnerships with leading pharmaceutical companies to support the development and commercialization of linaclotide throughout the world, including with AbbVie Inc.
We have strategic partnerships with leading pharmaceutical companies to support the development and commercialization of linaclotide throughout the world, including with our partner, AbbVie Inc.
Under the terms of the amended and restated license agreement, Astellas is obligated to pay royalties to us at rates beginning in the mid-single-digits percent and escalating to low-double-digits percent, based on aggregate annual net sales in Japan of products containing linaclotide active pharmaceutical ingredient, or API.
On August 1, 2019, we and Astellas amended and restated the license agreement. Under the terms of the amended and restated license agreement, Astellas is obligated to pay royalties to us at rates beginning in the mid-single-digits percent and escalating to low-double-digits percent, based on aggregate annual net sales in Japan of products containing linaclotide active pharmaceutical ingredient, or API.
FDA also may require post marketing testing, known as Phase IV testing, REMS, and surveillance to monitor the effects of an approved product or to place conditions on an approval that restrict the distribution or use of the product.
FDA approval of an NDA. The U.S. FDA also may require post marketing testing, known as Phase IV testing, REMS, and surveillance to monitor the effects of an approved product or to place conditions on an approval that restrict the distribution or use of the product.
Moreover, a third-party payor’s decision to provide coverage for a finished drug product does not imply that an adequate reimbursement rate will be approved. Adequate third-party reimbursement may not be available to enable us to maintain price levels sufficient to realize an appropriate return on our investment in product development.
Moreover, a third-party payor’s 22 Table of Contents decision to provide coverage for a finished drug product does not imply that an adequate reimbursement rate will be approved. Adequate third-party reimbursement may not be available to enable us to maintain price levels sufficient to realize an appropriate return on our investment in product development.
European data protection authorities may interpret the GDPR and national laws differently and impose additional requirements, which add to the complexity of processing personal data in or from the EEA, United Kingdom or Switzerland. ​ Human Capital ​ As of December 31, 2024, we had 253 employees.
European data protection authorities may interpret the GDPR and national laws differently and impose additional requirements, which add to the complexity of processing personal data in or from the EEA, United Kingdom or Switzerland. ​ Human Capital ​ As of December 31, 2025, we had 100 employees.
FDA approved LINZESS as a once daily treatment for adult men and women suffering from IBS-C (290 mcg dose) or CIC (145 mcg dose). We and AbbVie began commercializing LINZESS in the U.S. in December 2012. In January 2017, the U.S. FDA approved a 72 mcg dose of linaclotide for the treatment of adult men and women with CIC.
FDA approved LINZESS as a once daily treatment for adults suffering from IBS-C (290 mcg dose) or CIC (145 mcg dose). We and AbbVie began commercializing LINZESS in the U.S. in December 2012. In January 2017, the U.S. FDA approved a 72 mcg dose of linaclotide for the treatment of adults with CIC in the U.S.
Our collaborative arrangements revenue may continue to fluctuate as a result of the timing and amount of royalties from sales of linaclotide in the 8 Table of Contents markets in which it is currently approved, or any other markets where linaclotide receives approval, as well as clinical and commercial milestones received and recognized under our strategic partnerships outside of the U.S.
Our collaborative arrangements revenue may continue to fluctuate as a result of the timing and amount of sales of linaclotide in the markets in which it is currently approved, or any other markets where linaclotide receives approval, as well as clinical and commercial milestones received and recognized under our strategic partnerships outside of the U.S.
Restrictions in coverage or decreases in third-party reimbursement for our products could have a material adverse effect 22 Table of Contents on our sales, results of operations and financial condition.
Restrictions in coverage or decreases in third-party reimbursement for our products could have a material adverse effect on our sales, results of operations and financial condition.
The granted, 12 Table of Contents unexpired Chinese patents, which will expire between 2029 and 2032, the granted Japanese patents, which will expire between 2026 and 2036, some of which are subject to granted and potential patent term extension, and the granted patents in other foreign jurisdictions, which will expire between 2026 and 2034, some of which may be subject to potential patent term extension, contain claims directed to the linaclotide molecule, pharmaceutical compositions of linaclotide for use in treating GI disorders, and room temperature stable formulations of linaclotide.
The granted, unexpired Chinese patent, which will expire in 2029, the granted Japanese patents, which will expire between 2026 and 2036, some of which are subject to granted and potential patent term extension, and the granted patents in other foreign jurisdictions, which will expire between 2026 and 2031, some of which may be subject to potential patent term extension, contain claims directed to the linaclotide molecule, pharmaceutical compositions of linaclotide for use in treating GI disorders, and room temperature stable formulations of linaclotide.
Additionally, approximately 20% of our employees are racially or ethnically diverse and in 2024, approximately 20% of our new hires were racially or ethnically diverse (excluding Europe-based employees, for which race and ethnicity is not disclosed). We seek to foster an environment where employees feel included and empowered.
Additionally, approximately 31% of our employees are racially or ethnically diverse and in 2025, approximately 57% of our new hires were racially or ethnically diverse (excluding Europe-based employees, for which race and ethnicity is not disclosed). We seek to foster an environment where employees feel included and empowered.
For example, for apraglutide, we compete with companies that are commercializing or developing drugs for SBS, such as Takeda, which currently distributes the GLP-2 analog teduglutide, marketed as GATTEX® (teduglutide) in the U.S. and REVESTIVE® (teduglutide for injection) in Europe, and Zealand Pharma A/S, or Zealand, which is developing glepaglutide, a long-acting GLP-2 analog, for the potential treatment of SBS for patients who are dependent on PS and is expecting to initiate an additional Phase III clinical trial in 2025 .
For example, for apraglutide, we compete with companies that are commercializing or developing drugs for SBS, such as Takeda, which currently distributes the GLP-2 analog teduglutide, marketed as GATTEX® (teduglutide) in the U.S. and REVESTIVE® (teduglutide for injection) in Europe, and Zealand Pharma A/S, or Zealand, which is developing glepaglutide, a long-acting GLP-2 analog, for the potential treatment of SBS for patients who are dependent on PS and initiated an additional Phase III clinical trial in the first quarter of 2026 .
In 2024, the HHS published the results of the first Medicare drug price negotiations for ten selected drugs that treat a range of conditions, including diabetes, chronic kidney disease, and rheumatoid arthritis, and the prices of the selected drugs will become effective on January 1, 2026.
In 2024, the HHS published the results of the first Medicare drug price negotiations for 10 selected drugs that treat a range of conditions, including diabetes, chronic kidney disease, and rheumatoid arthritis, and the prices of the selected drugs became effective on January 1, 2026.
If the NDA contains all pertinent information and data, the U.S. FDA will “file” the application and begin review. In the event it does not, the U.S. FDA will issue a “refuse-to-file” determination and request additional information before filing the NDA. U.S. FDA reviews an NDA pursuant to certain timelines and goals established by the Prescription Drug User Fee Act.
If the NDA contains all pertinent information and data, the U.S. FDA will “file” the application and begin review. In the event it does not, the U.S. FDA will issue a “refuse-to-file” determination and request additional information before filing the NDA. U.S. FDA reviews an NDA pursuant to certain timelines and goals established by the PDUFA.
FDA publication, Approved Drug Products with Therapeutic Equivalence Evaluations, or the Orange Book, six granted European patents, most of which have been validated in available European countries, ten granted Japanese patents, three granted Chinese patents, 61 issued patents in other foreign jurisdictions, and numerous pending U.S., foreign and Patent Cooperation Treaty, or PCT, patent applications.
FDA publication, 11 Table of Contents Approved Drug Products with Therapeutic Equivalence Evaluations, or the Orange Book, four granted European patents, most of which have been validated in available European countries, ten granted Japanese patents, a granted Chinese patent, 46 issued patents in other foreign jurisdictions, and numerous pending U.S., foreign and Patent Cooperation Treaty, or PCT, patent applications.
In this case, the relevant General Safety and Performance Requirements, or GSPRs of the MDR will apply to the safety and performance of the drug delivery device component. Orphan Medicinal Product Designation and Exclusivity .
In this case, the relevant General Safety and Performance Requirements of the Medical Device Regulation will apply to the safety and performance of the drug delivery device component. Orphan Medicinal Product Designation and Exclusivity .
The granted U.S. patent in this patent family claims a method of treating SBS at certain doses, and the pending U.S. and foreign patent applications contain composition-of-matter claims to ultrapure compositions of apraglutide, methods of manufacturing apraglutide, and methods of treatment using apraglutide.
One of the granted U.S. patents in this patent family claims a method of treating SBS at certain doses of apraglutide, and the other claims a liquid formulation of apraglutide for injection. The pending U.S. and foreign patent applications contain composition-of-matter claims to ultrapure compositions of apraglutide, methods of manufacturing apraglutide, and methods of treatment using apraglutide.
FDA. 14 Table of Contents Non-clinical tests include laboratory evaluation of the product candidate, as well as animal studies to assess the potential safety and efficacy of the product candidate. The conduct of the non-clinical tests must comply with federal regulations and requirements including GLP.
Non-clinical tests include laboratory evaluation of the product candidate, as well as animal studies to assess the potential safety and efficacy of the product candidate. The conduct of the non-clinical tests must comply with federal regulations and requirements including GLP. With passage of the U.S.
We are currently in the process of planning for the commercial launch of apraglutide, if approved, for commercialization, in the U.S. and with partners in territories outside the U.S. For example, we granted AKP an exclusive license to sublicense, develop, commercialize and exploit products derived from apraglutide in Japan. We are considering potential partnerships in other territories outside the U.S.
We continue to plan for a potential commercial launch of apraglutide, if successfully developed and approved, in the U.S. and with partners in territories outside the U.S. For example, we granted AKP an exclusive license to sublicense, develop, commercialize and exploit products derived from apraglutide in Japan. We are considering potential partnerships in other territories outside the U.S.
Key elements of our strategy include: Maximize LINZESS ● Leveraging our U.S.-focused commercial capabilities with our partner, AbbVie, to expand the commercial potential of LINZESS. ● Exploring development opportunities to enhance the clinical profile of LINZESS by studying linaclotide in additional indications, populations, and formulations. ● Collaborating with global partners who share our vision, values, culture, and processes to develop and commercialize linaclotide outside the U.S. ​ Advance GI pipeline ● Advancing our GI pipeline programs, highlighted by apraglutide for the potential treatment of SBS-IF. ● Evaluating strategic partnership options for our wholly owned GC-C agonist, IW-3300, for the potential treatment of IC/BPS and endometriosis. ​ Deliver sustained profits and cash flows ● Executing our strategy by delivering sustainable profits and cash flows. ● Applying a thoughtful and disciplined capital allocation strategy to deliver value for our shareholders over the long-term. ​ Competition Linaclotide competes globally with certain branded and generic prescription therapies and over-the-counter, or OTC, products for the treatment of IBS-C and CIC, or their associated symptoms.
Key elements of our strategy include: Maximizing LINZESS ● Leveraging our U.S.-focused commercial capabilities with our partner, AbbVie, to expand the commercial potential of LINZESS. ● Exploring development opportunities to enhance the clinical profile of LINZESS by studying linaclotide in additional indications, populations, and formulations. ● Collaborating with global partners who share our vision, values, culture, and processes to develop and commercialize linaclotide outside the U.S. ​ Advancing Apraglutide ● Advancing apraglutide for the potential treatment of SBS-IF. ​ Delivering sustained profits and cash flows ● Executing our strategy by delivering sustainable profits and cash flows. 9 Table of Contents ● Applying a thoughtful and disciplined capital allocation strategy to deliver value for our shareholders over the long-term. ​ Competition Linaclotide competes globally with certain branded and generic prescription therapies and over-the-counter, or OTC, products for the treatment of IBS-C and CIC, or their associated symptoms.
The regulatory authorities may also impose specific obligations as a condition of the MA. Such risk-minimization measures or post-authorization obligations may include additional safety monitoring, more frequent submission of PSURs, or the conduct of additional clinical trials or post-authorization safety studies. In the E.U., the advertising and promotion of medicinal products are subject to both E.U. and E.U.
Such risk-minimization measures or post-authorization obligations may include additional safety monitoring, more frequent submission of PSURs, or the conduct of additional clinical trials or post-authorization safety studies. In the E.U., the advertising and promotion of medicinal products are subject to both E.U. and E.U.
The 72 mcg, 145 mcg and 290 mcg LINZESS doses are covered by composition of matter patent in the U.S., which expires in 2026. In addition, the commercial formulations of the 72 mcg, 145 mcg and 290 mcg LINZESS doses are covered by patents in the U.S. that expire in the early 2030s.
In addition, the commercial formulations of the 72 mcg, 145 mcg and 290 mcg LINZESS doses are covered by patents in the U.S. that expire in the early 2030s.
FDA cannot approve the same product made by another manufacturer for the same indication during the market exclusivity period unless it has the consent of the sponsor, or the sponsor is unable to provide sufficient quantities. Regulation of Drug-Device Combination Products in the U.S.
FDA cannot approve the same product made by another manufacturer for the same indication during the market exclusivity period unless it has the consent of the sponsor, or the sponsor is unable to provide sufficient quantities.
The first patent family includes one granted U.S. patent and five pending U.S. non-provisional patent applications, as well as 27 pending foreign patent applications related to apraglutide.
The first patent family includes two granted U.S. patent and five pending U.S. non-provisional patent applications, as well as 2 granted patents and 16 pending foreign patent applications related to apraglutide.
FDA approval of ANDAs and 505(b)(2) applications for generic drugs for the conditions of approval (for example, indication or dosage form) that required new clinical investigations that were essential to approval; it does not prohibit the U.S.
FDA approval of ANDAs and 505(b)(2) applications for generic drugs for the conditions of approval (for example, indication or dosage form) that required new clinical investigations that were essential to approval; it does not prohibit the U.S. FDA from accepting or approving ANDAs or 505(b)(2) NDAs for generic drugs that do not include such conditions of approval. Paragraph IV Certifications.
This approach includes diversity initiatives such as learning and development opportunities, strengthened talent acquisition strategies, and the support of equality programs in our local communities. We are also proud to have several strong and growing employee resource groups. ​ Compensation and Benefits All our employees receive equity and are encouraged to think and act as owners of Ironwood.
This approach includes initiatives such as learning and development opportunities, strengthened talent acquisition strategies, and the support of equality programs in our local communities. ​ Compensation and Benefits All our employees receive equity and are encouraged to think and act as owners of Ironwood.
Women represent approximately 50% of our employee base, 30% of our leadership team (vice president and above) and 33% of our board of directors (including our board and audit committee chairs).
Women represent approximately 54% of our employee base, 23% of our leadership team (vice president and above) and 38% of our board of directors (including our board and audit committee chairs).
Linaclotide is available under the trademarked name CONSTELLA ® to adult men and women suffering from IBS-C or CIC and pediatric patients ages 6-17 years old with FC in Canada, and to adult men and women suffering from IBS-C in certain European countries.
Linaclotide is available under the trademarked name CONSTELLA® for the treatment of adults with IBS-C or CIC and pediatric patients ages 6-17 years old with FC in Canada, and to adults with IBS-C in certain European countries.
It is also responsible for developing guidance and regulations to clarify the regulation of combination products, and for assignment of the U.S. FDA center that has primary jurisdiction for review of drug-device combination products where the jurisdiction is unclear or in dispute.
That office serves as a focal point for combination product issues for agency reviewers and industry. It is also responsible for developing guidance and regulations to clarify the regulation of combination products, and for assignment of the U.S. FDA center that has primary jurisdiction for review of drug-device combination products where the jurisdiction is unclear or in dispute.
The time and expense required to perform the clinical testing necessary to obtain U.S. FDA approval for regulated products can frequently exceed the time and expense of the research and development initially required to create the product.
FDA approval for regulated products can frequently exceed the time and expense of the research and development initially required to create the product.
FDA, in a class of GI medicines called guanylate cyclase type C agonists, or GC-C agonists, and is indicated for adult men and women suffering from irritable bowel syndrome with constipation, or IBS-C, or chronic idiopathic constipation, or CIC, and for pediatric patients ages 6-17 years-old suffering from functional constipation, or FC.
FDA, in a class of GI medicines called guanylate cyclase type C agonists, or GC-C agonists, and is indicated for the treatment, in the U.S., of irritable bowel syndrome with constipation, or IBS-C, in adults and pediatric patients 7 years of age and older, chronic idiopathic constipation, or CIC, in adults, and functional constipation, or FC, in pediatric patients ages 6-17 years-old.
TRULANCE® (plecanatide) was approved in the U.S. for the 10 Table of Contents treatment of adults with IBS-C and CIC and is being commercialized in the U.S. by Bausch Health Companies, or Bausch. Shire plc obtained approval of MOTEGRITY™ (prucalopride) in the U.S. for the treatment of CIC in adults.
TRULANCE® (plecanatide) was approved in the U.S. for the treatment of adults with IBS-C and CIC and is being commercialized in the U.S. by Bausch Health Companies, or Bausch. Shire plc obtained approval of MOTEGRITY™ (prucalopride) in the U.S. for the treatment of CIC in adults, and generic versions have been available in the U.S. since January 2025.
The development and commercialization agreement will terminate upon the expiration of the Royalty Term. ​ Our Strategy Our strategy is focused on three core priorities: maximize LINZESS, advance our GI pipeline, and deliver sustained profits and cash flow.
The development and commercialization agreement will terminate upon the expiration of the Royalty Term. ​ Our Strategy Our strategy is focused on three core priorities: maximizing LINZESS, advancing apraglutide, and delivering sustained profits and cash flow.
Not accounting for any patent term adjustment, regulatory patent term extension or terminal disclaimers, and assuming that all annuity and/or maintenance fees are paid timely, any U.S. and foreign patents granted from the pending patent applications would be expected to expire in 2042. 13 Table of Contents Government Regulation Our business is subject to government regulation in the U.S., E.U., and in other countries.
Not accounting for any patent term adjustment, regulatory patent term extension or terminal disclaimers, and assuming that all annuity and/or maintenance fees are paid timely, the granted European patent and any U.S. and foreign patents granted from the pending patent applications would be expected to expire in 2042.
The issued, unexpired U.S. patents, which will expire between 2026 and 2033, contain claims directed to the linaclotide molecule, pharmaceutical compositions thereof, methods of using linaclotide to treat GI disorders, processes for making the molecule, and room temperature stable formulations of linaclotide and methods of use thereof.
We and our partners own, either jointly or individually, all of the issued patents and pending applications. The issued, unexpired U.S. patents, which will expire between 2026 and 2033, contain claims directed to the linaclotide molecule, pharmaceutical compositions thereof, methods of using linaclotide to treat GI disorders, and room temperature stable formulations of linaclotide and methods of use thereof.
On January 17, 2025, HHS announced the selection of 15 additional drugs, which included LINZESS, covered by Medicare Part D, for the second cycle of price negotiations. The negotiated price for LINZESS will be effective starting January 1, 2027.
On January 17, 2025, HHS announced the selection of 15 additional drugs, which included LINZESS, covered by Medicare Part D, for the second cycle of price negotiations, and on November 25, 2025, HHS released the MFP for LINZESS.
Performance Against 2024 Core Priorities In 2024, our GI-focused strategy, building on our commercial success and GI development capabilities, continued to focus on three core priorities: maximize LINZESS, advance our GI pipeline, and deliver sustained profits and generate cash flow.
Performance Against 2025 Core Priorities In 2025, our GI and rare diseases-focused strategy, building on our commercial success and GI development capabilities, continued to focus on three core priorities: maximizing LINZESS, advancing apraglutide, and delivering sustained profits and cash flow.
Changes to some of the conditions established in an approved application, including changes in indications, labeling, or manufacturing processes or facilities, require submission and U.S. FDA approval of a new NDA or sNDA before the change can be implemented.
FDA also issued a generic “notice letter” directing companies to “remove any noncompliant advertising and bring all promotional communications into compliance.” Changes to some of the conditions established in an approved application, including changes in indications, labeling, or manufacturing processes or facilities, require submission and U.S. FDA approval of a new NDA or sNDA before the change can be implemented.
Advance GI Pipeline ● In February 2024, we announced positive topline results from our pivotal Phase III clinical trial, STARS, which evaluated the efficacy and safety of once-weekly subcutaneous apraglutide in reducing PS dependency in adult patients with SBS-IF, and in January 2025, we initiated a rolling NDA submission to the U.S.
In February 2024, we announced positive topline results from our pivotal Phase III clinical trial, STARS, which evaluated the efficacy and safety of once-weekly subcutaneous apraglutide in reducing PS dependency in adult patients with short bowel syndrome with intestinal failure, or SBS-IF.
Of these employees, 69 were on our drug development team, 131 were on our sales and commercial team, and 53 were in general and administrative functions.
Of these employees, 66 were on our drug development team and 34 were in selling, general and administrative functions.
Active site in the context of transitioning means that the last visit of the last subject, or the other trial-related interventions with the subject specified in the protocol, will take place after January 30, 2025. 19 Table of Contents Clinical trials with no active sites authorized under CTD do not need to be transitioned even if the global trial is still ongoing outside the E.U. after the transition deadline.
Ongoing clinical trials authorized under CTD with at least one active site in the E.U. on January 30, 2025 needed to be transitioned to CTR. Active site in the context of transitioning means that the last visit of the last subject, or the other trial-related interventions with the subject specified in the protocol, will take place after January 30, 2025.
When an ANDA or 505(b)(2) application is submitted, it must contain one of several possible certifications regarding each of the patents listed in the Orange Book for the reference drug. A certification that a listed patent is invalid, unenforceable or will not be infringed by the sale of the proposed product is called a “Paragraph IV” certification.
When an ANDA or 505(b)(2) application is submitted, it must contain one of several possible certifications regarding each of the patents listed in the Orange Book for the reference drug.
Through our acquisition of VectivBio Holding AG, or VectivBio, in June 2023, or the VectivBio Acquisition, we are advancing apraglutide, a next-generation, synthetic long-acting peptide analog of glucagon-like peptide-2, or GLP-2, for short bowel syndrome patients, or SBS, who are dependent on parenteral support, or PS.
(together with its affiliates), or AbbVie, in the U.S. and all countries worldwide other than China (including Hong Kong and Macau) and Japan, AstraZeneca AB (together with its affiliates), or AstraZeneca, in China (including Hong Kong and Macau) and Astellas Pharma Inc., or Astellas, in Japan. ​ Through our acquisition of VectivBio Holding AG, or VectivBio, in June 2023, or the VectivBio Acquisition, we are advancing apraglutide, a next-generation, synthetic long-acting peptide analog of glucagon-like peptide-2, or GLP-2, for short bowel syndrome, or SBS, patients who are dependent on parenteral support, or PS.
Drug development involves a high degree of risk and investment, and the status, timing and scope of our development programs are subject to change. Important factors that could adversely affect our drug development efforts are discussed under the heading “Risk Factors” in this Annual Report on Form 10-K.
Important factors that could adversely affect our drug development efforts are discussed under the heading “Risk Factors” in this Annual Report on Form 10-K.
FDA inspections of non-clinical and clinical trial sites to assure compliance with GLP and GCP requirements; and ● U.S. FDA review and approval of the NDA, which may be subject to post-approval requirements, including the potential requirement to implement a Risk Evaluation and Mitigation Strategy, or REMS, and any post-approval studies required by the U.S.
FDA approval of the NDA to allow marketing of the new drug product; and ● compliance with any post-approval requirements, including the potential requirement to implement a Risk Evaluation and Mitigation Strategy, or REMS, and any post-approval studies required by the U.S. FDA.
The failure to submit clinical trial information to clinicaltrials.gov is a prohibited act under the FDCA with violations subject to potential civil monetary penalties, injunctions and/or criminal prosecution or disqualification from federal grants.
The failure to submit clinical trial information to clinicaltrials.gov is a prohibited act under the FDCA with violations subject to potential civil monetary penalties, injunctions and/or criminal prosecution or disqualification from federal grants. Although the U.S. FDA has historically not enforced these reporting requirements, the U.S. FDA has issued several notices of non-compliance to manufacturers since April 2021.
FDA uses similar procedures and actions in reviewing such sNDAs as it does in reviewing NDAs. 18 Table of Contents Adverse event reporting and submission of periodic reports are required following U.S. FDA approval of an NDA. The U.S.
An sNDA for a new indication typically requires clinical data similar in type and quality to the clinical data supporting the original application for the original indication, and the U.S. FDA uses similar procedures and actions in reviewing such sNDAs as it does in reviewing NDAs. Adverse event reporting and submission of periodic reports are required following U.S.
A certification that provides the date a listed patent will expire, but does not challenge the validity, enforceability or infringement of the patent, is called a “Paragraph III” certification. FDA can approve the ANDA or 505(b)(2) application containing the Paragraph III certification upon expiration of the patent. Within 20 days of the acceptance by the U.S.
The U.S. FDA can approve the ANDA or 505(b)(2) application containing the Paragraph III certification upon expiration of the patent. Within 20 days of the acceptance by the U.S.
In territories outside the U.S., we expect to rely on partners to develop and commercialize our products and product candidates. In executing our strategy, our goal is to retain oversight over the worldwide development and commercialization of our products by playing an active role in their commercialization or finding partners who share our vision, values, culture and processes.
In executing our strategy, our goal is to retain oversight over the worldwide development and commercialization of our products by playing an active role in their commercialization or finding partners who share our vision, values, culture and processes. We and/or our partners have core commercial capabilities in place, including marketing, patient engagement and key sales support roles.
In February 2024, we announced positive topline results from our pivotal Phase III clinical trial, STARS, which evaluated the efficacy and safety of once-weekly subcutaneous apraglutide in reducing parenteral support dependency in adult patients with SBS-IF. In January 2025, we initiated a rolling new drug application, or NDA, to the U.S.
In February 2024, we announced positive topline results from our pivotal Phase III clinical trial, STARS, which evaluated the efficacy and safety of once-weekly subcutaneous apraglutide in reducing PS dependency in adult patients with SBS-IF. We are also conducting an open-label extension study, STARS Extend, to further assess safety of apraglutide in adult patients with SBS-IF.
FDA is charged with assigning a center with primary jurisdiction, or a lead center, for review of a drug-device combination product. The determination of which center will be the lead center is based on the “primary mode of action” of the drug-device combination product.
The determination of which center will be the lead center is based on the “primary mode of action” of the drug-device combination product. Thus, if the primary mode of action of a drug-device combination product is attributable to the drug product, the U.S.
The holder of an MA must establish and maintain a pharmacovigilance system and appoint a qualified person for pharmacovigilance who is responsible for oversight of that system.
The holder of an MA must establish and maintain a pharmacovigilance system and appoint a qualified person for pharmacovigilance who is responsible for oversight of that system. Key obligations include expedited reporting of suspected serious adverse reactions and submission of periodic safety update reports, or PSURs.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThese and other provisions in our certificate of incorporation and our bylaws and in the Delaware General Corporation Law could make it more difficult for stockholders or potential acquirers to obtain control of our board of directors or initiate actions that are opposed by the then-current board of directors. ​ We have identified material weaknesses in our internal control over financial reporting.
Biggest changeThese and other provisions in our certificate of incorporation and our bylaws and in the Delaware General Corporation Law could make it more difficult for stockholders or potential acquirers to obtain control of our board of directors or initiate actions that are opposed by the then-current board of directors. ​ If we identify a material weakness in our internal control over financial reporting, it could have an adverse effect on our business and financial results, and our ability to meet our reporting obligations could be negatively affected, each of which could negatively affect the trading price of our Class A Common Stock. ​ A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.
Delays in the completion of clinical testing of any of our products or product candidates could result in increased costs and delay or limit our ability to generate revenues. Delays in the completion of clinical testing could significantly affect our product development costs and timing of data readouts and regulatory submissions and potential approvals.
Delays in the completion of clinical testing of any of our products or product candidates could result in increased costs and could delay or limit our ability to generate revenues. Delays in the completion of clinical testing could significantly affect our product development costs and timing of data readouts and regulatory submissions and potential approvals.
If a third party claims that we or our partners infringe its intellectual property rights, we may face a number of issues, including, but not limited to: ​ ● infringement and other intellectual property claims which, regardless of merit, may be expensive and time- consuming to litigate and may divert our management’s attention from our core business; ​ ● substantial damages for infringement, which we may have to pay if a court decides that the product at issue infringes on or violates the third party’s rights, and, if the court finds that the infringement was willful, we could be ordered to pay treble damages and the patent owner’s attorneys’ fees; ​ ● a court prohibiting us from selling our product unless the third party licenses its rights to us, which it is not required to do; ​ ● if a license is available from a third party, we may have to pay substantial royalties, fees or grant cross- licenses to our intellectual property rights; and ​ ● redesigning our products so they do not infringe, which may not be possible or may require substantial monetary expenditures and time. 48 Table of Contents ​ If we fail to comply with our obligations or have disagreements over contract interpretation in agreements under which we license intellectual property and other rights from third parties or otherwise experience disruptions to our business relationship with our licensor, the scope of our intellectual property or technology rights could be narrowed and we could lose license rights that are important to our business. ​ Licensing of intellectual property is of critical importance to our business and involves complex legal, business, and scientific issues.
If a third party claims that we or our partners infringe its intellectual property rights, we may face a number of issues, including, but not limited to: ​ ● infringement and other intellectual property claims which, regardless of merit, may be expensive and time- consuming to litigate and may divert our management’s attention from our core business; ​ ● substantial damages for infringement, which we may have to pay if a court decides that the product at issue infringes on or violates the third party’s rights, and, if the court finds that the infringement was willful, we could be ordered to pay treble damages and the patent owner’s attorneys’ fees; ​ ● a court prohibiting us from selling our product unless the third party licenses its rights to us, which it is not required to do; ​ ● if a license is available from a third party, we may have to pay substantial royalties, fees or grant cross- licenses to our intellectual property rights; and ​ ● redesigning our products so they do not infringe, which may not be possible or may require substantial monetary expenditures and time. ​ If we fail to comply with our obligations or have disagreements over contract interpretation in agreements under which we license intellectual property and other rights from third parties or otherwise experience disruptions to our business 48 Table of Contents relationship with our licensor, the scope of our intellectual property or technology rights could be narrowed and we could lose license rights that are important to our business. ​ Licensing intellectual property is of critical importance to our business and involves complex legal, business, and scientific issues.
In the event of such default, the trustee or noteholders could elect to declare all amounts outstanding to be immediately due and payable under the indenture, which could have a material adverse effect on our business, financial condition and results of operations. ​ To the extent we become subject to such covenants, our ability to comply with such covenants in future periods will depend on our ongoing financial and operating performance, which in turn will be subject to economic conditions and to financial, market and competitive factors, many of which are beyond our control. ​ Our significant indebtedness, combined with our other financial obligations and contractual commitments, could have important consequences on our business, including: ​ ● limiting our ability to obtain additional financing to fund future working capital, capital expenditures or other general corporate purposes, including product development, commercialization efforts, research and development activities, strategic arrangements, acquisitions and refinancing of our outstanding debt; ​ ● requiring a substantial portion of our cash flows to be dedicated to debt service payments instead of other purposes, thereby reducing the amount of cash flows available for working capital, capital expenditures, corporate transactions and other general corporate purposes; ​ ● increasing our vulnerability to adverse changes in general economic, industry and competitive conditions; ​ ● limiting our flexibility in planning for and reacting to changes in the industry in which we compete; ​ 54 Table of Contents ● placing us at a disadvantage compared to other, less leveraged competitors or competitors with comparable debt at more favorable interest rates; and ​ ● increasing our cost of borrowing. ​ If we do not generate sufficient cash flows from operations or if future borrowings are not available to us in an amount sufficient to service our indebtedness, including payments of principal when due on our outstanding indebtedness or, in the case of our Convertible Senior Notes, in connection with a transaction involving us that constitutes a fundamental change under the indentures governing the Convertible Senior Notes, or under our Revolving Credit Facility, or to fund our liquidity needs, we may be forced to refinance all or a portion of our indebtedness on or before the maturity dates thereof, sell assets, reduce or delay currently planned activities or curtail operations, seek to raise additional capital or take other actions.
In the event of such default, the trustee or noteholders could elect to declare all amounts outstanding to be immediately due and payable under the indenture, which could have a material adverse effect on our business, financial condition and results of operations. ​ To the extent we become subject to such covenants, our ability to comply with such covenants in future periods will depend on our ongoing financial and operating performance, which in turn will be subject to economic conditions and to financial, market and competitive factors, many of which are beyond our control. ​ Our significant indebtedness, combined with our other financial obligations and contractual commitments, could have important consequences on our business, including: ​ ● limiting our ability to obtain additional financing to fund future working capital, capital expenditures or other general corporate purposes, including product development, commercialization efforts, research and development activities, strategic arrangements, acquisitions and refinancing of our outstanding debt; ​ 54 Table of Contents ● requiring a substantial portion of our cash flows to be dedicated to debt service payments instead of other purposes, thereby reducing the amount of cash flows available for working capital, capital expenditures, corporate transactions and other general corporate purposes; ​ ● increasing our vulnerability to adverse changes in general economic, industry and competitive conditions; ​ ● limiting our flexibility in planning for and reacting to changes in the industry in which we compete; ​ ● placing us at a disadvantage compared to other, less leveraged competitors or competitors with comparable debt at more favorable interest rates; and ​ ● increasing our cost of borrowing. ​ If we do not generate sufficient cash flows from operations or if future borrowings are not available to us in an amount sufficient to service our indebtedness, including payments of principal when due on our outstanding indebtedness or, in the case of our Convertible Senior Notes, in connection with a transaction involving us that constitutes a fundamental change under the indentures governing the Convertible Senior Notes, or under our Revolving Credit Facility, or to fund our liquidity needs, we may be forced to refinance all or a portion of our indebtedness on or before the maturity dates thereof, sell assets, reduce or delay currently planned activities or curtail operations, seek to raise additional capital or take other actions.
Products with other mechanisms of action may emerge as future competition. ​ Our products or product candidates may cause undesirable side effects or have other properties that could delay or prevent their development, create unpredictable clinical trial results, impact its regulatory approval or limit their commercial potential. ​ Undesirable side effects caused by our products or product candidates, including adverse events associated with our product candidates, could cause us or regulatory authorities to interrupt, delay or halt clinical trials and could result in a more restrictive label or the delay or denial of regulatory approval by the U.S.
Products with other mechanisms of action may emerge as future competition. ​ Our products or product candidates may cause undesirable side effects or have other properties that could delay or prevent their development, create unpredictable clinical trial results, impact their regulatory approval or limit their commercial potential. ​ Undesirable side effects caused by our products or product candidates, including adverse events associated with our product candidates, could cause us or regulatory authorities to interrupt, delay or halt clinical trials and could result in a more restrictive label or the delay or denial of regulatory approval by the U.S.
The foregoing, or the perception of the foregoing, may have the following effects, among others: ​ ● sales of our products may be impaired; ​ ● regulatory approvals for our products may be delayed, denied, restricted or withdrawn; ​ ● we or our partners may decide to, or be required to, change the products’ labeling or send product warning letters or field alerts to physicians, pharmacists or hospitals; ​ ● reformulation of the products, additional nonclinical studies or clinical trials, changes in labeling or changes to or re-approvals of manufacturing facilities may be required; ​ ● we or our partners may be precluded from pursuing approval of our products in new territories or from studying additional development opportunities to enhance our products’ clinical profiles, including within new or existing indications, populations or formulations, as well as in potential combination products; ​ ● we may be required to create a Risk Evaluation and Mitigation Strategy, or REMS, plan, or similar actions in other jurisdictions which could include a medication guide outlining the risks of such side effects for distribution to patients, a communication plan for healthcare providers or other elements to assure safe use; ​ ● our or our products’ reputation in the marketplace may suffer; and ​ ● government investigations or lawsuits, including class action suits, may be brought against us or our partners. ​ 34 Table of Contents Any of the above occurrences could prevent us from achieving or maintaining market acceptance of our product candidates, if they are approved, and could significantly harm our business, results of operations, and prospects, prevent sales of our products, increase expenses and impair our and our partners’ ability to successfully commercialize our products. ​ Linaclotide has been prescribed to millions of patients since its launch in the U.S. and other territories beginning in December 2012.
The foregoing, or the perception of the foregoing, may have the following effects, among others: ​ ● sales of our products may be impaired; ​ ● regulatory approvals for our products may be delayed, denied, restricted or withdrawn; ​ ● we or our partners may decide to, or be required to, change the products’ labeling or send product warning letters or field alerts to physicians, pharmacists or hospitals; ​ ● reformulation of the products, additional nonclinical studies or clinical trials, changes in labeling or changes to or re-approvals of manufacturing facilities may be required; ​ ● we or our partners may be precluded from pursuing approval of our products in new territories or from studying additional development opportunities to enhance our products’ clinical profiles, including within new or existing indications, populations or formulations, as well as in potential combination products; ​ ● we may be required to create a Risk Evaluation and Mitigation Strategy, or REMS, plan, or similar actions in other jurisdictions which could include a medication guide outlining the risks of such side effects for distribution to patients, a communication plan for healthcare providers or other elements to assure safe use; ​ ● our or our products’ reputation in the marketplace may suffer; and ​ ● government investigations or lawsuits, including class action suits, may be brought against us or our partners. ​ Any of the above occurrences could prevent us from achieving or maintaining market acceptance of our product candidates, if they are approved, and could significantly harm our business, results of operations, and prospects, prevent sales of our products, increase expenses and impair our and our partners’ ability to successfully commercialize our products. ​ Linaclotide has been prescribed to millions of patients since its launch in the U.S. and other territories beginning in December 2012.
For example, Washington state recently passed the My Health My Data Act to which we are subject, which regulates the collection and sharing of health information, and provides a right of action for violation of the statute. ​ The compliance obligations imposed by the GDPR, United Kingdom’s GDPR, FADP, the California Privacy Law, Washington’s My Health My Data Act, and other applicable privacy laws, have required us to revise our operations.
For example, Washington state passed the My Health My Data Act to which we are subject, which regulates the collection and sharing of health information, and provides a right of action for violation of the statute. ​ The compliance obligations imposed by the GDPR, United Kingdom’s GDPR, FADP, the California Privacy Law, Washington’s My Health My Data Act, and other applicable privacy laws, have required us to revise our operations.
We have financed our business to date primarily through the issuance of equity, our collaboration and license arrangements, and debt issuances, including our $200.0 million aggregate principal amount of Convertible Senior Notes, bearing an interest of 1.50% and due in 2026, or the Convertible Senior Notes, and our $550.0 million secured revolving credit facility, or the Revolving Credit Facility.
We have financed our business to date primarily through the issuance of equity, our collaboration and license arrangements, and debt issuances, including our $200.0 million aggregate principal amount of Convertible Senior Notes, bearing an interest of 1.50% and due in June 2026, or the Convertible Senior Notes, and our $550.0 million secured revolving credit facility, or the Revolving Credit Facility.
Congress enacted the PPACA, as modified by the Health Care and Education Reconciliation Act, or the ACA, which, among other things, expanded healthcare coverage through Medicaid expansion and the implementation of the individual health insurance mandate; included changes to the coverage and reimbursement of drug products under government healthcare programs; imposed an annual fee on manufacturers of branded drugs; and expanded government enforcement authority. ​ Beyond the ACA, there have been ongoing legislative and administrative and other health care reform efforts, which could have an adverse effect on our products’ or product candidates’ commercial success.
Congress enacted the PPACA, as modified by the Health Care and Education Reconciliation Act, or the ACA, which, among other things, expanded healthcare coverage through Medicaid expansion and the implementation of the individual health insurance mandate; included changes to the coverage and reimbursement of drug products under government healthcare programs; imposed an annual fee on manufacturers of branded drugs; and expanded government enforcement authority. ​ Beyond the ACA, there have been ongoing legislative and administrative and other health care reform efforts, which have had an adverse effect on our products’ or product candidates’ commercial success.
In addition, we may not be able to prevent, alone or with 51 Table of Contents our partners, misappropriation of our proprietary rights, particularly in countries where the laws may not protect those rights as fully as in the U.S. ​ Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation, as well as the potential for public announcements of the results of hearings, motions or other interim proceeding or developments, there is a risk that some of our confidential information could be compromised by disclosure during this type of litigation. ​ Risks Related to Our Finances and Capital Requirements ​ We incurred significant losses from our inception in 1998 through the year ended December 31, 2018, and we may incur losses in future periods. ​ In recent years, we have focused primarily on developing, manufacturing and commercializing linaclotide, as well as developing our other product candidates.
In addition, we may not be able to prevent, alone or with our partners, misappropriation of our proprietary rights, particularly in countries where the laws may not protect those rights as fully as in the U.S. ​ Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation, as well as the potential for public announcements of the results of hearings, motions or other interim proceeding or developments, there is a risk that some of our confidential information could be compromised by disclosure during this type of litigation. ​ Risks Related to Our Finances and Capital Requirements ​ We incurred significant losses from our inception in 1998 through the year ended December 31, 2018, and we may incur losses in future periods. ​ In recent years, we have focused primarily on developing, manufacturing and commercializing linaclotide, as well as developing our other product candidates.
The commencement and completion of clinical trials can be delayed for a number of reasons, including delays related to: ● obtaining regulatory authorization to commence a clinical trial; ● reaching agreement on acceptable terms with prospective contract research organizations, or CROs, and trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and trial sites; 32 Table of Contents ● manufacturing sufficient quantities of a product candidate for use in clinical trials; ● obtaining institutional review board or ethics committee approval to conduct a clinical trial at a prospective site; ● recruiting and enrolling patients to participate in clinical trials for a variety of reasons, including competition from other clinical trial programs for the treatment of similar conditions; and ● maintaining patients who have initiated a clinical trial but may be prone to withdraw due to side effects from the therapy, lack of efficacy or personal issues, or who are lost to further follow-up.
The commencement and completion of clinical trials can be delayed for a number of reasons, including delays related to: ● obtaining regulatory authorization to commence a clinical trial; ● reaching agreement on acceptable terms with prospective contract research organizations, or CROs, and trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and trial sites; ● manufacturing sufficient quantities of a product candidate for use in clinical trials; ● obtaining institutional review board or ethics committee approval to conduct a clinical trial at a prospective site; ● recruiting and enrolling patients to participate in clinical trials for a variety of reasons, including competition from other clinical trial programs for the treatment of similar conditions; and ● maintaining patients who have initiated a clinical trial but may be prone to withdraw due to side effects from the therapy, lack of efficacy or personal issues, or who are lost to further follow-up.
Our collaborative arrangements revenue outside of the U.S. has and may continue to fluctuate as a result of the timing and amount of royalties from sales of linaclotide in the markets in which it is currently approved, or any other markets where linaclotide receives approval, as well as clinical and commercial milestones received and recognized under our current and future strategic partnerships outside of the U.S. ​ For the year ended December 31, 2023, we incurred a net loss in connection with the VectivBio Acquisition.
Our collaborative arrangements revenue outside of the U.S. has and may continue to fluctuate as a result of the timing and amount of sales of linaclotide in the markets in which it is currently approved, or any other markets where linaclotide receives approval, as well as clinical and commercial milestones received and recognized under our current and future strategic partnerships outside of the U.S. ​ For the year ended December 31, 2023, we incurred a net loss in connection with the VectivBio Acquisition.
Our net income (loss) and other operating results will be affected by numerous factors, including: ​ ● the level of underlying demand and price for our products in the countries in which they are approved; ​ ● retail chains’ and wholesalers’ buying patterns, pricing and reimbursement and inventory levels with respect to our products; ​ ● the costs associated with commercializing our products in the U.S.; ​ ● the achievement and timing of milestone payments and royalties due or payable under our collaboration and license agreements; ​ ● our execution of any collaboration, partnership, licensing or other strategic arrangements, and the timing of payments we may make or receive under these arrangements; ​ ● any impairments of assets or goodwill, and associated write-downs; ​ 55 Table of Contents ● any variations in the level of expenses related to our development programs; ​ ● addition or termination of clinical trials; ​ ● results of or developments in nonclinical studies and clinical trials of our product candidates or those of our competitors or potential collaborators; ​ ● any impact on taxes or changes in tax rules; ​ ● regulatory developments affecting our products and product candidates; ​ ● the success of competitive products or technologies; ​ ● any material lawsuit in which we may become involved; ​ ● general economic, industry, and market conditions; and ​ ● the impact of public health emergencies, including containment or mitigation measures, or natural disasters. ​ If our operating results fall below the expectations of investors or securities analysts for any of the foregoing reasons or otherwise, the price of our Class A Common Stock could decline substantially.
Our net income (loss) and other operating results will be affected by numerous factors, including: ​ ● the level of underlying demand and price for our products in the countries in which they are approved; ​ ● retail chains’ and wholesalers’ buying patterns, pricing and reimbursement and inventory levels with respect to our products; ​ ● the costs associated with commercializing our products in the U.S.; ​ 55 Table of Contents ● the achievement and timing of milestone payments and royalties due or payable under our collaboration and license agreements; ​ ● our execution of any collaboration, partnership, licensing or other strategic arrangements, and the timing of payments we may make or receive under these arrangements; ​ ● any impairments of assets or goodwill, and associated write-downs; ​ ● any variations in the level of expenses related to our development programs; ​ ● addition or termination of clinical trials; ​ ● results of or developments in nonclinical studies and clinical trials of our product candidates or those of our competitors or potential collaborators; ​ ● any impact on taxes or changes in tax rules; ​ ● regulatory developments affecting our products and product candidates; ​ ● the success of competitive products or technologies; ​ ● any material lawsuit in which we may become involved; ​ ● general economic, industry, and market conditions; and ​ ● the impact of public health emergencies, geopolitical events or natural disasters. ​ If our operating results fall below the expectations of investors or securities analysts for any of the foregoing reasons or otherwise, the price of our Class A Common Stock could decline substantially.
Although we believe we have put in place a robust compliance program, which is designed to ensure that all such activities are performed in a legal and compliant manner, we cannot be certain that our program will address all areas of potential exposure and the risks in this area cannot be entirely eliminated. ​ 43 Table of Contents If we fail to comply with healthcare and other regulations, we could face substantial penalties and our business, operations and financial condition could be adversely affected. ​ The marketing of pharmaceutical and biopharmaceutical products and related arrangements with healthcare providers, third-party payors, patients and other third parties in the healthcare industry are subject to a wide range of healthcare laws and regulations within the U.S. and in foreign jurisdictions in which we operate.
Although we believe we have put in place a robust compliance program, which is designed to ensure that all such activities are performed in a legal and compliant manner, we cannot be certain that our program will address all areas of potential exposure and the risks in this area cannot be entirely eliminated. ​ If we fail to comply with healthcare and other regulations, we could face substantial penalties and our business, operations and financial condition could be adversely affected. ​ The marketing of pharmaceutical and biopharmaceutical products and related arrangements with healthcare providers, third-party payors, patients and other third parties in the healthcare industry are subject to a wide range of healthcare laws and regulations within the U.S. and in foreign jurisdictions in which we operate.
New manufacturers would need to develop and implement the necessary production techniques and processes, which along with their facilities, would need to be inspected and approved by the regulatory authorities in each applicable territory. ​ If our partners or the third-party manufacturers we or our partners engage fail to adhere to applicable GMP or other regulatory requirements, experience delays or disruptions in the availability of raw materials or experience 41 Table of Contents manufacturing or distribution problems, we will suffer significant consequences, including product seizures or recalls, loss of product approval, fines and sanctions, reputational damage, shipment delays, inventory shortages, inventory write-offs and other product-related charges and increased manufacturing costs.
New manufacturers would need to develop and implement the necessary production techniques and processes, which along with their facilities, would need to be inspected and approved by the regulatory authorities in each applicable territory. ​ If our partners or the third-party manufacturers we or our partners engage fail to adhere to applicable GMP or other regulatory requirements, experience delays or disruptions in the availability of raw materials or experience manufacturing or distribution problems, we will suffer significant consequences, including product seizures or recalls, loss of product approval, fines and sanctions, reputational damage, shipment delays, inventory shortages, inventory write-offs and other product-related charges and increased manufacturing costs.
These advisors are not our employees and may have commitments to, or consulting or advisory contracts with, other entities that may limit their availability to us, or may 57 Table of Contents have arrangements with other companies to assist in the development and commercialization of products that may compete with ours. ​ Security breaches and other disruptions to our information technology structure could compromise our information, disrupt our business and expose us to liability, which would cause our business and reputation to suffer. ​ In the ordinary course of our business, we collect, process and store sensitive data, including intellectual property, our proprietary business information and that of our suppliers and business partners, as well as personally identifiable information of our patients, clinical trial participants and employees.
These advisors are not our employees and may have commitments to, or consulting or advisory contracts with, other entities that may limit their availability to us, or may have arrangements with other companies to assist in the development and commercialization of products that may compete with ours. ​ Security breaches and other disruptions to our information technology structure could compromise our information, disrupt our business and expose us to liability, which would cause our business and reputation to suffer. ​ In the ordinary course of our business, we collect, process and store sensitive data, including intellectual property, our proprietary business information and that of our suppliers and business partners, as well as personally identifiable information of our patients, clinical trial participants and employees.
Any cost-control initiatives, legislative and administrative or other healthcare system reforms aimed at controlling and reducing healthcare costs, including through measures designed to limit reimbursement, restrict access or impose unfavorable pricing modifications on pharmaceutical products, could impact our and our partners’ ability to obtain or maintain reimbursement for our products at satisfactory levels and could significantly decrease the available coverage and the price we have or might establish for our products and product candidates, which would have an adverse effect on our business and financial results. ​ We must work effectively and collaboratively with AbbVie to market and sell LINZESS in the U.S., and we must adapt our commercial model and market strategy to the evolving landscape for LINZESS to achieve its maximum commercial potential. ​ We are working closely with AbbVie to execute our joint commercialization plan for LINZESS.
Any cost-control initiatives, legislative and administrative or other healthcare system reforms aimed at controlling and reducing healthcare costs, including through measures designed to limit reimbursement, restrict access or impose unfavorable pricing modifications on pharmaceutical products, could impact our and our partners’ ability to obtain or maintain reimbursement for our products at satisfactory levels and could 29 Table of Contents significantly decrease the available coverage and the price we have or might establish for our products and product candidates, which would have an adverse effect on our business and financial results. ​ We must work effectively and collaboratively with AbbVie to market and sell LINZESS in the U.S., and we must adapt our commercial model and market strategy to the evolving landscape for LINZESS to achieve its maximum commercial potential. ​ We are working closely with AbbVie to execute our joint commercialization plan for LINZESS.
For example, with respect to apraglutide, a marketed GLP-2 product already exists in the U.S., E.U. and other international markets, which may or may not be genericized within the coming years. Additionally, it is possible that another investigational GLP-2 may be approved and launched in advance of the potential approval of apraglutide in the U.S., EMA and Japan.
For example, with respect to apraglutide, a marketed GLP-2 product already exists in the U.S., E.U. and other international markets, which may or may not be genericized within the coming years. Additionally, it is possible that other investigational GLP-2 products may be approved and launched in advance of the potential approval of apraglutide in the U.S., EMA and Japan.
In addition, in 2023, we entered into the Revolving Credit Facility. As of December 31, 2024, the outstanding principal balance on the Revolving Credit Facility was $385.0 million. We expect that for the next few years, at a minimum, the net quarterly payments from AbbVie will be a significant source of cash flows from operations.
In addition, in 2023, we entered into the Revolving Credit Facility. As of December 31, 2025, the outstanding principal balance on the Revolving Credit Facility was $385.0 million. We expect that for the next few years, at a minimum, the net quarterly payments from AbbVie will be a significant source of cash flows from operations.
If we or our partners are unsuccessful in any of the foregoing due to poor process, execution, systems, oversight, communication, adjudication or otherwise, then we may suffer any number of consequences, including the imposition of additional restrictions on the use of linaclotide, removal of linaclotide from the market, criminal prosecution, the imposition of civil monetary penalties, seizure of such products, or delay in approval of future products. ​ We rely entirely on contract manufacturers, our partners and other third parties to manufacture linaclotide, apraglutide, and our other product candidates and to distribute linaclotide.
If we or our partners are unsuccessful in any of the foregoing due to poor process, execution, systems, oversight, communication, adjudication or otherwise, then we may suffer any number of consequences, including the imposition of additional restrictions on the use of linaclotide, removal of linaclotide from the market, criminal prosecution, the imposition of civil monetary penalties, seizure of such products, or delay in approval of future products. ​ 39 Table of Contents We rely entirely on contract manufacturers, our partners and other third parties to manufacture linaclotide, apraglutide, and our other product candidates and to distribute linaclotide.
The amount and timing of our future funding requirements will depend on many factors, including, but not limited to: ​ ● the level of underlying demand and price we are able to charge for our products in the countries in which they are approved; ​ ● the costs associated with commercializing our products in the U.S.; 52 Table of Contents ● the costs of establishing, maintaining and/or expanding sales, marketing, distribution, and market access capabilities for our products; ​ ● the regulatory approval of linaclotide within new indications, populations and formulations, as well as the associated development and commercial milestones and royalties; ​ ● the regulatory approvals of apraglutide; ​ ● the rate of progress, the cost of our clinical trials and the other costs associated with our development programs, including our clinical trial of apraglutide in adult patients with SBS-IF, post-approval nonclinical and clinical studies of linaclotide in pediatrics and our investment to enhance the clinical profile of LINZESS within IBS-C and CIC, as well as to study linaclotide in additional indications, populations and formulations to assess its potential to treat various conditions; ​ ● the costs and timing of in-licensing additional products or product candidates or acquiring other complementary companies or assets; ​ ● the status, terms and timing of any collaboration, licensing, co-commercialization or other arrangements; ● whether the holders of our Convertible Senior Notes hold the notes to maturity without conversion into our Class A Common Stock or cash and whether we are required to repurchase any of our Convertible Senior Notes prior to maturity upon a fundamental change, as defined in each of the indentures governing the Convertible Senior Notes; and ​ ● whether we seek to redeem, repurchase or retire all or part of our outstanding debt through cash purchases and/or exchanges, in open market purchases, privately negotiated transactions, by tender offer or otherwise. ​ Additional funding may not be available on acceptable terms or at all.
The amount and timing of our future funding requirements will depend on many factors, including, but not limited to: ​ ● the level of underlying demand and price we are able to charge for our products in the countries in which they are approved; ​ 52 Table of Contents ● the costs associated with commercializing our products in the U.S.; ● the costs of establishing, maintaining and/or expanding sales, marketing, distribution, and market access capabilities for our products; ​ ● the regulatory approval of linaclotide within new indications, populations and formulations, as well as the associated development and commercial milestones and royalties; ​ ● the rate of progress, the cost of our clinical trials and the other costs associated with our development programs, including our planned confirmatory Phase III clinical trial of apraglutide in adult patients with SBS-IF, post-approval nonclinical and clinical studies of linaclotide in pediatrics and our investment to enhance the clinical profile of LINZESS, as well as to study linaclotide in additional indications, populations and formulations to assess its potential to treat various conditions; ​ ● the regulatory approval of apraglutide; ​ ● the costs and timing of in-licensing additional products or product candidates or acquiring other complementary companies or assets; ​ ● the status, terms and timing of any collaboration, licensing, co-commercialization or other arrangements; ● whether the holders of our Convertible Senior Notes hold the notes to maturity without conversion into our Class A Common Stock or cash and whether we are required to repurchase any of our Convertible Senior Notes prior to maturity upon a fundamental change, as defined in each of the indentures governing the Convertible Senior Notes; and ​ ● whether we seek to redeem, repurchase or retire all or part of our outstanding debt through cash purchases and/or exchanges, in open market purchases, privately negotiated transactions, by tender offer or otherwise. ​ Additional funding may not be available on acceptable terms or at all.
Any of the foregoing or other consequences could adversely impact our reputation, financial results and business. ​ 36 Table of Contents Even though linaclotide is approved for marketing in the U.S. and in a number of other countries, we or our partners may never receive approval to commercialize linaclotide in additional parts of the world. ​ In order to market any products outside of the countries where linaclotide is currently approved, we or our partners must comply with numerous and varying regulatory requirements of other jurisdictions regarding, among other things, safety and efficacy.
Any of the foregoing or other consequences could adversely impact our reputation, financial results and business. ​ Even though linaclotide is approved for marketing in the U.S. and in a number of other countries, we or our partners may never receive approval to commercialize linaclotide in additional parts of the world. ​ In order to market any products outside of the countries where linaclotide is currently approved, we or our partners must comply with numerous and varying regulatory requirements of other jurisdictions regarding, among other things, safety and efficacy.
As a result, a holder, or holders, controlling a majority of our capital stock are not able to call a special meeting. 58 Table of Contents ​ ● A super-majority (80%) of the outstanding shares of Class A Common Stock are required to amend our bylaws, which make it more difficult to change the provisions described above. ​ In addition, we are governed by the provisions of Section 203 of the Delaware General Corporation Law, which may prohibit certain business combinations with stockholders owning 15% or more of our outstanding voting stock.
As a result, a holder, or holders, controlling a majority of our capital stock are not able to call a special meeting. ​ ● A super-majority (80%) of the outstanding shares of Class A Common Stock are required to amend our bylaws, which make it more difficult to change the provisions described above. ​ In addition, we are governed by the provisions of Section 203 of the Delaware General Corporation Law, which may prohibit certain business combinations with stockholders owning 15% or more of our outstanding voting stock.
FDA to understand the safety and efficacy of LINZESS in pediatric patients. In June 2023, the U.S. FDA approved LINZESS as a once-daily oral treatment for pediatric patients ages 6-17 years-old with FC, making LINZESS the first and only FDA-approved prescription therapy for FC in this patient population.
FDA to understand the safety and efficacy of LINZESS in pediatric patients. In June 2023, the U.S. FDA approved LINZESS as a once-daily oral treatment for pediatric patients ages 6-17 years-old with FC, making LINZESS the first and only U.S. FDA-approved prescription therapy for FC in this patient population. In November 2025, the U.S.
Additionally, the IRA, through a newly established Manufacturer Discount Program, eliminated, effective January 1, 2025, the size of the discount on brand-name drugs that pharmaceutical manufacturers are required to offer Medicare beneficiaries who are in the Medicare Part D coverage gap, or “donut hole,” by significantly lowering the beneficiary maximum out-of-pocket cost and requiring pharmaceutical manufacturers to provide a 10% discount in the initial coverage phase of the plan and 20% discount in the catastrophic coverage phase of the plan on brand-name drugs. ​ In addition, the IRA requires Medicare to negotiate prices for certain high-cost drugs and biologicals, including both physician-administered products covered under Medicare Part B benefit and self-administered drugs covered under the Medicare Part D benefit.
Additionally, the IRA, through the Manufacturer Discount Program, eliminated, effective January 1, 2025, the size of the discount on brand-name drugs that pharmaceutical manufacturers are required to offer Medicare beneficiaries who are in the Medicare Part D coverage gap, or “donut hole,” by significantly lowering the beneficiary maximum out-of-pocket cost and requiring pharmaceutical manufacturers to provide a 10% discount in the initial coverage phase of the plan and 20% discount in the catastrophic coverage phase of the plan on brand-name drugs. ​ In addition, the IRA requires Medicare to negotiate prices for certain high-cost drugs and biologics, including both physician-administered products covered under Medicare Part B benefit and self-administered drugs covered under the Medicare Part D benefit.
In addition, regardless of merit or eventual outcome, product liability claims may result in: ​ ● decreased demand for approved products; ​ ● impairment of our business reputation; ​ ● withdrawal of clinical trial participants; ​ ● initiation of investigations by regulators; ​ ● litigation costs; ​ ● distraction of management’s attention from our primary business; ​ ● substantial monetary awards to patients or other claimants; ​ ● loss of revenues; and ​ ● the inability to commercialize our product candidates.
In addition, regardless of merit or eventual outcome, product liability claims may result in: ​ ● decreased demand for approved products; ​ ● impairment of our business reputation; 42 Table of Contents ​ ● withdrawal of clinical trial participants; ​ ● initiation of investigations by regulators; ​ ● litigation costs; ​ ● distraction of management’s attention from our primary business; ​ ● substantial monetary awards to patients or other claimants; ​ ● loss of revenues; and ​ ● the inability to commercialize our product candidates.
Additionally, with respect to our approved products, as patient experience increases and expands, or if one or more of our product candidates receives marketing approval, we, our partners, or others may later identify previously unknown side effects, known side effects may be found to be more frequent and/or severe than in the past, or detect unexpected safety signals for our products or any products perceived to be similar to our products.
Additionally, with respect to our approved products, as patient experience increases and 34 Table of Contents expands, or if one or more of our product candidates receives marketing approval, we, our partners, or others may later identify previously unknown side effects, known side effects may be found to be more frequent and/or severe than in the past, or detect unexpected safety signals for our products or any products perceived to be similar to our products.
In June 2023, the U.S. FDA approved LINZESS as a once-daily treatment for pediatric patients ages 6-17 years-old with FC, making LINZESS the first and only FDA-approved prescription therapy for FC in this patient population.
In June 2023, the U.S. FDA approved LINZESS as a once-daily treatment for pediatric patients ages 6-17 years-old with FC, making LINZESS the first and only U.S. FDA-approved prescription therapy for FC in this patient population. In October 2025, the U.S.
Additionally, new developments, including the development of other drug technologies and methods of preventing the incidence of disease, occur in the pharmaceutical and medical technology industries at a rapid pace. These developments may render our products obsolete or noncompetitive. ​ Linaclotide competes with certain prescription therapies and OTC products, some of which have attained significant levels of market acceptance.
Additionally, new developments, including the development of other drug technologies and methods of preventing the incidence of disease, occur in the pharmaceutical and medical technology industries at a rapid pace. These developments may render our products obsolete or non-competitive. ​ Linaclotide competes with certain prescription therapies and OTC products, some of which have attained significant levels of market acceptance.
Termination of the agreement or reduction or elimination of our rights under the agreement may also result in us being required to negotiate a new or reinstated agreement with less favorable terms, and it is possible that we may be unable to obtain any such additional license at a reasonable cost or on reasonable terms and will be unable to develop and commercialize apraglutide.
Termination of the agreement or reduction or elimination of our rights under the agreement may also result in us being required to negotiate a new or reinstated agreement with less favorable terms, and it is possible that we may be unable to obtain any such additional license at a reasonable cost or on reasonable terms and 49 Table of Contents will be unable to develop and commercialize apraglutide.
State laws may also require disclosure of pharmaceutical pricing information and marketing expenditures. Certain state and local laws require the registration of pharmaceutical sales representatives. Additionally, some 44 Table of Contents individual states have begun establishing Prescription Drug Affordability Boards (or similar entities) to review high-cost drugs and, in some cases, set upper payment limits.
State laws may also require disclosure of pharmaceutical pricing information and marketing expenditures. Certain state and local laws require the registration of pharmaceutical sales representatives. Additionally, some individual states have begun establishing Prescription Drug Affordability Boards (or similar entities) to review high-cost drugs and, in some cases, set upper payment limits.
Orphan drug designation neither shortens the development time or regulatory review time of a drug nor gives the drug any advantage in the regulatory review or approval process. 50 Table of Contents We have received notices of Paragraph IV certifications related to LINZESS in conjunction with ANDAs filed by generic drug manufacturers, and we may receive additional notices from others in the future.
Orphan drug designation neither shortens the development time or regulatory review time of a drug nor gives the drug any advantage in the regulatory review or approval process. We have received notices of Paragraph IV certifications related to LINZESS in conjunction with ANDAs filed by generic drug manufacturers, and we may receive additional notices from others in the future.
Any delay or disruption in the availability of raw materials or a change in raw material suppliers could result in production disruptions, delays or higher costs with consequent adverse effects on us. ​ The manufacture of pharmaceutical products requires significant expertise and capital investment, including the development of advanced manufacturing techniques and process controls.
Any delay or disruption in 40 Table of Contents the availability of raw materials or a change in raw material suppliers could result in production disruptions, delays or higher costs with consequent adverse effects on us. ​ The manufacture of pharmaceutical products requires significant expertise and capital investment, including the development of advanced manufacturing techniques and process controls.
Prior to the year ended December 31, 2019, we incurred net losses in each year since our inception in 1998. As of December 31, 2024, we had an accumulated deficit of approximately $1.7 billion.
Prior to the year ended December 31, 2019, we incurred net losses in each year since our inception in 1998. As of December 31, 2025, we had an accumulated deficit of approximately $1.7 billion.
Developing and obtaining regulatory approval for combination products can pose unique challenges because they involve components that are regulated under different types of regulatory requirements and potentially by different U.S. FDA centers or regulatory authorities. As a result, combination product candidates may raise regulatory, policy and review challenges.
Developing and obtaining regulatory approval for combination products can pose unique challenges because they involve components that are regulated under different types of 31 Table of Contents regulatory requirements and potentially by different U.S. FDA centers or regulatory authorities. As a result, combination product candidates may raise regulatory, policy and review challenges.
Our failure to successfully develop and commercialize additional product candidates or approved products would impair our ability to grow and/or adversely affect our business. As part of our growth strategy, we intend to explore further linaclotide development opportunities as well as to advance the development of our other pipeline programs, such as apraglutide, through internal or external opportunities.
Our failure to successfully develop and commercialize additional product candidates or approved products would impair our ability to grow and/or adversely affect our business. We intend to explore further linaclotide development opportunities as well as to advance the development of our other pipeline programs, such as apraglutide, through internal or external opportunities.
Such adjustments could have an adverse effect on our financial results, which could lead to a decline in our Class A Common Stock price. 59 Table of Contents ​ If in the future we cannot conclude that we have effective internal control over our financial reporting, or if our independent registered public accounting firm is unable to provide an unqualified opinion regarding the effectiveness of our internal control over financial reporting, investors could lose confidence in the reliability of our financial statements, which could lead to a decline in our stock price.
Such adjustments could have an adverse effect on our financial results, which could lead to a decline in our Class A Common Stock price. ​ If we cannot conclude that we have effective internal control over our financial reporting, or if our independent registered public accounting firm is unable to provide an unqualified opinion regarding the effectiveness of our internal control over financial reporting, investors could lose confidence in the reliability of our financial statements, which could lead to a decline in our stock price.
Should we, or any of our partners or any third-party manufacturers we or our partners engage, experience setbacks or challenges in our manufacturing efforts, our development and commercialization efforts may be materially harmed. ​ 40 Table of Contents Each of our partners and the third-party manufacturers we or our partners engage, must comply with GMP and other stringent regulatory requirements enforced by the U.S.
Should we, or any of our partners or any third-party manufacturers we or our partners engage, experience setbacks or challenges in our manufacturing efforts, our development and commercialization efforts may be materially harmed. ​ Each of our partners and the third-party manufacturers we or our partners engage, must comply with GMP and other stringent regulatory requirements enforced by the U.S.
Any such transition might result in a period of reduced efficiency or performance by our operations and commercialization teams, which could adversely affect our ability to commercialize LINZESS. ​ We do not have certain operational capabilities outside of the U.S.
Any such transition might result in a 41 Table of Contents period of reduced efficiency or performance by our operations and commercialization teams, which could adversely affect our ability to commercialize LINZESS. ​ We do not have certain operational capabilities outside of the U.S.
Even if we do receive such regulatory approval, we may be unable to successfully commercialize apraglutide within any approved indications or develop apraglutide for the treatment of additional indications, which would materially adversely impact our business and prospects.
Even if we do receive such regulatory approval, we may be unable to successfully commercialize 30 Table of Contents apraglutide within any approved indications or develop apraglutide for the treatment of additional indications, which would materially adversely impact our business and prospects.
The commercial success of LINZESS depends on a number of factors, including: ​ ● the effectiveness of LINZESS as a treatment for adult patients with IBS-C, or CIC, and as a treatment for pediatric patients aged 6-17 years-old with FC; ​ ● the size of the treatable patient population; ​ ● the effectiveness of the sales, managed markets and marketing efforts , including the ability to adapt a commercial model and market strategy to the evolving landscape; ​ ● the coverage and reimbursement levels set by governmental authorities, private health insurers and other third-party payors; ​ ● the status of government regulation in the life sciences industry, particularly with respect to healthcare reform and drug pricing; ​ ● the adoption of LINZESS by physicians, which depends on whether physicians view it as a safe and effective treatment for adult patients with IBS-C and CIC and pediatric patients ages 6-17 years-old with FC; ​ ● our success in educating and activating adult IBS-C and CIC patients, and children and adolescents ages 6-17 years-old FC patients and their caregivers, to seek physician care for their symptoms; ​ ● our ability to both secure and maintain adequate reimbursement for, and optimize patient access to, LINZESS and our ability to demonstrate that LINZESS is safer, more efficacious and/or more cost-effective than alternative therapies; ​ ● the effectiveness of our partners’ distribution networks; ​ ● the occurrence of any side effects, adverse reactions or misuse, or any unfavorable publicity in these or other areas, associated with linaclotide; and ​ ● the development or commercialization of products or therapies that compete with LINZESS. ​ Our revenues from the commercialization of LINZESS are subject to these and other factors, and therefore has been and may be unpredictable from quarter-to-quarter and year-to-year. ​ 26 Table of Contents We are subject to uncertainty relating to pricing and reimbursement policies in the U.S., including recent and future healthcare reform measures, which, if not favorable for our products, could hinder or prevent our products’ commercial success. ​ Our and our partner’s ability to commercialize our products successfully depends in part on the coverage and reimbursement levels set by governmental authorities, private health insurers and other third-party payors.
The commercial success of LINZESS depends on a number of factors, including: ​ ● the effectiveness of LINZESS as a treatment in the approved indications; 26 Table of Contents ​ ● the size of the treatable patient population; ​ ● the effectiveness of the sales, managed markets and marketing efforts, including the ability to adapt a commercial model and market strategy to the evolving landscape; ​ ● the coverage and reimbursement levels set by governmental authorities, private health insurers and other third-party payors; ​ ● the status of government regulation in the life sciences industry, particularly with respect to healthcare reform and drug pricing; ​ ● the adoption of LINZESS by physicians and other healthcare providers, which depends on whether LINZESS is viewed as a safe and effective treatment in the approved indications; ​ ● our success in educating and activating adult and pediatric patients 7 years of age and older with IBS-C, adult patients with CIC patients, and pediatric patients ages 6-17 years-old with FC and their caregivers, to seek physician care for their symptoms; ​ ● our ability to both secure and maintain adequate reimbursement for, and optimize patient access to, LINZESS and our ability to demonstrate that LINZESS is safer, more efficacious and/or more cost-effective than alternative therapies; ​ ● the effectiveness of our partners’ distribution networks; ​ ● the occurrence of any side effects, adverse reactions or misuse, or any unfavorable publicity in these or other areas, associated with linaclotide; and ​ ● the development or commercialization of products or therapies that compete with LINZESS. ​ Our revenues from the commercialization of LINZESS are subject to these and other factors, and therefore our revenues have been and may be unpredictable from quarter-to-quarter and year-to-year. ​ We are subject to uncertainty relating to pricing and reimbursement policies in the U.S., including recent and future healthcare reform measures, which, if not favorable for our products, could hinder or prevent our products’ commercial success. ​ Our and our partner’s ability to commercialize our products successfully depends in part on the coverage and reimbursement levels set by governmental authorities, private health insurers and other third-party payors.
Certain future equity offerings or strategic transactions, if any, could potentially result in a 50% or greater change of control. ​ If we do not generate sufficient taxable income prior to the expiration, if any, of the applicable carryforwards or if the carryforwards are subject to the limitations described above, we may be unable to offset our taxable income with losses, or our tax liability with credits, before such losses and credits expire and therefore would incur larger federal or state income tax liability.
Certain future equity offerings or strategic transactions, if any, could potentially result in a 50% or greater ownership change. ​ If we do not generate sufficient taxable income prior to the expiration, if any, of the applicable carryforwards or if the carryforwards are subject to the limitations described above, we may be unable to offset our taxable income with losses, or our tax liability with credits, before such losses and credits expire and therefore would incur larger federal or 56 Table of Contents state income tax liability.
These provisions may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect such acquirer’s own slate of directors or otherwise attempting to obtain control of our company. ​ ● Our stockholders may not act by written consent.
These provisions may discourage or 58 Table of Contents deter a potential acquirer from conducting a solicitation of proxies to elect such acquirer’s own slate of directors or otherwise attempting to obtain control of our company. ​ ● Our stockholders may not act by written consent.
Manufacturers who fail to negotiate or offer the MFP can face significant civil money penalties or excise tax liability on sales of that drug. ​ In 2024, HHS published the results of the first Medicare drug price negotiations for ten selected drugs that treat a range of conditions, including diabetes, chronic kidney disease, and rheumatoid arthritis, and the prices of the selected drugs will become effective on January 1, 2026.
Manufacturers who fail to negotiate or offer the MFP can face significant civil money penalties or excise tax liability on sales of that drug. ​ In 2024, HHS published the results of the first Medicare drug price negotiations for 10 selected drugs that treat a range of conditions, including diabetes, chronic kidney disease, and rheumatoid arthritis, and the prices of the selected drugs became effective on January 1, 2026.
FDA, EMA or other comparable foreign regulatory authorities may disagree with the design or implementation of our clinical trials or with our interpretation of data from preclinical studies or clinical 30 Table of Contents trials; ● the population studied in the clinical program may not be sufficiently broad or representative to assure safety or efficacy in the full population for which we seek approval; ● the data collected from our clinical trials may not be sufficient to support the submission of an NDA, MMA, or other submission or to obtain regulatory approval in the U.S., Europe or elsewhere; ● participants in our clinical trials or individuals using drugs similar to our product candidates may experience serious and unexpected drug-related side effects; ● we may be unable to demonstrate to the U.S.
FDA, EMA or other comparable foreign regulatory authorities may disagree with the design or implementation of our clinical trials or with our interpretation of data from preclinical studies or clinical trials; ● the population studied in the clinical program may not be sufficiently broad or representative to assure safety or efficacy in the full population for which we seek approval; ● the data collected from our clinical trials may not be sufficient to support the submission of an NDA, MMA, or other submission or to obtain regulatory approval in the U.S., Europe or elsewhere; ● we may need to perform additional or unanticipated clinical trials; ● participants in our clinical trials or individuals using drugs similar to our product candidates may experience serious and unexpected drug-related side effects; ● we may be unable to demonstrate to the U.S.
Congress, the federal courts, the USPTO, and their foreign counterparts, the laws and regulations governing patents may change, or their interpretation or implementation may change, in unpredictable ways that could impact, potentially adversely, our ability to obtain new patents or to enforce and defend patents that we have already obtained or that we might obtain in the 47 Table of Contents future.
Congress, the federal courts, the USPTO, and their foreign counterparts, the laws and regulations governing patents may change, or their interpretation or implementation may change, in unpredictable ways that could impact, potentially adversely, our ability to obtain new patents or to enforce and defend patents that we have already obtained or that we might obtain in the future.
AbbVie is commercializing 39 Table of Contents LINZESS in Mexico and CONSTELLA in Canada as well as in certain countries including in Europe. Astellas and AstraZeneca are responsible for development and commercialization of LINZESS in Japan and China (including Hong Kong and Macau), respectively.
AbbVie is commercializing LINZESS in Mexico and CONSTELLA in Canada as well as in certain countries including in Europe. Astellas and AstraZeneca are responsible for development and commercialization of LINZESS in Japan and China (including Hong Kong and Macau), respectively.
Accordingly, since we cannot guarantee that our company will maintain net income or positive cash flows, we cannot provide assurances for any particular quarterly period that (i) we will have the available funds to fund the interest payment on our outstanding indebtedness, at a minimum, in the event that there is a deficiency in the net quarterly payment received from AbbVie, (ii) there will be a net quarterly payment from AbbVie at all or (iii) we will not also be required to make a true-up payment to AbbVie under the collaboration agreement for North America. ​ Our indebtedness could adversely affect our financial condition or restrict our future operations. ​ As of December 31, 2024, we had total indebtedness of $585.0 million and available cash and cash equivalents of $88.6 million. ​ We incurred significant new indebtedness in connection with the VectivBio Acquisition.
Accordingly, since we cannot guarantee that our company will maintain net income or positive cash flows, we cannot provide assurances for any particular quarterly period that (i) we will have the available funds to fund the interest payment on our outstanding indebtedness, at a minimum, in the event that there is a deficiency in the net quarterly payment received from AbbVie, (ii) there will be a net quarterly payment from AbbVie at all or (iii) we will not also be required to make a true-up payment to AbbVie under the collaboration agreement for North America. ​ 53 Table of Contents Our indebtedness could adversely affect our financial condition or restrict our future operations. ​ As of December 31, 2025, we had total indebtedness of $585.0 million and available cash and cash equivalents of $215.5 million. ​ We incurred significant new indebtedness in connection with the VectivBio Acquisition.
Certain of these cases are now on appeal and the Court of Appeals for the Third Circuit heard oral argument in three of these cases.
Most of these cases are now on appeal and the Court of Appeals for the Third Circuit heard oral argument in certain of these cases.
In addition, our business could be adversely affected if government healthcare programs, private health insurers, including managed care organizations, or other reimbursing bodies or payors limit or reduce the indications for or conditions under which our products may be reimbursed.
In addition, our business could be adversely affected if government healthcare programs, private health insurers, including managed care organizations, or other reimbursing bodies or payors limit or reduce the indications for or conditions under which our products may be 27 Table of Contents reimbursed.
Further, we expect to continue to incur substantial expenses in connection with our efforts to commercialize linaclotide and, if approved, apraglutide, research and develop our product candidates, and access externally developed products or product candidates.
Further, we expect to continue to incur substantial expenses in connection with our efforts to commercialize linaclotide and research, develop, and commercialize our product candidates, including apraglutide, and access externally developed products or product candidates.
Any delay in obtaining, or an inability to obtain, any marketing approvals would prevent us from commercializing our product candidates, including apraglutide, generating revenues on such product candidates and achieving and sustaining profitability. If any of these outcomes occur, we may be forced to abandon our development efforts for our product candidates, which could significantly and materially harm our business.
Any delay in obtaining, or an inability to obtain, any marketing approvals would prevent us from commercializing apraglutide, generating revenues and achieving and sustaining profitability. If any of these outcomes occur, we may be forced to abandon our development efforts for apraglutide, which could significantly and materially harm our business.
FDA approved LINZESS as a once-daily treatment for adult men and women suffering from IBS-C or CIC. Although we and AbbVie completed additional nonclinical studies and clinical trials in adults that were required by the U.S. FDA in connection with the approval of LINZESS, LINZESS remains subject to ongoing U.S.
FDA approved LINZESS as a once-daily treatment for adults suffering from IBS-C or CIC. Although we and AbbVie completed additional nonclinical studies and clinical trials in adults and pediatric patients that were required by the U.S. FDA in connection with the approval of LINZESS, LINZESS remains subject to ongoing U.S.
If reimbursement for linaclotide is unavailable in any country in which reimbursement is sought, limited in scope or amount, or if pricing is set at or reduced to unsatisfactory levels, our and our partners’ ability to successfully commercialize linaclotide in such country would be impacted negatively.
If reimbursement for linaclotide is unavailable in any country in which reimbursement is sought, limited in scope or amount, or if pricing is set at or reduced to unsatisfactory levels, our and our partners’ ability to successfully commercialize linaclotide in such country 36 Table of Contents would be impacted negatively.
An unfavorable outcome could require us to cease using the technology or to attempt to license rights to it from the prevailing party. Our business could be harmed if a prevailing party does not offer us a license on terms that are acceptable to us.
An unfavorable outcome could require us to cease using the technology or to attempt to license rights to 51 Table of Contents it from the prevailing party. Our business could be harmed if a prevailing party does not offer us a license on terms that are acceptable to us.
Other states have passed comprehensive privacy laws specifically regulating health information that may affect our business.
Other states have passed or may pass comprehensive privacy laws or laws specifically regulating health information that may affect our business.
FDA or EMA can subsequently approve the same drug with the same active moiety for the same condition if the U.S. FDA or EMA concludes that the later drug is safer, more effective, or makes a major contribution to patient care.
FDA or EMA can subsequently approve the same drug with the same active moiety for the same condition if the U.S. FDA or EMA concludes that the later drug is safer, more effective, or makes a 50 Table of Contents major contribution to patient care.
Due to our current limited income in Switzerland, there is a high risk that the tax loss carryforwards will expire 56 Table of Contents in part or in their entirety and will not be used to offset future taxable income.
Due to our current limited income in Switzerland, there is a high risk that the tax loss carryforwards will expire in part or in their entirety and will not be used to offset future taxable income.
CMS will publish the negotiated price, known as the MFP for each of the selected products. Manufacturers of selected drugs would be required to offer the drug for Medicare recipients at the MFP.
CMS will publish the negotiated price, known as the MFP, for each of the selected products. Manufacturers of selected drugs are required to offer the drug for Medicare recipients at the MFP.
If the Ferring Agreement is terminated, we could lose intellectual property rights that are important to our business, be liable for damages to the licensor or be prevented from developing and 49 Table of Contents commercializing our apraglutide.
If the Ferring Agreement is terminated, we could lose intellectual property rights that are important to our business, be liable for damages to the licensor or be prevented from developing and commercializing our apraglutide.
Apraglutide, if successfully developed and approved, will compete with companies that are commercializing or developing drugs for SBS, such as Takeda, which currently distributes the GLP-2 analog teduglutide, marketed as GATTEX® (teduglutide) in the U.S. and REVESTIVE® (teduglutide for injection) in Europe, and Zealand, which is developing glepaglutide, a long-acting GLP-2 analog, for the treatment of SBS for patients who are dependent on PS and is expecting to initiate an additional Phase III clinical trial in 2025.
Apraglutide, if successfully developed and approved, will compete with companies that are commercializing or developing drugs for SBS, such as Takeda, which currently distributes the GLP-2 analog teduglutide, marketed as GATTEX® (teduglutide) in the U.S. and REVESTIVE® (teduglutide for injection) in Europe, and Zealand, which is developing glepaglutide, a long-acting GLP-2 analog, for the treatment of SBS for patients who are dependent on PS and initiated an additional Phase III clinical trial in the first quarter of 2026.
We have completed several financings since our inception which may have resulted in a change in control as defined by Section 382, or could result in a change in control in the future. ​ Our ability to use foreign tax loss carryforwards acquired in the VectivBio Acquisition may be limited. ​ Prior to our acquisition of VectivBio, VectivBio incurred significant net losses since its inception.
We have completed several financings since our inception which may have resulted in an “ownership change,” as defined by Section 382, or could result in an ownership change in the future. ​ Our ability to use foreign tax loss carryforwards acquired in the VectivBio Acquisition may be limited. ​ Prior to our acquisition of VectivBio, VectivBio incurred significant net losses since its inception.
In addition, class action litigation has often been instituted 60 Table of Contents against companies whose securities have experienced periods of volatility. Any such litigation brought against us could result in substantial costs and a diversion of management attention, which could hurt our business, operating results and financial condition. ​ ​ ​
In addition, class action litigation has often been instituted against companies whose securities have experienced periods of volatility. Any such litigation brought against us could 60 Table of Contents result in substantial costs and a diversion of management attention, which could hurt our business, operating results and financial condition. ​ Item 1B. Unresolved Staff Comments None.
If we are unable to establish successful partnering arrangements when advantageous, we may not gain access to the financial resources and industry experience necessary to develop, commercialize or successfully market our products or product candidates, may be forced to curtail, delay or stop a development program or one or more of our other development programs, delay commercialization, reduce the scope of our planned sales or marketing activities or undertake development or commercialization activities at our own expense, and therefore may be unable to generate revenue from products or product candidates or do so to their full potential. ​ Risks Related to the VectivBio Acquisition We may be unable to successfully integrate the business and personnel of VectivBio, and may not realize the expected benefits and anticipated synergies of such acquisition. 38 Table of Contents In December 2023, we completed the VectivBio Acquisition.
If we are unable to establish successful partnering arrangements when advantageous, we may not gain access to the financial resources and industry experience necessary to develop, commercialize or successfully market our products or product candidates, may be forced to curtail, delay or stop a development program or one or more of our other development programs, delay commercialization, reduce the scope of our planned sales or marketing activities or undertake development or commercialization activities at our own expense, and therefore may be unable to generate revenue from products or product candidates or do so to their full potential. ​ Risks Related to the VectivBio Acquisition We may not realize the expected benefits and anticipated synergies of the VectivBio Acquisition.
The IRA contains various drug pricing and payment provisions. Among other provisions, the IRA imposes a yearly cap ($2,000 in 2025) on out-of-pocket prescription drug prices in Medicare Part D.
The IRA contains various drug pricing and payment provisions. Among other provisions, the IRA imposes a yearly cap ($2,100 in 2026) on out-of-pocket prescription drug prices in Medicare Part D.
In addition to the competition for personnel, the Boston area in particular is characterized by a high cost of living.
In addition to the competition for personnel, the Boston area in particular is 57 Table of Contents characterized by a high cost of living.
Additionally, our trade secrets could otherwise become known or be independently discovered by our competitors. ​ In addition, the laws of certain foreign countries do not protect proprietary rights to the same extent or in the same manner as the U.S., and, therefore, we or our partners may encounter problems in protecting and defending our intellectual property in certain foreign jurisdictions. ​ If we are sued for infringing intellectual property rights of third parties, it will be costly and time consuming, and an unfavorable outcome in such litigation could have a material adverse effect on our business. ​ Our commercial success depends on our ability, and the ability of our partners, to develop, manufacture, market and sell our products and use our proprietary technologies without infringing the proprietary rights of third parties.
Additionally, our trade secrets could otherwise become known or be independently discovered by our competitors. 47 Table of Contents ​ In addition, the laws of certain foreign countries do not protect proprietary rights to the same extent or in the same manner as the U.S., and, therefore, we or our partners may encounter problems in protecting and defending our intellectual property in certain foreign jurisdictions. ​ If we are sued for infringing intellectual property rights of third parties, it will be costly and time consuming, and an unfavorable outcome in such litigation could have a material adverse effect on our business. ​ Our commercial success depends on our ability, and the ability of our partners, to develop, manufacture, market and sell our products and use our proprietary technologies without infringing the proprietary rights of third parties. ​ Numerous U.S. and foreign issued patents and pending patent applications, which are owned by third parties, exist in the fields in which we and our partners are developing products.
Even if we believe the nonclinical or clinical data for our product candidates are sufficient to support approval, such data may not be considered sufficient to support approval by the U.S. FDA, EMA and other comparable foreign regulatory authorities. As an example, in December 2024, the U.S.
Even if we believe the nonclinical or clinical data for our product candidates are sufficient to support approval, such data may not be considered sufficient to support approval by the U.S. FDA, EMA and other comparable foreign regulatory authorities.
Chamber of Commerce, also filed lawsuits in various courts with similar constitutional claims against the HHS and CMS. HHS has generally won the substantive disputes in these cases, and various federal district court judges have expressed skepticism regarding the merits of the legal arguments being pursued by the pharmaceutical industry.
Subsequently, a number of other parties, including the U.S. Chamber of Commerce, also filed lawsuits in various courts with similar constitutional claims against the HHS and CMS. HHS has generally won the substantive disputes in these cases, and various federal district court judges have expressed skepticism regarding the merits of the legal arguments being pursued by the pharmaceutical industry.
Any limitations in our ability to use tax loss carryforwards to offset taxable income could adversely affect our financial condition. ​ If the distribution of the shares of Cyclerion Therapeutics, Inc., or Cyclerion, common stock in connection with the Separation is not generally tax- free for U.S. federal income tax purposes, we and our stockholders could be subject to significant tax liabilities. ​ The distribution of the shares of Cyclerion common stock in connection with the Separation, together with certain related transactions, is intended to qualify for tax-free treatment to us and our stockholders for U.S. federal income tax purposes.
Any limitations in our ability to use tax loss carryforwards to offset taxable income could adversely affect our financial condition. ​ If the distribution of the shares of Cyclerion Therapeutics, Inc., or Cyclerion, common stock in connection with the Separation is not generally tax- free for U.S. federal income tax purposes, we and our stockholders could be subject to significant tax liabilities. ​ The distribution of the shares of Cyclerion common stock in connection with the separation of our soluble guanylate cycle business, and certain other assets and liabilities, into Cyclerion, or the Separation, on April 1, 2019, together with certain related transactions, is intended to qualify for tax-free treatment to us and our stockholders for U.S. federal income tax purposes.
Risks we may face in connection with the VectivBio Acquisition include, among others: ● failure to successfully implement our business plans for the combined business, including the development of apraglutide for SBS patients who are dependent on PS; ● failure of the VectivBio Acquisition to further our business strategy as we expected, including the commercialization of apraglutide, if approved, for SBS patients who are dependent on PS; ● unexpected losses of key employees, customers or suppliers, and the complexities associated with integrating personnel from another company; ● unanticipated issues in conforming VectivBio’s standards, processes, procedures and controls with our operations; ● coordinating product candidate and process development; ● increasing the scope, geographic diversity and complexity of our operations; ● diversion of management’s attention from other business concerns; ● adverse effects on our or VectivBio’s existing business relationships; ● unanticipated changes in applicable laws and regulations; ● unanticipated expenses and liabilities associated with the VectivBio Acquisition; and ● other difficulties in the assimilation of VectivBio operations, technologies, product candidates and systems.
Risks we may face in connection with the VectivBio Acquisition include, among others: ● failure to successfully develop apraglutide for SBS patients who are dependent on PS; ● failure of the VectivBio Acquisition to further our business strategy as we expected, including the commercialization of apraglutide, if approved, for SBS patients who are dependent on PS; ● unexpected losses of key employees, customers or suppliers; ● unanticipated issues in conforming VectivBio’s standards, processes, procedures and controls with our operations; ● coordinating product candidate and process development; ● increasing the scope, geographic diversity and complexity of our operations; ● unanticipated changes in applicable laws and regulations; ● unanticipated expenses and liabilities associated with the VectivBio Acquisition; and ● other difficulties in the assimilation of VectivBio operations, technologies, product candidates and systems.
Failure to comply with reporting requirements could also subject us to sanctions and/or investigations by the SEC, The Nasdaq Stock Market or other regulatory authorities. ​ We expect that the price of our Class A Common Stock will fluctuate substantially. ​ The market price of our Class A Common Stock may be highly volatile due to many factors, including: ​ ● the commercial performance of our products in the countries in which they are approved, as well as the costs associated with such activities; ​ ● any third-party coverage and reimbursement policies for our products; ​ ● market conditions in the pharmaceutical and biotechnology sectors; ​ ● developments, litigation or public concern about the safety of our products or our potential products; ​ ● announcements of the introduction of new products by us or our competitors; ​ ● announcements concerning product development, including clinical trial results or timelines, or intellectual property rights of us or others; ​ ● actual and anticipated fluctuations in our quarterly and annual operating results; ​ ● deviations in our operating results from any guidance we may provide or the estimates of securities analysts; ​ ● sales of additional shares of our Class A Common Stock or sales of securities convertible into Class A Common Stock or the perception that these sales might occur; ​ ● any conversions of our Convertible Senior Notes into Class A Common Stock or activities undertaken by the counterparties to the Capped Calls; ​ ● additions or departures of key personnel; ​ ● developments concerning current or future collaboration, partnership, licensing or other strategic arrangements; ​ ● discussion of us or our stock price in the financial or scientific press or in online investor communities; ​ ● general economic, industry, and market conditions; and ​ ● the impact of public health epidemics, including containment or mitigation measures, or natural disasters. ​ Our business could be negatively affected as a result of a proxy contest or certain other stockholder actions. ​ Responding to certain stockholder actions can be costly, disruptive and time-consuming, and could also impact our ability to attract, retain and motivate our employees.
For further discussion of those material weaknesses and our remediation efforts, see Part II, Item 9A, under the heading “Controls and Procedures” in this Annual Report on Form 10-K. ​ We expect that the price of our Class A Common Stock will fluctuate substantially. ​ The market price of our Class A Common Stock may be highly volatile due to many factors, including: ​ ● the commercial performance of our products in the countries in which they are approved, as well as the costs associated with such activities; ​ ● any third-party coverage and reimbursement policies for our products; ​ ● market conditions in the pharmaceutical and biotechnology sectors; ​ ● developments, litigation or public concern about the safety of our products or our potential products; ​ ● announcements of the introduction of new products by us or our competitors; ​ ● announcements concerning product development, including clinical trial results or timelines or regulatory interactions, or intellectual property rights of us or others; ​ ● actual and anticipated fluctuations in our quarterly and annual operating results; ​ ● deviations in our operating results from any guidance we may provide or the estimates of securities analysts; ​ ● sales of additional shares of our Class A Common Stock or sales of securities convertible into Class A Common Stock or the perception that these sales might occur; ​ ● any conversions of our Convertible Senior Notes into Class A Common Stock or activities undertaken by the counterparties to the Capped Calls; ​ ● additions or departures of key personnel; ​ ● developments concerning current or future collaboration, partnership, licensing or other strategic arrangements; ​ ● discussion of us or our stock price in the financial or scientific press or in online investor communities; ​ ● general economic, industry, and market conditions; and ​ ● the impact of public health epidemics, geopolitical events or natural disasters. ​ Our business could be negatively affected as a result of a proxy contest or certain other stockholder actions. ​ Responding to certain stockholder actions can be costly, disruptive and time-consuming, and could also impact our ability to attract, retain and motivate our employees.
Further, we and AbbVie must continue to focus the sales and marketing efforts for the brand on educating customers about the relevant data and information for LINZESS in treating adults with IBS-C and CIC, and taking a measured approach to educating and raising awareness on the FC indication for pediatric patients ages 6-17 years-old.
Further, we and AbbVie must continue to focus the sales and marketing efforts for the brand on educating customers about the relevant data and information for LINZESS in treating adults and pediatric patients aged 7 years and older with IBS-C and adult patients with CIC, and taking a measured approach to educating and raising awareness on the FC and IBS-C indications for pediatric patients.
FDA to understand the safety and efficacy of LINZESS in pediatric patients. In June 2023, the U.S. FDA approved LINZESS, and in September 2024, Health Canada approved CONSTELLA, as once-daily treatments for pediatric patients ages 6-17 years-old with FC, in the U.S. and Canada, respectively. Additional clinical pediatric programs in IBS-C and FC are ongoing.
FDA to understand the safety and efficacy of LINZESS in pediatric patients. In June 2023, the U.S. FDA approved LINZESS, and in September 2024, Health Canada approved CONSTELLA, as once-daily treatments for pediatric patients ages 6-17 years-old with FC, in the U.S. and Canada, respectively. In November 2025, the U.S.
In February 2024, we announced positive topline results from our pivotal Phase III clinical trial, STARS, which evaluated the efficacy and safety of once-weekly subcutaneous apraglutide in reducing PS dependency in adult patients with SBS-IF.
In February 2024, we announced positive topline results from our pivotal Phase III clinical trial, STARS, which evaluated the efficacy and safety of once-weekly subcutaneous apraglutide in reducing PS dependency in adult patients with SBS-IF. However, in April 2025, we announced that, based on discussions with the U.S.
If we do not successfully defend ourselves against product liability 42 Table of Contents claims, we could incur substantial liabilities.
If we do not successfully defend ourselves against product liability claims, we could incur substantial liabilities.
FDA for the treatment of CIC in adults; Ardelyx’s IBSRELA™ (tenapanor) is approved by the U.S. FDA for the treatment for IBS-C in adults; and Vibrant Gastro Inc.’s Vibrant, a drug-free capsule, is approved by the U.S.
FDA for the treatment of CIC in adults and generic versions have been available in the U.S. since January 2025; Ardelyx’s IBSRELA™ (tenapanor) is approved by the U.S. FDA for the treatment for IBS-C in adults; and Vibrant Gastro Inc.’s Vibrant, a drug-free capsule, is approved by the U.S.
Additional U.S. patents related to LINZESS include multiple patents relating to our commercial, room temperature stable formulations of the 72 mcg, 145 mcg and 290 mcg doses of linaclotide and methods of using these formulations, the latest of which expires in the early 2030s, as well as other patents and patent applications covering formulations of linaclotide, and molecules related to linaclotide. ​ In addition, we have exclusive rights to apraglutide including issued composition of matter and method of use patents in the U.S. in lead indications.
Additional U.S. patents related to LINZESS include multiple patents relating to our commercial, room temperature stable formulations of the 72 mcg, 145 mcg and 290 mcg doses of linaclotide and methods of using these formulations, the latest of which expires in the early 2030s, as well as other patents and patent applications covering formulations of linaclotide, and molecules related to linaclotide.
Any action against us for violation of these laws, rules or regulations, even if we successfully defend against it, could cause us to incur significant legal expenses and divert our management’s attention from the operation of our business, as well as damage our business or reputation. ​ The VectivBio Acquisition increases our exposure to doing business in foreign jurisdictions. 46 Table of Contents Following the VectivBio Acquisition, we retained VectivBio’s legacy headquarters in Basel, Switzerland and, as a result, we now have employees and operations in foreign jurisdictions.
Any action against us for violation of these laws, rules or regulations, even if we successfully defend against it, could cause us to incur significant legal expenses and divert our management’s attention from the operation of our business, as well as damage our business or reputation. ​ The VectivBio Acquisition increases our exposure to doing business in foreign jurisdictions.
These laws and regulations may constrain our business and/or financial arrangements.
These laws and 43 Table of Contents regulations may constrain our business and/or financial arrangements.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeFor more information on our cybersecurity-related risks, see Item 1A, Risk Factors , elsewhere in this Annual Report on Form 10-K. The Company’s Senior Vice President, Controller and Principal Accounting Officer is responsible for managerial oversight of our cybersecurity program and reporting on cybersecurity matters to the Audit Committee of the Board of Directors and management.
Biggest changeFor more information on our cybersecurity-related risks, see Item 1A, Risk Factors , elsewhere in this Annual Report on Form 10-K. The Company’s Senior Vice President, Corporate Controller & Chief Accounting Officer is responsible for managerial oversight of our cybersecurity program and reporting on cybersecurity matters to the Audit Committee of the Board of Directors and management.
We leverage third-party security services for audit, benchmarking, and improvement and use various tools and methodologies to manage cybersecurity risks that are tested regularly, including a cybersecurity assessment guided by the National Institute of Standards and Technology (NIST) cybersecurity framework and ongoing security awareness training. We oversee third-party service providers by conducting vendor diligence upon onboarding and ongoing monitoring.
We leverage third-party security services for audit, benchmarking, and improvement and use various tools and methodologies to manage cybersecurity risks that are tested regularly, including a cybersecurity assessment guided by the National Institute of Standards and Technology cybersecurity framework and ongoing security awareness training. We oversee third-party service providers by conducting vendor diligence upon onboarding and ongoing monitoring.
Our Senior Vice President, Controller and Principal Accounting Officer oversees the cybersecurity team, which include members of our internal IT department and is also supported by third-party service providers. Our Board of Directors is responsible for overseeing our enterprise risk management activities in general, and each of our Board committees assists the Board in the role of risk oversight.
Our Senior Vice President, Corporate Controller & Chief Accounting Officer oversees the cybersecurity team, which include members of our internal IT department and is also supported by third-party service providers. Our Board of Directors is responsible for overseeing our enterprise risk management activities in general, and each of our Board committees assists the Board in the role of risk oversight.
The Audit Committee of the Board of Directors oversees our cybersecurity risk and receives regular reports, with a minimum frequency of once per year, from our Senior Vice President, Controller and Principal Accounting Officer on various cybersecurity matters, including risk assessments, mitigation strategies, areas of emerging risks, incidents and industry trends, and other areas of importance.
The Audit Committee of the Board of Directors oversees our cybersecurity risk and receives regular reports, with a minimum frequency of once per year, from our Senior Vice President, Corporate Controller & Chief Accounting Officer on various cybersecurity matters, including risk assessments, mitigation strategies, areas of emerging risks, incidents and industry trends, and other areas of importance.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties Our corporate headquarters are located in Boston, Massachusetts, where, as of December 31, 2024, we occupied approximately 39,000 square feet of office space under our lease expiring in June 2030. We also have operations in Basel, Switzerland. We believe that our facilities are suitable and adequate for our needs for the foreseeable future. ​
Biggest changeItem 2. Properties Our corporate headquarters are located in Boston, Massachusetts, where, as of December 31, 2025, we occupied approximately 39,000 square feet of office space under our lease expiring in June 2030. We also have operations in Basel, Switzerland.
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We believe that our facilities are suitable and adequate for our needs for the foreseeable future. 61 Table of Contents ​

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures 63 ​ ​ ​ ​ PART II ​ Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 64 Item 6. [Reserved] 65 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 66 Item 7A. Quantitative and Qualitative Disclosures about Market Risk 80 Item 8.
Biggest changeItem 4. Mine Safety Disclosures 62 ​ ​ ​ ​ PART II ​ Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 63 Item 6. [Reserved] 63 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 64 Item 7A. Quantitative and Qualitative Disclosures about Market Risk 76 Item 8.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeAs of January 31, 2025, there were 29 stockholders of record of our Class A Common Stock.
Biggest changeAs of January 31, 2026, there were 29 stockholders of record of our Class A Common Stock.
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Corporate Performance Graph The following performance graph and related information shall not be deemed to be “soliciting material” or to be “filed” with the SEC, nor shall such information be incorporated by reference into any future filing under the Securities Act of 1933, as amended, except to the extent that we specifically incorporate it by reference into such filing.
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Performance Graph We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934, as amended, and are not required to provide a performance graph.
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The following graph compares the performance of our Class A Common Stock to the Nasdaq U.S. Benchmark Index and to the Nasdaq Biotechnology Index from December 31, 2019 through December 31, 2024.
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The comparison assumes $100 was invested after the market closed on December 31, 2019 in our Class A Common Stock and in each of the presented indices, and it assumes reinvestment of dividends, if any.
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The stock price performance included in this graph is not necessarily indicative of future stock price performance. ​ 64 Table of Contents COMPARISON OF 5-YEAR CUMULATIVE TOTAL RETURN Among The Nasdaq U.S. Benchmark Index, the Nasdaq Biotechnology Index, and Ironwood Pharmaceuticals, Inc. ​ ​ ​ ​

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe decrease in research and development expenses of $4.7 million for the year ended December 31, 2024 compared to the year ended December 31, 2023 was primarily related to $11.3 million of share-based compensation expense and $3.5 million in related payroll taxes recognized in the second quarter of 2023 immediately after the closing of the VectivBio Acquisition in connection with the vesting acceleration of outstanding stock options and RSUs under VectivBio’s 2021 Equity Incentive Plan, a $6.0 million payment to COUR in the second quarter of 2023 related to CNP-104 in connection with the amendment of the COUR Collaboration Agreement, a $4.8 million reduction to research and development expense in connection with the settlement of a license-related contract liability, and a $2.5 million decrease in external linaclotide costs, partially offset by a $15.9 million increase of apraglutide program costs, a $6.0 million increase in compensation, benefits, and other employee-related expenses, and a $2.0 million increase related to an amendment of the COUR Collaboration Agreement. ​ Selling, general and administrative.
Biggest changeThe decrease in research and development expenses of $16.3 million for the year ended December 31, 2025 compared to the year ended December 31, 2024 was primarily related to $9.6 million decrease in external apraglutide costs, a $5.9 million decrease in costs associated with the IW-3300 development program, a $2.8 million decrease in costs associated with the COUR Collaboration Agreement, and a $1.8 million decrease in external linaclotide costs, partially offset by a $4.8 million reduction to research and development expense recognized during the first quarter of 2024 in connection with the settlement of a license-related contract liability. ​ Selling, general and administrative.
Our funding requirements will depend on many factors, including, but not limited to, the following: ​ ● the revenue generated by sales of LINZESS and CONSTELLA and from any other sources; ​ ● the rate of progress and cost of our commercialization activities, including the expense we incur in marketing and selling LINZESS in the U.S. and from any other sources; ​ ● the success of our third-party manufacturing activities; ​ ● the time and costs involved in developing, and obtaining regulatory approvals for, our product candidates, including apraglutide, as well as the timing and cost of any post-approval development and regulatory requirements; ​ ● the time and costs associated with commercial manufacturing, sales, marketing and distribution of apraglutide, if approved; ​ ● the success of our research and development efforts; ​ ● the emergence of competing or complementary products; ​ ● the costs of filing, prosecuting, defending and enforcing any patent claims and other intellectual property rights; 79 Table of Contents ​ ● the terms and timing of any collaborative, licensing or other arrangements that we may establish, including milestones, royalties or other payments due or payable under such agreements; ​ ● the settlement method used for our outstanding convertible notes; and ​ ● the acquisition of businesses, products and technologies and the impact of other strategic transactions, as well as the cost and timing of evaluating, acquiring, and, if completed, integrating into our business operations any such assets. ​ Financing Strategy ​ We may, from time to time, consider additional funding through a combination of new collaborative arrangements, strategic alliances, and additional equity and debt financings or from other sources.
Our funding requirements will depend on many factors, including, but not limited to, the following: ​ ● the revenue generated by sales of LINZESS and CONSTELLA and from any other sources; ​ 75 Table of Contents ● the rate of progress and cost of our commercialization activities, including the expense we incur in marketing and selling LINZESS in the U.S. and from any other sources; ​ ● the success of our third-party manufacturing activities; ​ ● the time and costs involved in developing, and obtaining regulatory approvals for, our product candidates, including apraglutide, as well as the timing and cost of any post-approval development and regulatory requirements; ​ ● the time and costs associated with commercial manufacturing, sales, marketing and distribution of apraglutide, if approved; ​ ● the success of our research and development efforts; ​ ● the emergence of competing or complementary products; ​ ● the costs of filing, prosecuting, defending and enforcing any patent claims and other intellectual property rights; ​ ● the terms and timing of any collaborative, licensing or other arrangements that we may establish, including milestones, royalties or other payments due or payable under such agreements; ​ ● the settlement method used for our outstanding convertible notes; and ​ ● the acquisition of businesses, products and technologies and the impact of other strategic transactions, as well as the cost and timing of evaluating, acquiring, and, if completed, integrating into our business operations any such assets. ​ Financing Strategy ​ We may, from time to time, consider additional funding through a combination of new collaborative arrangements, strategic alliances, and additional equity and debt financings or from other sources.
Cash Flows from Financing Activities Cash used in financing activities for the year ended December 31, 2024 totaled $ 107.0 million was comprised primarily of the repayment of $200.0 million aggregate principal on the 2024 Convertible Notes upon their maturity in June 2024, partially offset by $85.0 million of net borrowings under the Revolving Credit Facility and $11.0 million from stock option exercises and employee stock purchases.
Cash used in financing activities for the year ended December 31, 2024 totaled $107.0 million was comprised primarily of the repayment of $200.0 million aggregate principal on the 2024 Convertible Notes upon their maturity in June 2024, partially offset by $85.0 million of net borrowings under the Revolving Credit Facility and $11.0 million from stock option exercises and employee stock purchases.
We are focused on the development and commercialization of innovative GI product opportunities in areas of significant unmet need, leveraging our demonstrated expertise and capabilities in GI diseases. ​ LINZESS ® (linaclotide), our commercial product, is the first product approved by the U.S.
We are focused on the development and commercialization of innovative product opportunities in areas of significant unmet need, leveraging our demonstrated expertise and capabilities in GI and rare diseases. ​ LINZESS ® (linaclotide), our commercial product, is the first product approved by the U.S.
For additional information refer to Note 14, Income Taxes, to our consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K. ​ Critical Accounting Policies and Estimates Our discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles.
For additional information refer to Note 13, Income Taxes, to our consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K. ​ Critical Accounting Policies and Estimates Our discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles.
Any change in these factors could result in the recognition of a tax benefit or an additional charge to the tax provision. Defined Benefit Pension Plan Determining pension expense and obligations for our defined benefit pension plan uses actuarial estimates of participants’ age at retirement, life span, the long-term rate of return on investments and other factors.
Any change in these factors could result in the recognition of a tax benefit or an additional charge to the tax provision. Defined Benefit Pension Plan Determining pension expense and obligations for our defined benefit pension plan uses actuarial estimates of participants’ age at retirement, life span, the long-term rate of return on assets and other factors.
We are unable to predict the extent of any future losses or guarantee that our company will be able to maintain positive cash flows. ​ We were incorporated in Delaware on January 5, 1998 as Microbia, Inc. On April 7, 2008, we changed our name to Ironwood Pharmaceuticals, Inc.
We are unable to predict the extent of any future losses or guarantee that our company will be able to generate and maintain positive cash flows. ​ We were incorporated in Delaware on January 5, 1998 as Microbia, Inc. On April 7, 2008, we changed our name to Ironwood Pharmaceuticals, Inc.
These expenses consist primarily of compensation, benefits and other employee-related expenses, research and development related facility costs, third-party contract costs relating to nonclinical study and clinical trial activities, development of manufacturing processes, regulatory registration of third-party manufacturing facilities, and licensing fees for our product candidates. ​ Research and development expenses include amounts owed to AbbVie on an ongoing basis under cost-sharing 67 Table of Contents provisions in our collaboration agreement for linaclotide.
These expenses consist primarily of compensation, benefits and other employee-related expenses, research and development related facility costs, third-party contract costs relating to nonclinical study and clinical trial activities, development of manufacturing processes, regulatory registration of third-party manufacturing facilities, and licensing fees for our product candidates. ​ Research and development expenses include amounts owed to AbbVie on an ongoing basis under cost-sharing provisions in our collaboration agreement for linaclotide.
FDA and comparable foreign agencies impose substantial and varying requirements on the introduction of therapeutic pharmaceutical products, typically requiring lengthy and detailed laboratory and clinical testing procedures, sampling activities and other costly and time-consuming procedures ; ​ 69 Table of Contents ● Data obtained from nonclinical and clinical activities at any step in the testing process may be adverse and lead to discontinuation or redirection of development activity.
FDA and comparable foreign agencies impose substantial and varying requirements on the introduction of therapeutic pharmaceutical products, typically requiring lengthy and detailed laboratory and clinical testing procedures, sampling activities and other costly and time-consuming procedures ; ​ ● Data obtained from nonclinical and clinical activities at any step in the testing process may be adverse and lead to discontinuation or redirection of development activity.
We did not otherwise adopt any new accounting pronouncements during the fiscal year ended December 31, 2024 that had a material effect on our consolidated financial statements included in this report. ​
We did not otherwise adopt any new accounting pronouncements during the fiscal year ended December 31, 2025 that had a material effect on our consolidated financial statements included in this report. ​
Prior to the year ended December 31, 2019, we incurred net losses in each year since inception. As of December 31, 2024, we had an accumulated deficit of approximately $1.7 billion.
Prior to the year ended December 31, 2019, we incurred net losses in each year since inception. As of December 31, 2025, we had an accumulated deficit of approximately $1.7 billion.
We cannot currently estimate with any degree of certainty the amount of time or money that we will be required to expend in the future on linaclotide for additional indications, populations or formulations. ​ Given the inherent uncertainties that come with the development of pharmaceutical products, we cannot estimate with any degree of certainty how our programs will evolve, and therefore the amount of time or money that would be required to obtain regulatory approval to market them. ​ As a result of these uncertainties surrounding the timing and outcome of any approvals, we are currently unable to estimate precisely when, if ever, linaclotide’s utility will be expanded within its currently approved indications; if or when linaclotide will be developed outside of its current markets, indications, populations or formulations; or when, if ever, apraglutide or any of our other product candidates will generate revenues and cash flows. ​ We invest carefully in our pipeline, and the commitment of funding for each subsequent stage of our development programs is dependent upon the receipt of clear, supportive data.
Given the inherent uncertainties 66 Table of Contents that come with the development of pharmaceutical products, we cannot estimate with any degree of certainty how our programs will evolve, and therefore the amount of time or money that would be required to obtain regulatory approval to market them. ​ As a result of these uncertainties surrounding the timing and outcome of any approvals, we are currently unable to estimate precisely when, if ever, linaclotide’s utility will be expanded within its currently approved indications; if or when linaclotide will be developed outside of its current markets, indications, populations or formulations; or when, if ever, apraglutide or any of our other product candidates will generate revenues and cash flows. ​ We invest carefully in our pipeline, and the commitment of funding for each subsequent stage of our development programs is dependent upon the receipt of clear, supportive data.
As of December 31, 2024, our debt is comprised of $200.0 million aggregate principal amount of convertible notes, due in 2026, and $ 385.0 million aggregate principal amount outstanding under our Revolving Credit Facility, which we entered into in May 2023 to partially finance the VectivBio Acquisition.
As of December 31, 2025, our debt is comprised of $200.0 million aggregate principal amount of convertible notes, due in June 2026, and $385.0 million aggregate principal amount outstanding under our Revolving Credit Facility, which we entered into in May 2023 to partially finance the VectivBio Acquisition.
We are highly dependent on AbbVie for timely and accurate information regarding any net revenues realized from sales of LINZESS in the U.S. in accordance with ASC 808, and the related costs, in order to accurately report its results of operations.
We are highly dependent on AbbVie for timely and accurate information regarding any net revenues 69 Table of Contents realized from sales of LINZESS in the U.S. in accordance with ASC 808, and the related costs, in order to accurately report its results of operations.
Linaclotide is also available to adult men and women suffering from IBS-C or CIC in certain countries of the world, including China, Japan, and in a number of European countries. ​ We and AbbVie continue to explore ways to enhance the clinical profile of LINZESS by studying linaclotide in additional indications, populations and formulations to assess its potential to treat various conditions.
Linaclotide is also available to adults suffering from IBS-C or CIC in certain countries of the world, including China, Japan, and in a number of European countries. ​ We and AbbVie continue to explore ways to enhance the clinical profile of LINZESS by studying linaclotide in additional indications, populations and formulations to assess its potential to treat various conditions.
While ASC 808 provides guidance on classification, the standard is silent on matters of separation, initial measurement, and recognition. Therefore, we apply 72 Table of Contents the separation, initial measurement, and recognition principles of ASC Topic 606, Revenue from Contracts with Customers , to our collaboration agreements.
While ASC 808 provides guidance on classification, the standard is silent on matters of separation, initial measurement, and recognition. Therefore, we apply the separation, initial measurement, and recognition principles of ASC Topic 606, Revenue from Contracts with Customers , to our collaboration agreements.
The fair value of stock awards, RSAs, and RSUs is based on the market value of our Class A Common Stock on the date of grant, with the exception of PSUs with market conditions, which are measured using the Monte Carlo simulation method.
The fair value of 70 Table of Contents stock awards, RSAs, and RSUs is based on the market value of our Class A Common Stock on the date of grant, with the exception of PSUs with market conditions, which are measured using the Monte Carlo simulation method.
Reimbursements received for research and development activities under this agreement are netted against research and development expenses. ​ Linaclotide . Our commercial product, LINZESS, is commercially available in the U.S. for the treatment of IBS-C or CIC in adults and for FC in pediatric patients ages 6-17 years-old.
Reimbursements received for research and development activities under this agreement are netted against research and development expenses. ​ Linaclotide . Our commercial product, LINZESS, is commercially available in the U.S. for the treatment of IBS-C in adults and pediatric patients 7 years of age and older, CIC in adults and FC in pediatric patients ages 6-17 years-old.
In addition, our collaborative arrangements revenue may fluctuate as a result of the timing and amount of license fees and clinical and commercial milestones received and recognized under our current and future strategic partnerships as well as timing and amount of royalties from the sales of linaclotide in the European, Canadian, Mexican, Japanese, or Chinese markets or any other markets where linaclotide receives approval and is commercialized. ​ Cost of Revenues .
In addition, our collaborative arrangements revenue may fluctuate as a result of the timing and amount of license fees and clinical and commercial milestones received and recognized under our current and future strategic partnerships as well as timing and amount of royalties from the sales of linaclotide in the European, Canadian, Mexican, Japanese, or Chinese markets or any other markets where linaclotide receives approval and is commercialized. ​ Research and Development Expenses.
Our revenues are generated primarily through our collaborative arrangements and license agreements related to research and development and commercialization of linaclotide. ​ The majority of our revenues are generated from the sales of LINZESS in the U.S.
Financial Operations Overview Revenues. Our revenues are generated primarily through our collaborative arrangements and license agreements related to research and development and commercialization of linaclotide. ​ The majority of our revenues are generated from the sales of LINZESS in the U.S.
SBS-IF, a rare and severe organ failure condition in which patients are dependent on PS, affects an estimated 18,000 adult patients in the U.S., Europe, and Japan. We are also conducting an open-label extension study, STARS Extend, to further assess safety of apraglutide in adult patients with SBS-IF. In January 2025, we initiated a rolling NDA submission to the U.S.
SBS-IF, a rare and severe organ failure condition in which patients are dependent on PS, affects an estimated 18,000 adult patients in the U.S., Europe, and Japan. We are also conducting an open-label extension study, STARS Extend, to further assess the safety of apraglutide in adult patients with SBS-IF.
The nature of the uncertain tax 74 Table of Contents positions is often complex and subject to change, and the amounts at issue can be substantial.
The nature of the uncertain tax positions is often complex and subject to change, and the amounts at issue can be substantial.
Our early research and development efforts have been focused on supporting our development stage GI programs, including exploring strategic options for further development of certain of our internal programs, as well as evaluating external development-stage GI programs. 68 Table of Contents ​ The following table sets forth our research and development expenses related to our product pipeline for the years ended December 31, 2024, 2023, and 2022, respectively.
Our early research and development efforts have been focused on supporting our development stage GI and rare diseases programs, including exploring strategic options for further development of certain of our internal programs, as well as evaluating external development-stage programs. ​ The following table sets forth our research and development expenses related to our product pipeline for the years ended December 31, 2025 and 2024, respectively.
Data obtained from these activities also are susceptible to varying interpretations, which could delay, limit or prevent regulatory approval; ​ ● The duration and cost of early research and development, including nonclinical studies and clinical trials, may vary significantly over the life of a product candidate and are difficult to predict; ​ ● The costs, timing and outcome of regulatory review of a product candidate may not be favorable, and, even if approved, a product may face post-approval development and regulatory requirements; ​ ● There may be substantial costs, delays and difficulties in successfully integrating externally developed product candidates into our business operations; and ​ ● The emergence of competing technologies and products and other adverse market developments may negatively impact us. ​ As a result of the factors discussed above, including the factors discussed under “Risk Factors” in Item 1A of this Annual Report on Form 10-K, we are unable to determine the duration and costs to complete current or future nonclinical and clinical stages of our product candidates or when, or to what extent, we will generate revenues from the commercialization and sale of our product candidates.
FDA and comparable foreign agencies may require additional clinical trials and other studies, which may be costly or delay, limit, prevent or otherwise impact regulatory submission or approval; ​ ● The duration and cost of early research and development, including nonclinical studies and clinical trials, may vary significantly over the life of a product candidate and are difficult to predict; ​ ● The costs, timing and outcome of regulatory review of a product candidate may not be favorable, and, even if approved, a product may face post-approval development and regulatory requirements; ​ ● There may be substantial costs, delays and difficulties in successfully integrating externally developed product candidates into our business operations; and ​ ● The emergence of competing technologies and products and other adverse market developments may negatively impact us. ​ As a result of the factors discussed above, including the factors discussed under “Risk Factors” in Item 1A of this Annual Report on Form 10-K, we are unable to determine the duration and costs to complete current or future nonclinical and clinical stages of our product candidates or when, or to what extent, we will generate revenues from the commercialization and sale of our product candidates.
The core of our research and development strategy is to leverage our demonstrated expertise and capabilities in GI diseases to bring multiple medicines to patients. Research and development expense consists of expenses incurred in connection with the research into and development of products and product candidates.
The core of our research and development strategy is to leverage our demonstrated expertise and capabilities in GI and rare diseases to bring medicines to patients. Research and development expenses consist of expenses incurred in connection with the research into and development of products and product candidates.
Linaclotide is available under the trademarked name CONSTELLA ® to adult men and women suffering from IBS-C or CIC and pediatric patients ages 6-17 years old with FC in Canada, and to adult men and women suffering from IBS-C in certain European countries. ​ We have strategic partnerships with leading pharmaceutical companies to support the development and commercialization of linaclotide throughout the world, including with AbbVie in the U.S. and all countries worldwide other than China (including Hong Kong and Macau) and Japan, AstraZeneca in China (including Hong Kong and Macau), and Astellas in Japan. ​ We also aim to leverage our development and commercialization capabilities in GI to bring additional treatment options to GI patients. ​ Through the VectivBio Acquisition, we are advancing apraglutide, a next-generation, synthetic long-acting peptide analog of GLP-2 for SBS patients who are dependent on PS.
Linaclotide is available under the trademarked name CONSTELLA® for the treatment of adults with IBS-C or CIC and pediatric patients ages 6-17 years old with FC in Canada, and to adults with IBS-C in certain European countries. ​ We have strategic partnerships with leading pharmaceutical companies to support the development and commercialization of linaclotide throughout the world, including with AbbVie in the U.S. and all countries worldwide other than China (including Hong Kong and Macau) and Japan, AstraZeneca in China (including Hong Kong and Macau), and Astellas in Japan. ​ Through the VectivBio Acquisition, we are advancing apraglutide, a next-generation, synthetic long-acting peptide analog of GLP-2 for SBS patients who are dependent on PS.
The boxed warning and contraindication previously applied to all children less than 18 years of age and less than 6 years of age, respectively. In June 2023, the U.S. FDA approved LINZESS as a once-daily treatment for pediatric patients ages 6-17 years-old with FC, making LINZESS the first and only FDA-approved prescription therapy for FC in this patient population.
The boxed warning and contraindication previously applied to all children less than 18 years of age and less than 6 years of age, respectively. In June 2023, the U.S. FDA approved LINZESS as a once-daily 65 Table of Contents treatment for pediatric patients ages 6-17 years-old with FC, making LINZESS the first and only U.S.
Our most significant fixed obligations are debt obligations and lease commitments, for which annual payments are disclosed in Note 10, Debt , and Note 7, Leases , respectively, to our financial statements included elsewhere in this Annual Report on Form 10-K.
Our most significant fixed obligations are debt obligations, supply purchase commitments, and lease commitments, for which annual payments are disclosed in Note 9, Debt , Note 10, Commitments and Contingencies , and Note 6, Leases , respectively, to our financial statements included elsewhere in this Annual Report on Form 10-K.
We operate in one reportable business segment – human therapeutics. ​ Key 2024 Financial Highlights ​ ● We recognized $351.4 million in total revenues during the year ended December 31 2024, compared to $442.7 million during the year ended December 31, 2023.
We operate in one reportable business segment – human therapeutics. ​ Key 2025 Financial Highlights ​ ● We recognized $296.2 million in total revenues during the year ended December 31, 2025, compared to $351.4 million during the year ended December 31, 2024.
In addition, pension expense is sensitive to the discount rate used to value the pension obligation. As a sensitivity measure, an increase or decrease in our discount rate assumption of 1.00% would decrease and increase our pension expense by $1.8 million and $2.3 million, respectively.
In addition, pension expense is sensitive to the discount rate used to value the pension obligation. As a sensitivity measure, an increase or decrease in our discount rate assumption of 1.00% would decrease and increase our pension benefit obligation by $2.0 71 Table of Contents million and $2.6 million, respectively.
Refer to Note 10, Debt , to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K, for information related to our debt obligations. ​ Summary of Cash Flows ​ The following table summarizes cash flows from operating, investing, and financing activities for the years ended December 31, 2024, 2023, and 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ 2024 ​ 2023 ​ ​ ​ (in thousands) Net cash provided by (used in): ​ ​ ​ ​ ​ ​ ​ Operating activities ​ $ 103,549 ​ $ 183,427 ​ Investing activities ​ ​ (142) ​ ​ (1,026,318) ​ Financing activities ​ ​ (106,970) ​ ​ 277,160 ​ Effect of exchange rate changes on cash, cash equivalents and restricted cash ​ ​ (32) ​ ​ (53) ​ Net increase (decrease) in cash, cash equivalents and restricted cash ​ $ (3,595) ​ $ (565,784) ​ ​ Cash Flows from Operating Activities Net cash provided by operating activities is derived by adjusting net income (loss) for non-cash items and changes in operating assets and liabilities, which reflect timing differences between the receipt and payment of cash associated with transactions and when they are recognized in the results of operations.
Refer to Note 9, Debt , to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K, for information related to our debt obligations. ​ Summary of Cash Flows ​ The following table summarizes cash flows from operating, investing, and financing activities for the years ended December 31, 2025 and 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2025 ​ 2024 ​ ​ (in thousands) Net cash provided by (used in): ​ ​ ​ ​ ​ ​ Operating activities ​ $ 127,044 ​ $ 103,549 Investing activities ​ ​ (34) ​ ​ (142) Financing activities ​ ​ 216 ​ ​ (106,970) Effect of exchange rate changes on cash and cash equivalents ​ ​ (329) ​ ​ (32) Net increase (decrease) in cash and cash equivalents ​ $ 126,897 ​ $ (3,595) ​ Cash Flows from Operating Activities Net cash provided by operating activities is derived by adjusting net income (loss) for non-cash items and changes in operating assets and liabilities, which reflect timing differences between the receipt and payment of cash associated with transactions and when they are recognized in the results of operations.
During the year ended December 31, 2024, we recorded income tax expense of $64.3 million, comprised of non-cash tax expense of $57.8 million and cash tax expense of $6.5 million for state income taxes in certain states in which state taxable income exceeded available net operating losses.
During the year ended December 31, 2024, we recorded income tax expense of $64.3 million, comprised of non-cash tax expense of $57.8 million and cash tax expense of $6.5 million for state income taxes in certain states in which state taxable income exceeded available net operating losses. 73 Table of Contents ​ Liquidity and Capital Resources As of December 31, 2025, we had $215.5 million of cash and cash equivalents.
We classify asset acquisitions of acquired IPR&D as investing activities on its consolidated statements of cash flows. 71 Table of Contents Revenue Recognition Upon executing a revenue generating arrangement, we assess whether it is probable we will collect consideration in exchange for the good or service it transfers to the customer and perform the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) we satisfy the performance obligations.
Revenue Recognition Upon executing a revenue generating arrangement, we assess whether it is probable we will collect consideration in exchange for the good or service it transfers to the customer and perform the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) we satisfy the performance obligations.
Net cash inflows during the year ended December 31, 2024 totaled $103.5 million and were derived primarily from collaboration arrangements revenue related to sales of LINZESS in the U.S., partially offset by research and development expenditures for apraglutide.
Net cash inflows during the year ended December 31, 2025 and 2024 totaled $127.0 million and $103.5 million, respectively, and were derived primarily from collaboration arrangements revenue related to sales of LINZESS in the U.S., partially offset by research and development expenditures for apraglutide. 74 Table of Contents Cash Flows from Investing Activities Cash used in investing activities for the year ended December 31, 2025 and 2024 were insignificant and pertained to the purchase of property and equipment.
The workforce reduction and restructuring initiatives are more fully described in Note 16, Workforce Reductions and Restructuring , to our consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K. ​ Interest Expense and Other Financing Costs. Interest expense consists primarily of cash and non-cash interest costs related to our convertible senior notes and Revolving Credit Facility.
The workforce reduction and restructuring initiatives are more fully described in Note 15, Workforce Reductions and Restructuring , to our consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K. ​ Interest Expense and Other Financing Costs.
A detailed discussion of our defined benefit pension plan is contained in Note 15 to our financial statements set forth in Item 8 of this Annual Report on Form 10-K.
A detailed discussion of our defined benefit pension plan is contained in Note 14, Retirement Plans, to our consolidated financial statements, which appears in this Annual Report on Form 10-K.
We believe revenues from our LINZESS partnership for the U.S. with AbbVie will continue to constitute a significant portion of our total revenue for the foreseeable future and we cannot be certain that such revenues, as well as the revenues from our other commercial activities, will continue to enable us to generate positive cash flows, or to do so in the timeframes we expect.
We believe revenues from our LINZESS partnership for the U.S. with AbbVie will continue to constitute a significant portion of our total revenue for the foreseeable future and we cannot be certain that such revenues, as well as the revenues from our other commercial activities, will continue to enable us to generate positive cash flows, or to do so in the timeframes we expect. ​ We also anticipate that we will continue to incur substantial expenses for the next several years as we further develop and commercialize linaclotide in the U.S., develop and commercialize other product candidates, including apraglutide, and invest in building our pipeline through internal or external opportunities.
We allocate costs related to facilities, depreciation, share-based compensation, research and development support services and certain other costs directly to programs. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2024 ​ 2023 ​ 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Linaclotide (1) $ 17,858 ​ $ 21,103 ​ $ 17,267 Apraglutide (2) ​ ​ 73,008 ​ ​ 58,244 ​ ​ — IW-3718 ​ ​ — ​ ​ — ​ ​ 461 IW-3300 ​ ​ 13,179 ​ ​ 15,091 ​ ​ 15,824 CNP-104 (3) ​ ​ 4,253 ​ ​ 9,461 ​ ​ 1,022 Early research and development (4) ​ 3,123 ​ ​ 12,186 ​ ​ 9,691 Total research and development expenses ​ $ 111,421 ​ $ 116,085 ​ $ 44,265 (1) Includes linaclotide in all indications, populations and formulations.
We allocate costs related to facilities, depreciation, share-based compensation, research and development support services and certain other costs directly to programs. ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ ​ 2025 ​ 2024 ​ ​ ​ ​ ​ ​ ​ Linaclotide (1) ​ ​ ​ $ 15,103 ​ $ 17,858 Apraglutide ​ ​ 71,172 ​ ​ 73,008 IW-3300 ​ ​ 4,574 ​ ​ 13,179 CNP-104 ​ ​ 75 ​ ​ 4,253 Early research and development (2) ​ 4,212 ​ ​ 3,123 Total research and development expenses ​ $ 95,136 ​ $ 111,421 (1) Includes linaclotide in all indications, populations and formulations.
During the year ended December 31, 2023, we recorded income tax expense of $83.5 million, comprised of non-cash tax expense of $74.1 million and cash tax expense of $9.4 million for state income taxes in certain states in which state taxable income exceeded available net operating losses. ​ Liquidity and Capital Resources As of December 31, 2024, we had $88.6 million of cash and cash equivalents.
During the year ended December 31, 2025, we recorded income tax expense of $46.0 million, comprised of non-cash tax expense of $40.9 million and cash tax expense of $5.1 million for state income taxes in certain states in which state taxable income exceeded available net operating losses.
We believe that our cash on hand as of December 31, 2024 will be sufficient to meet our projected operating needs at least through the next twelve months from the issuance of these financial statements. ​ Our forecast of the period of time through which our financial resources will be adequate to support our operations, including the underlying revenue expectations and estimates regarding the costs to continue to develop, obtain regulatory approval for, and commercialize linaclotide in the U.S., develop and commercialize other product candidates, including apraglutide, and our goal to generate and maintain positive cash flows, are forward-looking statements that involve risks and uncertainties.
There is no assurance we will have sufficient liquidity to meet our debt obligations when they become due. ​ Our forecast of the period of time through which our financial resources will be adequate to support our operations, including the underlying revenue expectations and estimates regarding the costs to continue to develop, obtain regulatory approval for, and commercialize linaclotide in the U.S., develop and commercialize other product candidates, including apraglutide, and our goal to generate and maintain positive cash flows, are forward-looking statements that involve risks and uncertainties.
In February 2024, we announced positive topline results from our pivotal Phase III clinical trial, STARS, which evaluated the efficacy and safety of once-weekly subcutaneous apraglutide in reducing parenteral support dependency in adult patients with SBS-IF. In January 2025, we initiated a rolling NDA submission to the U.S.
In February 2024, we announced positive topline results from our pivotal Phase III clinical trial, STARS, which evaluated the efficacy and safety of once-weekly subcutaneous apraglutide in reducing parenteral support dependency in adult patients with SBS-IF. We are also conducting an open-label extension study, STARS Extend, to further assess the safety of apraglutide in adult patients with SBS-IF.
We anticipate our cash balance and our expected net cash inflows from operations to allow us to meet our near-term and long-term cash obligations, which are reflected in our consolidated balance sheets.
We anticipate our cash and cash equivalents balance, our expected net cash inflows from operations, our borrowing capacity on our Revolving Credit Facility, and/or additional capital sources to allow us to meet our short-term and long-term cash obligations, which are reflected in our consolidated balance sheets.
Such repurchases, redemptions or exchanges, if any, of our debt will depend on prevailing market conditions, liquidity requirements, contractual restrictions and other factors, and the amounts involved may be material. In May 2021, our board of directors authorized a program to repurchase up to $150.0 million of our Class A Common Stock.
Such repurchases, redemptions or exchanges, if any, of our debt will depend on prevailing market conditions, liquidity requirements, contractual restrictions and other factors, and the amounts involved may be material.
Additionally, we paid $26.3 million to acquire subsidiary shares from noncontrolling interests to complete the squeeze-out merger in connection with the VectivBio Acquisition. Funding Requirements ​ We began commercializing LINZESS in the U.S. with our collaboration partner, AbbVie, in the fourth quarter of 2012, and we currently derive a significant portion of our revenue from this collaboration.
Funding Requirements ​ We began commercializing LINZESS in the U.S. with our collaboration partner, AbbVie, in the fourth quarter of 2012, and we currently derive a significant portion of our revenue from this collaboration.
Recognition of expense for such payments requires judgment with respect to when the obligation is probable. 73 Table of Contents Share-Based Compensation Expense We grant awards under our share-based compensation programs, including stock awards, restricted stock awards, or RSAs, restricted stock units, or RSUs (including performance-based RSUs, or PSUs), stock options, and shares issued under our employee stock purchase plan, or ESPP.
Share-Based Compensation Expense We grant awards under our share-based compensation programs, including stock awards, restricted stock awards, or RSAs, restricted stock units, or RSUs (including performance-based RSUs, or PSUs), stock options, and shares issued under our employee stock purchase plan, or ESPP.
FDA, in a class of GI medicines called GC-C agonists and is indicated for adult men and women suffering from IBS-C or CIC, and for pediatric patients ages 6-17 years-old suffering from FC.
FDA, in a class of GI medicines called GC-C agonists and is indicated for the treatment of irritable bowel syndrome with constipation, or IBS-C, in adults and pediatric patients 7 years of age and older, chronic idiopathic constipation, or CIC, in adults, and functional constipation, or FC, in pediatric patients ages 6-17 years-old.
We must develop assumptions that require significant judgment to determine the standalone selling price for each performance obligation identified in the contract. The assumptions that are used to determine the standalone selling price may include forecasted revenues, development timelines, reimbursement rates for personnel costs, discount rates and probabilities of technical and regulatory success.
We must develop assumptions that require significant judgment to determine the standalone selling price for each performance obligation identified in the contract.
Research and development expenses also include up-front payment, non-contingent payment, and milestone payment obligations under certain collaboration arrangements.
Research and development expenses also include up-front payment, non-contingent payment, and milestone payment obligations under certain collaboration arrangements. Recognition of expense for such payments requires judgment with respect to when the obligation is probable.
Results of Operations The following discussion summarizes the key factors our management believes are necessary for an understanding of our consolidated financial statements. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ ​ ​ ​ ​ ​ 2024 ​ 2023 ​ ​ (in thousands) Revenues: ​ ​ ​ ​ ​ ​ Collaborative arrangements revenue $ 351,410 $ 442,735 Total revenues ​ ​ 351,410 ​ ​ 442,735 Costs and expenses: ​ ​ ​ ​ ​ ​ Research and development ​ 111,421 ​ 116,085 Selling, general and administrative ​ 144,272 ​ 158,314 Restructuring ​ ​ 2,593 ​ ​ 18,317 Acquired in-process research and development ​ ​ — ​ ​ 1,095,449 Total costs and expenses ​ 258,286 ​ 1,388,165 Income (loss) from operations ​ 93,124 ​ (945,430) Other income (expense): ​ ​ ​ ​ ​ ​ Interest expense and other financing costs ​ (33,034) ​ (21,629) Interest and investment income ​ 4,468 ​ 18,971 Gain on derivatives ​ — ​ 19 Other ​ 640 ​ — Other income (expense), net ​ (27,926) ​ (2,639) Income (loss) before income taxes ​ ​ 65,198 ​ ​ (948,069) Income tax expense ​ ​ (64,318) ​ ​ (83,490) Net income (loss) ​ ​ 880 ​ ​ (1,031,559) Less: Net loss attributable to noncontrolling interests ​ ​ — ​ ​ (29,320) Net income (loss) attributable to Ironwood Pharmaceuticals, Inc. ​ $ 880 ​ $ (1,002,239) ​ 75 Table of Contents Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 Revenues ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ ​ ​ ​ December 31, ​ Change ​ ​ 2024 ​ 2023 ​ $ ​ ​ (in thousands) Revenues: ​ ​ ​ ​ ​ ​ ​ ​ ​ Collaborative arrangements revenue $ 351,410 $ 442,735 $ (91,325) Total revenues ​ $ 351,410 ​ $ 442,735 ​ $ (91,325) ​ Collaborative arrangements revenue.
Results of Operations The following discussion summarizes the key factors our management believes are necessary for an understanding of our consolidated financial statements. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ ​ 2025 ​ 2024 ​ ​ (in thousands) Revenues: ​ ​ ​ ​ ​ ​ Collaborative arrangements revenue ​ $ 296,151 ​ ​ ​ $ 351,410 Total revenues ​ ​ 296,151 ​ ​ 351,410 Costs and expenses: ​ ​ ​ ​ ​ ​ Research and development ​ 95,136 ​ 111,421 Selling, general and administrative ​ 82,256 ​ 144,272 Restructuring, net ​ ​ 20,257 ​ ​ 2,593 Total costs and expenses ​ 197,649 ​ 258,286 Income from operations ​ 98,502 ​ 93,124 Other income (expense): ​ ​ ​ ​ ​ ​ Interest expense and other financing costs ​ (32,746) ​ (33,034) Interest and investment income ​ 4,076 ​ 4,468 Other ​ 193 ​ 640 Other income (expense), net ​ (28,477) ​ (27,926) Income before income taxes ​ ​ 70,025 ​ ​ 65,198 Income tax expense ​ ​ (46,008) ​ ​ (64,318) Net income ​ $ 24,017 ​ $ 880 ​ Year Ended December 31, 2025 Compared to Year Ended December 31, 2024 Revenues ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ ​ ​ ​ December 31, ​ Change ​ ​ 2025 ​ 2024 ​ $ ​ ​ (in thousands) Revenues: ​ ​ ​ ​ ​ ​ ​ ​ ​ Collaborative arrangements revenue ​ ​ ​ $ 296,151 ​ ​ ​ $ 351,410 ​ ​ ​ $ (55,259) Total revenues ​ $ 296,151 ​ $ 351,410 ​ $ (55,259) ​ Collaborative arrangements revenue.
The decrease was primarily related to a $90.1 million decrease in our share of net profits from the sale of LINZESS in the U.S., which was driven by decreased net price (including a $43.0 million reduction to collaboration revenue as a result of changes in estimates of sales reserves and allowances associated with governmental and contractual rebates), partially offset by increases from prescription demand. ​ ● We generated income from operations of $93.1 million during the year ended December 31, 2024 compared to a loss from operations of $ 945.4 million during the year ended December 31, 2023.
In addition, results for the year ended December 31, 2024 included a $43.0 million reduction to collaboration revenue as a result of changes in estimates of sales reserves and allowances associated with 64 Table of Contents governmental and contractual rebates. ​ ● We generated income from operations of $ 98.5 million during the year ended December 31, 2025, compared to income from operations of $ 93.1 million during the year ended December 31, 2024.
Any failure by us to obtain, or any delay in obtaining, regulatory approvals would materially adversely affect our product development efforts and our business overall. ​ We and AbbVie are exploring development opportunities to enhance the clinical profile of LINZESS by studying linaclotide in additional indications, populations and formulations to assess its potential to treat various conditions.
Any failure by us to obtain, or any delay in obtaining, regulatory approvals would materially adversely affect our product development efforts and our business overall.
Additional information regarding the repurchase program is disclosed in Note 12, Stockholders’ Equity , to our financial statements included elsewhere in this Annual Report on Form 10-K. 77 Table of Contents ​ Sources of Liquidity ​ We have financed our operations to date primarily through both the private sale of our preferred stock and the public sale of our common stock, debt financings, and cash generated from our operations .
Sources of Liquidity ​ We have financed our operations to date primarily through both the private sale of our preferred stock and the public sale of our common stock, debt financings, and cash generated from our operations .
We will continue to invest in linaclotide, including the investigation of ways to enhance the clinical profile within its currently approved indications, and the exploration of its potential utility in other indications, populations and formulations.
We will continue to invest in linaclotide, including the investigation of ways to enhance the clinical profile within its currently approved indications, and the exploration of its potential utility in other indications, populations and formulations, and in apraglutide, as we advance it through clinical trials, in addition to funding research and development activities under our external collaboration and license agreements with respect to our products and product candidates. ​ 67 Table of Contents Selling, General and Administrative Expense.
In December 2024, we decided to end further development of apraglutide for aGvHD to focus investment on other priorities. ​ CNP-104 . Through the COUR Collaboration Agreement, we and COUR were developing CNP-104 for the treatment of PBC, a rare autoimmune disease targeting the liver.
In April 2025, based on analysis of the Phase II data, we decided to cease developing IW-3300 for IC/BPS. ​ CNP-104 . Through a collaboration and license option agreement, or the COUR Collaboration Agreement, we and COUR Pharmaceutical Development Company, Inc., or COUR, were developing CNP-104 for the treatment of PBC, a rare autoimmune disease targeting the liver.
The decrease in collaborative arrangements revenue of $91.3 million for the year ended December 31, 2024 compared to the year ended December 31, 2023 was primarily related to a $90.1 million decrease in our share of net profits from the sale of LINZESS in the U.S., which was driven by decreased net price (including a $43.0 million reduction to collaboration revenue as a result of changes in estimates of sales reserves and allowances associated with government and contractual rebates), partially offset by increases from prescription demand. ​ Cost and Expenses ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ ​ ​ ​ December 31, ​ Change ​ 2024 2023 $ ​ ​ (in thousands) Costs and expenses: ​ ​ ​ ​ ​ ​ ​ ​ ​ Research and development ​ $ 111,421 ​ $ 116,085 ​ $ (4,664) Selling, general and administrative ​ 144,272 ​ 158,314 ​ (14,042) Restructuring ​ ​ 2,593 ​ ​ 18,317 ​ ​ (15,724) Acquired in-process research and development ​ ​ — ​ ​ 1,095,449 ​ ​ (1,095,449) Total costs and expenses ​ $ 258,286 ​ $ 1,388,165 ​ $ (1,129,879) ​ Research and development.
The decrease in collaborative arrangements revenue of $55.3 million for the year ended December 31, 2025 compared to the year ended December 31, 2024 was primarily related to a $51.1 million decrease in our share of net profits from the sale of LINZESS in the U.S., which was driven by decreased net price and inventory channel fluctuations, partially offset by increased prescription demand. ​ 72 Table of Contents Costs and Expenses ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ ​ ​ ​ December 31, ​ Change ​ ​ ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ $ ​ ​ (in thousands) Costs and expenses: ​ ​ ​ ​ ​ ​ ​ ​ ​ Research and development ​ $ 95,136 ​ $ 111,421 ​ $ (16,285) Selling, general and administrative ​ 82,256 ​ 144,272 ​ (62,016) Restructuring, net ​ ​ 20,257 ​ ​ 2,593 ​ ​ 17,664 Total costs and expenses ​ $ 197,649 ​ $ 258,286 ​ $ (60,637) ​ Research and development.
As a result, the COUR Collaboration Agreement has terminated, and we retain no rights and have no obligations related to CNP-104. ​ We are also advancing IW-3300, a GC-C agonist, for the potential treatment of visceral pain conditions, such as IC/BPS, and endometriosis.
As a result, the COUR Collaboration Agreement has terminated, and we retain no rights and have no obligations related to CNP-104. ​ Early research and development .
LINZESS is available to adult men and women suffering from IBS-C or CIC in the U.S. and Mexico, adult men and women suffering from IBS-C or chronic constipation in Japan, and adult men and women suffering from IBS-C in China, and pediatric patients ages 6-17 with FC in the U.S.
LINZESS is also available for the treatment of adults with IBS-C or CIC in Mexico, adults with IBS-C or chronic constipation in Japan, and adults with IBS-C in China.
Interest expense increased by $11.4 million during the year ended December 31, 2024 compared to the year ended December 31, 2023 primarily due to $13.2 million of interest expense incurred under the Revolving Credit Facility used to partially finance the VectivBio Acquisition in June 2023, partially offset by a decrease of $1.3 million of interest expense incurred on the 2024 Convertible Notes. ​ Interest and investment income.
Interest expense decreased by $0.3 million for the year ended December 31, 2025 compared to the year ended December 31, 2024, primarily due to a decrease of $1.1 million in interest expense associated with the 2024 Convertible Notes, which were fully repaid upon maturity in June 2024, partially offset by a $0.7 million increase in other financing costs. ​ Interest and investment income.
Non-cash interest expense consists of amortization of debt issuance costs. ​ 70 Table of Contents Interest and Investment Income. Interest and investment income consists of interest earned on our cash and cash equivalents, as well as significant financing components of payments due from collaboration partners. ​ Gain on Derivatives.
Interest and investment income consists of interest earned on our cash and cash equivalents, as well as significant financing components of payments due from collaboration partners. ​ Income Taxes. We prepare our income tax provision based on our interpretation of the income tax accounting rules and each jurisdiction’s enacted tax laws and regulations.
Our revenues are generated primarily through collaborative arrangements and license agreements related to the development and commercialization of linaclotide.
The assumptions that are used to determine the standalone selling price may include forecasted revenues, development timelines, reimbursement rates for personnel costs, discount rates and probabilities of technical and regulatory success. 68 Table of Contents Our revenues are generated primarily through collaborative arrangements and license agreements related to the development and commercialization of linaclotide.
Cash provided by financing activities for the year ended December 31, 2023 totaled $277.2 million and was generated primarily from the incurrence of $400.0 million of borrowings under the Revolving Credit Facility, net of 78 Table of Contents $100.0 million of principal repayments.
Cash Flows from Financing Activities Cash provided by financing activities for the year ended December 31, 2025 was $0.2 million and was generated from employee stock purchases.
During the year ended December 31, 2023, we recorded an insignificant gain on derivatives resulting from a decrease in the fair value of the Note Hedge Warrants, which terminated unexercised upon expiry in April 2023. ​ Other. During the year ended December 31, 2024, we recorded a gain of $0.6 million for pension-related activities. ​ Income taxes.
Interest and investment income decreased by $0.4 million for the year ended December 31, 2025 compared to the year ended December 31, 2024, primarily due to a decrease in interest rates. ​ Other. During the years ended December 31, 2025 and 2024, we recorded a gain of $0.2 million and $0.6 million, respectively, for pension-related activities. ​ Income taxes.
(4) Includes $4.8 million reduction to research and development expense recognized in the first quarter of 2024 in connection with the settlement of a license-related contract liability. ​ The lengthy process of securing regulatory approvals for product candidates, including apraglutide, requires the expenditure of substantial resources.
(2) Includes $4.8 million reduction to research and development expense recognized in the first quarter of 2024 in connection with the settlement of a license-related contract liability. ​ We and AbbVie are exploring development opportunities to enhance the clinical profile of LINZESS by studying linaclotide in additional indications, populations and formulations to assess its potential to treat various conditions.
The safety and effectiveness of LINZESS in patients with FC less than 6 years of age or in patients with IBS-C less than 18 years of age have not been established. Additional clinical pediatric programs in IBS-C and FC are ongoing. ​ Apraglutide for SBS-IF .
FDA-approved prescription therapy for FC in this patient population. On October 15, 2025, the U.S. FDA granted us a pediatric exclusivity for studies conducted on linaclotide, and in November 2025, approved LINZESS for pediatric patients 7 years of age and older with IBS-C. Additional clinical pediatric programs in FC are ongoing. ​ Apraglutide for SBS-IF .
Selling, general and administrative expenses decreased $14.0 million for the year ended December 31, 2024 compared to the year ended December 31, 2023, primarily due to $16.2 million of share-based compensation and $3.0 million in related payroll taxes recognized in the second quarter of 2023 immediately after the closing of the VectivBio Acquisition in connection with the vesting acceleration of outstanding stock options and RSUs under VectivBio’s 2021 Equity Incentive Plan, and a $0.9 million decrease in compensation, benefits, and other employee-related expenses, partially offset by a $8.0 million increase in professional services costs (including $4.5 million related to commercial launch planning for apraglutide, if approved). ​ Restructuring expenses .
Selling, general and administrative expenses decreased by $62.0 million for the year ended December 31, 2025 compared to the year ended December 31, 2024, primarily due to a $47.8 million decrease in compensation, benefits, and other employee-related expenses, and a $13.5 million decrease in sales and marketing expenses, both resulting from the restructuring initiatives during 2025, as well as a decrease of $5.9 million in professional services expenses.
Restructuring expenses pertain to a headquarters-based workforce reduction in April 2023 and restructuring initiatives in connection with the VectivBio Acquisition commencing in June 2023.
Restructuring expenses pertain to a workforce reduction initiative in connection with the VectivBio Acquisition, as well as workforce reductions in January 2025 consisting primarily of field-based sales employees and August 2025 consisting of certain positions supporting apraglutide commercialization efforts.
Restructuring expenses were $2.6 million for the year ended December 31, 2024 related to employee severance, benefits and related costs for the VectivBio Acquisition-related workforce reduction.
The increase in restructuring expense of $17.7 million for the year ended December 31, 2025 compared to the year ended December 31, 2024, is primarily related to the workforce reduction in January 2025.
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Discussion and analysis of our financial condition and results of operations for the fiscal year ended December 31, 2023 compared to the fiscal year ended December 31, 2022 is included in Part II, Item 7 – "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the SEC on February 16, 2024.
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In April 2025, we announced that, based on discussions with the U.S. FDA, a confirmatory Phase III clinical trial is needed to seek approval of a new drug application or NDA, for apraglutide for patients with SBS-IF who are dependent on PS. In the fourth quarter of 2025, we met with the U.S.
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FDA and plan to submit marketing applications to other regulatory authorities for apraglutide for use in adult patients with SBS who are dependent on PS. ​ In November 2021, we entered into the COUR Collaboration Agreement with COUR, that granted us an option to acquire an exclusive license to research, develop, manufacture and commercialize, in the U.S., products containing CNP-104, a tolerizing immune modifying nanoparticle, for the treatment of PBC.
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FDA and aligned on key design elements of a confirmatory Phase III clinical trial, STARS-2, of apraglutide. Site initiations are expected to begin in the second quarter of 2026. ​ To date, we have dedicated a majority of our activities to the research, development and commercialization of linaclotide, as well as other research and development programs, including apraglutide.
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In September 2024, we decided to end further recruitment for the Phase II proof of concept study in IC/BPS and analyze the data once all currently enrolled patients complete the full 12-week study assessment, which will inform the next steps in the program. ​ 66 Table of Contents To date, we have dedicated a majority of our activities to the research, development and commercialization of linaclotide, as well as to the research and development of our other product candidates, including apraglutide.
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The decrease was primarily related to a $51.1 million decrease in our share of net profits from the sale of LINZESS in the U.S., which was driven by decreased net price and inventory channel fluctuations, partially offset by increased prescription demand.
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The increase was primarily attributable to incurring approximately $1.1 billion in IPR&D expense related to the VectivBio Acquisition in 2023. ​ ● We generated $103.5 million in cash from operations during the year ended December 31, 2024, ending the year with $88.6 million in cash and cash equivalents. Financial Operations Overview Revenues.
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The increase was primarily driven by a $60.6 million decrease in operating expenses resulting from restructuring activities in 2025 in an effort to streamline focus and support the continued development of our pipeline, which offset the decrease in collaborative arrangements revenue. ​ ● We generated $127.0 million in cash from operations during the year ended December 31, 2025, ending the year with $215.5 million in cash and cash equivalents.
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Cost of revenues primarily includes costs related to the sales of linaclotide API, finished drug product, and finished goods to our partners, which generally occurs upon shipment for sales of API, finished drug product and finished goods after the material has passed all quality testing required for acceptance by the partner to certain of our partners outside of the U.S. ​ Research and Development Expense.
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In April 2025, we announced that, based on discussions with the U.S. FDA, a confirmatory Phase III clinical trial is needed to seek approval of an NDA for apraglutide for patients with SBS-IF who are dependent on PS. In the fourth quarter of 2025, we met with the U.S.
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FDA and plan to submit marketing applications to other regulatory filings for apraglutide for use in adult patients with SBS who are dependent on PS. ​ Apraglutide for aGvHD.
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FDA and aligned on key design elements of a confirmatory Phase III clinical trial, STARS-2, of apraglutide. Site initiations are expected to begin in the second quarter of 2026. ​ IW-3300 . We were developing IW-3300, a GC-C agonist, for the potential treatment of visceral pain conditions, such as IC/BPS.
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In March 2024, we announced positive, primary results up to Day 91 for our Phase II exploratory trial, STARGAZE, to evaluate apraglutide in patients with steroid-refractory GI aGvHD, which evaluated the safety and tolerability of once-weekly apraglutide in aGvHD patients treated with standard of care, including systemic corticosteroids and ruxolitinib.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Item 7A. Quantitative and Qualitative Disclosures about Market Risk Interest Rate Risk We are exposed to market risk related to changes in interest rates. We invest our cash in a variety of financial instruments, principally securities issued by the U.S. government and its agencies, including collateralized reverse repurchase agreements, and money market instruments, as well as commercial paper.
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Item 7A. Quantitative and Qualitative Disclosures about Market Risk We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934, as amended, and are not required to provide the information otherwise required under this item. 76 Table of Contents
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The goals of our investment policy are preservation of capital, fulfillment of liquidity needs and fiduciary control of cash and investments. We also seek to maximize income from our investments without assuming significant risk.
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Our primary exposure to market risk is interest income sensitivity, which is affected by changes in the general level of interest rates, particularly because our investments are in short-term marketable securities.
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Due to the primarily short-term duration of our investment portfolio and the low risk profile of our investments, an immediate 1% change in interest rates would not have a material effect on the fair market value of our portfolio.
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Accordingly, we would not expect our operating results or cash flows to be affected to any significant degree by the effect of a sudden change in market interest rates on our investment portfolio. We do not believe our cash and cash equivalents have significant risk of default or illiquidity.
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While we believe our cash and cash equivalents do not contain excessive risk, we cannot provide absolute assurance that in the future our investments will not be subject to adverse changes in market value. In addition, we maintain significant amounts of cash and cash equivalents at one or more financial institutions that are in excess of federally insured limits.
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Given the 80 Table of Contents potential instability of financial institutions, we cannot provide assurance that we will not experience losses on these deposits.
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Our convertible senior notes bear interest at a fixed rate and therefore have minimal exposure to changes in interest rates; however, because these interest rates are fixed, we may be paying a higher interest rate, relative to market, in the future if our credit rating improves or other circumstances change.
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We are exposed to market risks related to fluctuations in interest rates relating to our secured $550.0 million Revolving Credit Facility. The increase or decrease in annual interest expense resulting from a 10% increase or decrease in the applicable interest rate is $2.8 million.
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Equity Price Risk Our convertible senior notes include conversion and settlement provisions that are based on the price of our Class A Common Stock at conversion or maturity of the notes. The amount of cash we may be required to pay is determined by the price of our Class A Common Stock.
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The fair value of our convertible senior notes is dependent on the price and volatility of our Class A Common Stock and will generally increase or decrease as the market price of our common stock changes.
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To minimize the impact of potential dilution to our common stock upon conversion of the notes, we entered into the Capped Calls with respect to the 2026 Convertible Notes.
Removed
The convertible senior notes and Capped Calls are more fully described in Note 10, Debt , in the accompanying notes to our consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K. Foreign Currency Risk We are also exposed to risks related to changes in foreign currency exchange rates relating to our foreign operations.
Removed
The functional currency of our international subsidiaries is the local currency. We are exposed to foreign currency risk to the extent that we enter into transactions denominated in currencies other than our subsidiaries’ respective functional currencies.
Removed
We are also exposed to unfavorable fluctuations of the U.S. dollar, which is our reporting currency, against the currencies of our operating subsidiaries when their respective financial statements are translated into U.S. dollars for inclusion in our consolidated financial statements. We do not currently hedge our foreign currency exchange rate risk.
Removed
Foreign currency has not had, nor do we believe that a decrease or increase in any foreign currency exchange rates would have, a material impact on our results of operations.

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