4 unchanged sentences
Evaluation of Disclosure Controls and Procedures
−Removed: As required by Rule 13a-15(b) of the Securities Exchange Act of 1934, or Exchange Act, our management, including our principal executive officer and our principal financial officer, conducted an evaluation as of the end of the
−Removed: period covered by this Annual Report on Form 10-K of the effectiveness of the design and operation of our disclosure controls and procedures.
−Removed: Based on that evaluation, our principal executive officer and principal financial officer concluded that, as a result of material weaknesses in internal control over financial reporting as described below, our disclosure controls and procedures were not effective at the reasonable assurance level in ensuring that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.
+Added: As required by Rule 13a-15(b) of the Securities Exchange Act of 1934, or Exchange Act, our management, including our principal executive officer and our principal financial officer, conducted an evaluation as of the end of the period covered by this Annual Report on Form 10-K of the effectiveness of the design and operation of our disclosure controls and procedures.
+Added: Based on that evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective as of December 31, 2025, at the reasonable assurance level in ensuring that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.
Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports we file under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
6 unchanged sentences
Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework provided in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework).
−Removed: Based on this evaluation, our management concluded that our internal control over financial reporting was not effective at the reasonable assurance level as of December 31, 2024 as a result of material weaknesses in internal control over financial reporting as described below.
−Removed: We identified certain control deficiencies in the design and implementation of our internal control over financial reporting that constituted material weaknesses.
−Removed: 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 the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.
−Removed: Specifically, we did not design and or implement an effective control environment or control activities as further detailed below.
−Removed: ● We did not have appropriately designed entity-level controls impacting the (1) control environment, (2) risk assessment procedures, (3) identification of control activities, (4) information and communication and (5) monitoring activities to prevent or detect material misstatements to the financial statements and assess whether the components of internal control were present and functioning.
−Removed: We did not adequately communicate to employees responsible for the execution of controls the relevant information, including objectives and responsibilities, necessary to support the functioning of internal controls over financial reporting.
−Removed: We did not develop and perform sufficient ongoing evaluations to ascertain whether the components of internal control were present and functioning or perform adequate risk assessment procedures within our control environment.
−Removed: These deficiencies were attributed to an insufficient number of qualified resources to effectively perform control design and execution activities and oversee internal control over financial reporting.
−Removed: ● We did not design and maintain effective information technology (IT) general controls around our key accounting and reporting IT systems, specifically related to change management, user access, and data
−Removed: migration, as part of the Company’s enterprise resource planning (ERP) system, and these controls were not operating effectively.
−Removed: Consequently, IT application controls (ITAC) and IT dependent manual (ITDM) business process controls that rely upon information from the ERP system, were also deemed ineffective.
−Removed: ● We did not design and/or operate effective controls over the financial statement close process as well as transaction level controls across various significant accounts and processes to address all material risk of misstatement as of December 31, 2024.
−Removed: Controls were not designed or operating effectively to support (1) the sufficiency of the review including level of precision and retention of evidence, (2) the completeness and accuracy of key data and reports used in the control activities, and/or (3) the timeliness of execution of management controls.
−Removed: ● We did not design and/or operate effective ITDM and ITAC business process controls including appropriate segregation of duties and the completeness and accuracy of data and reports used in control activities and timeliness of execution to address the risk related to the initiation, authorization, and recording of expenditures.
−Removed: Notwithstanding the material weaknesses, no material misstatements were identified in our financial statements as of and for the year ended December 31, 2024 and we have concluded that the financial statements and other financial information included in this Annual Report fairly present in all material respects our financial condition, results of operations and cash flows for the periods presented in conformity with accounting principles generally accepted in the United States.
−Removed: The Company’s independent registered public accounting firm, Ernst & Young LLP, has audited the effectiveness of the Company’s internal control over financial reporting as of December 31, 2024.
−Removed: Their report is set forth herein.
−Removed: Remediation of Material Weaknesses in Internal Control over Financial Reporting
−Removed: Immediately following the identification of the material weaknesses described above, and with the oversight of the Audit Committee, we commenced a process to remediate the underlying control deficiencies contributing to the above material weaknesses.
−Removed: We have started remediating the control deficiencies and will continue these efforts throughout 2025.
−Removed: Our plan for remediation includes the following:
−Removed: ● We have started the process of identifying and recruiting additional personnel who have experience working at public companies and expertise in accounting, financial reporting and internal controls commensurate with the type, volume and complexity of our operations.
−Removed: We have also commenced the search for a Head of IT and plan to centralize the accounting for foreign subsidiaries by transitioning the majority of accounting operations to the U.S.
−Removed: ● We have implemented incremental system approvals and manual monitoring controls to mitigate segregation of duties risk within certain financial processes, and will continue to engage with third party consultants with the requisite knowledge and experience to assess our ERP system and identify opportunities to enhance our use of the system while maintaining appropriate levels of segregation of duties;
−Removed: ● We will enhance our system implementation and development lifecycle documentation to include the following:
−Removed: o Formally define policies and procedures for user roles, including emergency access roles, and requirements for lookback reviews during the implementation and post-implementation user access review phases;
−Removed: o The nature and level of change management documentation required to be maintained during the implementation and post-implementation review phases;
−Removed: o Enhance policies and procedures around data migration, including formally defining the specific material data elements for validation;
−Removed: the procedures to be followed when validating the completeness and accuracy of data migrations;
−Removed: and the level of documentation required to evidence that data migration testing was performed and reviewed;
−Removed: ● We will enhance our training processes, which include conducting and delivering training on a regular basis to our finance and accounting and IT team members on how to execute internal control responsibilities, including the importance of completeness and accuracy procedures and maintaining sufficient documentation and/or evidence to support the performance of control activities;
−Removed: ● To the extent certain control improvements were implemented in 2024 that management believes are operating, but did not have the requisite time period to demonstrate operating effectiveness as of December 31, 2024, we will continue to focus on effectively operating such controls.
−Removed: When fully implemented and operational, we believe the measures described above will remediate the material weaknesses we have identified and strengthen our internal control over financial reporting.
−Removed: As we continue to evaluate and work to improve our internal control over financial reporting, our management may determine to take additional measures.
−Removed: The measures we are implementing are subject to continued management review supported by confirmation and testing, as well as Audit Committee oversight.
−Removed: Management and the Audit Committee remain committed to the implementation of remediation efforts to address the material weaknesses.
−Removed: We will continue to implement measures to remedy our internal control deficiencies, though there can be no assurance that our efforts will be successful or avoid potential future material weaknesses.
−Removed: In addition, until remediation steps have been completed and are operated for a sufficient period of time, and subsequent evaluation of their effectiveness is completed, the material weaknesses previously disclosed, and as described above, will continue to exist.
+Added: Based on this evaluation, our management concluded that our internal control over financial reporting was effective as of December 31, 2025.
+Added: The effectiveness of our internal control over financial reporting as of December 31, 2025 has been audited by KPMG LLP, an independent registered public accounting firm, as stated in their report, which appears in this Annual Report on Form 10-K.
+Added: Remediation of Previously Identified Material Weaknesses
+Added: As previously described in described in “Part II, Item 9A – Controls and Procedures” of our Annual Report on Form 10-K for the year ended December 31, 2024, management identified material weaknesses in our internal control over financial reporting related to the design, implementation and/or operating effectiveness of entity-level controls, information technology, or IT, general controls, controls over the financial statements close process, IT application controls, and IT dependent manual controls.
+Added: During the year ended December 31, 2025, management took several steps to remediate the previously disclosed material weaknesses including the following:
+Added: 1) Engaging third-party specialists to assess and strengthen our design and operating effectiveness of our IT general controls and IT application controls, including change management controls;
+Added: 2) Implementing system approval and monitoring controls to mitigate segregation of duties risks within certain financial processes;
+Added: 3) Hiring and engaging incremental personnel with appropriate expertise in accounting, financial reporting and internal controls commensurate with the type, volume and complexity of our operations;
+Added: 4) Conducting and delivering employee trainings around completeness and accuracy procedures of key data and reports used in control activities.
+Added: As a result of these remediation activities, management has concluded that the controls were designed, implemented and operating effectively, such that the material weaknesses previously identified as of December 31, 2024 have been remediated as of December 31, 2025.
Changes in Internal Control Over Financial Reporting
As required by Rule 13a-15(d) of the Exchange Act, our management, including our principal executive officer and our principal financial officer, conducted an evaluation of the internal control over financial reporting to determine whether any changes occurred during the quarter ended December 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.
−Removed: Based on management’s evaluation, and except as described above, our principal executive officer and principal financial officer concluded that no other changes during the quarter ended December 31, 2024 materially affected, or were reasonably likely to materially affect, our internal control over financial reporting.
−Removed: During the third quarter of 2024, we implemented a new global enterprise resource planning, or ERP system.
−Removed: The implementation of the system will continue through early 2025.
−Removed: The ERP system replaces the existing financial systems we have historically relied on.
−Removed: Throughout the implementation, we reassessed our processes and procedures, which resulted in changes to our internal control over financial reporting.
−Removed: In connection with this implementation, we identified a material weakness in our information technology general controls, as described above.
−Removed: On June 29, 2023, we acquired VectivBio and in our 2023 Annual Report on Form 10-K, we excluded VectivBio from our evaluation of internal control over financial reporting.
−Removed: This exclusion was in accordance with the SEC’s guidance that a recently acquired business may be omitted from the assessment scope for up to one year from the date of acquisition.
−Removed: We have extended our oversight and monitoring processes that support our internal control over financial reporting, as well as our disclosure controls and procedures, to the acquired operations of VectivBio, and we have incorporated VectivBio into our annual assessment of internal control over financial reporting for our fiscal year ended December 31, 2024.
−Removed: Report of Independent Registered Public Accounting Firm
−Removed: To the Stockholders and the Board of Directors of Ironwood Pharmaceuticals, Inc.
−Removed: Opinion on Internal Control Over Financial Reporting
−Removed: We have audited Ironwood Pharmaceuticals, Inc.’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).
−Removed: In our opinion, because of the effect of the material weaknesses described below on the achievement of the objectives of the control criteria, Ironwood Pharmaceuticals, Inc.
−Removed: (the Company) has not maintained effective internal control over financial reporting as of December 31, 2024, based on the COSO criteria.
−Removed: A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis.
−Removed: The following material weaknesses have been identified and included in management’s assessment.
−Removed: Management has identified pervasive material weaknesses throughout the Company’s internal control processes that involve the control environment, risk assessment, control activity, information and communication, and monitoring components of the COSO framework, as well as internal controls across various significant accounts and information technology general controls, that are described in more detail in management’s assessment.
−Removed: We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the 2024 consolidated financial statements of the Company.
−Removed: These material weaknesses were considered in determining the nature, timing and extent of audit tests applied in our audit of the 2024 consolidated financial statements, and this report does not affect our report dated March 31, 2025, which expressed an unqualified opinion thereon.
−Removed: Basis for Opinion
−Removed: The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control Over Financial Reporting.
−Removed: Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.
−Removed: We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.
−Removed: federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
−Removed: We conducted our audit in accordance with the standards of the PCAOB.
−Removed: Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.
−Removed: Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances.
−Removed: We believe that our audit provides a reasonable basis for our opinion.
−Removed: Definition and Limitations of Internal Control Over Financial Reporting
−Removed: A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.
−Removed: A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;
−Removed: (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of
−Removed: management and directors of the company;
−Removed: and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
−Removed: Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.
−Removed: Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
−Removed: /s/ Ernst & Young LLP
−Removed: Boston, Massachusetts
−Removed: March 31, 2025
+Added: Based on management’s evaluation, and except with respect to changes in connection with our implementation of the remediation efforts as described above, our principal executive officer and principal financial officer concluded that no other changes during the quarter ended December 31, 2025 materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Other Information
−Removed: (a) On February 27, 2025, we issued a press release announcing unaudited financial results for the quarter and year ended December 31, 2024, which was furnished on a Current Report on Form 8-K filed on February 27, 2025, and we presented, via webcast, a supplemental earnings presentation setting forth such results, or collectively, the Earnings Materials.
−Removed: Subsequent to the date of presenting our Earnings Materials, we recorded immaterial adjustments to the fourth quarter and full year of 2024 results.
−Removed: We have updated the Earnings Materials on the Investors section of our website at www.ironwoodpharma.com to reflect the adjustments made.
−Removed: (b) During the quarter ended December 31, 2024, no director or officer (as defined in Rule 16a-1(f) under the Exchange Act) of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10 b5- 1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.
+Added: (b) Director and Officer Trading Arrangements
+Added: During the quarter ended December 31, 2025, no director or officer (as defined in Rule 16a-1(f) under the Exchange Act) of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10 b5- 1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.
Disclos ure Regarding Foreign Jurisdictions that Prevent Inspections
8 unchanged sentences
We believe the insider trading prevention policy is reasonably designed to promote compliance with insider trading laws, rules and regulations, and Nasdaq listing standards.
−Removed: A copy of our insider trading prevention policy is filed as Exhibit 19.1 to this Annual Report on Form 10-K.
+Added: A copy of our insider trading prevention policy is filed as Exhibit 19.1 hereto.
It is also our policy that we do not engage in transactions in Company securities while in possession of material nonpublic information concerning the Company or our securities.
16 unchanged sentences
Equity compensation plans not approved by security holders
−Removed: Amount includes the number of shares subject to issuance upon exercise of 4,540,264 outstanding stock options and vesting of 6,554,010 restricted stock units.
−Removed: Amount includes all outstanding stock options but does not include restricted stock units, which do not have an exercise price.
+Added: Amount includes the number of shares subject to issuance upon exercise of 3,399,109 outstanding stock options and vesting of 7,074,324 RSUs.
+Added: Amount includes all outstanding stock options but does not include RSUs, which do not have an exercise price.
Consists of 6,185,663 shares available for future issuance under the Amended and Restated 2019 Equity Incentive Plan and 3,734,460 shares available for future issuance under the Amended and Restated 2010 Employee Stock Purchase Plan.
152 unchanged sentences
March 19, 2021
+Added: Third Amendment to the Amended and Restated Exclusive License Agreement dated as of December 18, 2025, by and among VectivBio AG and Ferring International Center S.A., and, solely for purposes of a limited payment guarantee, Ironwood Pharmaceuticals, Inc.
+Added: Current Report on Form 8-K (File No.
+Added: December 23, 2025
Development and Commercialization Agreement by and between VectivBio AG and Asahi Kasei Pharma Corporation, dated as of March 30, 2022
36 unchanged sentences
Insider Trading Prevention Policy
+Added: Annual Report on Form 10-K (File No.
+Added: March 31, 2025
Subsidiaries of Ironwood Pharmaceuticals, Inc.
−Removed: Consent of Independent Registered Public Accounting Firm
+Added: Consent of KPMG LLP, Independent Registered Public Accounting Firm
+Added: Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm
Certification of Chief Executive Officer pursuant to Rules 13a-14 or 15d-14 of the Exchange Act
18 unchanged sentences
Form 10-K Summary
−Removed: Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Boston, Commonwealth of Massachusetts, on the 31 st day of March 2025.
+Added: Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Boston, Commonwealth of Massachusetts, on the 26 th day of February 2026.
Ironwood Pharmaceuticals, Inc.
5 unchanged sentences
Chief Executive Officer and Director (Principal Executive Officer)
−Removed: March 31, 2025
+Added: February 26, 2026
Thomas McCourt
1 unchanged sentence
Senior Vice President, Chief Financial Officer (Principal Financial Officer)
−Removed: March 31, 2025
+Added: February 26, 2026
Gregory Martini
/s/ Ronald Silver
−Removed: Senior Vice President, Corporate Controller (Principal Accounting Officer)
−Removed: March 31, 2025
+Added: Senior Vice President, Corporate Controller & Chief Accounting Officer (Principal Accounting Officer)
+Added: February 26, 2026
Ronald Silver
Chair of the Board
−Removed: March 31, 2025
+Added: February 26, 2026
/s/ Mark Currie
−Removed: March 31, 2025
+Added: February 26, 2026
+Added: /s/ Alexander Denner
+Added: February 26, 2026
Alexander Denner
−Removed: /s/ Andrew Dreyfus
−Removed: March 31, 2025
−Removed: Andrew Dreyfus
/s/ Jon Duane
−Removed: March 31, 2025
+Added: February 26, 2026
/s/ Marla Kessler
−Removed: March 31, 2025
+Added: February 26, 2026
Marla Kessler
/s/ Catherine Moukheibir
−Removed: March 31, 2025
+Added: February 26, 2026
Catherine Moukheibir
−Removed: March 31, 2025
+Added: February 26, 2026
Index to Consolidated Financial Statements of
Ironwood Pharmaceuticals, Inc.
−Removed: Report of Independent Registered Public Accounting Firm
+Added: Report of Independent Registered Public Accounting Firm (PCAOB ID:
+Added: Report of Independent Registered Public Accounting Firm (PCAOB ID:
Consolidated Balance Sheets as of December 31, 2025 and 2024
−Removed: Consolidated Statements of Income (Loss) for the Years Ended December 31, 2024, 2023, and 2022
−Removed: Consolidated Statements of Comprehensive Income (Loss) for the Years Ended December 31, 2024, 2023, and 2022
−Removed: Consolidated Statements of Stockholders’ Equity (Deficit) for the Years Ended December 31, 2024, 2023, and 2022
+Added: Consolidated Statements of Income for the Years Ended December 31, 2025 and 2024
+Added: Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2025 and 2024
+Added: Consolidated Statements of Stockholders’ Deficit for the Years Ended December 31, 2025 and 2024
Consolidated Statements of Cash Flows for the Years Ended December 31, 2025 and 2024
1 unchanged sentence
Report of Independent Registered Public Accounting Firm
+Added: To the Stockholders and the Board of Directors
+Added: Ironwood Pharmaceuticals, Inc.:
+Added: Opinions on the Consolidated Financial Statements and Internal Control Over Financial Reporting
+Added: We have audited the accompanying consolidated balance sheet of Ironwood Pharmaceuticals, Inc.
+Added: and subsidiaries (the Company) as of December 31, 2025, the related consolidated statements of income, comprehensive income, stockholders’ deficit, and cash flows for the year then ended, and the related notes (collectively, the consolidated financial statements).
+Added: We also have audited the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
+Added: In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2025, and the results of its operations and its cash flows for the year then ended, in conformity with U.S.
+Added: generally accepted accounting principles.
+Added: Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025 based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
+Added: Basis for Opinions
+Added: The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control Over Financial Reporting.
+Added: Our responsibility is to express an opinion on the Company’s consolidated financial statements and an opinion on the Company’s internal control over financial reporting based on our audits.
+Added: We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.
+Added: federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
+Added: We conducted our audits in accordance with the standards of the PCAOB.
+Added: Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.
+Added: Our audit of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.
+Added: Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.
+Added: Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.
+Added: Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.
+Added: Our audits also included performing such other procedures as we considered necessary in the circumstances.
+Added: We believe that our audits provide a reasonable basis for our opinions.
+Added: Definition and Limitations of Internal Control Over Financial Reporting
+Added: A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.
+Added: A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;
+Added: (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of
+Added: management and directors of the company;
+Added: and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
+Added: Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.
+Added: Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
+Added: Critical Audit Matter
+Added: The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that:
+Added: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.
+Added: The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
+Added: Measurement of the pension benefit obligation
+Added: As discussed in Notes 2 and 14 to the consolidated financial statements, the Company maintains a defined benefit plan for employees in Switzerland.
+Added: As of December 31, 2025, the Company’s projected benefit obligation was $15.5 million.
+Added: The measurement of the projected benefit obligation is based on actuarial assumptions that require judgment, which include the discount rate used in determining the projected benefit obligation.
+Added: We identified the evaluation of the projected benefit obligation as a critical audit matter.
+Added: Subjective auditor judgment was required to evaluate the discount rate used in determining the projected benefit obligation because of the need to involve professionals with specialized skills and knowledge.
+Added: The following are the primary procedures we performed to address the critical audit matter.
+Added: We evaluated the design and tested the operating effectiveness of certain controls over the Company’s projected benefit obligation measurement process, including a control related to the determination of the discount rate.
+Added: We involved an actuarial professional with specialized skills and knowledge, who assisted in 1) understanding and assessing the actuarial method and assumptions used to measure the projected benefit obligation, and 2) evaluating changes in the discount rate from prior year against changes in published indices.
+Added: We have served as the Company’s auditor since 2025.
+Added: Boston, Massachusetts
+Added: February 26, 2026
+Added: Report of Independent Registered Public Accounting Firm
To the Stockholders and the Board of Directors of Ironwood Pharmaceuticals, Inc.
Opinion on the Financial Statements
−Removed: We have audited the accompanying consolidated balance sheets of Ironwood Pharmaceuticals, Inc.
−Removed: (the Company) as of December 31, 2024 and 2023, the related consolidated statements of income (loss), comprehensive income (loss), stockholders' equity (deficit) and cash flows for each of the three years in the period ended December 31, 2024, and the related notes (collectively referred to as the “consolidated financial statements”).
−Removed: In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in conformity with U.S.
+Added: We have audited the accompanying consolidated balance sheet of Ironwood Pharmaceuticals, Inc.
+Added: (the Company) as of December 31, 2024, the related consolidated statement of income, comprehensive income, stockholders' deficit, and cash flows for the year ended December 31, 2024, and the related notes (collectively referred to as the “consolidated financial statements”).
+Added: In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2024, and the results of its operations and its cash flows for the year ended December 31, 2024, in conformity with U.S.
generally accepted accounting principles.
−Removed: We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated March 31, 2025 expressed an adverse opinion thereon.
Basis for Opinion
9 unchanged sentences
We believe that our audits provide a reasonable basis for our opinion.
−Removed: Critical Audit Matter
−Removed: The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that:
−Removed: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.
−Removed: The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
−Removed: Valuation of Employee Retirement Plan
−Removed: Description of the Matter
−Removed: The Company maintains a defined benefit plan for employees at its VectivBio entity.
−Removed: At December 31, 2024, the Company’s aggregate defined benefit pension obligation was $18.5 million and exceeded the fair value of pension plan assets of $15.7 million, resulting in an unfunded defined benefit pension obligation of $2.8 million.
−Removed: As explained in Note 15 of the consolidated financial statements, the Company updates the estimates used to measure employee benefit obligations in the fourth quarter and upon a remeasurement event to reflect the updated actuarial assumptions.
−Removed: Auditing the employee benefit obligation was complex due to the judgment in determining the discount rate used to measure the pension obligation.
−Removed: This assumption had a significant effect on the projected benefit obligation.
−Removed: Further, the identified material weakness relating to the financial statement close process, affected the defined benefit pension obligation and our audit procedures in this area.
−Removed: How We Addressed the Matter in Our Audit
−Removed: To test the discount rate used in the pension obligation, our audit procedures included, among others, evaluating the methodology used to determine the discount rate with the assistance of an actuarial specialist.
−Removed: We compared the discount rate used by management to historical trends, current economic factors and evaluated the change in the discount rate from prior year.
−Removed: In addition, we compared the discount rate with our independently calculated discount rate as well as with publicly available comparative rates.
−Removed: The nature and extent of our audit procedures considered the material weakness described above.
/s/ Ernst & Young LLP
−Removed: We have served as the Company’s auditor since 1998.
+Added: We have served as the Company’s auditor from 1998 to 2025.
Boston, Massachusetts
24 unchanged sentences
Other liabilities
−Removed: Commitments and contingencies
+Added: Commitments and contingencies (Note 10)
Stockholders’ deficit:
Preferred stock, $ 0.001 par value, 75,000,000 shares authorized, no shares issued and outstanding
−Removed: Class A Common Stock, $ 0.001 par value, 500,000,000 shares authorized and 160,205,899 shares issued and outstanding at December 31, 2024 and 500,000,000 shares authorized and 156,354,238 shares issued and outstanding at December 31, 2023
+Added: Class A Common Stock, $ 0.001 par value, 500,000,000 shares authorized and 163,058,316 shares issued and outstanding as of December 31, 2025 and 500,000,000 shares authorized and 160,205,899 shares issued and outstanding as of December 31, 2024
Additional paid-in capital
2 unchanged sentences
( 1,697,735 )
−Removed: Accumulated other comprehensive loss
+Added: Accumulated other comprehensive income (loss)
Total stockholders’ deficit
2 unchanged sentences
Ironwood Pharmaceuticals, Inc.
−Removed: Consolidated Statements of Income (Loss)
+Added: Consolidated Statements of Income
(In thousands, except per share amounts)
5 unchanged sentences
Selling, general and administrative
−Removed: Restructuring
−Removed: Acquired in-process research and development
+Added: Restructuring, net
Total costs and expenses
−Removed: Income (loss) from operations
+Added: Income from operations
Other income (expense):
1 unchanged sentence
Interest and investment income
−Removed: Gain on derivatives
Other income (expense), net
−Removed: Income (loss) before income taxes
+Added: Income before income taxes
Income tax expense
−Removed: Net income (loss)
−Removed: ( 1,031,559 )
−Removed: Net loss attributable to noncontrolling interests
−Removed: Net income (loss) attributable to Ironwood Pharmaceuticals, Inc.
−Removed: ( 1,002,239 )
−Removed: Net income (loss) per share attributable to Ironwood Pharmaceuticals, Inc.
−Removed: stockholders — basic
−Removed: Net income (loss) per share attributable to Ironwood Pharmaceuticals, Inc.
−Removed: stockholders — diluted
−Removed: Weighted average shares used in computing net income (loss) per share attributable to Ironwood Pharmaceuticals, Inc.
−Removed: stockholders — basic:
−Removed: Weighted average shares used in computing net income (loss) per share attributable to Ironwood Pharmaceuticals, Inc.
−Removed: stockholders — diluted:
+Added: Net income per share — basic and diluted
+Added: Weighted average shares used in computing net income per share — basic:
+Added: Weighted average shares used in computing net income per share — diluted:
The accompanying notes are an integral part of these consolidated financial statements.
Ironwood Pharmaceuticals, Inc.
−Removed: Consolidated Statements of Comprehensive Income (Loss)
+Added: Consolidated Statements of Comprehensive Income
(In thousands, except per share amounts)
Years Ended December 31,
−Removed: Net income (loss) attributable to Ironwood Pharmaceuticals, Inc.
−Removed: ( 1,002,239 )
Other comprehensive income (loss), net of tax:
2 unchanged sentences
Total other comprehensive income (loss), net of tax
−Removed: Other comprehensive loss attributable to noncontrolling interest
−Removed: Comprehensive income (loss) attributable to Ironwood Pharmaceuticals, Inc.
−Removed: ( 1,005,207 )
+Added: Comprehensive income
The accompanying notes are an integral part of these consolidated financial statements.
Ironwood Pharmaceuticals, Inc.
−Removed: Consolidated Statements of Stockholders’ Equit y (Deficit)
+Added: Consolidated Statements of Stockholders’ Deficit
(In thousands, except share amounts)
−Removed: Pharmaceuticals, Inc.
comprehensive
stockholders’
−Removed: Noncontrolling
−Removed: stockholders’
−Removed: equity (deficit)
−Removed: equity (deficit)
−Removed: Balance at December 31, 2021
−Removed: Cumulative effect adjustment upon adoption of ASU 2020-06, net of tax
−Removed: Issuance of common stock related to share-based awards and employee stock purchase plan
−Removed: Share-based compensation expense related to share-based awards and employee stock purchase plan
−Removed: Repurchases of common stock
+Added: income (loss)
+Added: Balance as of December 31, 2023
( 1,698,615 )
−Removed: Balance at December 31, 2022
Issuance of common stock related to share-based awards and employee stock purchase plan
Share-based compensation expense related to share-based awards and employee stock purchase plan
−Removed: Noncontrolling interests on acquisition of VectivBio Holding AG
−Removed: Purchase of subsidiary shares from noncontrolling interests
−Removed: ( 1,002,239 )
−Removed: ( 1,002,239 )
−Removed: ( 1,031,559 )
−Removed: Other comprehensive loss, net of tax
−Removed: Balance at December 31, 2023
+Added: Taxes paid related to net share settlement of share-based awards
+Added: Other comprehensive income, net of tax
+Added: Balance as of December 31, 2024
( 1,697,735 )
1 unchanged sentence
Share-based compensation expense related to share-based awards and employee stock purchase plan
−Removed: Taxes paid related to net share settlement of share-based awards
−Removed: Other comprehensive income, net of tax
−Removed: Balance at December 31, 2024
+Added: Other comprehensive loss, net of tax
+Added: Balance as of December 31, 2025
( 1,673,718 )
5 unchanged sentences
Cash flows from operating activities:
−Removed: Net income (loss)
−Removed: ( 1,031,559 )
−Removed: Adjustments to reconcile net loss to net cash provided by operating activities:
+Added: Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
1 unchanged sentence
Share-based compensation expense
−Removed: Change in fair value of note hedge warrants
Non-cash interest expense
−Removed: Acquired in-process research and development
+Added: Non-cash lease expense
Deferred income taxes
2 unchanged sentences
Prepaid expenses and other current assets
−Removed: Operating lease right-of-use assets
Accounts payable and accrued expenses
5 unchanged sentences
Purchases of property and equipment
−Removed: Acquisition of VectivBio Holding AG, net of cash acquired
−Removed: ( 1,026,045 )
Net cash used in investing activities
−Removed: ( 1,026,318 )
Cash flows from financing activities:
1 unchanged sentence
Taxes paid related to net share settlement of share-based awards
−Removed: Purchase of subsidiary shares from noncontrolling interests
Repayment of 2024 Convertible Notes
−Removed: Repayment of 2022 Convertible Notes
Proceeds from revolving credit facility
1 unchanged sentence
Repayments of revolving credit facility
−Removed: Repurchases of common stock
Net cash provided by (used in) financing activities
−Removed: Effect of exchange rate changes on cash, cash equivalents and restricted cash
−Removed: Net increase (decrease) in cash, cash equivalents and restricted cash
−Removed: Cash, cash equivalents and restricted cash, beginning of period
−Removed: Cash, cash equivalents and restricted cash, end of period
−Removed: Reconciliation of cash, cash equivalents, and restricted cash to the consolidated balance sheets
−Removed: Cash and cash equivalents
−Removed: Restricted cash
−Removed: Total cash, cash equivalents, and restricted cash
+Added: Effect of exchange rate changes on cash and cash equivalents
+Added: Net increase (decrease) in cash and cash equivalents
+Added: Cash and cash equivalents, beginning of period
+Added: Cash and cash equivalents, end of period
Supplemental cash flow disclosure:
1 unchanged sentence
Cash paid for income taxes
−Removed: Non-cash investing and financing activities
−Removed: Stock option exercise proceeds receivable in other current assets
The accompanying notes are an integral part of these consolidated financial statements.
4 unchanged sentences
(“Ironwood” or the “Company”) is a biotechnology company developing and commercializing life-changing therapies for people living with gastrointestinal (“GI”) and rare diseases.
−Removed: The Company is focused on the development and commercialization of innovative GI product opportunities in areas of significant unmet need, leveraging its demonstrated expertise and capabilities in GI diseases.
+Added: The Company is focused on the development and commercialization of innovative product opportunities in areas of significant unmet need, leveraging its demonstrated expertise and capabilities in GI and rare diseases.
LINZESS® (linaclotide), the Company’s commercial product, is the first product approved by the United States Food and Drug Administration (the “U.S.
−Removed: FDA”) in a class of GI medicines called guanylate cyclase type C agonists (“GC-C agonists”) and is indicated for adult men and women suffering from irritable bowel syndrome with constipation (“IBS-C”) or chronic idiopathic constipation (“CIC”) and for pediatric patients ages 6-17 years-old suffering from functional constipation (“FC”).
−Removed: LINZESS is available to adult men and women suffering from IBS-C or CIC in the United States (the “U.S.”) and Mexico, adult men and women suffering from IBS-C or chronic constipation in Japan, and IBS-C in China, and pediatric patients ages 6-17 years old with FC in the U.S.
−Removed: 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.
+Added: FDA”) in a class of GI medicines called guanylate cyclase type C agonists (“GC-C agonists”) and is indicated, in the U.S., for the treatment of irritable bowel syndrome with constipation (“IBS-C”) in adults and pediatric patients 7 years of age and older, chronic idiopathic constipation (“CIC”) in adults, and functional constipation (“FC”) in pediatric patients ages 6-17 years-old.
+Added: 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.
+Added: 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.
The Company has strategic partnerships with leading pharmaceutical companies to support the development and commercialization of linaclotide throughout the world.
10 unchanged sentences
AstraZeneca AB (together with its affiliates) (“AstraZeneca”), the Company’s partner in China, has the exclusive right to develop, manufacture, and commercialize products containing linaclotide in China (including Hong Kong and Macau) (the “AstraZeneca License Territory”).
−Removed: Through the acquisition of VectivBio Holding AG (“VectivBio”), the Company is advancing apraglutide, a next-generation, synthetic peptide long-acting analog of glucagon-like peptide-2, developed for short bowel syndrome (“SBS”) patients who are dependent on parenteral support (“PS”).
−Removed: The acquisition of VectivBio is more fully described in Note 3, Acquisitions, to these consolidated financial statements.
−Removed: The Company also has IW-3300, a GC-C agonist, for the potential treatment of visceral pain conditions, such as interstitial cystitis / bladder pain syndrome (“IC/BPS”) and endometriosis.
−Removed: In the fourth quarter of 2024, the Company 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.
+Added: Through the acquisition of VectivBio Holding AG (“VectivBio”) in June 2023 (the “VectivBio Acquisition”), the Company is advancing apraglutide, a next-generation, synthetic peptide long-acting analog of glucagon-like peptide-2, developed for short bowel syndrome (“SBS”) patients who are dependent on parenteral support (“PS”).
The Company was incorporated in Delaware on January 5, 1998 as Microbia, Inc.
On April 7, 2008, the Company changed its name to Ironwood Pharmaceuticals, Inc.
−Removed: To date, the Company has dedicated a majority of its activities to the research, development and commercialization of linaclotide, as well as to the research and development of its other product candidates.
+Added: To date, the Company has dedicated a majority of its activities to the research, development and commercialization of linaclotide, as well as to other research and development programs, including apraglutide.
Summary of Significant Accounting Policies
3 unchanged sentences
All intercompany transactions and balances are eliminated in consolidation.
−Removed: For consolidated entities in which the Company owns less than 100% of the outstanding shares, the Company records net income (loss) and comprehensive income (loss) attributable to noncontrolling interests in its consolidated statements of income (loss) and comprehensive income (loss), respectively, equal to the percentage of the common stock ownership interest retained in such entities by the noncontrolling parties.
−Removed: The Company reports noncontrolling interests in consolidated entities as a component of equity separate from the Company’s equity.
Segment Information
2 unchanged sentences
The Company’s reportable business segment is more fully described in Note 16, Segment Reporting , to these consolidated financial statements.
−Removed: Reclassifications
−Removed: Certain prior period financial statement items have been reclassified to conform to current period presentation.
Use of Estimates
2 unchanged sentences
On an ongoing basis, the Company’s management evaluates its estimates, judgments and methodologies.
−Removed: Estimates and assumptions in the consolidated financial statements include those related to fair value of assets acquired and liabilities assumed in acquisitions;
−Removed: revenue recognition;
+Added: Estimates and assumptions in the consolidated financial statements include those related to revenue recognition;
accounts receivable;
15 unchanged sentences
The carrying amount of cash equivalents approximates fair value.
−Removed: The amount of cash equivalents included in cash and cash equivalents was $ 55.0 million and $ 58.7 million at December 31, 2024 and 2023, respectively.
−Removed: Restricted Cash
−Removed: The Company is contingently liable under unused letters of credit with a bank, related to the Company’s facility lease and vehicle lease agreements.
−Removed: Collateral used to secure letters of credit is classified as restricted cash.
−Removed: There was no restricted cash as of December 31, 2024 or 2023.
+Added: The amount of cash equivalents included in cash and cash equivalents was $ 184.3 million and $ 55.0 million as of December 31, 2025 and 2024, respectively.
Concentrations of Suppliers
15 unchanged sentences
The Company does not obtain collateral for its accounts receivable.
−Removed: The percentages of revenue recognized from significant collaborative partners of the Company in the years ended December 31, 2024, 2023, and 2022 and the account receivable balances, net of any payables due, at December 31, 2024 and 2023 are included in the following table:
+Added: The percentages of revenue recognized from significant collaborative partners of the Company in the years ended December 31, 2025 and 2024 and the account receivable balances, net of any payables due, as of December 31, 2025 and 2024 are included in the following table:
Year Ended December 31,
9 unchanged sentences
Included in property and equipment are certain costs of software obtained for internal use.
−Removed: Costs incurred during the preliminary project stage are expensed as incurred, while costs incurred during the application development
−Removed: stage are capitalized and amortized over the estimated useful life of the software.
+Added: Costs incurred during the preliminary project stage are expensed as incurred, while costs incurred during the application development stage are capitalized and amortized over the estimated useful life of the software.
The Company also capitalizes costs related to specific upgrades and enhancements when it is probable the expenditures will result in additional functionality.
17 unchanged sentences
Any changes to these estimates, based on the actual results obtained and/or a change in assumptions, could impact the Company’s income tax provision in future periods.
−Removed: Interest and penalty charges, if any, related to unrecognized tax benefits are classified as income tax expense in the Company’s consolidated statements of income (loss).
+Added: Interest and penalty charges, if any, related to unrecognized tax benefits are classified as income tax expense in the Company’s consolidated statements of income.
Financing Costs
4 unchanged sentences
The Company’s lease portfolio for the year ended December 31, 2025 included:
−Removed: an office lease for its headquarters location and other locations, vehicle leases for its salesforce representatives, and leases for computer and
−Removed: office equipment.
+Added: office leases for its current headquarters location and other locations, vehicle leases, and leases for computer and office equipment.
The Company determines if an arrangement is a lease at the inception of the contract and determines the classification of its leases at lease commencement.
12 unchanged sentences
Derivative Assets and Liabilities
−Removed: In June 2015, the Company issued 2.25 % Convertible Senior Notes due June 15, 2022 (the “2022 Convertible Notes”), and in August 2019, the Company issued 0.75 % Convertible Senior Notes due 2024 (the “2024 Convertible Notes”) and 1.50 % Convertible Senior Notes due 2026 (the “2026 Convertible Notes”, and together with the 2022 Convertible Notes and the 2024 Convertible Notes, the “Convertible Senior Notes”).
−Removed: In connection with the issuance of the 2022 Convertible Notes, the Company entered into convertible note hedge transactions (the “Convertible Note Hedges”) and separate note hedge warrant transactions (the “Note Hedge Warrants”), with certain financial institutions (Note 10).
−Removed: In connection with the partial repurchase of the 2022 Convertible Notes in August 2019, the Company terminated its Convertible Note Hedges and Note Hedge Warrants proportionately.
−Removed: The Convertible Note Hedges terminated unexercised upon expiry in June 2022 and the Note Hedge Warrants terminated unexercised upon expiry in April 2023.
−Removed: These instruments are derivative financial instruments under ASC Topic 815, Derivatives and Hedging (“ASC 815”).
−Removed: These derivatives are recorded as assets or liabilities at fair value each reporting date and the fair value is determined using the Black-Scholes option-pricing model.
−Removed: The changes in fair value are recorded as a component of other (expense) income in the consolidated statements of income.
−Removed: Significant inputs used to determine the fair value include the price per share of the Company’s Class A Common Stock, expected terms of the derivative instruments, strike prices of the derivative instruments, risk-free interest rates, and expected volatility of the Company’s Class A Common Stock.
−Removed: Changes to these inputs could materially affect the valuation of the derivative instruments.
−Removed: Cash flows related to the purchase and settlement of derivatives are classified as financing activities and gains and losses upon revaluation and settlement are classified as operating activities on the consolidated statement of cash flows.
−Removed: In August 2019, in connection with the issuance of the 2024 Convertible Notes and the 2026 Convertible Notes, the Company entered into the Capped Calls.
+Added: In August 2019, the Company issued 0.75 % Convertible Senior Notes due 2024 (the “2024 Convertible Notes”) and 1.50 % Convertible Senior Notes due 2026 (the “2026 Convertible Notes”).
+Added: In connection with the issuance of the 2024 Convertible Notes and the 2026 Convertible Notes, the Company entered into the Capped Calls (as defined in Note 9, Debt , below).
The Capped Calls cover the same number of shares of Class A Common Stock that initially underlie the 2024 Convertible Notes and the 2026 Convertible Notes (subject to anti-dilution and certain other adjustments).
−Removed: These instruments meet the conditions outlined in ASC 815 to be classified in stockholders’ equity (deficit) and are not subsequently remeasured as long as the conditions for equity classification continue to be met.
+Added: These instruments meet the conditions outlined in ASC Topic 815, Derivatives and Hedging (“ASC 815”) to be classified in stockholders’ equity (deficit) and are not subsequently remeasured as long as the conditions for equity classification continue to be met.
The Capped Calls related to the 2024 Convertible Notes expired unexercised upon maturity of the 2024 Convertible Notes in June 2024.
−Removed: Share Repurchases
−Removed: The Company accounts for repurchases of its Class A Common Stock on the trade date by recording the excess of the repurchase price over the par value entirely to additional paid-in capital.
−Removed: All repurchased shares are retired or constructively retired.
−Removed: Issued and outstanding shares are reduced by shares repurchased.
Revenue Recognition
16 unchanged sentences
The Company re-evaluates the probability of achievement of such milestones and any related constraint at each reporting period, and any adjustments are recorded on a cumulative catch-up basis.
−Removed: Agreements that include the supply of API or drug product for either clinical development or commercial supply at the customer’s discretion are generally considered as options.
+Added: Agreements that include the supply of active pharmaceutical ingredient (“API”) or drug product for either clinical development or commercial supply at the customer’s discretion are generally considered as options.
The Company assesses if these options provide a material right to its partner, and if so, they are accounted for as separate performance obligations.
44 unchanged sentences
Defined Benefit Pension Obligations
−Removed: Pension benefits earned during the year, as well as interest on projected benefit obligations, are accrued.
+Added: Pension benefits earned during the year, as well as interest on projected benefit obligations (“PBO”), are accrued.
Service costs are recognized within research and development expenses or selling, general and administrative expenses, depending on the function of the plan participant.
−Removed: Prior service costs and credits resulting from changes in plan benefits are generally amortized over the average remaining service period of the employees expected to receive benefits.
−Removed: Actuarial gains and losses are recognized in other income (expense), net, in the year in which they occur.
+Added: All other components of net period costs are recognized within other income (expense), net.
+Added: Prior service costs and credits resulting from changes in plan benefits are recognized in other comprehensive income (loss) in the period in which they occur and then amortized to net periodic benefit costs generally over the average remaining service period of the active participants.
+Added: Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are recognized in other comprehensive income (loss) in the period in which they occur.
+Added: To the extent such gains and losses exceed 10% of the PBO or the estimated fair value of plan assets, the excess is amortized into net periodic benefit costs, generally over the average remaining service period of the active participants.
The Company recognizes a pension plan’s funded status as either an asset or liability in its consolidated balance sheets.
8 unchanged sentences
For awards that contain performance conditions, the Company determines the appropriate amount to expense at each reporting date based on the anticipated achievement of performance targets, which requires judgement, including forecasting the achievement of future specified targets.
−Removed: At the date performance conditions are determined to be probable of achievement, the Company
−Removed: records a cumulative expense catch-up, with remaining expense amortized over the remaining service period.
+Added: At the date performance conditions are determined to be probable of achievement, the Company records a cumulative expense catch-up, with remaining expense amortized over the remaining service period.
Throughout the performance period, the Company re-assesses the estimated performance and updates the number of performance-based awards that it believes will ultimately vest.
4 unchanged sentences
As a result, if revisions are made to the Company’s underlying assumptions and estimates, the Company’s share-based compensation expense could vary significantly from period to period.
−Removed: The Company incurred and recorded as operating expense legal and other fees related to patents of $ 2.2 million, $ 1.8 million, and $ 1.3 million for the years ended December 31, 2024, 2023 and 2022, respectively.
−Removed: These costs were charged to selling, general and administrative expenses as incurred.
+Added: Legal and other fees related to patents are charged to selling, general and administrative expenses as incurred.
Net Income (Loss) Per Share
3 unchanged sentences
For subsidiaries with a different functional currency than the U.S.
−Removed: dollar, assets and liabilities are translated at the exchange rate as of the balance sheet date and income and expense items are translated at the average exchange rate for the reporting period.
−Removed: Adjustments resulting from the translation of the financial statements of foreign subsidiaries are recorded in accumulated comprehensive income (loss), a separate component of stockholders’ equity.
−Removed: The Company evaluates acquisitions of assets and other similar transactions to assess whether the transaction should be accounted for as a business combination or asset acquisition by first applying a screen test to determine whether substantially all of the fair value of the gross assets acquired is concentrated into a single identifiable asset or group of similar identifiable assets.
−Removed: If the screen test is met, a single asset or group of assets is not a business and is accounted for as an asset acquisition.
−Removed: If the screen test is not met, further determination is required as to whether the Company has acquired inputs and processes that have the ability to create outputs that would meet the requirements of a business.
−Removed: The Company accounts for business combinations using the acquisition method of accounting, which requires the acquiring entity to recognize the fair value of assets acquired and liabilities assumed and establishes the acquisition date as the fair value measurement point.
−Removed: The Company determines the fair value of assets acquired and liabilities assumed based on management’s estimate of the fair value of assets acquired and liabilities assumed in the acquisition.
−Removed: Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired.
−Removed: Transaction costs are expensed as incurred.
−Removed: The Company accounts for asset acquisitions that are not determined to be a business combination by recognizing net assets based on the consideration paid, inclusive of transaction costs, on a relative fair value basis.
−Removed: In an asset acquisition, the cost allocated to acquired in-process research and development (“IPR&D”) with no alternative future use is charged to research and development expense at the acquisition date.
−Removed: The Company classifies asset acquisitions of acquired IPR&D as investing activities on its consolidated statements of cash flows.
+Added: dollar, assets and liabilities are translated at the exchange rates as of the balance sheet date and income and expense items are translated at the average exchange rates for the reporting period.
+Added: Adjustments resulting from the translation of the financial statements of foreign subsidiaries are recorded in accumulated comprehensive income (loss), a separate component of stockholders’ deficit.
Comprehensive Income (Loss)
1 unchanged sentence
Other comprehensive income (loss) includes foreign currency translation adjustments and certain changes in the fair value of pension plan assets and projected benefit obligation attributed to the Company’s defined benefit pension plans.
−Removed: Accumulated other comprehensive income (loss) is presented as a separate component of stockholders’ equity (deficit).
+Added: Accumulated other comprehensive income (loss) is presented as a separate component of stockholders’ deficit.
Subsequent Events
1 unchanged sentence
Subsequent events have been evaluated through the filing of the financial statements accompanying this Annual Report on Form 10-K.
−Removed: Refer to Note 16 for subsequent events relating to workforce reductions and restructuring.
New Accounting Pronouncements
From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (the “FASB”) or other standard setting bodies that are adopted by the Company as of the specified effective date.
−Removed: The Company did not adopt any new accounting pronouncements during the year ended December 31, 2024 that had a material effect on its consolidated financial statements.
−Removed: In November 2023, the FASB issued Accounting Standards Update (“ASU”) No.
−Removed: 2023-07, Segment Reporting (Topic 280) (“ ASU 2023-07 ”).
−Removed: The guidance in ASU 2023-07 expands prior reportable segment disclosure requirements by requiring entities to disclose significant segment expenses that are regularly provided to the Chief Operating Decision Maker (“CODM”) and details of how the CODM uses financial reporting to assess their segment’s performance.
−Removed: The standard is effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.
−Removed: The ASU is required to be applied retrospectively upon adoption .
−Removed: The expanded disclosure requirements are included in the consolidated financial statements (Note 17).
+Added: Except as set forth below, the Company did not adopt any new accounting pronouncements during the year ended December 31, 2025 that had a material effect on its consolidated financial statements.
In December 2023, the FASB issued ASU No.
4 unchanged sentences
Upon adoption, ASU 2023-09 may be applied prospectively or retrospectively.
−Removed: The Company is currently evaluating the impact that the adoption of ASU 2023-09 may have on its disclosures in its annual consolidated financial statements.
+Added: The Company adopted ASU 2023-09 during the year ended December 31, 2025, on a prospective basis.
+Added: The expanded disclosures are included in the consolidated financial statements (Note 13).
In November 2024, the FASB issued ASU No.
9 unchanged sentences
The Company is currently evaluating the impact that the adoption of ASU 2024-04 may have on its disclosures in its consolidated financial statements.
+Added: In July 2025, the FASB issued ASU No.
+Added: 2025-05, Measurement of Credit Losses for Accounts Receivable and Contract Assets (“ASU 2025-05”).
+Added: The guidance in ASU 2025-05 amends ASC Topic 326, Financial Instruments—Credit Losses , to provide a practical expedient to simplify estimating expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under ASC Topic 606, Revenue from Contracts with Customers .
+Added: The practical expedient, if elected, allows entities to assume that current conditions as of the balance sheet date do not change for the remaining life of the asset.
+Added: The standard is effective for annual fiscal years beginning after December 15, 2025 and interim periods within fiscal years beginning after December 15, 2025, with early adoption permitted.
+Added: Entities that elect the practical expedient should apply the guidance prospectively.
+Added: The Company is currently evaluating the impact that the adoption of ASU 2025-05 may have on its consolidated financial statements.
+Added: In September 2025, the FASB issued ASU No.
+Added: 2025-06, Targeted Improvements to the Accounting for Internal-Use Software (“ASU 2025-06”).
+Added: The guidance in ASU 2025-06 amends certain aspects of the accounting for and disclosure of software costs under ASC Subtopic 350-40, Internal Use Software .
+Added: The standard is effective for fiscal years beginning after December 15, 2027 and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted.
+Added: Entities may elect to apply the guidance prospectively, retrospectively, or through a modified prospective transition method.
+Added: The Company is currently evaluating the impact that the adoption of ASU 2025-06 may have on its consolidated financial statements.
+Added: In September 2025, the FASB issued ASU No.
+Added: 2025-07, Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract (“ASU 2025-07”).
+Added: The guidance in ASU 2025-07 expands the scope exceptions within ASC Topic 815, Derivatives and Hedging , to include certain nonexchange-traded contracts with underlyings that are based on operations or activities specific to one of the parties to the contract, including research and development funding arrangements.
+Added: The standard is effective for annual fiscal years beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2026, with early adoption permitted.
+Added: Entities should apply the amendments either prospectively for contracts entered into on or after the date of adoption or on a modified retrospective basis through a cumulative-effect adjustment to the opening balance of retained earnings for contracts that exist as of the beginning of the annual reporting period of adoption.
+Added: The Company is currently evaluating the impact that the adoption of ASU 2025-07 may have on its consolidated financial statements.
+Added: In December 2025, the FASB issued ASU No.
+Added: 2025-11, Narrow-Scope Improvements (“ASU 2025-11”).
+Added: The guidance in ASU 2025-11 amends ASC Topic 270, Interim Reporting , to provide clarity on the current interim reporting requirements as well as requires entities to disclose events since the end of the last annual reporting period that have a material impact on the entity through the addition of the disclosure principle.
+Added: The standard is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted.
+Added: Upon adoption, ASU 2025-11 may be applied prospectively or retrospectively.
+Added: The Company is currently evaluating the impact that the adoption of ASU 2025-11 may have on its consolidated financial statements.
+Added: In December 2025, the FASB issued ASU No.
+Added: 2025-12, Codification Improvements (“ASU 2025-12”).
+Added: The guidance in ASU 2025-12 provides incremental improvements to accounting standards for a broad range of topics.
+Added: The standard is effective for annual fiscal years beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2026, with early adoption permitted.
+Added: Upon adoption, ASU 2025-12 may be applied prospectively or retrospectively on an issue-by-issue basis.
+Added: The Company is currently evaluating the impact that the adoption of ASU 2025-12 may have on its consolidated financial statements.
Other recent accounting pronouncements issued, but not yet effective, are not expected to be applicable to the Company or have a material effect on the consolidated financial statements upon future adoption.
−Removed: During the year ended December 31, 2022, the Company adopted the following accounting pronouncement that had a material effect on its consolidated financial statements:
−Removed: In August 2020, the FASB issued ASU No.
−Removed: 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging— Contracts in Entity’s Own Equity (Subtopic 815-40):
−Removed: Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”).
−Removed: The amendments in ASU 2020-06 simplify the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity.
−Removed: Under ASU 2020-06, embedded conversion features are no longer separately reported in equity and convertible debt instruments are now accounted for as a single liability measured at amortized cost, as long as no other features require bifurcation and recognition as derivatives.
−Removed: These changes reduce reported interest expense and increase reported net income for entities with convertible instruments that were bifurcated between liabilities and equity under previously existing guidance.
−Removed: Additionally, temporary differences between the book and tax bases resulting from the bifurcation of the embedded conversion feature under previously existing guidance have been eliminated and deferred tax assets and liabilities arising from such temporary differences are no longer reported.
−Removed: The new guidance also requires the if-converted method to be used in diluted earnings per share computations for all convertible instruments and revised the if-converted method to preclude the addback of interest expense to the numerator if the principal portions of the convertible instruments are required to be settled in cash.
−Removed: The standard became effective for public companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2021.
−Removed: Upon adoption, entities could elect to apply the new standard on a modified retrospective or full retrospective basis.
−Removed: The Company adopted ASU 2020-06 on January 1, 2022 using the modified retrospective approach, which resulted in a cumulative-effect adjustment recorded on the date of adoption as follows (in thousands):
−Removed: December 31, 2021
−Removed: Effect of the Adoption
−Removed: January 1, 2022
−Removed: Consolidated Balance Sheet
−Removed: of ASU 2020-06
−Removed: Deferred tax assets
−Removed: Current portion of convertible senior notes
−Removed: Long-term portion of convertible senior notes
−Removed: Additional paid-in-capital
−Removed: Retained earnings
−Removed: Interest expense recognized in subsequent periods is reduced as a result of accounting for convertible debt instruments as a single liability measured at amortized cost, with a decrease of $ 22.1 million of non-cash interest expense during the year ended December 31, 2022 compared to the year ended December 31, 2021 related to convertible debt instruments outstanding on the adoption date.
−Removed: The adoption of ASU 2020-06 did not impact the Company’s liquidity or cash flows.
−Removed: In June 2023, the Company completed a tender offer to purchase 98 % of the outstanding ordinary shares of VectivBio, a clinical-stage biotechnology company focused on the discovery and development of treatments for severe, rare GI conditions for which there is a significant unmet medical need, at a price per share of $ 17.00 , net to the shareholders of VectivBio in cash, without interest and subject to any applicable withholding taxes (the “VectivBio Acquisition”).
−Removed: In December 2023, the Company completed a squeeze-out merger under Swiss law to acquire all remaining outstanding ordinary shares in cash at a price per share of $ 17.00 , totaling $ 26.3 million, and VectivBio Holding AG was merged with and into Ironwood Pharmaceuticals GmbH, a wholly-owned subsidiary of Ironwood organized under the laws of Switzerland (the “Squeeze-out Merger”).
−Removed: The aggregate consideration paid by the Company to acquire the shares accepted for payment was approximately $ 1.2 billion.
−Removed: The Company financed the acquisition through proceeds from the borrowings under the Revolving Credit Agreement (as defined elsewhere below) and cash on hand.
−Removed: As of December 31, 2023, there was no remaining noncontrolling interest in VectivBio.
−Removed: The total purchase consideration for VectivBio is as follows (in thousands):
−Removed: Cash consideration paid to selling shareholders (1)
−Removed: Cash consideration paid to settle VectivBio restricted stock units (“RSUs”) and stock options (2)
−Removed: Cash consideration paid to settle VectivBio warrants (3)
−Removed: Transaction costs
−Removed: Fair value of noncontrolling interest (4)
−Removed: Total purchase consideration
−Removed: (1) The cash consideration paid to selling shareholders was determined based on the total number of the outstanding ordinary shares of VectivBio (the “VectivBio Shares”) tendered at closing of 61,258,315 at a per share price of $ 17.00 .
−Removed: (2) The cash consideration paid to settle VectivBio RSUs and stock options issued under VectivBio’s equity incentive plans was determined based on the total number of underlying VectivBio Shares of 8,904,171 at a per share price of $ 17.00 , less the exercise price for stock options.
−Removed: (3) The cash consideration paid to settle VectivBio warrants was determined based on the total number of VectivBio warrant shares outstanding at close of 324,190 at a per share price of $ 11.4757 calculated as the per share price of $ 17.00 , less the exercise price of $ 5.5243 per share.
−Removed: (4) The fair value of the noncontrolling interest was determined based on the total number of VectivBio Shares outstanding at closing of 1,547,723 at the closing date of the tender offer, using the VectivBio closing share price on June 28, 2023 of $ 16.94 .
−Removed: The VectivBio Acquisition was accounted for as an asset acquisition under Accounting Standards Codification (“ASC”) Topic 805, Business Combinations, because substantially all of the fair value of the gross assets acquired was concentrated in a single identifiable in-process research and development (“IPR&D”) asset, apraglutide, VectivBio’s lead investigational asset.
−Removed: Apraglutide is a next generation, long-acting synthetic GLP-2 analog being developed for SBS patients who are dependent on PS.
−Removed: The Company recognized the acquired assets and assumed liabilities based on the consideration paid, inclusive of transaction costs, on a relative fair value basis.
−Removed: In accordance with the accounting for asset acquisitions, an entity that acquires IPR&D assets in an asset acquisition follows the guidance in ASC Topic 730, Research and Development , which requires that both tangible and intangible identifiable research and development assets with no alternative future use be allocated a portion of the consideration transferred and recorded as research and development expense at the acquisition date.
−Removed: As a result, the Company recorded approximately $ 1.1 billion in acquired IPR&D expense related to the apraglutide IPR&D asset during the second quarter of 2023.
−Removed: The following is the allocation of the purchase consideration based on the relative fair value of assets acquired and liabilities assumed by the Company (in thousands):
−Removed: Assets acquired
−Removed: Cash and cash equivalents
−Removed: Prepaid expenses and other current assets
−Removed: Property and equipment
−Removed: Intangible assets
−Removed: Acquired in-process research and development
−Removed: Total assets acquired
−Removed: Liabilities assumed
−Removed: Current liabilities
−Removed: Other liabilities
−Removed: Total liabilities assumed
−Removed: Net assets acquired
−Removed: Acquisition-related expenses include direct and incremental costs incurred in connection with the transaction, including integration-related professional services and employee retention-related benefits.
−Removed: Acquisition-related expenses exclude transaction costs included in the computation of total consideration paid.
−Removed: The Company tracked and disclosed acquisition-related expenses incurred through the end of the second quarter of 2024.
−Removed: For the six months ended June 30, 2024, the Company incurred acquisition related expenses of $ 3.6 million , of which $ 1.1 million was included in selling, general, and administrative expenses and $ 2.5 million was included in restructuring expenses within the Company’s consolidated statement of income (loss).
−Removed: The Company incurred acquisition-related expenses of $ 55.6 million for the year ended December 31, 2023, of which $ 25.6 million was included in selling, general and administrative expenses, $ 15.1 million was included in research and development expense, and $ 14.9 million was included in restructuring expense within the Company’s consolidated statement of income (loss) for the year ended December 31, 2023.
−Removed: Intangible assets are comprised of the assembled workforce and are amortized on a straight-line basis over an estimated useful life of five years .
−Removed: The Company recognized $ 0.8 million of amortization expense during the year ended December 31, 2024.
−Removed: The Company recognized $ 0.4 million of amortization expense during the period between acquisition date on June 29, 2023 through December 31, 2023.
−Removed: The net carrying value of the assembled workforce at December 31, 2024 is $ 2.9 million.
−Removed: Future annual amortization expense will be $ 0.8 million for each of the years ended December 31, 2025 through December 31, 2027 and $ 0.4 million for the year ending December 31, 2028.
−Removed: Net Income (Loss) Per Share
−Removed: The following table sets forth the computation of basic and diluted net income (loss) per common share (in thousands, except per share amounts):
+Added: Net Income Per Share
+Added: The following table sets forth the computation of basic and diluted net income per common share (in thousands, except per share amounts):
Year Ended December 31,
−Removed: Net income (loss)
−Removed: ( 1,031,559 )
−Removed: Net loss attributable to noncontrolling interests
−Removed: Net income (loss) attributable to Ironwood Pharmaceuticals, Inc.
−Removed: ( 1,002,239 )
−Removed: Add back interest expense, net of tax benefit, on assumed conversion of 2024 Convertible Notes
−Removed: Add back interest expense, net of tax benefit, on assumed conversion of 2026 Convertible Notes
−Removed: Numerator used in computing net income (loss) per share — diluted
−Removed: ( 1,002,239 )
−Removed: Weighted average number of common shares outstanding used in computing net income (loss) per share — basic
+Added: Numerator used in computing net income per share — basic & diluted
+Added: Weighted average number of common shares outstanding used in computing net income per share — basic
Effect of dilutive securities:
−Removed: Stock options
−Removed: Time-based restricted stock units
−Removed: Performance-based restricted stock units
+Added: Time-based RSUs
+Added: Performance-based RSUs
Restricted stock
−Removed: 2024 Convertible Notes assumed conversion
−Removed: 2026 Convertible Notes assumed conversion
Dilutive potential common shares
−Removed: Weighted average number of common shares outstanding used in computing net income (loss) per share — diluted
−Removed: Net income (loss) per share — basic
−Removed: Net income (loss) per share — diluted
−Removed: (1) The Company incurred a net loss during the year ended December 31, 2023 and therefore did not differentiate basic and diluted earnings per share, as the effect of dilutive securities would be anti-dilutive.
+Added: Weighted average number of common shares outstanding used in computing net income per share — diluted
+Added: Net income per share — basic & diluted
The dilutive impact of the convertible senior notes is determined using the if-converted method.
2 unchanged sentences
The dilutive impact of all other types of dilutive securities is determined using the treasury stock method.
+Added: On December 15, 2025, the Company elected to settle conversions of the 2026 Convertible Notes through cash payment equal to the principal value and shares of Class A Common Stock for the conversion premium, if any (Note 9).
+Added: Accordingly, interest expense is added to the numerator and the calculated spread is added to the denominator only for the period the 2026 Convertible Notes were outstanding prior to the settlement method election, to the extent an assumed conversion is dilutive.
+Added: Interest expense was excluded from the numerator and there was no calculated spread added to the denominator because an assumed conversion would be anti-dilutive.
The outstanding securities set forth in the following table have been excluded from the computation of diluted weighted average shares outstanding, as applicable, as their effect would be anti-dilutive (in thousands):
1 unchanged sentence
Stock options
−Removed: Time-based restricted stock units
−Removed: Performance-based restricted stock units
−Removed: Note Hedge Warrants
+Added: Time-based RSUs
+Added: Performance-based RSUs
2026 Convertible Notes
−Removed: There was no dilutive impact of the 2024 Convertible Notes (as defined below) and the 2022 Convertible Notes for the year ended December 31, 2024 and December 31, 2022, respectively, because the Company had elected prior to the beginning of the period to settle the conversion of 2024 Convertible Notes and 2022 Convertible Notes, if any, with a combination settlement of a cash payment equal to the principal value of converted notes and shares of Class A Common Stock equal to the conversion value in excess of the principal value, if any (Note 10) .
−Removed: Accordingly, interest expense was not removed from the numerator and there was no calculated spread added to the denominator because the average market price of the Company’s Class A common stock during the portion of each period in which the 2024 Convertible Notes and the 2022 Convertible Notes were outstanding was not in excess of the conversion price.
+Added: There was no dilutive impact of the 2024 Convertible Notes for the year ended December 31, 2024 because the Company had elected prior to the beginning of the period to settle the conversion of 2024 Convertible Notes, if any, with a combination settlement of a cash payment equal to the principal value of converted notes and shares of Class A Common Stock equal to the conversion value in excess of the principal value, if any (Note 9) .
+Added: Accordingly, interest expense was removed from the numerator and there was no calculated spread added to the denominator because the average market price of the Company’s Class A Common Stock during the period was not in excess of the conversion price.
Collaboration, License, and Other Agreements
The Company has linaclotide collaboration agreements with AbbVie for North America and AstraZeneca for China (including Hong Kong and Macau), as well as linaclotide license agreements with Astellas for Japan and with AbbVie for the AbbVie License Territory.
−Removed: The following table provides amounts included in the Company’s consolidated statements of income (loss) as collaborative arrangements revenue attributable to transactions from these and other agreements (in thousands):
+Added: The following table provides amounts included in the Company’s consolidated statements of income as collaborative arrangements revenue attributable to transactions from these and other agreements (in thousands):
Year Ended December 31,
6 unchanged sentences
Other Agreements:
−Removed: Alnylam (GIVLAARI)
Asahi Kasei Pharma Corporation (apraglutide)
7 unchanged sentences
In September 2007, the Company entered into a collaboration agreement with AbbVie to develop and commercialize linaclotide for the treatment of IBS-C, CIC, and other GI conditions in North America.
−Removed: Under the terms of this collaboration agreement, the Company received an upfront licensing fee, equity investment, and development and
−Removed: regulatory milestones, and shares equally with AbbVie all development costs as well as net profits or losses from the development and sale of linaclotide in the U.S.
+Added: Under the terms of this collaboration agreement, the Company received an upfront licensing fee, equity investment, and development and regulatory milestones, and shares equally with AbbVie all development costs as well as net profits or losses from the development and sale of linaclotide in the U.S.
In addition, the Company receives 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.
−Removed: During the years ended December 31, 2024, 2023, and 2022, the Company incurred $ 7.4 million, $ 7.0 million, and $ 8.0 million, respectively, in total research and development expenses under the linaclotide collaboration for North America.
−Removed: As a result of the research and development cost-sharing provisions of the linaclotide collaboration for North America, the Company incurred $ 8.6 million, $ 11.6 million, and $ 8.9 million in incremental research and development costs during the years ended December 31, 2024, 2023, and 2022, respectively, to reflect the obligations of each party under the collaboration to bear 50 % of the development costs incurred.
+Added: During the years ended December 31, 2025 and 2024, the Company incurred $ 7.5 million and $ 7.4 million, respectively, in total research and development expenses under the linaclotide collaboration for North America.
+Added: As a result of the research and development cost-sharing provisions of the linaclotide collaboration for North America, the Company incurred $ 5.0 million and $ 8.6 million in incremental research and development costs during the years ended December 31, 2025 and 2024, respectively, to reflect the obligations of each party under the collaboration to bear 50 % of the development costs incurred.
The Company and AbbVie began commercializing LINZESS in the U.S.
9 unchanged sentences
Additionally, the Company receives royalties in the mid-teens percent based on net sales in Canada and Mexico.
−Removed: Royalties and net profit and loss sharing payments will be recorded as collaborative arrangements revenue or expense in the period earned, as these payments relate predominately to the license granted to AbbVie.
+Added: Royalties and net profit and loss sharing payments will be recorded as collaborative arrangements revenue or expense in the period earned, as these payments relate predominantly to the license granted to AbbVie.
The Company records royalty revenue in the period earned based on royalty reports from its partner, if available, or based on the projected sales and historical trends.
14 unchanged sentences
Total collaborative arrangements revenue
−Removed: The Company incurred $ 39.3 million, $ 37.1 million, and $ 34.3 million in total selling, general and administrative costs related to the sale of LINZESS in the U.S.
+Added: The Company incurred $ 4.4 million and $ 39.3 million in total selling, general and administrative costs related to the sale of LINZESS in the U.S.
in accordance with the cost-sharing arrangement with AbbVie for the years ended December 31, 2025 and 2024, respectively.
1 unchanged sentence
The Company records royalties on sales of CONSTELLA in Canada and LINZESS in Mexico in the period earned.
−Removed: The Company recognized $ 2.8 million, $ 2.8 million, and $ 2.7 million of combined royalty revenues from Canada and Mexico during the years ended December 31, 2024, 2023, and 2022, respectively.
+Added: The Company recognized $ 3.0 million and $ 2.8 million of combined royalty revenues from Canada and Mexico during the years ended December 31, 2025 and 2024, respectively.
License Agreement with AbbVie (All countries other than the countries and territories of North America, China (including Hong Kong and Macau), and Japan)
3 unchanged sentences
The license agreement also contains certain sales-based milestones and commercial launch milestones, which could total up to $ 42.5 million.
−Removed: The Company recognized $ 3.2 million, $ 2.8 million and $ 2.4 million of royalty revenue during the years ended December 31, 2024, 2023, and 2022, respectively.
+Added: The Company recognized $ 3.6 million and $ 3.2 million of royalty revenue during the years ended December 31, 2025 and 2024, respectively.
License Agreement for Japan with Astellas
2 unchanged sentences
These royalty payments are subject to reduction following the expiration of certain licensed patents and the occurrence of generic competition in Japan.
−Removed: During the years ended December 31, 2024, 2023, and 2022, the Company recognized $ 1.7 million, $ 1.8 million and $ 2.0 million of royalty revenue, respectively.
+Added: During the years ended December 31, 2025 and 2024, the Company recognized $ 1.7 million and $ 1.7 million of royalty revenue, respectively.
Collaboration Agreement for China (including Hong Kong and Macau) with AstraZeneca
2 unchanged sentences
In addition, AstraZeneca may be required to make milestone payments totaling up to $ 90.0 million contingent on the achievement of certain sales targets.
−Removed: During the years ended December 31, 2024, 2023, and 2022, the Company recognized $ 0.4 million, $ 0.4 million and $ 0.6 million of royalty revenue, respectively.
−Removed: At December 31, 2023, the Company had accounts receivable in the amount of $ 15.0 million related to the third and final installment of a non-contingent receivable due from AstraZeneca in connection with an amendment to the collaboration agreement executed during 2019.
−Removed: The non-contingent receivable was collected in full during the first quarter of 2024.
+Added: During the years ended December 31, 2025 and 2024, the Company recognized $ 0.3 million and $ 0.4 million of royalty revenue, respectively.
Apraglutide Agreements
14 unchanged sentences
In April 2024, VectivBio received the final development-related payment of JPY 500 million ($ 4.1 million at date of agreement).
+Added: During the second quarter of 2025, the Company recorded a $ 2.9 million reduction to cumulative collaborative arrangements revenue due to an increase in estimated development costs in connection with the confirmatory Phase III clinical trial needed to seek U.S.
+Added: FDA approval for apraglutide.
+Added: The Company recognized a net reduction of revenue in the amount of $ 1.9 million during the year ended December 31, 2025, related to development activities.
The Company recognized $ 2.2 million of revenue during the year ended December 31, 2024.
−Removed: The Company recognized $ 2.0 million of revenue during the period between the acquisition date of June 29, 2023 and December 31, 2023 related to development activities.
−Removed: As of December 31, 2024, current deferred revenue of $ 2.0 million and non-current deferred revenue of $ 1.8 million is reported within accrued expenses and other current liabilities and other
−Removed: liabilities, respectively, on the consolidated balance sheets.
−Removed: Deferred revenue and future payments received related to development activities are expected to be recognized over the course of the development activities, which are expected to occur through 2028.
+Added: As of December 31, 2025, current deferred revenue of $ 1.1 million and non-current deferred revenue of $ 5.3 million is reported within accrued expenses and other current liabilities and other liabilities, respectively, on the consolidated balance sheets.
+Added: Deferred revenue related to development activities is expected to be recognized over the course of the development activities, which are anticipated to be substantially complete by 2030.
License Agreement with Ferring
7 unchanged sentences
Such percentage is in the high single digits for sales of both licensed products and alternate drug products, and such payments are owed for the duration of the royalty term for licensed products or alternate drug products, as applicable.
+Added: On October 2, 2025, Ferring filed a complaint against VectivBio AG, for trade secret misappropriation and correction of patent inventorship and ownership in the U.S.
+Added: District Court in the Eastern District of Texas.
+Added: On December 18, 2025 , the Company and Ferring entered into an agreement to settle the claims for $ 12.5 million and amended the terms of the licensing agreement to require VectivBio AG to pay a low single-digit percentage royalty from the end of the seventh year from such first commercial sale through the date on which such licensed product ceases to be covered by a valid claim of a patent.
+Added: In connection with the settlement, the Company recorded a charge of $ 12.5 million as selling, general, and administrative expense in the consolidated statements of income during the year ended December 31, 2025.
+Added: VectivBio AG paid $ 7.5 million in December 2025 and is obligated to pay the remaining $ 5.0 million on or by December 31, 2026, subject to accelerated payment in certain circumstances.
+Added: As of December 31, 2025, the remaining obligation of $ 5.0 million is recorded in accrued expenses and other liabilities in the consolidated balance sheet.
Other Collaboration and License Agreements
Collaboration and License Option Agreement with COUR
−Removed: In November 2021, the Company entered into the COUR Collaboration Agreement, pursuant to which the Company was granted an option (the “Option”) to acquire an exclusive license to research, develop, manufacture and commercialize, in the U.S., products containing CNP-104 for the treatment of PBC.
+Added: In November 2021, the Company entered into the collaboration and license option agreement (the “COUR Collaboration Agreement”) with COUR Pharmaceutical Development Company, Inc.
+Added: (“COUR”), pursuant to which the Company was granted an option (the “Option”) to acquire an exclusive license to research, develop, manufacture and commercialize, in the U.S., products containing CNP-104 for the treatment of PBC.
COUR has initiated a Phase II clinical study to evaluate the safety, tolerability, and pharmacodynamic effects and efficacy of CNP-104 in PBC patients.
2 unchanged sentences
In connection with such payment, COUR also granted the Company a right of first negotiation over certain additional potential research and development programs.
−Removed: The $ 6.0 million payment was
−Removed: recognized as research and development expense in the second quarter of 2023.
+Added: The $ 6.0 million payment was recognized as research and development expense in the second quarter of 2023.
In the third quarter of 2024, the Company received from COUR the topline data from COUR’s Phase II clinical study for the treatment of PBC.
1 unchanged sentence
As a result, the collaboration and license option agreement between the Company and COUR has terminated, and the Company retains no rights and has no obligations related to CNP-104.
−Removed: Other Agreements
−Removed: Disease Education and Promotional Agreement with Alnylam
−Removed: In August 2019, the Company and Alnylam Pharmaceuticals, Inc.
−Removed: (“Alnylam”) entered into a disease education and promotional agreement (the “Alnylam Agreement”) for Alnylam’s GIVLAARI (givosiran) for the treatment of acute hepatic porphyria.
−Removed: The Alnylam Agreement, as amended, was terminated in June 2021 with an effective termination date of September 30, 2021.
−Removed: Under the terms of the Alnylam Agreement, the Company’s sales force performed disease awareness activities and sales detailing activities for GIVLAARI.
−Removed: The Company remained eligible to receive royalties based on a percentage of net sales of GIVLAARI that are directly attributable to the Company’s promotional efforts through September 30, 2022, which was one year following the termination of the agreement.
−Removed: During the year ended December 31, 2022 the Company recognized $ 2.2 million in royalty revenue.
Fair Value of Financial Instruments
13 unchanged sentences
Government Treasuries and Agencies.
−Removed: The Company utilizes a third-party custodian to manage the exchange of funds and ensure the collateral received is maintained at 102 % of the reverse repurchase agreements principal amount on a daily basis.
+Added: The Company uses a third-party custodian to manage the exchange of funds and ensure the collateral received is maintained at 102 % of the reverse repurchase agreements principal amount on a daily basis.
The following tables present the assets the Company has measured at fair value on a recurring basis (in thousands):
19 unchanged sentences
Total assets measured at fair value
−Removed: Cash equivalents, accounts receivable, prepaid expenses and other current assets, accounts payable, accrued research and development costs, accrued expenses and other current liabilities and current portion of operating lease obligations at December 31, 2024 and 2023 are carried at amounts that approximate fair value due to their short-term maturities.
+Added: Cash equivalents, accounts receivable, prepaid expenses and other current assets, accounts payable, accrued research and development costs, accrued expenses and other current liabilities and current portion of operating lease obligations as of December 31, 2025 and 2024 are carried at amounts that approximate fair value due to their short-term maturities.
Convertible Senior Notes
−Removed: In August 2019, the Company issued $ 200.0 million aggregate principal amount of its 0.75 % convertible senior notes due 2024 (the “2024 Convertible Notes”) and $ 200.0 million aggregate principal amount of its 1.50 % convertible senior notes due 2026 (the “2026 Convertible Notes”) (No te 10) .
−Removed: The fair value of the respective convertible senior notes, which differs from their carrying value, is influenced by interest rates, the price of the Company’s Class A Common Stock and the volatility thereof, and the prices for the respective convertible senior notes observed in market trading, which are Level 2 inputs.
−Removed: In June 2024, the Company repaid the aggregate principal amount of the 2024 Convertible Notes upon maturity (Not e 10) .
−Removed: The estimated fair value of the 2024 Convertible Notes was $ 209.6 million as of December 31, 2023.
+Added: In August 2019, the Company issued $ 200.0 million aggregate principal amount of its 2026 Convertible Notes (No te 9) .
+Added: The fair value of the 2026 Convertible Notes, which differs from their carrying value, is influenced by interest rates, the price of the Company’s Class A Common Stock and the volatility thereof, and the prices for the 2026 Convertible Notes observed in market trading, which are Level 2 inputs.
The estimated fair value of the 2026 Convertible Notes was $ 189.3 million and $ 186.6 million as of December 31, 2025 and 2024, respectively.
−Removed: Capped Calls with Respect to 2024 Convertible Notes and 2026 Convertible Notes
−Removed: In connection with the issuance of the 2024 Convertible Notes and the 2026 Convertible Notes, the Company entered into the Capped Calls with certain financial institutions.
−Removed: The Capped Calls cover 29,867,480 shares of Class A Common Stock (subject to anti-dilution and certain other adjustments), which is the same number of shares of Class A Common Stock that initially underlie the 2024 Convertible Notes and the 2026 Convertible Notes.
−Removed: The Capped Calls have an initial strike price of approximately $ 13.39 per share, which corresponds to the initial conversion price of the 2024 Convertible Notes and the 2026 Convertible Notes, and have a cap price of approximately $ 17.05 per share (Note 10).
−Removed: The strike price and cap price are subject to anti-dilution adjustments generally similar to those applicable to the 2024 Convertible Notes and the 2026 Convertible Notes.
+Added: Capped Calls with Respect to 2026 Convertible Notes
+Added: In connection with the issuance of the 2026 Convertible Notes, the Company entered into the Capped Calls (as defined in Note 9, Debt , below) with certain financial institutions.
+Added: The Capped Calls cover 14,933,740 shares of Class A Common Stock (subject to anti-dilution and certain other adjustments), which is the same number of shares of Class A Common Stock that initially underlie the 2026 Convertible Notes.
+Added: The Capped Calls have an initial strike price of approximately $ 13.39 per share, which corresponds to the initial conversion price of the 2026 Convertible Notes, and have a cap price of approximately $ 17.05 per share (Note 9).
+Added: The strike price and cap price are subject to anti-dilution adjustments generally similar to those applicable to the 2026 Convertible Notes.
These instruments meet the conditions outlined in ASC 815, to be classified in stockholders’ equity and are not subsequently remeasured as long as the conditions for equity classification continue to be met (Note 9).
1 unchanged sentence
Outstanding borrowings under the revolving credit facility (Note 9) are carried at amounts that approximate fair value based on their nature, terms, credit spreads, and variable interest rates, which are Level 3 inputs.
−Removed: Non-recurring Fair Value Measurements
−Removed: Acquired IPR&D
−Removed: The fair value of the acquired IPR&D asset, apraglutide, was determined using the multi-period excess earnings
−Removed: method using Level 3 fair value measurements and inputs including estimated cash flows and probabilities of success.
−Removed: Assembled Workforce
−Removed: The fair value of the assembled workforce was determined using the replacement cost method using Level 3 fair value measurements and inputs including estimated costs and productivity metrics .
The Company’s lease portfolio for the year ended December 31, 2025 included:
−Removed: an office lease for its current headquarters location and other locations, vehicle leases for its salesforce representatives, and leases for computer and office equipment.
+Added: an office lease for its current headquarters location and other locations, vehicle leases, and leases for computer and office equipment.
The Company’s headquarters office lease and vehicle leases require letters of credit totaling $ 0.6 million to secure the Company’s obligations under the lease agreements.
2 unchanged sentences
The components of lease cost for the years ended December 31, 2025 and 2024 are as follows (in thousands):
−Removed: Year Ended December 31,
Operating lease cost
11 unchanged sentences
The lease expense, inclusive of the escalating rent payments and lease incentives, is recognized on a straight-line basis over the lease term.
−Removed: At lease commencement, the Company recorded a right-of-use asset and a lease liability using an incremental borrowing rate of 5.8 %.
−Removed: At December 31, 2024, the balances of the right-of-use asset and operating lease liability were $ 11.0 million and $ 15.5 million, respectively.
−Removed: At December 31, 2023, the balances of the right-of-use asset and operating lease liability were $ 12.6 million and $ 17.7 million, respectively.
+Added: As of lease commencement, the Company recorded a right-of-use asset and a lease liability using an incremental borrowing rate of 5.8 %.
+Added: As of December 31, 2025, the balances of the right-of-use asset and operating lease liability were $ 9.3 million and $ 13.1 million, respectively.
+Added: As of December 31, 2024, the balances of the right-of-use asset and operating lease liability were $ 11.0 million and $ 15.5 million, respectively.
Lease costs recorded during each of the years ended December 31, 2025 and 2024 were $ 2.5 million.
Future minimum lease payments under the Summer Street Lease as of December 31, 2025 are as follows (in thousands):
−Removed: 2029 and thereafter
Total future minimum lease payments
6 unchanged sentences
Leasehold improvements
−Removed: Laboratory equipment
Furniture and fixtures
1 unchanged sentence
Less accumulated depreciation and amortization
−Removed: Depreciation expense of property and equipment was $ 1.2 million, $ 1.2 million and $ 1.4 million for the years ended December 31, 2024, 2023, and 2022, respectively.
+Added: Depreciation expense of property and equipment was $ 1.1 million and $ 1.2 million for the years ended December 31, 2025 and 2024, respectively.
Accrued Expenses and Other Current Liabilities
Accrued expenses and other current liabilities consisted of the following (in thousands):
−Removed: December 31, 2024
−Removed: December 31, 2023
Accrued compensation and benefits
+Added: Accrued litigation settlement
Accrued interest
Deferred revenue
−Removed: Accrued restructuring liabilities
Accrued taxes
+Added: Accrued restructuring liabilities
Total accrued expenses and other current liabilities
As of December 31, 2025 and 2024, other accrued expenses were comprised primarily of $ 9.4 million and $ 4.3 million of uninvoiced vendor liabilities, respectively.
−Removed: 2.25 % Convertible Senior Notes due 2022
−Removed: In June 2015, the Company issued $ 335.7 million aggregate principal amount of the 2022 Convertible Notes.
−Removed: The Company received net proceeds of $ 324.0 million from the sale of the 2022 Convertible Notes, after deducting fees and expenses of $ 11.7 million.
−Removed: The Company used $ 21.1 million of the net proceeds from the sale of the 2022 Convertible Notes to pay the net cost of the Convertible Note Hedges (after such cost was partially offset by the proceeds to the Company from the sale of the Note Hedge Warrants), as described below.
−Removed: In connection with the issuance of the 2024 Convertible Notes and the 2026 Convertible Notes in August 2019, the Company repurchased $ 215.0 million aggregate principal amount of the 2022 Convertible Notes.
−Removed: Such portion of the 2022 Convertible Notes were repurchased at a premium totaling $ 227.3 million.
−Removed: In June 2022, the Company repaid the remaining $ 120.7 million aggregate principal amount of the 2022 Convertible Notes upon maturity.
−Removed: The 2022 Convertible Notes were governed by an indenture (the “2022 Indenture”) between the Company and U.S.
−Removed: Bank National Association, as trustee (the “Trustee”).
−Removed: The 2022 Convertible Notes were senior unsecured obligations and bore cash interest at the annual rate of 2.25 %, payable on June 15 and December 15 of each year.
−Removed: The 2022 Convertible Notes matured on June 15, 2022.
−Removed: No conversions were exercised by holders of the 2022 Convertible Notes.
0.75 % Convertible Senior Notes due 2024 and 1.50 % Convertible Senior Notes due 2026
−Removed: In August 2019, the Company issued $ 200.0 million aggregate principal amount of the 2024 Convertible Notes and $ 200.0 million aggregate principal amount of the 2026 Convertible Notes, pursuant to separate indentures (each an
−Removed: “Indenture” and together the “Indentures”), between the Company and U.S.
−Removed: Bank National Association, as trustee (the
+Added: In August 2019, the Company issued $ 200.0 million aggregate principal amount of the 2024 Convertible Notes and $ 200.0 million aggregate principal amount of the 2026 Convertible Notes, pursuant to separate indentures (each an “Indenture” and together the “Indentures”), between the Company and U.S.
+Added: Bank National Association, as trustee (the “Trustee”).
The Company received net proceeds of $ 391.0 million from the sale of the 2024 Convertible Notes and 2026 Convertible Notes, after deducting fees and expenses of $ 9.0 million.
6 unchanged sentences
The initial conversion rate for the 2026 Convertible Notes is 74.6687 shares of Class A Common Stock (subject to adjustment as provided for in the Indenture) per $ 1,000 principal amount of the 2026 Convertible Notes, which is equal to an initial conversion price of approximately $ 13.39 per share.
−Removed: The Company will settle conversions of the 2026 Convertible Notes through payment or delivery, as the case may be, of cash, shares of the Company’s Class A Common Stock or a combination of cash and shares of Class A Common Stock, at the Company’s option (subject to, and in accordance with, the settlement provisions of the Indenture).
−Removed: Holders of the 2026 Convertible Notes may convert their notes at their option at any time prior to the close of business on the business day immediately preceding December 15, 2025 in multiples of $ 1,000 principal amount, only under the following circumstances:
−Removed: ● during any calendar quarter commencing after the calendar quarter ending on December 31, 2019 (and only during such calendar quarter), if the last reported sale price of Class A Common Stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130 % of the conversion price for the 2026 Convertible Notes on each applicable trading day;
−Removed: ● during the five -business day period after any five consecutive trading day period (the “measurement period”) in which the “trading price” (as defined in each Indenture) per $ 1,000 principal amount of the 2026 Convertible Notes for each trading day of the measurement period was less than 98 % of the product of the last reported sale price of Class A Common Stock and the conversion rate for the 2026 Convertible Notes on each such trading day;
−Removed: ● upon the occurrence of specified corporate events described in the Indenture.
−Removed: On or after December 15, 2025 until the close of business on the second scheduled trading day immediately preceding the applicable June 15, 2026, the holders of the 2026 Convertible Notes may convert their 2026 Convertible Notes, in multiples of $ 1,000 principal amount, regardless of the foregoing conditions.
+Added: The Company held the option to determine the settlement method for conversions of the 2026 Convertible Notes through payment or delivery, as the case may be, of cash, shares of the Company’s Class A Common Stock, or a combination of cash and shares of Class A Common Stock (subject to, and in accordance with, the settlement provisions of the applicable Indenture).
+Added: The Company has elected to settle conversion of the 2026 Convertible Notes through cash payment equal to the principal value and shares of Class A Common Stock for the conversion premium, if any.
+Added: Holders of the 2026 Convertible Notes had the right to convert their 2026 Convertible Notes at their option at any time prior to the close of business on the business day immediately preceding December 15, 2025 upon the occurrence of certain circumstances and no such conversions occurred.
+Added: On or after December 15, 2025, until the close of business on the second scheduled trading day immediately preceding June 15, 2026, holders may convert their 2026 Convertible Notes, in multiples of $ 1,000 principal amount, at the option of the holder.
Upon the occurrence of fundamental changes, as described in the Indenture, prior to the maturity date of the 2026 Convertible Notes, holders of such notes may require the Company to repurchase for cash all or a portion of their notes at a repurchase price equal to 100 % of the principal amount of the notes to be repurchased, plus accrued and unpaid interest.
5 unchanged sentences
The Company accounts for convertible debt instruments as a single liability measured at amortized cost.
−Removed: The Company’s outstanding balances for the convertible senior notes consisted of the following (in thousands):
−Removed: 2024 Convertible Notes
−Removed: 2026 Convertible Notes
+Added: The Company’s outstanding balance for the 2026 Convertible Notes consisted of the following (in thousands):
unamortized debt issuance costs
Net carrying amount
−Removed: In connection with the issuance of the 2024 Convertible Notes and the 2026 Convertible Notes, the Company incurred $ 9.0 million of debt issuance costs, which primarily consisted of initial purchaser’s discounts and legal and other professional fees.
−Removed: The debt issuance costs are reflected as a reduction in the carrying value of the convertible senior notes and recorded as interest expense over the life of the 2024 Convertible Notes and the 2026 Convertible Notes.
−Removed: The Company determined the expected life of the 2024 Convertible Notes and the 2026 Convertible Notes was equal to their approximately five and seven-year terms, respectively.
−Removed: The effective annual interest rate of the 2024 Convertible Notes for the period from the date of issuance through maturity was 1.2 % .
+Added: The outstanding balance of the 2026 Convertible Notes is classified as a current liability and non-current liability as of December 31, 2025 and December 31, 2024, respectively.
+Added: In connection with the issuance of the 2026 Convertible Notes, the Company incurred $ 4.5 million of debt issuance costs, which primarily consisted of initial purchaser’s discounts and legal and other professional fees.
+Added: The debt issuance costs are reflected as a reduction in the carrying value of the 2026 Convertible Notes and recorded as interest expense over the life of the 2026 Convertible Notes.
+Added: The Company determined the expected life of the 2026 Convertible Notes was equal to its approximately seven-year term.
The effective annual interest rate of the 2026 Convertible Notes for the period from the date of issuance through December 31, 2025 was 1.9 %.
5 unchanged sentences
Total interest expense
−Removed: Future minimum payments under the convertible senior notes as of December 31, 2024, are as follows (in thousands):
−Removed: Total future minimum payments under the convertible senior notes
−Removed: amounts representing interest
−Removed: unamortized debt issuance costs
−Removed: Convertible senior notes balance
Capped Calls with Respect to 2024 Convertible Notes and 2026 Convertible Notes
11 unchanged sentences
In May 2023, in connection with the VectivBio Acquisition, the Company entered into a credit agreement with Wells Fargo Bank, N.A., as administrative agent (in such capacity, the “Agent”), collateral agent, a letter of credit issuer and a lender, and the other agents, lenders and letter of credit issuers parties thereto (collectively, the “Lenders”).
−Removed: In September 2024, the Company, the Agent and the Lenders entered into the first amendment to the revolving credit agreement (as amended from time to time, the “Revolving Credit Agreement”) to, among other things, increase the quantum of the Revolving Credit Facility from $ 500.0 million to $ 550.0 million, extend the maturity date, and increase the Company’s permitted maximum consolidated secured net leverage ratio.
+Added: In September 2024, the Company, the Agent and the Lenders entered into the first amendment to the revolving credit agreement (as amended from time to time, the “Revolving Credit Agreement”) to, among other things, increase the borrowing capacity from $ 500.0 million to $ 550.0 million, extend the maturity date, and increase the Company’s permitted maximum consolidated secured net leverage ratio.
The Revolving Credit Agreement provides for a $ 550.0 million secured revolving credit facility (the "Revolving Credit Facility”), which includes a $ 10.0 million letter of credit subfacility, and loans made thereunder will mature on the earliest to occur of (i) December 31, 2028 or (ii) the date that is 91 days prior to the stated maturity date of the Company’s existing convertible notes then outstanding, unless, in the case of clause (ii), the Company’s minimum liquidity equals or exceeds certain agreed levels.
2 unchanged sentences
The Company pays a quarterly commitment fee of 0.30 % to 0.425 % on the daily amount by which the commitments under the Revolving Credit Agreement exceed the outstanding loans and letters of credit.
−Removed: The loans and other obligations under the Revolving Credit Agreement are secured by substantially all of the Company’s personal property, including a pledge of all the capital stock of subsidiaries held directly by the Company or
−Removed: any subsidiary that guarantees the Revolving Credit Agreement following the closing date (which pledge, in the case of any foreign subsidiary, is limited to 65 % of the voting stock), subject to certain customary exceptions and limitations.
+Added: The loans and other obligations under the Revolving Credit Agreement are secured by substantially all of the Company’s personal property, including a pledge of all the capital stock of subsidiaries held directly by the Company or any subsidiary that guarantees the Revolving Credit Agreement following the closing date (which pledge, in the case of any foreign subsidiary, is limited to 65 % of the voting stock), subject to certain customary exceptions and limitations.
The Revolving Credit Agreement generally prohibits any other liens on the assets of the Company and its restricted subsidiaries, subject to certain exceptions as described in the Revolving Credit Agreement.
6 unchanged sentences
The debt issuance costs are classified as other assets and are amortized on a straight-line basis over the term of the Revolving Credit Agreement.
−Removed: The Company had unamortized capitalized debt issuance costs of $ 3.9 million and $ 2.4 million at December 31, 2024 and 2023, respectively.
−Removed: The outstanding principal balance on the revolving credit facility was $ 385.0 million and $ 300.0 million as of December 31, 2024 and 2023, respectively.
−Removed: The following table sets forth total interest expense recognized related to Revolving Credit Agreement (in
+Added: The Company had unamortized capitalized debt issuance costs of $ 2.9 million and $ 3.9 million as of December 31, 2025 and 2024, respectively.
+Added: The outstanding principal balance on the Revolving Credit Facility was $ 385.0 million as of December 31, 2025 and 2024.
+Added: The following table sets forth total interest expense recognized related to Revolving Credit Agreement (in thousands):
Year Ended December 31,
11 unchanged sentences
As of December 31, 2025, the Company has ongoing studies in various pre-clinical and clinical trial stages.
−Removed: The Company’s most significant clinical trial expenditures are to contract research organizations.
+Added: The Company’s most significant clinical trial expenditures are to contract research organizations and contract manufacturing organizations.
These contracts are generally cancellable, with notice, at the Company’s option and do not have any significant cancellation penalties.
+Added: The Company has entered into a manufacturing supply agreement for apraglutide , which includes certain minimum purchase commitments .
+Added: The future minimum purchase commitments under this agreement range from $ 1.0 million to $ 3.9 million per year through 2030.
As permitted under Delaware law, the Company indemnifies its directors and certain of its officers for certain events or occurrences while such director or officer is, or was, serving at the Company’s request in such capacity.
11 unchanged sentences
While the outcome of these other claims cannot be predicted with certainty, management does not believe that the outcome of any of these ongoing legal matters, individually and in aggregate, will have a material adverse effect on the Company’s consolidated financial statements.
+Added: For details regarding the Ferring legal matter, refer to Note 4, Collaboration, License and Other Agreements.
Stockholders’ Equity
4 unchanged sentences
Class A Common Stock is entitled to one vote per share.
−Removed: The Company has reserved, out of its authorized but unissued shares of Class A Common Stock, sufficient shares to effect the conversion of the convertible senior notes and the Note Hedge Warrants pursuant to the terms thereof (Note 10).
+Added: The Company has reserved, out of its authorized but unissued shares of Class A Common Stock, sufficient shares to effect the conversion of the 2026 Convertible Notes pursuant to the terms thereof (Note 9).
The Company’s stockholders are entitled to dividends if and when declared by the board of directors.
−Removed: Share Repurchase Program
−Removed: In May 2021, the Company’s Board of Directors authorized a program to repurchase up to $ 150.0 million of the
−Removed: Company’s Class A Common Stock.
−Removed: The Company completed the share repurchase program in May 2022 and retired the repurchased shares.
−Removed: During the year ended December 31, 2022, the Company repurchased 10.8 million shares of Class A Common Stock at an aggregate cost of $ 123.4 million.
−Removed: For the overall program, under which repurchases commenced in December 2021, the Company repurchased 13.1 million shares of Class A Common Stock at an average price per share of $ 11.47 .
Employee Stock Benefit Plans
2 unchanged sentences
Year Ended December 31,
−Removed: Stock options
−Removed: Time-based restricted stock units
−Removed: Performance-based restricted stock units
+Added: Time-based RSUs
+Added: Performance-based RSUs
Restricted stock awards
Employee stock purchase plan
−Removed: VectivBio Holding AG stock options and RSUs accelerated upon change in control
+Added: Stock options
Total share-based compensation expense
6 unchanged sentences
Total share-based compensation expense included in operating expenses
−Removed: Income tax benefit
+Added: Income tax expense
Total share-based compensation expense, net of tax
−Removed: In connection with the VectivBio Acquisition, the Company incurred $ 27.5 million of share-based compensation expense during the second quarter of 2023 related to the vesting acceleration and settlement of outstanding VectivBio stock options and RSUs under VectivBio’s 2021 Equity Incentive Plan, of which $ 11.3 million was recorded within research and development expense and $ 16.2 million was recorded within selling, general and administrative expenses.
−Removed: Restructuring expenses include modifications to share-based awards held by employees impacted by various workforce reductions (Note 16).
+Added: Restructuring expenses include modifications to share-based awards held by employees impacted by certain workforce reductions (Note 15).
Stock Benefit Plans
1 unchanged sentence
the Amended and Restated 2019 Equity Incentive Plan (the “A&R 2019 Equity Plan”), the 2019 Equity Incentive Plan (the “2019 Equity Plan”), the Amended and Restated 2010 Employee Stock Purchase Plan (the “2010 Purchase Plan”) and the Amended and Restated 2010 Employee, Director, and Consultant Equity Incentive Plan (the “2010 Equity Plan”).
−Removed: At December 31, 2024, there were 12,606,159 shares available for future grant under the A&R 2019 Equity Plan and the 2010 Purchase Plan.
+Added: As of December 31, 2025, there were 9,920,123 shares available for future grant under the A&R 2019 Equity Plan and the 2010 Purchase Plan.
A&R 2019 Equity Plan
19 unchanged sentences
Restricted Stock Awards
−Removed: RSAs are granted to non-employee members of the board of directors under restricted stock agreements in accordance with the terms of the 2019 Equity Plan and the Company’s non-employee director compensation policy, effective May 2019.
+Added: RSAs are granted to non-employee members of the board of directors under restricted stock agreements in accordance with the terms of the Company’s equity plans and the Company’s non-employee director compensation policy, effective May 2019.
Annual restricted stock grants to each non-employee member of the board of directors vest in full on the date immediately preceding the next annual meeting of stockholders, provided the individual continues to serve on the Company’s board of directors through each vest date.
4 unchanged sentences
The weighted-average grant date fair value per share of RSAs granted during the years ended December 31, 2025 and 2024, was $ 0.80 and $ 5.70 , respectively.
−Removed: The total fair value of RSAs that vested during the years ended December 31, 2024, 2023, and 2022 was $ 1.0 million, $ 2.1 million, and $ 2.8 million, respectively.
+Added: The total fair value of RSAs that vested during the years ended December 31, 2025 and 2024 was $ 0.1 million and $ 1.0 million, respectively.
Restricted Stock Units
12 unchanged sentences
The weighted-average grant date fair value per share of time-based RSUs granted during the years ended December 31, 2025 and 2024 was $ 1.65 and $ 11.53 , respectively.
−Removed: The total fair value of time-based RSUs that vested during the years ended December 31, 2024, 2023, and 2022 was $ 22.0 million, $ 18.3 million, and $ 14.8 million, respectively.
+Added: The total fair value of time-based RSUs that vested during the years ended December 31, 2025 and 2024 was $ 3.6 million and $ 22.0 million, respectively.
Performance-based RSUs
1 unchanged sentence
PSUs currently outstanding vest upon the achievement of specified performance criteria over a three-year performance period, generally subject to the executive remaining in continuous service with the Company through the applicable vesting dates.
−Removed: The performance criteria applicable to the PSUs granted in 2022 were realizing relative total shareholder return goals (the “Relative TSR PSUs”).
−Removed: The performance criteria applicable to the PSUs granted in 2024 and 2023 consisted of an equal weighting of (i) Relative TSR PSUs and (ii) achieving specified stock price targets (the “Absolute TSR PSUs”).
+Added: The performance criteria applicable to the PSUs granted in 2025 consisted of relative total shareholder return goals (the “Relative TSR PSUs”).
+Added: The performance criteria applicable to the PSUs granted in 2024 consisted of an equal weighting of (i) Relative TSR PSUs and (ii) achieving specified stock price targets (the “Absolute TSR PSUs”).
The Relative TSR PSUs and Absolute TSR PSUs are valued using the Monte Carlo simulation method on the date of grant.
11 unchanged sentences
The weighted-average grant date fair value per share of PSUs granted during the years ended December 31, 2025 and 2024 was $ 0.17 and $ 14.91 , respectively.
−Removed: The total fair value of PSUs that vested during the years ended December 31, 2024, 2023, and 2022 was $ 9.8 million, $ 0.8 million and $ 1.7 million, respectively.
+Added: The total fair value of PSUs that vested during the years ended December 31, 2025 and 2024 was $ 1.0 million and $ 9.8 million, respectively.
Stock Options
7 unchanged sentences
(in thousands)
−Removed: Outstanding at December 31, 2023
−Removed: Outstanding at December 31, 2024
−Removed: Vested or expected to vest at December 31, 2024
−Removed: Exercisable at December 31, 2024
+Added: Outstanding as of December 31, 2024
+Added: ( 1,141,155 )
+Added: Outstanding as of December 31, 2025
+Added: Vested or expected to vest as of December 31, 2025
+Added: Exercisable as of December 31, 2025
(1) Amounts relating to stock options granted prior to the separation of the Company’s soluble guanylate cycle business, and certain other assets and liabilities, into Cyclerion Therapeutics, Inc.
(the “Separation”) on April 1, 2019 have not been adjusted to reflect the effect of the Separation on the Company’s stock price.
−Removed: The total intrinsic value of options exercised during the years ended December 31, 2024, 2023, and 2022 was $ 2.0 million, $ 0.2 million, and $ 0.9 million, respectively.
+Added: The total intrinsic value of options exercised during the year ended December 31, 2024 was $ 2.0 million.
The intrinsic value was calculated as the difference between the fair value of the Company’s Class A Common Stock at the date of exercise and the exercise price of the option issued.
3 unchanged sentences
Type of award:
+Added: Time-based RSUs
+Added: Performance-based RSUs
Restricted stock awards
−Removed: Time-based restricted stock units
−Removed: Performance-based restricted stock units
The total unrecognized share-based compensation cost will be adjusted for future changes in estimated forfeitures.
1 unchanged sentence
federal, state, and foreign income taxes.
−Removed: The components of income (loss) before income taxes during the years ended on December 31, 2024, 2023, and 2022 consisted of the following (in thousands):
+Added: The components of income before income taxes during the years ended on December 31, 2025 and 2024 consisted of the following (in thousands):
Year Ended December 31,
United States
−Removed: ( 1,174,601 )
−Removed: Income (loss) before income taxes
+Added: Income before income taxes
The components of the provision for (benefit from) income taxes during the years ended December 31, 2025 and 2024 consisted of the following (in thousands):
5 unchanged sentences
Income tax expense
−Removed: During the year ended December 31, 2024, the Company 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.
−Removed: During the year ended December 31, 2023, the Company 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.
+Added: During the year ended December 31, 2025, the Company 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, primarily for state income taxes in certain states in which state taxable income exceeded available net operating losses.
During the year ended December 31, 2024, the Company 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.
1 unchanged sentence
A reconciliation of income taxes computed using the U.S.
−Removed: federal statutory rate of 21 % to that reflected in the consolidated statements of income (loss) are as follows (in thousands):
+Added: federal statutory rate of 21 % to that reflected in the consolidated statements of income, after the adoption of ASU 2023-09, is as follows (in thousands, except percentages):
Year Ended December 31,
+Added: Income tax expense using U.S.
+Added: federal statutory rate
+Added: State income taxes, net of federal benefit (1)
+Added: Foreign tax effects
+Added: Statutory tax rate difference
+Added: Change in valuation allowance
+Added: Other foreign jurisdictions
+Added: Nontaxable or nondeductible items
+Added: Limitation on executive compensation
+Added: Stock compensation
+Added: Change in valuation allowance
+Added: Change in unrecognized tax benefits
+Added: Other adjustments
+Added: Income tax expense and effective tax rate
+Added: (1) State taxes in California, Colorado, Florda, Illinois, Massachusetts, New Jersey, New York, New York City and Pennsylvania comprised the majority of the tax effect in this category.
+Added: A reconciliation of income taxes computed using the U.S.
+Added: federal statutory rate of 21 % to that reflected in the consolidated statements of income, prior to the adoption of ASU 2023-09, is as follows (in thousands):
+Added: Year Ended December 31,
Income tax expense (benefit) using U.S.
federal statutory rate
−Removed: Acquisition accounting for VectivBio Acquisition
Foreign tax rate differential
−Removed: Disallowed transaction costs
Permanent differences
2 unchanged sentences
Excess tax benefits
−Removed: Fair market valuation of Note Hedge Warrants and Convertible Note Hedges
Expiring net operating losses and tax credits
23 unchanged sentences
On a periodic basis, the Company reassesses the valuation allowance on its deferred income tax assets, weighing positive and negative evidence to assess the recoverability of the deferred tax assets.
−Removed: As of December 31, 2024, the Company maintained a valuation allowance of $ 106.3 million on deferred tax assets not expected to be realized, related primarily to deferred tax assets acquired in the VectivBio Acquisition comprised primarily of net operating loss carryforwards in Switzerland, as well as certain state net operating losses and state tax credits that are expected to expire prior to utilization.
−Removed: As of December 31, 2023, the Company maintained a valuation allowance of $ 85.6 million on deferred tax assets not expected to be realized, related primarily to deferred tax assets acquired in the VectivBio Acquisition comprised primarily of net operating loss carryforwards in Switzerland, as well as certain tax credits that are expected to expire prior to utilization.
+Added: As of December 31, 2025 and 2024, the Company maintained a valuation allowance of $ 126.3 million and $ 106.3 million, respectively, on deferred tax assets not expected to be realized, related primarily to deferred tax assets acquired in the VectivBio Acquisition comprised primarily of net operating loss carryforwards in Switzerland, as well as certain state net operating losses and state tax credits that are expected to expire prior to utilization.
+Added: The valuation allowance increased by $ 20.0 million during the year ended December 31, 2025, primarily to offset foreign net operating losses incurred in Switzerland.
The valuation allowance increased by $ 20.6 million during the year ended December 31, 2024 primarily to offset the foreign net operating losses incurred in Switzerland, to offset certain state net operating losses that are expected to expire prior to utilization, and to offset certain US tax credits that are expected to expire prior to utilization.
−Removed: The valuation allowance increased by $ 82.6 million during the year ended December 31, 2023 primarily to offset the acquired foreign net operating losses from the VectivBio Acquisition, as well as in response to a state tax law change enacted in October 2023, in which the Company increased its valuation allowance on certain state tax credits that are expected to expire prior to utilization.
−Removed: Additionally, the Company increased its reserves for uncertain tax positions by $ 11.0 million in the second quarter of 2023 in connection with a liability assumed in the VectivBio Acquisition.
−Removed: Subject to the limitations described below, at December 31, 2024, the Company had federal net operating loss carryforwards of $ 260.5 million, of which $ 130.9 million is subject to expiration between 2035 and 2038 and $ 129.6 million may be carried forward indefinitely.
+Added: Subject to the limitations described below, as of December 31, 2025, the Company had federal net operating loss carryforwards of $ 190.3 million, of which $ 60.6 million is subject to expiration between 2036 and 2037 and $ 129.6 million may be carried forward indefinitely.
As of December 31, 2025, the Company had state net operating loss carryforwards of $ 286.5 million to offset future state taxable income, which is subject to expiration at various dates through 2040.
3 unchanged sentences
These ownership changes may limit the amount of net operating loss carryforwards and research and development credit carryforwards that can be utilized annually to offset future taxable income and taxes, respectively.
−Removed: In general, an ownership change, as defined by IRC
−Removed: Section 382, results from transactions increasing the ownership of certain stockholders or public groups in the stock of a corporation by more than 50 percentage points over a three-year period.
+Added: In general, an ownership change, as defined by IRC Section 382, results from transactions increasing the ownership of certain stockholders or public groups in the stock of a corporation by more than 50 percentage points over a three-year period.
The following table summarizes the changes in the Company’s unrecognized income tax benefits for the years ended December 31, 2025 and 2024 (in thousands):
1 unchanged sentence
Increases based on tax positions related to the current period
−Removed: Increases for tax positions assumed in VectivBio Acquisition
Decreases for tax positions in prior periods
Balance at the end of the period
−Removed: The Company had gross unrecognized tax benefits of $ 11.6 million, $ 98.2 million, and $ 102.6 million as of December 31, 2024, 2023, and 2022 , respectively .
−Removed: Of the $ 11.6 million of total unrecognized tax benefits at December 31, 2024, $ 7.5 million would, if recognized, affect the Company’s effective tax rate, and the remaining amount would not affect the Company’s effective tax rate, as it relates to a temporary timing difference.
+Added: The Company had gross unrecognized tax benefits of $ 11.9 million and $ 11.6 million as of December 31, 2025 and 2024, respectively .
+Added: Of the $ 11.9 million of total unrecognized tax benefits as of December 31, 2025, $ 7.8 million would, if recognized, affect the Company’s effective tax rate, and the remaining amount would not affect the Company’s effective tax rate, as it relates to a temporary timing difference.
Reserves for uncertain tax positions of $ 13.1 million and $ 11.8 million are recorded in other liabilities on the Company’s consolidated balance sheets as of December 31, 2025 and 2024, respectively.
The Company recognizes interest and penalties, if any, related to uncertain tax positions in income tax expense.
−Removed: The Company recognized $ 0.8 million, $ 1.0 million and an insignificant amount of interest and penalties related to uncertain tax positions during the years ended December 31, 2024, 2023, and 2022, respectively.
+Added: The Company recognized $ 0.9 million and $ 0.8 million of interest and penalties related to uncertain tax positions during the years ended December 31, 2025 and 2024, respectively.
As of December 31, 2025 and 2024, $ 6.0 million and $ 5.1 million of interest and penalties have been accrued, respectively.
2 unchanged sentences
The statute of limitations for assessment for foreign jurisdictions is open for tax years ended December 31, 2021 through the present.
−Removed: There are currently no foreign income tax audits in progress.
+Added: The Company made the following income tax payments (net of refunds received) during the year ended December 31, 2025 (in thousands):
+Added: Year Ended December 31,
+Added: US state and local
+Added: Total income tax payments (net of refunds received)
+Added: * The amount of income taxes paid during the year does not meet the 5% disaggregation threshold.
Retirement Plans
7 unchanged sentences
or (b) 75 % of the first $ 10,000 of employee contributions.
−Removed: During the years ended December 31, 2024, 2023, and 2022, the Company recorded $ 2.4 million, $ 2.2 million, and $ 2.2 million of expense, respectively, related to its 401(k) company match.
+Added: During the years ended December 31, 2025 and 2024, the Company recorded $ 1.2 million and $ 2.4 million of expense, respectively, related to its 401(k) company match.
Defined Benefit Retirement Plans
−Removed: As a result of the VectivBio Acquisition, the Company maintains defined benefit plans for employees in Switzerland and Belgium, as required by local laws.
−Removed: The pension plans provide employees retirement benefits and risk insurance for death and disability.
+Added: The Company maintains a defined benefit plan for employees in Switzerland, as required by local laws.
+Added: The pension plan provides employees retirement benefits and risk insurance for death and disability.
The contributions of employers and employees in general are defined in percentages of the insured’s salary.
1 unchanged sentence
The employee has the option to withdraw the capital on demand.
+Added: As is customary with Switzerland pension plans, the assets of the plan are invested in a collective fund with multiple employers.
+Added: The Company has no investment authority over the assets of the plan, which are held and invested by a Switzerland-based financial services provider.
+Added: The investment strategy of the Swiss Plan is managed by an independent asset manager with the objective of achieving a consistent long-term return which will provide sufficient funding for future pension obligations while limiting risk.
The Company updates the estimates used to measure employee benefit obligations in the fourth quarter and upon a remeasurement event to reflect the updated actuarial assumptions.
−Removed: Defined benefit plans in Switzerland were comprised of a basic plan and management plan during the year ended December 31, 2023.
−Removed: The participants in the management plan were terminated as of December 31, 2023 and plan assets were transferred to the participants during the year ended December 31, 2024.
−Removed: The basic plan is the only defined benefit plan in Switzerland as of December 31, 2024.
−Removed: The defined benefit plan in Belgium was maintained for one employee and has been terminated as of December 31, 2024.
−Removed: The following table summarizes the components of net periodic benefit costs (income) for the year ended December 31, 2024 and the period between the acquisition date of June 29, 2023 and December 31, 2023 (in thousands):
−Removed: Current service cost
−Removed: Amortization prior service cost
−Removed: Amortization of unrecognized actuarial gains/(losses)
−Removed: Interest cost
−Removed: Expected return on plan assets
−Removed: Curtailment and other
−Removed: Administration costs
−Removed: The amounts recognized in other comprehensive income with respect to the defined benefit pension plans for the year ended December 31, 2024 and the period between the acquisition date of June 29, 2023 and December 31, 2023 (in thousands):
−Removed: Amortization prior service cost
−Removed: Prior service (cost)/credit arising during financial year
−Removed: Amortization of unrecognized actuarial gains/(losses)
−Removed: Remeasurement (gain)/loss
−Removed: Actuarial (gains)/losses arising from plan experience
−Removed: Actuarial (gains)/losses arising from demographic assumption
−Removed: Actuarial (gains)/losses arising from financial assumptions
−Removed: Return on plan assets excluding interest income
−Removed: Expense (income) recognized in other comprehensive income
−Removed: The amount included in the consolidated statements of financial position arising from the Company’s obligation in respect to its defined benefit plan as of December 31, 2024, and 2023 (in thousands):
−Removed: Present value of defined benefit obligation
−Removed: Fair value of plan assets
−Removed: Net liability arising from defined benefit obligation
−Removed: Movements in the present value of the defined benefit obligation for the year ended December 31, 2024, and period between the acquisition date of June 29, 2023 and December 31, 2023 (in thousands):
−Removed: Beginning defined benefit obligation as of January 1, 2024/June 29, 2023
−Removed: Current service cost
−Removed: Contributions paid by employees
−Removed: Interest expense on defined benefit obligation
−Removed: Prior service (cost)/credit arising during financial year
−Removed: Remeasurement (gain)/loss on defined benefit obligation
−Removed: Benefits (paid)/deposited
−Removed: Foreign currency exchange (gains)/loss
−Removed: Ending defined benefit obligation as of December 31
−Removed: Movements in the fair value of plan assets for the year ended December 31, 2024, and period between the acquisition date of June 29, 2023 and December 31, 2023 (in thousands):
−Removed: Beginning fair value of plan assets as of January 1, 2024/June 29, 2023
−Removed: Return on plan assets excluding interest income
−Removed: Contributions paid by employer
−Removed: Contributions paid by employees
−Removed: Benefits (paid)/deposited
−Removed: Actuarial gain/(loss) on plan assets
−Removed: Administration expense
−Removed: Foreign currency exchange gains/(losses)
−Removed: Ending fair value of plan assets as of December 31
−Removed: The allocation of the assets of the different asset classes in the Switzerland basic plan corresponds to (in thousands):
−Removed: Ending fair value of plan assets as of December 31
−Removed: Assets in the preceding table are predominantly Level 2 assets in the fair value hierarchy, except for certain mortgage-backed securities valued at $ 1.9 million and $ 2.6 million at December 31, 2024 and 2023, respectively, which are Level 3 assets in the fair value hierarchy.
−Removed: The amounts reflected in the preceding table as of December 31, 2023 represent the allocation of assets for the Switzerland basic plan.
−Removed: The allocation of assets for the Switzerland management plan as of December 31, 2023 were not made available to the Company, as investment decisions are made by plan participants.
−Removed: Principal assumptions used for the purpose of the actuarial valuations were as follows:
−Removed: Discount rate
−Removed: Expected return on assets
−Removed: Expected rate of salary increase
−Removed: Expected rate of pension increase
−Removed: Mortality rate
−Removed: Future expected benefit payments based on the assumptions in the preceding table are as follows (in thousands):
−Removed: 2029 and thereafter
+Added: The defined benefit plan in Switzerland is comprised of a basic plan as of December 31, 2025 and 2024.
+Added: During each of the years ended December 31, 2025 and 2024, the Company recognized service cost expense in the amount of $ 1.0 million.
+Added: Additionally, during the year ended December 31, 2024, the Company recognized a $ 2.1 million curtailment due to terminations, which reduced net periodic pension cost.
+Added: During the year ended December 31, 2025, the Company recognized an increase in accumulated other comprehensive income of $ 0.8 million, primarily due to actuarial gains.
+Added: During the year ended December 31, 2024, the Company recognized decrease in accumulated other comprehensive income of $ 1.1 million, primarily due to the amortization of previously unrecognized actuarial losses.
+Added: During the year ended December 31, 2025, employer contributions and employee contributions were $ 0.7 million and $ 0.7 million, respectively, and benefits paid, inclusive of settlements, and net of deposits from pension plan assets totaled $ 6.8 million.
+Added: During the year ended December 31, 2024, employer contributions and employee contributions were $ 0.8 million and $ 0.8 million, respectively, and benefits paid, inclusive of settlements, and net of deposits from pension plan assets totaled $ 18.1 million.
+Added: The Company estimates future benefit payments from 2026 to 2030 to range from $ 0.8 million to $ 1.2 million per year, and from 2031 and thereafter to be $ 4.6 million.
+Added: As of December 31, 2025, the total fair value of pension plan assets was $ 13.0 million and the fair value of projected benefit obligations was $ 15.5 million, resulting in a net liability status of $ 2.5 million recorded as other liabilities.
+Added: As of December 31, 2024, the total fair value of pension plan assets was $ 15.7 million and the fair value of projected benefit obligations was $ 18.5 million, resulting in a net liability status of $ 2.8 million recorded as other liabilities.
+Added: The discount rate used in determining the projected benefit obligation as of December 31, 2025 and 2024 were 1.30 % and 1.00 %, respectively.
+Added: The accumulated benefit obligation was $ 15.0 million and $ 17.9 million as of December 31, 2025 and 2024, respectively.
+Added: The pension plan assets are predominantly comprised of Level 2 assets in the fair value hierarchy, primarily consisting of fixed income, equities and real estate, except for certain mortgage-backed securities valued at $ 1.8 million and $ 1.9 million as of December 31, 2025 and 2024, respectively, which are Level 3 assets in the fair value hierarchy.
Workforce Reductions and Restructuring
−Removed: In April 2023, the Company reduced its workforce by approximately 10 % of its headquarters-based personnel in an effort to further strengthen the operational efficiency of the organization.
−Removed: The workforce reduction was substantially completed during the second quarter of 2023.
−Removed: The Company recorded $ 3.4 million of restructuring expenses and adjustments, which are primarily comprised of employee severance, benefits and related costs, during the year ended December 31, 2023.
−Removed: In June 2023, the Company commenced the elimination of certain positions in connection with the VectivBio
−Removed: The majority of the eliminations were substantively completed during the year ended December 31, 2023.
+Added: In June 2023, the Company commenced the elimination of certain positions in connection with the VectivBio Acquisition.
+Added: The majority of the eliminations were substantially completed during the year ended December 31, 2023.
The Company recorded $ 0.2 million and $ 2.6 million of restructuring expenses, which are primarily comprised of employee severance, benefits and related costs, during the year ended December 31, 2025 and 2024, respectively.
+Added: In January 2025, following an analysis of its strategy and core business needs, and in an effort to streamline focus and support the continued development of the Company’s pipeline, the Company commenced a reduction in the Company’s workforce of approximately 50 %, primarily consisting of field-based sales employees.
+Added: The reduction in workforce was substantially completed during the first quarter of 2025.
+Added: During the year ended December 31, 2025, the Company recorded $ 17.6 million of restructuring expenses, primarily comprised of severance, benefits, and related costs.
+Added: In August 2025, the Company eliminated certain positions supporting apraglutide commercialization efforts, in consideration of delays in development timelines.
+Added: The reduction in workforce was comprised of 10 positions and was completed during the third quarter of 2025.
+Added: During the year ended December 31, 2025, the Company recorded $ 2.4 million of restructuring expenses, primarily comprised of severance, benefits, and related costs.
The following table summarizes the accrued liabilities activity recorded in connection with the reductions in workforce and related restructuring activities during the year ended December 31, 2025 and 2024, respectively (in thousands):
1 unchanged sentence
December 31, 2025
−Removed: Headquarters-based workforce reduction
+Added: January 2025 field-based sales employees reduction
+Added: August 2025 commercial-related workforce reduction
VectivBio Acquisition-related workforce reduction
3 unchanged sentences
VectivBio Acquisition-related workforce reduction
−Removed: In January 2025, following an analysis of its strategy and core business needs, and in an effort to streamline focus and support the continued development of the Company’s pipeline, the Company commenced a reduction in the Company’s workforce of approximately 50 %, primarily consisting of field-based sales employees.
−Removed: This reduction in workforce is expected to be substantially completed by the end of the first half of 2025.
−Removed: The Company estimates that, in connection with this reduction in its workforce, it will incur aggregate charges of approximately $ 20.0 million to approximately $ 25.0 million, primarily comprised of one-time employee severance and benefit costs.
−Removed: Of these charges, substantially all are expected to result in cash expenditures.
−Removed: The Company may incur additional costs not currently contemplated due to events associated with or resulting from the workforce reduction.
−Removed: The estimated charges that the Company expects to incur are subject to a number of assumptions, and actual results may differ materially from these estimates.
Segment Reporting
4 unchanged sentences
The CODM uses consolidated net income (loss) to understand and evaluate the Company’s operating performance and trends, to prepare and approve the annual budget, and to develop short-term and long-term operating plans.
−Removed: Revenues, costs and expenses, and other income (expense) are provided to the CODM as presented in the statement of income (loss).
+Added: Revenues, costs and expenses, other income (expense), and income tax expense are provided to the CODM as presented in the statement of income (loss).
Total assets are not reviewed by the CODM when evaluating the segment’s performance.
11 unchanged sentences
Net income (loss) per share—diluted (1)
−Removed: (1) The summation of quarterly diluted net income per share does not equate to the calculation for the full fiscal year, as quarterly calculations are performed on a discrete basis.
+Added: (1) The summation of quarterly basic and diluted net income per share does not equate to the calculation for the full fiscal year, as quarterly calculations are performed on a discrete basis.
(in thousands, except per share data)
3 unchanged sentences
Net income (loss)
−Removed: ( 1,089,478 )
−Removed: ( 1,031,559 )
−Removed: Net income (loss) attributable to Ironwood
−Removed: Pharmaceuticals, Inc.
−Removed: ( 1,062,187 )
−Removed: ( 1,002,239 )
−Removed: Comprehensive income (loss) attributable to Ironwood Pharmaceuticals, Inc.
−Removed: ( 1,062,187 )
−Removed: ( 1,005,207 )
−Removed: Net income per share—basic (1)
−Removed: Net income per share—diluted (1)
−Removed: (1) The summation of quarterly diluted net income per share does not equate to the calculation for the full fiscal year, as quarterly calculations are performed on a discrete basis.
+Added: Comprehensive income (loss)
+Added: Net income (loss) per share—basic (1)
+Added: Net income (loss) per share—diluted (1)
+Added: (1) The summation of quarterly basic and diluted net income per share does not equate to the calculation for the full fiscal year, as quarterly calculations are performed on a discrete basis.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.