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Item 1. Business

2025-03-31 compared with 2024-02-16 · 145 added, 166 removed, 536 unchanged (37% of the section changed)

We are a gastrointestinal, or GI, healthcare company dedicated to advancing the treatment of GI diseases and redefining the standard of care for GI patients.

We are a biotechnology company developing and commercializing life-changing therapies for people living with gastrointestinal, or GI, and rare diseases.

We are focused on the development and commercialization of innovative GI product opportunities in areas of significant unmet need, leveraging our demonstrated expertise and capabilities in GI diseases.

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FDA, in a class of GI medicines called guanylate cyclase type C agonists, or GC-C agonists, and is indicated for adult men and women suffering from irritable bowel syndrome with constipation, or IBS-C, or chronic idiopathic constipation, or CIC, and for pediatric patients ages 6-17 years-old suffering from functional constipation, or FC.

LINZESS is available to adult men and women suffering from IBS-C or CIC in the United States, or the U.S., Mexico, and Saudi Arabia, to adult men and women suffering from IBS-C or chronic constipation in Japan, IBS-C in China and for pediatric patients ages 6-17 with FC in the U.S.

Linaclotide is available under the trademarked name CONSTELLA ® to adult men and women suffering from IBS-C or CIC in Canada, and to adult men and women suffering from IBS-C in certain European countries.

LINZESS is available to adult men and women suffering from IBS-C or CIC in the United States, or the U.S., and Mexico, adult men and women suffering from IBS-C or chronic constipation in Japan, and adult men and women suffering from IBS-C in China, and pediatric patients ages 6-17 years old with FC in the U.S.

Linaclotide is available under the trademarked name CONSTELLA ® to adult men and women suffering from IBS-C or CIC and pediatric patients ages 6-17 years old with FC in Canada, and to adult men and women suffering from IBS-C in certain European countries.

We have strategic partnerships with leading pharmaceutical companies to support the development and commercialization of linaclotide throughout the world, including with AbbVie Inc.

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and all countries worldwide other than China (including Hong Kong and Macau) and Japan, AstraZeneca AB (together with its affiliates), or AstraZeneca, in China (including Hong Kong and Macau) and Astellas Pharma Inc., or Astellas, in Japan.

We also aim to leverage our leading development and commercialization capabilities in GI to bring additional treatment options to GI patients.

In June 2023, we completed a tender offer to purchase 98% of the outstanding ordinary shares of VectivBio Holding AG, or 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, or the VectivBio Acquisition.

In December 2023, we completed a squeeze-out merger to acquire all remaining shares.

The VectivBio Acquisition was partially funded with $400.0 million of borrowings under a new revolving credit facility, or the Revolving Credit Facility, as further described in Note 10, Debt , to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.

Through the acquisition, the Company is advancing apraglutide, a next-generation, synthetic peptide analog of glucagon-like peptide-2, or GLP-2, for rare gastrointestinal diseases, including short bowel syndrome dependent on parenteral support, also known as SBS-IF, as well as several earlier stage assets.

In November 2021, we entered into a collaboration and license option agreement, or the COUR Collaboration Agreement, with COUR Pharmaceutical Development Company, Inc., or COUR, that grants us an option to acquire an exclusive license to research, develop, manufacture and commercialize, in the U.S., products containing CNP-104, a tolerizing immune modifying nanoparticle, for the treatment of primary biliary cholangitis, or PBC.

We also aim to leverage our development and commercialization capabilities in GI to bring additional treatment options to GI patients.

Through our acquisition of VectivBio Holding AG, or VectivBio, in June 2023, or the VectivBio Acquisition, we are advancing apraglutide, a next-generation, synthetic long-acting peptide analog of glucagon-like peptide-2, or GLP-2, for short bowel syndrome patients, or SBS, who are dependent on parenteral support, or PS.

In February 2024, we announced positive topline results from our pivotal Phase III clinical trial, STARS, which evaluated the efficacy and safety of once-weekly subcutaneous apraglutide in reducing parenteral support dependency in adult patients with SBS-IF.

In January 2025, we initiated a rolling new drug application, or NDA, to the U.S.

FDA for apraglutide for use in adult patients with SBS who are dependent on PS, and plan to submit marketing applications to other regulatory authorities as well.

The COUR Collaboration Agreement granted us an option to acquire an exclusive license to research, develop, manufacture and commercialize, in the U.S., products containing CNP-104, a potential treatment for primary biliary cholangitis, or PBC, a rare autoimmune disease targeting the liver.

In the third quarter of 2024, we received from COUR the topline data from COUR’s Phase II Clinical study for the treatment of PBC.

In September 2024, we notified COUR of our decision not to exercise the option to acquire an exclusive license to CNP-104.

As a result, COUR Collaboration Agreement has terminated, and we retain no rights and have no obligations related to CNP-104.

We are also advancing IW-3300, a GC-C agonist, for the potential treatment of visceral pain conditions, such as interstitial cystitis / bladder pain syndrome, or IC/BPS, and endometriosis.

In September 2024, we decided to end further recruitment for the Phase II proof of concept study in IC/BPS and analyze the data once all currently enrolled patients complete the full 12-week study assessment, which will inform the next steps in the program.

We were incorporated in Delaware on January 5, 1998 as Microbia, Inc.

On April 7, 2008, we changed our name to Ironwood Pharmaceuticals, Inc.

To date, we have dedicated a majority of our activities to the research, development and commercialization of linaclotide, as well as to the research and development of our other product candidates.

To date, we have dedicated a majority of our activities to the research,

development and commercialization of linaclotide, as well as to the research and development of apraglutide and our other product candidates.

Drug development involves a high degree of risk and investment, and the status, timing and scope of our development programs are subject to change.

Important factors that could adversely affect our drug development efforts are discussed under the heading “Risk Factors” in this Annual Report on Form 10-K.

Performance Against 2024 Core Priorities

In 2024, our GI-focused strategy, building on our commercial success and GI development capabilities, continued to focus on three core priorities:

maximize LINZESS, strengthen and progress our innovative GI portfolio, and deliver sustained profits and generate cash flow.

maximize LINZESS, advance our GI pipeline, and deliver sustained profits and generate cash flow.

Maximize LINZESS

● We recognized $340.4 million in collaborative arrangements revenue related to sales of LINZESS in the U.S.

during the year ended December 31, 2023, a n increase of $31.7 million compared to the year ended December 31, 2022.

The increase was primarily driven by an increase in LINZESS prescription demand, partially offset by inventory channel fluctuations.

● In June 2023, the U.S.

FDA approved LINZESS as a once-daily treatment for pediatric patients ages 6-17 years-old with FC, making LINZESS the first and only FDA-approved prescription therapy for FC in this patient population.

The safety and effectiveness of LINZESS in patients with FC less than 6 years of age or in patients with IBS-C less than 18 years of age have not been established.

Additional clinical pediatric programs in IBS-C and FC are ongoing.

Strengthen and progress our innovative GI portfolio

● We are conducting a Phase III clinical trial, STARS, to assess the safety and efficacy of apraglutide in adult patients with SBS-IF, and expect to report topline results in March 2024.

In April 2023, the U.S.

FDA granted Fast Track Designation to apraglutide in SBS-IF.

In October 2023, we presented positive final data from the STARS Nutrition Phase II study of apraglutide in patients with SBS-IF and colon-in-continuity.

We are also conducting open label extension studies to further evaluate the efficacy, safety and tolerability of apraglutide in SBS-IF and to support potential submissions of marketing applications for apraglutide in the U.S., European Union, or E.U., and Japan.

● We are also conducting a Phase II exploratory study, STARGAZE, to evaluate apraglutide in patients with steroid-refractory gastrointestinal acute Graft versus Host Disease, or aGvHD, a life-threatening condition that occurs when immune cells from the donor attack a recipient’s healthy cells after an allogeneic hematopoietic stem cell transplant, and expect data in the first quarter of 2024.

● Through the COUR Collaboration Agreement, we and COUR are developing CNP-104 for the treatment of PBC, a rare autoimmune disease targeting the liver.

In December 2021, the U.S.

FDA granted Fast Track Designation to CNP-104.

COUR is currently conducting a clinical study to evaluate the safety, tolerability, pharmacodynamic effects and efficacy of CNP-104 in PBC patients, with topline data expected in the third quarter of 2024.

● We are developing IW-3300, a GC-C agonist, for the potential treatment of visceral pain conditions, including IC/BPS and endometriosis.

We successfully completed Phase I studies to evaluate the safety and tolerability of IW-3300 in healthy volunteers and are continuing the Phase II proof of concept study in IC/BPS.

during the year ended December 31, 2024, a decrease of $90.1 million compared to the year ended December 31, 2023.

The decrease was primarily driven by a decrease in our share of net profits from the sale of LINZESS in the U.S., which was driven by decreased net price (including a $43.0 million reduction to collaboration revenue as a result of changes in estimates of sales reserves and allowances associated with governmental and contractual rebates), partially offset by increases from prescription demand.

Advance GI Pipeline

● In February 2024, we announced positive topline results from our pivotal Phase III clinical trial, STARS, which evaluated the efficacy and safety of once-weekly subcutaneous apraglutide in reducing PS dependency in adult patients with SBS-IF, and in January 2025, we initiated a rolling NDA submission to the U.S.

FDA for apraglutide for use in adult patients with SBS who are dependent on PS.

We plan to submit marketing applications for other regulatory filings as well.

We are also conducting an open-label extension study, STARS Extend, to further assess the safety of apraglutide in adult patients with SBS-IF.

● Apraglutide has also been studied in patients with steroid-refractory gastrointestinal acute Graft versus Host Disease, or aGvHD, a life-threatening condition that occurs when immune cells from the donor attack a recipient’s healthy cells after an allogeneic hematopoietic stem cell transplant.

In March 2024, we announced positive, primary results up to Day 91 for our Phase II exploratory trial, STARGAZE, which evaluated the safety and tolerability of once-weekly apraglutide in aGvHD patients treated with standard of care, including systemic corticosteroids and ruxolitinib.

In December 2024, we decided to end further development of apraglutide for aGvHD to focus investment on other priorities.

● We are advancing IW-3300, a GC-C agonist, for the potential treatment of visceral pain conditions, such as IC/BPS and endometriosis.

Deliver sustained profits and cash flow

● In 2023, we recognized a net loss of approximately $1.0 billion, which included a non-recurring charge of approximately $1.1 billion for acquired in-process research and development in connection with the VectivBio Acquisition.

● We generated $103.5 million in cash from operations during the year ended December 31, 2024, ending the year with $88.6 million in cash and cash equivalents.

The following table presents the status and anticipated near-term catalysts of selected key development programs in our pipeline as of December 31, 2023:

The status of our development programs in the table above represents the ongoing phase of development and does not correspond to the completion of a particular phase.

Drug development involves a high degree of risk and investment, and the status, timing and scope of our development programs are subject to change.

Important factors that could adversely affect our drug development efforts are discussed under the heading “Risk Factors” in this Annual Report on Form 10-K.

IBS-C and CIC are chronic, functional GI disorders that afflict millions of sufferers worldwide.

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FDA approved a 72 mcg dose of linaclotide for the treatment of adult men and women with CIC.

We and AbbVie continue to explore ways to enhance the clinical profile of linaclotide by studying linaclotide in additional indications, populations, and formulations to assess its potential to treat various conditions.

In September 2020, based on Phase IIIb data demonstrating the efficacy and safety of LINZESS 290 mcg on the overall abdominal symptoms of bloating, pain and discomfort, in adult patients with IBS-C, the U.S.

FDA approved our Supplemental New Drug Application, or sNDA, to include a more comprehensive description of the effects of LINZESS in its approved label.

We and AbbVie continue to explore ways to enhance the clinical profile of LINZESS by studying linaclotide in additional indications, populations, and formulations to assess its potential to treat various conditions.

In September 2020, based on the Phase IIIb data of linaclotide 290 mcg on the overall abdominal symptoms of bloating, pain and discomfort, in adult patients with IBS-C, the U.S.

FDA approved our supplemental new drug application to include a more comprehensive description of the effects of LINZESS in its approved label.

In addition, we and AbbVie have established a nonclinical and clinical post-marketing plan with the U.S.

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The updated label modified the boxed warning for risk of serious dehydration and contraindication against use in children to those less than two years of age.

The boxed warning and contraindication previously applied to all children less than 18

years of age and less than 6 years of age, respectively.

The boxed warning and contraindication previously applied to all children less than 18 years of age and less than 6 years of age, respectively.

In June 2023, the U.S.

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CONSTELLA is the first, and to date, only drug approved in the European Union, or E.U., for IBS-C.

CONSTELLA first became commercially available in certain European countries beginning 2013.

CONSTELLA first became commercially available in certain European countries beginning in 2013.

AbbVie is commercializing CONSTELLA in a number of European countries, including the United Kingdom, Italy and Spain for adults with IBS-C.

AbbVie has exclusive rights to commercialize linaclotide in Canada as CONSTELLA and in Mexico as LINZESS.

CONSTELLA became commercially available in Canada in 2014 for adults with IBS-C or CIC.

LINZESS became commercially available in Mexico in 2014, and in Saudi Arabia in 2023, for adults with IBS-C or CIC.

CONSTELLA became commercially available in Canada in 2014 for adults with IBS-C or CIC and in 2024 for pediatric patients ages 6-17 years-old with FC.

LINZESS became commercially available in Mexico in 2014 for adults with IBS-C or CIC.

Astellas has rights to develop, manufacture and commercialize linaclotide in Japan.

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In 2019, AstraZeneca began commercializing LINZESS in China for adults with IBS-C.

Through the VectivBio Acquisition, we are advancing apraglutide, a next-generation, long-acting synthetic peptide analog of GLP-2, as a potentially differentiated therapeutic for rare diseases, including SBS-IF and aGvHD.

SBS is a malabsorption disorder caused by the loss of functional small intestine, with symptoms that include diarrhea, dehydration, malnutrition and weight loss.

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Patients suffer from SBS-IF when their gut function is reduced below the minimum function necessary for the absorption of macronutrients or water and electrolytes required to survive and, in the case of infants and children, to maintain health and growth.

We are conducting a Phase III clinical trial, STARS, to assess the safety and efficacy of apraglutide in adult patients with SBS-IF, and expect to report topline results in March 2024.

In October 2023, we presented positive final data from the STARS Nutrition Phase II study of apraglutide in patients with SBS-IF and colon-in-continuity.

We are also conducting a Phase II exploratory study, STARGAZE, to evaluate apraglutide in patients with steroid-refractory gastrointestinal aGvHD and expect data in the first quarter of 2024.

Through the COUR Collaboration Agreement, we and COUR are developing CNP-104 for the potential treatment of PBC, a rare autoimmune disease targeting the liver that affects approximately 130,000 people in the U.S., according to a study published in Clinical Gastroenterology and Hepatology in 2018 .

If successful, CNP-104 has the potential to be the first approved PBC disease modifying therapy.

In December 2021, the U.S.

FDA granted Fast Track Designation to CNP-104.

We are advancing IW-3300, a GC-C agonist, for the potential treatment of visceral pain conditions, including IC/BPS and endometriosis.

IC/BPS affects an estimated 4 to 12 million Americans, according to the Interstitial Cystitis Association as of 2022.

An estimated 4 million reproductive-age women in the U.S.

have diagnosed endometriosis, according to a study published in Gynecologic and Obstetric Investigation in 2017.

Both diseases have a limited number of treatment options available.

We successfully completed Phase I studies to evaluate the safety and tolerability of IW-3300 in healthy volunteers and are continuing the Phase II proof of concept study in IC/BPS.

We are also conducting an open-label extension study, STARS Extend, to further assess safety of apraglutide in adult patients with SBS-IF.

In January 2025, we initiated a rolling NDA submission for apraglutide for use in adult patients with SBS who are dependent on PS.

Apraglutide has also been studied in patients in patients with steroid-refractory GI aGvHD.

In December 2024, we decided to end further development of apraglutide for aGvHD to focus investment on other priorities.

We are also advancing IW-3300, a GC-C agonist, for the potential treatment of visceral pain conditions, such as IC/BPS and endometriosis.

Collaborations and Partnerships

As part of our GI-focused strategy, we have established development and commercial capabilities that we plan to leverage as we seek to bring multiple medicines to patients.

As part of our GI and rare disease focus, we have development and commercial capabilities that we plan to leverage as we seek to bring multiple medicines to patients.

We intend to play an active role in the development and commercialization of our products in the U.S., either independently or with partners that have strong capabilities.

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is highly dependent on the responsiveness of patients to fill prescriptions and other factors such as retail chain and wholesaler buying patterns, pricing and reimbursement and inventory channel levels.

Our collaborative arrangements revenue may continue to fluctuate as a result of the timing and amount of royalties from sales of linaclotide in the markets in which it is currently approved, or any other markets where linaclotide receives approval, as well as clinical and commercial milestones received and recognized under our strategic partnerships outside of the U.S.

Our collaborative arrangements revenue may continue to fluctuate as a result of the timing and amount of royalties from sales of linaclotide in the

markets in which it is currently approved, or any other markets where linaclotide receives approval, as well as clinical and commercial milestones received and recognized under our strategic partnerships outside of the U.S.

Collaboration Agreement for North America with AbbVie

In September 2007, we 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.

Under the terms of the collaboration agreement, we and AbbVie are jointly and equally funding the development and commercialization of LINZESS in the U.S., with equal share of any profits or losses.

Additionally, we granted AbbVie exclusive rights to develop and commercialize linaclotide in Canada and Mexico for which we receive royalties in the mid-teens percent on net sales in those countries.

Under the terms of this collaboration agreement, we received an upfront licensing fee, equity investment, and development and regulatory milestones, and we share 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, we receive royalties from AbbVie in the mid-teens percent based on net sales in Canada and Mexico.

AbbVie is solely responsible for the further development, regulatory approval and commercialization of linaclotide in those countries and funding any costs.

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On August 1, 2019, we and Astellas amended and restated the license agreement.

Under the terms of the amended and restated license agreement, Astellas is obligated to pay royalties to us at rates beginning in the mid-single-digits percent and escalating to low-double-digits percent, based on aggregate annual net sales in Japan of products containing linaclotide API.

Collaboration Agreement for China (including Hong Kong and Macau), with AstraZeneca

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In September 2019, we and AstraZeneca amended and restated the collaboration agreement, under which AstraZeneca obtained the exclusive right to develop, manufacture and commercialize products containing linaclotide in the territory.

Under the terms of the amended and restated agreement, we transferred all manufacturing responsibilities in China (including Hong Kong and Macau) to AstraZeneca, and we are entitled to receive non-contingent payments totaling $35.0 million in three installments through 2024, of which $15.0 million remained outstanding at December 31, 2023.

Under the terms of the amended and restated agreement, we transferred all manufacturing responsibilities in China (including Hong Kong and Macau) to AstraZeneca, and we were entitled to receive non-contingent payments totaling $35.0 million in three installments through 2024, with the final installment collected during the first quarter of 2024.

In addition, AstraZeneca may be required to make milestone payments totaling up to $90.0 million contingent on the achievement of certain sales targets and is required to pay tiered royalties to us at rates beginning in the mid-single-digits percent and increasing up to twenty percent based on the aggregate annual net sales of products containing linaclotide in the territory.

Collaboration and License Option Agreement with COUR

In November 2021, we entered into the COUR Collaboration Agreement with COUR, pursuant to which we have been granted an 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.

In December 2021, the U.S.

FDA granted Fast Track Designation to CNP-104.

COUR has initiated a clinical study to evaluate the safety, tolerability, and pharmacodynamic effects and efficacy of CNP-104 in PBC patients, with topline data expected in the third quarter of 2024.

Pursuant to the terms of the COUR Collaboration Agreement, we made an upfront, non-refundable payment of $6.0 million to COUR during the year ended December 31, 2021, and agreed to pay a non-contingent payment and milestone payments to COUR totaling $13.5 million in connection with certain development activities and regulatory milestones.

In April 2023, the Company and COUR executed an amendment to the COUR Collaboration Agreement, in which the Company agreed to pay a one-time, non-refundable, upfront payment of $6.0 million to COUR in exchange for the right to apply a credit of $6.6 million against future amounts due to COUR in connection with the exercise of the Option, commercial milestones, or royalties.

In connection with such payment, COUR also granted the Company a right of first negotiation over certain additional potential research and development programs.

After reviewing the data from the clinical study for CNP-104, if we exercise the option, we will pay COUR $28.4 million in exchange for the exclusive license.

Upon commercialization, we will pay royalties to COUR in the high-single digits to low-double digits percentage of the aggregated annual net sales in the U.S.

of products containing CNP-104, and COUR will be eligible to receive commercial milestone payments of up to $440.0 million over the term of the agreement.

Development and Commercialization Agreement with AKP

In March 2022, VectivBio entered into a development and commercialization agreement with Asahi Kasei Pharma Corporation, or AKP, in which VectivBio granted an exclusive license to AKP, with the right to sublicense in multiple tiers, to develop, commercialize and exploit products derived from apraglutide in Japan.

Pursuant to the terms of the development and commercialization agreement with AKP, VectivBio received an upfront payment of JPY 3,000 million ($24.6 million at date of agreement) and is eligible to receive development related payments of JPY 1,600 million in the aggregate ($13.1 million at date of agreement), development milestones of JPY 1,000 million ($8.2 million at date of agreement) and up to JPY 19,000 million ($155.8 million at date of agreement) of commercial and sales-based milestone payments.

We are also eligible to receive payments in the commercial period for manufacturing supply equal to cost-plus manufacturing mark-up and tiered royalties of up to a mid-double-digit percentage on product sales continuing until the later of (i) expiration of regulatory exclusivity in Japan, or (ii) expiration of the last valid patent claim that provides exclusivity to apraglutide in Japan, or the Royalty Term.

Pursuant to the terms of the development and commercialization agreement with AKP, VectivBio received an upfront payment of JPY 3,000 million ($24.6 million at date of agreement) and development-related payments of JPY 1,600 million in the aggregate ($13.1 million at date of agreement) and is eligible to receive development milestones of JPY 1,000 million ($8.2 million at date of agreement) and up to JPY 19,000 million ($155.8 million at date of agreement) of commercial and sales-based milestone payments.

VectivBio is also eligible to receive payments in the commercial period for manufacturing supply equal to cost-plus manufacturing mark-up and tiered royalties of up to a mid-double-digit percentage on product sales continuing until the later of (i) expiration of regulatory exclusivity in Japan, or (ii) expiration of the last valid patent claim that provides exclusivity to apraglutide in Japan, or the Royalty Term.

The development and commercialization agreement will terminate upon the expiration of the Royalty Term.

Our vision is to become the leading GI healthcare company.

To achieve this vision, we assembled a team with demonstrated success in creating, acquiring and partnering, developing, and commercializing medicines that can make a difference in patients’ lives.

We are dedicated to leveraging our development and commercial expertise to advance the treatment of GI diseases and redefine the standard of care for patients suffering from GI diseases.

Our strategy is focused on three core priorities:

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Maximize LINZESS

● Leveraging our U.S.-focused commercial capabilities in marketing, reimbursement, patient engagement, and sales to expand the commercial potential of LINZESS.

● Leveraging our U.S.-focused commercial capabilities with our partner, AbbVie, to expand the commercial potential of LINZESS.

● Exploring development opportunities to enhance the clinical profile of LINZESS by studying linaclotide in additional indications, populations, and formulations.

● Collaborating with global partners who share our vision, values, culture, and processes to develop and commercialize linaclotide outside of the U.S.

● Collaborating with global partners who share our vision, values, culture, and processes to develop and commercialize linaclotide outside the U.S.

Advance GI pipeline

● Advancing our GI pipeline programs, highlighted by apraglutide for the potential treatment of SBS-IF and CNP-104 for the potential treatment of PBC.

● Advancing our GI pipeline programs, highlighted by apraglutide for the potential treatment of SBS-IF.

● Evaluating strategic partnership options for our wholly owned GC-C agonist, IW-3300, for the potential treatment of IC/BPS and endometriosis.

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Until the launch of LINZESS, the only available branded prescription therapy for IBS-C and CIC in the U.S.

was AMITIZA® (lubiprostone), which was approved for the treatment of CIC in 2006, for the treatment of IBS-C in 2008, and for the treatment of opioid induced constipation in 2013.

AMITIZA is being commercialized in the U.S.

by Takeda Pharmaceuticals Limit ed, or Takeda.

AMITIZA also is being commercialized for the treatment of adults with CIC in certain European countries, including the United Kingdom and Switzerland by Sucampo AG, and for the treatment of chronic constipation in Japan by Mylan N.V.

Authorized generic versions of AMITIZA became available in the U.S.

was AMITIZA® (lubiprostone), which is approved for the treatments of CIC, IBS-C and opioid induced constipation.

Takeda Pharmaceuticals Limited, or Takeda’s AMITIZA is approved for commercialization in the U.S.

and in certain European countries, including the United Kingdom and Switzerland by Sucampo AG, for the treatment of adults with CIC, and for the treatment of chronic constipation in Japan by Mylan N.V.

Authorized generic versions of AMITIZA have been available in the U.S.

since January 2021.

TRULANCE® (plecanatide) was approved in the U.S.

for the treatment of CIC in adults in January 2017 and for the treatment of IBS-C in adults in January 2018 and is being commercialized in the U.S.

treatment of adults with IBS-C and CIC and is being commercialized in the U.S.

by Bausch Health Companies, or Bausch.

Shire plc obtained approval of MOTEGRITY™ (prucalopride) in the U.S.

for the treatment of CIC in adults in December 2018.

In April 2022, Ardelyx, Inc., or Ardelyx, launched IBSRELATM (tenapanor), a U.S.

FDA approved treatment for IBS-C in adults, and in August 2022, Vibrant Gastro Inc.

launched Vibrant, a drug-free capsule that the U.S.

FDA granted marketing authorization for the treatment of CIC in adults who have not experienced relief of their bowel symptoms by using laxative therapies at the recommended dosage for at least one month.

for the treatment of CIC in adults.

Ardelyx, Inc.’s, or Ardelyx, IBSRELA™ (tenapanor), is approved by the U.S.

FDA for the treatment for IBS-C in adults, and Vibrant Gastro Inc’s.

Vibrant, a drug-free capsule, is approved by the U.S.

FDA for the treatment of CIC in adults who have not experienced relief of their bowel symptoms by using laxative therapies at the recommended dosage for at least one month.

OTC laxatives such as MiraLAX® and DULCOLAX®, and lactulose, a prescription laxative treatment, are also available for the treatment of constipation.

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For example, for apraglutide, we compete with companies that are commercializing or developing drugs for SBS, such as Takeda, which currently distributes the GLP-2 analog teduglutide, marketed as GATTEX® (teduglutide) in the U.S.

and REVESTIVE® (teduglutide for injection) in Europe, and Zealand Pharma A/S, which is developing the GLP-2 analog glepaglutide for the treatment of SBS and which submitted an NDA to the U.S.

FDA in December 2023.

Hanmi Pharmaceutical is also developing a GLP-2 analog which is in Phase 2.

and REVESTIVE® (teduglutide for injection) in Europe, and Zealand Pharma A/S, or Zealand, which is developing glepaglutide, a long-acting GLP-2 analog, for the potential treatment of SBS for patients who are dependent on PS and is expecting to initiate an additional Phase III clinical trial in 2025 .

Hanmi Pharmaceutical is also developing a GLP-2 analog, to be administered once a month, and which is being evaluated in a Phase II clinical trial.

Products with other mechanisms of action may emerge as future competition.

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It is our objective that the supply of linaclotide be safe and effective, with redundancy built into critical steps of the supply chain, and that each of our collaboration partners are in a position to manage the supply and distribution of linaclotide in their respective territories through a combination of contract manufacturers and in-house manufacturing capabilities.

Linaclotide production consists of three phases—manufacture of the API (sometimes referred to as drug substance), manufacture of finished drug product and manufacture of finished goods.

Linaclotide production consists of three phases—manufacture of the active pharmaceutical ingredient, or API (sometimes referred to as drug substance), manufacture of finished drug product and manufacture of finished goods.

We and/or our partners have commercial supply agreements with multiple third-party manufacturers for the production of linaclotide API.

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We design and develop the manufacturing process for apraglutide together with contract development and manufacturing organizations, or CDMOs.

We utilize these CDMOs for the manufacture of apraglutide for human use.

We utilize these CDMOs to manufacture apraglutide for human use.

Although we intend to rely on third-party CDMOs to produce apraglutide, we have personnel with experience managing third-party CDMOs producing apraglutide in clinical or commercial quantities.

Our clinical trials of apraglutide currently use the product in the form of a lyophilized powder in vial that is solubilized and reconstituted with a diluent prior to injection.

We are also evaluating novel drug product presentations, with the goal of providing increased patient convenience and increased simplicity of the dosing and self-injection.

We are also evaluating novel drug product presentations for further development, with the goal of providing increased patient convenience and increased simplicity of the dosing and self-injection.

Sales and Marketing

For the foreseeable future, we intend to develop and commercialize our drugs in the U.S.

alone or with partners, and expect to rely on partners to develop and commercialize our drugs in territories outside the U.S.

For the foreseeable future, in the U.S., we intend to develop and commercialize LINZESS with our partner, AbbVie, and apraglutide, if approved, alone.

In territories outside the U.S., we expect to rely on partners to develop and commercialize our products and product candidates.

In executing our strategy, our goal is to retain oversight over the worldwide development and commercialization of our products by playing an active role in their commercialization or finding partners who share our vision, values, culture and processes.

To date, we have established a high-quality commercial organization dedicated to supporting our vision of becoming the leading GI healthcare company.

Our GI commercial capabilities, including marketing, patient engagement and sales, are designed to support our existing product as well as potential future internally and externally developed products.

We have core commercial capabilities in place, including marketing, patient engagement and key sales support roles, designed to support our existing product and for potential future internally and externally developed products, including apraglutide.

We are also coordinating efforts with our linaclotide partners to launch and maintain an integrated, global linaclotide brand.

By leveraging the knowledge base and expertise of our experienced commercial team and the insights of each of our linaclotide commercialization partners, we continually improve our collective marketing strategies.

We are currently in the process of planning for the commercial launch of apraglutide, if successfully developed and approved, for commercialization, in the U.S.

We are currently in the process of planning for the commercial launch of apraglutide, if approved, for commercialization, in the U.S.

and with partners in territories outside the U.S.

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patents listed in the U.S.

FDA publication, Approved Drug Products with Therapeutic Equivalence Evaluations, or the Orange Book, six granted European patents, most of which have been validated in available European countries, ten granted Japanese patents, three granted Chinese patents, 49 issued patents in other foreign jurisdictions, and numerous pending U.S., foreign and Patent Cooperation

Treaty, or PCT, patent applications.

FDA publication, Approved Drug Products with Therapeutic Equivalence Evaluations, or the Orange Book, six granted European patents, most of which have been validated in available European countries, ten granted Japanese patents, three granted Chinese patents, 61 issued patents in other foreign jurisdictions, and numerous pending U.S., foreign and Patent Cooperation Treaty, or PCT, patent applications.

We and our partners own, either jointly or individually, all of the issued patents and pending applications.

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The granted, unexpired European patents, which will expire between 2027 and 2036, some of which have received patent term extension, contain claims directed to the linaclotide molecule, pharmaceutical compositions thereof, uses of linaclotide to prepare medicaments for treating GI disorders, and room temperature stable formulations of linaclotide and their use in treating IBS-C and chronic constipation.

The granted, unexpired Chinese patents, which will expire between 2029 and 2032, the granted Japanese patents, which will expire between 2026 and 2036, some of which are subject to granted and potential patent term extension, and the granted patents in other foreign jurisdictions, which will expire between 2026 and 2034, some of which may be subject to potential patent term extension, contain claims directed to the linaclotide molecule, pharmaceutical compositions of linaclotide for use in treating GI disorders, and room temperature stable formulations of linaclotide.

unexpired Chinese patents, which will expire between 2029 and 2032, the granted Japanese patents, which will expire between 2026 and 2036, some of which are subject to granted and potential patent term extension, and the granted patents in other foreign jurisdictions, which will expire between 2026 and 2034, some of which may be subject to potential patent term extension, contain claims directed to the linaclotide molecule, pharmaceutical compositions of linaclotide for use in treating GI disorders, and room temperature stable formulations of linaclotide.

We have pending patent applications in certain countries worldwide that, if issued, will expire between 2029 and 2045 and which include claims covering the linaclotide molecule, methods of using linaclotide to treat GI disorders, the current commercial formulations of linaclotide and uses thereof to treat GI disorders and delayed release and other potential formulations of linaclotide.

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patent and five pending U.S.

non-provisional patent applications, as well as 27 pending foreign patent

applications related to apraglutide.

non-provisional patent applications, as well as 27 pending foreign patent applications related to apraglutide.

The granted U.S.

patent in this patent family claims a method of treating SBS, and the pending U.S.

patent in this patent family claims a method of treating SBS at certain doses, and the pending U.S.

and foreign patent applications contain composition-of-matter claims to ultrapure compositions of apraglutide, methods of manufacturing apraglutide, and methods of treatment using apraglutide.

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FDA, the European Medicines Agency, or EMA, and other regulatory authorities have very broad enforcement authority and failure to abide by applicable regulatory requirements can result in administrative or judicial sanctions being imposed on us, including warning letters, refusals of government contracts, clinical holds, civil penalties, injunctions, restitution, disgorgement of profits, recall or seizure of products, total or partial suspension of production or distribution, withdrawal of approval, refusal to approve pending applications, and civil or criminal prosecution.

Within the U.S., in addition to the U.S.

FDA, numerous federal, state and local authorities have jurisdiction over, or enforce laws related to, such activities, including the U.S.

Drug Enforcement Agency, Centers of Medicare & Medicaid Services, or CMS, the Department of Health and Human Services, or HHS, the U.S.

Department of Justice, state Attorneys General, state departments of health and state pharmacy boards.

FDA Approval Process

In the U.S., pharmaceutical products are subject to extensive regulation by the U.S.

The Federal Food, Drug and Cosmetic Act, or FDCA, and other federal and state statutes and regulations, as well as similar foreign regulations, govern, among other things, the research, development, testing, manufacture, storage, recordkeeping, approval, labeling, promotion and marketing, distribution, post-marketing requirements and assessments, post-approval monitoring and reporting, sampling, and import and export of pharmaceutical products.

No company may market a new drug in the U.S.

until it has submitted a new drug application, or NDA, to the U.S.

until it has submitted an NDA to the U.S.

FDA, and the U.S.

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● satisfactory completion of one or more U.S.

FDA inspections of the manufacturing facility or facilities at which the product, or components thereof, are produced to assess compliance with current GMP

requirements and to assure that the facilities, methods and controls are adequate to preserve the product’s identity, strength, quality and purity;

FDA inspections of the manufacturing facility or facilities at which the product, or components thereof, are produced to assess compliance with current GMP requirements and to assure that the facilities, methods and controls are adequate to preserve the product’s identity, strength, quality and purity;

● satisfactory completion of any U.S.

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and local regulations must be followed appropriately.

Additionally, some clinical trials are overseen by an independent group of qualified experts organized by the clinical trial sponsor, known as a data monitoring committee.

This group may recommend continuation of the trial as planned, changes in trial conduct, or cessation of the trial at designated checkpoints based on access to certain data from the trial.

Clinical trials involve the administration of the product candidate to humans under the supervision of qualified investigators, generally physicians not employed by or under the trial sponsor’s control.

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We may also suspend clinical trials at any time on various grounds.

The results of the non-clinical and clinical studies, together with other detailed information, including the manufacture and composition of the product candidate, are submitted to the U.S.

Sponsors of clinical trials of certain U.S.

FDA-regulated products, including prescription drugs, are required to register and disclose certain clinical trial information on a public registry maintained by the National Institutes of Health.

The failure to submit clinical trial information to clinicaltrials.gov is a prohibited act under the FDCA with violations subject to potential civil monetary penalties, injunctions and/or criminal prosecution or disqualification from federal grants.

The results of the non-clinical studies and clinical trials, together with other detailed information, including the manufacture and composition of the product candidate, are submitted to the U.S.

FDA in the form of an NDA requesting approval to market the drug.

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FDA will “file” the application and begin review.

In the event it does not, the U.S.

FDA will issue a “refuse-to-file” determination and request additional information before filing the NDA.

FDA reviews an NDA pursuant to certain timelines and goals established by the Prescription Drug User Fee Act.

The review process, however, may be extended by U.S.

FDA requests for additional information, non-clinical or clinical studies, clarification regarding information already provided in the submission, or submission of a REMS.

FDA may refer an application to an advisory committee for review, evaluation and recommendation as to whether the application should be approved.

FDA is not bound by the recommendations of an advisory committee, but

it considers such recommendations carefully when making decisions.

FDA may refer an application to an advisory committee for review, evaluation and

recommendation as to whether the application should be approved.

FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions.

Before approving an NDA, the U.S.

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FDA may refuse to approve an NDA if applicable regulatory criteria are not satisfied or may require additional testing or information.

FDA may also limit the indications for use and/or require post marketing testing and surveillance to monitor the safety or efficacy of a product.

FDA decides not to approve an NDA, it will issue a Complete Response Letter outlining the deficiencies in the application and need for additional data and information.

If FDA approves an NDA, it may also limit the indications for use and/or require post marketing testing and surveillance to monitor the safety or efficacy of a product.

Once granted, product approvals may be withdrawn if compliance with regulatory standards is not maintained or problems are identified following initial marketing.

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FDA may not accept, or approve, an application for a generic drug, whether the application for such drug is submitted through an ANDA or a through another form of application, known as a 505(b)(2) application.

The Hatch-Waxman Act grants five years of exclusivity when a company develops and gains NDA approval of a new chemical entity that has not been previously approved by the U.S.

This type of NDA authorizes the U.S.

FDA to approve a follow-on product on the basis of, among other things, the U.S.

FDA’s previous findings of safety and effectiveness for a reference product.

The Hatch-Waxman Act grants five years of regulatory exclusivity when a company develops and gains NDA approval of a new chemical entity that has not been previously approved by the U.S.

This exclusivity provides that the U.S.

FDA may not accept an ANDA or 505(b)(2) application for five years after the date of approval of previously approved drug, or four years in the case of an ANDA or 505(b)(2) application that challenges a patent claiming the reference drug (see discussion below regarding Paragraph IV Certifications).

The Hatch ‑ Waxman Act also provides three years of exclusivity for approved applications for drugs that are not new chemical entities, if the application contains the results of new clinical investigations (other than bioavailability studies) conducted or sponsored by the applicant that were essential to approval of the application.

The Hatch-Waxman Act also provides three years of regulatory exclusivity for approved applications for drugs that are not new chemical entities, if the application contains the results of new clinical investigations (other than bioavailability studies) conducted or sponsored by the applicant that were essential to approval of the application.

Examples of applications that may require new clinical investigations essential to approval and receive three-year exclusivity include applications for new indications, dosage forms (including new drug delivery systems), strengths, or conditions of use for an already approved product.

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A certification that a listed patent is invalid, unenforceable or will not be infringed by the sale of the proposed product is called a “Paragraph IV” certification.

A certification that provides the date a listed patent will expire, but does not challenge the validity,

enforceability or infringement of the patent, is called a “Paragraph III” certification.

A certification that provides the date a listed patent will expire, but does not challenge the validity, enforceability or infringement of the patent, is called a “Paragraph III” certification.

FDA can approve the ANDA or 505(b)(2) application containing the Paragraph III certification upon expiration of the patent.

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FDA approval for that drug for the disease for which it has such designation, the product is entitled to orphan drug exclusivity, which means that the U.S.

FDA may not approve any other applications to market the same drug for the same indication for seven years following product approval unless the subsequent product candidate is demonstrated to be clinically superior on the basis of greater efficacy or safety, or by providing a major contribution to patient care.

Absent a showing of clinical superiority, the U.S.

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FDA center responsible for premarket review of the drug product would have primary jurisdiction for the drug-device combination product.

FDA has also established an Office of Combination Products to address issues surrounding combination products and provide more certainty to the regulatory review process.

established an Office of Combination Products to address issues surrounding combination products and provide more certainty to the regulatory review process.

That office serves as a focal point for combination product issues for agency reviewers and industry.

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Although physicians may prescribe legally available drugs for off-label uses, manufacturers may not market or promote such off-label uses.

In January 2025, the U.S.

FDA published final guidance outlining the agency’s non-binding policies governing the distribution of scientific information on unapproved uses to healthcare providers.

This final guidance calls for such communications to be truthful, non-misleading, factual, and unbiased and include all information necessary for healthcare providers to interpret the strengths and weaknesses and validity and utility of the information about the unapproved use.

Changes to some of the conditions established in an approved application, including changes in indications, labeling, or manufacturing processes or facilities, require submission and U.S.

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Foreign Corrupt Practices Act, or FCPA, which prohibits U.S.

corporations and their representatives from offering, promising, authorizing, or making payments to any foreign

government official, government staff member, political party or political candidate in an attempt to obtain or retain business abroad.

corporations and their representatives from offering, promising, authorizing, or making payments to any foreign government official, government staff member, political party or political candidate in an attempt to obtain or retain business abroad.

The scope of the FCPA encompasses certain healthcare professionals in many countries.

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Ongoing clinical trials authorized under CTD with at least one active site in the E.U.

on January 30, 2025 must be transitioned to CTR.

on January 30, 2025 needed to be transitioned to CTR.

Active site in the context of transitioning means that the last visit of the last subject, or the other trial-related interventions with the subject specified in the protocol, will take place after January 30, 2025.

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Marketing Authorization .

To obtain a marketing authorization to market a medicinal product in the EEA, an applicant must submit an MAA, either in accordance with a centralized procedure administered by the EMA or one of

the procedures administered by competent authorities in E.U.

To obtain a marketing authorization to market a medicinal product in the EEA, an applicant must submit an MAA, either in accordance with a centralized procedure administered by the EMA or one of the procedures administered by competent authorities in E.U.

Member States (decentralized procedure, national procedure or mutual recognition procedure).

A marketing authorization may be granted only to an applicant established in the E.U.

The centralized procedure provides for the grant of a single MA by the European Commission that is valid in all E.U.

The centralized procedure provides for the grant of a single marketing authorization by the European Commission that is valid in all E.U.

Member States and through the EEA Member States – Norway, Iceland and Liechtenstein.

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Eligible products must target conditions for which there is an unmet medical need (there is no satisfactory method of diagnosis, prevention or treatment in the E.U.

or, if there is, the new medicinal product will bring a major therapeutic advantage) and they must demonstrate the potential to address the unmet medical need by introducing new methods of therapy or improving existing ones.

or, if there is, the new medicinal product will bring a major therapeutic advantage) and they must demonstrate the potential to address the unmet medical need by introducing new methods of

therapy or improving existing ones.

Benefits accrue to sponsors of product candidates with PRIME designation, including but not limited to, early and proactive regulatory dialogue with the EMA, frequent discussions on clinical trial designs and other development program elements, and potentially accelerated MAA assessment once a dossier has been submitted.

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Third party payors are increasingly challenging the prices charged for medical products and services and examining the medical necessity and cost effectiveness of medical products and services, in addition to their safety and efficacy.

Restrictions in coverage or decreases in third-party reimbursement for our products could have a material adverse effect on our sales, results of operations and financial condition.

Restrictions in coverage or decreases in third-party reimbursement for our products could have a material adverse effect

on our sales, results of operations and financial condition.

We expect that the pharmaceutical industry will experience pricing pressures due to the increasing influence of managed care (and related implementation of managed care strategies to control utilization), additional federal and state legislative and regulatory proposals to regulate pricing of drugs, limit coverage of drugs or reduce reimbursement for drugs, and public scrutiny of drug pricing.

There have been and likely will continue to be health care reform efforts.

For example, federal legislation enacted in 2021 eliminates a statutory cap on Medicaid drug rebate program rebates effective January 1, 2024.

For example, federal legislation enacted in 2021 eliminated a statutory cap on Medicaid drug rebate program rebates effective January 1, 2024.

As another example, the Inflation Reduction Act, or IRA, of 2022, contains various drug pricing and payment provisions.

Among other provisions, the IRA imposes a yearly cap ($2,000 in 2025) on out-of-pocket prescription drug prices in Medicare Parts B and D.

Among other provisions, the IRA imposes a yearly cap ($2,000 in 2025) on out-of-pocket prescription drug prices in Medicare Part D.

Additionally, the IRA, through a newly established Manufacturer Discount Program, eliminated, effective January 1, 2025, the size of the discount on brand-name drugs that pharmaceutical manufacturers are required to offer Medicare beneficiaries who are in the Medicare Part D coverage gap, or “donut hole,” by significantly lowering the beneficiary maximum out-of-pocket cost and requiring pharmaceutical manufacturers to provide a 10% discount in the initial coverage phase of the plan and 20% discount in the catastrophic coverage phase of the plan on brand-name drugs.

In addition, the IRA requires Medicare to negotiate Medicare prices for certain high-cost drugs and biologicals, including both physician-administered products covered under Medicare Part B benefit and self-administered drugs covered under the Medicare Part D benefit.

The Centers of Medicare & Medicaid Services, or CMS, annually selects a specified number of negotiation-eligible drugs from those drugs with the highest total Medicare Part B or D expenditures over a preceding 12-month period.

Eligible drugs generally include single source brand-name drugs or biological products that

have been on the market without therapeutically-equivalent generic or biosimilar alternatives for a specified number of years with certain exceptions (e.g., orphan drugs indicated for only one rare disease or condition and drugs with less than $200 million in annual Medicare expenditures).

The CMS annually selects a specified number of negotiation-eligible drugs from those drugs with the highest total Medicare Part B or D expenditures over a preceding 12-month period.

Eligible drugs generally include single source brand-name drugs or biological products that have been on the market without therapeutically-equivalent generic or biosimilar alternatives for a specified number of years with certain exceptions (e.g., orphan drugs indicated for only one rare disease or condition and drugs with less than $200 million in annual Medicare expenditures).

CMS will publish the negotiated price, known as the “Maximum Fair Price”, or MFP, for each of the selected products.

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Manufacturers who fail to negotiate or offer the MFP can face significant civil money penalties or excise tax liability on sales of that drug.

The first drugs were selected in 2023 and the MFP for those drugs will take effect in 2026.

Only Medicare Part D drugs are selected for the first two years of the program (i.e., MFPs that take effect in 2026 and 2027).

Depending on the share of Medicare spending each year that is attributed to LINZESS or any other product candidate that we develop and whether or not those drugs become eligible for Medicare negotiation, those drugs and our revenue may be adversely impacted by this provision.

In 2024, the HHS published the results of the first Medicare drug price negotiations for ten selected drugs that treat a range of conditions, including diabetes, chronic kidney disease, and rheumatoid arthritis, and the prices of the selected drugs will become effective on January 1, 2026.

On January 17, 2025, HHS announced the selection of 15 additional drugs, which included LINZESS, covered by Medicare Part D, for the second cycle of price negotiations.

The negotiated price for LINZESS will be effective starting January 1, 2027.

While we cannot predict what executive, legislative and regulatory proposals will be adopted or other actions will occur, such events could have a material adverse effect on our business, financial condition and profitability.

For additional information relating to pricing and reimbursement and legislative and other reform initiatives that may affect coverage, pricing and reimbursement, see Item 1A, Risk Factors , elsewhere in this Annual Report on Form 10-K.

Sales and Marketing

The marketing and sale of pharmaceutical products are subject to comprehensive governmental regulation both within and outside the U.S.

Within the U.S., numerous federal, state and local authorities have jurisdiction over, or enforce laws related to, such activities, including the U.S.

Drug Enforcement Agency, Centers for Medicare & Medicaid Services, the U.S.

Department of Health and Human Services Office of Inspector General, the U.S.

Department of Justice, state Attorneys General, state departments of health and state pharmacy boards.

We are subject to the requirements of the FDCA and accompanying regulations that prohibit pharmaceutical companies from promoting a drug prior to approval from the U.S.

FDA and from promoting an approved drug in a manner inconsistent with the approved label.

Healthcare Compliance

We are also subject to various federal and state laws pertaining to health care “fraud and abuse,” including anti-kickback laws and false claims laws, for activities related to sales of any of our products or product candidates that may in the future receive marketing approval.

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State laws may be more stringent, broader in scope or offer greater individual rights with respect to protected health information, or PHI, than the federal Health Insurance Portability and Accountability Act of 1996, as amended, and its implementing regulations, which are collectively referred to as HIPAA, and state laws may differ from each other, which may complicate compliance efforts.

Entities that are found to be in violation of HIPAA as the result of a breach of unsecured PHI, a complaint about privacy practices or an audit by the Department of Health and Human Services, or HHS, may be subject to significant civil, criminal and administrative fines and penalties and/or additional

reporting and oversight obligations if required to enter into a resolution agreement and corrective action plan with HHS to settle allegations of HIPAA non-compliance.

Entities that are found to be in violation of HIPAA as the result of a breach of unsecured PHI, a complaint about privacy practices or an audit by the HHS, may be subject to significant civil, criminal and administrative fines and penalties and/or additional reporting and oversight obligations if required to enter into a resolution agreement and corrective action plan with HHS to settle allegations of HIPAA non-compliance.

In addition to federal regulation, many states have begun to focus on efforts to regulate privacy and data security.

For example, in California the California Consumer Privacy Act, or CCPA, which went into effect on January 1, 2020 and was expanded by the California Consumer Privacy Rights Act, or CPRA, which went into effect on January 1, 2023, collectively establishes a privacy framework for covered businesses by creating an expanded definition of personal information, establishing new data privacy rights for consumers in the State of California, imposing special rules on the collection of consumer data from minors, and creating a new and potentially severe statutory damages framework for violations and for businesses that fail to implement reasonable security procedures and practices to prevent data breaches.

There also are states that are specifically regulating health information that may affect our business.

The California Confidentiality of Medical Information Act also applies to pharmaceutical companies, including requirements for written authorization to use and disclose medical information and restrictions on the circumstances under which medical information can be used for marketing purposes.

Other states that have also recently enacted comprehensive data privacy and security laws, include Washington, Utah, Virginia, Colorado, and Connecticut.

Furthermore, all fifty states, the District of Columbia, Puerto Rico, and U.S.

In addition, Washington state recently passed the My Health My Data Act, a health privacy law, which regulates the collection and sharing of health information, and provides a right of action for violation of the statute.

Other states have also recently enacted or are considering enacting comprehensive data privacy and security laws to which we may become subject, and all fifty states and U.S.

territories have enacted data breach notification laws.

These various state laws differ from one another and impose significant compliance efforts.

Achieving and sustaining compliance with applicable international, federal and state privacy, security, and data breach notification laws may prove time-consuming and costly.

EEA Member States, the United Kingdom, Switzerland and other jurisdictions have also adopted data protection laws and regulations, which impose significant compliance obligations.

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European data protection authorities may interpret the GDPR and national laws differently and impose additional requirements, which add to the complexity of processing personal data in or from the EEA, United Kingdom or Switzerland.

Guidance on implementation and compliance practices are often updated or otherwise revised.

Human Capital

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We consider our employee relations to be good.

Diversity, Equity and Inclusion (DE&I)

Creating a diverse, equitable, and inclusive culture is essential to attracting, motivating and retaining the talent necessary to deliver on our corporate mission.

In January 2025, following an analysis of our strategy and core business needs, and in an effort to streamline focus and support the continued development of our pipeline, we commenced a reduction in our workforce of approximately 50%, primarily consisting of field-based sales employees.

This reduction in workforce is expected to be substantially completed by the end of the first half of 2025.

Refer to Note 16, Workforce Reductions and Restructuring , to our consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K for further details.

Culture and Development

Fostering a welcoming and inclusive culture is essential to attracting, motivating and retaining the talent necessary to deliver on our corporate mission.

To establish and maintain this culture, we have a simple vision in mind:

to make Ironwood an environment rooted in valuing each employee for who they are.

This begins with ensuring our workforce represents the diverse populations we serve and reflecting our DE&I principles in our employee-related trainings and policies.

Our workforce represents the diverse populations we serve and reflects our diversity principles in our employee-related trainings and policies.

Women represent approximately 50% of our employee base, 30% of our leadership team (vice president and above) and 33% of our board of directors (including our board and audit committee chairs).

Additionally, approximately 20% of our employees are racially or ethnically diverse and in 2024, approximately 20% of our new hires were racially or ethnically diverse (excluding Europe-based employees, for which race and ethnicity is not disclosed).

We are focused on fostering an environment where employees feel included and empowered.

This approach includes DE&I initiatives such as learning and development opportunities, strengthened talent acquisition strategies, and the support of equality programs in our local communities.

We are also proud to have three strong and growing employee resource groups:

W@IRWD (Women at Ironwood), ISTAR (Ironwood Stands Together Against Racism), and PRIDE.

In 2023, we continued to advance our DE&I initiatives with strong advocacy from our leadership team and board of directors.

We incorporated DE&I metrics into our corporate goals.

Over the course of the year, we achieved our target level of performance on these metrics.

We seek to foster an environment where employees feel included and empowered.

This approach includes diversity initiatives such as learning and development opportunities, strengthened talent acquisition strategies, and the support of equality programs in our local communities.

We are also proud to have several strong and growing employee resource groups.

Compensation and Benefits

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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.

What changed 10-K

Item 1. Business