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Ironwood Pharmaceuticals, Inc. Message Board

  • big_pharma_coming big_pharma_coming Aug 31, 2012 9:03 AM Flag

    Morgan Stanley out this am "Approval A Positive; Focus Now Turns to Launch" Reiterate Overweight on IRWD


    Ironwood Pharmaceuticals, Inc.

    Approval A Positive; Focus Now Turns to Launch

    Impact on our views: Approval of Linzess with a
    relatively clean, broad label is a clear positive for
    Ironwood and we continue to believe Linzess is a best in
    disease therapy with $2bn WW sales potential. While
    there remains some outstanding question among
    investors as to the a) launch trajectory for Linzess, b)
    peak potential of Linzess, and c) cost to adequately
    market this drug, we believe generating a strong launch
    trajectory through 1H13 should help resolve some of
    these key concerns. Additional thoughts are below.

    Approval: The approval with a black box does not
    concern us, as we have always viewed this mkt (and
    constructed our mkt model) as an adult mkt. In addition,
    we do not find the approval of two different doses as a
    concern given the distinct addressable populations.

    Pricing: The company’s comments about pricing are
    specifically encouraging to us, as we believe fair pricing
    and broad, “hassle-free” market access will be critical to
    the launch trajectory and peak potential. Pricing parity
    between the low (chronic constipation) and high (irritable
    bowel syndrome, IBS) doses will a) help avoid any
    incentive to try to push IBS pts to a lower than
    appropriate dose, b) could reduce chronic constipation
    dropouts as pts may see less barrier to using the higher
    dose off label, and c) allow the value per pt to be more
    predictable. The company has stated that they plan to
    price the drug to maximize market access and are using
    currently marketed drugs as a guide. While we believe
    this is a premium product to available therapies for IBS
    and chronic constipation, we do not think premium
    pricing would be optimal in an increasingly cost sensitive
    (both payors and pts) US drug market.

    What's new: Linaclotide (brand name Linzess)
    received FDA approval in both chronic constipation and
    irritable bowel syndrome

    Sentiment: Strong Buy

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