NEW YORK (AP) -- Shares of Ironwood Pharmaceuticals Inc. rose Friday after a Wedbush analyst upgraded the stock, saying growth in prescriptions for the company's bowel drug Linzess has been better than he expected.
THE SPARK: Analyst Gregory Wade raised his rating on the stock to "Neutral" from "Underperform." Wade said the stock is not likely to trade higher over the next year, but he raised his sales target for Linzess. He is now projecting about $229 million in sales over the four quarters ending March 31, up from $152 million. Ironwood's partner Forest Laboratories Inc. expects about $170 million in sales of the drug over that time.
Wade maintained a price target of $12 per share.
THE BIG PICTURE: Linzess is a treatment for irritable bowel syndrome with constipation and for chronic constipation. It is Ironwood's only approved product. The Cambridge, Mass., company said May 14 that about 95,000 prescriptions for Linzess have been filled since the drug reached the market in December. That includes 50,000 prescriptions in the first quarter of 2013 and 40,000 more over the first five weeks of the second quarter.
Ironwood is running additional studies of Linzess to broaden its marketing approval and is also studying treatments for central nervous system disorders, gastrointestinal illnesses and allergic conditions.
SHARE ACTION: Ironwood stock rose 55 cents, or 4.2 percent, to $13.62 in afternoon trading. The shares reached an all-time high of $19.67 on March 18, but they have lost 27 percent of their value since the company reported its first-quarter results on April 22. Ironwood also conducted a stock offering earlier this month.