“We want to build a standalone, great pharmaceutical company. The ambition isn’t size, it’s quality and making drugs that really matter.” — Peter Hecht, 2009
About 99 times out of 100, when you ask biotech CEOs what they want to do with a startup, their response will boil down to: It depends. The venture backers may grab a lucrative early buyout offer. The IPO window may be opening or closing. Their lead drug could fail. A licensing deal could happen.
But Peter Hecht’s essential vision for Ironwood has never changed. Seven years after he told me in no uncertain terms what he wanted to achieve—a period which saw the approval of its drug Linzess (linaclotide), its IPO, an acquisition and more—he’s held on to the vision. And he’s still building.
“I’m amazed and pleased with where we’re at,” says Hecht. “But I’m not satisfied, either.”
Peter Hecht, CEO, Ironwood
Their irritable bowel syndrome drug has seen strong, though not Sovaldi-like, growth for Ironwood over the past three years. Ironwood and its partner Allergan recorded USD 454 million in US sales last year. To get there, the sales group has been spending around USD 250 million a year on sales and marketing.
But Ironwood is focused on growing the product portfolio along with product revenue.
There’s a lower, 72 mcg dose of Linzess that’s been pitched to the FDA. A second-gen colonic release product which could provide considerable pain relief is in a Phase IIb study that reads out later this year. Add it all together, and Ironwood sees peak sales from the franchise adding up to USD 2 billion in the US.
Developing that market gave Ironwood some practical experience at thinking how another drug focused on a familiar field could fit in. And when AstraZeneca shopped the gout drug lesinurad (sold as Zurampic) around after failing to get the kind of landmark data it was looking for, Hecht saw a unique opportunity.
AstraZeneca paid USD 1.26 billion to buy Ardea and get its hands on the drug. Ironwood grabbed it for a fraction of that; USD 100 million upfront and USD 165 million in milestones, along with royalties.
“We do think differently about Zurampic,” says Hecht.
At the time that AstraZeneca bought Ardea, he notes, the company was thinking of it as a blockbuster frontline contender. A set of three ambitious Phase III studies, though, disabused AstraZeneca of its hopes of blockbuster potential. And when AstraZeneca CEO Pascal Soriot isn’t happy with a drug—like lesinurad or, say, brodalumab — he looks for someone else to buy it so he can move on to new things.
Hecht says he couldn’t be happier to come in with the winning bid. It’s just a matter of redefining the economics and importance of the drug.
“We always thought of it as a second-line drug,” says the CEO. “We expect this drug to be at least a USD 300 million drug, with much more focused marketing; (costing about) USD 75 million the first year.”
Most gout sufferers can expect to start on allopurinol, an old generic, to lower their uric acid levels. It’s the group of patients who aren’t sufficiently helped who will get the combination of the two, and that’s where Hecht sees a clearly defined opportunity when he launches the drug in the second half.
Uncontrolled gout, he notes, “is a painful call to action.” And a small sales force focused on high prescribers should be able to tap its potential with a reasonable cost of sales.
On the R&D side of the company, you’ll also find sGC coming up the pipeline. Phase Ib data for Ironwood’s soluble guanylate cyclase (sGC) stimulators IW-1701 and IW-1973 are expected to arrive later in the year. And Ironwood will be looking for some positive signs that it’s on the right track for a whole different kind of drug franchise, with implications for blood flow, inflammation and fibrosis.
“That’s a platform were super jazzed about,” says Hecht. A success here would set up multiple Phase II studies.
Ironwood isn’t the first player to approach sGCs. Bayer got it started with an approval for Adempas (riociguat) in 2013. Adempas also underscored the hefty safety issues more recently when it quickly shut down a study for pulmonary hypertension associated with idiopathic interstitial pneumonias, or PH-IIP.
One of the big potential fields for this early-stage work lies in heart failure, a wildly expensive R&D arena usually dominated by the giants like Novartis (which has had its own ups and downs).
“We’re excited to see the science involved,” says Hecht, who won’t have any trouble covering early-stage research. “We will definitely need to partner for the rest of world.”
Whether Ironwood will need help to cover late-stage development in big areas like heart failure, where there’s acute interest in new products, Hecht will wait and see. But some of the initial partnering discussions indicate that there are some intriguing collaborations to pursue.
As part of this expansive partnering effort, Ironwood will be attending BioPharm America™ 2016 this September in Boston.
In the meantime, the CEO remains ready to do more deals like lesinurad, seizing on new products that can quickly start generating revenue with the commercial infrastructure already in place.
“Boy, we’d love to do another deal like lesinurad,” says Hecht, “but it’s hard to find.”
In the meantime, Ironwood is staying true to the fundamentals that got them to this stage.
“We’ve always been about innovating meds that could change peoples lives,” says Hecht.
Some things never change.
Meet innovative biotech companies like Ironwood at BioPharm America™ in September.