Wells downgrades Ironwood to Equal Weight on ‘major setback’

Wells Fargo downgraded Ironwood (IRWD) to Equal Weight from Overweight with a price target of $1, down from $7. The FDA’s request for a new trial delays a key near-term growth driver for the shares and puts additional financial pressure on the company, which already carries a high debt load, the analyst tells investors in a research note. Wells views the FDA’s request for a confirmatory trial of apraglutide in short bowel syndrome with intestinal failure as a “major setback” for apraglutide. Wells says Ironwood lacks additional growth drivers and faces a looking liquidity risk.