Ironwood Pharma (IRWD – Research Report), the Healthcare sector company, was revisited by a Wall Street analyst yesterday. Analyst Amy Li from Jefferies downgraded the rating on the stock to a Hold and gave it a $0.70 price target.
Amy Li’s rating is based on several key considerations surrounding Ironwood Pharma’s recent developments. The primary reason for the Hold rating is the need for an additional Phase 3 trial for Apraglutide, as requested by the FDA. This requirement stems from the lower-than-expected drug exposure observed in the initial Phase 3 trial, which the company attributes to the method of drug administration rather than the drug itself.
Furthermore, the FDA’s insistence on a confirmatory trial to validate efficacy and match previous exposure levels adds uncertainty to the timeline and potential success of the drug’s approval. Ironwood Pharma is also exploring strategic options, including partnerships and mergers, which introduces additional variables into the company’s future prospects. Given these factors, Amy Li has opted to downgrade the stock to a Hold, reflecting a cautious stance until more clarity is obtained on these issues.
According to TipRanks, Li is an analyst with an average return of -66.7% and a 0.00% success rate.
In another report released today, Wells Fargo also downgraded the stock to a Hold with a $1.00 price target.