Last summer, Ironwood pink-slipped 40 staffers as it prepared to split itself into two companies. But it turns out those layoffs were only the beginning.
Wednesday, the drugmaker said it would ax 35 more employees, primarily in its home office in Cambridge, Massachusetts. The job cuts won’t touch the workers who have been tapped to go with R&D spinoff Cyclerion, nor will it affect its salesforce out in the field, Ironwood said.
When all is said and done, the company expects to rack up between $3 million and $4 million in charges related to the slimdown, which will leave it with a full-time roster of about 330 people after Cyclerion splits. Some 155 of those employees will call the Cambridge office home, while 175 will be out in the field.
Ironwood has had its strategy under the lens for the last year since activist hedge fund Sarissa Capital proposed divesting R&D. Ironwood went for the idea, which kept Sarissa from taking matters into its own hands, but cost 40 workers their jobs in the process.
More layoffs followed in August, when Ironwood decided to end its licensing agreement with AstraZeneca for gout drug Zurampic. At the time, Ironwood predicted the move would save it between $75 million and $100 million in 2019 expenses, though it put 125 employees—most of them field-based representatives—out of their jobs.
RELATED: Ironwood dumps AstraZeneca gout drug Zurampic—and lays off 125 in the process
As the company heads toward the big spinoff—slated for the first half of this year—Ironwood’s remaining staff is hoping this latest round of goodbyes will be its last. But in the meantime, the cuts are just one of the “important strategic actions” Ironwood says it’s taking toward pumping up growth of key GI drug Linzess, new CEO Mark Mallon said in a statement.
“We believe” the organizational changes “will help enable Ironwood to launch a more competitive and successful business,” he added.
