Appeasing activist investors, Ironwood cuts 40 staffers at the start of company split
Earlier this year, activist investors pressed on Ironwood to shape up, resulting in a plan to slice the company into two parts. Now, Ironwood is divvying up staff and trimming the excess, cutting 40 jobs along the way.
Under pressure from Alex Denner and his company Sarissa Capital, Ironwood said back in May that it would soon split into two companies: spinning out a pipeline of early- and mid-stage drugs into a separate, publicly traded biotech company while keeping its marketed products and related development projects in-house at a scaled down, and more profitable, mother company.
That process appears to be underway, as Ironwood filed an SEC form flagging a cut to its headcount. The company said it was laying off 40 employees, whittling its staff down to 630 total full-timers. The cuts will cost Ironwood $5 million to $5.5 million in severance payments and other one-time benefits costs, the company said.
Ironwood was mum on which departments took the brunt of the cuts but did note its in-field sales staff was excluded from the trimming process.