Ironwood sells the irritable bowel syndrome drug Linzess, which drew net sales in the U.S. of $701 million in 2017. The company splits proceeds from the drug with partner Allergan. It's also developing a pipeline of drugs for other maladies including gastroesophageal reflux disease (or GERD) and diabetic nephropathy.
Sarissa acquired a stake of 1.65 million shares in Ironwood in the fourth quarter of last year, according to the firm's most recent regulatory filing.
Denner declined to comment further about his plans if he joins Ironwood's board, but said he was surprised the company issued its announcement.
"I hope that we're going to continue to have a pleasant and constructive conversation, as I believe we were having," Denner said. "To the extent that they state in their press release that they're concerned with what investors want, I've been told that more value has been created for Ironwood shareholders today than in any single day in history."
Ironwood's market value is $2.4 billion after Monday's increase.
Wells Fargo analyst David Maris hailed Denner's interest in the board as positive, "given his track record for value creation with other firms." Maris also noted that Ironwood's shares have "underperformed for some time," despite an "earnest and capable" management team whose direction he said he likes.
Denner's interest will inevitably raise questions about the company's independence over time. At Sarissa and with Icahn, he's orchestrated sales of a number of his biotech investments, including, most recently, Bioverativ to Sanofi for $11.6 billion in November, and Ariad to Takeda for $5.2 billion in January 2017. He also sits on the board of Biogen and the Medicines Co., where he recently gained board control.
He's frequently advocated for smaller companies selling drugs in primary care settings to be partnered with or sold to larger companies. Of the Medicines Co., which is developing a drug for cholesterol, Denner said recently, "over time, I would say that it's best that the company either partner or be part of a larger pharmaceutical company."
He declined to comment further on what plans he may have for Ironwood.
Representatives for the company declined to comment beyond Monday's statement. The company said shareholders aren't required to take any actions now, and it hasn't yet announced the date of its annual shareholder meeting.