Good day, ladies and gentlemen, and welcome to the Ironwood Pharmaceuticals fourth quarter 2012 investor update conference call. At this time, all participants are in a listen-only mode. Later we will conduct a question-and-answer session and instructions will be given at that time. (Operator Instructions) As a reminder, today’s conference call is being recorded. I’d now like to turn the conference over to your host, Ms. Meredith Kaya, Associate Director, Investor Relations. Please go ahead.

Good morning and thank you for joining us for our fourth quarter 2012 investor update. Joining me for today’s call are Peter Hecht, our Chief Executive Officer, and Tom McCourt, our Chief Commercial Officer. We also have Michael Higgins, our Chief Operating Officer, Mark Currie, our Chief Scientific Officer and Jim DeTore, our Vice President of Finance, available for the question-and-answer portion of the call. By now, you should have a copy of our press release which crossed the wire earlier this morning. If you need a copy of the press release, you can go to our website, www.ironwoodpharma.com, to find an electronic copy. Some of the information discussed in today’s call is based on information as of today, Tuesday, January 15, 2013, and contains forward-looking statements that involve risks and uncertainties. Actual results may differ materially from those set fort in such statements. We do not undertake any obligation to update any forward-looking statements made during this call or continuing a company (inaudible) as a result of new information, future events or otherwise. For a discussion of these risks and uncertainties, you should review the forward-looking statements disclosure in our press release and on the current slide with the heading Safe Harbor Statement as well as the risks under heading Risk Factors and our quarterly report on Form 10-Q for quarter ended September 30, 2012 and any of our future SEC filings. I would now like to turn the call over to Peter.

Thank you, Meredith, and many thanks to everyone on the call for joining us this morning. The past several months have been an important period of time for us here at Ironwood as we achieved several critical milestones and transitioned into a discovery, development and commercial organization. Before we get into the core of today’s call, I want to take a moment to acknowledge and thank all of the people who have been critical in getting us to this rare inflexion and whom we hope will continue to play an integral role in our future. First, I want to thank our employee-owners who bring tremendous passion, enthusiasm and dedication to our shop every day. We’ve really grown as a company this past year, both in number of employees as well as in capabilities, knowledge and talent. The most striking addition has bee the experience in highly skilled sales force that is now out educating physicians about LINZESS in close collaboration with our Forest sales colleagues. I have the great pleasure of actively participating in the sales training sessions over the past few months and I’m continually impressed by the capabilities this team brings to LINZESS and to our collaboration with Forest and also by how quickly they have become part of the fabric of our team and strengthened our culture. In addition to our sales capability, we added many other wonderful and talented teammates who have pioneered a whole – pioneered a number of whole new functional capabilities. I also want to thank our other owners, many of whom have been with us since our founding back in 1998 and continue to support our group and development. Our board members, themselves all substantial shareholders, who have provided strategic guidance and expertise as we navigate this transition into becoming a commercial…

Thanks, Peter. As we introduced LINZESS to the US-adult IBS-C and chronic constipation communities with our commercial partner Forest, we continue to ground ourselves on the objective that every adult patient with IBS and chronic constipation who can benefit from LINZESS will have access to it. We are please so far with our execution and launch and are very encouraged by the feedback our sales force is getting from physicians, but we only into the launch in a few weeks and we still have a lot of work to do. As we shared with you before, we feel that it’s critical to concentrate our efforts on a few key areas that will drive the growth of LINZESS over time, first, we must work with physicians so they recognize the full value of LINZESS. Second, we must engage appropriate patients who can immediately benefit from LINZESS. And third, we must work to secure access and affordable co-pays for the millions of adult IBS-C and CIC patients. First, beginning with physicians, as I mentioned earlier, we have seen encouraged success with our sales professionals and the progress they’re making in communicating the benefits of LINZESS to both gastroenterologists and primary care physicians. Together with our partner Forest, we have over 1400 sales specialists who are now educating over 80,000 physicians about LINZESS. What we’re hearing from them based on a form feedback is that in getting extended time with these physicians and, more importantly, engaging in robust discussion about the patients in need and the evidence that finding the clinical profile of LINZESS. To enable physicians to critically evaluate LINZESS, we have mobilized an early experience program and are in the process of distributing approximately 300,000 early release kits to the (inaudible) 30,0000 gastroenterologists and primary care physicians. The early experience kits…

(Operator Instructions) Your first question comes from the line of (Mario Coriso) – (Mizua USA).

Maybe just in terms of the launch, can you talk a little bit about the $250 million to $300 million in expenses for 2013. So is that a combined number that we’re going to see in the joint venture type P&L. I guess I’m trying to figure out how we should best think about that number and how it relates to Ironwood’s P&L and the company’s own SG&A line. And then secondarily, I’m wondering the best way to think about any kind of European revenue contribution for this year as well.

Let me take the $250 million to $300 million first and what we attempted to do there is to clarify for you guys the broad investment specifically in LINZESS for sales and marketing. So that the – the way we discussed it with folks in the past is we’ve given you basically parameters for the sales investment, parameters for the non-sales commercial investment and we simply wanted to clarify for folks but you’re right in your interpretation. That’s the combined investment, the total investment for LINZESS that will be made by Ironwood employees together. We are responsible for half of that and it will show up -- depending on the utilization of our different assets, it’ll show up over the course of the year and different line items. So for instance, our sales – it’ll incorporate in our sales line and our marketing – sales and marketing line and then there will be some collaboration expensive components of that. But I think the most important thing to recognize is that we are accountable for half of that and we wanted to give you a range based upon other predicates in the space for this type of investment. We just wanted people to understand it a little more – in a little more granularity. Does that make sense? Let me pause there. Unidentified Analyst: Yes.

If I can editorialize just for a second, (Mario), I think partly what we’re trying to do here – over the past maybe five or six quarters we’ve taken the time to educate on the various components of primary care launches because some folks haven’t seen a primary care launch like this in a while. We thought it was useful during that period of time to break out the various components, both to remind people of all the pieces that go into a primary care launch and to describe the individual investment elements that are required to execute on it. And at this point, we’re really just aggregating those various components of the investment into a single number to simplify for folks. I think at this point, folks who have been following our story understand all these pieces in pretty gory detail, so we thought it would be helpful to simplify. It’s more that than anything else.

And, (Mario), the second part of your question again, if you can repeat it. Is there another element or you’re good?

European contribution in 2013.

Yes, I think it’s pretty much – I think our expectations from Europe for this year are we’re going to keep them on a conservative side. The launch – we do expect initial launches to happen for – I’m sorry, (inaudible) has not given the specific breakout in timing of those but we do expect launches on a territory-by-territory basis to start happening this year and obviously those – there are milestones associated with that. And most importantly, from a long-term perspective, we’ll start to see some of our royalties coming in from there. But we would expect that that’s going to roll out over the course of the year and it’ll be a – we’re in it for the long-term in Europe but we expect that to star this year but no specific guidance on how that exact timing and magnitude of impact this year.

Your next question comes from the line of Geoff Meacham – JPMorgan.

Just a quick question on reimbursement, can you expand a little bit on what goes on in the negotiation process as you’re trying to move from tier three to tier two and how long generally speaking that takes to sort of make that move?

Yes, I think there’s obviously the core is really laying out the value proposition for the payer based on the clinical profile and the price and certainly we feel very good about the clinical profile of LINZESS based on what we’ve got on the label and the overall proponents of the drug. And I think we priced the drug initially to really maximize the value proposition. Certainly as we go forward in the evaluation process with the payer, obviously there will be ongoing discussions on what the net price will look like, which we haven’t given any specific guidance on overall. But I think we – and we would expect there’s going to be a group that will come out over the first three months making a decision. There will be another wave probably at six months and then the last groups will generally make a decision within the first 12 months. And certainly it’s our goal to get the majority of patients into tier two before the end of the year with either limited or no restriction. Does that help?

Yes.

I think the other comment I’d make is we’ve had some really positive initial conversations with a couple of the big pairs and I think we’re going to hear something here quite quickly, so we’re extremely encouraged.

Your next question comes from the line of Irina Rivkind – Cantor Fitzgerald. Irina Rivkind – Cantor Fitzgerald: Following up on the coverage questions, can you tell us what percent of LINZESS patients are covered by Medicare, Medicaid and are these patients eligible to participate in your co-pay buy-down program?

I think they are not eligible. First of all, no Medical, Medicaid patient would be eligible for the co-pay buy-down. As far as what we currently estimate, our Medicare, Medicaid, we haven’t given a lot of guidance but I think we’ve consistently said that it’s probably 20% or less based on what we’ve seen with other analogs including (Zelmore) and (Latiza). Irina Rivkind – Cantor Fitzgerald: And then just the second question is Forest reported $19.2 million in LINZESS sales and I just wanted to understand how much of that was stocking and also if you would expect sales to take a dip slightly in the next quarter as wholesalers work down the inventory and also if that $25 million guidance Forest provided earlier is still realistic or are you expecting to do better.

I guess I’d refer you bad to Forest specifically for comments about the guidance that they’ve provided for what will be the remaining portion of their fiscal year. But I comment, again, we don’t provide the additional granularity. I think you heard in Tom’s comments we’re enthusiastic about the initial launch but you know that the accounting methodology for Forest is that they score revenue on an X factor basis, so, yes, there is stocking in that number but we haven’t broken out the details below that. And, again, I’d refer you back to Forest on the details for the accounting practices there but it is on an X factor basis, so absolutely, there is stocking in there.

Your next question comes from the line of Matthew Harrison – UBS. Matthew Harrison – UBS: Two things, first, you helped us out thinking about sales and marketing in 2013 for the collaboration. Anything you can do to help us think about either directionality or order of magnitude of R&D spend, the collaboration? And then secondly, how should we interpret RX trends over the first few months of the launch given how heavily that you’re sampling?

On the R&D spend, Matthew, at this stage, we do expect to continue and invest both in our pipeline as well as in the continued investment in Linaclotide globally and specifically LINZESS in the US. But at this moment, particularly with LINZESS in the US, the team is working out the specifics of the lifecycle management plan, so we don’t have exact guidance on that but we do – you should anticipate we’re going to continue to invest in furthering the opportunity for LINZESS, so yes, we will continue to invest in that area but we don’t have any specific guidance at this time. The team is working through the plans. With regard to pipeline spend, we’ve talked about that in the past and we do expect to continue to invest in the pipeline at a level similar to what we’ve done in the past. We’ll be talking about progress in the pipeline late this year and give you a little more detail on that but we do expect to continue that investment. I guess I’ll cover all of that by saying we also – you should be aware that as we’re talking about, whether it’s R&D or the other expenditures, we – obviously the way we run the business is to invest on the basis of the opportunity and we’ll be constantly evaluating on how the progress is moving forward with LINZESS in the US and Constella in Europe and making determinations about the magnitude of our investments. But at this stage, we’re pretty comfortable with that sales and marketing number and as we get (inaudible) more granularity from you guys, we’ll provide a little more guidance for you in the future, or guidelines in the future. But at this stage, that’s all we’re comfortable with.

On the following scripts, we’ve been trying to encourage folks for some time that for a launch like this you’re really not going to get a good read for at least six to nine months and that’s for a number of reasons. And as you heard from Tom this morning, we have 300,000 30-day account early experience kits that have gone out through our sales force to 30,000 physicians and that is going to have a big impact on early script trends. Also, we’re sampling with four account samples to now the 85,000 physicians we’re calling on together with Forest. So to back up just one step, if you think about the profile of our drug and believe that the clinical trial data that we developed during the development phase reflects the attributes of the product, we have a drug that we think offers rapid and sustained benefit on really bothersome symptoms to millions of people. And as long as they continue to take the drug, they see the continued benefit in their symptoms and when they stop their symptoms come back. And with a product with a profile like that, we’ve tried to do everything we can with respect to the early days of the launch to maximize the opportunity for patients and physicians to experience the drug and to minimize any barriers. So whether that’s with respect to these early experience kits or with respect to the way we have priced the drug or this early electronic co-pay system, we’re trying to make it as easy as possible for patients and physicians to assess the benefit that they might receive from the drug. And with all that in mind, some of the early work that we’re doing is going to mask, I think, the ability to see how many patients are using and benefiting from the drug until maybe that six to nine-month window. The other key element – and Tom’s been educating on this for some time – is going to have to do with how well and effectively Linaclotide and LINZESS transitions, what’s been an episodic market, to a chronic benefit for patients. And in order to see that, you’ve really got to see refills and patients coming back to stay on their drug and that’s really going to be out in probably the nine to 12-month window. I think that’s a really important variable to watch and one we won’t be able to get a good read on early.

And just maybe as a quick follow up, can you maybe compare the sampling that you are doing versus what, say, was done with (Zelmar)?

It’s reasonably comparable. We’re quite a bit heavier on the early experience kits primarily because we’re launching into two indications where (Zelmar), the only (inaudible) IBS-C and women only with IBS-C (inaudible). But we’re launching into a much bigger market than (Zelmar) did, so we felt that this level of early experience kits as well as sampling was appropriate. Does that help?

Yes.

Your next question comes from the line of Dave Friedman – Morgan Stanley. Dave Friedman – Morgan Stanley: Just two quick ones – one is can you maybe just discuss the – your gross to net assumptions and the type of rebating you’re needing to do and how that will evolve over time? And then the second question is just for – if you can maybe just broadly for a launch and marketing of this type of drug over time, would you expect over time to keep incrementally adding reps and incrementally increasing marketing spend or is this something where as the drug becomes more mature you wouldn’t necessarily need to be investing at the same level or a higher level?

So on a gross to net, we haven’t provided granular detail on it but what we have said is that typical in this space you’d see a range in the 15% to 20% as your estimate for a gross to net reduction. So I think our view is until we get a little more color on how things play out, it’s hard to get any more defined on that. But based upon what you were seeing with other products, that range is something that we think is reasonable proxy for the moment.

As far as the marketing spend and the marketing mix, this is something that we constantly discuss with Forest and we’re collaborating with basically align on how we’re going to inform those decisions moving forward. The good news here is we can make really good database decisions with regard to the promotional response to this on the physician side but also it’s more (toward) responsiveness on the patient side. So I think if it certainly looks like the investment is paying off and/or it makes sense to invest more, we’ll do that. If it makes sense to reallocate or adjust that investment based on the data that we have in front of us, it will certainly be responsible with the investments wanting to make the right decision.

Your next question comes from the line of Juan Sanchez – Ladenburg. Juan Sanchez – Ladenburg: A couple of questions on what are the – you said that most of the patients go to tier three. What are the (inaudible) in the few payers that have this insurance? Second question is once most of the patients are in tier two and the co-payment assistance program is going to be in place or will you remove the program completely?

So Juan, I didn’t quite understand your first question. I got the second one.

You said just the minority of payers have no restrictions for the drug and what are the restrictions you’re seeing?

Sure, there’s been a few plans where we’ve seen some step edits, which require a failure on a laxative. It’s basically primarily a ‘check the box’ exercise, I mean it’s really the only restriction we’ve seen thus far. And of course, just to remind everybody that the – virtually all these patients who have walked into the physician’s office have already tried and failed laxatives, and are certainly not satisfied with the responsive they have gotten, so that doesn’t seem to be a big burden as far as walking through, but certainly we want as clean a decision as we can. And with regard to the automated co-pay assistance program, that – again, that just – basically the way this works is you set a co-pay and basically you cover the difference between what the initial co-pay was at at Tier 3 for $35. So, as we continue the process of contracting and working with the payers to bring that co-pay down to Tier 2 levels, it only covers the spread. So eventually we see that as we work closer and closer with payers, we see this program likely going away over time.

One last question on – a clinical question, actually on the dyspepsia program. All the secondary efficacy endpoints that you are doing, you are measuring the Phase II, are those likely to stay on a potential Phase III or the indication is still quite immature and you need to do a bunch of work for the validation of the endpoints in the future?

Yes, so it’s an early proof of concept study and at this point it’s more exploratory endpoint looking at a number of the different symptoms that these patients suffer from. As you’re aware, they suffer from early satiety, nausea, upper abdominal pain, fullness, bloating. All those types of symptoms we’re exploring and trying to understand better what effect GC-C agonist, in this case, 9179, that’s in the proof of concept, would have on those symptoms.

Your next question comes from the line of Rachel McMinn – Bank of America. Rachel McMinn – Bank of America: I just wanted to follow up on the expense guidance, the $250 million to $300 million. Thanks for giving that, but I guess the question is, as you think about beyond 2013, is that a high watermark where you would expect launch expenses to decline over time, or is that something that is steady or you build a base from?

Tom commented a little bit on the general trends, but let me comment it this way. So we think that this is the appropriate number for launch here. We think we’ve got the right team in place from a sales perspective and the kind of the investments that we anticipate on the non-sales commercial expenditure. We feel it’s right for the launch here. The mix of those two that we’ll see going forward I think really will be determined by the joint team in terms of – as they analyze the data and determine whether or not we are having an effect in one versus the other. But I think as a place holder as we go forward, we do anticipate this as a significant launch and we do expect that we’re going to have to make significant investments on an ongoing basis. So I think it’s a reasonable proxy going forward but I think it’s a mix that we will be providing a little more education on as we go forward. I think we’ll be learning ourselves, as Tom alluded to earlier. So we’re going to watch it. We’re going to make sure we make the right types of investments., but I think it’s a good range to use on a go-forward basis as well, and we’ll adjust that obviously as the business dictates, but given our assumptions today, we feel it’s a reasonable assumption on a go-forward basis as well. Rachel McMinn – Bank of America: And then have you said on sampling how long is typical for that type of – the type of sampling that you’re doing? Is it a six month program, something that would last the entire year or something you’d pull back over the course of the year?

Tom, can you address that both on the early experience kits and on the ongoing four-count sampling?

So as far as the early experience kits, , we certainly see this as a bolus to get a real robust meaningful assessment for physicians and patients on the performance of the drug. So, we see the early experience kits coming in and coming out fairly quickly. As far as ongoing sampling, I think what we do know is the number one driver for certainly physician behavior as well as patient acceptance is the observation that people that are actively responding to the drug and, certainly every new patient -- many of those patients get started on samples. And certainly when you look at other highly successful, highly symptomatic launch analogs, , the sampling strategy is core for the overall strategy of the drug. So, we certainly see ourselves sampling significantly over time as the drug becomes more and more successful.

Rachel, if I can add just one quick comment – it’s Peter – with respect to primary care launches in general, I think we all know that primary care launches haven’t been particularly great over the last five or six years by and large and there is this sort of not untypical $250 million to $350 million investment in most primary care launches. What I think people sometimes forget is that’s about the amount of ongoing expense for a primary care product, whether it’s a $400 million product or a $12 billion product. So the kind of leverage that primary care products can get when they’re drugs like Lipitor or Advair or Nexium or Prilosec can be pretty terrific when you really help millions of patients.

Your next question comes from the line of Greg Wade - Wedbush. Greg Wade – Wedbush: Tom, with respect to your sales force’s access to physicians, how are you tracking effective metrics? At the new era in terms of a sales person’s access to face time with a doctor, I was wondering if you could give us some sense of the percentage of success with both the PCP and specialist sales force or specialists? And then with respect to the early access sample, is there some methodology by which you’re capturing the inventory and the sample cabinet for the EAPs?

With regard to, I guess the performance, obviously we’ll be tracking calls for obviously physician prescribing, which is obviously the obvious promotional response of the promotional effort versus productivity of the prescriber, which I think is certainly the traditional way in which it’s looked at. We are going to be looking at some additional things, as well, as we’re better educated on how well they respond over time. And certainly the physician level audit data is far more precise than what we had in the past, so I think we can get pretty -- we think we can get a pretty good idea pretty quickly as far as how well the physician is responding to the educational effort, the sampling effort, the educational efforts that we’re providing to them. As far as– Greg, the second question, could you repeat?

Yes, so just with respect to the first, are your – is there an established success threshold in terms of actually getting face time with the physician that you’re targeting in those two environments? It is difficult for sales people in this era to get in front of the doctor in the office, so I’m curious as to whether – what you think is going to happen and what you’re actually seeing in terms of that performance. And then the second question is with respect to the early experience kits. Is there a formal way in which the inventory of those is being captured on a say, weekly basis within the sample cabinet where they’re being deposited?

Yes, we’ll take the second one first and let’s come back to the first question. As far as monitoring the inventory, there’s really – it’s very difficult to do, as you know, to keep track of what’s coming and what’s going because generally we’d tell you what’s being put in there and obviously the physicians, the representatives are trying to get into the samples closet to really audit what is the level of inventory in the office. But obviously that varies from office to office. So we’re going to try to minimize that inventory as much as possible but, again, it really depends on can we get access to actually visibly evaluate and observe what that level then (inaudible) looks like. As far as access to the physician, which is a great question, and this is one of the real powering strengths that we’ve seen in the past with Forest with regard to their ability to access primary care physicians in a very, very effective way. So I think we’ve obviously been leaning on their support of primary care. What we’re seeing from our sales force thus far is (very) – they’re being accepted extremely well. We’ve seen very few turn aways, particularly in the GI community. The GI community is extremely interested in LINZESS. As I mentioned earlier, we’re engaging in lengthy discussions. We’ve already had follow up requests for samples and early experience kits. So and then we also have (Nexium) which will be another value driver for time with the physician. We think it’ll even additionally broaden our access, not only with gastroenterologists but primary care physicians. So I think everybody’s challenged with this – with the difficulty of being busy PCP and GI physicians but thus far it looks very, very encouraging and as long as we continue to bring value in terms of education and certainly samples and other resources, hopefully we can maintain that level of access with the healthcare professional.

And with no further questions at this time, I would like to turn the conference back over to management for any closing remarks.

Thank you, (Ellie), for your help this morning and thanks to all of you for joining us to discuss fourth quarter and recent highlights. We’ll be around here the rest of the day if you have additional questions. You can reach us through Meredith and that should be available on the press release. Thanks again for joining us. We appreciate it.

Ladies and gentlemen, this does conclude today’s conference. You may all disconnect and have a wonderful day.