Clementia Pharmaceuticals Inc. (NASDAQ: CMTA) shares shot up on Monday after the firm announced that it will be acquired. The firm has entered into an agreement to be acquired by French pharmaceutical company Ipsen.
Notably, this includes Clementia’s key late-stage clinical asset palovarotene, an investigational retinoic acid receptor gamma selective agonist, for the treatment of fibrodysplasia ossificans progressiva (FOP), multiple osteochondromas (MO) and other diseases. The acquisition will proceed by way of a court-approved plan of arrangement pursuant to the Canada Business Corporations Act.
Some quick background: Palovarotene inhibits excess bone morphogenetic protein signaling, which is linked to the progression of FOP and MO, two well-characterized, ultra-rare/rare and severely-disabling bone disorders for which there are currently no treatment options available.
A New Drug Application (NDA) for palovarotene for episodic flare-up treatment of FOP is expected to be submitted to the U.S. Food and Drug Administration (FDA) in the second half of 2019.
Also, a first commercial launch is expected in mid-2020. A Phase 3 registrational trial evaluating a chronic dosing regimen for FOP, a Phase 2 trial for MO and a Phase 1 trial for dry eye disease are also ongoing.
David Meek, CEO of Ipsen, commented:
The acquisition of Clementia Pharmaceuticals accelerates the ongoing transformation of Ipsen as we are successfully executing on our external innovation strategy to identify and acquire innovative medicines to serve patients with unmet medical needs. Through this transaction, we will gain scientific expertise, exceptional talent, and a cornerstone ultra-rare disease drug candidate with rare pediatric disease and breakthrough therapy designations, potential U.S. approval in 2020 and additional indications to follow. We look forward to working closely with Clementia to successfully integrate two companies that share a similar patient-centric culture and the ambition to deliver new treatments to patients with unmet medical needs.
Shares of Clementia traded early Monday at $26.10, or up more than 74%, with a 52-week range of $8.10 to $19.58. The stock has a consensus analyst price target of $27.33. Following the announcement, the stock is up about 75% at $26.20, in early trading indications Monday.