Ipsen Pays $1.3 Billion for Clementia
French drugmaker Ipsen has agreed to buy Canada’s Clementia Pharmaceuticals, boosting its rare disease portfolio. Ipsen will pay $1.04 billion for the clinical-stage biotechnology company plus deferred payments worth another $263 million on achieving future regulatory milestones.
The acquisition will give Ipsen access to Clementia’s key late-stage clinical asset palovarotene, an investigational retinoic acid receptor gamma (RARγ) selective agonist for treating fibrodysplasia ossificans progressive (FOP), multiple osteochondromas (MO) and other diseases.
FOP is an extremely rare disease that causes fibrous tissues such as muscles and tendons to turn to bone. MO is another rare bone disease where patients develop multiple benign tumors.
The company entered into an exclusive licensing agreement with Roche in January 2014 for the global rights to palovarotene.
“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,” said Ipsen CEO David Meek.
“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 US approval in 2020 and additional indications to follow,” Meek said.
Clementia is currently carrying out a Phase 3 trial of palovarotene for FOP, a Phase 2 trial for MO and a Phase 1 trial for dry eye disease.
The US Food and Drug Administration (FDA) and the European Medicines Agency (EMA) have granted orphan drug designation for palovarotene for both FOP and MO. The FDA has also given the investigative treatment fast-track, breakthrough therapy and rare pediatric disease designations for FOP.
Clementia expects to file a new drug application for palovarotene with the FDA for episodic flare-up treatment of FOP in the second half of 2019.
Subject to FDA approval, the company expects to do a first commercial launch of the drug in mid-2020.
Ipsen estimates that palovarotene could have peak sales of $400 million in chronic and episodic FOP uses.
Both companies’ boards of directors have approved the deal, which is anticipated to close in the second quarter of 2019, subject to the usual conditions. The transaction will proceed as a “plan of arrangement” under Canadian corporate law, and will require approval from at least two-thirds of Clementia’s shareholders at a special meeting to be held on or about Apr. 9.
Based in Montreal, Clementia was founded by CEO Clarissa Desjardins in 2010. The company issued an initial public offering on Nasdaq in August 2017, raising about $174 million.
Analysts at SVB Leerink said the deal looked like a “clear win” for shareholders. French broker and investment bank Midcap Partners viewed the acquisition positively as it would strengthen Ipsen’s product pipeline from 2021 onward.
The transaction is the latest in a spate of deals as major drugmakers buy up smaller companies with potentially lucrative therapies. On the same day as Ipsen’s announcement, Roche said it would pay $4.3 billion for Spark Therapeutics.
In early 2019, US drugmaker Eli Lilly said it was acquiring Loxo Oncology and Bristol-Myers Squibb (BMS) is trying to merge with US biotech Celgene. However, the latter is running into trouble with two groups of major shareholders – Starboard Value and Wellington Management – fighting to block the deal.