Through the transaction, Ipsen will acquire Clementia’s key late-stage clinical asset palovarotene, which is an investigational retinoic acid receptor gamma (RARγ) selective agonist.
Palovarotene is being developed for the treatment of fibrodysplasia ossificans progressiva (FOP), multiple osteochondromas (MO) and other diseases.
Ipsen CEO David Meek said: “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.”
Clementia is expected to file a new drug application (NDA) for palovarotene for episodic flare-up treatment of FOP with the US Food and Drug Administration (FDA) in the second half of this year. Based on FDA approval, the drug’s first commercial launch is anticipated to be achieved in mid-2020.
As per the agreement terms, Ipsen will make an upfront payment of $25.00 per share on completion of the transaction, which represents an initial aggregate consideration of $1.04bn.
Additionally, the French pharma company will make deferred payments on the achievement of a future regulatory milestone through a contingent value right (CVR) of $6.00 per share after FDA’s acceptance of the NDA filing for palovarotene for the treatment of MO.
The regulatory milestone-based payment would be worth up to $263m.
Currently, Clementia is engaged in a phase 3 trial of palovarotene for the treatment of FOP, a phase 2 trial for MO, and a phase 1 trial for dry eye disease.
Palovarotene was granted orphan drug designation for both FOP and MO by the FDA and the European Medicines Agency (EMA). The investigational drug also has fast track, breakthrough therapy and rare pediatric disease designations for FOP in the US.
The transaction, which is subject to shareholders’ and court approval, is expected to be closed in the in the second quarter of 2019.
Clementia CEO Clarissa Desjardins said: “Ipsen’s global commercial presence and capabilities will expedite our shared vision of bringing palovarotene to patients around the world as quickly as possible. We anticipate a smooth transition of our operations into the Ipsen organization that will continue Clementia’s vision of delivering palovarotene to patients worldwide.”