Canada-based bone disease treatment developer Clementia Pharmaceuticals raised $120m yesterday in an initial public offering in the US that provided an exit for biopharmaceutical company UCB Pharma.
The company priced 8 million shares at $15.00 each, at the top of the IPO’s $13 to $15 range, and the underwriters have a 30-day option to buy another 1.2 million share which would boost the size of the offering to $138m.
Clementia plans to put $65m of the proceeds toward phase 3 clinical trials for its lead product candidate, a small-molecule therapeutic called Palovarotene that will combat fibrodysplasia ossificans progressiva by preventing abnormal bone or tissue formation, as it seeks registration for the drug.
A further $25m will support a phase 2/3 trial for Palovarotene in another bone disease, multiple osteochondroma, while $15m will fund phase 1 and 2 trials for the drug in dry eye disease patients.
The company had raised $92.5m in venture capital across two rounds, the second being a $60m series B in 2015 that was led by VC firm New Enterprise Associates (NEA) with participation from investors including UCB.
Rock Springs Capital Management, RA Capital Management, EcoR1 Capital, a fund advised by Janus Capital Management, OrbiMed Advisors and BDC Capital also backed the series B round, the latter two having previously provided $32.5m in series A funding for Clementia in early 2015.
UCB held a stake in Clementia sized at less than 5% pre-IPO. It largest investor is OrbiMed, whose share was diluted from 42.4% to 32.7% in the offering, while BDC Capital’s was cut from 22.7% to 17.5%, and NEA’s from 8% to 6.2%.
Morgan Stanley and Leerink Partners are book-running managers for the IPO while Wedbush Securities and BTIG are co-managers. Clementia’s stock opened at $18.25 on the Nasdaq Global Select Market yesterday, closing at $16.35.