Clementia Pharmaceuticals Inc. completed a $60 million mezzanine financing round to support continued development of its lead compound, palovarotene (formerly Clm-001), to treat fibrodysplasia ossificans progressiva (FOP). The rare, disabling disease is caused by a point mutation in the ALK2/BMP type I receptor that causes overactivity of the receptor, prompting painful, recurrent episodes of soft tissue swelling and abnormal bone formation in muscles, tendons and ligaments, progressively restricting movement. Flare-ups begin early in life and may occur spontaneously or after soft tissue trauma, vaccinations or influenza infections. The indication, thought to affect fewer than one in 1 million people, has no approved therapies.

A retinoic acid receptor gamma (RARγ) agonist, palovarotene was in-licensed from Roche Pharmaceuticals, a unit of Roche AG, of Basel, Switzerland, which spent more than a decade advancing the drug in emphysema and chronic obstructive pulmonary disease (COPD). Roche took the drug through phase II trials that enrolled more than 800 individuals, including healthy volunteers and COPD patients. U.S. and EU filings were expected by 2012, according to Cortellis Clinical Trials Intelligence (CTI), but in 2011, Roche quietly removed palovarotene from its pipeline and began efforts to out-license the drug.

In the meantime, Maurizio Pacifici and Masahiro Iwamoto, professors at Children's Hospital of Philadelphia, reported in Nature Medicine that RARγ agonists could prevent heterotopic bone formation in animal models of FOP, citing the use of palovarotene. When Clarissa Desjardins, Clementia's CEO, contacted Roche, she learned they were preparing to out-license the drug.

Before founding Clementia in 2011 with Jean-Claude Tardif, Canada research chair in translational and personalized medicine and director of the research center at the Montreal Heart Institute, Desjardins had launched Advanced Bioconcept Ltd., later sold to Perkin Elmer division NEN Life Sciences (Perkin Elmer), and had co-founded Caprion Pharmaceuticals Inc., which merged in 2007 with Ecopia Biosciences Inc. (See BioWorld Today, Jan. 5, 2007.)

Desjardins then served as CEO at Canada's Centre d'excellence en médecine personnalisée, or CEPMED, a federally and privately funded nonprofit created to promote personalized medicine through education, policy and public-private research partnerships.

"Our goal was to fund the clinical trials in FOP and to build a sustainable company," Desjardins told BioWorld Today.

Montreal-based Clementia – the Latin word for compassion or empathy – struck a deal with Roche and in April 2013 raised a $22.5 million series A financing led by Orbimed Advisors with participation by existing investor BDC Capital Healthcare Venture Fund. The investors added another $10 million to the round in October 2014.

Both investors also participated in the mezzanine financing, which was led by New Enterprise Associates and included newcomers UCB SA, RA Capital Management, Rock Springs Capital Management, EcoR1 Capital and an undisclosed fund advised by Janus Capital Management LLC.

SUCCESS IN PHASE II COULD LEAD TO 'UNLIMITED OPTIONALITY'

Clementia has moved palovarotene into a phase II program in FOP, which includes a randomized, double-blind, placebo-controlled efficacy and safety study targeting flare-ups in FOP patients and an open-label extension study as well as a natural history study of FOP. All three trials continue to recruit patients, according to Cortellis CTI, with the safety and efficacy study expected to be fully enrolled by year-end.

The primary endpoint is percentage of responders at day 42, as assessed by plain radiographs. Secondary endpoints include plasma biomarker levels, presence of soft tissue swelling and/or cartilage as assessed by MRI, use of assistive devices and adaptations for daily living and other subject-reported assessment of physical function, active range of motion, duration of active flare-up and pain and swelling at flare-up site – all assessed at baseline and periodically during the course of the study.

That study is enrolling two cohorts at sites in the U.S. and France, randomized into three dosing regimens of palovarotene for a six-week (42 days) treatment period and another six-week follow-up. An initial cohort of eight patients was randomly assigned in a 3-to-1 ratio either to palovarotene or placebo daily for 42 days, with patients receiving the drug dosed at 10 mg once daily for 14 days followed by 5 mg once daily for 28 days. In April, the company reported that the data monitoring committee completed its review of that cohort and recommended the trial continue as designed.

The second portion of the study is evaluating an additional dosing regimen of 5 mg once daily for 14 days, followed by 2.5 mg for 28 days. Patients who complete the study and continue to meet eligibility requirements have the opportunity to enroll into the open-label extension study during which they would be followed for an additional 12 months.

Last year, the FDA granted orphan drug designation and fast track status to palovarotene to treat FOP. If the drug succeeds, Clementia could have the FOP market all to itself, since it's the only company with a drug in the pipeline to treat the condition, according to Cortellis data.

Oleg Nodelman, founder and managing director of EcoR1 Capital LLC, told BioWorld Today that his company joined "a great group of investors" based on the early data on palovarotene in FOP, the dearth of treatment options for the indication and the company's seasoned leadership in orphan diseases.

"We were introduced to the company last year, so we've had an opportunity to get to know them and we were waiting for them to come around," he said. "They're developing a drug for a truly unmet medical need – a horrible, horrible disease."

Nodelman likened the effect of FOP almost to the stuff of science fiction, except that it's very real, with patients literally growing a second skeleton.

"These patients either die very early or have a very poor quality of life," he said, "and Clementia may have a drug that completely changes the course of that disease. It's a very unique asset."

The investment opportunity "fit all of our criteria," Nodelman added, noting that the palovarotene trials have generated excitement in the physician and patient communities, helping to recruit quickly even given the indication's ultra-orphan status.

The mezzanine round will allow Clementia to generate proof-of-concept data for palovarotene in FOP. Long term, "we are committed to growing a standalone company that is focused on advancing drug development and commercialization in the rare disease space," Desjardins maintained.

But provided the palovarotene phase II program succeeds, the company "will have unlimited optionality," EcoR1's Nodelman predicted.