Clementia pharmaceuticals IPO

Clementia pharmaceuticals IPO

The Clementia Pharmaceuticals IPO planned for the middle months of 2017 seemed, on the face of it, to be a bright prospect for all concerned. The Montreal based manufacturer of treatments for rare bone and tissue complaints, was looking to sell 7.15 million shares of common stock for a price of $14 a share and thus raise $100 million. Surely this was good news for the company, for potential investors and also for those sufferers from rare abnormal growth conditions which could potentially be treated by the mid-stage biopharmaceutical company’s cutting edge treatments. In matters such as these, where cutting edge technologies are being employed, the lay observer is forced to take much on trust. You might read that Clementia was developing a treatment for Fibro dysplasia Ossificans Progressiva and that this treatment employs retinoic acid receptor gamma agonists and be none the wiser for the information unless you happen to hold a PhD in the relevant fields. It suffices for us to know that Clementia has several very promising products in the pipeline at the moment, many of them nearing the time for stage 3 trials. How does this affect the Clementia Pharmaceuticals IPO? Well, the key words here are ‘nearing’ and perhaps also rare. It is for these reasons that you might care to think deeply about this IPO and perhaps consider not jumping in right now but waiting for a time.

This is not a case of simple timidity on the part of the cautious. The fact remains the conditions that are to be treated are rare and it will thus take time for the company to find and then test its products on sample sizes sufficiently large enough to satisfy the rightly exacting standards set by the industry. Although we might admit that we are not bio-chemists we do probably know that medical trials to be valid need to be on samples that are large enough to permit valid statistical analysis, and also permit double blind testing and other necessary safeguards. Clementia’s cutting edge treatments are not quite at this stage just yet. They have shown very promising results but these might turn to be meaningless when compared to wider and more comprehensive tests carried out on large populations. Clementia’s treatments will be reaching this final stage in 2019. Taking these points into mind, it is not surprising to learn that some observers have been suggesting that it might be as well to avoid the Clementia Pharmaceuticals IPO and wait for the Stage 3 results to come in. The Pharmaceutical Industry is itself cautious about the introduction of new products and also about how the statistics derived from the tests which it carries out are interpreted. It might be well for investors to copy the companies and also to exercise a certain degree of prudence and caution at this time with the Clementia Pharmaceuticals IPO.

(Simon Topliss, Research)

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