We are a clinical-stage biopharmaceutical company focused on improving the lives of patients with genetically defined diseases in areas of high unmet medical need, with an initial focus on rare diseases. We have developed a proprietary product engine that we employ to systematically identify and validate cellular drug targets that can potentially modulate gene expression to treat the known root cause of genetically defined diseases. We are using our product engine to identify targets that can be drugged by small molecules regardless of the particular underlying mechanism of gene mis-expression. We have identified drug targets to treat the root causes of facioscapulohumeral muscular dystrophy, or FSHD, and certain hemoglobinopathies, namely sickle cell disease, or SCD, and B-thalassemia. We expect to initiate a Phase 2b clinical trial of losmapimod, our product candidate for FSHD, in mid-2019. We commenced a Phase 1 clinical trial in February 2019 to obtain safety and tolerability data for losmapimod in patients with FSHD. We plan to submit an investigational new drug application, or IND, for FTX-HbF, our product candidate for certain hemoglobinopathies, in mid-2020.
Use of proceeds:We estimate that the net proceeds from our issuance and sale of 4,500,000 shares of our common stock in this offering will be approximately $68.0 million, assuming an initial public offering price of $17.00 per share, which is the midpoint of the price range set forth on the cover page of this prospectus, after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us.If the underwriters exercise their option to purchase additional shares of our common stock in full, we estimate that the net proceeds from this offering will be approximately $78.7 million.A $1.00 increase (decrease) in the assumed initial public offering price of $17.00 per share, which is the midpoint of the price range set forth on the cover page of this prospectus, would increase (decrease) the net proceeds to us from this offering by approximately $4.2 million, assuming the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us.An increase (decrease) of 1,000,000 shares in the number of shares offered by us, as set forth on the cover page of this prospectus, would increase (decrease) the net proceeds to us from this offering by approximately $15.8 million, assuming no change in the assumed initial public offering price per share and after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us.As of March 31, 2019, we had cash and cash equivalents of $62.5 million.We currently estimate that we will use the net proceeds from this offering, together with our existing cash and cash equivalents, as follows: • approximately $45.0 million to advance losmapimod for FSHD; • approximately $15.0 million to advance our hemoglobinopathies program; • approximately $30.0 million to fund our ongoing product engine and discovery efforts; and • the remainder for working capital and other general corporate purposes.This expected use of net proceeds from this offering and our existing cash and cash equivalents represents our intentions based upon our current plans and business conditions, which could change in the future as our plans and business conditions evolve.The amounts and timing of our actual expenditures may vary significantly depending on numerous factors, including the progress of our development programs, the status of and results from clinical trials, the timing of regulatory submissions and the outcome of regulatory review, as well as any collaborations that we may enter into with third parties for our product candidates, and any unforeseen cash needs.As a result, our management will retain broad discretion over the allocation of the net proceeds from this offering.Based on our planned use of the net proceeds from this offering, together with our existing cash and cash equivalents, we estimate that such funds will be sufficient to fund our operating expenses and capital expenditure requirements into the third quarter of 2021.We anticipate that the net proceeds from this offering together with our existing cash and cash equivalents will be sufficient to allow us to complete our ongoing clinical trials, including our Phase 2b clinical trial, of losmapimod and conduct IND-enabling studies for and initiate a Phase 1 clinical trial of FTX-HbF.We will require additional capital to advance losmapimod through additional clinical trials, if required, to advance FTX-HbF through necessary clinical trials and to commercialize any of our product candidates, if we receive regulatory approval.We have based these estimates on assumptions that may prove to be wrong, including assumptions regarding the clinical trials necessary for FDA approval of our product candidates, and we could use our capital resources sooner than we currently expect.Due to the numerous risks and uncertainties associated with product development, including the risks and uncertainties with respect to successful enrollment and completion of clinical trials, at this time, we cannot reasonably estimate the amount of additional funding that will be necessary to complete the clinical development of losmapimod or any future product candidates.If we receive regulatory approval for losmapimod or other product candidates, we expect to incur significant commercialization expenses related to product manufacturing, sales, marketing and distribution.Pending our use of the net proceeds from this offering, we intend to invest the net proceeds in a variety of capital preservation investments, including short-term, investment-grade, interest-bearing instruments and U.S. government securities.
Competition:The biotechnology and pharmaceutical industries are characterized by rapidly advancing technologies, intense competition and a strong emphasis on proprietary products.While we believe that our technologies, knowledge, experience and scientific resources provide us with competitive advantages, we face competition from many different sources, including major pharmaceutical, specialty pharmaceutical and biotechnology companies, academic institutions and governmental agencies and public and private research institutions.Any product candidates that we successfully develop and commercialize will compete with existing therapies and new therapies that may become available in the future.Many of the companies against which we are competing or against which we may compete in the future have significantly greater financial resources and expertise in research and development, manufacturing, preclinical testing, conducting clinical trials, obtaining regulatory approvals and marketing approved products than we do.Mergers and acquisitions in the pharmaceutical and biotechnology industry may result in even more resources being concentrated among a smaller number of our competitors.Smaller or early stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies.These competitors also compete with us in recruiting and retaining qualified scientific and management personnel and establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary for, our programs.The key competitive factors affecting the success of all of our therapeutic product candidates, if approved, are likely to be their efficacy, safety, convenience, price, the effectiveness of companion diagnostics in guiding the use of related therapeutics, the level of generic competition and the availability of reimbursement from government and other third-party payors.Our commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more effective, have fewer or less severe side effects, are more convenient or are less expensive than any products that we may develop.Our competitors also may obtain FDA or other regulatory approval for their products more rapidly than we may obtain approval for ours, which could result in our competitors establishing a strong market position before we are able to enter the market.In addition, our ability to compete may be affected in many cases by insurers or other third-party payors seeking to encourage the use of generic products.If our product candidates achieve marketing approval, we expect that they will be priced at a significant premium over competitive generic products.If our lead product candidates are approved for the indications for which we are currently undertaking clinical trials, they will compete with the therapies and currently marketed drugs discussed below.FSHD There are no approved therapies for the treatment of FSHD.Controlled trials of albuterol, corticosteroids and a myostatin inhibitor all failed to demonstrate a clinical benefit to patients with FSHD.Low-intensity aerobic exercise tailored to the patient's distribution of weakness may provide some limited beneficial effect.Limited range of motion in the shoulder girdle can stem from periscapular muscle weakness, and in such cases surgical scapular fixation can result in some functional improvement for certain patients.There is also no standard practice regarding the use of physical or occupational therapy across countries and sites.We are not aware of any product candidate currently in clinical development for FSHD with the same mechanism of action as losmapimod or that is designed to treat the root cause of FSHD.We are aware of ACE-083, a locally injected myostatin inhibitor for intermittent treatment of weakness for ankle dorsiflexion (foot drop) and elbow flexion, which is currently in Phase 2a clinical development for FSHD by Acceleron. aTyr Pharma, Inc., or aTyr, conducted a Phase 1/2 clinical trial of resolaris, a physiocrine immune modulation protein. aTyr discontinued development of resolaris in FSHD. aTyr publicly disclosed that they do not intend to further develop resolaris without a partner.SCD Approved drug treatments for SCD focus primarily on the management and reduction of pain episodes.The two drug treatments approved in the United States are hydroxyurea and L-glutamine.Hydroxyurea, marketed by Bristol-Myers Squibb Company, is approved for the treatment of anemia related to SCD, to reduce the frequency of painful crises and the need for blood transfusions.L-glutamine, marketed by Emmaus Life Sciences, Inc., is approved to reduce severe complications associated with the disorder.Blood transfusions can be utilized to decrease the sickling of RBCs.While blood transfusions can be critically important to the management of SCD, there are a number of limitations associated with this therapeutic approach, including limited patient access and serious complications such as iron overload.The only potentially curative treatment currently approved for severe SCD is bone marrow transplantation.However, this treatment option is not commonly used given the difficulties of finding a suitable matched donor and the risks associated with the treatment, which include an approximately 5% mortality rate.Bone marrow transplantation is more commonly offered to pediatric patients with available sibling-matched donors.FTX-HbF could face competition from a number of different therapeutic approaches in development for patients with SCD.Novartis is conducting Phase 3 clinical trials of crizanlizumab, an anti-P-selectin monoclonal antibody, for the prevention of vaso-occlusive crises in patients with SCD.In January 2019, Novartis announced that crizanlizumab was granted breakthrough therapy designation by the FDA, and that Novartis expected to file a BLA for crizanlizumab in the first half of 2019.Global Blood Therapeutics, Inc. is conducting a Phase 3 clinical trial of voxelotor (GBT440), a hemoglobin modifier, to prevent the sickling of RBCs.GlycoMimetics Inc. and Pfizer, Inc. are conducting a Phase 3 clinical trial of rivipansel (GMI-1070), a pan-selectin inhibitor. bluebird has been granted conditional marketing authorization by the European Commission for ZYNTEGLO, a gene therapy, as a one-time treatment for SCD that aims to treat SCD by inserting a functional human B-globin gene into the patient's own hematopoietic stem cells ex vivo and then transplanting the modified stem cell into the patient's bloodstream.EpiDestiny, Inc., or EpiDestiny, in collaboration with Novo Nordisk A/S, is evaluating EPI01, a small molecule designed to increase production of fetal hemoglobin, in Phase 2 clinical trials.Imara, Inc. is evaluating IMR-687, a PDE9 inhibitor, in a Phase 2a clinical trial in patients with sickle cell anemia.Aruvant Sciences, Inc. is evaluating RVT-1801, a gene therapy, in a Phase 1/2 trial.Sangamo Therapeutics Inc., or Sangamo, in collaboration with Bioverativ Inc., or Bioverativ, is developing BIVV-003, a gene editing cell therapy that modifies cells to produce functional RBCs using fetal hemoglobin.There are also several other gene editing approaches being evaluated by Intellia Therapeutics, Inc. (in collaboration with Novartis), Editas Medicine, Inc. and CRISPR Therapeutics AG (in collaboration with Vertex Pharmaceuticals Incorporated, or Vertex).Pfizer conducted a Phase 1b clinical trial with PF-04447943, a PDE9 inhibitor, in patients with SCD.B-thalassemia The current standard of care for many patients with B-thalassemia is frequent blood transfusions to manage anemia.The only potentially curative therapy for B-thalassemia is allogeneic hematopoietic stem cell transplant, which is associated with serious risk and is limited to patients with a suitable donor.The European Commission granted conditional marketing authorization for ZYNTEGLO, a gene therapy developed by bluebird for the treatment of adult and adolescent patients with transfusion-dependent B-thalassemia and with certain genotypes, in Europe in June 2019. bluebird announced that it plans to file a BLA in the United States in 2019.FTX-HbF could face competition from a number of different therapeutic approaches are in development as a therapeutic option for patients with transfusion-dependent B-thalassemia.Acceleron, in collaboration with Celgene, is conducting Phase 3 clinical trials of luspatercept (ACE-536), an erythroid maturation agent.Celgene submitted a BLA for luspatercept for the treatment of adult patients with anemia associated with B-thalassemia and who require frequent transfusions.Celgene and Acceleron submitted a marketing authorization application, or MAA, to the EMA in the second quarter of 2019.Bellicum Pharmaceuticals, Inc. is conducting a Phase 1/2 clinical trial to evaluate a modified donor T cell therapy to be used in conjunction with hematopoietic stem cell transplant.Kiadis Pharma is conducting Phase 2 and Phase 3 clinical trials of an adjunctive T cell immunotherapy treatment in conjunction with hematopoietic stem cell transplant.EpiDestiny, in collaboration with Novo Nordisk A/S, is evaluating EPI01, a small molecule designed to increase production of fetal hemoglobin, in Phase 2 clinical trials.Orchard Therapeutics plc is conducting Phase 2 clinical trials of OTL-300, an autologous ex vivo gene therapy for the treatment of transfusion-dependent B-thalassemia.Sangamo, in collaboration with Bioverativ, is conducting a Phase 1/2 clinical trial of ST-400, which uses a genome-edited cell therapy approach designed to produce functional RBCs using fetal hemoglobin.CRISPR Therapeutics AG, in collaboration with Vertex, is conducting a Phase 1/2 clinical trial of CTX001, which uses a gene editing approach to upregulate the expression of fetal hemoglobin, in patients with transfusion-dependent B-thalassemia.