Will Mesoblast’s Heart Failure & Chronic Low Back Pain Trial Data Readouts Be Heartening Or Painful?

Shares of Mesoblast Limited (MESO) have gained over 120% year-to-date and trade around $16 as the company awaits two important trial catalysts this month.

Mesoblast, based in Australia, is focused on developing innovative allogeneic cellular medicines to treat complex diseases resistant to conventional standard of care and where inflammation plays a central role.

The company has three product candidates in phase III development – Remestemcel-L for the treatment of steroid-refractory acute graft versus host disease (SR-aGVHD), and for moderate to severe acute respiratory distress syndrome (ARDS) due to COVID-19 infection; Revascor for advanced chronic heart failure; and MPC-06-ID for chronic low back pain due to degenerative disc disease.

Despite an outside panel of experts convened by the FDA voting overwhelmingly in favor of Remestemcel-L for the treatment of steroid-refractory acute graft versus host disease on September 30, the regulatory agency refused to approve the cellular therapy product and handed a Complete Response Letter on October 2.

Remestemcel-L is also under a phase III trial in ventilator-dependent patients with acute respiratory distress syndrome (ARDS) due to COVID-19 infection. The study is designed to enroll 300 patients and the primary endpoint is reduction in 30-day mortality relative to maximal care. The full recruitment in the trial is expected to complete during the first quarter of 2021.

Mesoblast has a worldwide license and collaboration agreement with Novartis (NVS) for the development, manufacture and commercialization of Remestemcel-L.

The second late-stage investigational product is Revascor, which is under a phase III trial for advanced chronic heart failure. This trial is evaluating Revascor as an add-on treatment to standard-of-care for reduction of recurrent non-fatal heart failure-related major adverse cardiac events (HF-MACE) and terminal cardiac events (TCEs) in 566 patients with advanced chronic heart failure and reduced ejection fraction.

Data readout from the Revascor trial is due this quarter.

Another product candidate in the pipeline, which is also under a phase III trial, is MPC-06-ID for chronic low back pain in 404 patients. The final study visits for all patients have been completed.

Data readout from the MPC-06-ID trial is also due this quarter.

Cash Position:

At November 20, 2020, the company had cash of US$158 million.

MESO has traded in a range of $3.12 to $21.28 in the last 1 year. The stock closed Friday’s trading at $16.96, up 1.01%.

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