The Mesoblast limited (ASX: MSB) share price has had a disappointing start to the week and is down 3% to $1.34 in morning trade.
This is despite the world leader in developing allogeneic cellular medicines making a positive announcement this morning.
What did Mesoblast announce?
This morning Mesoblast announced its licensee in Japan, JCR Pharmaceuticals, has filed to extend marketing approval of TEMCELL HS Inj. for use in patients with Epidermolysis Bullosa (EB).
TEMCELL is already approved for the treatment of acute graft versus host disease (aGVHD), and was the first allogeneic cellular medicine to receive full regulatory approval in Japan.
According to the release, the two parties have amended their license agreement in order for JCR to access Mesoblast’s mesenchymal stem cell wound healing patents to enable it to develop and commercialize TEMCELL for EB. Mesoblast will receive royalties on TEMCELL product sales for EB.
In addition to this, JCR has received orphan designation for TEMCELL in the treatment of EB based on promising results from an investigator-initiated trial at Osaka University Hospital where TEMCELL was subcutaneously administered.
As well as benefiting from royalties, Mesoblast will also benefit from being given access to clinical data generated by JCR in Japan. This will be used to support the development and commercialisation of its MSC product candidate remestemcel-L in markets outside Japan for EB and other wound healing applications.
Finally, Mesoblast revealed that it plans to file for United States FDA regulatory approval of remestemcel-L in the near future for the treatment of aGVHD.
Should you invest?
I think Mesoblast is a quality company and has solid long term growth potential, but I would still choose CSL Limited (ASX: CSL) ahead of it.
In addition to this, for valuation reasons I think pharmaceutical company Mayne Pharma Group Ltd (ASX: MYX) could also be a worthy alternative..
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.