The Mesoblast limited (ASX: MSB) share price has jumped 8.9% this morning after the healthcare company announced a review date for its remestemcel-L treatment has been granted by the FDA. The review will assess data supporting Mesoblast's application for approval for remestemcel-L in the treatment of steroid-refractory acute graft versus host disease (SR-aGVHD) in children.
SR-aGVHD is a potentially life threatening complication from bone marrow transplants for blood cancer. There are currently no FDA approved treatments in the United States for children under the age of 12 with SR-aGVHD. An advisory committee will review the data on 13 August and make a recommendation regarding approval to the FDA.
What is remestemcel-L?
Remestemcel-L is a therapy utilising mesenchymal stem cells derived from bone marrow. It is administered via a series of intravenous infusions. The treatment is believed to counteract inflammatory processes and enable recruitment of naturally occurring anti-inflammatory cells to involved tissues. Remestemcel-L has gained significant publicity recently due to its use in the treatment of COVID-19 patients.
Remestemcel-L is currently undergoing phase 3 trials to assess its use in treating adult COVID-19 patients with acute respiratory distress syndrome. The product is also available in the US for compassionate use for child COVID-19 patients with cardiovascular and other complications of multisystem inflammatory syndrome.
How is the Mesoblast share price performing?
During the nine months to 31 March 2020, Mesoblast reported revenues of US$31.5 million. This was a 113% increase on the prior corresponding period when US$14.8 million in revenue was reported. Loss after tax reduced to US$45.3 million for the first nine months of FY20, compared to a loss of US$69.1 million for the first nine months of FY19.
The Mesoblast share price has gained 146% over the last year and 233% from its March low. Encouraging results from clinical trials of remestemcel-L have pushed the Mesoblast share price higher, as has its use in the treatment of coronavirus. Mesoblast's increased share price saw it join the S&P/ASX 200 (ASX: XJO) in the most recent quarterly rebalance.
What's next for Mesoblast?
Mesoblast had cash on hand of $60.1 million at 31 March 2020. An additional $138 million of capital was raised in May which will be used to scale up manufacturing of remestemcel-L for the treatment of COVID-19 patients. The company is now well positioned to pursue this new imperative with clinical trials underway.
