The Mesoblast Limited (ASX: MSB) share price soared earlier today. This came after news the company has requested to meet with the United States Food and Drug Administration (FDA) to discuss its chronic lower back pain medication.
Shortly after the opening bell, Mesoblast shares surged to $2.08 — 5.05% higher than its closing price yesterday. It has since settled lower to $2.01, up 1.52% at the time of writing.
According to Mesoblast, its drug would be an alternative therapy to opioids. This is important because excessive use of opioids is considered a major problem by US policymakers and regulators.
More than 50% of US opioid prescriptions are given to patients with chronic lower back pain.
Let's take a look at today's news from Mesoblast.
Mesoblast's meeting with FDA
According to the release, the company has requested and expects to be granted, a meeting with the FDA in the September quarter.
In the meeting, Mesoblast and the FDA would discuss pathways to have rexlemestrocel-L approved for use in the United States.
The company recently completed a 404 patient phase 3 trial of rexlemestrocel-L. The trial saw rexlemestrocel-L successfully treating patients with chronic inflammatory back pain caused by degenerative disc disease.
According to Mesoblast, it will use the results from a future US-based trial to help achieve product approvals in the United States and the European Union.
To bypass the need for a European Union-based trial, Mesoblast envisages 20% of the trial's patients will be European. Mesoblast states that including European patients in the trial will provide "regulatory harmonisation", cost efficiencies, and a faster timeline.
To make it happen, the company has amended its collaboration agreement with Grünenthal, its partner in Europe and Latin America.
Mesoblast is likely to be eligible for payments of up to US$112.5 million before rexlemestrocel-L launches in the European Union. To be eligible, it must pass certain clinical and regulatory milestones and reimbursement targets.
The company states that the payments could reach a combined US$1 billion. However, that figure is dependant on the outcome of phase 3 studies and patient adoption. It will also receive royalties on product sales.
Commentary from management
Mesoblast's chief medical officer, Dr Fred Grossman was quoted in the company's release. He said:
We look forward to discussing with the FDA the most efficient path forward given the durable pain reduction for at least two years and the opioid-sparing activity from a single administration of rexlemestrocel-L that was observed in the recent Phase 3 trial.
Mesoblast share price snapshot
The Mesoblast share price needs all the good news it can get to boost its recent poor performance.
Currently, shares in Mesoblast are over 13% lower than they were at the beginning of 2021. They have also fallen around 40% since this time last year.
The company has a market capitalisation of around $1.29 billion, with approximately 647 million shares outstanding.
