The Mesoblast Limited (ASX: MSB) share price is soaring today on the back of a clinical trial update.
In morning trade, the company's shares are trading at $1.495, up 12%.
Mesoblast is working on regenerative medicines for serious inflammatory conditions including chronic back pain.
Image source: Getty Images
What is impacting the share price today?
Investors are responding to feedback the company received from the FDA's Office of Tissues and Advanced Therapies (OTAT).
The company is trialling the use of its flagship rexlemestrocel-L product in the treatment of chronic back pain.
Mesoblast will be conducting another phase 3 trial based on OTAT's review of initial trial data.
The regulatory body agrees with Mesoblast's plan to use pain reduction at 12 months as the key endpoint for this pending trial.
Opioid use reduction and functional improvement will be secondary endpoints for the trial.
If the trial blasts ahead to EU regulatory approval, the company will be eligible for multi-million dollar payments.
Mesoblast said it could receive a US$112.5 million payout ahead of the product launch from partner company Grünenthal if the approval goes ahead.
The company predicts milestone payments could reach a mammoth US$1 billion depending on trial results and patient uptake.
Mesoblast sees the potential to market its product as a solution to excessive use of opioids in the US.
What else is happening at Mesoblast
The Mesoblast share price crashed on Tuesday after pharmaceutical giant Novartis terminated an agreement with the company to use remestemcel-L to treat acute respiratory distress syndrome (ARDS) from COVID-19.
However, the company maintains that it remains highly focused on bringing this product to the market to help patients impacted by this condition.
Mesoblast still sees potential to pursue emergency use authorisation of remestemcel-L based on clinical results.
Mesoblast share price snapshot
In the past 12 months, the Mesoblast share price has plunged 60% and dived nearly 34% in the year to date.
Shares in the company have slipped 15% in the past month and 22% in the past week.
Mesoblast has a market capitalisation of roughly $967 million based on the current share price.
