The Mesoblast limited (ASX: MSB) share price is dropping on Wednesday morning.
At the time of writing, the regenerative medicine company's shares are down 2.5% to 97 cents.
Why is the Mesoblast share price falling?
Investors have been selling Mesoblast's shares this morning after the company released an update on its first quarter update and a key trial.
In respect to the former, Mesoblast recorded minimal quarterly revenue and a loss after tax of US$16.9 million. But thanks to a recent equity raising, it finished the period with a sizeable cash balance of US$85.5 million.
Not much to get excited about there.
Trial update
Some potentially exciting news came from Mesoblast's trial update. However, so far, the market has given it a lukewarm response.
Mesoblast released the top-line long-term survival results for remestemcel-L from its pivotal Phase 3 trial (GVHD-001) in children with steroid-refractory acute graft-versus-host disease (SR-aGVHD).
According to the release, the results showed durable survival through 4 years of follow-up.
Management notes that this new long-term survival data is a key component of the company's resubmission to the FDA for remestemcel-L in the treatment of children with SR-aGVHD, which is a life-threatening condition with no approved treatments for children under 12 years.
Overall survival in the remestemcel-L cohort was 63% at 1 year, 51% at 2 years, and 49% at 4 years, with median survival of 2 to 3 years. This compares to survival rates of 40%-49% at 1 year and 25%-38% at 2 years for current treatments.
Importantly, these comparisons include very different patient cohorts, with 88% of children treated with remestemcel-L having with highest mortality risk. Whereas only 22% to 68% in other studies were considered to have severe disease.
Management believes this reaffirms the potential significance of remestemcel-L as a life-saving therapy for children with SR-aGVHD.
Dr. Joanne Kurtzberg from Duke University, was pleased with the results. She commented:
These exciting long-term results provide further evidence of remestemcel-L's potential as a highly effective treatment for SR-aGVHD in children. Responses are durable, reducing mortality of this often lethal complication of hematopoietic stem cell transplantation.
Time will tell if this data helps Mesoblast gain FDA approval. But judging by its share price performance today, investors appear unsure and may be keeping their powder dry until a decision is made.
