The Mesoblast Ltd (ASX: MSB) share price is going nowhere after the company requested a trading halt this morning.
Mesoblast requested that the trading halt remain in place ahead of an announcement about "a proposed financing". The company revealed no other details in its formal request.
The ASX confirmed Mesoblast shares would remain frozen until the earlier of the announcement or the start of trading next Tuesday.
Mesoblast share price on hold ahead of financing news
Mesoblast was the number one S&P/ASX All Ordinaries Index (ASX: XAO) share for price growth in 2024.
The ASX biotech share rose by an astounding 900% to finish the year at $3.10 apiece on 31 December.
Already in the new year, Mesoblast shares have hit a four-year high of $3.37.
They closed at $2.81 apiece yesterday.
What powered the 900% rise in Mesoblast shares last year?
Investors have re-engaged with the ASX healthcare stock after the company finally gained approval from the United States Food and Drug Administration for its lead drug, remestemcel-L, last month.
Branded Ryoncil, remestemcel-L treats steroid-refractory acute graft versus host disease (SR-aGvHD) in children aged two months and older, including adolescents and teenagers.
It's a life-threatening condition with a high mortality rate.
This was a really big deal for the company, given that the FDA had previously rejected the drug.
It requested more trials and data, which has delayed the drug's commercial launch for years.
The FDA indicated Mesoblast finally had enough clinical data to support a resubmission for approval last March. The company resubmitted its request for approval in July.
In anticipation of a positive result, more investors bought Mesoblast shares last year. This pushed the Mesoblast share price higher over the first half of 2024.
The company made other announcements during the year, which added to Mesoblast shares' momentum.
In September, the company announced a convertible note subscription with its largest shareholder to give it access to funds if the FDA approved the drug.
Under the agreement, Mesoblast can issue up to US$50 million in convertible notes in US$10 million tranches over 90 days after FDA approval.
Mesoblast announced that the FDA had approved Ryoncil on 19 December.
The news sent the Mesobast share price rocketing 54.04% higher in one day.
Transplant physician Dr Joanne Kurtzberg, director of the Marcus Center for Cellular Cures at Duke University Medical Center, said Ryoncil would be "life-saving for so many children".
Every year in the United States, approximately 10,000 patients undergo an allogeneic bone marrow
transplant. About 1,500 of them are children.
Approximately 50% develop aGvHD and almost half of those do not respond to steroids, which are the current first-line treatment.
In a single-arm multicenter Phase 3 trial of children with SR-aGvHD, 89% of whom had high-severity Grade C or Grade D disease, 70% achieved an overall response by the 28th day of treatment with Ryoncil.
The overall response rate is a measure that predicts survival in aGVHD.
Ryoncil is also the first mesenchymal stromal cell (MSC) therapy approved in the US for any condition.
