Mesoblast (ASX:MSB) - CEO, Silviu Itescu
CEO, Silviu Itescu
Source: Mesoblast
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  • Mesoblast (MSB) advises its agreement with Novartis to develop a COVID-19 treatment has been terminated early
  • The two companies entered into a deal back in 2020 to commercialise MSB’s remestemcel-L for patients with acute respiratory distress syndrome (ARDS) from COVID-19
  • MSB didn’t say why the agreement was terminated, instead the business advised it will continue pushing for remestemcel-L to be designated emergency use authorisation
  • Mesoblast missed the primary endpoint in recent trials of the treatment, but the observed mortality reduction was sufficient enough for it to push ahead with another trial
  • Shareholders can’t react to the Novartis trial termination just yet, as shares in Mesoblast have been placed in a trading halt, last trading at $1.70 each

Mesoblast (MSB) advises its agreement with Novartis to develop a COVID-19 treatment has been terminated early.

The two companies entered into a deal back in 2020 to commercialise MSB’s remestemcel-L for patients with acute respiratory distress syndrome (ARDS) from COVID-19.

MSB hasn’t stated why the agreement with Novartis was terminated, with the Swiss based business having handed over US$50 million (A$70.13 million) to the ASX-lister.

Instead, Mesoblast advised it would continue pushing for remestemcel-L to be granted an emergency use authorisation (EUA) — a direct path to market.

The treatment missed the primary endpoint in recent trials, but the observed mortality reduction was sufficient enough for MSB to push ahead with a third trial.

The healthcare stock believes COVID-19, and associated ARDS, will continue to be a global issue for some years, despite the number of vaccines available.

Mesoblast will now focus on initiating a Phase 3 trial of remestemcel-L that may support an EUA.

Shareholders haven’t been able to react to the Novartis trial termination just yet, as shares in Mesoblast have been placed in a trading halt.

MSB shares last traded at $1.70 each.

MSB by the numbers
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