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Mesoblast Gets Favorable Votes From FDA Committee for Ryoncil

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Mesoblast Limited (MESO - Free Report) announced that the Oncologic Drugs Advisory Committee (ODAC) of the FDA voted in the ratio of 9:1 in favor of the available data to support the efficacy of remestemcel-L (Ryoncil) in pediatric patients with steroid-refractory acute graft versus host disease (SR-aGVHD).

Although the FDA will consider the recommendation of the advisory committee, it is not bound by it.

Ryoncil is an investigational therapy comprising culture-expanded mesenchymal stem cells derived from the bone marrow of an unrelated donor.

The news should relieve wary investors as shares of the company had plunged earlier in the week.

Per the FDA, the data provided by the company did not demonstrate the proposed effectiveness of the therapy as required. The proposed mechanism of action for remestemcel-L is a reduction in pathogenic inflammation mediated through the immunomodulatory activity of the mesenchymal stromal cells active ingredient.

Nevertheless, the ODAC committee has now voted in favor of the candidate.

It has been accepted for Priority Review by the FDA with an action date of Sep 30, 2020.

Shares of Mesoblast have surged 60.3% so far this year compared with the industry’s growth of 4.2%.

A potential approval of its lead candidate will be a significant boost for Mesoblast.

We note that Incyte’s (INCY - Free Report) Jakafi is already approved for steroid-refractory acute graft-versus-host disease (GVHD) in adult and pediatric patients 12 years and older. Johnson & Johnson’s (JNJ - Free Report) Imbruvica (ibrutinib) is also approved for the treatment of adult patients with chronic GVHD after the failure of one or more lines of systemic therapy.

Remestemcel-L is also being developed for other inflammatory diseases in children and adults, including moderate-to-severe acute respiratory distress syndrome (ARDS). Mesoblast is completing phase III studies for its product candidates for advanced heart failure and chronic low-back pain.

Earlier, the company said the independent Data Safety Monitoring Board (DSMB) has set a date for early September to complete the first interim analysis of the phase III trial of remestemcel-L in ventilator dependent COVID-19 patients with moderate-to-severe ARDS. The trial’s first 90 patients will complete 30 days of follow up during August, after which the DSMB will perform an interim analysis review of the safety and efficacy data. The DSMB will then inform Mesoblast on whether the trial should proceed as planned or stop early.

Zacks Rank & A Stock to Consider

Mesoblast currently carries a Zacks Rank #3 (Hold). A better-ranked stock in the sector includes Horizon Therapeutics Public Limited Company (HZNP - Free Report) , which sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Earnings estimates for Horizon have moved up 45 cents for 2020 and 80 cents for 2021 in the past seven days.

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