The Mesoblast Limited (ASX: MSB) share price has sunk around 10% after providing an update.
Mesoblast is a business involved in allgeneic cellular medicines for inflammatory diseases.
Here’s what happened
Mesoblast announced the top line results from its DREAM-HF Phase 3 randomized controlled trial of its allogeneic cell therapy rexlemestrocel-L (REVASCOR) in 537 patients with advanced chronic heart failure.
The biotech business explained that over an average of 30 months of follow-up, patients with advanced chronic heart failure who received a single endomyocardial treatment with rexlemstrocel-L on top of maximal therapies had a 60% reduction in heart attacks and a 60% reduction in death from cardiac causes when treated at an earlier stage in the progressive disease process.
However, despite the reduction in the pre-specified endpoint of cardiac death, there was no reduction in recurrent non-fatal decompensated heart failure events, which was the trial’s primary endpoint.
Mesoblast said this suggests rexlemestrocel-L reduces mortality by mechanisms that are distinct from those of existing drugs that reduce hospitalisation rates, but it does not significantly impact cardiac mortality.
Mesoblast CEO Dr Silviu Itescu said: “There is an urgent need for new therapies that can reduce the high death rates in heart failure patients by different modes of action from existing drugs which reduce hospitalisation rates but have not significantly reduced mortality rates.
“The reduction in mortality seen with rexlemestrocel-L in advanced chronic heart failure underlines the power of this technology and the commitment of Mesoblast to address diseases in patients with high unmet needs which are refractory to existing therapies.”
There were further comments from Mesoblast Chief Medical Officer Dr Fred Grossman, who said: “We expect the mortality benefit observed in this seminal phase 3 trial will support a potential path for approval of rexlemestrocel-L in patients with advanced chronic heart failure. We are planning to meet and discuss potential pathways to approval based on mortality reduction with the United States Food and Drug Administration.”
Summary thoughts
Mesoblast is a very volatile business and it’s not surprising to see another double digit movement in reaction to today’s news. There could easily be a rebound on the next piece of good news, or there may be another decrease on more bad news. I’m not sure if it’s worth buying because of the binary nature of the investment outcomes – the treatments are a success or not.
CSL Limited (ASX: CSL) seems like the type of biotech I’d prefer to invest in because it’s more consistent with its growth. However, in terms of ASX growth shares I think I’d prefer to buy shares of Pushpay Holdings Ltd (ASX: PPH) or A2 Milk Company Ltd (ASX: A2M).