Mesoblast’s GvHD Therapy Could Be Pivotal

Mesoblast (MSB) will launch a stem cell therapy for acute graft-versus-host disease (GvHD) in 2016. Baillieu Holst believes clinical success in the upcoming trials, and subsequent US Food & Drug Administration approval, have potential to usher in a boom in regenerative medicine as US investors realise the early scientific promise of stem cells is translating into clinical and commercial reality. This development has now transcended the ethical issues associated with embryonic stem cells.

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Analyst Views

MSB – Credit Suisse rates the stock as Outperform

Mesoblast has acquired the Osiris Therapeutics stem cell business in the US. The broker had previously though Meso’s Mesenchymal Precursor stem cells offered greater efficacy and manufacturing scalability than Osiris’ more heterogeneous offering, but then both do offer benefits, the broker concedes. The broker thus sees the benefits of having a wider opportunity for success across different diseases but wonders if management isn’t spreading itself a bit thin with this acquisition.

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