MSB 4.18% $5.27 mesoblast limited

There is nothing negative about it and all expected in Cantor's...

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    There is nothing negative about it and all expected in Cantor's research thanking Anjo for sharing!

    Cantor Fitzgerald EquityResearch
    August 7, 2020
    Mesoblast Ltd. ADR (MESO - $15.50, Overweight, Target: $23.00)

    What to Expect At Upcoming AdCom For Ryoncil

    Investment Summary.
    We remain positive on MESO ahead of the 8/13 AdCom to discuss its BLA for remestemcel-L (Ryoncil) which is an ex-vivo culture-expanded adult human mesenchymal stromal cells [MSCs] suspension for IV infusion. MESO is seeking approval of Ryoncil for the treatment of steroid-refractory acute graft-versus-host disease in pediatric patients (SR-aGVHD). A positive vote in favor of approval for Ryoncil will be an important catalyst for the MESO's stock. Ryoncil's PDUFA date is 9/30. We are expecting an approval on or around that date. MESO is prepared to launch on approval. The unmet need and survival benefit demonstrated with Ryoncil treatment along with its benign safety profile support product approval, in our view. There is no drug available to treat SR-aGvHD for those under 12 in the U.S...

    •There will be two sessions for the AdCom on 8/13. The AdCom meeting presentations will be heard, viewed, captioned, and recorded through an online teleconferencing platform. On 8/13, the committee will discuss MESO's BLA. The morning session will discuss issues related to the characterization and critical quality attributes of remestemcel-L as they relate to clinical effectiveness. The afternoon session will discuss results from clinical trials included in the BLA.

    The FDA is likely to focus more on manufacturing, product quality, its reproducibility and attributes as they correlate with clinical outcomes and product efficacy rather than safety.

    We believe the safety and efficacy, especially survival benefit, demonstrated in three studies in over 300 pediatric patients provide strong support for approval. Another debate could be if additional clinical work may be needed for approval. This will be more clear when the briefing documents come out next week. If approved, MESO's Ryoncil will be the first allogeneic stem cell product to be launched in the U.S. market.
    •NVS AdCom serves as a proxy and MESO is prepared to address concerns. Novartis' (NVS, NC) Kymriah AdCom may be a good proxy for the types of questions the panel may ask of MESO for Ryoncil. Kymriah and Ryoncil are both cell therapies and the transcript gives some insights on CMC as well as clinical areas of focus. Please reach out if you would like a copy of the transcript. This being said, Ryoncil does not have the same types of safety concerns. Unlike Novartis’ Kymriah, which had some serious safety risks related to cytokine release syndrome and neurotoxicity, we believe the safety of Ryoncil is unlikely to be the key focus of the FDA or the committee. Ryoncil has very low risk of side effects with no serious adverse events seen in ~1,100 patients across different indications. Ryoncil works in GvHD by targeting the immune overreaction or cytokine storm process. The Kymriah AdCom focused a lot around REMS, which we believe, will not be the key highlight for Ryoncil. All this being said, we think it will be interesting to see if the Agency looks at an efficacy link to manufacturing for Ryoncil. We have seen for cell therapies that manufacturing a better/consistent product leads to a better efficacy result.
    •Quality manufacturing and efficacy will be supported by MESO's data. We believe that MESO has the necessary data in place to address any FDA concerns regarding product quality, manufacturing and processes. MESO has potency assays and experience from clinical trials to correlate this potency to measurable clinical outcomes. The manufacturing process of CAR-T therapy which is autologous is likely to lead to heterogeneous cells rather than the manufacturing process for MSCs. NVS had experience from 250 patients by the time it received approval from the FDA, while MESO has clinical data from three studies which covered over 300 pediatric patients with aGvHD as well as safety information across several hundred more patients in different indications, which provides them more experience with the cells. The other focus of the FDA is likely to be efficacy which will be discussed in the afternoon clinical session. MESO's clinical data have demonstrated the effectiveness of the treatment in children with SR-aGVHD, in terms of response rates and survival benefit in the most severe forms of this disease where mortality at 12 months is ~90%, based on the literature.
    •Recent Ryoncil publications support a positive outcome for AdCom. We would note three recent publications that support a positive outcome for MESO's AdCom. These are: 1) Study 275: Updated Expanded Access Program for Remestemcel-L in Steroid-Refractory Acute Graft-versus-Host Disease in Children, 2) A Phase 3, Single-Arm, Prospective Study of Remestemcel-L, Ex Vivo Culture-Expanded Adult Human Mesenchymal Stromal Cells for the Treatment of Pediatric Patients Who Failed to Respond to Steroid Treatment for Acute Graft-versus-Host Disease, And, 3) A Phase 3 Randomized Study of Remestemcel-L versus Placebo Added to Second-Line Therapy in Patients with Steroid-Refractory Acute Graft-versus-Host Disease. Please reach out if you would like a copy of these studies. These publications and the numerous studies using Ryoncil highlight that MESO's application for Ryoncil could include additional, supportive data we have not seen yet. We wonder if this could be part of the AdCom discussion as well.

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