Silviu Itescu, Mesoblast CEO

Mesoblast shares tank af­ter No­var­tis aban­dons a part­ner­ship for the biotech's po­ten­tial Covid-19 treat­ment

No­var­tis of­fered up $25 mil­lion in cash last No­vem­ber for the rights to Mesoblast’s po­ten­tial cell ther­a­py for Covid-19. But af­ter a Phase III flunk, the Big Phar­ma’s now get­ting cold feet — and Mesoblast’s stock is suf­fer­ing big time.

Mesoblast shares $MESO tanked more than 17% on Tues­day morn­ing af­ter an­nounc­ing that No­var­tis has walked out on its part­ner­ship for remestem­cel-L. And be­cause the ter­mi­na­tion oc­curred be­fore clos­ing, Mesoblast missed out on up­front pay­ments of $25 mil­lion cash and a $25 mil­lion eq­ui­ty in­vest­ment.

The rea­son? Sub­par da­ta, ac­cord­ing to No­var­tis.

“Af­ter as­sess­ing ad­di­tion­al da­ta, the to­tal­i­ty of ev­i­dence from the Phase III tri­al is not suf­fi­cient to con­tin­ue with the col­lab­o­ra­tion agree­ment. No safe­ty con­cerns have been iden­ti­fied,” the com­pa­ny said in a state­ment to End­points News. 

No­var­tis was drawn to remestem­cel-L af­ter an open-la­bel com­pas­sion­ate use pro­gram sug­gest­ed an 83% sur­vival rate in pa­tients on ven­ti­la­tors who were treat­ed with the ex­per­i­men­tal cell ther­a­py last March. Then in De­cem­ber, Mesoblast cut a 300-per­son Phase III tri­al short af­ter a da­ta safe­ty mon­i­tor­ing board con­clud­ed the ther­a­py was “not like­ly” to reach its pri­ma­ry end­point, a 43% re­duc­tion in mor­tal­i­ty at 30 days.

That Oc­to­ber, the FDA is­sued a com­plete re­sponse let­ter for the same can­di­date in a dif­fer­ent in­di­ca­tion, pe­di­atric acute graft-ver­sus-host dis­ease, over is­sues with tri­al de­sign. Mesoblast had sub­mit­ted its ap­pli­ca­tion on the ba­sis of one sin­gle-arm, open-la­bel study rather than a ran­dom­ized tri­al, even though the drug demon­strat­ed a sta­tis­ti­cal­ly sig­nif­i­cant ben­e­fit in its pri­ma­ry end­point against the his­tor­i­cal con­trol rate.

The com­pa­ny al­so suf­fered a miss for its sec­ond can­di­date, rexleme­stro­cel-L, in heart fail­ure last De­cem­ber. While the ex­per­i­men­tal cell ther­a­py did not sig­nif­i­cant­ly re­duce hos­pi­tal­iza­tions over place­bo in in­di­vid­u­als with re­cur­ring heart fail­ure, Mesoblast says the pro­gram man­aged to hit sec­on­daries in mor­tal­i­ty-rate re­duc­tion for ear­li­er stages of the dis­ease.

US in­vestor group Surg­Cen­ter De­vel­op­ment threw Mesoblast a life­line in March, lead­ing a $110 mil­lion pri­vate place­ment.

De­spite the set­backs, Mesoblast still thinks there’s a path for­ward for remestem­cel-L in acute res­pi­ra­to­ry dis­tress syn­drome due to Covid-19.

“The ob­served mor­tal­i­ty re­duc­tion with remestem­cel-L in pa­tients aged un­der 65 in the com­plet­ed COVID ARDS tri­al, de­spite hav­ing missed the pri­ma­ry end­point, is con­sid­ered by Mesoblast to be a suf­fi­cient­ly strong sig­nal to sup­port pur­su­ing an emer­gency use au­tho­riza­tion (EUA), the most di­rect path to mar­ket,” the com­pa­ny said in a state­ment.

Mesoblast was un­avail­able for com­ment as of press time, but End­points will up­date the sto­ry as it de­vel­ops. The com­pa­ny said in a state­ment that it’s prepar­ing to ini­ti­ate an­oth­er Phase III tri­al that may sup­port an EUA in Covid-as­so­ci­at­ed ARDS.

“Vari­ants in­clud­ing Omi­cron present a grow­ing threat due to in­creased in­fec­tiv­i­ty and im­mune eva­sion from vac­cines and mon­o­clon­al an­ti­bod­ies, in­creas­ing the ur­gent need for ther­a­peu­tics to pre­vent the like­ly high mor­tal­i­ty of those pro­gress­ing to ICU and ARDS,” the com­pa­ny said.

For a look at all End­points News coro­n­avirus sto­ries, check out our spe­cial news chan­nel.

M&A: a crit­i­cal dri­ver for sus­tain­able top-line growth in health­care

2021 saw a record $600B in healthcare M&A activity. In 2022, there is an anticipated slowdown in activity, however, M&A prospects remain strong in the medium to long-term. What are future growth drivers for the healthcare sector? Where might we see innovations that drive M&A? RBC’s Andrew Callaway, Global Head, Healthcare Investment Banking discusses with Vito Sperduto, Global Co-Head, M&A.

15 LGBTQ lead­ers in bio­phar­ma; Paul Stof­fels’ Gala­pa­gos re­vamp; As­traZeneca catch­es up in AT­TR; and more

Welcome back to Endpoints Weekly, your review of the week’s top biopharma headlines. Want this in your inbox every Saturday morning? Current Endpoints readers can visit their reader profile to add Endpoints Weekly. New to Endpoints? Sign up here.

A return to in-person conferences also marks a return to on-the-ground reporting. My colleagues Beth Synder Bulik and Nicole DeFeudis were on-site at Cannes Lions, bringing live coverage of pharma’s presence at the ad festival — accompanied by photos from Clara Bui, our virtual producer, that bring you right to the scene. You can find a recap (and links to all the stories) below.

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David Loew (Ipsen)

Ipsen snags an ap­proved can­cer drug in $247M M&A deal as an­oth­er bat­tered biotech sells cheap

You can add Paris-based Ipsen to the list of discount buyers patrolling the penny stock pack for a cheap M&A deal.

The French biotech, which has had plenty of its own problems to grapple with, has swooped in to buy Epizyme $EPZM for $247 million in cash and a CVR with milestones attached to it. Epizyme shareholders, who had to suffer through a painfully soft launch of their EZH2a inhibitor cancer drug Tazverik, will get $1.45 per share along with a $1 CVR tied to achieving $250 million in sales from the drug over four consecutive quarters as well as an OK for second-line follicular lymphoma by 1 Jan. 2028.

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AstraZeneca's new Evusheld direct to consumer campaign aims to reach more immunocompromised patients.

As­traZeneca de­buts first con­sumer cam­paign for its Covid-19 pro­phy­lac­tic Evusheld — and a first for EUA drugs

AstraZeneca’s first consumer ad for Evusheld is also a first for drugs that have been granted emergency use authorizations during the pandemic.

The first DTC ad for a medicine under emergency approval, the Evusheld campaign launching this week aims to raise awareness among immunocompromised patients — and spur more use.

Evusheld nabbed emergency authorization in December, however, despite millions of immunocompromised people looking for a solution and now more widespread availability of the drug.

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Sanofi, GSK tout 72% Omi­cron ef­fi­ca­cy in PhI­II tri­al of next-gen, bi­va­lent shot — with an eye to year-end roll­out

Sometimes, being late can give you an advantage.

That’s what Sanofi and GSK are trying to say as the Big Pharma partners report positive results from a late-stage trial of their next-gen bivalent Covid-19 vaccine, which was designed to protect against both the original strain of the SARS-CoV-2 virus and the Beta variant. Specifically, against Omicron, they note, the vaccine delivered 72% efficacy in all adults and 93.2% in those previously infected.

invoX Pharma CEO Ben Toogood (L) and F-star CEO Eliot Forster

F-star bought out in $161M all-cash deal as Hong Kong's Sino Bio­pharm looks to­ward in­ter­na­tion­al ex­pan­sion

After more than a decade and a half of charting its own course, F-star Therapeutics will now settle under a new umbrella company.

The UK biotech will be acquired by invoX Pharma, a subsidiary of Hong Kong’s Sino Biopharm, in a roughly $161 million all-cash deal, the companies announced Thursday morning. F-star’s buyout will value its shares $FSTX at $7.12 apiece, nearly an 80% premium above Wednesday’s closing price.

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Rwanda president Paul Kagame and BioNTech CEO Uğur Şahin (via BioNTech)

BioN­Tech breaks ground on first mR­NA vac­cine man­u­fac­tur­ing fa­cil­i­ty in Africa

Covid vaccine access to lower- and middle-income nations has been a concern during the length of the pandemic, but BioNTech is now pushing forward with plans to increase vaccine access for Africa.

Construction work has kicked off for an mRNA manufacturing facility in Kigali, Rwanda. According to BioNTech, the facility, dubbed the African modular mRNA manufacturing facility, has a target for the first set of manufacturing tools to be delivered to the site by the end of this year.

GSK says its drug for chron­ic hep B could ‘lead to a func­tion­al cure’ — but will it be alone or in com­bi­na­tion?

GSK, newly branded and soon-to-be demerged, shared interim results from its Phase II trial on its chronic hepatitis B treatment, one that it says has the “potential to lead to a functional cure.”

At a presentation at the EASL International Liver Congress, GSK shared that in around 450 patients who received its hep B drug bepirovirsen for 24 weeks, just under 30% had hepatitis B surface antigen and viral DNA levels that were too low to detect.

Stéphane Bancel (AP Photo/Charles Krupa)

Mod­er­na to se­cure a UK pres­ence with $1B+ in new man­u­fac­tur­ing and R&D fa­cil­i­ties

As Moderna keeps up the fight against Covid-19, recently winning authorization in the US for children under the age of five, the company is also looking to make a serious investment in the UK.

According to the UK government, Moderna will be looking to establish a vaccine research center and a manufacturing site for a series of vaccines.

Moderna will establish this new mRNA Innovation and Technology Centre to develop mRNA vaccines for a wide range of respiratory diseases, including Covid-19.