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Thought this latest report from Bell Potter is most encouraging:

1. Increase in royalties from TEMCELL in Japan: JCR Pharmaceuticals launched its acute Graft versus Host Disease (GvHD) product TEMCELL on 24th Feb’ 16. MSB has received in 4QCY15 US$3.5m in pre-commercial milestones triggered by the approval of TEMCELL. Under the deal sales milestones (BPe ~US$4m) as well as royalties in the mid 20% range are also payable by JCR. MSB recorded US$651,000 in royalty revenues in 1HFY17. We assume that at peak penetration (peak sales of US$83m); MSB will receive ~US$20m in annual royalty revenues from TEMCELL.

2. Results from ongoing Phase II Rheumatoid Arthritis Trial: MSB will report 12 months (52 weeks) data from its Phase II Rheumatoid Arthritis trial in 3QCY17. This would give additional insights into the durability of the impressive clinical benefit seen with MPC treatment at 12 weeks and 9 months. We expect a partnering deal at the back of the 52 weeks data.

3. Interim analysis from Phase III congestive heart failure (CHF) Trial: The interim analysis for futility will be released by end of March’17. Since the trial is blinded, the DMC will look at the data on primary end point and provide their recommendation based on pre-specified thresholds. A positive recommendation to continue the trial as per protocol, will strengthen the partnering prospects of this asset and also allow MSB to make a prudent decision on continuing to make significant investment in this program. Positive results could also be the trigger for a partnership deal for the asset.

4. Top line results from MSC-100-IV for paediatric GvHD in US in 4QCY17. Following discussions with the FDA, MSB is running a 60 patient Phase III trial in paediatric GvHD patients. The trial is currently enrolling. Recent interim analysis for futility was successful. Top-line results are expected in 4QCY17.

5. Completion of enrolment in ongoing Phase III MPC-06-ID trial in chronic discogenic lower back pain (CLBP): MSB expects to complete enrolment in the first Phase III trial for CLBP in 2HCY17.

6. Results from Phase IIb trial in end stage Heart Failure patients requiring LVAD with MPC-150-IM: The US National Institutes of Health (NIH) run and funded Phase IIb end stage HF trial is expected to yield results in 4QCY17. • Potential positive conclusion of negotiations with Mallinckrodt and a partnering deal for MSB’s chronic discogenic lower back pain product and GVHD product: MSB continues to be in advanced partnering discussions with Mallinckrodt under its equity purchase agreement signed in December’16. Mallinckrodt has exclusive rights to negotiate on the back pain and GvHD products (Ex Japan and China) till end of September 2017. We believe it is highly likely that a commercial deal between the two companies could materialise before the end of June 2017 (2QCY17) and understand that MSB may not release any interim data from the back pain trial to the market while it is in such discussions.

7. Potential partnering deal for any of MSB’s products for Japanese Market: We expect to see licensing interest building towards MSB’s products for the Japanese market. Our belief is based on the growing interest of pharma companies in Japan towards regenerative medicine, the pro-regulatory environment allowing an expedited path to commercialization and nearer term revenues, the size of the market and high demand for treatments for diseases applicable to an ageing population. MSB’s MPC- 150-IM CHF product and MPC-300-IV product targeting inflammatory indications including Rheumatoid Arthritis are likely lead candidates for partnering in Japan. Ideally MSB would look to partner with a single company for a suite of its advanced products that may be approvable under the conditional pathway in Japan.