A great post from Vincent D
Hope it gives some comfort under theSP drop today – bloody profit takers !!
The Novartis deal is fantastic news for Mesoblast shareholders.
Some of the reactions on this amazeme.
To all those who are trying to read something into it regarding the CHF or LBP trials, to those who are disappointed by the terms of the deal, to those who “predicted” the deal, and conversely tot hose “totally surprised” by it... it might be good to review some history.
This deal didn't happen overnight, infact, there's reason to believe management was contemplating a partnership with big Pharma starting day 1 when they boldly announced plans to enter the C-19ARDS space back in March.How can we know that? Well, by May the company was making this“subtle” disclosure in its quarterly filings: “Mesoblast is in ACTIVE discussions with potential pharmaceutical partners with respect to its plansf or ramp-up of commercial manufacturing for remestemcel-L in COVID-19 ARDS.2”.(emphasis added).
So, surprise, surprise. Going after the ARDS market, which is many multiples of the childhood aGVHD market, I think we can say the company would have been remiss NOT to partner. No way as mall biotech taking on the disease of the century could have handled a rollout to all the ICU's of the nation going it alone. A deal of this nature has been in the works for some time independent of what happens with CHF or LBP or Crohn's or any other indication.
Are the terms of the deal fair?
SI clarified that issue very well atthe AGM the other day the deal has a potential value of 1.3B USD + double-digit royalties on sales + the potential to expand, and it's the second largest deal (this year?) in all of Australia business, and it must be judged in terms of the strengths $200B market cap partner Novartis brings to the table.
Among which are yes, marketing capacity, but also regulatory muscle, ie the ability and know-how to get a BLAon a cell-based therapeutic over the FDA finish line.
Novartis knows how to do that where -let's face it - Mesoblast had a stumble. For whatever reason you want to name:corrupt FDA, QC issues, insufficient data... whatever. The fact that Novartisindeed CHOSE Mesoblast when they had other options out there, should put tobed the scalability and manufacturing issues the likes of CavScout keep harping on.
You think $50M up front is too thin? how would you feel if the deal had gone to ATHX with Mesoblast left sitting alone facing a stubborn FDA and awaiting unknown C-19/CHF/LBP results ???We'd be in the shit,don'tbe greedy, this is a great deal for us, look at the ATHX boardtheir shareholders are watching a train wreck on their board of directors and like all things ATHX it's a slow moving trainwreck (that most of them are misreading). Count your blessings.
We will be moving in the righ tdirection and l can’t wait for the P3 announcements.
Hang tuff Mesoblasters,
ST
(20min delay)