Ann: Update on BLA for Graft Versus Host Disease, page-696

Unfortunately I do not see any rabbits in hats for MSB in the near future @LearningEachDay …. I think they are in one of the most vulnerable positions they have ever been in after Friday and we of course know they didn’t hedge by securing and announcing a partnership prior to the PDUFA date for CHF or CLBP

ALL these partnership discussions we have been told about over the last 12-18 months IMO just sent SI a revised submission with a 50% haircut on Friday afternoon and any of the bigger players that saw anything they even remotely liked while they looked under the hood through their NDA’s (now or in the past) probably opted for a different path on Friday - takeover of everything rather than (now) what would seem an expensive piece of the pie for only one indication.


Mesoblast offers the following benefits (to name a few - there are others) to any big pharma who wants a decent footprint in the MSC sector with a great head start:

1. Huge Global Patent Portfolio
2. Multiple late stage Phase 3 assets even though more trials are required
3. Large amount of clinical data / results
4. Accumulated losses of > $900 million
5. Possible Remestemcel-L FDA AA in paediatrics within. 3-6 months (45 days is a pipe dream)
6. Possible Rexlemestrocel-L AA for CHF in a restricted cohort
7. Possible Takeda USA Alofisel License fee / Royalties in 6-12 months if FDA approve it
8. Ongoing global patent infringement license fees


IMHO any big pharma who were already interested in Mesoblast would have been keeping a very close eye on this PDUFA date / FDA decision …. They would have been ready to act on either result but once the rejection was issued they were probably salivating ? There was then nothing stopping them buying 4.99% of the company on market on Friday for circa 50cps.


There were approximately 128,000,000 million shares or 16% of SOI traded on Friday between the ASX and the Daq and while most shorts would have covered that still leaves about 90 million shares unaccounted for … take out churn, bots etc and some retail and insto purchases and it easily enables a 4.99% / 40.269 million shares to be bought by a prospective suitor on market at circa 50cps … I can’t recall this opportunistic scenario being available to them previously … think about it - buying 40.269 million shares on market at around 50 cps - unheard of previously … in plain sight and in this scenario they remain under the radar as no ASX notice is required at this stage


Humor me - just imagine if the above scenario has unfolded on Friday …. come Monday they could keep buying but at that point they would trigger an ASX ‘Becoming a Substantial Holder Notice’ which would need to be submitted within 2 business days from Monday (so Wednesday) …. IMO watch the buying on Monday and Tuesday as people claim “it’s a dead cat bounce” or “it’s green today because it was oversold” while the on market buying steps up a notch by said big pharma group adding to their holding ?


If my theory is in play this big pharma isn’t going to care if they then push the share price to 80 or 90 cents by late Tuesday or Wednesday morning if they get to secure (say) 10, 15 or even up to 19.99% of Mesoblast for under $1 …. all bought on market in plain sight … something any CEO of a big pharma conglomerate in this sector could (once) only dream of and no one would even know about until Wednesday when they lodge the required ASX notice ?


From there they would probably only need to offer a half decent T/O price because they will have secured so many shares at such a huge discount and they would probably score another 10 or 20% in the lead up to the AGM or they could go the nuclear option and attempt to undertake a hostile takeover …. the blocking stakes from SI, Thorney, M&G and Gregory will prevent a full takeover sure but with a decent stake this big pharma will be the one really calling the shots, not SI & Co. and who knows a half decent offer could entice M&G or Thorney or both ? Thorney didn’t participate in the last CR so he could be willing to fold after Friday ? Who knows - but remember it’s all about making money after all ?


Another scenario could be that this big pharma just kept buying on Friday at depressed prices and surpassing the 5% threshold with the intent to continue on Monday and get what they can prior to them having to issue a notice on Tuesday … either scenario means they have a great head start to their proposed acquisition and they probably wouldn’t issue the notice until Tuesday afternoon so the6 could keep going Tuesday morning ?


Some on here will claim these scenarios are far fetched but hey there are smarter people than me working at these global pharma giants with MCs in the hundreds of billions of dollars and they need to move quickly to capitalise on this opportunity …. they won’t want SI & Co. gaining any momentum through the Type A meeting or by them lodging an AA BLA submission for paediatrics in the lead up to same. They also won’t want the ever elusive FDA CHF meeting to take place before making an offer IMO. The opportunity landed at their feet on Friday and they will have been ready IMO and will act very swiftly IF they were ever interested in a partnership for the blockbuster indications or Mesoblast as a whole ? If after Friday no big pharma is doing this, then we are in bigger hot water ?


… and finally I would say temper your expectations if a T/O does unfold because it will be at fire sale prices far from the lofty predictions that have been posted on these threads over the years - just sayin’


GLTAH and enjoy the weekend