...when AFR carries an adverse article about any company, you better listen up. AFR did question MSB's conduct.
Biotech is a "hero or zero" sector, but the trouble with biotech is that when their results are not statistically significant , the company would more likely couch its statements to understate the negativity, they usually say they will try something else, a tweak or change. To keep hopes up.
Gold discovery with junior gold stocks is IMO a better play. Gold juniors have many advantages over biotech stocks- news flow more frequent, gold price move can help with sentiment, upside more significant because their market cap usually very low, if there is gold there is gold, biotech drugs subject to lengthy regulatory approvals and to be truly honest, the chances of success is far lower than most of us would love to imagine.
With biotech companies especially those with a single or two discoveries, a failure in one or both can be doomsday for the company. For gold juniors, they can explore new territories, and the worst possible scenario is more capital raising and dilution but at least they are underpinned by favourable macro outlook for the gold sector going forwards.
Mesoblast faces multiple class action lawsuits in the US Tom Richardson and Carrie LaFrenz
Oct 20, 2020 – 4.21pm
On October 8, Bragar Eagel & Squire, a shareholder rights law firm with offices in New York and California, filed a class action lawsuit in a US District Court on behalf of investors that purchased Mesoblast securities between April 16, 2019 and October 1, 2020.
Corporate litigation boutique, Bronstein, Gewirtz & Grossman LLC, which has offices in New York, New Jersey, and Los Angeles, also filed a suit against the biotech on behalf of investors who bought shares in the same time frame.
Mesoblast chief executive Silviu Itescu has been named as a defendant in a US law firm's claims the company misled investors. Arsineh Houspian
According to US court documents, this class action seeks to recover damages against Mesoblast, and names chief executive Silviu Itescu and chief financial officer Josh Muntner as defendants.
"Because of their positions, and access to material non-public information available to them, the individual defendants knew that the adverse facts specified herein had not been disclosed to, and were being concealed from, the public, and that the positive representations which were being made were then materially false and/or misleading," the claim alleges. "The individual defendants are liable for the false statements pleaded herein."
Other US legal firms chasing the $2 billion biotech include Schall Law and Rosen Law Firm.
Remestemcel-L, marketed under the Ryoncil label, is the stem cell company's top drug candidate to treat a life-threatening inflammatory condition in children, called acute-Graft Versus Host Disease (aGVHD).
In February 2018, Mesoblast announced that Remestemcel-L met its primary endpoint in a phase three trial to treat children with aGVHD.
Mesoblast completed its application with the FDA to secure marketing authorisation to commercialise Ryoncil for children suffering from the disease following a bone marrow transplant in early 2020. The application was supported by Mesoblast's own trials into the drugs that did not include a placebo or control group, contrary to a prior trial. Stunned shareholders
However, the FDA stunned Mesoblast's shareholders on September 30 by rejecting the application and demanding Mesoblast conduct an additional placebo-controlled trial into the treatment's effectiveness.
Lawyers at Bronstein, Gewirtz & Grossman now allege Mesoblast violated federal securities laws under the Securities Exchange Act in failing to disclose materially adverse facts related to prior trials of the drug.
The litigators claim that comparisons between Mesoblast’s own trial results submitted to the FDA and three historical studies did not support the effectiveness of Remestemcel-L due to design differences between the studies.
The FDA has also dismissed shareholder complaints that the only member of its ODAC advisory committee to vote against the treatment, Christian Hinrichs, was conflicted or failed to declare a conflict due to being the registered patent holder of a potentially competing aGVHD therapy named interleukin-15.
An FDA spokesperson said the ODAC meeting's members were screened for financial conflicts of interest.
"FDA determined that the members and temporary voting members were in compliance with federal ethics and conflict of interest laws," the spokesperson said.
Mesoblast's key institutional supporter and broker Bell Potter has maintained a $7 "speculative" price target on shares and called the FDA's rejection "totally unexpected". Contrary to the circling US law firms, the broker argued the FDA completely disregarded the ODAC panel's strong vote in favour.
Mesoblast has not responded to a request for comment over the lawyers' claims that it misled the investment community about the likelihood of FDA approval given the past weaknesses in trials including those referenced by Dr Hinrichs. Since its inception, the biotech has accumulated losses of $US548.8 million in its attempts to commercialise stem cell science.
