Around midday today shares of bio-therapeutics company, Mesoblast limited (ASX: MSB), soared 24% higher following an ASX announcement this morning.
In a market sensitive media release, Mesoblast said it had entered into an agreement with US-based global biopharmaceutical giant, Celgene Corporation. Celgene is engaged in the development and commercialisation of therapies for cancer and immune-inflammatory related diseases.
Under the agreement, Celgene will purchase 15.3 million shares in Mesoblast, for a total consideration of $58.5 million equating to a price of roughly $3.82 per share.
In addition, Mesoblast said: "Celgene has a six-month right of first refusal with respect to Mesoblast's proprietary mesenchymal lineage adult stem cell product candidates for the prevention and treatment of acute graft versus host disease (GVHD), certain oncologic diseases, inflammatory bowel diseases, and organ transplant rejection."
Mesoblast CEO, Silviu Itescu, said the company looks forward to working with Celgene on innovative therapies for oncologic and immune-related diseases. "We look forward to working closely together and building a strong and fruitful relationship," Dr Itescu said.
Today's announcement follows the allowance of a key patent to be used by Mesoblast in Japan for the treatment of heart disease, stroke and other vascular conditions.
Despite the recent batch of good news, however, shares of Mesoblast have been sold down 19% during the past year, compared to a 10% return from the S&P/ASX200 (Index: ^AXJO) (ASX: XJO).
