The Mesoblast limited (ASX: MSB) share price was out of action on Thursday and missed out on the S&P/ASX 200 Index (ASX: XJO) rebound following a trading halt request prior to the market open.
Why is the Mesoblast share price in a trading halt?
This morning the biotech company requested a trading halt pending the release of an announcement.
That announcement relates to the United States Food and Drug Administration's review of its Biologics License Application for RYONCIL (remestemcel-L). Mesoblast is seeking approval for its use in treating paediatric patients with steroid-refractory acute graft versus host disease (SR-aGvHD).
The United States Food and Drug Administration gave its priority review date of 30 September but appears to be either behind schedule or taking its time with the review.
Priority reviews are given to drugs treating serious conditions with the potential to provide significant improvements in safety or effectiveness over existing therapies. They traditionally cut the time in which the administration aims to take action on a drug's application from ten months to six.
What are the chances of success?
Going into the review, Mesoblast was well-placed to gain approval thanks to its meeting with the Oncologic Drugs Advisory Committee of the Food and Drug Administration in August.
At the meeting, the Committee voted overwhelmingly (9 to 1) in favour that the available data supports the efficacy of remestemcel-L in paediatric patients with SR-aGvHD.
This was a big win the company, as the ODAC plays a key role in whether certain drugs get approval or not. Failure to gain the support of the ODAC would make it almost impossible to then gain FDA approval.
What now?
Mesoblast requested that the trading halt continues until it makes its announcement. This is expected to be on Monday 5 October 2020.
This could be an indication that it expects the Food and Drug Administration to make its decision on Friday night (Australian time).
