Why the Mesoblast (ASX:MSB) share price is charging higher today

The Mesoblast limited (ASX:MSB) share price is pushing higher on Monday after providing an update on its remestemcel-L for the treatment of SR-aGVHD…

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The Mesoblast limited (ASX: MSB) share price has started the week strongly and is charging higher.

In early trade the allogeneic cellular medicines company's shares are up 3% to $4.45.

Why is the Mesoblast share price pushing higher?

Investors have been buying the company's shares this morning after its revealed results from a study of its remestemcel-L product in children with steroid-refractory acute graft versus host disease (SR-aGVHD).

According to the release, the results provide in vivo biomarker evidence linking remestemcel-L's immunomodulatory activity to survival outcomes in children with SR-aGVHD.

Management advised that the study found that clinically meaningful overall responses and survival in children with SR-aGVHD treated with remestemcel-L were associated with significant reductions in certain biomarkers of inflammation which have been validated as predictors of mortality risk.

These biomarkers provide evidence of in vivo bioactivity of remestemcel-L in paediatric SRaGVHD, where children under 12 are at high-risk for mortality, with no approved therapies in the United States.

Furthermore, the durable reductions in blood levels of certain biomarkers associated with inflammatory diseases of the gut suggest that these could be more generally reflective of remestemcel-L activity in vivo in other inflammatory bowel diseases, such as Crohn's disease and ulcerative colitis.

The phase 3 trial's lead investigator and paediatric transplant physician, Dr Kurtzberg, commented: "These results support the bioactivity of remestemcel-L in treating the severe inflammation in children with acute graft versus host disease refractory to steroids and provide evidence linking the immunomodulatory properties of remestemcel-L with the excellent responses and survival we see when treating these desperately ill children."

Judging by the share price reaction, investors may be optimistic that this data will support its push to get the treatment approved by the US Food & Drug Administration.

The Mesoblast share price crashed lower in October after the regulator didn't approve the treatment and instead requested that the company undertakes at least one additional randomised, controlled study in adults and/or children. This is to provide further evidence of the effectiveness of remestemcel-L for SR-aGVHD.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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