The Mesoblast Limited (ASX: MSB) share price has had a hard time of it lately. Its struggles seem to have been born from a 17% single-day plunge last month, from which the company – whose stock is also listed on the Nasdaq exchange under the ticker NASDAQ: MESO – hasn't yet managed to recover.
In early morning trade on Wednesday, the Mesoblast share price is $1.36. That's 20% lower than it was this time last month.
Let's take a look at what's been weighing on the biotechnology company recently.
What's dragging the Mesoblast share price lower?
The Mesoblast share price has been feeling down since it announced a Swiss healthcare company dumped its product in mid-December.
Novartis terminated an agreement that could have seen Mesoblast's remestemcel-L used to treat COVID-19-induced acute respiratory distress syndrome (ARDS).
As The Motley Fool noted at the time, the agreement's cancellation saw around US$1.2 billion of Mesoblast's potential earnings washed down the drain.
Of course, the agreement's termination might have been expected by some.
It was put in place less than a month before Mesoblast released news its randomised control trial treating ventilator-dependent patients with ARDS due to COVID-19 was called off early after it became apparent it was unlikely to meet its primary endpoint.
The Mesoblast share price recovered some of its losses on 16 December. That's when the company released positive news of a trial using remestemcel-L to treat chronic back pain.
Its shares gained 11% that day, but they didn't manage to hold onto the boost.
In fact, the Mesoblast share price has already shed 3.55% year to date. It's also 47% lower than it was this time last year.
On top that that, Mesoblast remains one of the most shorted stocks on the ASX. The Motley Fool's most recent weekly breakdown of shorting found 9.1% of the company's shares were in the hands of short sellers.
