Mesoblast

AU: MSB

AU$1445.5m market cap

AU$2.46 last close

Mesoblast is developing adult stem-cell therapies based on its proprietary MPC and MSC platforms. Its lead programs are in pediatric aGvHD, heart failure, ARDS and lower back pain all of which are in Phase III or later.

Investment summary

Mesoblast announced that Novartis has signed a partnership with the company to develop remestemcel-L for acute respiratory distress syndrome (ARDS), whether or not the ARDS was caused by COVID-19. This is an important validation of both the platform as well as its application in the treatment of respiratory disease. Novartis will make a US$25m upfront payment and an additional US$25m equity investment. Mesoblast may receive a total of US$505m in development milestones, an additional US$750m in sales milestones and tiered double-digit royalties. Additionally, Novartis will fully fund global clinical development for all-cause ARDS and potentially other respiratory indications. The Phase III in COVID-19 related ARDS is expected to complete in Q1 CY21 with an interim analysis expected in December.

Y/E Jun
Revenue (US$m)
EBITDA (US$m)
PBT (US$m)
EPS (fd) (c)
P/E (x)
P/CF (x)
2019A 16.0 (75.4) (86.5) (15.69) N/A N/A
2020A 31.6 (64.8) (79.6) (13.28) N/A N/A
2021E 72.9 (46.3) (60.4) (10.29) N/A N/A
2022E 8.6 (83.2) (92.8) (15.83) N/A N/A
Industry outlook

Mesoblast is a leading mesenchymal stem cell company based in Australia. It has a manufacturing alliance with Lonza. JCR Pharmaceuticals markets Mesoblast’s GvHD therapy in Japan; FY19 royalties were US$5.0m.

Last updated on 21/01/2021
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Sector
Healthcare
Share price graph
Balance sheet
Forecast net cash (US$m) 59.7
Forecast gearing ratio (%) N/A
Price performance
%
1m
3m
12m
Actual 7.0 (24.3) (6.8)
Relative* 4.1 (31.8) (5.9)
52-week high/low A$5.5/A$1.1
*% relative to local index
Key management
Josh Muntner CFO
Silviu Itescu Chief Executive Officer & Managing Director