Coronavirus: Mesoblast up 36% on hopes for new COVID-19 trial

Billionaire-backed biotech Mesoblast’s shares soared after it announced it was stepping up its fight against COVID-19 with a new stem cell treatment.

Mesoblast says research to test developments that could aid in the fight against the COVID-19 coronavirus could be tested in the US. Picture: iStock

Australian biotech Mesoblast’s shares have rocketed up more than 30 per cent after the company announced it was stepping up its fight against coronavirus, with its new stem cell treatment ready to be tested on people battling severe complications from COVID-19.

The Anthony Pratt and Thorney Investment-backed company announced on Thursday it would begin a clinical trial in the US, with the support of the National Institutes of Health, to test whether its new therapy can fight a potentially lethal immune reaction resulting from coronavirus.

Investors lapped up the news, sending the company’s shares up 36 per cent, or 66.5c to $2.50 on Thursday.

The trial will involve 240 patients who have developed acute respiratory distress syndrome (ARDS) as a result of a COVID-19 infection.

Mesoblast chief medical officer Fred Grossman said the death rate in moderate to severe ARDS cases was as high as 80 per cent, highlighting the need for a treatment to combat the condition.

Mesoblast CEO Silviu Itescu. Picture: Stuart McEvoy

To date, COVID-19 has killed more than 88,000 people and infected 1.5 million others worldwide.

ARDS occurs due to an excessive immune response that occurs when COVID-19 infects the lungs. Immune cells secrete inflammatory cytokines to fight the virus but those cytokines can destroy lung tissue and damage other organs, including the liver, kidneys and heart.

Dr Grossman said Mesoblast’s treatment, called Remestemcel-L, was developed to counteract inflammation by increasing the production of naturally occurring anti-inflammatory cells to help people fight ARDS.

Mesoblast has already successfully used the treatment on children who developed a similar deadly immune reaction called acute graph versus host disease (aGVHD).

“Remestemcel-L has demonstrated safety, efficacy and significant survival benefit in aGVHD where inflammation is at the core, similar to ARDS from COVID-19.” Dr Grossman said.

“The mechanism of action of remestemcel-L demonstrated in aGVHD supports the evaluation of remestemcel-L to safely tame a similar cytokine storm in the lungs that leads to the high mortality in patients with COVID-19.”

Mesoblast will test its cell therapy at more than 20 medical centres across the US, which are part of the Cardiothoracic Surgical Trials Network, an initiative of the US National Institutes of Health.

Mesoblast chief executive Dr Silviu Itescu said: “This significant public-private partnership is a prime example of how the combined resources of industry and government can be leveraged to evaluate in a most efficient and rigorous manner the potential of innovative therapies to make a meaningful difference to patient outcomes.”

Cardiothoracic Surgical Trials Network chairman Marc Gillinov said the partnership with Mesoblast was part of the network’s mandate to “rigorously evaluate” therapies to treat severe conditions, such as COVID-19 related complications.

“We are excited to work with Mesoblast to make a real impact on the high mortality associated with COVID-19,” Dr Gillinov said.

International clinical studies highlighting the potential to use stem cell injections to treat coronavirus could become a boon for company, which Alex Waislitz’s Thorney Investment Group owns 6 per cent, while the stem cell developer is the only listed company stock owned by his brother-in-law, paper and packaging magnate Anthony Pratt.

In addition to the US trial, three clinical studies in China are investigating the potential use of umbilical cord stem cells to treat patients infected with coronavirus, forming part of the global effort on developing medical products and vaccines to combat the pandemic.