The move was announced by Mesoblast, after its therapy candidate, remestemcel-L, missed its primary endpoint in a Phase III trial. Remestemcel-L is being explored as a potential treatment for acute respiratory distress syndrome (ARDS) due to COVID-19.
In a statement, Mesoblast outlined that it considered the observed mortality reduction in patients in trials to be ‘sufficiently strong’ to continue development of the drug. The company stated that it is currently preparing a pivotal Phase III trial to support an application for Emergency Use Authorization (EUA).
In the short term, however, it means that Mesoblast will miss out on a $25m (€22.5m) upfront payment and a $25m equity investment that were agreed by Novartis, subject to the closing of the deal.
As the deal was terminated prior to its closing, Novartis is no longer obliged to make the payments. The initial deal was agreed late last year, as the pharma giant made several such moves to potentially bring a COVID-19 vaccine or treatment into its portfolio.
In terms of plans going forward for the drug, a spokesperson for Mesoblast told BioPharma-Reporter that the company has “ongoing discussions with numerous potential pharma partners across its program, including remestemcel-L for respiratory indications.”
Mesoblast has also met with the the US Food and Drug Administration (FDA) in regard to a potential EUA, with the agency telling the company that an additional statistically positive clinical study ‘might be sufficient’ to support the application.
The next steps are to agree with the FDA the final protocol and potency assay, the spokesperson added.
Troubled path to commercialization
The decision by Novartis adds further difficulty in Mesoblast’s efforts to commercialize remestemcel-L, which suffered rejection by the FDA for a different indication last year, despite the drug being recommended for approval by the agency’s advisory committee.
Mesoblast was seeking approval for the treatment for pediatric steroid-refractory acute graft versus host disease. However, the FDA stated that it would need at least one more randomized controlled study before reconsidering approval.
The company’s spokesperson outlined that it is still in discussions with the FDA’s Office of tissues and Advanced Therapies “to address the appropriateness of potency assays related to remestemcel-L’s proposed anti-inflammatory mechanism with the goal of resubmission of the Biologics License Application.”
In this indication, the spokesperson stated that Mesoblast has no need of a partner, as it has the capacity to manage the potential commercialization process by itself.