Why Mesoblast Stock Is Blasting Off Today
Shares of Mesoblast (NASDAQ: MESO) were soaring 19.8% higher as of 11:09 a.m. EST on Friday. The big jump came after the company announced an exclusive license and collaboration deal with Novartis (NYSE: NVS) for Mesoblast's lead pipeline candidate remestemcel-L. The initial focus of the two companies' collaboration will target the treatment of acute respiratory distress syndrome (ARDS), a condition where fluid builds up in the lungs.
There's a good reason why investors are so excited about Mesoblast's collaboration with Novartis. The big drugmaker will fork over $50 million upfront, including buying $25 million worth of Mesoblast's shares. Mesoblast will be eligible to receive up to $505 million in milestones related to ARDS indications. In addition, the biotech could receive post-commercialization milestone payments of up to $750 million along with tiered double-digit royalties on product sales of remestemcel-L if it makes it to market as a treatment for ARDS indications.
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Source Fool.com
