CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Please ensure you fully understand the risks involved. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Please ensure you fully understand the risks involved.

Quick take: Why Mesoblast has rallied 17% in the last 5 sessions

We unpack Mesoblast’s first quarter results in under 2 minutes.

Investors continued to bid Mesoblast (MSB) higher on Monday – with the stock up 6.59% to $3.88 by noon – building on the gains the company witnessed following the release of its Q1, FY21 update last Friday.

Mesoblast share price: Understanding what drove the rally in under 2 minutes

In particular, investors look enthused by the announcement of a global license and collaboration agreement between Novartis and Mesoblast. Under this agreement, it was noted that the companies would join forces to develop, 'manufacture and commercialization of Mesoblast’s mesenchymal stromal cell (MSC) product resentence-L.'

Commenting on this partnership, Mesoblast's CEO, Dr Silviu Itescu, said 'Our collaboration with Novartis will help ensure that remestemcel-L could become available to the many patients suffering from ARDS, the principal cause of mortality in COVID-19 infection.'

Despite renewed investor confidence, MSB posted Q1 revenues of just US$1.3 million, down significantly from Q1 FY20 revenues of US$17.0 million.

Research and development and manufacturing expenses also rose during the quarter, increasing by US$6.9 million and US$9.2 million, respectively. Increased research and development costs were driven by 'increased clinical trial costs relating to the Phase 3 trial for COVID-19 ARDS, non-cash share-based payments to employees and consultants and pre-commercial activities for remestemcel-L,' the company said.

Overall, these results culminated in MSB reporting a post-tax Q1 loss of US$24.5 million.

Despite that loss, investors appear particularly pleased with the Novartis partnership; the stock, after all, was bid 16.2% higher during last Friday’s session.

Want to take a position in Mesoblast – long or short?

Create an IG trading account or log in to your existing account to get started now.

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

Seize a share opportunity today

Go long or short on thousands of international stocks.

  • Increase your market exposure with leverage
  • Get commission from just 0.08% on major global shares
  • Trade CFDs straight into order books with direct market access

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

Prices above are subject to our website terms and agreements. All share prices are delayed by at least 20 minutes. Prices are indicative only.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.