Multi Gene Vascular Systems Ltd. in advanced talks with Australian stem cell co. Mesoblast Ltd.
Mesoblast would commercialize MGVS's leading product, a cell-based therapy for the treatment of peripheral artery disease.
Multi Gene Vascular Systems Ltd. is advanced talks with Australian stem cell company Mesoblast Ltd. (ASX: MSB) to commercialize MGVS's leading product, MultiGeneAngio, a cell-based therapy for the treatment of peripheral artery disease and blocked arteries in the leg.
MGVS declined to comment on the report.
Earlier this year, Teva Pharmaceutical Industries Ltd. (NYSE: TEVA) cancelled its development agreement with MGVS as part of Teva's strategic review. Teva invested $9 million in MGVS at a company value of $135 million in early 2012, and promised to finance the tens of millions of dollars for clinical trials of MultiGeneAngio, in exchange for commercial rights and an option to make an additional investment in the company or even acquire it outright. Mesoblast is now stepping into Teva's shoes.
Under the pending deal, Mesoblast promises to finance clinical trials for MultiGeneAngio under milestone payments and royalties amounting to tens of millions of dollars in exchange for commercial rights to the product. The deal may not include investment in MGVS.
Mesoblast, which has a market cap of AU$2 billion on the Australian Stock Exchange, develops therapies based on adult stem cells, a business that is synergetic with MGVS. In December 2010, Mesoblast signed an agreement with Cephalon to develop stem cell therapies for heart attacks, Parkinson's disease, and strokes. Teva's acquisition of Cephalon made it the largest shareholder in Mesoblast, and the agreement with Cephalon was not cancelled despite the changes at Teva. If Mesoblast signs the agreement with MGVS, its link with Teva will be reestablished.
MGVS was founded in 2000 by president and acting CEO Prof. Moshe Flugelman and Dr. Basil Lewis. It has raised $27 million to date from DFJ Tamir Fishman Ventures Ltd., Ofer Hi Tech Ltd., Aviv Venture Capital, and private investors, including Eitan Wertheimer. The company's leading products MultiGeneAngio and MultiGeneGraft are undergoing clinical trials.