What happened?

Shares of Mesoblast Limited (NASDAQ:MESO) are rising sharply on Friday after the company reported positive results from a clinical trial for one of its pipeline candidates, remestemcel-L. The biotech's stock was up 7.3% as of 3:22 p.m. EDT, after soaring by as much as 24.5% earlier in today's trading session.

So what

In a clinical trial investigating the efficacy of remestemcel-L in ventilator-dependent COVID-19 patients with moderate to severe acute respiratory distress syndrome (ARDS), the medicine was shown to reduce mortality by 46% in patients under the age of 65 through day 60, but not in those aged 65 and older. When combined with dexamethasone, remestemcel-L reduced mortality by 75% and increased ventilation-free days in patients under the age of 65 through day 60, compared to those treated with dexamethasone alone.

Illustration of a microscopic view of coronavirus particles

Image source: Getty Images.

Mesoblast CEO Silviu Itescu said, "Reduction in mortality in mechanically ventilated patients under 65 years old remains a critical unmet need since as many as 72% of currently hospitalized patients across the US with COVID-19 are in this age category." With these results in its back pocket, the biotech company plans to discuss a potential path toward regulatory approval or emergency use authorization (EUA) for remestemcel-L with the U.S. Food and Drug Administration.

Now what

Remestemcel-L could provide an immediate boost to Mesoblast's financial results if it earns EUA. The company does have other promising pipeline candidates, too. Earlier this year, it announced positive results from a phase 3 clinical trial for rexlemestrocel-L in treating patients with chronic low back pain due to degenerative disc disease. Thanks to these results, Mesoblast boasts several short-term catalysts that could send its stock price even higher, which means it might be worth it to keep an eye on this company in the coming months.

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