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Angioblast Acquired by Mesoblast, (ASX: MSB; ADR: MBLTY)

Mesoblast is acquiring the outstanding shares of Angioblast Systems, a developer of mesenchymal precursor cells to position its marketing operation in 2012. The acquisition valued Angioblast at $222 M and gives Mesoblast a value of $405 M. Referencing our previous post, 5/10/10. 

MSB swapped its shares for the 67% of Angioblast it doesn’t already own. The Angioblast package comes with the IP to experimental therapies for diabetes, cardiovascular disease and eye disease, as well as a leukemia program. The acquisition enables MSB to focus on 3 simultaneous commercial strategies: taking lead products to market on our own and retaining 100% of the commercial upside, entering into distribution agreements to leverage sales/marketing strength, and partnering through broad-based strategic alliances.  

MSB, also announced it has completed a capital raising of $37 M to fund the acquisition and advance operations. These funds comprise $24 M invested immediately and $13 M committed subject to both shareholder approval and completion of the acquisition offer.

Angioblast’s lead program relies on mesenchymal precursor cells to articulate umbilical cord blood used in the bone marrow transplants needed by leukemia patients. But,  will a late-stage trial this year confirm the results of a small study involving 18 patients to effectively restore the white blood cells the body relies on to fight infections? Another therapy, Revascor, is designed to restore cardiovascular muscles in heart attack victims. Mesoblast estimated that Angioblast’s therapies could generate up to $500 M upon regulatory approval. (HWM and Bloomberg)