Australian biotech Mesoblast sank 35% on Tuesday ahead of this week’s US Federal Drug Administration (FDA) committee meeting, which will assess the efficacy of its flagship stem cell therapy candidate.The stock dived to $11.33 at the close on Tuesday and is currently down 1.9% in pre-market trading. Mesoblast (MESO) disclosed that the FDA’s Oncologic Drugs Advisory Committee (ODAC) will meet on Thursday to review data supporting its Biologics License Application (BLA) for the approval of its stem cell candidate remestemcel-L for the treatment of steroid-refractory acute graft versus host disease (SR-aGVHD) in children, a severe immune response which can occur after a bone marrow transplant.There are currently no FDA-approved treatments in the US for children under 12 with SR-aGVHD, a potentially life-threatening complication of an allogeneic bone marrow transplant for blood cancer. The stem cell therapy candidate is also currently being studied in the US as a treatment for COVID-19 patients suffering from acute respiratory distress.The ODAC will vote in the afternoon session on Aug. 13 whether the available data support the efficacy of remestemcel-L in pediatric patients with SR-aGVHD. The session will discuss the Phase 3 trial results and supporting clinical data included in the BLA. It will also discuss issues related to the characterization and critical quality attributes of remestemcel-L.The ODAC is an independent panel of experts that provides advice and recommendations based on potential issues highlighted by the FDA during their review of the efficacy and safety of marketed and investigational products for use in the treatment of cancer. One of the issues raised by the FDA is whether more evidence is needed to demonstrate the treatment delivers benefits to human patients.Although the FDA will consider the recommendation of the advisory committee, the final decision regarding the approval of the product is made by the FDA solely, and the recommendations by the panel are non-binding. The FDA is scheduled to make a decision on the application on Sept. 30.H.C. Wainwright analyst Swayampakula Ramakanth believes that the treatment is likely to be approved before the Sept. 30 deadline “due to a strong combination of safety and efficacy” adding that “the main issues raised by the FDA are addressable”.“Taking into consideration the FDA’s analyses, we believe the benefit of Ryoncil for pediatric patients with SR-aGVHD continue to significantly outweigh its risks,” Ramakanth wrote in a note to investors. “At the same time, we note that the agency could request the company to complete a post-marketing study in order to provide additional data.”Nonetheless, Ramakanth reiterated a Buy on Mesoblast along with a $21 price target, which implies potential upside of 85% from current levels. (See Mesoblast stock analysis on TipRanks)Overall MESO scores 5 unanimous Buy ratings from analysts which add up to a Strong Buy consensus. Despite the stock’s 54% rally this year, the $18.05 average price target still indicates 59% upside potential.Related News: Pfizer Inks Deal To Manufacture Gilead’s Covid-19 Remdesivir Treatment Inovio To Start P2/3 Study Of Covid-19 Candidate In Sept.; Shares Drop 8% Novavax Rises 5% On Earnings; $2B Covid-19 Vaccine Funding More recent articles from Smarter Analyst: * Eli Lilly, Innovent’s TYVYT Expanded Use Application Accepted In China * ASOS: ‘100% Profit Beat’ Cheers RBC Capital On Trading Update * Truist Securities Ramps Up Wayfair’s PT On Improving Profitability * Equinix Enters India With $161M GPX Global Deal; RBC Bullish