Ahead of the Bell: Osiris sells Prochymal

Published on NewsOK Modified: October 11, 2013 at 8:14 am •  Published: October 11, 2013

NEW YORK (AP) — Osiris Therapeutics shares rose Friday morning after the company said it is selling some of its stem cell therapy technology, including its transplant treatment Prochymal, to Mesoblast Ltd. in a deal that could be worth more than $100 million.

Prochymal treats bone marrow transplant cells that attack the recipient's body, and it is approved in Canada and New Zealand but isn't being sold. Osiris said it wants to focus on businesses with the greatest commercial potential. Its remaining products include Grafix, which is used to treat chronic and acute wounds, Ovation, which is used in tissue repair, and Cartiform, a treatment for acute cartilage injury.

Shares of Osiris Therapeutics gained $1.42, or 8.3 percent, to $18.55 in premarket trading.

Osiris said it had about $12.5 million in costs related to Prochymal over the last year.

Osiris will get $50 million upfront from Mesoblast, which is based in Australia, and could get another $50 million based on development and regulatory review of therapies that use culture-expanded mesenchymal stem cells. Osiris said $35 million of the upfront payment will be made in cash. It will get $15 million more when the assets are delivered to Mesoblast.

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