Australian biotech Mesoblast has plummeted on the ASX after US health authorities did not approve its therapy to treat a rare disease which affects blood cancer patients.
The US Food and Drug Administration has asked the company for at least one more study that shows its therapy, called remestemcel-L, can treat steroid-refractory acute graft versus host disease.
The decision caused shares to fall by 33.66 per cent to $3.70 at 1143 AEST.
Shares have been as high as $5.70 this year.
Management had been hopeful of approval after a US government committee in August voted nine to one for the therapy.
Mesoblast said it will ask to discuss accelerated approval with health officials.
Approval would be lucrative as the US has no therapy for children under 12 years with the condition.
Mesoblast is developing the same cell therapy to treat people with respiratory problems from COVID-19.
Acute respiratory distress syndrome is the main cause of death for people infected with the virus, according to Mesoblast.
Up to 300 adults with COVID-19, who are on ventilators, are using the cell therapy in trials.