Mesoblast Operational and Financial Highlights for Quarter Ended September 30, 2022

Quarterly Activity Report

NEW YORK, Oct. 30, 2022 (GLOBE NEWSWIRE) -- Mesoblast Limited (Nasdaq:MESO; ASX:MSB), global leader in allogeneic cellular medicines for inflammatory diseases, today provided an activity report for the fourth quarter ended September 30, 2022.

Financial Highlights

• Net cash usage for operating activities in the quarter was US$14.3 million; this represented a reduction of US$3.9 million, or 22%, on the comparative quarter in FY2022, and a reduction of $US8.0 million, or 47%, on the comparative quarter in FY2021.1

• Cash on hand at the end of the quarter was US$85.5 million after raising gross proceeds of US$45 million in a private placement in August 2022, with up to an additional US$40 million available to be drawn down from existing financing facilities subject to certain milestones.

Pipeline: Remestemcel-L

Biologics License Application (BLA) resubmission to the US Food and Drug Administration (FDA) for the treatment of children with steroid-refractory graft versus host disease (SR-aGVHD)

• A major milestone in the Company’s complete response to the FDA was the submission at the end of the quarter of substantial new information on clinical and potency assay items to the Investigational New Drug (IND) file for remestemcel-L in the treatment of children with SR-aGVHD, as guided by FDA.

• Survival outcomes have not improved over the past two decades for children or adults with the most severe forms of SR-aGVHD.2-4 The lack of any approved treatments for children under 12 means that there is an urgent need for a therapy that improves the dismal survival outcomes in children.
• Remestemcel-L treatment has shown improved 6-month survival in children with severe SR-aGVHD in comparison to contemporaneous controls treated with best available therapy.
• Mesoblast has optimized a potency assay that was in place at the time of the 54-patient Phase 3 trial in children with SR-aGVHD and which demonstrates a relationship between the product’s activity in vitro and its effects on survival in the Phase 3 trial
• Additionally, Mesoblast has now generated data from the expanded access program (EAP 275) of 241 children which confirm the ability of the in-vitro potency assay to measure product activity relevant to survival outcomes.
• Remestemcel-L has been granted Fast Track Designation and BLA Priority Review from the FDA.

Pipeline: Rexlemestrocel-L

Chronic low back pain associated with degenerative disc disease

• Mesoblast gained alignment with the FDA on key metrics for pivotal Phase 3 study in patients with CLBP which seeks to replicate the significant reduction in pain seen at 12 and 24 months in first Phase 3 trial.
• FDA has confirmed that reduction in pain is approvable indication.

• The Company plans to have clearance from the FDA by year-end 2022 for the pivotal trial with primary endpoint 12-month reduction in pain.
  

Chronic heart failure with reduced ejection fraction (HFrEF) in NYHA class II/III patients through to end-stage III/IV patients with a left ventricular assist device (LVAD)

• Recent data from Phase 3 trial of 565 patients with HFrEF showed a single intervention with rexlemestrocel-L improves left ventricular ejection fraction (LVEF) at 12 months, preceding long term reduction in major adverse cardiovascular events (MACE).
• LVEF improvement at 12 months may be an appropriate early surrogate endpoint for long term reduction in MACE.
• Results from three randomized controlled trials in class II/III HFrEF and in end-stage HFrEF with left ventricular assist devices (LVADs) support the idea of a common mechanism of action (MOA) by which rexlemestrocel-L reverses inflammation-related endothelial dysfunction and reduces adverse clinical outcomes across the spectrum of HFrEF patients.

• Mesoblast now intends to meet with FDA under its existing regenerative medicine advanced therapy (RMAT) designation to discuss data and the evidence of a common mechanism of action (MOA) across the broader HFrEF spectrum, including LVAD patients.

Other
Salary payments to full-time Executive Directors were US$329,579 and fees to Non-Executive Directors were US$199,442, detailed in Item 6 of the Appendix 4C cash flow report for the quarter.5

A copy of the Appendix 4C – Quarterly Cash Flow Report for the first quarter FY2023 is available on the investor page of the company’s website www.mesoblast.com.

About Mesoblast
Mesoblast is a world leader in developing allogeneic (off-the-shelf) cellular medicines for the treatment of severe and life-threatening inflammatory conditions. The Company has leveraged its proprietary mesenchymal lineage cell therapy technology platform to establish a broad portfolio of late-stage product candidates which respond to severe inflammation by releasing anti-inflammatory factors that counter and modulate multiple effector arms of the immune system, resulting in significant reduction of the damaging inflammatory process.

Mesoblast has a strong and extensive global intellectual property portfolio with protection extending through to at least 2041 in all major markets. The Company’s proprietary manufacturing processes yield industrial-scale, cryopreserved, off-the-shelf, cellular medicines. These cell therapies, with defined pharmaceutical release criteria, are planned to be readily available to patients worldwide.

Mesoblast is developing product candidates for distinct indications based on its remestemcel-L and rexlemestrocel-L allogeneic stromal cell technology platforms. Remestemcel-L is being developed for inflammatory diseases in children and adults including steroid refractory acute graft versus host disease, biologic-resistant inflammatory bowel disease, and acute respiratory distress syndrome. Rexlemestrocel-L is in development for advanced chronic heart failure and chronic low back pain. Two products have been commercialized in Japan and Europe by Mesoblast’s licensees, and the Company has established commercial partnerships in Europe and China for certain Phase 3 assets.

Mesoblast has locations in Australia, the United States and Singapore and is listed on the Australian Securities Exchange (MSB) and on the Nasdaq (MESO). For more information, please see www.mesoblast.com, LinkedIn: Mesoblast Limited and Twitter: @Mesoblast

References / Footnotes

1. The Appendix 4C for the quarter ended September 30, 2021 reported net cash usage for operating activities of US$19.6m which was subsequently revised to US$18.2 million due to a change in accounting policy adopted at December 31, 2021.
2. Berger M, Pessolano R, Carraro F, Saglio F, Vassallo E, Fagioli F. Steroid-refractory acute graft-versus-host disease graded III-IV in pediatric patients. A mono-institutional experience with a long-term follow-up. Pediatric Transplantation. 2020; 24(7):e13806
3. Rashidi A, DeFor T, Holtan S, Blazar B, Weisdorf D, MacMillan M. Outcomes and Predictors of Response in Steroid-Refractory Acute Graft-versus-Host Disease. Biol Blood Marrow Transplant. 25 (2019) 2297-2302
4. Biavasco F, Ihorst G, Wasch R, Wehr C, Bertz H, Finke J, Zeiser R. Therapy response of glucocorticoid-refractory acute GVHD of the lower intestinal tract. Bone Marrow Transplantation. 2022
5. As required by ASX listing rule 4.7 and reported in Item 6 of the Appendix 4C, reported are the aggregated total payments to related parties being Executive Directors and Non-Executive Directors
   

Forward-Looking Statements
This press release includes forward-looking statements that relate to future events or our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ materially from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. We make such forward-looking statements pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. Forward-looking statements should not be read as a guarantee of future performance or results, and actual results may differ from the results anticipated in these forward-looking statements, and the differences may be material and adverse. Forward-looking statements include, but are not limited to, statements about: the initiation, timing, progress and results of Mesoblast’s preclinical and clinical studies, and Mesoblast’s research and development programs; Mesoblast’s ability to advance product candidates into, enroll and successfully complete, clinical studies, including multi-national clinical trials; Mesoblast’s ability to advance its manufacturing capabilities; the timing or likelihood of regulatory filings and approvals (including BLA resubmission), manufacturing activities and product marketing activities, if any; the commercialization of Mesoblast’s product candidates, if approved; regulatory or public perceptions and market acceptance surrounding the use of stem-cell based therapies; the potential for Mesoblast’s product candidates, if any are approved, to be withdrawn from the market due to patient adverse events or deaths; the potential benefits of strategic collaboration agreements and Mesoblast’s ability to enter into and maintain established strategic collaborations; Mesoblast’s ability to establish and maintain intellectual property on its product candidates and Mesoblast’s ability to successfully defend these in cases of alleged infringement; the scope of protection Mesoblast is able to establish and maintain for intellectual property rights covering its product candidates and technology; estimates of Mesoblast’s expenses, future revenues, capital requirements and its needs for additional financing; Mesoblast’s financial performance; developments relating to Mesoblast’s competitors and industry; and the pricing and reimbursement of Mesoblast’s product candidates, if approved. You should read this press release together with our risk factors, in our most recently filed reports with the SEC or on our website. Uncertainties and risks that may cause Mesoblast’s actual results, performance or achievements to be materially different from those which may be expressed or implied by such statements, and accordingly, you should not place undue reliance on these forward-looking statements. We do not undertake any obligations to publicly update or revise any forward-looking statements, whether as a result of new information, future developments or otherwise.

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