Full Press Release Details
OPERATIONAL HIGHLIGHTS AND FINANCIAL RESULTS FOR THE PERIOD ENDED MARCH 31, 2021
Melbourne, Australia; June 3 and New York, USA; June 2, 2021: Mesoblast Limited (ASX:MSB; Nasdaq:MESO), global leader in allogeneic cellular medicines for inflammatory diseases, today reported operational highlights and financial results for the period ended March 31, 2021.
"We are pleased with the recent clinical outcomes regarding our lead product candidate remestemcel-L and continue to progress our regulatory discussions with the aim of achieving approval. Our focus and top priority remains on successfully bringing remestemcel-L to children with the devastating complication of steroid-refractory acute graft versus host disease and adults fighting COVID-19 acute respiratory distress syndrome," said Silviu Itescu, Chief Executive of Mesoblast.
Operational Highlights
Remestemcel-L in the treatment of steroid-refractory acute graft versus host disease (SR-aGVHD) in children:
Remestemcel-L in the treatment of COVID-19 ARDS in adults:
Rexlemestrocel-L in the treatment of chronic low back pain:
Financial Highlights
Key initiatives and Upcoming Milestones for the Next Two Quarters
Steroid-Refractory Acute Graft Versus Host Disease
Mesoblast continues to be in discussion with the United States Food & Drug Administration (FDA) through a well-established regulatory process that may include a resubmission with a six month review with the aim of achieving approval of remestemcel-L in the treatment of steroid-refractory acute graft versus host disease (SR-aGVHD) in children.
As part of this process, Mesoblast recently met with the FDA's Center for Biologics Evaluation and Research (CBER). Following CBER's recommendation after this meeting, Mesoblast as a next step will discuss with CBER's review team at the Office of Tissue and Advanced Therapies (OTAT) our approach to address certain outstanding chemistry, manufacturing and controls (CMC) items, including potency assay validation.
Acute Respiratory Distress Syndrome due to COVID-19
Mesoblast recently announced top-line 60-day outcomes from the randomized, placebo-controlled trial of remestemcel-L in 222 ventilator-dependent COVID-19 patients with moderate/severe ARDS which had been halted after the third interim analysis since the 30-day primary endpoint would not be
attained. Remestemcel-L reduced mortality through day 60 by 46% in the pre-specified group below age 65, but not in patients 65 or older. Remestemcel-L reduced mortality by 75% and increased days alive off mechanical ventilation in patients under age 65 when combined with dexamethasone, in comparison with controls on dexamethasone.
Reduction in mortality in mechanically ventilated patients under 65 years old remains a critical unmet need since as many as 72% of currently hospitalized patients across the US with COVID-19 are in this age category.2 This is similar to other causes of viral ARDS such as influenza where 70-80% of patients in intensive care units are under 65.3,4 The trial enrolled 222 mechanically ventilated COVID-19 patients with moderate/severe ARDS across the US, of whom 217 were randomized 1:1 and received either standard of care alone or standard of care plus 2 intravenous infusions of remestemcel-L at a dose of 2 million cells/kg 3-5 days apart. This was the same remestemcel-L dosing regimen used in the earlier compassionate use program where 11 of the 12 patients were younger than 65 and 75% successfully came off ventilatory support.
Key findings in the trial were:
Inflammatory Bowel Disease - Crohn's Disease and Ulcerative Colitis
A randomized, controlled study of remestemcel-L delivered by an endoscope directly to the areas of inflammation and tissue injury in up to 48 patients with medically refractory Crohn's disease and ulcerative colitis commenced at Cleveland Clinic in October 2020. The investigator-initiated study is the first in humans using local cell delivery in the gut and will enable Mesoblast to compare clinical outcomes using this delivery method with results from an ongoing randomized, placebo-controlled trial in patients with biologic-refractory Crohn's disease where remestemcel-L was administered intravenously.
Revascor for Chronic Heart Failure
The results from the landmark DREAM-HF randomized controlled trial in 537 treated patients with chronic heart failure with reduced left ventricular ejection fraction (HFrEF) who received rexlemestrocel-L (REVASCOR ) or control sham, demonstrated that a single dose of rexlemestrocel-L resulted in substantial and durable reductions in heart attacks, strokes, and cardiac deaths. The trial's primary endpoint of reduction in volume overload related hospitalizations was not achieved. The results of this trial identify New York Heart Association (NYHA) class II HFrEF patients as the optimal
target population for greatest rexlemestrocel-L treatment effect, and therefore a focus for developing rexlemestrocel-L in the largest market in heart failure.
Based on the observed reduction in mortality and morbidity in this trial, Mesoblast intends to meet with the FDA to discuss potential next steps in the regulatory pathway.
MPC-06-ID for Chronic Low Back Pain due to Degenerative Disc Disease
The results from the randomized controlled trial of its allogeneic mesenchymal precursor cell (MPC) therapy rexlemestrocel-L in 404 enrolled patients with chronic low back pain (CLBP) due to degenerative disc disease (DDD) refractory to conventional treatments indicate that a single injection of rexlemestrocel-L + hyaluronic acid (HA) carrier may provide a safe, durable, and effective opioid-sparing therapy for patients with chronic inflammatory back pain due to degenerative disc disease, and that greatest benefits are seen when administered earlier in the disease process before irreversible fibrosis of the intervertebral disc has occurred.
There is a significant need for a safe, efficacious, and durable opioid-sparing treatment in patients with chronic low back pain due to severely inflamed degenerative disc disease. Mesoblast intends to meet with FDA to discuss a potential pathway for approval of rexlemestrocel-L in patients with chronic discogenic lower back pain based on the observed durable reduction in pain and opioid sparing activity in the CLBP trial.
Financial Results for the Three Months Ended March 31, 2021 (third quarter FY2021)
As a result of the above and other remeasurements on revaluation of assets and liabilities, the loss after tax for the third quarter FY2021 was US$26.5 million compared to US$15.3 million for third quarter FY2020. The net loss attributable to ordinary shareholders was 4.39 US cents per share for third quarter FY2021, compared with 2.84 US cents per share for third quarter FY2020.
There will be a webcast today, beginning at 8.30am AEST (Thursday, June 3); 6.30pm EDT (Wednesday, June 2, 2021). It can be accessed via:
The archived webcast will be available on the Investor page of the Company's website: www.mesoblast.com
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 2040 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 has completed Phase 3 trials of rexlemestrocel-L for advanced chronic heart failure and chronic low back pain. Remestemcel-L is being developed for inflammatory diseases in children and adults including steroid refractory acute graft versus host disease and moderate to severe acute respiratory distress syndrome. 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
Forward-Looking Statements
This announcement 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, 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.
Release authorized by the Chief Executive.
For more information, please contact:
| Corporate Communications / Investors | Media |
| Paul Hughes | Kristen Bothwell |
| T: +61 3 9639 6036 | T: +1 917 613 5434 |
| E: investors@mesoblast.com | E: kbothwell@rubenstein.com |
Consolidated Income Statement
| Three Months Ended March 31, | Nine Months Ended March 31, | |||||||||||||||
| (in U.S. dollars, in thousands, except per share amount) | 2021 | 2020 | 2021 | 2020 | ||||||||||||
| Revenue | 1,915 | 12,201 | 5,461 | 31,455 | ||||||||||||
| Research & development | (12,441 | ) | (14,379 | ) | (45,957 | ) | (40,922 | ) | ||||||||
| Manufacturing commercialization | (7,332 | ) | (7,612 | ) | (25,706 | ) | (15,456 | ) | ||||||||
| Management and administration | (8,087 | ) | (5,730 | ) | (23,633 | ) | (17,960 | ) | ||||||||
| Fair value remeasurement of contingent consideration | 1,534 | 2,158 | 18,103 | 1,276 | ||||||||||||
| Other operating income and expenses | 1,025 | (442 | ) | 1,420 | (67 | ) | ||||||||||
| Finance costs | (3,227 | ) | (3,414 | ) | (7,193 | ) | (9,814 | ) | ||||||||
| Loss before income tax | (26,613 | ) | (17,218 | ) | (77,505 | ) | (51,488 | ) | ||||||||
| Income tax (expense)/benefit | 98 | 1,955 | 754 | 6,158 | ||||||||||||
| Loss attributable to the owners of Mesoblast Limited | (26,515 | ) | (15,263 | ) | (76,751 | ) | (45,330 | ) | ||||||||
| Losses per share from continuing operations attributable to the ordinary equity holders of the Group: | Cents | Cents | Cents | Cents | ||||||||||||
| Basic - losses per share | (4.39 | ) | (2.84 | ) | (12.99 | ) | (8.66 | ) | ||||||||
| Diluted - losses per share | (4.39 | ) | (2.84 | ) | (12.99 | ) | (8.66 | ) |
Consolidated Statement of Comprehensive Income
| Three Months Ended March 31, | Nine Months Ended March 31, | |||||||||||||||
| (in U.S. dollars, in thousands) | 2021 | 2020 | 2021 | 2020 | ||||||||||||
| Loss for the period | (26,515 | ) | (15,263 | ) | (76,751 | ) | (45,330 | ) | ||||||||
| Other comprehensive (loss)/income | ||||||||||||||||
| Items that may be reclassified to profit and loss | ||||||||||||||||
| Financial assets at fair value through other comprehensive income | 81 | 94 | 109 | (551 | ) | |||||||||||
| Exchange differences on translation of foreign operations | (2,712 | ) | (361 | ) | (1,400 | ) | (405 | ) | ||||||||
| Other comprehensive (loss) for the period, net of tax | (2,631 | ) | (267 | ) | (1,291 | ) | (956 | ) | ||||||||
| Total comprehensive losses attributable to the owners of Mesoblast Limited | (29,146 | ) | (15,530 | ) | (78,042 | ) | (46,286 | ) |
Consolidated Balance Sheet
| As of March 31, | As of June 30, | |||||||
| (in U.S. dollars, in thousands) | 2021 | 2020 | ||||||
| Assets | ||||||||
| Current Assets | ||||||||
| Cash & cash equivalents | 158,263 | 129,328 | ||||||
| Trade & other receivables | 2,947 | 1,574 | ||||||
| Prepayments | 8,556 | 5,646 | ||||||
| Total Current Assets | 169,766 | 136,548 | ||||||
| Non-Current Assets | ||||||||
| Property, plant and equipment | 2,989 | 2,293 | ||||||
| Right-of-use assets | 7,247 | 7,978 | ||||||
| Financial assets at fair value through other comprehensive income | 1,981 | 1,871 | ||||||
| Other non-current assets | 3,203 | 3,311 | ||||||
| Intangible assets | 580,939 | 581,601 | ||||||
| Total Non-Current Assets | 596,359 | 597,054 | ||||||
| Total Assets | 766,125 | 733,602 | ||||||
| Liabilities | ||||||||
| Current Liabilities | ||||||||
| Trade and other payables | 24,275 | 24,972 | ||||||
| Provisions | 18,757 | 29,197 | ||||||
| Borrowings | 52,673 | 32,455 | ||||||
| Lease liabilities | 2,841 | 3,519 | ||||||
| Total Current Liabilities | 98,546 | 90,143 | ||||||
| Non-Current Liabilities | ||||||||
| Deferred tax liability | - | 730 | ||||||
| Provisions | 17,823 | 27,563 | ||||||
| Borrowings | 39,847 | 57,023 | ||||||
| Lease liabilities | 6,479 | 6,317 | ||||||
| Deferred consideration | 2,500 | 2,500 | ||||||
| Total Non-Current Liabilities | 66,649 | 94,133 | ||||||
| Total Liabilities | 165,195 | 184,276 | ||||||
| Net Assets | 600,930 | 549,326 | ||||||
| Equity | ||||||||
| Issued Capital | 1,162,188 | 1,051,450 | ||||||
| Reserves | 64,251 | 46,634 | ||||||
| (Accumulated losses)/retained earnings | (625,509 | ) | (548,758 | ) | ||||
| Total Equity | 600,930 | 549,326 |
Consolidated Statement of Cash Flows
| Nine Months Ended March 31, | ||||||||
| (in U.S. dollars, in thousands) | 2021 | 2020 | ||||||
| Cash flows from operating activities | ||||||||
| Commercialization revenue received | 4,162 | 5,579 | ||||||
| Upfront and milestone payments received | - | 17,500 | ||||||
| Government grants and tax incentives received | 56 | 1,499 | ||||||
| Payments to suppliers and employees (inclusive of goods and services tax) | (86,029 | ) | (57,722 | ) | ||||
| Interest received | 17 | 533 | ||||||
| Interest and other costs of finance paid | (4,122 | ) | (4,165 | ) | ||||
| Income taxes paid | (35 | ) | (7 | ) | ||||
| Net cash (outflows) in operating activities | (85,951 | ) | (36,783 | ) | ||||
| Cash flows from investing activities | ||||||||
| Investment in fixed assets | (1,424 | ) | (1,305 | ) | ||||
| Payments for licenses | - | (100 | ) | |||||
| Net cash (outflows) in investing activities | (1,424 | ) | (1,405 | ) | ||||
| Cash flows from financing activities | ||||||||
| Payments of transaction costs from borrowings | (13 | ) | - | |||||
| Proceeds from issue of shares | 105,584 | 51,559 | ||||||
| Proceeds from issue of warrants | 12,969 | - | ||||||
| Payments for share issue costs | (1,547 | ) | (2,211 | ) | ||||
| Payments for lease liabilities | (2,100 | ) | (1,219 | ) | ||||
| Net cash inflows by financing activities | 114,893 | 48,129 | ||||||
| Net increase in cash and cash equivalents | 27,518 | 9,941 | ||||||
| Cash and cash equivalents at beginning of period | 129,328 | 50,426 | ||||||
| FX gain/(losses) on the translation of foreign bank accounts | 1,417 | (290 | ) | |||||
| Cash and cash equivalents at end of period | 158,263 | 60,077 |