Mesoblast Ltd. Q2 FY2025 earnings call

• RYONCIL is the first FDA-approved off-the-shelf therapy for children aged two months and older with steroid-refractory acute GVHD, launching in the US in March 2024. It has a wholesale acquisition cost of $194,000 per intravenous infusion and a patient services hub MyMesoblast established to assist with access. - Rexlemestrocel is in a confirmatory Phase III trial for chronic inflammatory low back pain, showing significant pain reduction vs placebo at 12 months, with 50% of patients achieving complete remission and 30% coming off opioids. In ischemic heart failure, rexlemestrocel showed significant reduction in cardiovascular death risk in Phase III trials. - Engaged with FDA to discuss accelerated approval pathways for rexlemestrocel in ischemic heart failure and regulatory approval for children with congenital heart disease.

Mesoblast's product segments include RYONCIL, the first FDA-approved mesenchymal stromal cell therapy, and rexlemestrocel in development. RYONCIL's FDA approval led to inventory adjustments, with a $23 million provision against prior inventory value reversed. Rexlemestrocel is in clinical development for inflammatory cardiovascular disease and inflammatory back pain. RYONCIL contributes through its approval and potential market entry, while rexlemestrocel is in the pipeline for future revenue.

• RYONCIL will be available in the US for pediatric GVHD in March 2024, with studies commencing for adult GVHD and pediatric/adult inflammatory bowel disease label extensions. - Rexlemestrocel's Phase III trial for chronic low back pain to accelerate enrollment across US sites. - Engage with FDA to clarify components for accelerated approval filing in ischemic heart failure and discuss regulatory approval for children with congenital heart disease.

• Regulatory approval uncertainty for ongoing trials and new indications. - Market acceptance risk for new products like rexlemestrocel and RYONCIL in specific patient populations. - Competition from other therapies in the pipeline for similar indications.

Q: Edward Tenthoff asked about the size of the sales force for RYONCIL and enrollment in the rexlemestrocel chronic lower back pain trial.

A: Silviu said RYONCIL is already known by physicians and transplant centers, and Marcelo mentioned a sales force of 9 key account managers focusing on 45 key transplant centers. For rexlemestrocel, enrollment is increasing with 15 sites onboard and aiming for 40 sites, with numbers rapidly growing.

Q: Michael Okunewitch inquired about RYONCIL's pricing of $194,000 per infusion and payer feedback.

A: Silviu stated the price is based on health economic models showing benefits between $3.2M to $4.1M, and Marcelo mentioned positive feedback from payers recognizing the product's value.

Q: Michael Okunewitch asked about FDA draft guidance on accelerated approvals and its impact on the ischemic heart failure program.

A: Silviu said they will meet with FDA to clarify confirmatory study design for accelerated approval and discuss next steps regarding timing and trial design.