Mesoblast Ltd. Q4 FY2025 earnings call

• Company profile: Mesoblast has an FDA-approved product Ryoncil, over 1,100 patents/patent applications, 2 assets in Phase III trials, FDA commercial scale manufacturing, and a built U.S. commercial organization.
• Platform technology: Mesenchymal lineage stromal cells respond to inflammatory cytokines, orchestrating an anti-inflammatory cascade.
• Product portfolio: Ryoncil (remestemcel-L platform) for pediatric and potential adult acute GvHD, rexlemestrocel-L (second-gen) in Phase III for inflammatory chronic heart failure and chronic low back pain due to disc inflammation.
• Addressable market: Ryoncil has ~$1B market for pediatric acute GvHD, >$5B for biologic refractory IBD, >$10B for heart failure and chronic low back pain with rexlemestrocel-L.
• Ryoncil launch: Launched in past quarter, onboarded 32 transplant centers, Medicaid coverage mandated July 1, 250M+ U.S. lives insured.
• Label extension plans: Ryoncil for adult acute GvHD (pivotal trial with BMT-CTN), and IBD (pivotal study for inflammatory colitis).
• Rexlemestrocel-L progress: Chronic low back pain trial enrolling, heart failure trial results show reduced mortality and MACE events, FDA alignment for accelerated approval filing.

Cell therapy products generated revenue of $17.2 million for the period ended June 30, 2025, which was a 191% increase from the prior year. Cost of revenues related to product sales was $1.2 million, accounting for 10% of net product sales and resulting in a 90% gross margin. Additionally, there were non-cash expenses like amortization of intangible assets and revaluation losses. The revenue contribution from Ryoncil, the lead product, was significant, with $13.2 million in gross sales and $11.3 million in net sales after a 14.6% gross to net adjustment.

• Commence a registration trial for label expansion in adults with GvHD.
• Initiate a study for inflammatory colitis.
• Prepare for an accelerated approval filing for Revascor (rexlemestrocel-L for chronic heart failure).
• Confirmatory Phase III trial for rexlemestrocel-L in chronic low back pain actively enrolling, with primary endpoint of pain at 12 months after last patient enrolled.

Q: Ted Tenthoff asks about the timeline for the Phase III trial in adults with GvHD.

A: Silviu Itescu states they will commence an adult acute GvHD trial this quarter with the NIH-funded Bone Marrow Transplant Clinical Trials Network (BMT-CTN), contributing to funding and aiming to extend the label from children to adults.

Q: Olivia Brayer inquires about treatment kits administered, inventory dynamics, and gross to net evolution.

A: Silviu explains inventory is replenished based on weight bands of children, with kits replenished as each infusion is given; gross to net is expected to be stagnant; he also discusses how to calculate kits sold using gross to net adjustments.

Q: Elyse Brayer asks about adult GvHD trial design and IBD trial timelines.

A: Silviu mentions the adult trial will be on top of approved second-line therapy like ruxolitinib, and IBD trial design is being worked on by a KOL group with plans to initiate a pivotal study.

Q: Michael Okunewitch asks about sales distribution and revenue trajectory.

A: Silviu states it's early to project, but expects continued growth in sales as the commercial team strengthens sales.

Q: John Hester asks about market access.

A: Marcelo Santoro notes Ryoncil is covered by over 250M lives in U.S. payers, Medicaid is in place everywhere, commercial payers support it, and a J-Code for Ryoncil goes into effect October 1 for efficient billing.