Mesoblast Reports Financial Results and Operational Highlights for the Period Ended March 31, 2019
Mesoblast Chief Executive Dr
Recent Corporate Highlights
The United States Food and Drug Administration( FDA) has agreed to a rolling Biologics License Application (BLA) review of remestemcel-L for the treatment of steroid-refractory acute Graft Versus Host Disease (aGVHD) in children.
- Mesoblast has initiated the rolling submission of the BLA to the
FDA, with filing of the first module. The rolling process will provide opportunity for ongoing communication, and during this process the Company expects it will be able to adequately address any substantial matters raised by the FDA.
- Mesoblast and the
International Center for Health Outcomes and Innovation Researchat the Icahn School of Medicineat Mount Sinaientered into a Memorandum of Understanding to conduct a confirmatory clinical trial using Revascor for reduction of gastrointestinal (GI) bleeding in end-stage heart failure patients implanted with a left ventricular assist device (LVAD).
- Mesoblast’s Phase 3 trial in advanced heart failure has completed patient enrollment, with 566 patients randomized to receive Revascor or placebo. The study, conducted across 55 centers in
North America, will complete when sufficient primary endpoint events have accrued.
- Mesoblast’s Phase 3 trial in chronic low back pain has completed enrollment with 404 patients randomized to receive MPC-06-ID or placebo. All assessable patients have now completed at least 12 months of safety and efficacy follow-up.
- Mesoblast extended its license with
JCR Pharmaceuticals Co., Ltd.(JCR) in Japanfor use of TEMCELL®1 HS Inj. in patients with Epidermolysis Bullosa. JCR has now filed to extend marketing approval for this indication.
- The Board appointed Joseph R. Swedish as Chairman in
April 2019. Mr Swedish brings deep healthcare expertise and a track record in healthcare resource allocation and reimbursement metrics, as the Company enters commercial stage.
Key Financial Highlights for the Nine Months of FY2019:
- Cash reserves of
US$70.4 millionat March 31, 2019. Additional non-dilutive capital of US$35.0 millionmay be available under existing arrangements with Hercules Capital, Inc.(Hercules) and NovaQuest Capital Management, L.L.C.(NovaQuest), subject to certain milestones.
- 28% increase in royalty income on sales of TEMCELL for aGVHD in
- Stable revenue of
US$14.7 million, compared with US$15.6 millionin the nine months of FY2018.
- Increased investment in commercial manufacturing of
US$9.5 millionto support potential launch for aGVHD product.
- 29% reduction in net operating cash outflows in the nine months of FY2019 to
Key milestones anticipated for CY2019 include:
- Completion of BLA filing for remestemcel-L in the treatment of steroid refractory aGVHD in children.
- Phase 3 trial in advanced heart failure continues accrual of primary endpoints through to completion.
- Meet with
FDAto discuss pathway for approval of Revascor for the reduction of GI bleeding in end-stage heart failure patients implanted with a LVAD.
- Mesoblast’s partner Tasly plans to meet with the
National Medical Products Administration of Chinato discuss the regulatory approval pathway for Revascor in China.
- Patient follow up continues through 24-month assessment of safety and efficacy in the Company’s Phase 3 trial of MPC-06-ID for chronic lower back pain.
Detailed Financial Results for the Nine Months Ended
- Revenues were
US$14.7 millionfor the nine months of FY2019, compared with US$15.6 millionfor the nine months of FY2018. Revenues comprised:
US$10.0 millionmilestone revenue recognized in the nine months of FY2019 in relation to establishing a partnership with Tasly in China, compared with US$11.8 millionmilestone revenue recognized in the nine months of FY2018 in relation to the patent license agreement with Takeda Pharmaceutical Company Limited.
° US$4.3 million royalties and milestones revenue recognized in the nine months of FY2019 from sales of TEMCELL by our licensee in
Japan, JCR, compared with US$3.6 millionin the nine months of FY2018, an increase of US$0.7 million. Royalty income from TEMCELL increased by 28% for the nine months of FY2019.
- Research and Development expenses were
US$48.4 millionfor the nine months of FY2019, stable when compared to the nine months of FY2018. For the third quarter, Research and Development expenses decreased by US$2.4mversus the comparative quarter in FY2018.
- Manufacturing expenses were
US$12.9 millionfor the nine months of FY2019, compared with US$3.4 millionfor the nine months of FY2018. This reflects commercial manufacturing investment to support potential launch for aGVHD product.
- Management and Administration expenses were
US$16.0 millionfor the nine months of FY2019, a decrease of US$0.7 millionon the comparative period of FY2018.
- Finance Costs were
US$7.9 millionfor the nine months of FY2019, compared with US$0.4 millionfor the nine months of FY2018, primarily due to expenses in relation to loan and security agreements entered into with Hercules in March 2018and NovaQuest in June 2018.
Additional components of loss after income tax also include movements in other items which did not impact current cash reserves, such as income tax benefits, fair value remeasurement of contingent consideration, remeasurement of borrowing arrangements and foreign exchange movements within other operating income and expenses.
In the nine months of FY2019, the net loss attributable to ordinary shareholders was
1TEMCELL® HS Inj. is a registered trademark of
Conference Call Details
There will be a webcast today on the financial results beginning at
The live webcast can be accessed via
To access the call only, dial 1 855 881 1339 (U.S.), 1 800 558 698 (toll-free
The archived webcast will be available on the Investor page of the Company’s website: www.mesoblast.com
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
For further information, please contact:
|Julie Meldrum||Schond Greenway|
|Corporate Communications||Investor Relations|
|T: +61 3 9639 6036||T: +1 212 880 2060|
|E: [email protected]||E: [email protected]|
Consolidated Income Statement
|Three Months Ended
|Nine Months Ended
|(in U.S. dollars, in thousands, except per share amount)||2019||2018||2019||2018|
|Research & development||(14,407||)||(16,798||)||(48,380||)||(48,388||)|
|Management and administration||(5,256||)||(6,033||)||(15,998||)||(16,688||)|
|Fair value remeasurement of contingent consideration||(2,718||)||(822||)||(3,352||)||7,880|
|Other operating income and expenses||(82||)||152||(1,060||)||1,243|
|Loss before income tax||(27,175||)||(24,563||)||(74,851||)||(44,122||)|
|Income tax benefit||2,205||3,426||5,778||29,666|
|Loss attributable to the owners of Mesoblast Limited||(24,970||)||(21,137||)||(69,073||)||(14,456||)|
|Losses per share from continuing operations attributable
to the ordinary equity holders of the Group:
|Basic - losses per share||(5.00||)||(4.47||)||(14.02||)||(3.12||)|
|Diluted - losses per share||(5.00||)||(4.47||)||(14.02||)||(3.12||)|
Consolidated Statement of Comprehensive Income
|Three Months Ended
|Nine Months Ended
|(in U.S. dollars, in thousands)||2019||2018||2019||2018|
|Loss for the period||(24,970||)||(21,137||)||(69,073||)||(14,456||)|
|Other comprehensive (loss)/income|
|Items that may be reclassified to profit and loss|
|Changes in the fair value of financial assets||85||74||280||141|
|Exchange differences on translation of foreign operations||79||(69||)||(104||)||(569||)|
|Other comprehensive (loss)/income for the period,
net of tax
|Total comprehensive losses attributable to the
owners of Mesoblast Limited
Consolidated Statement of Balance Sheet
|(in U.S. dollars, in thousands)||As of
|Cash & cash equivalents||70,385||37,763|
|Trade & other receivables||3,508||50,366|
|Total Current Assets||85,527||101,071|
|Property, plant and equipment||825||1,084|
|Financial assets at fair value through other comprehensive income||2,601||2,321|
|Other non-current assets||3,331||3,361|
|Total Non-Current Assets||590,178||591,372|
|Trade and other payables||18,551||18,921|
|Total Current Liabilities||44,502||24,003|
|Deferred tax liability||14,301||20,079|
|Total Non-Current Liabilities||130,261||122,432|
|(Accumulated losses)/retained earnings||(449,265||)||(380,192||)|
Consolidated Statement of Cash Flows
|Nine months ended
|(in U.S. dollars, in thousands)||2019||2018|
|Cash flows from operating activities|
|Commercialization revenue received||3,321||2,529|
|Milestone payment received||26,409||6,125|
|Research and development tax incentive received||1,654||—|
|Payments to suppliers and employees (inclusive of goods and
|Income taxes (paid)||(3||)||(25||)|
|Net cash (outflows) in operating activities||(38,704||)||(54,824||)|
|Cash flows from investing activities|
|Investment in fixed assets||(202||)||(174||)|
|Payments for contingent consideration||—||(543||)|
|Net cash (outflows) in investing activities||(202||)||(717||)|
|Cash flows from financing activities|
|Proceeds from borrowings||43,572||31,704|
|Payments of transaction costs from borrowings||(1,582||)||(40||)|
|Proceeds from issue of shares||30,258||40,566|
|Payments for share issue costs||(607||)||(2,604||)|
|Net cash inflows by financing activities||71,641||69,626|
|Net increase in cash and cash equivalents||32,735||14,085|
|Cash and cash equivalents at beginning of period||37,763||45,761|
|FX (losses) on the translation of foreign bank accounts||(113||)||(307||)|
|Cash and cash equivalents at end of period||70,385||59,539|
Source: Mesoblast Limited