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Financial risk management - Schedule of Maturity Profile of Anticipated Future Contractual Cash Flows Carrying Value (Details) $ in Thousands	Dec. 31, 2023 USD ($)
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	$ (195,085)
Carrying amount	(133,372)
Within 1 year
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	(28,630)
Between 1-2 years
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	(22,000)
Between 2-5 years
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	(144,455)
Over 5 years
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	0
Borrowings
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	(171,682)
Carrying amount	(115,763)
Borrowings \| Within 1 year
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	(9,739)
Borrowings \| Between 1-2 years
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	(18,242)
Borrowings \| Between 2-5 years
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	(143,701)
Borrowings \| Over 5 years
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	0
Trade payables
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	(10,760)
Carrying amount	(10,760)
Trade payables \| Within 1 year
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	(10,760)
Trade payables \| Between 1-2 years
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	0
Trade payables \| Between 2-5 years
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	0
Trade payables \| Over 5 years
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	0
Lease liabilities
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	(6,621)
Carrying amount	(6,237)
Lease liabilities \| Within 1 year
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	(3,131)
Lease liabilities \| Between 1-2 years
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	(2,877)
Lease liabilities \| Between 2-5 years
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	(613)
Lease liabilities \| Over 5 years
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	0
Contingent consideration
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	(6,022)
Carrying amount	(612)
Contingent consideration \| Within 1 year
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	(5,000)
Contingent consideration \| Between 1-2 years
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	(881)
Contingent consideration \| Between 2-5 years
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	(141)
Contingent consideration \| Over 5 years
Disclosure Of Maturity Analysis For Derivative Financial Liabilities [Line Items]
Total contractual cash flows	$ 0

Financial assets and liabilities - Summary of Fair Value of Warrants (Details) - Warrants	6 Months Ended	12 Months Ended
	Dec. 31, 2023 USD ($) Year $ / shares	Jun. 30, 2023 USD ($) Year $ / shares
Disclosure Of Financial Instruments [Line Items]
Share price (in dollars per share)	$ 1.10	$ 3.91
Dividend Yield	0.00%	0.00%
Expected Volatility	86.71%	81.26%
Risk Free Interest Rate	3.88%	4.01%
Fair value \| $	$ 992,233	$ 5,426,212
Minimum
Disclosure Of Financial Instruments [Line Items]
Exercise price (in dollars per share)	$ 3.70
Expected Term \| Year	5	6
Fair value per warrant (in dollars per share)	$ 0.4000	$ 2.3103
Maximum
Disclosure Of Financial Instruments [Line Items]
Exercise price (in dollars per share)	$ 7.26	$ 7.26
Expected Term \| Year	7	7
Fair value per warrant (in dollars per share)	$ 0.6248	$ 2.9401

Financial assets and liabilities

6 Months Ended

Dec. 31, 2023

Disclosure Of Financial Assets And Liabilities [Abstract]

Financial assets and liabilities

This note provides information about the Group's financial instruments, including:

•an overview of all financial instruments held by the Group;

•specific information about each type of financial instrument;

•accounting policies; and

•information used to determine the fair value of the instruments, including judgments and estimation uncertainty involved.

The Group holds the following financial instruments:


Financial assets (in U.S. dollars, in thousands)	Notes	Assets at FVOCI(1)	Assets at FVTPL(2)	Assets at amortized cost	Total
As of December 31, 2023
Cash & cash equivalents	5(a)	—	—	77,554	77,554
Trade & other receivables	5(b)	—	—	3,998	3,998
Financial assets at fair value through other comprehensive income		826	—	—	826
Other non-current assets		—	—	2,241	2,241
		826	—	83,793	84,619
As of June 30, 2023
Cash & cash equivalents	5(a)	—	—	71,318	71,318
Trade & other receivables	5(b)	—	—	6,998	6,998
Financial assets at fair value through other comprehensive income		1,757	—	—	1,757
Other non-current assets		—	—	2,326	2,326
		1,757	—	80,642	82,399

(1)Fair value through other comprehensive income

(2)Fair value through profit or loss


Financial liabilities (in U.S. dollars, in thousands)	Notes	Liabilities at FVOCI(1)	Liabilities at FVTPL(2)	Liabilities at amortized cost	Total
As of December 31, 2023
Trade and other payables	5(c)	—	—	10,760	10,760
Borrowings	5(d)	—	—	115,762	115,762
Contingent consideration	5(e)(iii)	—	17,536	—	17,536
Warrant liability	5(e)(vi)	—	992	—	992
		—	18,528	126,522	145,050
As of June 30, 2023
Trade and other payables	5(c)	—	—	20,145	20,145
Borrowings	5(d)	—	—	108,763	108,763
Contingent consideration	5(e)(iii)	—	17,199	—	17,199
Warrant liability	5(e)(vi)	—	5,426	—	5,426
		—	22,625	128,908	151,533

(1)Fair value through other comprehensive income

(2)Fair value through profit or loss

The Group’s exposure to various risks associated with the financial instruments is discussed in Note 9. The maximum exposure to credit risk at the end of the reporting period is the carrying amount of each class of financial assets mentioned above.

a. Cash and cash equivalents


(in U.S. dollars, in thousands)	As of December 31, 2023	As of June 30, 2023
Cash at bank	77,144	70,920
Deposits at call(1)	410	398
	77,554	71,318


(1)As of December 31, 2023 and June 30, 2023, interest-bearing deposits at call include amounts of $0.4 million and $0.4 million, respectively, held as security and restricted for use.

(i) Classification as cash equivalents

Term deposits are presented as cash equivalents if they have a maturity of three months or less from the date of acquisition.

b. Trade and other receivables and prepayments

(i) Trade and other receivables


(in U.S. dollars, in thousands)	As of December 31, 2023	As of June 30, 2023
Trade debtors	1,804	2,276
Tax incentives recoverable (1)	1,271	2,363
Foreign withholding tax recoverable	471	471
U.S. Tax credits	—	1,473
Net investment in sublease	216	195
Interest receivables	11	18
Other recoverable taxes (Goods and services tax and value-added tax)	225	202
Trade and other receivables	3,998	6,998

(1) Research and development tax incentive

The Group's research and development activities are eligible under the Australian government's Innovation

Australia Research and Development Tax Incentive program for research and development activities conducted in relation

to qualifying research that meets the regulatory criteria. Management has assessed these activities and expenditures to

determine which costs are likely to be eligible under the incentive scheme. The Group assesses, on an annual basis, the

quantum of previous research and development tax claims and on-going eligibility to claim this tax incentive in Australia. The tax incentives recoverable as of December 31, 2023 pertains to an estimate for the year ended June 30, 2023.

(ii) Prepayments


(in U.S. dollars, in thousands)	As of December 31, 2023	As of June 30, 2023
Clinical trial research and development expenditure	23	950
Prepaid insurance and subscriptions	3,219	2,025
Other	360	367
Prepayments	3,602	3,342

(iii) Classification as trade and other receivables

Trade receivables and other receivables represent the principal amounts due at balance date less, where applicable, any provision for expected credit losses. The Group uses the simplified approach to measuring expected credit losses, which uses a lifetime expected credit loss allowance. Debts which are known to be uncollectible are written off in the consolidated income statement. All trade receivables and other receivables are recognized at the value of the amounts receivable, as they are due for settlement within 60 days and therefore do not require remeasurement.

(iv) Fair values of trade and other receivables

Due to the short-term nature of the current receivables, their carrying amount is assumed to be the same as their fair value.

(v) Impairment and risk exposure

Information about the impairment of trade and other receivables, their credit quality and the Group’s exposure to credit risk, foreign currency risk and interest rate risk can be found in Note 9.

c. Trade and other payables


(in U.S. dollars, in thousands)	As of December 31, 2023	As of June 30, 2023
Trade payables and other payables	10,760	20,145
Trade and other payables	10,760	20,145

The carrying amounts of trade and other payables are assumed to be the same as their fair values, due to their short-term nature.

d. Borrowings


(in U.S. dollars, in thousands)	As of December 31, 2023	As of June 30, 2023
Borrowings
Secured liabilities:
Borrowing arrangements	81,919	81,919
Less: transaction costs	(9,215)	(8,740)
Amortization of carrying amount, net of payments made	43,058	35,584
	115,762	108,763

(in U.S. dollars, in thousands)	As of December 31, 2023	As of June 30, 2023
Borrowings
Current
Borrowings - NovaQuest	367	336
Borrowings - Oaktree	8,167	5,616
	8,534	5,952
Non-current
Borrowings - NovaQuest	60,878	55,739
Borrowings - Oaktree	46,350	47,072
	107,228	102,811
	115,762	108,763

(i) Borrowing arrangements

Funds associated with Oaktree Capital Management, L.P. (“Oaktree”)

In November 2021, the Group entered into a $90.0 million five-year senior debt facility provided by funds associated with Oaktree. The Group drew the first tranche of $60.0 million on closing. The conditions required to draw down the additional $30.0 million tranche have not been met. The facility has a three-year interest only period, at a fixed rate of 9.75% per annum, after which time 40% of the principal amortizes over two years and a final payment is due no later than November 2026. The facility also allowed the Group to make quarterly payments of interest at a rate of 8.0% per annum for the first two years, and the unpaid interest portion (1.75% per annum) has been added to the outstanding loan balance and currently accrues further interest at a fixed rate of 9.75% per annum.

On November 19, 2021, Oaktree were also granted warrants to purchase 1,769,669 American Depositary Shares (“ADSs”) at US$7.26 per ADS, a 15% premium to the 30-day VWAP. The Group determined that an obligation to issue the warrants arose from the time the debt facility was signed; consequently, a liability for the warrants was recognized in November 2021. The warrants were legally issued on January 11, 2022 and may be exercised within 7 years of issuance. On the issuance date of the Oaktree facility and the warrants, the warrants were initially measured at fair value and the

Oaktree borrowing liability measured as the difference between the $60.0 million received from the Oaktree facility and the fair value of the warrants. In December 2022, the Group amended the terms of the loan agreement with Oaktree and in connection with the loan amendment, Oaktree was granted warrants to purchase 455,000 ADSs at $3.70 per ADS, a 15% premium to the 30-day VWAP. The Group determined that an obligation to issue the warrants arose from the time the first amendment to the loan agreement was signed; consequently, a liability for the warrants was recognized in December 2022. The warrants were legally issued on March 8, 2023 and may be exercised within 7 years of issuance. Refer to Note 5(e)(vi) for more details on warrants issued.

On January 5, 2024, the ratio under Mesoblast's American Depository Receipt ("ADR") program was changed from 5 ordinary shares representing 1 ADS (5:1 ratio) to a new ratio of 10 ordinary shares representing 1 ADS (10:1 ratio). As a result of this ratio change and as a result of completing the pro-rata accelerated non-renounceable rights issue in December 2023, the number and exercise price for the warrants was adjusted in accordance with the terms of these warrants. The warrants issued in November 2021 changed from 1,769,669 ADSs at US$7.26 per ADS to 884,838 ADSs at US$14.36 per ADS. The warrants issued in December 2022 changed from 455,000 ADSs at US$3.70 per ADS to 227,502 ADSs at US$7.24 per ADS.

In the six months ended December 31, 2023, the Group recognized a minimal loss in the Income Statement as remeasurement of borrowing arrangements within finance costs in relation to the adjustment of the carrying amount of the financial liability to reflect the revised estimated future cash flows from the credit facility. In the six months ended December 31, 2022 the Group recognized a loss of $1.4 million in the Income Statement as remeasurement of borrowing arrangements within finance costs. Within this $1.4 million loss, $1.0 million relates to the remeasurement due to additional warrants being issued to Oaktree as a result of the first amendment to the loan agreement and $0.4 million relates to the adjustment of the carrying amount of the financial liability to reflect the revised estimated future cash flows from the credit facility.

The Group has pledged substantially all of its assets as collateral under the loan facility with Oaktree.

NovaQuest Capital Management, L.L.C.

On June 29, 2018, the Group entered into an eight-year, $40.0 million loan and security agreement with NovaQuest before drawing the first tranche of $30.0 million of the principal in July 2018. The additional $10.0 million from the loan will be drawn on marketing approval of remestemcel-L for the treatment of pediatric patients with SR-aGVHD by the FDA. The loan term included an interest only period of approximately four years through until July 8, 2022. All interest and principal payments (i.e. the amortization period) are deferred until the earlier of loan maturity or from after the first commercial sale of remestemcel-L for the treatment in pediatric patients with SR-aGVHD in the United States and other geographies excluding Asia ("remestemcel-L for pediatric SR-aGVHD"). Principal is repayable in equal quarterly instalments over the amortization period of the loan and is subject to the payment cap described below. The loan has a fixed interest rate of 15% per annum. If there are no net sales of remestemcel-L for pediatric SR-aGVHD, the loan is only repayable at maturity. The Group can elect to prepay all outstanding amounts owing at any time prior to maturity, subject to a prepayment charge.

Following approval and first commercial sales, repayments commence based on a percentage of net sales and are limited by a payment cap which is equal to the principal due for the next 12 months, plus accumulated unpaid principal and accrued unpaid interest. During the four-year period commencing July 8, 2022, principal amortizes in equal quarterly instalments payable only after approval and first commercial sales. If in any quarterly period, 25% of net sales of remestemcel-L for pediatric SR-aGVHD exceed the annual payment cap, the Group will pay the payment cap and an additional portion of excess sales which will be used towards the prepayment amount in the event there is an early prepayment of the loan. If in any quarterly period 25% of net sales of remestemcel-L for pediatric SR-aGVHD is less than the annual payment cap, then the payment is limited to 25% of net sales of remestemcel-L for pediatric SR-aGVHD. Any unpaid interest will be added to the principal amounts owing and shall accrue further interest. At maturity date, any unpaid loan balances are repaid.

Because of this relationship of net sales and repayments, changes in our estimated net sales may trigger an adjustment of the carrying amount of the financial liability to reflect the revised estimated cash flows. The carrying amount is recalculated by computing the present value of the revised estimated future cash flows at the financial instrument’s original effective interest rate. The adjustment is recognized in the Income Statement as remeasurement of borrowing arrangements within finance costs in the period the revision is made.

In the six months ended December 31, 2023 and 2022, the Group recognized a loss of $0.1 million and a gain of $0.2 million, respectively, in the Income Statement as remeasurement of borrowing arrangements within finance costs in relation to the adjustment of the carrying amount of our financial liability to reflect the revised estimated future cash flows as a net result of changes to the key assumptions in development timelines.

The Group recognizes a liability as current based on repayments linked to estimates of sales of remestemcel-L. However, if sales of remestemcel-L are higher than estimated, actual repayments will exceed this amount, subject to the annual payment cap described above.

The carrying amount of the loan and security agreement with NovaQuest is subordinated to the Group’s fixed rate loan with the senior creditor, Oaktree. The Group have pledged a portion of our assets relating to the SR-aGVHD product candidate as collateral under the loan facility with NovaQuest.

(ii) Compliance with loan covenants

Our loan facilities with Oaktree and NovaQuest contain a number of covenants that impose operating restrictions on us, which may restrict our ability to respond to changes in our business or take specified actions. The Group has an operating objective to at all times maintain unrestricted cash reserves in excess of six months liquidity. The objective aligns with our loan and security agreement with Oaktree where the Group is currently obliged to maintain a minimum unrestricted cash balance of $35.0 million.

The Group has complied with the financial and other restrictive covenants of its borrowing facilities during the six months ended December 31, 2023 and during the year ended June 30, 2023.

(iii) Net Debt Reconciliation


(in U.S. dollars, in thousands)	As of December 31, 2023	As of June 30, 2023
Cash and cash equivalents	77,554	71,318
Borrowings	(115,762)	(108,763)
Lease liabilities	(6,237)	(7,732)
Warrant liability	(992)	(5,426)
Net Debt(1)	(45,437)	(50,603)

Cash and cash equivalents	77,554	71,318
Gross debt - fixed interest rates	(121,999)	(116,495)
Gross debt - variable interest rates	—	—
Warrant liability	(992)	(5,426)
Net Debt(1)	(45,437)	(50,603)

(1)Net debt amount includes leases and borrowing arrangements.


	Liabilities from financing activities				Other assets
(in U.S. dollars, in thousands)	Borrowings	Leases	Warrant liability	Sub-total	Cash and cash equivalents	Total
Net Debt as at June 30, 2023	(108,763)	(7,732)	(5,426)	(121,921)	71,318	(50,603)
Cash Flows(1)	3,163	2,337	—	5,500	4,940	10,440
Remeasurement adjustments	(120)	—	4,434	4,314	—	4,314
Other Changes(2)	(10,042)	(782)	—	(10,824)	—	(10,824)
Foreign exchange adjustments	—	(60)	—	(60)	1,296	1,236
Net Debt as at December 31, 2023	(115,762)	(6,237)	(992)	(122,991)	77,554	(45,437)

(1)Cash flows include the payments of borrowings, lease liabilities, interest and debt transaction costs which are presented as financing cash flows in the statement of cash flows.

(2)Other changes include modification of leases and accrued interest expenses for borrowings and leases.

(iv) Fair values of borrowing arrangements

The carrying amount of the borrowings at amortized cost in accordance with our accounting policy is a reasonable approximation of fair value.

e. Recognized fair value measurement

(i) Fair value hierarchy

The following table presents the Group's financial assets and financial liabilities measured and recognized at fair value as of December 31, 2023 and June 30, 2023 on a recurring basis, categorized by level according to the significance of the inputs used in making the measurements:


As of December 31, 2023
(in U.S. dollars, in thousands)	Notes	Level 1	Level 2	Level 3	Total
Financial Assets
Financial assets at fair value through other comprehensive income:
Equity securities - biotech sector		—	—	826	826
Total Financial Assets		—	—	826	826

Financial Liabilities
Financial liabilities at fair value through profit or loss:
Contingent consideration	5(e)(iii)	—	—	17,536	17,536
Warrant liabilities	5(e)(vi)	—	—	992	992
Total Financial Liabilities		—	—	18,528	18,528


As of June 30, 2023
(in U.S. dollars, in thousands)	Notes	Level 1	Level 2	Level 3	Total

Financial Assets
Financial assets at fair value through other comprehensive income:
Equity securities - biotech sector		—	—	1,757	1,757
Total Financial Assets		—	—	1,757	1,757

Financial Liabilities
Financial liabilities at fair value through profit or loss:
Contingent consideration	5(e)(iii)	—	—	17,199	17,199
Warrant liabilities	5(e)(vi)	—	—	5,426	5,426
Total Financial Liabilities		—	—	22,625	22,625

There were no transfers between any of the levels for recurring fair value measurements during the period.

The Group’s policy is to recognize transfers into and transfers out of fair value hierarchy levels as at the end of the reporting period.

Level 1: The fair value of financial instruments traded in active markets (such as publicly traded derivatives, trading and financial assets at fair value through other comprehensive income securities) is based on quoted market prices at the end of the reporting period. The quoted market price used for financial assets held by the Group is the current bid price. These instruments are included in level 1.

Level 2: The fair value of financial instruments that are not traded in an active market (for example, foreign exchange contracts) is determined using valuation techniques which maximize the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is the case for provisions (contingent consideration), equity securities (unlisted) and warrant liabilities.

(ii) Valuation techniques used.

The Group did not hold any level 1 and level 2 financial instruments as at December 31, 2023 or June 30, 2023.

The Group’s level 3 assets consists of an investment in unlisted equity securities in the biotechnology sector. Level 3 assets were 100% of total assets measured at fair value as at December 31, 2023 and June 30, 2023. The Group’s level 3 liabilities consist of a contingent consideration provision related to the acquisition of the MSC assets and warrant liabilities related to the warrants granted to Oaktree as part of the debt facility. Level 3 liabilities were 100% of total liabilities measured at fair value as at December 31, 2023 and June 30, 2023. The Group used discounted cash flow analysis to determine the fair value measurements of contingent consideration and used the Black-Scholes valuation method to determine the fair value of warrant liabilities. Refer to Note 5(e)(vi) for the fair value measurement and movements in warrant liability for the period ended December 31, 2023 and June 30, 2023.

(iii) Fair value measurements using significant unobservable inputs (level 3)

The following table presents the changes in level 3 instruments for the six months ended December 31, 2023 and the year ended June 30, 2023.


(in U.S. dollars, in thousands)			Contingent consideration provision
Opening balance - July 1, 2022			23,284
Reclassification during the period			2,686
Charged/(credited) to consolidated income statement:
Remeasurement(1)			(8,771)
Closing balance - June 30, 2023			17,199

Opening balance - July 1, 2023			17,199
Charged/(credited) to consolidated income statement:
Remeasurement(2)			337
Closing balance - December 31, 2023			17,536


(1)In the year ended June 30, 2023 a gain of $8.8 million was recognized on the remeasurement of contingent consideration pertaining to the acquisition of the MSC assets. This remeasurement was a net result of changing the key assumptions of the contingent consideration valuation such as probability of payment, developmental timelines and the increase in valuation as the time period shortens between the valuation date and the potential settlement dates of contingent consideration, including the impact from the complete response from the FDA on the Group's BLA for remestemcel-L for the treatment of pediatric SR-aGVHD in August 2023. The assumptions relating to development timelines were updated to reflect expectations as a result of the complete response.


(2)In the six months ended December 31, 2023 a minimal gain was recognized on the remeasurement of contingent consideration pertaining to the acquisition of the MSC assets. This remeasurement was a net result of changing key assumptions of the contingent consideration valuation such as development timelines and the increase in valuation as the time period shortens between the valuation date and the potential settlement dates of contingent consideration.

(iv) Valuation inputs and relationship to fair

The following table summarizes the quantitative information about the significant unobservable inputs used in level 3 fair value measurements:

(in U.S. dollars, in thousands, except percent data)

Range of inputs
(weighted average)

Description

Fair value
as of
December 31,
2023

Fair value
as of
June 30,
2023

Valuation
technique

Unobservable

inputs(1)

Six Months Ended
December 31,
2023

Year Ended
June 30,
2023

Relationship of
unobservable inputs to
fair value

Contingent consideration provision

17,536

17,199

Discounted cash flows

Risk adjusted discount rate

11%-13%

(12.5%)

11%-13%

(12.5%)

Six months ended December 31, 2023: A change in the discount rate by 0.5% would increase/decrease the fair value by an insignificant amount.

Year ended 30 June, 2023: A change in the discount rate by 0.5% would increase/decrease the fair value by 0.01%.

Expected unit sales price

Various

Six months ended December 31, 2023: A change in the price assumptions by 10% would increase/decrease the fair value by 0.1%.

Year ended 30 June, 2023: A change in the price assumptions by 10% would increase/decrease the fair value by 0.1%.

Expected sales volumes

Various

Six months ended December 31, 2023: A change in the volume assumptions by 10% would increase/decrease the fair value by 0.1%.

Year ended 30 June, 2023: A change in the volume assumptions by 10% would increase/decrease the fair value by 0.1%.

Probability of success and payment

Various

Six months ended December 31, 2023: A change in the probability of success and payment assumptions by 10% and 20% would increase/decrease the fair value by 10.0% and 20.0%, respectively.

Year ended 30 June, 2023: A change in the probability of success and payment assumptions by 10% and 20% would increase/decrease the fair value by 8% and 16%, respectively.

(1)There were no significant inter-relationships between unobservable inputs that materially affect fair values.

(v) Valuation processes

In connection with the acquisition of the MSC assets on October 11, 2013 (the “acquisition date”), an independent valuation of the contingent consideration was carried out by an independent valuer.

For the six months ended December 31, 2023 and the year ended June 30, 2023, the Group has adopted a process to value contingent consideration internally. This valuation has been completed by the Group’s internal valuation team and reviewed by the interim Chief Financial Officer (the "CFO"). The valuation team is responsible for the valuation model. The valuation team also manages a process to continually refine the key assumptions within the model. This is done with input from the relevant business units. The key assumptions in the model have been clearly defined and the responsibility for refining those assumptions has been assigned to the most relevant business units. For each indication we determine the probability of success based on the current development status within each jurisdiction and payment provisions within the agreement. Cash flows relevant to each jurisdiction are discounted appropriately based on the discount rate assumed. The remeasurement charged to the consolidated income statement in the six months ended December 31, 2023 was a net result of changing the key assumptions of the contingent consideration valuation such as development timelines and the increase

in valuation as the time period shortens between the valuation date and the potential settlement dates of contingent consideration. Future discussions with the FDA could lead to a change in the assumptions associated with SR-aGVHD and a remeasurement of contingent consideration, up or down, could occur.


	As of December 31,	As of June 30,
The fair value of contingent consideration (in U.S. dollars, in thousands)	2023	2023
Fair value of cash or stock payable, dependent on achievement of future late-stage clinical or regulatory targets	16,924	16,606
Fair value of royalty payments from commercialization of the intellectual property acquired	612	593
	17,536	17,199

The main level 3 inputs used by the Group are evaluated as follows:


Risk adjusted discount rate:			The discount rate used in the valuation has been determined based on required rates of returns of listed companies in the biotechnology industry (having regards to their stage of development, their size and number of projects) and the indicative rates of return required by suppliers of venture capital for investments with similar technical and commercial risks. This assumption is reviewed as part of the valuation process outlined above.

Expected unit sales prices:			Expected market sale price of the most comparable products currently available in the market place. This assumption is reviewed as part of the valuation process outlined above.

Expected sales volumes:			Expected sales volumes of the most comparable products currently available in the market place. This assumption is reviewed as part of the valuation process outlined above.

Probability of success and payment:			Expected cash flows used to measure contingent consideration are risk adjusted for the probability of successful development of products and payment provisions within the agreement. This assumption is reviewed as part of the valuation process outlined above.

(vi) Warrant liability


(in U.S. dollars, in thousands)	As of December 31,	As of June 30,
Warrant liability	2023	2023
Opening balance	5,426	2,185
Warrants fair value at grant date - December 22, 2022	—	1,036
Remeasurement of warrant liability	(4,434)	2,205
Closing Balance	992	5,426

On November 19, 2021, in connection with the $60.0 million drawdown of the Oaktree debt, Oaktree were granted the right to warrants to purchase 1,769,669 ADSs at $7.26 per ADS, a 15% premium to the 30-day VWAP. Given that Oaktree received an unconditional right to the warrants on November 19, 2021, this date has been determined as the measurement date. The warrants instruments were issued on January 11, 2022, following the required administrative process, and these warrants may be exercised within 7 years of issuance of the warrant instruments. The warrants do not confer any rights to dividends or a right to participate in a new issue without exercising the warrant.

On December 22, 2022, the Group amended the terms of the loan agreement with Oaktree and in connection with the loan amendment, Oaktree was granted warrants to purchase 455,000 ADSs at $3.70 per ADS, a 15% premium to the 30-day VWAP. We determined that an obligation to issue the warrants has arisen from the time the first amendment to the

loan agreement was signed; consequently, a liability for the warrants has been recognized in December 2022. The warrants were legally issued on March 8, 2023 and may be exercised within 7 years of issuance.

On January 5, 2024, the ratio under Mesoblast's ADR program was changed from 5 ordinary shares representing 1 ADS (5:1 ratio) to a new ratio of 10 ordinary shares representing 1 ADS (10:1 ratio). As a result of this ratio change and as a result of completing the pro-rata accelerated non-renounceable rights issue in December 2023, the number and exercise price for the warrants was adjusted in accordance with the terms of these warrants. The warrants issued in November 2021 changed from 1,769,669 ADSs at US$7.26 per ADS to 884,838 ADSs at US$14.36 per ADS. The warrants issued in December 2022 changed from 455,000 ADSs at US$3.70 per ADS to 227,502 ADSs at US$7.24 per ADS.

The exercise price of the warrants will be received in U.S. dollars, which is different to Mesoblast Limited’s functional currency of Australian dollars which gives rise to variability in the cash flow. As a result, the warrants are classified as a financial liability in accordance with IAS32 Financial Instruments: Presentation. The financial liability is recorded in warrant liability at fair value at grant date and subsequently remeasured at each reporting period with changes being recorded in the Income Statement as remeasurement of warrant liability. The warrant liabilities are considered level 3 liabilities as the determination of fair value includes various assumptions about the share prices and historical volatility as inputs.

As at December 31, 2023, and June 30, 2023 the fair value of the warrant liability was $1.0 million and $5.4 million, respectively. During the six months ended December 31, 2023, a remeasurement gain of $4.4 million was recognized on the remeasurement of warrant liability. During the six months ended December 31, 2022, a remeasurement loss of $0.7 million was recognized on the remeasurement of warrant liability.

(vii) Fair value of warrants

The warrants granted are not traded in an active market and therefore the fair value has been estimated by using the Black-Scholes valuation method based on the following assumptions. Key terms of the warrants are included below. The following assumptions were based on observable market conditions that existed at the issue date and as of December 31, 2023.

(in U.S. dollars, except percent data and as otherwise noted)
Assumption

As of
December 31,
2023

As of June 30, 2023

Rationale

Share Price

$1.10

$3.91

Closing share price on valuation date from external market source

Exercise Price

$3.70 to $7.26

As per subscription agreement

Expected Term

5 to 7 years

6 to 7 years

As per subscription agreement

Dividend Yield

Based on Company’s nil dividend history

Expected Volatility

86.71%

81.26%

Based on historical volatility data for the Company

Risk Free Interest Rate

3.88%

4.01%

Based on the closing U.S treasury issued 7 year bonds on valuation date

Fair value per warrant

$0.4000 to $0.6248

$2.3103 to $2.9401

Determined using Black-Scholes valuation model with the inputs above

Fair value

$992,233

$5,426,212

Fair value of 2,224,669 warrants of $992,233 and $5,426,212 as of December 31, 2023 and June 30, 2023, respectively.

Financial assets and liabilities - Summary of Changes in Fair Value of Level 3 Instruments (Parenthetical) (Details) $ in Millions	12 Months Ended
	Jun. 30, 2023 USD ($)
Level 3
Disclosure Of Financial Instruments [Line Items]
Gain on re-measurement of contingent consideration provision	$ 8.8

Financial assets and liabilities - Summary of Valuation Processes of Contingent Consideration at Fair Value (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Jun. 30, 2023
Disclosure Of Financial Assets And Liabilities [Abstract]
Fair value of cash or stock payable, dependent on achievement of future late-stage clinical or regulatory targets	$ 16,924	$ 16,606
Fair value of royalty payments from commercialization of the intellectual property acquired	612	593
Contingent Consideration	$ 17,536	$ 17,199

Financial risk management - Schedule of Deposits Held which Derive Interest Revenue Together with the Maximum and Minimum Interest Rates Being Earned (Parenthetical) (Details) - Interest Rate Risk	6 Months Ended	12 Months Ended
	Dec. 31, 2023	Jun. 30, 2023
USD
Disclosure of Financial Risk Management [Line Items]
Effect on profit from change in interest rate increase or decrease	10.00%	10.00%
AUD
Disclosure of Financial Risk Management [Line Items]
Effect on profit from change in interest rate increase or decrease	10.00%	10.00%

Non-financial assets and liabilities (Tables)

6 Months Ended

Dec. 31, 2023

Disclosure Of Non Financial Assets And Liabilities [Abstract]

Summary of Intangible Assets

Intangible assets


(in U.S. dollars, in thousands)	Goodwill	Acquired licenses to patents	In-process research and development acquired	Current marketed products	Total
Year Ended June 30, 2023
Opening net book amount	134,453	1,632	427,779	14,788	578,652
Additions	—	23	—	—	23
Exchange differences	—	1	—	—	1
Amortization charge	—	(38)	—	(1,455)	(1,493)
Closing net book amount	134,453	1,618	427,779	13,333	577,183

As of June 30, 2023
Cost	134,453	2,993	489,698	23,999	651,143
Accumulated amortization	—	(1,375)	—	(10,666)	(12,041)
Accumulated impairment	—	—	(61,919)	—	(61,919)
Net book amount	134,453	1,618	427,779	13,333	577,183

Six Months Ended December 31, 2023
Opening net book amount	134,453	1,618	427,779	13,333	577,183
Additions	—	122	—	—	122
Exchange differences	—	1	—	—	1
Amortization charge	—	(15)	—	(727)	(742)
Closing net book amount	134,453	1,726	427,779	12,606	576,564

As of December 31, 2023
Cost	134,453	3,131	489,698	24,000	651,282
Accumulated amortization	—	(1,405)	—	(11,394)	(12,799)
Accumulated impairment	—	—	(61,919)	—	(61,919)
Net book amount	134,453	1,726	427,779	12,606	576,564

Summary of Carrying Value of In Process Research and Development Acquired by Product

Carrying value of in-process research and development acquired by product


(in U.S. dollars, in thousands)	As of December 31, 2023	As of June 30, 2023
Cardiovascular products(1)	254,351	254,351
Intravenous products for metabolic diseases and inflammatory/immunologic conditions(2)	70,730	70,730
MSC products(3)	102,698	102,698
	427,779	427,779

(1)Includes MPC-150-IM for the treatment or prevention of chronic heart failure and MPC-25-IC for the treatment or prevention of acute myocardial infarction

(2)Includes MPC-300-IV for the treatment of biologic-refractory rheumatoid arthritis and diabetic nephropathy

(3)Includes remestemcel-L for the treatment of adults and children with SR-aGVHD and remestemcel-L for the treatment of Crohn’s disease

Summary of Provisions


	As of December 31, 2023			As of June 30, 2023
(in U.S. dollars, in thousands)	Current	Non-current	Total	Current	Non-current	Total
Contingent consideration(1)	500	17,036	17,536	636	16,563	17,199
Employee benefits	3,980	37	4,017	2,013	49	2,062
Provision for license agreements	3,750	—	3,750	3,750	—	3,750
	8,230	17,073	25,303	6,399	16,612	23,011

(1) The classification of contingent consideration as current represents the expected payments within the next 12 months based on current development timelines.

Summary of Deferred Tax Balances

Deferred tax balances


(in U.S. dollars, in thousands)	As of December 31, 2023	As of June 30, 2023
Deferred tax assets
The balance comprises temporary differences attributable to:
Tax losses	74,684	76,020
Other temporary differences	13,185	11,972
Total deferred tax assets	87,869	87,992

Deferred tax liabilities
The balance comprises temporary differences attributable to:
Intangible assets	87,869	87,992
Total deferred tax liabilities	87,869	87,992
Net deferred tax liabilities	—	—

Schedule of Movements Related to Deferred Tax Assets and Liabilities

Movements


(in U.S. dollars, in thousands)	Tax losses(1) (DTA)	Other temporary differences(1) (DTA)	Intangible assets (DTL)	Total (DTL)
As of June 30, 2022	(80,411)	(7,831)	88,242	—
Charged/(credited) to:
- profit or loss	4,179	(4,141)	(250)	(212)
- directly to equity	212	—	—	212
As of June 30, 2023	(76,020)	(11,972)	87,992	—
Charged/(credited) to:
- profit or loss	1,234	(1,213)	(123)	(102)
- directly to equity	102	—	—	102
As of December 31, 2023	(74,684)	(13,185)	87,869	—

(1)Deferred tax assets are netted against deferred tax liabilities

Cash flow information (Details) - USD ($) $ in Thousands	6 Months Ended		12 Months Ended
Cash flow information (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022	Jun. 30, 2023	Jun. 30, 2022
Reconciliation of cash and cash equivalents
Cash at bank	$ 77,144		$ 70,920
Deposits at call	410		398
Cash and cash equivalents	77,554	$ 67,619	71,318	$ 60,447
Cash flows from operating activities
Loss for the period	(32,539)	(41,370)
Add/(deduct) net loss for non-cash items as follows:
Depreciation and amortization	2,443	2,190
Foreign exchange (gains)/losses	(159)	193
Finance costs	10,319	10,685
Remeasurement of contingent consideration	337	(5,989)
Remeasurement of warrant liabilities	(4,434)	712	$ 2,205
Equity settled share-based payment	2,195	1,757
Deferred tax benefit	(102)	(126)
Change in operating assets and liabilities:
Decrease/(increase) in trade and other receivables	2,084	(743)
Decrease/(increase) in prepayments	(131)	(424)
Decrease/(increase) in tax incentive recoverable	1,094	0
Increase/(decrease) in trade creditors and accruals	(9,500)	2,608
Increase/(decrease) in provisions	1,821	(234)
Net cash (outflows) in operating activities	$ (26,572)	$ (30,741)

Financial risk management - Schedule of Deposits Held which Derive Interest Revenue Together with the Maximum and Minimum Interest Rates Being Earned (Details) - Interest Rate Risk $ in Thousands, $ in Thousands	6 Months Ended		12 Months Ended
	Dec. 31, 2023 USD ($)	Dec. 31, 2023 AUD ($)	Jun. 30, 2023 USD ($)	Jun. 30, 2023 AUD ($)
USD
Disclosure of Financial Risk Management [Line Items]
Funds invested	$ 49,950		$ 40,569
Rate increase on funds invested	92		73
Rate decrease on funds invested	$ (92)		$ (73)
USD \| Bottom of Range
Disclosure of Financial Risk Management [Line Items]
Funds invested percentage	1.84%	1.84%	1.79%	1.79%
Rate increase	2.02%	2.02%	1.97%	1.97%
Rate decrease	1.66%	1.66%	1.61%	1.61%
USD \| Top of Range
Disclosure of Financial Risk Management [Line Items]
Funds invested percentage	1.84%	1.84%	1.79%	1.79%
Rate increase	2.02%	2.02%	1.97%	1.97%
Rate decrease	1.66%	1.66%	1.61%	1.61%
AUD
Disclosure of Financial Risk Management [Line Items]
Funds invested		$ 35,466		$ 35,707
Rate increase on funds invested		151		143
Rate decrease on funds invested		$ (151)		$ (143)
AUD \| Bottom of Range
Disclosure of Financial Risk Management [Line Items]
Funds invested percentage	3.85%	3.85%	3.60%	3.60%
Rate increase	4.24%	4.24%	3.96%	3.96%
Rate decrease	3.47%	3.47%	3.24%	3.24%
AUD \| Top of Range
Disclosure of Financial Risk Management [Line Items]
Funds invested percentage	4.88%	4.88%	4.59%	4.59%
Rate increase	5.37%	5.37%	5.05%	5.05%
Rate decrease	4.39%	4.39%	4.13%	4.13%

Non-financial assets and liabilities - Summary of Intangible Assets (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Dec. 31, 2023	Jun. 30, 2023
Disclosure Of Intangible Assets [Line Items]
Opening net book amount	$ 577,183	$ 578,652
Additions	122	23
Exchange differences	1	1
Amortization charge	(742)	(1,493)
Closing net book amount	576,564	577,183
Cost
Disclosure Of Intangible Assets [Line Items]
Opening net book amount	651,143
Closing net book amount	651,282	651,143
Accumulated amortization
Disclosure Of Intangible Assets [Line Items]
Opening net book amount	(12,041)
Closing net book amount	(12,799)	(12,041)
Accumulated impairment
Disclosure Of Intangible Assets [Line Items]
Opening net book amount	(61,919)
Closing net book amount	(61,919)	(61,919)
Goodwill
Disclosure Of Intangible Assets [Line Items]
Opening net book amount	134,453	134,453
Closing net book amount	134,453	134,453
Goodwill \| Cost
Disclosure Of Intangible Assets [Line Items]
Opening net book amount	134,453
Closing net book amount	134,453	134,453
Acquired licenses to patents
Disclosure Of Intangible Assets [Line Items]
Opening net book amount	1,618	1,632
Additions	122	23
Exchange differences	1	1
Amortization charge	(15)	(38)
Closing net book amount	1,726	1,618
Acquired licenses to patents \| Cost
Disclosure Of Intangible Assets [Line Items]
Opening net book amount	2,993
Closing net book amount	3,131	2,993
Acquired licenses to patents \| Accumulated amortization
Disclosure Of Intangible Assets [Line Items]
Opening net book amount	(1,375)
Closing net book amount	(1,405)	(1,375)
In-process research and development acquired
Disclosure Of Intangible Assets [Line Items]
Opening net book amount	427,779	427,779
Exchange differences	0
Closing net book amount	427,779	427,779
In-process research and development acquired \| Cost
Disclosure Of Intangible Assets [Line Items]
Opening net book amount	489,698
Closing net book amount	489,698	489,698
In-process research and development acquired \| Accumulated impairment
Disclosure Of Intangible Assets [Line Items]
Opening net book amount	(61,919)
Closing net book amount	(61,919)	(61,919)
Current marketed products
Disclosure Of Intangible Assets [Line Items]
Opening net book amount	13,333	14,788
Exchange differences	0	0
Amortization charge	(727)	(1,455)
Closing net book amount	12,606	13,333
Current marketed products \| Cost
Disclosure Of Intangible Assets [Line Items]
Opening net book amount	23,999
Closing net book amount	24,000	23,999
Current marketed products \| Accumulated amortization
Disclosure Of Intangible Assets [Line Items]
Opening net book amount	(10,666)
Closing net book amount	$ (11,394)	$ (10,666)

Consolidated Income Statement - USD ($) $ in Thousands	6 Months Ended
Consolidated Income Statement - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Profit or loss [abstract]
Revenue	$ 3,388	$ 3,422
Research & development	(12,647)	(13,430)
Manufacturing commercialization	(6,746)	(12,760)
Management and administration	(11,482)	(13,281)
Fair value remeasurement of contingent consideration	(337)	5,989
Fair value remeasurement of warrant liability	4,434	(712)
Other operating income and expenses	1,068	(39)
Finance costs	(10,319)	(10,685)
Loss before income tax	(32,641)	(41,496)
Income tax benefit/(expense)	102	126
Loss attributable to the owners of Mesoblast Limited	$ (32,539)	$ (41,370)
Earnings per share [abstract]
Basic - losses per share (in dollars per share)	$ (0.0382)	$ (0.0564)
Diluted - losses per share (in dollars per share)	$ (0.0382)	$ (0.0564)

Equity - Summary of Movements in Ordinary Share Capital (Details) - USD ($) $ in Thousands	6 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Disclosure Of Classes Of Share Capital [Line Items]
Beginning balance	$ 501,838	$ 497,044
Issues of ordinary shares during the period
Ending balance	$ 508,731	$ 500,002
Issued Capital
Disclosure Of Classes Of Share Capital [Line Items]
Beginning balance (in shares)	814,204,825	650,454,551
Beginning balance	$ 1,249,123	$ 1,165,309
Issues of ordinary shares during the period
Transaction costs arising on share issue (in shares)	0	0
Transaction costs arising on share issue	$ (2,602)	$ (2,660)
Total contributions of equity during the period (in shares)	201,137,412	86,666,667
Total contributions of equity during the period	$ 37,106	$ 42,405
Share options reserve transferred to equity on exercise of options (in shares)	0	0
Share options reserve transferred to equity on exercise of options	$ 0	$ 0
Ending balance (in shares)	1,015,342,237	737,121,218
Ending balance	$ 1,286,229	$ 1,207,714
Issued Capital \| Placement Agreement
Issues of ordinary shares during the period
Placement of shares under a share placement agreement (in shares)	201,137,412	86,666,667
Placement of shares under a share placement agreement	$ 39,708	$ 45,065

Financial assets and liabilities - Summary of Prepayments (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Jun. 30, 2023
Disclosure Of Financial Assets And Liabilities [Abstract]
Clinical trial research and development expenditure	$ 23	$ 950
Prepaid insurance and subscriptions	3,219	2,025
Other	360	367
Prepayments	$ 3,602	$ 3,342

Non-financial assets and liabilities - Additional Information (Details) - USD ($)		6 Months Ended
	Mar. 31, 2023	Dec. 31, 2023	Jun. 30, 2023
Employee benefits
Disclosure Of Non Financial Assets And Liabilities [Line Items]
Current provisions for accrued annual leave		$ 1,200,000	$ 1,100,000
Bottom of Range \| Discounted cash flow
Disclosure Of Non Financial Assets And Liabilities [Line Items]
Post tax discount rates		13.80%
Expected patent expiry		9 years
Top of Range \| Discounted cash flow
Disclosure Of Non Financial Assets And Liabilities [Line Items]
Post tax discount rates		15.50%
Expected patent expiry		25 years
In-process research and development acquired
Disclosure Of Non Financial Assets And Liabilities [Line Items]
Impairment loss recognised in profit or loss	$ 0
Goodwill
Disclosure Of Non Financial Assets And Liabilities [Line Items]
Impairment loss recognised in profit or loss	$ 0

Financial assets and liabilities - Summary of Financial Instruments (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Jun. 30, 2023	Dec. 31, 2022	Jun. 30, 2022
Disclosure Of Financial Assets And Liabilities [Line Items]
Cash & cash equivalents	$ 77,554	$ 71,318	$ 67,619	$ 60,447
Trade & other receivables	3,998	6,998
Financial assets at fair value through other comprehensive income	826	1,757
Other non-current assets	2,241	2,326
Financial assets, Total	84,619	82,399
Trade and other payables	10,760	20,145
Borrowings	115,762	108,763
Contingent consideration	17,536	17,199
Warrant liability	992	5,426		$ 2,185
Financial liabilities, Total	145,050	151,533
Liabilities at amortized cost
Disclosure Of Financial Assets And Liabilities [Line Items]
Trade and other payables	10,760	20,145
Borrowings	115,762	108,763
Financial liabilities, Total	126,522	128,908
Liabilities at FVTPL
Disclosure Of Financial Assets And Liabilities [Line Items]
Contingent consideration	17,536	17,199
Warrant liability	992	5,426
Financial liabilities, Total	18,528	22,625
Assets at amortized cost
Disclosure Of Financial Assets And Liabilities [Line Items]
Cash & cash equivalents	77,554	71,318
Trade & other receivables	3,998	6,998
Other non-current assets	2,241	2,326
Financial assets, Total	83,793	80,642
Assets at FVOCI
Disclosure Of Financial Assets And Liabilities [Line Items]
Financial assets at fair value through other comprehensive income	826	1,757
Financial assets, Total	$ 826	$ 1,757

Financial assets and liabilities - Summary of Quantitative Information About the Significant Unobservable Inputs Used in Level 3 Fair Value Measurements (Details) - Level 3 - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Dec. 31, 2023	Jun. 30, 2023	Jun. 30, 2022
Disclosure Of Financial Instruments [Line Items]
Contingent consideration provision	$ 17,536	$ 17,199	$ 23,284
Unobservable inputs	Expected unit sales price
Expected unit sales price
Disclosure Of Financial Instruments [Line Items]
Percentage of reasonably possible increase (decrease) in unobservable input, liabilities	0.10	0.10
Percentage of reasonably possible increase (decrease) in fair value measurement due to change in unobservable input, liabilities	0.001	0.001
Probability of Success
Disclosure Of Financial Instruments [Line Items]
Unobservable inputs	Probability of success and payment
Probability of Success \| Probability of success
Disclosure Of Financial Instruments [Line Items]
Percentage of reasonably possible increase (decrease) in unobservable input, liabilities	0.10	0.10
Percentage of reasonably possible increase (decrease) in fair value measurement due to change in unobservable input, liabilities	0.100	0.08
Probability of Success \| Payment assumptions
Disclosure Of Financial Instruments [Line Items]
Percentage of reasonably possible increase (decrease) in unobservable input, liabilities	0.20	0.20
Percentage of reasonably possible increase (decrease) in fair value measurement due to change in unobservable input, liabilities	0.200	0.16
Expected Sales Volume
Disclosure Of Financial Instruments [Line Items]
Unobservable inputs	Expected sales volumes
Expected Sales Volume \| Expected sales volumes
Disclosure Of Financial Instruments [Line Items]
Percentage of reasonably possible increase (decrease) in unobservable input, liabilities	0.10	0.10
Percentage of reasonably possible increase (decrease) in fair value measurement due to change in unobservable input, liabilities	0.001	0.001
Discounted cash flow
Disclosure Of Financial Instruments [Line Items]
Contingent consideration provision	$ 17,536	$ 17,199
Valuation technique	Discounted cash flows
Unobservable inputs	Risk adjusted discount rate
Discounted cash flow \| Risk adjusted discount rate
Disclosure Of Financial Instruments [Line Items]
Percentage of reasonably possible increase (decrease) in unobservable input, liabilities	0.005	0.005
Percentage of reasonably possible increase (decrease) in fair value measurement due to change in unobservable input, liabilities		0.0001
Discounted cash flow \| Bottom of Range
Disclosure Of Financial Instruments [Line Items]
Range of inputs (weighted average)	11.00%	11.00%
Discounted cash flow \| Top of Range
Disclosure Of Financial Instruments [Line Items]
Range of inputs (weighted average)	13.00%	13.00%
Discounted cash flow \| Weighted Average
Disclosure Of Financial Instruments [Line Items]
Range of inputs (weighted average)	(12.50%)	(12.50%)

Basis of preparation	6 Months Ended
Basis of preparation	Dec. 31, 2023
Basis Of Preparation [Abstract]
Basis of preparation	Basis of preparation Mesoblast Limited is a for-profit entity for the purpose of preparing the financial statements. The condensed consolidated financial statements of Mesoblast Limited and its subsidiaries have been prepared in accordance with International Accounting Standard IAS 34 Interim Financial Reporting, as issued by the International Accounting Standards Board (“IASB”), and are unaudited. These condensed interim financial statements do not include all of the notes and disclosures required by International Financial Reporting Standards, as issued by the IASB, for annual consolidated financial statements and should therefore be read in conjunction with our annual report on Form 20-F for the year ended June 30, 2023. In the opinion of management, the interim financial data includes all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the results for the interim periods. (i) Going concern As of December 31, 2023, the Group held total cash reserves of $77.6 million. During the six months ended December 31, 2023, the Group executed on reprioritization of projects and operational streamlining activities and as a result has reduced net cash usage for operating activities, which was $26.6 million the six months ended December 31, 2023, a reduction of 14% compared to the prior period. In line with the Group's overall commercial strategy to complete additional pivotal clinical studies for both the Group's chronic lower back pain and steroid-refractory acute graft versus host disease ("SR-aGVHD") product candidates, additional inflows from capital markets, royalty monetization, strategic partnerships or product specific financing will be required to meet the Group's projected expenditure consistent with the Group's business strategy over at least the next 12 months. As a result of these matters, there is material uncertainty related to events or conditions that may cast significant doubt (or raise substantial doubt as contemplated by Public Company Accounting Oversight Board (“PCAOB”) standards) on the Group’s ability to continue as a going concern and, therefore, that the Group may be unable to realize its assets and discharge its liabilities in the normal course of business. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. (ii) Historical cost convention These financial statements have been prepared under the historical cost convention, as modified by the revaluation of financial assets at fair value through other comprehensive income, financial assets and liabilities (including derivative instruments) at fair value through profit or loss, certain classes of property, plant and equipment and investment property. (iii) New and amended standards adopted by the Group There were no new or amended standards adopted by the Group in the six months ended December 31, 2023. These interim financial statements follow the same accounting policies as compared to the June 30, 2023 consolidated financial statements and related notes as filed with the Australian Securities Exchange and the Securities and Exchange Commission. (iv) New accounting standards and interpretations not yet adopted by the Group There were no new accounting standards and interpretations not yet adopted by the Group for the December 31, 2023 reporting period that are expected to materially impact the Group. (v) Use of estimates The preparation of these consolidated financial statements requires the Group to make estimates and judgments that affect the reported amounts of assets, liabilities, income and expenses and related disclosures. On an ongoing basis, the Group evaluates its significant accounting policies and estimates. Estimates are based on historical experience and on various market-specific and other relevant assumptions that the Group believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities. (vi) Impact of after effects of COVID-19 and geopolitical instability Estimates are assessed each period and updated to reflect current information, such as the economic considerations related to the after effects of the COVID-19 pandemic could have on the Group’s significant accounting estimates. The Group is having to account for the after effects of the COVID-19 pandemic on healthcare network, which have been and may continue to be impacted by the pandemic with respect to patient care, operations/staffing, financials, and health and safety protocols. These impacts change the way that Mesoblast will have to engage with relevant collaborators. Due to the effects of the COVID-19 pandemic and recent geopolitical instability, countries in which the Group has operations have experienced some challenges in the ability of the Group’s suppliers and contractors to source, supply or acquire raw materials or components needed for its manufacturing process and supply chain. As a result, the manufacturing and commercialization of remestemcel-L and other product candidates could be adversely affected.

Financial assets and liabilities - Summary of Financial Assets and Liabilities Measured and Recognized at Fair Value (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Jun. 30, 2023	Jun. 30, 2022
Financial assets at fair value through other comprehensive income:
Total Financial Assets	$ 826	$ 1,757
Financial liabilities at fair value through profit or loss:
Contingent consideration	17,536	17,199
Warrant liabilities	992	5,426	$ 2,185
Total Financial Liabilities	18,528	22,625
Level 1
Financial assets at fair value through other comprehensive income:
Total Financial Assets	0	0
Financial liabilities at fair value through profit or loss:
Contingent consideration	0	0
Warrant liabilities	0	0
Total Financial Liabilities	0	0
Level 2
Financial assets at fair value through other comprehensive income:
Total Financial Assets	0	0
Financial liabilities at fair value through profit or loss:
Contingent consideration	0	0
Warrant liabilities	0	0
Total Financial Liabilities	0	0
Level 3
Financial assets at fair value through other comprehensive income:
Total Financial Assets	826	1,757
Financial liabilities at fair value through profit or loss:
Contingent consideration	17,536	17,199
Warrant liabilities	992	5,426
Total Financial Liabilities	18,528	22,625
Equity Securities
Financial assets at fair value through other comprehensive income:
Total Financial Assets	826	1,757
Equity Securities \| Level 1
Financial assets at fair value through other comprehensive income:
Total Financial Assets	0	0
Equity Securities \| Level 2
Financial assets at fair value through other comprehensive income:
Total Financial Assets	0	0
Equity Securities \| Level 3
Financial assets at fair value through other comprehensive income:
Total Financial Assets	$ 826	$ 1,757

Equity (Tables)

6 Months Ended

Dec. 31, 2023

Disclosure of classes of share capital [abstract]

Schedule of Share Capital

Share capital


	As of December 31,
	2023	2022	2023	2022
	Shares No.		(U.S. dollars, in thousands)
Contributed equity
(i)Share capital
Ordinary shares	1,015,342,237	737,121,218	1,286,229	1,207,714
Less: Treasury Shares	(542,903)	(542,903)	—	—
Total Contributed Equity	1,014,799,334	736,578,315	1,286,229	1,207,714

Summary of Movements in Ordinary Share Capital

Movements in ordinary share capital


	Six Months Ended December 31,		Six Months Ended December 31,
	2023	2022	2023	2022
	Shares No.		(U.S. dollars, in thousands)
Opening balance	814,204,825	650,454,551	1,249,123	1,165,309
Issues of ordinary shares during the period
Placement of shares under a share placement agreement(1)(2)	201,137,412	86,666,667	39,708	45,065
Transaction costs arising on share issue	—	—	(2,602)	(2,660)
Total contributions of equity during the period	201,137,412	86,666,667	37,106	42,405
Share options reserve transferred to equity on exercise of options	—	—	—	—
Ending balance	1,015,342,237	737,121,218	1,286,229	1,207,714


(1)During the six months ended December 31, 2023, 201,137,412 shares were issued in a 1 for 4 pro-rata accelerated non-renounceable entitlement offer of new fully paid ordinary shares in Mesoblast Limited to existing shareholders in Australia and certain other countries together with an institutional placement of new fully paid ordinary shares in Mesoblast Limited, at A$0.30 per share.

(2)During the six months ended December 31, 2022, 86,666,667 shares were issued in an equity purchase of Mesoblast Limited at A$0.75 per share to existing and new institutional investors.

Summary of Movements of Shares in Share Trust

Movements of shares in share trust


	Six Months Ended December 31,		Six Months Ended December 31,
	2023	2022	2023	2022
	Shares No.		(U.S. dollars, in thousands)
Opening balance	542,903	542,903	—	—
Movement of shares in share trust
Exercise of share options(1)	—	—	—	—
Ending balance	542,903	542,903	—	—


(1)Options are issued to employees, directors and consultants in accordance with the Mesoblast Employee Share Option Plan. From July 1, 2020, unpaid shares are issued to the share trust to enable future option exercises to be settled. On exercise of options, the proceeds of the exercise are recorded in ordinary share capital in Mesoblast Limited and the exercise is settled by transfer of the shares from the share trust to the employee. Prior to July 1, 2020, the shares issued and share capital received on the exercise of options were recorded in ordinary share capital.

Summary of Warrant Reserve

Warrant reserve


(in U.S. dollars, in thousands)	As of December 31,	As of June 30,
Warrant reserve	2023	2023
Opening balance	12,969	12,969
Movement during the period	—	—
Closing Balance	12,969	12,969

Significant changes in the current reporting period	6 Months Ended
Significant changes in the current reporting period	Dec. 31, 2023
Disclosure Of Significant Changes In Current Reporting Period [Abstract]
Significant changes in the current reporting period	Significant changes in the current reporting period (i) Significant events The financial position and performance of the Group was affected by the following event during the six months ended December 31, 2023. •In August 2023, the FDA provided a complete response to the Group's BLA resubmission for remestemcel-L for the treatment of pediatric SR-aGVHD and requires more data to support marketing approval, including potency assay or clinical data. In line with the Group's overall commercial strategy to progress to adult populations, the Group intends to conduct a targeted, controlled study in the highest-risk adults with the greatest mortality. Assumptions associated with SR-aGVHD are included within the impairment assessment of MSC products within in-process research and development and goodwill, contingent consideration, pre-launch inventory and the NovaQuest borrowings on the consolidated balance sheet and forecast net operating cash usage. The Group assessed and included the impact of the FDA's complete response to the Group's BLA resubmission for remestemcel-L for the treatment of pediatric SR-aGVHD in these areas within the Form 20-F for the year ended June 30, 2023. •In September 2023, the Group provided an update on the path to approval for lead-product candidate remestemcel-L in the treatment of pediatric and adult SR-aGvHD, following a Type A meeting held with FDA. Future discussions with the FDA could lead to a change in the assumptions associated with SR-aGVHD within the impairment assessment of MSC products within in-process research and development and goodwill, contingent consideration, pre-launch inventory and the NovaQuest borrowings on the consolidated balance sheet and forecast net operating cash usage. •In December 2023 the Group completed an institutional placement together with a 1 for 4 pro-rata accelerated non-renounceable entitlement offer of new fully paid ordinary shares in Mesoblast Limited to existing eligible shareholders, raising A$60.3 million at an issue price of A$0.30 per share. In December 2023, proceeds of $39.7 million (A$60.3 million) were received and recognized in cash and cash equivalents.

Consolidated Statement of Changes in Equity - USD ($) $ in Thousands	Total	Issued Capital	Share Option Reserve	Investment Revaluation Reserve	Foreign Currency Translation Reserve	Warrant Reserve	(Accumulated losses)
Beginning balance at Jun. 30, 2022	$ 497,044	$ 1,165,309	$ 97,924	$ (542)	$ (39,700)	$ 12,969	$ (738,916)
Loss for the period	(41,370)						(41,370)
Other comprehensive income/(loss)	292			192	100
Total comprehensive profit/(loss) for the period	(41,078)			192	100		(41,370)
Transactions with owners in their capacity as owners:
Contributions of equity net of transaction costs	42,405	42,405
Transactions with owners in their capacity as owners	42,405	42,405
Tax credited / (debited) to equity	(126)		(126)
Transfer of exercised options	0	0	0
Fair value of share-based payments	1,757		1,757
Increase (decrease) in equity	1,631	0	1,631			0
Ending balance at Dec. 31, 2022	500,002	1,207,714	99,555	(350)	(39,600)	12,969	(780,286)
Beginning balance at Jun. 30, 2022	497,044	1,165,309	97,924	(542)	(39,700)	12,969	(738,916)
Ending balance at Jun. 30, 2023	501,838	1,249,123	101,367	(543)	(40,273)	12,969	(820,805)
Loss for the period	(32,539)						(32,539)
Other comprehensive income/(loss)	233			(931)	1,164
Total comprehensive profit/(loss) for the period	(32,306)			(931)	1,164		(32,539)
Transactions with owners in their capacity as owners:
Contributions of equity net of transaction costs	37,106	37,106
Transactions with owners in their capacity as owners	37,106	37,106
Tax credited / (debited) to equity	(102)		(102)
Transfer of exercised options		0	0
Fair value of share-based payments	2,195		2,195
Increase (decrease) in equity	2,093	0	2,093
Ending balance at Dec. 31, 2023	$ 508,731	$ 1,286,229	$ 103,460	$ (1,474)	$ (39,109)	$ 12,969	$ (853,344)

(Losses) per share (Tables)

6 Months Ended

Dec. 31, 2023

Earnings per share [abstract]

Summary of (Losses) Earnings Per Share

Six Months Ended

December 31,
2023

December 31,
2022

Cents

(Losses) per share

(in cents)

(a) Basic (losses) per share

From continuing operations attributable to the ordinary equity holders of the company

(3.82)

(5.64)

Total basic (losses) per share attributable to the ordinary equity holders of the company

(3.82)

(5.64)

(b) Diluted (losses) per share

From continuing operations attributable to the ordinary equity holders of the company

(3.82)

(5.64)

Total diluted (losses) per share attributable to the ordinary equity holders of the company

(3.82)

(5.64)

(in U.S. dollars, in thousands)

Basic (losses) per share

(Losses) attributable to the ordinary equity holders of the company used in calculating basic (losses) per share:

From continuing operations

(32,539)

(41,370)

Diluted (losses) per share

(Losses) from continuing operations attributable to the ordinary equity holders of the company:

Used in calculating basic (losses) per share

(32,539)

(41,370)

(Losses) attributable to the ordinary equity holders of the company used in calculating diluted losses per share

(32,539)

(41,370)

Six Months Ended

December 31,
2023

December 31,
2022

(In Shares)

Weighted average number of ordinary shares used as the denominator in calculating basic losses per share

851,464,145

733,282,900

Weighted average number of ordinary shares and potential ordinary shares used in calculating diluted losses per share

851,464,145

733,282,900

Loss before income tax

6 Months Ended

Dec. 31, 2023

Disclosure Of Loss Before Income Tax [Abstract]

Loss before income tax


		Six Months Ended December 31,
(in U.S. dollars, in thousands)	Note	2023	2022
Revenue
Commercialization revenue		3,388	3,422
Total Revenue		3,388	3,422

Clinical trial and research & development		(2,045)	(4,067)
Manufacturing production & development		(5,484)	(11,717)

Employee benefits
Salaries and employee benefits		(10,096)	(9,842)
Defined contribution superannuation expenses		(199)	(186)
Equity settled share-based payment transactions(1)		(2,195)	(1,757)
Total Employee benefits		(12,490)	(11,785)

Depreciation and amortization of non-current assets
Plant and equipment depreciation		(281)	(565)
Right of use asset depreciation		(1,420)	(875)
Intellectual property amortization		(742)	(750)
Total Depreciation and amortization of non-current assets		(2,443)	(2,190)

Other Management & administration expenses
Overheads & administration		(4,594)	(5,187)
Consultancy		(1,285)	(1,967)
Legal and other professional fees		(1,124)	(1,053)
Intellectual property expenses (excluding the amount amortized above)		(1,410)	(1,505)
Total Other Management & administration expenses(2)		(8,413)	(9,712)

Fair value remeasurement of contingent consideration
Remeasurement of contingent consideration	5(e)(iii)	(337)	5,989
Total Fair value remeasurement of contingent consideration		(337)	5,989

Fair value remeasurement of warrant liability
Remeasurement of warrant liability	5(e)(vi)	4,434	(712)
Total Fair value remeasurement of warrant liability		4,434	(712)

Other operating income and expenses
Interest revenue		903	214
Foreign exchange gains/(losses)		165	(253)
Total Other operating income and expenses		1,068	(39)

Finance (costs)/gains
Remeasurement of borrowing arrangements		(120)	(1,230)
Interest expense		(10,199)	(9,455)
Total Finance costs		(10,319)	(10,685)

Total loss before income tax		(32,641)	(41,496)

(1)Share-based payment transactions

For the six months ended December 31, 2023 and 2022, the share-based payment transactions have been reflected in the Consolidated Income Statement functional expense categories as follows:


	Six Months Ended December 31,
(in U.S. dollars)	2023	2022
Research and development	1,104,007	797,058
Manufacturing and commercialization	48,064	(183,720)
Management and administration	1,043,365	1,143,560
Equity settled share-based payment transactions	2,195,436	1,756,898

(2)Change in comparative figures

For the six months ended December 31, 2022, the Group reclassified immaterial amounts within Other Management and administration expenses. The Group does not believe these reclassifications to be material to the consolidated financial statements.

Revenue recognition

Grünenthal arrangement

In September 2019, the Group entered into a strategic partnership with Grünenthal for the development and commercialization in Europe and Latin America of the Group’s allogeneic mesenchymal precursor cell (“MPC”) product, MPC-06-ID, receiving exclusive rights to the Phase 3 allogeneic product candidate for the treatment of low back pain due to degenerative disc disease.

The Group received a non-refundable upfront payment of $15.0 million in October 2019, on signing of the contract with Grünenthal. The Group received a milestone payment in December 2019 of $2.5 million in relation to meeting a milestone event as part of the strategic partnership with Grünenthal.

In June 2022, the Group announced its intention to leverage the results from a planned US trial to support potential product approvals in both the US and EU by including 20% EU patients in order to provide regulatory harmonization, cost efficiencies and streamlined timelines, without initiating an EU trial. As a result, the strategic partnership with Grünenthal has been amended, and milestone payments relating to R&D and CMC services and other development services which were linked to the Europe trial have been removed, instead the Group is eligible to receive payments up to US$112.5 million prior to product launch in the EU, inclusive of US$17.5 million already received, if certain clinical and regulatory milestones are satisfied and reimbursement targets are achieved. Cumulative milestone payments could reach US$1 billion depending on the final outcome of Phase 3 studies and patient adoption. The Group will also receive tiered double-digit royalties on product sales as per the agreement.

The $2.5 million milestone payment received in December 2019 from Grünenthal was considered deferred consideration as of December 31, 2023. The performance obligation for the $2.5 million was previously satisfied under the original agreement, however under the amended agreement with Grünenthal it is subject to repayment to Grünenthal. Revenue will be recognized when the clinical trial has recruited the required amount of European patients, as the $2.5 million will no longer be subject to repayment to Grünenthal. For the six months ended December 31, 2023 and 2022, respectively, no milestone revenue was recognized in relation to this strategic partnership with Grünenthal.

Tasly arrangement

In July 2018, the Group entered into a strategic alliance with Tasly Pharmaceutical Group (“Tasly”) for the development, manufacture and commercialization in China of the Group’s allogeneic mesenchymal precursor cell (“MPC”) products, MPC-150-IM and MPC-25-IC. Tasly received all exclusive rights for MPC-150-IM and MPC-25-IC in China and Tasly will fund all development, manufacturing and commercialization activities in China.

The Group received a $20.0 million up-front technology access fee from Tasly upon closing of this strategic alliance in October 2018. The Group recognized $10.0 million from this $20.0 million up-front technology access fee at closing in

October 2018 and the remaining $10.0 million was recognized in revenue in February 2020. The Group is also entitled to receive $25.0 million on product regulatory approvals in China, double-digit escalating royalties on net product sales and up to six escalating milestone payments when the product candidates reach certain sales thresholds in China.

For the six months ended December 31, 2023 and 2022, respectively, no revenue was recognized in relation to this strategic alliance with Tasly.

TiGenix arrangement

In December 2017, the Group entered into a patent license agreement with TiGenix NV (“TiGenix”), now a wholly owned subsidiary of Takeda Pharmaceutical Company Limited (“Takeda”), which granted Takeda exclusive access to certain of our patents to support global commercialization of the adipose-derived mesenchymal stem cell (“MSC") product, Alofisel® a registered trademark of TiGenix, previously known as Cx601, for the local treatment of fistulae. The agreement includes the right for Takeda to grant sub-licenses to affiliates and third parties.

The Group received a $5.9 million (€5.0 million) up-front payment upon entering the patent license agreement and a further payment of $5.9 million (€5.0 million) 12 months after the patent license agreement date. In September 2021, the Group received a milestone payment of $1.2 million (€1.0 million) upon Takeda receiving approval to manufacture and market Alofisel® in Japan for the treatment of complex perianal fistulas in patients with non-active or mildly active luminal Crohn's Disease. The Group is entitled to further payments up to €9.0 million when Takeda reaches certain product regulatory milestones. Additionally, the Group receives single digit royalties on net sales of Alofisel®.

For the six months ended December 31, 2023 and 2022, the Group earned $0.2 million and $0.2 million, respectively, of royalty income on sales of Alofisel® in Europe by our licensee Takeda.

For the six months ended December 31, 2023 and 2022, respectively, no milestone revenue was recognized in relation to the Group's patent license agreement with Takeda.

JCR arrangement

In October 2013, the Group acquired all of the culture-expanded, MSC-based assets from Osiris Therapeutics, Inc. These assets included assumption of a collaboration agreement with JCR, a research and development oriented pharmaceutical company in Japan. Revenue recognized under this agreement is limited to the amount of cash received or for which the Group is entitled, as JCR has the right to terminate the agreement at any time.

Under the JCR Agreement, JCR is responsible for all development and manufacturing costs including sales and marketing expenses. Under the JCR Agreement, JCR has the right to develop our MSCs in two fields for the Japanese market: exclusive in conjunction with the treatment of hematological malignancies by the use of hematopoietic stem cells derived from peripheral blood, cord blood or bone marrow, or the First JCR Field; and non-exclusive for developing assays that use liver cells for non-clinical drug screening and evaluation, or the Second JCR Field. With respect to the First JCR Field, the Group are entitled to payments when JCR reaches certain commercial milestones and to escalating double-digit royalties. These royalties are subject to possible renegotiation downward in the event of competition from non-infringing products in Japan. With respect to the Second JCR Field, the Group are entitled to a double-digit profit share. The Group expanded our partnership with JCR in Japan for two new indications: for wound healing in patients with Epidermolysis Bullosa (“EB”) in October 2018 and for hypoxic ischemic encephalopathy (“HIE”), a condition suffered by newborns who lack sufficient blood supply and oxygen to the brain, in June 2020. The Group will receive royalties on TEMCELL® Hs. Inj. (“TEMCELL”), a registered trademark of JCR product sales for EB and HIE, if and when JCR begins selling TEMCELL for such indications in Japan. The Group apply the sales-based and usage-based royalty exception for licenses of intellectual property and therefore recognizes royalty revenue at the later of when the subsequent sale or usage occurs and the associated performance obligation has been satisfied.

In the six months ended December 31, 2023, the Group recognized $3.2 million in commercialization revenue relating to royalty income earned on sales of TEMCELL in Japan by our licensee JCR, compared with $3.2 million for the six months ended December 31, 2022. These amounts were recorded in revenue as there are no further performance obligations required in regard to these items.

Inventories

Inventories are included in the financial statements at the lower of cost (including raw materials, direct labor, other direct costs and related production overheads) and net realizable value. Pre-launch inventory is held as an asset when there is a high probability of regulatory approval for the product in accordance with IAS 2 Inventories. Before that point, a provision is made against the carrying value to its recoverable amount in accordance with IAS 2 Inventories; the provision is then reversed at the point when a high probability of regulatory approval is determined.

The Group considers a number of factors in determining the probability of the product candidate realizing future economic benefit, including the product candidate’s current status in the regulatory approval process, results from the related pivotal clinical trial, results from meetings with relevant regulatory agencies prior to the filing of regulatory applications, the market need, historical experience, as well as potential impediments to the approval process such as product safety or efficacy, commercialization and market trends.

When a provision is made against the carrying value of pre-launch inventory the costs are recognized within Manufacturing Commercialization expenses. When the high probability threshold is met, the provision will be reversed through Manufacturing Commercialization expenses.

All inventory costs are currently fully provided for and are recognized within Manufacturing Commercialization expenses. Where it is determined that the pre-launch inventory will be used within a clinical trial, that amount is removed from the cost of pre-launch inventory. There is no impact on the consolidated income statement as the carrying value has been previously fully provided for.

As of December 31, 2023, there was $21.6 million of pre-launch inventory recognized on the balance sheet that was fully provided for, compared with $22.4 million at June 30, 2023. The future commercial use of the pre-launch inventory recognized on the consolidated balance sheet will be dependent on future discussions with the FDA and remains fully provided for.

For the six months ended December 31, 2023, the Group reversed $0.8 million of pre-launch inventory costs within Manufacturing Commercialization expenses in relation to the provision against the carrying value of pre-launch inventory, primarily due to a reallocation of pre-launch inventory costs for use in clinical trials. For the six months ended December 31, 2022, $1.6 million of pre-launch inventory costs have been recognized within Manufacturing Commercialization expenses in relation to the provision against the carrying value of pre-launch inventory.

Equity - Summary of Movements in Ordinary Share Capital (Parenthetical) (Details) - Private Placement - $ / shares	Dec. 31, 2023	Dec. 31, 2022	Mar. 31, 2021
Disclosure Of Movements Of Shares In Share Trust [Line Items]
Number of shares issued and fully paid (in shares)	201,137,412	86,666,667
Exercise price (in australian dollars per share)	$ 0.30	$ 0.75	$ 2.30

Financial risk management

6 Months Ended

Dec. 31, 2023

Disclosure Of Financial Risk Management [Abstract]

Financial risk management

This note explains the Group’s exposure to financial risks and how these risks could affect the Group’s future financial performance. Current year profit and loss information has been included where relevant to add further context.

Risk

Exposure arising from

Measurement

Management

Market risk – currency risk

Future commercial transactions

Recognized financial assets and liabilities not denominated in the functional currency of each entity within the Group

Cash flow forecasting
Sensitivity analysis

The future cash flows of each currency are forecast and the quantum of cash reserves held for each currency are managed in line with future forecasted requirements. Cross currency swaps are undertaken as required.

Market risk – interest rate risk

Term deposits at fixed rates

Cash deposits at variable rates

Sensitivity analysis

Vary length of term deposits, utilize interest bearing accounts and periodically review interest rates available to ensure we earn interest at market rates.

Market risk – price risk

Long-term borrowings

Sensitivity analysis

Forecasts of net sales of the product underlying the NovaQuest borrowing arrangement are updated on a quarterly basis to evaluate the impact on the carrying amount of the financial liability.

Market risk – share price risk

Warrant liability

Sensitivity analysis

The future exercise of warrants will not impact the Group's future cash flows significantly given the warrants will be paid in shares upon exercise. Therefore there are no significant cashflow risks associated with these warrants. The Group monitors the impact on profit or loss that share price movements have on the valuation of the warrant liability each period.

Credit risk

Cash and cash equivalents, and trade and other receivables and other non-current assets

Aging analysis
Credit ratings

Transact primarily with the best risk rated banks available in each region giving consideration to the products required, the quantum of cash reserves held and future forecasted requirements.

Liquidity risk

Cash and cash equivalents, borrowings, trade payables, lease liabilities and contingent consideration

Rolling cash flow forecasts

Future cash flow requirements are forecasted and capital raising strategies are planned to ensure sufficient cash balances are maintained to meet the Group’s future commitments.

a. Market risk

(i) Currency risk

The Group has foreign currency amounts owing relating to clinical, regulatory and overhead activities and foreign currency deposits held primarily in the Group’s Australian based entity, whose functional currency is the A$. The Group also has foreign currency amounts owing in the Group’s Swiss and Singapore based entities, whose functional currencies are the US$. The Group also has foreign currency amounts owing in various other non-US$ currencies in A$ and US$ functional currency entities in the Group relating to clinical, regulatory and overhead activities. These foreign currency balances give rise to a currency risk, which is the risk of the exchange rate moving, in either direction, and the impact it may have on the Group’s financial performance.

Currency risk is minimized by ensuring the proportion of cash reserves held in each currency matches the expected rate of spend of each currency.

As of December 31, 2023, the Group held 68% of its cash in US$, 31% in A$ and 1% in other currencies. As of June 30, 2023, the Group held 67% of its cash in US$, and 33% in A$.

(ii) Cash flow and fair value interest rate risk

The Group is exposed to interest rate movements which impacts interest income earned on its deposits and at call accounts. The interest rate risk is managed by spreading the maturity date of our deposits across various periods. The Group ensures that sufficient funds are available, in at call accounts, to meet the working capital requirements of the Group.

The deposits held which derive interest revenue are described in the table below, together with the maximum and minimum interest rates being earned as of December 31, 2023 and June 30, 2023. The effect on profit is shown if interest rates change by 10%, in either direction, is as follows:


	As of December 31, 2023					As of June 30, 2023
(in U.S. dollars, in thousands, except percent data)	Low		High		US$	Low		High		US$
Funds invested - US$	1.84	%	1.84	%	49,950	1.79	%	1.79	%	40,569
Rate increase by 10%	2.02	%	2.02	%	92	1.97	%	1.97	%	73
Rate decrease by 10%	1.66	%	1.66	%	(92)	1.61	%	1.61	%	(73)

	As of December 31, 2023					As of June 30, 2023(1)
(in Australian dollars, in thousands, except percent data)	Low		High		A$	Low		High		A$
Funds invested - A$	3.85	%	4.88	%	35,466	3.60	%	4.59	%	35,707
Rate increase by 10%	4.24	%	5.37	%	151	3.96	%	5.05	%	143
Rate decrease by 10%	3.47	%	4.39	%	(151)	3.24	%	4.13	%	(143)

(1) A$ deposits held as of June 30, 2023 have been updated to reflect the increasing impact of higher interest rates.

(iii) Price risk

Price risk is the risk that future cash flows derived from financial instruments will be altered as a result of a market price movement, which is defined as movements other than foreign currency rates and interest rates. The Group is exposed to price risk which arises from long-term borrowings under its facility with NovaQuest, where the timing and amounts of principal and interest payments is dependent on net sales of remestemcel-L for the treatment of SR-aGVHD in pediatric patients in the United States and other territories excluding Asia. As net sales of remestemcel-L for the treatment of SR-aGVHD in pediatric patients in these territories increase/decrease, the timing and amount of principal and interest payments relating to this type of financing arrangement will also fluctuate, resulting in an adjustment to the carrying amount of the financial liability. The adjustment is recognized in the Consolidated Income Statement as remeasurement of borrowing arrangements within finance costs in the period the revision is made.

The exposure of the Group’s borrowing to price rate changes are as follows:


	As of December 31, 2023			As of June 30, 2023
(in U.S. dollars, in thousands, except percent data)	Total	% of total borrowings		Total	% of total borrowings
Financial liabilities
Current borrowings
Borrowings - NovaQuest	367	0	%	336	0	%
Non-current borrowings
Borrowings - NovaQuest	60,878	53	%	55,739	51	%
	61,245	53	%	56,075	51	%

As at December 31, 2023, all other factors held constant, a +/- 20% increase/decrease in the forecast net sales of remestemcel-L for the treatment of SR-aGVHD in pediatric patients in the United States and other territories excluding Asia would not have a significant impact on non-current borrowing and profit.

The Group is also exposed to price risk on contingent consideration provision balances, as expected unit revenues are a significant unobservable input used in the level 3 fair value measurements. As at December 31, 2023, all other factors held constant, the increase/decrease in price assumptions adopted in the fair value measurements of the contingent consideration provision are discussed in Note 5(e)(iv).

The Group does not consider it has any exposure to price risk other than those already described above.

(iv) Share price risk

The Group's exposure to share price risk arises from warrant liabilities held by the Group and classified in the statement of financial position at fair value through profit or loss. The future exercise of these warrants will not impact the Group's future cash flows significantly given the warrants will be paid in shares upon exercise, therefore there are no significant cashflow risks associated with these warrants. The Group monitors the impact on profit or loss that share price movements have on the valuation of the warrant liability each period.

The table below summarizes the impact of the increase/decrease of Mesoblast's share price on the Group's profit or loss during the period, based on the assumption that the share price had increased/decreased by 10% and 10% with all other variables held constant as of December 31, 2023 and June 30, 2023 respectively.


(in U.S. dollars, in thousands)	As of December 31, 2023		As of June 30, 2023
Financial liabilities
Warrant liability		992	5,426
Impact on profit or (loss)
Share price increase by 10% (2023: 10%)		(144)	(698)
Share price decrease by 10% (2023: 10%)		140	686

b. Credit risk

Credit risk is the risk that one party to a financial instrument will fail to discharge its obligation and cause financial loss to the other party. The maximum exposure to credit risk at the end of the reporting period is the carrying amount of each class of financial assets as mentioned in Note 5.

c. Liquidity risk

Liquidity risk is the risk that the Group will not be able to pay its debts as and when they fall due. Liquidity risk has been assessed in Note 1(i).

All financial liabilities, excluding contingent consideration, borrowings and lease liabilities held by the Group as of December 31, 2023 and June 30, 2023 mature within 6 months. Trade payables and contingent consideration held by the Group as of December 31, 2023 and June 30, 2023 are non-interest bearing. The total contractual cash flows associated with trade payables equate to the carrying amount disclosed within the financial statements.

As of December 31, 2023, the maturity profile of the anticipated future contractual cash flows on an undiscounted basis and removing probability adjustments as applicable for contingent consideration, and which therefore differs from the carrying value, is as follows:


(in U.S. dollars, in thousands)	Within 1 year	Between 1-2 years	Between 2-5 years	Over 5 years	Total contractual cash flows	Carrying amount
Borrowings(1)(2)	(9,739)	(18,242)	(143,701)	—	(171,682)	(115,763)
Trade payables	(10,760)	—	—	—	(10,760)	(10,760)
Lease liabilities	(3,131)	(2,877)	(613)	—	(6,621)	(6,237)
Contingent consideration(3)	(5,000)	(881)	(141)	—	(6,022)	(612)
	(28,630)	(22,000)	(144,455)	—	(195,085)	(133,372)

(1)Contractual cash flows include payments of principal, interest and other charges. Interest is calculated based on debt held at December 31, 2023 without taking into account drawdowns of further tranches.

(2)In relation to the contractual maturities of the NovaQuest borrowings, there is variability in the maturity profile of the anticipated future contractual cash flows given the timing and amount of payments are calculated based on our estimated net sales of remestemcel-L for the treatment of pediatric SR-aGVHD in the United States and other territories excluding Asia.

(3)In relation to the contractual maturities of the royalty payments related to contingent consideration, there is variability in the maturity profile of the anticipated future contractual cash flows given the timing and amount of payments are calculated based on our estimated net sales of remestemcel-L for the treatment of children and adults with aGVHD. Product royalties will be payable in cash which will be funded from royalties received from net sales. With respect to future milestone payments, contingent consideration will be payable in cash or shares at our discretion. The carrying amount reflects the discounted and probability adjusted contractual balance related to royalty payments.

Purchase commitments

In December 2019, the Group commenced production under its manufacturing service agreement with Lonza for the supply of commercial product for the potential approval and launch of remestemcel-L for the treatment of pediatric SR-aGVHD in the US market. This agreement contains lease and non-lease components. As of December 31, 2023, the agreement contains a minimum remaining financial commitment of the non-lease component of $12.7 million, payable until June 2025, which is cancellable in limited circumstances. The Group has accounted for the lease component within the agreement as a lease liability separately from the non-lease components. As of December 31, 2023, the lease component is $2.5 million on an undiscounted basis, as disclosed within the total contractual cash flows as lease liabilities in Note 9(c). At the Group's discretion, the minimum financial commitment under this manufacturing services agreement can be reduced by $7.4 million under certain conditions, with $1.5 million of this reduction relating to the lease component and $5.9 million relating to the non-lease component of the agreement.

The Group have agreements with third parties related to contract manufacturing and other goods and services. As of December 31, 2023, the Group had $5.7 million of non-cancellable purchase commitments related to raw materials, manufacturing agreements and other goods and services (excluding those with Lonza). This amount represents our minimum contractual obligations, including termination fees. Certain agreements provide for termination rights subject to termination fees. Under such agreements, the Group are contractually obligated to make certain payments, mainly, to reimburse them for their unrecoverable outlays incurred prior to cancellation.

The Group did not have any other purchase commitments as of December 31, 2023.

Basis of preparation (Details) - USD ($) $ in Thousands	6 Months Ended
Basis of preparation (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Jun. 30, 2023	Dec. 31, 2022	Jun. 30, 2022
Basis Of Preparation [Abstract]
Cash & cash equivalents	$ 77,554	$ 71,318	$ 67,619	$ 60,447
Maximum amount paid in cash outflows from operating activities	$ 26,600
Percentage of reduction in cash outflows from operating activities	14.00%

Legal Proceedings (Details)	Dec. 31, 2023 lawsuit
Legal proceedings provision [abstract]
Number of action lawsuits	1

Income tax benefit/(expense) - Summary of Deferred Tax Assets Not Brought to Account (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Jun. 30, 2023
Unused tax losses
Potential tax benefit at local tax rates	$ 134,682	$ 125,728
Other temporary differences
Potential tax benefit at local tax rates	13,797	12,318
Other tax credits
Potential tax benefit at local tax rates	3,220	3,220
Deferred tax assets not brought to account	$ 151,699	$ 141,266

Segment information	6 Months Ended
Segment information	Dec. 31, 2023
Disclosure of operating segments [abstract]
Segment information	Segment information Operating segments are identified on the basis of whether the allocation of resources and/or the assessment of performance of a particular component of the Company’s activities are regularly reviewed by the Company’s chief operating decision maker as a separate operating segment. By these criteria, the activities of the Company are considered to be one segment being the development of adult stem cell technology platform for commercialization, and the segmental analysis is the same as the analysis for the Company as a whole. The chief operating decision maker (Chief Executive Officer) reviews the consolidated income statement, balance sheet, and statement of cash flows regularly to make decisions about the Company’s resources and to assess overall performance.

Financial risk management (Tables)

6 Months Ended

Dec. 31, 2023

Disclosure Of Financial Risk Management [Abstract]

Schedule of Exposure to Financial Risks

Risk

Exposure arising from

Measurement

Management

Market risk – currency risk

Future commercial transactions

Recognized financial assets and liabilities not denominated in the functional currency of each entity within the Group

Cash flow forecasting
Sensitivity analysis

Market risk – interest rate risk

Term deposits at fixed rates

Cash deposits at variable rates

Sensitivity analysis

Vary length of term deposits, utilize interest bearing accounts and periodically review interest rates available to ensure we earn interest at market rates.

Market risk – price risk

Long-term borrowings

Sensitivity analysis

Forecasts of net sales of the product underlying the NovaQuest borrowing arrangement are updated on a quarterly basis to evaluate the impact on the carrying amount of the financial liability.

Market risk – share price risk

Warrant liability

Sensitivity analysis

Credit risk

Cash and cash equivalents, and trade and other receivables and other non-current assets

Aging analysis
Credit ratings

Transact primarily with the best risk rated banks available in each region giving consideration to the products required, the quantum of cash reserves held and future forecasted requirements.

Liquidity risk

Cash and cash equivalents, borrowings, trade payables, lease liabilities and contingent consideration

Rolling cash flow forecasts

Future cash flow requirements are forecasted and capital raising strategies are planned to ensure sufficient cash balances are maintained to meet the Group’s future commitments.

Schedule of Deposits Held which Derive Interest Revenue with Maximum and Minimum Interest Rates Being Earned


	As of December 31, 2023					As of June 30, 2023
(in U.S. dollars, in thousands, except percent data)	Low		High		US$	Low		High		US$
Funds invested - US$	1.84	%	1.84	%	49,950	1.79	%	1.79	%	40,569
Rate increase by 10%	2.02	%	2.02	%	92	1.97	%	1.97	%	73
Rate decrease by 10%	1.66	%	1.66	%	(92)	1.61	%	1.61	%	(73)

	As of December 31, 2023					As of June 30, 2023(1)
(in Australian dollars, in thousands, except percent data)	Low		High		A$	Low		High		A$
Funds invested - A$	3.85	%	4.88	%	35,466	3.60	%	4.59	%	35,707
Rate increase by 10%	4.24	%	5.37	%	151	3.96	%	5.05	%	143
Rate decrease by 10%	3.47	%	4.39	%	(151)	3.24	%	4.13	%	(143)

(1) A$ deposits held as of June 30, 2023 have been updated to reflect the increasing impact of higher interest rates.

Summary of Borrowing to Price Rate Changes

The exposure of the Group’s borrowing to price rate changes are as follows:


	As of December 31, 2023			As of June 30, 2023
(in U.S. dollars, in thousands, except percent data)	Total	% of total borrowings		Total	% of total borrowings
Financial liabilities
Current borrowings
Borrowings - NovaQuest	367	0	%	336	0	%
Non-current borrowings
Borrowings - NovaQuest	60,878	53	%	55,739	51	%
	61,245	53	%	56,075	51	%

Schedule of Increase/Decrease of Share Price


(in U.S. dollars, in thousands)	As of December 31, 2023		As of June 30, 2023
Financial liabilities
Warrant liability		992	5,426
Impact on profit or (loss)
Share price increase by 10% (2023: 10%)		(144)	(698)
Share price decrease by 10% (2023: 10%)		140	686

Schedule of Maturity Profile of Anticipated Future Contractual Cash Flows Carrying Value


(in U.S. dollars, in thousands)	Within 1 year	Between 1-2 years	Between 2-5 years	Over 5 years	Total contractual cash flows	Carrying amount
Borrowings(1)(2)	(9,739)	(18,242)	(143,701)	—	(171,682)	(115,763)
Trade payables	(10,760)	—	—	—	(10,760)	(10,760)
Lease liabilities	(3,131)	(2,877)	(613)	—	(6,621)	(6,237)
Contingent consideration(3)	(5,000)	(881)	(141)	—	(6,022)	(612)
	(28,630)	(22,000)	(144,455)	—	(195,085)	(133,372)

Equity - Additional Information (Details) $ / shares in Units, $ in Thousands, $ in Millions	1 Months Ended		6 Months Ended
	Mar. 31, 2021 USD ($) $ / shares	Mar. 31, 2021 AUD ($) $ / shares shares	Dec. 31, 2023 USD ($)	Dec. 31, 2022 USD ($)	Jan. 05, 2024 $ / shares	Dec. 31, 2023 $ / shares	Dec. 31, 2022 $ / shares	Dec. 31, 2021
Disclosure Of Classes Of Share Capital [Line Items]
Proceeds from issue of shares \| $			$ 39,708	$ 45,065
Warrants
Disclosure Of Classes Of Share Capital [Line Items]
Ordinary shares (in shares) \| shares		15,027,327
Warrant exercise price per share (in australian dollar per shares)		$ 2.88				$ 2.88
Warrant exercise term	7 years	7 years
Share price, minimum consecutive day		45 days
Warrants \| Major ordinary share transactions [member]
Disclosure Of Classes Of Share Capital [Line Items]
Warrant exercise price per share (in australian dollar per shares)					$ 2.86
Warrants \| Bottom of Range
Disclosure Of Classes Of Share Capital [Line Items]
Share price for right exercise of the warrants (in australian dollar per shares)	4.32	4.32
Private Placement
Disclosure Of Classes Of Share Capital [Line Items]
Proceeds from issue of shares	$ 110,000	$ 138.0
Fully-paid ordinary shares (in shares) \| shares		60,109,290
Exercise price (in australian dollars per share)		$ 2.30				$ 0.30	$ 0.75
Conversion ratio of warrants						0.25		0.25

Financial assets and liabilities (Tables)

6 Months Ended

Dec. 31, 2023

Disclosure Of Financial Assets And Liabilities [Abstract]

Summary of Financial Instruments

The Group holds the following financial instruments:


Financial assets (in U.S. dollars, in thousands)	Notes	Assets at FVOCI(1)	Assets at FVTPL(2)	Assets at amortized cost	Total
As of December 31, 2023
Cash & cash equivalents	5(a)	—	—	77,554	77,554
Trade & other receivables	5(b)	—	—	3,998	3,998
Financial assets at fair value through other comprehensive income		826	—	—	826
Other non-current assets		—	—	2,241	2,241
		826	—	83,793	84,619
As of June 30, 2023
Cash & cash equivalents	5(a)	—	—	71,318	71,318
Trade & other receivables	5(b)	—	—	6,998	6,998
Financial assets at fair value through other comprehensive income		1,757	—	—	1,757
Other non-current assets		—	—	2,326	2,326
		1,757	—	80,642	82,399

(1)Fair value through other comprehensive income

(2)Fair value through profit or loss


Financial liabilities (in U.S. dollars, in thousands)	Notes	Liabilities at FVOCI(1)	Liabilities at FVTPL(2)	Liabilities at amortized cost	Total
As of December 31, 2023
Trade and other payables	5(c)	—	—	10,760	10,760
Borrowings	5(d)	—	—	115,762	115,762
Contingent consideration	5(e)(iii)	—	17,536	—	17,536
Warrant liability	5(e)(vi)	—	992	—	992
		—	18,528	126,522	145,050
As of June 30, 2023
Trade and other payables	5(c)	—	—	20,145	20,145
Borrowings	5(d)	—	—	108,763	108,763
Contingent consideration	5(e)(iii)	—	17,199	—	17,199
Warrant liability	5(e)(vi)	—	5,426	—	5,426
		—	22,625	128,908	151,533

(1)Fair value through other comprehensive income

(2)Fair value through profit or loss

Summary of Cash and Cash Equivalents

a. Cash and cash equivalents


(in U.S. dollars, in thousands)	As of December 31, 2023	As of June 30, 2023
Cash at bank	77,144	70,920
Deposits at call(1)	410	398
	77,554	71,318


(1)As of December 31, 2023 and June 30, 2023, interest-bearing deposits at call include amounts of $0.4 million and $0.4 million, respectively, held as security and restricted for use.

Summary of Trade and Other Receivables and Prepayments

b. Trade and other receivables and prepayments

(i) Trade and other receivables


(in U.S. dollars, in thousands)	As of December 31, 2023	As of June 30, 2023
Trade debtors	1,804	2,276
Tax incentives recoverable (1)	1,271	2,363
Foreign withholding tax recoverable	471	471
U.S. Tax credits	—	1,473
Net investment in sublease	216	195
Interest receivables	11	18
Other recoverable taxes (Goods and services tax and value-added tax)	225	202
Trade and other receivables	3,998	6,998

(1) Research and development tax incentive

The Group's research and development activities are eligible under the Australian government's Innovation

Australia Research and Development Tax Incentive program for research and development activities conducted in relation

to qualifying research that meets the regulatory criteria. Management has assessed these activities and expenditures to

determine which costs are likely to be eligible under the incentive scheme. The Group assesses, on an annual basis, the

(ii) Prepayments


(in U.S. dollars, in thousands)	As of December 31, 2023	As of June 30, 2023
Clinical trial research and development expenditure	23	950
Prepaid insurance and subscriptions	3,219	2,025
Other	360	367
Prepayments	3,602	3,342

Summary of Trade and Other Payables

c. Trade and other payables


(in U.S. dollars, in thousands)	As of December 31, 2023	As of June 30, 2023
Trade payables and other payables	10,760	20,145
Trade and other payables	10,760	20,145

Summary of Borrowings

d. Borrowings


(in U.S. dollars, in thousands)	As of December 31, 2023	As of June 30, 2023
Borrowings
Secured liabilities:
Borrowing arrangements	81,919	81,919
Less: transaction costs	(9,215)	(8,740)
Amortization of carrying amount, net of payments made	43,058	35,584
	115,762	108,763

(in U.S. dollars, in thousands)	As of December 31, 2023	As of June 30, 2023
Borrowings
Current
Borrowings - NovaQuest	367	336
Borrowings - Oaktree	8,167	5,616
	8,534	5,952
Non-current
Borrowings - NovaQuest	60,878	55,739
Borrowings - Oaktree	46,350	47,072
	107,228	102,811
	115,762	108,763

Summary of Net Debt

(iii) Net Debt Reconciliation


(in U.S. dollars, in thousands)	As of December 31, 2023	As of June 30, 2023
Cash and cash equivalents	77,554	71,318
Borrowings	(115,762)	(108,763)
Lease liabilities	(6,237)	(7,732)
Warrant liability	(992)	(5,426)
Net Debt(1)	(45,437)	(50,603)

Cash and cash equivalents	77,554	71,318
Gross debt - fixed interest rates	(121,999)	(116,495)
Gross debt - variable interest rates	—	—
Warrant liability	(992)	(5,426)
Net Debt(1)	(45,437)	(50,603)

(1)Net debt amount includes leases and borrowing arrangements.

Summary of Net Debt Reconciliation


	Liabilities from financing activities				Other assets
(in U.S. dollars, in thousands)	Borrowings	Leases	Warrant liability	Sub-total	Cash and cash equivalents	Total
Net Debt as at June 30, 2023	(108,763)	(7,732)	(5,426)	(121,921)	71,318	(50,603)
Cash Flows(1)	3,163	2,337	—	5,500	4,940	10,440
Remeasurement adjustments	(120)	—	4,434	4,314	—	4,314
Other Changes(2)	(10,042)	(782)	—	(10,824)	—	(10,824)
Foreign exchange adjustments	—	(60)	—	(60)	1,296	1,236
Net Debt as at December 31, 2023	(115,762)	(6,237)	(992)	(122,991)	77,554	(45,437)

(1)Cash flows include the payments of borrowings, lease liabilities, interest and debt transaction costs which are presented as financing cash flows in the statement of cash flows.

(2)Other changes include modification of leases and accrued interest expenses for borrowings and leases.

Summary of Financial Assets and Liabilities Measured and Recognized at Fair Value


As of December 31, 2023
(in U.S. dollars, in thousands)	Notes	Level 1	Level 2	Level 3	Total
Financial Assets
Financial assets at fair value through other comprehensive income:
Equity securities - biotech sector		—	—	826	826
Total Financial Assets		—	—	826	826

Financial Liabilities
Financial liabilities at fair value through profit or loss:
Contingent consideration	5(e)(iii)	—	—	17,536	17,536
Warrant liabilities	5(e)(vi)	—	—	992	992
Total Financial Liabilities		—	—	18,528	18,528


As of June 30, 2023
(in U.S. dollars, in thousands)	Notes	Level 1	Level 2	Level 3	Total

Financial Assets
Financial assets at fair value through other comprehensive income:
Equity securities - biotech sector		—	—	1,757	1,757
Total Financial Assets		—	—	1,757	1,757

Financial Liabilities
Financial liabilities at fair value through profit or loss:
Contingent consideration	5(e)(iii)	—	—	17,199	17,199
Warrant liabilities	5(e)(vi)	—	—	5,426	5,426
Total Financial Liabilities		—	—	22,625	22,625

Summary of Changes in Fair Value of Level 3 Instruments

The following table presents the changes in level 3 instruments for the six months ended December 31, 2023 and the year ended June 30, 2023.


(in U.S. dollars, in thousands)			Contingent consideration provision
Opening balance - July 1, 2022			23,284
Reclassification during the period			2,686
Charged/(credited) to consolidated income statement:
Remeasurement(1)			(8,771)
Closing balance - June 30, 2023			17,199

Opening balance - July 1, 2023			17,199
Charged/(credited) to consolidated income statement:
Remeasurement(2)			337
Closing balance - December 31, 2023			17,536


(1)In the year ended June 30, 2023 a gain of $8.8 million was recognized on the remeasurement of contingent consideration pertaining to the acquisition of the MSC assets. This remeasurement was a net result of changing the key assumptions of the contingent consideration valuation such as probability of payment, developmental timelines and the increase in valuation as the time period shortens between the valuation date and the potential settlement dates of contingent consideration, including the impact from the complete response from the FDA on the Group's BLA for remestemcel-L for the treatment of pediatric SR-aGVHD in August 2023. The assumptions relating to development timelines were updated to reflect expectations as a result of the complete response.


(2)In the six months ended December 31, 2023 a minimal gain was recognized on the remeasurement of contingent consideration pertaining to the acquisition of the MSC assets. This remeasurement was a net result of changing key assumptions of the contingent consideration valuation such as development timelines and the increase in valuation as the time period shortens between the valuation date and the potential settlement dates of contingent consideration.

Summary of Quantitative Information About the Significant Unobservable Inputs Used in Level 3 Fair Value Measurements

The following table summarizes the quantitative information about the significant unobservable inputs used in level 3 fair value measurements:

(in U.S. dollars, in thousands, except percent data)

Range of inputs
(weighted average)

Description

Fair value
as of
December 31,
2023

Fair value
as of
June 30,
2023

Valuation
technique

Unobservable

inputs(1)

Six Months Ended
December 31,
2023

Year Ended
June 30,
2023

Relationship of
unobservable inputs to
fair value

Contingent consideration provision

17,536

17,199

Discounted cash flows

Risk adjusted discount rate

11%-13%

(12.5%)

11%-13%

(12.5%)

Six months ended December 31, 2023: A change in the discount rate by 0.5% would increase/decrease the fair value by an insignificant amount.

Year ended 30 June, 2023: A change in the discount rate by 0.5% would increase/decrease the fair value by 0.01%.

Expected unit sales price

Various

Six months ended December 31, 2023: A change in the price assumptions by 10% would increase/decrease the fair value by 0.1%.

Year ended 30 June, 2023: A change in the price assumptions by 10% would increase/decrease the fair value by 0.1%.

Expected sales volumes

Various

Six months ended December 31, 2023: A change in the volume assumptions by 10% would increase/decrease the fair value by 0.1%.

Year ended 30 June, 2023: A change in the volume assumptions by 10% would increase/decrease the fair value by 0.1%.

Probability of success and payment

Various

Six months ended December 31, 2023: A change in the probability of success and payment assumptions by 10% and 20% would increase/decrease the fair value by 10.0% and 20.0%, respectively.

Year ended 30 June, 2023: A change in the probability of success and payment assumptions by 10% and 20% would increase/decrease the fair value by 8% and 16%, respectively.

(1)There were no significant inter-relationships between unobservable inputs that materially affect fair values.

Disclosure of Detailed Information About Valuation Processes of Contingent Consideration at Fair Value Explanatory


	As of December 31,	As of June 30,
The fair value of contingent consideration (in U.S. dollars, in thousands)	2023	2023
Fair value of cash or stock payable, dependent on achievement of future late-stage clinical or regulatory targets	16,924	16,606
Fair value of royalty payments from commercialization of the intellectual property acquired	612	593
	17,536	17,199

Summary of Warrant Liability


(in U.S. dollars, in thousands)	As of December 31,	As of June 30,
Warrant liability	2023	2023
Opening balance	5,426	2,185
Warrants fair value at grant date - December 22, 2022	—	1,036
Remeasurement of warrant liability	(4,434)	2,205
Closing Balance	992	5,426

Summary of Fair Value of Warrants

The following assumptions were based on observable market conditions that existed at the issue date and as of December 31, 2023.

(in U.S. dollars, except percent data and as otherwise noted)
Assumption

As of
December 31,
2023

As of June 30, 2023

Rationale

Share Price

$1.10

$3.91

Closing share price on valuation date from external market source

Exercise Price

$3.70 to $7.26

As per subscription agreement

Expected Term

5 to 7 years

6 to 7 years

As per subscription agreement

Dividend Yield

Based on Company’s nil dividend history

Expected Volatility

86.71%

81.26%

Based on historical volatility data for the Company

Risk Free Interest Rate

3.88%

4.01%

Based on the closing U.S treasury issued 7 year bonds on valuation date

Fair value per warrant

$0.4000 to $0.6248

$2.3103 to $2.9401

Determined using Black-Scholes valuation model with the inputs above

Fair value

$992,233

$5,426,212

Fair value of 2,224,669 warrants of $992,233 and $5,426,212 as of December 31, 2023 and June 30, 2023, respectively.

Segment Information (Details)	6 Months Ended
Segment Information (Details)	Dec. 31, 2023 segment
Disclosure of operating segments [abstract]
Number of operating segment	1

(Losses) per share

6 Months Ended

Dec. 31, 2023

Earnings per share [abstract]

(Losses) per share

Six Months Ended

December 31,
2023

December 31,
2022

Cents

(Losses) per share

(in cents)

(a) Basic (losses) per share

From continuing operations attributable to the ordinary equity holders of the company

(3.82)

(5.64)

Total basic (losses) per share attributable to the ordinary equity holders of the company

(3.82)

(5.64)

(b) Diluted (losses) per share

From continuing operations attributable to the ordinary equity holders of the company

(3.82)

(5.64)

Total diluted (losses) per share attributable to the ordinary equity holders of the company

(3.82)

(5.64)

(in U.S. dollars, in thousands)

Basic (losses) per share

(Losses) attributable to the ordinary equity holders of the company used in calculating basic (losses) per share:

From continuing operations

(32,539)

(41,370)

Diluted (losses) per share

(Losses) from continuing operations attributable to the ordinary equity holders of the company:

Used in calculating basic (losses) per share

(32,539)

(41,370)

(Losses) attributable to the ordinary equity holders of the company used in calculating diluted losses per share

(32,539)

(41,370)

Six Months Ended

December 31,
2023

December 31,
2022

(In Shares)

Weighted average number of ordinary shares used as the denominator in calculating basic losses per share

851,464,145

733,282,900

Weighted average number of ordinary shares and potential ordinary shares used in calculating diluted losses per share

851,464,145

733,282,900

Options granted to employees and warrants are considered to be potential ordinary shares. These securities have been excluded from the determination of basic losses per share in the six months ended December 31, 2023 and 2022. Shares that may be paid as contingent consideration have also been excluded from basic losses per share. They have been excluded from the calculation of diluted losses per share because they are anti-dilutive for the six months ended December 31, 2023 and 2022.

The calculations for the six months ended December 31, 2023 and 2022 have been adjusted to reflect the bonus element in the entitlement offer to existing eligible shareholders which occurred during December 2023.

Financial assets and liabilities - Additional Information (Details) - USD ($)						1 Months Ended	6 Months Ended		12 Months Ended
	Jan. 05, 2024	Mar. 08, 2023	Dec. 22, 2022	Nov. 19, 2021	Jun. 29, 2018	Nov. 30, 2021	Dec. 31, 2023	Dec. 31, 2022	Jun. 30, 2023
Disclosure Of Financial Assets And Liabilities [Line Items]
Borrowings							$ 115,762,000		$ 108,763,000
Issuance warrants exercised period							7 years
Financial assets							$ 84,619,000		82,399,000
Financial liabilities							145,050,000		151,533,000
Warrants fair value at issue date							1,000,000		$ 5,400,000
Gain (loss) on remeasurement of warrant liability							$ (4,400,000)	$ (700,000)
Level 3 \| Unlisted Equity Securities
Disclosure Of Financial Assets And Liabilities [Line Items]
Percentage of assets measured at fair value							100.00%		100.00%
Gross debt - fixed interest rates
Disclosure Of Financial Assets And Liabilities [Line Items]
Borrowings							$ 121,999,000		$ 116,495,000
American Depositary Shares \| Potential Ordinary Share Transactions
Disclosure Of Financial Assets And Liabilities [Line Items]
Outstanding common share capital, percentage	1000.00%
American Depository Receipt \| Potential Ordinary Share Transactions
Disclosure Of Financial Assets And Liabilities [Line Items]
Outstanding common share capital, percentage	500.00%
Borrowings - Oaktree
Disclosure Of Financial Assets And Liabilities [Line Items]
Borrowings principal amount						$ 90,000,000
Borrowings term						5 years
Borrowings				$ 60,000,000
Borrowings, Interest Only Period						3 years
Borrowings, interest rate						9.75%
Percentage of principal amount payable over two year						40.00%
Amortization period						2 years
Unpaid Interest Portion Per Annum						1.75%
Percentage of premium for volume-weighted average price			15.00%	15.00%
Issuance warrants exercised period		7 years		7 years
Remeasurement of borrowing arrangements within finance gains (loss)								(1,400,000)
Finance costs loss on remeasurement due to additional warrants issued								1,000,000
Finance costs loss on adjustment of carrying amount on financial liability								$ 400,000
Borrowings - Oaktree \| Refinancing and Expansion of Senior Debt Facility
Disclosure Of Financial Assets And Liabilities [Line Items]
Percentage of share premium price								15.00%
Warrant exercise term		7 years
Borrowings - Oaktree \| American Depositary Shares
Disclosure Of Financial Assets And Liabilities [Line Items]
Exercise price (in australian dollars per share)			$ 3.70	$ 7.26		$ 7.26		$ 3.70
Borrowings - Oaktree \| American Depositary Shares \| Potential Ordinary Share Transactions
Disclosure Of Financial Assets And Liabilities [Line Items]
Exercise price (in australian dollars per share)	$ 14.36
Borrowings - Oaktree \| American Depositary Shares \| Refinancing and Expansion of Senior Debt Facility
Disclosure Of Financial Assets And Liabilities [Line Items]
Exercise price (in australian dollars per share)								$ 3.70
Borrowings - Oaktree \| Warrants
Disclosure Of Financial Assets And Liabilities [Line Items]
Number of warrants granted to purchase american depositary shares (in shares)			455,000	1,769,669
Borrowings - Oaktree \| Warrants \| Refinancing and Expansion of Senior Debt Facility
Disclosure Of Financial Assets And Liabilities [Line Items]
Number of warrants granted to purchase american depositary shares (in shares)								455,000
Borrowings - Oaktree \| November 2021 warrants
Disclosure Of Financial Assets And Liabilities [Line Items]
Number of warrants issued to purchase american depositary shares						1,769,669
Borrowings - Oaktree \| November 2021 warrants \| Potential Ordinary Share Transactions
Disclosure Of Financial Assets And Liabilities [Line Items]
Number of warrants issued to purchase american depositary shares	884,838					884,838
Borrowings - Oaktree \| December 2022 warrants
Disclosure Of Financial Assets And Liabilities [Line Items]
Number of warrants issued to purchase american depositary shares								455,000
Borrowings - Oaktree \| December 2022 warrants \| Potential Ordinary Share Transactions
Disclosure Of Financial Assets And Liabilities [Line Items]
Number of warrants issued to purchase american depositary shares	227,502
Borrowings - Oaktree \| December 2022 warrants \| American Depositary Shares \| Potential Ordinary Share Transactions
Disclosure Of Financial Assets And Liabilities [Line Items]
Exercise price (in australian dollars per share)	$ 7.24
Borrowings - Oaktree \| Tranche One
Disclosure Of Financial Assets And Liabilities [Line Items]
Borrowings				$ 60,000,000		$ 60,000,000	30,000,000
Borrowings, interest rate						9.75%
Borrowings - Oaktree \| Quarterly Payments
Disclosure Of Financial Assets And Liabilities [Line Items]
Borrowings, interest rate						8.00%
Borrowings - NovaQuest
Disclosure Of Financial Assets And Liabilities [Line Items]
Remeasurement of borrowing arrangements within finance gains (loss)							(100,000)	$ 200,000
Percentage of entity's revenue, annual payment cap threshold					25.00%
Borrowings - NovaQuest \| Level 2
Disclosure Of Financial Assets And Liabilities [Line Items]
Financial assets							0		0
Financial liabilities							0		0
Borrowings - NovaQuest \| Level 1
Disclosure Of Financial Assets And Liabilities [Line Items]
Financial assets							0		0
Financial liabilities							$ 0		$ 0
Borrowings - NovaQuest \| Gross debt - fixed interest rates
Disclosure Of Financial Assets And Liabilities [Line Items]
Borrowings principal amount					$ 40,000,000
Borrowings term					8 years
Borrowings, Interest Only Period					4 years
Borrowings, interest rate					15.00%
Borrowings - NovaQuest \| Contingent Consideration Provision \| Level 3
Disclosure Of Financial Assets And Liabilities [Line Items]
Percentage of liabilities measured at fair value							100.00%		100.00%
Borrowings - NovaQuest \| Tranche One \| Gross debt - fixed interest rates
Disclosure Of Financial Assets And Liabilities [Line Items]
Borrowings					$ 30,000,000
Borrowings - NovaQuest \| Tranche Two \| Gross debt - fixed interest rates
Disclosure Of Financial Assets And Liabilities [Line Items]
Borrowings					$ 10,000,000
Oaktree Capital Management
Disclosure Of Financial Assets And Liabilities [Line Items]
Minimum unrestricted cash balance							$ 35,000,000
Top of Range
Disclosure Of Financial Assets And Liabilities [Line Items]
Trade receivables settlement period							60 days

Consolidated Statement of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Cash flows from operating activities
Commercialization revenue received	$ 3,971	$ 3,667
Government grants and tax incentives and credits received	2,565	18
Payments to suppliers and employees (inclusive of goods and services tax)	(33,994)	(34,633)
Interest received	887	207
Income taxes paid	(1)	0
Net cash (outflows) in operating activities	(26,572)	(30,741)
Cash flows from investing activities
Investment in fixed assets	(194)	(187)
Receipts from investment in sublease	116	0
Payments for intellectual property	(10)	(50)
Net cash (outflows) in investing activities	(88)	(237)
Cash flows from financing activities
Payment of transaction costs from borrowings	(540)	(217)
Interest and other costs of finance paid	(2,845)	(2,807)
Proceeds from issue of shares	39,708	45,065
Payments for share issue costs	(2,578)	(2,646)
Payments for lease liabilities	(2,145)	(1,109)
Net cash inflows by financing activities	31,600	38,286
Net increase in cash and cash equivalents	4,940	7,308
Cash and cash equivalents at beginning of period	71,318	60,447
FX gains/(losses) on the translation of foreign bank accounts	1,296	(136)
Cash and cash equivalents at end of period	$ 77,554	$ 67,619

Consolidated Balance Sheet - USD ($) $ in Thousands	Dec. 31, 2023	Jun. 30, 2023
Current Assets
Cash & cash equivalents	$ 77,554	$ 71,318
Trade & other receivables	3,998	6,998
Prepayments	3,602	3,342
Total Current Assets	85,154	81,658
Non-Current Assets
Property, plant and equipment	1,171	1,357
Right-of-use assets	4,329	5,134
Financial assets at fair value through other comprehensive income	826	1,757
Other non-current assets	2,241	2,326
Intangible assets	576,564	577,183
Total Non-Current Assets	585,131	587,757
Total Assets	670,285	669,415
Current Liabilities
Trade and other payables	10,760	20,145
Provisions	8,230	6,399
Borrowings	8,534	5,952
Lease liabilities	2,851	4,060
Warrant liability	992	5,426
Total Current Liabilities	31,367	41,982
Non-Current Liabilities
Provisions	17,073	16,612
Borrowings	107,228	102,811
Lease liabilities	3,386	3,672
Deferred consideration	2,500	2,500
Total Non-Current Liabilities	130,187	125,595
Total Liabilities	161,554	167,577
Net Assets	508,731	501,838
Equity
Issued Capital	1,286,229	1,249,123
Reserves	75,846	73,520
(Accumulated losses)	(853,344)	(820,805)
Total Equity	$ 508,731	$ 501,838

Financial assets and liabilities - Summary of Fair Value of Warrants (Parenthetical) (Details)	6 Months Ended	12 Months Ended
	Dec. 31, 2023 USD ($) Year $ / shares shares	Jun. 30, 2023 USD ($) Year $ / shares shares
Disclosure Of Financial Instruments [Line Items]
Issuance warrants exercised period	7 years
Warrants
Disclosure Of Financial Instruments [Line Items]
Number of warrants granted to purchase american depositary shares (in shares) \| shares	2,224,669	2,224,669
Fair value \| $	$ 992,233	$ 5,426,212
Warrants \| Maximum
Disclosure Of Financial Instruments [Line Items]
Exercise price (in australian dollars per share) \| $ / shares	$ 7.26	$ 7.26
Expected Term \| Year	7	7
Warrants \| Minimum
Disclosure Of Financial Instruments [Line Items]
Exercise price (in australian dollars per share) \| $ / shares	$ 3.70
Expected Term \| Year	5	6

Consolidated Statement of Comprehensive Income - USD ($) $ in Thousands	6 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Statement of comprehensive income [abstract]
Loss for the period	$ (32,539)	$ (41,370)
Items that may be reclassified to profit and loss
Exchange differences on translation of foreign operations	1,164	100
Items that will not be reclassified to profit and loss
Financial assets at fair value through other comprehensive income	(931)	192
Other comprehensive (loss)/income for the period, net of tax	233	292
Total comprehensive losses attributable to the owners of Mesoblast Limited	$ (32,306)	$ (41,078)

Cash flow information

6 Months Ended

Dec. 31, 2023

Statement of cash flows [abstract]

Cash flow information


(in U.S. dollars, in thousands) (a) Reconciliation of cash and cash equivalents	As of December 31, 2023	As of June 30, 2023
Cash at bank	77,144	70,920
Deposits at call	410	398
	77,554	71,318


(in U.S. dollars, in thousands)	Six Months Ended December 31,
(b) Reconciliation of net cash flows used in operations with loss after income tax	2023	2022
Loss for the period	(32,539)	(41,370)
Add/(deduct) net loss for non-cash items as follows:
Depreciation and amortization	2,443	2,190
Foreign exchange (gains)/losses	(159)	193
Finance costs	10,319	10,685
Remeasurement of contingent consideration	337	(5,989)
Remeasurement of warrant liabilities	(4,434)	712
Equity settled share-based payment	2,195	1,757
Deferred tax benefit	(102)	(126)
Change in operating assets and liabilities:
Decrease/(increase) in trade and other receivables	2,084	(743)
Decrease/(increase) in prepayments	(131)	(424)
Decrease/(increase) in tax incentive recoverable	1,094	—
Increase/(decrease) in trade creditors and accruals	(9,500)	2,608
Increase/(decrease) in provisions	1,821	(234)
Net cash outflows used in operations	(26,572)	(30,741)

Loss before income tax (Tables)

6 Months Ended

Dec. 31, 2023

Disclosure Of Loss Before Income Tax [Abstract]

Summary of Loss Before Income Tax


		Six Months Ended December 31,
(in U.S. dollars, in thousands)	Note	2023	2022
Revenue
Commercialization revenue		3,388	3,422
Total Revenue		3,388	3,422

Clinical trial and research & development		(2,045)	(4,067)
Manufacturing production & development		(5,484)	(11,717)

Employee benefits
Salaries and employee benefits		(10,096)	(9,842)
Defined contribution superannuation expenses		(199)	(186)
Equity settled share-based payment transactions(1)		(2,195)	(1,757)
Total Employee benefits		(12,490)	(11,785)

Depreciation and amortization of non-current assets
Plant and equipment depreciation		(281)	(565)
Right of use asset depreciation		(1,420)	(875)
Intellectual property amortization		(742)	(750)
Total Depreciation and amortization of non-current assets		(2,443)	(2,190)

Other Management & administration expenses
Overheads & administration		(4,594)	(5,187)
Consultancy		(1,285)	(1,967)
Legal and other professional fees		(1,124)	(1,053)
Intellectual property expenses (excluding the amount amortized above)		(1,410)	(1,505)
Total Other Management & administration expenses(2)		(8,413)	(9,712)

Fair value remeasurement of contingent consideration
Remeasurement of contingent consideration	5(e)(iii)	(337)	5,989
Total Fair value remeasurement of contingent consideration		(337)	5,989

Fair value remeasurement of warrant liability
Remeasurement of warrant liability	5(e)(vi)	4,434	(712)
Total Fair value remeasurement of warrant liability		4,434	(712)

Other operating income and expenses
Interest revenue		903	214
Foreign exchange gains/(losses)		165	(253)
Total Other operating income and expenses		1,068	(39)

Finance (costs)/gains
Remeasurement of borrowing arrangements		(120)	(1,230)
Interest expense		(10,199)	(9,455)
Total Finance costs		(10,319)	(10,685)

Total loss before income tax		(32,641)	(41,496)

(1)Share-based payment transactions

For the six months ended December 31, 2023 and 2022, the share-based payment transactions have been reflected in the Consolidated Income Statement functional expense categories as follows:


	Six Months Ended December 31,
(in U.S. dollars)	2023	2022
Research and development	1,104,007	797,058
Manufacturing and commercialization	48,064	(183,720)
Management and administration	1,043,365	1,143,560
Equity settled share-based payment transactions	2,195,436	1,756,898

(2)Change in comparative figures

Equity - Summary of Warrant Reserve (Details) - USD ($) $ in Thousands	6 Months Ended		12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Jun. 30, 2023
Disclosure Of Warrant Reserve [Line Items]
Beginning balance	$ 501,838	$ 497,044	$ 497,044
Movement during the period	2,093	1,631
Ending balance	508,731	500,002	501,838
Warrants
Disclosure Of Warrant Reserve [Line Items]
Beginning balance	12,969	$ 12,969	12,969
Movement during the period	0		0
Ending balance	$ 12,969		$ 12,969

- Definition

The amount of residual interest in the assets of the entity after deducting all its liabilities.

+ References + Details

Document and Entity Information	6 Months Ended
Document and Entity Information	Dec. 31, 2023
Cover [Abstract]
Document Type	6-K
Document Period End Date	Dec. 31, 2023
Entity File Number	001-37626
Entity Registrant Name	Mesoblast Limited
Entity Address, Address Line One	Level 38
Entity Address, Address Line Two	55 Collins Street
Entity Address, City or Town	Melbourne
Entity Address, Postal Zip Code	3000
Entity Address, Country	AU
Entity Central Index Key	0001345099
Current Fiscal Year End Date	--06-30
Amendment Flag	false

Equity - Schedule of Share Capital (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Jun. 30, 2023	Dec. 31, 2022	Jun. 30, 2022
Contributed equity
Total Equity	$ 508,731	$ 501,838	$ 500,002	$ 497,044
Ordinary Shares
Contributed equity
Ordinary shares (in shares)	1,015,342,237	814,204,825	737,121,218	650,454,551
Less: Treasury Shares (in shares)	(542,903)		(542,903)
Total Contributed Equity (in shares)	1,014,799,334		736,578,315
Ordinary shares	$ 1,286,229		$ 1,207,714
Less: Treasury Shares	0		0
Total Equity	$ 1,286,229	$ 1,249,123	$ 1,207,714	$ 1,165,309

- Definition

The amount of residual interest in the assets of the entity after deducting all its liabilities.

+ References + Details

Financial risk management - Additional Information (Details) - USD ($)	6 Months Ended	12 Months Ended
	Dec. 31, 2023	Jun. 30, 2023
Disclosure of Financial Risk Management [Line Items]
Percentage of forecast net sales	20.00%
Non-cancellable purchase commitments related to raw materials, manufacturing agreements and other goods and services	$ 5,700,000
Other purchase commitments	0
Manufacturing Service Agreement
Disclosure of Financial Risk Management [Line Items]
Minimum financial commitment reduction amount	7,400,000
Minimum financial commitment reduction amount on lease component	1,500,000
Minimum financial commitment reduction amount on non lease component	5,900,000
Lonza Bioscience Singapore Pte. Ltd \| Manufacturing Service Agreement
Disclosure of Financial Risk Management [Line Items]
Minimum remaining financial commitment of non-lease component on exercise of option to extend non-cancellable term	12,700,000
Minimum financial commitment of lease component on exercise of option to extend non-cancellable term	$ 2,500,000
Interest Rate Risk
Disclosure of Financial Risk Management [Line Items]
Effect on profit from change in interest rates	10.00%	10.00%
Liquidity Risk
Disclosure of Financial Risk Management [Line Items]
Non interest bearing financial liabilities maturity period	6 months	6 months
USD \| Currency Risk
Disclosure of Financial Risk Management [Line Items]
Percentage of cash held	68.00%	67.00%
AUD \| Currency Risk
Disclosure of Financial Risk Management [Line Items]
Percentage of cash held	31.00%	33.00%
Other Currency \| Currency Risk
Disclosure of Financial Risk Management [Line Items]
Percentage of cash held	1.00%

Financial assets and liabilities - Summary of Borrowings (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Dec. 31, 2023	Jun. 30, 2023	Nov. 19, 2021
Borrowings
Borrowing arrangements	$ 81,919	$ 81,919
Less: transaction costs	(9,215)	(8,740)
Amortization of carrying amount, net of payments made	43,058	35,584
Principal amount of loans	115,762	108,763
Non-current
Current	8,534	5,952
Non-current	107,228	102,811
Total borrowings	115,762	108,763
Borrowings - NovaQuest
Non-current
Current	367	336
Non-current	60,878	55,739
Borrowings - Oaktree
Borrowings
Principal amount of loans			$ 60,000
Non-current
Current	8,167	5,616
Non-current	$ 46,350	$ 47,072
Total borrowings			$ 60,000

Significant changes in the current reporting period (Details) $ / shares in Units, $ in Millions, $ in Millions	6 Months Ended
	Dec. 31, 2023 USD ($)	Dec. 31, 2023 AUD ($) $ / shares	Dec. 31, 2022 $ / shares	Dec. 31, 2021	Mar. 31, 2021 $ / shares
Disclosure Of Significant Changes In Current Reporting Period [Line Items]
Proceeds from private placement	$ 39.7
Private Placement
Disclosure Of Significant Changes In Current Reporting Period [Line Items]
Conversion ratio of warrants		0.25		0.25
Number of shares issued, value		$ 60.3
Exercise price (in australian dollars per share) \| $ / shares		$ 0.30	$ 0.75		$ 2.30

Financial assets and liabilities - Summary of Trade and Other Receivables (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Jun. 30, 2023
Disclosure Of Financial Assets And Liabilities [Abstract]
Trade debtors	$ 1,804	$ 2,276
Tax incentives recoverable	1,271	2,363
Foreign withholding tax recoverable	471	471
U.S. Tax credits	0	1,473
Net investment in sublease	216	195
Interest receivables	11	18
Other recoverable taxes (Goods and services tax and value-added tax)	225	202
Trade and other receivables	$ 3,998	$ 6,998

Financial assets and liabilities - Summary of Net Debt Reconciliation (Details) - USD ($) $ in Thousands	6 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Disclosure Of Financial Assets And Liabilities [Abstract]
Borrowings at beginning of period	$ (108,763)
Leases at beginning of period	(7,732)
Warrant liability at beginning of period	(5,426)	$ (2,185)
Sub-total at beginning of period	(121,921)
Cash and cash equivalents at beginning of period	71,318	60,447
Net debt total at beginning of period	(50,603)
Cash Flows, Borrowings	3,163
Cash Flows, Leases	2,337
Cash Flows, Warrants liability	0
Cash Flows, Sub-total	5,500
Cash Flows, Cash and cash equivalents	4,940	7,308
Cash Flows, Total	10,440
Remeasurement adjustments, Borrowings	(120)
Remeasurement adjustments, Warrant liability	4,434
Remeasurement adjustments	4,314
Other Changes, Borrowings	(10,042)
Other Changes, Leases	(782)
Other Changes	(10,824)
Foreign exchange adjustments, Leases	(60)
Foreign exchange adjustments, Warrant liability	0
Foreign exchange adjustments, Sub-total	(60)
Foreign exchange adjustments, cash and cash equivalents	1,296	(136)
Foreign exchange adjustments, Total	1,236
Borrowings at end of period	(115,762)
Leases at end of period	(6,237)
Warrant liability at end of period	(992)
Sub-total at end of period	(122,991)
Cash and cash equivalents at end of period	77,554	$ 67,619
Net debt total at end of period	$ (45,437)

Income tax benefit/(expense) - Summary of Income Tax Expense/(Benefit) (Details) - USD ($) $ in Thousands	6 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Current tax
Current tax	$ 0	$ 0
Total current tax (benefit)/expense	0	0
Deferred tax
(Increase)/decrease in deferred tax assets	22	0
(Decrease)/increase in deferred tax liabilities	(124)	(126)
Total deferred tax (benefit)/expense	(102)	(126)
Income tax (benefit)/expense	$ (102)	$ (126)

- Definition

The aggregate amount included in the determination of profit (loss) for the period in respect of current tax and deferred tax. [Refer: Current tax expense (income); Deferred tax expense (income)]

+ References + Details

Financial assets and liabilities - Summary of Changes in Fair Value of Level 3 Instruments (Details) - USD ($) $ in Thousands	6 Months Ended		12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Jun. 30, 2023
Disclosure Of Financial Instruments [Line Items]
Remeasurement	$ 337	$ (5,989)
Level 3
Disclosure Of Financial Instruments [Line Items]
Opening balance	17,199	$ 23,284	$ 23,284
Reclassification during the period			2,686
Remeasurement	337		(8,771)
Closing balance	$ 17,536		$ 17,199

Non-financial assets and liabilities - Summary of Deferred Tax Balances (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Jun. 30, 2023
Deferred tax assets
Tax losses	$ 74,684	$ 76,020
Other temporary differences	13,185	11,972
Total deferred tax assets	87,869	87,992
Deferred tax liabilities
Intangible assets	87,869	87,992
Total deferred tax liabilities	87,869	87,992
Net deferred tax liabilities	$ 0	$ 0

Events occurring after the reporting period	6 Months Ended
Events occurring after the reporting period	Dec. 31, 2023
Disclosure of non-adjusting events after reporting period [abstract]
Events occurring after the reporting period	Events occurring after the reporting periodThere were no events that have occurred after December 31, 2023 and prior to the signing of this financial report that would likely have a material impact on the financial results presented.

Loss before income tax - Summary of Loss Before Income Tax (Details) - USD ($) $ in Thousands	6 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Revenue
Commercialization revenue	$ 3,388	$ 3,422
Total Revenue	3,388	3,422
Clinical trial and research & development	(2,045)	(4,067)
Manufacturing production & development	(5,484)	(11,717)
Employee benefits
Salaries and employee benefits	(10,096)	(9,842)
Defined contribution superannuation expenses	(199)	(186)
Equity settled share-based payment transactions	(2,195)	(1,757)
Total Employee benefits	(12,490)	(11,785)
Depreciation and amortization of non-current assets
Plant and equipment depreciation	(281)	(565)
Right of use asset depreciation	(1,420)	(875)
Intellectual property amortization	(742)	(750)
Total Depreciation and amortization of non-current assets	(2,443)	(2,190)
Other Management & administration expenses
Overheads & administration	(4,594)	(5,187)
Consultancy	(1,285)	(1,967)
Legal and other professional fees	(1,124)	(1,053)
Intellectual property expenses (excluding the amount amortized above)	(1,410)	(1,505)
Total Other Management & administration expenses	(8,413)	(9,712)
Fair value remeasurement of contingent consideration
Remeasurement of contingent consideration	(337)	5,989
Total Fair value remeasurement of contingent consideration	(337)	5,989
Fair value remeasurement of warrant liability
Remeasurement of warrant liability	4,434	(712)
Total Fair value remeasurement of warrant liability	4,434	(712)
Other operating income and expenses
Interest revenue	903	214
Foreign exchange gains/(losses)	165	(253)
Total Other operating income and expenses	1,068	(39)
Finance (costs)/gains
Remeasurement of borrowing arrangements	(120)	(1,230)
Interest expense	(10,199)	(9,455)
Total Finance costs	(10,319)	(10,685)
Loss before income tax	$ (32,641)	$ (41,496)

Non-financial assets and liabilities - Summary of Carrying Value of In Process Research and Development Acquired by Product (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Jun. 30, 2023	Jun. 30, 2022
Disclosure Of Intangible Assets [Line Items]
Carrying value of in process research and development	$ 576,564	$ 577,183	$ 578,652
In-process research and development acquired
Disclosure Of Intangible Assets [Line Items]
Carrying value of in process research and development	427,779	427,779	$ 427,779
In-process research and development acquired \| Cardiovascular Products
Disclosure Of Intangible Assets [Line Items]
Carrying value of in process research and development	254,351	254,351
In-process research and development acquired \| Intravenous products for metabolic diseases and inflammatory/immunologic conditions
Disclosure Of Intangible Assets [Line Items]
Carrying value of in process research and development	70,730	70,730
In-process research and development acquired \| MSC Products
Disclosure Of Intangible Assets [Line Items]
Carrying value of in process research and development	$ 102,698	$ 102,698

Equity

6 Months Ended

Dec. 31, 2023

Disclosure of classes of share capital [abstract]

Equity

a. Contributed equity

(i) Share capital


	As of December 31,
	2023	2022	2023	2022
	Shares No.		(U.S. dollars, in thousands)
Contributed equity
(i)Share capital
Ordinary shares	1,015,342,237	737,121,218	1,286,229	1,207,714
Less: Treasury Shares	(542,903)	(542,903)	—	—
Total Contributed Equity	1,014,799,334	736,578,315	1,286,229	1,207,714

(ii) Movements in ordinary share capital


	Six Months Ended December 31,		Six Months Ended December 31,
	2023	2022	2023	2022
	Shares No.		(U.S. dollars, in thousands)
Opening balance	814,204,825	650,454,551	1,249,123	1,165,309
Issues of ordinary shares during the period
Placement of shares under a share placement agreement(1)(2)	201,137,412	86,666,667	39,708	45,065
Transaction costs arising on share issue	—	—	(2,602)	(2,660)
Total contributions of equity during the period	201,137,412	86,666,667	37,106	42,405
Share options reserve transferred to equity on exercise of options	—	—	—	—
Ending balance	1,015,342,237	737,121,218	1,286,229	1,207,714


(1)During the six months ended December 31, 2023, 201,137,412 shares were issued in a 1 for 4 pro-rata accelerated non-renounceable entitlement offer of new fully paid ordinary shares in Mesoblast Limited to existing shareholders in Australia and certain other countries together with an institutional placement of new fully paid ordinary shares in Mesoblast Limited, at A$0.30 per share.

(2)During the six months ended December 31, 2022, 86,666,667 shares were issued in an equity purchase of Mesoblast Limited at A$0.75 per share to existing and new institutional investors.

(iii) Movements of shares in share trust


	Six Months Ended December 31,		Six Months Ended December 31,
	2023	2022	2023	2022
	Shares No.		(U.S. dollars, in thousands)
Opening balance	542,903	542,903	—	—
Movement of shares in share trust
Exercise of share options(1)	—	—	—	—
Ending balance	542,903	542,903	—	—


(1)Options are issued to employees, directors and consultants in accordance with the Mesoblast Employee Share Option Plan. From July 1, 2020, unpaid shares are issued to the share trust to enable future option exercises to be settled. On exercise of options, the proceeds of the exercise are recorded in ordinary share capital in Mesoblast Limited and the exercise is settled by transfer of the shares from the share trust to the employee. Prior to July 1, 2020, the shares issued and share capital received on the exercise of options were recorded in ordinary share capital.

b. Warrant reserve


(in U.S. dollars, in thousands)	As of December 31,	As of June 30,
Warrant reserve	2023	2023
Opening balance	12,969	12,969
Movement during the period	—	—
Closing Balance	12,969	12,969

In March 2021, the Group completed a A$138.0 million (US$110.0 million) private placement of 60,109,290 new fully-paid ordinary shares at a price of A$2.30. As part of this placement, the Group also issued one warrant for every four ordinary shares issued in the placement, which resulted in a further 15,027,327 warrants issued. Each warrant has an exercise price of A$2.88 per share and a 7-year term. The Group has a right to compel exercise of the warrants at any time, subject to the price of the Group’s ordinary shares trading at least A$4.32 for 45 consecutive days on the ASX. The warrants do not confer any rights to dividends or a right to participate in a new issue without exercising the warrant. As a result of completing the pro-rata accelerated non-renounceable rights issue in December 2023, the exercise price for the warrants was adjusted from A$2.88 per share to A$2.86 per share with effect from January 5, 2024.

The terms of the warrants include certain anti-dilution clauses, which adjust the exercise price or conversion ratio in the event of a rights issue or bonus issue. Management analyzed these clauses and determined the fixed-for-fixed requirement was still satisfied because the relative rights of shareholders and warrant holders were maintained. Therefore the warrants were classified as equity. The warrants were initially measured in equity at fair value, which was determined using a Monte Carlo simulation (refer to Note 7(b)(iv) in the Form 20-F for the year ended June 30, 2023 for more details), with the residual consideration being attributed to the ordinary shares issued in the same transaction. The warrants are not remeasured for subsequent changes in fair value.

Financial risk management - Schedule of Increase/Decrease of Share Price (Details) - USD ($)	Dec. 31, 2023	Jun. 30, 2023	Jun. 30, 2022
Disclosure of Financial Risk Management [Line Items]
Warrant liability	$ 992,000	$ 5,426,000	$ 2,185,000
Percentage of increase and decrease in share price	10.00%	10.00%
Top of Range
Disclosure of Financial Risk Management [Line Items]
Ten percent of increase in share price	$ (144,000)	$ (698,000)
Bottom of Range
Disclosure of Financial Risk Management [Line Items]
Ten percent of decrease in share rice	$ 140,000	$ 686,000

Cash flow information (Tables)

6 Months Ended

Dec. 31, 2023

Statement of cash flows [abstract]

Summary of Cash Flow Information


(in U.S. dollars, in thousands) (a) Reconciliation of cash and cash equivalents	As of December 31, 2023	As of June 30, 2023
Cash at bank	77,144	70,920
Deposits at call	410	398
	77,554	71,318


(in U.S. dollars, in thousands)	Six Months Ended December 31,
(b) Reconciliation of net cash flows used in operations with loss after income tax	2023	2022
Loss for the period	(32,539)	(41,370)
Add/(deduct) net loss for non-cash items as follows:
Depreciation and amortization	2,443	2,190
Foreign exchange (gains)/losses	(159)	193
Finance costs	10,319	10,685
Remeasurement of contingent consideration	337	(5,989)
Remeasurement of warrant liabilities	(4,434)	712
Equity settled share-based payment	2,195	1,757
Deferred tax benefit	(102)	(126)
Change in operating assets and liabilities:
Decrease/(increase) in trade and other receivables	2,084	(743)
Decrease/(increase) in prepayments	(131)	(424)
Decrease/(increase) in tax incentive recoverable	1,094	—
Increase/(decrease) in trade creditors and accruals	(9,500)	2,608
Increase/(decrease) in provisions	1,821	(234)
Net cash outflows used in operations	(26,572)	(30,741)

Non-financial assets and liabilities - Summary of Provisions (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Jun. 30, 2023
Disclosure Of Other Provisions [Line Items]
Current	$ 8,230	$ 6,399
Non-current	17,073	16,612
Total	25,303	23,011
Contingent consideration
Disclosure Of Other Provisions [Line Items]
Current	500	636
Non-current	17,036	16,563
Total	17,536	17,199
Employee benefits
Disclosure Of Other Provisions [Line Items]
Current	3,980	2,013
Non-current	37	49
Total	4,017	2,062
Provision for license agreements
Disclosure Of Other Provisions [Line Items]
Current	3,750	3,750
Non-current	0	0
Total	$ 3,750	$ 3,750

Financial assets and liabilities - Summary of Cash and Cash Equivalents (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Jun. 30, 2023	Dec. 31, 2022	Jun. 30, 2022
Disclosure Of Financial Assets And Liabilities [Abstract]
Cash at bank	$ 77,144	$ 70,920
Deposits at call	410	398
Cash and cash equivalents	$ 77,554	$ 71,318	$ 67,619	$ 60,447

Financial assets and liabilities - Summary of Net Debt (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Jun. 30, 2023	Dec. 31, 2022	Jun. 30, 2022
Disclosure Of Reconciliation Of Liabilities Arising From Financing Activities [Line Items]
Cash and cash equivalents	$ 77,554	$ 71,318	$ 67,619	$ 60,447
Borrowings	(115,762)	(108,763)
Lease liabilities	(6,237)	(7,732)
Warrant liability	(992)	(5,426)		$ (2,185)
Net Debt	(45,437)	(50,603)
Gross debt - fixed interest rates
Disclosure Of Reconciliation Of Liabilities Arising From Financing Activities [Line Items]
Borrowings	(121,999)	(116,495)
Gross debt - variable interest rates
Disclosure Of Reconciliation Of Liabilities Arising From Financing Activities [Line Items]
Borrowings	$ 0	$ 0

Financial assets and liabilities - Summary of Cash and Cash Equivalents (Parenthetical) (Details) - USD ($) $ in Millions	Dec. 31, 2023	Jun. 30, 2023
Disclosure Of Financial Assets And Liabilities [Abstract]
Interest-bearing deposits at call held as security	$ 0.4	$ 0.4

(Losses) per share (Details) - USD ($) $ / shares in Units, $ in Thousands	6 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
(a) Basic (losses) per share
From continuing operations attributable to the ordinary equity holders of the company (in dollars per share)	$ (0.0382)	$ (0.0564)
Total basic (losses) per share attributable to the ordinary equity holders of the company (in dollars per share)	(0.0382)	(0.0564)
(b) Diluted (losses) per share
From continuing operations attributable to the ordinary equity holders of the company (in dollars per share)	(0.0382)	(0.0564)
Total diluted (losses) per share attributable to the ordinary equity holders of the company (in dollars per share)	$ (0.0382)	$ (0.0564)
(c) (Losses) used in calculating (losses) per share
From continuing operations	$ (32,539)	$ (41,370)
Used in calculating basic (losses) per share	(32,539)	(41,370)
(Losses) attributable to the ordinary equity holders of the company used in calculating diluted losses per share	$ (32,539)	$ (41,370)
Weighted average number of ordinary shares used as the denominator in calculating basic losses per share (in shares)	851,464,145	733,282,900
Weighted average number of ordinary shares and potential ordinary shares used in calculating diluted losses per share (in shares)	851,464,145	733,282,900

Equity - Summary of Movements of Shares in Share Trust (Details)	6 Months Ended
	Dec. 31, 2023 USD ($) shares	Dec. 31, 2022 USD ($) shares
Disclosure Of Movements Of Shares In Share Trust [Line Items]
Exercise of share options		$ 0
Mesoblast Employee Share Trust
Disclosure Of Movements Of Shares In Share Trust [Line Items]
Opening balance (in shares) \| shares	542,903	542,903
Opening balance	$ 0	$ 0
Exercise of share options (in shares) \| shares	0	0
Exercise of share options	$ 0	$ 0
Ending balance (in shares) \| shares	542,903	542,903
Ending balance	$ 0	$ 0

Non-financial assets and liabilities

Jun. 30, 2023

Disclosure Of Non Financial Assets And Liabilities [Abstract]

Non-financial assets and liabilities

a. Intangible assets


(in U.S. dollars, in thousands)	Goodwill	Acquired licenses to patents	In-process research and development acquired	Current marketed products	Total
Year Ended June 30, 2023
Opening net book amount	134,453	1,632	427,779	14,788	578,652
Additions	—	23	—	—	23
Exchange differences	—	1	—	—	1
Amortization charge	—	(38)	—	(1,455)	(1,493)
Closing net book amount	134,453	1,618	427,779	13,333	577,183

As of June 30, 2023
Cost	134,453	2,993	489,698	23,999	651,143
Accumulated amortization	—	(1,375)	—	(10,666)	(12,041)
Accumulated impairment	—	—	(61,919)	—	(61,919)
Net book amount	134,453	1,618	427,779	13,333	577,183

Six Months Ended December 31, 2023
Opening net book amount	134,453	1,618	427,779	13,333	577,183
Additions	—	122	—	—	122
Exchange differences	—	1	—	—	1
Amortization charge	—	(15)	—	(727)	(742)
Closing net book amount	134,453	1,726	427,779	12,606	576,564

As of December 31, 2023
Cost	134,453	3,131	489,698	24,000	651,282
Accumulated amortization	—	(1,405)	—	(11,394)	(12,799)
Accumulated impairment	—	—	(61,919)	—	(61,919)
Net book amount	134,453	1,726	427,779	12,606	576,564

(i) Carrying value of in-process research and development acquired by product


(in U.S. dollars, in thousands)	As of December 31, 2023	As of June 30, 2023
Cardiovascular products(1)	254,351	254,351
Intravenous products for metabolic diseases and inflammatory/immunologic conditions(2)	70,730	70,730
MSC products(3)	102,698	102,698
	427,779	427,779

(1)Includes MPC-150-IM for the treatment or prevention of chronic heart failure and MPC-25-IC for the treatment or prevention of acute myocardial infarction

(2)Includes MPC-300-IV for the treatment of biologic-refractory rheumatoid arthritis and diabetic nephropathy

(3)Includes remestemcel-L for the treatment of adults and children with SR-aGVHD and remestemcel-L for the treatment of Crohn’s disease

For all products included within the above balances, the underlying currency of each item recorded is US$.

(ii) Significant estimate: Impairment of goodwill and assets with an indefinite useful life

The Group tests annually, or more frequently if events or changes in circumstances indicate that they might be impaired, whether goodwill and its assets with indefinite useful lives have suffered any impairment in accordance with its accounting policy stated in Note 23(j) in the Form 20-F for the year ended June 30, 2023. The recoverable amounts of these assets and cash-generating units have been determined based on fair value less costs to dispose calculations, which require the use of market-participant assumptions that are based on development strategies using external data sources as well as past experience. The full annual impairment assessment was performed at March 31, 2023 and no impairment of the in-process research and development and goodwill were identified.

In August 2023, the FDA issued a complete response to the Group's BLA for remestemcel-L for the treatment of pediatric SR-aGVHD and the Group considered this to be an impairment indicator that could cause the carrying amount of its intangible assets to exceed its recoverable amounts. As a result, the Group completed an impairment assessment on its MSC products intangible asset and goodwill. The assumptions used in the impairment assessment were updated from the March 31, 2023 impairment assessment and included changes to the market population and penetration, product pricing and launch timings. There were no other significant changes in key assumptions, including the probability of success. No impairment to the in-process research and development and goodwill was identified.

(iii) Impairment tests for goodwill and intangible assets with an indefinite useful life

In-process research and development acquired is considered to be an indefinite life intangible asset on the basis that it is incomplete and cannot be used in its current form (see Note 23(p)(iii) in the Form 20-F for the year ended June 30, 2023). The intangible asset’s life will remain indefinite until such time it is completed and commercialized or impaired. The carrying value of in-process research and development is a separate asset which has been subject to impairment testing at the cash generating unit level, which has been determined to be at the product level.

On acquisition, goodwill was not able to be allocated to the cash generating unit (“CGU”) level or to a group of CGU given the synergies of the underlying research and development. For the purpose of impairment testing, goodwill is monitored by management at the operating segment level. The Group is managed as one operating segment, being the development of cell technology platform for commercialization.

The recoverable amount of both goodwill and in-process research and development was assessed as of March 31, 2023 based on the fair value less costs to dispose. As a result of the receipt of the complete response from the FDA in August 2023, an impairment assessment was performed over the in-process research and development value of the MSC asset and goodwill. No impairment was identified as a result of these impairment assessments. Management assessed assets for indicators of impairment as at December 31, 2023 including considering events up to the date of the approval of the financial statements and no indicators of impairment were identified.

(iv) Key assumptions used for fair value less costs to dispose calculations

In determining the fair value less costs to dispose the Group has given consideration to the following internal and external indicators:

•discounted expected future cash flows of programs valued by the Group’s internal valuation team and reviewed by the interim CFO. The valuation team also manages a process to continually refine the key assumptions within the model. This is done with input from the relevant business units. The key assumptions in the model have been clearly defined and the responsibility for refining those assumptions has been assigned to the most relevant business units. When determining key assumptions, the business units refer to both external sources and past experience as appropriate. The valuation is considered to be level 3 in the fair value hierarchy due to unobservable inputs used in the valuation;

•the scientific results and progress of the trials since acquisition;

•the market capitalization of the Group on the ASX (ASX:MSB); and

•the valuation of the Group’s assets from an independent valuation. An independent valuation was obtained for all assets at March 31, 2023 and for the MSC products an impairment assessment was performed as a result of the receipt of the complete response.

Costs of disposal were assumed to be immaterial.

Discounted cash-flows used a real post-tax discount rate range of 13.8% to 15.5%, and include estimated real cash inflows and outflows for each program through to expected patent expiry which ranges from 9 to 25 years.

In relation to cash outflows consideration has been given to cost of goods sold, selling costs and clinical trial schedules including estimates of numbers of patients and per patient costs. Associated expenses such as regulatory fees and patent maintenance have been included as well as any further preclinical development if applicable.

In relation to cash inflows consideration has been given to product pricing, market population and penetration, sales rebates and discounts, launch timings and probability of success in the relevant applicable markets.

There are no standard growth rates applied, other than our estimates of market penetration which increase initially, plateau and then decline.

The assessment of the recoverable amount of each product has been made in accordance with the discounted cash-flow assumptions outlined above. The assessments showed that the recoverable amount of each product exceeds the carrying amount and therefore there is no impairment.

The assessment of goodwill showed the recoverable amount of the Group's operating segment, including goodwill and remaining in-process research and development, exceeds carrying amounts, and therefore there is no impairment.

(v) Impact of possible changes in key assumptions

The Group has considered and assessed reasonably possible changes in the key assumptions and has not identified any instances that could cause the carrying amount of our intangible assets to exceed its recoverable amount.

Whilst there is no impairment, the key sensitivities in the valuation are dependent on the continued successful development of our technology platforms. Future discussion with the FDA could change the assumptions used within the impairment assessments. If the Group is unable to successfully develop its technology platforms, an impairment of the carrying amount of our intangible assets may result.

b. Provisions


	As of December 31, 2023			As of June 30, 2023
(in U.S. dollars, in thousands)	Current	Non-current	Total	Current	Non-current	Total
Contingent consideration(1)	500	17,036	17,536	636	16,563	17,199
Employee benefits	3,980	37	4,017	2,013	49	2,062
Provision for license agreements	3,750	—	3,750	3,750	—	3,750
	8,230	17,073	25,303	6,399	16,612	23,011

(1) The classification of contingent consideration as current represents the expected payments within the next 12 months based on current development timelines.

(i) Information about individual provisions and significant estimates

Contingent consideration

The contingent consideration provision relates to the Group’s liability for certain milestones and royalty achievements pertaining to the acquired MSC assets. Further disclosures can be found in Note 5(e)(iii).

Employee benefits

The provision for employee benefits relates to the Group’s liability for annual leave, short term incentives and long service leave.

Employee benefits include accrued annual leave. As at December 31, 2023 and June 30, 2023, the entire amount of the annual leave accrual was $1.2 million and $1.1 million respectively, and is presented as current, since the Group does not have an unconditional right to defer settlement for any of these obligations.

(ii) Movements

The contingent consideration provision relates to the Group’s liability for certain milestones and royalty achievements. Refer to Note 5(e)(iii) for movements in contingent consideration for the period ended December 31, 2023 and June 30, 2023.

c. Deferred tax balances

(i) Deferred tax balances


(in U.S. dollars, in thousands)	As of December 31, 2023	As of June 30, 2023
Deferred tax assets
The balance comprises temporary differences attributable to:
Tax losses	74,684	76,020
Other temporary differences	13,185	11,972
Total deferred tax assets	87,869	87,992

Deferred tax liabilities
The balance comprises temporary differences attributable to:
Intangible assets	87,869	87,992
Total deferred tax liabilities	87,869	87,992
Net deferred tax liabilities	—	—

(ii) Movements


(in U.S. dollars, in thousands)	Tax losses(1) (DTA)	Other temporary differences(1) (DTA)	Intangible assets (DTL)	Total (DTL)
As of June 30, 2022	(80,411)	(7,831)	88,242	—
Charged/(credited) to:
- profit or loss	4,179	(4,141)	(250)	(212)
- directly to equity	212	—	—	212
As of June 30, 2023	(76,020)	(11,972)	87,992	—
Charged/(credited) to:
- profit or loss	1,234	(1,213)	(123)	(102)
- directly to equity	102	—	—	102
As of December 31, 2023	(74,684)	(13,185)	87,869	—

(1)Deferred tax assets are netted against deferred tax liabilities

Basis of preparation (Policies)	6 Months Ended
Basis of preparation (Policies)	Dec. 31, 2023
Basis Of Preparation [Abstract]
Description of accounting policy for basis of preparation explanatory	Basis of preparation Mesoblast Limited is a for-profit entity for the purpose of preparing the financial statements. The condensed consolidated financial statements of Mesoblast Limited and its subsidiaries have been prepared in accordance with International Accounting Standard IAS 34 Interim Financial Reporting, as issued by the International Accounting Standards Board (“IASB”), and are unaudited. These condensed interim financial statements do not include all of the notes and disclosures required by International Financial Reporting Standards, as issued by the IASB, for annual consolidated financial statements and should therefore be read in conjunction with our annual report on Form 20-F for the year ended June 30, 2023. In the opinion of management, the interim financial data includes all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the results for the interim periods. (i) Going concern As of December 31, 2023, the Group held total cash reserves of $77.6 million. During the six months ended December 31, 2023, the Group executed on reprioritization of projects and operational streamlining activities and as a result has reduced net cash usage for operating activities, which was $26.6 million the six months ended December 31, 2023, a reduction of 14% compared to the prior period. In line with the Group's overall commercial strategy to complete additional pivotal clinical studies for both the Group's chronic lower back pain and steroid-refractory acute graft versus host disease ("SR-aGVHD") product candidates, additional inflows from capital markets, royalty monetization, strategic partnerships or product specific financing will be required to meet the Group's projected expenditure consistent with the Group's business strategy over at least the next 12 months. As a result of these matters, there is material uncertainty related to events or conditions that may cast significant doubt (or raise substantial doubt as contemplated by Public Company Accounting Oversight Board (“PCAOB”) standards) on the Group’s ability to continue as a going concern and, therefore, that the Group may be unable to realize its assets and discharge its liabilities in the normal course of business. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. (ii) Historical cost convention These financial statements have been prepared under the historical cost convention, as modified by the revaluation of financial assets at fair value through other comprehensive income, financial assets and liabilities (including derivative instruments) at fair value through profit or loss, certain classes of property, plant and equipment and investment property. (iii) New and amended standards adopted by the Group There were no new or amended standards adopted by the Group in the six months ended December 31, 2023. These interim financial statements follow the same accounting policies as compared to the June 30, 2023 consolidated financial statements and related notes as filed with the Australian Securities Exchange and the Securities and Exchange Commission. (iv) New accounting standards and interpretations not yet adopted by the Group There were no new accounting standards and interpretations not yet adopted by the Group for the December 31, 2023 reporting period that are expected to materially impact the Group. (v) Use of estimates The preparation of these consolidated financial statements requires the Group to make estimates and judgments that affect the reported amounts of assets, liabilities, income and expenses and related disclosures. On an ongoing basis, the Group evaluates its significant accounting policies and estimates. Estimates are based on historical experience and on various market-specific and other relevant assumptions that the Group believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities. (vi) Impact of after effects of COVID-19 and geopolitical instability Estimates are assessed each period and updated to reflect current information, such as the economic considerations related to the after effects of the COVID-19 pandemic could have on the Group’s significant accounting estimates. The Group is having to account for the after effects of the COVID-19 pandemic on healthcare network, which have been and may continue to be impacted by the pandemic with respect to patient care, operations/staffing, financials, and health and safety protocols. These impacts change the way that Mesoblast will have to engage with relevant collaborators. Due to the effects of the COVID-19 pandemic and recent geopolitical instability, countries in which the Group has operations have experienced some challenges in the ability of the Group’s suppliers and contractors to source, supply or acquire raw materials or components needed for its manufacturing process and supply chain. As a result, the manufacturing and commercialization of remestemcel-L and other product candidates could be adversely affected.

Income tax benefit/(expense) (Tables)

6 Months Ended

Dec. 31, 2023

Major components of tax expense (income) [abstract]

Summary of Income Tax Expense/(Benefit)


	Six Months Ended December 31,
(in U.S. dollars, in thousands)	2023	2022
Income tax (benefit)/expense
Current tax
Current tax	—	—
Total current tax (benefit)/expense	—	—

Deferred tax
(Increase)/decrease in deferred tax assets	22	—
(Decrease)/increase in deferred tax liabilities	(124)	(126)
Total deferred tax (benefit)/expense	(102)	(126)
Income tax (benefit)/expense	(102)	(126)

Summary of Deferred Tax Assets Not Brought to Account


(in U.S. dollars, in thousands)	As of December 31, 2023	As of June 30, 2023
Deferred tax assets not brought to account
Unused tax losses
Potential tax benefit at local tax rates	134,682	125,728
Other temporary differences
Potential tax benefit at local tax rates	13,797	12,318
Other tax credits
Potential tax benefit at local tax rates	3,220	3,220
	151,699	141,266

Financial risk management - Summary of Borrowing to Price Rate Changes (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Jun. 30, 2023
Disclosure of Financial Risk Management [Line Items]
Current borrowings	$ 8,534	$ 5,952
Non-current borrowings	107,228	102,811
Total borrowings	115,762	108,763
Commodity price risk
Disclosure of Financial Risk Management [Line Items]
Current borrowings	367	336
Non-current borrowings	60,878	55,739
Total borrowings	$ 61,245	$ 56,075
Percent of current borrowings	0.00%	0.00%
Percent of non-current borrowings	53.00%	51.00%
Percent of total borrowings	53.00%	51.00%

Financial assets and liabilities - Summary of Trade and Other Payables (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Jun. 30, 2023
Disclosure Of Financial Assets And Liabilities [Abstract]
Trade payables and other payables	$ 10,760	$ 20,145
Trade and other payables	$ 10,760	$ 20,145

Income tax benefit/(expense)

6 Months Ended

Dec. 31, 2023

Major components of tax expense (income) [abstract]

Income tax benefit/(expense)


	Six Months Ended December 31,
(in U.S. dollars, in thousands)	2023	2022
Income tax (benefit)/expense
Current tax
Current tax	—	—
Total current tax (benefit)/expense	—	—

Deferred tax
(Increase)/decrease in deferred tax assets	22	—
(Decrease)/increase in deferred tax liabilities	(124)	(126)
Total deferred tax (benefit)/expense	(102)	(126)
Income tax (benefit)/expense	(102)	(126)

Deferred tax assets have been brought to account only to the extent that it is foreseeable that they are recoverable against future tax liabilities.

Deferred tax assets are recognized for unused tax losses to the extent that it is probable that future taxable profit will be available against which the unused tax losses can be utilized. Deferred tax assets are offset against taxable temporary

differences (deferred tax liabilities) when the deferred tax balances relate to the same tax jurisdiction in accordance with our accounting policy.

Deferred taxes are measured at the rate in which they are expected to settle within the respective jurisdictions, which can change based on factors such as new legislation or timing of utilization and reversal of associated assets and liabilities.


(in U.S. dollars, in thousands)	As of December 31, 2023	As of June 30, 2023
Deferred tax assets not brought to account
Unused tax losses
Potential tax benefit at local tax rates	134,682	125,728
Other temporary differences
Potential tax benefit at local tax rates	13,797	12,318
Other tax credits
Potential tax benefit at local tax rates	3,220	3,220
	151,699	141,266

Financial assets and liabilities - Summary of Warrant Liability (Details) - USD ($) $ in Thousands	6 Months Ended		12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Jun. 30, 2023
Disclosure Of Financial Instruments [Line Items]
Opening balance	$ 5,426	$ 2,185	$ 2,185
Warrants fair value at grant date - December 22, 2022	1,000		5,400
Remeasurement of warrant liability	(4,434)	$ 712	2,205
Closing Balance	992		5,426
Warrants Fair Value at Grant Date December 22, 2022
Disclosure Of Financial Instruments [Line Items]
Warrants fair value at grant date - December 22, 2022	$ 0		$ 1,036

Loss before income tax - Additional Information (Details) € in Millions	1 Months Ended							6 Months Ended
	Jun. 30, 2022 USD ($)	Sep. 30, 2021 USD ($)	Sep. 30, 2021 EUR (€)	Feb. 29, 2020 USD ($)	Dec. 31, 2019 USD ($)	Oct. 31, 2019 USD ($)	Oct. 31, 2018 USD ($) milestone	Dec. 31, 2023 USD ($)	Dec. 31, 2022 USD ($)	Jun. 30, 2023 USD ($)	Dec. 31, 2017 USD ($)	Dec. 31, 2017 EUR (€)
Disclosure Of Loss Before Income Tax [Line Items]
Revenue recognized from up-front payment as deferred consideration				$ 10,000,000
Receipt on non refundable up-front payment upon reaching product regulatory milestone							$ 25,000,000
Escalating milestone payments \| milestone							6
Pre-launch inventory recognized								$ 21,600,000		$ 22,400,000
Manufacturing Commercialization Expenses
Disclosure Of Loss Before Income Tax [Line Items]
Pre-launch inventory recognized								(800,000)	$ 1,600,000
Grunenthal
Disclosure Of Loss Before Income Tax [Line Items]
Non-refundable upfront payment received						$ 15,000,000
Milestone payment received					$ 2,500,000
Percentage of patients to provide regulatory harmonization, cost efficiencies and streamlined timelines	20.00%
Non-refundable upfront payments receivable	$ 17,500,000
Cumulative milestone payments reachable amount	1,000,000,000
Revenue recognized for right of use license of IP								0	0
Grunenthal \| Top of Range \| Clinical, Manufacturing, Regulatory and Reimbursement Approval
Disclosure Of Loss Before Income Tax [Line Items]
Amount entitled to be received upon reaching product clinical and regulatory milestones and reimbursement targets are achieved	$ 112,500,000
Tasly
Disclosure Of Loss Before Income Tax [Line Items]
Deferred consideration milestone consideration recognized							$ 20,000,000
Revenue recognized from up-front payment as deferred consideration							$ 10,000,000
Tasly \| License
Disclosure Of Loss Before Income Tax [Line Items]
Revenue recognized from up-front payment as deferred consideration								0	0
TiGenix NV
Disclosure Of Loss Before Income Tax [Line Items]
Royalty income								200,000	200,000
TiGenix NV \| License
Disclosure Of Loss Before Income Tax [Line Items]
Current contract liabilities											$ 5,900,000	€ 5.0
Non-current contract liabilities											$ 5,900,000	€ 5.0
Revenue from contracts with customers		$ 1,200,000	€ 1.0
TiGenix NV \| Top of Range \| License
Disclosure Of Loss Before Income Tax [Line Items]
Revenue, remaining performance obligation, variable consideration amount \| €			€ 9.0
JCR Pharmaceuticals Co. Ltd
Disclosure Of Loss Before Income Tax [Line Items]
Royalties receivable under sales-based milestones								$ 3,200,000	$ 3,200,000

Non-financial assets and liabilities - Schedule of Movements Related to Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Dec. 31, 2023	Jun. 30, 2023
Deferred Tax Assets And Liabilities [Line Items]
Beginning balance	$ 0	$ 0
Charged/(credited) to:
- profit or loss	(102)	(212)
- directly to equity	102	212
Ending balance	0	0
Tax losses (DTA)
Deferred Tax Assets And Liabilities [Line Items]
Beginning balance	(76,020)	(80,411)
Charged/(credited) to:
- profit or loss	1,234	4,179
- directly to equity	102	212
Ending balance	(74,684)	(76,020)
Other Temporary Differences (DTA)
Deferred Tax Assets And Liabilities [Line Items]
Beginning balance	(11,972)	(7,831)
Charged/(credited) to:
- profit or loss	(1,213)	(4,141)
- directly to equity	0	0
Ending balance	(13,185)	(11,972)
Intangible assets (DTL)
Deferred Tax Assets And Liabilities [Line Items]
Beginning balance	87,992	88,242
Charged/(credited) to:
- profit or loss	(123)	(250)
- directly to equity	0	0
Ending balance	$ 87,869	$ 87,992

Legal proceedings	6 Months Ended
Legal proceedings	Dec. 31, 2023
Legal proceedings provision [abstract]
Legal proceedings	Legal proceedings A class action proceeding in the Federal Court of Australia was served on the Company in May 2022 by the law firm William Roberts Lawyers on behalf of persons who, between February 22, 2018, and December 17, 2020, acquired an interest in Mesoblast shares, American Depository Receipts, and/or related equity swap arrangements. In June 2022, the firm Phi Finney McDonald commenced a second shareholder class action against the Company in the Federal Court of Australia asserting similar claims arising during the same period. Like the class action lawsuit from October 2020 filed in the U.S. Federal District Court for the Southern District of New York (which had court approval for settlement in August 2022), the Australian class actions relate to the Complete Response Letter released by the FDA in September 2020 in relation to the Company's GvHD product candidate; they also relate to certain representations made by the Company in relation to our COVID-19 product candidate and the decline in the market price of the Company's ordinary shares in December 2020. The Australian class actions have been consolidated into one lawsuit. The Company will continue to vigorously defend against the proceedings. The Company cannot provide any assurance as to the possible outcome or cost to us from the lawsuit, particularly as it is at an early stage, nor how long it may take to resolve such lawsuit. Thus, the Company has not accrued any amounts in connection with such legal proceedings.

Loss before income tax - Summary of Loss Before Income Tax (Parenthetical) (Details) - USD ($)	6 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Disclosure Of Loss Before Income Tax Line Item
Equity settled share-based payment transactions	$ 2,195,000	$ 1,757,000
Income Statement Functional Expense Categories
Disclosure Of Loss Before Income Tax Line Item
Equity settled share-based payment transactions	2,195,436	1,756,898
Income Statement Functional Expense Categories \| Research and development
Disclosure Of Loss Before Income Tax Line Item
Equity settled share-based payment transactions	1,104,007	797,058
Income Statement Functional Expense Categories \| Manufacturing and commercialization
Disclosure Of Loss Before Income Tax Line Item
Equity settled share-based payment transactions	48,064	(183,720)
Income Statement Functional Expense Categories \| Management and administration
Disclosure Of Loss Before Income Tax Line Item
Equity settled share-based payment transactions	$ 1,043,365	$ 1,143,560