Mesoblast Limited

Hello everyone and welcome to the Mesoblast financial results for the period ended September 30th, 2022. An announcement and presentation have been lodged with the ASX and will also be available on the home and investor pages at www.mesoblast.com. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session and instructions will follow at that time. As a reminder, this conference call is being recorded. Before we begin, let me remind you that during today's conference call, the company will be making forward-looking statements that represent the company's intentions, expectations, or beliefs concerning future events. These forward-looking statements are qualified by important factors set forth in today's announcement. and the company's filings with the SEC, which could cause actual results to differ materially from those and such forward-looking statements. In addition, any forward-looking statements represent the company's views only as of the date of this webcast and should not be relied upon as representing the company's views of any subsequent date. The company specifically disclaims any obligations to update such statements. With that, I would now like to turn the floor over to Dr. Silvio Etescu, Chief Executive of Mesoblast. Please go ahead.

Good morning, good afternoon to the operational highlights and financial results for the quarter ended September 30th, 2022, as well as our upcoming annual general meeting. Apologies for the slight delay due to technical difficulties beyond our control. Joining me here Today is Dr. Eric Rose, our chief medical officer, and Andrew Schapanel, our interim chief financial officer. If we could go to the first slide. If we could go to slide number four, please. Survival outcomes have not improved over the past two decades for children or adults with the most severe forms of steroid refractory acute graft-versus-host disease. In particular, the lack of any approved treatments for children under 12 means that there's an urgent need for a therapy that improves the dismal survival outcomes in children. In light of the unmet need, Remy Stem Cell L has been granted fast-track designation and VLA priority review from the FDA. A major milestone in the company's complete response to the FDA was our submission at the end of the last quarter of substantial new information on clinical and potency assay items to the IND file for remy stem cell in the treatment of children with serodrefractory acute GVHD, as has been guided by the FDA. Misoblast has optimized the potency assay that was in place at the time of the Phase III trial, and which demonstrates a relationship between the product's activity in vitro and its effects on survival in the Phase III trial. Additionally, Misoblast has now generated data from the Expanded Access Program, EAP275, in 241 children, which confirmed the ability of the in vitro potency assay to measure product activity relevant to survival outcomes. Next slide, please. Today, Mesoblast provided new results from a four-year observational survival study performed by the Center for International Blood and Marrow Transplant Research, CIBMTR, on 51 evaluable patients with steroid refractory acute GVHD who were enrolled in mesoblast phase three clinical trial of remy stem cell L. Overall survival in the remy stem cell cohort was 63% at one year, 51% at two years, and 49% at four years. Across four recently published studies of children or adults with steroid refractory acute GVHD, one year survival of just 40 to 49% and two-year survival of just 25 to 38% was seen after best available therapy or the only FDA-approved agent for adults, ruxolitinib. The new long-term survival data provide assurance that the short-term day 28 responses and early survival through 180 days in the 54-patient phase three trial in children with acute GVHD previously presented to the FDA in the original BLA submission are unlikely to have arisen by chance. These long-term survival outcomes are a cornerstone of the VLA resubmission. Next slide, please. This slide is a snapshot of our late-stage clinical pipeline. As you can see, we have two platform technologies. In red is our lead technology platform, Remy Stem Cell L, and in blue is our second-generation technology platform, Rex Lemy Stroh Cell. using immunoselection to isolate stromal cells. Our Remy Stem Cell platform is more advanced, and our lead product is currently in the approval phase for acute graft-versus-host disease in children. I will be talking more about this product shortly, as well as updating on RexLemiStroCell for chronic low back pain and chronic heart failure from reduced ejection fraction, both conditions due to severe inflammation. Now we move to the financial results for the quarter for the period ended September 30th, 2022. Andrew, over to you please.

Thanks, Sylvie. Now turning to slide eight, we have the financial highlights for the quarter. As at September 30th, 2022, cash on hand was $85 million, up to a Up to an additional $40 million may be drawn from existing financing facilities subject to certain milestones, with current discussions to extend the period for the drawdown option. Net cash usage for operating activities in the quarter was $14.3 million. This represented a 22% reduction of $3.9 million on the comparative quarter in FY2022. and a 47% reduction of $12.5 million on the comparative quarter in FY 2021. Revenue from royalty on sales of Temcel in Japan for the quarter were $1.4 million and $1.8 million on a constant currency basis. For the 12-month period ended September 30th, 2022, royalties were $7.7 million and on a constant currency basis, $9 million, which was a 9% increase on the comparative period. Turning to the next slide, which is slide nine, please, we can see the P&L result for the three months ended September 30th. Within revenue, the majority of the change was due to one-off licensing milestone in the prior period and the impact of currency movements. There is a reduction in expenditure for R&D, manufacturing and management administration, totalling a decrease of 23% or $5.2 million for the period ended September 30, 2022 on the comparative quarter. During the quarter, we continued pre-launch manufacturing activities and product testing for Remy Stem Cell. to support the potential commercial launch. On FDA approval, Remy stem cell inventory will be recognised on the balance sheet, currently valued at $28 million. Within finance costs, we include actual cash interest paid of $1.2 million for the quarter ended September 30, 2021, and also quarter ended 2022. The increase in our reported finance costs was primarily due to the recognition of a non-cash gain on revaluation of our borrowings in the comparative year. And turning to the last finance slide, slide 10, this slide highlights our reduction in burn, which has reduced 33% or $30 million on a rolling 12-month basis. Now I'd like to turn the call back to Sylvia.