Slide 1: Capital Raising Presentation
For personal use only Capital Raising Presentation 1 for 12 Accelerated Non-Renounceable Entitlement Offer 25 August 2017 ASX:MSB/ Nasdaq:MESO Not for distribution or release in the United States
Slide 2: Important Notice and Disclaimer
Important Notice and Disclaimer For personal use only NOT FOR RELEASE OR DISTRIBUTION IN THE UNITED STATES OF AMERICA This presentation has been prepared by Mesoblast Limited (ACN 68 109 431 870) (Mesoblast) in relation to an accelerated non-renounceable pro-rata entitlement offer (Entitlement Offer
Slide 3: Important Notice and Disclaimer (continued)
This Presentation has been prepared for publication in Australia and may not be released or distributed in the United States. In particular, this Presentation does not constitute an offer to sell, or a For personal use only solicitation of an offer to buy, securities in the United States. The New Sh
Slide 4: Important Notice and Disclaimer (continued)
Mesoblast, its advisers and their respective related bodies corporate, affiliates, directors, employees or agents assume no responsibility for the accuracy of such information. Any For personal use only market and industry data used in connection with this Presentation was obtained from research, surv
Slide 5: Details of the Entitlement Offer
Details of the Entitlement Offer For personal use only Offer structure and size • Fully underwritten 1 for 12 pro-rata accelerated non-renounceable Entitlement Offer to raise approximately A$50.7 million before costs • Approximately 36.2 million New Shares to be issued (equivalent to 8.3% of current
Slide 6: Financials and Use of Proceeds
Financials and Use of Proceeds As at March 31, 2017 the Company had cash reserves of US$69.1 million For personal use only As at June 30, 2017 the Company had cash reserves of US$45.8 million Q4 FY2017 net cash burn of US$23.3 million was primarily used for: • Funding the costs of on-going Tie
Slide 7: Pro forma Balance Sheet
Pro forma Balance Sheet US$m 31 March 2017(1) 31 March 2017(2) For personal use only (unaudited) Pro forma Cash and cash equivalents 69.1 107.3 Other assets 610.1 610.1 Total Assets 679.2 717.3 Current liabilities 29.7 29.7 Non-current liabilities 109.1 109.1 Total Liabilities 138.8 138.8 Issued Cap
Slide 8: Entitlement Offer Timetable
Entitlement Offer Timetable Event Date For personal use only Trading halt and announcement of the Entitlement Offer Friday, 25 August 2017 Institutional Entitlement Offer opens Friday, 25 August 2017 Institutional Entitlement Offer closes Monday, 28 August 2017 Trading halt lifted and Mesoblast shar
Slide 9: Our Mission
For personal use only Our Mission: Mesoblast is committed to bring to market disruptive cellular medicines to treat serious and life-threatening illnesses Not for distribution or release in the United States |9
Slide 10: Investment Proposition: Building a Leading Franchise of Cellular Medicines
Investment Proposition: Building a Leading Franchise of Cellular Medicines For personal use only A Leader in Disruptive Capability for Commercial Advanced Pipeline of Cellular Technology Translation Cellular Medicines Platform Extensive patent portfolio Scalable industrialized Three Tier 1 pro
Slide 11: The 21st Century Cures Act: Expedited Approval Path (RMAT)
The 21st Century Cures Act (“Cures Act”): Legislation for An Expedited Approval Path for Cellular Medicines Designated as For personal use only Regenerative Medicine Advanced Therapies (RMAT) Cellular medicines may be designated as regenerative advanced therapies, if they are intended to treat, mo
Slide 12: Proprietary Mesenchymal Lineage Technology Platform
For personal use only Proprietary Mesenchymal Lineage Technology Platform Not for distribution or release in the United States | 12
Slide 13: Intellectual Property: An Extensive Portfolio
Intellectual Property: An Extensive Portfolio Covering Composition of Matter, Manufacturing, and Therapeutic For personal use only Applications of Potent Immuno-selected Mesenchymal Lineage Precursors and Progeny ~ 800 Patents and patent applications across 69 Patent Families. Protection across majo
Slide 14: Translating Our Science to the Clinic
Translating Our Science to the Clinic For personal use only Mesenchymal lineage immuno-selected precursors and Mesenchymal progeny cells (MLCs) Lineage Cells (MLCs) STRO-1/STRO-3 immuno-selection provides a Cytokines homogeneous and potent population of MLCs with receptors Chemokines Reduced Inf
Slide 15: Technology Positioned for Scalable Manufacturing Capability
The Mesoblast Difference: Technology Positioned for Scalable Manufacturing Capability For personal use only Manufacture completed for clinical supply of all current Phase 3 trials Regulatory activities ongoing to meet requirements for commercial manufacturing across product pipeline Specific f
Slide 16: Diverse Pipeline of Cellular Medicines
For personal use only Diverse Pipeline of Cellular Medicines Not for distribution or release in the United States | 16
Slide 17: Portfolio of Advanced Product Candidates
Portfolio of Advanced Product Candidates: Well Positioned for the 21st Century Cures Act Environment For personal use only Commercialization Product Therapeutic Area Pre-Clinical/ Platform Candidate Pre-IND Phase 2 Phase 3 Approval Partnering1 Advanced (Class 3) HF MPC MPC-150-IM End Stage (Class 4)
Slide 18: MPC-150-IM Chronic Heart Failure Program
For personal use only MPC-150-IM Chronic Heart Failure (CHF) Program | 18 Not for distribution or release in the United States | 18
Slide 19: MPC-150-IM: Targeting Patients with Worsening HF
MPC-150-IM: Targeting Patients with Worsening HF Despite Optimal Standard of Care For personal use only Under Investigation in Phase 2b/3 MPC-150-IM targets MPC-150-IM targets HFrEF NYHA class IIB/III HFrEF NYHA class III/IV patients with worsening patients with worsening HF despite optimal care HF
Slide 20: MPC-150-IM: Serious and Life-Threatening Complications of Heart Failure
MPC-150-IM: Targets the Serious and Life-Threatening Complications of Heart Failure For personal use only Burden of Illness and Unmet Need Globally, 17-45% of heart failure patients die within 1 year of hospital admission Majority die within 5 years of admission1 MPC-150-IM to target advanced
Slide 21: MPC-150-IM: Phase 2 Randomized Placebo Controlled Trial
MPC-150-IM: Phase 2 Randomized Placebo Controlled Trial in 60 Patients HF Class II/III and LVEF<40% For personal use only Objectives LVESV Month 6 - Baseline LVEDV Month 6 - Baseline • Identify a dose response and an optimal therapeutic dose • Identify optimal target population for therapeutic effec
Slide 22: MPC-150-IM: Therapeutic Benefit on LV Remodeling
MPC-150-IM: Therapeutic Benefit on LV Remodeling Enhanced in Phase 2 Subjects with LVESV >100ml For personal use only • Placebo corrected benefit of 150M cell dose on cardiac volumes and ejection fraction at 6 months was greatest in patients with more advanced heart failure as defined by ∆ ∆ baselin
Slide 23: MPC-150-IM: Durable 36-Month Protection Against HF-MACE
MPC-150-IM: Durable (36 Months) Protection Against HF-MACE1 in Phase 2 Trial Following Single Dose For personal use only % HF-MACE Kaplan-Meier Curve over HF-MACE Kaplan-Meier Curve over 36 months following 36 months following treatment in all patients1 treatment in patients with LVESV>100ml2 • Over
Slide 24: MPC-150-IM: Phase 3 Trial Targets Advanced Heart Failure
MPC-150-IM: Phase 3 Trial Targets Advanced Heart Failure For personal use only NYHA class II/III patients with large baseline LVESV and advanced heart failure are at highest risk of heart failure-related major adverse cardiac events (HF-MACE) • Have increased likelihood of having recurrent HF hospit
Slide 25: MPC-150-IM: Operational Update for Phase 3 Trial
MPC-150-IM: Operational Update for Phase 3 Trial in NYHA Class II-III Advanced CHF Patients For personal use only • Trial is planned to enroll approximately 600 patients • In April 2017, a pre-specified interim futility analysis of the efficacy endpoint in the Phase 3 trial's first 270 patients was
Slide 26: MPC-150-IM: Adjunct to LVAD in NYHA Class IV Heart Failure
MPC-150-IM: Adjunct to LVAD in NYHA Class IV/End Stage Heart Failure Commercial Landscape For personal use only Burden of Illness and Unmet Need 250K – 300K patients suffer from advanced systolic HF (NYHA Class IV)1 Despite optimal medical therapy, 1-year mortality exceeds 50% in class IV patien
Slide 27: MPC-150-IM: Destination Therapy and Bridge to Recovery
MPC-150-IM: Targets Destination Therapy and Potential Use for Bridge to Recovery For personal use only Three Distinct Market Segments Destination Therapy Represents ~45% of Market3 Bridge to Resucue Recovery Therapy 0.3% 0.4% • Bridge to transplant (BTT) appears saturated with ~2k transplants per an
Slide 28: Bleeding is the Major Complication of Continuous Flow LVADs
MPC-150-IM: Bleeding is the Major Complication of Continuous Flow (CF) LVADs For personal use only The most common cause of LVAD-related re-hospitalization, not associated with surgical procedures, is gastrointestinal (GI) bleeding Adverse Event Rates (Events per 100 Patient-Months) in the First 12
Slide 29: Rationale for Use as Adjunct Therapy in LVAD Patients
MPC-150-IM: Rationale for Use as Adjunct Therapy in LVAD Patients For personal use only We believe MPC-150-IM has the potential to: • reduce GI bleeding and associated hospitalizations due to arterio-venous malformations in the gut by secreting pro-arteriogenic factors necessary for blood vessel mat
Slide 30: Blood Vessel Formation as Key Component of MPC Mechanism of Action
Blood Vessel Formation (Arteriogenesis and Angiogenesis) as a Key Component of the MPC Mechanism of Action in Chronic Heart Failure For personal use only MPCs have a beneficial effect on endothelial function through MPC production and release of Ang-1 This secreted glycoprotein reduces Ang-2 lev
Slide 31: LVAD MPC Pilot Trial: Evaluating 25M MPCs as Adjunct to LVAD
LVAD MPC Pilot Trial: Evaluating 25M MPCs as Adjunct to LVAD1-3 For personal use only Assessed for eligibility (N=81) 57.4 yrs (±13.6) Excluded (n=51) 83% Male Randomized (n=30) LVEF 18.1% (± 4.3) 37% Ischemic, 63% Non-ischemic MPC (n=20) Control (n=10) 67% DT indication, 33% BTT indicatio
Slide 32: LVAD MPC Pilot Trial: Weaning and Short-Term Survival
LVAD MPC Pilot Trial: 25M MPCs Increased Ability to be Weaned off LVADs and For personal use only Increased Short-Term Survival1 No cell-related safety events observed LVAD MPC Pilot Trial: 12 Month Survival Median time to first readmission was 91 days in the MPC group vs 51 days in the control
Slide 33: MPC-150-IM: Operational Update for Phase 2b LVAD Trial
MPC-150-IM: Operational Update for Phase 2b Trial Evaluating 150M MPCs in End-Stage Heart Failure Patients as Adjunct to LVAD For personal use only Study is sponsored and funded by the United States National Institutes of Health (NIH), and conducted by the NIH-funded Cardiothoracic Surgical Trials
Slide 34: Chronic Low Back Pain (CLBP) Due to Disc Degeneration
For personal use only Chronic Low Back Pain (CLBP) Due to Disc Degeneration | 34 Not for distribution or release in the United States | 34
Slide 35: MPC-06-ID: Potential Alternative to Invasive Surgery and Opioid Use
MPC-06-ID: Potential Alternative to Invasive Surgery and Opioid Use for Chronic Low Back Pain Patients For personal use only Burden of Illness and Unmet Need Back pain causes more disability than any other condition1 Inflicts substantial direct and indirect costs on the healthcare system1, inclu
Slide 36: MPC-06-ID: Phase 2 Trial Results Support Phase 3 Program
MPC-06-ID: Phase 2 Trial Results Support Phase 3 Program For personal use only 100 patients with >6 months of CLBP due to DDD and unresponsive to conservative therapies (incl. opioids and epidural steroids) were evaluated in a blinded, randomized, placebo controlled Phase 2 trial Composite Respond
Slide 37: MPC-06-ID: Durable 36-Month Outcomes in Phase 2
MPC-06-ID: Durable 36-Month Outcomes in Phase 2 For personal use only Using the Intent to Treat (ITT) analysis, in line with FDA guidance for the ongoing Phase 3 trial, similar results were seen for the primary endpoint composite over 24 months, with 38% of the 6 million MPC group achieving this o
Slide 38: MPC-06-ID: Phase 3 Trial Update
MPC-06-ID: Phase 3 Trial Update For personal use only A 360-patient Phase 3 trial across US and Australian sites Targeted to complete recruitment by Q4 2017 FDA has provided written guidance: - Use of a composite primary endpoint is acceptable for potential approval - Agreed thresholds for pai
Slide 39: Our Inflammatory Diseases Portfolio (MPC-300-IV)
For personal use only Our inflammatory diseases portfolio (MPC-300-IV) Not for distribution or release in the United States | 39
Slide 40: MPC-300-IV: Biological Refractory Rheumatoid Arthritis
MPC-300-IV: Biological Refractory Rheumatoid Arthritis (RA) Market Landscape For personal use only Market Size There are approx 6.0 million prevalent cases in the US, Japan, and EU5, with 2.9 million in the US alone in 20161,2 In 2016, sales of RA agents, predominantly TNF inhibitors exceeded $1
Slide 41: MPC-300-IV: Phase 2 Study Design
MPC-300-IV: Phase 2 Study Design For personal use only Phase 2 double-blind, randomized, placebo-controlled, dose-escalating study comparing a single infusion of two MPC doses (1M/kg and 2M/kg) with placebo in patients with active RA – Inadequate response to at least 1 anti-TNF +/- otherbiologics
Slide 42: MPC-300-IV: Phase 2 Trial 39-Week Results
MPC-300-IV: Phase 2 Trial 39-Week Results For personal use only The safety profile over 39 weeks was comparable among the placebo and both MPC treatment groups, with no cell-related serious adverse events Both MPC doses outperformed placebo at week 39 in each of ACR20/50/70 responses, as well as
Slide 43: Summary of Key Efficacy Responses: All Subjects
Summary of Key Efficacy Responses at 3 and 9 Months: All Subjects For personal use only Week 12 Week 39 Placebo 1M/kg 2M/kg Placebo 1M/kg 2M/kg N=16 N=16 N=16 N=16 N=16 N=16 ACR20 50% 47% 53% 36% 69% 57% ACR50 19% 27% 40% 14% 31% 21% ACR70 0% 20% 27%* 0% 23% 21% ACR-N median 20% 11% 28% 9% 27% 27% A
Slide 44: Summary of Key Efficacy Responses: Prior Use of 1-2 Biologics
Summary of Key Efficacy Responses at 3 and 9 Months: Sub-group with Prior Use of 1-2 Biologics For personal use only Week 12 Week 39 Placebo 1M/kg 2M/kg Placebo 1M/kg 2M/kg N=9 N=10 N=11 N=9 N=10 N=11 ACR20 33% 60% 55% 22% 67% 60% ACR50 11% 30% 55% 0% 33% 30% ACR70 0% 20% 36% 0% 22% 30% ACR-N median
Slide 45: Acute Graft vs Host Disease (aGVHD)
For personal use only Acute Graft vs Host Disease (aGVHD) MSC-100-IV for steroid-refractory aGVHD Not for distribution or release in the United States | 45
Slide 46: MSC-100-IV: Acute Graft vs Host Disease
MSC-100-IV: Acute Graft vs Host Disease (aGVHD) Serious and Life-Threatening Complication of Bone Marrow Transplants For personal use only Burden of Illness and Unmet Need aGVHD - a severe immunological reaction occurring in BMT patients Steroid-refractory aGVHD (SR-aGVHD) patients have mortalit
Slide 47: MSC-100-IV: Prior Clinical Results Support Ongoing Phase 3 Trial
MSC-100-IV: Prior Clinical Results1 Support Ongoing Phase 3 Trial in Children with Steroid For personal use only Refractory Acute GVHD (SR-aGVHD) MSC-100-IV in Children with SR-aGVHD MSC-100-IV as first line therapy who failed multiple other modalities in children with SR-aGVHD - Survival of Pediatr
Slide 48: MSC-100-IV for aGVHD: Product Development Strategy
MSC-100-IV for aGVHD: Product Development Strategy For personal use only Pediatric aGVHD Multi-center, single-arm, open-label, ongoing Phase 3 study in up to 60 pediatric patients with steroid- refractory aGVHD The pre-specified interim futility analysis of the trial’s primary endpoint was succe
Slide 49: Corporate Development: Partnership Negotiations Underway
Corporate Development: Advanced Negotiations for a Development and Commercialization Partnership Underway For personal use only December 22, 2016 - Entered into an equity Mallinckrodt Pharmaceuticals purchase agreement with Mallinckrodt − Gains a significant opportunity to get access to a Pharma
Slide 50: Targeted Upcoming Milestones and Catalysts
Targeted Upcoming Milestones and Catalysts For personal use only MPC-150-IM − Phase 3 trial for Class II/III continues to enroll with target expected completion (2H CY18) − Phase 2B trial expected to complete enrollment (3Q CY17) for Class IV1,2 − Phase 2B data read-out Class IV (expected 1Q CY18)
Slide 51: Key Risks (1 of 5)
Key Risks (1 of 5) For personal use only Mesoblast’s business is subject to a number of risk factors both specific to its business and of a general nature which may impact its future performance and forecasts and the value of its securities. Many of the circumstances giving rise to these risks are b
Slide 52: Key Risks (2 of 5)
Key Risks (2 of 5) For personal use only The speed and quality of the Company’s clinical trial execution are primary drivers of its ability to transform into a commercial stage company. In addition, the future profitability of the Company’s products depends largely on the reasonable achievement of v
Slide 53: Key Risks (3 of 5)
Key Risks (3 of 5) For personal use only Execution of the Company's corporate strategy could be impacted if the Company did not retain its present CEO and certain members of staff. If the Company fails to attract and keep senior management and key scientific personnel, it may be unable to successful
Slide 54: Key Risks (4 of 5)
Key Risks (4 of 5) Eligible shareholders that do not take up all or part of their entitlements will be diluted by not participating to the full extent in the Entitlement Offer and will not be ENTITLEMENT OFFER For personal use only exposed to future increases or decreases in Mesoblast’s share price
Slide 55: Key Risks (5 of 5)
Key Risks (5 of 5) The price of Shares quoted on the ASX may rise or fall, and the Shares may trade below or above the exercise price due to a number of factors, including: For personal use only (i) general economic conditions, including interest rates, exchange rates, inflation rates and commodity
Slide 56: International Offer Restrictions (1 of 3)
International Offer Restrictions (1 of 3) This document does not constitute an offer of new ordinary shares ("New Shares") of the Company in any jurisdiction in which it would be unlawful. In particular, this document may not be distributed to any person, and the New Shares For personal use only may
Slide 57: International Offer Restrictions (2 of 3)
International Offer Restrictions (2 of 3) Luxembourg For personal use only The information in this document has been prepared on the basis that all offers of New Shares will be made pursuant to an exemption under the Directive 2003/71/EC ("Prospectus Directive"), as amended and implemented in Luxemb
Slide 58: International Offer Restrictions (3 of 3)
International Offer Restrictions (3 of 3) Switzerland For personal use only The New Shares may not be publicly offered in Switzerland and will not be listed on the SIX Swiss Exchange ("SIX") or on any other stock exchange or regulated trading facility in Switzerland. This document has been prepared