Re the results of our Phase 2/3 Covid /ARDS trial there is one...

Re the results of our Phase 2/3 Covid /ARDS trial there is one important factor that has not been commented on thus far. Silviu mentions in the latest Edison webcast how patients in the ICU, arrive normally days after their first symptoms ...and the vast majority are no longer put on ventilation within 24/48 hours . Instead high flow oxygen devices are preferred under new treatment protocols..with intubation a last resort. As our enrolment criteria explicitly require all patients must be ventilated to receive our treatment, this means that we are receiving our patients at a much later stage in disease progression in the last enrolled segment.

So why is this a problem for Mesoblast ? Well the toll like receptors on mesenchymal cells react to the level of inflammation in vivo. So when the level of CRP is highly elevated it stimulates a larger proportional response from our cells. The graphs shown below in Figure 3 of the link, illustrates that CRP peaks in most patients of “progressive” ARDS ...within the first week. Then as the bodies immune defences are overwhelmed, often accompanied by multiple organ failure and fibrosis... the level of CRP subsides...which would suggest a correspondingly lower level of activation from the TLR receptors on our cells.

In other words, our cells have thegreatesteffect when CRP ispeaking and our results will show less efficacy when treatment is delayed.

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7598305/figure/fig3/?report=objectonly

Mesoblast has a dilemma. In the words of one salty broker i know, “they went looking for India and discovered America”. To translate, the primary endpoints were off course.... but what is now proven by the phase 3data is a much bigger commercial market opportunity than anyone could have imagined 12 months ago....

By not meeting primary endpoints in ARDS and CHF we will have to wait for confirmation from Novartis and Grunenthal of their intentions to continue with confirmatory trials ...which have follow on implications for cash milestone payments.

If one accepts Silviu’s upbeat assessment,that there are genuine prospects of an accelerated approval for both srGVHD and CHF then the shares are outrageously cheap in my view ...however, the market is obviously waiting for more tangible proof....after the Ryoncil debacle with the “current team” at CEBR. I think it is a case of once bitten twice shy. Encouragingly Silviu has confirmed that cash burn will be considerably reduced over historic levels during the next twelve months because there are much lower clinical trial commitments. The balance sheet needs strengthening so what does Silviu have up his sleeve ? In typical Mesoblast tradition, the shareholders will have to climb a wall of fear as the fundraising clock runs down , ahead, of what must surely be, the signing of a transformational CHF partnership...and positive ARDS data.

Whatever is ahead of us... I can promise you one thing. It will not be boring !

Please do not rely on the facts or opinions expressed in the above post when making an investment decision OP

P.S. all the graphs referenced have been removed so you will have to look at figure 3 of the link to make sense of my post