Conference Call

Here's the important points from the conference call.
Its of interest because of the statements that the FDA wouldn't allow a further trial until a potency assay had been improved and also the words chosen and responses to Mr Hester (the analyst from Bell Potter) who has been bullish on recommending Mesoblast to clients over the years. Were there misunderstandings over what the FDA wanted and if so, where did that originate and how were they propagated? Was it deliberate or accidental? Why did Mesoblast not clarify the misunderstandings?

SI reading a prepared statement
-"The FDA acknowledged that improvements in the potency assay are in place"
-"90 day survival in the target population remains as low as 20-30%"
-"Mesoblast has generated data showing a survival benefit with Remestemcel in this target population
-"the FDA acknowledged in the recent review that changes implemented appear to have improved assay performance relative to the oroginal version potency assay used in the paediatric phase 3 trial"

Hester
In that letter (the original CRL) the FDA had required you to do Mesoblasts to do an additional study and it's my understanding and the market's understanding that an additional study had since been negotiated and was off the table so whats changed at the FDA that they now require this additional study?

SI
That's a very good question. We went through a dispute resolution process where the outcome of that was that the potency assays needed to be improved and on completion of the assay development work the paediatric data would be reconsidered in its totality. That was the whole basis of the resubmission.. The improvement in the potency assays has been acknowledged, the manufacturing process has been reviewed with no issues raised and we had fully anticipated that the additional clinical data including long term survival benefit would be sufficient to allow a sequenced approach to the market with the product being immediately made available to children who had nothing approved and who continued to have a very high mortality whilst we moved forward with an adult program. At all times we had planned to initiate around this time an adult program with the improved potency and with manufacturing being vetted effectvely. Infact the FDA had told us that we couldn't begin a further trial until we had those things signed off so the review process has allowed us to have both manufacturing through the inspection and the potency assays in alignment with the agency and we are now able to move into another trial but we had hoped of course that the paediatric population would have had the product made available earlier than the adult population.

Hester
Yeah well it just seems that the FDA keeps moving the goal posts here which is incredibly hard for you to let alone analysts to deal with I spose. But its frustrating. In terms of other stuff. Are you going to allow the expanded access program for paediatrics to continue in the US or do you plan on curtailing that?

SI
that remains an item to discuss with the agency when we meet with them over the next 45 days. We still want to see if we can get a product to children in a faster time frame than the completion of the adult trial. And I think those discussion will continue

Hester
Is that a piece of leverage that you have with the FDA?

SI
Lets see how those discussions go when we meet. But, you know, we would clearly like to make this product available as quickly as possible to children and that should not be impacted by the adult trial.