Mesoblast Ltd ( ASX:MSB , NASDAQ:MESO ) shares surged nearly 24% to $2.33 in afternoon trading after the cell therapy developer reported strong first-quarter revenue growth and a sharp reduction in operating cash spend.
The US-focused biotechnology group reported Ryoncil net revenue of US$28 million for the three months to September 30, up 44% on the corresponding period, as commercial momentum continued for its US-approved cell therapy.
Mesoblast also cut net operating cash spend by 86% to US$2.1 million from US$14.9 million a year earlier, while ending the quarter with about US$99 million in cash.
"Our first-quarter results show continued momentum for Ryoncil® (remestemcel-L-rknd) sales," chief executive Dr Silviu Itescu said.
"Importantly, we have shown substantial improvement in our net operating cash spend while continuing to advance our strategic objectives for rexlemestrocel-L in chronic pain and cardiovascular diseases."
Ryoncil commercial momentum builds
Ryoncil is the first US Food and Drug Administration-approved mesenchymal stromal cell therapy for steroid-refractory acute graft versus host disease in paediatric patients aged two months and older.
Mesoblast said September delivered the highest number of new patient starts in a month following expected seasonal softness during July and August.
The company is also working to expand Ryoncil into the adult market, with a registration trial now enrolling patients and as many as 40 US sites expected to be activated this year.
Those sites represent around 60% of the approximately 8,500 adult allogeneic bone marrow transplant patients treated annually in the US.
Clinical pipeline advances
Beyond Ryoncil, Mesoblast completed treatment of all 350 patients in its pivotal Phase 3 trial of rexlemestrocel-L for chronic inflammatory lower back pain caused by degenerative disc disease.
The trial's primary endpoint, measuring durable pain reduction at 12 months, is expected to read out next year.
Mesoblast also held a positive meeting with the FDA regarding a planned Biologics License Application for rexlemestrocel-L in patients with end-stage heart failure supported by a left ventricular assist device and suffering life-threatening gastrointestinal bleeding.
The FDA confirmed the application may proceed for that patient group, with formal meeting minutes expected shortly.
