** Shares of biotech firm Mesoblast MSB.AX down 6.5% at A$2.245

** MSB falls as much as 7.1% earlier in the day, hitting its lowest since December 18, 2024

** First day of trading as a constituent of the S&P/ASX 200 benchmark index .AXJO, which is trading 0.7% lower as of 0223 GMT

** Arcadium Lithium ALTM.N, which is being acquired by Rio Tinto RIO.L, RIO.AX, removed from index at start of trading on March 6

** Melbourne-based MSB, which is developing medicines to treat life-threatening inflammatory conditions, top loser in the benchmark index

** MSB's Nasdaq-listed shares MESO.O closed 0.8% higher overnight after a cumulative 14.2% drop in the previous two sessions

** MSB reported HY loss of $47.9 million last week, compared with a $32.5 million loss a year earlier

** MSB shares down 28% this year, following a 10-fold surge last year

(Reporting by Sameer Manekar in Bengaluru)

((Sameer.Manekar@thomsonreuters.com;))