Recording a mono source into a stereo track records the information only on the left or right channel, depending on your input configuration.
What the panning does depends on the exact plugin. Usually, instead of panning they actually do stereo balancing, which means that it doesn’t actually move the sound between the left and right channels, but adjusts the volume of the channels. That is, setting it to either extreme sets the volume of that channel to 100% and the other channel to 0%.
In this case, as you’re using mono input 1, Cubase records by default on the left channel of the stereo track. As the right channel doesn’t contain any audio data and you’re not getting any audio output, this plugin probably uses stereo balancing instead of actual panning.