Award to Fund IND-Enabling Activities for the Company's HuCNS-SC(R) Neural Stem Cells in Cervical Spinal Cord Injury

Decision on Funding Alzheimer's Program Deferred to CIRM's September Board Meeting

NEWARK, Calif., July 26, 2012 (GLOBE NEWSWIRE) -- StemCells, Inc. (STEM) today announced that the California Institute for Regenerative Medicine (CIRM) has approved an award to the Company and its collaborators for up to $20 million under CIRM's Disease Team Therapy Development Award program (RFA 10-05). The award is to fund preclinical development of StemCells' proprietary HuCNS-SC(R) product candidate (purified human neural stem cells) as a potential treatment for cervical spinal cord injury. The award will provide funding over a maximum four-year period, with the goal of filing an investigational new drug (IND) application to begin clinical testing in that time. CIRM deferred a decision on the Alzheimer's disease application submitted by StemCells and referred the application back to CIRM's Grants Working Group for further consideration. CIRM is expected to review the application again at the next meeting of its governing board currently scheduled for September 6th.

"We understand that this was a very competitive process and we are extremely grateful to CIRM for its support," commented Martin McGlynn, President and CEO of StemCells, Inc. "We view this decision by CIRM as a strong vote of confidence in our neural stem cell technology and the world class team of scientists and clinicians who will be collaborating to translate this exciting research into potential treatments and cures for patients with spinal cord injury. We are currently conducting a Phase I/II trial in thoracic spinal cord injury. This funding now allows us the opportunity to expand testing of our cells for cervical spinal cord injury, the most common form of spinal cord injury."

StemCells will evaluate its HuCNS-SC cells as a potential treatment for cervical spinal cord injury in collaboration with a team led by Aileen Anderson, Ph.D., Associate Professor in the Departments of Physical Medicine and Rehabilitation, and Anatomy and Neurobiology at University of California, Irvine. Dr. Anderson's laboratory has a long history of collaboration with StemCells in spinal cord injury, including the studies which led to the world's first clinical trial for a neural stem cell therapeutic in chronic spinal cord injury. This Phase I/II clinical trial, currently underway in Zurich, Switzerland, recently reported positive safety data from the first cohort of treated patients, and continues to enroll patients from Europe, the United States and Canada.

About Spinal Cord Injury

Spinal cord injury affects approximately 1.3 million people in the United States, for which there are no effective treatment options. Moreover, spinal cord injuries are a significant financial drain on the public health system. Cervical spinal cord injuries represent approximately half of all spinal cord injuries, for which lifetime healthcare costs range from $1.8 to $3.3 million per patient, depending upon severity of the injury.

About CIRM

CIRM was established in November 2004 with the passage of Proposition 71, the California Stem Cell Research and Cures Act. The statewide ballot measure, which provided $3 billion in funding for stem cell research at California universities and research institutions, was overwhelmingly approved by voters, and called for the establishment of an entity to make grants and provide loans for stem cell research, research facilities, and other vital research opportunities. A list of grants and loans awarded to date may be seen here: http://www.cirm.ca.gov/for-researchers/researchfunding.

The two applications submitted by StemCells, Inc. under CIRM's RFA 10-05 for cervical spinal cord injury and for Alzheimer's disease, as well as the feedback on each application from CIRMS's grants working group, can be viewed on the CIRM website at http://www.cirm.ca.gov/research-summaries-rfa-10-05-cirm-disease-team-therapy-development-awards.

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StemCells, Inc. Awarded $20 Million From the California Institute for Regenerative Medicine

Thirteen-year-old Ciaran Finn-Lynch, the teenager who made medical history in 2010 by having his throat rebuilt with his own stem cells, is making a successful recovery according to his doctors, BBC News reported.

Finn-Lynch, from Castleblayney in North Ireland,was hailed as the first child to undergo the novel tracheal transplant.

Born with a condition known as long-segment tracheal stenosis when more than two-thirds of the tracheas cartilage are misshapen and do not grow Finn-Lynch had a very difficult time breathing. He underwent the surgery in a desperate attempt to save his life, BBC News said.

Since undergoing the operation at Londons Great Ormond Street Hospital, Finn-Lynch has grown more than four inches and has returned to school, according to his doctors. Since the stem cells used to build the trachea were his own, he is able to live a normal life without having to take medication to prevent rejection of his transplant.

A follow-up report in the Lancet detailed the procedure and explained how the new organ had strengthened over the years.

The original procedure involved seeding stem cells taken from Finn-Lynchs bone marrow into a collagen skeleton of windpipe from a donor, BBC news reported. These stem cells formed a brand new trachea that was then implanted into his body, allowing its cells to grow and mature naturally.

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First ever child recipient of novel stem cell trachea 'doing well'

26 July 2012 Last updated at 01:35 ET

Doctors say a County Monaghan teenager who made medical history by using his own stem cells to rebuild his throat is making a successful recovery.

Ciaran Finn-Lynch, 13, from Castleblayney, made medical history as the first child in the world to undergo the pioneering tracheal transplant.

He was born with a condition called Long Segment Tracheal Stenosis which meant he found it difficult to breathe.

Doctors say he has grown 11 centimetres in height and returned to school.

The surgery was a desperate attempt to save his life after earlier treatment failed.

Since the operation, Ciaran has been able to live a normal life free from medication to prevent his immune system rejecting the transplant.

He underwent the procedure at London's Great Ormond Street Hospital in March 2010.

It involved seeding stem cells taken from Ciaran's bone marrow into the collagen "skeleton" of a donor windpipe stripped of its own cells.

Once the structure was implanted, the stem cells were allowed to mature in his body, rather than the usual laboratory "bioreactor".

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Boy's windpipe transplant success

By Jason Napodano, CFA

Last month we published a NOTE outlining the pioneering efforts of Neuralstem (NYSE MKT:CUR) in the use ofhuman neural stem cells ("hNSC") for the treatment of central nervous system diseases and neurodegenerative disorders.Neuralstems lead development program is for Amyotrophic Lateral Sclerosis (ALS), also known as Lou Gehrigs disease, named after the famous New York Yankee first baseman who was diagnosed with the disease in 1939, and passed in 1941 at the age of only 37.

The hippocampus is critically important to the control of memory and is severely impacted by the pathology of AD.Specifically, hippocampal synaptic density is reduced in AD and correlates with memory loss.Cam/Tet-DT mice mimic the substantial loss of hippocampal neurons that occur in advanced AD. StemCells Inc's data shows that one month after transplantation, HcCNS-SC engraft, migrate locally, and have begun to differentiate into neuronal and glial lineages in both models.

This resulted in observed increased synaptic density and improved memory post transplantation. Importantly, these results did not require reduction in beta amyloid or tau that accumulate in the brains of patients with AD and account for the pathological hallmarks of the disease, suggesting a new mechanism of action for the treatment of AD.

We think the data above presented by StemCells Inc. is interesting, and bodes well for Neuralstem's similar efforts focusing on hippocampal atrophy inneurodegenerativediseases. The different between StemCells Inc. and Neuralstem is that management at Neuralstem is attempting to recreate these highly encouraging results, only with a small molecule, NS-189, that the company discovered while testing preclinical candidates onstable neural stem cells lines derived from the human hippocampus.

A new hypothesis on major depressive disorder, implicates brain physiology ratherthan brain chemistry alone on disease progression. For example, research shows that depressed patients havereduced hippocampal volume. Accordingly, shrunken hippocampal volume observed in depressed patients could beattributable to a reduction in normal new neuronal generation and/or atrophying hippocampal neural stem cells.

The trial, which is designed to evaluate the safety and preliminary efficacy of BrainStorm's proprietary NurOwn cell therapy (bone marrow-derived, autologous, differentiated mesenchymal stromal cells) is being conducted at the Hadassah Medical Center in Jerusalem, Israel. The company submitted the positive interim safety report to the Israeli Ministry of Health. NurOwn has been granted Orphan-Drug designation by the U.S. FDA.

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CUR - Hope In Neurodegenerative Diseases

Liposuction may yield more than just a leaner figure it can potentially produce stem cells for tissue reconstruction.

Researchers from the University of Oklahoma, in Norman, Okla., have successfully extracted adult stem cells during liposuction and used them to generate healthy blood vessels.

These newly formed blood vessels can be used in heart bypass surgery and other complicated procedures requiring healthy vessels, according to the researchers, who presented their findings at the American Heart Associations Basic Cardiovascular Sciences 2012 Scientific Sessions.

While stem cells are typically derived from other sources in the body, the researchers said liposuction-derived stem cells could be useful for an elderly demographic.

For doing coronary artery bypass graft surgery, people who get that are typically elderly, frequently diabetic and usually pretty sick, Matthias Nollert, associate professor at the University of Oklahoma School of Chemical, Biological and Materials Engineering and the studys lead author, told FoxNews.com. The more typical way for getting stem cells from adults for transplantation is to extract cells from the bone marrow.

However, you cant extract bone marrow very easily, Nollert explained. Its a very invasive procedure and patients dont tolerate it well, so we were looking for alternate source of adult stem cells for older, sicker patients.

Extracting adipose-derived stem cells or stem cells derived from fat tissue would be less invasive and also gets rid of unnecessary body fat in the process. According to Nollert, creating tissues from fat stem cells is a fairly new science, having only been experimented with in the past decade. Nollert and his team are the first to create a vascular graft out of fat stem cells with muscle cells making up the blood vessels wall.

To create the vascular graft, the researchers turned the stem cells into smooth muscle cells in the lab and seeded them onto a thin collagen membrane. They then rolled them into tubes with the same diameter as small blood vessels, and three to four weeks later, usable blood vessels were formed.

According to Nollert, utilizing liposuction-derived blood vessels could eliminate complications surrounding heart bypass operations when a healthy blood vessel is necessary for the procedure.

In normal cases, [doctors] would take a vein from your leg or arm to use as a bypass around the blockage, Nollert said. Well it turns out that of allthe people who are considered candidates for bypass, a third of them would like to do a bypass graft, but they have lousy vessels. So theyll do a different procedure that will last only four to five years, and then theyll be back here with same problems.

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Fat stem cells from liposuction used to form functioning blood vessels