News Release

NEWARK, Calif., Feb. 2, 2012 (GLOBE NEWSWIRE) -- StemCells, Inc. (Nasdaq:STEM) today announced that the U.S. Food and Drug Administration (FDA) has authorized the initiation of a Phase I/II clinical trial of the Company's proprietary HuCNS-SC® product candidate (purified human neural stem cells) in dry age-related macular degeneration (AMD), the most common form of AMD.   AMD is the leading cause of vision loss and blindness in people over 55 years of age, and approximately 30 million people worldwide are afflicted with the disease. There are no approved treatments for dry AMD.

"With the approval of this trial, we have accomplished something truly unique in the stem cell field, which is the extension of clinical testing of our proprietary human neural stem cell platform to all three elements of the central nervous system: the brain, spinal cord and eye," said Martin McGlynn, President and CEO of StemCells, Inc. "The preclinical data supporting our IND is particularly compelling and we look forward to getting this trial underway."

The Phase I/II trial will evaluate the safety and preliminary efficacy of HuCNS-SC cells as a treatment for dry AMD. The trial will be an open-label, dose-escalation study, and is expected to enroll a total of 16 patients. The HuCNS-SC cells will be administered by a single injection into the space beneath the retina. Patients' vision will be evaluated using conventional methods of ophthalmological assessment at predetermined intervals over a one-year period. Patients will then be followed for an additional four years in a separate observational study. 

Preclinical data submitted as part of the Company's Investigative New Drug application demonstrated that HuCNS-SC cells protect host photoreceptors and preserve vision in a well-established animal model of retinal disease that is relevant to dry AMD. HuCNS-SC transplants significantly protect against the degeneration of photoreceptors, the key cells of the eye involved in vision.  Moreover, the number of cone photoreceptors, which are responsible for central vision, remain constant over an extended period, consistent with the sustained visual acuity and light sensitivity observed.  In humans, degeneration of the cone photoreceptors account for the unique pattern of visual loss in dry AMD.  A summary of the Company's preclinical data was published in the February issue of the international peer-reviewed European Journal of Neuroscience, and is available online at http://onlinelibrary.wiley.com/doi/10.1111/j.1460-9568.2011.07970.x/abstract.

"We have published the preclinical evidence demonstrating that our human neural stem cells might offer a safe, effective and simple approach to treating AMD and other retinal diseases," said Stephen Huhn, MD, FACS, FAAP, Vice President and Head of the CNS Program at StemCells, Inc. "Our approach is to provide durable protection of photoreceptors, thereby preserving vision, as opposed to approaches that aim to replace photoreceptors or the retinal pigmented epithelial cells. Furthermore, our preclinical data supports our hypothesis that we can achieve clinical benefit with a single transplant in AMD patients."

About StemCells, Inc.

StemCells, Inc. is engaged in the research, development, and commercialization of cell-based therapeutics and tools for use in stem cell-based research and drug discovery. The Company's lead therapeutic product candidate, HuCNS-SC® cells (purified human neural stem cells), is currently in development as a potential treatment for a broad range of central nervous system disorders. Clinical trials are currently underway in spinal cord injury and in Pelizaeus-Merzbacher disease (PMD), a fatal myelination disorder in children, and the Company expects to initiate a Phase I/II clinical trial in dry AMD in the near future.  In addition, the Company is pursuing preclinical studies of its HuCNS-SC cells in Alzheimer's disease. StemCells also markets stem cell research products, including media and reagents, under the SC Proven® brand, and is developing stem cell-based assay platforms for use in pharmaceutical research, drug discovery and drug development. Further information about StemCells is available at http://www.stemcellsinc.com.  

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Apart from statements of historical fact, the text of this press release constitutes forward-looking statements within the meaning of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended, and is subject to the safe harbors created therein. These statements include, but are not limited to, statements regarding the prospect of the Company's HuCNS-SC cells to preserve vision in animal models of retinal disease; the potential of the Company's HuCNS-SC cells to treat a broad range of central nervous system disorders; the prospect and timing associated with initiating a clinical trial in a retinal disorder; and the future business operations of the Company, including its ability to conduct clinical trials as well as its other research and product development efforts. These forward-looking statements speak only as of the date of this news release. The Company does not undertake to update any of these forward-looking statements to reflect events or circumstances that occur after the date hereof. Such statements reflect management's current views and are based on certain assumptions that may or may not ultimately prove valid. The Company's actual results may vary materially from those contemplated in such forward-looking statements due to risks and uncertainties to which the Company is subject, including the fact that additional trials will be required to demonstrate the safety and efficacy of the Company's HuCNS-SC cells for the treatment of any disease or disorder; uncertainty as to whether the results of the Company's preclinical studies in retinal disease will be replicated in humans; uncertainty as to whether the FDA or other applicable regulatory agencies or review boards will permit the Company to continue clinical testing in spinal cord injury, PMD, AMD, or in future clinical trials of proposed therapies for other diseases or conditions given the novel and unproven nature of the Company's technologies; uncertainties regarding the timing and duration of any clinical trials; uncertainties regarding the Company's ability to recruit the patients required to conduct its clinical trials or to obtain meaningful results; uncertainties regarding the Company's ability to obtain the increased capital resources needed to continue its current and planned research and development operations; uncertainty as to whether HuCNS-SC cells and any products that may be generated in the future in the Company's cell-based programs will prove safe and clinically effective and not cause tumors or other adverse side effects; uncertainties regarding the Company's ability to commercialize a therapeutic product and its ability to successfully compete with other products on the market; and other factors that are described under the heading "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2010, and in its subsequent reports on Forms 10-Q and 8-K.

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