StemCells, Inc. Receives NIH Grant to Pursue Cell-Based Therapeutic for Hepatitis C

StemCells, Inc. Receives NIH Grant to Pursue Cell-Based Therapeutic for Hepatitis C

PALO ALTO, Calif.--(BUSINESS WIRE)--StemCells, Inc. (Nasdaq:STEM) announced today that it has been awarded a $305,000 grant from the National Institute of Diabetes and Digestive and Kidney Diseases to research and develop a potential cell-based therapeutic for liver disease arising from infection by the hepatitis C virus (HCV). Hepatitis C is a global health challenge, with approximately 170 million people affected worldwide and an estimated three million new infections each year. The virus targets liver cells and is a leading cause of end-stage liver disease.

The grant will fund work over the next year to investigate whether the Company's proprietary human liver engrafting cells (hLEC) can be made resistant to infection by the hepatitis C virus. The studies will be done in collaboration with Jeffrey Glenn, M.D., Ph.D, Associate Professor of Gastroenterology and Hepatology at Stanford University School of Medicine. Dr. Glenn is a recognized and widely published expert in hepatitis C, and his research has focused on designing novel antiviral strategies.

"By supporting this project, the NIH recognizes the potential for this novel cell-based approach to combat hepatitis C," said Dr. Maria Millan, M.D., F.A.C.S, Vice President and Head of the Liver Program at StemCells. "Current options to treat HCV are limited. Eventually, many patients need a liver transplant, and even those patients who successfully receive a transplant will ultimately suffer a recurrence of the infection. Transplanting liver cells that are resistant to HCV infection could address the dual challenges that underlie this intractable disease: to prevent infection and to restore lost function of a damaged liver."

This award is a Phase I grant under the Small Business Innovation Research (SBIR) Program of the National Institutes of Health. Should the objectives of the research funded by this grant be met, the Company anticipates applying for Phase II and additional funding under the SBIR Program.

About hLEC

StemCells, Inc.'s Liver Program is focused on identifying and developing human liver stem and progenitor cells as potential cell-based treatments for damaged or diseased livers. The human liver engrafting cells (hLEC) are a population of cells that are isolated from primary human tissue, engraft in vivo in animals and produce important human proteins that are missing or deficient in liver disease. Because the hLEC are prospectively isolated, they are a defined population of cells with more consistent biochemical and metabolic activity as compared to current hepatocyte preparations. Pre-clinical research findings indicate that the hLEC show promise as a cell-based therapy for the management and treatment of liver diseases.

About StemCells, Inc.

StemCells, Inc. is a clinical-stage biotechnology company focused on the discovery, development and commercialization of cell-based therapeutics to treat diseases of the central nervous system and liver. The Company's product development programs seek to repair or repopulate CNS and liver tissue that has been damaged or lost as a result of disease or injury. StemCells has pioneered the discovery and development of HuCNS-SC^® cells, its highly purified, expandable population of human neural stem cells. StemCells has completed enrollment and dosing of a six patient Phase I clinical trial of its proprietary HuCNS-SC product candidate as a treatment for neuronal ceroid lipofuscinosis (NCL) and expects the trial to be completed in early 2009. NCL, which is often referred to as Batten disease, is a rare and fatal neurodegenerative disease that affects infants and young children. StemCells owns or has exclusive rights to more than 50 issued or allowed U.S. patents and more than 150 granted or allowed non-U.S. patents. Further information about the Company is available on its web site at: www.stemcellsinc.com [1].

Apart from statements of historical fact, the text of this press release constitutes forward-looking statements regarding, among other things, the future business operations of StemCells, Inc. (the "Company") and its ability to conduct clinical trials as well as its 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 uncertainty as to whether the FDA or other applicable regulatory agencies will permit the Company to continue clinical testing in NCL or in future clinical trials of proposed therapies for other diseases or conditions despite the novel and unproven nature of the Company's technologies; uncertainties regarding the Company's ability to obtain the increased capital resources needed to continue its current research and development operations and to conduct the research, preclinical development and clinical trials necessary for regulatory approvals; uncertainty regarding the validity and enforceability of the Company's patents; uncertainty as to whether HuCNS-SC 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 manufacturing capabilities given its increasing preclinical and clinical commitments; uncertainties as to whether the Company will achieve revenues from product sales or become profitable; and other factors that are described under the heading "Risk Factors" in Item 1A of Part II of the Company's Annual Report on Form 10-K.