StemCells, Inc. Enters Agreement to Receive $19.3 Million From California Institute for Regenerative Medicine to Help Fund IND

StemCells, Inc. Enters Agreement to Receive $19.3 Million From California
Institute for Regenerative Medicine to Help Fund IND for Alzheimer's Disease

NEWARK, Calif., April 11, 2013 (GLOBE NEWSWIRE) -- StemCells, Inc.
(Nasdaq:STEM) today announced that it has entered into an agreement with the
California Institute for Regenerative Medicine (CIRM) under which CIRM will
provide approximately $19.3 million to help fund preclinical development and
IND-enabling activities of the Company's proprietary HuCNS-SC® product
candidate (purified human neural stem cells) for Alzheimer's disease. The
funding, which will be in the form of a forgivable loan, was awarded under
CIRM's Disease Team Therapy Development Award program (RFA 10-05) in September
2012.The goal of the research will be to file an Investigational New Drug
(IND) application with the U.S. Food and Drug Administration within four

"With CIRM's support, we are now able to lay the groundwork that could result
in the world's first neural stem cell trial in Alzheimer's patients,"
commented Martin McGlynn, President and CEO of StemCells, Inc. "Currently,
there are no good treatment options for Alzheimer's patients, and there aren't
any on the horizon, so it is clear that the field could benefit from creative
approaches to this devastating and challenging disease.Our collaborators at
UC Irvine have provided a compelling preclinical rationale to test the utility
of our cells to restore memory in patients afflicted with this deadly

StemCells, Inc. will evaluate its HuCNS-SC cells as a potential therapeutic in
Alzheimer's disease in collaboration with researchers at the University of
California, Irvine (UCI) led by Frank LaFerla, Ph.D., a world-renowned
researcher in the field, and Matthew Blurton-Jones, Ph.D.Dr. LaFerla is
Director of the Institute for Memory Impairments and Neurological Disorders
(UCI MIND), and Chancellor's Professor, Neurobiology and Behavior. Dr.
Blurton-Jones is Assistant Professor, Neurobiology and Behavior, at UCI.

In July 2012, Dr. Blurton-Jones presented data at the Alzheimer's Association
Annual Meeting demonstrating that the Company's neural stem cells restored
memory and significantly enhanced synaptic function in two animal models
relevant to Alzheimer's disease.Importantly, these results did not require
reduction in beta amyloid or tau that accumulates in the brains of patients
with Alzheimer's disease and account for the pathological hallmarks of the

Terms and Conditions of the Loan

Loan funds are expected to be disbursed periodically over the four-year
project period, with disbursements subject to a number of preconditions,
including the achievement of certain progress milestones and compliance with
certain financial covenants. The term of the loan is ten years, but may be
extended under certain circumstances.The loan is unsecured and will bear
interest at the one year LIBOR rate plus two percent; however, the interest
rate will increase by one percent each year after year five.The loan is
forgivable, such that the Company's obligation to repay the loan will be
contingent upon the success of HuCNS-SC cells in Alzheimer's disease.No
warrants will be issued in connection with the loan, but the Company will owe
various success milestone payments in the event of the product's commercial

About Alzheimer's Disease

Alzheimer's disease is a progressive, fatal neurodegenerative disorder that
results in loss of memory and cognitive function. Today there is no cure or
effective treatment option for patients afflicted by Alzheimer's disease.
According to the Alzheimer's Association, approximately 5.4 million Americans
have Alzheimer's disease, including nearly half of people aged 85 and
older.The prevalence of Alzheimer's disease is expected to increase rapidly
as a result of the country's aging population.

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:

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. In
a PhaseI clinical trial in Pelizaeus-Merzbacher disease (PMD), a fatal
myelination disorder in children, the Company has shown preliminary evidence
of progressive and durable donor-derived myelination in all four patients
transplanted with HuCNS-SC cells.The Company is also conducting a Phase I/II
clinical trial in chronic spinal cord injury in Switzerland and recently
reported positive data for the first patient cohort.The Company is also
conducting a Phase I/II clinical trial in dry age-related macular degeneration
(AMD), and is pursuing preclinical studies in Alzheimer's disease. StemCells
also markets stem cell research products, including media and reagents, under
the SC Proven® brand.Further information about StemCells is available at

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 potential of the Company's
HuCNS-SC cells to treat a broad range of central nervous system disorders such
as Alzheimer's disease; the prospect of initiating a clinical trial in
Alzheimer's disease; the timing and prospects for funding by the California
Institute for Regenerative Medicine; and the future business operations of the
Company. 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 will be replicated in humans; uncertainties
about the prospect and timing of entering into the agreements necessary to
receive funding from CIRM and whether the Company will satisfy, and continue
to satisfy, all preconditions for such funding; uncertainties about the
Company's ability to continue to satisfy the lending obligations under both
the Company's Silicon Valley Bank loan and the CIRM loan and repay these loans
when due; 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; and other factors that are described
under the heading "Risk Factors" in the Company's Annual Report on Form10‑K
for the year ended December 31, 2012, and in its subsequent reports on Forms
10-Q and 8-K.

CONTACT: Rodney Young
         StemCells, Inc.
         Chief Financial Officer
         (510) 456-4128
         Ian Stone
         Russo Partners
         (619) 308-6541

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