StemCells, Inc. to Initiate First Ever Neural Stem Cell Tria

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Collaborates With UCSF Children`s Hospital for Conduct of Study
PALO ALTO, Calif.--(Business Wire)--
StemCells, Inc. (NASDAQ:STEM) announced today that it will soon initiate with the University of California, San Francisco (UCSF) Children`s Hospital a Phase I clinical trial to evaluate the therapeutic potential of StemCells` proprietary HuCNS-SC® product candidate (purified human neural stem cells) to treat Pelizaeus-Merzbacher Disease (PMD), a myelination disorder that primarily affects infants and young children. Myelin is the substance which surrounds and insulates nerve fibers (axons), and enables nerve cells to communicate with one another. Patients suffering from PMD have insufficient myelination of nerve cells in the brain, which leads to loss of neurological function and eventually death in the most severe forms of the disease. In this trial, patients with a fatal form of PMD will be transplanted with the Company`s HuCNS-SC cells to evaluate safety and to explore the ability of the cells to myelinate the patients` nerve axons.

This trial will be the first ever clinical trial of neural stem cells in a myelination disorder, and will be the Company`s second clinical trial of its HuCNS-SC cells. The Company`s first clinical trial, a Phase I trial in neuronal ceroid lipofuscinosis (NCL, also often referred to as Batten disease) which was completed in January 2009, demonstrated a favorable safety profile along with evidence of engraftment and long-term survival of the HuCNS-SC cells.

"There is a compelling rationale for this trial, and it is a critical first step towards potentially helping seriously ill children who today have no treatment options, as this trial may provide proof-of-concept regarding the extent of myelination in these patients following transplantation of HuCNS-SC cells," said Martin McGlynn, President and CEO of StemCells, Inc.

Stephen Huhn MD, FACS, FAAP, Vice President and Head of the CNS Program at StemCells, Inc., added, "Our clinical development strategy has been to use our HuCNS-SC cells to provide what the patient`s own cells cannot, whether that is a missing enzyme, as in NCL, or myelin, as in PMD. The goal is to have our cells protect the patients` existing neurons and maintain their function. I believe that if we can show that these cells preserve neurological function in patients with PMD, then it is conceivable that patients suffering from other, more common, myelination disorders, such as multiple sclerosis, transverse myelitis and certain types of cerebral palsy, may also benefit from this approach."