NeoStem Announces UCSF Presentation of Phase 1 Results for T Regulatory Cell Immunotherapy for Type 1 Diabetes at American Diabetes Association Annual Meeting

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-- Preliminary Data Indicate Safety and Tolerability in Adult Patients and Complement Recently Published 12-Month Data Indicating Feasibility and Potential Efficacy in Children With T1DM --

-- Initiation of Phase 2 Study Expected for Q3 2014 --

NEW YORK, June 16, 2014 (GLOBE NEWSWIRE) -- NeoStem, Inc. (Nasdaq:NBS) ("NeoStem" or the "Company"), a leader in the emerging cellular therapy industry, today announced the presentation of the results of an open-label dose escalation Phase 1 clinical study of autologous T regulatory cell (Treg) immunotherapy for type 1 diabetes mellitus (T1DM) indicating safety and tolerability following administration. This study, funded by the Juvenile Diabetes Research Foundation and conducted by Dr. Stephen Gitelman at University of California, San Francisco (UCSF) and Dr. Kevan Herold at Yale University, provides preliminary data that support developing a novel therapy for the treatment of T1DM with the goal of inducing immune tolerance and preserving pancreatic beta cell function. The results were presented by Dr. Gitelman at this week's American Diabetes Association 74th Scientific Sessions in San Francisco.

The autologous T-regulatory cell product that is being developed by NeoStem is designed to restore immune balance by enhancing Treg number and function. The cells are produced through a methodology developed by Jeffrey Bluestone, PhD and colleagues at UCSF for isolating, expanding and infusing patients' own Tregs. A natural part of the human immune system, Tregs help maintain balance in the immune system, which is thought to be out of balance in the setting of autoimmune diseases such as T1DM.1 The technology, study data and any resulting product (termed NBS-03) are licensed exclusively by NeoStem. NeoStem expects to initiate a Phase 2 new onset T1DM study in Q3 2014.

"These positive preliminary data provide initial evidence of safety and tolerability of an autologous cell therapy designed to stop the immune attack on the pancreas. Some treated patients had stable beta cell function for up to 24 months following the Treg treatment," said Dr. Gitelman. "We are excited about the Phase 2 program beginning later this year to further assess safety and to evaluate the efficacy of this novel therapy."

As reported by UCSF, in the study, 14 patients between 18 and 45 years of age with a mean duration of disease of 10 months all of whom retained a baseline level of insulin production, received a single infusion of autologous Tregs expanded ~500-fold. The infusions were well tolerated; the majority of adverse events reported were mild. Infused Tregs peaked in circulation 3-7 days after infusion and were detectable at >6 months. The average levels of stimulated C-peptide, an indicator of pancreatic islets beta cell function, for some patients remained stable from baseline for as long as 2 years post treatment. These data suggest that the treatment was safe and did not adversely affect residual beta cell function. The Tregs were observed to be highly functional and long lived in treated individuals.

"This research holds the promise of an innovative new treatment approach that may change the course of type 1 diabetes and significantly improve patients' lives," said Douglas W. Losordo, MD, FACC, FAHA, Chief Medical Officer, NeoStem. "We are very excited to see that this study provides additional safety and feasibility data supportive of a recently published study that indicated favorable safety, feasibility, and preliminary efficacy in children with new onset T1DM. Given the relevance of these endpoints to recently diagnosed diabetic children and their families, we look forward to assessing the potential efficacy of NBS-03 in a Phase 2 study later this year."

While the U.S. Phase 1 study was designed to evaluate safety and tolerability in adults who have suffered T1DM for various durations, supportive evidence of the utility of Tregs for T1DM in humans was provided by a study of pediatric patients with new onset T1DM, published in the July 2014 issue of Clinical Immunology. In that study, Marek-Trzonkowska, et al. reported that treatment with expanded autologous Tregs preserved function of pancreatic beta cells and reduced the need for exogenous insulin in the majority of patients. After 12 months of follow-up, about 66 percent of children treated were in remission,* compared to only 20 percent of concurrent controls, and two Treg treated children achieved complete insulin independence, while none of the control children achieved this endpoint.2

About NBS-03

NBS-03 is a CD4+ CD127lo/-CD25+ polyclonal T regulatory cell therapy under development that uses NeoStem's proprietary methodology to isolate the patient's own Treg cells through activation agents containing surface markers specific for Treg cells, expands them over two weeks using a growth factor, and infuses the purified Treg cell product into the patient intravenously. This technology was developed by the University of California, San Francisco, and licensed exclusively by NeoStem. NeoStem is currently evaluating NBS-03 as a single-infusion therapy for new onset type 1 diabetes and expects to initiate a prospective placebo-controlled double-blind Phase 2 study in Q3 2014. Additional autoimmune and inflammatory disorders that may be targeted with this therapy include lupus, multiple sclerosis and graft versus host disease, among others. Additionally NeoStem expects to initiate a proof of concept study in Canada in support of a steroid resistant asthma indication later this year.

About Type 1 Diabetes Mellitus (T1DM)

Sometimes called "insulin dependent diabetes" or "juvenile diabetes," T1DM is a chronic autoimmune disease that destroys insulin-producing (beta cells) of the pancreas – resulting in total insulin deficiency. T1DM is one of the most common and costly pediatric diseases, affecting 1 in 300 children, and the incidence of T1DM has been increasing by approximately 3 percent annually in the US and abroad. Diabetes is the leading cause of kidney failure, nontraumatic lower-limb amputations, and new cases of blindness among adults in the United States. T1DM has no cure, although it can be managed with insulin treatment.

UC Disclaimer for Industry Releases

The information stated above was prepared by NeoStem, Inc., and reflects solely the opinion of the corporation. Nothing in this statement shall be construed to imply any support or endorsement of NeoStem, or any of its products, by The Regents of the University of California, its officers, agents and employees.

About NeoStem, Inc.

NeoStem is a leader in the emerging cellular therapy industry, pursuing the preservation and enhancement of human health globally through the development of cell based therapeutics that prevent, treat or cure disease by repairing and replacing damaged or aged tissue, cells and organs and restoring their normal function. The business includes the development of novel proprietary cell therapy products as well as a revenue-generating contract development and manufacturing service business. This combination has created an organization with unique capabilities for cost effective in-house product development and immediate revenue and cash flow generation. WWW.NEOSTEM.COM.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect management's current expectations, as of the date of this press release, and involve certain risks and uncertainties. Forward-looking statements include statements herein with respect to the successful execution of the Company's business strategy, the Company's ability to develop and grow its business, the successful development of cellular therapies with respect to the Company's research and development and clinical evaluation efforts in connection with the Company's Targeted Immunotherapy Program, CD34 Cell Program, T Regulatory Cell Program (including whether positive data is generated for NBS-03 or whether NeoStem will successfully develop NBS-03 to treat type 1 diabetes mellitus (T1DM)) and other cell therapies, the future of the regenerative medicine industry and the role of stem cells and cellular therapy in that industry and the performance and planned expansion of the Company's contract development and manufacturing business. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors. Factors that could cause future results to materially differ from the recent results or those projected in forward-looking statements include the "Risk Factors" described in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC") on March 13, 2014, the Company's Current Report on Form 8-K filed with the SEC on May 8, 2014 and in the Company's other periodic filings with the SEC. The Company's further development is highly dependent on future medical and research developments and market acceptance, which is outside its control.

* DDI ≤ 0.5 UI/kg b.w. and fasting C-peptide > 0.5 ng/ml 1 year after recruitment


1 Tang, Q. and J.A. Bluestone, The Foxp3+ regulatory T cell: a jack of all trades, master of regulation. Nat Immunol. 2008;9(3):239-244.

2 Marek-Trzonkowska N, Myśliwiecb M, Dobyszukc A, et al. Therapy of type 1 diabetes with CD4+CD25highCD127-regulatory T cells prolongs survival of pancreatic islets — results of one year follow-up. Clin Immunol. 2014;153(1):23–30.

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