StemCells to acquire drug discovery technology of Stem Cell Sciences

10 March 2009

StemCells, Inc. (NASDAQ:STEM) has announced that it is to acquire the operating subsidiaries and certain related assets of Stem Cell Sciences (SCS) for 2,650,000 shares of StemCells common stock and approximately $715,000 in cash. Stem Cell Sciences is a Cambridge, UK-based company focused on commercializing applications of stem cell technologies for drug discovery and regenerative medicine research. StemCells, which is focused on the discovery and development of tissue-derived cellular products for therapeutic uses,

“The industrial logic of this acquisition is compelling,” said Martin McGlynn, President and CEO of StemCells. “StemCells has established itself as a world leader in tissue-derived stem and progenitor cells for therapeutic uses, while Stem Cell Sciences has focused on non-therapeutic applications for embryonic and tissue derived stem cells, such as cell-based assays for drug discovery and screening.

"This proposed acquisition will combine three distinct stem cell platforms, adult, embryonic and iPS cells, for both therapeutic and drug discovery applications, and will position StemCells to diversify and pursue near-term commercialization opportunities while continuing to develop our cell-based therapeutic products.”

“StemCells, Inc. is the logical home for our businesses,” said Alastair Riddell, Chief Executive Officer of Stem Cell Sciences. “Our respective technologies and capabilities are highly complementary, and the Stem Cell Sciences Board is confident StemCells has the knowledge and resources to fully leverage these assets and realize their potential value.”

Under the terms of the asset purchase agreement, StemCells will acquire substantially all of the operating assets and liabilities of SCS, including its research and development operations in Cambridge, UK and near Melbourne, Australia, and substantially all of its intellectual property portfolio. It is expected that most of SCS’ approximately 20 full-time current staff will remain with StemCells upon completion of the transaction.

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