Novocell Presents Phase I/II Data on Safety and Response to Encapsulated Islets at the American Diabetes Association’s 66th Annual Scientific Session

Novocell’s Chief Scientific Officer Speaks in a Symposium on Engineering Stem Cells to Endoderm, the First Step to Producing Unlimited Numbers of Insulin-Producing Islet Cells

Washington, D.C. / June 12, 2006 / PRNewswire / Novocell, Inc., a stem cell engineering company, presented preliminary data from its Phase I/II proof-of-principle clinical trial for encapsulated primary human islet allografts in a late-breaking poster presentation today at the American Diabetes Association’s 66th Scientific Session.

The poster, entitled “Encapsulated Human Islet Allografts — Phase I/II Clinical Trial”, described safety and efficacy results following subcutaneous implants of encapsulated human islet allografts into patients with Type I diabetes of long standing duration. The first two partially implanted patients are showing early evidence of encapsulated islet function. The recipients are not showing evidence of encapsulated islet destruction by autoimmune reactions or allograft rejection to date. The patients only received transient low dose cyclosporine (50-100 ng/ml 12hr trough) and do not receive cyclosporine long term or any other form of immunosuppression.

“Patients are free of any safety concerns or adverse events to date,” commented David Scharp, M.D., Chief Medical Officer. “We hope to see additional efficacy as these recipients receive increasing doses of encapsulated islets.”

The single site study is being conducted in San Antonio, Texas, with Co-Principal Investigators, Sherwyn Schwartz, M.D., Director of the Diabetes and Glandular Disease Center, and Paraic Mulgrew, M.D., of the Transplant Institute at the Christus Santa Rosa Hospital. The study is partially funded by the Juvenile Diabetes Research Foundation.

Novocell believes its proof of principle study is important to demonstrate the safety and efficacy of the encapsulation technology that can be used with the unlimited source of insulin-producing cells developed from stem cells to treat patients with diabetes.

Toward this goal, Chief Scientific Officer Emmanuel Baetge, Ph.D., will discuss engineering stem cells into definitive endoderm, the gatekeeper cells that are required to produce unlimited quantities of human islet cells, in a symposium entitled “First Steps in Making Beta-Cells from Stem Cells” on Tuesday, June 13th, from 8 a.m. to 10 a.m. at this same meeting. Dr. Baetge’s work in this area was published in Nature Biotechnology in December of 2005 and reviewed in the New England Journal of Medicine in February 2006. He will also address the importance of the endoderm in the creation of insulin-producing islet cells.

The combination of stem cell engineering and cell encapsulation addresses the two primary issues currently limiting islet implant therapy for the treatment of diabetes: chronic immunosuppression and islet cell supply. Novocell is currently engineering stem cell-derived endoderm for the production of insulin-producing islet cells as a solution to the limited islet supply for implantation in people with diabetes.

About Novocell, Inc.

Novocell, Inc. is a stem cell engineering company with research operations in Irvine and San Diego, CA, and Athens, GA, dedicated to creating, delivering and commercializing cell and drug therapies for diabetes and other chronic diseases. Novocell is the first company to efficiently engineer human embryonic stem cells into definitive endoderm, the gatekeeper cells that differentiate into many other cells, tissues and organs. Novocell has three primary technologies: stem cell-directed lineage, encapsulation and drug discovery. The company was founded in 1999 and merged with CyThera and BresaGen in 2004.