NeoStem Awarded NIAID Research Grant for the Development of VSEL Technology for Radiation Exposure

NeoStem Awarded NIAID Research Grant for the Development of VSEL Technology for Radiation Exposure

June 25, 2012

NeoStem, Inc. (NYSE MKT: NBS) (“NeoStem” or the “Company”), a cell therapy company, today announced that it has been awarded a two year grant totaling $595,252 for the “Development of Human, Autologous, Pluripotent Very Small Embryonic Like (VSELs) Stem Cells as a Countermeasure to Radiation Threat” from the National Institute of Allergy and Infectious Diseases (NIAID), a division of the National Institutes of Health (NIH). This peer reviewed grant was awarded to support research to be headed by Denis O. Rodgerson, Ph.D., Director of Stem Cell Science for NeoStem and Mariusz Ratajczak, M.D., Ph.D., who is the head of the Stem Cell Biology Program at the James Graham Brown Cancer Center at the University of Louisville and co-inventor of VSELTM Technology.

This award will fund studies to investigate the potential of very small embryonic-like stem cells as a countermeasure to radiological and nuclear threat. The product candidate, which is an autologous stem cell therapy derived from the patient’s own stem cells, will be developed to rescue patients who have been exposed to radiation due to nuclear accident or terrorist threat and to treat cancer patients who have undergone radiation therapy and who consequently have compromised immune systems. The award includes $295,252 for the first year and $300,000 for the second year of the project.

Dr. Denis O. Rodgerson, Director of Stem Cell Science for NeoStem, said, “We are very excited to add radiation treatment to the growing list of indications for which our VSELTM Technology is being evaluated. Those exposed to acute high-dose radiation have compromised immune systems such that the virulence and infectivity of biological agents is dramatically increased. Death can occur within 1-6 weeks following radiation exposure. Currently there is only one intervention that saves a fatally irradiated person – a rescue through stem cell transplantation. VSELs might be an ideal cell therapy to regenerate the body’s immune system and repair other tissues damaged by radiation exposure. Most importantly, early studies show VSELS are resistant to lethal radiation which destroys other immune system restoring stem cells in the body, making autologous treatment post-exposure possible.”

Dr. Robin L. Smith, Chairman and CEO of NeoStem, added, “NeoStem is pleased that the NIAID is funding this cutting edge technology that we hope will reinvent the treatment landscape for acute radiation syndrome.  We plan to continue to pursue NIH SBIR grants to fund our VSEL technology platform development with non-dilutive capital.”

About VSELTM Technology

NeoStem has a worldwide exclusive license to VSELTM Technology. Research by Dr. Mariusz Ratajczak, M.D., Ph.D., and others at the University of Louisville provides compelling evidence that bone marrow contains a heterogeneous population of stem cells that have properties similar to those of an embryonic stem cell. These cells are referred to as very small embryonic-like stem cells. This finding opens the possibility of capturing some of the key advantages associated with embryonic stem cells without the ethical or moral dilemmas and without some of the potential negative biological effects associated with stem cells of embryonic derivation. The possibility of autologous VSEL treatments is yet another important potential benefit to this unique population of adult stem cells. VSELTM Technology offers the potential to go beyond the paracrine effect, yielding cells that actually differentiate into the target tissue creating true cellular regeneration.

About NeoStem, Inc.

NeoStem, Inc. (“we,” “NeoStem” or the “Company”) continues to develop and build on its core capabilities in cell therapy to capitalize on the paradigm shift that we see occurring in medicine. In particular, we anticipate that cell therapy will have a large role in the fight against chronic disease and in lessening the economic burden that these diseases pose to modern society. Our January 2011 acquisition of Progenitor Cell Therapy, LLC (“PCT”) provides NeoStem with a foundation in both manufacturing and regulatory affairs expertise. We believe this expertise, coupled with our existing research capabilities and collaborations, will allow us to achieve our mission of becoming a premier cell therapy company. Our PCT subsidiary’s manufacturing base is one of the few current Good Manufacturing Practices (“cGMP”) facilities available for contracting in the burgeoning cell therapy industry. Amorcyte, LLC (“Amorcyte”), which we acquired in October 2011, is developing a cell therapy for the treatment of cardiovascular disease. Amorcyte’s lead compound, AMR-001, represents NeoStem’s most clinically advanced therapeutic and Amorcyte is enrolling patients for a Phase 2 trial to investigate AMR-001’s efficacy in preserving heart function after a heart attack. We also expect to begin a Phase 1 clinical trial by 2012/2013 to investigate AMR-001’s utility in arresting the progression of congestive heart failure and the associated comorbidities of that disease. Athelos Corporation (“Athelos”), which is approximately 80%-owned by our subsidiary, PCT, is engaged in collaboration with Becton-Dickinson that is exploring the earlier stage clinical development of a T-cell therapy for autoimmune conditions. In addition, our pre-clinical assets include our VSELTM Technology platform as well as our MSC (mesenchymal stem cells) product candidate for regenerative medicine.