NeoStem Begins Research Collaboration for Treatment of Skin Wounds in Scleroderma

Basking Ridge, New Jersey, UNITED STATES

NEW YORK, March 26, 2014 (GLOBE NEWSWIRE) -- NeoStem, Inc. (Nasdaq:NBS) ("NeoStem" or the "Company"), a leader in the emerging cellular therapy industry, today announced that it has signed an agreement for a research collaboration investigating the potential of very small embryonic-like stem cells ("VSELs™") in treating difficult to heal wounds in an animal model of scleroderma.

The collaboration is funded in part by a previously announced $147,765 grant from the Small Business Innovative Research Program for the "Development of Adult Pluripotent Very Small Embryonic Like (VSEL) Stem Cells to Treat Skin Wounds in Scleroderma" from the National Institutes of Health, National Institute of Arthritis and Musculoskeletal and Skin Diseases ("NIH-NIAMS").* The collaboration will be headed by Denis O. Rodgerson, Ph.D., Director of Grants and Academic Liaison of NeoStem, and Dr. Vincent Falanga, M.D., The Barbara A. Gilchrest Professor of Dermatology and Professor of Biochemistry at the Boston University School of Medicine.

The study will employ the tight skin ("Tsk") mouse to test the potential wound healing capabilities of autologous VSELs™ in treating difficult to heal skin ulcers characteristic of this disease. Depending on the results of the study, the Company may qualify for up to an additional $1.5 million phase 2 grant for the indication from NIH-NIAMS.

Preliminary data from Dr. Falanga's earlier research using a preclinical mouse model of severe complex wounds suggest that human VSELsTM may be more effective in accelerating healing than are mesenchymal stromal cells. That data showed that 14 days after treatment, mice treated with 2,500 human VSELsTM experienced a significantly greater percentage of wound re-epithelialization (covering with skin) than did those treated with either 500,000 human mesenchymal stromal cells or a control.

"We are encouraged by the data from Dr. Falanga's lab suggesting VSEL™ effectiveness in wound healing," said Dr. Robin Smith, Chairman and CEO of NeoStem. "The possibility that our research collaboration could advance treatments that one day could help patients suffering from scleroderma and chronic wounds is very exciting."

Over 300,000 people in the United States live with scleroderma, an autoimmune, connective tissue disorder which causes fibrosis of the skin and internal organs. Patients with scleroderma have an overproduction of extracellular matrix, and type 1 and 3 collagen. The disease involves vascular breakdown where the blood vessels in the skin degenerate and are replaced by collagen to form fibrotic tissue. The sclerotic tissue can also lead to digital ischemia and ulcers. Because of the vasculopathy, there is diminished blood supply to the lesion making the ulcers difficult to heal, prone to infection and possible progression to gangrene can occur that requires amputation. The ischemic ulcers are frequent, painful, and cause significant morbidity. There is presently no effective treatment of scleroderma or the ischemic ulcers.

* This research is supported by the National Institute of Arthritis And Musculoskeletal and Skin Diseases of the National Institutes of Health under Award Number 1R43AR062432-01A1. The content of this press release is solely the responsibility of the authors and does not necessarily represent the official views of the National Institutes of Health.

About VSELTM Technology

NeoStem scientists have been evaluating the therapeutic potential of so-called very small embryonic-like stem cells ("VSELsTM" or "VSELTM stem cells"). These cells were originally described in mice by researchers at the University of Louisville. The Company's research has identified cells in human blood and bone marrow that have many of the properties described for murine VSELsTM. This research includes evidence of multipotency and multi-lineage differentiation. These observations provide the groundwork for the development of VSELTM therapies to regenerate or repair damaged or diseased tissues in human subjects.

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.

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, including with respect to the Company's ability to develop and grow its business, the successful development of cellular therapies, including with respect to the Company's research and development and clinical evaluation efforts in connection with the Company's CD34 Cell Program, T-Regulatory Cell Program, VSEL™ Technology for tissue regeneration and other cell therapies, including 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 on March 13, 2014 and in the Company's 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.



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