StemCells, Inc. Names Maria Millan, M.D., F.A.C.S., to Lead Its Liver Cell Transplant Program

PALO ALTO, Calif.--()--Jan. 10, 2006--StemCells, Inc. (NASDAQ: STEM) today announced that Dr. Maria Millan has joined the Company as Director, Liver Cell Transplant Program. Dr. Millan, a transplant surgeon, is on leave from her positions as Associate Professor of Surgery, Division of Multi-Organ Transplant, and Director of Pediatric Transplant Programs, Kidney & Liver, at Stanford University School of Medicine. Dr. Millan has a long-standing interest in the potential of cellular transplants and has been closely involved with the Company's liver stem cell program as a member of StemCells, Inc.'s Scientific Advisory Board. She joins StemCells, Inc. now to lead the Company's efforts to bring its candidate liver stem cell into the clinic.

"As previously announced, our scientists have been working diligently on our candidate human liver stem cell, on which we filed a patent application in 2002, to further elucidate its biological properties in vivo in various animal models. We are now sufficiently satisfied with the performance of this cell in vivo that we are committing the resources necessary to enable clinical testing as soon as possible," said Martin McGlynn, President and Chief Executive Officer of StemCells, Inc. "We are thrilled that we have been able to attract a clinician of Dr. Millan's experience and credentials to the Company to lead this effort. This is a very exciting time for StemCells, Inc. In addition to this initiative in the liver field, our human neural stem cell product, HuCNS-SC(TM), has been cleared by the FDA for clinical testing in Batten disease and we look forward to dosing the first patient in the not too distant future."

"As transplant physicians and surgeons, we are fortunate to be able to treat patients suffering from end-stage organ failure with organ transplantation. However, there are so many individuals who are unable to receive organ transplants in a timely fashion and a significant number who are not surgical candidates because of severe co-existing medical conditions. I have great interest in bringing cellular therapy into clinical practice as a necessary alternative to whole organ transplant," said Dr. Millan. "I believe that the liver stem cell identified by the Company's research team shows great potential as a candidate cellular therapeutic for treating diseases of the liver and I am glad to have the opportunity to work with the StemCells team."

Dr. Millan brings a strong scientific and medical background in liver, pancreas and kidney transplantation. She was an Investigator on numerous grants related to transplantation science and has co-authored peer-reviewed research and review articles in prestigious journals such as Transplantation, Journal of Experimental Medicine, and Journal of Immunology. She is licensed by the Medical Board of California and certified by the American Board of Surgery and the American Society of Transplant Surgeons. Dr. Millan is currently a member of nine national or international medical, surgical and transplant societies.

Dr. Millan received her M.D. from the New Jersey Medical School, and was a Resident and Chief Resident in General Surgery at Harvard Medical School/New England Deaconess Hospital and the Beth Israel Deaconess Medical Center in Boston, Mass. She received a research fellowship in Immunobiology at Harvard Medical School. Dr. Millan held a Fellowship in Multi-Organ Transplant Surgery at Stanford Medical School in 1998-99, after which she remained at the school as a member of the faculty.

About StemCells, Inc.

StemCells, Inc. is a clinical stage biotechnology company focused on the discovery, development and commercialization of stem cell-based therapeutics to treat diseases of the central nervous system, liver and pancreas. The Company's stem cell programs seek to repair or repopulate neural or other organ tissue that has been damaged or lost as a result of disease or injury. To date, the Company has discovered the human neural stem cell as well as candidate human liver and pancreas stem cells. Recently, the U.S. Food and Drug Administration authorized the Company to initiate clinical testing of its proprietary neural stem cell product, HuCNS-SC, in Batten disease, a rare and always fatal neurodegenerative disease. StemCells is solely focused on stem cell research and development and has approximately 40 U.S. and 100 non-U.S. patents, as well as more than 100 patent applications pending worldwide. Further information about the Company is available on its web site at: www.stemcellsinc.com.

About Liver Disease

According to the American Liver Foundation (AFL), 25 million Americans, or about one in every 10, are or have been afflicted with a liver, biliary or gallbladder disease. Over 20,000 Americans die each year from chronic liver disease and cirrhosis; over 350,000 people are hospitalized each year due to cirrhosis. It is estimated that 25,000 people are infected with hepatitis C each year, and 10 to 12 thousand people die of it each year. According to Center for Disease control estimates, the number of annual deaths from hepatitis C will triple in the next 10 - 20 years. In addition, AFL states that 1.25 million people are chronically infected with hepatitis B, which kills 5 to 6 thousand people a year. Organ transplantation is the only available therapy for end-stage liver failure at this time. Approximately 5,600 liver transplants were performed in 2003. Because of the shortage of organs, it is estimated that over 1,800 people died that year while waiting for a liver transplant. The United Network for Organ Sharing reports that about 5,850 liver transplants were performed in 2004 and about 4,700 in 2005. There are currently over 17,000 people waiting for a liver for transplantation.

Apart from statements of historical facts, the text of this press release constitutes forward-looking statements regarding, among other things, the future business operations of StemCells, Inc. (the "Company") and its ability to conduct clinical trials as well as its research and product development efforts. The forward-looking statements speak only as of the date of this news release. StemCells does not undertake to update any of these forward-looking statements to reflect events or circumstances that occur after the date hereof. Such statements reflect management's current views and are based on certain assumptions that may or may not ultimately prove valid. The Company's actual results may vary materially from those contemplated in the forward-looking statements due to risks and uncertainties to which the Company is subject, including uncertainty regarding the potential performance of the Company's candidate liver stem cell as a therapeutic agent; uncertainty regarding whether a suitable site for the Company's clinical trial in Batten disease will be identified, whether the Institutional Review Board approval that is required before a clinical trial may go forward will be obtained for any site, and whether results obtained in the animal models of Infantile NCL, spinal cord injury, or other diseases and conditions will be able to be translated into treatment for humans; uncertainty as to whether the FDA will permit the Company to continue clinical testing in the Batten disease trial or in future clinical trials of proposed therapies for other diseases or conditions despite the novel and unproven nature of the Company's technology; uncertainties regarding the Company's ability to obtain the capital resources needed to continue its current research and development operations and to conduct the research, preclinical development and clinical trials necessary for regulatory approvals; uncertainty regarding the validity and enforceability of the Company's patents; uncertainty as to whether HuCNS-SC and any products that may be generated in the future in the Company's stem cell programs, including the liver program, will prove safe and clinically effective and not cause tumors or other side effects; uncertainty as to whether the Company will achieve revenues from product sales or become profitable; and other factors that are described in Exhibit 99 to the Company's Annual Report on Form 10-K titled "Cautionary Factors Relevant to Forward-Looking Statements."

Contacts

Company Contact:
StemCells, Inc.
Rodney Young, 650-475-3100 ext 105
Chief Financial Officer
irpr@stemcellsinc.com
or
Media Contact:
Schwartz Communications, Inc.
781-684-0770
stemcells@schwartz-pr.com

Contacts

Company Contact:
StemCells, Inc.
Rodney Young, 650-475-3100 ext 105
Chief Financial Officer
irpr@stemcellsinc.com
or
Media Contact:
Schwartz Communications, Inc.
781-684-0770
stemcells@schwartz-pr.com