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NEWARK, Calif., Sept. 10, 2012 (GLOBE NEWSWIRE) -- StemCells, Inc. (Nasdaq:STEM) today announced that Martin McGlynn, President and CEO, provided additional comments about the approval of two funding awards by the California Institute for Regenerative Medicine (CIRM).
In a letter to shareholders posted on the Company's website, Mr. McGlynn said:
"On Wednesday, September 5, the CIRM's governing board (the "ICOC") doubled down on its support of the groundbreaking translational research being conducted by StemCells, Inc. and its collaborators. It did this by voting to provide up to $20 million to help fund IND-enabling activities for the Company's HuCNS-SC
® cells (purified human neural stem cells) in Alzheimer's disease. The goal of this CIRM-funded project will be to file an IND within four years and to position the Company to start clinical testing of its HuCNS-SC cells in Alzheimer's upon FDA approval. This award, which was made under CIRM's Disease Team Therapy Development Awards program (RFA 10-05), is in addition to the funding previously approved by the ICOC in July to help fund IND-enabling activities by the Company for the testing of HuCNS-SC cells in cervical spinal cord injury, with the goal of that project also being an IND within four years.
"We view both these awards as a vote of confidence by CIRM's governing board for the ground-breaking science and outstanding track record and expertise of the assembled disease teams. Moreover, the ICOC is recognizing the serious unmet medical need, and the potential benefit of supporting novel therapeutic approaches, presented by these two CNS diseases.
"Under this particular CIRM program (RFA 10-05), funding for companies will be in the form of unsecured, non-recourse, interest-bearing, term loans, which will be forgivable in the event the funded research fails to result in a commercialized product. On the other hand, should the product be successfully commercialized, CIRM would earn milestone payments depending on how successful the product becomes. Because CIRM shares the downside risk, and could participate handsomely on the upside, the structure makes the loan about as close to "equity" as one could, without having to dilute existing shareholders in order to gain access to significant amounts of capital. The Company will not issue stock, warrants or other equity to CIRM in connection with these awards.