$AST Update on Full Six-Patient Cohort Confirms AST-OPC1 Efficacy

-Newly reported data on sixth and final patient in cohort further confirms previously announced improvements in hand and arm function following dosing-

FREMONT, Calif., March 21, 2017 — Asterias Biotherapeutics, Inc. (NYSE MKT: AST), a biotechnology company pioneering the field of regenerative medicine, reported that including the sixth and final patient in the AIS-A 10 million cell cohort in the company’s ongoing SCiStar Phase 1/2a clinical trial has further confirmed previously-announced motor function improvements at 6-months following administration of AST-OPC1.

“We are excited to see the sixth and final patient in the AIS-A 10 million cell cohort show upper extremity motor function improvement at 3 months and further improvement at 6 months, especially because this particular patient’s hand and arm function had actually been deteriorating prior to receiving treatment with AST-OPC1,” stated Dr. Edward Wirth III, Chief Medical Officer. “We are very encouraged by the meaningful improvements in the use of arms and hands seen in the SciStar study to date since such gains can increase a patient’s ability to function independently following complete cervical spinal cord injuries.”

Improvements in upper extremity motor function are being measured using the International Standards for Neurological Classification of Spinal Cord Injury (ISNCSCI) scale, widely used to quantify functional status of patients with spinal cord injuries.  Both subjects and physicians consistently report that improvements in upper extremity motor function are the most desirable functional improvement target in the quadriplegic population, as they can have a significant impact on functional independence, quality of life and cost of care from even relatively modest changes.   The SCiStar study is monitoring two separate ISNCSCI measurements of upper extremity motor function.  The upper extremity motor score (UEMS), is a linear scale used to quantify motor function at each of five upper extremity muscle groups driving arm and hand function; these scores are also used to calculate “motor levels”, which define the level within the cord above which a subject has a certain minimum level of function.

The UEMS improvement at 6-months for the final patient was 9 points and in line with the median and average 6-month UEMS improvement for all six patients in this cohort (9.7 average; 9 median). In all six patients, administration of AST-OPC1 was followed by early improvements in UEMS at 3-months that were sustained or further increased through their most recent follow-up assessment.

In addition to the motor score gains, the final patient in the AIS-A 10 million cell cohort has so far achieved a one motor level improvement over baseline on both sides of his body.   All six patients in this cohort have now achieved at least a one motor level improvement over baseline on at least one side.

“These results are quite encouraging, and suggest that there are meaningful improvements in the recovery of functional ability in patients treated with the 10 million cell dose of AST-OPC1 versus spontaneous recovery rates observed in a closely matched untreated patient population,” said Steve Cartt, Chief Executive Officer of Asterias. “We look forward to reporting additional efficacy and safety data for this cohort, as well as for the currently-enrolling AIS-A 20 million cell and AIS-B 10 million cell cohorts, later this year.”

The trial results to date continue to indicate a positive safety profile for AST-OPC1. There have been no serious adverse events related to AST-OPC1 and data from the study indicate that AST-OPC1 can be safely administered to patients in the subacute period after severe cervical spinal cord injury.

Each year in the U.S. more than 17,000 people suffer a severe, debilitating spinal cord injury. These injuries can be devastating to quality of life and ability to function independently. Lifetime healthcare costs for these patients can often approach $5 million. Improvements in arm, hand and finger functional capabilities in these patients can result in lower healthcare costs, significant improvements in quality of life, increased ability to engage in activities of daily living, and increased independence.

About the SCiStar Trial

The SCiStar trial is an open-label, single-arm trial testing three sequential escalating doses of AST-OPC1 administered at up to 20 million AST-OPC1 cells in as many as 35 patients with sub-acute, C-5 to C-7, motor complete (AIS-A or AIS-B) cervical SCI. These individuals have essentially lost all movement below their injury site and experience severe paralysis of the upper and lower limbs. AIS-A patients have lost all motor and sensory function below their injury site, while AIS-B patients have lost all motor function but may retain some minimal sensory function below their injury site. AST-OPC1 is being administered 14 to 30 days post-injury. Patients will be followed by neurological exams and imaging procedures to assess the safety and activity of the product.

The study is being conducted at six centers in the U.S. and the company plans to increase this to up to 12 sites to accommodate the expanded patient enrollment. Clinical sites that have enrolled and dosed patients in the study include the Medical College of Wisconsin in Milwaukee, Shepherd Medical Center in Atlanta, University of Southern California (USC) in Los Angeles, Rush University Medical Center in Chicago and Santa Clara Valley Medical Center in San Jose.

Asterias has received a Strategic Partnerships Award grant from the California Institute for Regenerative Medicine, which provides $14.3 million of non-dilutive funding for the Phase 1/2a clinical trial and other product development activities for AST-OPC1.

Additional information on the Phase 1/2a trial, including trial sites, can be found at www.clinicaltrials.gov, using Identifier NCT02302157, and at the SCiStar Study Website (www.SCiStar-study.com).

About AST-OPC1

AST-OPC1, an oligodendrocyte progenitor population derived from human embryonic stem cells, has been shown in animals and in vitro to have three potentially reparative functions that address the complex pathologies observed at the injury site of a spinal cord injury. These activities of AST-OPC1 include production of neurotrophic factors, stimulation of vascularization, and induction of remyelination of denuded axons, all of which are critical for survival, regrowth and conduction of nerve impulses through axons at the injury site. In preclinical animal testing, AST-OPC1 administration led to remyelination of axons, improved hindlimb and forelimb locomotor function, dramatic reductions in injury-related cavitation and significant preservation of myelinated axons traversing the injury site.

In a previous Phase 1 clinical trial, five patients with neurologically complete, thoracic spinal cord injury were administered two million AST-OPC1 cells at the spinal cord injury site 7-14 days post-injury. They also received low levels of immunosuppression for the next 60 days. Delivery of AST-OPC1 was successful in all five subjects with no serious adverse events associated with AST-OPC1. No evidence of rejection of AST-OPC1 was observed in detailed immune response monitoring of all patients. In four of the five patients, serial MRI scans indicated that reduced spinal cord cavitation may have occurred. Based on the results of this study, Asterias received clearance from FDA to progress testing of AST-OPC1 to patients with complete cervical spine injuries, which represents the first targeted population for registration trials.

About Asterias Biotherapeutics

Asterias Biotherapeutics, Inc. is a biotechnology company pioneering the field of regenerative medicine. The company’s proprietary cell therapy programs are based on its immunotherapy and pluripotent stem cell platform technologies. Asterias is presently focused on advancing three clinical-stage programs which have the potential to address areas of very high unmet medical need in the fields of neurology and oncology. AST-OPC1 (oligodendrocyte progenitor cells) is currently in a Phase 1/2a dose escalation clinical trial in spinal cord injury. AST-VAC1 (antigen-presenting autologous dendritic cells) is undergoing continuing development by Asterias based on promising efficacy and safety data from a Phase 2 study in Acute Myeloid Leukemia (AML), with current efforts focused on streamlining and modernizing the manufacturing process. AST-VAC2 (antigen-presenting allogeneic dendritic cells) represents a second generation, allogeneic cancer immunotherapy. The company’s research partner, Cancer Research UK, plans to begin a Phase 1/2a clinical trial of AST-VAC2 in non-small cell lung cancer in 2017. Additional information about Asterias can be found at www.asteriasbiotherapeutics.com.

FORWARD-LOOKING STATEMENTS

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