Proprietary adult stem cell platform, an effective treatment for diabetes, shows study

Treatment for Diabetic Patients a Major New Objective

Key points:

*Single injection of proprietary adult stem cells resulted in increased blood insulin levels and sustained reduction in blood glucose levels

*Stem cell treatment induced two-fold increase in total numbers of pancreatic islets, and increase in insulin-producing beta cells

*Results indicate pancreas may successfully be regenerated by proprietary adult stem cells

*Estimated 230 million people worldwide suffer from diabetes; massive commercial opportunity

*Plans to commence clinical trial program

Australia's regenerative medicine company, Mesoblast Limited (ASX: MSB), today announced significant preclinical trial results showing that the proprietary adult stem cell platform could be an effective treatment for diabetes.

In the study, led by Dr. Ravi Krishnan, Senior Scientist at the Queen Elizabeth Hospital in Adelaide, South Australia, in collaboration with Mesoblast's United States-based associate company Angioblast Systems Inc., a single dose of the patented human Mesenchymal Precursor Cells (MPCs) injected into mice with diabetes resulted in a significant increase in blood insulin levels and sustained reduction in blood glucose levels for the entire three week period of follow-up. This was due to restoration in the damaged pancreas of the balance between insulin-producing beta cells, which reduce blood glucose, and glucagon-producing alpha cells, which increase blood glucose.

Leading international diabetes expert Professor Michael Horowitz, Director of the Endocrine and Metabolic Unit at the Royal Adelaide Hospital, who has reviewed the results said: "These data are very exciting, and clearly demonstrate the potential of using these unique adult stem cells in the treatment of patients with Type 2 diabetes."

Type 2 diabetes accounts for 90-95 per cent of the 230 million diabetics in the western world, and its prevalence is increasing at an alarming rate. Complications include heart disease, chronic kidney failure, blindness, nerve damage and lower extremity amputations. Injections of insulin are used only as a last resort in Type 2 diabetics because of the risk of lowering glucose levels too greatly and too rapidly (hypoglycemia). Newer treatment modalities for Type 2 diabetes aim to enhance the ability of pancreatic beta cells to produce more insulin in an effort to better control blood glucose.

In the collaborative study, diabetes was induced by partial chemical destruction of the pancreas in 35 mice that were then randomised to receive either a single injection into the bloodstream of human MPCs or control. Three weeks later, MPC-treated diabetics had two-fold greater numbers of pancreatic islets than diabetic controls>

"These results suggest that the MPCs enhanced endogenous pancreatic beta cell regeneration, resulting in safe and sustained augmentation of insulin secretion and reduction in blood glucose levels," Professor Horowitz added.

Mesoblast Executive Director, Professor Silviu Itescu, said: "The Company will move quickly towards the clinic to target what is termed the western world's largest healthcare epidemic.

"We believe there is clear proof of principle to use our patented cells for diabetes and we will work towards translating these results to humans as quickly as possible," he added.