SCS Wins EU Funding

Stem Cell Sciences plc
26 September 2007



Press Release

    Stem Cell Sciences wins EU Funding to use Stem Cells for drug discovery
                         ("Stem Cell Sciences", "SCS")

26 September 2007

Stem Cell Sciences plc (SCS; AIM:STEM, ASX: STC) announces today that it is to
lead an EU funded, multinational novel drug screening collaboration using stem
cells. The project, named "NEUROscreen", will use Stem Cell Sciences'
proprietary neural stem (NS) cell technology and has received a contribution
from the EU's 6th Framework Programme for Research and Technical Development
(FP6). The EU's contribution to the NEUROscreen project is worth €2.4 million
over three years, of which approximately €0.42 million will flow directly to SCS
over the three year period.
NEUROscreen brings together a unique partnership of leading European academic
research institutes and biotech companies from several nations, including the 
UK, Germany and Italy. The Programme involves designing unique bioassays based 
on SCS' neural stem cell technology, which will then be used to discover new
candidate medicines for the treatment of cancer, Alzheimer's disease, stroke and
epilepsy. Neural stem cells can differentiate into neurons and glia, therefore
offer potential in treating CNS disorders.

SCS' NS cells grow stably and uniformly, consistently producing neurons after
many months in culture. The cells adhere to tissue culture vessels and can be
expanded to large volumes using state-of-the-art laboratory robots. These are
features that provide a direct advantage to users of neural cells for drug
screening. SCS has validated a process for NS cell expansion using robotics from
its commercial partner, The Automation Partnership. This process guarantees a
consistent production of high quality cells delivered in quantities to suit most
drug screening campaigns. SCS' component of the project will be performed at its
automated stem cell production facility in Cambridge (UK) by the SC Services
team of assay design specialists.

"This is a tremendous opportunity to validate our human NS cell and NS
cell-derived cell types for drug discovery, all within a single, well defined
programme of work," said Dr. Lilian Hook, SCS' European Research Programme
Manager. "We expect that NEUROscreen will significantly add to the value of our
NS cell platform and broaden its utility in neural drug discovery and
development."
Commenting on the award of the funding, Peter Mountford, Chief Executive of SCS,
said: "We are very pleased that the EU has decided to fund SCS as coordinator
for NEUROscreen. The €420,000 that SCS will receive as leader of this project
demonstrates that our technology and capabilities are distinctive in the
industry. We look forward to increasing the range of drug discovery applications
and adding to our list of four large industry licensees of the technology.
NEUROscreen also provides SCS with the exciting prospect of discovering
proprietary drug leads."

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The content of this press release reflects the view of Stem Cell Sciences and
not the European Community. The Community is not liable for any use that may be
made of the information contained therein.

For further information, please contact:

Stem Cell Sciences plc (United Kingdom)                     [phone]
Tim Allsopp, Chief Scientific Officer
Halsin Partners                                             [phone]
Mike Sinclair
Stem Cell Sciences (Australia) pty ltd                      [phone]
Peter Mountford, President and CEO
Talk Biotech                                                [phone]
Fay Weston
Stem Cell Sciences llc (USA)                                [phone]
George Murphy, Vice President Business Development

Notes to Editors

SCS' NEURAL STEM CELLS

SCS' Neural Stem (NS) cell is the first tissue-specific cell identified that can
grow stably in the laboratory as a pure population of stem cells and without
ongoing differentiation. The new cells can be grown indefinitely in monolayer,
serum-free conditions in fully defined culture media, developed by Stem Cell
Sciences. It is a cell type that shows maintenance of stable biological potency
even after prolonged periods in culture. NS cells can differentiate to neurons
and glia, and offer a limitless source of cells for cell therapy in conditions
such as Parkinson's disease. The ability of NS cells to retain their capacity
for subsequent differentiation after prolonged growth in culture means they are
particularly useful in generating mature human brain cell types at a large
scale. In addition, as these cells can be derived from diseased donors and
subsequently used to differentiate into brain cells, in vitro models of the
disease can be created providing the basis for drug screening. Therefore, NS
cell lines offer potential in many areas of pharmaceutical research in
neurological disease and dysfunction, and it is anticipated that they will also
be of enormous benefit to the emerging regenerative medicine industry. These
cells provide the foundation of Stem Cell Sciences' cell therapy programmes.

ABOUT STEM CELL SCIENCES:

Stem Cell Sciences plc (SCS, AIM: STEM, ASX: STC) is a global biotechnology
company providing the biological infrastructure of cells and cell culture media
to the burgeoning stem cell research market.

Stem Cell Sciences' core objective is to develop safe and effective cell-based
therapies for currently incurable diseases. SCS retains all rights to its
technology for therapeutic use and is targeting cell-based therapies for
neurodegenerative disease and injury.

Revenues from Stem Cell Sciences' research business are delivered via an
integrated network of business teams and regional offices in Edinburgh and
Cambridge (UK), Kobe (Japan), Melbourne (Australia) and San Francisco (USA).
This global reach provides the Company with the direct access to markets through
experienced personnel and local business networks needed to drive SCS business
growth in each region.

The key challenge for the successful application of stem cells in both research
and clinical applications is the reproducible supply of pure, fully
characterized stem cells and stem cell-derived specialised cells such as nerves
and muscle. This represents a significant technological challenge that will
require access to multiple technologies and a globally integrated stem cell
initiative.

To access cutting edge technologies on a rapid and on-going basis, Stem Cell
Sciences has built an exceptional network of highly interactive collaborations
with academic centres of excellence in the stem cell field. These collaborations
have been the source of our founding technologies and continue to provide an
expanding pipeline of products and intellectual property that are central to the
Company's strategy and success.

To facilitate research and technology transfer with its major collaborating
academic institutions, Stem Cell Sciences' business and scientific teams are
usually co-located on site or adjacent to the centre of excellence in
independent company facilities. The Company's key collaborating institutes
include the Wellcome Trust Centre for Stem Cell Research (University of
Cambridge), the Institute of Stem Cell Research (University of Edinburgh), RIKEN
Centre for Developmental Biology (Kobe) and the Australian Stem Cell Centre
(Melbourne).

Academic and commercial use of stem cells in basic research and drug discovery
provides the Company with immediate and growing revenue streams and offsets the
cost of technology development for full scale cell production of SCS cell-based
therapeutics.

For further information on the company please visit:
www.stemcellsciences.com





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