Re Agreement

Stem Cell Sciences plc 24 December 2007 Press Release Stem Cell Sciences Enters into Diabetes R&D Agreement with Major Pharmaceutical Company ("Stem Cell Sciences", "SCS") 24 December 2007 Cambridge, U.K. - Stem Cell Sciences plc (AIM: STEM, ASX: STC) the global biotechnology company focused on the commercialization of stem cells and stem cell technologies in research, today announced the signing of a contract research agreement with a major biopharmaceutical company. Under the terms of the agreement Stem Cell Sciences will validate its suite of cell processing technologies for the scaled, automated production of human embryonic stem cells (ES) and demonstrate the bulk production of cells relevant for diabetes research at the Company's Cambridge based production facility. Financial terms were not disclosed and the client company has requested anonymity. In addition to providing contract production services, Stem Cell Sciences will provide an option to an exclusive license for the use of its Rho kinase inhibitor technology (ROCKi) in the field of human ES production of cells for diabetes research. "We are delighted that our advanced, automated stem cell production is being validated by this deal. This agreement, which will focus on the proof of concept for production of cells for research purposes, is further recognition of our competence in the culture and manipulation of stem cells and we anticipate exciting opportunities in the future to further demonstrate compliance of the process for production of clinical grade cells," commented Dr. Alastair J. Riddell, Chief Executive Officer, Stem Cell Sciences. The program of work in the contract research agreement will utilise a number of Stem Cell Sciences' own human ES lines derived with regulatory approval and under license in their Melbourne based research facility at Monash University campus. Dr. Paul Bello, Research Program manager, who leads the team characterising the stem cell lines commented "The company has been working productively to develop a number of commercial reagents and processes for the improved isolation and growth of human ES cell lines and to close this agreement with a major biopharmaceutical company represents a satisfactory validation of our approach." Stem Cell Sciences intends to seek similar agreements in the future with biopharmaceutical companies as the field of stem cell-based therapeutics expands to include treatment for many degenerative diseases and for which a clean, safe, scalable production platform of cells will be a necessity. -Ends- - For further information, please contact: Stem Cell Sciences plc (United Kingdom) +44 1223 499161 Dr. Alastair Riddell, CEO Halsin Partners +44 207 084 5955 Mike Sinclair Stem Cell Sciences (Australia) pty ltd +61 3 9905 0600 Dr. Paul Bello, Research Program Manager Talk Biotech +61 422 206036 Fay Weston Stem Cell Sciences llc (USA) +1 415 495 7340 George Murphy, Vice President Business Development Notes to Editors 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), 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 This information is provided by RNS The company news service from the London Stock Exchange

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