Cytotherapy Report Confirms BioE Stem Cell First Human Cord Blood Stem Cell to Differentiate into Lung Cell.

BioE and University of Minnesota Extend Stem Cell Research Agreement to Further Evaluate MLPC to Treat Lung Injuries and Respiratory Disease

ST. PAUL, Minn. -- BioE([R]), Inc., a biomedical company providing human umbilical cord blood stem cells as enabling, high-quality cellular tools for drug discovery and therapeutic research, announced today a report published in the latest issue (Vol. 8, Issue 5) of the journal Cytotherapy confirms its Multi-Lineage Progenitor Cell([TM]) (MLPC([TM])) is the first human cord blood stem cell to differentiate into a type II alveolar lung cell.

Type II alveolar cells are responsible for secreting surfactant, a material that helps stabilize the lung's air sacs during respiration. The MLPC is a rare stem cell derived from human umbilical cord blood that was discovered by BioE and has shown the capacity to turn into multiple cell and tissue types.

"It's very encouraging to see a human cord blood stem cell exhibit the ability to turn into a type II alveolar cell," said David McKenna, M.D., principal investigator of the study, assistant professor of lab medicine and pathology and medical director of the University of Minnesota Medical Center, Fairview's Clinical Cell Therapy Lab, and BioE research collaborator. "Based on this research, it's quite possible the MLPC will have utility as a highly functional research tool for studying lung pathophysiology in a human model. We hope to translate this early success with the MLPC into future research breakthroughs that ultimately provide therapeutic benefits to patients suffering from lung injuries and respiratory disease."

As a result of the promising work published in Cytotherapy, the University of Minnesota and BioE recently entered into a joint research collaboration to further evaluate the use of the MLPC for creating airway epithelial cells, such as type II alveolar cells, that could aid in combating diseases such as emphysema and cystic fibrosis, as well as pulmonary injury due to therapy-related causes. Dr. McKenna and his team will lead this new research, which is expected to conclude in mid-2008. BioE and the University of Minnesota also are collaborating to commercialize this ongoing research and technology.

"The continued work of Dr. McKenna's lab and BioE is very exciting as it's the result of academia and industry coming together to explore ways to turn emerging stem cell research into tools that have the potential to one day influence patient outcomes," said Tim Mulcahy, Ph.D., vice president for research at the University of Minnesota. "We remain committed to partnering with business to positively impact society by transforming our faculty's life-changing research and discoveries into viable products that have potential to improve the quality of life of patients afflicted with debilitating diseases. The University looks forward to continuing our productive relationship with BioE and continuing to elevate Minnesota as a worldwide leader in stem cell research."

Additional Cytotherapy Study Details

To obtain the rare MLPC from cord blood, researchers at the University of Minnesota used BioE's specially formulated stem cell isolation technology Co PrepaCyte([R])-MLPC. Isolated MLPCs were then put into culture, allowed to expand and tested for key stem cell markers, which were exhibited. Researchers then differentiated the MLPC into cell types representative of the three germinal layers (e.g., ectoderm, mesoderm and endoderm) that give rise to the body's more complex tissues, organs and organ systems.

Typically, researchers confirm endodermal potential by differentiating a stem cell into hepatic (liver) cells. In this instance, University of Minnesota researchers were able to turn the MLPC into type II alveolar cells, which was confirmed by the presence of a definitive type II alveolar cell marker Co surfactant protein C (SPC). In previous studies, the MLPC demonstrated endodermal potential by differentiating into liver and pancreas precursor cells.

"It's reaffirming to receive validation through a peer-reviewed journal of our MLPC's unique differentiation characteristics Co in this case, its ability to turn into a critically important lung cell," said Michael Haider, president and chief executive officer for BioE. "This report is one of many proof points that verify the MLPC is leading a new category of highly functional stem cells derived from cord blood. We're also tremendously excited to extend our relationship with the University of Minnesota and Dr. McKenna's lab to further investigate how the MLPC can more easily advance the study of respiratory disease treatments."

The research paper is currently available online, and will be published in the Nov. 7, 2006, issue of Cytotherapy Co the official journal of the International Society for Cellular Therapy (ISCT). The paper's abstract can be found online at www.bioe.com.

About BioE

Headquartered in St. Paul, Minn., BioE is a biomedical company providing human cord blood stem cells as enabling, high-quality cellular tools for drug discovery and therapeutic research. The company's novel Multi-Lineage Progenitor Cell([TM]) (MLPC([TM])) Co derived from human umbilical cord blood and obtained using PrepaCyte([R]), the company's proprietary cell isolation platform Co provides clinicians and researchers a flexible, long-term and non-controversial tool for therapeutic research and drug discovery and screening. BioE is privately owned and was founded in 1993. For more information about the company, please visit www.bioe.com or call [phone].