Operational Milestone OM#B

• In 3Q16, the Data Monitoring Committee (DMC) for the SCiSTAR clinical study granted clearance to begin dosing a cohort of AIS-A patients with the highest planned dose of 20 million AST-OPC1 cells. The decision was based on the DMC’s independent safety review of data from the 2 million cell and 10 million cell AIS-A cohorts. On November 3, 2016, Asterias successfully dosed the first AIS-A patient with 20 million cells of AST-OPC1. No serious adverse events related to AST-OPC1 have been observed in any treated patient to date.

• Enrollment in the 5-subject AIS-A 10 million cell cohort was completed in July, 2016. In September, 2016, Asterias presented positive efficacy data from this cohort, including the following highlights:
o The efficacy target of 2 of 4 patients in the cohort achieving two motor levels of improvement on at least one side of their body had already been achieved by Day 90 of follow up: at this time point in followup, 4 of 4 patients dosed had improved motor function on at least one side and 2 patients had improved one motor level on at least one side, with one improving two motor levels on one side, and one improving two motor levels on both sides.
o The average upper extremity motor scores (UEMS) improvement at Day 90 for the 4 patients that had reached this follow up was 9.5 points compared to 5.0 points at Day 90 for patients dosed with 2 million cells, which may also begin to support a dose dependent response.
o As suggested by existing research, patients with complete cervical spinal cord injuries that show two motor levels of improvement on at least one side may regain the ability to perform daily activities such as feeding, dressing and bathing. Meaningful improvement in motor function, particularly in the use of a patient’s hands, fingers and arms, is critically important for a patient’s quality of life and ability to function independently. Consistent with their improvements in motor level and UEMS, subjects in the SCiSTAR study have demonstrated improvements in their ability to independently perform activities of daily living including feeding themselves, drinking, texting, sending emails, and signing their names.