Advanced Cell Technology reduces 2010 debt to less than $1 million

Mar 21 2011

Advanced Cell Technology, Inc. ("ACT"; OTC Bulletin Board: ACTC), a leader in the field of regenerative medicine, announced today 2010 year-end results for the period ended December 31, 2010. The Company utilized $8.8 million in cash for operations during the year, compared to $5.1 million in the year-earlier period. The increase in cash utilization resulted primarily from activities related to IND filings and approvals surrounding the Company's RPE programs. ACT ended the year with cash and cash equivalents of $15.9 million and less than $1 million of debt, compared to $2.5 million in cash and cash equivalents and $8.4 million of debt in the year-earlier period. Since September, 2009, the Company has eliminated more than $34 million in indebtedness, including $20 million of indebtedness and liabilities in the 2010 fourth quarter.

“2010 was a transformative year for the Company, as it received FDA clearance to commence two landmark human studies using a cell therapy derived from embryonic stem cells”

Some of the highlights of 2010 include:

Improved balance sheet. The Company substantially improved its balance sheet by eliminating approximately $8.2 million in convertible debentures. ACT also ended fiscal 2010 in the strongest financial condition in the Company's history, with sufficient cash to fund operations through mid-2012. The Company received an unqualified opinion, consistent with Generally Accepted Accounting Principles (GAAP), from its outside auditors.

Received Clearance to Commence Phase I/II trial in Stargardt's Macular Dystrophy. ACT received FDA clearance for its Investigational New Drug (IND) application to initiate a Phase I/II multicenter clinical trial using retinal cells derived from human embryonic stem cells (hESCs) to treat patients with Stargardt's Macular Dystrophy (SMD), one of the most common forms of juvenile macular degeneration in the world. The decision removed the clinical hold that the FDA had placed on the trial in late 2009 in order to complete their review.

Received Clearance to Commence Phase I/II Trial in Dry AMD. ACT received FDA clearance only 30 days after filing its IND application to treat Dry Age-Related Macular Degeneration (AMD) using retinal pigment epithelial (RPE) cells derived from hESCs. Dry AMD is the most common form of macular degeneration in the world. There are currently no treatments available for this prevalent disease of an aging global population. Dry AMD represents a substantial global market opportunity and afflicts between 10-15 million Americans, and as many Europeans.

Received Orphan Drug Designation from FDA. ACT was granted orphan drug designation for the company's hESC-derived hRPE cells for use in the treatment of SMD. As a result, the Company is eligible to receive a number of benefits, including tax credits, access to grant funding for clinical trials, accelerated FDA approval and allowance for marketing exclusivity after drug approval for a period of as long as seven years. The Company also received a Positive Opinion for Orphan Drug Designation from European Medicines Agency in March, 2011.

Received Controlling Patents for hESC-derived RPE cells. ACT was granted three U.S. Patents which together broadly cover the use manufacturing of human RPE cells from hESC lines, as well as the use of hESC-derived RPE cells for treating retinal degenerative diseases, including AMD and Stargardt's Disease. The company continues to make progress towards obtaining patent protection to cover its RPE program and product opportunities in Europe and other important jurisdictions.

Received Significant Financial Commitment from Institutional Investor. The Company entered into a $25 million non-convertible stock purchase agreement with Socius CG II, Ltd., a subsidiary of Socius Capital Group ("Socius"). Socius, based in New York and Los Angeles, has made investments in a number of emerging life sciences companies. To date, ACT has sold Socius $4 million of Preferred Stock.

"2010 was a transformative year for the Company, as it received FDA clearance to commence two landmark human studies using a cell therapy derived from embryonic stem cells," said Gary Rabin, ACT's interim Chairman and CEO. "While receiving these clearances represented a tremendous achievement for the Company, our ability to dramatically improve our balance sheet was equally important, as we now have the ability to complete these two trials without seeking additional capital. We believe that ACT has never been better positioned to develop its promising stem cell-based technologies."