Greetings,

You no doubt saw the news on Friday that the “Sherley v. Sebelius” lawsuit opposing federal funding of human embryonic stem cell (hESC) research has been thrown out by a U.S. Appeals court.  We commend the three judge panel that issued this ruling. In our view this case was utterly without merit, and we are pleased to see it finally come to an end after winding its way through various challenges and appeals.

The ruling clears away the last known obstacle for the National Institutes of Health (NIH) in terms of federal funding of hESC research, and as such should be a boon for the field of regenerative medicine. Additionally, it can only be good for ACT’s programs. While we are not, and never have been, dependent on government funding, we have a number of hESC lines under consideration for funding by the NIH. With this ruling, the speed bumps for such approvals have finally been removed and we hope and expect to see the rate of funding approval for hESC lines, including ours, accelerate significantly in coming months.

Judge Brown’s Insightful Commentary

We would also like to recognize, in particular, Judge Janice Rogers Brown, a member of the three judge panel, for her  comments on the case regarding the Dickey-Wicker amendment, a rider on a 1996 Congressional appropriations bill. This case revolved around the interpretation of this amendment, and Judge Brown wrote the following on it:

The challenging—and constantly evolving—issues presented by bioethics are critical and complex. Striking the right balance is not easy and not, in the first instance, a task for judges[…] Given the weighty interests at stake in this encounter between science and ethics, relying on an increasingly Delphic, decade-old single paragraph rider on an appropriations bill hardly seems adequate.

We agree with Judge Brown’s statement, including her implied admonishment to Congress to clear up the wording and intent of the Dickey-Wicker amendment. As she wrote, given the gravity of this issue, it’s simply not adequate to rely on a single-paragraph rider on an old appropriations bill. What’s needed, in ACT’s view, is actual pro-hESC funding legislation.

Misunderstandings and Overheated Political Rhetoric

It never ceases to amaze me that, so many years after the first embryonic stem cell line was derived back in 1998, how many myths and misunderstandings about hESC research continue to make their way into public discussion about the field. For example, many people think that in order to derive embryonic stem cells, embryos must be destroyed, again and again. The last time ACT obtained an embryonic stem cell line was from 2005, and we do not anticipate needing to ever do so again.

It is clear from much of the rhetoric we’re hearing this political season, however, that very few people understand how hESC research as a whole really works, and why ACT’s single-cell blastomere program, in particular, should have truly broad appeal across the political spectrum. For it is the only method that I am aware of for deriving embryonic stem cells that is truly “embryo-safe,” i.e. does not require the destruction of the embryo. There is a big premium on educating political, religious, community and thought leaders on this patented, proprietary, and revolutionary method of non-destructive hESC creation.

hESCs, Adult and induced Pluripotent Stem Cells

As you no doubt are aware, aside from embryonic, various companies and organizations are developing potential treatments using adult and induced pluripotent stem (iPS) cells.

In terms of hESCs as compared with adult stem cells, our scientific team has observed, intererestingly, that our hESCs seem to have more robust therapeutic potential than adult stem cells.

There is also a lot of excitement around the potential promise of induced pluripotent (iPS) cells, and ACT is also a leader in this nascent field of research and development. Last year Stanford School of Medicine Bioethicist Christopher Scott published thoughtful research showing that limiting hESC research also likely slow iPS-related research. Far from being rival fields of research, the two are intertwined, and removing the ambiguity around funding of hESC research could prove to be a boon for both.

In Conclusion

Rather than rest on their laurels with respect to this issue, though, it is our sincere hope that in coming weeks and months, legislators will work to address any lingering ambiguity with respect to federal funding of hESC research. Given regenerative medicine’s vast potential promise to alleviate human suffering, nothing less than new funding legislation is called for, and we are confident that legislators will rise to the occasion.

In the meantime, we continue to move full speed ahead with our three hESC-based human clinical trials for forms of macular degeneration, and our other programs, and are eagerly anticipating NIH funding approval of our hESC lines.

Thank you.

Gary Rabin
Chairman and CEO
Advanced Cell Technology, Inc.

Forward-Looking Statements

Statements in this news release regarding future financial and operating results, future growth in research and development programs, potential applications of our technology, opportunities for the company and any other statements about the future expectations, beliefs, goals, plans, or prospects expressed by management constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements that are not statements of historical fact (including statements containing the words “will,” “believes,” “plans,” “anticipates,” “expects,” “estimates,” and similar expressions) should also be considered to be forward-looking statements. There are a number of important factors that could cause actual results or events to differ materially from those indicated by such forward-looking statements, including: limited operating history, need for future capital, risks inherent in the development and commercialization of potential products, protection of our intellectual property, and economic conditions generally. Additional information on potential factors that could affect our results and other risks and uncertainties are detailed from time to time in the company’s periodic reports, including the report on Form 10-K for the year ended December 31, 2011.  Forward-looking statements are based on the beliefs, opinions, and expectations of the company’s management at the time they are made, and the company does not assume any obligation to update its forward-looking statements if those beliefs, opinions, expectations, or other circumstances should change. Forward-looking statements are based on the beliefs, opinions, and expectations of the company’s management at the time they are made, and the company does not assume any obligation to update its forward-looking statements if those beliefs, opinions, expectations, or other circumstances should change. There can be no assurance that the Company’s clinical trials will be successful.