Dr. Philip Toleikis reports

SERNOVA CORP ANNOUNCES FIRST PATIENT IMPLANTED WITH SERNOVA'S CELL POUCH IN A PHASE I/II US CLINICAL TRIAL FOR THE TREATMENT OF HYPOGLYCEMIA UNAWARENESS IN SUBJECTS WITH TYPE 1 DIABETES

Sernova Corp. has implanted the first patient with Sernova's Cell Pouch in the phase I/II clinical trial evaluating the safety and efficacy of Sernova's Cell Pouch for clinical islet transplantation in Type 1 diabetes.

"Islet transplantation has shown success as a therapeutic option for treating patients with hypoglycemia unawareness; the most unstable, high-risk form of Type 1 diabetes. Given the limited supply of donor islet cells, it is imperative to develop approaches that capitalize on a more efficient use of donor islet cells," said Dr. Piotr Witkowski, principal investigator and director of the pancreatic and islet transplant program at University of Chicago School of Medicine. "We believe Sernova's Cell Pouch creates a vascularized environment -- rich in microvessels that will allow robust engraftment and extended survival of the transplanted islet cells. We hope this will result in the need for fewer transplants per patient and, ultimately, create a long-term treatment option for patients suffering from hypoglycemic unawareness."

Cell Pouches, including small sentinel pouches, were implanted. Following development of the vascularized tissue chambers and stabilization on immune protection medications, the Cell Pouch will be transplanted with donor islet cells. Approximately 90 days after transplant, small sentinel devices are removed to evaluate islet survival as an initial efficacy end point.

"This important clinical milestone represents an exciting time at Sernova as we pursue safe, effective and innovative regenerative medicine treatments for patients with hypoglycemia unawareness in Type 1 diabetes," said Dr. Philip Toleikis, president and chief executive officer of Sernova. "We are confident this U.S. clinical trial will support and add important data to the positive preclinical results of our small and large diabetes animal models and our first-in-human trial with Health Canada. It will also contribute to the development of broader applications for the Cell Pouch, including our diabetes stem cell technologies and additional indications."

The company is expecting to report preliminary safety data from Sernova's clinical study in the first half of 2019 and preliminary efficacy data in the second half of 2019.

About the study

The approved protocol is a phase I/II non-randomized, unblinded, single-arm, company-sponsored trial, where diabetic subjects with hypoglycemia unawareness enroll into the study under informed consent. Participants are then implanted with Cell Pouches. Following the development of vascularized tissue chambers within the Cell Pouch, subjects are then stabilized on immunosuppression, and a dose of purified islets, under strict release criteria, is transplanted into the Cell Pouch.

A sentinel pouch will be removed for an early assessment of the islet transplant. Subjects will be followed for additional safety and efficacy measures for approximately six months. At this point, a decision will be made with regard to the transplant of a second islet dose with subsequent safety and efficacy follow-up. Patients will then be further followed for one year. The primary objective of the study is to demonstrate safety and tolerability of islet transplantation into the Cell Pouch. The secondary objective is to assess efficacy through a series of defined measures.

About hypoglycemia unawareness and diabetes

Type 1 diabetes is a chronic disease that affects more than 42.5 million globally, in which the body's immune system attacks and destroys the pancreatic cells that produce insulin, an essential hormone to help the body use glucose. To date, there is no cure for Type 1 diabetes, and people living with the disease are dependent on insulin therapy, an imperfect treatment method that requires careful monitoring throughout the day, along with multiple calculated doses of insulin, to help regulate their blood sugar levels. A miscalculation or unexpected variable leading to high- or low-blood-sugar episodes are daily threats, and only a third of people with Type 1 diabetes achieve their long-term blood glucose targets, placing them at risk for Type 1 diabetes-related health complications. Hypoglycemia unawareness, a subset of diabetes in which individuals experience a critical drop in blood sugar without warning symptoms, represents more than 15 per cent of the Type 1 diabetes population.

About the Cell Pouch

The Cell Pouch is a novel, proprietary, scalable, implantable macroencapsulation device designed for the long-term survival and function of therapeutic cells. The device is designed to incorporate with tissue, forming highly vascularized tissue chambers for the transplantation and function of therapeutic cells which then release proteins and hormones as required to treat disease. The device, along with therapeutic cells, has been shown to provide long-term safety and efficacy in small and large animal models of diabetes and has been proven to provide a biologically compatible environment for insulin-producing cells in humans.

About Sernova Corp.

Sernova is developing regenerative medicine therapeutic technologies using a medical device and immune-protected therapeutic cells (such as human donor cells, corrected human cells and stem-cell-derived cells) to improve the treatment and quality of life of people with chronic metabolic diseases such as insulin-dependent diabetes, blood disorders including hemophilia, and other diseases treated through replacement of proteins or hormones missing or in short supply within the body.

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