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Press release content from Globe Newswire. The AP news staff was not involved in its creation.

International Stem Cell Corporation Announces 2018 Fourth Quarter and Year-End Results

April 15, 2019

CARLSBAD, Calif., April 15, 2019 (GLOBE NEWSWIRE) -- International Stem Cell Corporation (OTCQX: ISCO) ( www.internationalstemcell.com ) (“ISCO” or “the Company”), a California-based clinical stage biotechnology company developing novel stem cell-based therapies and biomedical products, today announced fourth quarter and year-end financial results for the period ending on December 31, 2018 and provided a business update.

“During 2018 we have made significant progress towards our business units’ work optimization while also managing to decrease operating cash burn by nearly fifty percent. In addition, we have been conducting the world’s first clinical trial of human parthenogenetic stem cells for the treatment of Parkinson’s disease.

We expect to build on the momentum from 2018 in the coming year and capitalize on growing the business while awaiting results from the clinical trial” - stated Andrey Semechkin, Ph.D., CEO and Co-Chairman of ISCO.

FY 2018 Financial highlights:

-- Revenues increased to $11.1 million in 2018 an increase of 49%, compared to $7.5 million in 2017; -- Combined operating income for the year ended December 31, 2018 from our two wholly owned revenue generating subsidiaries, Lifeline Cell Technology and Lifeline Skin Care, was $2.4 million, an increase of 71%, compared to 1.4 million in 2017; -- Average net cash used in operating activities (“cash burn”) was approximately $90,000 per month for the year ended December 31, 2018, a decrease of 50%, compared to $179,000 in 2017.

Recent Corporate Highlights

-- ISCO has been upgraded to trade on the OTCQX Best Market from OTCQB Venture Market; -- The United States Patent and Trademark Office (USPTO) has granted the Company a key US patent protecting its anti-aging business; -- 12-month results of the first cohort and six-month interim results of the second cohort of phase 1 clinical study were announced at the Society for Neuroscience annual meeting; -- Pre-clinical data for traumatic brain injury program was published in Theranostics, a prestigious peer-reviewed medical journal.

Presentations

In 2018, the Company presented positive interim results of its clinical trial in Parkinson’s disease at the following events:

-- The American Academy of Neurology Annual Meeting; -- The American Society for Neural Therapy and Repair Annual Meeting; -- The Society for Neuroscience Annual Meeting (Neuroscience 2018).

About International Stem Cell Corporation

International Stem Cell Corporation is focused on the therapeutic applications of human parthenogenetic stem cells (hpSCs) and the development and commercialization of cell-based research and cosmetic products. ISCO’s core technology, parthenogenesis, results in the creation of pluripotent human stem cells from unfertilized oocytes (eggs). hpSCs avoid ethical issues associated with the use or destruction of viable human embryos. ISCO scientists have created the first parthenogenetic, homozygous stem cell line that can be a source of therapeutic cells for hundreds of millions of individuals of differing genders, ages and racial background with minimal immune rejection after transplantation. hpSCs offer the potential to create the first true stem cell bank, UniStemCell™. ISCO also produces and markets specialized cells and growth media for therapeutic research worldwide through its subsidiary Lifeline Cell Technology ( www.lifelinecelltech.com ), and stem cell-based skin care products through its subsidiary Lifeline Skin Care ( www.lifelineskincare.com ).

For more information, please visit http://internationalstemcell.com/ or contact:

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Safe harbor statement

Statements pertaining to anticipated developments and company achievements, expected clinical studies (including timing and results), anticipated protection from patents, and other opportunities for the company and its subsidiaries, along with other statements about the future expectations, beliefs, goals, plans, or prospects expressed by management constitute forward-looking statements. Any statements that are not historical fact (including, but not limited to statements that contain words such as “will,” “believes,” “plans,” “anticipates,” “expects,” “estimates,”) should also be considered to be forward-looking statements. Forward-looking statements involve risks and uncertainties, including, without limitation, risks inherent in the development and/or commercialization of potential products, regulatory approvals, need and ability to obtain capital, application of capital resources among competing uses, and maintenance of intellectual property rights. Actual results may differ materially from the results anticipated in these forward-looking statements and as such should be evaluated together with the many uncertainties that affect the Company’s business, particularly those mentioned in the cautionary statements found in the Company’s Securities and Exchange Commission filings. The Company disclaims any intent or obligation to update forward-looking statements.

International Stem Cell Corporation and Subsidiaries Consolidated Balance Sheets (in thousands, except share data and par value)

December December 31, 31, 2018 2017 ---------- ---------- Assets Cash $ 1,075 $ 304 Accounts receivable, net of allowance for doubtful accounts of $12 651 465 Inventory, net 1,501 1,307 Prepaid expenses and other current assets 543 779 - -------- - -------- Total current assets 3,770 2,855 Non-current inventory 805 692 Property and equipment, net 469 321 Intangible assets, net 2,674 2,922 Deposits and other assets 78 74 - -------- - -------- Total assets $ 7,796 $ 6,864 - -------- - -------- Liabilities and Stockholders’ Equity Accounts payable $ 458 $ 830 Accrued liabilities 579 607 Related party payable 2,045 — Advances 250 250 Fair value of warrant liability 1,745 3,113 - -------- - -------- Total current liabilities 5,077 4,800 Long-term deferred rent 182 — - -------- - -------- Total liabilities 5,259 4,800 - -------- - -------- Commitments and contingencies (Note 10) Stockholders’ Equity Series B Convertible Preferred stock, $0.001 par value, 5,000,000 shares authorized, 250,000 issued and outstanding, with liquidation preferences of $411 — — and $396 at December 31, 2018 and 2017, respectively Series D Convertible Preferred stock, $0.001 par value, 50 shares authorized, 43 — — shares issued and outstanding, with liquidation preference of $4,320 Series G Convertible Preferred stock, $0.001 par value, 5,000,000 shares 5 5 authorized, issued and outstanding, with liquidation preference of $5,000 Series I-1 Convertible Preferred stock, $0.001 par value, 2,000 shares authorized, 814 and 1,304 issued and outstanding with liquidation preferences of $814 and — — $1,304 at December 31, 2018 and 2017, respectively Series I-2 Convertible Preferred stock, $0.001 par value, 4,310 shares authorized, — — issued and outstanding with liquidation preferences of $4,310 Common stock, $0.001 par value, 120,000,000 shares authorized, 6,933,861 and 6,057,132 shares issued and outstanding at December 31, 2018 and 2017, 7 6 respectively Additional paid-in capital 109,188 106,585 Accumulated deficit (106,663 ) (104,532 ) - -------- - -------- Total stockholders’ equity 2,537 2,064 - -------- - -------- Total liabilities and stockholders’ equity $ 7,796 $ 6,864 - -------- - --------

International Stem Cell Corporation and Subsidiaries Consolidated Statements of Operations (in thousands, except per share data)

Years Ended December 31, -------------------- 2018 2017 -------- -------- Revenues Product sales $ 11,089 $ 7,456 - ------ - ------ Total revenues 11,089 7,456 - ------ - ------ Expenses Cost of sales 4,069 2,122 Research and development 2,396 2,658 Selling and marketing 2,631 2,405 General and administrative 5,467 5,213 - ------ - ------ Total expenses 14,563 12,398 - ------ - ------ Loss from operations (3,474 ) (4,942 ) - ------ - ------ Other income (expense) Change in fair value of warrant liability 1,368 (1,068 ) Interest expense (48 ) (59 ) Miscellaneous income 44 — Miscellaneous expense (21 ) — - ------ - ------ Total other income (expense), net 1,343 (1,127 ) - ------ - ------ Loss before provision for income taxes (2,131 ) (6,069 ) Provision for income taxes — — - ------ - ------ Net loss $ (2,131 ) $ (6,069 ) - ------ - ------ Net loss applicable to common stockholders $ (2,131 ) $ (6,069 ) - ------ - ------ Net loss per common share-basic $ (0.33 ) $ (1.46 ) - ------ - ------ Net loss per common share-diluted $ (0.33 ) $ (1.46 ) - ------ - ------ Weighted average shares outstanding-basic 6,388 4,158 - ------ - ------ Weighted average shares outstanding-diluted 6,388 4,158 - ------ - ------

Contacts:

International Stem Cell CorporationRussell A. Kern, PhDPhone: 760-940-6383Email: ir@intlstemcell.com

Or

Joe GreenInvestor RelationsEdison Inc. jgreen@edisongroup.com +1 (646) 653-7030

Ethan WalfishInvestor RelationsEdison Inc. ewalfish@edisongroup.com +1 (646) 760-0321

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