Living Cell Technologies Receives Ethics Approval for DiabeCell(R) Phase I/IIa C

DiabeCell® is a porcine islet cell product for thetreatment of type I(insulin-dependent) diabetes. The pig cells are injectedinto theperitoneal cavity to produce insulin and help regulate bloodglucose levelsappropriate to the amount of glucose detected in the bloodstream of thediabetic recipient. DiabeCell® has been uniquely developedto eliminatethe need for immunosuppression. The natural cells are coatedin aproprietary alginate gel that forms a tiny capsule aroundthe cells andprevents the patient's immune system from destroying thetransplant.

"Intra-peritoneal islet cell transplantation has the potentialto improvetype 1 diabetes mellitus and ultimately prevent the lifeshorteningconsequences of chronic diabetes, which cannot be achievedby conventionalinsulin treatments," said Living Cell Medical Director,Professor BobElliott. "The global market for type 1 diabetes is estimatedat 24 millionpeople."

LCT intends to conduct the New Zealand Phase I/IIa clinicaltrial of itsDiabeCell® product on eight long-standing type 1 (insulin-dependent)diabetics. The clinical trial is expected to be approximately12 months induration. The trial will be conducted at a New Zealand hospitalandinvolves the simple injection of encapsulated islets intothe abdomen ofthe diabetic patients. It is anticipated that the trialwill start in late2007 and will then be followed by a larger pivotal trial.

Undertaken over the last nine months, the full ethics reviewincludedassessment by international experts across ethical and culturalconsiderations, safety, public health and scientific data.MedSafe (the NZregulator), the Gene Technology Advisory Committee (GTAC)and the regionalethics committee have all advised the New Zealand Ministerfor Health oftheir approval for the clinical trial to proceed. The Minister'sformalapproval of Living Cell's request to commence the PhaseI/IIa clinicaltrial is expected within the next few weeks.

The ethics committee considered key areas such as adequatepatient consent,the potential contribution to knowledge and risk/benefitratio of thetrial, rare adverse events and LCT's unique system for managingpotentialperceived risk to the trial population. Judgement of riskhas been basedupon testing standards required by the US Food and DrugAdministration(FDA).

"LCT has worked closely with the regulatory authoritiesto establish theframework for conducting clinical trials with pig cellsto a newbenchmark. In doing so, LCT has built up considerable commercializationcapability and know-how that are essential for taking DiabeCell®to theclinic and market. We can now move forward in confidencethat our clinicaltrial strategy has undergone thorough assessment externally,"said Dr. PaulTan, Chief Executive Officer.

The Company's DiabeCell® product is currently in aPhase I/IIa clinicaltrial in Moscow in six type 1 (insulin-dependent) diabetics.Recipients inthis first trial are being given the lowest clinically effectivedose todemonstrate safety with dosing to be repeated for additionalclinicalbenefit. Follow up monitoring of these patients will continuefor 12months.

About Living Cell Technologies:

Living Cell is developing live cell therapy products totreat lifethreatening human diseases. The company owns a biocertifiedpig herd thatit uses as a source of cells for treating diabetes and neurologicaldisorders. For patients with type 1 diabetes, the companytransplantsmicroencapsulated islet cells so that near-normal bloodglucose levels maybe achieved without the need for administration of insulinor atsignificantly reduced levels. The company entered clinicaltrials for itsdiabetes product in 2007. For the treatment of Huntington'sdisease andother neurological disorders, the company transplants microencapsulatedchoroid plexus cells that deliver beneficial proteins andneurotrophicfactors to the brain. Living Cell also offers medical-gradeporcine-derived products for the repair and replacementof damaged tissues,as well as for research and other purposes.

LCT has a US American Depositary Receipt program, enablingUS residents topurchase LCT stock. To purchase ADRs in LCT, please contactyour broker(Other OTC: - ) (CUSIP Number: 53838R107). More informationaboutinvesting in the LCT ADR program can be obtained directlyfrom VioletPagan, Vice President Depositary Receipts at the Bank ofNew York, byemail: .

Background Information:

Scientific papers relating to DiabeCell® are availablefor download onthe LCT website at

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This document contains certain forward-looking statements,relating toLCT's business, which can be identified by the use of forward-lookingterminology, or by express or implied discussions regardingpotentialfilings or marketing approvals, or potential future salesof productcandidates. Such forward-looking statements involve knownand unknownrisks, uncertainties and other factors that may cause actualresults to bematerially different from any future results, performanceor achievementsexpressed or implied by such statements. In particular,management'sexpectations regarding the approval and commercializationof productcandidates could be affected by, among other things, unexpectedclinicaltrial results; unexpected regulatory actions or delays,or governmentregulation generally; our ability to obtain or maintainpatent or otherproprietary intellectual property protection; competitionin general;government, industry, and general public pricing pressures;and additionalfactors that involve significant risks and uncertaintiesabout ourproducts, product candidates, financial results and businessprospects.