Cellect Biotechnology Provides Corporate Update and Reports Fourth Quarter and Full Year 2017 Financial Results

TEL AVIV, Israel, March 19, 2018 /PRNewswire/ --Cellect Biotechnology Ltd. (NASDAQ: APOP), a developer of innovative technology which enables the functional selection of stem cells, today provided a corporate update and announced financial results for the fourth quarter and full year ended December 31, 2017.

"We are very pleased with our accomplishments in the fourth quarter and the full year of 2017," said Dr. Shai Yarkoni, Chief Executive Officer.

"During the fourth quarter, the Company reported positive results from a 20 patient trial with Tel-Aviv Ichilov Medical Center, in which ApoGraft™ significantly improved stem cells derived from fat tissues and the Company announced that Company CEO, Dr. Shai Yarkoni, was chosen to present Cellect technology and recent advancements at the Bio-Europe 2017 conference in Berlin.

"Overall, during 2017, the Company announced the treatment of the first blood cancer patient in its ongoing Phase I/II trial of the Company's stem cell technology ApoGraft™ and the successful performance of the procedure using the Company's ApoGraft™ technology; received a notice of allowance on a key method of treatment patent (Application No. 13/811,374) from the United States Patent & Trademark Office; announced positive final results from the non-interventional clinical trial of ApoGraft™ in healthy donors (104 donor test base); announced that Michael Berelowitz MD., former head, Clinical Development and Medical Affairs, Pfizer Specialty Care Business Unit, joined Cellect's board of directors; announced that Dr. Corey Cutler, Senior Physician at the world-renowned U.S. Dana Farber Cancer Institute and an Associate Professor of Medicine at Harvard Medical School, joined the Company's Scientific and Medical Advisory Board; announced the U.S. Food & Drug Administration (FDA) provided Cellect with pre-Investigational New Drug (IND) meeting minutes supporting an IND submission in the U.S. for Cellect's flagship product, ApoGraft™; the Company received a formal notice of Intention to Grant for a patent (Application No. 11751949.6-1466) covering a key method of treatment from the European Patent Office; the Company received a formal notice of allowance for a patent (Application No. 14/383,288) covering a key composition of matter and method of use from the US Patent & Trademark Office (USPTO); further to the notices of allowance received from the USPTO, the Company received further confirmation for grant of its patent by the Russian patent authorities (Application No. 2014138001) for a key composition of matter and method of use covering various devices using the ApoGraft™ for selection of stem cells; announced that the FDA granted Orphan Drug Status to Cellect's ApoGraft™ for Acute GvHD and Chronic GvHD; announced a $4.3 million raise in a registered direct offering; completed its voluntary de-listing from the Tel Aviv Stock Exchange" continued Dr. Yarkoni.

"We believe Cellect's transformative approach to cell selection represents a significant breakthrough in the ability to achieve much better stem cell preparation, for whatever use. Production of enriched stem cells material with substantially reduced mature immune cells has shown a great promise for reducing the significant risks associated with bone marrow transplantation", continued Dr. Yarkoni. "With this continued development progress, and our two registered direct offerings, Cellect is focused on creating long-term value for our shareholders."

Recent corporate highlights:

• the Company announced the results of the first group of patients in the Company's ongoing Phase I/II clinical trial of ApoGraft™ after one month follow-up with 100% acceptance of the stem cell transplant and zero related adverse events,
• the Company announced the opening of a second clinical trial site at Hadassah Medical Center for the Company's ongoing Phase I/II clinical trial of ApoGraft™ and that it received the approval from the Data and Safety Monitoring Board (DSMB) for dose escalation in the clinical trial,
• David Braun, Head of Merck Group's Medical Device Business, joined Cellect's Board of Directors, and
• the Company announced a $4 million registered direct offering.

Fourth Quarter and Full Year 2017 Financial Results:

• Research and development (R&D) expenses for the fourth quarter and for the full year of 2017 were $0.98 million and $3.32 million respectively, compared to $0.73 million in the fourth quarter of 2016 and $2.38 million for the full year of 2016. The increase in R&D expenses for the full year of 2017 as compared to the full year of 2016 was primarily attributable to an increase from share based payment, salaries and related personnel expenses reflecting the growth in the Company's activities resulting from an increase in the number of employees engaged in research and development related activities from thirteen to eighteen.
• General and administrative (G&A) expenses for the fourth quarter and for the full year of 2017 were $0.98 million and $3.73 million respectively, compared to $0.50 million in the fourth quarter of 2016 and $2.30 million for the full year of 2016. The increase in G&A expenses for the full year of 2017 as compared to the full year of 2016 was primarily due to professional services, share based compensation and expenses related to business development activities.
• Finance income, net for the fourth quarter of 2017 were $0.99 million, and finance expenses, net for the full year of 2017 were $1.09 million, compared to net finance income, net of $0.39 million in the fourth quarter of 2016 and $0.18 million for the full year of 2016 respectively. The financial expenses, net in the full year of 2017 as compared to the financial income, net in the full year of 2016, was primarily due to the change in the fair value of the listed warrants granted in the Company's initial public offering in 2016 and the unregistered warrants granted in the Company's registered direct offering in 2017.
• Net loss for the fourth quarter and for the full year of 2017 was $0.97 million and $8.14 million respectively, or $0.008 per share for the fourth quarter and $0.073 per share for the year of 2017 respectively, compared to $0.83 million, or $0.008 per share, in the fourth quarter and $4.41 million, or $0.049 per share for the full year of 2016.

Balance Sheet Highlights:

• Cash and cash equivalents (including marketable securities and short terms deposits) totaled $8.0 million as of December 31, 2017, compared to $9.4 million on September 30, 2017, and $8.9 million as of December 31, 2016. The change in the cash and cash equivalents was primarily due to net proceeds of $4.0 million (after deducting underwriters' fees) raised through a registered direct offering completed in September 2017, offset by cash used in operations during the year.
• Shareholders' equity totaled $5.4 million as of December 31, 2017, compared to $6.0 million on September 30 2017, and $8.2 million as of December 31, 2016.

For the convenience of the reader, the amounts have been translated from NIS into U.S. dollars, at the representative rate of exchange as of December 31, 2017 (U.S. $1 = NIS 3.467).