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Medistem Laboratories Announces Positive Preclinical Results for MDS-786 Candidate

PHOENIX, AZ -- (MARKET WIRE) -- 06/29/07 -- Medistem Laboratories (OTCBB: MDSM) (FRANKFURT: S2U) announced today preclinical proof-of-concept studies demonstrating the positive potential of the company's MDS-786 candidate drug for lung cancer. The findings were presented at the 13th Annual Meeting of the International Society for Cellular Therapy that took place June 24-27, 2007 in Sydney, Australia. The presentation, entitled "Differentiation and Inhibition of Tumor Cells by Cord Blood Stem Cells" reviewed the ability of MDS-786 to induce a process called "differentiation" in which tumor cells are coaxed into transforming into non-tumor cells through the use of a placentally derived product.

Thomas Ichim, Medistem's Chief of Scientific Development and primary author of the paper, stated, "To date, treatment options for patients with lung cancer are primarily limited to highly toxic chemotherapy and radiotherapy approaches, which in many cases are not successful. Through harnessing molecular mechanisms that signal stem cell maturation in normal cells, we are inducing a process that drives malignant cells to convert into non-malignant cells." He continued, "The process of inducing malignant cells to transform into normal cells has been proven clinically as a viable treatment for cancer and is used in the treatment of patients with Acute Promyelocytic Leukemia. By applying such a process to solid tumors, we believe numerous therapeutic applications may exist that lack the toxicity of current approaches."

The National Cancer Institute estimates that over 10 million people are diagnosed with cancer annually. While there are some viable options today for treating some forms of cancer, Medistem is hopeful that MDS-786 can begin to address this dreaded disease in a non-toxic manner by allowing stem cells and the immune system to work in concert with one another to achieve homeostasis.

About Medistem Laboratories, Inc.

Medistem Laboratories is a biotechnology company that discovers, develops, and commercializes adult stem cell products that address serious medical conditions. While drug discovery and development is its primary focus, Medistem has compiled a body of proprietary technologies it outlicenses to commercial entities in markets where stem cell administration is permissible. Due to its licensee relationships and collaborative efforts with respected institutions, Medistem believes it is well positioned to be a leading developer of adult stem cell products.

Cautionary Statement

This document does not constitute an offer to sell or a solicitation of an offer to buy any of our securities. This document contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may include projections of matters that affect revenue, the ability to develop or license certain technologies; operating expenses or net earnings; projections of capital expenditures; projections of growth; hiring plans; plans for future operations; financing needs or plans; plans relating to the company's products and services; and assumptions relating to the foregoing.

Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. Future events and actual results could differ materially from those set forth in, contemplated by, or underlying the forward-looking information.

Some of the important factors that could cause the company's actual results to differ materially from those projected in forward-looking statements made by the company include, but are not limited to, the following: technology development limitations, intense competition, risk of business interruption, management of rapid growth, need for additional financing, regulatory approvals and requirements, dependence on key personnel and research, management and other administrative costs.

These factors are discussed in greater detail in the company's quarterly and annual periodic reports, all as filed with the Securities and Exchange Commission.


Medistem Laboratories, Inc.

Chris McGuinn



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