Investor Presentation

May 2016

Safe Harbor

This presentation includes forward-looking statements that are made pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. While these statements are made to convey to the public the company’s progress, business opportunities and growth prospects, readers and listeners are cautioned that such forward-looking statements represent management's opinion. Whereas management believes such representation to be true and accurate, based on information and data available to the company at this time, actual results may differ materially from those described. The company's operations and business prospects are always subject to risk and uncertainties. Important factors that may cause actual results to differ are set forth in the company’s periodic filings with the US Securities and Exchange Commission.

To become the leading innovator, developer

and provider of therapeutics and diagnostics

for diabetes.

Islet Sciences - Our Mission

Investment Highlights

Multi-pronged strategy focused on prevention, early diagnosis and treatment of diabetes

Diabetes will have an impact on over half of Americans by 2020

Developing state of the art diagnostic system for early detection and intervention of diabetes - Based on proprietary patented technologies

Key partnerships established

Globally recognized management including former head of NIH

Experienced Management & Board John Steel

Chairman, CEO, Director

20+ years experience in healthcare services and biotechnology

Former CEO of MicroIslet, Inc.

Christian Mende, M.D.

Chief Scientific Officer

Clinical Professor of Medicine at University of California, San Diego

Fellow of the American College of Physicians, the American Society of Hypertension, Nutrition and Nephrology

Gary Wilder

COO, CFO

Finance and global corporate management in the biotech, technology and a variety of other industries

Bachelor of Science in Business Administration from the University of Southern California

Gary Blackburn

Director

Currently CEO of bioMeDx Advisors, a consulting firm he established in 2010. Previously Chief Executive Officer and Director of Claremont BioSolutions from 2010 through 2015, President and CEO of Ohmx Corporation, a protein diagnostics company, from 2005 to 2010.

B.S. degree in Chemistry, Ph.D. in Biomedical Engineering from the University of Utah, completed an NSF Postdoctoral Fellowship at Cornell University. Authored numerous publications in the fields of biosensors, immunoassay detection technologies and molecular diagnostics and is the inventor or co-inventor of more than 30 U.S. and foreign patents.

Gary Keeling

Director

Executive Vice President of Sales & Marketing & BOD Member for Eight Medical Corporation

BS in Economics from the University of Pittsburgh.

Gene Mannheimer, Director Healthcare IT & Services industry at Topeka Capital Markets

MBA in Finance from the University of Southern California and a dual BS in Economics and Systems Engineering from The Wharton School, University of Pennsylvania and Moore School of Electrical Engineering

Renowned Scientific Advisory Board Thomas J. Kindt, PhD

Chair

Dr. Kindt, has previously served as Chief Scientific Officer of Diomics Corp., of San Diego and InNexus Biotechnology.

For the past 11 years Dr. Kindt has served as an adjunct member of the Department of Biology at the University of New Mexico and authored a major textbook on immunology.

From 1995 to 2005, Dr. Kindt served as Director, Division of Intramural Research, NIAID, NIH, in Bethesda, Maryland, responsible for the management of the Division including 1,300 staff members, overseeing an annual budget of $340 Million, and 6 research facilities including Bethesda, Rockville and Frederick, Maryland.

Bachelor of Science in Chemistry (cum laude) from Thomas More College and Ph.D., in BioChemistry from the University of Illinois at Urbana–Champaign.

Kevan Herold, M.D.

Professor of Immunology and Medicine at Yale University

Jerry Nadler, M.D.

Professor & Chairman of Internal Medicine and Director of the Strelitz Diabetes Center at Eastern Virginia Medical School

Former Chief of Endocrinology at the University of Virginia

Steven Paraskevas, M.D. Ph.D. Transplant surgeon and Director of the Pancreas and Islet Transplant Program and of the Human Islet Isolation Laboratory at McGill University at McGill University

Christian Mende, M.D. Clinical Professor of Medicine at University of California, San Diego

Fellow of the American College of Physicians, the American Society of Hypertension, Nutrition and Nephrology

Strategic Partners

Academic & Grant Partners

Medical Need

Over half of Americans will have diabetes or will be pre diabetic

by 2020 at cost to U.S. healthcare system of $3.35 trillion(1)

• ~26 million Americans currently have diabetes (2)

• 79 million Americans are estimated to have pre diabetes(2)

• >$400 B total cost of diabetes in the U.S. in 2017(2)

~40% of diabetics are insulin dependent(2)

• Insulin injections do not address major complications of

insulin dependence especially kidney, heart, nerve and eye

disease

(1) Source: Reuters, UnitedHealth Group, Inc., Nov. 23, 2010

(2) Source: American Diabetes Association

Diabetes Attacks the Body in Multiple Ways

Hyperlipidemia

Hypertension

Hyperglycemia

Insulin Resistance

Hypercoagulable State

Inflammation

The Islet Sciences Path to a Cure

Early diagnosis by detecting damaged

and dying beta cells

Prevention by protecting new insulin

producing cells from immunological attack

• Preserve insulin producing cells in

newly diagnosed patients

Treatment by providing new insulin

producing cells

• Transplantation of encapsulated porcine

islets

• Regenerate patient’s cells

Human islet

protected by Lysofylline

Protection using Islet

Sciences alginate capsule

Novel method of

maturing viable porcine

islets

Initial Target Patients

Initially targeting end-stage renal disease (ESRD)

• Diabetes is leading cause of ESRD

• Causes 44% of new ESRD cases

100,000 new cases of ESRD reported annually

20-40% of Type 1 diabetics develop ESRD by age 50

• In the absence of adequate treatment by dialysis

or transplantation, these patients die

1,000,000 people currently living with kidney

transplant and diabetes

Early Diagnosis Through Detection of

Damaged and Dying Beta Cells

“A Needle in a Haystack”- Detecting β cell

DNA in the blood of prediabetic patients

With permission from Eitan Akirav PhD

β Cells

Pancreas Blood

Blood Detection

Current methods for measuring β cell death

Current evaluations of β cell mass rely on functional

assays (glucose tolerance test, c-peptide measurements,

glucose/insulin clamps)

β cell function may not provide a direct indication

regarding active β cells loss

Imaging of β cells/islets has proven difficult owing to

pancreas location and image resolution

Circulating β cell-derived factors may offer an

opportunity for detection of early β cell loss

β cell DNA is detected in primary islets and

primary insulin positive murine cells

Akirav et al., PNAS, 2011

Non obese Diabetic mouse is a spontaneous

model of human type 1 diabetes

DAPI Insulin CD31

NOD.SCID Prediabetic NOD Diabetic NOD

Akirav el al., Diabetes, 2011

Prediabetic NOD mice show a progressive

loss of glucose tolerance – NIH Funded

0

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0 15 30 60

Blo

od

glu

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/dL

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Akirav et al., PNAS, 2011

Circulating β cell DNA increases prior to

development of hyperglycemia

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betes

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0 5000 10000 15000 200000.0

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Insulin (ng/pancreas)

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eth

ylat

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exAkirav et al., PNAS, 2011

β cell death is detected in real time

Akirav and Lakey labs

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Pre injection 3 h 48 h 72 h

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tive a

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eta

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ze to

pre

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Gulcose Beta cell DNA

– Novel mDNA detection of b cell death

Kevan Harold, MD, PhD

Yale University, CT

β cell DNA is detected in human islets and sera of

recent onset insulin dependent diabetic patients

Akirav et al., PNAS, 2011

Expected Milestones

Corporate partnerships in place

FDA Phase 2 trials underway

Exploring accretive acquisitions

Protect and Preserve Insulin Producing Cells

Interleukin-12 : A Promising Target for Diabetes

IL-12:

• pro-inflammatory cytokine

• important for cell mediated immune responses such as type 1

diabetes and atherosclerosis

• Uses JAK/STAT4 signaling system to induce particular genes linked

to chronic inflammatory disorders

High glucose, Obesity and Diabetes markedly increase IL-12/STAT4

expression in key tissues

LSF & new oral analogs block activation of IL-12/STAT4 and preserve

islet function and viability

IL-12 is made directly in insulin producing beta cells of the pancreas

and can directly lead to reduced insulin secretion and cell death (2012

Publication)

LSF Reverses T1DM in NOD Mice

In Combo with Exendin-4

S.C. Medication Pump removed Day 28

N=9 mice/treatment group

Yang Z BBRC 2006 (344) 1017-1022 New grant for $250,000 from Iacocca Foundation to begin

to move this into the clinic

STAT-4 deficiency reduces atherosclerosis in 34 week-

old Apoe mice – Astra Zenaca/NIH Funded

female

male

IL-12 and Type 2 Diabetes

Lysofylline (LSF) Mechanism of Action

IL-12 activates key inflammatory pathway

IL-12

STAT4 STAT4 P-STAT4

Gene

expression

IL-12 receptor

Lysofylline (LSF)

Small molecule that blocks inflammatory actions of cytokines that destroy insulin-producing beta cells

Potential lead indications include:

• Adjunct therapy for islet cell (or other cellular) transplantation to reverse Type 1 diabetes

• Reversing or arresting progression of Type 1 diabetes, Latent Autoimmune Diabetes of Adults (LADA) and insulin-using Type 2 diabetes

• Treatment of diabetic nephropathy and diabetic retinopathy

Human islet cell being attacked by

inflammatory cytokines

LSF protects human islet cells

attacked by inflammatory proteins

LSF/Piglet islet co-culture study – NIH Funded, 2014

Piglet islets isolated and cultured for 8 days in ISM media

(37oC/5%C02), then encapsulated with 2.1% sodium alginate and

placed media with and without LSF (10 or 50um).

Encapsulated piglet islets were then culture for an additional 48

hours and evaluated for islet recovery.

400.00

450.00

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600.00

650.00

700.00

0 24 48

Isle

t Eq

uiv

alen

t

Hours in Culture

Control

10um LSF

50um LSF

Single dose of LSF Significantly Reduced IFNγ

IFNgMean and Standard Error

Column

A B

2,700

2,600

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0

* p<0.01

Legend

A = Pre LSF Dose

B = Post 24 hour LSF Dose

*

IFNγ (Interferon gamma), a key component in the cause of Type 1

diabetes, reduced by LSF in clinical trial* *Astra Zeneca, 2013

Lysofylline (LSF) Development In Process - Summary

Two open INDs

5 Phase I trials completed involving 51 healthy subjects

− LSF was well tolerated

− No subject experienced a serious adverse event

CMC package to FDA

Toxicology package for IND

Uses for athrosclerosis, diabetes and kidney disease

Combination LSF/GLP-1 (Glucagon-like peptide-1) underway

Treatment Through Transplantation of

Encapsulated Porcine Islets

Clear Benefits of Transplant Therapy

Extended kidney graft

and patient survival

Reduction of long-

term diabetes

complications

Lower long-term

healthcare costs

Quality of life

improvement 30

40

50

60

70

80

90

100

0 1 2 3 4 5 6

Pancreas & Kidney

Transplant *

Kidney Transplant

Plus Islet Therapy

Kidney Transplant

with Ongoing DM

Dialysis with

Ongoing DM

years

*1,000 performed annually

Source: CDC, 2011

Improved method of pig islet isolation and maturation

Islet Sciences

Piglet Islet Previous Porcine Islet

UC, NIH and JGRF, 2014

Diabetic C57BL/6 Mice Transplant

3,000 Encapsulated Islets (IEQ) – NIH, 2014

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Days Post Transplant (Days)

STZ

Txp

x x x x x

Average Insulin: Green Line, 1X = 1U Insulin

x

No Immunosuppression

2016 Expected Milestones

Develop Islet Sciences Infusion therapy for insulin

dependent patients with end stage renal disease (ESRD)

Establish infrastructure to provide scale and logistics for

clinical trials and commercialization

Develop LSF to block autoimmune damage to insulin-

producing cells

mDNA assay for detection/management of diabetes

Expand development and commercialization partnerships

Selectively acquire and develop complementary

technologies

Consolidated Balance Sheet

January 31, 2015 April 30, 2014

(Unaudited) (Audited)

ASSETS

CURRENT ASSETS

Cash $23,938 $1,141

Prepaid expenses 14,098 700

Security deposits 21,761 -

Total current assets 59,797 1,142,080

OTHER ASSETS

Fixed assets, net 5,284 -

Intangible asset (Note 3) 1,367,000 1,367,000

Goodwill (Note 3) 2,111,107 2,111,107

Total other assets 3,483,391 3,478,107

TOTAL ASSETS $3,543,188 $4,620,187

LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES

Accounts payable $3,536,284 $3,271,174

Accrued expenses 65,805 -

Accrued stock compensation expenses (Note 4) 142,177 433,346

Notes payable - related parties 53,212 91,641

Total current liabilities 3,797,478 3,796,161

Deferred income taxes 547,000 547,000

Total liabilities 4,344,478 4,343,161

Commitments and Contingencies (Note 5)

STOCKHOLDERS' EQUITY (DEFICIT)

Preferred stock, $0.001 par value, 10,000,000 shares authorized; no shares issued and outstanding at January 31, 2015 and April 30, 2014

- -

Common stock, $0.001 par value, 100,000,000 shares authorized; 66,928,724 and 67,516,253 shares issued and outstanding at January 31, 2015 and April 30, 2014, respectively

66,929 67,517

Additional paid-in capital 21,053,550 20,598,242

Accumulated deficit (21,921,769) (20,388,733)

Total stockholders' equity (deficit) (801,290) 277,026

TOTAL LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT)$ 3,543,188 $4,620,187

Key Takeaways

Multi-pronged strategy focused on prevention, early

diagnosis and treatment of diabetes

Diabetes will have an impact on over half of Americans

by 2020

Developing state of the art diagnostic system for early

detection and intervention of diabetes

− Based on proprietary patented technologies

Key partnerships established

Globally recognized management including former head

of NIH

Thank you for your attention!