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March 24, 2020 24 March, 2020

Sernova Provides Corporate Update and Outlook for 2020

March 24, 2020 9:00 a.m. EDT

LONDON, ONTARIO – March 24, 2020 – Sernova Corp. (TSX-V:SVA)(OTCQB:SEOVF)(FSE:PSH), a clinical- stage regenerative medicine therapeutics company, today provided a corporate update and outlook for 2020.

Dr. Philip Toleikis, President and CEO of Sernova Corp., remarked, "The past year has been one of significant advancement and success for Sernova's clinical and preclinical programs. We are pleased with the progress, including increased patient enrollment and early observations from our US Phase I/II clinical trial for people with type 1 diabetes and severe hypoglycemia unawareness. Advancements have also been made with preclinical initiatives for our Cell Pouch System™ platform relating to the development of stem cell-derived islets toward the ultimate goal of developing an unlimited source of therapeutic cells for diabetes, factor VIII producing cells for hemophilia A and a novel treatment for people with hypothyroid disease. We also continue to evolve and make progress with our pharma and academic collaborations. Despite the current COVID-19 environment, we are encouraged with the path ahead for Sernova and what we expect to achieve in 2020 to enhance long-term shareholder value."

The following enumerates recent progress and achievements for Sernova's pipeline by therapeutic indication and area of interest.

Diabetes

We are currently conducting a US Phase I/II clinical trial in type 1 diabetic patients with severe hypoglycemia unawareness – entitled "Safety, Tolerability and Efficacy Study of Sernova's Cell Pouch™ for Clinical Islet Transplantation" - at the University of Chicago ("US Phase I/II Cell Pouch Clinical Trial").

Key requirements for a successful diabetes regenerative medicine approach have been our focus, more specifically, these include first ensuring robust survival of insulin-producing cells within our Cell Pouch and proof of insulin release into the bloodstream in subjects with no ability to produce insulin prior to Cell Pouch transplant.

The following represents significant achievements for the US Phase I/II Cell Pouch Clinical Trial:

• Increased number of patients enrolled and transplanted in our clinical trial. In the most advanced patient treated with the Cell Pouch and insulin-producing islets, abundant and surviving vascularized insulin-producing islets were confirmed in the sentinel Cell Pouch by independent pathologist assessment following 90 days transplant.

 Why is this important? This early efficacy endpoint within the sentinel Cell Pouch is an indicator of transplanted islet health in the therapeutic Cell Pouches remaining in the patient, including the islets ability to read blood sugar and produce insulin into the bloodstream.

• Enduring bloodstream levels of insulin from the Cell Pouch transplanted islet cells in the fasting patient was shown through detection of C-peptide, a biomarker of insulin produced by the islet cells.

 Why is this important? This finding, combined with glucose-stimulated C-peptide and other early efficacy indicators observed, is an indication of a normalizing response by the Cell Pouch therapeutic cells to the body's varied need for insulin production, i.e. an indicator and evidence of ongoing islet survival within the vascularized environment of the Cell Pouch.

• The independent Data Safety Monitoring Board (DSMB) completed its first review of our US Phase I/II Cell Pouch Clinical Trial. No safety concerns were raised, and continuation of the clinical study was recommended.

 Why is this important? Independent DSMB review of the trial on a yearly basis in compliance with FDA guidelines and confirmation of favorable safety profile of the Cell Pouch and islets.

Hemophilia A

• The HemAcure Consortium, a collaboration including Sernova and a team of European academic investigators that received €5.6M funding from the EU Horizon 2020 program, successfully completed its objective to research and develop a therapeutic approach that would provide constant delivery of factor VIII to normalize blood levels in an effort to significantly improve the quality of life of patients suffering from hemophilia A.

• A series of breakthroughs were achieved demonstrating success in correcting cells from the blood of patients with hemophilia A to produce the required factor VIII protein within the implanted Cell Pouch resulting in improvement in blood clotting in an animal model of hemophilia A in preparation for future completion of formal preclinical studies and potential advancement to human clinical trials. Hypothyroid Disease

• Sernova has established a collaboration with Dr. Sam Wiseman of the University of British Columbia for development of a novel Cell Pouch Cell Therapy approach with the goal to reverse the serious effects of hypothyroidism, which occurs following removal of the thyroid gland in over 150,000 patients each year in the US.

• This collaboration, supported by Sernova and a Transplant Research Foundation (TRF) of British Columbia Transplant Venture grant award, has made important advancements, and study results are anticipated for release in 2020.

Local Immune Protection Technologies

• Local immune protection of therapeutic cells within the Cell Pouch would represent a major advance in cell therapy as it would reduce or eliminate the need for immunosuppression drugs and reduce both the potential of side effects and risk profile for cell therapy patients.

• We are continuing to evaluate local immune protection approaches with the objective of providing locally immune protected therapeutic cells within our Cell Pouch to improve current cell therapy treatment options.

Collaborations

• Sernova's current collaborations with leading pharma, medtech, and academic researchers are progressing according to plan. We continue to field collaboration inquiries from other international and large regional pharma companies.

• Current collaborations include the assessment of safety and efficacy of combined technologies in preclinical studies, which could lead to strategic development or commercial partnership opportunities for diabetes and our other platform technologies.

2020 Outlook

Some of our key initiatives for 2020 include:

• Focusing on patient enrollment completion which includes Cell Pouch implantation and the continued advancement of our US Phase I/II Cell Pouch Clinical Trial;

• Evolving stem cell-derived islet technologies, with the end goal to provide an unlimited supply of stem cell-derived islet cells for the anticipated treatment of any person inflicted with insulin-dependent diabetes;

• Continuing the evaluation of alternative novel local immune protection technologies for therapeutic cells, to be used in conjunction with our Cell Pouch technologies, for potential in-licensing or acquisition;

• Advancing further IND enabling preclinical proof of concept studies for the treatment of postoperative hypothyroid disease;

• Developing additional collaborations with pharma companies; and

• Releasing results of our research through publications in peer-reviewed scientific journals and conferences.

"While COVID-19 has introduced uncertainties for all people and businesses worldwide, we are proactively evolving how we operate and are adopting alternative methods and approaches to enable us to carry on our business and the US Phase I/II Cell Pouch Clinical Trial with the goal of mitigating potential impact. We are also continuing to advance our scientific, clinical and business activities within the context of the COVID-19 situation and are committed to following the evolving guidelines recommended by WHO, CDC, and the Federal and Provincial Governments of Canada to protect the safety of our employees and families, collaborators and business partners," said Dr. Philip Toleikis. He continued, "Despite the current environment, we are focused and committed to build upon our recent clinical and preclinical program achievements towards further important advancements in 2020 to deliver long-term value to our shareholders."

ABOUT SERNOVA'S CLINICAL TRIAL

Sernova is conducting a Phase I/II non-randomized, unblinded, single-arm, company-sponsored trial to assess the safety and tolerability of islet transplantation into the company's patented Cell Pouch in participants with diabetes and hypoglycemia unawareness. The secondary objective is to assess efficacy through a series of defined measures. Importantly, patients enrolled in Sernova's clinical trial are incapable of producing C- peptide, a marker of insulin produced by islet cells prior to implantation of Sernova's Cell Pouch and therapeutic cells.

Eligible subjects are implanted with Cell Pouches. Following the development of vascularized tissue chambers within the Cell Pouch, subjects are then stabilized on immunosuppression and a dose of purified islets, under strict release criteria, transplanted into the Cell Pouch.

A sentinel pouch is removed for an early assessment of the islet transplant. Subjects are followed for additional safety and efficacy measures for approximately six months. At this point, a decision is made with regards to the transplant of a second islet dose with subsequent safety and efficacy follow up. Patients are then further followed for one year to assess longer term safety and efficacy.

For more information on this clinical trial, please visit www.clinicaltrials.gov/ct2/show/NCT03513939. For more information on enrollment and recruitment details, please visit www.pwitkowski.org/sernova.

ABOUT SERNOVA'S CELL POUCH SYSTEM

The Cell Pouch as part of the Cell Pouch System is a novel, proprietary, scalable, implantable macro- encapsulation device solution designed for the long-term survival and function of therapeutic cells. The device upon implantation is designed to incorporate with tissue, forming highly vascularized tissue chambers for the transplantation and function of therapeutic cells which then release proteins and hormones as required to treat disease. The Cell Pouch along with therapeutic cells has been shown to provide long-term safety and efficacy in small and large animal models of diabetes and has been proven to provide a biologically compatible environment for insulin-producing cells in humans.

ABOUT SERNOVA CORP.

Sernova Corp is developing regenerative medicine therapeutic technologies using a medical device and immune protected therapeutic cells, i.e. human donor cells, corrected human cells and stem cell derived cells, to improve the treatment and quality of life of people with chronic metabolic diseases such as insulin- dependent diabetes, blood disorders including hemophilia, and other diseases treated through replacement of proteins or hormones missing or in short supply within the body. For more information, please visit www.sernova.com

FOR FURTHER INFORMATION, PLEASE CONTACT:

Dominic Gray Sernova Corp Tel: (519) 858-5126 dominic.gray@sernova.com www.sernova.com

FORWARD-LOOKING INFORMATION

This release contains statements that, to the extent they are not recitations of historical facts, may constitute "forward-looking statements" that involve various risks, uncertainties and assumptions, including, without limitation, statements regarding the future prospects, plans and objectives of the company. Wherever possible, but not always, words such as "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "potential for" and similar expressions, or that events or conditions "will", "would", "may", "could" or "should" occur are used to identify forward-looking statements. These statements reflect management's beliefs with respect to future events and are based on information currently available to management on the date such statements were made. Many factors could cause Sernova's actual results, performances or achievements to not be as anticipated, estimated or intended or to differ materially from those expressed or implied by the forward-looking statements contained in this news release. Such factors could include, but are not limited to, the company's ability to secure additional financing and licensing arrangements on reasonable terms, or at all; ability to conduct all required preclinical and clinical studies for the company's Cell Pouch System and/or related technologies, including the timing and results of those trials; ability to obtain all necessary regulatory approvals, or on a timely basis; ability to in-license additional complementary technologies; ability to execute its business strategy and successfully compete in the market; and the inherent risks associated with development of biotechnology combination products generally. Many of the factors are beyond our control, including those caused by, related to or impacted by the novel coronavirus pandemic. Investors should consult the company's quarterly and annual filings available on www.sedar.com for additional information on risks and uncertainties relating to the forward-looking statements. Sernova expressly disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.