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                                                                    Exhibit 99.1


              AASTROM BIOSCIENCES ANNOUNCES DIABETIC LIMB ISCHEMIA

                            CLINICAL TRIAL AGREEMENT

  -- Aastrom's Proprietary TRCs to be Used in Treatment of Limb Ischemia at the
             Bad Oeynhausen Heart and Diabetes Center in Germany --

ANN ARBOR, MICHIGAN, OCTOBER 28, 2004 -- Aastrom Biosciences, Inc. (NasdaqSC:
ASTM) announced today that it has signed a clinical trial agreement with the
Heart and Diabetes Center North Rhine-Westphalia (Center), located in Bad
Oeynhausen, Germany. The clinical trial, which has also now received local
Ethical Committee approval, will evaluate the safety and effect of Aastrom's
Tissue Repair Cells (TRCs) in the regeneration of peripheral vascular tissue to
treat lower limb ischemia in diabetic patients. The Principal Investigator for
the study is Prof. Dr. Diethelm Tschoepe, Clinic Director at the Center.

This multi-arm feasibility trial will evaluate patients treated with TRCs
produced from a sample of their own bone marrow, in comparison to patients
treated with an equivalent sample of only their own bone marrow, and to patients
receiving the standard of care treatment. For the Aastrom TRC and bone marrow
treatments, two different routes of administration will be evaluated. The study
can accrue up to 50 patients, who will be randomly divided among the different
arms of the trial. Endpoints to be studied include improvements in
vascularization and the healing of skin ulcers, as well as recovery of the
ability to walk, limb salvage and reduced mortality. Aastrom expects the
clinical trial to begin accruing patients by mid-calendar year 2005.

"This new trial is exciting and important for our Company in several ways. Limb
ischemia is a major medical problem facing diabetics, for which the medical
community is continually seeking more effective therapy. Aastrom's bone marrow
adult stem cell TRC product may offer an innovative, alternative approach to the
care of these patients," said R. Douglas Armstrong, Ph.D., Chairman and Chief
Executive Officer of Aastrom. "Aastrom's TRCs are currently being studied in
feasibility clinical trials for their ability to promote the regeneration of
bone in fracture healing and sinus lift procedures. This new limb ischemia study
represents another milestone in our strategic plan to develop multiple
applications within regenerative medicine, from the same core technology and
operational infrastructure. We are very pleased to be working with Prof. Dr.
Tschoepe and his excellent clinical staff at the Bad Oeynhausen Heart and
Diabetes Center."

ABOUT LIMB ISCHEMIA

Ischemia is a blood circulation deficiency in an organ or tissue caused by
constriction or obstruction of its blood vessels, and is commonly associated
with diabetes and Buerger's disease, as well as other diseases. Small artery
obstruction is a major contributor to stroke, heart disease, deep ulcers of the
feet, loss of limb function and limb amputation. For certain severe limb
ischemic situations, current surgical intervention methodologies have been
proven ineffective in the long-term management

of the problem. As a result, the medical and research communities have recently
turned to the development of cell-based and other therapies as alternative
treatments.

ABOUT HEART AND DIABETES CENTER NORTH RHINE-WESTPHALIA

The Heart and Diabetes Center North Rhine-Westphalia is a world-leading
institution in the fields of cardiac, circulatory and metabolic diseases located
in Bad Oeynhausen, Germany, offering both comprehensive diagnostics and
treatment under one roof. It is one of several hospitals associated with the
University Hospital of Ruhr-University located in Bochum, Germany.

ABOUT TISSUE REPAIR CELLS

Tissue Repair Cells (TRCs) are Aastrom's proprietary mixture of bone marrow stem
and progenitor cells produced using patented single-pass perfusion technology in
the AastromReplicell(R) System. The clinical procedure begins with the
collection of a small sample of bone marrow from the patient's hip in an
outpatient setting. TRCs are then produced in the automated AastromReplicell
System over a 12-day period. It has been demonstrated in the laboratory that
TRCs are able to develop into different types of tissue lineages in response to
inductive signals, including blood, bone, cartilage, adipose and vascular
tubules. In previous clinical trials, TRCs have been shown to be safe and
reliable in regenerating certain normal bone marrow tissues.

ABOUT AASTROM BIOSCIENCES, INC.

Aastrom Biosciences, Inc. (NasdaqSC: ASTM) is a regenerative medicine company
developing proprietary adult stem cell-based products for the repair of damaged
human tissues and other medical disorders, or the generation of normal human
tissues. Aastrom's strategic position in the tissue regeneration and cell
therapy sectors is enabled by its proprietary Tissue Repair Cells (TRCs), a mix
of bone marrow stem and progenitor cells, and the AastromReplicell(R) System, an
industry-unique automated cell production platform used to produce cells for
clinical use. Together TRCs and the AastromReplicell System provide a foundation
that the Company is leveraging to produce multiple Prescription Cell Products
(PCPs), which are now in the clinical stage in the U.S. and EU. TRCs are the
core component of the PCPs Aastrom is developing for bone grafting, peripheral
vascular disease, jaw bone reconstruction and spine fusion markets. The Company
has also developed the AastromReplicell System for dendritic cell production for
researchers and institutions developing vaccines to treat cancer and infectious
diseases, under its Cell Production Products line.

For more information, visit Aastrom's website at www.aastrom.com.

THIS DOCUMENT CONTAINS FORWARD-LOOKING STATEMENTS, INCLUDING WITHOUT LIMITATION,
STATEMENTS CONCERNING PLANNED CLINICAL TRIALS AND THEIR EXPECTED RESULTS,
PRODUCT DEVELOPMENT OBJECTIVES, POTENTIAL PRODUCT APPLICATIONS, AND POTENTIAL
ADVANTAGES OF THE AASTROMREPLICELL(R) SYSTEM, WHICH INVOLVE CERTAIN RISKS AND
UNCERTAINTIES. THE FORWARD-LOOKING STATEMENTS ARE ALSO IDENTIFIED THROUGH USE OF
THE WORDS "EXPECTS," "MAY," "PLAN," "CAN," "SEEKING," AND OTHER WORDS OF SIMILAR
MEANING. ACTUAL RESULTS MAY DIFFER SIGNIFICANTLY FROM THE EXPECTATIONS CONTAINED
IN THE FORWARD-LOOKING STATEMENTS. AMONG THE FACTORS THAT MAY RESULT IN
DIFFERENCES

ARE THE UNCERTAINTIES OF CLINICAL TRIAL RESULTS, POTENTIAL PRODUCT DEVELOPMENT
DIFFICULTIES, THE EFFECTS OF COMPETITIVE THERAPIES, REGULATORY APPROVAL
REQUIREMENTS, THE AVAILABILITY OF FINANCIAL AND OTHER RESOURCES AND THE
ALLOCATION OF RESOURCES AMONG DIFFERENT POTENTIAL USES. THESE AND OTHER
SIGNIFICANT FACTORS ARE DISCUSSED IN GREATER DETAIL IN AASTROM'S ANNUAL REPORT
ON FORM 10-K AND OTHER FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION.

CONTACTS:

Kris M. Maly or Becky Anderson
Investor Relations Department
Aastrom Biosciences, Inc.
Phone: (734) 930-5777

Kevin McGrath
Cameron Associates
Phone: (212) 245-4577

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