The aim of the study is to assess safety, tolerability and preliminary efficacy of XSTEM-OA when administered as a single intra-articular injection to patients with symptomatic knee osteoarthritis. The study is divided into two parts; a dose escalation (Part A) and an optional dose expansion part (Part: B). Three dose levels are planned to be evaluated in Part A and selected dose level(s) may be further expanded in Part B.

Major inclusion criteria:

• Aged ≥40 and ≤75 years at Screening
• Radiological evidence of predominantly medial osteoarthritis in the knee, uni- or bilateral, of KL grade II to III
• Moderate to severe pain associated with osteoarthritis in the knee as measured by a VAS pain score of ≥35 and ≤90 mm

Major exclusion criteria:

• Body mass index (BMI) of ≥35 at Screening
• Ongoing signs or symptoms of systemic or local infection
• Known knee infection in the study knee within 6 months of Screening
• History of clinically relevant concomitant joint disease, clinically-relevant knee deformities, or any clinically significant medical history of the ligament, or realignment surgery or joint replacement surgery
• Medical history of any autoimmune disease
• History of surgery in the study knee that occured within 6 months of Screening
• Treatment with immunosuppressive therapy (systemic or local) or any medication affecting the bone or cartilage metabolism within 6 months of Screening
• Patients who are immunocompromised as caused by a disease