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Advanced Tissue Sciences Announces FDA Approval for Dermagraft in the Treatment of Diabetic Foot Ulcers.

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LA JOLLA, Calif.--(BW HealthWire)--Oct. 1, 2001

Advanced Tissue Sciences, Inc. (NASDAQ: ATIS) and Smith & Nephew plc (NYSE: SNN) today announced receipt of a letter from the U.S. Food and Drug Administration (FDA) stating that the agency has approved the Premarket Approval Application (PMA) for Dermagraft(R) in the treatment of chronic foot ulcers in patients with diabetes.

With this decision, Advanced Tissue Sciences is the first company to have gained FDA approval for a tissue-engineered, living dermal substitute that is human-based, mass produced and cryopreserved. Its six-month shelf life allows important safety tests, including USP Sterility (14 day) and others, to be performed before any product is released, unlike competing tissue-engineered products that are not cryopreserved.

"As you can imagine, we are very pleased to receive notification of the approval of our PMA application," said Dr. Gail K. Naughton, president of Advanced Tissue Sciences. "While getting to this point has taken longer than we expected, we believe doctors and patients will realize that our human-based product offers significant advantages over other treatments for hard-to-heal diabetic foot ulcers. Together with our partner Smith & Nephew, we are beginning our launch activities in the United States, which include the process of seeking reimbursement coding."

Chris O'Donnell, chief executive of Smith & Nephew, said, "This is an excellent product and will, we believe, become a significant therapy to help many diabetic patients with hard-to-heal foot ulcers. Smith & Nephew is already the world's leading wound management company, and Dermagraft will join an established portfolio of major products that promote better and more efficient wound healing."

Arthur J. Benvenuto, chairman and CEO of Advanced Tissue Sciences, said, "Dermagraft and our first product, TransCyte(R) for the treatment of serious burns, were developed to address unmet clinical needs and human suffering. Both products represent significant advances in wound care. In addition, since Dermagraft, like TransCyte, is cryopreserved, Smith & Nephew's established distribution network can provide optimal flexibility in the scheduling and treatment of patients in need of this important product."

This approval will result in a $5 million milestone payment to the company from Smith & Nephew. Diabetic foot ulcer patients can learn more about whom to contact to determine if Dermagraft is suitable for them by calling Smith & Nephew's Wound Management Division at 1-800-876-1261.

Background Information

Dermagraft(R) is a cryopreserved human fibroblast-derived dermal substitute. It is composed of human fibroblasts, human extracellular matrix and a bioabsorbable scaffold. During the manufacturing process, the human fibroblasts are seeded onto a bioabsorbable polyglactin mesh scaffold. The fibroblasts proliferate to fill the interstices of this scaffold and secrete human dermal collagen, matrix proteins, growth factors and cytokines, to create a three-dimensional human dermal substitute containing metabolically active, living cells. Dermagraft does not contain macrophages, lymphocytes, blood vessels or hair follicles.

The human fibroblast cells are from a qualified cell bank, which has been extensively tested for animal viruses, retroviruses, cell morphology, karyology, isoenzymes and tumorigenicity.

Advanced Tissue Sciences is a tissue engineering company utilizing its proprietary core technology to develop and manufacture human-based tissue products for tissue repair and transplantation. It is the only company to have gained FDA approval for a tissue-engineered, living dermal substitute that is human-based, mass produced and cryopreserved.

The company has two joint ventures with Smith & Nephew. The first covers the application of Advanced Tissue Sciences' tissue engineering technology for skin wounds. This includes Dermagraft, which has been approved in the United States and other countries for the treatment of diabetic foot ulcers and has been approved in Canada for all chronic wounds. The joint venture also includes TransCyte for the temporary covering of second-and third-degree burns, and future developments for venous ulcers, pressure ulcers, burns and other non-aesthetic wound care treatments. The second joint venture is developing tissue-engineered orthopedic cartilage, initially focusing on the repair of cartilage in knee joints.

The company also has a strategic alliance with Inamed Corporation for the development and marketing of several of Advanced Tissue Sciences' human-based, tissue-engineered products, such as collagen for aesthetic and certain reconstructive applications. In addition, the company is developing products such as NouriCel(TM) for skincare and cosmetic markets and other products for cardiovascular applications. For more information on Advanced Tissue Sciences, visit our web site at

Smith & Nephew is a global medical device company employing about 7,000 people with operations in 34 countries and established sales in 90 countries. The company markets technically innovative products principally in the areas of orthopedics, endoscopy and wound management to deliver cost-effective solutions, significant physician advantages and real patient benefits. Smith & Nephew is in the leading company in the global wound management market.

The discussions contained in this press release that are not strictly historical may be "forward-looking" statements which involve risks and uncertainties. No assurances can be given that the Company can manufacture commercial quantities of Dermagraft at a reasonable cost, launch its products within indicated timeframes, successfully commercialize or significantly penetrate the market or that it will obtain adequate reimbursement for its products. These and other risks are detailed in publicly available filings with the Securities & Exchange Commission including but without limitation to Advanced Tissue Sciences' Quarterly Report on Form 10-Q for the quarter ended June 30, 2001. The Company undertakes no obligation to release publicly the results of any revision to these forward-looking statements to reflect events or circumstances arising after the date hereof.

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Publication:Business Wire
Geographic Code:4EUUK
Date:Oct 1, 2001
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