Anika Therapeutics and Zimmer Expand ORTHOVISC Distribution Agreement; Osteoarthritis Treatment to be Marketed in Eastern Europe, Middle East and Africa.

WOBURN, Mass.--(BW HealthWire)--June 8, 1999--

Anika Therapeutics, Inc. (NASDAQ:ANIK) today announced it has expanded its agreement with Zimmer, Inc., a wholly owned subsidiary of Bristol-Myers Squibb, for the sale, marketing and distribution of ORTHOVISC(R), a treatment for osteoarthritis of the knee, to include much of Eastern Europe, the Middle East and Africa.

Under the terms of the amended agreement, Zimmer will guarantee Anika increased minimum purchases and will extend its marketing efforts to support the ongoing and expanded commercialization of ORTHOVISC, a sodium hyaluronate therapy.

A world leader in knee and hip replacements, Zimmer signed a multi-year agreement with Anika in November 1997 to distribute ORTHOVISC in the U.S., Canada and parts of Asia. The agreement was expanded to include Europe and Latin America in June 1998. Anika anticipates realizing synergies of sales efforts between Europe and Eastern Europe, based on Zimmer's experience, organization and management talent.

"The extension of this agreement is a further indication of Zimmer's strong support for ORTHOVISC," said J. Melville Engle, Anika chairman, president and chief executive officer. "Zimmer has a very large dedicated sales force working closely with orthopaedic surgeons and related specialists. Extending our collaboration will enhance cohesive, global representation for ORTHOVISC by a world leader in orthopedics."

Zimmer President Ray Elliott said, "We believe ORTHOVISC will play an important role in Zimmer's future growth as we build on our tradition of global leadership in joint replacement products. The expansion of our distribution agreement into these new areas will allow us to further leverage our existing marketing and sales efforts."

Zimmer recently launched ORTHOVISC in Europe and began selling the product in Canada in 1998. ORTHOVISC is also marketed by Grupo Ferrer Internacional in Spain and Portugal, Biomeks Pharmaceuticals in Turkey and Rafa Laboratories in Israel.

A high molecular weight, highly purified, naturally derived form of hyaluronic acid (HA), ORTHOVISC is designed to emulate the viscoelastic and cushioning properties of natural HA found in the synovial fluid of healthy joints. ORTHOVISC coats, lubricates and provides shock absorption protection to joint tissues. The product is injected into the knee joint space three times over a two-week period intending to provide viscosupplementation and pain relief.

In April 1999, Anika initiated a multi-center Phase III clinical trial of ORTHOVISC, at up to 20 centers, including leading orthopedic surgeons and rheumatologists, in the United States and Canada. The trial is being conducted under an Investigational Device Exemption (IDE) received from U.S. Food and Drug Administration (FDA). The prospective, randomized, double blind study will assess the safety and effectiveness of ORTHOVISC in comparison to a saline control. As many as 350 patients will be enrolled in the study and the treatment regimen will consist of three intra-articular injections of ORTHOVISC over a two-week interval with a six-month follow-up period. The primary endpoint used to measure the effectiveness of ORTHOVISC will be a reduction in pain based on the WOMAC (Western Ontario McMaster University) pain score, a respected and validated measurement methodology.

Zimmer is a world leader in the design, manufacture and distribution of orthopaedic implants and related equipment and supplies. The company provides a broad range of joint replacement, fracture management and patient care products. Founded in 1927, Zimmer became a member of the Bristol-Myers Squibb family of companies in 1972.

Anika Therapeutics, Inc. (www.anikatherapeutics.com) develops manufactures and commercializes therapeutic products and devices intended to promote the repair, protection and healing of bone, cartilage and soft tissue. These products are based on hyaluronic acid (HA), a naturally occurring, biocompatible polymer found throughout the body. In addition to ORTHOVISC, Anika currently markets HYVISC(R) in the U.S. for the treatment of equine osteoarthritis and manufactures AMVISC(R) and AMVISC(R) Plus, highly viscous HA products used as viscoelastic supplements for ophthalmic surgery, for Bausch & Lomb Surgical. Therapies currently under development include INCERT(R), a family of HA products designed to prevent post-surgical adhesions and HA oligosaccharides for the treatment of cancer. Anika is also collaborating with Orquest, Inc. to manufacture Ossigel(R), an injectable formulation of basic fibroblast growth factor combined with HA designed to accelerate the healing of bone fractures.

The statements made in this press release which are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Exchange Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The Company's actual results could differ materially from those set forth in the forward-looking statements as a result of a number of factors. In particular, there can be no assurance that the expanded agreement with Zimmer will progress as planned, that synergies will be obtained, that the clinical trial can be completed in a timely manner or at all, or if completed, that the results of the trial will produce data supporting the efficacy of ORTHOVISC. Even if the Company is able to successfully complete the clinical trial and the results thereof support the efficacy of ORTHOVISC, there can be no assurance that the Company will receive FDA or other regulatory approval of ORTHOVISC, or that such approval will be obtained in a timely manner or without the need for additional clinical trials. In addition, there can be no assurance that any delay in receiving any such approval will not adversely effect the Company's competitive position. Certain other factors that might cause the Company's actual results to differ materially from those set forth in the forward-looking statements include those factors set forth under the heading "Risk Factors and Certain Factors Affecting Future Operating Results" in the Company's 10-K filed with the Securities and Exchange Commission on March 31, 1999 as well as those listed in the Company's other SEC filings.