ArthroCare's Parallax Acrylic Resin Receives FDA Clearance for Vertebroplasty and Kyphoplasty; New Product Improvements Enhance Company's Competitive Position.

SUNNYVALE, Calif. -- ArthroCare(R) Corp. (Nasdaq:ARTC), a multi-business medical device company that develops minimally invasive surgical products, received notice from the U.S. Food and Drug Administration (FDA) today that its Parallax(R) Acrylic Resin with TRACERS(R) Bone Cement Opacifier has been cleared for the fixation of pathological fractures of the vertebral body using vertebroplasty or kyphoplasty procedures. Painful vertebral compression fractures may result from osteoporosis, benign lesions (hemangioma), and malignant lesions (metastatic cancers, myleoma).

"While this development will not have any material impact on fourth quarter financials, it is a significant milestone for the company," said Michael Baker, president and chief executive officer of ArthroCare. "This 510(k) clearance positions us well going into 2005 to be a strong competitor in the fast-growing vertebroplasty and kyphoplasty market segments."

The FDA clearance also coincides with ArthroCare's launch of a new version of its Parallax Acrylic Resin featuring a proprietary type of tantalum. This product, currently cleared for use in cranioplasty, is designed to enhance the physician's ability to track the flow of bone cement under fluoroscopy. ArthroCare intends to seek 510(k) clearance for use of the tantalum opacified cement in vertebroplasty or kyphoplasty procedures during the first quarter of 2005.

About ArthroCare

ArthroCare Corp. (www.arthrocare.com) is a highly innovative, multi-business medical device company that develops, manufactures and markets minimally invasive surgical products. With these products, ArthroCare targets a multi-billion dollar market opportunity across several medical specialties, significantly improving existing surgical procedures and enabling new, minimally invasive procedures. Many of ArthroCare's products are based on its patented Coblation technology, which uses low-temperature radiofrequency energy to gently and precisely dissolve rather than burn soft tissue -- minimizing damage to healthy tissue. Used in more than three million surgeries worldwide, Coblation-based devices have been developed and marketed for sports medicine; spine/neurologic; ear, nose and throat (ENT); cosmetic; urologic and gynecologic procedures. ArthroCare also has added a number of products to its portfolio to complement Coblation within key indications. Founded in 1993, ArthroCare is headquartered in Sunnyvale, Calif.

Safe Harbor Statements

Except for historical information, this press release includes forward-looking statements. These statements include, but are not limited to, the company's stated business outlook for fiscal 2004 and 2005, continued strength of the company's fundamental position, the strength of the company's technology, the company's belief that strategic moves will enhance achievement of the company's long term potential, the potential and expected rate of growth of new businesses, continued success of product diversification efforts, and other statements that involve risks and uncertainties. These risks and uncertainties include, but are not limited to the uncertainty of success of the company's non-arthroscopic products, competitive risk, uncertainty of the success of strategic business alliances, uncertainty over reimbursement, need for governmental clearances or approvals before selling products, and the uncertainty of protecting the company's patent position. These and other risks and uncertainties are detailed from time to time in the company's Securities and Exchange Commission filings, including ArthroCare's Form 10-K for the year ended December 31, 2003 and the 10-Q for the quarter ended Sept. 30, 2004. Forward-looking statements are indicated by words or phrases such as "anticipates," "estimates," "projects," "believes," "intends," "expects," and similar words and phrases. Actual results may differ materially from management expectations.