BioSphere Medical Reports Record Second Quarter 2002 Financial Results.

Business Editors and Health/Medical Writers

ROCKLAND, Mass.--(BW HealthWire)--July 24, 2002

Quarterly Consolidated Revenues Increased 40% From Prior Year;

510(k) Application for Uterine Fibroid Embolization Marketing

Clearance Under Review

BioSphere Medical(TM), Inc. (Nasdaq: BSMD), a medical device company that is pioneering the use of bioengineered microspheres to treat hypervascularized tumors and vascular malformations by occluding their blood supply, today reported its financial results for the second quarter ended June 30, 2002.

Highlights

-- Worldwide Embosphere(R) Microspheres revenues in the quarter increased 69% from corresponding period of prior year

-- Net loss in the second quarter decreased to $2.14 million ($0.16 loss per share) from $2.28 million ($0.22 loss per share) from corresponding period of prior year

-- Paul A. Looney appointed Chairman of Board of Directors

-- Submission of 510(k) application with FDA for Uterine Fibroid Embolization (UFE) specific labeling clearance

-- Launch of two Embosphere(R) Microspheres product enhancements: pre-filled syringe and new vial

-- Initial market testing and qualification of new catheter and guide wire accessory products

-- EmboGold(TM) Microspheres launched in Europe

-- Redesigned corporate website with improved physician resources and patient education

Review of Financial Results

For the second quarter of 2002, BioSphere Medical reported consolidated revenues of $3.38 million, an increase of approximately 40 percent compared with consolidated revenues of $2.41 million in the corresponding period last year. The company reported a net loss of $2.14 million, or ($0.16) per basic and diluted share, for the second quarter of 2002. This compares with a net loss of $2.28 million, or ($0.22) per basic and diluted share, for the second quarter of 2001.

For the six-month period ended June 30, 2002, BioSphere Medical reported consolidated revenues of $5.98 million, an increase of approximately 40 percent compared with consolidated revenues of $4.26 million in the corresponding six-month period last year. The company reported a net loss of $4.46 million, or ($0.35) per basic and diluted share, for the first six months of 2002. This compares with a net loss of $4.78 million, or ($0.45) per basic and diluted share, for the first six months of 2001.

Management Comments on Progress

Commenting on the Company's results, Paul A. Looney, BioSphere Medical's Chairman of the Board stated, "We are very pleased with this quarter's progress and results. Despite the risk of disruption with management changes in the quarter, we remained focused and grew our embolotherapy business in the United States and Europe. We successfully launched two new embolic products and completed the initial market testing of our catheter and guide wire accessory products, in addition to filing our 510(k) application with FDA for UFE marketing clearance,"

Looney continued, "Through the end of the year, we are focused on further advancing our leadership position in embolotherapy and developing our core markets. Through the expansion of our product portfolio, we will be able to provide innovative applications to the interventional radiology market while leveraging our sales force infrastructure. Our commitment to our worldwide customer base continues to strengthen as we strive to improve patient care."

Financial Outlook and Guidance

Based on current assumptions, the Company expects consolidated revenues for fiscal 2002 to be approximately $12.5-13.5 million, of which it anticipates U.S. revenues to increase approximately 40-50% over 2001. The Company expects to spend approximately $4.0 million in research and development activities in 2002, and approximately $13.0 million in 2002 in sales, marketing and administrative expenses. Based on these projections, the Company expects to achieve operational profitability in the first half of 2003.

The Company will host its quarterly conference call today at 11 A.M. ET. The number to dial into the teleconference is (203)-830-6633. Please call in approximately ten minutes before the call is scheduled to begin. A live web cast of the conference call will also be available on the BioSphere Medical web site: www.biospheremed.com. A replay of the teleconference will be available from 2:30 P.M. (ET), Wednesday, July 24 until 12:00 A.M. (ET), Tuesday, July 29, 2002. The dial-in number is: [phone], Access Code # 287663.

About BioSphere Medical, Inc.

BioSphere Medical, Inc., based in Rockland, Massachusetts, is a medical device company focused on embolotherapy, the treatment of tumors and vascular malformations by occluding their blood supply. The Company is pioneering the use of patented and proprietary bioengineered microspheres as a new class of embolics. BioSphere Medical's lead products, Embosphere(R) Microspheres and EmboGold(TM) Microspheres, have been cleared by the FDA for marketing for hypervascularized tumors and vascular malformations. The Company has recently completed a clinical trial of Embosphere(R) Microspheres for uterine fibroid embolization (UFE) in the United States under an Investigational Device Exemption (IDE) granted by the FDA. BioSphere Medical has received CE Mark approval in the European Community and approvals in Canada and Australia which allow the Company to sell Embosphere(R) Microspheres for use in general embolization procedures, including uterine fibroid embolization.

Cautionary Statement Regarding Forward-Looking Statements - This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements with respect to the company's expected results of operations in 2002 and 2003, and expectations with respect to distribution of new products by the company and its distribution partners, and the timing and outcome of its regulatory approval efforts. The Company uses words such as "plans," "seeks," "projects," "believes," "may," "anticipates," "estimates," "should," and similar expressions to identify these forward-looking statements. These statements are subject to risks and uncertainties and are based upon the Company's beliefs and assumptions. There are a number of important factors that may affect the Company's actual performance and results and the accuracy of its forward-looking statements, many of which are beyond the Company's control and are difficult to predict. These important factors include, without limitation, risks relating to the failure of Terumo to successfully market and sell the company's products, the failure of the Company to achieve or maintain necessary regulatory approvals, either in the United States or internationally, with respect to the manufacture and sale of its products; to successfully develop, commercialize and achieve widespread market acceptance of the Embosphere(R) Microspheres and EmboGold(TM) Microsphere technologies for uterine fibroid embolization, targeted liver embolization and other applications; to provide patent and other proprietary protection for the Company's products; the absence of or delays and cancellations of, product orders; delays, difficulties or unanticipated costs in the introduction of new products; competitive pressures; the inability of the Company to raise additional funds to finance the development, marketing, and sales of its products; general economic conditions; as well as those risk factors detailed in the Company's Annual Report on Form 10-K for the year ended December 31, 2001 and Form 10-Q for the quarter ended March 31, 2002 filed by the Company with the Securities and Exchange Commission. In addition, the forward-looking statements included in this press release represent BioSphere Medical's estimates as of the date of this release. BioSphere Medical anticipates that subsequent events and developments will cause its estimates to change. However, while BioSphere Medical may elect to update these forward-looking statements at some point in the future, it specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing BioSphere Medical's estimates or views as of any date subsequent to the date of this release.

                        BIOSPHERE MEDICAL, INC.
                    SELECTED FINANCIAL INFORMATION


                 CONDENSED CONSOLIDATED BALANCE SHEETS
               As of June 30, 2002 and December 31, 2001
                       (in thousands, Unaudited)

                                                 June 30, December 31,
                                                    2002      2001
ASSETS

 Cash, cash equivalents and marketable securities  $17,509   $23,119
 Accounts receivable, net                            2,398     1,809
 Inventories, net                                    2,167     1,111
 Due from related party                               --         276
 Prepaid and other current assets                      353       282
 Property and equipment, net                         1,716     1,570
 Goodwill, net                                       1,443     1,443
 Other assets                                          381       374

  Total assets                                     $25,967   $29,984

LIABILITIES AND STOCKHOLDERS' EQUITY
 Accounts payable and accrued expenses             $ 3,683   $ 3,723
 Debt and capital lease obligations                    402       388
 Stockholders' equity                               21,882    25,873

  Total liabilities and stockholders' equity       $25,967   $29,984



            CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
      For the three and six months ended June 30, 2002 and 2001
         (in thousands, except per share amounts - Unaudited)

                                Three Months Ended  Six Months Ended
                                     June 30,            June 30,
                                  2002      2001      2002      2001

REVENUES:
  Product revenues             $  3,379  $  2,163  $  5,982  $  4,010
  Collaboration revenues           --         250      --         250

  Total revenues                  3,379     2,413     5,982     4,260

COSTS AND EXPENSES:
  Cost of product revenues          879       589     1,592     1,108
  Research and development        1,066     1,249     2,113     2,198
  Sales                           1,170     1,702     2,590     2,903
  Marketing                         803       584     1,838     1,443
  General and administrative      1,695       673     2,531     1,729

  Total costs and expenses        5,613     4,797    10,664     9,381

LOSS FROM OPERATIONS             (2,234)   (2,384)   (4,682)   (5,121)
  Other income and
   expenses, net                     93       102       222       339
NET LOSS                       $ (2,141) $ (2,282) $ (4,460) $ (4,782)

BASIC AND DILUTED NET
 LOSS PER SHARE                $  (0.16) $  (0.22) $  (0.35) $  (0.45)

Weighted average common
 shares outstanding
  Basic and diluted              12,997    10,597    12,897    10,597