BioSyntech Receives First Tranche of $1 Million From La Financiere du Quebec, Provides Shareholder Update On Projects.

LAVAL, Quebec -- BIOSYNTECH (TSX VENTURE:BSY) announces that La Financiere du Quebec has paid out the first tranche of $1million of the $2.5-million venture loan that it granted the Company on March 15, 2004. In accordance with the terms of this loan, La Financiere du Quebec has been granted an option, for a five-year period, to acquire 300,000 shares of the Company at $1.25 per share.

BioSyntech would also like to inform its shareholders of the status of its various development activities.

BST-InPod(TM) Pilot Clinical Study Completed: The results from BST-InPod's pilot clinical study, initiated in Europe during the summer of 2002, have been compiled.The data shows that BST-InPod(TM) brought notable relief of heel pain to 78% of patients treated.In addition to providing positive evidence of effectiveness to support efficacy claims for the European market, the study allowed BioSyntech to refine the clinical usage of the product.We are now preparing a Canadian controlled clinical trial for North-American regulatory approvals.A clinical protocol has been drafted for this study, and includes objective outcome measurement, such as ultrasound imaging of the fat pad in the foot and use of pressure mapping insoles.In addition, a US-based global orthopaedic company has recently constituted a scientific advisory board and has became involved in the preparation of this clinical trial, and provided guidance.

BST-CarGel(TM) On Track for Marketing approval in 2006

Investigator Training to Begin in Mid-January for Clinical Trial

For BST-CarGel(TM), the preparatory phase of the multi-center Canadian-European clinical trial is completed.Early patient recruitment is on-going, and on November 24, BioSyntech met with over 20 potential candidates in Montreal to discuss the product and the trial.These patients were referred by a prominent local orthopaedic surgeon.Critical Site Evaluation Visits are currently being carried out by our Contract Research Organisation (CRO), and trial documentation is being compiled. Furthermore, an Investigators Meeting, the 2-day forum for investigator training and final discussion before official patient enrolment, is planned for mid-January.BioSyntech confirms that the current schedule is still on target for Canadian and European marketing of BST-CarGel(TM) in 2006, assuming required approvals.

As previously announced, BioSyntech hopes to maximize the use of the data from the current study, particularly as supporting evidence in FDA submissions for the US market. On-going discussions with a major global orthobiologic company have recently produced several new regulatory approaches in this regard.These new strategies align well with our current path, and will be implemented into the present Canadian-European trial.

BST-DermOn(TM): A Canadian clinical trial is under preparation for BST-DermOn(TM).The clinical protocol has been drafted, and the CRO to run the trial is being selected at the present time and will be announced shortly.The trial is slated to begin in Q2, 2005, and should be completed by Q4, 2005.

Therapeutic Delivery Applications: Therapeutic delivery of anti-cancer drugs as well as biological compounds using BioSyntech's BST-Gel(R) continues to carry high potential value.Recent efforts in several programs within BioSyntech's product pipeline have resulted in strong collaborations with external academic and industrial partners.

Oncology: The use of BST-Gel(R) as a drug delivery system recently assisted researchers within the McGill University Health Center (Montreal General Hospital) in obtaining a Canadian Institutes of Health Research (CIHR) Industrial partnership grant for continuing the investigation of camptothecin delivery and controlled release of other anti-cancer drugs to treat head and neck cancers.

Bone Morphogenic Proteins: A recent animal study performed by a Montreal-based CRO specializing in bone studies highlighted the BST-Gel's strong ability for local delivery of bone morphogenic proteins (BMPs) with desired biological effects. These proteins are known to promote bone healing and are marketed or in the pipeline of several important orthopaedic companies (Stryker Biotech, DePuy, etc.). The ability to deliver BMPs in a matrix that preserves their biological activity and maintains them at the delivery site greatly improves the potential of the therapy.

BST-Ossifil(TM): Injectable bone substitutes (i.e. bone void fillers) continue to represent a viable market for BioSyntech's BST-Ossifil(TM) which is based on BST-Gel(R). BST-Ossifil(TM) contains calcium phosphate, a mineral which has long been recognized for its osteoconductivity.Use of BST-Ossifil(TM) in a long bone repair study began in November in collaboration with a European company involved in bone substitutes, while dental applications are being explored through a study with university researchers in Montreal.

Gynecology Therapeutic Applications: Another early phase project involves the use of BST-Gel(R) in a non invasive gynecological application for tubal occlusion to induce sterility- giving an alternative method to the current invasive surgical fallopian tube procedure.A proof-of-principle study has recently been started.

BioSyntech is also involved in various other projects lead by external collaborators, and covered by confidentiality agreements.

About BioSyntech - BioSyntech is a biotechnology company specializing in the discovery, development and manufacturing of innovative cost-effective and physician-friendly biologic-implants for regenerative medicine and therapeutic delivery.BioSyntech's Quality Management System is registered to ISO 9001:2000 and ISO 13485:2001 standards. For additional information, visit www.biosyntech.com.

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BioSyntech Inc. (TSX VENTURE:BSY)