Collagen Aesthetics Launches the Refinity Line of High-Performance Alphahydroxy Acid Skin Care Products.

PALO ALTO, Calif.--(BW Health Wire)--Dec. 2, 1998--

-- Discontinues cash dividend to utilize cash resources for

in-licensing and acquiring new technologies --

Collagen Aesthetics, Inc. (NASDAQ: CGEN) today announced that the Company has begun marketing the Refinity(tm) Medical Skin Solutions line of high-performance alphahydroxy acid ("AHA") skin care products to U.S. dermatologists and plastic surgeons.

The Refinity Medical Skin Solutions line contains a novel and patented anti-irritant, COSMEDERM-7(tm), which enables Refinity to deliver an unprecedented combination of comfort and efficacy. The Refinity products are available only through physician offices, and include an in-office peel containing glycolic acid and home-use products containing lactic acid. Both the in-office and home-use products diminish the appearance of fine lines and wrinkles, and improve skin texture and tone.

"The launch of Refinity Medical Skin Solutions adds another important product to our aesthetic medicine franchise, which features a long-standing history of strong physician relationships and an ability to reach more than 10,000 physicians worldwide through our 100-person sales force. An estimated 75% of patients being treated with our Zyderm(R) and Zyplast(R) collagen implants are also using AHA products," commented Gary Petersmeyer, president and chief executive officer of Collagen Aesthetics. "The addition of the patented anti-irritant COSMEDERM-7 provides the critical patient benefit and competitive advantage of the Refinity line: minimizing or eliminating the itching, burning and stinging commonly associated with high-performance AHA products."

The Refinity in-office peel is 70% glycolic acid, and although other 70% glycolic acid peels are available, Refinity is the only peel that is specially formulated with an anti-irritant. This innovation allows patients to start their AHA treatment with the Refinity high-performance 70% peel, instead of incrementally increasing their peel concentration from a lower strength to a higher strength over time. This may enable patients to begin experiencing the skin improvement benefits of a high-performance AHA peel immediately. Refinity may be used for patients new to AHA-based products, patients currently using other AHA treatments as well as patients with sensitive skin.

Mr. Petersmeyer stated that a university-based clinical study comparing the Refinity Skin Refining System (in-office treatment) with conventional 70% glycolic acid peels found that Refinity reduced sensory irritation (stinging, burning, itching) by an average of 77%. Further, an independent testing laboratory conducted a 12-week study with Refinity home-use products on 33 women age 30-56 with mild-to-moderate skin aging, photo damage, fine lines and wrinkles. That study found a reduction in the appearance of fine lines and wrinkles of 38% at six weeks and 61% at 12 weeks.

The Refinity Skin Refining System, or in-office peel, includes a Pre-peel Conditioner, a Refining Peel Formula and a Post-peel Moisturizer, all of which contain COSMEDERM-7. Though treatment regimen will vary by physician and according to patient needs, the standard regimen is approximately 4 - 6 peels performed 2 - 3 weeks apart, followed by periodic in-office maintenance treatments.

The Refinity home-use skin care products are specially formulated with the anti-irritant and include moisturizers with an AHA concentration of 15%. The three-step home-use product line consists of (1) Purifying Cleanser, (2) Protective Toner formulated with COSMEDERM-7, and (3) one of three moisturizers containing COSMEDERM-7: Rejuvenating Lotion (for normal skin), Rejuvenating Cream (for dry skin) or Rejuvenating Hydrogel (for oily skin).

According to independent market research, approximately 450,000 in-office AHA peels were performed in the U.S. during 1997, and the annual growth rate since 1994 has been greater than 20%. It has been estimated that annual sales of AHA in-office and home use products to U.S. physicians are at least $50 million. When regulatory approvals permit, Collagen expects to introduce these products into Canada, Australia, Europe, and Japan.

In 1996 Collagen licensed from Cosmederm Technologies, Inc. rights to COSMEDERM-7 for distribution to and through physicians, and subsequently began joint development of the Refinity line. The active ingredient in COSMEDERM-7 is strontium, a natural element similar to calcium. Fruit acids like those contained in the Refinity line have been used in therapeutic topical preparations since 1974, and in broad use topicals (i.e., cosmetics) since the early 1990s.

Collagen Aesthetics also announced today that the Company will discontinue paying a cash dividend to stockholders in order to use its cash resources for in-licensing new products, acquiring new complementary technologies to expand the Company's product offerings, and for its previously announced stock repurchase program. The Refinity Medical Skin Solutions products are an example of the Company's effort to expand its product line through an in-licensing agreement. Dividends to date have included periodic cash payments and, most recently, the August 1998 dividend of common stock in Cohesion Technologies (NASDAQ: CSON).

Collagen Aesthetics is maximizing the Company's worldwide aesthetic medicine franchise and nearly two decades of physician relationships with proprietary and in-licensed products. The company's proprietary product line includes Zyderm and Zyplast collagen implants and Contigen(R) Bard collagen implant, while in-licensed products include Hylaform(R) viscoelastic gel and SoftForm(R) facial implant. Collagen Aesthetics' press releases can be accessed on the Internet at http://www.businesswire.com/cnn/cgen.htm.

Except for the historical information contained herein, the matters discussed in this press release are forward-looking statements, the accuracy of which is necessarily subject to risks and uncertainties. A discussion of those risks and uncertainties is set forth under the heading "Factors That May Affect Future Results of Operations" in Collagen Aesthetics' Form 10-Q filed for the quarter ended September 30, 1998.