Cytori to Commercialize Stem Cell Therapy for Breast Reconstruction in Cancer Patients in Europe in Early 2008.

SAN DIEGO -- Cytori Therapeutics (Nasdaq:CYTX) (FWB:XMPA) intends to commercialize its Celution[TM] System in Europe in early 2008 for use in reconstructive surgery in breast cancer patients following a partial mastectomy (lumpectomy), in advance of the original anticipated timeline. The Celution[TM] System automates the complex process that releases stem and regenerative cells locked within adipose tissue. This enables patients' own stem and regenerative cells to be obtained at the bedside in real-time.

This accelerated product launch is primarily the result of Cytori's receipt of a favorable regulatory notice regarding the Celution[TM] System by the Competent Authority, a European medical device governing body. The notice positions Cytori to obtain expanded therapeutic claims for the system that would comprise key clinical applications, including plastic and reconstructive surgery.

"Our decision to accelerate commercialization by approximately one year is due to our regulatory progress and three additional developments," said Christopher J. Calhoun, chief executive officer for Cytori Therapeutics. "First, emerging clinical and pre-clinical experience demonstrates safety and efficacy. Second, there is strong demand from physicians to make this life-altering therapy available to their patients. Third, expansion and validation of Cytori's manufacturing facilities enable us to bring these products to market on an accelerated schedule."

Clinical Progress

In November 2006, preliminary safety was reported from an 11 patient investigator-initiated study using adipose-derived stem and regenerative cells to reconstruct breast tissue following partial mastectomy and radiation therapy. The cells were extracted using Cytori's Celution[TM] System and the study took place at Kyushu Central Hospital in Japan. The study was expanded to include eight additional patients. Evaluation of the 19 patients continues to support preliminary safety and feasibility.

"We now have a strong indication that the technology is ready for this group of patients who currently do not have a meaningful reconstructive option," said Marc H. Hedrick, M.D., president, Cytori Therapeutics. "We look forward to the presentation of Kyushu data, which will be reported in full later in the year."

Market Dynamics

Three hundred thousand patients are diagnosed with breast cancer each year in Europe and more than two hundred thousand in the U.S. Approximately 60% of these patients will be treated with lumpectomy procedures, a trend that is increasing with early detection. In addition, there are an estimated 3.0 million breast cancer survivors in Europe and 2.2 million in the U.S. The reconstruction of partial mastectomy defects represents an important unmet medical need throughout the world and an important commercial opportunity.

"We are actively appointing independent distributors in Europe to address this market opportunity," said Bruce Reuter, sr. vice president of international sales, marketing and distribution. "Clinical results coupled with patient and physician demand will allow us to expand our network of luminary surgeons and institutions in targeted regions to which we will initially sell Celution[TM] Systems. Simultaneously, we intend to broaden visibility, gain post-marketing clinical experience, and use the data to help secure reimbursement for the technology. Over the next few months, we intend to announce details of these relationships and the specific aspects of our strategy."

Manufacturing Capacity

As a result of our recent progress, Cytori has increased its manufacturing capabilities to supply Celution[TM] Systems to meet initial demand in Europe. Starting in late 2008, the next-generation Celution[TM] Systems will be manufactured by the Olympus-Cytori Joint Venture.

About Cytori Therapeutics

Cytori Therapeutics is developing and seeks to commercialize stem and regenerative cell therapies for cardiovascular disease, reconstructive surgery and many other serious chronic and life threatening conditions. To provide these therapies, physicians remove a small amount of a patient's fat, also known as adipose tissue, and run it through Cytori's Celution[TM] System. This System quickly separates and concentrates stem and regenerative cells from adipose tissue so they may be quickly administered back to the patient about an hour later. This system will dramatically improve the way in which personalized cell-based therapies can be delivered to patients. (www.cytoritx.com)

Cautionary Statement Regarding Forward-Looking Statements 

This press release includes forward-looking statements regarding events, trends and prospects of our business, which may affect our future operating results and financial position. Such statements are subject to risks and uncertainties that could cause our actual results and financial position to differ materially. Some of these risks and uncertainties include our history of operating losses and expected continuing losses, the need for further financing, our ability to develop and commercialize regenerative cell-based therapies, our dependence on third parties, our ability to obtain, defend and enforce our intellectual property, and other risks and uncertainties described (under the heading "Risk Factors") in Cytori Therapeutics' Form 10-K annual report for the year ended December 31, 2005 and subsequent SEC filings. We assume no responsibility to update or revise any forward-looking statements to reflect events, trends or circumstances after the date they are made.