IOMED Streamlines Company Focus On Ophthalmic and Local Inflammation Markets; Executive Changes Support Market-Driven Strategy.

Business Editors and Medical/Health Writers

SALT LAKE CITY--(BW HealthWire)--July 6, 2000

IOMED, Inc. (AMEX: IOX) has strategically refocused to concentrate its internal research, product development and commercialization activities on opportunities for the site-specific delivery of drugs in the local inflammation and ophthalmic markets. Active transdermal/transscleral local delivery of therapeutics holds potential for significant clinical advantages for these two markets, each of which represents an estimated $5 billion annual global opportunity.

To support this market-driven focus, Steven L. Hamilton has been named Executive Vice President in charge of the ophthalmic program including OcuPhor(TM), while W. Tim Miller is now Executive Vice President responsible for the Company's local inflammation initiatives including the ProDex(TM) and IontoDex(TM) programs.

"Our product development efforts will be pursued both independently or in collaboration with corporate partners, and includes marketed drugs as well as drugs under development," commented James R. Weersing, president and chief executive officer. "In addition, we will selectively consider acquisition and in-licensing opportunities of other technologies or products consistent with our objectives in these two clinical areas."

The Company's ophthalmic program has near-term emphasis on diabetic retinopathy, age-related macular degeneration, cytomegalovirus, retinitis, endophthalmitis and chronic uveitis. Iomed utilizes a proprietary system for the active transport of water-soluble ionic drugs into and through the sclera using a mild electric current. The Company is able to deliver both large and small molecules in therapeutic quantities to the back of the eye without systemic circulation and without penetrating the eye by needle injection.

Successful pre-clinical results in delivering the antibiotic amikacin to retinal tissues were recently announced. Other pre-clinical safety studies have shown that Iomed's system did not interfere with visual function. The Company plans to develop its ophthalmic delivery platform, OcuPhor, both independently and in conjunction with those pharmaceutical or biotechnology companies that need a simple, non-invasive method to deliver their proprietary compounds to the eye. The Company notes that there are at least 20 products in various stages of pre-clinical and clinical development for treating diabetic retinopathy and age-related macular degeneration, the two leading causes of blindness in North America and Europe.

ProDex, an active transport system for delivering a potent, widely used anti-inflammatory drug for treating common ailments like Achilles tendonitis, tennis elbow and carpal tunnel syndrome, is currently in Phase III studies. The Company plans to complete the studies and file a new drug application (NDA) with the Food and Drug Administration (FDA), with a U.S. product launch planned for calendar year 2002.

ProDex will be marketed to existing Iomed customers including orthopedists, sports and occupational medicine physicians, physical therapists and podiatrists. IontoDex, a patient home-use product, will follow ProDex and will allow the Company to expand its marketing efforts to primary care physicians and other medical specialists. It is anticipated that an over-the-counter version of the IontoDex product also will be developed.

To facilitate these initiatives, Iomed will be moving to a 34,000 square foot facility in Salt Lake City, which will house manufacturing, administration and research and development in a single building, with opportunity for future expansion. The Company expects to complete the relocation by calendar year end. Iomed will take a non-recurring charge of approximately $300,000 to $400,000 in the June 2000 quarter related to the early termination of existing leases, and expects to realize operating efficiencies as a result of the facilities consolidation.

"With the resulting cash flow from over $10 million in annual revenues, approximately $15 million in cash and marketable securities and modest long-term debt, we have the financial base to pursue our strategies," added Mr. Weersing. "In addition, our technology has been applied clinically in more than 13 million patient treatments, and over 60 U.S. patents provide us with excellent intellectual property protection."

Iomed is a Specialty Pharmaceutical company focused on bringing new, innovative products to large global markets for chronic and acute conditions with significant unmet clinical needs. Product-development efforts feature the Company's proprietary active transdermal/transscleral drug-delivery technology, and include existing drugs as well as drugs under development. The Company's initial two-pronged focus is on local inflammation, and on ophthalmology where a host of potential new drugs face significant delivery challenges.

Statements contained in this news release that are not purely historical are forward-looking statements, as defined in section 21E of the Securities and Exchange Act of 1934, and include Iomed's beliefs, expectations or intentions regarding its future operations and financial condition. All forward-looking statements included in this news release are made as of the date hereof and are based upon information available to Iomed as of such date. Iomed assumes no obligation to update any forward-looking statement. It is important to note that actual outcomes could differ materially from those in such forward-looking statements. Readers should also refer to the risk factors and other disclosures set forth in Iomed's filings with the Securities and Exchange Commission on Form 10-K.