KeraVision Cuts Workforce 60 Percent to Support Key Marketing and Clinical Programs.

Business Editors/Health & Medical Writers

FREMONT, Calif.--(BUSINESS WIRE)--Nov. 20, 2000

Expressing satisfaction with results from a test-market campaign launched in September, KeraVision, Inc. (Nasdaq:KERA), the vision correction company, said it will reduce its work force by 64 people, or nearly 60 percent, in order to continue investing in its test-market program. The company also intends to support existing surgeon-customers, as well as surgeons to be trained in the future, and to maintain clinical studies that could lead to additional products and applications for the INTACS(TM) micro-thin prescription insert technology.

In an effort to ensure the viability of these key market-building and business-expanding initiatives, the company has taken steps to significantly reduce KeraVision's cash-burn rate and stretch out its cash reserves, which amounted to $19 million as of September 30. In addition, options for additional financing and-or possible strategic alliances are being considered.

The work force reduction will affect all areas and levels of the company and is expected to be completed within 60 days.

KeraVision Chairman and Chief Executive Officer Thomas M. Loarie said, "I am pleased with the increases in consumer awareness and procedure volume that we are seeing in the test markets since implementing KeraVision's complete business model in September."

Loarie continued, "In order to build on these results we must pare back other activities to conserve cash. We believe this can be accomplished while also protecting KeraVision's existing surgeon-customers as well as surgeons who recently have been trained or will be in the future, and key clinical studies that could expand the applications and treatment range for INTACS inserts."

In a separate and unrelated matter, Kshitij Mohan, Ph.D., resigned from the KeraVision Board of Directors in order to devote more time to his duties as senior vice president and chief technology officer at Boston Scientific Corp., which he joined earlier in the year.

Key clinical studies to continue

On-going or planned clinical studies that will continue include an independent U.S. Navy study of INTACS inserts for myopia; U.S. Phase III clinical studies of INTACS inserts for a wider range of myopia than currently approved by the Food and Drug Administration; and a new series of "physician-sponsored" clinical studies planned by Clinical Research and Statistics (CRS) of Scottsdale, Ariz. Subject to FDA approval, the independent physician group intends to evaluate six potential new treatment applications for INTACS inserts, including keratoconus corneal-thinning disease and a number of post-LASIK complications.

KeraVision, founded in 1986, is the developer of INTACS micro-thin prescription inserts for people with -1.0 to -3.0 diopters of myopia and up to +1.0 diopter of astigmatism. Approved by the FDA in 1999, INTACS inserts were named one of "The Year's Top 10 Medical Advances" by both CNN and Health magazine. INTACS inserts are a flexible and convenient option to eyeglasses, contact lenses and vision correction surgeries that alter the eye's central optical zone. The company's patented vision correction technology is also being developed for the possible treatment of hyperopia (farsightedness); myopia (nearsightedness) in wider ranges than presently approved by the FDA; astigmatism; and keratoconus, a corneal thinning disease.

To learn if you are a candidate for INTACS micro-thin prescription inserts, take our quick vision test at www.GetIntacs.com

Except for the historical information, the matters discussed in this news release are forward-looking statements. Actual results may differ materially due to a variety of factors, including market acceptance of KeraVision INTACS inserts, complications relating to the product or the surgical procedure, uncertainties and delays in obtaining regulatory approvals, competitive products and technologies, and other risk factors described under the heading "Risk Factors" contained in Form S-2 that was filed Oct. 13, 2000 and other factors discussed in Form 10-Q for the period ended June 30, 2000.

Note to Editors: KERAVISION and INTACS are protected trademarks of KeraVision, Inc. in the U.S. and foreign countries.