Orthovita Completes RHAKOSS Pilot Clinical Study In Europe And Begins Expanded Pivotal Study Three Months Early.

Business Editors

MALVERN, Pa.--(BUSINESS WIRE)--Aug. 20, 2002

Orthovita, Inc. (NASDAQ NM / NASDAQ Europe: VITA), a leading developer of orthopaedic biomaterials, reported today that it has completed the initial clinical pilot study in Europe for RHAKOSS(TM) Synthetic Bone Spinal Implant. Following this pilot study, which was completed three months ahead of schedule, Orthovita will now begin an expanded pivotal study as a component of ongoing clinical trials to measure the safety and effectiveness of RHAKOSS for patients undergoing cervical spinal fusion surgery.

Degeneration of the discs between the vertebrae of the cervical region of the spine often results in severe pain in the neck and arms or in overt neurological symptoms. Surgical treatment typically consists of removal of the degenerated disc, followed by the placement of a structural implant in the disc space. In most cases, the implant is derived from cadaver bone, or made from titanium or carbon fiber composites. Bone tissue derived from cadavers has been linked to an increased risk of disease transmission. In addition, previous synthetic bone repair products have not matched the structural strength and other characteristics of natural bone.

"The promising results and early completion of our pilot study position Orthovita to move forward quickly to complete the next phase in our clinical trials to demonstrate the utility of RHAKOSS for the hundreds of thousands of patients each year who undergo cervical spinal fusion procedures," said Maarten Persenaire, MD, vice president of Medical Affairs World Wide at Orthovita. He added, "RHAKOSS is specifically designed to offer patients the advantages of a synthetic bone repair product - eliminating the risk of disease transmission associated with the use of cadaver tissue, and offering more consistent levels of purity, quality and availability - while closely mimicking the desired characteristics of human bone."

The expanded pivotal study will enroll 65 cervical spinal fusion patients from 10 sites in five countries. The study will continue to be led by the surgeons Jean Charles LeHuec, MD, PhD, from the Department of Orthopaedics at the University Hospital in Bordeaux, France, and Richard Assakar, MD, from the Department of Neurosurgery at the University Hospital in Lille, France.

RHAKOSS is made of Orthobone(TM), a proprietary biomaterial developed by Orthovita. It is designed to provide a synthetic alternative to structural cadaver bone with unique bioactive and bone bonding characteristics. Orthobone also ensures that RHAKOSS has a similar radiolucency to natural bone, allowing surgeons to readily assess the success of the cervical spinal fusion procedure. RHAKOSS is manufactured as a preformed composite that can be made to fit a broad range of surgical needs in terms of size, shape and form - making it a potential option for many different procedures.

Orthovita currently has two other synthetic bone products on the market. VITOSS(TM) Synthetic Cancellous Bone Void Filler is currently marketed in the U.S., Europe and Australia, and CORTOSS(TM) Synthetic Cortical Bone Void Filler is currently marketed in Europe and Australia. RHAKOSS and CORTOSS are not available for commercial distribution in the United States.

About the Company

Orthovita is a biomaterials company with proprietary technologies applied to the development of biostructures, synthetic biologically active tissue engineering products for restoration of the human skeleton. Our focus is on developing novel products for use in spine surgery and in the repair of osteoporotic fractures. We are also addressing a broad range of clinical needs in the trauma market.

We have applied our technologies to the development of three products, VITOSS(R) synthetic cancellous bone void filler, CORTOSS(TM) synthetic cortical bone void filler and RHAKOSS(TM) synthetic bone spinal implant, that we believe offer a wide range of clinical applications at various anatomical sites.

VITOSS is a resorbable calcium phosphate scaffold that is highly porous and composed of extremely fine calcium phosphate mineral that allows for resorption, cell seeding and ingrowth of host bone. VITOSS was cleared for sale in the U.S. and Australia, and approved for sale under a CE Mark in Europe.

CORTOSS is a high-strength, bone-bonding, self-setting composite engineered specifically to mimic the strength characteristics of human cortical bone. CORTOSS is approved for sale in Australia and is approved for sale under a CE Mark in Europe. CORTOSS is not available for commercial distribution in the U.S.

In addition to the recent approval to study CORTOSS in vertebroplasty, we are conducting clinical studies of CORTOSS required for approval in the U.S. for its use to augment screws that fail to hold in osteoporotic bone, as well as studies in Europe required to expand its label under the CE Mark for its use in vertebroplasty.

RHAKOSS is under development as a preformed composite that mimics the natural dual cortical-cancellous composition of human bone, providing high strength while also allowing for the ingrowth of host bone to address the vertebral interbody fusion and spinal reconstruction market. We are conducting clinical studies of RHAKOSS in Europe required to obtain a CE Mark in Europe for its use as an interbody fusion device.

This press release contains forward-looking statements regarding our current expectations of future events that involve risks and uncertainties, including without limitations, our VITOSS, CORTOSS and RHAKOSS products and other aspects of our business. Such statements are based on our current expectations and are subject to a number of substantial risks and uncertainties that could cause actual results or timeliness to differ materially from those addressed in the forward-looking statements. Factors that may cause such a difference include, but are not limited to, our dependence on the commercial success of our approved products, our history of operating losses and our need for additional funds, our need to obtain and maintain regulatory approvals to sell our products, our ability to manage commercial scale manufacturing capability and capacity, risks and uncertainties in pre-clinical and clinical trial results, market acceptance of our products, the sales levels of our products, research and development, competition and other risk factors listed from time to time in reports filed by the Company with the Securities and Exchange Commission, including but not limited to risks described in our most recently filed Form 10-K under the caption "Certain Risks Related to Our Business." Further information about these and other relevant risks and uncertainties may be found in the Company's filings with the Commission, all of which are available from the Commission as well as other sources. Orthovita undertakes no obligation to publicly update any forward-looking statements.