Orthovita Granted FDA Approval To Begin U.S. Pilot Study To Assess Use Of CORTOSS In Vertebral Compression Fractures.

Business Editors

MALVERN, Pa.--(BUSINESS WIRE)--Aug. 15, 2002

Orthovita, Inc. (NASDAQ NM / NASDAQ Europe: VITA), a leading developer of orthopaedic biomaterials, reported today it has received approval from the U.S. Food and Drug Administration (FDA) to begin a pilot study to evaluate the safety and effectiveness of CORTOSS(TM) Synthetic Cortical Bone Void Filler in the treatment of vertebral compression fractures.

The new pilot study will be conducted at four sites and will enroll a total of 20 patients. Orthovita also recently initiated U.S. clinical trials using CORTOSS in bone screw augmentation for patients with weak bone caused by osteoporosis. CORTOSS has been marketed in Europe since January 2002 for the fixation of screws used in patients with weak bone caused by osteoporosis.

"Orthovita's recent study in Europe involving 53 patients treated with CORTOSS for vertebral compression fractures has been very promising, and we are eagerly looking forward to beginning our U.S. studies to further confirm these preliminary results. CORTOSS possesses unique mechanical, biochemical and delivery characteristics that could represent significant advances in care for a very large number of patients," said Maarten Persenaire, MD, vice president medical affairs of Orthovita.

In the procedure employed in this study, known as vertebroplasty, a synthetic biomaterial is injected percutaneously through the skin into the fractured vertebra to stabilize and restore load-bearing capability. Orthovita's new U.S. study will assess the ability of CORTOSS to provide both pain relief and improvement in function to the patient by providing stability to the fractured vertebra.

CORTOSS is a high-strength, bone-bonding, biocompatible, self-setting composite engineered to mimic the characteristics of human cortical bone. Administered directly to the affected area using a pre-filled, unit dose disposable cartridge, CORTOSS has the capacity to provide immediate weight-bearing support. In surgery, CORTOSS's inherent radiopacity makes it very easy to see using standard imaging techniques, and is therefore expected to increase the safety of the procedure.

According to the U.S. National Osteoporosis Foundation, 700,000 vertebral fractures occur annually. The most common causes of vertebral compression fractures are osteoporosis associated with aging or chronic steroid use and metastatic disease. Each year, over 270,000 vertebral compression fractures are clinically diagnosed in the U.S. alone, with the number expected to rise in the years ahead. Patients are typically treated with external bracing, analgesics and bed rest. In some cases, patients are left with persistent pain and limited mobility. Bed rest and/or reduced mobility both have significant effects on a patient's quality of life, as well as on subsequent morbidity and mortality. For example, standard medical therapy for vertebral compression fractures may lead to additional bone mineral loss, thus increasing the risk of subsequent fractures.

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.