Thoratec Laboratories Reports Record Fourth Quarter; Revenues Increase 43 Percent.

Business Editors

PLEASANTON, Calif.--(BW HealthWire)--Jan. 24, 2000

Thoratec Laboratories Corporation (NASDAQ: THOR), a medical device company, today reported unaudited results for the fourth quarter and all of fiscal 1999.

For the quarter ended January 1, 2000, Thoratec reported total revenues of $7.3 million, a 43 percent increase over revenues of $5.1 million in the fourth quarter of 1998. Thoratec reported a loss of $498,000, or $0.02 per diluted share, in the fourth quarter of 1999 versus a loss of $458,000, or $0.02 per diluted share, in the fourth quarter of 1998.

&uot;Thoratec's VAD (Ventricular Assist Device) system had a very strong quarter. Revenues from VAD sales increased by more than 40 percent versus both last quarter and the fourth quarter of 1998. We saw growth not only domestically but also internationally, where sales more than doubled over last quarter,&uot; said D. Keith Grossman, president and chief executive officer. &uot;Demand remained very strong as we added 36 new centers during the year bringing the total to 130.&uot;

Grossman said the company is also on track to submit documentation for the validation of a new component for its TLC-II(TM) Portable VAD Driver. He said the company plans to complete testing and data analysis by the end of February and, based on satisfactory results, resume shipping to Europe and submit an amendment to the FDA for the IDE in the U.S.

&uot;Thoratec also realized several key milestones with its graft devices during the quarter,&uot; noted Grossman. &uot;With our Aria(TM) CABG (Coronary Artery Bypass Graft) device, we have now implanted four patients in the AEGIS/Canada (AlternativE Graft Investigational Study) clinical trial for the device. The perfusion scan for the first patient was completed at two months with normal results. We also filed our Investigational Device Exemption (IDE) with the Food and Drug Administration for the Aria CABG AEGIS/U.S. trial,&uot; he continued. &uot;We received informal notice from the FDA that there would be additional questions to answer on this filing and we intend to respond as rapidly as possible to those questions.&uot;

The Aria graft, which incorporates the company's proprietary biomaterial Thoralon(TM), will be tested in patients undergoing coronary artery bypass surgery with few or no suitable native vessels. It is estimated that up to 20 percent of the more than 750,000 CABG procedures done per year worldwide involve patients having few or no suitable native vessels. The AEGIS/Canada and AEGIS/U.S. studies are designed to compare the patency of the Aria graft to poor quality autologous veins at one year after implant.

Donald Middlebrook, Thoratec's vice president for regulatory affairs and quality assurance, said, &uot;It is not unusual for the FDA to respond to an IDE with questions and they typically concern animal data, clinical protocol and the like. While we do not fully know the nature of these questions, we hope we will be able to address them quickly and that it will not greatly impact the timing of our U.S. clinical program.&uot;

Key elements of the proposed AEGIS/U.S. protocol include less than 150 patients enrolled, one year follow up and randomizing against poor quality saphenous veins as the control group. We hope we will be able to pool data from this trial with our Canadian program, potentially reducing the number of patients and time required to complete both trials,&uot; he continued.

Also during the quarter, Thoratec announced the first commercial European implant of its Vectra VAG (Vascular Access Graft), which took place at Albert Schweitzer Hospital in Dordrecht in the Netherlands. The device, which incorporates Thoralon, is designed to provide access to the blood stream in renal failure patients undergoing hemodialysis. The patient was a 71-year-old man with polycystic renal disease who had been undergoing hemodialysis through a jugular dialysis catheter that was performing poorly. The implant represents the first step preceding a European rollout scheduled to begin in the next several weeks for Thoratec's distribution program for the device with Guidant Corporation (NYSE/PCX:GDT). The Guidant agreement covers worldwide marketing and distribution rights to the device, except in Japan.

&uot;In addition, we continued to make excellent progress with our U.S. clinical trials for the device,&uot; Grossman noted. &uot;We have now enrolled all 140 patients and will have six-month data for at least 91 of them next month. Based on our analysis of the data, we could submit our results to the FDA via a 510(k) to gain FDA clearance to begin marketing as early as the middle of this year.&uot;

For all of 1999, the company reported revenues of $23.2 million, a 37 percent increase over revenues of $17.0 million in 1998. Thoratec reported a loss of $1.8 million, or $0.09 per diluted share, versus a loss of $2.3 million, or $0.11 per diluted share, in 1998.

Thoratec Laboratories Corporation is engaged in the research, development, manufacture and marketing of medical devices for circulatory support and vascular graft applications, all of which incorporate its proprietary biomaterial, Thoralon. For additional information about Thoratec, visit the company's Web site at http://www.thoratec.com.

The portions of this news release that relate to future plans, events or performance, are forward-looking statements. Investors are cautioned that all such statements involve risks and uncertainties, including the results of clinical trials, announcements by the company's competitors, risks related to the government regulatory approval process, rapidly changing technology, an intensely competitive market and market acceptance of new products. These factors, and others, are discussed more fully in the company's annual report on Form 10-K for the fiscal year ended January 2, 1999, and the company's other filings with the Securities and Exchange Commission. Actual results, events or performance may differ materially. These forward-looking statements speak only as of the date hereof. The company undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof, or to reflect the occurrence of unanticipated events.

                   Thoratec Laboratories Corporation
            Highlights of Financial Information (Unaudited)
            (numbers in thousands, except per share data)

                       Consolidated Operations

                          Fourth Quarter Ended    Fiscal Year Ended
                           Jan. 1,    Jan. 2,     Jan. 1,    Jan. 2,
                            2000       1999        2000       1999

Product sales and
 rental income           $7,165       $4,990      $22,508     $16,320

Interest and other income   163          137          692         660

Total revenue             7,328        5,127       23,200      16,980

Costs of products sold    3,406        2,046        9,739       6,504

Research and development  1,910        1,404        5,793       5,096

Selling, general and
 administrative           2,510        2,135        9,457       7,701

Total costs and expenses  7,826        5,585       24,989      19,301

Net loss                  $(498)       $(458)     $(1,789)    $(2,321)

Basic and diluted
 loss per share           $(.02)      $(0.02)      $(0.09)     $(0.11)

Shares used to compute
 basic and diluted
 loss per share          20,465       20,396       20,446      20,340


                   Consolidated Balance Sheet Items

                                                 Jan. 1,     Jan. 2,
                                                  2000        1999

Cash, Cash Equivalents
 and Short-term investments
 available for sale                               $1,973        $4,745

Current Assets                                    14,463        14,582

Total Assets                                      25,060        25,208

Current Liabilities                                3,930         3,331

Long-term deferred
 distributor revenue                                 854             0

Shareholders' equity                              20,276        21,877