WR2 Acquires STI.

Business Editors

INDIANAPOLIS--(BUSINESS WIRE)--June 30, 2000

Two Companies Will Offer Hospitals Low-Cost Solutions for On-Site

Elimination of Red Bag and Path Waste Without Incineration 

Waste Reduction by Waste Reduction, Inc. (WR2), the world's leading manufacturer of equipment for environmentally responsible elimination of pathologic and animal tissue waste, has acquired Sterile Technology Industries, Inc. (STI), a leader in biohazardous waste sterilization and destruction equipment, the companies announced today.

Randall G. McKee will continue to serve as president and CEO of STI from the company's current headquarters in West Chester, Pa.

"I am pleased and proud that all STI employees will play an important role in this new phase of rapid growth with our company," said McKee, who founded STI five years ago.

WR2 and STI will offer hospitals two products that provide a complete, low-cost system for eliminating all biomedical waste at the point of generation -- without incineration. The STI Chem-Clav(R) and STI Path-Clav(R) will handle red bag, pathologic and research animal carcasses and tissue -- including radioactively contaminated tissue.

The products will enable hospitals to comply with the Environmental Protection Agency Clean Air Act's requirement that all medical waste disposal and treatment processes meet stringent new air emissions standards by the year 2002. The new EPA regulations will make on-site incineration impractical for most hospitals.

"In addition to their reliability, safety, and environmental compliance, the STI Chem-Clav and STI Path-Clav feature very low operating and acquisition costs," said Joseph H. Wilson, president and CEO, WR2. "This combination of state-of-the-art technology and low cost will make both products compelling choices for hospital facilities directors, financial officers and safety officials.

"These two products will save the healthcare industry and its funders tens of millions of dollars annually in waste disposal costs," Wilson added.

"STI has given the healthcare industry the first truly desirable destruction/sterilization system for the treatment of medical waste," said Gordon Kaye, chairman of the board, WR2.

"Combining STI's capabilities with those of WR2 is exciting," McKee added. "It provides significant opportunities for expanding the success of each company's technologies, products and people in serving the healthcare industry."

WR2 and STI plan to unveil the STI Chem-Clav and STI Path-Clav system at the American Society of Healthcare Engineering (ASHE) trade show in Seattle, July 10-12.

About WR2

Headquartered in Indianapolis, Ind., with research laboratories located in Rensselaer, New York, WR2 manufactures equipment -- including the STI Path-Clav -- that employs heat and alkali to totally eliminate path waste, tissues and carcasses. The equipment is ideal for destroying Transmissible Spongiform Encephalopathy (TSE) agents, which cause (among others) Creutzfeldt-Jakob disease, "mad cow" disease, chronic wasting disease and scrapie. It reduces volume and weight by 98 percent -- equal to that of incineration -- and converts animal and microbial tissue into a sterile, neutral, aqueous solution that is suitable for disposal into a sanitary sewer.

In addition to pharmaceutical companies in the U.S. and Europe, WR2 equipment is currently installed in medical centers, veterinary facilities and government research facilities in the U.S., Canada and the U.K.

WR2's European subsidiary, Waste Reduction Europe, Ltd. (WRE) is based in Glasgow, Scotland.

About STI

Based in West Chester, Pa., STI was founded in 1995 to develop a rugged, more cost effective way to treat medical waste.

Premier, Inc., one of the nation's leading healthcare group purchasing organizations, has named STI the sole-source provider for infectious and regulated waste treatment equipment. The three-year agreement involves the STI Chem-Clav Series 2000 continuous-feed steam sterilization equipment, related ancillary products, installation and services. The contract was awarded after an extensive, two-year review process of competitive systems.

Since the installation of the first commercial STI ChemClav in August 1995, it has processed more than 45 million pounds of waste. The hospital unit is built to the same level of durability as STI's commercial systems, establishing a new level of reliability for on-site biohazardous waste processing equipment.

In addition to placing STI Chem-Clav units in a number of U.S. hospitals and in commercial waste processing facilities, STI has placed three commercial Chem-Clav systems -- two in Northern Ireland's Antrim Hospital, and one centralized unit in Dublin -- to replace 11 large incineration plants throughout Ireland.