Surgical Device Company Wins 2010 NJTC "Best Early Stage Company" Award

At the 12th Annual New Jersey Technology Council (NJTC) Venture Conference in Somerset, NJ on March 26, Endomedix, Inc. (www.endomedix.com) unveiled a sprayable surgical hemostat that promises to change the way surgeons control bleeding during surgeries such as craniotomy and Ear, Nose & Throat (ENT) sinus procedures. The company’s proprietary technology will also lead to flowable hemostats for use in most other surgeries as well for military, first responder and ER applications. The Company’s product portfolio and business plans were key factors that led to the selection of Endomedix as the recipient of the "Best Early Stage Company" Award by judges at the Conference, where more than 65 companies showcased a broad spectrum of leading edge new technologies, products and services.

The Endomedix device sprays on the surgical site and forms a hydrogel in seconds, leading to the rapid formation of a mechanical clot. The hydrogel also contains a natural hemostat to amplify the natural cascade of coagulation. The device can produce effective hemostasis, or control of bleeding, much faster and is easier to use than competitive products. Since many surgeries require that bleeding be controlled many times during a procedure, the new device will save hospitals thousands of dollars per case in OR and anesthesia charges alone.

"Our technology is based on natural materials with a long history of use in FDA-regulated products, and our intellectual property is based on the innovative treatment and processing of these materials", explains Richard Russo, Chief Executive Officer. "Surgeons will be able to spray on our devices precisely, with almost immediate effect, so they can continue the surgery without having to wait a long time for bleeding to stop. Our product is also transparent, so unlike products currently available, the surgeon can see through it to confirm that bleeding has stopped."

Unlike many companies that try to invent something totally new, such as cure for a disease, Endomedix is developing products with improved performance and ease of use for procedures that surgeons perform every day. "It’s exciting to develop a device for a billion dollar plus market that both performs better and costs less to produce than the devices currently available," says Russo. "We’re in a strong position given what’s happening in medical care delivery systems around the world."

The daylong annual NJTC meeting is the largest of its kind on the East Coast. More than 65 companies showcased technologies and products from various sectors, including life sciences, information technology, energy/environmental management, telecommunications and nanotechnology. "Participants included a new crop of vibrant startup companies" said Aron Spencer, CEO of InVenture LLC, a firm that helps startups leverage inventions into viable companies, and Professor of Entrepreneurship at New Jersey Institute of Technology. "Selecting a single winner this year was not easy, but the combination of its experienced management, technology and business opportunity certainly qualifies Endomedix as the Best Early Stage Company of 2010".

"We are moving steadily toward commercialization, and one of the key challenges that every firm in our situation must overcome is obtaining additional investment funds in this very difficult business environment", noted Russo. "We are making use of the experience and talents of the New Jersey Entrepreneurs Forum (www.NJEF.org) to provide insight on how to navigate the world of professional investors interested in private companies and startups. Their advice has helped us enhance our investment appeal, as evidenced by this Award."

FDA Approves First Biodegradable Sealant Patch for Cardiovascular Surgery

Blood-clotting patch is absorbed by the body

SILVER SPRING, Md., April 5 /PRNewswire-USNewswire/ -- The U.S. Food and Drug Administration today approved TachoSil, the first absorbable fibrin sealant patch for use in cardiovascular surgery to prevent mild and moderate bleeding from small blood vessels, when standard surgical techniques are ineffective or impractical. TachoSil is a ready-to-use surgical patch composed of a dry collagen sponge made from horse tendons, and coated with fibrinogen and thrombin. At the site of a wound, the two proteins, through a series of chemical reactions, produce fibrin, a stringy, white, insoluble protein that allows a clot to form. The TachoSil patch is biodegradable and breaks down inside the body within four to six months. TachoSil is not intended for use within blood vessels.
"This approval provides an additional tool for surgeons to help control mild and moderate bleeding from blood vessels during cardiovascular surgery when standard surgical techniques are ineffective or impractical," said Karen Midthun, M.D., acting director of the FDA's Center for Biologics Evaluation and Research.
The plasma used to manufacture TachoSil is collected from U.S. donors who have been screened and tested for diseases transmitted by blood. The fibrinogen and thrombin used in the surgical patch undergo additional manufacturing processes to remove impurities, including bloodborne viruses. The collagen taken from horse tendons undergoes a separate step to remove impurities, including equine viruses.
The effectiveness of TachoSil manufactured by Nycomed Austria GmbH of Linz, Austria was evaluated in a study of 119 cardiovascular surgery patients. Nearly three-quarters (74.6 percent) of those who received TachoSil, stopped bleeding within three minutes compared with 33.3 percent in the control group.
Hypersensitivity to product components or allergic reactions may occur with TachoSil. The adverse reaction rates were not statistically different between the study and control groups.

CryoLife Files for Preliminary Injunction Against Medafor

CryoLife Believes Attempt to Terminate Distribution Agreement Is Improper

ATLANTA, GA…(March 30, 2010)…CryoLife, Inc. (NYSE: CRY), an implantable biological medical device and cardiovascular tissue processing company, announced today that it filed an emergency motion for a preliminary injunction against Medafor, Inc. in the United States District Court for the Northern District of Georgia, Atlanta division. CryoLife contends that Medafor is improperly attempting to terminate the exclusive distribution agreement ("EDA”) between the parties, and CryoLife has requested that the Court enjoin Medafor from proceeding with the termination.

CryoLife believes that Medafor’s attempt to terminate the EDA is wrongful for several reasons. Primarily, Medafor ignored the fact that the parties contracted away any right to apply the adequate assurances statute that Medafor is now invoking to attempt to terminate the EDA. Even if the statute applied, CryoLife believes Medafor failed to meet the statutory prerequisites for termination, for numerous reasons, including those described below.

Specifically, the statute is only available to a party with a reasonable basis for insecurity regarding the other party’s future performance, and CryoLife’s adherence to the contract has never been in legitimate doubt. The statute requires that any assurances demanded by a party with an insecurity be reasonable. CryoLife believes that Medafor’s requested assurances were not reasonable and in fact were designed to be overreaching and abusive. Perhaps most importantly, the statute demands that the party invoking it do so in absolute good faith, and CryoLife believes Medafor’s invocation of the statute was made in bad faith, as a pretextual scheme to get out of a contract that Medafor found itself unable and unwilling to honor.

The statute is also not available to a party who itself is in breach of its obligations. CryoLife is aware of numerous breaches by Medafor of the EDA, including: promoting and marketing product on its website for use in CryoLife’s exclusive Field in violation of the EDA; failing to prevent its Brazilian distributor from marketing and promoting the product on its website; failing to respond to notice letters of prohibited conduct in 17 instances, along with failing to respond to many of the allegations contained in the complaint filed against it by CryoLife; failing to respond to CryoLife’s notice letters regarding Medafor’s breaches of conduct in Spain; and refusing to protect the intellectual property rights of Medafor’s MPH technology in accordance with the terms of the EDA.

Steven G. Anderson, CryoLife’s chairman, president and chief executive officer, commented, “CryoLife has assiduously followed the terms of the EDA and has repeatedly communicated to Medafor its intention to continue to honor the terms of the EDA. We believe that Medafor’s request for assurances was not made in good faith and that it was simply a pretext to terminate a contract that they cannot consistently comply with, as evidenced by their repeated breaches. Unfortunately, in attempting to repudiate the EDA, we believe Medafor has put itself and its shareholders at great risk. Should this gambit fail, Medafor has exposed itself to significant damages in addition to the damages arising under the complaint previously filed by CryoLife and the substantial litigation costs this process will accrue.”

In the event an injunction is not granted, however, CryoLife will pursue its rights with respect to the EDA vigorously, including claims, for among other things, breach of contract, fraud and negligent misrepresentation and violation of the Georgia RICO provisions, and CryoLife will consider all avenues open to it to protect its interests and those of its shareholders and recover appropriate compensation from Medafor for its reckless actions.

CryoLife believes that it currently has enough inventory, with or without the fulfillment of the March 16, 2010 purchase order that was disputed by Medafor, to meet its business needs through the end of May 2010. CryoLife is optimistic that the court will rule on its motion for preliminary injunction prior to that time.

Shareholders may continue to visit www.cryolife.com/medaforoffer for additional information about CryoLife and its relationship with Medafor. Additional detail regarding the litigation between CryoLife and Medafor is also available in CryoLife’s filings with the Securities and Exchange Commission.

About CryoLife, Inc.

Founded in 1984, CryoLife, Inc. is a leader in the processing and distribution of implantable living human tissues for use in cardiac and vascular surgeries throughout the U.S. and Canada. The Company's CryoValve^® SG pulmonary heart valve, processed using CryoLife's proprietary SynerGraft^® technology, has FDA 510(k) clearance for the replacement of diseased, damaged, malformed, or malfunctioning native or prosthetic pulmonary valves. The Company’s CryoPatch^® SG pulmonary cardiac patch has FDA 510(k) clearance for the repair or reconstruction of the right ventricular outflow tract (RVOT), which is a surgery commonly performed in children with congenital heart defects, such as Tetralogy of Fallot, Truncus Arteriosus, and Pulmonary Atresia. CryoPatch SG is distributed in three anatomic configurations: pulmonary hemi-artery, pulmonary trunk, and pulmonary branch. The Company's BioGlue^® Surgical Adhesive is FDA approved as an adjunct to sutures and staples for use in adult patients in open surgical repair of large vessels. BioGlue is also CE marked in the European Community and approved in Canada and Australia for use in soft tissue repair. The Company's BioFoam™ Surgical Matrix is CE marked in the European Community for use as an adjunct in the sealing of abdominal parenchymal tissues (liver and spleen) when cessation of bleeding by ligature or other conventional methods is ineffective or impractical. BIOGLUE Aesthetic^® Medical Adhesive is CE marked in the European Community for periosteal fixation following endoscopic browplasty (brow lift) in reconstructive plastic surgery and is distributed by a third party for this indication. CryoLife distributes HemoStase^®, a hemostatic agent, in much of the U.S. for use in cardiac and vascular surgery and in many international markets for cardiac, vascular, and general surgery, subject to certain exclusions.

Crabs and eyeballs not usually a good mix

Australian scientists have developed a new type of surgical glue, made from crab shells, that could replace stitches now used in eye surgery.
The liquid, which is painted onto a wound or incision and then heat sealed with an infrared laser, cuts the risk of infection and scarring that can cause vision loss.
Co-inventor of "SurgiLux", Associate Professor John Foster who leads the University of NSW's Biopolymer Research Group, said it could also be used safely in brain and nerve surgery.
"Some glue technologies rely upon ultra-violet for wound bonding but aren't really suitable because UV-rays damage living cells," Dr Foster said in a statement.
"The beauty of SurgiLux is that an infrared laser doesn't cause tissue damage ... better still, it has inherent anti-microbial properties, which discourage post-operative infections."
The green-coloured polymer is made from crab-shell extract and it is biodegradable.
A commercial backer for the product is now being sought, to fund further clinical trials ahead of a possible launch on the global tissue sealants market.
This market was estimated at more than $500 million in 2008, with an eight per cent annual growth rate.
NewSouth Innovations (NSi), the university's commercialisation body, controls the rights to the invention.
"NSi and the inventors of SurgiLux are seeking partners to clinically and commercially develop this proprietary technology," said NSi Business Development Manager Dr Alfredo Martinez-Coll.
"The nature of the investment would be through collaborative research and or a licence deal.

Maryland and Arkansas Teams Win ORNL Global Venture Challenge

OAK RIDGE, Tenn., March 26, 2010 — OAK RIDGE, Tenn., March 26, 2010 -- Graduate students from the University of Arkansas and the University of Maryland received first place at the 2010 Global Venture Challenge that was hosted at Oak Ridge National Laboratory March 24-26. The challenge is a competition that brings together students developing new technology in the two tracks of energy and security and venture investors with expertise in the marketplace.

Douglas Hutchings, Stephen Ritterbush and Seth Shumate, a doctoral student in microelectronics and photonics, from the University of Arkansas won first place in the energy division for their energy company Silicon Solar Solutions.

"Our method replaces the expensive top layer of solar cells with a thinner, large- grain polysilicon at lower temperatures, which reduces cost and is appealing to manufacturers," said Ritterbush, an M.B.A. student.

Matthew Dowling, Peter Thomas and Oluwatosin Ogunsola of the University of Maryland won first place in the security division for their company Remedium Technologies, Inc,, which produces a sprayable hemostat. Dowling and Thomas, doctoral students in bioengineering, said that, unlike hemostats that treat superficial wounds, their Kytoclot technology is a portable, pressurized foam that provides needed compression and protection to wounds within the body cavity. Traditionally, intracavitary wounds have almost always required surgery to prevent hemorrhage-related deaths.

"Currently there is no market for a product like this. The Department of Defense, the military, would be our first potential customer because they have a great need for this sort of product, which can sustain a lot of different temperatures and quickly stops bleeding," Dowling said.

Twenty-two teams of graduate students from five countries traveled to Oak Ridge to present new technology products that satisfy current market demands. In its fourth year, Global Venture Challenge has grown significantly in the last year.

"We have really expanded our reach globally with applications from 44 teams in eight countries, and that's a record," said Tom Rogers, director of the Industrial and Economic Development Partnerships Directorate, said. "Many of the judges have said that the technology this year is far superior to prior years. Every year it gets bigger and better."

More than 50 judges, including judges from 15 venture capital firms, selected winners based on the quality of the technology and the product's projected strength in the marketplace.

Rogers said several teams from past years are now in business and several of the teams that presented this year are already on their way. Dowling said Remedium Technologies, Inc. has already garnered capital from start-up investors, and Silicon Solar Solutions is in the process of speaking with manufacturers.

During the three-day competition, students toured ORNL facilities, met with Lab Director Thom Mason and attended a Venture showcase highlighting cutting-edge technology being developed at ORNL.

The two first-place teams were awarded $25,000 each. First runner-up teams EconoSun of Purdue University and Delta R Detection of the University of Florida received $10,000 each. Second runner-up teams GLADteam of the University of Alberta, Carnegie Mellon University, Maastricht University and Indentizyme Defense Tech of the University of North Carolina, Chapel Hill received $5,000, and six honorable-mention teams received $1,000 each.

Prize money and travel stipends were funded by sponsors, including the Department of Energy's Industrial Technology Program, the Department of Homeland Security's Community & Regional Resilience Institute, Oak Ridge Associated Universities, Battelle Ventures, The National Institute for Hometown Security, the National Venture Capital Association, the East Tennessee Economic Council and Meritus Ventures. ORNL is managed by UT-Battelle for the Department of Energy's Office of Science.

Cryolife withdraw Medafor offer

ATLANTA, GA…(March 24, 2010)…CryoLife, Inc. (NYSE: CRY), an implantable biological medical device and cardiovascular tissue processing company, announced today that it has withdrawn its $2.00 per share proposal to acquire Medafor, Inc. CryoLife previously notified the Medafor board of its intention to withdraw its offer in five business days. Based on the limited information that Medafor has made available to its shareholders, CryoLife continues to believe that the Medafor board’s stated strategic rationale for entering into the Magle transaction does not justify the significant dilution suffered by Medafor shareholders. “It is clear by the recent actions of Medafor’s board and management team that they are committed to entrenchment, even if it means further dilution and the destruction of shareholder value,” said Steven G. Anderson, CryoLife’s chairman, president and chief executive officer. “We continue to believe that Medafor is mismanaged and in poor financial condition. As Medafor’s largest shareholder, we are deeply concerned by Medafor’s recent statement that it currently holds only $1,000,000 in cash. We believe that Medafor’s limited capital is wholly insufficient to sustain the company’s growth and defend its intellectual property. Although we are withdrawing our offer, we intend to pursue all actions necessary to preserve the value of our investment.” “We encourage existing Medafor shareholders to continue to reach out to Medafor’s board and management team and voice their concerns. Based on our recent conversations with fellow Medafor shareholders, we believe many shareholders share our frustrations with Medafor’s actions and have deep concerns about the future of the company under its existing leadership,” concluded Anderson.

Medafor shareholders may continue to visit www.cryolife.com/medaforoffer for additional information about CryoLife and its thoughts on the appropriateness and effectiveness of Medafor’s management’s actions and the company’s performance and outlook.

Haemacure sale of assets to Angiotech clears another hurdle

March 22 (Reuters) - Haemacure Corp (HAEFQ.PK) said it received permission from the Superior Court of the Province of Quebec to sell its assets to Angiotech Pharmaceuticals Inc (ANP.TO), a secured creditor of Haemacure.
The Canada-based biotherapeutic company said the United States Bankruptcy Court had previously authorized the sale to Angiotech of the assets of Haemacure's U.S. subsidiary.
Haemacure also said it obtained a second extension, until April 19, within which to make a proposal to its creditors.
The extension will also allow Haemacure and Angiotech to complete the documentation required for the closing of the asset-sale transactions in Canada and the United States. The closings are expected to be held prior to the new expiry date of April 19.

Medafor CEO responds to latest Cryolife salvo

MINNEAPOLIS - (Business Wire) Medafor Inc. (“the Company”) sent a letter to its shareholders detailing recent corporate accomplishments, including highlights from the Company’s unaudited financial results for 2009, and recent significant developments at the Company.

The complete text of that letter follows:

March 22, 2010

Dear Medafor Shareholders,

I am writing to update you on our financial highlights for 2009, as well as to provide you with some information about recent developments at our Company.

2009 Financial Highlights

I am pleased to report that Medafor has once again experienced a very strong year. Our performance was highlighted by continued revenue growth, a significant increase in operating profitability and steady positive cash generation. Perhaps most important is our demonstrated success in increasing MPH market penetration worldwide. As a result, we have entered 2010 with an improved financial base and a strong operational foundation.

Each shareholder will be receiving the audited numbers and detailed commentary following the completion of our annual audit. The audit has just commenced and we expect it to be finalized in late April or early May. In the interim, here are some highlights based upon our preliminary unaudited financial results for 2009:

• Strong Revenue Growth

In 2009, Medafor experienced an approximately 40% growth in revenue as compared to 2008. Unaudited revenues of $13.8 million for 2009 exceeded the business plan of $12.5 million by approximately 10%.

In the U.S., our fast growing general surgery distributor network achieved a revenue growth rate for 2009 that was well in excess of 120% for the year, and we are seeing impressive new daily growth in the use of our products in Urology and OB-GYN surgical applications. Further, our well established distributors in Japan and China achieved substantial revenue growth in 2009 of approximately 90% as compared to 2008, reflecting what appears to be enormous ongoing demand for our product in China, as well as the initial entry into Japan following successful receipt of regulatory clearance by the Japanese authorities.

The only decline in our overall net revenues came from those markets that are serviced by CryoLife. Revenues in those markets declined by approximately 40% as compared to the same sectors for 2008, after taking into account the transition of our then existing International network to CryoLife under the terms of the Exclusive Distribution Agreement (“EDA”), effective January 1, 2009.

• Operating Performance

Since receiving FDA approval in 2006, we have been focused on achieving positive operating cash flow from the sale of the MPH product as rapidly as possible. I am pleased to report that, consistent with that objective, Medafor’s cash based operating profit increased to approximately $2.4 million in 2009, representing a roughly 350% increase as compared to the comparative figure reported in 2008. Unfortunately, these operating profits were reduced by the very significant legal expenses we incurred in defending ourselves against the lawsuit initiated by CryoLife, which totaled over $1.2 million in total legal and associated fees for 2009. As a result, our basic operating income, though still strong due to steady margins and disciplined SG&A management, was reduced by about 50% to $1.2 million to reflect these litigation expenses. Therefore, net growth of operating profit was just over 120% in 2009.

• Improved Cash Position

From a balance sheet and liquidity point of view, we generated positive cash flow. Our cash position was further increased by a positive inflow arising from the debenture extension. Medafor therefore ended the year with approximately $1 million in cash on hand, and about $1 million in additional cash availability under an unutilized line of credit. Absent the legal fees caused by the CryoLife litigation, Medafor would have had $2 million in cash on hand.

Long Term Agreement with Magle Life Sciences

We are extremely pleased with our results for the year, and are even more excited for the future prospects that this positive momentum will bring to our Company. Now that our MPH product is generating strong operating cash flow, we are better equipped to turn our focus on expanding the range and scope of possible new surgical and medical applications.

With this in mind, we are delighted to share with you a very significant and exciting development regarding an expanded relationship with our long-term technology and supply partner, Magle Life Sciences of Sweden. As you may have read on our website and in the press release we issued on March 12^th, we recently signed a long term agreement with Magle, under which we have secured full control of the vital technology and manufacturing process needed to make the key powder component in our patented MPH surgical product.

In the past, ownership of the manufacturing process and technology resided overseas and was not within Medafor’s control. This agreement is a watershed event for our company and its future, and one which we believe will enable us to create greater value for Medafor shareholders in hemostasis and other initiatives long after the Hemarrest owned patent expires. By deepening our partnership with Magle, a company with a recognized strength in starch technology and research, we will be able to develop and enhance new applications of the MPH product, and strengthen our valuation prospects for a potential IPO or acquisition, if deemed appropriate.

Under this agreement, Magle will continue to exclusively supply Medafor with our DSM-A product for hemostasis on a long-term basis under favorable terms from both a pricing and minimum commitment point of view. This guarantees Medafor a quality long-term supply from a trustworthy and reliable partner. Medafor now also has the ability to create a second source of supply (with Magle’s active assistance).

For nearly a decade, our partnership with Magle has been built on a foundation of trust and mutual respect. We believe that Magle’s starch technology expertise, combined with Medafor's proven success penetrating the market for intra-operative surgical hemostasis products, is the ideal partnership arrangement as we continue executing our global growth strategy. The new agreement is particularly important because the prior agreement was expiring at the end of 2010. We began negotiating the contract renewal in 2009 and are very pleased that we were able to complete the negotiations expeditiously, while at the same time addressing the goals and objectives of both Medafor and Magle.

As consideration for acquiring this technology, we issued 1.8 million shares of Medafor stock to Magle, making Magle a significant shareholder in our company (approximately 7%) and further aligning their interests with those of our other Medafor shareholders. Based on reasonable expected revenue growth rates, the effective cost of the technology amortized over the next 10-15 years, will have a roughly 1% effect on net margins going forward. The cash savings we will generate from lowered mandatory minimum purchase commitments will offset the outlay for this technology, but much more importantly, as a single product/single technology company, we have finally secured perpetual control over our powder supply line and technology, which was previously threatened by the uncertainty surrounding CryoLife's actions.

Repudiation by CryoLife of the Exclusive Distribution Agreement

First, I would like to thank the many shareholders who have reached out to express their vocal support with regard to our Board’s recent actions taken in response to the unsolicited takeover attempt of our Company by CryoLife. We appreciate your continued confidence in Medafor, our strategic direction, and the promising future we see for our Company.

Now allow me to take a moment to bring you up to date on the status of our relationship with CryoLife and the EDA. On March 18^th, 2010, we informed CryoLife that it has repudiated our exclusive distribution agreement by failing to respond to our reasonable request for adequate assurance that it would properly adhere to the terms of our agreement. Under state law, CryoLife’s repudiation effectively permits Medafor to treat that contract as terminated and cease all performance under the EDA, effective immediately. Our March 18^th letter informed them that we intend to do so.

CryoLife has breached the terms of our agreement in China, Europe, Brazil and repeatedly in the U.S., and has continued to insist that it is somehow entitled to distribute HemoStase in China and Japan, despite the clear terms to the contrary set forth in the EDA. As a result of that action, we became highly concerned about whether CryoLife had any intention of honoring our agreement going forward, and we insisted it provide us assurance, as required by state law. CryoLife ignored this request, thus repudiating the contract.

Given their continuing actions and breaches of the EDA, we no longer believe that CryoLife can be viewed as a trustworthy partner, and worse, their actions confuse our customers which we believe is negatively impacting our future growth, thus impeding the overall objective of driving value for our shareholders. Thus, our Board unanimously determined that it is in the best interests of our shareholders to treat the EDA as though it has been terminated going forward.

As we have said in our previous communications, we will not engage in a public back-and-forth debate with CryoLife. However, we do recognize that you may have questions about the current situation and the allegations and personal attacks that CryoLife has been making. Therefore, we will continue to provide updates as warranted via the ongoing Questions and Answers section, which has been posted on our website and, if necessary, will be sent out in further mailings.

We have urged our shareholders, our customers and our employees not to be overly distracted by the noise CryoLife is making – be it via litigation, in letters to Medafor shareholders, or in the press. We view their aggressive campaign as nothing more than a sign of desperation on their part as they appear to be dealing with problems of their own making. As we have previously stated, it is becoming increasingly clear that our Hemostase MPH product is materially important to CryoLife’s business. However, what may be in the best interests of CryoLife and its shareholders, is not necessarily in the best interests of our Company, our future growth and our shareholders.

As always, please feel free to call me with any questions. Thank you for your ongoing support.

Sincerely,

Gary J. Shope

Chief Executive Officer

HyperBranch Medical Technology To Market Surgical Sealants under Adherus Product Name

DURHAM, N.C.--(BUSINESS WIRE)--HyperBranch Medical Technology, Inc. announced today that it will begin to market their surgical sealants under a new product identity – Adherus Surgical Sealants. The Adherus name will soon appear on all Company literature but the total transition in the market place will likely take several months to complete. “The new identity brings continuity to our products and allows the end users - doctors, hospitals and nurses - to refer more effectively to our family of products. This is not an unusual change for companies like HyperBranch as they transition from a development company to an established organization in the market, ” said John Conn, President and CEO. HyperBranch’s Adherus product line is a family of synthetic hydrogels which polymerize in a moist field, set immediately upon application, and bio-degrades as the tissue heals. Adherus Surgical Sealants are CE marked and approved for sale outside the United States for ophthalmic, cranial, spine and hernia applications. The Company has also recently completed enrollment of a US FDA pilot study for its Adherus Dural Sealant in preparation for the expanded pivotal trial of the same product. The Durham, N.C. medical device company has also been developing advanced surgical sealants for cardiovascular, pleural (lung), plastic surgery and other related surgical applications. These products are all at various stages of clinical and pre-clinical development and complement the existing CE Marked products. HyperBranch Medical Technology, a privately-held company based in Durham, N.C., is developing innovative medical devices for the ophthalmology, general, and specialty surgery markets. The company is focused on the development of unique products based on its novel hydrogel technology. For more information visit:www.hyperbranch.com.

Medafor Cryolife Agreement in Jeopardy

ATLANTA, March 19, 2010 /PRNewswire via COMTEX/ -- CryoLife, Inc. (NYSE: CRY), an implantable biological medical device and cardiovascular tissue processing company, today responded to Medafor's allegation that it has repudiated the Exclusive Distribution Agreement ("Agreement") between the two companies.

On March 18, 2010, Medafor informed CryoLife that it is treating the Agreement as terminated. Medafor alleges that it had reasonable grounds, pursuant to Georgia law, to demand that CryoLife provide adequate assurances that it would perform under the Agreement and that CryoLife has repudiated the Agreement by not providing adequate assurances. After completing its preliminary analysis, CryoLife believes that Medafor's position that it may treat the Agreement as terminated is not valid and that Medafor's request that CryoLife give adequate assurance of due performance under the Agreement was not reasonable or made in good faith.

This is Medafor's fourth attempt to terminate the Agreement. CryoLife is currently evaluating all of its options related to this most recent termination attempt by Medafor.

On March 16, 2010, CryoLife placed a purchase order of approximately $500,000 of HemoStase(R) product to be delivered to CryoLife on April 15, 2010. On March 18, 2010 after notifying CryoLife that it was treating the EDA as terminated, Medafor notified CryoLife that it would not fulfill this order because CryoLife submitted the order 30 days prior to shipment, instead of the minimum 35 days set forth in the Agreement and the amount requested was more than CryoLife had forecasted as set forth in the Agreement. Assuming Medafor's effort to deem of the Agreement as being terminated is not successful, CryoLife may simply submit a new purchase order.

If Medafor is ultimately successful in terminating the Agreement or if Medafor fails to ship HemoStase as ordered by CryoLife, CryoLife's previously issued financial guidance for fiscal 2010 may be materially affected.

In 2009, CryoLife filed a lawsuit against Medafor for, among other things, breach of contract, fraud, negligent misrepresentation, and violations of Georgia Racketeer Influenced and Corrupt Organizations Act ("Georgia RICO"), alleging that Medafor has violated the Agreement by, among other things, allowing other companies to distribute HemoStase in territories and medical fields reserved exclusively for CryoLife per the terms of the Agreement. CryoLife's lawsuit alleges that Medafor, contrary to its representations in the Agreement, had numerous distribution agreements regarding HemoStase with other distributors in the U.S. and internationally, allowing them to market and distribute HemoStase in the territory and field given exclusively to CryoLife. Medafor is alleged to have knowingly and purposefully withheld from CryoLife disclosure of all but three of these agreements; to have knowingly and purposefully misrepresented that the three distributors with these agreements would not be allowed to compete with CryoLife after the effective date of the Agreement except in several explicitly identified facilities, and then only for a short period of time; and to have intentionally misrepresented to CryoLife that no such contracts existed with any other distributors, and that no such contracts would exist after CryoLife's exclusive rights commenced. The lawsuit also alleges that Medafor has failed to take reasonable steps to prevent other distributors from distributing HemoStase in CryoLife's exclusive field and territory, and that Medafor breached its contractual obligation to prevent competing products from violating Medafor's intellectual property rights in HemoStase, thereby impairing the value of CryoLife's exclusive distributorship.

As specified in the lawsuit, CryoLife brought these transgressions to Medafor's attention on numerous occasions and attempted to work with Medafor to secure its compliance with the terms of the parties' Agreement, but was unable to get Medafor to follow the terms of the Agreement. CryoLife believes that Medafor's actions have deprived CryoLife of significant sales volume and have impaired and delayed CryoLife's development of relationships with customers in its exclusive territory.