BioSphere Medical Announces First Quarter Results; 15% Growth in U.S. Embolics and Delivery System Revenue

Conference call to be held April 30 at 8:30 a.m. Eastern time
ROCKLAND, Mass.--(Business Wire)--
BioSphere Medical, Inc. (NASDAQ:BSMD) ("BioSphere" or the "Company") - a medical
device company that has pioneered the use of bioengineered microspheres to treat
uterine fibroids, hypervascularized tumors and vascular malformations by a
minimally invasive, image-guided medical procedure called embolotherapy - today
reported financial results for the three months ended March 31, 2009. Highlights
of the first quarter of 2009 and subsequent weeks include:

* Total U.S. embolics and delivery systems revenue was $5.7 million, an increase
of 15% over the same period in 2008
* Total worldwide embolics and delivery systems revenue was $7.2 million, an
increase of 10% over the same period in 2008
* Total revenue from phased-out gastric products was negligible, compared with
$0.6 million in the first quarter of 2008
* Total worldwide revenue was $7.3 million, an increase of 1% from the same
period in 2008
* Clinical data presented at the January 2009 International Symposium on
Endovascular Therapy (ISET) meeting reported that 34 patients with primary liver
cancer demonstrated an objective tumor response of 79% at six months when
treated with HepaSphere Microspheres loaded with doxorubicin
* Highlights from 2009 Society of Interventional Radiology (SIR) meeting: Dr.
David M. Liu and colleagues` (University of British Columbia, UCLA Medical
Center, and Northwestern University) presentation on HepaSphere`s active uptake
and release of doxorubicin in an ex vivo study establishing drug delivery proof
of concept that supports ongoing successful clinical experience with HepaSphere;
Dr. Jean-Francois Geschwind`s (Johns Hopkins University) presentation, which
included preliminary results from a phase II, prospective, single-arm clinical
trial investigating the effectiveness of combining bevicizumab (Avastin), a
monoclonal antibody VEGF-inhibitor, with conventional transarterial
chemoembolization (TACE), employing Embosphere Microspheres, for the treatment
of unresectable hepatocellular carcinoma. Of the 19 patients followed for a
median of 12 months after treatment, no disease progression was reported in 100%
of patients, according to European Association for the Study of the Liver (EASL)
criteria (59% demonstrated complete or partial response and 41% maintained
stable disease). Enrollment of the targeted 30 patients is nearly complete at
this time.
* Signed an exclusive agreement in April 2009 with Nippon Kayaku Co., Ltd. for
the distribution of HepaSphere Microspheres and Embosphere Microspheres in
Japan

Commentary

Richard Faleschini, BioSphere`s president and chief executive officer, said,
"Our first quarter results, which featured a 15% increase in U.S. embolics and
delivery systems revenue, is a good outcome for us, reflecting progress with the
marketing and sales programs we`ve initiated to grow our business. We believe
our U.S. UFE initiatives provide significant benefits for our key business
stakeholders-interventional radiologists, hospital and service line
administrators, gynecologists, and women with symptomatic fibroids. As we
continue to strive to optimize our execution, we expect to see further growth in
the U.S. because we believe that UFE can be favorable for these constituencies.
Our business outside the U.S., on a year-over-year basis, is beginning to
recover from the economic collapse in the last half of 2008.

"The clinical evidence for interventional oncology has become more compelling
for embolotherapy in general and drug-eluting embolization in particular.
Publications in the last half of 2008 and podium presentations thus far in 2009
by Drs. Jeff Geschwind, Maurizio Grosso, David Liu, and Guido Poggi about our
Embosphere Microspheres and HepaSphere Microspheres are helping to build our
clinical position in interventional oncology. Over the course of 2009, we expect
to see additional publications about these products that will support further
development of our interventional oncology clinical platform."

Mr. Faleschini concluded, "This quarter we are pleased to have entered into an
exclusive agreement with Nippon Kayaku Co., Ltd. for the distribution of
HepaSphere Microspheres and Embosphere Microspheres in Japan. Nippon Kayaku is a
leading, well-respected fine chemical and pharmaceutical company with a
substantial oncology franchise. We are confident that they are well positioned
to gain regulatory approval for our products and drive market adoption.

"Overall, we believe we have achieved several important goals we set for
ourselves this quarter, and thus continue to build the underlying value of the
Company."

Financial Results

Total revenue for the first quarter of 2009 was $7.28 million, an increase of 1%
compared with $7.21 million for the first quarter of 2008. Revenue from gastric
products, which were phased out last year, was negligible in the first quarter
of 2009, compared with $0.57 million in the first quarter of 2008. Total revenue
from sales of embolics and delivery systems for the first quarter of 2009 was
$7.18 million, up 10% from $6.54 million in the prior year.

Product revenue from sales of embolics and delivery systems in the U.S. for the
first quarter of 2009 was $5.68 million, an increase of 15% compared with $4.96
million in the first quarter of 2008. Product revenue from sales of embolics and
delivery systems in Europe, the Middle East and Africa (EMEA) in the first
quarter of 2009 was $1.16 million, a decrease of 4% compared with $1.21 million
for the same period in 2008. The revenue decline was due to the impact of the
stronger U.S. dollar during the quarter. In local currency, EMEA product revenue
rose 9%. In markets outside of the United States and EMEA, revenue was $0.34
million for the first quarter of 2009, compared with $0.37 million for the same
period in 2008, a decrease of 8%.

Gross profit rose to $5.44 million, or 74.7% of revenue, for the first quarter
of 2009, compared with gross profit of $5.17 million, or 71.7% of revenue, for
the first quarter of 2008.

Operating expense for the first quarter of 2009 was $7.28 million, compared with
$6.52 million for the first quarter of 2008. The increase was primarily due to
higher research and development expense in connection with the conclusion of our
manufacturing process improvement program with DuPont, higher marketing costs in
the U.S. and higher legal fees compared to the same period last year.

Operating loss for the first quarter of 2009 was $1.84 million, compared with
$1.35 million for the first quarter of 2008.

Net interest income for the first quarter of 2009 was negligible, compared with
net interest income of $0.17 million for the first quarter of 2008, reflecting
the near zero interest rate on treasury securities, which make up the majority
of the Company`s investment portfolio. Foreign exchange gain for the first
quarter of 2009 was $0.20 million due to the strengthening of the U.S. dollar
against the euro, compared with a foreign exchange loss of $0.22 million for the
first quarter of 2008.

The quarterly preferred stock dividend for the first quarter of 2009 was $0.15
million, unchanged from the first quarter of 2008.

Net loss applicable to common stockholders for the first quarter of 2009 was
$1.79 million, or $0.10 per share, compared with a net loss applicable to common
stockholders of $1.55 million, or $0.09 per share, in the same period last year.

As of March 31, 2009, BioSphere had cash, cash equivalents and marketable
securities of $15.99 million. In the first quarter of 2009, BioSphere made a
payment of $1.37 million to L` Assistance Publique Hôpitaux de Paris, or APHP,
for royalties and Value Added Tax, or VAT, in France, which was accrued during
2008 for Embosphere and EmboGold Microspheres. Historically, this payment has
been made in the first quarter of the subsequent year for the prior year`s
full-year royalty and VAT liability.

Sales by therapeutic area in the first quarter of 2009 were as follows:

* Worldwide sales of embolics used in interventional gynecology, or UFE, rose 8%
to $5.25 million compared with the first quarter of 2008, which includes U.S.
sales of $4.35 million, an increase of 11%, and sales outside of the U.S. of
$0.90 million, a decrease of 5%.
* Worldwide sales of embolics used in interventional oncology rose 18% to $1.60
million compared with the first quarter of 2008, which includes U.S. sales of
$1.16 million, an increase of 30%, and sales outside of the U.S. of $0.44
million, a decrease of 5%.
* Worldwide sales of delivery systems rose 2% to $0.33 million compared with the
first quarter of 2008, which includes U.S. sales of $0.17 million, an increase
of 12%, and sales outside of the U.S. of $0.16 million, a decrease of 8% from
the first quarter of 2008.

Conference Call and Webcast

The Company will host a conference call to discuss these results and answer
questions on April 30, 2009 beginning at 8:30 a.m. Eastern time. The dial-in
number is 1-888-563-6275 (US/Canada) or +706-643-3137 (International), and the
conference ID is 95295182. The live webcast will be available in the "Investors"
section of BioSphere`s Web site at www.biospheremed.com. A replay of the webcast
will also be available at BioSphere`s Web site.

About BioSphere Medical, Inc.

BioSphere Medical, Inc. seeks to pioneer and commercialize minimally invasive
diagnostic and therapeutic applications based on proprietary bioengineered
microsphere technology. The Company's core technologies, patented bioengineered
polymers and manufacturing methods, are used to produce microscopic spherical
materials with unique beneficial properties for a variety of medical
applications. BioSphere's principal focus is the treatment of symptomatic
uterine fibroids using a procedure called uterine fibroid embolization, or UFE.
The Company's products continue to gain acceptance in this rapidly emerging
procedure, as well as in a number of other new and established medical
treatments.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, including, without limitation,
statements regarding the Company`s expectation for revenue growth in 2009 and
beyond, the expected benefits of the Company`s sales and marketing strategies,
the Company`s plans for growing its interventional oncology business, and the
Company`s expectations regarding the benefits of its agreement with Nippon
Kayaku. The Company may use words such as "plans," "seeks," "projects,"
"believes," "may," "anticipates," "estimates," "should," "intends," "looking
forward," and similar expressions to identify these forward-looking statements.
These statements are subject to risks and uncertainties and are based upon the
Company's beliefs and assumptions. There are a number of important factors that
may affect the Company's actual performance and results and the accuracy of its
forward-looking statements, many of which are beyond the Company's control and
are difficult to predict. These important factors include, without limitation,
risks relating to:

* the failure of the Company to successfully develop, commercialize and achieve
widespread market acceptance of its products, including, without limitation,
widespread market acceptance of its Embosphere Microspheres, for the treatment
of UFE, its HepaSphere Microsphere and QuadraSphere Microsphere products, and
its delivery system product line;
* the failure of the Company to increase the rate of UFE procedures, and
concomitant use of its products for UFE, with its sales and marketing
strategies;
* the failure of the Company to achieve or maintain necessary regulatory
approvals, either in the United States or internationally, with respect to the
manufacture and sale of its products and product candidates, including, without
limitation, the risk that the Company will not gain necessary regulatory
approvals to market and sell its products in Japan through its agreement with
Nippon Kayaku;
* the Company`s ability to obtain and maintain patent and other proprietary
protection for its products and product candidates;
* the absence of, or delays or cancellations of, product orders;
* delays, difficulties or unanticipated costs in the introduction of new
products;
* competitive pressures and the risk of product liability claims, either of
which may impact market acceptance of products and adversely affect the
Company`s operating results;
* the inability of the Company to successfully execute on its plans and
strategies for future growth, including its plans to grow its business in both
the UFE and interventional oncology fields and its plans for international
growth;
* the inability of the Company to raise additional funds in the near term to
finance the development, marketing, and sales of its products;
* general economic and market conditions, both domestic and abroad; and
* risk factors described in the section titled "Risk Factors" in the Company's
Annual Report on Form 10-K for the year ended December 31, 2008, as filed by the
Company with the Securities and Exchange Commission, and described in other
filings made by the Company from time to time with the Securities and Exchange
Commission.

In addition, the forward-looking statements included in this press release
represent the Company`s estimates as of the date of this release. The Company
anticipates that subsequent events and developments may cause its
forward-looking statements to change. The Company specifically disclaims any
obligation or intention to update or revise these forward-looking statements as
a result of changed events or circumstances after the date of this press
release.

BioSphere Medical, Inc.
SELECTED FINANCIAL INFORMATION

CONSOLIDATED CONDENSED BALANCE SHEETS
As of March 31, 2009 and December 31, 2008
(in thousands, unaudited)

March 31, December 31,
2009 2008
ASSETS
Cash, cash equivalents and investments $ 15,993 $ 18,239
Accounts receivable, net 5,001 4,729
Inventories 3,426 3,762
Prepaid expenses and other current assets 935 663
Property and equipment, net 962 989
Goodwill 1,443 1,443
Other assets 394 403

Total assets $ 28,154 $ 30,228

LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable and accrued expenses $ 5,012 $ 5,402
Deferred revenue 42 63
Capital lease obligations 15 17
Stockholders' equity 23,085 24,746

Total liabilities and stockholders' equity $ 28,154 $ 30,228

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
For the three months ended March 31, 2009 and 2008
(in thousands, except per share amounts, unaudited)

Three Months Ended
March 31,
2009 2008

Revenues $ 7,283 $ 7,214

Costs and expenses:
Cost of revenues 1,840 2,043
Research and development 985 647
Sales 2,718 2,652
Marketing 1,513 1,323
General, administrative and patent costs 2,069 1,903

Total costs and expenses 9,125 8,568

Loss from operations (1,842 ) (1,354 )
Other income and expenses, net 202 (47 )

Net Loss (1,640 ) (1,401 )

Preferred stock dividends (145 ) (145 )

Net loss applicable to common stockholders $ (1,785 ) $ (1,546 )

Net loss per common share
Basic and diluted $ (0.10 ) $ (0.09 )

Weighted average common shares outstanding
Basic and diluted 18,012 17,962

Company Contact:
BioSphere Medical, Inc.
Martin Joyce, EVP & CFO
781-681-7925
www.biospheremed.com
or
Investor Relations Contacts:
Lippert/Heilshorn & Associates, Inc.
Kim Golodetz, 212-838-3777
kgolodetz@lhai.com
Bruce Voss, 310-691-7100
bvoss@lhai.com

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