Healthcare Industry News:  demineralized bone matrix 

Devices Neurosurgery Orthopaedic

 News Release - July 11, 2006

Alphatec Holdings, Inc. Adds Bone Growth Stimulator to Spinal Product Line

Signs Private Label Distribution Agreement With IsoTis for demineralized bone matrix Products

CARLSBAD, Calif., July 11 (HSMN NewsFeed) -- Alphatec Holdings, Inc. (Nasdaq: ATEC ), a medical device company that provides customized spinal products and a broad suite of spine fusion solutions, announced today that it has signed a private label distribution agreement with IsoTis OrthoBiologics (SWX/Euronext: ISON; TSX: ISO) for distribution of IsoTis's demineralized bone matrix ("DBM") products under Alphatec's brand name. These well-established DBM products, currently sold under the IsoTis brand names of DynaGraft® II and OrthoBlast® II, have osteo-inductive properties which stimulate new bone formation and can be used in combination with traditional spinal implants to stabilize the spine following spine fusion procedures. Under the agreement, which has certain minimum order quantity requirements, Alphatec has placed an initial order that should allow for commercial sale through Alphatec's distribution base by the fourth quarter of this year.

"Many patients who undergo surgery using Alphatec's high quality spinal screws and spacers can benefit from the use of IsoTis's DBM products," said Ronald G. Hiscock, President and Chief Executive Officer of Alphatec. "Surgeons who might have looked to other vendors for this product will now be able to use Alphatec's own private label brand. This addition to our product line is an ideal complement and one that allows us to better serve our surgeon's total requirements while limiting their need to look elsewhere."

Hiscock added, "This agreement demonstrates again our commitment to providing a full breadth of product to serve the needs of the spinal fusion marketplace. Alphatec has moved aggressively to expand its product portfolio to include both new technologies and, importantly, many product alternatives that meet the diverse needs of the surgeon community. Because other DBM's are being used today with Alphatec's products, we believe that the potential exists to quickly assimilate a new, branded Alphatec DBM into our mix of surgeries, thereby increasing revenue per surgery."

About Alphatec

Alphatec is a medical device company focused on the design, development, manufacturing and marketing of products for the surgical treatment of spine disorders. Alphatec's principal product offering is primarily focused on the estimated $2.2 billion U.S. spine fusion market through its wholly-owned subsidiary, Alphatec Spine, Inc., and includes a variety of spinal implant products and systems comprised of components such as spine screws, spinal spacers, and plates that offer multiple solutions to address patients' needs. In addition to Alphatec's U.S. presence, it also participates in the Japanese spine fusion and orthopedic trauma markets through its subsidiary, Alphatec Pacific, Inc. Our mission is to be a value based leader in the spinal market by providing unmatched service to and taking scientific direction from our physician customers. We do so through our unique in-house manufacturing facility in Carlsbad, California that allows us to respond quickly and to customize innovative products needed for spine fusion surgery.

About IsoTis

IsoTis OrthoBiologics has a product portfolio with several innovative and proprietary natural and synthetic bone graft substitutes on the market and others in development, an established North American independent distribution network, and an expanding international presence. The company's main commercial operations are based out of Irvine, CA; its international sales headquarters is based in Lausanne, Switzerland.

Forward Looking Statements

This press release may contain forward-looking statements that involve risks and uncertainty, including statements that Alphatec's commercial sale of such private label DBM products will occur in the fourth quarter of 2006, that many of Alphatec's surgeries are candidates for use with a DBM product, that surgeons will adopt our private label DBM products, and that our private label DBM products will provide complementary revenues by increasing our revenue per surgery. Such statements are based on management's current expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Alphatec cautions investors that there can be no assurance that actual results or business conditions will not differ materially from those projected or suggested in such forward-looking statements as a result of various factors, including, but not limited to, the following: Alphatec's ability to develop and expand its spine fusion business in the United States and Japan, Alphatec's ability to expand and maintain a successful sales and marketing organization, continuation of favorable third party payor reimbursement for procedures performed using our products, unanticipated expenses or liabilities or other adverse events affecting cash flow or Alphatec's ability to achieve profitability, uncertainty of additional funding, uncertainty of success in developing any new products, failure to successfully introduce and develop new products, including products related to the dynamic cervical plate license agreement and the other license agreements, failure to obtain FDA clearance or approval for particular devices, Alphatec's ability to compete with other competing products and with emerging new technologies within and outside of spinal fusion, product liability exposure and patent infringement claims. Please refer to the risks detailed in Alphatec's Form S-1 on file with the SEC, as well as the risks detailed from time to time in Alphatec's SEC reports, including quarterly reports on Form 10-Q, reports on Form 8-K and annual reports on Form 10-K. We disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, unless required by law.

Source: Alphatec

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