Healthcare Industry News:  Edwards Lifesciences 

Devices Licensing

 News Release - September 18, 2006

Somanetics Signs Contract Development and Exclusive Licensing Agreement for Several Novel Technologies

TROY, Mich., Sept. 18 (HSMN NewsFeed) -- Somanetics Corporation (Nasdaq: SMTS ) today announced that it has entered into a Contract Development and Exclusive Licensing Agreement with NeuroPhysics Corporation of Shirley, Mass. The agreement provides Somanetics with feasibility research, contract development and consulting services and certain ownership and licensing rights to intellectual property and technical knowledge associated with several novel near-infrared spectroscopy ("NIRS") and imaging technologies and products under development at NeuroPhysics. Somanetics will pay an initial license fee of $1 million, monthly license fees beginning April 1, 2008 for products continuing under development at NeuroPhysics and a royalty on any future sales.

"This agreement is an important step toward achieving our goals of sustaining meaningful and long-term technological advantage in our core competence of depth-resolved NIRS, expanding the market for the technology to new applications, and broadening our portfolio of predominately NIRS-based products," said Bruce Barrett, Somanetics' president and chief executive officer. "This collaboration with NeuroPhysics is a significant opportunity for us to pursue an array of new product opportunities. We believe these potential new products hold the promise of increasing the long-term potential of our business."

Somanetics' core INVOSĀ® (in vivo optical spectroscopy) technology is based on the concepts of depth-resolved NIRS, a method of separately measuring light photons that scatter to different depths of penetration. The INVOS technology is used in Somanetics' INVOS Cerebral/Somatic Oximeter System, a noninvasive oximetry system that has the capability to monitor changes in regional blood oxygen saturation in both cerebral and skeletal muscle (somatic) tissue.

NeuroPhysics is in the early stage of feasibility research and development of several NIRS-based technologies and products, including a novel approach to depth-resolved NIRS measurements. NeuroPhysics' approach has the potential to substantially advance, differentiate and complement Somanetics' INVOS technology.

In addition to this NIRS-based depth-resolved technology, products under development at NeuroPhysics include a fetal cerebral oximetry system; a monitor for measuring oxygen saturation in deep tissues for assessing hemorrhagic shock; devices to assess tumors or swelling containing blood, including in the brain of head trauma victims, and neonates with intra- ventricular hemorrhage; a continuous and non-invasive blood gas monitor; and a new imaging concept intended to improve resolution and expand the applicability of endoscopes.

"This agreement allows our internal focus to continue to be on executing our business and capitalizing on the expanding adult, pediatric and neonatal market opportunities for the INVOS System, while NeuroPhysics provides additional resources for our development of a pipeline of future products," Barrett said.

About NeuroPhysics

NeuroPhysics is a privately-held technology company in the business of developing unique products for the medical market. Its principals have extensive background in physics, engineering, and research in instrumentation, electronics and imaging.

About Somanetics

Somanetics Corporation (Nasdaq: SMTS ) develops, manufactures and markets medical devices that can help medical professionals potentially improve surgical outcomes and patient recovery in critical care settings. Somanetics currently has two product lines. The INVOSĀ® System provides noninvasive regional blood oxygenation change data that helps address clinical challenges faced by surgeons, anesthesiologists, perfusionists and critical care nurses. The CorRestore System is used in cardiac repair and reconstruction, including an operation called Surgical Ventricular Restoration (SVR) for the treatment of certain patients with severe congestive heart failure. Somanetics supports its customers through a direct U.S. sales force and clinical education team. Globally, Tyco Healthcare markets INVOS System products in Europe, Canada, the Middle East and Africa and Edwards Lifesciences represents INVOS System products in Japan. For more information visit .

Safe-Harbor Statement

Except for historical information contained herein, the matters discussed in this news release, including the prospects for new products and their development, are forward-looking statements, the accuracy of which is necessarily subject to risks and uncertainties. Actual results may differ significantly from results discussed in the forward-looking statements and may be affected by, among other things, economic conditions in general and in the healthcare market, the demand for and market acceptance of our products in existing market segments and in new market segments we plan to pursue, our current dependence on the Cerebral Oximeter and SomaSensor, our dependence on distributors and independent sales representative firms for a substantial portion of our sales, our dependence on single-source suppliers, potential competition, the effective management of our growth, our ability to attract and retain key personnel, the potential for products liability claims, government regulation of our business, the challenges associated with developing new products and obtaining and maintaining regulatory approvals if necessary, research and development activities, the lengthy sales cycle for our products, changes in our actual or estimated future taxable income, enforceability and the costs of enforcement of our patents, potential infringements of others' patents and the other factors set forth from time to time in Somanetics' Securities and Exchange Commission filings including Somanetics' 2005 Annual Report on Form 10-K filed on January 31, 2006 and its first and second quarter 2006 Quarterly Reports on Form 10-Q filed on March 31, 2006 and June 30, 2006.

Source: Somanetics

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