Regenerative Medicine

 News Release - March 8, 2010

Osteotech's MagniFuse(TM) Distributed to 68 U.S. Hospitals as Product Revenue Surpasses $1 Million

National Launch on Target to begin in Second Quarter 2010

EATONTOWN, N.J., March 8 (Healthcare Sales & Marketing Network) -- Osteotech, Inc. (Nasdaq:OSTE ), a leader in the emerging field of biologic products for regenerative healing, announced today that its MagniFuse™ bone graft has generated its first $1 million in revenue during the four month period beginning with the limited launch of the product in late October 2009. Osteotech began the first phase of its strategic limited launch of MagniFuse with the release of three procedure specific forms for posterior cervical and posterolateral spine fusion and spinal deformity procedures. Since that time, the Company has successfully executed its multi-step launch strategy and will highlight a national launch at the upcoming American Academy of Orthopaedic Surgeons Annual Meeting in New Orleans, Louisiana.

"We are pleased with the initial, positive surgeon feedback on MagniFuse and based on the convergence of science, technology and economic benefit, we believe MagniFuse's unique characteristics can redefine the area of bone grafting," said Sam Owusu-Akyaw, Osteotech's President and Chief Executive Officer. "We are equally pleased with the high level of enthusiasm among our sales team as they become educated on MagniFuse's unique features, benefits and competitive price point. Similarly, we are also rapidly gaining traction in the broader surgeon community as the clinical benefits of MagniFuse become more widely known. The preliminary human clinical data from the first MagniFuse surgical case just became available and appears to show robust bone formation in a posterolateral spine fusion at the six-month time point. We believe this early data, complemented by the non-human clinical data we already have and an exceptional product value proposition, will all converge and support continued adoption of MagniFuse by surgeons as a go-to biologic for advanced bone grafting procedures."

About MagniFuse

MagniFuse, which has received clearance from the United States Food and Drug Administration, is Osteotech's new, patented bone graft technology platform that supports a family of products for use when injury or disease creates a need for bone fusion or new bone growth. The MagniFuse technology platform has a number of distinguishing characteristics:

• Delivered in a unique, resorbable self-contained delivery system, MagniFuse provides an optimized scaffold that creates a highly exposed surface area comprised of 100% bone material that is shaped and oriented to provide guided bone healing.
• Based upon Osteotech's proprietary processing and manufacturing technologies, MagniFuse's patented formulation is derived from allograft source material that contains a higher concentration of multiple natural human growth factors.
• MagniFuse's self-contained delivery system also allows for targeted bone formation because it reduces graft site migration once implanted.
• MagniFuse is also visible in radiographs, thus providing evidence of its proper placement during and after surgery.

These characteristics and others solve many of the challenges associated with currently marketed competitive products.

About Osteotech

Osteotech, Inc., headquartered in Eatontown, New Jersey, is a global leader in providing biologic solutions for regenerative medicine to support surgeons and their patients through the development of innovative therapy-driven products that alleviate pain, promote regenerative and biologic healing and restore function. For further information regarding Osteotech or this press release, please go to Osteotech's website at http://www.osteotech.com/.

Certain statements made throughout this press release that are not historical facts are forward-looking statements (as defined in the Private Securities Litigation Reform Act of 1995) regarding the Company's future plans, objectives and expected performance. Any such forward-looking statements are based on assumptions that the Company believes are reasonable, but are subject to a wide range of risks and uncertainties and, therefore, there can be no assurance that actual results may not differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to, the Company's ability to develop and introduce new products, differences in anticipated and actual product and service introduction dates, the ultimate success of those products in the marketplace, the continued acceptance and growth of current products and services, the impact of competitive products and services, the availability of sufficient quantities of suitable donated tissue and the success of cost control and margin improvement efforts. Certain of these factors are detailed from time to time in the Company's periodic reports filed with the Securities and Exchange Commission. All information in this press release is as of March 8, 2010 and the Company does not intend to update this information.

Source: Osteotech

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