American BioMed, Inc. announces business development agreement/strategic alliance with Diagnostic Ultrasound Corporation

Business Wire, May 27, 1997

THE WOODLANDS, Texas--(BW HealthWire)--May 27, 1997--American BioMed, Inc. (NASDAQ EBB:ABMI) today announced it has entered into a letter of intent with Diagnostic Ultrasound Corporation.

The multi-year business development agreement/strategic alliance is comprised of three project phases, project development, prototype and commercial production (OEM manufacturing) for the development and production of an antimicrobial Foley balloon catheter. Estimated OEM annual revenues to American BioMed, Inc. under the agreement are $2.5-5.0 million. Industry analysts estimated the worldwide market for Foley catheters to be approximately $500 million annually, and Diagnostic Ultrasound expects significant market share from this innovation.

The first two phases of the agreement include engineering and tooling design and prototype production. American BioMed, Inc. will provide its patented silicon manufacturing technologies while Diagnostic Ultrasound Corporation will contribute Implemed's patented OligonTM Technology and funding for the three phases. The antimicrobial Foley balloon catheter utilizes patented "Oligon(tm) Technology", which is licensed to Diagnostic Ultrasound by Implemed, Inc. Each project phase of the agreement requires sign-off by both companies and funding before the next project phase can begin. Phase I has been funded and development work in this phase has commenced.

Steven B. Rash, American BioMed, Inc.'s President and CEO, stated, "This agreement combines the use of one of American BioMed, Inc.'s patented technologies with Implemed's patented "Oligon(tm) Technology" in order to develop and manufacture an antimicrobial Foley catheter for Diagnostic Ultrasound to market. This strategic alliance creates a synergistic relationship for the three business partners, and more importantly afford the healthcare patient the benefits of the combined Technologies."

Gerald McMorrow, Diagnostic Ultrasound's President and CEO, stated, "Diagnostic Ultrasound chose to partner with American BioMed, Inc. because the Company was ideally situated to become a valuable partner in improving healthcare in America. American BioMed, Inc.'s patented silicone balloon manufacturing process and technology will enable the commercialization of the Oligon(tm) Technology. This partnership represents a potentially significant contribution to the medical field.

The most common nosocomial (hospital induced) infection is catheter associated urinary tract infection. The annual costs to the U.S. healthcare system approach $2 billion annually. Studies show that Diagnostic Ultrasound's BladderScan(tm) has been shown to reduce this infection in institutions by 50%. The patented antimicrobial delivery method Oligon(tm) technology will save our healthcare system more money and improve and extend the lives of many patients - let's put patients first."

American BioMed, Inc. utilizes state of the art technology to develop, manufacture and market minimally invasive medical, surgical and diagnostic devices which deliver unique advantages through advanced science. Over twenty-six patents cover its portfolio of technologies competing in an industry with a combined worldwide market estimated at over $10 billion annually.

Diagnostic Ultrasound is a world leader in developing, patenting, and marketing application specific Ultrasound devices such as the BladderScanTM.

CONTACT: Diagnostic Ultrasound Corporation American BioMed, Inc.

Gerald McMorrow Steve Rash

President & CEO President & CEO

425/867-1338 281/367-6895