Advanced Neuromodulation Systems Announces Promising Results in Depression Research Study; Article Published in Neuron

Business Wire, March 3, 2005

DALLAS -- Advanced Neuromodulation Systems, Inc. (ANS) (NASDAQ:ANSI) today announced the publication of a research paper in the well-respected neuroscience journal Neuron showing promising new results in a depression research study using a method of deep brain neurostimulation. The paper, authored by noted clinical researchers including the inventors, reports "a striking and sustained remission of depression in four of six patients." ANS acquired the exclusive rights to this intellectual property over a year ago.

The six month research study, conducted by the investigators at the University of Toronto independent of participation by or funding from ANS, was based on the preliminary observations that a particular region of the brain (the subgenual cingulate region, or Broadmann area 25) is metabolically overactive in treatment-resistent depression. The investigators studied whether electrical stimulation of that region could reduce the elevated activity and produce clinical benefit. Six patients with refractory depression were implanted and followed for six months.

Continuous stimulation of these specific brain structures demonstrated that high-frequency DBS of the target area can produce striking antidepressive changes in patients with treatment-resistant depression, the article reports. In addition, "sustained clinical improvement decreased with blinded discontinuation of chronic DBS and were recaptured with reinstitution of stimulation, providing evidence as to the specificity of DBS-mediated changes." The investigators noted that the antidepressant effects were accompanied by a marked reduction in local cerebral blood flow as well as changes in downstream limbic and cortical sites, as measured using PET scans, meaning that the effects of stimulation can be visually observed and recorded. The investigators stated that the study suggests that disrupting brain circuitry in this region by using electrical stimulation "can effectively reverse symptoms in otherwise treatment-resistent depression."

Treatment-resistant depression, or TRD, is a severely disabling disorder with no proven treatment options once multiple medications, psychotherapy and electroconvulsive therapy have failed. The National Institutes of Health (NIH) estimate that 9.9 million adult Americans suffer from major depressive disorder. Research indicates that approximately 20% of these patients are resistant to existing treatments. Approximately 100,000 people in the United States are treated with electroconvulsive therapy (ECT) each year.

"We will be quick to caution that these results cover only six patients, follow-up was limited, and no sham surgery or systematic placebo control arm was used. Despite these and other limitations in this research study, the response rate in these patients is striking given their extreme resistence to other treatments and the well-documented low placebo response in these patients. What is particularly impressive is the sustained response in four of the six patients. Based on the strength of this research study, we are pursuing a multi-center feasibility study to further evaluate the clinical benefit of electrical stimulating Broadmann area 25 in treatment-resistant depression. If the expanded study continues to impress, ANS intends to pursue a pivotal trial for this important application," said Chris Chavez, President and Chief Executive Officer of ANS.

ANS' United States and PCT patent applications for this indication have already published. "We considered the FDA's decision regarding the approvability of Cyberonics' vagal nerve stimulation therapy in February 2005 as a long-term adjunctive treatment for certain TRD patients a major step forward in the development of neurostimulation as a treatment for this indication. We intend to learn from Cyberonics' experiences with the FDA and benefit from them as we pursue a DBS therapy," Mr. Chavez added.

"As we recently stated in our earnings release, we have made the strategic decision to accelerate our pursuit of new indications for our technology more aggressively, by accelerating clinical studies, regulatory approval efforts and product development. DBS for treatment-resistent depression is a prime example of an indication that merits this kind of accelerated investment and focus. We remain focused on profitable bottom-line performance and growth in our core pain business, but increasing our investment in clinical studies, regulatory and R&D by as much as $5 million in 2005 is merited by these kinds of emerging indications and opportunities," said Mr. Chavez.

About Advanced Neuromodulation Systems

Advanced Neuromodulation Systems designs, develops, manufactures and markets implantable systems used to manage chronic intractable pain and other disorders of the central nervous system. Fortune magazine recently ranked ANS as the 8th fastest growing small company in its annual list of the Top 200 Fastest Growing Small Companies in the United States. Forbes magazine recently recognized ANS as one of America's 200 Best Small Companies. Frost & Sullivan, an international strategic market research firm, also recently presented ANS with its Product Innovation Award, recognizing ANS as the technology innovation leader in the neurostimulation market and ANS' Genesis(R) Implantable Pulse Generator system as the most advanced fully implantable spinal cord stimulator on the market. Additional information is available at www.ans-medical.com.