Cyberonics Provides Business Update Based on Final Ambulatory Payment Classification Rate Change Announcem...( Company Reaffirms Fiscal ...),Health

Company Reaffirms Fiscal Year 2009 Revenue Guidance

HOUSTON, Oct. 31 /PRNewswire-FirstCall/ -- Cyberonics, Inc. (Nasdaq: CYBX) today announced that the Centers for Medicare and Medicaid Services (CMS) has published the 2009 CMS Outpatient Prospective Payment System (OPPS) Final Rule and Ambulatory Payment Classification (APC) rate for VNS Therapy. The final rule, which goes into effect January 1, 2009, sets reimbursement at $12,545 for insertion of VNS Therapy generators and $7,234 for insertion of associated leads. The final rates are higher than those proposed in July. The current reimbursement rates for VNS Therapy generators and leads are $11,877 and $14,061, respectively.

Although the actual impact of the new reimbursement rates on Cyberonics' business is difficult to quantify at this time, the company continues to expect net sales for fiscal year 2009 of $134 million to $138 million.

"We agree with the Outpatient Advisory Panel's conclusion that emphasized the need for CMS to omit from its analysis certain data that was included incorrectly or that is not applicable to the current CMS-approved procedure," said Dan Moore, Cyberonics' President and Chief Executive Officer. "Therefore, we intend to continue working with CMS to address possible payment inadequacies related to VNS Therapy. This includes providing more accurate claims information to CMS and working with epilepsy support and advocacy groups, as well as key physician thought leaders in the field, to ensure that the safety, efficacy and overall cost-benefit profile of VNS Therapy is well understood. It is important to reiterate that we remain confident in our ability to continue growing our epilepsy business."

About Cyberonics, Inc. and VNS Therapy(TM)

Cyberonics, Inc. (NASDAQ: