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NUCRYST and Smith & Nephew Revise Agreements
Date:10/1/2007

WAKEFIELD, MA, Oct. 1 /PRNewswire-FirstCall/ - NUCRYST Pharmaceuticals Corp. today announced that on September 30, 2007 it signed amended agreements with Smith & Nephew wound management for the manufacture and sale of Acticoat(TM) dressings with SILCRYST(TM) nanocrystalline coatings. The two companies first entered into the agreements in 2001, when Smith & Nephew bought the Acticoat(TM) brand from NUCRYST and agreed to grant NUCRYST exclusive manufacturing rights, plus pay manufacturing cost reimbursement, a royalty on sales and milestone payments linked to agreed-upon sales and performance targets.

"The advanced wound care market, including the silver dressing segment, has become significantly more competitive since we signed the original agreements in 2001," said David C. McDowell, Vice President Operations for NUCRYST Pharmaceuticals. "As a result, both parties recognized the need to restructure the agreements to enable Smith & Nephew and NUCRYST to jointly support the continued growth of the Acticoat(TM) brand in the context of increasing competitive pressures."

Joe Woody, President of Smith & Nephew Advanced Wound Management commented "We are very pleased to maintain our long relationship with NUCRYST, in particular through Acticoat(TM) and nanocrystalline silver antimicrobial dressings which offers patients worldwide proven clinical benefits and an improved quality of life".

Highlights of the material changes made to the agreements include:

- Smith & Nephew will advance $5 million of a milestone payment to

NUCRYST in 2007.

- Under the previous agreements, the price paid by Smith & Nephew for

Acticoat(TM) products was NUCRYST's fully allocated cost of goods

sold including equipment depreciation. To provide Smith & Nephew with

greater costing certainty of the Acticoat(TM) product line, the

costing mechanism has been amended starting in 2007 to a fixed

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SOURCE NUCRYST Pharmaceuticals Corp.
Copyright©2007 PR Newswire.
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