Derma Sciences Novel XTRASORB® HCS Dressings Receive Federal Reimbursement Codes; Join Foam and Classic Dressings for Complete Coverage of Product Category

PRINCETON, N.J.--(BUSINESS WIRE)--Derma Sciences, Inc. (Nasdaq: DSCI), a medical device and pharmaceutical company focused on advanced wound care, announces that all five products in its novel line of XTRASORB® HCS Dressings have received Healthcare Common Procedural Coding System (HCPCS) codes. These codes – A6234 through A6238 – were awarded by the Centers for Medicare and Medicaid Services (CMS), and allow healthcare providers to bill for the dressings beginning immediately. XTRASORB HCS makes use of a patented super absorbent polymer hydrocolloidal suspension within a hydrogel matrix. Owing to this unique combination, the dressings can be used on dry wounds all the way to moderately exuding wounds – acting as a “smart dressing” by providing moisture when the wound is dry and by absorbing moisture when the wound is exuding. With the awarding of these reimbursement codes, Derma Sciences has codes that cover its entire XTRASORB product line, including XTRASORB Foam for treatment of moderate to heavily exuding wounds and XTRASORB Classic, for heavily and extra heavily exuding wounds.

Derma Sciences Chairman and Chief Executive Officer Edward J. Quilty said, “With reimbursement in place and product now in our distribution center, we are confident that demand for the new XTRASORB line extensions will be robust. XTRASORB HCS is able to absorb as much as four times the amount of wound drainage as leading hydrocolloids dressings currently on the market. Additionally, given its unique ability to management two different wound environments, we anticipate that XTRASORB HCS will provide savings to the health care system by taking the place of two dressings. The dressings will permit fewer dressing changes due to significantly higher absorption, requiring less nursing time, and potentially leading to better healing outcomes due to less disruption of the wound bed. Sales of these products began this month, and we expect them to contribute to our overall Advanced Wound Care sales moving forward.”

HCPCS codes are used by Medicare and monitored by CMS. They are based on the Current Procedural Technology (CPT) codes developed by the American Medical Association. Wound dressings and other supplies cannot be reimbursed through Medicare without set HCPCS codes. Additionally, most private health insurance companies follow the lead of Medicare with these types of products. Derma Sciences estimates that approximately 50% of the potential market for XTRASORB relies on HCPCS codes.

About XTRASORB

XTRASORB is a line of novel super-absorbent wound dressings. The core super-absorbent polymer technologies dramatically improve the capabilities of the dressings versus conventional moist wound dressings. Whereas other absorbent dressings (including foams, abd pads, and other cellulose-based dressings) rely on spaces within the dressings to fill with fluid, XTRASORB’s super-absorbent polymers bind fluid and convert it to a gel. The distinct advantages this offers over traditional first-line dressings are:

• XTRASORB dressings are able to hold more fluid
• XTRASORB dressings lock fluid inside the dressing, helping to decrease the risk of maceration
• XTRASORB dressings lock fluid inside the dressing, helping to keep the harmful contents within wound fluid away from the wound & periwound skin

About Derma Sciences, Inc.

Derma Sciences is a medical technology company focused on three segments of the wound care marketplace, traditional dressings, advanced wound care dressings and pharmaceutical wound care products. Its MEDIHONEY® product is the leading brand of honey-based dressings for the management of wounds and burns. The product has been shown to be effective in a variety of indications, and was the focus of a positive large-scale, randomized controlled trial involving 108 leg ulcer patients. Other novel products introduced into the $14 billion global wound care market include XTRASORB® for better management of wound exudates, and BIOGUARD® for infection prevention. Derma Sciences expects to complete the efficacy portion of its Phase II clinical study with DSC127, a novel pharmaceutical for accelerated wound healing and scar reduction, by the end of 2010.

For more information please visit www.dermasciences.com.

Forward-Looking Statements

Statements contained in this news release that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the generality of the foregoing, words such as "may," "will," "expect," "believe," "anticipate," "intend," "could," "estimate" or "continue" are intended to identify forward-looking statements. Readers are cautioned that certain important factors may affect the Company's actual results and could cause such results to differ materially from any forward-looking statements that may be made in this news release or that are otherwise made by or on behalf of the Company. Factors that may affect the Company's results include, but are not limited to, product demand, market acceptance, impact of competitive products and prices, product development, completion of an acquisition, commercialization or technological difficulties, the success or failure of negotiations and trade, legal, social and economic risks. Additional factors that could cause or contribute to differences between the Company's actual results and forward-looking statements include but are not limited to, those discussed in the Company's fillings with the U.S. Securities and Exchange Commission.