FOR IMMEDIATE RELEASE Contact: Stacy Seiders
Isolyser Company, Inc.
(770) 806-9898
Donna J. Gaidamak
Allegiance Corporation
(847) 578-4434
ISOLYSER ANNOUNCES COMPLETION OF ITS SALE
OF MEDSURG INDUSTRIES AND LICENSE OF
OREX TECHNOLOGY TO ALLEGIANCE
NORCROSS, Georgia, July 13, 1999 - Isolyser Company, Inc. (Nasdaq:
OREX) today announced the completion of the sale of the assets of its MedSurg
Industries, Inc. subsidiary to a unit of Allegiance Healthcare Corporation, a
subsidiary of Allegiance Corporation, and the grant to Allegiance of a worldwide
exclusive license to convert, use and sell products made with Isolyser's
proprietary degradable materials known as OREX(R) and Enviroguard(TM) for
distribution in the healthcare marketplace for a total of $31.3 million.
Under the terms of the three-year License Agreement, Isolyser will be
the sole supplier to Allegiance of dissolvable material made from PVA, the raw
material used to manufacture Isolyser's OREX(R) and Enviroguard(TM) products,
for use in the health care field. Allegiance is committed to purchase a certain
quantity of Enviroguard(TM) fabric. Also under the Agreement, Allegiance will
pay Isolyser a royalty equal to a percentage of the net sales price of product
sold by Allegiance to customers who utilize the product's unique dissolution
technology.
Migo Nalbantyan, president and chief executive officer of Isolyser,
stated, "We are very pleased with our agreement with Allegiance and are
committed to serve our health care customers with many innovative new products.
Also, as a result of our much improved financial condition, we are now better
positioned to accelerate the strategic growth of our technology into other
markets."
"Allegiance is delighted to add Isolyser's innovative OREX(R) and
Enviroguard(TM) technology to our leading line of surgical apparel and
supplies," said Mike Hudson, president of Allegiance's Convertors and Custom
Sterile businesses. "We believe there is significant potential for a line of
clinically superior single use medical products that are also environmentally
friendly. The combination of Allegiance's Sales and Marketing skills coupled
with Isolyser's Research and Development should result in increased demand for
the Enviroguard(TM) family of products. We envision this product family to
include: nonwoven drapes and apparel, textiles, injection-molded devices and
plastic type film products. Our intent is to cover a large percentage of the
disposable products used in the Operating Room, Labor and Delivery and Cath
Lab."
Both companies are finalizing a product introduction, marketing and
manufacturing schedule related to the introduction of new products. It is
expected that this process will be completed over the next several months.
Isolyser will use funds from the sale to eliminate the remaining
balance of its revolving credit facility as well as provide additional operating
funds and capital for investment in its technology.
MedSurg Industries, Inc. assembles and distributes sterile and
non-sterile procedure trays and packs for hospitals and other healthcare
institutions. Isolyser acquired MedSurg in 1993. Isolyser's OREX division, OREX
Technologies International (OTI), possesses an extensive knowledge of polyvinyl
alcohol polymer and its associated properties and specializes in the development
and commercialization of materials that are engineered with characteristics that
facilitate their disposal (bio-cycle). OTI also has a range of capabilities in
the area of point-of-use waste treatment and disposal.
Based in McGaw Park, Illinois, Allegiance Corporation
(www.allegiance.net), is America's leading provider of health care products and
cost management services needed by hospitals, laboratories and others in health
care. Allegiance is a subsidiary of Cardinal Health, Inc. (NYSE: CAH), of
Dublin, Ohio. Cardinal is a leading provider of services supporting health care.
This press release contains forward-looking statements made pursuant to
the safe harbor provisions of the Private Securities Litigation Reform Act of
1995. Such statements may be significantly affected by certain risks and
uncertainties described in the Company's annual report on Form 10-K and
elsewhere, including without limitation, the risks described in Risk Factors in
the Company's Annual Report on Form 10-K for the period ending December 31, 1998
under the captions "Risks of New Products," "Manufacturing and Supply Risks,"
"Protection of Technologies," "Competition," "Risks of Technological
Obsolescence," "Reliance Upon Distributors," "Regulatory Risks," and "Product
Liability," and risks associated with any failure of Isolyser to timely fulfill
Allegiance's purchase orders and otherwise perform Isolyser's obligations under
the license agreement. The Company's actual results could differ materially from
such forward-looking statements.
Isolyser has developed and manufactures OREX(R) Degradables, a series
of ecologically safe products made from a thermoplastic, hot water soluble
polymer that can be configured into an array of products such as woven and
nonwoven fabrics, film, thermoformed and extruded items. The Company believes
that its products provide protection to people and the environment while
providing cost-effective solutions to the problems associated with waste
reduction and disposal. The Company also manufactures infection control
products.
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