Operational highlights

Building and commissioning of a manufacturing facility

Commencement of plasma fractionation for lead product candidate, an all-human fibrin sealant

Positive pre-clinical results in new potential indications for fibrin sealant in adhesion prevention and skin graft fixation

Addition of new board members and strengthening of team

The most significant achievement of fiscal 2008 was the commencement of plasma fractionation at Haemacure’s facility. Also of major significance were the positive results of preclinical studies conducted on the efficacy of Haemacure’s proprietary all-human fibrin sealant in the prevention of the formation of post-surgical adhesions and in skin graft fixation for burn injuries. These preclinical studies are the first step towards the development of an expanded portfolio of indications for Haemacure’s fibrin sealant based on its existing general hemostasis formulation. The year was also marked by significant additions to competencies as Haemacure was successful in recruiting Mr. Reinaldo M. Diaz and Dr. Thomas J. Lynch as new directors, as well as strengthening the management, operations and scientific teams.

“2008 was a year of major accomplishments as we started processing plasma in our facility to meet our clinical trials timeline”, said Joseph Galli, chairman and chief executive officer of Haemacure. “I am excited about the prospects for 2009 as we enter the clinic and continue to execute on our plan with a view to becoming a global player offering a next generation, all-human fibrin sealant”, concluded Galli.

Manufacturing Facility

Haemacure is processing plasma at its state-of-the-art manufacturing facility located in Sarasota, Florida in preparation for the pivotal phase II/III clinical trials for its lead product candidate, a proprietary human fibrin sealant, which it plans on commencing mid-2009 under its IND currently open with the US FDA. The commercial launch of the fibrin sealant remains planned by mid-2011. Haemacure’s facility is the only U.S.-based fibrin sealant manufacturing facility for the US market, which is of significant strategic value.

Financial Results

Revenues consisted exclusively of legacy devices sales. Operating expenses totalled $8.9 million, up from $4.0 million the prior year. The increase is mainly attributable to the construction and validation of the manufacturing facility, hiring of personnel and consulting and professional services.

Haemacure is financing its current activities with the proceeds of the $7.8 million generated through the exercise in June 2008 of warrants issued as part of the private placement it completed in January 2007, and will require additional financing in the near term to support its operations.