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EATONTOWN, N.J., Nov. 7 /PRNewswire-FirstCall/ -- Osteotech, Inc. (Nasdaq: OSTE), a leader in the emerging field of biologic products for regenerative healing, announced today that its next generation grafting material will be marketed under the brand name, MagniFuse(TM) Bone Graft.

Robert M. Wynalek, Osteotech's President - Domestic, commented, "The MagniFuse(TM) line of next generation bone regeneration products was developed in response to surgeon interest in a high performing, cost effective bone graft material. We believe that the distinctive properties of MagniFuse(TM) will redefine the bone grafting market and allow Osteotech to go head-to-head with bone morphogenetic protein products within the marketplace. This market is primed for a product that provides powerful bone formation and fewer complications, all at a cost effective price. We expect MagniFuse(TM) to be available for customers in the middle of 2009."

MagniFuse(TM) is a unique combination of allograft bone within a polymer mesh that will provide targeted and contained delivery. The polymer mesh is made from a biodegradable suture material and is designed for effective cellular in-growth and complete resorption within three to six months, while not interfering with bone regeneration. The polymer mesh provides a controlled environment for proximate allograft interaction eliminating issues with graft site migration or irrigation that is often seen with currently available bone graft substitutes. As previously announced, Osteotech has received 510(k) clearance from the United States Food and Drug Administration for MagniFuse(TM) as a bone graft substitute, and as a bone void filler, for use in the spine, pelvis and extremities.

The MagniFuse(TM) line of bone grafting solutions will provide a wide range of market opportunities with tissue products specifically designed for use in the Posterolateral Spine, Deformity and Minimally Invasive Procedures. MagniFuse(TM) will compete in the bone graft substitute market, which is estimated to be in excess of $1.2 billion in the United States.

"The pre-clinical animal data for MagniFuse(TM) supports its use as a stand alone product in the Posterolateral Spine," remarked Mohammed Attawia, MD, MS, Osteotech's Vice President of Product Development. "Further pre-clinical work is ongoing and will be available for product launch. Our work to date indicated that the architecture of MagniFuse(TM) delivers performance beyond that of current bone grafting materials. We believe this breakthrough will allow us to redefine the standard of care for bone regeneration."

Larry Shimp, Ph.D., Osteotech's Principal Technology Officer, stated, "We believe the enhanced properties of MagniFuse(TM) go beyond that of many other products currently in the marketplace. We have developed a new, proprietary process that is designed to preserve a higher concentration of naturally occurring growth factors already present in human bone, while preserving the natural orientation and nanofibrous structure of the bone. The process of recovering a higher growth factor content from allograft bone is the subject of an outstanding patent application, and the technology that preserves the nanofibrous structure is covered by a patent and a pending patent application."

Osteotech also has a patent pending technology that controls the remodeling properties of the allograft bone used in MagniFuse(TM). MagniFuse(TM) is designed to be radiopaque allowing the surgeon to identify the bone graft in post operative x-rays, which is the subject of another one of Osteotech's patents. Overall, the MagniFuse(TM) technology is supported by seven total patents and patent applications.

Osteotech, Inc., headquartered in Eatontown, New Jersey, is a global leader in providing OsteoBiologic solutions for regenerative medicine to support surgeons and their patients in the repair of the musculoskeletal system through the development of innovative therapy-driven products that alleviate pain, promote biologic healing and restore function. For further information regarding Osteotech or this press release, please go to Osteotech's website at http://www.osteotech.com.

Certain statements made throughout this press release that are not historical facts contain forward-looking statements (as such are defined in the Private Securities Litigation Reform Act of 1995) regarding the Company's future plans, objectives and expected performance. Any such forward-looking statements are based on assumptions that the Company believes are reasonable, but are subject to a wide range of risks and uncertainties and, therefore, there can be no assurance that actual results may not differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to, the Company's ability to develop and introduce new products, differences in anticipated and actual product and service introduction dates, the ultimate success of those products in the marketplace, the continued acceptance and growth of current products and services, the impact of competitive products and services, the availability of sufficient quantities of suitable donated tissue and the success of cost control and margin improvement efforts. Certain of these factors are detailed from time to time in the Company's periodic reports filed with the Securities and Exchange Commission. All information in this press release is as of November 7, 2008 and the Company does not intend to update this information.