Mechanisms of Wound Healing: Studies with the Bilayered Cellular Matrix, OrCel TM

1. Mechanisms of Wound Healing: Studies with the Bilayered Cellular Matrix, OrCelTM Melvin Silberklang, Ph.D. Chief Scientific Officer and Vice President, R&D Ortec International, Inc.

2. Clinical Application of OrCelTM

3. Description • OrCelTM (Bilayered Cellular Matrix) is a preformed bovine collagen sponge matrix, gel-coated on one side, in which normal human allogeneic skin cells are cultured: • dermal fibroblasts within the porous sponge • epidermal keratinocytes on the gel-coated, non-porous side of the sponge.

4. Development: from Epidermolysis Bullosa to Wound Healing • 1986: collagen sponge matrix-cultured autologous keratinocyte technology adapted to treat junctional Epidermolysis Bullosa (M. Carter, et al.) • 1989: first use of allogeneic bilayered composite cultured skin (CCS) in recessive dystrophic Epidermolysis Bullosahand surgery (M. Eisenberg & D. Llewelyn) • 1990: optimized CCS in normal volunteers • 1991: Ortec founded to commercialize CCS • 1994: FDA approval to launch 1st U.S. Clinical trial of CCS in burn surgery • 2001: FDA PMA approval for OrCelTM

5. FDA Approvals for OrCel™ • Humanitarian Use Device Exemption (HDE) for the treatment of surgical wounds and donor sites associated with mitten hand deformities in patients with Recessive Dystrophic Epidermolysis Bullosa (RDEB) • Split thickness Donor Sites in Burn Patients

6. OrCel™ Manufacturing Process Neonatal Foreskin Enzymatic Detachment of Epidermal and Dermal Layers Cryopreservation (P1) Cryopreservation (P1) Keratinocyte Cell Line Expansion Fibroblast Cell Line Expansion Cryopreservation (P3) Cryopreservation (P3/P4) Collagen Sponges Lamination with Collagen Gel Inoculation with Cells Culture 9 – 14 Days OrCel

7. Scanning EM of Collagen Sponge (cross-section)

8. Safety Testing of Donor and of Allogeneic Cells

9. P-63

10. Bcl-2

11. OrCelTM Wound Healing Rationale: Facilitated Tissue Regeneration • Clinical Rationale: • Co-Cultured Keratinocytes and Fibroblasts Supply Optimal Composition of Growth Factors/Cytokines • Cell-deposited Biomatrix Creates Optimal Scaffold for Wound Area Cell Migration and Proliferation • Product Resorbs Rapidly In Vivo (7 - 14 days)

12. Biological Profiles • OrCel™ cells are in growth phase • OrCel™ cells demonstrate high viability • OrCel™ cells are highly productive for wound-healing cytokines and growth factors • Co-cultured, compartmentalized cells produce more extracellular factors than either keratinocytes or fibroblasts alone

13. OrCelTM Cell Composition by Flow Cytometry Ungated 7.6% 92.3% Cells Fluorescence (FITC – pan-cytokeratin)

14. OrCel™ Histology

15. OrCelTM Histology (Ki67 Immunohistochemistry) Confidential

16. Immunohistochemical Screening for HLA-DR Antigen in Foreskin Tissue vs. OrCelTM 20X 10X 10X 20X

17. Cytokine Production by Fibroblasts, Keratinocytes and Co-Cultured Cells /24 hours 6000 /24 hours Fibroblast-Only OrCel™ Fibroblast-Only OrCel™ Keratinocyte-Only OrCel™ 50 Keratinocyte-Only OrCel™ 2 Co-Cultured OrCel™ Co-Cultured OrCel™ 2 4000 Rate of Secretion into Culture Medium, pg/cm 25 Rate of Secretion into Culture Medium, pg/cm 2000 0 0 GMCSF PGE2 VEGF bFGF KGF-1

18. OrCel OrCel ABCD Confidential

20. Immunodetection of VEGF in OrCel- Treated Nude Mice

21. Apligraf OrCel Comparative Histological Profiles

22. Output, OrCelTM and Apligraf 100000 OrCel Apligraf 10000 Cytokine Productivity, pg/cm2/day 1000 100 10 bFGF GM-CSF HGF KGF-1 VEGF IL-1a MMP-9 PGE-2

23. Effect of Fenestration on Cytokine Expression 1000 1000 Whole Fenes. Whole Fenes. 100 Cytokine Per Unit Area, pg/cm2/day 100 Cytokine Per Unit Area, pg/cm2/day 10 10 Day 1 Day 2 Day 1 Day 2 Day 1 Day 2 Day 1 Day 2 Day 1 Day 2 Day 1 Day 2 bFGF KGF-1 Il-1a bFGF KGF-1 Il-1a

24. Effect of Fenestration on Cytokine Expression Cytokine Production by Whole vs. Fenestrated OrCel Cytokine Production by Whole vs. Fenestrated Apligraf 10000 10000 Whole Fenes. Whole Fenes. 1000 1000 Cytokine Per Unit Area, pg/cm2/day Cytokine Per Unit Area, pg/cm2/day 100 100 10 1 10 Day 1 Day 2 Day 1 Day 2 Day 1 Day 2 Day 1 Day 2 Day 1 Day 2 Day 1 Day 2 GM-CSF MCSF VEGF GM-CSF MCSF VEGF

25. Challenges in Cryopreservation of Tissue Engineered Products • Optimization of Cryoprotectants and Freeze Cycle -- Minimizing Ice Crystal Damage to Cells and Matrix • Shipping and Storage at End-User Sites -- Storage Condition and Shelf Life • Development of Thawing Procedure -- Minimizing Ice Crystal Damage • Post-thaw Rinse-out of Cryoprotectants -- Practicality, User-Friendliness

26. Retention of Functionality after Cryopreservation Cell Count

27. Cryo-OrCel vs. OrCelTM 10000 Fresh OrCel Cryo OrCel 1000 Cytokine Productivity, pg/cm2/day 100 10 bFGF GM-CSF IL-1a KGF-1 MCSF VEGF

28. Cryo-ORCEL vs. Fresh ORCEL • Equivalent keratinocyte and fibroblast cell density • Equivalent cell viability • Equivalent or better metabolic activity • Essentially equivalent cytokine expression

29. DONOR SITES OrCel Standard of Care 22 Days Days to 100% Healing (Median)  15 Days • PMA Claims • Accelerated healing • Less Scarring • Reduced time to recropping Pivotal: 2/01 Based on Photography

30. Cryo-OrCelTM Preliminary Results Venous Leg Ulcers % Percentage of Patients Achieving 100% Wound Closure • Cry0-OrCel • Standard of Care Weeks Pilot: 8/00

31. Diabetic Foot Ulcers OrCel ™ Heals Wounds Faster % of Patients Achieving 100% Wound Closure By 12 Weeks  Ortec Standard ofCare Ortec Standard Of Care

32. ACKNOWLEDGEMENTS Lee McDonald Avi Lasdun Sandy Lerman Stephanie Knight Dan Dwyer Sunny Luke Rachel Tewari Tina Huang Nameeta Chimanji Lara Silberklang Melissa Steiner Flora Elequin Celina Choi Caroline Tang Steven Peltier Liza Moore Kathy Tygum Nitya Ray Hsin-Chien Tai Alla Laufer Ying Song