Raymedica Regains Distribution Rights for the PDN(R) Prosthetic Disc Nucleus Device
New Distribution Network to Be Established in Europe and India

MINNEAPOLIS, Feb. 23 -- Raymedica, Inc., an orthopedic medical technology innovator and device manufacturer of non-fusion spinal implants for the treatment of back pain, announced today that Medtronic, Inc. will return the European and Indian distribution rights of the PDN -SOLO(R) Prosthetic Disc Nucleus to Raymedica. A new distribution network will be established to actively market the PDN-SOLO device during the second quarter of 2005.

"We are grateful for Medtronic's efforts in distributing the PDN during this evaluation stage," said John J. Viscogliosi, Chief Executive Officer and Chairman of the Board of Directors for Raymedica. "This change in distribution management will, however, allow Raymedica to take a stronger, more active and direct role in the distribution of its technology and products and in the education and training of surgeons who will implant the PDN device. This transition also will allow us to have greater control over the collection of clinical data on European patients and to generate significantly greater retrospective and prospective data.

Raymedica's goal during this transition is to work closely with Medtronic to ensure continued support to all previously implanted patients and service to the surgeons and hospitals involved in providing the PDN device."

The PDN device is comprised of a hydrogel material contained within a woven polyethelene jacket. The device is designed to replace the form and function of an otherwise failed spinal disc nucleus. To treat low-back pain, a PDN device is implanted in the center of the spinal disc. The device is designed to further support the annulus tissue and vertebrae bones of a patient's spine while allowing for more flexibility and movement than spinal fusion, the current established surgical treatment, in which adjacent vertebrae of the spine are fused together.

The PDN-SOLO device is commercially available in Europe and other international markets, but is not yet approved for commercial distribution in the United States. More than 3,300 patients worldwide have received a PDN implant. Raymedica is pursuing marketing approval from the U.S. Food and Drug Administration.

About Raymedica, Inc.
Raymedica, privately held and based in Minneapolis, developed the PDN prosthetic disc nucleus for the surgical treatment of low-back pain that does not respond to conservative care. Back pain is the second most common reason patients seek medical care in the United States, with more than 1.5 million people requiring surgical treatment annually.