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For information contact:
Joni Morford, Communicore
714/721-8081
jmorford@communicore.com


ORQUEST COMPLETES $15 MILLION MEZZANINE FINANCING


FOR IMMEDIATE RELEASE.....Mountain View, Calif.....August 12, 1997.....Orquest, Inc., a 
privately held orthobiologics company, today announced the completion of a mezzanine 
financing for $15 million.

"We have surpassed our goal for this financing and are very pleased by the strong vote of 
confidence from both current and new investors," said Michael Sumner Estes, Ph.D., 
president and chief executive officer.  This financing will be used to expand clinical evaluation 
of Orquest's Healosª product, a bone grafting material for spinal fusion, to commence clinical 
trials for Ossigelª, an injectable product for accelerating the healing of fractures, and to 
continue development of tissue regeneration materials for bone and cartilage.

Primary investors in this round are:  Asset Management Associates, Charter Ventures, 
Mayfield Fund, Nikko Capital, Nippon Investment & Finance Company, Pacific Horizon 
Partners, Sprout Group, State of Michigan Retirement Systems, and Weiss, Peck & Greer.

Healos was designed to replace autograft bone harvesting--a painful and expensive secondary 
surgery routinely performed to facilitate fusion of unstable spinal vertebrae.  Similar to 
autograft bone, Healos is completely replaced by new bone as part of the natural healing 
process.  Healos is currently in clinical trials for spinal fusion in Europe, U.S. clinical trials
are expected to begin in 1998.  Additionally, through a strategic alliance with SpineTech, Healos 
will be evaluated with the BAKª line of interbody fusion cages for spinal fusion.  An estimated 
200,000 spinal fusion procedures are performed each year in the U.S. to treat chronic back 
pain and other spinal disorders. 

Orquest's second technology, Ossigel, was designed to accelerate fracture healing.  Delivered 
by a single administration into the site of a fresh (new) fracture, the Company believes Ossigel 
promotes healing through the development of an enhanced callus, an important event in the 
early stages of fracture healing and repair.  Orquest is completing preclinical evaluation for 
Ossigel and expects to file an Investigational Device Exemption (IDE) this year to initiate 
clinical trials in the U.S.  Approximately 6 million people suffer bone fractures in the U.S. 
annually.  Orquest believes a significant portion of these patients may experience a faster 
return to normal activities from treatment with Ossigel.  
 
Orquest, Inc., a private orthobiologics company headquartered in Mountain View, California, 
was founded in 1994 to develop a portfolio of innovative and cost-effective products for bone 
and cartilage regeneration.  Orquest's biomaterials harness the body's own natural capacity to 
regenerate and repair.  Tailored to specific clinical indications, Orquest's products target the 
major growth segments in orthopedics: spine and trauma/sports medicine.  Orquest's 
technologies have the potential to improve clinical outcomes and shorten recovery time, 
resulting in enhanced patient quality of life and reduced healthcare costs.


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