CytoSorbents Clarifies Q3 2012 Earnings Press Release

            CytoSorbents Clarifies Q3 2012 Earnings Press Release

PR Newswire

MONMOUTH JUNCTION, N.J., Nov. 26, 2012

MONMOUTH JUNCTION, N.J., Nov. 26, 2012 /PRNewswire/ -- CytoSorbents
Corporation (OTCBB:CTSO), a critical care-focused company using blood
purification to reduce inflammation as a means to prevent or treat organ
failure caused by life-threatening illnesses, issued a clarification to its
corporate update and third quarter earnings press release issued November 21,
2012.

Dr. Phillip Chan, Chief Executive Officer, stated, "Based upon numerous
shareholder inquiries, there appears to be some misinterpretation concerning
our cost of revenue for Q3 2012, our grant income, and our guidance on interim
Q4 2012 CytoSorb® sales."

"As reported in our income statement for Q3 2012, our overall cost of revenue
includes both 1) cost of goods associated with the sale of CytoSorb® and 2)
cost of grant income as well. Our CytoSorb® gross margins for Q3 2012 were in
excess of 50% and our expected CytoSorb® gross margins in Q4 2012 are also
expected to exceed 50%."

Dr. Chan continued, "It is critical for shareholders to understand the
importance of our $3.8 million contract with DARPA and our $1 million U.S.
Army Phase II SBIR award, the latter which has been granted and is currently
under contract negotiations. These awards, totaling approximately $5 million,
represent:

  oCritical third-party validation of our technology by leading research
    organizations of our U.S. government. This validation has already led to
    significant interest from other branches of the U.S. military, including
    the U.S. Air Force and U.S. Navy
  oA means to reduce our cash burn (due to payments for both direct and
    indirect or fixed costs related to achieving milestones under these
    contracts), while subsidizing the Company as sales of CytoSorb® begins to
    ramp. As evidence of this, our operating loss for Q3 2012 was only $601K,
    compared to $1.2 million in the year ago quarter. This is a significant
    positive for our Company and shareholders, as it potentially reduces the
    amount of money we will need to raise while simultaneously offsetting
    shareholder dilution
  oA direct funded path to generate data in the fields of sepsis, burn injury
    and trauma, that if positive, can be leveraged to help support the
    commercialization effort of CytoSorb® in Europe
  oA means to accelerate the next generation of our cutting edge blood
    purification technologies, helping us to maintain our leadership in this
    area."

"Finally," stated Dr. Chan, "to clarify my comments about Q4 2012 revenue. In
the time period between October 1, 2012 and November 21, 2012, we have
recorded approximately $70K in CytoSorb® sales. From January 1, 2012 to
November 21, 2012, we have recorded a total of $134K in CytoSorb® revenues.
That we have booked more revenue in the first 52 days of the fourth quarter
than we did in the first 9 months of 2012, is a reflection of the increased
effectiveness of our sales efforts and interest in our technologies. There is
naturally a delay between when a key opinion leader (KOL), who is frequently
the department chairman, agrees to use any new technology, to when it is being
used on a regular basis by other physicians in the department, driving
recurring and increased revenue. There is no question, however, that having
the approval of the KOL is a critical initial step in the process. This lays
the groundwork to have the hospital administration approve the purchase of the
technology, facilitates reimbursement, and provides the requisite approval for
physicians in the department to use the product. The value of having a direct
sales force is that we can now work to accelerate this process and convert
this KOL commitment into meaningful sales."

Dr. Chan concluded, "We continue to be very encouraged by the reception of
CytoSorb® in the market. We plan to have new items to report in the weeks
ahead and look forward to the shareholder report in early January to summarize
our progress and plans for the future."

About CytoSorbents, CytoSorb®, and HemoDefend

CytoSorbents Corporation is a critical care focused therapeutic device company
using blood purification to modulate the immune system and fight multi-organ
failure in life-threatening illnesses. Its purification technology is based on
biocompatible, highly porous polymer beads that can actively remove toxic
substances from blood and other bodily fluids by pore capture and surface
adsorption. In 2011, CytoSorb®, the Company's flagship product, achieved
European regulatory approval as an extracorporeal cytokine filter, allowing it
to be sold throughout the European Union (E.U.) under the CE Mark, to be used
in clinical situations where cytokines are elevated. The goal of CytoSorb® is
to modulate the immune system by reducing "cytokine storm" in critically-ill
patients that could otherwise lead to deadly inflammation, multiple organ
failure, immune dysfunction, and often death in common illnesses such as
sepsis, trauma, burn injury, acute respiratory distress syndrome, and
pancreatitis. CytoSorb® has demonstrated statistically significant reductions
in mortality in septic patients at high risk of death in early studies and is
now being sold in Germany, Austria and Switzerland for the treatment of
critical care illnesses, with availability in other E.U. countries planned in
the future, assuming adequate and timely funding, and continued positive
results from clinical studies.

HemoDefend is a development-stage blood purification technology platform for
the blood transfusion industry intended to reduce transfusion reactions and
safeguard the quality and safety of the blood supply. The HemoDefend
technology utilizes the Company's polymer bead technology to remove many
substances, such as antibodies, free hemoglobin and inflammatory mediators
that can cause potentially serious and sometimes fatal transfusion reactions.

CytoSorb® and HemoDefend are just two of a number of different polymers the
Company has designed for various medical applications, including improved
dialysis, reduction of post-surgical complications in cardiac surgery,
treatment of inflammatory and autoimmune disorders, radio-imaging contrast
removal in imaging and interventional radiology procedures, and the treatment
of rhabdomyolysis, drug overdose, and others. Additional information is
available for download on the Company's website: http://www.cytosorbents.com.

Forward-Looking Statements

This press release includes forward-looking statements intended to qualify for
the safe harbor from liability established by the Private Securities
Litigation Reform Act of 1995. Forward-looking statements in this press
release are not promises or guarantees and are subject to risks and
uncertainties that could cause our actual results to differ materially from
those anticipated. These statements are based on management's current
expectations and assumptions and are naturally subject to uncertainty and
changes in circumstances. We caution you not to place undue reliance upon any
such forward-looking statements. Actual results may differ materially from
those expressed or implied by the statements herein. CytoSorbents Corporation
and CytoSorbents, Inc believe that its primary risk factors include, but are
not limited to: obtaining government approvals including required FDA and
additional CE Mark approvals; ability to successfully develop commercial
operations; dependence on key personnel; acceptance of the Company's medical
devices in the marketplace; the outcome of pending and potential litigation;
compliance with governmental regulations; reliance on research and testing
facilities of various universities and institutions; the ability to obtain
adequate and timely financing in the future when needed; product liability
risks; limited manufacturing experience; limited marketing, sales and
distribution experience; market acceptance of the Company's products;
competition; unexpected changes in technologies and technological advances;
and other factors detailed in the Company's Form 10-K filed with the SEC on
March 30, 2012, which is available at http://www.sec.gov.

Contact:

CytoSorbents Corporation
Dr. Phillip Chan
Chief Executive Officer
(732) 329-8885 ext. *823
pchan@cytosorbents.com 

SOURCE CytoSorbents Corporation

Website: http://www.cytosorbents.com
 
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