Novadaq Technologies Inc.

Novadaq Technologies Inc.

March 21, 2007 09:34 ET

Novadaq Acquires Edwards Lifesciences' Exclusive Distribution Rights for PLC'S Heart Laser System for TMR

TORONTO, ONTARIO--(Marketwire - Mar. 21, 2007) -

Attention Business Editors:

Novadaq® Technologies Inc. (TSX:NDQ), a developer of real-time medical
imaging systems and image guided therapies for the operating room, announced
today that its wholly-owned U.S. subsidiary, Novadaq Corp., has agreed with
Edwards Lifesciences LLC to acquire Edwards' exclusive distribution rights to
PLC Medical System Inc.'s HEART LASER™ SYSTEM for transmyocardial
revascularization (TMR) in the United States. Novadaq will begin marketing the
system immediately.

TMR is a procedure aimed at improving blood flow to areas of the heart in
patients suffering from stable Class III or IV angina or chest pain due to a
decrease in blood supply to the heart muscle and that can not be successfully
treated by other revascularization procedures, such as angioplasty, stents or
coronary artery bypass surgery (CABG). TMR involves the use of a laser to
create small channels in the heart muscle which may promote the growth of
small blood vessels that will help supply blood to the heart muscle, a process
know as angiogenesis. TMR procedures are FDA approved for treating areas of
the myocardium not amenable to traditional methods of revascularization. The
procedure is reimbursed by the Center for Medicare and Medicaid Services using
specifically designated codes.

Studies published in such journals as the New England Journal of Medicine
and Circulation report a sustained benefit to patients treated with TMR
compared to patients treated with other therapies. Novadaq understands from
experts in the field of cardiac surgery that more than 30,000 patients in the
US could benefit from TMR each year; however, today, only 7,000 patients are
actually treated. Novadaq's SPY® Intra-operative Imaging System may enable
cardiac surgeons to visually identify the most suitable area for treatment by
assessing blood flow which is indicative of tissue perfusion and potentially
guide TMR delivery in real-time making the procedure potentially more
effective and offered more frequently to patients in need.

"Based upon Edwards' historical revenues and margins for its distribution
of TMR, this transaction will be immediately accretive to our bottom line and
synergistic to our sales strategy as we can now offer cardiac surgeons a total
revascularization solution", said Dr. Arun Menawat, President and Chief
Executive Officer of Novadaq Technologies Inc. "The combination of our SPY
System and TMR not only holds the promise of improving the effective delivery
of TMR, but will also potentially improve the quality of life for many
patients. TMR fits well with our current corporate strategy to provide and
enable image guided therapies in the operating room and further validates our
vision that real-time image guidance in the operating room can improve the
effectiveness of therapeutic surgical procedures."

"Novadaq's strong commitment to quality products and customer education
will ensure that our cardiac surgeon customers will continue to receive the
high level of service and support they have come to expect," said Rick Bleil,
Vice President, General Manager, Cardiac Surgery Systems, Edwards

"Today, we are taking a major step for our TMR business by naming a new
partner in Novadaq," said Mark R. Tauscher, President and Chief Executive
Officer of PLC Systems, Inc. "We, and Novadaq, see strong synergistic
opportunities for our TMR product line used in real-time in conjunction with
Novadaq's SPY- Intra-operative Imaging System, for which Novadaq recently
built a direct US sales team that targets the same end user as we do, the
cardiac surgeon. We appreciate the support of Edwards throughout the launch
and building of our TMR business, and we are fortunate to find a new and able
partner in Novadaq to make this a seamless transition for our growing customer

For the exclusive United States distribution rights, Novadaq will pay
Edwards cash consideration in the amount of $1 million USD at closing, an
earn-out for the balance of 2007 which is estimated to be $3 million USD and a
final payment of $3 million USD which is deferred under a one-year secured
promissory note. Novadaq will also purchase Edwards' inventory and certain
property used in its distribution of TMR at Edwards' net book value. In 2006,
revenues for Edwards' TMR product line were approximately $12 million USD at
gross margin of approximately 50%.

Edwards has committed to assist in transitioning the TMR distribution to
Novadaq. Concurrently with the Edwards transaction, Novadaq is entering into
an amended and restated distribution agreement with PLC.

Conference Call

Management will also host a conference call and live webcast this
afternoon, Wednesday, March 21, 2007 at 4:15 p.m. E.T. to discuss the
acquisition of Edwards' TMR distribution rights. To access the conference call
by telephone, dial 416-644-3420 or 1-800-595-8550. Please connect
approximately ten minutes prior to the beginning of the call to ensure
participation. The conference call will be archived for replay until March 26,
2007 at midnight. To access the archived conference call, dial 416-640-1917 or
1-877-289-8525 and enter the reservation number 21224262 followed by the
number sign. A live audio webcast of the conference call will be available at Please connect at least ten minutes prior to the conference
call to ensure adequate time for any software download that may be required to
join the webcast. The webcast will be archived at the above website for 365

About Novadaq Technologies

Novadaq Technologies Inc. (TSX:NDQ) develops and commercializes medical
imaging systems and real-time image guided therapies for use in the operating
room. Novadaq's proprietary imaging platform can be used to visualize blood
vessels, nerves and the lymphatic system during surgical procedures. Novadaq's
SPY® Intra-operative Imaging System, commercially available worldwide,
enables cardiac surgeons to visually assess coronary vasculature and bypass
graft functionality during the course of open-heart surgery. Novadaq's
OPTTX ® System which received CE Mark approval in November 2006, is aimed at
the diagnosis, evaluation and treatment of wet Age-related Macular
Degeneration (AMD) by using the same core imaging technology that is used in
the SPY System. The HELIOS™ System, which received FDA clearance in January
2007, is the first fluorescent imaging system available for use during plastic
reconstructive surgery allowing surgeons to evaluate pre- and intra-operative
blood flow, as well as post-surgery perfusion. Novadaq's LUNA™ system is
designed to enable surgeons to visualize nerve bundles during the course of
urological and neurological procedures. LUNA has been granted a license for
use by Health Canada. For more information, please visit the company's website

Certain statements included in this press release may be considered
forward-looking. Such statements involve known and unknown risks,
uncertainties and other factors that may cause actual results, performance or
achievements to be materially different from those implied by such statements,
and therefore these statements should not be read as guarantees of future
performance or results. All forward-looking statements are based on Novadaq's
current beliefs as well as assumptions made by and information currently
available to Novadaq and relate to, among other things, anticipated financial
performance, business prospects, strategies, regulatory developments, market
acceptance and future commitments. Readers are cautioned not to place undue
reliance on these forward-looking statements, which speak only as of the date
of this press release. Due to risks and uncertainties, including the risks and
uncertainties identified by Novadaq in its public securities filings; actual
events may differ materially from current expectations. Novadaq disclaims any
intention or obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise.

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