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Arbios Systems, Inc. (ARBI.PK) has received approval from the U.S. Food and Drug Administration ("FDA") of an Investigational Device Exemption ("IDE") to begin the pivotal clinical trial for SEPETT, Arbios' extracorporeal (outside the body) liver assist device for blood purification of acutely ill patients suffering from chronic liver disease. "We are pleased to have received FDA approval to start the SEPET pivotal trial and to have fully satisfied the points addressed in the FDA's previously issued conditional approval," commented CEO and President Shawn Cain. "We were pleased with the compelling results from the SEPET feasibility trial, and we are excited to initiate the pivotal clinical phase of SEPET's development. The pivotal trial design includes adaptive measures to optimize our ability to achieve the trial's primary and secondary endpoints. We believe that the pivotal trial, if successful, should support our filing for approval of SEPET in the United States and marketing efforts in the United States and the European Union. Further, we believe that the design of this trial will enhance physician acceptance of SEPET as a much needed tool in sustaining patients through acute life threatening episodes of liver failure, a market which we believe exceeds a billion dollars annually."

Trial Design

There are three segments to the pivotal trial design. During the first segment of the trial, 5 non-randomized patients will be treated with SEPET to allow us to validate the patient selection criteria, clinical protocol, case report forms, and other trial related documents. During the second segment of the trial, we expect to enroll 116 patients in this randomized, controlled phase of the trial. This segment is targeted to achieve the co-primary endpoints, which are 1) the percentage of patients achieving improvement in hepatic encephalopathy ("HE") grade by a minimum of two grades by the end of Day 7 in the SEPET treatment group versus the standard medical care group, using a 1:1 randomization between the two groups; and 2) the 30-day transplant free survival rate in all patients (i.e. control and treatment groups) who do reach a two grade HE improvement versus all patients who do not reach a two grade HE improvement. Pending review and approval by the Data Safety Monitoring Board, the third segment would permit the size of the trial to be increased by an additional 52 patients, if the co-primary efficacy endpoints are reached or have not reached statistical significance but have shown a positive trend. If the co-primary endpoints of the trial are reached upon completion of segment two, extension of the trial into segment three may result in the achievement of statistical significance of one or more secondary endpoints of the trial relating to clinical, functional, and reimbursement advantages for SEPET-treatment over standard medical care.

Patient Inclusion/Exclusion Criteria for the Trial

To be a candidate for the pivotal trial, a patient must have chronic liver disease and be experiencing an acute episode that results in hospitalization with an HE grade of between II and IV. In addition, the patient must not be responding satisfactorily to standard medical care (e.g. fluid replacement, antibiotics, lactulose) for 20 to 26 hours prior to randomization. Patients contraindicated for a liver transplant (e.g. advanced liver cancer patients and drinking alcoholics) are excluded from the trial.

"We hope to shortly receive permission from the German regulatory authority to begin segment one of the pivotal trial at one or two clinical sites in Germany," commented Mr. Cain. "Over the next several months we will also seek IRB approvals for up to 24 clinical sites in the United States and Europe. While we currently have very limited financial resources, we hope that the FDA's approval to initiate the pivotal trial may enable us to raise the capital needed to implement our clinical and regulatory plans for SEPET."

About Arbios' SEPET Liver Assist Device

The SEPETT Liver Assist Device is a sterile, disposable cartridge containing microporous hollow fibers with proprietary permeability characteristics. When a patient's blood is passed through these fibers, blood plasma components of specific molecular weights are expressed through the micropores, thereby cleansing the blood of harmful impurities (e.g., hepatic failure toxins as well as various mediators of inflammation and inhibitors of liver regeneration). These substances would otherwise progressively accumulate in the patient's bloodstream during liver failure, causing hypotension, increasing risk of sepsis development and accelerating damage to the liver, lungs and other organs, including the brain and kidneys, and suppressing the function and regeneration of the liver. SEPETT is designed for use with standard blood dialysis systems available in hospital intensive care units.

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