EANS-Adhoc: Oxygen Biotherapeutics Reports Financial Results For Third Quarter FY2011

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9-month report/Biotechnology

22.03.2011

MORRISVILLE, NC, March 21, 2011 — Oxygen Biotherapeutics, Inc.
(NASDAQ and SIX Swiss Exchange: OXBT), a development stage biomedical
company focused on developing oxygen-rich intravenous and topical
products, today announced results for the fiscal year (FY) third
quarter ended January 31, 2011.

Highlights (activity through March 18, 2011)

•Received $2.07 million two-year grant from the U.S. Army to study
the use of the company´s Oxycyte® perfluorocarbon (PFC) emulsion for
traumatic brain injury. •Signed research contract with Hackensack
University Medical Center to study the wound healing properties of
the company´s Wundecyte™ gel. These studies are funded by the U.S.
Department of Defense. •Signed agreement to sell DERMACYTE® skin care
products to Swiss company that will target the Swiss, European Union
and Russian markets. Company ordered additional 10,000 units in
March. •Signed agreement to sell DERMACYTE skin care products to
Mexican company that will target the Mexican market. •Signed a Letter
of Intent with Sarasota Medical Products to pursue joint research and
development in chronic ischemic wound care.

"Finding solutions for oxygen deprived tissues continues to be a high
priority of the U.S. military and we are pleased to be a part of the
process to develop new and better treatments for our injured
soldiers," said Chris Stern, Chairman & Chief Executive Officer of
Oxygen Biotherapeutics. "It is our hope that TBI studies conducted
with the Army grant will help us develop the safety profile of
Oxycyte PFC and address questions raised by U.S. regulatory
authorities. Likewise, we believe the wound studies with HUMC, also
funded by the DoD, will provide valuable data necessary to move our
topical PFC formulation for wound care forward."

Regarding the DERMACYTE business, Stern said: "During this quarter we
set the stage for international sales of DERMACYTE products by
entering into an agreement with DERMACYTE Switzerland Ltd. (DSL).
They are meeting their contractual obligations by ordering 10,000
units of DERMACYTE this month. Our agreement with DSL sparked
interest from Mexico, resulting in a similar agreement with Comercial
Uni2 this month. Our goal is to enter into additional distribution
agreements while we develop our domestic sales force now focused on
medical practices in South Florida, Southern California and North
Carolina."

Third Quarter Results

Oxygen Biotherapeutics reported net revenue of $26,589 for the third
quarter of fiscal 2011, compared to $12,165 for the comparable
quarter the previous year due primarily to sales of DERMACYTE
products to DSL. Gross margin was 51% as compared to 40% for the
three months ended January 31, 2011 and 2010 respectively.

Net revenue for the nine months ended January 31, 2011 was $58,825
compared to net revenue of $18,726 for the same period in fiscal year
2010. This was primarily due to the addition of two new DERMACYTE
products and direct-to-consumer sales. Gross margin as a percent of
revenue was 62% compared with 50% for the comparable nine-month
period year over year.

For the third-quarter ended January 31, 2011, we reported a net loss
of approximately $2,544,187 million, or $0.11 per share, compared to
a net loss of approximately $2,753,712 million, or $0.13 per share
for the same period in the prior year. We reported a net loss of
approximately $7,598,423 million, or $0.33 per share for the nine
month period ended January 31, 2011, compared to a net loss of
$7,739,602 million, or $0.41 per share for the same period in fiscal
year 2010.

Total operating expenses for the quarter ended January 31, 2011 were
$2,781,344 compared to $2,764,776 for the same period in 2010. For
the nine-month period ended January 31, 2011 the company had total
operating expenses of $7,893,518 compared to $7,648,362 for the same
period last year. The increase in operating expenses for the
three-months ended January 31, 2011 was due to increases of
approximately $200,000 and $325,000 in sales and marketing costs and
general and administrative costs, respectively, partially offset by a
decrease in research and development costs of approximately $510,000.
The increase in operating expenses for the nine-months ended January
31, 2011 was due to increases of approximately $415,000 and $47,000
in sales and marketing costs and research and development costs,
respectively, partially offset by a decrease in general and
administrative costs of approximately $215,000.

The increases in marketing and sales expenses for the three- and
nine-months ended January 31, 2011 were driven primarily by an
increase in the costs incurred for compensation and direct
advertising.

The increase in general and administrative expenses for the three
months ended January 31, 2011 was driven primarily by a reduction in
costs incurred for banking and investor relations, travel related
costs, compensation and consulting fees, offset by accruals for
contingent liabilities associated with potential 409A tax
liabilities. The decrease in general and administrative expenses for
the nine months ended January 31, 2011 was driven primarily by a
reduction in costs incurred for stock-based compensation and
consulting fees; partially offset by an increase in depreciation and
amortization, rent, compensation and accruals for contingent
liabilities associated with potential 409A tax liabilities.

The decrease in research and development expenses for the
three-months ended January 31, 2011 was driven primarily by a
reduction in the costs incurred for the development of Oxycyte and
DERMACYTE, consulting costs, and preclinical study costs partially
offset by an increase in costs incurred in connection with the Phase
II-b clinical trials and compensation. The slight increase in
research and development expenses for the nine-months ended January
31, 2011 was driven primarily by costs incurred for compensation and
the costs associated with the Phase II-b clinical trials for Oxycyte,
offset by a reduction in the costs incurred for the development of
Oxycyte and DERMACYTE, consulting costs, and preclinical research
costs.

During the nine-month period ending January 31, 2011, as compared to
the same period in 2010, total other income increased approximately
$240,000 primarily due to an award of $244,489 under the Patient
Protection and Affordable Care Act of 2010 received in November 2010.

For the nine-month period ended January 31, 2011, the Company had
cash and cash equivalents totaling $522,340, down from $632,706 at
April 30, 2010.

Conference Call

Management will host a conference call on Tuesday, March 22, 2011 at
11 a.m. EDT. To access the live teleconference, dial (866) 578-5784
(U.S. and Canada) or (617) 213-8056 (international.) The participant
pass code is 93886225. A live webcast will be available on our web
site http://www.oxybiomed.com/investors.htm. A replay of the webcast
will be available on the Oxygen Biotherapeutics website or by phone
for a limited time. To access the replay by phone, call (888)
286-8010 (U.S. and Canada) or (617) 801-6888 (international) for a
limited time. The pass code for the replay is 38473378.

Caution Regarding Forward-Looking Statements

This news release contains certain forward-looking statements by the
company that involve risks and uncertainties and reflect the
company's judgment as of the date of this release. These statements
include the expansion of development of the Oxycyte and DERMACYTE
product lines and the timing of the introduction of those new
products. The forward-looking statements are subject to a number of
risks and uncertainties including matters beyond the company's
control that could lead to delays in new product introductions and
customer acceptance of these new products, and other risks and
uncertainties as described in our filings with the Securities and
Exchange Commission, including in the current reports on Form 10-Q
and Form-10K. The company disclaims any intent or obligation to
update these forward-looking statements beyond the date of this
release. This caution is made under the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995.

end of ad-hoc-announcement ==========================================
====================================== About Oxygen Biotherapeutics,
Inc.

Headquartered in Morrisvile, NC, Oxygen Biotherapeutics, Inc. is
developing medical and cosmetic products that efficiently deliver
oxygen to tissues in the body. The company has developed a
proprietary perfluorocarbon (PFC) therapeutic oxygen carrier called
Oxycyte that is being formulated for both intravenous and topical
delivery. Potential indications include traumatic brain injury,
decompression sickness, wounds and dermatologic indications. This
year, the company launched its DERMACYTE® line of oxygen-rich skin
care products. More information is available at www.oxybiomed.com or
www.dermacyteUS.com.

end of announcement euro adhoc
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ots Originaltext: Oxygen Biotherapeutics Inc.
Im Internet recherchierbar: http://www.presseportal.de

Further inquiry note:

Ellen Corliss
Vice President, Corporate Communications
& Investor Relations
Oxygen Biotherapeutics, Inc
2530 Meridian Pkwy, 3rd floor
Durham, NC 27713
Direct Telephone: +1 919 855 2112
Direct Fax: +1 919 806 4417
Email: e.corliss@oxybiomed.com

Branche: Biotechnology
ISIN: US69207P2092
WKN: 10728277
Index: SSIRT
Börsen: New York / Nasdaq
SIX Swiss Exchange / Main Standard