“Reductions in comparative revenue between fiscal year 2002 and fiscal year 2001 relate to the Company’s planned conversion from ‘capital sales’ of the HDI/PulseWave™ CR-2000 Research System to ‘per-use’ rentals of our CVProfilor^® DO-2020 System. During our Phase I launch of the CVProfilor^® DO-2020 System in the first three quarters of fiscal year 2002, nearly all Company resources were focused on preparing for and executing our marketing plan. During this period of time, our objective was to validate key marketing and sales assumptions prior to broadening our distribution,” said Greg H. Guettler, President of HDI.

“Following completion of our Phase I launch of the CVProfilor® DO-2020 System, we re-established an emphasis on both domestic and international sales opportunities. As a result of these efforts, we have had a number of fiscal year 2002 accomplishments that position us for improved long-term success:

• Domestic Placements: We had 107 CVProfilor^® DO-2020 System U.S. placements in 23 States as of June 30, 2002.

• Domestic Reimbursement: Most physicians using the CVProfilor^® DO-2020 System are obtaining reimbursement under existing CPT codes. Of the 23 States where we have placements, doctors in 11 states have confirmed reimbursement. The level of physician reimbursement varies by provider, by patient and by clinic.

• Domestic Distribution: We established a base of independent representatives throughout the U.S. to identify and qualify CVProfilor^® DO-2020 physician leads for our direct sales force.

• Patient Screening: We established a consumer-direct presence through our relationships with four consumer screening firms that allow access to a CVProfile™ allowing for early assessment of cardiovascular disease. We also established a test-market with Costco Wholesale Corporation, which could potentially provide tests for their millions of consumer members.
  Research Sales: We sold additional HDI/PulseWave™ CR-2000 Research Systems to the Pfizer Pharmaceuticals Group, a division of Pfizer, Inc., for inclusion in a multi-center cardiovascular drug research trial.

• Research Validation: During the fiscal year ended June 30, 2002, more than 35 scientific articles were published referring to our technology and/or methodology. These additional articles currently comprise a bibliography of 156 referenced publications.
  Pharmaceutical: Novartis Pharmaceuticals Corporation contracted with us to test more than 500 visitors at its booth at the American College of Cardiology meeting.
  International: We introduced our CE Marked CVProfilor^® MD-3000 Physician System to the international market at the International Society of Hypertension and European Society of Hypertension meetings in Prague, Czech Republic.

• International Distributors: We added exclusive distributors of our products in India (a nation of 1 billion people), in Korea (a nation of 47 million people), and in Greece (a nation of nearly 11 million people) bringing our total international network to 13 distributors covering 16 countries. We now have our products placed in 24 countries worldwide.

• Working Capital: We secured an additional $2,000,000 in working capital raised through a private placement of 8% Convertible Notes to assist in the implementation of our current business development plan.”

“Despite these accomplishments and the soundness of our cardiovascular profiling technology, Company growth has been admittedly slower than we anticipated. We believe that this has been in part due to a variety of factors including an uncertain economic climate that has tended to slow the adoption of new technologies, a scarcity of investment capital with which to support a more aggressive implementation of our business plan, a declining stock market that has been particularly hard on small medical device companies such as ours, a longer period of time for our physician customers to obtain confirmation of reimbursement from third party payers, and the intensity of human resources required to establish consistent physician utilization of our products. These are real-world issues not unusual for a medical device start-up company; regardless, we continue to see significant opportunities to grow the business,” added Guettler.

The Company expects that its current funds, in conjunction with revenue anticipated to be earned from placements of CVProfilor^® DO-2020 Systems, anticipated sales of CR-2000 Research Systems and CVProfilor^® MD-3000 Systems, as well as anticipated operating cost reductions, are estimated to allow the Company to pursue its current business development strategy for approximately the next six months. The Company is seeking additional financing for working capital and is considering all possible financing alternatives.

View/download FY 2002 Results in .pdf format

Forward-looking statements in this press release are made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The Company wishes to caution readers not to place undue reliance on any forward-looking statements and to recognize that the statements are not a prediction of actual future results. Actual results could differ materially from those presented and anticipated in the forward-looking statements due to the risks and uncertainties set forth in the Company’s 2001 Annual Report on Form 10-KSB, under the caption “Risk Factors,” as well as others not now anticipated.

CVProfilor is a registered trademark of Hypertension Diagnostics, Inc.
  
Hypertension Diagnostics, HDI/PulseWave, PulseWave and CVProfile are trademarks of Hypertension Diagnostics, Inc. All rights reserved.

Contact: Greg H. Guettler, President