Media Release
13 September 2004

Bone Medical Reports Positive Phase I/IIa Clinical Trial on Oral Osteoporosis Drug

Biopharmaceutical development company Bone Medical Limited (ASX:BNE) is pleased to announce the positive completion of the first human clinical testing of its oral calcitonin osteoporosis drug, BN002.

Results from the Phase I/IIa study show that BN002 is being delivered orally and is biologically active, i.e. BN002 showed statistically significant reductions in the breakdown of bone as measured by specific markers of bone destruction in the blood. These data add to the positive safety and tolerability data previously announced.

The clinical trial results represent a major step forward for Bone Medical in the development of the osteoporosis product.

Bone Medical CEO Dr Jim Phillips said the company would now proceed to full Phase II human clinical tests where issues such as dosage and formulation optimisation will be investigated in addition to efficacy measures.

“We are now in a position to take BN002 formally into the secondary stages of clinical testing, which is a very important milestone for our company and our shareholders,” said Dr Phillips. “There are currently no oral versions of calcitonin available on the market and our goal of advancing this therapy from its current nasal and injectable versions has taken another significant step forward.

“We are very excited about the developments to date but we understand we have some
hard work ahead,” said Dr Phillips.

“These latest results confirm important progress towards our dual aims of successfully developing BN002 and making a significant impact in the battle to treat osteoporosis as the incidence of the disease grows at alarming rates. In addition these data augur well for our parathyroid hormone project which uses the same Axcess oral delivery technology”.

BN002 oral calcitonin is Bone’s lead product and is designed to treat the substantial and growing number of people suffering globally from osteoporosis (currently US$8.9 billion annual drug expenditure per annum globally).

Calcitonin is a natural hormone that has been used for more than 25 years to treat osteoporosis. It is administered by injection or, more recently, by nasal delivery. Currently total global sales of calcitonin products are approximately A$1 billion per annum.

Bone Medical successfully listed on the Australian Stock Exchange on 3 September 2004 after a reverse takeover of Revenir Limited.

About Bone Medical Limited

Bone Medical Limited is an international biopharmaceutical development company positioned to exploit the growing market in the treatment of bone disease particularly in osteoporosis and arthritis. Bone has a portfolio of biopharmaceutical development projects for the treatment of bone disease including, oral calcitonin BN002, oral
parathyroid hormone BN003, TNF regulators BN006, bone cell regulators BN005/BN008 and joint protection & collagen tolerance programme BN007.

Bone has been granted exclusive licenses from three owned subsidiaries of its controlling shareholder, Proxima Concepts Limited, for the intellectual property of those companies in the field of musculoskeletal therapies.

For more information about Bone Medical Limited, please contact:

Or visit:
www.bone-ltd.com.