Angiotech announces results for the fourth quarter ended December 31, 2007



    VANCOUVER, Feb. 14 /CNW/ - Angiotech Pharmaceuticals, Inc. (NASDAQ:   ANPI,
TSX: ANP), a global specialty pharmaceutical and medical device company, today
announced unaudited interim and annual consolidated financial results for the
fourth quarter and year ended December 31, 2007. The unaudited financial
results are subject to further review and potential adjustment as described
under the section "Financial Information".
    "Throughout 2007, we continued to build our business with the launch of
new products, the receipt of regulatory approvals, and the establishment of
new partnerships. We expect our new product pipeline and our portfolio of
innovative currently marketed products to provide growth and opportunity in
2008 and beyond," said Dr. William Hunter, President and CEO of Angiotech.
    "With our expanded sales and marketing team in place and many of our
reorganization activities completed, we believe that we are well positioned to
achieve our targets for sales growth and gross margin improvements in the
coming year," said Tom Bailey, Chief Financial Officer of Angiotech. "We are
confident that during 2008 we will begin to realize returns on the various
investments we have made in our business over the last two years."

    Fourth Quarter Financial Highlights

    
    -   Total revenue, as adjusted for non-recurring items, was
        $70.7 million. Total revenue under generally accepted accounting
        principles (GAAP) was $71.4 million.

    -   Net product sales, as adjusted, were $43.5 million, and were derived
        primarily from sales of our various single use specialty medical
        devices as well as from sales of medical device components to third
        parties. Net product sales under GAAP were $43.9 million.

    -   Royalty revenue was $27.2 million, and included $25.4 million of
        royalty revenue derived from sales by Boston Scientific Corporation
        (BSC) of paclitaxel-eluting coronary stent systems. The average
        blended royalty rates indicated during the quarter were 7.5 percent
        for U.S. sales, and 5.7 percent for sales recorded in other
        countries.

    -   Adjusted EBITDA (earnings before interest, taxes, depreciation and
        amortization, adjusted to exclude certain non-cash and non-recurring
        items) was $6.8 million. Excluding research and development expenses,
        the significant majority of which are discretionary and relate
        primarily to our Pharmaceutical Technologies segment, adjusted EBITDA
        would be $20.2 million.

    -   GAAP net loss and net loss per share from continuing operations were
        $16.8 million and $0.20, respectively.

    -   Adjusted net loss from continuing operations and adjusted net loss
        per share from continuing operations (GAAP net loss as adjusted to
        exclude certain non-cash and non-recurring items) were $7.5 million
        and $0.09, respectively.

    -   As of December 31, 2007, cash and long-term investments were
        $115.8 million and net debt was $465.8 million.

    Fourth Quarter Business Highlights

    -   5-FU Central Venous Catheter ("CVC"). In December 2007 we submitted a
        510(k) application to the U.S. Food and Drug Administration (FDA) to
        market and sell our 5-FU CVC. We expect the clinical data from our
        recently completed 960 patient clinical trial, which evaluated the
        clinical performance of our 5-FU CVC as compared to a market leading
        anti-infective CVC, to be presented by the clinical investigators at
        the ISICEM 28th International Symposium on Intensive Care and
        Emergency Medicine in Brussels, Belgium on March 18, 2008. Should our
        5-FU CVC product candidate receive FDA marketing clearance, we would
        anticipate commencing commercial launch activities in the second half
        of 2008.

    -   Quill(TM) SRS: In October 2007 we received CE Mark approval to begin
        marketing the Quill(TM) Self-Retaining System (SRS) MONODERM(TM)
        product line in Europe. In addition, we exceeded our stated goal of
        100 Quill(TM) SRS hospital accounts by the end of 2007, and expect to
        expand the number of Quill(TM) SRS SKUs available for sale to our
        customers in 2008.

    -   Vascular Wrap(TM): Enrolment in our AV access human clinical trials
        in the U.S. and Europe continues and we currently expect to complete
        enrolment in these studies around the end of the first half of 2008.

    -   Stem Cell Therapies: In December 2007 our partner, Athersys, Inc.
        received authorization from the U.S. FDA to begin a Phase I clinical
        trial evaluating the safety of MultiStem(R) in the treatment of acute
        myocardial infarction. We have an agreement with Athersys to co-
        develop and commercialize MultiStem(R), Athersys' non-embryonic stem
        cell platform technology, for use in the indications of acute
        myocardial infarction and peripheral vascular disease.

    -   TAXUS(R) paclitaxel-eluting stent systems: In December 2007 our
        partner, BSC, announced that the TAXUS(R) Liberte(TM) paclitaxel-
        eluting coronary stent system received European CE Mark approval for
        use in diabetic patients.
    

    2008 Outlook

    Our financial outlook for the upcoming fiscal year ending December 31,
2008 is presented below. Several material factors and assumptions were used to
derive our 2008 outlook, including: (i) estimates of medical procedure and
patient population growth rates for the various end markets relating to our
medical products business; (ii) estimates of the impact of pricing changes,
pricing strategies and competition with respect to certain of our currently
marketed medical products; (iii) competitive analysis and estimates of
relative market share with respect to certain key product lines; (iv)
estimates of revenue growth and customer composition relating to our sales of
medical device components to other medical products companies; (v) analysis of
the impact of our manufacturing consolidation, product sales mix and pricing
on cost of goods sold; (vi) estimates of selling, general and administrative
expenses necessary to support our revenue growth and overall business goals;
and (vii) estimates of research and clinical expenses necessary to support our
various new product development and research programs.
    The outlook presented below contains estimates of certain expenses based
on non-GAAP measures, and are prepared consistent with our current and
previous presentations of our historical financial information. Specifically,
our outlook for research and clinical expenses, sales and marketing expenses
and general and administrative expenses exclude estimates for stock based
compensation expenses, for certain non-recurring expenses expected to be
incurred in the first half of 2008 related to the completion of the
consolidation of our Syracuse, NY operations, and for certain litigation
related expenses. The estimates for these certain operating expenses are
inherently unpredictable or subject to significant fluctuation for reasons
unrelated to our business performance.

    The key elements of our 2008 outlook are as follows:

    

    -   Medical Products year over year total revenue growth goal of 15% or
        greater, with higher growth expected from several selected promoted
        brand product lines, including Quill(TM) SRS, Skater(TM) drainage
        catheters, EnSnare(R) vascular retrieval devices, and our
        BioPince(TM) biopsy needle franchise, among others;

    -   Improvements in gross margins as compared to 2007, driven by a
        combination of expected improvements in product sales mix and the
        expected completion of the consolidation and closure of our
        operations in Syracuse, New York;

    -   Research and clinical expenses ranging from $45 to $50 million, with
        expenses weighted to the first half of 2008, driven primarily by
        continued clinical, manufacturing and pre-launch activities related
        to our 5-FU CVC and Vascular Wrap(TM) product candidates;

    -   Sales and marketing expenses ranging from $50 to $60 million, driven
        by the achievement of stated sales goals and the incurrence of a full
        year of certain expenses related to the 2007 expansion of our sales
        and marketing personnel;

    -   General and administrative expenses ranging from $40 to $45 million,
        reflecting continued reductions in selected administrative expenses
        as compared to 2007; and

    -   Capital expenditures ranging from $12 to $15 million.
    

    Our financial outlook is forward-looking information, and actual results
may be materially different from any results, events or developments expressed
or implied by our financial outlook. We expect our financial results may vary
from the outlook provided as a result of several key factors, including the
progress of our various research, clinical development and product launch
initiatives, the achievement of selected sales growth targets and the timing
of product sales growth, the outcome of various ongoing partnering, business
development and financing discussions, and the level of royalty revenues we
receive from our partner BSC in future periods and the impact such results may
have on our election to pursue certain discretionary aspects of our budgeted
expenses in 2008. It is expected that, at the present time, we will have
adequate cash and liquidity resources to execute our various research, product
development and growth initiatives in 2008.
    Our financial outlook is provided to give investors an assessment of our
expected financial results and our future business, and may not be appropriate
for any other purposes. Given the risks, uncertainties and assumptions
associated with such information, readers are cautioned not to place undue
reliance on our financial outlook. Except as required by law, we disclaim any
obligation to update our financial outlook.

    Financial Information
    ---------------------
    This press release contains the condensed financial information derived
from the preliminary unaudited interim consolidated financial statements for
the three month periods ended December 31, 2007 and 2006, and preliminary
unaudited consolidated financial statements for the years ended December 31,
2007 and 2006 as previously reported. The unaudited financial information
presented should be considered preliminary and is subject to potential
adjustments, including, but not limited to, potential adjustments to certain
tax related items, pending the conclusion of the 2007 year-end audit. Upon
completion of the 2007 year-end audit process and the approval of our full
year 2007 audited consolidated financial statements by our Board of Directors,
full audited consolidated financial statements and Management's Discussion and
Analysis for the three years ended December 31, 2007, will be filed with the
relevant regulatory agencies, as well as posted on our website at
www.angiotech.com.
    We completed the acquisition of the operations of American Medical
Instruments Holdings, Inc. ("AMI") on March 23, 2006. Because of the timing of
the AMI acquisition, our operating results for the twelve month period ended
December 31, 2006 include AMI's results of operations from the period of March
24, 2006 to December 30, 2006, as compared to the current twelve month period
which reflects combined results for the full year. As a result, our results
for the twelve months ended December 31, 2007 do not reflect a comparable
operating period as compared to the nine months ended December 31, 2006.
    Amounts, unless specified otherwise, are expressed in U.S. dollars.
Financial results are reported under GAAP unless otherwise noted. All per
share amounts are stated on a diluted basis unless otherwise noted.

    Use of Certain Non GAAP Financial Measures
    ------------------------------------------
    Certain financial results presented in this press release include
non-GAAP measures that exclude certain items. Adjusted net loss from
continuing operations, adjusted net loss per share from continuing operations
and adjusted earnings before interest, taxes, depreciation and amortization
("Adjusted EBITDA") exclude certain non-cash and non-recurring items such as
acquisition related amortization charges, acquired in-process research and
development relating to license agreements and acquisitions, stock-based
compensation expense, foreign exchange gains or losses relating to translation
of foreign currency cash and investment balances and other non-recurring
items. Adjusted net loss from continuing operations, adjusted net loss per
share from continuing operations and adjusted EBITDA also exclude litigation
expenses related to defending intellectual property claims. Revenue, as
adjusted, excludes non-recurring, non-operating revenue derived from license
agreements and other license revenue, net of license fees due to licensors and
excludes amounts accrued for costs incurred, and potential future costs,
related to our offer to accept returns of Contour Threads brand product as
part of our announced brand name consolidation and discontinuation. Adjusted
net loss from continuing operations, adjusted net loss per share from
continuing operations, revenue, as adjusted, and adjusted EBITDA do not have
any standardized meaning prescribed by GAAP and therefore may not be
comparable to similar measures presented by other issuers. Management uses
these non-GAAP or adjusted operating measures to establish operational goals,
and believes that these measures may assist investors in analyzing the
underlying trends in our business over time. Investors should consider these
non-GAAP measures in addition to, not as a substitute for, or as superior to,
financial reporting measures prepared in accordance with GAAP. We have
provided a reconciliation of these measures to GAAP in the attached tables.
    The financial outlook referred to above presents certain forward-looking,
non-GAAP financial information for which at this time there is no calculable
comparable GAAP measure. As a result, such non-GAAP financial information
cannot be quantitatively reconciled to comparable GAAP financial information.
Specifically, the estimates for certain operating expenses referred to above
exclude estimates of certain expenses that are inherently unpredictable or
subject to significant fluctuation for reasons unrelated to our business
performance, including stock-based compensation expenses, certain litigation
expenses and foreign exchange gains or losses.

    Conference Call Information
    ---------------------------
    A conference call to discuss these financial results will be held today,
Thursday, February 14, 2008 at 8:00 AM PT (11:00 AM ET).

    Dial-in information:
    North America (toll free): (866) 510-0711
    International: (617) 597-5379
    Enter passcode: 91184096

    A replay archive of the conference call will be available until
February 21, 2008 by calling (888) 286-8010 (in North America) or (617)
801-6888 (International) and entering Access Code 85112963.
    A live webcast will be available to all interested parties through the
Investors section of Angiotech's website: www.angiotech.com.

    
                       ANGIOTECH PHARMACEUTICALS, INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                 (Unaudited)

    (in thousands of
     U.S.$, except
     share and per         Three months ended         Three months ended
     share data)           December 31, 2007          December 31, 2006
    -------------------------------------------------------------------------
                                 Adjust-                    Adjust-
                       Reported   ments  Adjusted Reported   ments  Adjusted
    REVENUE
    Royalty revenue      27,158            27,158   47,475  (9,000)a  38,475
    Product sales, net   43,935    (401)b  43,534   44,726            44,726
    License fees            266    (266)c       -    1,052  (1,052)c       -
    -------------------------------------------------------------------------
                         71,359    (667)   70,692   93,253 (10,052)   83,201
    -------------------------------------------------------------------------
    EXPENSES
    License and royalty
     fees                 4,527             4,527    6,048             6,048
    Cost of products
     sold                24,158    (665)d  23,493   22,465            22,465
    Research and
     development         13,556    (150)e  13,406   12,165    (500)e  11,665
    Selling, general
     and administrative  27,180  (3,674)f  23,506   24,227  (6,229)f  17,998
    Depreciation and
     amortization         8,826  (7,993)g     833   14,288 (13,316)g     972
    In-process research
     and development        125    (125)h       -
    -------------------------------------------------------------------------
                         78,372 (12,607)   65,765   79,193 (20,045)   59,148
    -------------------------------------------------------------------------
    Operating (loss)
     income              (7,013) 11,940     4,927   14,060   9,993    24,053
    -------------------------------------------------------------------------
    Other income
     (expenses):
    Foreign exchange
     gain (loss)            173    (173)i       -   (1,263)  1,263 i       -
    Investment and
     other income           511     155 n     666    1,028       4 n   1,032
    Interest expense
     on long-term debt  (12,774)    558 j (12,216) (11,891)    699 j (11,192)
    Loss on redemption
     of investments           -       -         -      126    (126)l       -
    Loss on extinguish-
     ment of debt             -       -         -   (9,297)  9,297 m       -
    -------------------------------------------------------------------------
                        (12,090)    540   (11,550) (21,297) 11,137   (10,160)
    -------------------------------------------------------------------------
    Income (loss) from
     continuing
     operations before
     income taxes and
     cumulative effect
     of change in
     accounting         (19,103) 12,480    (6,623)  (7,237) 21,130    13,893
    Income tax expense
     (recovery)          (2,275)  3,149 k     874   (1,977)  3,880 k   1,903
    -------------------------------------------------------------------------
    Net (loss) income
     from continuing
     operations before
     cumulative effect
     of change in
     accounting         (16,828)  9,331    (7,497)  (5,260) 17,250    11,990
    -------------------------------------------------------------------------
    Net loss from
     discontinued
     operations, net
     of income taxes     (4,448)  4,448         -   (6,443)  6,443         -
    -------------------------------------------------------------------------
    Net (loss) income
     for the period     (21,276) 13,779    (7,497) (11,703) 23,693    11,990
    -------------------------------------------------------------------------

    Basic net (loss)
     income per common
     share from
     continuing
     operations           (0.20)            (0.09)   (0.06)             0.14
    Diluted net (loss)
     income per
     common share from
     continuing
     operations           (0.20)            (0.09)   (0.06)             0.14
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Weighted average
     shares outstanding
     (000's) - basic     85,030            85,030   84,984            84,984
    Weighted average
     shares outstanding
     (000's) - diluted   85,030            85,030   85,547            85,547
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    a.  One time revenue gain resulting from the up-front monetization of a
        royalty revenue stream to be received from our collaboration and
        distribution partnership with Orthovita.
    b.  Amounts accrued for costs incurred, and potential future costs,
        related to our offer to accept returns of Contour Threads brand
        product as part of consolidation and discontinuation of the Contour
        Threads brand name, coincident with the launch of our Quill SRS brand
        name.
    c.  Non-recurring revenue relating to selected licence agreements, net of
        licence fees due to licensors.
    d.  Change in estimate of accounting for excess and obsolete inventory
        resulting from the alignment during the fourth quarter of 2007 of
        inventory policies across our various manufacturing operations.
    e.  Stock-based compensation expense.
    f.  Selling, general and administrative adjustments:
        ---------------------------------------------------------------------
                                                 Three months   Three months
                                                ended Dec. 30, ended Dec. 30,
                                                     2007           2006
                                                -----------------------------
        Stock-based compensation expense                 (439)          (799)
        Termination and reorganization costs
         related to facility consolidation
         and integration activities                    (3,526)        (1,879)
        Litigation expenses relating to
         defending intellectual property claims           291         (3,551)
        ---------------------------------------------------------------------
                                                       (3,674)        (6,229)
        ---------------------------------------------------------------------
    g.  Amortization of acquisition related intangible assets and medical
        technologies.
    h.  Non-recurring in-process research and development relating to
        payments made to collaborators and licensors, including to
        CombinatoRx Inc. and Rex Medical Inc., and a non-recurring license
        termination payment of $125,000 to Lipose Corporation made in October
        2007.
    i.  Foreign exchange fluctuations on foreign currency net monetary
        assets.
    j.  Amortization of deferred financing costs.
    k.  Tax effects of adjustments for the period. Comparative for 2006 also
        includes non-recurring retroactive tax adjustment of $8.7 million
        relating to certain tax structures previously established in the
        province of Quebec, from which the previously expected benefits are
        not anticipated to be realized.
    l.  Loss on redemption of investments.
    m.  Loss on extinguishment of the term loans related to our December 2006
        senior floating rate note refinancing.
    n.  Includes write off of AMI tax receivable and write off of certain
        capitalized costs.



                       ANGIOTECH PHARMACEUTICALS, INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                 (Unaudited)

    (in thousands of
     U.S.$, except
     share and per             Year ended                 Year ended
     share data)           December 31, 2007          December 31, 2006
    -------------------------------------------------------------------------
                                 Adjust-                    Adjust-
                       Reported   ments  Adjusted Reported   ments  Adjusted
    REVENUE
    Royalty revenue     116,659           116,659  175,254  (9,000)a 166,254
    Product sales, net  170,193   2,579 b 172,772  138,590           138,590
    License fees            842    (842)c       -    1,231  (1,231)c       -
    -------------------------------------------------------------------------

                        287,694   1,737   289,431  315,075 (10,231)  304,844
    -------------------------------------------------------------------------
    EXPENSES
    License and royalty
     fees                18,652            18,652   25,409            25,409
    Cost of products
     sold                95,529  (2,645)d  92,884   68,263            68,263
    Research and
     development         53,963  (4,582)e  49,381   45,393  (2,490)e  42,903
    Selling, general
     and administrative  99,713 (16,868)f  82,845   78,732 (17,262)f  61,470
    Depreciation and
     amortization        33,429 (29,971)g   3,458   36,014 (32,707)g   3,307
    In-process research
     and development      8,125  (8,125)h       -    1,042  (1,042)h       -
    -------------------------------------------------------------------------
                        309,411 (62,191)  247,220  254,853 (53,501)  201,352
    -------------------------------------------------------------------------
    Operating (loss)
     income             (21,717) 63,928    42,211   60,222  43,270   103,492
    -------------------------------------------------------------------------
    Other income
     (expenses):
    Foreign exchange
     gain(loss)            (341)    341 i       -      515    (515)i       -
    Investment and
     other income        10,393  (5,422)j   4,971    6,522    (829)k   5,693
    Interest expense on
     long-term debt     (51,748)  2,242 l (49,506) (35,502)  2,019 l (33,483)
    Loss on
     sale/write-down
     of investments      (8,157)  8,157 m       -     (287)    287 n       -
    Loss extinguishment
     of debt                  -       -         -   (9,297)  9,297 o       -
    -------------------------------------------------------------------------
                        (49,853)  5,318   (44,535) (38,049) 10,259   (27,790)
    -------------------------------------------------------------------------
    Income (loss) from
     continuing
     operations before
     income taxes and
     cumulative effect
     of change in
     accounting         (71,570) 69,246    (2,324)  22,173  53,529    75,702
    Income tax expense
     (recovery)         (23,608) 17,589 p  (6,019)  10,279   4,933 p  15,212
    -------------------------------------------------------------------------
    Income (loss) from
     continuing
     operations before
     cumulative effect
     of change in
     accounting         (47,962) 51,657     3,695   11,894  48,596    60,490
    -------------------------------------------------------------------------
    Net loss from
     discontinued
     operations, net
     of income taxe     (11,395) 11,395         -   (7,708)  7,708         -
    -------------------------------------------------------------------------
    Cumulative effect
     of change in
     accounting               -       -         -      399    (399)        -
    -------------------------------------------------------------------------
    Net (loss) income
     for the period     (59,357) 63,052     3,695    4,585  55,905    60,490
    -------------------------------------------------------------------------
    Basic net (loss)
     income per common
     share from
     continuing
     operations           (0.56)             0.04     0.14              0.71
    Diluted net (loss)
     income per common
     share from
     continuing
     operations           (0.56)             0.04     0.14              0.71
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Weighted average
     shares outstanding
     (000's) - basic     85,015            85,015   84,752            84,752
    Weighted average
     shares outstanding
     (000's) - diluted   85,015            85,390   85,437            85,437
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    a.  One time revenue gain resulting from the up-front monetization of a
        royalty revenue stream to be received from our collaboration and
        distribution partnership with Orthovita.
    b.  Amounts accrued for costs incurred, and potential future costs,
        related to our offer to accept returns of Contour Threads brand
        product as part of consolidation and discontinuation of the Contour
        Threads brand name, coincident with the launch of our Quill SRS brand
        name.
    c.  Non-recurring, non-operating revenue as derived from license
        agreements with Histogenics Corporation ($0.4 million in 2007),
        Symphony Medical ($0.2 million in 2007) and other license revenue,
        net of license fees due to licensors. In 2006, as derived from
        license agreements with Baxter Heathcare Corporation ($1.0 million)
        and other license revenue, net of license fees due to licensors.
    d.  Change in estimate of accounting for excess and obsolete inventory
        resulting from the alignment during the third and fourth quarters of
        2007 of inventory policies across our various manufacturing
        operations, and non-recurring supply / distribution agreement
        termination costs.
    e.  Research and development adjustments:
        ---------------------------------------------------------------------
                                                  Year ended     Year ended
                                                Dec. 31, 2007  Dec. 31, 2006
                                               ------------------------------
        Stock-based compensation                       (1,665)        (2,490)
        Non-recurring license fees due to
         licensors                                       (419)             -
        Termination and reorganization costs
         related to the integration of AMI               (849)             -
        Non-recurring supply / distribution
         agreement termination costs                     (899)             -
        Non-recurring in-process research and
         development expense relating to the
         signing of a technology and intellectual
         property license agreement                      (750)             -
        ---------------------------------------------------------------------
                                                       (4,582)        (2,490)
        ---------------------------------------------------------------------
    f.  Selling,  general and administrative adjustments:
        ---------------------------------------------------------------------
                                                  Year ended     Year ended
                                                Dec. 31, 2007  Dec. 31, 2006
                                               ------------------------------

        Stock-based compensation                       (2,642)        (3,609)
        Termination and reorganization costs
         related to the integration of AMI             (8,365)        (1,879)
        Litigation expenses relating to
         defending intellectual property claims        (5,611)       (11,774)
        Non-recurring supply / distribution
         agreement termination costs                     (250)             -
        ---------------------------------------------------------------------
                                                      (16,868)       (17,262)
        ---------------------------------------------------------------------
    g.  Amortization of acquisition related intangible assets and medical
        technologies.
    h.  Non-recurring in-process research and development expense relating to
        payments made to licensors and collaborators, including CombinatorX
        Inc. and Rex Medical Inc.
    i.  Foreign exchange fluctuations on foreign currency net monetary
        assets.
    j.  Write off of uncollectible receivable and write off of certain
        capitalized costs, net of gain realized on recovery of investments.
    k.  Gain on sale of Palo Alto building and gain on sale related to
        disposition of Neodisc technology rights to NuVasive.
    l.  Amortization of deferred financing costs.
    m.  Net impact of loss and gain on redemption of investments of common
        share holdings in Orthovita Inc. and NuVasive, Inc., respectively.
    n.  Net impact of gain on redemption of investments and loss on write
        down of investments.
    o.  Loss on extinguishment of term loans related to our December 2006
        senior floating rate note refinancing.
    p.  Tax effects of adjustments a. through n. for the period, including
        the reversal of tax reserves previously booked. Comparative for 2006
        also includes non-recurring retroactive tax adjustment of
        $8.7 million relating to certain tax structures previously
        established in the province of Quebec, from which the previously
        expected benefits are not anticipated to be realized.



                       ANGIOTECH PHARMACEUTICALS, INC.
                       CALCULATION OF ADJUSTED EBITDA
                                 (Unaudited)

                                      Three months ended          Year ended
                                             December 31,        December 31,
    (in thousands of U.S.$)               2007      2006      2007      2006
    -------------------------------------------------------------------------

    Net income on a GAAP basis         (21,276)  (11,703)  (59,357)    4,585
    Interest expense on long-term debt  12,774    11,891    51,748    35,502
    Income tax expense                   2,173    (5,619)  (23,713)    6,247
    Depreciation and amortization        9,902    15,956    37,907    40,348
    -------------------------------------------------------------------------
    EBITDA                               3,573    10,525     6,585    86,682
    -------------------------------------------------------------------------
    Adjustments:
      Net loss from discontinued
       operations, excluding
       depreciation, amortization and
       income tax expense included
       above                                 -     9,242    11,122    10,497
      In-process research and
       development                         125         -     8,125     1,042
      Non-recurring research and
       development costs                     -         -       750         -
      Non-recurring revenue, net of
       license fees                       (266)  (10,052)     (426)  (10,231)
      Stock-based compensation             589     1,299     4,306     5,700
      Litigation expenses                 (291)    3,551     5,611    11,774
      Foreign exchange loss (gain)        (173)    1,263       340      (515)
      Investment and other income         (511)   (1,032)   (4,814)   (5,693)
      Severance / restructuring costs    3,526     1,879     8,964     1,879
      Supply/distribution agreement
       termination costs                     -         -     2,199         -
      E&O inventory adjustment             665         -     2,645         -
      Loss on extinguishment of debt         -     9,297         -     9,297
      Contour threads returns                -         -     2,579         -
      Write-off of capitalized costs      (401)        -       280         -
      Write-off of uncollectible tax
       receivable                            -         -     2,250         -
      Gain on sale of sale of
       intangible assets                     -         -         -      (148)
      Gain on sale of Palo Alto building     -         4         -      (681)
      Gain realized on recovery of
       investment                            -         -    (7,510)        -
      Accrued interest income                -         -      (597)        -
      Net loss on redemption of
       investments                           -      (126)    8,157       287
    -------------------------------------------------------------------------
    Adjusted EBITDA                      6,836    25,850    50,566   109,890
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



                       ANGIOTECH PHARMACEUTICALS, INC.
                    CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (Unaudited)

                                                  December 31,   December 31,
    (in thousands of U.S.$)                              2007           2006
    -------------------------------------------------------------------------
    ASSETS
    Cash and short-term investments                    91,326        108,617
    Accounts receivable                                22,678         25,231
    Inventories                                        33,647         33,619
    Deferred income taxes                               5,964          5,372
    Other current assets                                7,070          6,303
    Assets from discontinued operations                     -          2,365
    -------------------------------------------------------------------------
    Total current assets                              160,685        181,507
    -------------------------------------------------------------------------
    Long-term investments                              24,456         53,840
    Property and equipment, net                        59,187         59,783
    Intangible assets, net                            225,889        244,954
    Goodwill                                          660,591        630,770
    Deferred income taxes                                   -          4,804
    Deferred financing costs                           13,600         14,845
    Other assets                                        6,780            255
    Assets from discontinued operations                     -         15,116
    -------------------------------------------------------------------------
    Total assets                                    1,151,188      1,205,874
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    LIABILITIES AND SHAREHOLDERS' EQUITY
    Current liabilities                                67,182         67,950
    Liabilities from discontinued operations                -          4,226
    Long-term debt                                    575,000        575,000
    Deferred income taxes                              60,386         71,813
    Other tax liabilities                               2,425              -
    Other long-term liabilities                         4,614          4,052
    Stockholders' equity                              441,581        482,833
    -------------------------------------------------------------------------
    Total liabilities and stockholders' equity      1,151,188      1,205,874
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

    Forward Looking Statements
    --------------------------
    Statements contained in this press release that are not based on
    historical fact, including without limitation statements containing the
    words "believes," "may," "plans," "will," "estimate," "continue,"
    "anticipates," "intends," "expects" and similar expressions, constitute
    "forward-looking statements" within the meaning of the U.S. Private
    Securities Litigation Reform Act of 1995 and constitute "forward-looking
    information" within the meaning of applicable Canadian securities laws.
    All such statements are made pursuant to the "safe harbor" provisions of
    applicable securities legislation. Forward-looking statements may
    involve, but are not limited to, comments with respect to our strategies
    or future actions, our targets, expectations for our financial condition
    and the results of, or outlook for, our operations, research development
    and product and drug development. Such forward-looking statements involve
    known and unknown risks, uncertainties and other factors that may cause
    the actual results, events or developments to be materially different
    from any future results, events or developments expressed or implied by
    such forward-looking statements. Many such risks, uncertainties and other
    factors are taken into account as part of our assumptions underlying
    these forward-looking statements and include, among others, the
    following: general economic and business conditions, both nationally and
    in the regions in which we operate; market demand; technological changes
    that could impact our existing products or our ability to develop and
    commercialize future products; competition; existing governmental
    regulations and changes in, or the failure to comply with, governmental
    regulations; adverse results or unexpected delays in drug discovery and
    clinical development processes; decisions, and the timing of decisions,
    made by health regulatory agencies regarding approval of our technology
    and products; the requirement for substantial funding to conduct research
    and development and to expand commercialization activities or consummate
    acquisitions; sales numbers and future guidance publicly provided by
    Boston Scientific Corporation regarding sales of their paclitaxel-eluting
    coronary stent products; and any other factors that may affect
    performance. In addition, our business is subject to certain operating
    risks that may cause the actual results expressed or implied by the
    forward-looking statements in this report to differ materially from our
    actual results. These operating risks include: our ability to attract and
    retain qualified personnel; our ability to successfully complete
    preclinical and clinical development of our products; changes in business
    strategy or development plans; our failure to obtain patent protection
    for discoveries; loss of patent protection resulting from third party
    challenges to our patents; commercialization limitations imposed by
    patents owned or controlled by third parties; our ability to obtain
    rights to technology from licensors; liability for patent claims and
    other claims asserted against us; our ability to obtain and enforce
    timely patent and other intellectual property protection for our
    technology and products; the ability to enter into, and to maintain,
    corporate alliances relating to the development and commercialization of
    our technology and products; market acceptance of our technology and
    products; our ability to successfully manufacture, market and sell our
    products; the ability of Boston Scientific Corporation to successfully
    manufacture, market and sell their paclitaxel-eluting coronary stent
    products; the continued availability of capital to finance our
    activities; our ability to achieve the financial benefits expected as a
    result of the acquisition of American Medical Instruments Holdings, Inc.
    ("AMI"); and any other factors referenced in our annual information form
    and other filings with the applicable Canadian securities regulatory
    authorities or the SEC. Given these uncertainties, assumptions and risk
    factors, readers are cautioned not to place undue reliance on such
    forward-looking statements. We disclaim any obligation to update any such
    factors or to publicly announce the result of any revisions to any of the
    forward-looking statements contained in this press release to reflect
    future results, events or developments.

    Quill(TM) is a trademark of Quill Medical, Inc., a wholly-owned
    subsidiary of Angiotech Pharmaceuticals, Inc.
    (C)2008 Angiotech Pharmaceuticals, Inc. All Rights Reserved.
    Vascular Wrap(TM) is a trademark of Angiotech Pharmaceuticals, Inc.
    BioPince(TM) is a trademark of Medical Device Technologies, Inc.
    Skater(TM) is a trademark of PBN MEDICALS DENMARK A/S.
    MultiStem(R) is a registered trademark of Athersys, Inc.
    TAXUS(R) is a registered trademark of Boston Scientific Corporation.

    About Angiotech Pharmaceuticals

    Angiotech Pharmaceuticals, Inc. is a global specialty pharmaceutical and
medical device company with over 1,500 dedicated employees. Angiotech
discovers, develops and markets innovative treatment solutions for diseases or
complications associated with medical device implants, surgical interventions
and acute injury. To find out more about Angiotech (NASDAQ:   ANPI, TSX, ANP)
please visit our website at www.angiotech.com.




For further information:

For further information: Jodi Regts, Senior Manager, Investor Relations
and Corporate Communications, Angiotech Pharmaceuticals, Inc., (604) 221-7930,
jregts@angio.com; Deirdre Neary, Manager, Investor Relations and Corporate
Communications, Angiotech Pharmaceuticals, Inc., (604) 222-7056
dneary@angio.com

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Angiotech Pharmaceuticals, Inc.

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