-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
Originator-Key-Asymmetric:
 MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen
 TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
 Qu/D8XcUS+pRXb1Tvqltq+yWd2n95kTyUPfTNuMeOe/6chDOOtSIVWVxIujg0Upy
 UIHVNKdWuQwK4R3OTwNs+g==

<SEC-DOCUMENT>0001104659-04-023816.txt : 20040811
<SEC-HEADER>0001104659-04-023816.hdr.sgml : 20040811
<ACCEPTANCE-DATETIME>20040811144245
ACCESSION NUMBER:		0001104659-04-023816
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		5
CONFORMED PERIOD OF REPORT:	20040806
ITEM INFORMATION:		Results of Operations and Financial Condition
ITEM INFORMATION:		Financial statements and exhibits
FILED AS OF DATE:		20040811

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			ANIKA THERAPEUTICS INC
		CENTRAL INDEX KEY:			0000898437
		STANDARD INDUSTRIAL CLASSIFICATION:	BIOLOGICAL PRODUCTS (NO DIAGNOSTIC SUBSTANCES) [2836]
		IRS NUMBER:				043145961
		STATE OF INCORPORATION:			MA
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-14027
		FILM NUMBER:		04966778

	BUSINESS ADDRESS:	
		STREET 1:		236 WEST CUMMINGS PARK
		CITY:			WOBURN
		STATE:			MA
		ZIP:			01801
		BUSINESS PHONE:		6179326616

	MAIL ADDRESS:	
		STREET 1:		236 WEST CUMMINGS PARK
		CITY:			WOBURN
		STATE:			MA
		ZIP:			01801

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	ANIKA RESEARCH INC
		DATE OF NAME CHANGE:	19930309
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>a04-9340_18k.htm
<DESCRIPTION>8-K
<TEXT>
<html>

<head>



</head>

<body>

<div style="font-family:'Times New Roman';">

<div style="border:none;border-top:double windowtext 9.0pt;padding:0in 0in 0in 0in;">

<p style="border:none;margin:0in 0in .0001pt;padding:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

</div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="5" face="Times New Roman" style="font-size:18.0pt;font-weight:bold;">SECURITIES AND EXCHANGE COMMISSION</font></b></p>

<h1 style="letter-spacing:-.1pt;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">WASHINGTON, D.C. 20549</font></b></h1>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>


<div align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="1" width="25%" noshade color="black" align="center">

</font></div>


<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<h1 style="letter-spacing:-.1pt;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="5" face="Times New Roman" style="font-size:18.0pt;letter-spacing:0pt;">FORM 8-K</font></b></h1>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<h1 style="letter-spacing:-.1pt;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="3" face="Times New Roman" style="font-size:12.0pt;letter-spacing:0pt;">CURRENT
REPORT</font></b></h1>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<h1 style="letter-spacing:-.1pt;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="3" face="Times New Roman" style="font-size:12.0pt;letter-spacing:0pt;">PURSUANT TO SECTION 13 OR 15(D) OF THE</font></b></h1>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="3" face="Times New Roman" style="font-size:12.0pt;font-weight:bold;">SECURITIES
EXCHANGE ACT OF 1934</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>


<div align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="1" width="25%" noshade color="black" align="center">

</font></div>


<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Date of Report (Date of earliest event
reported):&#160;&#160; August 6, 2004</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="5" face="Times New Roman" style="font-size:18.0pt;font-weight:bold;">Anika Therapeutics,&nbsp;Inc.</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Exact Name of Registrant as Specified in Its Charter)</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="32%" valign="top" style="padding:0in 0in 0in 0in;width:32.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Massachusetts</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="32%" valign="top" style="padding:0in 0in 0in 0in;width:32.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">000-21326</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="32%" valign="top" style="padding:0in 0in 0in 0in;width:32.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">04-3145961</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="32%" valign="top" style="padding:0in 0in 0in 0in;width:32.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(State or Other Jurisdiction of<br>
  Incorporation or Organization)</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="32%" valign="top" style="padding:0in 0in 0in 0in;width:32.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Commission file<br>
  Number)</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="32%" valign="top" style="padding:0in 0in 0in 0in;width:32.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(I.R.S. Employer Identification No.)</font></p>
  </td>
 </tr>
 <tr>
  <td width="32%" valign="top" style="padding:0in 0in 0in 0in;width:32.0%;">
  <p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="32%" valign="top" style="padding:0in 0in 0in 0in;width:32.0%;">
  <p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="32%" valign="top" style="padding:0in 0in 0in 0in;width:32.0%;">
  <p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="66%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:66.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">160 New Boston Street, Woburn,
  Massachusetts</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="32%" valign="bottom" style="padding:0in 0in 0in 0in;width:32.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">01801</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="66%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:66.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Address of Principal Executive Offices)</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="32%" valign="top" style="padding:0in 0in 0in 0in;width:32.0%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Zip Code)</font></p>
  </td>
 </tr>
</table>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<h1 style="letter-spacing:-.1pt;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Registrant&#146;s Telephone Number,
Including Area Code: (781)&nbsp;932-6616</font></b></h1>

<div style="border:none;border-bottom:double windowtext 9.0pt;padding:0in 0in 0in 0in;">

<p style="border:none;margin:0in 0in .0001pt;padding:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

</div>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-ba.htm',USER='ssoundarrajan',CD='Aug 11 13:31 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">ITEM 7:&#160;
FINANCIAL STATEMTENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .25in;text-indent:-.25in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">(c)</font></b><b><font size="1" style="font-size:3.0pt;font-weight:bold;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Exhibits</b></p>

<p style="margin:0in 0in .0001pt .25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Exhibit 99.1 &#151; Press Release of Anika Therapeutics, Inc. dated August
6, 2004.</font></p>

<p style="margin:0in 0in .0001pt .25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Exhibit 99.2 &#151; Transcript of second quarter 2004 financial results
teleconference call held on August 6, 2004</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt 3.5pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">ITEM 12:&nbsp; RESULTS OF OPERATIONS AND
FINANCIAL CONDITION.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">On August 6, 2004, Anika Therapeutics, Inc. issued a press release
(&#147;Press Release&#148;) announcing its financial results for the second quarter of
2004.&nbsp; A copy of the Press Release is attached as Exhibit 99.1 to this
Current Report and is incorporated herein by reference.&#160; Additionally, on August 6, 2004, Anika held
a teleconference and webcast call to report its financial and operating results
for the second quarter of 2004.&#160; A
transcript of the call is attached as Exhibit 99.2 to this Current Report and
is incorporated herein by reference.&#160;
The furnishing of the conference call transcript shall not be deemed to
be an admission of the Company that any of the material contained in it is
material information of a financial or statistical nature relating to the
second quarter of 2004.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Such information, including the exhibits attached hereto, shall not be
deemed filed for any purpose, including for purposes of, Section&nbsp;18 of the
Securities and Exchange Act of 1934 (the &#147;Exchange Act&#148;) or otherwise subject
to the liabilities of that Section, nor shall it be deemed incorporated by
reference in any filing under the Securities Act of 1933 of the Exchange Act,
regardless of any general incorporation language in such filing.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Safe Harbor</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The
statements made in the press release and the transcript of the conference call
which are not statements of historical fact are forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933 and Section 21E
of the Securities Exchange Act of 1934, including, without limitation,
statements that may be identified by words such as &#147;expectations,&#148; &#147;remains,&#148;
&#147;focus,&#148; &#147;expected,&#148; &#147;prospective,&#148; &#147;expanding,&#148; &#147;building,&#148; &#147;continue,&#148;
&#147;progress,&#148; &#147;efforts,&#148; &#147;hope,&#148; &#147;believe,&#148; &#147;objectives,&#148; &#147;opportunities,&#148;
&#147;will,&#148; &#147;seek&#148; and other expressions which are predictions of or indicate
future events and trends and which do not constitute historical matters. These
statements also include statements regarding: (i) the Company&#146;s efforts and
expectations in entering into long-term arrangements to market and distribute
ophthalmic and osteoarthritis products, including the negative impact of
Advanced Medical Optics&#146; acquisition of Pharmacia&#146;s ophthalmic business, (ii)
the level of the Company&#146;s revenue or sales in particular geographic areas and/or
for particular products, (iii) the market share of any of the Company&#146;s
products, (iv) expectations regarding future results of operations, including
the Company&#146;s expectations regarding cash utilization, (v) the Company&#146;s
intention to strengthen, expand and grow its ophthalmic franchise and the
growth of the Company&#146;s ophthalmic business, (vi) the Company&#146;s expectations of
the size of the United States and European markets, including Germany and
France, for osteoarthritis of the knee, (vii) the Company&#146;s intention to
increase market share for OrthoVisc(R) in international and domestic markets or
otherwise penetrate growing markets for osteoarthritis of the knee, including
the timing of such objectives, (viii) the Company&#146;s corporate objectives and
research and development and collaboration opportunities, including, without
limitation, intended preclinical development of potential cosmetic tissue
augmentation products and commencement of INCERT(R)</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='2',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-ba.htm',USER='ssoundarrajan',CD='Aug 11 13:31 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">clinical
trials, (ix) the results of the U.S. launch for OrthoVisc(R). These statements
are based upon the current beliefs and expectations of the Company&#146;s management
and are subject to significant risks, uncertainties and other factors, (x) the
ability of the Company to experience tangible and material operational
improvements, (xi) the future tax rates of the Company, (xii) the Company&#146;s
expectations of the efforts of its distribution partners in marketing the
Company&#146;s products, and (xiii) the Company&#146;s efforts and expectations regarding
obtaining Medicare and Medicaid reimbursement codes for its products. The
Company&#146;s actual results could differ materially from any anticipated future
results, performance or achievements described in the forward-looking statements
as a result of a number of factors, including: (i) the Company&#146;s ability to
successfully commence and/or complete clinical trials of its products on a
timely basis or at all, obtain clinical data to support a pre-market approval
application and/or FDA approval, and/or receive FDA or other regulatory
approvals of its products, or that such approvals will not be obtained in a
timely manner or without the need for additional clinical trials; (ii) the
success of the Company&#146;s efforts to improve the financial performance of its
core business; (iii) the Company&#146;s research and product development efforts and
their relative success, including whether the Company has any meaningful sales
of any new products resulting from such efforts; (iv) the cost effectiveness
and efficiency of our manufacturing operations and production planning; (v) the
strength of the Turkish, German, Canadian, Middle Eastern and French economies,
in general and other economies in which the Company operates or will be
operating, as well as the political stability of any of those geographic areas,
or (vi) future determinations by the Company to allocate resources to products
and in directions not presently contemplated. Any delay in receiving any
regulatory approvals may adversely affect the Company&#146;s competitive position.
Even if regulatory approvals are obtained, there is a risk that meaningful
sales of the products may not be achieved. There is also a risk that (i) the
Company&#146;s existing distributors or customers will not continue to place orders
at historical levels or that any of them will seek to modify or terminate
existing arrangements, (ii) the Company&#146;s efforts to enter into long-term
marketing and distribution arrangements will not be successful, (iii) new
distribution arrangements, including the agreement with Ortho Biotech Products,
L.P. pertaining to OrthoVisc(R), will not result in meaningful sales of the
Company&#146;s products, (iv) the Company will be unable to achieve performance and
sales threshold milestones in its distribution agreements, (v) competitive
products will adversely impact the Company&#146;s product sales, (vi) the estimated
size(s) of the markets toward which the Company has targeted its products will
fail to be achieved, or (vii) increased sales of the Company&#146;s products,
including Hyvisc(R), OrthoVisc(R) or its ophthalmic products, will not continue
or sales will decrease or not reach historical sales levels, or even if such
increases occur that such increases will improve gross margins, any of which
may have a material adverse effect on the Company&#146;s business and operations.
Certain other factors that might cause the Company&#146;s actual results to differ
materially from those in the forward-looking statements include those set forth
under the headings &#147;Business,&#148; &#147;Risk Factors and Certain Factors Affecting
Future Operating Results&#148; and &#147;Management&#146;s Discussion and Analysis of
Financial Condition and Results of Operations&#148; in each of the Company&#146;s Annual
Report on Form 10-K for the year ended December 31, 2003, and its Quarterly
Report on Form 10-Q for the quarter ended March 31, 2004, and Current Reports
on Form 8-K, as well as those described in the Company&#146;s other press releases
and SEC filings.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='3',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-ba.htm',USER='ssoundarrajan',CD='Aug 11 13:31 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p style="font-weight:bold;letter-spacing:-.1pt;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">SIGNATURES</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="letter-spacing:-.1pt;margin:0in 0in .0001pt;text-align:left;text-indent:.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized in Woburn, Massachusetts on August 11,
2004.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="31%" valign="top" style="padding:0in 0in 0in 0in;width:31.02%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="68%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:68.98%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;text-transform:uppercase;">Anika Therapeutics, Inc.</font></p>
  </td>
 </tr>
 <tr>
  <td width="31%" valign="top" style="padding:0in 0in 0in 0in;width:31.02%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="5%" valign="top" style="padding:0in 0in 0in 0in;width:5.12%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="63%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:63.86%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="31%" valign="top" style="padding:0in 0in 0in 0in;width:31.02%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;August 11, 2004</font></p>
  </td>
  <td width="5%" valign="top" style="padding:0in 0in 0in 0in;width:5.12%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By:</font></p>
  </td>
  <td width="33%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:33.66%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">/s/&#160; Charles H. Sherwood</font></p>
  </td>
  <td width="30%" valign="top" style="padding:0in 0in 0in 0in;width:30.2%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="31%" valign="top" style="padding:0in 0in 0in 0in;width:31.02%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="5%" valign="top" style="padding:0in 0in 0in 0in;width:5.12%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="63%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:63.86%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles H. Sherwood, Ph.D.</font></p>
  </td>
 </tr>
 <tr>
  <td width="31%" valign="top" style="padding:0in 0in 0in 0in;width:31.02%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="5%" valign="top" style="padding:0in 0in 0in 0in;width:5.12%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="63%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:63.86%;">
  <p style="margin:0in 0in .0001pt;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">Chief Executive Officer and President</font></i></p>
  </td>
 </tr>
</table>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='4',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-ba.htm',USER='ssoundarrajan',CD='Aug 11 13:31 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Exhibit Index</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="8%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:8.82%;">
  <p style="margin:0in 0in .0001pt;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Exhibit No.</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.48%;">
  <p align="center" style="font-size:1.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>
  </td>
  <td width="88%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:88.7%;">
  <p align="center" style="margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Description</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="8%" valign="top" style="border:none;padding:0in 0in 0in 0in;width:8.82%;">
  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">99.1</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.48%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="88%" valign="top" style="border:none;padding:0in 0in 0in 0in;width:88.7%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Press Release of Anika Therapeutics, Inc. dated August 6, 2004</font></p>
  </td>
 </tr>
 <tr>
  <td width="8%" valign="top" style="padding:0in 0in 0in 0in;width:8.82%;">
  <p style="margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">99.2</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.48%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="88%" valign="top" style="padding:0in 0in 0in 0in;width:88.7%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Transcript of second quarter 2004 financial results teleconference
  call held<br>
  on August 6, 2004</font></p>
  </td>
 </tr>
</table>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

</div>


<!-- SEQ.=1,FOLIO='5',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-ba.htm',USER='ssoundarrajan',CD='Aug 11 13:31 2004' -->
</body>

</html>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>a04-9340_1ex99d1.htm
<DESCRIPTION>EX-99.1
<TEXT>
<html>

<head>



</head>

<body link="blue" vlink="purple">

<div style="font-family:'Times New Roman';">

<p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.15pt;">Exhibit 99.1</font></b></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;font-family:Univers;width:100.0%;">
 <tr>
  <td width="54%" valign="top" style="padding:0in 0in 0in 0in;width:54.16%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="3" face="Univers"><img width="157" height="58" src="g93401mmimage002.jpg"></font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.18%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="43%" valign="bottom" style="padding:0in 0in 0in 0in;width:43.66%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;letter-spacing:-.15pt;">NEWS RELEASE</font></b></p>
  </td>
 </tr>
</table>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:windowtext;line-height:normal;margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Contacts:</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;font-family:Univers;width:100.0%;">
 <tr style="font-family:'Times New Roman';">
  <td width="54%" valign="top" style="padding:0in 0in 0in 0in;width:54.0%;">
  <h3 style="color:windowtext;font-weight:bold;letter-spacing:-.15pt;margin:0in 0in .0001pt;page-break-after:auto;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Anika
  Therapeutics, Inc.</font></b></h3>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.4%;">
  <h3 style="color:windowtext;font-size:1.0pt;font-weight:bold;letter-spacing:-.15pt;margin:0in 0in .0001pt;page-break-after:auto;">&nbsp;</h3>
  </td>
  <td width="43%" valign="top" style="padding:0in 0in 0in 0in;width:43.6%;">
  <h3 style="color:windowtext;font-weight:bold;letter-spacing:-.15pt;margin:0in 0in .0001pt;page-break-after:auto;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">PondelWilkinson
  Klein</font></b></h3>
  </td>
 </tr>
 <tr>
  <td width="54%" valign="top" style="padding:0in 0in 0in 0in;width:54.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
  Sherwood, Ph.D., CEO</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.4%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="43%" valign="top" style="padding:0in 0in 0in 0in;width:43.6%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Susan
  Klein (508) 358-4315</font></p>
  </td>
 </tr>
 <tr style="font-family:'Times New Roman';">
  <td width="54%" valign="top" style="padding:0in 0in 0in 0in;width:54.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">William Knight, CFO</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.4%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="43%" valign="top" style="padding:0in 0in 0in 0in;width:43.6%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Whetstone (310)
  279-5963</font></p>
  </td>
 </tr>
 <tr>
  <td width="54%" valign="top" style="padding:0in 0in 0in 0in;width:54.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(781)
  932-6616</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.4%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="43%" valign="top" style="padding:0in 0in 0in 0in;width:43.6%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
</table>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:windowtext;font-weight:bold;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">ANIKA THERAPEUTICS
REPORTS 89% REVENUE INCREASE TO</font></b></p>

<p style="color:windowtext;font-weight:bold;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">$6.3 MILLION FOR SECOND
QUARTER</font></b></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:windowtext;line-height:normal;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">WOBURN, Mass. &#150; </font><font size="2" style="font-size:10.0pt;">August 6, 2004 &#150; Anika
Therapeutics, Inc. (NASDAQ:ANIK) today reported that revenue for the second
quarter ended June 30, 2004, increased 89% to $6,262,000 from $3,318,000 in the
second quarter of 2003.&#160; The company
posted net income of $765,000, or $.07 per diluted share, for the latest
quarter compared with a net loss of $81,000, or $.01 per share, for the same
period last year.</font></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:windowtext;line-height:normal;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Revenue for the six-month
period ended June 30, 2004 rose 85% to $12,403,000 from $6,702,000 for the
comparable period last year.&#160; Net income
was $8,551,000, or $.75 per diluted share, for the first six months of 2004
compared with a net loss of $394,000, or $.04 per share, for the first six
months of 2003.&#160; Year-to-date results
for 2004 include a one-time tax benefit amounting to $7,039,000 recorded in the
first quarter.</font></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:windowtext;line-height:normal;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Product revenue was $5,690,000 for the second quarter,
an increase of 72% from $3,303,000 for the same period last year.&#160; Product revenue included sales of OrthoVisc<sup>&#174;</sup>
to Ortho Biotech Products, L.P., which began marketing the osteoarthritis
treatment in the U.S. in March 2004, along with royalty payments tied to U.S.
OrthoVisc end-user sales.&#160; Licensing and
milestone revenue for each of the first two quarters included $550,000 (or $1.1
million for the 6-month period ended June 30, 2004) attributable to the
amortization of the upfront and milestone payments received in connection with
the licensing and supply agreement with Ortho Biotech.</font></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:windowtext;line-height:normal;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles H. Sherwood, Ph.D., president and chief
executive officer, attributed the revenue increase to U.S. sales of OrthoVisc
as well as growth in international sales of the product.&#160; Sales of OrthoVisc</font></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(more)</font></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>


<div style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mm.htm',USER='ssoundarrajan',CD='Aug 11 13:31 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p style="color:windowtext;line-height:normal;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">accounted for 49% of total product sales for the quarter.&#160; &#147;In addition to U.S. sales, we saw good
sales growth for OrthoVisc during the quarter in Turkey, Spain and Italy, and
had first-time sales to Germany and two new Middle Eastern territories,&#148;
Sherwood said.&#160; He noted that the
company recently received reimbursement approval for OrthoVisc from France and
looks to begin booking sales there in the second half of 2004.</font></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:windowtext;line-height:normal;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Sales of the company&#146;s
ophthalmic products, which contributed 47% of product sales for the quarter,
rose 22% compared to the second quarter of last year.&#160; Sherwood cautioned that ophthalmic sales, which are up 21% year
to date as compared to the same period last year, are expected to decline in
2005 due to a key customer&#146;s acquisition of a competing supplier.&#160; Sales of Hyvisc</font><sup><font size="2" style="font-size:10.0pt;">&#174;</font></sup><font size="2" style="font-size:10.0pt;">, the company&#146;s product for
equine osteoarthritis, were down 23% for the quarter as compared to the prior
year, primarily due to increasing competitive pressure in the equine
osteoarthritis marketplace.&#160; Hyvisc
accounted for approximately 4% of product sales for the period.</font></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:windowtext;line-height:normal;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Gross margin on product
revenue for the second quarter of 2004 was 57% compared with 44% for the same
period last year, reflecting a shifting revenue mix, increased unit volumes and
manufacturing efficiency gains.</font></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:windowtext;line-height:normal;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total operating expenses
were up 59% to $2,532,000 for the second quarter of 2004 as compared to
$1,593,000 in the second quarter of 2003.&#160;
The increase reflects research and development activity associated with
two recently launched clinical trials and an increase in selling, general and administrative
expenses related to increases in personnel costs and professional service fees,
and initiatives to build international sales.&#160;
A </font><font size="2" style="font-size:10.0pt;">provision
for taxes of $603,000 related to second quarter income was recorded in the
second quarter of 2004.</font></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:windowtext;line-height:normal;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A</font><font size="2" style="font-size:10.0pt;">nika&#146;s cash and cash equivalents at June 30,
2004 totaled $33.5 million.&#160; The company
has no long-term debt.</font></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:windowtext;line-height:normal;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Anika commenced two clinical
trials during the second quarter.&#160; The
first, encompassing approximately 45 patients undergoing spinal surgery in the
United Kingdom, is a pilot study to</font></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(more)</font></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2</font></p>


<div style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='2',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mm.htm',USER='ssoundarrajan',CD='Aug 11 13:31 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p style="color:windowtext;line-height:normal;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">evaluate INCERT<sup>&#174;</sup>,
a gel-like potential product designed to prevent post-surgical adhesions. The
trial is being partially subsidized by Surgicraft Limited, a U.K.-based medical
device manufacturer and distributor, which has been awarded U.K. marketing
rights.&#160; Surgicraft is Anika&#146;s U.K.
distributor for OrthoVisc.</font></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:windowtext;line-height:normal;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In the United States, Anika
commenced a Phase III pivotal clinical trial for a potential cosmetic tissue
augmentation (CTA) therapy.&#160; The trial
involves approximately 200 patients and is being conducted by dermatologists
and plastic surgeons at up to 10 centers throughout the U.S.</font></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:windowtext;line-height:normal;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">As announced on July 26, 2004, Anika signed an
exclusive worldwide development and commercialization partnership with the
Ortho Neutrogena division of Ortho-McNeil Pharmaceuticals, Inc., an affiliate
of Johnson &amp; Johnson, for the company&#146;s CTA therapy.&#160; Under the terms of the agreement, Anika will
receive an initial payment of $1.0 million and Ortho Neutrogena will fund the
ongoing pivotal clinical trial for the CTA therapy product initiated in May
2004.&#160; The agreement also provides for
performance and sales based milestone payments in addition to royalty payments
and transfer payments for the supply of CTA.</font></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:windowtext;font-weight:bold;letter-spacing:-.15pt;line-height:normal;margin:0in 0in .0001pt;page-break-after:auto;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Conference Call Information</font></b></p>

<p style="color:windowtext;line-height:normal;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The company will hold a conference call to review its
financial results on Friday, August 6, 2004 at 11:00 a.m. EDT.&#160; To listen to the conference call, dial (706)
634-1550 approximately 10 minutes before the starting time and reference Anika
Therapeutics.&#160; In addition, the
conference call will be available to interested parties through a live audio
Internet broadcast at http://www.anikatherapeutics.com.&#160; The call will be archived and accessible on
the same Web site for one year beginning at 2:00 p.m. EDT Friday, August 6,
2004.</font></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">About Anika Therapeutics, Inc.</font></b></p>

<p style="color:windowtext;line-height:normal;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Headquartered in Woburn, Mass., Anika Therapeutics,
Inc. (www.anikatherapeutics.com) develops, manufactures and commercializes
therapeutic products and devices intended to promote the repair, protection and
healing of bone, cartilage and soft tissue.&#160;
These products are based on hyaluronic acid (HA), a naturally occurring,
biocompatible polymer found throughout the body.&#160; Anika products</font></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3</font></p>


<div style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='3',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mm.htm',USER='ssoundarrajan',CD='Aug 11 13:31 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p style="color:windowtext;line-height:normal;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">include OrthoVisc<sup>&#174;</sup>, a treatment for
osteoarthritis of the knee available internationally and marketed in the U.S.
by Ortho Biotech Products, L.P., and Hyvisc<sup>&#174;</sup>, a treatment for equine
osteoarthritis marketed in the U.S. by Boehringer Ingelheim Vetmedica,
Inc.&#160; Anika manufactures Amvisc<sup>&#153; </sup>and
Amvisc Plus<sup>&#153;</sup>, HA viscoelastic products for ophthalmic surgery, for
Bausch &amp; Lomb.&#160; It also produces
CoEase<sup>&#153;</sup>, which is marketed by Advanced Medical Optics, Inc.,
STAARVISC<sup>&#153;</sup>-II distributed by STAAR Surgical Company and Shellgel<sup>&#153;</sup>
for Cytosol Ophthalmics, Inc.</font></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:#012383;margin:0in 0in .0001pt;"><i><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-style:italic;">The statements made in this press release which are not
statements of historical fact are forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934, including, without limitation, statements that may be
identified by words such as &#147;expectations,&#148; &#147;remains,&#148; &#147;focus,&#148; &#147;expected,&#148;
&#147;prospective,&#148; &#147;expanding,&#148; &#147;building,&#148; &#147;continue,&#148; &#147;progress,&#148; &#147;efforts,&#148;
&#147;hope,&#148; &#147;believe,&#148; &#147;objectives,&#148; &#147;opportunities,&#148; &#147;will,&#148; &#147;seek,&#148; and other
expressions which are predictions of or indicate future events and trends and
which do not constitute historical matters identify forward-looking statements.&#160; These statements also include statements
regarding: (i) the Company&#146;s efforts and expectations in entering into
long-term arrangements to market and distribute ophthalmic and osteoarthritis
products, (ii) the level of the Company&#146;s revenue or sales in particular geographic
areas and/or for particular products, (iii) the market share of any of the
Company&#146;s products, (iv) expectations regarding future results of operations,
including the Company&#146;s expectations regarding cash utilization, (v) the
Company&#146;s intention to strengthen, expand and grow its ophthalmic franchise and
the growth of the Company&#146;s ophthalmic business, (vi) the Company&#146;s
expectations of the size of the United States and European markets, including
Germany and France, for osteoarthritis of the knee, (vii) the Company&#146;s
intention to increase market share for ORTHOVISC<sup>&#174;</sup> in international
and domestic markets or otherwise penetrate growing markets for osteoarthritis
of the knee, (viii) the Company&#146;s corporate objectives and research and
development and collaboration opportunities, including, without limitation,
intended preclinical development of potential cosmetic tissue augmentation
products and commencement of INCERT<sup>&#174; </sup>clinical trials and (ix) the
results of the U.S. launch for ORTHOVISC<sup>&#174;</sup>.&#160; These statements are based upon the current beliefs and
expectations of the Company&#146;s management and are subject to significant risks,
uncertainties and other factors.&#160; The
Company&#146;s actual results could differ materially from any anticipated future
results, performance or achievements described in the forward-looking
statements as a result of a number of factors including: (i) the Company&#146;s
ability to successfully commence and/or complete clinical trials of its
products on a timely basis or at all, obtain clinical data to support a
pre-market approval application and/or FDA approval, and/or receive FDA or
other regulatory approvals of its products, or that such approvals will not be
obtained in a timely manner or without the need for additional clinical trials;
(ii) the success of the Company&#146;s efforts to improve the financial performance
of its core business; (iii) the Company&#146;s research and product development
efforts and their relative success, including whether the Company has any
meaningful sales of any new products resulting from such efforts; (iv) the cost
effectiveness and efficiency of our manufacturing operations and production
planning; (v) the strength of the Turkish, German, Canadian, Middle Eastern and
French economies, in general and other economies in which the Company operates
or will be operating, as well as the political stability of any of those
geographic areas or (vi) future determinations by the Company to allocate
resources to products and in directions not presently contemplated.&#160; Any delay in receiving any regulatory
approvals may adversely affect the Company&#146;s competitive position.&#160; Even if regulatory approvals are obtained,
there is a risk that meaningful sales of the products may not be achieved.&#160; There is also a risk that (i) the Company&#146;s
existing distributors or customers will not continue to place orders at
historical levels or that any of them will seek to modify or terminate existing
arrangements, (ii) the Company&#146;s efforts to enter into long-term marketing and
distribution arrangements will not be successful, (iii) new distribution
arrangements, including the agreement with Ortho Biotech Products, L.P.
pertaining to ORTHOVISC<sup>&#174;</sup>, will not result in meaningful sales of the
Company&#146;s products, (iv) the Company will be unable to achieve performance and
sales threshold milestones in its distribution agreements, (v) competitive
products will adversely impact the Company&#146;s product sales, (vi) the estimated
size(s) of the markets which the Company has targeted its products will fail to
be achieved, or (vii) increased sales of the Company&#146;s products, including
HYVISC<sup>&#174;</sup>, ORTHOVISC<sup>&#174;</sup>, or its ophthalmic products, will not
continue or sales will decrease or not reach historical sales levels, or even
if such increases occur that such increases will improve gross margins, any of
which may have a material adverse effect on the Company&#146;s business and
operations.&#160; Certain other factors that
might cause the Company&#146;s actual results to differ materially from those in the
forward-looking statements include those set forth under the headings
&#147;Business,&#148; &#147;Risk Factors and Certain Factors Affecting Future Operating</font></i></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4</font></p>


<div style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='4',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mm.htm',USER='ssoundarrajan',CD='Aug 11 13:31 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p style="color:#012383;margin:0in 0in .0001pt;"><i><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-style:italic;">Results&#148; and &#147;Management&#146;s Discussion and Analysis of
Financial Condition and Results of Operations&#148; in each of the Company&#146;s Annual
Report on Form 10-K for the year ended December 31, 2003, and its Quarterly
Report on Form 10-Q for the quarter ended March 31, 2004 and Current Reports on
Form 8-K, as well as those described in the Company&#146;s other press releases and
SEC filings.</font></i></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">#&#160;
#&#160; #</font></b></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Financial Tables to Follow</font></b></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5</font></p>


<div style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='5',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mm.htm',USER='ssoundarrajan',CD='Aug 11 13:31 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">&nbsp;</font></b></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Anika
Therapeutics, Inc. and Subsidiaries</font></b></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Consolidated
Statements of Operations</font></b></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">(unaudited)</font></b></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="43%" valign="bottom" style="padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="26%" colspan="5" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:26.0%;">
  <p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Quarter
  Ended<br>
  June 30,</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="26%" colspan="5" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:26.0%;">
  <p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">Six Months
  Ended<br>
  June 30,</font></b></p>
  </td>
  <td width="0%" valign="bottom" style="padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" style="padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">2004</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border-bottom:solid windowtext .5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">2003</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">2004</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="border:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border-bottom:solid windowtext .5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">2003</font></b></p>
  </td>
  <td width="0%" valign="bottom" style="padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" style="padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="0%" valign="bottom" style="padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Product revenue</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.7%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5,690,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.7%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3,303,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.7%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11,259,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:10.7%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6,673,000</font></p>
  </td>
  <td width="0%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" style="padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Licensing and milestone revenue</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">572,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">15,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,144,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">29,000</font></p>
  </td>
  <td width="0%" valign="bottom" style="padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total revenue</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6,262,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3,318,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">12,403,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6,702,000</font></p>
  </td>
  <td width="0%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" style="padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Cost of product revenue</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,442,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,846,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5,163,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3,815,000</font></p>
  </td>
  <td width="0%" valign="bottom" style="padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Gross profit</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3,820,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,472,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7,240,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,887,000</font></p>
  </td>
  <td width="0%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" style="padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Operating expenses:</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="0%" valign="bottom" style="padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Research and development</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,125,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">648,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,032,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,457,000</font></p>
  </td>
  <td width="0%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" style="padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Selling, general and administrative</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,407,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">945,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,715,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,060,000</font></p>
  </td>
  <td width="0%" valign="bottom" style="padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total operating expenses</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,532,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,593,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4,747,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3,517,000</font></p>
  </td>
  <td width="0%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" style="padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Income (loss) from operations</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,288,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(121,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,493,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(630,000</font></p>
  </td>
  <td width="0%" valign="bottom" style="padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Interest income</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">80,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">40,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">126,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">82,000</font></p>
  </td>
  <td width="0%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" style="padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Income (loss) before income tax expense (benefit)</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,368,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(81,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,619,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(548,000</font></p>
  </td>
  <td width="0%" valign="bottom" style="padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Income tax expense (benefit)</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="0%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" style="padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Provision (benefit) for income taxes</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">603,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,107,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(154,000</font></p>
  </td>
  <td width="0%" valign="bottom" style="padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 20.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Benefit from release of valuation allowance</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(7,039,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>
  </td>
  <td width="0%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" style="padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net income (loss)</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.7%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">765,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.7%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(81,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.7%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8,551,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:10.7%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(394,000</font></p>
  </td>
  <td width="0%" valign="bottom" style="padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="0%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" style="padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Basic net income (loss) per share</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.7%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">0.08</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.7%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(0.01</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.7%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">0.85</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.7%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(0.04</font></p>
  </td>
  <td width="0%" valign="bottom" style="padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Basic shares outstanding</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10,060,866</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9,941,121</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10,024,138</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9,937,719</font></p>
  </td>
  <td width="0%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" style="padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="0%" valign="bottom" style="padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Diluted net income (loss) per share</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.7%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">0.07</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.7%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(0.01</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.7%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">0.75</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="10%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:10.7%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(0.04</font></p>
  </td>
  <td width="0%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="43%" valign="bottom" style="padding:0in 0in 0in 0in;width:43.02%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Diluted shares outstanding</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11,396,116</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9,941,121</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11,333,899</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.0%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="12%" colspan="2" valign="bottom" style="border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:12.0%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9,937,719</font></p>
  </td>
  <td width="0%" valign="bottom" style="padding:0in 0in 0in 0in;width:.98%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6</font></p>


<div style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='6',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mm.htm',USER='ssoundarrajan',CD='Aug 11 13:31 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p align="center" style="color:windowtext;font-weight:bold;letter-spacing:-.15pt;line-height:normal;margin:0in 0in .0001pt;page-break-after:auto;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;letter-spacing:0pt;">Anika
Therapeutics, Inc. and Subsidiaries</font></b></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Consolidated
Balance Sheets</font></b></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">(unaudited)</font></b></p>

<p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="62%" valign="bottom" style="padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">June 30,
  2004</font></b></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><b><font size="1" face="Times New Roman" style="font-size:8.0pt;font-weight:bold;">December
  31, 2003</font></b></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:62.5%;">
  <p align="center" style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-align:center;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">ASSETS</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" style="padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Current assets:</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Cash and cash equivalents</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="14%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:14.22%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">33,536,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="14%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:14.22%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">14,592,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" style="padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Restricted cash</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">818,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accounts receivable, net</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,693,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,421,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" style="padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Inventories</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3,749,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3,627,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Current portion deferred income taxes</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,270,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" style="padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Prepaid expenses and other current assets</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">995,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">81,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 50.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total current assets</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">41,243,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">20,539,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" style="padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Property and equipment</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10,103,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9,875,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Less accumulated depreciation</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(9,021,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(8,684,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" style="padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 50.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Net property and equipment</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,082,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,191,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Long-term deposits</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">143,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">143,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" style="padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Deferred income taxes</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8,202,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total assets</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="14%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:14.22%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">50,670,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="14%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:14.22%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">21,873,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" style="padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="border:none;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:62.5%;">
  <p align="center" style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-align:center;text-indent:-10.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">LIABILITIES
  AND STOCKHOLDERS&#146; EQUITY</font></b></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" style="padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Current liabilities:</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accounts payable</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="14%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:14.22%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">587,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="14%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:14.22%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">349,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" style="padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Other accrued expenses</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,433,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,297,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Deferred revenue</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3,120,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">378,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" style="padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Income taxes payable</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">65,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 50.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total current liabilities</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5,140,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2,089,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" style="padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Long-term deferred revenue</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">18,700,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1,800,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" style="padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;font-size:10.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Stockholders&#146; equity:</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;text-align:right;">&nbsp;</p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" style="padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Common stock</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">101,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">100,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Additional paid-in capital</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">31,747,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">31,480,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" style="padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Treasury stock</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#151;</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(27,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 30.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Accumulated deficit</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(5,018,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(13,569,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">)</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" style="padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 50.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total stockholders&#146; equity</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">26,830,000</font></p>
  </td>
  <td width="2%" valign="bottom" style="padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="15%" colspan="2" valign="bottom" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:15.52%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">17,984,000</font></p>
  </td>
  <td width="1%" valign="bottom" style="padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="62%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:62.5%;">
  <p style="color:windowtext;margin:0in 0in .0001pt 10.0pt;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Total liabilities and stockholders&#146; equity</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="14%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:14.22%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">50,670,000</font></p>
  </td>
  <td width="2%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:2.58%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border:none;border-bottom:double windowtext 1.5pt;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">$</font></p>
  </td>
  <td width="14%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;border-bottom:double windowtext 1.5pt;border-left:none;border-right:none;border-top:solid windowtext .5pt;padding:0in 0in 0in 0in;width:14.22%;">
  <p align="right" style="color:windowtext;margin:0in 0in .0001pt;text-align:right;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">21,873,000</font></p>
  </td>
  <td width="1%" valign="bottom" bgcolor="#cceeff" style="background:#CCEEFF;padding:0in 0in 0in 0in;width:1.3%;">
  <p style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:1.0pt;">&nbsp;</font></p>
  </td>
 </tr>
</table>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="color:windowtext;margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7</font></p>


<div style="color:windowtext;margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

</div>


<!-- SEQ.=1,FOLIO='7',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mm.htm',USER='ssoundarrajan',CD='Aug 11 13:31 2004' -->
</body>

</html>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.2
<SEQUENCE>3
<FILENAME>a04-9340_1ex99d2.htm
<DESCRIPTION>EX-99.2
<TEXT>
<html>

<head>



</head>

<body>

<div style="font-family:Arial;">

<p align="right" style="margin:0in 0in .0001pt;text-align:right;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Exhibit 99.2</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Safe Harbor</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The
statements made in the press release and the transcript of the conference call
which are not statements of historical fact are forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933 and Section 21E
of the Securities Exchange Act of 1934, including, without limitation,
statements that may be identified by words such as &#147;expectations,&#148; &#147;remains,&#148;
&#147;focus,&#148; &#147;expected,&#148; &#147;prospective,&#148; &#147;expanding,&#148; &#147;building,&#148; &#147;continue,&#148;
&#147;progress,&#148; &#147;efforts,&#148; &#147;hope,&#148; &#147;believe,&#148; &#147;objectives,&#148; &#147;opportunities,&#148;
&#147;will,&#148; &#147;seek&#148; and other expressions which are predictions of or indicate
future events and trends and which do not constitute historical matters. These
statements also include statements regarding: (i) the Company&#146;s efforts and
expectations in entering into long-term arrangements to market and distribute
ophthalmic and osteoarthritis products, including the negative impact of
Advanced Medical Optics&#146; acquisition of Pharmacia&#146;s ophthalmic business, (ii)
the level of the Company&#146;s revenue or sales in particular geographic areas
and/or for particular products, (iii) the market share of any of the Company&#146;s
products, (iv) expectations regarding future results of operations, including
the Company&#146;s expectations regarding cash utilization, (v) the Company&#146;s
intention to strengthen, expand and grow its ophthalmic franchise and the
growth of the Company&#146;s ophthalmic business, (vi) the Company&#146;s expectations of
the size of the United States and European markets, including Germany and
France, for osteoarthritis of the knee, (vii) the Company&#146;s intention to
increase market share for OrthoVisc(R) in international and domestic markets or
otherwise penetrate growing markets for osteoarthritis of the knee, including
the timing of such objectives, (viii) the Company&#146;s corporate objectives and
research and development and collaboration opportunities, including, without
limitation, intended preclinical development of potential cosmetic tissue
augmentation products and commencement of INCERT(R) clinical trials, (ix) the
results of the U.S. launch for OrthoVisc(R). These statements are based upon
the current beliefs and expectations of the Company&#146;s management and are
subject to significant risks, uncertainties and other factors, (x) the ability
of the Company to experience tangible and material operational improvements,
(xi) the future tax rates of the Company, (xii) the Company&#146;s expectations of
the efforts of its distribution partners in marketing the Company&#146;s products,
and (xiii) the Company&#146;s efforts and expectations regarding obtaining Medicare
and Medicaid reimbursement codes for its products. The Company&#146;s actual results
could differ materially from any anticipated future results, performance or
achievements described in the forward-looking statements as a result of a
number of factors, including: (i) the Company&#146;s ability to successfully
commence and/or complete clinical trials of its products on a timely basis or
at all, obtain clinical data to support a pre-market approval application
and/or FDA approval, and/or receive FDA or other regulatory approvals of its
products, or that such approvals will not be obtained in a timely manner or
without the need for additional clinical trials; (ii) the success of the
Company&#146;s efforts to improve the financial performance of its core business;
(iii) the Company&#146;s research and product development efforts and their relative
success, including whether the Company has any meaningful sales of any new
products resulting from such efforts; (iv) the cost effectiveness and
efficiency of our manufacturing operations and production planning; (v) the
strength of the Turkish, German, Canadian, Middle Eastern and French economies,
in general and other economies in which the Company operates or will be operating,
as well as the political stability of any of those geographic areas, or (vi)
future determinations by the Company to allocate resources to products and in
directions not presently contemplated. Any delay in receiving any regulatory
approvals may adversely affect the Company&#146;s competitive position. Even if
regulatory approvals are obtained, there is a risk that meaningful sales of the
products may not be achieved. There is also a risk that (i) the Company&#146;s
existing distributors or customers will not continue to place orders at
historical levels or that any of them will seek to modify or terminate existing
arrangements, (ii) the Company&#146;s efforts to enter into long-term marketing and
distribution arrangements will not be successful, (iii) new distribution
arrangements, including the agreement with Ortho Biotech Products, L.P.
pertaining to OrthoVisc(R), will not result in meaningful sales of the
Company&#146;s products, (iv) the Company will be unable to achieve performance and
sales threshold milestones in its distribution agreements, (v) competitive
products will adversely impact the Company&#146;s product sales, (vi) the estimated
size(s) of the markets toward which the Company has targeted its products will
fail to be achieved, or (vii) increased sales of the Company&#146;s products,
including Hyvisc(R), OrthoVisc(R) or its ophthalmic products, will not continue
or sales will decrease or not reach historical sales levels, or even if such
increases occur that such increases will improve gross margins, any of which
may have a material adverse effect on the Company&#146;s business and operations.
Certain other factors that might cause the Company&#146;s actual results to differ
materially from those in the forward-looking statements include those set forth
under the headings &#147;Business,&#148; &#147;Risk Factors and Certain Factors Affecting
Future Operating Results&#148; and &#147;Management&#146;s Discussion and Analysis of
Financial Condition and Results of Operations&#148; in each of the Company&#146;s Annual
Report on Form 10-K for the year ended December 31, 2003, and its Quarterly
Report on Form 10-Q for the quarter ended March 31, 2004, and Current Reports
on Form 8-K, as well as those described in the Company&#146;s other press releases
and SEC filings.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr height="24" style="height:17.65pt;">
  <td width="155" height="24" valign="bottom" style="height:17.65pt;padding:0in 0in 0in 0in;width:116.05pt;">
  <p align="center" style="color:white;font-weight:bold;line-height:10.5pt;margin:0in 0in 4.0pt;text-align:center;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">Thomson
  StreetEvents</font></b></p>
  </td>
  <td width="228" height="24" valign="bottom" style="height:17.65pt;padding:0in 0in 0in 0in;width:171.0pt;">
  <p align="center" style="color:#003399;line-height:10.5pt;margin:0in 0in 4.0pt;text-align:center;"><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">streetevents@thomson.com</font></p>
  </td>
  <td width="139" height="24" valign="bottom" style="height:17.65pt;padding:0in 0in 0in 0in;width:103.95pt;">
  <p align="center" style="color:#003399;line-height:10.5pt;margin:0in 0in 4.0pt;text-align:center;"><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">617.603.7900</font></p>
  </td>
  <td width="165" height="24" valign="bottom" style="height:17.65pt;padding:0in 0in 0in 0in;width:123.5pt;">
  <p align="center" style="color:#003399;line-height:10.5pt;margin:0in 0in 4.0pt;text-align:center;"><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">www.streetevents.com</font></p>
  </td>
  <td width="35" height="24" style="height:17.65pt;padding:0in 0in 0in 0in;width:26.3pt;">
  <p align="center" style="color:#003399;font-size:1.0pt;line-height:10.5pt;margin:2.0pt 0in;text-align:center;">&nbsp;</p>
  </td>
 </tr>
</table>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#169; 2004 Thomson Financial. Republished with
permission. No part of this publication may be reproduced or transmitted in any
form or by any means without the prior written consent of Thomson Financial.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='1',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="font-family:'Times New Roman';font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:right;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;text-transform:uppercase;">Final Transcript</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman"><font><img width="288" height="27" src="g93401moimage002.jpg"></font>&#160;&#160; </font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-weight:bold;margin:0in 0in .0001pt 9.0pt;page-break-after:auto;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Conference Call
Transcript</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:#003399;font-weight:bold;margin:0in 0in .0001pt 9.0pt;page-break-after:auto;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">ANIK - Q2 2004 Anika Therapeutics Earnings Conference Call</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:#003399;font-weight:bold;margin:0in 0in .0001pt 9.0pt;page-break-after:auto;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">Event
Date/Time: Aug. 06. 2004 / 11:00AM ET</font></b></p>

<p style="font-weight:bold;margin:0in 0in .0001pt;page-break-after:auto;text-indent:9.0pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Event
Duration: N/A</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='2',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:#6B9915;font-weight:bold;letter-spacing:2.0pt;margin:0in 0in .0001pt;text-transform:uppercase;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;letter-spacing:0pt;text-transform:none;">CORPORATE PARTICIPANTS</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-weight:bold;line-height:normal;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood</font></b></p>

<p align="left" style="font-style:italic;line-height:normal;margin:0in 0in .0001pt;text-align:left;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;">Anika
Therapeutics, Inc. - President, CEO</font></i></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-weight:bold;line-height:normal;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight</font></b></p>

<p align="left" style="font-style:italic;line-height:normal;margin:0in 0in .0001pt;text-align:left;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;">Anika
Therapeutics, Inc. - CFO</font></i></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:#6B9915;font-weight:bold;letter-spacing:2.0pt;margin:0in 0in .0001pt;text-transform:uppercase;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;letter-spacing:0pt;text-transform:none;">CONFERENCE CALL PARTICIPANTS</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-weight:bold;line-height:normal;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">William
Plovanic</font></b></p>

<p align="left" style="font-style:italic;line-height:normal;margin:0in 0in .0001pt;text-align:left;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;">First Albany
Capital - Analyst</font></i></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-weight:bold;line-height:normal;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Gibson</font></b></p>

<p align="left" style="font-style:italic;line-height:normal;margin:0in 0in .0001pt;text-align:left;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;">Nollenberger
Capital - Analyst</font></i></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-weight:bold;line-height:normal;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck</font></b></p>

<p align="left" style="font-style:italic;line-height:normal;margin:0in 0in .0001pt;text-align:left;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;">Presidio
Management - Analyst</font></i></p>

<p align="left" style="font-style:italic;line-height:normal;margin:0in 0in .0001pt;text-align:left;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></i></p>

<p align="left" style="font-weight:bold;line-height:normal;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Neil Gore</font></b></p>

<p align="left" style="font-style:italic;line-height:normal;margin:0in 0in .0001pt;text-align:left;"><i><font size="2" face="Times New Roman" style="font-size:10.0pt;">UBS Financial
Services - Analyst</font></i></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:#6B9915;font-weight:bold;letter-spacing:2.0pt;margin:0in 0in .0001pt;text-transform:uppercase;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;letter-spacing:0pt;text-transform:none;">PRESENTATION</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Operator</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">At this time I
would like to welcome everyone to the Anika Therapeutics second quarter
earnings conference call. (OPERATOR INSTRUCTIONS). Dr. Sherwood, you may begin
your conference.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Good morning
everyone and welcome to Anika Therapeutics conference call for the second
quarter of 2004. I&#146;m Charles Sherwood, President and Chief Executive Officer.
And joining me here this morning is our Chief Financial Officer, Bill Knight.
Second quarter results were issued this morning. If you have not received a
copy of the news release, please contact Angeline McCarthy at 310-279-5976.
Results are also posted on our website.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">We will begin
the call as usual with Bill going over the financial results for the quarter in
detail. Afterwards I will review major business and research and development
progress for the second quarter and where we stand on our corporate objectives
for 2004. With that we will now turn to the review of our financial results.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Before the
financial results, I will briefly review Anika&#146;s Safe Harbor statement with
regard to forward-looking statements. Statements made in this call, which are
not statements of historical fact, are forward-looking statements as defined in
the Securities Exchange Act of 1934. Words such as will, believe, plan, expect,
anticipate, currently, forward, seek, continue, target, goals, objectives, on
track, intend , pursue, look, always as well as other expressions which are
predictions or indications of future events or trends, and which do not
constitute historical matters, identify forward-looking statements. These statements
are based upon the current beliefs and expectations of management and are
subject to significant risks and uncertainties.&#160; The Company&#146;s actual results could differ materially from any
anticipated future results, performance or achievements described in the
forward-looking statements as a result of a number of factors, including those
set forth in this morning&#146;s press release, the Company&#146;s SEC filings, and other
press releases.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">With that I&#146;ll
review the second quarter financial results. Total revenue for the second
quarter ended June 30, 2004 grew 89 percent to $6.3 million from $3.3 million
for the corresponding 2003 quarter. As noted in today&#146;s press release, overall
Company sales for the first 6 months are up 85 percent to $12.4 million versus
$6.7 million for the first half of 2003. Product revenue reached $5.7 million
for the second quarter, an increase of 72 percent over the 2003 quarter.</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='3',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Here&#146;s a
breakdown of revenue by product category. OrthoVisc accounted for 49 percent of
total product sales for the second quarter, up approximately 236 percent to
$2.8 million from $831,000 for the second quarter of 2003. Sales for the 2004
second quarter include shipments to our U.S. distributor Ortho Biotech Products
and royalty fees tied to U.S. end-user sales. Sales of OrthoVisc outside the
U.S. were up 61 percent for the quarter.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Ophthalmic
products accounted for 47 percent of total product sales, and rose 22 percent
over the prior year second quarter to near $2.7 million from $2.2 million for
the same period last year. Hyvisc accounted for 4 percent of total product
sales for $206,000 for the quarter. Hyvisc sales for the most recent quarter
declined approximately 23 percent compared with the same quarter last year.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Total revenue
for the second quarter included recognized licensing and milestone revenue
equal to $572,000. As previously disclosed $550,000 of this amount is tied to
upfront and milestone payments received for the licensing supply agreement with
Ortho Biotech.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Gross margins on
product revenue for the second quarter was 57 percent compared with 44 percent
for the same period last year, reflecting the shift in revenue mix, higher unit
volume and manufacturing efficiency gains we have discussed in prior calls.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Total operating
expenses were up 59 percent for the quarter to $2.5 million as compared to the
same quarter last year. Much of this increase is due to the start of clinical
trials for INCERT, our product designed to prevent post surgical adhesions and
our cosmetic tissue augmentation product, or CTA therapy product during the
quarter.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Research and
development expenses for the quarter increased 74 percent quarter over quarter
to $1.1 million, in line with planned expenditures on clinical trials. Overall
research and development costs for the 2004 year-to-date period totaled
approximately $2 million or about 16 percent of Company revenue.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Selling, general
and administrative expenses increased 49 percent to $1.4 million for the second
quarter compared with $945,000 for the second quarter of 2003. This is due to
increases in staffing and other initiatives to build international sales.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">We recorded a
current provision for income taxes of $603,000 for second quarter income, which
is in line with the expected effective tax rate of 42 percent for the remainder
of 2004.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Net income for
the second quarter 2004 equaled $765,000, or 7 cents per diluted share,
compared with a net loss of $81,000 or $0.01 per share for the same period last
year. Year-to-date income is $8.6 million or $0.75 cents per diluted share,
compared with a net loss of $394,000 or $0.04 cents per diluted share for the
first half of 2003. Year-to-date results included a previously disclosed
one-time tax benefit of approximately $7 million recorded in the first quarter
of 2004.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Moving now to
the balance sheet. Cash and cash equivalents and marketable securities at June
30, 2004 totaled $33.5 million. This compares with $34.5 million at March 31,
2004, $14.6 million at December 31, 2003.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Days sales
outstanding, or DSOs, for the quarter averaged 27 days as compared to 49 days
at the end of the first quarter.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Total
inventories stood at $3.7 million at the end of the quarter, a nominal increase
from $3.6 million at March 31, 2004. Inventory turns averaged 2.7 times for the
second quarter compared with 3 times for the first quarter.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">That completes
the financial summary of the second quarter results. I will now turn the call
back to Chuck.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - President,
CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Over the next
few minutes I plan to discuss several key areas: First, our overall financial
performance for the quarter. Next, I will cover the major osteoarthritis
business developments, including domestic and international sales of OrthoVisc.
I will then turn to our ophthalmic business and market developments in that
area. I will follow that with a review of our work toward developing a
sustainable product pipeline, including clinical trials for 2 potential
products, as well as our recently announced agreement with Ortho Neutrogena to
develop and commercialize our cosmetic tissue augmentation, or CTA, therapy.
Finally, I will conclude with our goal for 2004.</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='4',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Let&#146;s begin with
our second quarter financial performance. We recorded another quarter of strong
financial results at Anika - in line with our goal for profitable operating
results for 2004. Much of this revenue growth is attributable to the U.S.
launch of OrthoVisc, but we also saw higher sales of our ophthalmic products.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Let&#146;s first
review sales and other trends in our osteoarthritis business. With sales up 236
percent to $2.8 million versus $831,000 for the prior year&#146;s quarter,
OrthoVisc, as expected, was the main impetus behind overall sales growth this
quarter. Much of this reflects the unit sales to our U.S. distributor, Ortho
Biotech Products, as well as royalties for end-user sales.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">The increase
also reflects strong growth in international sales which were up 61 percent
from $831,000 in Q2 of 2003 to $1.3 million in Q2 of 2004. For those of you who
are new to Anika, OrthoVisc is an injectable therapy for alleviating the pain
associated with osteoarthritis of the knee.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">With regard to
domestic sales, so far we have been pleased with a strong commitment on the
part of Ortho Biotech organization for the OrthoVisc product. Ortho Biotech is
supporting OrthoVisc with a force of approximately 65 dedicated sales reps,
augmented by approximately 170 sales reps from Centocor , another J &amp; J unit
known for its expertise in biopharmaceuticals. Ortho Biotech is focused on
orthopedic surgeons, and the Centocor sales reps are working to build sales
among rheumatologists.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">On an anecdotal
level, through OBI we have heard some very positive messages from early users
and their physicians about the efficacy and safety of the OrthoVisc product.
OrthoVisc has had an impeccable safety record throughout its 8 year commercial
life outside of the United States. We believe that this gives us an important
competitive advantage toward gaining ground in the U.S. market.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">In conjunction
with Ortho Biotech we have been evaluating retreatment results from a recently
concluded clinical trial. In other words, the efficacy of a second round of
OrthoVisc treatments beyond the first 6 months. We have filed these results
with the FDA in June with the aim of obtaining a retreatment claim for the
product. And this is another measure which we would believe will give the
product a distinct competitive advantage.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">On the international
front, we made some positive inroads in recent months. Much of the strength in
international sales in Q2 was due to continued high demand from Turkey. But we
also saw net higher sales on a quarter over quarter basis in Greece and Spain.
And we booked our first sales in Egypt during the quarter and also entered the
market in Kuwait.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">We have received
reimbursement approval in France, and after we work out pricing strategies,
look to begin booking sales there, most likely in the fourth quarter of this year.
Sales are not ramping up as quickly as we would like in Germany. We are working
with our distributor for that market on initiatives to stimulate sales growth.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">In other efforts
to build international OrthoVisc sales, during the second quarter our sales and
marketing team exhibited at 2 major international conferences. In May we and
our distributors participated in the European Society&#146;s Fourth Traumatology,
Knee Surgery and Arthroscopy, known as ESSKA in Athens and in June we
participated in the annual conference in Germany of the European League against
Rheumatism, also known as EULAR. I might point out that this is the first time
Anika has exhibited as a Company outside of the United States.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">In conjunction
with our distributors we are also examining strategies for moving the brand
forward on an international basis. Some of the strategies we are considering
include coordinating new clinical studies performed in local countries to
benefit and support all international distributors of the product.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">We began
shipping room temperature OrthoVisc, the new version that is being sold in the
United States, for our larger international customers during the second
quarter. Shipments of this new product version to smaller international
customers will begin in the third and fourth quarter. All in all, we expect to
continue seeing positive trends in international sales throughout the rest of
the year.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">The other
product in our osteoarthritis line is Hyvisc, a treatment for equine
osteoarthritis, marketed in the United States by Boehringer Ingelheim
Vetmedica. Hyvisc accounted for approximately 4 percent of product sales for
the second quarter which were equal to $206,000, down 23 percent compared to
the second quarter of 2003. Boehringer Ingelheim has communicated that this is
due to market anticipation over the recent introduction of a competing product.
BI&#146;s sales and marketing team has assured us that they are working to counter
this market wavering by refocusing more aggressively on Hyvisc with
advertisements, distributor meetings and other measures.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">I will now turn
to a discussion of our ophthalmic business. With nearly $2.7 million in sales,
this product category accounted for approximately 47 percent of total product
sales for the quarter. For a year-to-date, ophthalmic product sales are up 21
percent to approximately $5.4 &#150; I&#146;m sorry, $5.1 million or 45 percent of total
product revenue. These results aside, it is important to note that this market
in general is experiencing very</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='5',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">modest growth
rate in the range of approximately 4 to 6 percent, a product sales trend in
keeping with our expectations for this mature business line.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Moreover, as I
mentioned on our last conference call, one of our customers, Advanced Medical
Optics, has closed a deal to acquire Pharmacia&#146;s ophthalmic business, and with
it the Healon family of viscoelastic products. Given this development, we&#146;re
expecting ophthalmic product sales of CoEase to AMO to terminate in 2005.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Our overall goal
for this franchise are to maintain our current partner relationships and
support our partners&#146; bids for larger market share. Along those lines we are
working to bolster ophthalmic product sales by introducing new products aimed
at very specific market niches. An example of this is the pH-buffered
viscoelastic designed for enhanced physiological compatibility and longer shelf
life that we began shipping during the second quarter.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">This concludes a
summary of the latest developments in our 2 main product lines. And before
reviewing our research and development program, I would like to mention briefly
that in the operations area we&#146;re moving right along &#151; on the incorporation of
a new packaging vision system on our manufacturing line, and hope to have that
and other process automation installed and validated by year end. We expect
that this system and other improvements being implemented will further decrease
cycle time and in process inventory levels.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">I will now turn
to our research and development programs, a top management priority. We had
several noteworthy developments in this area in recent months. The biggest
development is the agreement we announced two weeks ago with the Ortho
Neutrogena Division of Ortho-McNeil Pharmaceutical, an affiliate of Johnson &amp;
Johnson, for our product for cosmetic tissue augmentation.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">CTA is a therapy
designed to meet the growing demand for soft tissue filler for facial wrinkles,
scar remediation, and lip augmentation. We believe that with the general aging
of the population, coupled with recent therapeutic innovations and other market
forces, we may be at an inflection point where tissue filler procedures will be
taking off.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Market studies
put the U.S. market in 2003 at approximately $60 million, and project that it
will grow to approximately $175 million by 2006. Under the terms of the
exclusive worldwide development and commercialization partnership agreement
with Ortho Neutrogena, we received an initial payment of $1 million to be
recognized as revenue over the term of the contract. In addition, Ortho
Neutrogena will fund the pivotal clinical trial for CTA that we initiated in
May 2004 and fund trials &#151; additional trials necessary to support the
commercialization of the product.&#160; The
agreement also provides for performance and sales-based milestone payments, in
addition to royalty payments and transfer payments for supply of the CTA
product. Those of you who have followed Anika closely know that establishing a
relationship with a premier dermatology company with global marketing and
distribution capability for CTA has been a key Company goal.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">With its
worldwide expertise, it is one of the largest fully integrated pharmaceutical
dermatology groups and its reputation for unsurpassed product quality, we
believe Ortho Neutrogena is an excellent partner to bring CTA into the
expanding aesthetics marketplace. In addition, we believe they are
well-positioned to contribute to the development and advancement of future
potential HA-based CTA products.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">As mentioned
earlier, in early May we started the U.S. Phase III pivotal clinical trial for
CTA. The trial is being conducted by dermatologists and plastic surgeons at up
to 10 centers throughout the U.S., and will involve approximately 200 patients.
Treatments are administered via injection and patients will be monitored for 6
to 12 months following the initial treatment.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">At this stage of
the trial patient enrollment is proceeding well, and to our knowledge, there
have been no serious issues with regard to product safety. I should note that
the expected time frame for U.S. commercialization of this product, of course
assuming the trials and approval process all go according to plan, is early
2006.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">I will now turn
to INCERT, our second therapy currently in clinical trial. INCERT is a family
of bioresorbable, chemically modified hyaluronic acid therapies designed to act
as a barrier to prevent internal tissue adhesion and scarring following spinal,
cardiac, pelvic or abdominal surgery. Such adhesions can lead to recurrent back
pain, female infertility and intestinal blockage, sometimes necessitating
costly second surgeries.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Anika&#146;s family
of potential adhesion prevention products is based on our proprietary modified
HA technology which alters the properties of HA to allow for a longer duration
in the body. By controlling these properties, Anika can design products for
optimal performance in the intended application.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">In late April we
initiated a human pilot clinical trial to test the safety and effectiveness of
INCERT-S for the prevention of internal adhesions or scarring following spinal
surgery. This pilot study is being conducted in 2 centers in the United Kingdom
and will involve approximately 45</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='6',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">patients. It is
being partially subsidized by Surgicraft Limited, a U.K. based medical device
manufacturer and distributor, which has been awarded the marketing rights to
the United Kingdom. Surgicraft is also Anika&#146;s distributor for OrthoVisc in the
United Kingdom. As with the CTA trial, we&#146;re pleased that patient enrollment is
proceeding according to our planned timetable.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">We&#146;re also
currently formulating worldwide strategies for this product category. One
option we&#146;re considering is the possibility of establishing a relationship with
a commercial and developmental partner. We&#146;re still evaluating that route
however. And if we choose to follow it, do not anticipate signing a partner for
INCERT for some time.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">With regards to
other research and development initiatives, most of our R&amp;D staffing and
resources over the past year have been devoted to getting these 2 clinical
trials initiated and supporting their progress. However, the applications for
the HA molecule is a very active area of research in the field right now and
given the breadth and depth of our expertise with HA, we are well-positioned
for assessing and pioneering other novel therapeutic applications.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">We&#146;re also
continuing our focus on chemically modified formulations of HA that leverage
our intensive knowledge and our patented techniques for materials with longer
duration in the body.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">As noted earlier
in my remarks, we have recently introduced several second generation products
to our current commercial product lines and continue to work with Ortho Biotech
to evaluate the potential use of OrthoVisc-like products for osteoarthritis and
other joints in the body, such as shoulder, hip, ankle and digits. This will
likely require separate clinical trials for approval. And under our agreement
with Ortho Biotech, they would fund such trials.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">We have made a
lot of strides in recent months and have been able to check off a number of
goals we had been focusing on for some time. Two of them, launching OrthoVisc
in the U.S. and signing on a CTA marketing and development partner, have pretty
much filled up our corporate planning horizon. As I mentioned in our April
call, we are now in a position to look much further ahead to establish a
long-range strategic plan for Anika&#146;s growth and product line development. We
are, of course, particularly concerned with utilizing the cash on our balance
sheet to obtain the greatest sustainable long-term return for shareholders. I
look forward to reporting back to you in future calls with our progress here.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">We&#146;ll now wrap
up the formal portion of the call with a summary of our corporate goals and
focus for the remainder of 2004. Our primary near-term focus is on:&#160; working to support Ortho Biotech&#146;s
penetration of the U.S. market; increasing international sales of OrthoVisc;
and successfully conducting the 2 ongoing clinical trials.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">As I have
mentioned before, we&#146;ve already accomplished several of our top objectives for
the year. As a reminder, these goals are to :support a successful U.S. launch
for OrthoVisc; commence clinical trials for both the CTA product and INCERT; to
continue achieving topline growth with U.S. OrthoVisc sales as the primary
driver; and to build our internal resources and capabilities to prepare the
Company for the next stage of growth.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">We still have a
lot of work ahead of us, but we are invigorated by our success so far and the
prospects to continue that success into the future. With that, I would like now
to open the call to any questions you may have. Shayla ,we are ready for
questions.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:#6B9915;font-weight:bold;letter-spacing:2.0pt;margin:0in 0in .0001pt;text-transform:uppercase;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;letter-spacing:0pt;text-transform:none;">QUESTION AND ANSWER</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Operator</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">(OPERATOR
INSTRUCTIONS). William Plovanic of First Albany Capital.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">William
Plovanic -<i><font style="font-style:italic;"> First Albany Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Good quarter,
gentlemen. Just a question in regards to your visibility with the OBI contract
into the end-user channel. How much visibility do you have? So basically how
much of the sales in the quarter of domestic OrthoVisc were stocking and how
much is sell-through?</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='7',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">I would say that
it is probably an even split from what we can see.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">William
Plovanic -<i><font style="font-style:italic;"> First Albany Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Do they actually
share the end-user sales numbers with you?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><i><font size="2" face="Times New Roman" style="font-size:10.0pt;font-style:italic;">&nbsp;</font></i></b></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">We see a certain
amount of data, yes.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">William
Plovanic -<i><font style="font-style:italic;"> First Albany Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Would it be fair
to take the trend line off the past couple of quarters and assume that sales
stay at that level or the inventories are such that we could see their sales
potentially dip down before they reaccelerate again?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">I think we have
basically just completed the first quarter of our launch. We had a couple of
three weeks in March, so I would hate to extrapolate a trend out of the first
quarter. I think we would anticipate that this is a product that is going to
continue to gain momentum. The dynamics may change a bit from quarter to
quarter, but we certainly hope to continue to see growth in this area.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">William
Plovanic -<i><font style="font-style:italic;"> First Albany Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">And then on the
tax rate, it was a little high. I guess you gave guidance for 42 percent. That
would be for the full year?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">That is the &#151;
what we would be looking out for quarters 2, 3, and 4 as we currently analyze
our tax situation. That is certainly is subject to change as we work &#151; look at
tax strategies. But certainly for quarters 2, 3, and 4 a good place to start.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">William
Plovanic -<i><font style="font-style:italic;"> First Albany Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Was there
anything special in the quarter in terms of gross margins that would help out
significantly that did boost it in the quarter?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -
Anika Therapeutics, Inc. - CFO</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">No. Product
revenues &#151; margins are certainly reflective of the U.S. OrthoVisc business
which do have higher margins over our other products. But we continue to have
good productivity improvements in the factory as unit volumes continue to
increase. So there is &#151; this is a momentum that we expect to be able to
(technical difficulty).</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">(indiscernible)
as with any business as you more fully utilize your resources in manufacturing
you eat up overhead and you just become more efficient. So it is partially that
as unit volumes go up we have a much more efficient manufacturing operation.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">William Plovanic
- -<i><font style="font-style:italic;"> First Albany Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Are you still
working at one shift right now?</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='8',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Yes. Now
primarily. We do occasionally have, on a sporadic basis, to meet the shipment
demand go into a second shift, but the norm is one shift.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">William
Plovanic -<i><font style="font-style:italic;"> First Albany Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Then just
lastly, and then I will jump back into queue. Competition in the equine market,
does the competitor&#146;s product differ significantly from yours? Do they have
some sort of clinical benefit or ease of use?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">I don&#146;t think
so. Boehringer Ingelheim has told us that the Hyvisc sales decrease was due to
this initial uptake of this newly launched product. They have told us, however,
that field reports affirm that there are slow reorders on this product, due
both to its pricing and its convenience of use.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">As Chuck said
earlier, Boehringer Ingelheim is actively countering this launch with a series
of new ads and promotions, communications that highlight the superiority of
Hyvisc. And we have been very successful with this in the past, so I think
there was initial &#151; some customers were initially looking at any new product
that comes out. But when the rubber hits the road I think Hyvisc will continue
to sail.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Operator</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Bill Gibson
Nollenberger Capital.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Gibson -<i><font style="font-style:italic;"> Nollenberger Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">I want to zero
in on gross margins as well. What it sounds like is you think you can maintain
these margins or improve slightly.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Yes.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Gibson -<i><font style="font-style:italic;"> Nollenberger Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">And how from an
accounting point of view &#151; and did I hear you correctly on Surgicraft that it is
going to pay for part of the INCERT trial?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Yes.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Gibson -<i><font style="font-style:italic;"> Nollenberger Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">And then with
J&amp;J paying on CTA, how does that work from an accounting point of view?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">The revenue
timing of that would be reflected as revenue, not as an offset against expense.</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='9',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Gibson -<i><font style="font-style:italic;"> Nollenberger Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">So that would be
essentially an offset to gross margin. In other words, I assume they&#146;re not
going to let you make the same kind of margins on R&amp;D spending?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Right.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Gibson -<i><font style="font-style:italic;"> Nollenberger Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">And it sounds
like &#151; the question was asked that you do get to see sell-through because
they&#146;re paying you a royalty on the end product sell-through, is that correct?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">That&#146;s correct.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Gibson -<i><font style="font-style:italic;"> Nollenberger Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">And so basically
the trend would be that as quarters go on and the stock gets momentum that
OrthoVisc sales ought to increase each quarter?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">That would be
correct. Both we ship product to them and they continue to gain market share
and traction with their end-user sales.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Gibson -<i><font style="font-style:italic;"> Nollenberger Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Good. And then
just one last question. On the other clinical for orthopedic applications for
other joints, is there sort of a timing when that starts? And have you selected
&#151; Hips is the second-largest, I believe, is that the logical candidate?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">We&#146;re actively
talking about that now with OBI. I&#146;m not sure that I would be willing to say
that if it is the next logical target. Our competitor, Genzyme, is in the midst
of a hip trial now. Certainly hip replacements are maybe second to knee
replacements that it may very well be that targeting another joint might be
more financially beneficial to us. We are also exploring other avenues, other
surgical procedures and things of that nature. So it is not totally wide-open
at this point, but we&#146;re really looking at several things.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Gibson -<i><font style="font-style:italic;"> Nollenberger Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">I&#146;m not quite
sure what exploring other surgical procedures, is it still &#151;?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">These products
may have some application &#151; post arthroscopy procedures. So I&#146;m not saying that
is where we&#146;re going to go, because we haven&#146;t decided where we&#146;re going to go.
But I was mostly countering your inquiry about hip as the next logical place to
go. I&#146;m not sure I concur with that at this point.</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='10',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Gibson -<i><font style="font-style:italic;"> Nollenberger Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Understood. And
do you have a sense &#151; is the market growing this year? In other words I think
historically you had a 14, 15 percent growth rate in orthopedic. Is that still
on track?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">I think that is
what we&#146;re seeing and anticipating, yes. Certainly the patient population
continues to grow at a pretty healthy clip, and the indications of
osteoarthritis continue to grow. So the market dynamic has not changed at all.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Operator</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Rob Lunbeck of
Presidio Management.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck -<i><font style="font-style:italic;"> Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">A couple of
questions to follow on some of the earlier questions. With respect to your
domestic OrthoVisc sales for this third quarter we&#146;re now in, would you
anticipate that the stocking of the channel is essentially complete, and those
sales should be largely going to end-users? Or do you think there is continued
stocking as a component of third quarter sales?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">We would expect
that as they expand their user base that &#151; you know, they are both the stocking
component and an end-user sale. Again we have only really just completed the
first quarter, so I don&#146;t think the growth dynamics are going to be
significantly different in the next quarter, maybe 2 quarters. I think that is
how we&#146;re looking at it.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck -<i><font style="font-style:italic;"> Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">When you say
growth dynamics are you referring to &#151;? Go ahead because you might be
(indiscernible) of it.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">It is more on a
&#151; what stocking, what is end-user. If you don&#146;t finish the first quarter and
you are complete with your stocking &#151;.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck -<i><font style="font-style:italic;"> Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Maybe you could
just help me with the math here. If my math is right, you sold about $1.45 million
in the quarter just completed to J&amp;J, up from about $1.3 in the first
quarter. Does that sound about right?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Yes, as the
numbers are certainly in the ball park, but again we view that has not 2
separate distinct quarters. Again there was the launch in mid-March. We really
view that period and this quarters ending as really kind of a launch quarter.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck -<i><font style="font-style:italic;"> Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Then to follow
that, would it be reasonable to think that Q3 sales to J&amp;J might equal the
sum total of Q1 and Q2 or more? Are we going to see a sequential acceleration,
as it were?</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='11',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">I don&#146;t know
that I want to project yet what their revenue will be because we are in this
launch phase. As Chuck said earlier, they are out aggressively. They have got
good promotional programs. They&#146;ve got a sales force a little more seasoned now
on the products. They&#146;ve got good incentive programs in place. So we certainly
anticipate them doing well in this area. But whether it has really gained
traction this coming quarter or the next quarter, I don&#146;t want to quite predict
that.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">You know, it
might be useful for me to add a little color here on the product. We received &#151;
first of all, let me say a couple of things up front. I&#146;m very pleased with our
relationship with Ortho Biotech. I think that they&#146;ve done a fantastic job so
far. But we received final labeling in February from the FDA. We made a
commitment that we would launch the product at the annual meeting of the
American Academy of Orthopedic Surgeons, and that meeting happened to occur in
March.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">So OBI did a
fantastic job of putting a booth together and having a presence at that
meeting. If that meeting were in May, we probably would have launched &#151; or
June, we probably would have launched the product in May or June. So we really
rushed to get into that meeting. And quite honestly, when you define launch,
well we technically launched at that meeting, but all of the elements of a
classical launch weren&#146;t necessarily in place at that point.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">We also got out
into the marketplace and people knew OrthoVisc was coming, and you might imagine
there were some discounting by our competitors and some other reactions to the
introduction of OrthoVisc. I wouldn&#146;t say that many of the customers out there
were just waiting for the rest to come into the office so they could buy a
large amount of OrthoVisc. So it met with a little resistance.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Also, another
issue that OBI has had to deal with has been &#151; certainly this occurred when
Hyalgan and Synvisc were launched was the whole issue of reimbursement. And
we&#146;re told that way back when those products came out a lot of physicians got
burned in the reimbursement area.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">You remember in
previous calls I talked about all the work that OBI did to set up our separate
website called OrthoViscline.com to help the physicians in reimbursement, and
working through that whole process. And they&#146;ve spent a huge amount of time in
that area as a service to help sell the product.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">So there&#146;s been
a lot of activity. I would say that we&#146;re starting to hit our stride. But as
Bill has tried to allude to here, the launch in March was indeed a launch, but
we&#146;re kind of in the old parlance of Total Quality Management, we&#146;re trying to
fix the bicycle as we&#146;re riding it at the same time.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck<i><font style="font-style:italic;"> - Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Right. Right.
Okay. If I could ask just a couple of other quick ones here. What is your
estimate of the U.S.-served market now for HA for orthopedic applications?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">I think we&#146;re
looking at $330 to $350 million. It could be a little better, but still in that
range.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck<i><font style="font-style:italic;"> - Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">That&#146;s growing
at the 14 to 15 percent?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Yes.</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">12</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='12',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck<i><font style="font-style:italic;"> - Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">And then one
other thing &#151;.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">That is for knee
of course, right?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">That is
primarily knee. Knee, I think we think accounts for about 60 percent of the
occurrence of disease, so currently opportunities to keep that rate growing
possibly.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck<i><font style="font-style:italic;"> - Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">And another
question. I may be missing something here, but if I look at Hyvisc from Q1 to
Q2 sequentially, it seems like it &#151; Q1 was either anomalously high or Q2 was
anomalously low. Is there something unusual about the Q1 sales where it was
something like 16 percent of your sales rather than the 4 percent in this
quarter?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">You have to look
at the percent. Again, we did not have (technical difficulty) a little better
U.S. sales, a little better ophthalmic sales this quarter than the first
quarter, plus the product launch that the competitors had in the second
quarter.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">And I think we
do believe there is a bit of seasonality in this first quarter results for
Hyvisc. At the beginning of the new year, racing season, Spring on the way that
they are getting products into their distribution channels.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck<i><font style="font-style:italic;"> - Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">I was just
perplexed.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Let me put this
business a little bit in perspective. If you look, I believe this is second &#151;
if you look 2002 to 2003, they had a pretty big jump up in Hyvisc revenue, is that
correct, Bill?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Yes.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Yes. 2004 it is
somewhat difficult to predict. But give or take, one would expect that would be
at least in the ball park of the 2003 results, and quite a bit up from 2002.
Qualitatively we made some strides in getting additional product acceptance in
the 2002 to 2003. And we&#146;re holding on, I guess, to our share.</font></b></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">&nbsp;</font></b></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">With respect to
the revenue component of our total business, as Hyvisc is relatively flat, its
percentage of the our total revenues is of course is going to go down as
OrthoVisc grows, as will the revenues from our ophthalmic business on a
percentage basis.</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='13',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck<i><font style="font-style:italic;"> - Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Right. No, I may
have been &#151; I may have read this wrong, but it looked like in the Q for the
first quarter it was something like 16 percent of your product revenue, which
would put it close to $1 million in the first quarter and a couple of hundred
thousand in the second quarter. Is that a normal seasonal pattern?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">I think you&#146;re
right on your numbers. And if you look at a quarter&#146;s history over the last
couple of years, it is not a steady linear line, Some quarters are heavier than
others. So to look at a 2 quarters span you are probably not going to get
really valid information. Certainly a year to year span is probably more
appropriate.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Operator</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">William Plovanic
of First Albany Capital.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">William
Plovanic<i><font style="font-style:italic;"> - First Albany Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Just a couple of
follow-ups. First of all, your cash I noticed was actually down sequentially.
And I was wondering what were the uses of cash that did cause that?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">We had a &#151; in
the second quarter probably the large &#151; largest payment, we paid $4.1 million
tax payments for both federal and state. Had we not paid that, obviously we
would have shown significant cash improvement, but that is basically the lion&#146;s
share &#151; more than the lion&#146;s share of the decrease.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">William
Plovanic<i><font style="font-style:italic;"> - First Albany Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Okay, and then
just a housekeeping question. What was D&amp;A in the quarter? And what do you
expect D&amp;A and CapEx to be this year?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">D&amp;A for the
quarter was a little over $170,000, $337,000 year-to-date. So that is a number
that you can probably extrapolate out for the year. As far as capital
equipment, again, we are not a capital intensive business. We spent about
$80,000 on the quarter for computer and operational items. That&#146;ll probably
pick up a bit second half of the year as we look at bringing some items online
in the factory. But this is not a business that requires significant capital
investment.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">William
Plovanic<i><font style="font-style:italic;"> - First Albany Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">And then a
little clarity on the PMA &#151; the PMA that you&#146;re filing &#151; filed for the
retreatment claim. It is that a PMA-S or what type of filing was that?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">It is a
supplement to the PMA.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">William
Plovanic<i><font style="font-style:italic;"> - First Albany Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">It was a PMA-S.</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">14</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='14',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Yes.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">William
Plovanic<i><font style="font-style:italic;"> - First Albany Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">And at this time
I don&#146;t believe, but just correct me if I am wrong, I don&#146;t believe any of your
competitors have that, do they?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Yes, they do. I
think the real value of this &#151; I don&#146;t want to say too much about the
applications because it is not approved yet, but we needed to demonstrate
certainly the safety of a re-treatment. And there have been some &#151; there have
been some articles published in various journals that address potential safety
concerns with the retreatment of one of the major products in this product
category.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">And so we
believe since the safety of our product in the retreatment trial looked
essentially the same as the first time out that this will be a positive
statement for our product. Obviously, a single course of therapy &#151; since
typically patients get multiple courses of therapy &#151; isn&#146;t very useful. So this
was necessary for us to get to really have a competitive product.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">William
Plovanic<i><font style="font-style:italic;"> - First Albany Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Which one of
your competitors, if you can help me out, does have that retreatment claim?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">I think they all
do.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">William
Plovanic<i><font style="font-style:italic;"> - First Albany Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Including
Synvisc?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Synvisc has a
retreatment claim. That is the product I was referring to where there may be
some issues.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">William
Plovanic<i><font style="font-style:italic;"> - First Albany Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">And then looking
at your international sales of OrthoVisc in the quarter that was a very large
quarter, up sequentially year over year any way you slice it up. How much of
that was stocking and how much of that is sustainable business? And I
understand that you do your stocking distributors, but how many of that is
abnormally large first-time orders, just to get the inventories built and how
much of it do you think is sell-through?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">I would say the
vast majority of that business increase was due to existing customers. Folks
that have really been able to expand their market shares. So I don&#146;t know if it
will be sustainable at that 61 percent base, but that is not new business. It
is an existing &#151; primarily in existing territories.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">William
Plovanic<i><font style="font-style:italic;"> - First Albany Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Is that a
function of the room temperature product being introduced internationally, do
you think?</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">15</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='15',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. - President,
CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">That may
contribute. As I told you, or as I mentioned in my portion of the talk, we&#146;re
really trying to put some emphasis on our international business, so for the
first time we had exhibits at some major medical conferences. We might have
gotten a little bit of bounce from the fact that we got FDA approval. We did
some other things with product monograph and product positioning. So it is a
whole collection of things.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">We also have
enhanced the cooperative nature of our collection of distributors so we meet on
a regular basis now and exchange information across company &#151; country
boundaries. I wouldn&#146;t say that it was any one thing. It has just been a focus
of ours to try to beef that up. Also I would say, just to augment what Bill
said, the increase is very little stocking. It is virtually all sell-through.
And a good portion of that increase is coming from our partner in Turkey.
They&#146;re doing a great job this year.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">William
Plovanic<i><font style="font-style:italic;"> - First Albany Capital - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Actually that &#151;
last question. With the roll out of the room temperature product, is there any
potential for challenges with the inventory of the old product as you have to
whittle those down. Are there any write-offs that would be needed, considering
this changeover and now how quickly you have seen it go?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">None. Zero.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Operator</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Neil Gore of UBS
Financial Services.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Neil Gore<i><font style="font-style:italic;"> - UBS Financial Services - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Great quarter.
Just a couple of questions. The $1 million you got for the CTA product, you
said that the term of the contract that you&#146;re going to amortize that. How long
is that contract for?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">10 years.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Neil Gore<i><font style="font-style:italic;"> - UBS Financial Services - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">And on the
contract for OrthoVisc, you said at the annual meeting that you thought you
would get 2 more milestone payments this year, a third party reimbursement, and
for the update of the manufacturing facility. How is that coming along?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood<i><font style="font-style:italic;"> - Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Let me &#151; I don&#146;t
believe I said precisely that. So let me repeat what I think I said. First of
all, there was a manufacturing improvement milestone payment. And I think we
are making good progress on that. And that still looks very promising. We filed
&#151; actually OBI filed with our help a reimbursement application in March. That
may or may not finalize prior to the end of year. But I hope that it is. But if
not, it will be shortly after the end of the year. So I think we are making great
progress there also. So we will see when we get the money.</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">16</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='16',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Operator</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Rob Lunbeck of
Presidio Management.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck<i><font style="font-style:italic;"> - Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Just a couple of
follow-ons. I think you mentioned a reimbursement as being something of a
hurdle in the launch of the OrthoVisc domestically. And I wondered if you could
just elaborate a bit &#151; describe what are the challenges there, what is the
situation, what remains to be done?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Well, it is a
pretty complex area. Let me talk about what the future is going to hold.
Ultimately there are private payers and there and are Medicare and Medicaid.
And typically the private payers follow the lead of the Medicare Medicaid. And
so the application that we submitted in March was intended to establish what is
called a J code for our OrthoVisc product, or OBI&#146;s OrthoVisc product.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">The product
right now is being reimbursed. It is under a temporary J code. And it is taking
a lot of effort in the doctor&#146;s office and with &#151; sometimes with the assistance
of OBI reps to get that reimbursement payment. Once the official J code is
issued, it will be a lot easier.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">There has been a
guidance document that has come out very recently. I&#146;m surprised no one has
actually seen that or asked about that. But it is got issued about a week ago.
It is out there for review. OrthoVisc is included in there. We are actually
included in that document with Supartz and Hyalgan which are 5 shot treatments.
And we are 3 shot treatments, so there needs to be further discussion with CMS
to refine. And we believe that &#151; and we&#146;re working very diligently to get a
unique J code for OrthoVisc with appropriate pricing.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck -<i><font style="font-style:italic;"> Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Are you
indicating that price &#151; they price on a bundle basis, since you&#146;re getting sort
of 1/5 instead of 1/3 for treatment of what you ought to be getting?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Right now the way
they&#146;ve got us lumped on &#151; preliminarily we&#146;re lumped with the 5 shot regimen.
So if we are a 3 shot regimen it just doesn&#146;t make a lot of sense for
treatment. Synvisc has their own distinct code. So in our application we have
of course filed for our own distinct code as well.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck -<i><font style="font-style:italic;"> Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Are these codes
national or are they regional?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">National, I
believe.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck -<i><font style="font-style:italic;"> Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">And what is that
reimbursement level approximately under the temporary J code?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Under the
temporary code?</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">17</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='17',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck -<i><font style="font-style:italic;"> Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Yes.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">For 2004?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck -<i><font style="font-style:italic;"> Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Sure.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Pretty high. I
think it was 90 something percent of the average wholesale price.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">95 percent of
AWP at the moment.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck -<i><font style="font-style:italic;"> Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">What is the
outlook for next year? Should that go down by a formula?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">It always goes
down as &#151; we are not sure what it will go down to. But the reimbursement level
right now for OrthoVisc is, I believe, much higher than any of the other
products, because it is a new product. And so it will go down, but hopefully it
is to a level that make some sense. And we believe a level that is commensurate
with the reimbursement for the Synvisc product, or maybe even slightly higher.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck -<i><font style="font-style:italic;"> Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Is it subject to
the ASP plus 6% sort of reimbursement strategy that is being introduced for
Medicare for 2005?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">It&#146;s part of
that, yes. And they just issued the first in a series with maybe a series of
guidance proposals. So everybody is processing those now and reviewing those.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck -<i><font style="font-style:italic;"> Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Do you have what
the AWP is currently?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">I don&#146;t have it.
No, not at my fingertips.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck -<i><font style="font-style:italic;"> Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Approximately
perhaps?</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">18</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='18',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">It is &#151; we know
Synvisc is in the $560 range. And I do know that we are higher than that.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck -<i><font style="font-style:italic;"> Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">And that&#146;s for
multiple injections, is that correct?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">$560 is the
treatment price, a 3 shot treatment price. We&#146;re being currently reimbursed at
a rate higher than that. And I believe 2 parts in Hylagan are more in the $550
range for their 5 shot regimen.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck -<i><font style="font-style:italic;"> Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Any indication
as to what amount of the business is private pay or commercial pay versus
Medicare, Medicaid? And what does the reimbursement look like there?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">We don&#146;t have
data on that yet. And I don&#146;t know that I would quite trust it yet to be able
to extrapolate that out.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck -<i><font style="font-style:italic;"> Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">One other
question, if you look forward, say, a year, a year and a half from now exiting
2005, what do you think would be a satisfactory market share of the end-user
market for J&amp;J to have in this product? Where would you expect to&#151;like
to&#151;see that number?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Exiting 2005?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck -<i><font style="font-style:italic;"> Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Yes.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">After a full
year and a half of sales?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck -<i><font style="font-style:italic;"> Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Yes.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Bill Knight -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. - CFO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">I don&#146;t know
where we&#146;re going to go. But if I &#151; we are not at least double digits, I think,
we would be disappointed.</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">19</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='19',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck -<i><font style="font-style:italic;"> Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">And then over
the longer-term? Would you expect that to continue to trend higher?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">All I can tell
you is on the part of when we entered into this agreement with OrthoBiotech, I
think they were looking at this being one of the top 2, or at worst 3 products
in the marketplace. And so I think their expectations are at least that, or to
approach market leadership, which may be a tough hurdle given how entrenched
the Synvisc product is. But I don&#146;t think they are going to be very happy
ending up being fourth or fifth in the marketplace.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">So it is hard to
make projections because some of this depends on reimbursement, but also the
market dynamics are changing. And there has been a little bit of shift in the
marketplace. So to give you an actual number, I think we need a little more
history.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Rob Lunbeck -<i><font style="font-style:italic;"> Presidio Management - Analyst</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Not to belabor
this, but could you just mention what these shifts are in the marketplace that
you are seeing?</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">One of the
shifts I believe, and we will see if it is a continuing trend, I think the
Synvisc sales have tended to flatten out or maybe go down a little bit and
other competitors are gaining slightly.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Part of that &#151; I
don&#146;t know what the factors are contributing to that. It could be this whole
potential issue that is with regard to retreatment that has been written about
in some of the medical articles. It could be other factors as well. I really
don&#146;t &#151; I am not 100 percent sure what is going on there. I would suspect that
the dominance of the market by Synvisc at 80 plus percent for sometime early on
is not going to continue.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Operator</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">At this time
there are no further questions.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Charles
Sherwood -<i><font style="font-style:italic;"> Anika Therapeutics, Inc. -
President, CEO</font></i></font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Terrific. I
would like to thank you all for joining us on today&#146;s call. And as always, we
appreciate your interest in Anika and look forward to reporting to you on our
progress in future conference calls. Goodbye.</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="border:none;font-weight:bold;line-height:normal;margin:0in 0in .0001pt;padding:0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Operator</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="color:#003399;font-variant:small-caps;font-weight:bold;margin:0in 0in .0001pt;text-align:left;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;font-variant:normal;font-weight:normal;">Thank you. This
concludes today&#146;s conference call. You may now disconnect.</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">20</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='20',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:#6B9915;font-weight:bold;letter-spacing:2.0pt;margin:0in 0in .0001pt;text-transform:uppercase;"><b><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;letter-spacing:0pt;text-transform:none;">DISCLAIMER</font></b></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:gray;margin:0in 0in .0001pt;text-align:justify;"><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">Thomson Financial reserves the right to make changes to
documents, content, or other information on this web site without obligation to
notify any person of such changes.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:gray;margin:0in 0in .0001pt;text-align:justify;"><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">In the conference calls upon which Event Transcripts
are based, companies may make projections or other forward-looking statements
regarding a variety of items. Such forward-looking statements are based upon
current expectations and involve risks and uncertainties. Actual results may
differ materially from those stated in any forward-looking statement based on a
number of important factors and risks, which are more specifically identified
in the companies&#146; most recent SEC filings. Although the companies may indicate
and believe that the assumptions underlying the forward-looking statements are
reasonable, any of the assumptions could prove inaccurate or incorrect and,
therefore, there can be no assurance that the results contemplated in the
forward-looking statements will be realized.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:gray;margin:0in 0in .0001pt;text-align:justify;"><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">THE INFORMATION CONTAINED IN EVENT TRANSCRIPTS IS A
TEXTUAL REPRESENTATION OF THE APPLICABLE COMPANY&#146;S CONFERENCE CALL AND WHILE
EFFORTS ARE MADE TO PROVIDE AN ACCURATE TRANSCRIPTION, THERE MAY BE MATERIAL ERRORS,
OMISSIONS, OR INACCURACIES IN THE REPORTING OF THE SUBSTANCE OF THE CONFERENCE
CALLS. IN NO WAY DOES THOMSON FINANCIAL OR THE APPLICABLE COMPANY OR THE
APPLICABLE COMPANY ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER
DECISIONS MADE BASED UPON THE INFORMATION PROVIDED ON THIS WEB SITE OR IN ANY
EVENT TRANSCRIPT. USERS ARE ADVISED TO REVIEW THE APPLICABLE COMPANY&#146;S
CONFERENCE CALL ITSELF AND THE APPLICABLE COMPANY&#146;S SEC FILINGS BEFORE MAKING
ANY INVESTMENT OR OTHER DECISIONS.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="color:gray;margin:0in 0in .0001pt;text-align:justify;"><font size="2" color="black" face="Times New Roman" style="color:windowtext;font-size:10.0pt;">&#169; 2004, Thomson StreetEvents All Rights Reserved.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">21</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

</div>


<!-- SEQ.=1,FOLIO='21',FILE='C:\jms\ssounda\04-9340-1\task167296\9340-1-mo.htm',USER='ssoundarrajan',CD='Aug 11 13:35 2004' -->
</body>

</html>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>GRAPHIC
<SEQUENCE>4
<FILENAME>g93401mmimage002.jpg
<DESCRIPTION>GRAPHIC
<TEXT>
begin 644 g93401mmimage002.jpg
M_]C_X``02D9)1@`!`0$`8`!@``#__@`<4V]F='=A<F4Z($UI8W)O<V]F="!/
M9F9I8V7_VP!#``H'!P@'!@H("`@+"@H+#A@0#@T-#AT5%A$8(Q\E)"(?(B$F
M*S<O)BDT*2$B,$$Q-#D[/CX^)2Y$24,\2#<]/CO_VP!#`0H+"PX-#AP0$!P[
M*"(H.SL[.SL[.SL[.SL[.SL[.SL[.SL[.SL[.SL[.SL[.SL[.SL[.SL[.SL[
M.SL[.SL[.SO_P``1"``Z`)T#`2(``A$!`Q$!_\0`&P```@,!`0$`````````
M``````$$!08'`@/_Q``T$``!`P,"!0(#!P0#```````!`@,$``41!B$2$S%!
M43)A%")Q!Q5"<I&AP18S@=$C8H+_Q``9`0$``P$!`````````````````0,$
M!0+_Q``B$0`#``("`@(#`0```````````0(#$00Q$B$B01,C,E'_W0`$`"C_
MV@`,`P$``A$#$0`_`.S4444`444J`=*C-1ITYF!'+SN3V2A(RI9[`#N:+WZ`
MKC<8MKAKES'4M--C))/7V'O7)]2Z[GWE:F(:UQ8?3"3A2_J?XJ/K2ZW:==RU
M<FC&0@<3<<JSP@]"<;9K.X.<`9)Z5UN/QIE*J]LYN?.Z?C)U'[*DN_=$Q2RH
MMF1\H)[XWK>51Z0MGW1IR+'4,.%/&OZG>KO-<[-7ED;-V*7,),=%*G518%%%
M%`%%%%`%%%%`%%%%`%%*B@'2J!*O,*'<(T!YT!^42&T9\#K46^:GM]B;'/<X
MWU;(81NM1^E>E-/I'EW*^RRERV8;)<=.!T`'51\#WJ/'C+<<$R6!S3Z$=FAX
M^ODU!L\.;-6FZW<<#RA_P1AZ6$_RH^:]:MNWW-IV3)2K#JD\MK\QVKTI^7BN
MR/+UY,Y+JJY"Z:CF24GY`OEHQX3M3TG;Q<]30HRAQ(YG&L>R=ZI]^]6^E[PB
MPWUJ>ZVIQM*5)4E/7!%=RI<XVI_PY$TG>V=T&$CVJ`;DF3,5#AGF+;_O+'1O
MVSY]JQO]5W75\[[ML;2H;'5Z0=U)3_%;:UVR/:82(L9.$IW*CN5GN2>Y-<2L
M;C^NSK3?G_/1,2,#&<TZ0HS518.BE10#HI44`Z*5&:`=%*B@#H,U2ZEU)%T[
M;RZZ0M]8PRR#NL_ZI:DU/#TY"+KRN-Y0PTRD[J/\"N-W:ZR[S.7,F.<;BC@#
MLD>!6OC<9Y'NNC-GS*%I=GBXW&5=)ZYLEPK><.<@^GP![5HX%I>L<)F[S4$S
M9)/PZ7!GE@?B.>^^U6NAM$J6I%VNC1"1NPPH=?\`LK_5:_4MB-Z@H0VH(>9/
M$V3T^E7<G.E^O&9\>&G+M]F'B:ENL20'C+<=&<J0M6017G[1[V)[T&&T?D#0
M?4/=0V_:IT71=T<D!,E*&&4GYU\0.WM6'O$H3+Q*>1_;+A2W^1.R?V`JKA1O
M)M_1XR5<QI_9"J=9K-+OEP1#B-DDG*EGHA/DT[-99M]G)BPV\Y]:SZ4#R379
M]/:?B:?@"/'3Q+.[CAZK-;^1R%B6EV><&%V]OH]6&QQ;!;DQ(R=^KBR-UJ\F
MJ^\ZTAV>ZH@K96Z`$E]U'I8!.!FK6]7'[JM3TL-+=4A/RH0G)4KM6(A::U,[
M;9?,;MZC<SS'B^5<8R-AMXKF8Y5-U;-]MRO&$=#;<2X@+0H%*AD$'.15#=M8
MP;+?&;;-2IM#J`KG_A3DXWJ'HF7.C-.V&YM+#\$X0Y@E*T=L'VKXW2VHN'V@
MM-RHQ=C+@J2HJ2>'.?/FHG',VU70JZ<ISV:&[WEJUV-ZZI'/;:2%`(/J!(&Q
M_P`U+BR1)AM20GA#B`O'C(S7.M0V*]6"URX4!2YMIDC!;.2MC?.WM6_MB2FS
MQ4J!!#"<@CVJ+B9E-/>R9NG331$L&H$7Y,M2&%-?#/EHY.>+'>E-U$W"U%%L
MZV23(:+G-X@`D#/7]*J/L_9=:9NW-:6WQ35$<22,CVJ#J^S+O6M8$8EYMI<1
M25/-@X2<JZFO:QQ^1I]$.[\$UV7B=6HF70P;1#<G\!PZ^@@-M_\`KO\`XK0@
MG&>]8>SSYVD5MV>ZP.*+T9F16R4G\P'>KS4UW>@64J@-+>E2<-L!"2<$]SXK
MQ<?)*29I^+=$9S7$)O4`M9:7RN9R3*_`',>FM,.E<X.C]2&P&UE-N*"OF\SB
M5S./.<Y\UIM(W:1-M/)N#3C4N(KE.<:2.+'0CS7K)CE+<,C'=;U1Q^=-EW>X
M+D/J6\\ZK"1U(\`"M[HW0):4BY7EL<8^9J.?P^ZO?VI:$BQSJ*Z*+#94V\H(
M/`,IW/3Q71>XK5RLU3^N?2,_'Q*OG0@,#`&*=.BN:;SX3$+<A/-M^M3:@GZX
MVKD-KT!>[A,Y<EDQ&4JPMU?4CV'>NR45?BSUB3\?LIR8IR-;*ZS62%8X28L-
MOA`]2CZEGR:L:=%4MMO;+4DEI$2>EY457(6I+@&1P@'/ZU\GOCFDL)8X7#OS
M"YMVVZ"I]%0->]E4^Y<!;F%I!2^2.9PIZ#]#7N49JH\?X4J*U'YU*`!QCOMM
M5E10C15N/7$6UD(:XY2_6<#"<=:]2E3W4Q_A1RBL$N!6-MMAT/>K*B@T5<U4
M]EN,EM7S9/.4A/M]#7VD/NLAA:4K6DI(60C)SC;]ZG44&BN>3-<A1U)<6AT\
M(<`2._7K4@<T2D(ZMALY)'552:*$Z*V"Y)6\4OET*WXDE`"4[[8-0WI5T:?6
3&FG7P5'TH`X1VZBKZG0ASL__V3\_
`
end

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>GRAPHIC
<SEQUENCE>5
<FILENAME>g93401moimage002.jpg
<DESCRIPTION>GRAPHIC
<TEXT>
begin 644 g93401moimage002.jpg
M_]C_X``02D9)1@`!`0$`8`!@``#__@`<4V]F='=A<F4Z($UI8W)O<V]F="!/
M9F9I8V7_VP!#``H'!P@'!@H("`@+"@H+#A@0#@T-#AT5%A$8(Q\E)"(?(B$F
M*S<O)BDT*2$B,$$Q-#D[/CX^)2Y$24,\2#<]/CO_VP!#`0H+"PX-#AP0$!P[
M*"(H.SL[.SL[.SL[.SL[.SL[.SL[.SL[.SL[.SL[.SL[.SL[.SL[.SL[.SL[
M.SL[.SL[.SO_P``1"``;`2`#`2(``A$!`Q$!_\0`&P`!``(#`0$`````````
M````!@`%`@0'`0/_Q``_$``!`P,#`@,%!00(!P`````!`@,$``41!A(A!S$3
M05$4(F%Q@14R-W.1(S92H18D,W*QLL+#0E-TA+/1X?_$`!H!``,!`0$!````
M``````````$"`P`$!0;_Q``K$0`"`@$"!0,$`@,````````!`@`1`Q(A!!,Q
M05$487%RD:&Q(H%"T?#_W0`$`"C_V@`,`P$``A$#$0`_`#+6C-2O-(=;LTI2
M%I"DJ"."#V-82M):@@Q7)4JTR666AN6M:<!(IOTSU7>[IJ%NV3)I=B-Q5;6_
M#2,;<`<@9JEUUJR^.WF[65<XF`'RCP=B1[H((&<9\O6OHURYSEY9`\]^D\LI
MCT:MY0S=+W6WV*/>I3*$1)*DAH^("5;@2#@=N!YU45V:59XMZZ7V1B=<FK=&
M:0TZX^YCL$*&!DCDYH7K#0T:PVB+>+;<O;84A01D@9Y!((([C@UL/%!CI;K9
M$SX2!8Z0;4IO:=`1?L%J]:BNZ;9&D8\%.S*E`]B?F.<8[57ZLT6]IAV,\)29
M5OE?V4E"?K@C/IR.>:L.(QLVD'>(<;`74,5*Z8_TJMENDL-W'4S;(?`0VDH"
M5..9[`$]NWZU@CI5!C7'V.YZC9:6^K$1I"0''1ZD$_3`S\ZGZS#Y_!C<A_$Y
MM4I)*T7,:UK_`$89>0XZI0VO$8&PIW;B/@/+X5?SM`Z7@/KMTC5J6+@VG*DN
MM`)'&?7CCRSFJ-Q&,5OUW_J*,3&YSRI272.C7]52GRF2F-"C<NR%)S\@!ZX&
M?A5I<NGT1RQOW?3=Y3=&HN?&;VX4`!DD?(<XQVK-Q&-6TD[S#&Q%@0-4III?
MI\G4FG'KJ+HF,MMTM[7$>XD#!42K/\)S7VO_`$]AP-,+OEIO2+BTR0'-J1M5
M[VTE)!/8GM0/$X@VB][J;E/5U`M75HTA?[ZSX]NMSCK.<!Q1"$GY%1&?I5+7
M>;["N\W2,!O1TI#"$H01L7L*V]O`2KR_E2<3G.+2!6_<](V+&'LGM.,W;3=Y
ML6/M.WO1TJ.`LC*2?3<.*KO#7X?B;%;"<;L<9^=*]03=4NKA635;ST>.'@?$
M<0#QD`JW#A>`3Y^=.->6NS.:2MC<F["*U%:*H^UK/M!"!@`9XSQ^M#U!32&W
MOQ#R@;([>9QJI3BQ=.FKQIAB]KO+<5"UGQ?%1A+2$J())SR>/AWKR!H"-=KU
M/3#NR?L>`!XD]0!"CMW$)P<<<\YXJAXG$"=^D3E/MMU@BI32]:$B-:?<ONG[
MN+G$95AX%&U2?4_3(XP..:\LFA(SU@3?=0746R$Z<,@(W*7Z'ZXX&#QS1]1C
MTZK]O>_B;E-=0962FUI2E2D*"5?=)'!^5-+CH1BRWJU+=NB'+1/6"B8$=N,@
M$9YSQ@TEZM0+6XVS)D7/V>4PP0Q$2WGQ<J[Y\O\`Y4_5)K55WN-R31)[3GL;
M2.H9L9N3&M$EUEU.Y"THX4/6M:Y6&ZV9#:[E`>BI<)""XG&XCO76@N_(Z76<
MZ=#AF[&\[$I)V8.?O<>E$V;7?M7:C9L>K+B]$?:94\PE3*"59(R.,>0^/:II
MQ+$DM5"_G:,V(``"[/V@&I2BTZ*?N6M).GEO%D1E.>(]LSA*>QQ\<I_6MRV=
M/TW.]7-E%R#=KMBRAZ:M&-Q`]X`9QQ@\Y[5T-Q&->I[7)C&Q[074II>M"1&M
M/N7W3]W%SB,JP\"C:I/J?ID<8''-?>T=-V+GI>+>W+VW%;=)4Z7482T@$@\Y
MY.0/2AZG$%U$]Z_N;E/=5`E9);6L**$*4$C*L#.!3#5VA(]@LT:\6ZYB=$?6
M$;MH\P2""#@C@TQT];+4KI.\RNZ):8DIW2)/A_V*B4Y21YX/%(_%($#KO9J,
MN%BQ!G'*E);#I$:DU-(MENFA4-@J49:D=T`X!"<^?D,U8WG2.EH<2886JDN2
MX:3O8<0/?4.-J>W.?3-4.=`VGO\`!BC&Q%P34J_M-XM,2&RS/M_M)0M>_:VD
M$H4DI/O$\GG(X&"//C%5<I+4VY/RF&4L-NK*PTD`!&?(`>54#$M51"!5W%O2
M3]]/^U<_Q%4NMOWTNW_4JKS2%PE6R]^T0W?"=\)2=VT'@X]16E?)#LN]RY#Z
M][KCI4I6`,GZ5$(?4%O:4+#E@>\Z#J[\';#_`'F/_&NL-2?@O9?S6_\`!=&[
MO>)\K1L"`\_NC,E&Q&Q(QA)`Y`SYUY<KO.?T5"M[K^Z,TI)0WL2,8"O/&?,U
MSKA8!?J)E"XW^(OZDH5.T-8Y4)"G(P*#[@R$@HX_]5AKO^I]+;'"E#;*_8X0
MK[PVMG/Z9`JIZ<Z@NK)=MZ)BO94)W(;4D*"2?3(X^5&]5WBX7>]O*GRE/EE1
M0V"``D>@`XI<>%@XQGHIO[PLXTEO.T?=4OWHTY_?_P!::RU9^,-@_N-?YUT2
MU5>KA<;K;7I<CQ'&%9;.Q(Q[P/D/A65VO=QDZRM\]Z1NDLI2$+V)&,*)'`&/
M.LF%@JCP#^86R`D_(EQJN9<8'5P2K5&5)E-MH*60DG>/#]X8'PS5];9VG^H<
MY^'<]-N1IS;6Y;JAA0Q@8WC!SSP"*!7'4=V8UC]J-3"F84I07`A/*<`8QC'\
MJ?:JU%=H>DA*C3"T^XD!3B4)SS]./I4\F-@$4=:`!LQD8$L>WB?+2$-MC26J
M[)"7XTB._):21]Y8*-J#]2DUJ=+4+@:8ODR:A3<;U6,`[4G=W^8H#IJ\W&TW
MMIZ#+6RMY00X1@A8)\P>#2GJ+J"ZNMLV]4Q7LSJ=SC:4A(41CO@9^E4R8'U'
M'>S4;^(JY!0;Q-W2GX-WW\Q[_(BO+5^!UQ_-/^=%&K3=Y\;1D^WLO[8SREE:
M-B3G*4@\XSY5Y$N\YO0LFVH?Q%6LE3>Q//O`]\9\J9L3$GZ@8H<4/B&0"3@<
MFET)S7FDEICQV+@RV>0UX1=;.?08(_3FB3:UM.)<;44K00I*@>01YUU_1VJ+
MU<;.IV7-+JT`@*+:<_R'-7XIBJW0(]XF(`GK1GTZ@/*E],V)-W82Q<%EI26\
M8*7#]X#T]W=Q55U,0M>CM.*2DJ`0,D#M^S30O55\N=XNS@N$M;Z6%%+:2`$I
M'P`P/K2S3^I;O_0>0@S"I,=!;;W-I5M2!P.1S]:Y1A;$J-X-_>5.0.6'M^I]
MF?P&=_,_WQ6]TT>CN=/[HQ[+[8MMQQ3D4'!=!0,#ZX(H6B[SQH%=L#_]4*LE
MO8G_`)F>^,]_C5=IF\7"SWAIRWREL*=4$+P`0I.>Q!X-.W#EL;B_\KBC(`RG
MVJ-%:RBMZ8ND&VZ/?AQ76EI><2L[&U*&T*/N_+]*0SIUN3TUL\QZR_;$5MII
M*FDG'AD(VE1X/8@CZT9ZA:DO'LC4(35)CR$_M4)2D;_@2!G'PJMZ>7^Z0YYM
M[$Q:8J@5EH@*&?49''TJ1PZL?,`K>^I_<?F4^D_J;VI=5?:UDM4!O3S]MBHE
M(5'<6K*2$C!2G@?Q"OOUG0LW>W+"3M]G4,XX^]5!KN_72Y7=427,6XPP<MMX
M"0D^O`&3\35]+U)=YO3M1DS"Z76_#65-I)4GMWQ_/O5%QE#C<#SW/>*6#:E/
M_5+V0_>H_2JSKL(D&7M:!\!O>K;@YXP>.U`G;CJ:V:B@7^^,3`XRXE(<?9*-
MR1G*1P/(G]:O['JF]1+)$CL3=C3;02E/A(.!]155K6^W*ZP([4V3XJ$.E21L
M2G!Q\`*&%&5RI`HD[]YG8%003M.E700]/HO.L&5(4J5#;#1]58(3]#E'Z50=
M-I#+^@;LTJ-[<ZEUU;T;/O/`H&!]<$4)NE\N<K1D&WO2E+C(4D)1M`X2#@9Q
MDXJOTS>+A9[PTY;Y2V%.J"%X`(4G/8@\&@O"-RF!.]_KI"<PU@UM_N-%:RBM
MZ8ND&VZ/?AQ76EI><2L[&U*&T*/N_+]*SE?@-%_,_P!]5:_4+4EX]D:A":I,
M>0G]JA*4C?\``D#./A5"[=YZM`M6POYB)5D-[$_QD]\9[_&BF+4JL!7\@>I,
MS/1(/B);_P#@I:/S4?ZZSLJ5+Z(W)*$E1WK.`,_\231:X7><]HB';G']T5M:
M2AO8D8^]YXSYFK'IQ>[E#>DP6)13&*2YX92"-W;/(XHMB88B?#7^8`X+CXJ5
MNA[Q=;#=GY=OMSDY"6<264I.0C(YX'&#CRIVQ$TSU"M-QF"SJMLQ@$J?V[??
M()SD<*[<Y%#K9J2[Q-<276)>Q4Q_:_AM.%@=N,8_2DW4J_72/:FHK,M3;4D;
A7DI2!O&.V<9H9E9LHT[$][,.,@(;W`G*:E2I7ISDG__9
`
end

</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
