Physiometrix Announces Definitive Agreement for Acquisition by Hospira

Physiometrix Announces Definitive Agreement for Acquisition by
Hospira 


NORTH BILLERICA, Mass., June 1  /PRNewswire/ -- Physiometrix, Inc.
(NASDAQ:PHYX) announced today a definitive merger agreement to be acquired by
Hospira, Inc. (NYSE:HSP), a global specialty pharmaceutical and medication
delivery company.  After the acquisition, Hospira will market the Physiometrix
depth of consciousness anesthesia monitoring products, including the current
PSA 4000 system and the PSA 5000 system, which is targeted to be launched this
year.

"Our mission from day one has been to serve our shareholders, customers and
employees.  This merger with Hospira is the best platform to move our
technology towards being the standard of care. It will allow the continuation
of the Physiometrix product line and enable us to continue to address the
expanded needs of our clinical partners. This combination of Hospira and
Physiometrix makes great sense and we are very excited about the opportunity it
presents," said John A. Williams, Chief Executive Officer of Physiometrix, Inc.

Under the terms of the agreement, unanimously approved by the Physiometrix
Board of Directors, Physiometrix shareholders will receive a cash payment of
$1.59 per share of common stock.  In addition, holders of options and warrants
for common stock of Physiometrix will receive a cash payment equal to this
amount less the applicable exercise price and applicable withholding taxes.
Together, these payments give the merger a value of approximately $23 million.
Options and warrants with an exercise price that exceeds the per share cash
payment will be terminated in connection with the closing.

Closing of the merger is contingent upon approval of the shareholders of
Physiometrix and other customary closing conditions.  Physiometrix will call a
meeting of shareholders as soon as practicable to vote on the merger.
Physiometrix expects that the merger would close during the third quarter of
2005 if the closing conditions are satisfied.

Physiometrix Inc. designs, manufactures and markets noninvasive medical
products -- based on novel gel materials, sophisticated signal-processing
electronics technologies, and proprietary software for use in anesthesia
monitoring during surgical procedures and in other medical settings, including
the intensive care unit.  For more information, please visit the Company's web
site at http://www.physiometrix.com/.

WHERE YOU CAN FIND ADDITIONAL INFORMATION

Physiometrix will file a proxy statement and other documents concerning the
proposed merger transaction with the SEC. Security holders are urged to read
the proxy statement when it becomes available and other relevant documents
filed with the SEC because they will contain important information about
Physiometrix and the merger.  A proxy statement will be sent to shareholders of
Physiometrix seeking their approval of the transaction. Physiometrix security
holders may obtain a free copy of the proxy statement (when it is available)
and other documents filed by Physiometrix with the Commission at the
Commission's Web site at http://www.sec.gov/.  The proxy statement and these
other documents may also be obtained for free from Physiometrix Investor
Relations, Five Billerica Park, 101 Billerica Avenue, North Billerica,
Massachusetts, 01862 or [phone].  Physiometrix and Hospira and their
respective directors and executive officers and other members of their
management and their employees may be deemed to be participants in the
solicitation of proxies from the shareholders of Physiometrix with respect to
the transactions contemplated by the merger agreement.  Information about
Physiometrix, Hospira and their respective directors and officers can be found
in Physiometrix's and Hospira's respective Proxy Statements and Annual Reports
on Form 10-K filed with the SEC. Additional information regarding the interests
of those persons and their respective interests in the merger may be obtained
by reading the proxy statement/prospectus when it becomes available.   This
document will be available free of charge at the Securities and Exchange
Commission's Web site at http://www.sec.gov/ and from Physiometrix.

Statements in this press release regarding Physiometrix's growth and future
business results are "forward-looking" statements as defined in the Private
Securities Litigation Reform Act of 1995.  Such statements are based upon
management's current expectations and are subject to a number of factors and
uncertainties.  Information contained in these forward-looking statements is
inherently uncertain, and actual performance and results may differ materially
due to many important factors.  Such factors that could cause actual results to
differ materially from any forward-looking statements made by Physiometrix
include, among others, revenue estimates, dependence on existing and future
products, dependence upon third-party distribution and sales arrangements, the
existence of alternative technologies and the potential emergence of new
methods for consciousness monitoring, uncertainty of market acceptance, intense
competition, partnership agreements, and government regulations, especially
regulatory approvals.  These and other relevant risks are described in the
Company's Form 10-K dated March 31, 2005 filed with the SEC; in addition, the
closing of the merger is contingent upon the ability of Physiometrix and
Hospira to satisfy closing conditions specified in the merger agreement.  The
Company disclaims any obligation to update information contained in any
forward-looking statement to reflect events or circumstances occurring after
the date of this press release. 

DATASOURCE: Physiometrix, Inc.



CONTACT:  Daniel W. Muehl, CFO of Physiometrix Inc., [phone] 



Web site:  http://physiometrix.com/ 

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