Physiometrix Announces Fourth-Quarter and Year-End 2004 Financial Results

Physiometrix Announces Fourth-Quarter and Year-End 2004 Financial
Results
Company grows market share of PSA 4000 units shipped to U.S. Hospitals From 3%
in Q1 2004 to 20% in Q4 2004 


NO. BILLERICA, Mass., March 3  /PRNewswire-FirstCall/ -- Physiometrix, Inc.
(NASDAQ:PHYX) announced today financial results for the fourth quarter and
twelve months ended December 31, 2004.  For the fourth quarter ended December
31, 2004, revenues were $425,000, compared with revenues of $689,000 for the
same period in 2003. For 2004, revenues were $1,891,000, compared with revenues
of $1,738,000 for 2003, representing a 9% increase. The net loss for the fourth
quarter of 2004 was $(1,164,000), or $(0.09) per share compared with a net loss
of $(4,442,000), or $(0.44) per share, for the same period in 2003. For the
twelve months of 2004, the net loss was $(6,337,000), or $(0.47) per share,
compared with a net loss of $(8,050,000), or $(0.91) per share, in the same
period of 2003. The decrease in the net loss for the twelve months ended
December 31, 2004 over the same period in 2003 was primarily due to the
inclusion of a non-cash expense in the amount of $1.1 million in 2004 versus
$2.9 million in 2003, associated with a warrant derivative related to the
registration of shares of Common Stock in connection with its' PIPE
transaction.

"Physiometrix and Baxter, our distributor, have increased the installed base of
our PSA 4000 monitor again this quarter. Our fourth quarter market share
represented 20% of all shipments of level of sedation monitors in the U.S.
Additionally, disposable array sales by Baxter to hospitals reached an all time
high, increasing for the third consecutive quarter," said John A. Williams,
Physiometrix's President and Chief Executive Officer. Williams continued; "

  * PSA 4000 sales to hospitals by Baxter increased by 19% and disposable
    array sales by Baxter increased 45% as compared to Baxter's sales for
    the third quarter of 2004
  * We continue to work with Baxter on increasing market share in U.S.
    operating rooms
  * We anticipate adding to our sales and marketing staff to continue
    increasing market share
  * The American Society of Anesthesiologists (ASA) taskforce continues its
    work on a practice parameter related to intra-operative brain
    monitoring, and we have been invited to address the committee again in
    March and April of 2005
  * A recent alert published by the Joint Commission on Accreditation of
    Healthcare Organizations (JCAHO) related to safety issues associated
    with general anesthesia appears to be having a positive effect on the
    number of evaluations requested by hospitals
  * Level of sedation monitoring shipments to hospitals in Q4 was the
    highest in two years
  * The PSA 5000 is being readied for launch in both the operating room and
    ICU markets in mid-2005
  * We look forward to the completion of key studies in the ICU to support
    our product launch for ICU applications
  * We sponsored a very successful and well-attended symposium along with
    Baxter at the Society of Critical Care meeting on January 16th 2005.
    This has generated significant leads in the ICU
  * We have funded a most anticipated clinical study in 2005 related to
    cognitive dysfunction in patients following general anesthesia. It is
    intended to highlight important safety concerns for patients and could
    be very influential in advancing the case for sedation monitoring as
    standard of care



We are looking forward to continuing our penetration of the level of sedation
market with the launch of our next generation PSA 5000 and are encouraged by
our ability to compete for sales in this expanding marketplace," Williams
concluded.

Physiometrix will hold a telephone conference call to discuss fourth- quarter
2004 financial results, as well as management's comments related to the
Company's business, at 11:00 A.M. (Eastern) today, March 3, 2005.  The call can
be accessed at 800-465-7133  (conf. ID # 4346264).  A replay of today's
conference call will be available after conclusion of today's conference call
until 11:59 P.M. (Eastern) on Thursday, March 10, 2005. Replay callers in the
U.S. must dial 800-642-1687 (conf. ID # 4346264).

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.  For more information, please visit the
Company's Web site at http://www.physiometrix.com/.

Statements in this press release regarding Physiometrix's growth and future
business results of the Company 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
the Company 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 30, 2004 filed with the
SEC.  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.

  CONTACT:
   Daniel W. Muehl, CFO
   Physiometrix Inc.
   978-670-2422

                     -- Financial Tables to Follow --



   Physiometrix, Inc.
  Condensed Statements
     Of Operations
      (Unaudited)
                          Three Months Ended      Twelve Months Ended
                              December 31             December 31
                          2004          2003        2004        2003

  Revenues              $425,004     $689,441   $1,891,112   $1,737,804

  Costs and expenses:
  Cost of goods sold     393,353      767,769    1,942,529    2,096,347
  Research and
   development           483,588      377,909    1,812,893    1,567,155
  Selling, general,
   and administrative    724,346    1,062,660    3,486,182    3,218,964
                       1,601,287    2,208,338    7,241,604    6,882,466
  Operating loss      (1,176,283)  (1,518,897)  (5,350,492)  (5,144,662)

  Other income (expense):
  Change in fair value
   of warrant derivative       -   (2,929,131)  (1,046,080)  (2,929,131)
  Interest income         12,183        5,926       59,110       23,540

  Net loss          $(1,164,100) $ (4,442,102) $(6,337,462)  $(8,050,253)

  Net loss per share     $(0.09)      $(0.44)      $(0.47)      $(0.91)

  Shares used in computing
   net loss per share 13,670,753   10,075,490   13,594,751    8,836,118



      Physiometrix, Inc.
  Condensed Balance Sheets
        (Unaudited)


                                                December 31    December 31
                                                    2004           2003
  ASSETS

  Current assets:
  Cash, cash equivalents and short
   term investments                             $2,588,737    $ 7,626,049
  Other current assets                             503,761        966,484
  Total current assets                           3,092,498      8,592,533

  Property, plant and equipment, net               103,718        179,668

  Total assets                                  $3,196,216    $ 8,772,201

  LIABILITIES AND STOCKHOLDERS'
  EQUITY (DEFICIT)

  Current liabilities:
  Accounts payable and accrued expenses           $712,524       $971,281
  Warrant derivative contract                            -     11,342,730
  Total current liabilities                        712,524     12,314,011

  Total stockholders' equity (deficit)           2,483,692     (3,541,810)

  Total liabilities and stockholders'
   equity (deficit)                             $3,196,216    $ 8,772,201


DATASOURCE: Physiometrix, Inc.



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



Web site:  http://physiometrix.com/

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