Lattice Biologics Gains "Preferred Vendor Status" With the Veterans Health Administration (VHA)

SCOTTSDALE, AZ--(Marketwired - August 01, 2016) - NOT FOR DISSEMINATION IN THE US OR THROUGH US NEWSWIRE SERVICES

Lattice Biologics Ltd. (TSX VENTURE: LBL) (OTCBB: BLVKF) (the "Company") announced today that it has received preferred vendor status with the Veterans Health Administration (VHA), the health and medical services arm of the US Department of Veteran Affairs (the VA). The VHA is the largest integrated health care system in the United States, providing care at 1,233 health care facilities, including 168 VA Medical Centers and 1,053 VHA outpatient clinics, serving more than 8.9 million Veterans each year.¹ This prestigious distinction was facilitated through the agreement established by Lattice Biologics' National Director of Sales, Darrell Denslow's distributorship, 3D Spine, which specializes in spinal and orthopedic implants.

"We are honored to serve the Country's veterans through our life-changing allografts and surgical support. As a US Air Force veteran, helping achieve the mission of meeting the needs of our service members is especially close to my heart," shared Darrell Denslow. "This is some of the most important work we can do."

"We view the opportunity to provide our high quality products to veterans as a key part of the VHA's "Blueprint for Excellence," which includes the four themes: improve performance; promote a positive culture of service; advance health care innovation for veterans and the country; and increase operational effectiveness and accountability," stated Lattice Biologics CEO, Guy Cook.

"In particular," continued Cook "the application of Lattice's technology will help deliver the Blueprint's second strategy, to 'Deliver high quality, Veteran-centered care that compares favorably to the best of private sector in measured outcomes, value, efficiency, and patient experience,' which makes our whole team extremely proud."

Meeting the Demand -- Solutions Tailored to the VA's Needs:

Lattice Biologics' products and technology align with a wide range of traditional hospital-based services provided by VHA Medical Centers, such as: surgical specialty, critical care, orthopedics, neurology, oncology, podiatry, and plastic surgery. The centers also offer mental health services, organ transplants, pharmacy, radiology, physical therapy, prosthetics, urology, and vision care.

Lattice Biologics' catalogue of biologic products offers solutions for a large number of medical cases VA Hospitals typically treat. When analyzing injuries sustained by deployed soldiers, researchers identified that orthopedic injuries were the most common of all disease and non-battle related injuries. For example, musculoskeletal injuries represented 50% of all disease and non-battle related injuries -- and 38% of all losses from the combat zone -- for a large Army unit deployed as part of Operation Iraqi Freedom. Of the musculoskeletal injuries, 40% involved the upper extremities, 43% the lower extremities, and 17% the axial spine, with hand (17.5%), lumbar spine (13.5%), knee (13.5%), ankle (13.5%), and shoulder (11.8%) locations as the most frequent sites of injury.² Lattice's solutions for orthopedic indications include: traditional, Spinal, and particulate allografts as well as 100% demineralized bone matrix putty.

Additionally, the Company offers a wide range of membrane and barrier allografts, such as AdMatrix acellular dermal matrix products, which are beneficial in a variety of common surgical applications for veterans:

• Enhancing fusion in spine surgery
• Advanced healing for reconstruction and plastic surgeries
• Effective sports medicine indications, including ACL repair
• Promotion of bone regeneration in foot and ankle surgery
• Promotion of skull healing following neurosurgery
• Enhancing wound repair in burn victims
• Subchondral bone defect repair in knee and other joint surgeries

Fiscal Impact:

This preferred status represents a significant financial opportunity for the Company. The VHA administers an annual budget of approximately $59 billion, overseeing the delivery of care to more than 9 million enrolled Veterans, with more than 305,000 health care professionals and support staff employees.¹

Lattice Biologics Ltd.

Guy Cook,

Chief Executive Officer

Telephone No: (480) 563-0800

References:

¹ http://www.va.gov/health/aboutVHA.asp

² http://www.medpagetoday.com/meetingcoverage/aaos/19015

About Lattice Biologics Ltd.:

Lattice Biologics recently completed its RTO, becoming a publically traded company on January 4, 2016 and is traded on the TSX-V under the symbol: LBL. The Company is an emerging personalized/precision medicine leader in the field of cellular therapies and tissue engineering, with a focus on bone, skin, and cartilage regeneration.

Lattice Biologics develops and manufactures biologic products to domestic and international markets. Lattice's products are used in a variety of surgical applications.

Lattice Biologics maintains its headquarters, laboratory and manufacturing facilities in Scottsdale, Arizona as well as offices in Toronto Ontario. The facility includes ISO Class 1000 and ISO Class 100 clean rooms, and specialized equipment capable of crafting traditional allografts and precision specialty allografts for various clinical applications. The Lattice Biologics team includes highly trained tissue bank specialists, surgical technicians, certified sterile processing and distribution technicians, and CNC operators who maintain the highest standards of aseptic technique throughout each step of the manufacturing process. From donor acceptance to the final packaging and distribution of finished allografts, Lattice is committed to maintaining the highest standards of allograft quality, innovation, and customer satisfaction.

Lattice Biologics maintains all necessary licensures to process and sell its tissue engineered products within the U.S. and internationally. This includes Certificates to Foreign Governments from the U.S. Food and Drug Administration (FDA) and registrations for 29 countries, which allow the export of bone, tendon, meniscus, ligament, soft tissue, and cartilage products outside of the U.S.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Cautionary Statement on Forward-Looking Information:

Certain information contained in this news release constitutes "forward-looking statements" within the meaning of the 'safe harbour' provisions of Canadian securities laws. All statements herein, other than statements of historical fact, are to be considered forward looking. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "potential", "future", "expected", "could", "possible", "goal", "intends", "will" or similar expressions identify forward-looking statements. Forward-looking statements in this news release include, without limitation: information pertaining to the Company's strategy, plans, or future financial performance, such as statements with respect to future sales or revenues, expected outcomes with respect to the Company's research studies, and other statements that express management's expectations or estimates of future performance. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Lattice to be materially different from those expressed or implied by such forward-looking statements.

Forward-looking statements are necessarily based upon a number of factors and assumptions that, while considered reasonable by management as of the date such statements are made, are inherently subject to significant business, economic and competitive uncertainties and contingencies. The factors and assumptions that could prove to be incorrect, include, but are not limited to: that market prices will be consistent with expectations, the continued availability of capital and financing, and that general economic, market and business conditions will be consistent with expectations. The forward-looking statements are not guarantees of future performance. We disclaim any obligation to update or revise any forward-looking statements, except as required by law. Readers are cautioned not to put undue reliance on these forward-looking statements.

United States Advisory: The securities referred to herein have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), and may not be offered, sold, or resold in the United States or to, or for the account of or benefit of, a U.S. Person (as such term is defined in Regulation S under the U.S. Securities Act) unless an exemption from the registration requirements of the U.S. Securities Act is available. This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in the state in the United States in which such offer, solicitation or sale would be unlawful.

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