WAYNE, Pa., Feb. 8 /PRNewswire-FirstCall/ -- Escalon Medical Corp.
(Nasdaq: ESMC) today announced that it has restated its September 30, 2001
financial statements by reallocating intangible assets related to its January
2000 purchase of Sonomed, Inc.  As a result of an independent professional
appraisal, the intangible assets have been allocated as $10,547,488 goodwill
and $665,000 to trademarks and trade names.  The Company initially had
allocated them as $7,700,000 customer lists, $2,300,000 trademarks and trade
names and $1,212,488 goodwill.  The total reported value of the intangible
assets has not changed.  Therefore, this reclassification has no effect on
reported earnings, net worth or cash flows for any prior fiscal years.
    The result of this reallocation is solely to reclassify the intangible
assets among customer lists, trademarks and trade names and goodwill.  This
reclassification came about as a result of the Company engaging an independent
professional appraiser in November 2001 to review the allocations and evaluate
whether any assets were impaired.  The reallocation resulted in a reduction in
amortization expense for the Company's first fiscal quarter and a subsequent
increase in net income and diluted earnings per share of $128,334 and $0.039
respectively.  For additional information regarding this matter, please refer
to the Company's Form 10-Q/A filed February 8, 2002 with the Securities and
Exchange Commission.

    Founded in 1987, Escalon develops, markets and distributes ophthalmic
diagnostic, surgical and pharmaceutical products as well as vascular access
devices.  The Company utilizes strategic partnerships to help finance its
development programs and is also seeking acquisitions to further diversify its
product line to achieve critical mass in sales and take better advantage of
the Company's distribution capabilities.  Escalon has headquarters in Wayne,
Pennsylvania and manufacturing operations in Long Island, New York and New
Berlin, Wisconsin.

    Note:  This press release contains statements that are forward-looking,
including statements about the Company's future prospects.  They are based on
the Company's current expectations and are subject to a number of
uncertainties and risks, and actual results may differ materially.  The
uncertainties and risks include whether the Company is able to improve upon
the operations of Sonomed, the vascular access business and Escalon Medical
Imaging, generate cash and identify, finance and enter into business
relationships and acquisitions, uncertainties and risks related to new product
development, manufacturing and market acceptance of new products, marketing
acceptance of existing products in new markets, research and development
activities, including failure to demonstrate clinical efficacy, delays by
regulatory authorities, scientific and technical advances by the Company or
third parties, introduction of competitive products, third party reimbursement
and physician training as well as general economic conditions.  Further
information about these and other relevant risks and uncertainties may be
found in the Company's report on Form 10-K, and its other filings with the
Securities and Exchange Commission, all of which are available from the
Commission as well as other sources.

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