Companies Committed to Improving the Quality and Cost-Effectiveness of
                    HIV/AIDS Patient Monitoring and Care

    WAYNE, Pa., June 27 /PRNewswire-FirstCall/ -- Escalon Medical Corp.
(Nasdaq: ESMC) today announced that its subsidiary, Drew Scientific, Inc.,
has signed a non-exclusive manufacturing, worldwide distribution and
co-marketing agreement with PointCare Technologies, Inc., a privately-held
medical diagnostics company that provides CD4 blood cell testing systems to
monitor immune system functions and progression of disease in patients with
HIV/AIDS.
    Under the agreement, Drew Scientific will expand its Excell 22(TM) five
part differential hematology platform to perform PointCare's proprietary
CD4 test. Concurrently, PointCare technologies will modify its patented
chemical reagents to run on the Excell 22(TM).
    The new diagnostic platform is expected to be launched in the first
half of 2007, subject to 510(K) application submission and review by the
U.S. Food and Drug Administration, and both companies will have the rights
to market the instrument and reagents worldwide. This testing platform is
expected to be the first system to provide the combination of hematology
and CD4 testing on an affordable, fully automated instrument. The new
method will be much easier to use than existing CD4 techniques. Therefore
it can be used in HIV/AIDS clinics worldwide even if highly trained
laboratory specialists, necessary for current CD4 techniques, are not
available. In such settings the new platform is expected to become a key
component in rapidly determining the drug therapy required by providing the
test results during the same visit. As a crucial component to monitor the
HIV/AIDS infection and ensuring the effective treatment of antiretroviral
drugs, the World Health Organization recommends that CD4 should be measured
in all HIV/AIDS patients every three months.
    Dr. Petra Krauledat, PointCare Technology's President and Chief
Executive Officer, noted, "We are very excited about the strategic
relationship with Drew Scientific and its parent Escalon Medical Corp.
Working together we plan to make immune hematological testing easier and
more broadly usable. An invention by Dr. Peter Hansen, PointCare's Chief
Scientific Officer, brought CD4 testing out of the research laboratory and
into the clinical setting, 25 years ago by eliminating complex and
cumbersome sample preparation techniques. It is now time to take the next
step and leave the special hematology laboratory behind, where CD4 tests
are performed today, and move it into a setting much closer to the patient.
PointCare's proprietary technology is based on colloidal nanoparticles and
in combination with Drew's achievements in highly automated, yet affordable
instrumentation, will now allow for CD4 tests to be performed in the
clinical setting simultaneously with routine blood cell counting, which is
essential for complete patient care."
    Richard J. DePiano, Escalon's Chairman and Chief Executive Officer
commented, "We are excited about this opportunity to integrate Drew's
strengths in hematology instrumentation, sales and distribution with the
clear innovation of PointCare Technologies. PointCare has earned a positive
reputation in the market for easy to use CD4 analyzers that can be used in
remote locations and, jointly, we look forward to providing diagnostic
facilities to all regions worldwide. Additionally, this collaboration will
extend our product portfolio and, by offering a fully integrated, low cost
instrument that will be unique in its ability to perform both a full
hematology test and a CD4 test, will provide us the opportunity to develop
new markets for our hematology business."
    About PointCare Technologies, Inc.
    PointCare Technologies Inc. is a privately held company located near
Boston, Massachusetts. It has provided instruments and reagents to HIV
clinics in various countries, including sub-Saharan Africa. PointCare's
patented technology uses gold nanoparticles to accurately measure CD4
positive lymphocytes thereby avoiding the delays and expense related to
fluorescence technology.
    About Escalon
    Founded in 1987, Escalon develops markets and distributes ophthalmic
diagnostic, surgical and pharmaceutical products as well as vascular access
devices. Drew, which operates as a separate business unit, provides
instrumentation and consumables for the diagnosis and monitoring of medical
disorders in the areas of diabetes, cardiovascular diseases and hematology,
as well as veterinary hematology and blood chemistry. Escalon seeks to
utilize 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 Escalon's
distribution capabilities. Escalon has headquarters in Wayne, Pennsylvania
and manufacturing operations in Long Island, New York, New Berlin,
Wisconsin, Dallas, Texas, Oxford, Connecticut and Barrow-in-Furness, U.K.
    Note: This press release contains statements that are considered
forward-looking under the Private Securities Litigation Reform Act of 1995,
including statements about Escalon's future prospects. They are based on
the Escalon'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 Escalon is able to improve upon the
operations of Escalon's business units, including, the integration of
Drew's operations, generate cash and identify, finance and enter into
business relationships and acquisitions, integrate and leverage those
business relationships and acquisitions, uncertainties and risks related to
new product development, commercialization, manufacturing and market
acceptance of new products, marketing acceptance of existing products in
new markets, the continuity of royalty revenue, litigation and
non-recurring expenses, research and development activities, including
failure to demonstrate clinical efficacy, delays by regulatory authorities,
scientific and technical advances by Escalon 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 Escalon'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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