In particular, injuries sustained from improvised explosive devices (IEDs) are difficult to treat due to the usually significant loss of bone and soft tissue. The fracture putty system is intended to provide substantial support of the injured limb early in the body's natural healing process so the soldier can more quickly participate in physical therapy and thus reduce the risk of further complications. The putty will then resorb - meaning it will dissolve over time, leaving natural healthy bone in its place. Today's standard treatment methods include permanent metal support devices such as plates, rods and bone screws.

Smith & Nephew is the only medical device company chosen to work on this futuristic material. Beyond this initial project, the company may expand the application of the technology to the treatment of other kinds of bone fractures in both military and civilian trauma care.

"Fracture putty represents the ultimate convergence of orthopaedic material science and mechanics, and has the potential to revolutionize the way patients are treated," said DARPA's program manager, Mitchell Zakin, PhD. "If all technical challenges are met, we believe this innovative technology will provide superior clinical outcomes for patients."

"This announcement represents the spirit of innovation that drives Smith & Nephew scientists and engineers," said David Brumfield, vice president of product development in Smith & Nephew Orthopaedics' Trauma franchise. "We will use the full extent of our expertise, ground-breaking material technology and quality manufacturing to create the best possible treatment for those who have been injured while serving our country."

Smith & Nephew's history of orthopaedic trauma innovation includes the introduction of the compression hip screw and intramedullary hip fracture fixation. Additionally, Smith & Nephew was responsible for introducing the ILIZAROV(TM) method of external circular fixation to the United States, which is manifested today in its award winning TAYLOR SPATIAL FRAME(TM) device, a technology currently used to treat complex fractures sustained by US military personal.

About us

Smith & Nephew is a global medical technology business, specialising in Orthopaedics, including Reconstruction, Trauma and Clinical Therapies; Endoscopy and Advanced Wound Management. Smith & Nephew is a global leader in arthroscopy and advanced wound management and is one of the leading global orthopaedics companies.

Smith & Nephew is dedicated to helping improve people's lives. The Company prides itself on the strength of its relationships with its surgeons and professional healthcare customers, with whom its name is synonymous with high standards of performance, innovation and trust. The Company operates in 32 countries around the world. Annual sales in 2008 were $3.8 billion.

About DARPA

DARPA is the central research and development organization for the U.S. Department of Defense (DoD). It manages and directs selected basic and applied research and development projects for DoD, and pursues research and technology where risk and payoff are both very high and where success may provide dramatic advances for traditional military roles and missions.

Forward-Looking Statements

This press release contains certain "forward-looking statements" within the meaning of the US Private Securities Litigation Reform Act of 1995. In particular, statements regarding planned growth in our business and in our trading margins discussed under "Outlook" are forward-looking statements as are discussions of our product pipeline. These statements, as well as the phrases "aim", "plan", "intend", "anticipate", "well-placed", "believe", "estimate", "expect", "target", "consider" and similar expressions, are generally intended to identify forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors (including, but not limited to, the outcome of litigation and regulatory approvals) that could cause the actual results, performance or achievements of Smith & Nephew, or industry results, to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. Please refer to the documents that Smith & Nephew has filed with the U.S. Securities and Exchange Commission under the U.S. Securities Exchange Act of 1934, as amended, including Smith & Nephew's most recent annual report on Form 20F, for a discussion of certain of these factors.

All forward-looking statements in this press release are based on information available to Smith & Nephew as of the date hereof. All written or oral forward-looking statements attributable to Smith & Nephew or any person acting on behalf of Smith & Nephew are expressly qualified in their entirety by the foregoing. Smith & Nephew does not undertake any obligation to update or revise any forward-looking statement contained herein to reflect any change in Smith & Nephew's expectation with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

SOURCE Smith & Nephew

http://www.smith-nephew.com

The Special Meeting will be held at the offices of Bennett Jones LLP, Suite 4500, 855 2nd Street S.W., Calgary, Alberta at 10 a.m. MST. NUCRYST shareholders of record on November 25, 2009 will be entitled to vote at the Meeting. The Management Information Circular and Instrument of Proxy will be mailed on or before November 30, 2009.

About NUCRYST Pharmaceuticals

NUCRYST Pharmaceuticals Corp. (NASDAQ: NCST; TSX: NCS) develops, manufactures and commercializes medical products that fight infection and inflammation using SILCRYST(TM), its patented atomically disordered nanocrystalline silver technology. NUCRYST licensed world-wide rights for SILCRYST(TM) wound care coating products to Smith & Nephew plc, which markets these products in over 30 countries under their Acticoat(TM) trademark. NUCRYST is also developing pharmaceutical products to address medical conditions that are characterized by pain, infection and inflammation. The Company has developed its proprietary nanocrystalline silver in a powder form, referred to as NPI 32101 for use in medical devices and as an active pharmaceutical ingredient.

    SILCRYST(TM) is a trademark of NUCRYST Pharmaceuticals Corp.
    Acticoat(TM) is a trademark of Smith & Nephew plc

The financial results in this news release are unaudited, and are not a complete disclosure of our quarterly or results. This news release contains forward-looking statements within the meaning of securities legislation in the United States and Canada (collectively "forward-looking statements"). Forward-looking statements in this news release include, but are not limited to, statements about: our strategy, future operations, prospects and plans of management and our ability to achieve operating efficiencies and cost reductions. With respect to the forward-looking statements contained in this news release, readers are cautioned that numerous risks, uncertainties and other factors could cause our actual results to differ materially from those indicated in these statements including, but not limited to: future shareholder actions with respect to the proposed sale transaction, the proposed amalgamation, our capitalization or strategic direction; the failure to satisfy or waive any conditions to closing of the sale transaction or the amalgamation; the intervention of other events that result in any delay in completing or the failure to complete the sale transaction or the amalgamation; the performance of the stock markets generally; our ability to satisfy regulatory and stock exchange standards and requirements to complete the sale transaction or the amalgamation; the uncertainty of our future operating results, which are likely to fluctuate and could under certain conditions prevent the completion of the sale transaction or the amalgamation; our reliance on and ability to maintain our collaboration with Smith & Nephew should the proposed sale transaction not be completed; our reliance on sales of Acticoat(TM) products with our SILCRYST(TM) coatings by Smith & Nephew; changes in regulation or tax laws applicable to us; changes in general economic and capital market conditions; other risks and uncertainties that have not been identified at this time; and management's response to these factors. Although we have attempted to identify the important risks, uncertainties and other factors that could cause actual results or events to differ materially from those expressed or implied in the forward-looking statements in this release, there may be other factors that cause actual results or events to differ from those expressed or implied in forward looking statements. For a more thorough discussion of the risks associated with our business, see the "Risk Factors" section in our Annual Report on Form 10-K for the year ended December 31, 2008 and in our Quarterly Report on Form 10-Q for the quarter ended September 30, 2009, once filed with the U.S. Securities and Exchange Commission on EDGAR at www.sec.gov and with securities authorities in Canada on SEDAR at www.sedar.com. All forward-looking statements are expressly qualified in their entirety by this cautionary statement and NUCRYST disclaims any intention or obligation to revise or update any forward-looking statements whether as a result of new information, future developments or otherwise after the date hereof.

SOURCE NUCRYST Pharmaceuticals Corp.

"Smith & Nephew's PROFORE(TM) Multi-Layer High Compression Bandaging System is the market leader in this product category," Mr. Dugan added. "With a dedicated CPT code, multi-layer bandaging will now be more accessible to physicians and patients. We support this decision and believe that it will improve patient access to the standard of care, support sound clinical decision-making and improve patient outcomes for those with this condition."

"Smith & Nephew's multi-layer bandaging portfolio also includes the unique VARI-STRETCH(TM) technology of the PROGUIDE(TM) Two Layer High Compression Bandaging System. These multi-layer compression bandaging systems are part of a complete range of advanced dressings and wound management systems that facilitate appropriate product utilization across the continuum of wound care," said Randall Carson, Director, Government Affairs and Reimbursement, Smith & Nephew Advanced Wound Management. "The treatment of venous leg ulcers alone consumes more than $1 billion in the U.S. annually.(1) Smith & Nephew works hard to provide physicians with therapeutic options that support their clinical judgment and deliver value to their institutions and the health delivery system as a whole. The decision to assign a dedicated CPT code for venous wound compression is an important step towards meeting these goals."

About PROFORE and the Clinical Effectiveness of Four Layer Bandaging Systems

Four-layer compression bandaging systems offer advantages over two-layer systems in terms of reduced withdrawal from treatment, fewer device-related adverse incidents and lower treatment costs for patients with chronic venous leg ulceration.(3) PROFORE(TM) has been proven to close 79% of venous leg ulcers in 12 weeks.(4) In a study in the UK, which compared the cost of PROFORE to "usual care," annual treatment costs were reduced by 38-55% and patient outcomes were improved .(5) In June 2009, the British Medical Journal published a study from five randomized controlled trials of 797 patients, which compared wound closure rates and cost impact of four-layer compression bandaging systems to short stretch bandages in individuals with venous leg ulcers. The study found that four-layer bandaging systems provide faster wound closure of venous leg ulcers and increase the chance of healing by approximately 30%, when independent prognostic factors are considered, as compared to short stretch bandages.(6)

The PROFORE product portfolio includes a full range of options designed to apply effective, sustained, graduated compression on lower legs with various circumferences, and is available in latex-free alternatives. PROGUIDE(TM) is a high compression two-layer bandaging system, offering patients and clinicians additional treatment options with comparable healing rates to PROFORE.(7)

Please click here for more information about Smith & Nephew's complete line of multi-layer compression bandaging systems. For more information regarding Smith & Nephew, please visit www.smith-nephew.com.

About Smith & Nephew

Smith & Nephew is a global medical technology business, specializing in Orthopeadics, including Reconstruction, Trauma and Clinical Therapies, Endoscopy and Advanced Wound Management. Smith & Nephew is a global leader in arthroscopy and advanced wound management and is one of the leading global orthopeadics companies.

Smith & Nephew is dedicated to helping improve people's lives. The Company prides itself on the strength of its relationships with its surgeons and professional healthcare customers, with whom its name is synonymous with high standards of performance, innovation and trust. The Company operates in 32 countries around the world. Annual sales in 2008 were nearly $3.8 billion.

Forward-Looking Statements

This press release contains certain "forward-looking statements" within the meaning of the US Private Securities Litigation Reform Act of 1995. In particular, statements regarding expected revenue growth and trading margins discussed under "Outlook" are forward-looking statements as are discussions of our product pipeline. These statements, as well as the phrases "aim", "plan", "intend", "anticipate", "well-placed", "believe", "estimate", "expect", "target", "consider" and similar expressions, are generally intended to identify forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors (including, but not limited to, the outcome of litigation, claims and regulatory approvals) that could cause the actual results, performance or achievements of Smith & Nephew, or industry results, to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. Please refer to the documents that Smith & Nephew has filed with the U.S. Securities and Exchange Commission under the U.S. Securities Exchange Act of 1934, as amended, including Smith & Nephew's most recent annual report on Form 20F, for a discussion of certain of these factors.

All forward-looking statements in this press release are based on information available to Smith & Nephew as of the date hereof. All written or oral forward-looking statements attributable to Smith & Nephew or any person acting on behalf of Smith & Nephew are expressly qualified in their entirety by the foregoing. Smith & Nephew does not undertake any obligation to update or revise any forward-looking statement contained herein to reflect any change in Smith & Nephew's expectation with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

References

    1. Jones, KR PhD. Why do chronic venous leg ulcers not heal? Journal of
       Nursing Care Quality 2009; 24(2): 116-124.
    2. Stacey, M et al. The use of compression therapy in the treatment of
       venous leg ulcers: a recommended management pathway. EWMA 2002;
       2(1):9-13.
    3. Moffatt CJ, McCullagh L, et al.  Randomized trial of four-layer and
       two-layer bandage systems in the management of chronic venous ulceration.
       Wound Repair and Regeneration 2003; 11(3): 166-171.
    4. Moffat CJ, Franks M, Simon, DA et al. Randomized trial comparing two four
       layer bandage systems in the treatment of venous leg ulceration.
       Phlebology 1999; 14 (4); 139-142.
    5. Carr L et al. Comparative cost-effectiveness of four-layer bandaging in
       the treatment of venous leg ulceration. Journal of Wound Care 1999; 8(5):
       243-248.
    6. O'Meara et al. Four layer bandage compared with short stretch bandage for
       venous leg ulcers: systematic review and meta-analysis of randomized
       controlled trials with data from individual patients.  British Medical
       Journal, 2009; 338; b1344; 1-9

    7. Partsch H. Understanding the pathophysiological effects of compression.
       Understanding compression therapy. EWMA Position Document, Medical
       Education Partnership Ltd. 2003: 2-4 (EXPECT Study).

SOURCE Smith & Nephew, Inc.

http://www.smith-nephew.com

At September 30, 2009, NUCRYST had $13.4 million in cash and cash equivalents, compared to $23.4 million at December 31, 2008. In the first quarter of 2009, NUCRYST completed a $14.7 million, or $0.80 per share, cash distribution to NUCRYST shareholders.

On November 10, 2009, NUCRYST announced that it had entered into a definitive agreement to sell to subsidiaries of Smith & Nephew plc ("Smith & Nephew") substantially all of NUCRYST's operations and assets including all rights to its proprietary nanocrystalline silver technology for cash consideration of $21 million plus the carrying book value of working capital, subject to certain adjustments (the "Sale Transaction"). NUCRYST also entered into an amalgamation agreement with The Westaim Corporation ("Westaim"), which currently owns approximately 75% of NUCRYST's outstanding common shares. Under the amalgamation agreement, NUCRYST will amalgamate with a newly formed subsidiary of Westaim to form Amalco, and NUCRYST shareholders other than Westaim will receive for each NUCRYST share one redeemable preferred share in the capital of Amalco, which share will be redeemed for $1.77 in cash upon the closing of the amalgamation (the "Amalgamation"). Both transactions are subject to closing conditions, including the approval by NUCRYST shareholders. The details regarding these transactions will be included in a NUCRYST management information circular, which is expected to be mailed to shareholders in late November 2009 for a shareholders meeting to be held in December 2009.

Third quarter financial analysis

NUCRYST's total revenue for the third quarter of 2009, which consists of wound care product revenues less the manufacturing cost rebate, increased to $6.1 million compared to $5.3 million in the third quarter of 2008. The increase was due to a higher level of product shipments in the current quarter which was partially offset by slightly lower royalty revenues on Acticoat(TM) sales reported by Smith & Nephew plc. Smith & Nephew's reported Acticoat(TM) sales were negatively impacted by the strengthening U.S. dollar.

Gross margin on product revenues was 51% in the third quarter of 2009, compared to 47% in the third quarter of 2008. The improvement was primarily due to reductions in per unit manufacturing costs which were partially offset by a decrease in manufacturing prices charged to Smith & Nephew. NUCRYST recognizes manufacturing revenue when NUCRYST ships product to Smith & Nephew and recognizes royalty income when Smith & Nephew sells Acticoat(TM) products to its customers. Consequently, NUCRYST's gross margin percent may vary from period to period due to differences in the timing of product shipments to Smith & Nephew and the sale of that product by Smith & Nephew to its customers.

Research and development spending in the third quarter of 2009 totaled $0.5 million compared to $1.1 million in third quarter of 2009. NUCRYST completed the closure of its Wakefield, Massachusetts research operations in the fourth quarter of 2008. NUCRYST has also eliminated spending on several development programs in order to reduce costs.

General and administrative costs in the third quarter of 2009 totaled $1.6 million compared to $2.0 million in the third quarter of 2008. The decrease was primarily due to cost reductions achieved following the transfer of the Company's U.S. headquarters to Princeton, New Jersey and a reduction in administrative staff. The decline in the Canadian dollar relative to the U.S. dollar on a year- over year basis also contributed to overall decrease in reported costs.

Other income and expenses, which includes foreign exchange gains and losses and interest income, was a net loss of $0.5 million for the third quarter of 2009 as compared to a net gain of $0.5 million in the third quarter of 2009. Changes in the U.S. dollar and Canadian dollar exchange rate during the third quarter of 2009 resulted in unrealized currency losses on our U.S. dollar working capital amounts held by our Canadian operations. All of our revenues from Smith & Nephew are received in U.S. dollars.

                         (Financial Table Page Below)

About NUCRYST Pharmaceuticals Corp.

NUCRYST Pharmaceuticals Corp. (NASDAQ: NCST; TSX: NCS) develops, manufactures and commercializes medical products that fight infection and inflammation using SILCRYST(TM), its patented atomically disordered nanocrystalline silver technology. NUCRYST licensed world-wide rights for SILCRYST(TM) wound care coating products to Smith & Nephew plc, which markets these products in over 30 countries under their Acticoat(TM) trademark. NUCRYST has developed its proprietary nanocrystalline silver in a powder form, referred to as NPI 32101, for use in medical devices and as an active pharmaceutical ingredient.

A more detailed discussion of NUCRYST's 2009 third quarter results will be available in our Quarterly Report on Form 10-Q for the quarter ended September 30, 2009 which will be available at www.sec.gov and www.sedar.com when filed. NUCRYST filings are also available at www.nucryst.com/Regulatory_Filings.htm.

All amounts in U.S. dollars

SILCRYST(TM) is a trademark of NUCRYST Pharmaceuticals Corp.

Acticoat(TM) is a trademark of Smith & Nephew plc

The financial results in this news release are unaudited, and are not a complete disclosure of our quarterly or results. This news release contains forward-looking statements within the meaning of securities legislation in the United States and Canada (collectively "forward-looking statements"). Forward-looking statements in this news release include, but are not limited to, statements about: our strategy, future operations, prospects and plans of management and our ability to achieve operating efficiencies and cost reductions. With respect to the forward-looking statements contained in this news release, readers are cautioned that numerous risks, uncertainties and other factors could cause our actual results to differ materially from those indicated in these statements including, but not limited to: future shareholder actions with respect to the proposed Sale Transaction, the Amalgamation, our capitalization or strategic direction; the failure to satisfy or waive any conditions to closing of the Sale Transaction or the Amalgamation; the intervention of other events that result in any delay in completing or the failure to complete the Sale Transaction or the Amalgamation; the performance of the stock markets generally; our ability to satisfy regulatory and stock exchange standards and requirements to complete the Sale Transaction or the Amalgamation; the uncertainty of our future operating results, which are likely to fluctuate and could under certain conditions prevent the completion of the Sale Transaction or the Amalgamation; our reliance on and ability to maintain our collaboration with Smith & Nephew should the proposed Sale Transaction not be completed; our reliance on sales of Acticoat(TM) products with our SILCRYST(TM) coatings by Smith & Nephew; changes in regulation or tax laws applicable to us; changes in general economic and capital market conditions; other risks and uncertainties that have not been identified at this time; and management's response to these factors. Although we have attempted to identify the important risks, uncertainties and other factors that could cause actual results or events to differ materially from those expressed or implied in the forward-looking statements in this release, there may be other factors that cause actual results or events to differ from those expressed or implied in forward looking statements. For a more thorough discussion of the risks associated with our business, see the "Risk Factors" section in our Annual Report on Form 10-K for the year ended December 31, 2008 and in our Quarterly Report on Form 10-Q for the quarter ended September 30, 2009, once filed with the U.S. Securities and Exchange Commission on EDGAR at www.sec.gov and with securities authorities in Canada on SEDAR at www.sedar.com. All forward-looking statements are expressly qualified in their entirety by this cautionary statement and NUCRYST disclaims any intention or obligation to revise or update any forward-looking statements whether as a result of new information, future developments or otherwise after the date hereof.

    Condensed Consolidated Statements of Operations
    -----------------------------------------------

                               Three Months Ended        Nine Months Ended
                                  September 30              September 30
                                 2009         2008         2009         2008
                          ------------ ------------ ------------ ------------

    Revenue                $    6,080   $    5,253   $   15,171   $   15,150
                          ------------ ------------ ------------ ------------
    Operating expenses:
      Cost of goods sold        2,998        2,799        8,032        9,625
      Research and
       development                475        1,073        1,823        4,023
      General and
       administrative           1,644        2,020        5,623        6,672
                          ------------ ------------ ------------ ------------
        Total operating
         expenses               5,117        5,892       15,478       20,320
                          ------------ ------------ ------------ ------------
    Income/(Loss) from
     operations                   963         (639)        (307)      (5,170)
      Other income/
       (expenses)                (470)         581         (689)       1,218
                          ------------ ------------ ------------ ------------
    Net pre-tax loss              493          (58)        (996)      (3,952)
      Income tax expense            -            9            -           11
                          ------------ ------------ ------------ ------------
                          ------------ ------------ ------------ ------------

    Net loss               $      493   $      (67)  $     (996)  $   (3,963)
                          ------------ ------------ ------------ ------------
                          ------------ ------------ ------------ ------------

      Basic and diluted
       net loss per common
       share               $     0.03   $    (0.00)  $    (0.05)  $    (0.22)
                          ------------ ------------ ------------ ------------
                          ------------ ------------ ------------ ------------

      Dilutive weighted
       average common
       shares outstanding  18,368,819   18,376,631   18,322,279   18,370,708
                          ------------ ------------ ------------ ------------
                          ------------ ------------ ------------ ------------


    Selected Consolidated Balance Sheet Data
    ----------------------------------------

                                                   September 30  December 31
                                                           2009         2008
                                                    ------------ ------------
    Cash and cash equivalents                        $   13,414   $   23,388
    Current assets                                       22,678       31,751
    Total assets                                         33,186       41,800
    Current liabilities                                   7,119        2,949
    Non-current liabilities                                 488          495
    Shareholders' equity                                 25,579       38,356

SOURCE NUCRYST Pharmaceuticals Corp.