Health Sciences Group to Acquire Exclusive Rights for Patented Nanotechnology Product; Proprietary Nutraceutical Product Expected to Boost Sales

LOS ANGELES, May 12, 2004 (BUSINESS WIRE) -- Health Sciences Group, Inc. (HESG) , an integrated provider of innovative, science-based products and bulk ingredients to customers in the nutrition, skin care, and food and beverage industries, today announced that it has entered into an agreement to acquire exclusive rights to market and sell a CoQ10 supplement which utilizes a patented nanotechnology to improve delivery and absorption. The Company expects to market its product under the name NanoFlow(TM) CoQ10.

CoQ10 is a lipid-soluble compound found in the mitochondria of all living cells. It is a powerful antioxidant that is essential in the production of cellular energy and has been clinically shown to support healthy heart function, regulate blood pressure, increase energy and vitality, fight off free radicals and enhance the immune system.

While it is endogenously produced in the liver, there are conditions in which adequate production of CoQ10 in the body is impaired. In such situations, supplementation of CoQ10 has been shown to be very beneficial. However, many currently available dosage forms of CoQ10 exhibit negligible dissolution properties indicating potentially poor bioavailability thereby limiting the therapeutic effect.

"In measuring the effectiveness of any CoQ10 product, the key is not how much CoQ10 one is consuming," said Fred E. Tannous, Co-chairman and CEO of Health Sciences Group. "But rather, how much CoQ10 is actually being absorbed into the bloodstream. The NanoFlow(TM) process not only renders CoQ10 soluble, but also significantly enhances its bioavailability, therefore reducing the amount of CoQ10 required to achieve an equivalent therapeutic outcome when compared with most other dosage forms."

Clinical studies carried out in human subjects at the Weitzman Institute in Israel compared the relative bioavailability of NanoFlow(TM) CoQ10 with other currently available dosage forms. The results demonstrated that NanoFlow(TM) CoQ10 is vastly superior, exhibiting a six-fold increase in plasma CoQ10 values over baseline and several-fold greater relative bioavailability over other dosage forms tested.

NanoFlow(TM) CoQ10 is produced by an innovative process developed to improve the dissolution and absorption profile of CoQ10. By employing a patented nanoemulsion technology, the NanoFlow(TM) process results in a free-flowing powder of CoQ10 with a 100% dissolution rate. When compared with other commercially available dosage forms, in addition to having superior bioavailability characteristics, the free-flowing powder form offers greater manufacturing versatility and flexibility.

"We're excited to have the exclusive rights for this patented CoQ10 nanotechnology," said Bill Glaser, Co-chairman and President of Health Sciences Group. "CoQ10 is an increasingly popular nutritional supplement with a US market size approaching $500 million and growing. We expect to increase our revenues from sales of this and other clinically-supported, proprietary products to our customers. We believe NanoFlow(TM) CoQ10 has the potential to be a big winner for us."

The Company expects to apply NanoFlow(TM) technology to other nutraceutical products including Ginseng, Ginkgo Biloba, Saw Palmetto, and St. John's Wort.

About Health Sciences Group, Inc.

Health Sciences Group, Inc. is an integrated provider of innovative products and services in the nutraceutical, pharmaceutical, and cosmeceutical industries offering value-added ingredients, bioactive formulations, and proprietary technologies used in nutritional supplements, functional foods and beverages, and skin care products. Its largest division, Quality Botanical Ingredients, Inc. (QBI), processes more than 500 herbs, dried fruits and vegetables, and nutraceuticals using cryogenic (cold) processing at its New Jersey facility. Its XCEL Healthcare division is a fully licensed, specialty compounding pharmacy delivering full service pharmacology solutions to customers with chronic ailments that require long-term therapy; and its BioSelect Innovations division develops and sells innovative, science-based products based on proprietary technologies in the areas of topical/transdermal drug delivery, cosmeceuticals, and integrative medicine to a global network of customers who manufacture and distribute compounded pharmaceuticals, functional foods and beverages, skin care products and cosmetics. For more information, visit

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Act of 1934 that are based upon current expectations or beliefs, as well as a number of assumptions about future events. Although the Company believes that the expectations reflected in the forward-looking statements and the assumptions upon which they are based are reasonable, it can give no assurance that such expectations and assumptions will prove to have been correct. The reader is cautioned not to put undue reliance on these forward-looking statements, as these statements are subject to numerous factors and uncertainties, including without limitation, the independent authority of the special committee to act on the matters discussed, the successful negotiation of the potential acquisition and disposal of transactions described above, successful implementation of the company's business strategy and competition, any of which may cause actual results to differ materially from those described in the statements. In addition, other factors that could cause actual results to differ materially are discussed in the Company's most recent Form 10-QSB and Form 10-KSB filings with the Securities and Exchange Commission.

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