Company Presentation

www.spectrascience.com

Forward looking statements

This presentation may contain predictions, estimates and other forward-looking statements. Our use of the words “estimate”, “project” and similar expressions is intended to identify these statements. These statements represent our current judgment on what the future holds. While we believe them to be reasonable, these statements are subject to risks and uncertainties that could cause actual results to differ materially as a result of certain factors, including those set forth in the Company’s 10KSB and 10QSB filings with the Securities and Exchange Commission.

Proceedings Today

• Formal resolutions

• CEO’s address

• Q & A

Transforming the business

• Moving from R&D to commercialization

• Recent funding provides capital to deepen sales and marketing, expand operations and increase inventory

• Taking proactive stance toward the public markets

Highlights

• LUMA acquisition• EU certification• Established initial distribution in EU• Initial WavSTAT® sale in EU• Closed financing of $5.5M• Upgraded WavSTAT with new technology• Re-started Barrett’s study• Expanded sales force• Sought further FDA approvals• Strengthened Board

Creating a Leading Cancer Detection Company

• 85% of all cancers begin in the epithelial layer

• FDA approved for detecting colon/cervical cancer;

– approval for esophageal cancer expected in 2008 (PMA supplement)

– Sales in EU before FDA approval.

– FDA approved for detecting pre-cervical cancer

• Instantaneous detection (decreases procedure time)

• Treatment possible at point-of-care (decreases number of

visits)

Innovation

Endoscopy/Colonoscopy (Today’s Gold Standard)_

Limited to White Light Visualization

TISSUE

Gastrointestinal/Tissue Penetration

Disease originates at the lowest level of the epithelial tissue_

20-30 Cell Layers Deep

Laser Florescence

Fluorescence Excitation at 337nm_WavSTAT

The SolutionWavSTAT® Optical Biopsy Device and Forceps

Diagnostic: WavSTAT optical biopsy console generates and sends Laser light through optical fiber, reads reflected light and makes cancer determination.

Therapeutic: forceps deployed through scope center channel -biopsies AND removes tissue in same procedure

What is an Optical Biopsy?

• Pre-cancer cells reflect light differently vs. normal cells. The difference is what we detect.

• WavSTAT display gives instant absolute answer:

– GREEN = normal

– RED = suspect

• Determine margin (edge) of disease

• Can remove tissue immediately with forceps

WavSTAT Advantages

• Reduced procedure time

• Reduced cost of care

• Additional MD revenue

• Improved patient outcomes

– Patient goes home with peace of mind - no waiting for pathology

– If positive – sent directly to surveillance or oncologist

– Esophageal* - low pain versus present method**InvestigationalInvestigational

Fast, accurate early detection and ability to treat/biopsy in situ

Esophageal Cancer

• 2 million screenings per year

• Growing 5X faster than other cancers

• Particularly high incidence in Asia

• Very difficult to visualize and diagnose

• Over 90% mortality rate

Esophageal CancerStages of Disease Progression

GERD* (“Heart-burn”)

Barrett’s esophagus

Low-grade dysplasia

High-grade dysplasia

Esophageal cancer

Weekly occurrence in 60M Americans; daily in 20M

10% of patients with chronic heartburn

20% of Barrett’s patients

WavSTAT begins

detecting here **

3% of LGD patients progress to HGD

17% of HGD pts

*Gastroesophageal reflux disease** Investigational

• Random physical biopsy in four quadrants

• Up 2cm…do it again…; Up 2cm…do it again. Could be as many as 16-20 vs. as low as none optically

• Hope specialist biopsies correct spot and hope pathologist accurately interprets what might be cancerous

Limitations of current diagnostic procedure

Esophageal Cancer

Colon Cancer

• Second most common cancer diagnosed in US

• 149,000 diagnosed and 55,000 deaths annually

• All persons over 50 at risk

• Expected to increase 20% over next 10 years

• 92% of patients “cured” if cancer detected early

Cervical cancer

• Second most common malignancy in women world-wide

• A National study showed 200,000 women are sent home by their physicians each year with pre-cancer – and don’t know it!

• Abnormal Pap test requires colposcopy• Colposcopy is subjective – depends on training• LUMA is objective, accurate, a permanent

record and directs the biopsy target

LUMA® Cervical Imaging SystemLUMA LUMA

Colposcopist/LUMA view cervix

LUMA Control Panel

Obstetrics & Gynecology Ad

Obstetrics & Gynecology Ad

Sales/Marketing Strategy

• Direct sales force to sell to physicians and group practices

• Start with thought-leaders and expand from there

• Work with Patient Advocacy Groups

• Begin integration with Managed Care Networks

Intellectual Property • Exclusive rights to sixty issued and pending

U.S. and international patents

• All patents cover various aspects of the WavSTAT & LUMA Systems, methods for tissue diagnosis and our disposables

• New non-endoscopic patent filed

• Exclusive licensee of an additional patent from Massachusetts General Hospital

Board of Directors

• Jim Hitchin• Mark McWilliams• Rand Mulford• John Pappajohn• Stan Pappelbaum• Tommy Thompson• Chet Sievert

– (Steve Watson)

Investment Highlights

• Robust Recurring Revenue Model

– Company intends to sell or charge on a per use basis for diagnostic testing

– Disposable/reusable optical probe/forceps offer a second major revenue stream

– Company will have compelling cost-effectiveness data to push for additional CPT codes

• Strong Management/Board Team

– Extensive experience in Operations, Research & Development, Sales & Marketing, Engineering, Regulatory and Business Development

– Experience establishing O.E.M. arrangements and building co-marketing partnerships

– Extensive experience in medical device industry

Investment Highlights

• Large Market Opportunity

– Esophagus >2M annual procedures in US; $850M US/EU diagnostic potential + $250-$650M for disposable/reusable for esophagus alone – multi-billion markets for other areas of cancer

– Asian market much higher potential

– Opportunity for rapid growth given no competition in definitive in situ diagnostics

• Clinically-Proven Non-Invasive Technology Platform

– Successful and statistically significant (96%) studies in hundreds of patients for colon cancer

– Significant successful study for esophagus completed (95%)

– Published reports show >26% more pre-cancers found in cervix

– Extensive new uses possible – lung, oral, prostate, urinary/bladder, etc.

• Strong Intellectual Property Position

– 60 patents issued or pending- cover BOTH WavSTAT and LUMA Systems and Probe/Forceps

– Patent license with Mass General

Going Forward

• We have laid the foundation for transition to a full operating company

• Finish Barrett’s study & file with FDA• Begin selling Barrett’s in the EU• Selling LUMA partnering program• Complete colon study in managed care• Begin and complete lung study

www.spectrascience.com