Atossa Genetics

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Preventing Breast Cancer by Measuring & Eliminating Risk

The Breast Health CompanyNASDAQ: ATOS1Forward Looking StatementThis presentation has been prepared by Atossa Genetics, Inc. (the Company) as of December 5, 2012. It should not be considered as an offer or invitation to subscribe for or purchase any securities in the Company or as an inducement to make an offer or invitation with respect to those securities. It has been prepared for information purposes only. This presentation contains general summary information and does not take into account the investment objectives, financial situation and particular needs of any individual investor. It is not investment advice and prospective investors should obtain their own independent advice from qualified financial advisors having regard to their objectives, financial situation and needs.

Certain statements contained herein, including, without limitation, statements containing the words believes, intends and other words of similar import, constitute forward-looking statements within the meaning of section 7a of the Securities Act of 1933, as amended, and section 21e of the Securities Exchange Act of 1934, as amended. Such statements involve risks and uncertainties that could cause actual results to differ materially from projected results. Accordingly, investors should not place undue reliance on forward-looking statements as a prediction of actual results. The forward-looking statements may include projections and estimates, the timing and success of specific projects and our future operating results and financial condition. When we use the words "will," "believe," "intend," "expect," "may," "should," "anticipate," "could," "estimate," "plan," "predict," "project," or their negatives, or other similar expressions, the statements which include those words are usually forward-looking statements. When we describe strategy that involves risks or uncertainties, we are making forward-looking statements. The forward-looking statements in this presentation, if any, speak only as of the date of this presentation; we disclaim any obligation to update these statements. We have based these forward-looking statements on our current expectations and assumptions about future events. While our management considers these expectations and assumptions to be reasonable, they are inherently subject to significant business, economic, competitive, regulatory and other risks, contingencies and uncertainties, most of which are difficult to predict and many of which are beyond our control. Neither the delivery of this presentation nor any further discussions by the Company or its representatives with any of the recipients shall, under any circumstances, create any implication that there has been no change in the affairs of the Company since such date. This document contains confidential and proprietary information. Unauthorized possession, use or disclosure of the enclosed information is strictly prohibited and will be prosecuted under all applicable state and federal laws.

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The Breast Cancer EpidemicMost-feared disease among womenIn US, 235,000 new cases per year30 new cases every hour, 24/7Treatment >$13 billion per yearDoesnt happen overnight10-year reversible process, if identified early (earlier than mammography)3

Breast Cancer and the Sick Lobe Two breasts: 14 lobe-duct unitsHyperplasia in one lobe-duct starts 10-year march to cancerEven if remaining 13 ducts are completely normal!Hyperplasia is fully reversible until the final stage

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How Atossa Prevents Breast CancerFind high-risk women who have sick lobes

Find the sole sick lobe

Treat only the sick lobe (not entire patient) with intraductal therapy to eliminate hyperplasia

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Finding the Sick Lobe"Patented, FDA-cleared medical device and laboratory test developed over 14 yearsAtossa can test 110M women, 18 to 73, to find high-risk women with sick lobes (reversible hyperplasia)Launched 1H 2012 at $500 per patient $55 billion TPM

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ForeCYTE Breast Health TestFDA-cleared, non-invasive biopsy deviceMade in the USA CLIA-certified testLaunched Dec 201117 patentsDevice revenue:$30/patientTest revenue: $500/patient

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How ForeCYTE Works

AcellularCategory 0Category ICategory IICategory IIICategory IVMicroscopic ResultsFamily history ofBreast cancerPersonal Reproductive History

Developed from a registry of 158,041 women in whom 3,257 breast cancers occurredIBIS Risk Algorithm8Atossa Revenue ModelBreast Pump and Kit Sales to DoctorsSampling Kit Sales to DoctorsLaboratory Analysis with Report Generation

10-year March to CancerReversible HyperplasiaCancerNormal9

2. Finding the Sole Sick LobePatented, FDA-cleared device and test, developed over 14 years; $50M+ R&DFind sick lobes in 10M high-risk women1H 2013 launch at $3500/patient

$35 billion TPM

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FullCYTE Microcatheter System FDA-cleared microcatheter finds the sole sick lobe and the six normal ducts19 issued US patentsMicrocatheter revenue: $700/patientLaboratory Revenue: $3500/patient

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Acueity HC DuctoscopeAcquired Q3 2012Breast endoscopeBiopsy tools and accessoriesSix FDA-cleared medical devices35 issued and 41 pending patentsLaunch 2H 2013

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Treatment3. Treat only the Sick Lobe (not the entire patient) to Eliminate HyperplasiaPatented intraductal treatment with positive clinical data published Oct 2012Initial market: adjunct to Ductal Carcinoma in Situ surgery66,000 per year2H 2013 clinical trials begin

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Atossa Devices & Tests

FDA-cleared, patented medical devicesCLIA-certified, patented Laboratory Developed Tests

ServiceRevenue

ProductRevenue123414

Atossa Devices & Laboratory Tests

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Early ForeCYTE Adoption:> $20K Revenue/MD/yearRevenue X 1000GrossProfit92%16

Co-Marketing & Sales PlanDiagnostic Testing Group50+ years experience laboratory diagnosticsBranded Clarity Diagnostics provides immediate office and clinic recognitionCo-marketing24 direct national sales repsExtensive GPO contractsContract with national distributorswith >5,000 ISRGoal: 33,000 Ob-Gyn customers

Rudov: In every slide, I, the investor, have one question: How will this make me money? The most important point you must make is that 5,000 salesreps will call on 30,000 doctors (what kind of doctors?), who will buy the Atossa NAFerator instantly because..(tell us why). This will lead to $M in revenues by 2013.17

ForeCYTE Launch Team:5,000 Strong

18Atossa Revenue ModelSampling Kit Sales to DoctorsLaboratory Analysis with Report Generation

Reimbursement

In general, currently out-of-networkMultiplan Contract speeds revenueAtossas first payer contract20% of Americans covered by planReimbursement at 90+% of list price; payment within 30 days

A steppingstone to in-network contracts over next 24 months

19Family History: No CancerFamily history: CancerLow Risk CytopathologyExpected resultsBiopsy-based ReassuranceHigh Risk CytopathologyBiopsy-based ConcernExpected ResultsCare Path Business Model

The Atossa Cancer Prevention PlanUS women age 18 to 73at risk of breast cancerNormal Risk0 to 15%Intermediate Risk15 to 20%High Risk>20%

Intraductal Treatmentto prevent cancerMicrocatheterSystem20Care Path Business Model

Intellectual PropertyFDA Medical Device Market Authorizations11 510(k)-cleared and two 510-exempt medical devicesCLIA-certified Laboratory Developed TestsFour validated testsPatents>179 issued patents (56 in US & 123 foreign)50 pending applicationsTrademarksOne registered and seven pending21Family History: No CancerFamily history: CancerLow Risk CytopathologyExpected resultsBiopsy-based ReassuranceHigh Risk CytopathologyBiopsy-based ConcernExpected ResultsCare Path Business Model

The Atossa Breast Health Care PathUS women age 18 to 73at risk of breast cancerNormal Risk0 to 15%Intermediate Risk15 to 20%High Risk>20%Newly DiagnosedBreast CancerBreast Cancer Survivors

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Two Diagnostics for CancerLocal diseaseSystemic disease

23Family History: No CancerFamily history: CancerLow Risk CytopathologyExpected resultsBiopsy-based ReassuranceHigh Risk CytopathologyBiopsy-based ConcernExpected ResultsCare Path Business Model

The Atossa Breast Health Care PathUS women age 18 to 73at risk of breast cancerStratify110 MMNormal Risk0 to 15%Intermediate Risk15 to 20%High Risk>20%Assess10 MMNewly DiagnosedBreast CancerBreast Cancer SurvivorsProfileMonitor0.2 MM2.9 MM24Management TeamFamily History: No CancerFamily history: CancerLow Risk CytopathologyExpected resultsBiopsy-based ReassuranceHigh Risk CytopathologyBiopsy-based ConcernExpected ResultsCare Path Business Model

Management TeamCEOSteven C Quay, MD, PhD, FCAPCFOChristopher BenjaminCSOShu-Chih Chen, PhDVP Marketing & SalesTBD in December 2012OperationsMichael Malafronte25Management TeamFamily History: No CancerFamily history: CancerLow Risk CytopathologyExpected resultsBiopsy-based ReassuranceHigh Risk CytopathologyBiopsy-based ConcernExpected ResultsCare Path Business Model

Board of DirectorsSteven Quay, ChairmanJohn Barnhart: Former Disney ExecutiveShu-Chih Chen, PhDAlexander Cross, PhD: Former Syntex ExecutiveStephen Galli, MD: Chairman, Stanford Pathology DepartmentLawrence Remmel, Esq: Securities Atty (early-stage healthcare company financing expertise)26

Key Financial MetricsRevenue: $273K (1H 2012)Gross Profit: $233K (1H 2012)Gross profit margin of 92%!Total Op Expenses: $2.5M (1H 2012)Monthly burn rate (1H 2012) ~ $370KShareholder Equity: $3.9M (adjusted, 06.30.12 )Accumulated Deficit (04.09 06.12): $6.9MShares Outstanding: 12.1M common; no preferred; 7.2M warrants at $1.56 per share

27Management TeamFamily History: No CancerFamily history: CancerLow Risk CytopathologyExpected resultsBiopsy-based ReassuranceHigh Risk CytopathologyBiopsy-based ConcernExpected ResultsCare Path Business Model

2013 MilestonesQ1ForeCYTE National launchNextCYTE development advancementQ2ArgusCYTE national launchFullCYTE national launchQ3Intraductal treatment program initiates pre-clinical toxicology workQ4Intraductal treatment program initiates clinical trials28

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