KING OF PRUSSIA, Penna. - August 5, 2005 - MDS Pharma Services (www.mdsps.com) has acquired SkeleTech Inc. of Bothell, Washington. SkeleTech (www.skeletech.com) is a therapeutically focused contract research organization providing pre-clinical discovery and development services in bone and central nervous system (CNS) biologies. This strategic acquisition strengthens MDS capabilities in preclinical research and reflects their commitment to offer the most innovative technologies in this market space.

The SkeleTech library of bone and CNS biology assays is an excellent addition to the pharmacology services MDS Pharma Services currently offers. MDS already offered one of the industry's most extensive array of biochemical, cellular, tissue and organ assays. The acquisition of SkeleTech’s expertise will enable the combined groups to offer an even wider range of scientific and technical services for model development and efficacy testing to pharmaceutical, biotechnology and medical device customers.

Founded in February 1997 by Steven Bain, Ph.D. and Christopher Jerome, B.Vet.Med., Ph.D, SkeleTech is located Bothell, Washington. The company was funded by Frazier Healthcare Ventures and Orca Bay Partners. With this acquisition, MDS broadens their offering to existing clients and gaining the ability to serve a wider range of clients. The acquisition should drive MDS position in pharmacology services and allow them to continue to be a leader in terms of innovation.

Fairmount Partners, a leading investment bank serving life sciences, represented SkeleTech, and assisted the company and its shareholders in initiating, negotiating and closing the transaction.