Randy Hill Joins Vasomedical to Lead VasoHealthcare

A veteran in the medical device industry, Mr. Hill was, until May 2011, interim Chief Executive Officer of Siemens Healthcare USA, the U.S. organization of the healthcare sector of Siemens AG (NYSE:SI), a German multinational conglomerate, where he was responsible for sales, marketing, service, and logistics across the Siemens Healthcare portfolio, including medical imaging equipment, healthcare information technology and medical therapy. For several years prior to that, Mr. Hill was Chief Operating Officer of Siemens Healthcare USA, responsible for setting and implementing national strategies to sell Siemens products and services, and achieving synchronization across Siemens Healthcare’s U.S. Business Management and Solutions Implementation teams. In addition to his career at Siemens Healthcare spanning several decades in a wide range of roles with many different responsibilities, Randy, as a recognized leader in the medical imaging business, is also former Chair of the Board of Medical Imaging & Technology Alliance (MITA), the leading organization and collective voice of medical imaging equipment manufacturers, innovators, and product developers, representing companies whose sales comprise more than 90 percent of the global market for medical imaging technology.

“Alternative sales channels are an effective sales strategy for any national or global manufacturer to achieve broad and sustainable success, and VasoHealthcare is a leading organization that has excelled in this field with a great performance track record,” commented Mr. Hill upon accepting the position. “I am very excited about joining the leadership at Vasomedical and leading an exceptional team of sales professionals at VasoHealthcare. I look forward to working with this young, energetic team towards growing the relationship with GE Healthcare to better serve our customers.”

Welcoming Mr. Hill to Vasomedical and VasoHealthcare, Dr. Jun Ma, President and CEO of Vasomedical, stated, “We are thrilled to have such a successful industry leader like Randy Hill as part of our leadership team. Randy’s in-depth knowledge of the diagnostic imaging business and broad understanding of the medical device industry will be an invaluable asset to VasoHealthcare and Vasomedical. I look forward to his advice in many aspects of our business and am confident that he will play a significant role in further development of our company to achieve its full potential.”

About Vasomedical

Vasomedical, Inc. is a diversified medical technology company specializing in the manufacture and sale of medical devices and in the domestic sale of diagnostic imaging products. The Company operates through three wholly-owned subsidiaries. Vasomedical Solutions manages and coordinates the design, manufacture and sales of EECP^® therapy systems, its core product, as well as other medical equipment operations; Vasomedical Global operates the Company’s China-based subsidiaries; and Vaso Diagnostics, d/b/a VasoHealthcare, is the operating subsidiary for the sales representation of GE Healthcare diagnostic imaging products. Additional information is available on the Company’s website at www.vasomedical.com.

Except for historical information contained in this release, the matters discussed are forward-looking statements that involve risks and uncertainties. When used in this release, words such as “anticipates”, “believes”, “could”, “estimates”, “expects”, “may”, “plans”, “potential” and “intends” and similar expressions, as they relate to the Company or its management, identify forward-looking statements. Such forward-looking statements are based on the beliefs of the Company’s management, as well as assumptions made by and information currently available to the Company’s management. Among the factors that could cause actual results to differ materially are the following: the effect of business and economic conditions; the effect of the dramatic changes taking place in the healthcare environment; the impact of competitive procedures and products and their pricing; medical insurance reimbursement policies; unexpected manufacturing or supplier problems; unforeseen difficulties and delays in the conduct of clinical trials and other product development programs; the actions of regulatory authorities and third-party payers in the United States and overseas; uncertainties about the acceptance of a novel therapeutic modality by the medical community; continuation of the GEHC agreement; and the risk factors reported from time to time in the Company’s SEC reports. The Company undertakes no obligation to update forward-looking statements as a result of future events or developments.

The amendment, effective July 1, 2012, extends the initial term of three years commencing July 1, 2010 to five years through June 30, 2015, subject to earlier termination under certain circumstances. Under the agreement, VasoHealthcare is the exclusive representative for the sale of select GE Healthcare Diagnostic Imaging products to specific market segments in the 48 contiguous states of the United States and the District of Columbia.

“The extension of the agreement is verification of the professionalism, dedication and performance of our VasoHealthcare sales team” commented Jun Ma, President and CEO of Vasomedical, Inc. “The start of the sales representation business two years ago is part of the diversification strategy of the company, which also includes our expanded international operations and new product lines. We continue to look for accretive acquisitions as well as other related opportunities in the medical device business, with the objective of enhancing our business and increasing shareholder value.”

About Vasomedical

Vasomedical, Inc. is a diversified medical technology company specializing in the manufacture and sale of medical devices and in the domestic sale of diagnostic imaging products. The Company operates through three wholly-owned subsidiaries. Vasomedical Solutions manages and coordinates the design, manufacture and sales of EECP^® therapy systems, its core product, as well as other medical equipment operations; Vasomedical Global operates the Company’s China-based subsidiaries; and Vaso Diagnostics, d/b/a VasoHealthcare, is the operating subsidiary for the sales representation of GE Healthcare diagnostic imaging products. Additional information is available on the Company’s website at www.vasomedical.com.

Except for historical information contained in this release, the matters discussed are forward-looking statements that involve risks and uncertainties. When used in this release, words such as “anticipates”, “believes”, “could”, “estimates”, “expects”, “may”, “plans”, “potential” and “intends” and similar expressions, as they relate to the Company or its management, identify forward-looking statements. Such forward-looking statements are based on the beliefs of the Company’s management, as well as assumptions made by and information currently available to the Company’s management. Among the factors that could cause actual results to differ materially are the following: the effect of business and economic conditions; the effect of the dramatic changes taking place in the healthcare environment; the impact of competitive procedures and products and their pricing; medical insurance reimbursement policies; unexpected manufacturing or supplier problems; unforeseen difficulties and delays in the conduct of clinical trials and other product development programs; the actions of regulatory authorities and third-party payers in the United States and overseas; uncertainties about the acceptance of a novel therapeutic modality by the medical community; continuation of the GEHC agreement; and the risk factors reported from time to time in the Company’s SEC reports. The Company undertakes no obligation to update forward-looking statements as a result of future events or developments.

The Company recorded revenue of $6.04 million for the three month period ended March 31, 2012, compared to revenue of $4.85 million for same period in 2011, an increase of 25%. The increase is primarily due to an increase of $925,000 in EECP^® and other medical equipment sales, or 175%, of which $578,000 was contributed by our recent acquisitions in China. Commission revenue at our wholly-owned subsidiary Vaso Diagnostics, Inc., d/b/a VasoHealthcare, also grew by $317,000, or 8%, for the three month period ended March 31, 2012. We continue to record substantial amounts of deferred revenues, which will be recognized once the underlying equipment or service is accepted or performed. As of March 31, 2012, total deferred revenues were approximately $14.78 million, a decrease of $0.45 million from December 31, 2011. At March 31, 2012, the Company had cash and cash equivalents of approximately $13.3 million.

Net loss for the three months ended March 31, 2012 was $1.34 million, compared to a net loss of $0.47 million for the same period in 2011. The increase in net loss was due to higher selling, general and administrative costs associated mainly with additional sales and marketing investments at our Vaso Diagnostics subsidiary, the addition of the China operations, and increased corporate expenses. Loss attributable to common stockholders was $1.34 million or $0.01 per common share for the three months ended March 31, 2012, compared to a net loss of $0.59 million or $0.01 per common share for the three months ended March 31, 2011.

“We are excited about the revenue growth in both segments but especially with the growth in our equipment segment,” commented Dr. Jun Ma, President and Chief Executive Officer of the Company. “We anticipate that our equipment segment will continue to grow and contribute significantly to our future success,” Dr. Ma continued. “We will continue to seek other opportunities to expand our equipment segment to further diversify our business and to enhance shareholder value.”

About Vasomedical

Vasomedical, Inc. is a diversified medical technology company specializing in the manufacture and sale of medical devices and in the domestic sale of diagnostic imaging products. The Company operates through three wholly-owned subsidiaries. Vasomedical Solutions manages and coordinates the design, manufacture and sales of EECP^® therapy systems, its core product, as well as other medical equipment operations; Vasomedical Global operates the Company’s China-based subsidiaries; and Vaso Diagnostics, d/b/a VasoHealthcare, is the operating subsidiary for the sales representation of GE Healthcare diagnostic imaging products. Additional information is available on the Company’s website at www.vasomedical.com.

Summarized Financial Information

Except for historical information contained in this release, the matters discussed are forward-looking statements that involve risks and uncertainties. When used in this release, words such as “anticipates”, “believes”, “could”, “estimates”, “expects”, “may”, “plans”, “potential” and “intends” and similar expressions, as they relate to the Company or its management, identify forward-looking statements. Such forward-looking statements are based on the beliefs of the Company’s management, as well as assumptions made by and information currently available to the Company’s management. Among the factors that could cause actual results to differ materially are the following: the effect of business and economic conditions; the effect of the dramatic changes taking place in the healthcare environment; the impact of competitive procedures and products and their pricing; medical insurance reimbursement policies; unexpected manufacturing or supplier problems; unforeseen difficulties and delays in the conduct of clinical trials and other product development programs; the actions of regulatory authorities and third-party payers in the United States and overseas; uncertainties about the acceptance of a novel therapeutic modality by the medical community; continuation of the GEHC agreement; and the risk factors reported from time to time in the Company’s SEC reports. The Company undertakes no obligation to update forward-looking statements as a result of future events or developments.

The Company recorded revenue of $23.49 million for the seven month period ended December 31, 2011, compared to revenue of $8.74 million for same period in 2010, an increase of 169%. The increase is primarily due to an increase in commission revenue at our wholly-owned subsidiary Vaso Diagnostics, Inc., d/b/a VasoHealthcare, as its agreement with GE Healthcare, which began mid-year 2010, was in full operation in 2011. We continue to record substantial amounts of deferred revenues, which will be recognized once the underlying equipment or service is accepted or performed. As of December 31, 2011, total deferred revenues were approximately $15.23 million, an increase of $3.31 million from May 31, 2011. As of March 29, 2012, the Company had cash, cash equivalents and short term investments of approximately $13.1 million.

Net income for the seven months ended December 31, 2011 was $5.11 million, compared to a net loss of $2.41 million for the same period in 2010. Income attributable to common stockholders was $3.89 million or $0.03 per common share for the seven months ended December 31, 2011, compared to a net loss of $2.60 million or ($0.02) per common share for the seven months ended December 31, 2010. The net income in 2011 and net loss in 2010 applicable to common stockholders were after reduction for preferred stock dividends of $1.22 million and $191,000 for the seven months ended December 31, 2011 and 2010, respectively. These dividends for preferred stock, all of which were converted to shares of common stock during the reporting period, are noncash items resulting principally from the value of the imbedded beneficial conversion feature in the preferred stock.

“I would like to thank each and every one of our highly professional employees, particularly our VasoHealthcare team, for their contribution to the great performance during such uncertain times in healthcare,” commented Dr. Jun Ma, President and Chief Executive Officer of the Company. “The continued profitability in this reporting period has placed Vasomedical in a stronger financial position, allowing the Company to further implement its growth strategies, globally and domestically,” Dr. Ma continued. “We believe a diversified medtech company is certainly better positioned to provide stability in the business of delivering quality healthcare products to the public, and at the same time provide consistent growth and return on investment for our shareholders.”

About Vasomedical

Vasomedical, Inc. is a diversified medical technology company specializing in the manufacture and sale of medical devices and in the domestic sale of diagnostic imaging products. The Company operates through three wholly-owned subsidiaries. Vasomedical Solutions manages and coordinates the design, manufacture and sales of EECP^® therapy systems, its core product, as well as other medical equipment operations; Vasomedical Global operates the Company’s China-based subsidiaries; and Vaso Diagnostics, d/b/a VasoHealthcare, is the operating subsidiary for the sales representation of GE Healthcare diagnostic imaging products. Additional information is available on the Company’s website at www.vasomedical.com.

Summarized Financial Information

Except for historical information contained in this release, the matters discussed are forward-looking statements that involve risks and uncertainties. When used in this release, words such as “anticipates”, “believes”, “could”, “estimates”, “expects”, “may”, “plans”, “potential” and “intends” and similar expressions, as they relate to the Company or its management, identify forward-looking statements. Such forward-looking statements are based on the beliefs of the Company’s management, as well as assumptions made by and information currently available to the Company’s management. Among the factors that could cause actual results to differ materially are the following: the effect of business and economic conditions; the effect of the dramatic changes taking place in the healthcare environment; the impact of competitive procedures and products and their pricing; medical insurance reimbursement policies; unexpected manufacturing or supplier problems; unforeseen difficulties and delays in the conduct of clinical trials and other product development programs; the actions of regulatory authorities and third-party payers in the United States and overseas; uncertainties about the acceptance of a novel therapeutic modality by the medical community; continuation of the GEHC agreement; and the risk factors reported from time to time in the Company’s SEC reports. The Company undertakes no obligation to update forward-looking statements as a result of future events or developments.

The Company recorded revenue of $9.95 million and $14.28 million for the three and six month periods ended November 30, 2011, respectively, compared to revenue of $3.80 million and $5.08 million for same periods a year ago, an increase of 161.9% and 181.3% for the three and six month periods, respectively . The increase is primarily due to an increase in commission revenue at VasoHealthcare, as the agreement with GE Healthcare, which began mid-year 2010, was in full operation in 2011 and the Company earned higher commission rates in 2011 as a result of achieving certain performance targets. Due to the nature of our commission structure under the agreement with GEHC, we earn progressively higher commission rates as calendar year targets are met. As we achieve these targets the higher commission rates are retroactive to the beginning of the calendar year, and therefore we anticipate earning and recognizing greater revenue in the fourth quarter of the calendar year. We continue to record substantial amounts of deferred revenues, which will be recognized once the underlying equipment or service is accepted or performed. As of November 30, 2011, total deferred revenues were approximately $14.7 million, an increase of $2.6 million and $2.8 million from August 31, 2011 and May 31, 2011, respectively.

Net income for the quarter and six months ended November 30, 2011 was $2.47 million and $816,000, respectively, compared to a net loss of $1.13 million and $3.70 million for the same periods in the prior year. The significant change from net loss to net income is attributable to the increase in commission revenue, as discussed above, offset by the related increase in commission expense. Income attributable to common stockholders was $1.33 million or $0.01 per common share for the three months ended November 30, 2011, compared to a net loss of $1.26 million or ($0.01) per common share for the three months ended November 30, 2010. The significant change from net loss to net income is attributable to the increase in commission revenue, as discussed above, offset by the related increase in commission expense. For the six months ended November 30, 2011 net loss attributable to common stockholders was $406,000 or $0.0 per share compared to a net loss applicable to common stockholders of $3.85 million or ($0.03) per share for the same period in the prior year. The net loss applicable to common stockholders is after reduction for preferred stock dividends of $1.14 million and $125,000 for the three months ended November 30, 2011 and 2010, respectively, and $1.22 million and $152,000 for the six months ended November 30, 2011 and 2010, respectively. These preferred stock dividends are noncash items resulting principally from the value of the imbedded beneficial conversion feature in the preferred stock.

“We are very excited by achieving significant record profitability during this reporting period and are gratified with the significant revenue growth from our VasoHealthcare operations,” commented Dr. Jun Ma, Chief Executive Officer and President of Vasomedical. “This result, combined with our recent acquisition of Life Enhancement Technology Ltd. and BIOX Instruments Co. Ltd., gives us a stronger position in the marketplace, enhanced product offerings and positions us to achieve our global vision while enhancing our growth potential,” said Dr. Ma.

About Vasomedical

Vasomedical, Inc. is primarily engaged in designing, manufacturing, marketing and supporting EECP^® external counterpulsation systems based on the Company’s proprietary technology. EECP^® therapy is a non-invasive, outpatient therapy for the treatment of cardiovascular diseases and is currently indicated for use in cases of angina, cardiogenic shock, acute myocardial infarction and congestive heart failure. The Company provides hospitals, clinics and private practices with EECP^® equipment, treatment guidance and a staff training and maintenance program designed to provide optimal patient outcomes. The Company also provides other noninvasive medical equipment including Holter monitors and ambulatory blood pressure monitors.

Vaso Diagnostics d/b/a VasoHealthcare, a wholly owned subsidiary of Vasomedical, Inc., is a professional sales representation organization offering vendors of medical devices an alternative third party sales channel. Through an agreement with GE Healthcare, it is currently engaged as an exclusive sales representative for certain GE Healthcare products. Additional information is available on the Company’s website at www.vasomedical.com.

Summarized Financial Information

Except for historical information contained in this release, the matters discussed are forward-looking statements that involve risks and uncertainties. When used in this release, words such as “anticipates”, “believes”, “could”, “estimates”, “expects”, “may”, “plans”, “potential” and “intends” and similar expressions, as they relate to the Company or its management, identify forward-looking statements. Such forward-looking statements are based on the beliefs of the Company’s management, as well as assumptions made by and information currently available to the Company’s management. Among the factors that could cause actual results to differ materially are the following: the effect of business and economic conditions; the effect of the dramatic changes taking place in the healthcare environment; the impact of competitive procedures and products and their pricing; medical insurance reimbursement policies; unexpected manufacturing or supplier problems; unforeseen difficulties and delays in the conduct of clinical trials and other product development programs; the actions of regulatory authorities and third-party payers in the United States and overseas; uncertainties about the acceptance of a novel therapeutic modality by the medical community; continuation of the GEHC agreement; and the risk factors reported from time to time in the Company’s SEC reports. The Company undertakes no obligation to update forward-looking statements as a result of future events or developments.