Lucid says it has connected the first users to its proprietary VivaNet system, a telemedicine network designed to allow dermatologists and pathologists to share high-resolution images of suspicious skin lesions taken with the Company’s VivaScope confocal imagers. The first users were connected in the New York City area. The Company’s VivaScope cellular imaging technology, which comprises the VivaScope System, received FDA 510(k) regulatory clearance on September 17, 2008.

“Initiating our VivaNet server marks the final step in commercializing our VivaScope technology,” said Jay M. Eastman, CEO of Lucid. “Lucid now provides both the non-invasive, imagers that assist physicians in skin cancer detection and also an integrated and rapid collaboration solution for physicians so that they can form accurate clinical assessments regarding the condition of a patient’s skin lesions, potentially providing earlier detection of skin malignancies.”

VivaNet is an Internet-based medical information system that facilitates secure, HIPAA-compliant, collaboration between dermatologists and pathologists in near real-time, providing images that these physicians can interpret for detection of skin cancers at the earliest, most curable stages. The VivaNet system rapidly transfers VivaScope images from dermatologists to pathologists so that together they can form more accurate clinical judgments regarding potential skin cancers. VivaNet also facilitates rapid second opinions, as necessary.

Mr. Eastman continued, “With the VivaScope System, a patient with a suspicious skin lesion is imaged in a non-invasive procedure that lasts five to 10 minutes. Typically the pathologist’s interpretation will be available within an hour. Thus, the dermatologist can explain the pathologist’s interpretation face-to-face with the patient, and discuss options and next steps, as warranted. All this is accomplished with minimal change to the workflow in the dermatologist’s office, while keeping image interpretation with the pathologist, as is the case for today’s standard of care.”

VivaNet is now being connected between dermatology practices and pathology practices worldwide, with the first sites scheduled for operation in New York, Arizona, California and subsequently in Italy, Spain, France, and Australia. Commercial operation of VivaNet should begin in the second half of 2009.

VivaScopes are in routine clinical use at several of the world’s leading melanoma clinics and skin cancer centers. The use of Lucid’s VivaScope technology (i.e., reflective confocal microscopy) has been validated in numerous clinical applications by more than 150 case and clinical studies published in peer-reviewed scientific and medical journals. A comprehensive list of these publications can be found at the Company’s Web site www.lucid-tech.com.