PSIVIDA CORP. REPORTS RESULTS FOR THE THIRD QUARTER ENDED MARCH 31, 2012 WATERTOWN, MA

PSIVIDA CORP. REPORTS RESULTS FOR THE THIRD QUARTER

ENDED MARCH 31, 2012

WATERTOWN, MA May 9, 2012

pSivida Corp. (NASDAQ: PSDV, ASX: PVA), a leader in developing sustained release, drug delivery products for treatment of back-of-the-eye diseases, today announced financial results for its third quarter ended March 31, 2012.

At March 31, 2012, cash, cash equivalents and marketable securities totaled $16.5 million compared to $18.7 million at December 31, 2011.

The third quarter was an excellent quarter as ILUVIEN received a positive outcome from the Decentralized Procedure in the EU.

ILUVIEN was indicated for the treatment of vision impairment associated with chronic diabetic macular edema (DME) considered insufficiently responsive to available therapies. ILUVIEN has since received marketing authorization in the UK and Austria

for the treatment of chronic DME, the first two of seven expected marketing authorizations in the EU, said Dr. Paul Ashton, President and CEO. We look forward to ILUVIEN receiving the marketing authorizations in France, Germany,

Italy, Portugal and Spain.

The International Diabetes Federation estimates that approximately 22.1 million people in these 7

countries are currently living with diabetes, of whom approximately 3 million live in the UK and 750,000 in Austria. Alimera Sciences, our licensee of ILUVIEN, estimates that approximately 1.2 million people suffer from DME in the 7 EU

countries, with nearly 200,000 of those in the UK and more than 40,000 of those in Austria.

We are also pleased with the progress in

our pre-clinical programs and our technology evaluations, said Dr. Ashton. In February 2012, we signed a funded technology evaluation agreement with Neuron Systems, Inc. under which the companies will evaluate the use of

pSivida s technology as a delivery system for the treatment of dry age-related macular degeneration (Dry AMD), a serious retinal disease that affects millions of people worldwide. There currently is no approved treatment for Dry AMD.

In collaboration with Pfizer, we are also continuing to progress development of our bioerodible insert to treat glaucoma and ocular

hypertension, said Dr. Ashton. The Company s proposed product candidate is an injectable, bioerodible sustained release insert delivering latanoprost and is currently the subject of a dose-ranging study. The Company granted Pfizer an

exclusive option under various circumstances to license the development and commercialization worldwide of this insert for human ophthalmic disease other than uveitis.

We are continuing to pursue our independent development of an insert to treat uveitis affecting the posterior segment of the eye, Dr. Ashton continued. The Company s posterior

uveitis product candidate uses the same injectable micro insert as ILUVIEN for DME. The Alimera collaboration agreement allows the Company to reference the ILUVIEN for DME regulatory filings. In the United States, posterior uveitis has been

estimated to affect approximately 175,000 people and to be responsible for approximately 30,000 cases of blindness. An investigator-sponsored trial for the insert for posterior uveitis opened in September 2011.

Revenues for the third quarter were $538,000 compared to $360,000 a year earlier, primarily reflecting

recognition of deferred collaborative research and development revenues from the June 2011 amended and restated Pfizer agreement and increased Retisert royalty income. The Company reported a net loss of $2.7 million, or $0.13 per share, for

each of the third quarter periods ended March 31, 2012 and 2011.

Revenues for the nine months ended March 31, 2012 totaled $2.8

million compared to $1.3 million for the prior year period, primarily reflecting recognition of deferred collaborative research and development revenues from a terminated 2008 field-of-use license and from the restated Pfizer agreement. The current

year-to-date period included a $14.8 million impairment write-down of the Company s finite-lived intangible assets as a result of the November 2011 complete response letter issued by the FDA in response to Alimera s resubmitted new drug

application for ILUVIEN for DME and the resulting significant decrease in the Company s share price. The Company reported a net loss of $22.6 million, or $1.09 per share, for the nine months ended March 31, 2012 compared to a net loss of

$8.5 million, or $0.45 per share, for the same period of the prior year.

Today s Conference Call Reminder

pSivida Corp. will host a live webcast and conference call today, May 9, 2012, at 8:30 am ET. The conference call may be accessed by dialing

(866) 761-0749 from the U.S. and Canada, or (617) 614-2707 from international locations, passcode 59672747. The conference can also be accessed on the pSivida Corp. website at www.psivida.com. A replay of the call will be available

approximately two hours following the end of the call through May 16, 2012. The replay may be accessed by dialing (888) 286-8010 within the U.S. and Canada or (617) 801-6888 from international locations, passcode 71355857.

pSivida Corp., headquartered in Watertown, MA, develops tiny, sustained release, drug delivery products designed to deliver drugs at a controlled and

steady rate for months or years. pSivida is currently focused on treatment of chronic diseases of the back of the eye utilizing its core technology systems, Durasert and BioSilicon . ILUVIEN for the treatment of Diabetic Macular

Edema (DME), which is licensed to Alimera Sciences Inc., is pSivida s most advanced product candidate and received a positive outcome from the EU Decentralized Procedure in February 2012 with a determination that ILUVIEN is approvable for the

treatment of vision impairment associated with chronic DME considered insufficiently responsive to available therapies. An investigator-sponsored Investigational New Drug application is open for an injectable insert to treat posterior uveitis of the

same design as ILUVIEN for DME, and an investigator-sponsored trial is ongoing for an injectable, bioerodible insert to treat glaucoma and ocular hypertension. pSivida s two FDA-approved products, Retisert and Vitrasert , are implants

that provide long-term, sustained drug delivery to treat two other chronic diseases of the retina.

SAFE HARBOR STATEMENTS UNDER THE PRIVATE

SECURITIES LITIGATION REFORM ACT OF 1995: Various statements made in this release are forward-looking, and are inherently subject to risks, uncertainties and potentially inaccurate assumptions. All statements that address activities, events or

developments that we intend, expect or believe may occur in the future are forward-looking statements. The following are some of the factors that could cause actual results to differ materially from the anticipated results or other expectations

expressed, anticipated or implied in our forward-looking statements: Alimera s ability to obtain regulatory approval of and successfully commercialize (alone or with others) ILUVIEN for DME in the EU and delays in any such approval; actions

with respect to regulatory approval of ILUVIEN for DME in the U.S.; ability to obtain additional capital; ability to attain profitability; adverse side effects; exercise by Pfizer of the Latanoprost Product option; ability to complete clinical

trials and obtain regulatory approval of product candidates; further impairment of intangible assets; fluctuations in operating results; decline in royalty revenues; ability to find partners to develop and market products; termination of license

agreements; competition; market acceptance of products and product candidates; reduction in use of products as a result of future guidelines, recommendations or studies; ability to protect intellectual property and avoid infringement of others

intellectual property; retention of key personnel; product liability; consolidation in the pharmaceutical and biotechnology industries; compliance with environmental laws; manufacturing risks; risks and costs of international business operations;

credit and financial market conditions; legislative or regulatory changes; volatility of stock price; possible dilution; possible influence by Pfizer; ability to pay any registration penalties; absence of dividends; and other factors described in

our filings with the Securities and Exchange Commission. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. Our forward-looking statements speak only as of the dates on which they are

made. We do not undertake any obligation to publicly update or revise our forward-looking statements even if experience or future changes makes it clear that any projected results expressed or implied in such statements will not be realized.

PSIVIDA CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands except per share amounts)

PSIVIDA CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS