InspireMD Reports Financial Results for

InspireMD Reports Financial Results for

the Second Quarter Ended June 30, 2014

BOSTON, MA - July 23, 2014 - InspireMD,

Inc. (NYSE MKT: NSPR) ("InspireMD" or the "Company"), a leader in embolic protection systems

("EPS"), today announced its financial and operating results for the second quarter, which ended June 30, 2014.

Recent Operating Highlights

"The financial performance for the quarter is within our

expectations, as sales activities for the MGuard Prime EPS were temporarily halted following our voluntary field action (VFA).

We successfully managed the VFA regulatory process in Europe and have now shifted our focus to ramping our commercial activities,"

said Alan Milinazzo, CEO of InspireMD. "This quarter also marked the successful completion of enrollment in the CARENET trial,

which we view as a significant milestone in our plans to develop the CGuard EPS for patients with carotid artery disease. Enrollment

had a 100% procedural success rate and we are looking forward to sharing the results of the trial at the TCT conference in September."

"Additionally, we are pleased to

welcome Dr. Jim Barry as our new Chief Operating Officer. We are now entering a critical phase in the development of our DES strategies

and Jim's expertise will be invaluable to us," Concluded Milinazzo.

Operational Overview

European regulatory approval for a new

manufacturing process improving stent retention and performance in the MGuard Prime EPS was granted following the Company's

VFA that was implemented on April 30, 2014. The Company is in the process of modifying and redeploying all the MGuard Prime EPS

stents that were returned by clinical and commercial sites. The Company expects sales of the MGuard Prime EPS to ramp over the

next several months. Due to the VFA, the Company did not fill any new customer sales orders during the past two months. The MGuard

Prime EPS is currently InspireMD's primary commercial product and, as a result, the Company recorded sales of $0.2 million

for the second quarter ended June 30, 2014.

The planned expansion of the Company's

international sales organization has been completed with the additional hiring of several direct salespeople in Tier 1 countries

in Europe and Latin America. The team currently includes 20 people positioned to advance sales of the Company's coronary

and carotid devices.

The Company successfully completed enrollment in the CARENET

(CARotid Embolic protection using microNET) study. CARENET is a multi-specialty trial

to evaluate the safety and efficacy of the CGuard EPS for use in carotid artery disease. The acute procedural performance of the

CGuard device was 100% successful for all of the 30 patients enrolled in the trial. Follow up will be done using traditional assessments

post procedure and at 30 days to include MACE (death, stroke, MI) and ipsilateral stroke. The Company is in the process of evaluating

the results and anticipates sharing these data in September at the upcoming TCT Conference in Washington DC.

The Company continues to conduct studies

to ascertain the safety and efficacy of combining its proprietary MicroNet technology with existing drug eluting stent technologies.

Pre-clinical tests are being done with several already CE Marked or FDA approved drug eluting coronary stents and the Company continues

to negotiate with manufacturers and evaluate opportunities in this space. InspireMD remains committed to this phase of the development

of the next generation embolic protection system.

Enrollment in the MASTER II trial remains temporarily suspended,

pending review by the FDA of the manufacturing improvements to the MGuard Prime EPS. However, the Company continues to move forward

with site activation and audit activities so that the Company will be able to accelerate enrollment once the study is resumed,

which is expected to be in the third or fourth quarter of 2014. The MASTER II trial will evaluate the safety and effectiveness

of the MGuard Prime EPS in patients suffering from ST Elevation Myocardial Infarction (STEMI). The results are also

intended to support the Company's Investigational Device Exemption (IDE) application with the U.S. Food and Drug Administration

(FDA) to market the MGuard Prime MicroNet covered coronary stent system in the U.S.

Quarter Ended June 30, 2014 Financial

On April 30, 2014 sales were temporarily

suspended due to the VFA. As such, revenue for the quarter ended June 30, 2014 was $0.2 million compared to $1.5 million during

the same period in 2013.

Gross profit (loss) for the quarter ended

June 30, 2014 totaled $(0.4) million, a decrease of 158.5% compared to $0.7 million for the same period in 2013. This decrease

in gross profit was attributable to the impact of the VFA which included a decrease in revenues as well as $0.4 million in expenses

related to the modification of the MGuard Prime EPS.

Total operating expenses for the quarter

ended June 30, 2014 were $6.8 million, an increase of 40.2% compared to $4.9 million for the same period in 2013. This increase

was primarily due to higher research and development expenses attributable to the MASTER II trial, the CARENET trial, efforts to

improve stent retention and expenditures in sales and marketing as the Company increased its efforts to support the new sales strategies

in key European and Latin American countries.

The loss from operations for the quarter

ended June 30, 2014 was $7.2 million, an increase of 71.6% compared to a loss of $4.2 million for the same period in 2013.

Financial expenses for the quarter ended

June 30, 2014 decreased 97.0% to $0.3 million from $10.8 million during the same period in 2013. The decrease in financial expenses

resulted primarily from $9.9 million of non-cash effects in the quarter ended June 30, 2013 related to the adjustment of the conversion

ratio of our convertible debentures prior to their retirement in April 2013. No such expense occurred during the same period in

The net loss for the quarter ended June

30, 2014 totaled $7.6 million, or $0.22 per basic and diluted share, compared to a net loss of $14.9 million, or $0.48 per basic

and diluted share, in the same period in 2013.

Non-GAAP net loss for the quarter ended

June 30, 2014 was $6.5 million, or $0.19 per basic and diluted share, an increase of 107.8%, compared to a non-GAAP net loss of

$3.1 million, or $0.10 per basic and diluted share, for the same period in 2013. The non-GAAP net loss for the quarter ended June

30, 2014 primarily excludes $1.1 million of share-based compensation. The non-GAAP net loss for quarter ended June 30, 2013 primarily

excludes $10.7 million in non-cash financial expenses and $1.1 million in share-based compensation expenses.

Six Months Ended June 30, 2014 Financial

Revenue for the six months ended June 30,

2014 decreased $1.3 million to $1.7 million compared to $3.0 million during the same period in 2013. The 2014 period included an

expected decline in sales volume associated with the temporary stoppage of sales activities for the MGuard Prime EPS following

Gross profit for the six months ended June

30, 2014 totaled $0.5 million, a decrease of 69.1% compared to $1.5 million for the same period in 2013. This decrease in gross

profit was attributable to a decrease in revenues as well as the impact of expenses related to the VFA.

Total operating expenses for the six months

ended June 30, 2014 were $13.2 million, an increase of 48.2% compared to $8.9 million for the same period in 2013. This was primarily

due to increased research and development expenses attributable to the MASTER II trial, the CARENET trial, efforts to improve stent

retention and expenditures in sales and marketing as the Company increased its efforts to support the new sales strategies in key

European and Latin American countries.

The loss from operations for the six months

ended June 30, 2014 was $12.8 million, an increase of 72.0% compared to a loss of $7.4 million for the same period in 2013.

Financial expenses for the six months ended

June 30, 2014, decreased 94.1% to $0.7 million from $12.4 million during the same period in 2013. The decrease in financial expenses

resulted primarily from $9.9 million of non-cash effects in the six months ended June 30, 2013 related to the adjustment of the

conversion ratio of our convertible debentures prior to their retirement in April 2013, as well as $1.5 million of non-cash expense

in the six months ended June 30, 2013 related to our issuance of common stock without new consideration to certain investors resulting

from anti-dilution rights. No such expense occurred during the six months ended June 30, 2014.

The net loss for the six months ended June

30, 2014 totaled $13.5 million, or $0.40 per basic and diluted share, compared to a net loss of $19.8 million, or $0.80 per basic

and diluted share, in the same period in 2013.

Non-GAAP net loss for the six months ended

June 30, 2014 was $11.4 million, or $0.34 per basic and diluted share, an increase of 118.0% compared to a non-GAAP net loss of

$5.2 million, or $0.21 per basic and diluted share, for the same period in 2013. The non-GAAP net loss for the six months ended

June 30, 2014 primarily excludes $2.1 million of share-based compensation. The non-GAAP net loss for the six months ended June

30, 2013 primarily excludes $12.2 million in non-cash financial expenses and $2.4 million in share-based compensation expenses.