Bacterin Announces Second Quarter 2014 Results Second Quarter 2014 Revenues Increase Approximately 7.5% Over Second Quarter 2013 BELGRADE, MT -(BUSINESS WIRE)

Second Quarter 2014 Results

Second Quarter 2014 Revenues Increase

Approximately 7.5% Over Second Quarter 2013

MT-(BUSINESS WIRE)- August 12, 2014 - Bacterin

International Holdings, Inc. (NYSE MKT: BONE), a leader in the development of bone graft material and coatings for medical applications,

today reported financial results for the second quarter ended June 30, 2014. The Company reported quarterly revenues of approximately

$8.9 million, and a net loss for the quarter of approximately ($1.9) million, or ($0.35) per common share.

Second quarter 2014 revenue was approximately $8.9 million,

an increase of 7.5% compared to approximately $8.3 million for the same period during 2013. Sequentially, revenues were flat with

approximately $8.9 million in revenues also reported for the first quarter of 2014.

the second quarter, we continued restructuring our sales organization. Melanie Head joined us as Vice President of Sales on May

1, 2014, and Bob DiSilvio joined us as President on July 1, 2014. These new executives have taken steps to further enhance our

sales organization" says Bacterin CEO, Dan Goldberger. "I

am looking forward to continued revenue growth in the second half of the year as our new team takes hold."

Gross profit for the second quarter 2014 was $5.6 million or

63% of revenues, compared to $4.7 million or 57% of revenues for the second quarter 2013. The increase was the result of improved

processes between the two periods. Sequentially, gross profit increased slightly from $5.5 million in the first quarter to $5.6

million in the second quarter of 2014. Gross margin in those quarters increased from 62% to 63%, respectively.

Sales and Marketing Expenses

Second quarter 2014 sales and marketing expenses increased 4.8%

to $4.4 million, as compared to $4.2 million during the same period in 2013. For the quarter, sales and marketing as a percentage

of revenues decreased to 50%, compared to 51% in 2013, as a result of increased efficiency within the sales organization. On a

sequential basis, sales and marketing expense increased from $4.1 million in the first quarter to $4.4 million in the second quarter.

This increase is due to the hiring of a Vice President of Sales and restructuring of the sales team.

Goldberger continued, "Through the second quarter, we brought

exciting new leadership to our sales function. As new members are integrated into our field sales force, we expect revenue growth

to accelerate. Going forward, we expect to continue to add productive employees and distributors in order to drive profitable revenue

General and Administrative Expenses

Second quarter 2014 general and administrative expenses remained

relatively flat year over year at $2.1 million. Sequentially, general and administrative expenses decreased approximately 9% from

$2.3 million in the first quarter of 2014.

Research and Development Expenses

Company reported second quarter 2014 research and development expenses of approximately $322,000, an increase from $255,000 reported

in the first quarter of this year. Second quarter research and development expenses increased 89% from the same period in 2013

due to increased activity on the company's hMatrix product

family and investment in product line extensions to our catalogue of demineralized bone products.

Loss from Operations

The second quarter 2014 loss from operations was approximately

($1.3) million, a decrease of approximately 29% over second quarter 2013 operating losses of ($1.9) million.

Company defines earnings before interest, taxes, depreciation and amortization ("EBITDA")

as net income/loss from operations before depreciation, amortization and non-cash stock-based compensation. EBITDA for the second

quarter of 2014 was a loss of approximately ($770,000), a significant decrease over the second quarter of 2013 EBITDA loss of ($1.4)

million. On a sequential basis, this compares to a first quarter 2014 EBITDA loss of approximately ($715,000).

cash equivalents and net accounts receivable were $7.9 million as of June 30, 2014 compared to $10.3 million at March 31, 2014.

On August 6, 2014, the Company announced that it issued 1,143,000 shares of its common stock in a public offering at a price per

share of $5.70 as well as warrants to purchase 571,500 shares of its common stock at an exercise price of $7.12 per share. Gross

proceeds from the transaction were approximately $6.5 million. Net proceeds, after deducting investment banking fees and offering

expenses, were approximately $5.8 million and will be utilized to enhance the company's

sales force and increase inventory levels to support expected future growth.

July 28, 2014 the company completed a 1:10 reverse stock split, which reduced the number of Bacterin's outstanding common shares

from approximately 55 million to approximately 5.5 million after the reverse split. After the company's

public offering, total common shares outstanding were approximately 6.6 million.

Goldberger further commented, "We have recently taken a number

of steps to ensure the sustainability of our business. Now that we have removed some of these overhangs, we can focus on the operations

Conference Call Details

The Company will hold a conference call hosted by Dan Goldberger,

Chief Executive Officer, and John Gandolfo, Chief Financial Officer, to discuss financial results at 10:00 a.m. ET, on Wednesday,

August 13, 2014. Please refer to the information below for conference call dial-in information and webcast registration.

Please call the conference telephone number 5-10 minutes prior

to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference

call, please contact the Cockrell Group at 1-877-889-1972.

the live call, a replay will be available on the Company's website, www.bacterin.com, under "Investor

About the Presentation of EBITDA

EBITDA is not a financial measure calculated and presented in

accordance with U.S. generally accepted accounting principles (GAAP) and should not be considered as an alternative to net income,

operating income or any other financial measures so calculated and presented, nor as an alternative to cash flow from operating

activities as a measure of liquidity. The company defines EBITDA as net income/(loss) from operations before depreciation, amortization

and non-cash stock-based compensation. Other companies (including competitors) may define EBITDA differently. The company presents

EBITDA because management believes it to be an important supplemental measure of performance that is commonly used by securities

analysts, investors and other interested parties in the evaluation of companies in our industry. Management also uses this information

internally for forecasting and budgeting. It may not be indicative of the historical operating results of Bacterin nor is it intended

to be predictive of potential future results. Investors should not consider EBITDA in isolation or as a substitute for analysis

of the company's results as reported under GAAP.

International Holdings

International Holdings, Inc. (NYSE MKT: BONE) develops, manufactures

and markets biologics products to domestic and international markets. These products are used in a variety of applications including

enhancing fusion in spine surgery, relief of back pain, promotion of bone growth in foot and ankle surgery, promotion of cranial

healing following neurosurgery and subchondral repair in knee and other joint surgeries.

Medical Device division develops, employs, and licenses coatings for various medical device applications. For further information,

please visit www.bacterin.com.

Important Cautions Regarding Forward-looking Statements

news release contains certain disclosures that may be deemed forward-looking statements within the meaning of the Private Securities

Litigation Reform Act of 1995 that are subject to significant risks and uncertainties. Forward-looking statements include statements

that are predictive in nature, that depend upon or refer to future events or conditions, or that include words such as "continue,"

"efforts," "expects," "anticipates," "intends," "plans," "believes,"

"estimates," "projects," "forecasts," "strategy," "will," "goal," "target,"

"prospects," "potential," "optimistic," "confident," "likely," "probable"

or similar expressions or the negative thereof. Statements of historical fact also may be deemed to be forward-looking statements.

We caution that these statements by their nature involve risks and uncertainties, and actual results may differ materially depending

on a variety of important factors, including, among others: the Company's ability to meet its existing and anticipated contractual

obligations, including financial covenant and other obligations contained in the Company's

secured lending facility; the Company's ability to manage

cash flow and achieve profitability; the Company's ability

to remain listed on the NYSE MKT; the Company's ability to develop, market, sell and distribute desirable applications, products

and services and to protect its intellectual property; the ability of the Company's sales force to achieve expected results; the

ability of the Company's customers to pay and the timeliness of such payments; the Company's ability to obtain financing as and

when needed; changes in consumer demands and preferences; the Company's ability to attract and retain management and employees

with appropriate skills and expertise; the Company's ability

to successfully conclude government investigations; the impact of changes in market, legal and regulatory conditions and in the