1115143--3/20/2006--ACUSPHERE

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{stock, price, share}

{stock, price, operating}

{property, intellectual, protect}

{product, liability, claim}

{competitive, industry, competition}

{product, market, service}

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{cost, regulation, environmental}

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{personnel, key, retain}

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Risks Related to Our Company We have not generated any product revenue to date, have a history of operating losses and our capital resources are limited. We need to allocate significant amounts of our available capital resources to make payments on our outstanding indebtedness and equipment lease obligations, our patent transfer agreement with Schering Aktiengesellschaft and as dividends on our 6.5% convertible exchangeable preferred stock, which in turn could reduce our financial flexibility and ability to fund other activities. Failure to obtain regulatory approvals for our product candidates under development, in particular our lead product candidate AI-700, would have a material adverse effect on our business. We may need to enroll more patients in our AI-700 Phase 3 clinical trials, and any such additional enrollment would require additional expenditures, which may be material, and would likely result in a delay of our submitting an NDA with the FDA for AI-700. If we cannot raise additional capital on acceptable terms, we may be unable to complete planned clinical trials, obtain regulatory approvals or commercialize our product candidates. Our products, if approved, may fail to achieve market acceptance. Claims by other parties that we infringe or have misappropriated their proprietary technology may result in liability for damages, royalties, or other payments, or stop our development and commercialization efforts. If we are unable to protect our intellectual property rights, our competitors may develop and market products with similar features that may reduce demand for our products, and we may be prevented from establishing collaborative relationships on favorable terms. We may become involved in lawsuits and administrative proceedings to protect, defend or enforce our patents that would be expensive and time consuming. We have never manufactured any of our product candidates in commercial quantities, and if we fail to develop an effective manufacturing capability for our products, including our lead product candidate AI-700, we may be unable to commercialize these products. We may not be able to manufacture our products in commercial quantities, which would prevent us from marketing our products. We have removed our AI-700 manufacturing equipment from the facilities of our third party contract manufacturer and currently have no facility within which to manufacture AI-700 until the new commercial manufacturing facility is qualified or until other arrangements are made. If third-party manufacturers of our products fail to devote sufficient time and resources to our concerns, or if their performance is substandard, our clinical trials may be delayed and our costs may rise. Materials necessary to manufacture our products may not be available, which may delay our development and commercialization activities. We have no experience selling, marketing or distributing our products and no internal capability to do so. If we are unable to retain key personnel and hire additional qualified scientific, manufacturing, sales and marketing, and other personnel, we may not be able to successfully achieve our goals. We will establish collaborative relationships, and those relationships may expose us to a number of risks. Competition in the pharmaceutical industry is intense, and if we fail to compete effectively our financial results will suffer. We expect to develop international operations that will expose us to additional business risks. Risks Related to Our Industry Even if we obtain marketing approval, our products will be subject to ongoing regulatory review. Market acceptance of our products will be limited if users of our products are unable to obtain adequate reimbursement from third-party payors. We may be required to defend lawsuits or pay damages in connection with the alleged or actual harm caused by our products or product candidates. Rapid technological change could make our products obsolete. Our products involve the use of hazardous materials, and as a result we are exposed to potential liability claims and to costs associated with complying with laws regulating hazardous waste. Risks Related to Our Common Stock We expect that our stock price will fluctuate significantly. Our controlling equity holders may have conflicts of interests with us or you in the future. Our common stock is junior to our preferred stock with respect to the right to receive payments in the event of a dissolution, liquidation or winding up of Acusphere. We may be the subject of securities class action litigation due to future stock price volatility. Future sales of common stock by our existing stockholders may cause our stock price to fall. The terms of our outstanding shares of preferred stock may restrict our ability to raise additional capital or hamper or prevent an acquisition of us. Under some circumstances, the holders of our outstanding shares of preferred stock may be entitled to elect some of the directors of Acusphere. Provisions of Delaware law or our charter documents could delay or prevent an acquisition of us, even if the acquisition would be beneficial to our stockholders, and could make it more difficult for you to change management. We have never paid dividends on our common stock, and we do not anticipate paying any cash dividends on our common stock in the foreseeable future.

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1115143--3/20/2006--ACUSPHERE_INC