For Immediate Release |
Salix Ventures Announces Investment in Habit Holdings, Inc.

ANDOVER, MA (October 27, 2006) -- Salix Ventures announced today its investment in Habit Holdings, Inc., based in Boston, MA. Habit is one of the countryís largest providers of outpatient treatment services to individuals addicted to opiate-based drugs such as heroin. The Companyís treatment model incorporates intensive counseling, rigorous testing and pharmacological intervention - principally methadone maintenance.

Salix Ventures, NewSpring Capital and Three Arch Partners provided the necessary equity to fund the purchase of Habitís assets, while TD Banknorth, N.A. provided debt financing through a senior secured term loan to help fund the buyout. Concurrent with this financing, Larry Davies joined Habit as Chief Executive Officer. Mr. Davies has over 20 years of health care services experience including 7 years as President and CEO of Apogee, Inc., an outpatient behavioral health provider that went public in 1994; 5 years as Division Vice-President of NovaCare, an NYSE rehabilitation services provider; 2 years as Director of Corporate Development at NovaCare; and 4 years as Director of Mergers and Acquisitions for Foster Medical, a NASDAQ home health concern. As a result of this investment, Mark Donovan of Salix Ventures will join Habit's Board of Directors.

According to Mr. Donovan, "Substance abuse and its related addictions continue to be a severe and growing problem in this country. Although already too substantial, the associated societal costs - economical, physical and emotional - that addiction brings with it, are dramatically mitigated with the efforts put forth by companies such as Habit. We are very excited and pleased to be part of a company providing critical services to such a needy and underserved market and are further excited to be working with such an outstanding and experienced CEO in Mr. Davies."

About Salix Ventures

Salix Ventures manages two venture capital partnerships with approximately $180 million in capital commitments from limited partners. Salix invests primarily in early-stage healthcare services and healthcare information technology companies. With offices in Andover, Nashville and San Francisco, Salix Ventures assists companies across the country through all stages of development.

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