D. Medical Announces Strategic Reorganization

D. Medical Industries Ltd.

announced today that it has initiated a strategic restructuring designed to focus its business on maximizing and realizing the value of the Company's novel technology and intellectual property by licensing and/or selling such technology (or part of it) to third parties. In parallel, the Company will continue to pursue new OEM and high volume sales opportunities. The restructuring, which is designed to significantly reduce the Company's ongoing operating expenses and is effective immediately, includes a contemplated staff reduction and a voluntary reduction in the compensation of, among others, the chairman of the board, the chief executive officer, chief financial officer and the chief operating officer. The Company estimates that its current actions will reduce its cash burn rate to approximately NIS 700-800 thousand per month. In connection with D. Medical's efforts to reduce its ongoing operating expenses, it is also contemplating a possible reduction in the size of its Board of Directors.