ANN ARBOR ? Aastrom Biosciences, following a familiar pattern among life sciences start ups, posted another big loss in the first fiscal quarter of its year ? some $2.65 million.

The good news is the loss is less than the same quarter a year ago, when the tissue damage repair company lost $2.8 million.

But total revenue for the quarter ended September 30, 2004, consisting of product sales and rentals in the EU and grants, fell to $187,000 from $300,000 for the same period in fiscal year 2004.

“Our increased financial resources place us in a better position to respond operationally to any positive results from our ongoing clinical programs,” said Alan M. Wright, Senior Vice President Administrative and Financial Operations and Chief Financial Officer of Aastrom.

Highlights for Aastrom this year include:

Continued accrual of patients in its current FDA multi-center bone

graft trial in the U.S., and expansion to additional institutions as

clinical sites.

Expansion of clinical studies in Spain for bone grafting repair of

severe non-union fractures; pending positive results, move toward

commercialization in the EU.

Completion of a recently initiated jaw bone reconstruction clinical

trial in the EU for sinus lift procedures for dental implants; pending

positive results, move toward commercialization in the EU.

Initiation of an German clinical study to evaluate the ability of TRCs

to regenerate vascular tissue in patients with diabetic limb ischemia.

Pursuit of applicable opportunities for grants, to further define

potential uses and applications for our proprietary technology and cell

products.