An implantable drug-delivery device for repairing a severed peripheral nerve. The drug-delivery device includes a matrix formed of a biopolymer and an erythropoietin (EPO) entrapped in the matrix. After in vivo implantation of the drug-delivery device, the EPO elutes over a period of 1 day to 12 weeks. Also disclosed is a method for repairing a severed peripheral nerve using the implantable drug-delivery device.