Wednesday May 2, 2001

COMPANY PRESS RELEASE

Transgenomic, Inc. Reports Record First Quarter Revenues

Quarterly Life Sciences Revenues Up 66 Percent From the Comparable 2000 Period

SAN JOSE, Calif. and OMAHA, Neb., May 2 /PRNewswire/ -- Transgenomic, Inc. (Nasdaq: TBIO) today announced financial results for the quarter ended March 31, 2001. Revenues for the first quarter of 2001 were $7.9 million, 66 percent greater than life sciences revenues for the first quarter of 2000. Revenue growth was fueled by increased demand from existing customers and new commercial/industrial entities. The net loss for the quarter was $1.1 million or $0.05 per share as compared to $2.8 million or $0.22 per share in 2000. Losses from life sciences operations have declined sequentially for each of the last four quarters.

Transgenomic's life sciences revenues of $7.9 million and $4.8 million in 2001 and 2000, respectively, were all from product sales. In addition to the 66 percent increase in revenues, gross margin increased by 79 percent to $4.3 million. Life sciences operating expenses for the quarter increased 33 percent to $6.3 million. The increase in operating expenses is the result of the continued expansion of sales and customer support staffs, the related distribution infrastructure, the investment in research and development and the additional costs associated with being a public company.

"Transgenomic's first quarter results are continued evidence of the validation of our technology as an essential tool for the genomics community," said Collin D'Silva, chief executive officer. "During the quarter, over 35 percent of the units sold specifically for variation detection applications went to existing customers. In addition, sales remain strong into commercial accounts. These results demonstrate our success with utilizing a our current platform to provide solutions for multiple applications." D'Silva added that among the customers for the quarter were several leading biotech and pharmaceutical entities.

In speaking of results from a sequential perspective, D'Silva commented that, "Our first quarter revenues increased over 11 percent from the fourth quarter. This marked the eighth consecutive quarter of life sciences revenue growth for the company. We are pleased to have achieved a number of key milestones, including the installation of the 500th WAVE® System, launching the new 2100 and 3500 WAVE platform models and introducing a number of new customer support programs. These accomplishments continue to position Transgenomic as a premier solution provider addressing fundamental problems encountered in life sciences research."

"In addition to our continued strong internal growth, we are entering into an exciting new growth opportunity through the previously announced acquisition of Annovis, Inc. Synergies between our companies provides us with another growth driver that should enhance our profitability in the near future and aid in our continuing push toward entering new markets by leveraging our global distribution infrastructure," said D'Silva.

The company's historical financial results, which are presented in the tables below, include results of non-life sciences products through March 31, 2000. The company sold the assets related to the non-life sciences products as of that date.

About Transgenomic

Transgenomic provides innovative research tools to the genomics segment of the life sciences industry. These tools enable researchers to discover and understand variation in the human genetic code, or genome, in order to accelerate and improve drug development and diagnostics. We believe our WAVE System will become a leading tool to analyze genetic mutations. The WAVE System allows researchers to analyze both known and unknown genetic mutations faster, with more accuracy and at a lower cost than other commercially available techniques.

As efforts to sequence and annotate the human genome near completion, understanding variations in the genetic sequence, or mutation analysis, is becoming the vital link to the development of new diagnostic and therapeutic products. By comparing genetic mutations in the genome to the occurrence of diseases or particular traits, correlation can be made between genes and specific diseases or traits. The WAVE System, unlike tools employing more conventional technologies, can detect these genetic mutations without previous knowledge of their existence or position. As a result, the WAVE System provides researchers a more accurate and efficient means of performing the experiments necessary to identify mutations and to correlate the relationships between mutations and diseases.

Forward-Looking Statement

This press release may contain forward-looking statements that reflect management's current views and estimates of future economic circumstances, industry conditions, company performance and financial results. Such statements are subject to certain factors, risks and uncertainties described from time to time in Transgenomic, Inc.'s reports to the Securities and Exchange Commission, the company's Annual Report on Form 10-K for fiscal year ended December 31, 2000. Any change in such factors, risks and uncertainties may cause the actual results, events and performance to differ materially from those referred to in such statements. Accordingly, the company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 with respect to all statements contained in this press release.