ACLARA BioSciences and Cepheid Awarded $3.0 Million DARPA Grant.

Business Editors/Health and Medical Writers

MOUNTAIN VIEW, Calif.--(BW HealthWire)--May 31, 2000

ACLARA BioSciences, Inc. (Nasdaq:ACLA) of Mountain View, California, and Cepheid of Sunnyvale, California, announced today that they have been awarded a $3.0 million grant from the Defense Advanced Research Projects Agency (DARPA). The companies will co-develop an integrated microfluidic system designed to perform automated measurements to simultaneously detect biological agents or genetically engineered variants. The system will combine Cepheid's proprietary microfluidic-based sample preparation technology with ACLARA's novel assay chemistries and microfluidic processing technology. These technologies will be integrated to perform complete measurements on ACLARA's plastic LabCard chips.

Joseph M. Limber, president and CEO of ACLARA commented, "We are excited to be working with Cepheid and DARPA. This collaboration is another example of our strategy of forming partnerships to leverage the capabilities of ACLARA's microfluidics and assay chemistry technologies. In addition to the possible military applications of interest to DARPA, we believe that the core technologies developed in this project will have potential in multiple areas of life science research, such as gene expression analysis and high throughput drug screening."

Thomas Gutshall, chairman and CEO of Cepheid noted, "The unique combination of Cepheid's and ACLARA's technologies will open new avenues to integrate and accelerate a variety of diagnostic tests that are expected to address the emerging pharmacogenomics market."

ACLARA BioSciences is a leading developer of microfluidic lab-on-a-chip technology, with access to the wide range of technology and intellectual property required to broadly address the genomics and pharmaceutical drug screening markets. The company is developing advanced tools for drug discovery and genomics using its proprietary microfluidics array technology and assay chemistries. By performing integrated sample processing and analysis on plastic microfluidic array LabCard chips, these tools enable the rapid, parallel processing of large numbers of samples while requiring only minute volumes of expensive or rare reagents. ACLARA has existing collaborations with PE Biosystems, Packard Instruments, Johnson & Johnson, and Cellomics. More information on ACLARA BioSciences can be found at www.aclara.com.

Cepheid is applying proprietary microfluidic and microelectronic technologies to the development of fast, versatile, miniaturized systems that can perform all the steps required to analyze complex biological samples -- including sample preparation, amplification, and detection -- with a single platform. Cepheid is initially focused on the detection of DNA and RNA in samples such as blood, urine, swabs, cell cultures, food, and industrial water in such application areas as life science research, clinical diagnostics, industrial testing, and pharmacogenomics. More information on Cepheid can be found at www.cepheid.com.

Note: Except for the historical information contained herein, this news release contains forward-looking statements that involve risks and uncertainties. Actual results may differ materially from those discussed herein. In particular, our performance involves risks and uncertainty, including, but not limited to, the risks that our products may not achieve market acceptance; that the company may not successfully introduce new products; that results of strategic partnerships or establishment of new partnerships may not occur as anticipated; and that litigation with Caliper may not be resolved in the company's favor. These and other risks related to ACLARA are detailed in ACLARA's Prospectus filed with the SEC dated March 20, 2000.