Allergy Research Group, Inc. Releases Profitable 1st Quarter Financial Results.

Business Editors and Health/Medical Writers

HAYWARD, Calif.--(BW HealthWire)--May 22, 2001

First quarter of 2001 financial results for Allergy Research Group, Inc. (OTCBB:ALRG), were announced today by Dr. Stephen Levine, CEO. Despite an overall downturn in the economy, to which the nutritional marketplace has not been immune, ALRG continues to be profitable.

Fiscal Year Ended March 31, 2001

During the three months ended March 31, 2001, ALRG had net sales of $2,858,949, representing a decrease of $324,517 from net sales of $3,183,466 during the three months ended March 31, 2000, primarily attributable to a general downturn in sales in the industry and due to the financial difficulties of two of our customers who distribute product to health food stores.

Cost of sales decreased $265,309 or to $1,687,687 for the three months ended March 31, 2001, compared to $1,952,996 for the three months ended March 31, 2000. Gross profit margins increased approximately 2%, approximating 41% for 2001. Typically, ALRG anticipates gross margins to approximate 45 to 50%. During the three months ended March 31, 2001, the Company experienced net income of $177,774, as compared to $83,463 for the three months ended March 31, 2000. The increase is due to a reduction in selling and general and administrative expenses, including salaries and legal fees, from $1,021,912 in 2000 to $946,028 in 2001, a reduction of research and development expenses from $92,196 in 2000 to $45,680 in 2001, and due to the fact that the benefit for income taxes was not recorded in 2000 until the third quarter.

Additionally, since fiscal year end, ALRG has added four new products to its product line: Imm-Kine (a bacterial cell-wall immunostimulant used for immune depression), VascuStatin (an herbal supplement that inhibits new blood vessel growth), Lutein (a plant extract that supports eye health), and Glucosol (an herbal supplement which supports the regulation of blood sugar levels).

Complete copies of the financial statements, including notes to the financials, can be found on our website at www.nutricology.com.

About Allergy Research Group, Inc.

Allergy Research Group, Inc. is an innovative leader in nutraceutical research and product formulation. Since its inception in 1979, the company has been noted for quality, hypoallergenic nutritional supplements and supplies products to over 6,000 physicians and healthcare practitioners worldwide.

The information contained in this news release, other than historical information, consists of forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those described in such statements. Such statements regarding the timing of acquiring and developing new products, of bringing them on line and of deriving revenues and profits from them, as well as the effects of those revenues and profits on the company's margins and financial position, is uncertain because many of the factors affecting the timing of those items are beyond the company's control.