Applied Immune Sciences Reports Third Quarter Results.

SANTA CLARA, Calif.--(BUSINESS WIRE)--Nov. 14, 1995--Applied Immune Sciences, Inc. (AIS)(NASDAQ/NMS:AISX) today reported results for the third quarter of fiscal 1995, which ended Sept. 30, 1995.

The company reported revenues of $166,000 and a net loss of $6,568,000, or $0.49 per share, compared to $263,000 in revenues and a net loss of $6,369,000, or $0.55 per share, for the third quarter of the prior year.

For the nine months ended Sept. 30, 1995, the company reported revenues of $856,000 and a net loss of $21,179,000, or $1.63 per share, compared to $726,000 in revenues and a net loss of $23,338,000, or $2.03 per share, for the same period in 1994.

Operating expenses for the third quarter and for the nine months ended Sept. 30, 1995 were $7,386,000 and $23,750,000 respectively, and included charges of $10,000 for the third quarter and $1,077,000 for the nine-month period relating to the continuing cash-out of stock options pursuant to the 1993 Investment Agreement with Rhone-Poulenc Rorer ("RPR").

Operating expenses for the third quarter and for the nine months ended Sept. 30, 1994 were $6,905,000 and $24,997,000 respectively, and included charges of $254,000 for the third quarter and $4,395,000 for the nine-month period relating to the continued cash-out of stock options pursuant to the 1993 Investment Agreement with Rhone-Poulenc Rorer ("RPR"). Increases in fiscal 1995 third quarter and nine month operating expenses primarily related to investments in ongoing clinical research and development of AIS technologies for product commercialization.

On Oct. 18, 1995, the company and Rhone-Poulenc Rorer announced that they entered into a definitive agreement and plan of merger providing for the acquisition of the company by RPR at a price of $11.75 per share in cash, or approximately $84.4 million, for the approximately 7.2 million company shares not currently held by RPR. Under the terms of the agreement, RPR through a wholly owned subsidiary, made a cash tender offer for all of the company's outstanding common stock. The tender offer is scheduled to expire on Nov. 21, 1995.

Applied Immune Sciences develops, manufactures, and delivers innovative cell and gene therapy products designed to enhance and restore the immune system in immune-related conditions such as bone marrow transplantation and cancer, autoimmune and infectious diseases. AIS entered into a strategic alliance with Rhone-Poulenc Rorer in 1993 and is now affiliated with the newly formed division, RPR Gencell. Through RPR Gencell, AIS has access to a network of 14 commercial, academic, and other institutions in the biotechnology field. Products are now in human clinical trials worldwide for bone marrow transplantation and the treatment of AIDS and cancer. -0-

                    Applied Immune Sciences, Inc.
                 Condensed Statement of Operations
              (In thousands, except per share amounts)
                            (Unaudited)

                          Three Months Ended     Nine Months Ended
                        Sept. 30,   Sept. 30,  Sept. 30,   Sept. 30,
                            1995     1994        1995        1994

Product sales               $ 88     $ 98        $356        $383
Grant & research fees         78      165         500         343
  net revenues               166      263         856         726

Operating expenses:
Cost of product sales         42       49         193         191
Research & development     5,725    4,945      17,258      15,766
Selling, general &
 administration            1,609    1,657       5,222       4,645
Special charge - RPR
 transaction                  10      254       1,077       4,395
                         -------   ------     -------     -------
Total operating expenses:  7,386    6,905      23,750      24,997

Loss from operations      (7,220)  (6,642)    (22,894)    (24,271)
Net interest income          652      273       1,715         933
Net loss                 ($6,568) ($6,369)   ($21,179)   ($23,338)
Net loss per share        ($0.49)  ($0.55)     ($1.63)     ($2.03)
Shares used in calculation
 of net loss per share    13,491   11,481      12,957      11,479

                   Condensed Consolidated Balance Sheet
                           (In thousands)

                                  Sept. 30,      Dec. 31,
                                     1995          1994
                                  (Unaudited)
Assets
Current assets:
Cash, cash equivalents and
 short term investments            $38,139        $16,577
Inventories                          1,108          1,305
Other current assets                 2,399          1,295
   Total current assets             41,646         19,177
Property and equipment, net         14,918         15,701
Other assets                         1,296          1,311
                                   -------        -------
  Total assets                     $57,860        $36,189

Liabilities and stockholders' equity
Current liabilities:
Accounts payable and other
 accrued liabilities                $5,301         $3,708
Current portion of capital
 lease obligations                     344          1,024
Deferred revenue                     1,776          2,291
  Total current liabilities          7,421          7,023

Capital lease obligations, net
 of current portion                     --             94
Stockholders' equity:
Capital stock                      208,543        165,997
Accumulated deficit               (158,104)      (136,925)
  Total stockholders' equity        50,439         29,072
                                 ---------      ---------
  Total liabilities and
   stockholders' equity            $57,860        $36,189

CONTACT: Applied Immune Sciences, Inc., Santa Clara

Jackie Cossmon, 408/492-9200