Cardiovascular Diagnostics Reports Third Quarter Results.

RALEIGH, N.C.--(BW HealthWire)--Oct. 27, 1998--Cardiovascular Diagnostics, Inc. (NASDAQ NM: CVDI) ("CVDI") today announced financial results for the three and nine months ended September 30, 1998. Highlights of the 1998 third quarter include:

-- The signing of a global distribution agreement with Bayer/Chiron

Diagnostics for certain CVDI diagnostic coagulation tests

-- The purchase by Chiron of $6 million of CVDI common stock at $10

per share

-- The initiation of field trials with the theranostic test

developed with Eli Lilly as an indicator for sepsis therapy

-- The initiation of field trials with the theranostic test

developed with Knoll AG ("Knoll") for use in stroke therapy

Revenues for the 1998 third quarter were $2,202,000, an increase of 31% over revenues of $1,677,000 for the third quarter of 1997. Revenues for the 1998 third quarter were positively impacted by the shipment of the remaining Thrombolytic Assessment System (TAS) analyzers to Knoll related to their $2.1 million order placed earlier in the year. The increased revenues, combined with a 14% decrease in operating expenses, led to an operating loss for the 1998 third quarter of $1,002,000, a 42% improvement from the operating loss in the third quarter of 1997. The net loss for the 1998 third quarter was $945,000, or a loss of $0.14 per basic share, compared with a net loss of $1,449,000, or a loss of $0.22 per basic share, for the 1997 third quarter.

Revenues for the nine months ended September 30, 1998 were $6,797,000, an increase of 19% compared with revenues of $5,720,000 for the same period last year. Year-to-date operating expenses decreased 10% to $4,944,000, compared with $5,486,000 for the same period last year. This resulted in an improved nine-month operating loss of $2,834,000, compared with the nine-month 1997 operating loss of $4,199,000. For the nine months ended September 30, 1998, CVDI reported a net loss of $2,469,000, or a loss of $0.36 per basic share, compared with a net loss of $2,874,000, or a loss of $0.43 per share, for the same period in 1997.

Commenting on the quarter, John Funkhouser, President and Chief Executive Officer, said, "We continue to make strong progress in the development of our theranostic tests and remain committed to forming additional collaborations with pharmaceutical companies. Also, we are planning to implement a strategy to attempt to diversify our scientific base through the formation of joint ventures and/or acquisitions of promising new technologies. We expect these new developments to expand on our current base of business and provide additional synergies throughout the organization."

An important highlight of the quarter was the August 28th signing of a global distribution agreement for certain CVDI diagnostic coagulation tests with Chiron Diagnostics ("Chiron"), which is in the process of being sold to the Bayer Group. This combination will make Bayer the world's No. 4 diagnostic company, offering further potential market opportunities for CVDI. Bayer is fully supportive of Chiron's partnership with CVDI, and Bayer's strength in the physician office and self-test markets could expand use of CVDI's products outside the hospital. As part of the August 28th agreement, Chiron purchased $6 million of CVDI common stock at $10 per share. CVDI's products are complementary to Chiron's blood gas technology, and each company believes the agreement will help to further expand their market share in point-of-care settings. Chiron will begin marketing CVDI's tests beginning in January 1999.

In addition to the Chiron announcement, CVDI continued to pursue its strategy of developing rapid diagnostic specialty tests for new therapeutics. The test currently being developed in conjunction with Eli Lilly will be used to evaluate the effect of a new therapeutic anticoagulant ("TA") that completed Phase II trials. The Phase II trials involved laboratory testing of samples collected from patients with or at risk of developing sepsis. The diagnostic test is now in clinical field trials at major centers in the United States and Canada and the data collected will be used to optimize and finalize the test format.

An additional test, the Low Range Fibrinogen ("LRF") test, is currently being developed with Knoll and will be used to monitor the fibrinogen levels of patients receiving Knoll's new drug Ancrod(R) for the treatment of ischemic stroke. This diagnostic recently entered field trials in Europe. This is the second test card CVDI has developed for use by Knoll to monitor its new highly potent drugs. The first diagnostic test, the Ecarin Clotting Time ("ECT") test, was developed to monitor the effect of Knoll's thrombin inhibitor PEG Hirudin. The ECT test completed all phases of development this year and the Company filed a 510(k) with the U.S. Food and Drug Administration. Knoll will be using these test cards and analyzers in their Phase III trials.

Commenting on these and other developments, Mr. Funkhouser said, "We are pleased these tests are proceeding into more advanced stages of development. Although more work must be done to commercialize these products, we are encouraged that our technology platform has shown flexibility during these development stages. Further, other drug targets have been identified and, in some cases, initial feasibility studies have been completed to evaluate the potential of developing theranostic tests. Some of these results have been presented to potential pharmaceutical partners in order to initiate collaboration discussions."

As CVDI makes further progress in establishing itself in the emerging field of theranostics, or the rapid near-patient testing in which the diagnostic results influence treatment decisions, CVDI has submitted for shareholder approval a proposal to change the Company's corporate name to PharmaNetics and its NASDAQ ticker symbol to PHAR. Shareholders are expected to vote on the proposed name change at a special meeting scheduled for December 2, 1998.

Cardiovascular Diagnostics, Inc. develops, manufactures and markets rapid turnaround diagnostics to assess blood clot formation and dissolution. The Company develops tests based on its proprietary, dry chemistry Thrombolytic Assessment System for its principal target market of powerful new drug compounds, some of which have narrow therapeutic ranges, as well as for monitoring routine anticoagulants. The Company's therapeutic diagnostics are used in the treatment of angina, myocardial infarction (heart attack), stroke, deep venous thrombosis, and pulmonary and arterial emboli.

This press release contains forward-looking statements regarding future events and the future performance of Cardiovascular Diagnostics that involve risks and uncertainties, such as risks related to market acceptance, clinical trials and dependence on third-party distributors and collaborative partners that could cause actual results to differ materially from those projected in the forward-looking statements. Information concerning these and other of the factors that could cause actual results to materially differ from those in the forward-looking statements is contained in the Company's SEC filings, including Form 10-K, Form 10-Q and Form 8-K reports. -0-

Cardiovascular Diagnostics Inc.
Selected Financial Summary

Consolidated Income (Loss) Statements

                        Three Months Ended        Nine Months Ended
                      Sept. 30,    Sept. 30,   Sept. 30,     Sept. 30,
                       1998          1997        1998          1997

Net Revenue         $2,201,908  $ 1,677,003  $ 6,797,440  $ 5,720,155
Cost of Goods Sold   1,539,655    1,483,662    4,688,078    4,433,757
Gross Profit           662,253      193,341    2,109,362    1,286,398

Operating Expenses   1,664,739    1,926,233    4,943,723    5,485,773

Operating Loss      (1,002,486)  (1,732,892)  (2,834,361)  (4,199,375)

Other Income            72,021      298,321      432,579    1,368,186

Net Loss Before
 Taxes                (930,465)  (1,434,571)  (2,401,782)  (2,831,189)

Provision for
 Income Taxes          (14,750)     (14,273)     (67,250)     (42,819)

Net Loss             ($945,215) ($1,448,844) ($2,469,032) ($2,874,008)

Basic and Diluted
 Loss Per Common
 Share                 ($ 0.14)     ($ 0.22)     ($ 0.36)     ($ 0.43)

Weighted Average
 Common Shares
 Outstanding         7,010,706    6,733,452    6,859,330    6,725,959

Consolidated Balance Sheets

                            September 30,   December 31,
                                1998            1997

Cash and investments         $ 9,071,378   $ 5,884,522
Other Current Assets           4,754,529     5,102,572
Total Assets                  20,296,208    17,684,503

Current Liabilities            1,536,331     2,140,620
Total Liabilities              3,393,413     4,491,795
Total Shareholders' Equity    16,902,795    13,192,708
Total Liabilities and
 Shareholders' Equity        $20,296,208   $17,684,503