Magna-Lab, Inc. Retains Covance to Perform Economic and Reimbursement Strategy Development; Goal of Engagement is to Gain Optimal Reimbursement.

Business Editors

SYOSSET, N.Y.--(BUSINESS WIRE)--March 7, 2001

Magna-Lab Inc. (OTCBB: MAGLA) announced today that it has retained Covance Health Economics and Outcomes Services, Inc. ("CHEOS"), a subsidiary of Covance, Inc., a leading contract research organization, to provide economic marketing and reimbursement strategy development for the Company's Cardiac View transesophegeal MRI (magnetic resonance imaging) probe. This strategy engagement is the next logical step in the implementation of Magna-Lab's business plan and follows the Company's submission to the U.S. Food and Drug Administration ("FDA") of a 510(k) Notification for clearance to market Cardiac View.

The CHEOS study will involve a comprehensive review of the issues involved in obtaining optimal reimbursement for MRI procedures utilizing the Cardiac View product. The study involves interviews of cardiology administrators and cardiologists, as well as extensive studies of the practices of private and third party payers and the Health Care Financing Administration (HCFA) in reimbursing MRI procedures and procedures to diagnose heart disease. Among the results of the study will be recommendations to the Company in gaining optimal reimbursement for procedures using Cardiac View. Additionally, the study will provide the Company with a plan and timeframe for pursuing unique codes, coverage and payment that recognize the unique value of Cardiac View in the treatment of heart disease.

Covance Health Economics and Outcomes Services, Inc. is a leading healthcare consulting firm specializing in reimbursement planning and development, and in implementing economic support strategies for the medical device and diagnostic industry, as well as for the pharmaceutical and biotechnology industries. Covance Health Economics and Outcomes Services, Inc. works with its senior contacts in the healthcare industry and public and private payer organizations to help companies strategically position their products for competitive advantage in an increasingly complex medical marketplace.

Cardiac View is a transesophogeal MRI receiver coil, which is encased in a probe, and placed, non-invasively, directly behind the heart in the esophagus of the patient via the throat or nasal passages. Cardiac View is designed to operate in conjunction with an MRI system to generate images of the gross arterial structure of the heart and to aid in the production of MRI images of the heart and coronary vessels.

Cardiac View does not currently have U.S. marketing clearance from the FDA.

John R. Geisel, Chief Executive Officer stated, "We expect that Cardiac View will be reimbursed in connection with normal MRI procedures. The Covance study will give us the guidance that will pinpoint the existing reimbursement codes and help lay the framework for developing unique reimbursement codes that reflect the value of Cardiac View both in diagnosis and in avoiding other costs."

Magna-Lab Inc. is the developer of products that are designed to help make MRI technology more effective for the detection and diagnosis of Coronary Artery Disease. The products are non-invasive or minimally invasive disposable medical devices intended to permit the imaging of the major vessels of the heart.

Certain statements in this press release constitute "forward-looking statements" within the meaning of the private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company, or industry results, to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following: delays in product proprietary rights; competition; material costs and availability; changes in business strategy or development plans; quality of management; availability, terms and deployment of capital; business abilities and judgment of personnel; availability of qualified personnel; changes in, or the failure to comply with, government regulations as well as other matters discussed in the Company's filings with the Securities and exchange Commission.