SEAL was invented by Dr. Gary Gerard and colleagues in Transgenomic's Gaithersburg Laboratories, evolving from the Company's SURVEYOR Nuclease technology, which is highly sensitive for detecting genetic variations. By focusing analysis solely on regions of DNA variation, SEAL eliminates the sequencing of vast amounts of non-variant DNA, but is not limited to assessment of known common single nucleotide polymorphisms (SNPs). It thus bridges the current technology gap between haplotyping of known SNPs and deep high-throughput DNA sequencing.

Craig Tuttle, Chief Executive Officer and President of Transgenomic, commented, "This SBIR award by the NSF provides independent, peer-reviewed validation of the SEAL technology and its potential to meet unmet market needs. This supports our belief that SEAL will have a significant impact on whole genome analysis for pharmacogenomic studies in personalized medicine and bacterial drug resistance research."

About SEAL

SURVEYOR Endonuclease Adaptor-ligated Libraries (SEAL) is a cost-effective and high throughput enabling technology for whole genome analysis under development by Transgenomic. It identifies DNA variations between a reference genome and a test genome. Using a linker that attaches an identification tag of known sequence to the DNA ends processed by the SURVEYOR Nuclease, SEAL generates a library of genetic variations present within a DNA sample relative to a reference sample, allowing recognition of both the sequence of the variant nucleotide and the sequence context of the mutation. The library can be sequenced directly via standard or massively parallel systems, queried at any desired genetic locus by PCR amplification or archived for subsequent multi-query analysis.

About Transgenomic

Transgenomic is a global biotechnology company that provides unique products and services of automated high sensitivity genetic variation and mutation analysis. Their offerings include systems, products, discovery and laboratory testing services to the academic and medical research, clinical laboratory and pharmaceutical markets in the fields of Pharmacogenomics and personalized medicine. Specific offerings include WAVE(R) DHPLC Systems, related consumables and assay kits, Cytogenetics automated systems, and Transgenomic Pharmacogenomics and Reference Laboratory Services. Transgenomic Pharmacogenomics and Laboratory Services utilize their technology and expertise to provide a menu of mutation scanning tests for over 700 cancer-associated genes and more than 60 validated diagnostic tests to meet the needs of pharmaceutical and biotech companies, research and clinical laboratories, physicians and patients. For more information about the innovative systems, products and services offered by Transgenomic, please visit: http://www.transgenomic.com.

Transgenomic Cautionary Statements

Certain statements in this press release constitute "forward-looking statements" of Transgenomic within the meaning of the Private Securities Litigation Reform Act of 1995, which involve known and unknown risks, uncertainties and other factors that may cause our actual results to be materially different from any future results, performance or achievements expressed or implied by such statements. Forward-looking statements include, but are not limited to, those with respect to management's current views and estimates of future economic circumstances, industry conditions, company performance and financial results, including the ability of the Company to grow its involvement in the diagnostic products and services markets. The known risks, uncertainties and other factors affecting these forward-looking statements are described from time to time in Transgenomic's reports to the Securities and Exchange Commission. Any change in such factors, risks and uncertainties may cause the actual results, events and performance to differ materially from those referred to in such statements. Accordingly, the company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 with respect to all statements contained in this press release. All information in this press release is as of the date of the release and Transgenomic does not undertake any duty to update this information, including any forward-looking statements, unless required by law.

SOURCE Transgenomic

http://www.transgenomic.com

The presentation will be webcast live and can be accessed through the provided link:

http://www.wsw.com/webcast/rrshq14/tbio.ob/

About Transgenomic

Transgenomic (OTC-Bulletin Board: TBIO.OB) is a global biotechnology company specializing in high sensitivity genetic variation and mutation analysis. The Company provides products and services in the fields of pharmacogenomics and pharmacogenetics.

Product offerings include the WAVE(R) DHPLC Systems and associated consumables specifically designed for use in genetic variation detection and single- and double-strand DNA/RNA analysis and purification. With broad applicability to genetic research, over 1600 systems have been shipped to customers in more than 30 countries. The SURVEYOR(R) Mutation Detection Kits and SURVEYOR Check-It Kit provide reagents and protocols for the detection of mutations in DNA. In addition, HANABI automated chromosome harvesting systems improve laboratory productivity with consistent quality compared to manual methods.

Service offerings include the Transgenomic Clinical Reference Laboratory, which provides reference laboratory services specializing in molecular diagnostics including Mitochondrial Disorders, Oncology and Hematology, Molecular Pathology and Inherited Diseases. Transgenomic Genomic Research Services is a CRO for pharmacogenomic, translational research and clinical trials. For more information about the innovative systems, products and services offered by Transgenomic, please visit: http://www.transgenomic.com.

Transgenomic Cautionary Statements

Certain statements in this press release constitute "forward-looking statements" of Transgenomic within the meaning of the Private Securities Litigation Reform Act of 1995, which involve known and unknown risks, uncertainties and other factors that may cause our actual results to be materially different from any future results, performance or achievements expressed or implied by such statements. Forward-looking statements include, but are not limited to, those with respect to management's current views and estimates of future economic circumstances, industry conditions, company performance and financial results, including the ability of the Company to grow its involvement in the diagnostic products and services markets. The known risks, uncertainties and other factors affecting these forward-looking statements are described from time to time in Transgenomic's reports to the Securities and Exchange Commission. Any change in such factors, risks and uncertainties may cause the actual results, events and performance to differ materially from those referred to in such statements. Accordingly, the company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 with respect to all statements contained in this press release. All information in this press release is as of the date of the release and Transgenomic does not undertake any duty to update this information, including any forward-looking statements, unless required by law.

SOURCE Transgenomic

http://www.transgenomic.com

Net sales from continuing operations were $5.4 million during the third quarter of 2008, compared to $5.2 million during the comparable period of 2007. Gross profit from continuing operations was $2.9 million or 54 percent during the third quarter of 2008 compared to $2.7 million or 51 percent during the comparable period of 2007. Operating expenses from continuing operations were $3.4 million during the third quarter of 2008 compared to $4.1 million during the same period of 2007. The increase in gross profits and decrease in operating expenses reflect the Company's efforts to control costs while leveraging stable revenues from the instrument and consumables business to continue growing and expanding the Molecular Clinical Reference Laboratory and Pharmacogenomics Services Laboratory businesses.

The Company reported a net loss of $499,000 or $0.01 per share for the third quarter of 2008 as compared to a net loss of $1.3 million or $0.03 per share for the third quarter of 2007.

Cash and cash equivalents totaled $4.8 million at September 30, 2008.

Nine Months Ended September 30, 2008

The Company reported a net loss of $276,000 or $0.01 per share for the nine months ended September 30, 2008, compared to a net loss of $2.3 million or $0.05 per share during the comparable period of 2007. Net losses in 2008 resulted from continuing operations. The 2007 net loss was comprised of a loss from continuing operations of $2.4 million or $0.05 per share and income from discontinued operations of $66,000 or $0.00 per share.

Net sales from continuing operations were $17.9 million for the nine months ended September 30, 2008, compared to $16.7 million during the comparable period of 2007. The increase in net sales was attributable to revenue growth and expanding services from its laboratory businesses.

Gross profit from continuing operations was $10.3 million or 58 percent for the nine months ended September 30, 2008, compared to $8.8 million or 53 percent in 2007. Operating expenses from continuing operations were $10.7 million for the nine months ended September 30, 2008, compared to $12.3 million during the comparable period of 2007. Operating expenses for the nine months ended September 30, 2008 included $1.3 million of restructuring charges.

The company used cash flows from operations of $472,000 for the nine months ended September 30, 2008, compared to cash flows used in operations of $2.7 million during the same period in 2007. The increase in gross profit, decrease in operating expenses and lower cash flow use reflect the new management team's focus on conservative spending and revenue growth.

Comment and Outlook

Craig Tuttle, President and Chief Executive Officer of Transgenomic, commented, "We are pleased to announce 7% revenue growth year-to-date, driven by the strength of our expanding Laboratory Services businesses. We reported a net loss in the third quarter of 2008 after two consecutive quarters of profitability. Historically our third quarter has been slower for our instrument and service businesses due to summer laboratory closures in Europe and heavy vacation schedules in the U.S. We remain confident in our financial performance, which reflects our efforts to conserve cash while building our Laboratory Services businesses and maintaining our instrument revenues. We expect to continue expanding services offered within our laboratories as we evaluate in-licensing, collaboration and acquisition opportunities that have the potential to create additional value and accelerate growth."

Earnings Call

Company management will discuss third quarter 2008 financial results via teleconference on Wednesday, October 29th, at 5:00 p.m. Eastern Time. To access the call via telephone, dial 800-862-9098 or 785-424-1051. The Company will also host a live broadcast of the call over the Internet. To listen to the webcast, investors should log on to the Company's Investor Relations web page at http://www.transgenomic.com/events.asp?id=6 and follow the instructions provided. An archived recording of the conference call will be available and can be accessed via the web using the same link listed above for 14 days after the call. Investors can also listen to a replay via telephone until 11:59 p.m. Eastern Time on Wednesday, November 12, 2008. Simply dial 888-566-0849 or 402-220-0428 from any telephone.

About Transgenomic

Transgenomic is a global biotechnology company that provides unique products and services for automated high sensitivity genetic variation and mutation analysis. Their offerings include systems, products, discovery and laboratory testing services to the academic and medical research, clinical laboratory and pharmaceutical markets in the fields of pharmacogenomics and personalized medicine. Specific offerings include WAVE(R) DHPLC Systems, related consumables and assay kits, cytogenetics automated systems, Transgenomic Molecular Clinical Reference Laboratory and Pharmacogenomics Research Services. Transgenomic's two laboratory services divisions utilize these technologies and expertise to provide a menu of mutation scanning tests for over 700 cancer-associated genes and more than 60 validated diagnostic tests to meet the needs of pharmaceutical and biotech companies, research and clinical laboratories, physicians and patients. For more information about the innovative systems, products and services offered by Transgenomic, please visit: http://www.transgenomic.com.

Transgenomic Cautionary Statements

Certain statements in this press release constitute "forward-looking statements" of Transgenomic within the meaning of the Private Securities Litigation Reform Act of 1995, which involve known and unknown risks, uncertainties and other factors that may cause our actual results to be materially different from any future results, performance or achievements expressed or implied by such statements. Forward-looking statements include, but are not limited to, those with respect to management's current views and estimates of future economic circumstances, industry conditions, company performance and financial results, including the ability of the Company to grow its involvement in the diagnostic products and services markets. The known risks, uncertainties and other factors affecting these forward-looking statements are described from time to time in Transgenomic's reports to the Securities and Exchange Commission. Any change in such factors, risks and uncertainties may cause the actual results, events and performance to differ materially from those referred to in such statements. Accordingly, the company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 with respect to all statements contained in this press release. All information in this press release is as of the date of the release and Transgenomic does not undertake any duty to update this information, including any forward-looking statements, unless required by law.

                              Transgenomic, Inc.
                          Summary Financial Results
          Unaudited Condensed Consolidated Statements of Operations
                 (Dollars in thousands except per share data)

                            Three Months Ended         Nine Months Ended
                                September 30,             September 30,
                             2008         2007         2008         2007

    NET SALES               $5,367       $5,151      $17,869      $16,645
    COST OF GOODS SOLD       2,448        2,500        7,570        7,872
      Gross profit           2,919        2,651       10,299        8,773
    OPERATING EXPENSES:
      Selling, general
       and administrative    2,757        2,672        8,824        8,719
      Research and
       development             684          720        1,816        2,270
      Restructuring costs        -          681            8        1,305
                             3,441        4,073       10,648       12,294
    LOSS FROM OPERATIONS      (522)      (1,422)        (349)      (3,521)
    OTHER INCOME (EXPENSE):
      Interest income           22           75           80          215
      Other, net                14            4           13            8
      Gain on sale of investment -            -            -          938
                                36           79           93        1,161
    LOSS BEFORE INCOME TAXES  (486)      (1,343)        (256)      (2,360)
    INCOME TAX EXPENSE          13            6           20           25
    LOSS FROM CONTINUING
     OPERATIONS               (499)      (1,349)        (276)      (2,385)
    INCOME FROM DISCONTINUED
     OPERATIONS, NET OF TAX      -            -            -           66
    NET LOSS                 $(499)     $(1,349)       $(276)     $(2,319)

    BASIC AND DILUTED
     LOSS PER SHARE:
      From continuing
       operations           $(0.01)      $(0.03)      $(0.01)      $(0.05)
      From discontinued
       operations                -         0.00            -         0.00
                            $(0.01)      $(0.03)      $(0.01)      $(0.05)

    BASIC AND DILUTED
     WEIGHTED AVERAGE
     SHARES OUTSTANDING 49,189,672   49,189,672   49,189,672   49,189,672



                              Transgenomic, Inc.
                          Summary Financial Results
          Unaudited Condensed Consolidated Statements of Cash Flows
                            (Dollars in thousands)

                                                        Nine Months Ended
                                                          September 30,
                                                       2008           2007

    NET CASH FLOWS USED IN OPERATING ACTIVITIES         (472)        (2,652)

    NET CASH FLOWS PROVIDED BY (USED IN)
     INVESTING ACTIVITIES                               (254)         3,279

    EFFECT OF FOREIGN CURRENCY EXCHANGE RATE
     CHANGES ON CASH                                    (210)            48

    NET CHANGE IN CASH AND CASH EQUIVALENTS             (936)           675

    CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD   5,723          5,868

    CASH AND CASH EQUIVALENTS AT END OF PERIOD        $4,787         $6,543



                              Transgenomic, Inc.
                          Summary Financial Results
                    Condensed Consolidated Balance Sheets
                            (Dollars in thousands)

                                                  (Unaudited)
                                                  September 30,   December 31,
                                                       2008           2007
                           ASSETS
    CURRENT ASSETS:
      Cash and cash equivalents                       $4,787         $5,723
      Accounts receivable (net of allowances
       for bad debts of $501 and $703, respectively)   4,944          5,095
      Inventories                                      4,921          4,586
      Prepaid expenses and other current assets          727            759
        Total current assets                          15,379         16,163
    PROPERTY AND EQUIPMENT, NET                        1,276          1,579
    OTHER ASSETS:
      Goodwill                                           638            638
      Other assets, net                                  657            710
                                                     $17,950        $19,090
          LIABILITIES AND STOCKHOLDERS' EQUITY
    CURRENT LIABILITIES:
      Accounts payable                                  $816         $1,245
      Other accrued expenses                           2,526          3,152
      Accrued compensation                               752            450
        Total current liabilities                      4,094          4,847
    OTHER LONG TERM LIABILITIES                          141            141
        Total liabilities                              4,235          4,988
    STOCKHOLDERS' EQUITY                              13,715         14,102
                                                     $17,950        $19,090

SOURCE Transgenomic, Inc.

http://www.transgenomic.com

About Hythiam(R)

Hythiam, Inc. provides through its Catasys(TM) offering, behavioral health management services to health plans, employers and unions through a network of licensed and company managed healthcare providers. Catasys offers integrated substance dependence solutions built around the patented PROMETA(R) Treatment Program for alcoholism and stimulant dependence. The PROMETA Treatment Program, which integrates behavioral, nutritional, and medical components, is also available on a private-pay basis through licensed treatment providers and company managed treatment centers. Hythiam also researches, develops, licenses and commercializes innovative and proprietary physiological, nutritional, and behavioral treatment programs. Hythiam does not practice medicine or manufacture, distribute, or sell any medications and has no relationship with any manufacturers or distributors of medications used in the PROMETA Treatment Program. For further information, please visit www.hythiam.com.

Forward-Looking Statements

Except for statements of historical fact, the matters discussed in this press release are forward looking and made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect numerous assumptions and involve a variety of risks and uncertainties, many of which are beyond the company's control that may cause actual results to differ materially from stated expectations. These risk factors include, among others, limited operating history and lack of statistically significant formal research studies, the risk that treatment protocols might not be effective, difficulty in developing, exploiting and protecting proprietary technologies, intense competition and substantial regulation in the healthcare industry; and additional risks factors as discussed in the reports filed by the company with the Securities and Exchange Commission, which are available on its website at http://www.sec.gov.

SOURCE: Hythiam, Inc.

Investor Relations: 
Hythiam, Inc. 
Hasmik Bulujian, 310-444-4333 
hbulujian@hythiam.com 
or 
Media Relations: 
Dan Klores Communications 
Tim Sullivan, 212-981-5234 
tim_sullivan@dkcnews.com