FOR MORE INFORMATION: Company Contact: Jeffrey Potrzebowski Chief Financial Officer & Vice President of Finance Phone: 765.497.8409 jpotrzebowski@BASinc.com BASi Reports First Quarter Results

BASi Reports First Quarter

WEST LAFAYETTE, IN, February

16, 2016 -- Bioanalytical Systems, Inc. (NASDAQ:BASI) ("BASi" or the "Company") today announced

financial results for the first quarter of fiscal 2016, which resulted in non-compliance with the financial covenants in its credit

First Quarter Results

For the three months ended December

31, 2015, revenue was $4,895,000 a 16% decrease from $5,845,000 in the first quarter of fiscal 2015.

revenue for the first quarter of fiscal 2016 decreased 7.8% to $4,055,000 compared to $4,398,000 for the same period in fiscal

2015. Increased preclinical services revenue was more than offset by lower other laboratory services revenue, due to fewer bioequivalence

studies, and a decline in Bioanalytical revenue, due to fewer samples received and analyzed and

a mix favoring method development and validation projects in the first three months of fiscal 2016 versus the comparable period

Sales in our Products segment

decreased 41.9% in the first quarter of fiscal 2016 to $840,000 from $1,447,000 in the same period in fiscal 2015. The majority

of the decrease stems from lower sales of our Culex automated in-vivo sampling systems and our analytical

instruments over the same period in fiscal 2015.

Gross profit decreased

to $984,000, or 20.1% of revenue, in the first quarter of fiscal 2016, compared to $1,904,000, or 32.6% of revenue, during the

comparable fiscal 2015 period. The principal causes for the decrease was the decline in revenue, which led to lower absorption

of the fixed costs in our business, and a sales mix favoring method development and validation projects, which generate

lower revenue but involve more dedicated resources.

Operating expenses for

the first quarter of fiscal 2016 decreased 14.1% to $1,513,000 compared to $1,762,000 during the first quarter of fiscal 2015.

The principal reasons for the decrease were lower utilization of outsourced professional engineering services,

decreased commissions and building rental income of $159,000 which was deducted from general

and administrative expenses.

Operating loss for the first quarter of fiscal 2016

amounted to $529,000 compared to operating income of $142,000 for the first quarter of fiscal 2015, primarily due to lower revenue

partially offset by decreased operating expenses.

Net loss for the first quarter

of fiscal 2016 amounted to $506,000, or $0.06 per diluted share, compared to net income of $182,000, or $0.01 per diluted share

for the first quarter of fiscal 2015.

EBITDA was negative for the first

quarter of fiscal 2016, amounting to $171,000, compared to a positive EBITDA for the first quarter of fiscal 2015 of $505,000.

Cash Used in Operating Activities

Cash used in operating activities

was $348,000 for the first quarter of fiscal 2016 due in part to the operating loss in the quarter and slightly higher working

capital levels. The Company had $403,000 in cash and cash equivalents at December 31, 2015. During the first quarter,

proceeds from borrowings net of repayments, and cash on hand funded capital expenditures for plant, machinery and equipment of

approximately $166,000 and the operating loss in the quarter.

Debt Covenant Non-Compliance

On May 14, 2014, we entered into

a Credit Agreement ("Agreement") with Huntington Bank. The Agreement includes both a term loan and a revolving loan

and is secured by mortgages on our facilities in West Lafayette and Evansville, Indiana and liens on our personal property. As

of December 31, 2015, we were not in compliance with certain financial covenants of the Agreement. On February 10, 2016, Huntington

Bank advised us that the failure to meet these financial covenants constitutes an event of default under the Agreement and that

they have reserved all of their rights with respect thereto, but Huntington Bank has not exercised its available remedies to date.

These remedies include the ability to accelerate the outstanding debt under our term loan and revolving loan, to exercise their

security interest and collect on the underlying collateral, to refrain from making additional advances under the revolving loan

and to terminate our interest rate swap. Were Huntington Bank to accelerate the outstanding debt, we would have insufficient funds

to satisfy that obligation, and their exercise of alternative remedies could also have a material adverse effect on our operations

and financial condition. As a result, of these circumstances, we have classified the entire term loan payable to Huntington Bank

as a current liability of the Company on the accompanying balance sheet.

Management is in discussion with

Huntington Bank to secure a forbearance whereby Huntington Bank would agree for a limited time period to forbear from exercising

certain of their rights and remedies under the credit facility available to Huntington as a result of the non-compliance. A forbearance

agreement would provide management with additional time to engage in discussions with Huntington Bank and other parties regarding

restructuring or replacing our debt, including amounts outstanding under the revolving loan scheduled to mature in May 2016, and

to explore alternative liquidity solutions.

The Company is engaged in exploring

initiatives to address solutions to our credit issues, which includes the evaluation and pursuit of various sources of financing.

Management is also undergoing a detailed review of all current pricing strategies and market programs and has introduced new initiatives

designed to increase revenue. Lastly, management has been, and continues to be actively engaged in driving operating costs lower

by more effectively controlling operating costs and manpower costs.

aware of the shortfall in revenue for the current and prior quarters, we are continuing our strategy to reach out to

clients, former and new, and to provide the scientific connection needed to assist in drug development. Recently, we awarded

three BASi Raturn Swivel-Free Sampling Systems to researchers who will integrate in vivo optogenetics techniques to enable

the generation of a fully integrative response profile made possible only with the use of BASi equipment. We have new,

experienced business development representatives who are expanding our reach in the Boston and San Francisco markets. We have

designed new modularity into our BASi Culex workstations to allow for bench top, single station and four station options. We

have also launched targeted initiatives in four key areas: to increase our IND-enabling studies in nonhuman primates, to

partner with clinics for sample analysis and sample kit preparation, to offer bioequivalence study expertise to our generics

clients and to increase market awareness and adoption of the BASi Culex In-vivo Automated Blood Sampling

System and related consumables via equipment grants and loan program." said BASi President and Chief Executive Officer

Ms. Lemke concluded, "I

understand that shareholders and creditors alike want to see immediate progress. We at BASi are committed to delivering on our

growth initiatives. As we partner with our clients, we are confident we will succeed."

Earnings Conference Call

BASi has scheduled a conference

call at 11:00 a.m. Eastern Standard Time (EST) on February 16, 2016 to discuss the results. To participate in the call, dial 866-865-2633,

participant passcode 43800479. A simultaneous webcast of the conference call may be accessed online from the Investors tab at www.BASinc.com.

The webcast will be available for replay after 2:00 p.m. EST at this same internet address. For a telephone replay, dial 855-859-2056,

participant passcode 43800479 after 2:00 p.m. EST.

Non-GAAP to GAAP Reconciliation

This press release contains financial

measures that are not calculated in accordance with generally accepted accounting principles in the United States (GAAP). The non-GAAP

financial measures are EBITDA for the first quarters of fiscal 2016 and 2015. EBITDA refers to a financial performance measure

that excludes certain income statement line items, such as interest, taxes, depreciation, and amortization. EBITDA may also exclude

certain non-cash expenses, such as stock-based compensation and the income or expense from the change in the warrant liability.

The non-GAAP financial information

should be considered supplemental to, and not as a substitute for, or superior to, financial measures calculated in accordance

with GAAP. Management, however, believes that EBITDA, when used in conjunction with the results presented in accordance with GAAP,

may provide a more complete understanding of the Company's results and may facilitate a fuller analysis of the Company's results,

particularly in evaluating performance from one period to another.

Management has chosen to provide

this supplemental information to investors, analysts, and other interested parties to enable them to perform additional analyses

of results and to illustrate the results giving effect to the non-GAAP adjustments shown in the reconciliation. Management strongly

encourages investors to review the Company's consolidated financial statements and publicly filed reports in their entirety and

cautions investors that the non-GAAP measures used by the Company may differ from similar measures used by other companies, even

when similar terms are used to identify such measures.