FOR MORE INFORMATION: Company Contact: Jill C Blumhoff Chief Financial Officer Phone: 765.497.8381 jblumhoff@BASinc.com BASi Reports Third Quarter Results

BASi Reports Third Quarter

WEST LAFAYETTE, IN, August

11, 2016 -- Bioanalytical Systems, Inc. (NASDAQ:BASI) ("BASi" or the "Company") today announced

financial results for the third quarter and first nine months of fiscal 2016.

Third Quarter Results

For the three months ended June

30, 2016, revenue was $5,053,000 a 17.8% decrease from $6,150,000 in the third quarter of fiscal 2015.

Service revenue for the third

quarter of fiscal 2016 decreased 24.6% to $3,773,000 compared to $5,001,000 for the same period in fiscal 2015. The company recognized

a one-time benefit to Preclinical services revenues from an early termination in the third quarter of fiscal 2015 which did not

repeat in fiscal 2016, resulting in a 17% revenue decline versus the same quarter prior year. Bioanalytical revenue decreased 35%,

due to fewer samples received and analyzed in the third quarter of fiscal 2016 versus the comparable period in fiscal 2015.

Sales in our Product segment

increased 11.4% in the third quarter of fiscal 2016 to $1,280,000 from $1,149,000 in the same period in fiscal 2015. The majority

of the increase stems from increased instrument sales from our BASi Culex automated in-vivo sampling line,

plus an increase in sales of our analytical instruments and consumables over the same period in fiscal 2015.

Gross profit decreased to $1,173,000,

or 23.2% of revenue, in the third quarter of fiscal 2016, compared to $2,490,000, or 40.5% of revenue, during the comparable fiscal

2015 period. The principal cause for the decrease was the decline in services revenue which led to lower absorption of the fixed

costs in our business.

Operating expenses for the third

quarter of fiscal 2016 increased to $1,538,000 compared to $956,000 during the third quarter of fiscal 2015. The principal reason

for the increase was a favorable $620,000 mediation settlement with one of the Company's former service providers, which

reduced expenses in the third quarter of fiscal 2015. This settlement was recorded under operating expenses in the condensed consolidated

statements of operations and comprehensive income (loss).

Net loss for the third quarter

of fiscal 2016 amounted to $433,000, or $0.05 per diluted share, compared to net income of $1,478,000, or $0.16 per diluted share,

for the third quarter of fiscal 2015.

Adjusted EBITDA was negative

$2,000 for the third quarter of fiscal 2016, compared to a positive Adjusted EBITDA of $1,892,000 for the third quarter of fiscal

First Nine Months Results

For the nine months ended June

30, 2016, revenue decreased 13.7% to $15,287,000 compared to $17,721,000 for the first nine months of fiscal 2015. The decline

was due to lower Bioanalytical and Other Laboratory service revenues and a decline in instrument sales. Gross profit decreased

to $3,473,000, or 22.7% of revenue, compared to $6,196,000, or 35.0% of revenue, for the same period of the prior fiscal year.

The decline was driven by a decrease in revenues which led to lower absorption of fixed costs.

Operating expenses for the nine

months ended June 30, 2016 increased 3.1% to $4,692,000 from $4,492,000 for the comparable fiscal 2015 period. The principal reason

for the increase was a $620,000 mediation settlement with one of the Company's former service providers, which reduced expenses

in the third quarter of fiscal 2015, partially offset by additional building rental income during the fiscal 2016 period, which

was deducted from expense.

Net loss amounted to $1,193,000,

or $0.15 per diluted share, for the first nine months of fiscal 2016. Net income amounted to $1,810,000, or $0.16 per diluted share,

for the first nine months of fiscal 2015.

Adjusted EBITDA was negative

$89,000 for the first nine months of fiscal 2016, compared to a positive Adjusted EBITDA of $2,841,000 for the first nine months

Sources and Uses of Cash

Cash provided by operating activities

was $270,000 for the first nine months of fiscal 2016, a decrease from $1,175,000 in the comparable fiscal 2015 period, due to

the operating loss in the first nine months of fiscal 2016 offset in part by slightly lower working capital levels. The Company

had $492,000 in cash and cash equivalents at June 30, 2016. During the first nine months of fiscal 2016, proceeds from borrowings

net of repayments, and cash on hand funded capital expenditures for plant, machinery and equipment of approximately $837,000.

Credit Arrangements Default

We are currently in default of our credit

arrangements with Huntington Bank. Huntington Bank has reserved its rights resulting from this default, but as of August 11, 2016,

has not exercised any of its remedies. The available remedies include, among others, the ability to accelerate and immediately

demand payment of the outstanding debt under our term loan and revolving loan, to exercise its security interest, to take possession

of or sell the underlying collateral, to refrain from making additional advances under the revolving loan, to increase interest

accruing on the debt, and to terminate our interest rate swap. Were Huntington Bank to demand payment of the outstanding debt (whether

at or prior to the scheduled maturity of the loans on September 30, 2016), we would currently have insufficient funds to satisfy

that obligation, and the bank's exercise of alternative remedies could also have a material adverse effect on our operations

and financial condition.

The Company is exploring initiatives

to address solutions to our credit issues, which include the evaluation and pursuit of various sources of financing including a

refinancing as well as a possible sale and leaseback of the building in West Lafayette, Indiana. Management is also undergoing

a detailed review of all current account management and pricing strategies and market programs and has introduced new initiatives

designed to increase revenue around focused strength areas. These key areas of expertise include increasing our IND-enabling studies

in nonhuman primates, partnering with clinics for sample analysis and sample kit preparation, offering bioequivalence study expertise

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

System and related consumables via equipment grants. We have seen growth in our quotes issued and quotes accepted in these areas

in the current fiscal year. Management has been, and continues to be actively engaged in more effectively controlling operating

costs in the short term, as they strive for long term stabilization and growth.

As of May 11, 2016, the remaining

unexercised Class A warrants from our 2011 public offering have expired. The liability was reduced to zero in our third fiscal

quarter of 2016. As a result, we do not expect any additional charges to the Condensed Consolidated Statements of Operations and

Comprehensive Income (Loss) following this quarter.

Chief Executive Officer Remarks

Jacqueline Lemke, BASi's

President and Chief Executive Officer stated, "Revenue in the third quarter was lower than we expected. The Bioanalytical

services business has declined recently and we are addressing this with an added focus on large molecule analysis capabilities.

We have seen an increased level of demand for large molecule compound studies and are committed to delivering quality large molecule

services with our current, skilled employee base and our recent additional investment in specialized equipment. Preclinical services

are performing to plan in line with an uptick in the market for these services. As we continue to see the increase in the preclinical

market, we are addressing the challenge to efficiently increase our capacity and capabilities to deliver more quality work to our

Ms. Lemke continued, "Product

revenues remained improved, as compared to the first quarter of fiscal 2016. Recently, we partnered with PalmSens BV to expand

our offerings of very precise quantitative and qualitative electrochemical instrumentation to enable BASi to continue to provide

cutting edge research and development tools to our clients conducting scientific research, In addition, we are offering the BASi

Embrace Automation grant program to expand the awareness of and adoption of the BASi Culex in-vivo automated

blood sampling system, introducing those using manual sampling techniques to the benefits of automation."

Ms. Lemke concluded, "BASi's

quality personnel and our ability to consistently deliver high quality innovative solutions with regulatory excellence to the drug

discovery market remains exemplary. Although experiencing a depressed revenue period, we are committed to delivering growth in

our targeted areas of expertise and to responding to changes in the market. In a field requiring a multi-year commitment to research

and development programs and partners, growth is a long term process. We will continue to reach out to current and prospective

clients to provide the scientific connection needed to assist in their drug development process. . With these efforts focused on

improving operations, we are also pursuing financing options such as alternate debt financing and/or a sale and leaseback of our

West Lafayette facility to resolve cash flow issues and strive for long term stabilization and growth."

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