Acquisition Strengthens Company's Position With Large Clinical Reference
                                 Laboratories

    SANTA CLARA, Calif., July 6 /PRNewswire/ -- Applied Imaging Corp.
(Nasdaq: AICX), the leading supplier of automated genetic imaging systems for
the analysis of chromosomes in cancer and prenatal disorders, announced that
it has entered into an agreement to acquire the assets of the United States-
based genetic imaging business of Perceptive Scientific Instruments (PSI) from
International Remote Imaging Systems, usually referred to as IRIS
(Amex: IRI).  This agreement is subject to normal closing conditions.
    "This acquisition further strengthens our position in the genetic imaging
market and is a strategic milestone toward our goal of market consolidation,"
said Jack Goldstein, Ph.D., Chairman and CEO of Applied Imaging.  "PSI
provides us with a strong position among large clinical reference
laboratories, complementing our well-established strength in hospital and
research genetics laboratories.  We are pleased to add the PowerGene products
to our extensive product line and we look forward to integrating the PSI team
and the company's League City, Texas operations into our existing business,"
Goldstein continued.
    "Applied Imaging now offers genetics and cancer researchers and clinicians
the most extensive selection of brightfield and fluorescence microscopy
imaging systems for advanced chromosome and DNA probe analysis," added
Goldstein.
    Commenting on the transaction, John A. O'Malley, Ph.D., Chairman and CEO
of IRIS, said, "We feel that Applied Imaging is the best possible acquirer of
our genetic testing business, given their extensive customer support and
distribution network and their long-term commitment to this market.  Our
companies are working together closely to effect a smooth transition so that
customers will receive consistent support and continued access to PowerGene
products in the future."
    Applied Imaging Corp., based in Santa Clara, California, is the leading
supplier of automated imaging systems utilized in genetics and pathology
laboratories for the analysis of chromosomes in cancer and prenatal disorders.
The Company is expanding its efforts in scanning and imaging applications in
the cancer pathology field, as well as providing key reagents in this area.
Applied Imaging has installed over 1800 systems in 800 laboratories in more
than 35 countries.

    This press release contains forward-looking statements as defined in the
Private Securities Litigation Reform Act of 1995, regarding, among other
matters, the Company's future financial performance as well as its research
and development and product development efforts.  Forward-looking statements
address matters that are subject to a number of risks and uncertainties,
including the uncertainty of clinical studies and regulatory approvals.
Actual results could differ materially from those projected in the forward-
looking statement as a result of a number of factors including the failure of
the Company to successfully develop and commercialize its micrometastasis or
genetic instrument business, and other such factors as set forth in the
Company's form 10-K for the year ended December 31, 1999 as filed with the
Securities and Exchange Commission.

    For additional information on Applied Imaging via fax, please dial
1-800-PRO-INFO, 732-544-2850 outside of the U.S., code AICX.

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