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COVANCE REPORTS $0.11/SHARE FOR 4Q 2000
Revenue Growth and Improved Clinical Development and Biomanufacturing Results Drive Higher Fourth Quarter Earnings

Princeton, N.J., January 30, 2001 — Covance Inc. (NYSE: CVD) today reported earnings for its fourth quarter ended December 31, 2000 of $0.11/diluted share. For the full year 2000, the Company reported earnings of $0.40/diluted share, excluding net special charges and including a non-operating adjustment.

Commenting on the Company's financial results, Chris Kuebler, Covance Chairman and CEO said, "We are encouraged by our improved financial performance in the fourth quarter. In addition to revenue growth in the quarter, our clinical and biomanufacturing units delivered modest operating income after experiencing losses through the third quarter of 2000. In the first half of 2001, we anticipate significantly reducing our debt as we apply approximately $110 million in net proceeds from the pending sale of our packaging business and additional proceeds from the planned divestiture of our biomanufacturing business. Based on these developments and very early indicators of increasing clinical development activities among pharmaceutical companies, we are cautiously optimistic about our prospects for improved financial performance in 2001."

4Q and FY 2000 Financial Results (excluding net special charges and including a non-operating adjustment)

Net revenues for the fourth quarter of 2000 increased 13.2% to $231.4 million, compared to $204.4 million in the prior year and $214.9 million in the third quarter of 2000. Full year net revenues increased 4.7% to $868.1 million compared to $829.0 million for 1999. Excluding the impact of foreign exchange rate changes, fourth quarter and full year 2000 revenues increased 17.9% and 7.9% respectively.

Operating income for the fourth quarter of 2000 was $17.1 million resulting in an operating margin of 7.4% compared to $24.1 million or 11.8% operating margin for the same period in 1999 and $7.9 million or 3.7% operating margin for the third quarter of 2000. Full year operating income was $57.1 million, resulting in an operating margin of 6.6% compared to $99.6 million or 12.0% for 1999.

Net income for the fourth quarter of 2000 was $6.4 million or $0.11/diluted share compared to $12.8 million or $0.22/diluted share for the fourth quarter of 1999. Full year net income was $22.9 million or $0.40/diluted share compared to $53.6 million or $0.91/diluted share for the same period in 1999.

Segment Results
Early Development Segment

($ in millions)	4Q'00	4Q'99	Change	YTD'00	YTD'99	Change
Revenues	$72.4	$70.5	2.8%	$287.2	$273.3	5.1%
Costs/Expenses	64.4	59.0	9.2%	249.1	230.5	8.1%
OM%	11.0%	16.3%		13.3%	15.7%

The Company's Early Development segment includes preclinical and Phase I clinical trial services. Excluding the impact of foreign exchange rate changes, Early Development revenues grew 7.3% in the fourth quarter of 2000 and 7.9% for the full year. Growth in toxicology revenues for the quarter and full year were partially offset by continued softness in other service areas such as metabolism and immunochemistry. Toxicology revenues account for more than half of all Early Development segment revenues.

Operating margins for the fourth quarter and full year 2000 were lower than the prior year, reflecting softer revenues in certain service areas, increased payroll costs and investment spending for bioanalytical services and internet-enabled data management systems. Covance's new bioanalytical service offering, BIOLINK™, was launched in October 2000 and is expected to become break-even by the end of 2001.

Late-Stage Development Segment

($ in millions)	4Q'00	4Q'99	Change	YTD'00	YTD'99	Change
Revenues	$159.0	$133.9	18.7%	$580.9	$555.7	4.5%
Costs/Expenses	149.8	121.3	23.5%	561.8	498.9	12.6%
OM%	5.7%	9.4%		3.3%	10.2%

The Late-Stage Development segment includes clinical development, clinical support services, biomanufacturing, and commercialization services. Excluding the impact of foreign exchange rate changes, revenues for the fourth quarter of 2000 grew 23.4% and 7.9% year to date over the prior year. Revenues for the fourth quarter of 2000 grew 10.7 % sequentially. Revenue growth in the fourth quarter of 2000 over the third quarter and the prior year was primarily attributable to biomanufacturing, packaging, and central laboratory services. Full year 2000 revenues grew modestly compared to the prior year primarily due to the impact of significantly lower clinical development revenues.

Operating margin of 5.7% for the fourth quarter showed significant sequential improvement over the third quarter loss of (0.8)% primarily due to improved results in biomanufacturing and clinical development services, which delivered modest operating income in the fourth quarter, and stronger packaging margins. Operating margins for the fourth quarter and full year 2000 declined over the prior year due to losses in clinical development and biomanufacturing services in the first nine months of the year, increased payroll costs and investment spending for Nexigent. The mix of lower-margin studies and cancellations in central laboratory services also impacted operating margins for the fourth quarter and full year 2000.

Additional Information

On December 26, 2000, Covance announced that it had entered into an agreement to sell its packaging business to Fisher Scientific for $137.5 million. The transaction has received clearance to proceed from the Federal Trade Commission and is expected to close shortly. Covance will use the expected net proceeds of approximately $110 million to pay down debt, which will reduce interest expense.

The Company anticipates earnings for the first quarter of 2001 to reflect dilution from the sale of its packaging business. Since the timing and financial impact of the biomanufacturing divestiture are not yet certain, specific 2001 earnings guidance will not be provided at this time. However, management believes current analyst consensus estimates of $0.08/share for the first quarter and $0.46/share for the full year 2001 are achievable.

The Company recorded backlog of approximately $996 million on December 31, 2000, $932 million on September 30, 2000 and $957 million on December 31, 1999.

Net Days Sales Outstanding for the Company was 54 days on December 31, 2000 versus 61 days on September 30, and 52 days on December 31, 1999.

Covance's capital expenditures for 2000 were $96 million versus $111 million for 1999.

Net interest expense and non-operating adjustment

Net interest expense for the full year of 2000 was $19.1 million compared to $10.1 million in 1999. Increased interest expense in 2000 reflects higher average debt levels and interest rates, coupled with less interest income related to notes receivable from minority shareholders. Historically, Covance recognized interest income on loan agreements between the Company and the minority shareholders of Covance Biotechnology Services Inc. While these loans are not impaired and the accounting for the loan agreements had been reviewed and deemed appropriate by the Company's independent auditors in prior years and three quarters of 2000, they now believe the related non-operating interest income should not be reported in Covance's 2000 Income Statement. As a result, Covance has reduced pre-tax interest income by $1.8 million for the first nine months of 2000.

The Company's quarterly financial briefing will be webcast on January 31, 2001 at 9 am EST. Please log on to our website at www.covance.com to participate. A corresponding slideshow is also available on our website.

Covance, with headquarters in Princeton, New Jersey, is one of the world's largest and most comprehensive drug development services companies with 2000 revenues of $868 million, operations currently in 17 countries, and approximately 7,900 employees worldwide. Much more informtaion about Covance can be found throughout the site, including our products and services, other recent press releases, and SEC filings.

Statements contained in this press release, which are not historical facts, such as statements about prospective earnings, savings, revenue, earnings growth and other financial results are forward-looking statements pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All such forward-looking statements including the statements contained herein regarding anticipated trends in the Company's business are based largely on management's expectations and are subject to and qualified by risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. These risks and uncertainties include, without limitation, competitive factors, outsourcing trends in the pharmaceutical industry, the Company's ability to continue to attract and retain qualified personnel, the fixed price nature of contracts or the loss of large contracts, the success of the Company's restructuring, the Company's ability to divest businesses at a satisfactory price, Nexigent's ability to develop effective and comprehensive internet-enabled services and tools, demand for certain of the Company's Early Development services and other factors described in the Company's filings with the Securities and Exchange Commission. No assurance can be given that the Company will be able to realize the net revenues included in backlog. Covance believes that its aggregate backlog is not necessarily a meaningful indicator of future results.


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Financial Exhibits follow

                              COVANCE INC.
                              								
                               PROFORMA *
                               								
               INCOME STATEMENTS - EXCLUDING SPECIAL CHARGES
               								
         FOR THE THREE MONTHS AND YEARS ENDED DECEMBER 31, 2000 AND 1999
         								
               (Dollars in thousands, except per share data)
                                             
 								
                                  Three Months Ended December 31       Year Ended December 31
                                         2000 (a)           1999      2000 (b)       1999 (c)


Net revenues                             $231,396       $204,368      $868,087       $828,980 
								
Costs and expenses:
  Cost of revenue                         166,989        136,300       625,595        553,283 
  Selling, general & administrative        33,668         30,901       131,158        128,003 
  Depreciation and amortization            13,602         13,112        54,200         48,147 
     Total                                214,259        180,313       810,953        729,433 
								
Income from operations                     17,137         24,055        57,134         99,547 
								
Other expense, net:								
  Interest expense, net                     5,939          2,975        19,051         10,062 
  Other (income) expense                      560            (2)           598             57 
     Other expense, net                     6,499          2,973        19,649         10,119 
								
Income before taxes                        10,638         21,082        37,485         89,428 
								
Taxes on income                             4,191          8,326        14,615         35,829 
								
Net income                                 $6,447        $12,756       $22,870        $53,599 
								
Basic earnings per share                    $0.11          $0.22         $0.40          $0.91 
								
Weighted average shares outstanding    57,788,481     57,648,352    57,424,403     58,477,199 
     - basic								
Diluted earnings per share                  $0.11          $0.22         $0.40          $0.91 
								
Weighted average shares outstanding    57,819,347     57,704,825    57,492,384     58,680,794 
     - diluted

* Excluding special charges as set forth in note (a), (b) and (c) below.
								
(a) Income statement for the quarter ended December 31, 2000 excludes a net restructuring charge
reversal of $1,275 ($778 after tax).								
								
(b) Income statement for the year ended December 31, 2000 excludes a net restructuring charge of
$12,514 ($7,634 after tax) and reflects impact of YTD adjustment to interest income totaling $1,797
($1,095 after tax).
				
(c) Income statement for the year ended December 31, 1999 excludes a one-time charge incurred in Q2
1999 in connection with a terminated merger totaling $5,249 ($3,150 after tax) and a restructuring
charge incurred in Q3 1999 totaling $7,719 ($4,631 after tax).


                              COVANCE INC.
                              								
               INCOME STATEMENTS - INCLUDING SPECIAL CHARGES
               								
         FOR THE THREE MONTHS AND YEARS ENDED DECEMBER 31, 2000 AND 1999
         								
               (Dollars in thousands, except per share data)
                                             
 								
                                  Three Months Ended December 31       Year Ended December 31
                                             2000           1999      2000 (a)           1999 

Net revenues                             $231,396       $204,368      $868,087       $828,980 
								
Costs and expenses:
  Cost of revenue                         166,989        136,300       625,595        553,283 
  Selling, general and administrative      33,668         30,901       131,158        128,003 
  Depreciation and amortization            13,602         13,112        54,200         48,147 
  Restructuring charge                    (1,275)              -        12,514          7,719
  Merger-related costs                          -              -             -          5,249 
  Total                                   212,984        180,313       823,467        742,401 
								
Income from operations                     18,412         24,055        44,620         86,579 
								
Other expense, net:								
  Interest expense, net                     5,939          2,975        19,051         10,062 
  Other (income) expense                      560            (2)           598             57 
      Other expense, net                    6,499          2,973        19,649         10,119 

Income before taxes                        11,913         21,082        24,971         76,460 
								
Taxes on income                             4,688          8,326         9,735         30,642 
								
Net income                                 $7,225        $12,756       $15,236        $45,818 
								
Basic earnings per share                    $0.13          $0.22         $0.27          $0.78 
								
Weighted average shares outstanding    57,788,481     57,648,352    57,424,403     58,477,199
      - basic                       
								
Diluted earnings per share                  $0.12          $0.22         $0.26          $0.78 
								
Weighted average shares outstanding    57,819,347     57,704,825    57,492,384     58,680,794
      - diluted                     

(a) Income statement for the year ended December 31, 2000 reflects impact of YTD adjustment to
interest income totaling $1,797 ($1,095 after tax).


                                        COVANCE INC.
                                      
                                CONDENSED BALANCE SHEET DATA

                                 DECEMBER 31, 2000 AND 1999				
				
                                   (Dollars in thousands)				
			
				
                                                  December 31 2000   December 31 1999
CONDENSED BALANCE SHEET DATA				
				
  Cash and cash equivalents                                 $7,191            $25,444 
  Accounts and unbilled receivables                       $234,141           $192,327 
  Total Current Assets                                    $353,012           $302,124 
  Total Assets                                            $771,091           $689,721 

  Accounts Payable & Accrued Current Liabilities          $120,138           $104,559 
  Client Advances                                          $96,085            $75,531 
  Current portion of long-term debt and short-term debt    $11,499            $19,787 
  Revolving credit facility                               $224,000           $190,000 
  Long-term debt                                           $17,224            $18,724 
  Total Liabilities                                       $505,340           $437,662 
  Total Stockholders' Equity                              $265,751           $252,059 


                                     COVANCE INC.
                                     				
                               CONDENSED CASH FLOW DATA
                               				
                    FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
                    				
                               (Dollars in thousands)
                               
				
                                                                     Year Ended December 31
                                                                    2000               1999
CONDENSED CASH FLOW DATA				

  Cash flows from net earnings adjusted for non-cash activity    $66,722           $100,235
  Changes in operating assets and liabilities                   (17,969)           (21,206)
  Net cash provided by operating activities                       48,753             79,029
				
  Capital expenditures                                          (95,833)          (111,153)
				
  Contingent purchase price paid in connection                     (909)           (16,830)
     with prior acquisitions
     			
  Other, net                                                       1,208                975
				
  Net proceeds from debt                                          24,929             67,000
				
  Purchase of treasury stock                                       (329)           (19,578)
				
  Cash provided by stock issued under employee benefit plans       3,928              6,738
				
  Net change in cash and cash equivalents                       (18,253)              6,181
				
  Cash and cash equivalents, beginning of period                  25,444             19,263
				
  Cash and cash equivalents, end of period                        $7,191            $25,444