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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(Mark One)

|    |  |                                                                                        
|--- |  | ---------------------------------------------------------------------------------------
|[X] |  | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
|    |  | For the quarterly period ended September 30, 2002                                      

OR

|     |  |                                                                                         
|---- |  | ----------------------------------------------------------------------------------------
|[  ] |  | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
|     |  | For the transition period from ______to ______                                          

Commission file number 0-28194

DIGENE CORPORATION
(Exact name of registrant as specified in its charter)

|                                         |  |                                     
|---------------------------------------- |  | ------------------------------------
|Delaware                                 |  | 52-1536128                          
|                                         |  |                                     
|(State or other jurisdiction of          |  | (I.R.S. Employer Identification No.)
|incorporation or organization)           |  |                                     
|1201 Clopper Road                        |  |                                     
|Gaithersburg, Maryland                   |  | 20878                               
|                                         |  |                                     
|(Address of principal executive offices) |  | (Zip Code)                          

Registrants telephone number, including area code (301) 944-7000

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.  Yes X    No______

Indicate the number of shares outstanding of each of the issuers classes
of common stock, as of the latest practicable date.

|                                       |  |                          |            | 
|-------------------------------------- |  | ------------------------ | ---------- | 
|                                       |  | Shares outstanding as of
|Class                                  |  | November 8, 2002        
|                                       |  |                         
|Common Stock, par value $.01 per share |  |                          | 18,115,585 | 



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DIGENE CORPORATION

INDEX TO FORM 10-Q

|                                              |                                                                                               |                                                                                        |    |      |   | 
|--------------------------------------------- | --------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------- | -- | ---- | - | 
|                                              |                                                                                               |                                                                                        |    | Page
|                                              |                                                                                               |                                                                                        |    |     
|Part I.   Consolidated Financial Information: |                                                                                               |                                                                                        |    |     
|                                              | Item 1.Consolidated Financial Statements                                                      |                                                                                        |    |      |  
|                                              |                                                                                               | Consolidated Balance Sheets 
September 30, 2002 and June 30, 2002                     |    |      | 3 | 
|                                              |                                                                                               | Consolidated Statements of Operations 
Three months ended September 30, 2002 and 2001 |    |      | 4 | 
|                                              |                                                                                               | Consolidated Statements of Cash Flows 
Three months ended September 30, 2002 and 2001 |    |      | 5 | 
|                                              |                                                                                               | Notes to Consolidated Financial Statements                                             |    |      | 6 | 
|                                              | Item 2. Managements Discussion and Analysis of Financial Condition and
Results of Operations |                                                                                        |    | 9    |  
|                                              | Item 3. Quantitative and Qualitative Disclosures about Market Risk                            |                                                                                        |    | 15   |  
|                                              | Item 4.Controls and Procedures                                                                |                                                                                        |    | 15   |  
|Part II.   Other Information:                 |                                                                                               |                                                                                        |    |     
|                                              | Item 1.Legal Proceedings                                                                      |                                                                                        |    | 16   |  
|                                              | Item 2. Changes in Securities and Use of Proceeds                                             |                                                                                        |    | 17   |  
|                                              | Item 4.Submission of Matters to a Vote of Security Holders                                    |                                                                                        |    | 17   |  
|                                              | Item 6. Exhibits and Reports on Form 8-K                                                      |                                                                                        |    | 18   |  
|Signatures                                    |                                                                                               |                                                                                        | 19 |     
|Exhibit Index                                 |                                                                                               |                                                                                        | 22 |     





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PART I. Consolidated Financial Information

Item 1. Consolidated Financial Statements

DIGENE CORPORATION
CONSOLIDATED BALANCE SHEETS

|                                           |                                                                                                                                                                            |                                      |            |             |               |   |            |             |   |  | 
|------------------------------------------ | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------ | ---------- | ----------- | ------------- | - | ---------- | ----------- | - |  | 
|                                           |                                                                                                                                                                            |                                      |            |             | September 30, |   | June 30,  
|                                           |                                                                                                                                                                            |                                      |            |             | 2002          |   | 2002      
|                                           |                                                                                                                                                                            |                                      |            |             |               |   |           
|                                           |                                                                                                                                                                            |                                      |            |             | (Unaudited)   |   |            |             |  
|                                           |                                                                                                                                                                            |                                      | ASSETS     |             |               |   |            |             |   |  | 
|Current assets:                            |                                                                                                                                                                            |                                      |            |             |               |   |            |            
|                                           | Cash and cash equivalents                                                                                                                                                  |                                      | $          | 6,715,049   |               |   | $          | 9,453,125   |  
|                                           | Short-term investments                                                                                                                                                     |                                      |            | 26,833,010  |               |   |            | 30,140,114  |  
|                                           | Accounts receivable, less allowance of approximately $429,000 and
$684,000 at September 30, 2002 and June 30, 2002, respectively                                           |                                      |            | 7,570,129   |               |   |            | 9,001,584   |  
|                                           | Inventories                                                                                                                                                                |                                      |            | 5,733,210   |               |   |            | 5,980,386   |  
|                                           | Prepaid expenses and other current assets                                                                                                                                  |                                      |            | 2,073,939   |               |   |            | 2,195,264   |  
|                                           |                                                                                                                                                                            |                                      |            |             |               |   |            |            
|Total current assets                       |                                                                                                                                                                            |                                      | 48,925,337 |             |               |   | 56,770,473 |            
|Property and equipment, net                |                                                                                                                                                                            |                                      | 7,086,630  |             |               |   | 7,398,637  |            
|Deferred costs, net                        |                                                                                                                                                                            |                                      | 1,257,480  |             |               |   | 1,345,763  |            
|Intangible assets, net                     |                                                                                                                                                                            |                                      | 900,515    |             |               |   | 900,515    |            
|Deposits                                   |                                                                                                                                                                            |                                      | 812,992    |             |               |   | 825,941    |            
|                                           |                                                                                                                                                                            |                                      |            |             |               |   |            |            
|Total assets                               |                                                                                                                                                                            | $                                    | 58,982,954 |             |               | $ | 67,241,329 |            
|                                           |                                                                                                                                                                            |                                      |            |             |               |   |            |             |  
|                                           |                                                                                                                                                                            | LIABILITIES AND STOCKHOLDERS EQUITY |            |             |               |   |            |             |   | 
|Current liabilities:                       |                                                                                                                                                                            |                                      |            |             |               |   |            |            
|                                           | Accounts payable                                                                                                                                                           |                                      | $          | 3,276,664   |               |   | $          | 6,496,406   |  
|                                           | Accrued expenses                                                                                                                                                           |                                      |            | 3,631,773   |               |   |            | 5,628,706   |  
|                                           | Accrued payroll                                                                                                                                                            |                                      |            | 2,927,833   |               |   |            | 2,864,436   |  
|                                           | Current portion of long-term debt                                                                                                                                          |                                      |            | 1,344,635   |               |   |            | 1,377,856   |  
|                                           | Current portion of deferred revenues                                                                                                                                       |                                      |            | 575,091     |               |   |            | 575,091     |  
|                                           |                                                                                                                                                                            |                                      |            |             |               |   |            |            
|Total current liabilities                  |                                                                                                                                                                            |                                      | 11,755,996 |             |               |   | 16,942,495 |            
|Deferred rent                              |                                                                                                                                                                            |                                      | 378,184    |             |               |   | 353,076    |            
|Deferred revenue, less current portion     |                                                                                                                                                                            |                                      | 1,472,706  |             |               |   | 1,616,478  |            
|Long-term debt                             |                                                                                                                                                                            |                                      | 3,353,291  |             |               |   | 3,690,496  |            
|Deferred liability                         |                                                                                                                                                                            |                                      |           |             |               |   | 5,000,000  |            
|Stockholders equity:                      |                                                                                                                                                                            |                                      |            |             |               |   |            |            
|                                           | Preferred stock, $0.10 par value, 1,000,000 shares authorized, no shares
issued and outstanding                                                                            |                                      |            |            |               |   |            |            |  
|                                           | Common stock, $0.01 par value, 50,000,000 shares authorized, 18,115,585
and 17,972,728 shares issued and outstanding at September 30, 2002
and June 30, 2002, respectively |                                      |            | 181,156     |               |   |            | 179,727     |  
|                                           | Additional paid-in capital                                                                                                                                                 |                                      |            | 115,854,582 |               |   |            | 110,856,010 |  
|                                           | Deferred stock compensation                                                                                                                                                |                                      |            | (24,103     | )             |   |            | (32,137     | )
|                                           | Accumulated deficit                                                                                                                                                        |                                      |            | (73,988,858 | )             |   |            | (71,364,816 | )
|                                           |                                                                                                                                                                            |                                      |            |             |               |   |            |            
|Total stockholders equity                 |                                                                                                                                                                            |                                      | 42,022,777 |             |               |   | 39,638,784 |            
|                                           |                                                                                                                                                                            |                                      |            |             |               |   |            |            
|Total liabilities and stockholders equity |                                                                                                                                                                            | $                                    | 58,982,954 |             |               | $ | 67,241,329 |            
|                                           |                                                                                                                                                                            |                                      |            |             |               |   |            |             |  

See accompanying notes.

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DIGENE CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS

|                                         |                                   |   |                    |            |      |   |            |           |  
|---------------------------------------- | --------------------------------- | - | ------------------ | ---------- | ---- | - | ---------- | --------- | -
|                                         |                                   |   | Three Months Ended
|                                         |                                   |   | September 30,     
|                                         |                                   |   |                   
|                                         |                                   |   | 2002               |            | 2001
|                                         |                                   |   |                    |            |     
|                                         |                                   |   | (Unaudited)       
|Revenues:                                |                                   |   |                    |            |      |   |            |          
|                                         | Product sales                     |   | $                  | 12,396,804 |      |   | $          | 9,972,559 |  
|                                         | Distribution contract             |   |                    |           |      |   |            | 326,424   |  
|                                         | Other                             |   |                    | 219,683    |      |   |            | 83,257    |  
|                                         |                                   |   |                    |            |      |   |            |          
|Total revenues                           |                                   |   | 12,616,487         |            |      |   | 10,382,240 |          
|Costs and expenses:                      |                                   |   |                    |            |      |   |            |          
|                                         | Cost of product sales             |   |                    | 3,175,339  |      |   |            | 3,021,033 |  
|                                         | Research and development          |   |                    | 2,040,391  |      |   |            | 2,073,784 |  
|                                         | Selling and marketing             |   |                    | 6,035,793  |      |   |            | 3,812,264 |  
|                                         | General and administrative        |   |                    | 4,084,986  |      |   |            | 2,062,601 |  
|                                         | Amortization of intangible assets |   |                    |           |      |   |            | 37,521    |  
|                                         |                                   |   |                    |            |      |   |            |          
|Loss from operations                     |                                   |   | (2,720,022         | )          |      |   | (624,963   | )        
|Other income (expense):                  |                                   |   |                    |            |      |   |            |          
|                                         | Other income (expense)            |   |                    | 55,733     |      |   |            | (66,274   | )
|                                         | Interest income                   |   |                    | 179,377    |      |   |            | 206,670   |  
|                                         | Interest expense                  |   |                    | (66,976    | )    |   |            | (2,555    | )
|                                         |                                   |   |                    |            |      |   |            |          
|Loss from operations before income taxes |                                   |   | (2,551,888         | )          |      |   | (487,122   | )        
|Provision for income taxes               |                                   |   | 72,154             |            |      |   | 47,883     |          
|                                         |                                   |   |                    |            |      |   |            |          
|Net loss                                 |                                   | $ | (2,624,042         | )          |      | $ | (535,005   | )        
|                                         |                                   |   |                    |            |      |   |            |           |  
|Basic and diluted net loss per share     |                                   | $ | (0.14              | )          |      | $ | (0.03      | )        
|                                         |                                   |   |                    |            |      |   |            |           |  
|Weighted average shares outstanding      |                                   |   | 18,115,585         |            |      |   | 16,791,577 |          
|                                         |                                   |   |                    |            |      |   |            |           |  

See accompanying notes.

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DIGENE CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS

|                                                     |                                                                                           |                                                         |                                           |            |                    |            |            |            |         |          |  
|---------------------------------------------------- | ----------------------------------------------------------------------------------------- | ------------------------------------------------------- | ----------------------------------------- | ---------- | ------------------ | ---------- | ---------- | ---------- | ------- | -------- | -
|                                                     |                                                                                           |                                                         |                                           |            | Three Months Ended
|                                                     |                                                                                           |                                                         |                                           |            | September 30,     
|                                                     |                                                                                           |                                                         |                                           |            |                   
|                                                     |                                                                                           |                                                         |                                           |            | 2002               |            | 2001      
|                                                     |                                                                                           |                                                         |                                           |            |                    |            |           
|                                                     |                                                                                           |                                                         |                                           |            | (Unaudited)       
|Operating activities                                 |                                                                                           |                                                         |                                           |            |                    |            |            |           
|                                                     | Net loss                                                                                  |                                                         | $                                         | (2,624,042 | )                  |            | $          | (535,005   | )      
|                                                     | Adjustments to reconcile net loss to net cash provided by
(used in) operating activities: |                                                         |                                           |            |                    |            |            |            |        
|                                                     |                                                                                           | Depreciation and amortization of property and equipment |                                           |            | 818,543            |            |            |            | 370,050 |         
|                                                     |                                                                                           | Amortization of intangible assets                       |                                           |            |                   |            |            |            | 37,521  |         
|                                                     |                                                                                           | Compensation expense related to stock options           |                                           |            | 8,034              |            |            |            | 8,034   |         
|                                                     |                                                                                           | Changes in operating assets and liabilities:            |                                           |            |                    |            |            |            |         |         
|                                                     |                                                                                           |                                                         | Accounts receivable                       |            |                    | 1,431,455  |            |            |         | 519,958  |  
|                                                     |                                                                                           |                                                         | Inventories                               |            |                    | 247,176    |            |            |         | (58,351  | )
|                                                     |                                                                                           |                                                         | Prepaid expenses and other current assets |            |                    | 121,325    |            |            |         | 355,532  |  
|                                                     |                                                                                           |                                                         | Deposits                                  |            |                    | 12,949     |            |            |         | (22,801  | )
|                                                     |                                                                                           |                                                         | Accounts payable                          |            |                    | (3,219,742 | )          |            |         | (371,932 | )
|                                                     |                                                                                           |                                                         | Accrued expenses                          |            |                    | (1,996,933 | )          |            |         | 574,896  |  
|                                                     |                                                                                           |                                                         | Accrued payroll                           |            |                    | 63,397     |            |            |         | 415,433  |  
|                                                     |                                                                                           |                                                         | Deferred revenues                         |            |                    | (143,772   | )          |            |         | 279,000  |  
|                                                     |                                                                                           |                                                         | Deferred rent                             |            |                    | 25,108     |            |            |         | 34,174   |  
|                                                     |                                                                                           |                                                         |                                           |            |                    |            |            |           
|Net cash (used in) provided by operating activities  |                                                                                           |                                                         | (5,256,502                                | )          |                    |            | 1,606,509  |           
|Investing activities                                 |                                                                                           |                                                         |                                           |            |                    |            |            |           
|                                                     | Purchases of short-term investments                                                       |                                                         |                                           | (1,022,450 | )                  |            |            | (4,590,546 | )      
|                                                     | Maturities of short-term investments                                                      |                                                         |                                           | 4,329,554  |                    |            |            | 4,644,993  |        
|                                                     | Capital expenditures                                                                      |                                                         |                                           | (418,253   | )                  |            |            | (324,796   | )      
|                                                     |                                                                                           |                                                         |                                           |            |                    |            |            |           
|Net cash provided by (used in) investing activities  |                                                                                           |                                                         | 2,888,851                                 |            |                    |            | (270,349   | )         
|Financing activities                                 |                                                                                           |                                                         |                                           |            |                    |            |            |           
|                                                     | Exercise of common stock options                                                          |                                                         |                                           |           |                    |            |            | 755,610    |        
|                                                     | Principal repayments of long-term debt                                                    |                                                         |                                           | (370,425   | )                  |            |            |           |        
|                                                     |                                                                                           |                                                         |                                           |            |                    |            |            |           
|Net cash (used in) provided by financing activities  |                                                                                           |                                                         | (370,425                                  | )          |                    |            | 755,610    |           
|                                                     |                                                                                           |                                                         |                                           |            |                    |            |            |           
|Net (decrease) increase in cash and cash equivalents |                                                                                           |                                                         | (2,738,076                                | )          |                    |            | 2,091,770  |           
|Cash and cash equivalents at beginning of period     |                                                                                           |                                                         | 9,453,125                                 |            |                    |            | 20,626,252 |           
|                                                     |                                                                                           |                                                         |                                           |            |                    |            |            |           
|Cash and cash equivalents at end of period           |                                                                                           | $                                                       | 6,715,049                                 |            |                    | $          | 22,718,022 |           
|                                                     |                                                                                           |                                                         |                                           |            |                    |            |            |            |        

See accompanying notes.

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DIGENE CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.     Basis of Presentation

The consolidated financial statements of Digene Corporation (Digene) for the
three-month periods ended September 30, 2002 and 2001 are unaudited and include
all adjustments which, in the opinion of management, are necessary to present
fairly the results of operations for the periods then ended. All such
adjustments are of a normal recurring nature. These consolidated financial
statements should be read in conjunction with the consolidated financial
statements and notes thereto included in our Annual Report on Form 10-K for the
year ended June 30, 2002 filed with the Securities and Exchange Commission.

The results of operations for any interim period are not necessarily indicative
of the results of operations for any other interim period or for a full fiscal
year.

2.     Inventories

Inventories are stated at the lower of cost or market on a standard cost basis,
which approximates average cost.

Inventories consist of the following:

|                     |  |               |            |          |  |   |            |  
|-------------------- |  | ------------- | ---------- | -------- |  | - | ---------- | -
|                     |  | September 30, |            | June 30,
|                     |  | 2002          |            | 2002    
|                     |  |               |            |         
|                     |  | (Unaudited)   |            |          |  |  
|Finished goods       |  | $             | 2,592,463  |          |  | $ | 2,388,153  |  
|Work in process      |  |               | 3,212,873  |          |  |   | 3,460,359  |  
|Raw materials        |  |               | 1,250,113  |          |  |   | 1,339,470  |  
|                     |  |               |            |          |  |   |            |  
|                     |  |               | 7,055,449  |          |  |   | 7,187,982  |  
|Obsolescence reserve |  |               | (1,322,239 | )        |  |   | (1,207,596 | )
|                     |  |               |            |          |  |   |            |  
|                     |  | $             | 5,733,210  |          |  | $ | 5,980,386  |  
|                     |  |               |            |          |  |   |            |  

3.     Distribution Agreement

On April 29, 2001, Digene entered into a letter agreement with Roche Molecular
Systems (the Roche Distribution Contract), which established Roche Molecular
Systems (Roche) as the co-exclusive distributor of our human papillomavirus
(HPV) products in Europe, Africa and the Middle East from May 1, 2001 through
June 30, 2002. In June 2002, Digene adopted as its sole strategy for the
distribution of its products in Europe, Africa and the Middle East, a
combination of direct distribution through its European infrastructure and the
use of local distributors and agents. On June 30, 2002, the term of the Roche
Distribution Contract expired, subject to a non-exclusive wind-down period.
Under the Roche Distribution Contract, Digene has the option, exercisable
within 30 days after December 31, 2002, to buy back from Roche equipment
purchased from
Digene by Roche and in use for HPV testing in customers laboratories on June
30, 2002. If Digene

6



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repurchases the equipment, the non-exclusive wind-down
period will expire on December 31, 2002. If Digene does not repurchase the
equipment, the non-exclusive wind-down period will extend to December 31, 2004.
In June 2002, as part of its strategic decision, Digene decided that it would
exercise the option to repurchase the equipment. The Roche Distribution
Contract sets the repurchase price for the equipment as the net selling price
less any amounts Roche has recorded as depreciation on a straight-line basis
over a four-year period. In recognition of the possible repurchase of the
equipment, commencing in the fourth quarter of 2002, Digene deferred
recognition of revenue from equipment sold to Roche. Equipment sold during this
time period had a sales price of $2.3 million and a cost of $1.4 million, which
amounts have been recorded as deferred revenue and deferred costs,
respectively. The deferred revenue and deferred costs are being amortized over
a four-year period to other revenue (as equipment rental) and selling and
marketing expenses, respectively. For the period ended September 30, 2002,
Digene recorded other revenue and selling and marketing expenses of $144,000
and $88,000, respectively related to the amortization of these balances.

Under the terms of the Roche Distribution Contract, Roche made a non-refundable
payment of $5.0 million to Digene, which was converted into 142,857 shares of
Digene common stock at a conversion price of $35 on July 1, 2002.

4.     Intangible Assets

In July 2002, the Company adopted Statement of Financial Accounting Standards
No. 142, Goodwill and Other Intangible Assets(SFAS 142), which requires
companies to stop amortizing goodwill and certain intangible assets with an
indefinite useful life. Instead, SFAS 142 requires that goodwill and
intangible assets deemed to have an indefinite useful life be reviewed for
impairment upon adoption of SFAS 142 (January 1, 2002) and annually thereafter.
The Company will perform its annual impairment review during the fourth quarter
of each year, commencing with the fourth quarter of fiscal 2003.

7



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Under SFAS 142, goodwill impairment is deemed to exist if the net book value of
a reporting unit (i.e., the level of the consolidated business at which
goodwill impairment is measured) exceeds its estimated fair value. This
methodology differs from the Companys previous policy, as permitted under
accounting standards existing at that time, of using discounted and
undiscounted future cash flows as a basis to determine if goodwill is
recoverable. There was no impact on the carrying value of the Companys
intangible assets upon adoption of SFAS 142. The Company does not have any
intangible assets, other than goodwill, which had a net book value of $903,321
at September 30, 2002.

The historical results of operations for the three months ended September 30,
2001 do not reflect the provisions of SFAS 142. Had the Company adopted SFAS 142
on July 1, 2001, the historical net loss would have been changed to the
adjusted amounts indicated below (in thousands):

|                               |  |                                       |          |                |  |                       |       |  
|------------------------------ |  | ------------------------------------- | -------- | -------------- |  | --------------------- | ----- | -
|                               |  | Three Months Ended September 30, 2001
|                               |  |                                      
|                               |  |                                       |          |                |  | Basic and diluted net
|                               |  | Net loss                              |          | loss per share
|                               |  |                                       |          |               
|As reported  historical basis |  | $                                     | (535,005 | )              |  | $                     | (0.03 | )
|Add: Goodwill amortization     |  |                                       | 37,521   |                |  |                       | 0.00  |  
|                               |  |                                       |          |                |  |                       |       |  
|Adjusted                       |  | $                                     | (497,484 | )              |  | $                     | (0.03 | )
|                               |  |                                       |          |                |  |                       |       |  

5.     Reclassifications

Certain prior year amounts have been reclassified to conform to current year
presentation.

8



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Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

The following discussion of our financial condition and results of operations
should be read in conjunction with our Consolidated Financial Statements and
the related Notes thereto included elsewhere in this report and in our Annual
Report on Form 10-K for the year ended June 30, 2002. Some of the information
that follows are not statements of historical fact, but merely reflect our
intent, belief or expectations regarding the anticipated effect of events,
circumstances and trends. Such statements should be considered as
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. We believe that our expectations are based on
reasonable assumptions within the bounds of our knowledge of our business and
operations. Factors that might cause or contribute to differences between our
expectations and actual results include: uncertainty of market acceptance of
our products by the worldwide medical community; uncertainty of future
profitability and cash generation from operations; our limited sales and
marketing experience; the extent of future expenditures for sales and marketing
programs; delay in or failure to obtain regulatory approvals for our products
in development; uncertainty regarding patents and proprietary rights in
connection with our products and products in development; dependence on
third-party reimbursement from government entities, managed care organizations,
and private insurance plans; risk that other companies may develop and market
HPV tests competitive with our own; risks inherent in international
transactions, including those relating to our expansion in Europe and
elsewhere; our ability to scale up our manufacturing to the extent product
sales increase; uncertainty of clinical trial results for our products in
development; our ability to obtain requisite additional financing to fund our
operations beyond calendar year 2003; and other factors as set forth under the
caption Additional Considerations in our Annual Report on Form 10-K for the
year ended June 30, 2002.

Overview

Since our incorporation in 1987, we have devoted substantially all of our
resources to developing, manufacturing and marketing our proprietary gene-based
testing systems using our patented Hybrid Capture® technology for the
screening, monitoring and diagnosis of human diseases. Since our inception, we
have incurred substantial operating losses, resulting principally from expenses
associated with our research and development programs, including preclinical
studies, clinical trials and regulatory submissions for our products, the
expansion of our manufacturing facilities and our global sales and marketing
activities.

Our revenues to a significant extent have been derived from the sales of our
HPV Tests, which, for fiscal year 2002, accounted for 74% of total revenues
and, for the three months ended September 30, 2002, accounted for 78% of total
revenues. We expect that the growing acceptance of our HPV Tests in both the
United States and abroad will continue to drive the growth in revenues from our
HPV Tests and testing services in the future.

In fiscal 2002, our gross margins improved substantially over the prior fiscal
year. In the coming fiscal year, we believe that we will be able to sustain
gross margins consistent with, or better than,

9



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fiscal 2002 as we continue to
scale up our manufacturing operations and realize expanded margins as a result
of our direct distribution efforts in Europe.

We believe that increasing our investment in sales and marketing and in
research and development is essential to allow us to capitalize more fully on
the potential of our HPV Test and our core technology. We expect to invest
heavily in our direct European distribution operation during fiscal 2003 and
beyond while also expanding our direct sales organization in the United States.
We also expect to moderately increase our expenditures in the development of
our next-generation Hybrid Capture platforms and clinical trial activities for
human papillomavirus screening in the coming fiscal year as compared to fiscal
2002.

Our sales and marketing expenditures have been and will continue to be focused
on accelerating the adoption of human papillomavirus testing worldwide. We
intend to capitalize on the growing acceptance of our HPV Test in the United
States and internationally by physicians, laboratories and health insurance
providers by materially increasing expenditures on sales and marketing over the
next several quarters. The increase in expenditures will be primarily directed
at expanded direct sales and marketing efforts in the United States and Europe.

We expect our general and administrative expenses will increase to provide
adequate infrastructure to support greater research and development and sales
and marketing activities, to pay the anticipated expenses associated with our
ongoing litigation matters and to support the overall growth of our business.

As a result of these anticipated increases in expenditures, we expect our
operating losses to continue through fiscal 2003 with a turn to profitability
near the end of fiscal 2003. There can be no assurance that we will meet this
goal.

Results of Operations

Product sales increased to approximately $12,397,000 for the three-month period
ended September 30, 2002 from approximately $9,973,000 for the corresponding
period in 2001. The increase was due primarily to a 42% growth in sales of our
HPV Tests and testing services over such sales in the corresponding period in
2001, partially offset by decreases in sales of equipment and non-core
products. The majority of the growth in HPV products sales was in the United
States (67% over such sales in the corresponding period in 2001), which was
partially offset by a decrease in product sales in Europe, Africa and the
Middle East.

During the first quarter of fiscal 2002, we recognized revenue of approximately
$326,000 related to minimum purchase guarantees under the Roche Distribution
Contract. Under the Roche Distribution Contract, Roche has no further minimum
purchase obligations after June 30, 2002, which may adversely affect our
product revenues unless this can be offset by increased product sales. Please
see Liquidity and Capital Resources below for a description of the Roche
Distribution Contract.

Other revenues include research and development contract revenues, equipment
rental revenues and licensing revenues. Other revenues increased to
approximately $220,000 for the three-month period ended September 30, 2002 from
approximately $83,000 for the corresponding period in 2001. The

10



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increase was
due primarily to the partial recognition of equipment sales in Europe, which
were initially deferred in the fourth quarter of fiscal 2002, and research and
development revenue under an existing contract.

Cost of product sales increased to approximately $3,175,000 for the three-month
period ended September 30, 2002 from approximately $3,021,000 for the
corresponding period in 2001. Gross margin on product sales increased to 74%
for the three-month period ended September 30, 2002 from 71% for the
corresponding period in 2001. The increase in gross margin percentage was due
primarily to increased sales of our test products, particularly HPV Tests,
principally in the United States where we sell such products directly. In
addition, European margins increased due to substantially lower sales of
equipment, which have lower margins than our test products, and pricing
increases as a result of our change primarily to a direct sales approach in the
region. The increase in gross margin on product sales was partially offset by
a charge of approximately $375,000 for damaged products taken as a result of a
refrigeration equipment failure, which represents the loss in excess of the
insured amount.

Research and development expenses decreased slightly to approximately
$2,040,000 for the three-month period ended September 30, 2002 from
approximately $2,074,000 for the corresponding period in 2001. Our research
and development activities focus on our platform technology, including
different or modified uses of such technology, and improvements to our
diagnostic test and equipment products. Because our research and development
expenditures tend to benefit multiple product offerings, we do not account for
research and development expenses on a per-product or per-disease target basis.

During the three-month period ended September 30, 2002, we focused our research
and development activities principally on: the development of our Rapid Capture
System for automated processing of our Hybrid Capture tests, related to HPV and
chlamydia and gonorrhea (CT/GC); activities related to the completion of the
Pre-Market Approval (PMA) Supplement Amendment that we submitted to the U.S.
Food and Drug Administration (FDA) in September 2002 to obtain pre-market
approval for the use of our Hybrid Capture 2 HPV Test as a primary cervical
cancer screening test, to be performed in conjunction with the Pap smear for
women ages 30 and older; the development of our universal collection medium
(UCM) that is expected to allow the simultaneous testing for HPV, CT/GC and
of other genetic and cellular material from a single patient sample; clinical
trials related to CT/GC testing for ThinPrep specimens; the research and
development of our next generation of Hybrid Capture technology, initially for
the detection of HPV and herpes simplex virus; and the evaluation of certain
molecular markers to complement our HPV Tests in cervical screening
applications.

As indicated above, as part of our research and development activities, we
submitted a PMA Supplement Amendment to the FDA in September 2002 to obtain
market approval for the use of our Hybrid Capture 2 HPV Test as a primary
cervical cancer screening test, to be performed in conjunction with the Pap
smear, for women ages 30 and older. We have provided additional information to
the FDA as requested through letters and at meetings with FDA.

Selling and marketing expenses increased to approximately $6,036,000 for the
three-month period ended September 30, 2002 from approximately $3,812,000 for
the corresponding period in 2001. The increase was due primarily to personnel
costs, which increased 78% for the three-month period,

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various marketing
programs and associated professional expenses, which increased 40% for the
three-month period, and royalty costs, which increased 32% for the three-month
period as a result of increased product revenues. In addition, depreciation
expense increased 175% for the three-month period due to the repurchase of
equipment placed with customers by Abbott Laboratories (Abbott) upon
expiration of the non-exclusive wind-down period of our distribution agreement
with Abbott (the Abbott Agreement), as described below. Geographically, the
majority of the increase in our selling and marketing expenses was incurred in
Europe, which increased approximately $1,126,000 (115%) over the corresponding
period in 2001 and in the United States, which increased approximately
$1,286,000 (58%) over the corresponding period in 2001. We expect our selling
and marketing expenses to continue to increase during fiscal 2003 as we
establish direct sales and marketing operations in Europe due to the
expiration, on April 30, 2002, of Abbotts non-exclusive distribution wind-down
period under the Abbott Agreement for our HPV and CT/GC products in Europe,
Africa and the Middle East and the expiration of the Roche Distribution
Contract on June 30, 2002, and as we expand our direct sales organization in
the United States to increase HPV product sales and commercialize our CT/GC
products.

General and administrative expenses increased to approximately $4,085,000 for
the three-month period ended September 30, 2002 from approximately $2,063,000
for the corresponding period in 2001. The increase was due primarily to a
$1,649,000 (369%) increase in professional fees, principally attributable to a
$1,355,000 increase in legal fees associated with various litigation matters;
insurance expense, which increased $112,000 (97%) for the three-month period,
principally related to directors and officers insurance coverage; and
personnel costs, which increased by $366,000 (27%). Geographically, the
majority of the increase in general and administrative expenses was incurred in
the United States, which increased approximately $1,628,000 (84%), due
primarily to the aforementioned litigation expenditures, over the corresponding
period in 2001 and Europe, which increased approximately $391,000 (757%) over
the corresponding period in 2001.

Interest income decreased to approximately $179,000 for the three-month period
ended September 30, 2002 from approximately $207,000 for the corresponding
period in 2001. The decrease was primarily due to lower interest rates in the
first three months of fiscal year 2003 compared to the corresponding period in
fiscal year 2002, partially offset by an increase in average cash balances in
the fiscal 2003 period.

Liquidity and Capital Resources

Since inception, our expenses have significantly exceeded our revenues,
resulting in an accumulated deficit of approximately $73,989,000 at September
30, 2002. We have funded our operations primarily through the sale of equity
securities and revenues from product sales and research and development
contracts. At September 30, 2002, we had cash, cash equivalents and short-term
investments aggregating approximately $33.5 million. We had negative cash
flows from
operations of approximately $5,254,000 for the three months ending September
30, 2002 as compared to positive cash flows from operations of approximately
$1,607,000 for the three months ending September 30, 2001. The negative cash
flow for the three months ending September 30, 2002 is primarily the result of
our scheduled payment under the Co-Promotion Agreement with Cytyc Corporation
(Cytyc) and non-recurring payments to professionals related to our terminated
merger transaction with Cytyc, all of which were accrued during fiscal 2002.
The positive cash flow for the

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three months ending September 30, 2001 is
partially a result of advance minimum sales payments from Roche under the Roche
Distribution Contract.

Capital expenditures increased to approximately $418,000 for the three months
ended September 30, 2002 from approximately $325,000 for the corresponding
period in 2001.

On April 29, 2001, we entered into a letter agreement with Roche Molecular
Systems (the Roche Distribution Contract), which established Roche Molecular
Systems (Roche) as the co-exclusive distributor of our HPV products in
Europe, Africa and the Middle East from May 1, 2001 through June 30, 2002. In
June 2002, we adopted as our sole strategy for the distribution of our products
in Europe, Africa and the Middle East, a combination of direct distribution
through our European infrastructure and the use of local distributors and
agents. On June 30, 2002, the term of the Roche Distribution Contract expired,
subject to a non-exclusive wind-down period. Under the Roche Distribution
Contract, we have the option, exercisable within 30 days after December 31,
2002, to buy back from Roche equipment purchased from us by Roche and in use
for HPV testing in customers laboratories on June 30, 2002. If we repurchase
the equipment, the non-exclusive wind-down period will expire on December 31,
2002. If we do not repurchase the equipment, the non-exclusive wind-down
period will extend to December 31, 2004. In June 2002, as part of our strategic
decision, we decided that we would exercise the option to repurchase the
equipment. The Roche Distribution Contract sets the repurchase price for the
equipment as the net selling price less any amounts recorded as depreciation on
a straight-line basis over a four-year period. In recognition of the possible
repurchase of the equipment, commencing in the fourth quarter of 2002, we
deferred recognition of revenue from equipment sold to Roche. Equipment sold
during this time period had a sales price of $2.3 million and a cost of $1.4
million, which amounts have been recorded as deferred revenue and deferred
costs, respectively. The deferred revenue and deferred costs are being
amortized over a four-year period to other revenue (as equipment rental) and
selling and marketing expenses, respectively. For the period ended September
30, 2002, we recorded other revenue and selling and marketing expenses of
$144,000 and $88,000, respectively, related to the amortization of these
balances.

Under the Roche Distribution Contract, Roche made a non-refundable payment of
$5.0 million to Digene, which was recorded as a deferred liability on the
Consolidated Balance Sheet as of June 30, 2002. On July 1, 2002, consistent
with the provisions of the Roche Distribution Contract, this payment was
converted into 142,857 shares of Digene common stock at a conversion price of
$35 per share.

We anticipate that working capital requirements will increase moderately for
the foreseeable future due to investment necessary to support our European
direct distribution operations, including the buy back from Roche of equipment
in Europe, as well as increasing accounts receivable as a result of expected
revenue growth. We have incurred negative cash flows from operations since our
inception, and have expended, and expect to continue to expend in the future,
substantial funds to complete our planned product development efforts, expand
our sales and marketing activities and expand our manufacturing capabilities.
We expect that our existing capital resources will be adequate to fund our
operations through calendar year 2003. Our future capital requirements and the
adequacy of available funds may change, however, based on numerous factors,
including our degree of success in commercializing our products, progress in
our product development efforts and the magnitude and scope of such efforts,
progress with preclinical studies and clinical trials, progress

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in our
regulatory affairs activities, the cost and timing of expansion of our
manufacturing capabilities, the development and maintenance of effective sales
and marketing activities, the cost of filing, prosecuting, defending and
enforcing patent claims and other intellectual property rights, competing
technological and market developments, and the development and maturation of
strategic alliances for the marketing of our products. To the extent that our
existing capital resources and funds generated from operations are insufficient
to meet current or planned operating requirements, we will be required to
obtain additional funds through equity or debt financing, strategic alliances
with corporate partners and others, or through other sources. We do not have
any committed sources of additional financing, and there can be no assurance
that additional funding, if necessary, will be available on acceptable terms,
if at all. If adequate funds are not available, we may be required to delay,
scale back or eliminate certain aspects of our operations or attempt to obtain
funds through arrangements with collaborative partners or others that may
require us to relinquish rights to certain of our technologies, product
candidates, products or potential markets. Under such conditions, our
business, financial condition and results of operations will be materially
adversely affected.

We have summarized below our material contractual obligations as of September
30, 2002 (in thousands):

|                                   |  |       |        |       |  |               |       |               |  |               |       |              |  |   |       |  |  |   |       | 
|---------------------------------- |  | ----- | ------ | ----- |  | ------------- | ----- | ------------- |  | ------------- | ----- | ------------ |  | - | ----- |  |  | - | ----- | 
|                                   |  |       |        |       |  | Less Than One |       | One to Three  |  | Four to Five  |       | After Five  
|                                   |  |       |        |       |  | Year (Fiscal  |       | Years (Fiscal |  | Years (Fiscal |       | Years (After
|Contractual Obligations            |  | Total |        | 2003) |  | 2004-2006)    |       | 2007-2008)    |  | Fiscal 2008) 
|                                   |  |       |        |       |  |               |       |               |  |              
|Long-term debt                     |  | $     | 3,353  |       |  | $             | 1,430 |               |  | $             | 1,691 |              |  | $ | 232   |  |  | $ |      | 
|Operating leases                   |  |       | 20,768 |       |  |               | 2,833 |               |  |               | 8,023 |              |  |   | 5,500 |  |  |   | 4,412 | 
|Total contractual cash obligations |  | $     | 24,121 |       |  | $             | 4,263 |               |  | $             | 9,714 |              |  | $ | 5,732 |  |  | $ | 4,412 | 

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Item 3. Quantitative and Qualitative Disclosures about Market Risk

We are subject to market risk associated with changes in foreign currency
exchange rates and interest rates. Our foreign currency exchange rate risk
comes from our operations in Europe and South America. The net impact of
foreign exchange activities on earnings was immaterial for the three-month
periods ended September 30, 2002 and 2001, respectively, however, we will
continue to assess the impact, if any, as we continue to implement the
distribution of our products in Europe through our direct infrastructure.
Interest rate exposure is primarily limited to the approximately $33,500,000 of
cash, cash equivalents and short-term investments owned by us. Such
investments are money market debt securities that generate interest income for
us on cash balances. We do not actively manage the risk of interest rate
fluctuations; however, such risk is mitigated by the relatively short-term,
less than twelve months, nature of certain investments. We do not consider the
present rate of inflation to have a significant impact on our business.

Item 4. Controls and Procedures

As of November 4, 2002, the principal executive officer and principal financial
officer evaluated Digenes controls and procedures related to its reporting and
disclosure obligations, as well as its internal controls. These officers have
concluded that these disclosure controls and procedures are sufficient to
provide that (a) material information relating to Digene, including its
consolidated subsidiaries, is made known to these officers by other employees
of Digene and its consolidated subsidiaries, particularly material information
related to the period for which this periodic report is being prepared; and (b)
this information is recorded, processed, summarized, evaluated and reported, as
applicable, within the time periods specified in the rules and forms
promulgated by the Securities and Exchange Commission (SEC).

There have been no significant changes in Digenes internal controls or in
other factors that could significantly affect these internal controls
subsequent to the date of the evaluation.

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PART II. Other Information

Item 1. Legal Proceedings

On November 19, 2001, we filed an action for patent infringement against
Ventana Medical Systems, Inc. The action was filed in the United States
District Court for the District of Delaware. In the action, we allege that
Ventana Medical Systems, Inc. has made, used, sold and/or offered for sale
products embodying our patented inventions thereby infringing our United States
Patent No. 4,849,332 entitled Human Papilloma Virus 35 Nucleic Acid
Hybridization Probes and Methods for Employing the Same and our United States
Patent No. 4,849,331 entitled Human Papilloma Virus 44 Nucleic Acid
Hybridization Probes and Methods for Employing the Same. We are seeking a
permanent injunction and monetary damages for past infringement. On September
25, 2002, Ventana Medical Systems, Inc. publicly announced that it had acquired
Beckman Coulter, Inc.s human papillomavirus business and corresponding assets,
including the assignment of the human papillomavirus intellectual property
portfolio acquired by Beckman Coulter, Inc. from Institut Pasteur through a
1991 sublicense agreement. On October 18, 2002 Digene filed a motion to amend
its complaint to add another third party as a co-defendant, as well as
additional claims against Ventana. The matter is currently being briefed,
after which Digenes motion will be considered by the Court.

On March 15, 2002, we filed an action for declaratory judgment against Enzo
Biochem, Inc. The action was filed in the United States District Court for the
District of Delaware. We filed this action after having received direct threats
from Enzo Biochem of infringement of U.S. Patent No. 6,221,581 entitled
Processes for Detecting Polynucleotides, Determining Genetic Mutations or
Defects in Genetic Material, Separating or Isolating Nucleic Acid of Interest
from Samples, and Useful Compositions of Matter and Multihybrid Complex
Compositions. We are seeking a judgment that the patent is invalid and has not
been infringed by us. On March 20, 2002, in response to our complaint, Enzo
Biochem filed a motion to dismiss our complaint for lack of subject matter
jurisdiction, based on assertions that Enzo Diagnostics, Inc. (a wholly owned
subsidiary of Enzo Biochem), not Enzo Biochem, was the holder of the patent in
question. On
the same day, Enzo Diagnostics, Inc. also filed a complaint for patent
infringement against us in the Delaware District Court. Enzo Diagnostics, Inc.
asserts in its complaint that we have infringed U.S. Patent No. 6,221,581
through the manufacture, sale and offer for sale of our Hybrid Capture
products. The two cases have now been consolidated and discovery has commenced.
We have filed counterclaims against Enzo Biochem for various business-related
tortious conduct. We do not believe we are infringing such patent and will go
forward with the action for declaratory judgment and continue vigorously
defending against Enzos claim of patent infringement.

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Item 2. Changes in Securities and Use of Proceeds

Under the Roche Distribution Contract, Roche made a non-refundable payment of
$5.0 million to Digene, which was recorded as a deferred liability on the
Consolidated Balance Sheet as of June 30, 2002. On July 1, 2002, consistent
with the provisions of the Roche Distribution Contract, this payment was
converted into 142,857 shares of Digene common stock at a conversion price of
$35 per share. The shares of common stock were issued in a private placement
transaction in reliance upon the exemption from the registration requirements
of the Securities Act of 1933 (the Securities Act) set forth in Section 4(2)
of the Securities Act and Rule 506 promulgated by the SEC under the Securities
Act. On October 15, 2002, we filed a Registration Statement on Form
S-3 to register the shares for resale by Roche, which Registration Statement
was declared effective by the SEC on October 24, 2002.

Item 4. Submission of Matters to a Vote of Security Holders

The following is a summary of the final voting results from the October 24,
2002 annual meeting of stockholders of Digene. The number of shares present in
person or by proxy at the annual meeting were 16,483,737, or 91% of the
outstanding shares of common stock.

1.     Election of Directors.

Three of Digenes seven directors had terms that expired, two of whom
stood for re-election at the annual meeting for three year terms expiring in
2005. These two directors, who are listed below, received the most votes cast
for the election of directors.

|                    |  |     |            |                    |  |  |         | 
|------------------- |  | --- | ---------- | ------------------ |  |  | ------- | 
|Name                |  | For |            | Withheld Authority
|                    |  |     |            |                   
|Evan Jones          |  |     | 15,848,444 |                    |  |  | 635,293 | 
|Cynthia L. Sullivan |  |     | 16,054,674 |                    |  |  | 429,063 | 

The following directors terms continued after the meeting: Charles M.
Fleischman, John H. Landon, Joseph M. Migliara and John J. Whitehead.

2.     Approval of an Amendment to the Amended and Restated 1999 Incentive
Plan.

Digene proposed an amendment to its Amended and Restated 1999 Incentive
Plan to increase the number of shares of common stock issuable under the Plan
from 3,000,000 to 4,000,000 shares. The proposal received the affirmative vote
of a majority of the votes present and entitled to be cast on the matter.

|                  |  |  |           | 
|----------------- |  |  | --------- | 
|For:              |  |  | 8,580,428 | 
|Against:          |  |  | 2,327,558 | 
|Abstain:          |  |  | 27,534    | 
|Broker Non-Votes: |  |  | 5,548,217 | 

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Item 6. Exhibits and Reports on Form 8-K

(a)        Exhibits:

|     |  |                                                                                                                                                                                                                
|---- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.1  |  | Amended and Restated Certificate of Incorporation (Incorporated by
reference to Exhibit 3.1 to Digenes Registration Statement on Form S-1
(File No. 333-2968)).                                               
|3.2  |  | Amended and Restated Bylaws (Incorporated by reference to Exhibit 3.2 to
Digenes Annual Report on Form 10-K for the year ended June 30, 1999).                                                                
|4.1  |  | Form of Common Stock Certificate (Incorporated by reference to Exhibit 4.1 to
Digenes Registration Statement on Form S-1 (File No. 333-2968)).                                                                
|4.2  |  | Stock Purchase Agreement between Digene and Roche Molecular Systems, Inc.
dated April 29, 2001 (Incorporated by reference to Exhibit 4.4 to Digenes
Registration Statement on Form S-3 (File No. 333-100555)).
|10.1 |  | Digenes Amended and Restated 1999 Incentive Plan, as amended.                                                                                                                                                 
|99.1 |  | Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
18 U.S.C. Section 1350, by Chief Executive Officer.                                                                                   
|99.2 |  | Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
18 U.S.C. Section 1350, by Chief Financial Officer.                                                                                   

(b)     Reports on Form 8-K:

Digene filed the following Current Reports on Form 8-K during the quarter ended
September 30, 2002:

|         |  |  |             |  |  |                |  |              |  |  |  | 
|-------- |  |  | ----------- |  |  | -------------- |  | ------------ |  |  |  | 
|Report   |  |  | Item(s) No. |  |  | Date of Report |  | Date Filed  
|         |  |  |             |  |  |                |  |             
|Form 8-K |  |  | 5           |  |  | June 30, 2002  |  | July 1, 2002

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

|                        |  |                                                                                                                                                                              
|----------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                        |  | DIGENE CORPORATION                                                                                                                                                           
|                       
|Date: November 14, 2002 |  | By: /s/  Charles M. Fleischman
       Charles M. Fleischman
       President, Chief Operating Officer and
       Chief Financial Officer
       (Principal Financial Officer)
|                       
|Date: November 14, 2002 |  | By: /s/  Joseph P. Slattery
       Joseph P. Slattery
       Senior Vice President, Finance and Information Systems
       (Principal Accounting Officer)                    

CERTIFICATIONS

I, Evan Jones, Chief Executive Officer, certify that:

1.     I have reviewed this quarterly report on Form 10-Q of Digene
Corporation;

2.     Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this
quarterly report;

3.     Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4.     The registrants other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:



| |                                                                                                                                                                                                                                                                                                        
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a)     designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this quarterly report
is being prepared;
|
| | (b)     evaluated the effectiveness of the registrants disclosure
controls and procedures as of a date within 90 days prior to the filing
date of this quarterly report (the Evaluation Date); and                                                                                                  

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| |                                                                                                                                                                                
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (c)     presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;

5.     The registrants other certifying officer and I have disclosed, based
on our most recent evaluation, to the registrants auditors and the audit
committee of registrants board of directors (or persons performing the
equivalent function):



| |                                                                                                                                                                                                                                                                                                       
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a)     all significant deficiencies in the design or operation of
internal controls which could adversely affect the registrants ability
to record, process, summarize and report financial data and have
identified for the registrants auditors any material weaknesses in
internal controls; and
|
| | (b)     any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrants internal
controls; and                                                                                                                                        

6.     The registrants other certifying officer and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date: November 14, 2002



| | /s/ Evan Jones
Evan Jones
Chief Executive Officer
| | -------------------------------------------------

I, Charles M. Fleischman, Chief Financial Officer, certify that:

1.     I have reviewed this quarterly report on Form 10-Q of Digene
Corporation;

2.     Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this
quarterly report;

3.     Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4.     The registrants other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:



| |                                                                                                                                                                                                                                                                                                        
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a)     designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this quarterly report
is being prepared;

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| |                                                                                                                                                                                                      
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (b)     evaluated the effectiveness of the registrants disclosure
controls and procedures as of a date within 90 days prior to the filing
date of this quarterly report (the Evaluation Date); and
|
| | (c)     presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;                      

5.     The registrants other certifying officer and I have disclosed, based
on our most recent evaluation, to the registrants auditors and the audit
committee of registrants board of directors (or persons performing the
equivalent function):



| |                                                                                                                                                                                                                                                                                                       
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a)     all significant deficiencies in the design or operation of
internal controls which could adversely affect the registrants ability
to record, process, summarize and report financial data and have
identified for the registrants auditors any material weaknesses in
internal controls; and
|
| | (b)     any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrants internal
controls; and                                                                                                                                        

6.     The registrants other certifying officer and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date: November 14, 2002



| | /s/ Charles M. Fleischman
Charles M. Fleischman
Chief Financial Officer
| | -----------------------------------------------------------------------

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EXHIBIT INDEX

|            |  |                                                                                                                                                                                                                 
|----------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Description                                                                                                                                                                                                     
|           
|3.1         |  | Amended and Restated Certificate of Incorporation (Incorporated
by reference to Exhibit 3.1 to Digenes Registration Statement on
Form S-1 (File No. 333-2968)).                                                
|3.2         |  | Amended and Restated Bylaws (Incorporated by reference to
Exhibit 3.2 to Digenes Annual Report on Form 10-K for the year ended
June 30, 1999).                                                                 
|4.1         |  | Form of Common Stock Certificate (Incorporated by reference to
Exhibit 4.1 to Digenes Registration Statement on Form S-1 (File No.
333-2968)).                                                                 
|4.2         |  | Stock Purchase Agreement between Digene and Roche Molecular
Systems, Inc., dated April 29, 2001 (Incorporated by reference to
Exhibit 4.4 to Digenes Registration Statement on Form S-3 (File No.
333-100555)).
|10.1        |  | Digenes Amended and Restated 1999 Incentive Plan, as amended.                                                                                                                                                  
|99.1        |  | Certification pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002, 18 U.S.C. Section 1350, by Chief Executive Officer.                                                                                    
|99.2        |  | Certification pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002, 18 U.S.C. Section 1350, by Chief Financial Officer.                                                                                    

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