<PAGE>

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

                                     FORM 10-Q




                                  QUARTERLY REPORT
                         PURSUANT TO SECTION 13 OR 15(d) OF
                      THE SECURITIES AND EXCHANGE ACT OF 1934

                    FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1998

                            COMMISSION FILE NO. 0-23659



                                    VYSIS, INC.
               (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)



               DELAWARE                                36-3803405
(STATE OR OTHER JURISDICTION OF         (I.R.S. EMPLOYER IDENTIFICATION NUMBER)
 INCORPORATION OR ORGANIZATION)


     3100 WOODCREEK DRIVE                              60515-5400
     DOWNERS GROVE, ILLINOIS                           (ZIP CODE)
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

           REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE:  (630) 271-7000




     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  
    ---           ---


Number of shares of Common Stock, par value $.001 per share, outstanding as of
July 31, 1998:  9,705,629

<PAGE>

                                 VYSIS, INC.

                                  FORM 10-Q

                 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1998

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                       PAGE
                                                                       ----
<S>                                                                    <C>
                        PART I:  FINANCIAL INFORMATION

ITEM 1: Financial Statements
          Consolidated Balance Sheet
            As of June 30, 1998 and December 31, 1997.................    2
          Consolidated Statement of Operations
            For the three months ended June 30, 1998 and 1997 ........    3
          Consolidated Statement of Operations
            For the six months ended June 30, 1998 and 1997 ..........    4
          Consolidated Statement of Cash Flows
            For the six months ended June 30, 1998 and 1997 ..........    5
          Notes to Consolidated Financial Statements .................   6-8

ITEM 2: Management's Discussion and Analysis of Financial Condition
        and Results of Operations ....................................  8-12

                        PART II:  OTHER INFORMATION

ITEM 1: Legal Proceedings ............................................   13

ITEM 2: Changes in Securities and Use of Proceeds .................... 13-14

ITEM 6: Exhibits and Reports on Form 8-K .............................   14

SIGNATURE ............................................................   15
</TABLE>


                                      1
<PAGE>

                        PART I. FINANCIAL INFORMATION
                         ITEM 1. FINANCIAL STATEMENTS

                                 VYSIS, INC.
                (AN INDIRECT SUBSIDIARY OF AMOCO CORPORATION)

                          CONSOLIDATED BALANCE SHEET

                     (IN THOUSANDS, EXCEPT SHARE AMOUNTS)
                                 (UNAUDITED)


<TABLE>
<CAPTION>
                                                                 JUNE 30,  DECEMBER 31,
                                                                   1998        1997
                                                                 --------  ------------
<S>                                                              <C>       <C>
ASSETS
Current assets:
  Cash and cash equivalents ..................................   $ 10,483    $    669
  Short-term investments .....................................     13,346          --
  Accounts receivable, net ...................................      6,386       4,629
  Inventories ................................................      2,840       2,733
  Other current assets .......................................        895       1,108
                                                                 --------  ------------
    Total current assets .....................................     33,950       9,139
Property and equipment, net ..................................      4,335       4,646
Investment ...................................................        513         677
Other assets .................................................      2,092       2,478
                                                                 --------  ------------
    Total assets .............................................   $ 40,890    $ 16,940
                                                                 --------  ------------
                                                                 --------  ------------

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
  Accounts payable and accrued liabilities ...................   $  8,286    $  8,538
  Note payable--Amoco ........................................         --       9,202
  Deferred revenue ...........................................        270         537
                                                                 --------  ------------
    Total current liabilities ................................      8,556      18,277
                                                                 --------  ------------

Stockholders' equity (deficit):
  Convertible Preferred Stock, $0.001 par value;
    10,000,000 shares authorized:
    Series A; 6,200,000 shares designated; none 
    issued and outstanding at June  30, 1998;
    6,200,000 issued and outstanding at December 31, 1997 .....        --           6
    Series B; 553,126 shares designated; none issued and 
    outstanding at June 30, 1998; 553,126 issued and
    outstanding at December 31, 1997 ..........................        --           1
  Common stock, $0.001 par value; 35,000,000 shares
    authorized; 9,711,211 issued and outstanding at
    June 30, 1998; 1,071,970 issued and outstanding at
    December 31, 1997 .........................................        10           1
  Additional paid-in capital ..................................    71,670      30,396
  Deferred compensation .......................................      (144)       (206)
  Unrealized gains on investment ..............................       413         577
  Cumulative translation adjustment ...........................      (146)       (241)
  Accumulated deficit .........................................   (39,469)    (31,871)
                                                                 --------  ------------
    Total stockholders' equity (deficit) ......................    32,334      (1,337)
                                                                 --------  ------------
    Total liabilities and stockholders' equity ................  $ 40,890    $ 16,940
                                                                 --------  ------------
                                                                 --------  ------------
</TABLE>

   The accompanying notes are an integral part of these financial statements.


                                      2
<PAGE>

                                  VYSIS, INC.
                  (AN INDIRECT SUBSIDIARY OF AMOCO CORPORATION)

                       CONSOLIDATED STATEMENT OF OPERATIONS

                      (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
                                 (UNAUDITED)

<TABLE>
<CAPTION>
                                                   THREE MONTHS ENDED JUNE 30,
                                                   ---------------------------
                                                      1998             1997
                                                   ----------       ----------
<S>                                                <C>              <C>
Revenues:
  Product sales ..............................       $ 6,286          $ 3,646
  Grant and other revenues ...................           780              601
                                                   ----------       ----------
    Total revenues ...........................         7,066            4,247
Cost of goods sold ...........................         2,596            1,619
                                                   ----------       ----------
Gross profit .................................         4,470            2,628
                                                   ----------       ----------
Operating expenses:
  Research and development ...................         2,900            2,753
  Selling, general and administrative ........         4,937            3,797
                                                   ----------       ----------
    Total operating expenses .................         7,837            6,550
                                                   ----------       ----------
Loss from operations .........................        (3,367)          (3,922)
Interest income ..............................           359               --
Interest expense .............................           (39)             (90)
                                                   ----------       ----------
Net loss .....................................       $(3,047)         $(4,012)
                                                   ----------       ----------
                                                   ----------       ----------
Basic and diluted net loss per share .........       $ (0.31)         $ (3.79)
                                                   ----------       ----------
                                                   ----------       ----------
Shares used in computing basic and diluted
  net loss per share .........................         9,700            1,058
</TABLE>


   The accompanying notes are an integral part of these financial statements.


                                      3
<PAGE>

                                 VYSIS, INC.
                (AN INDIRECT SUBSIDIARY OF AMOCO CORPORATION)

                      CONSOLIDATED STATEMENT OF OPERATIONS

                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                     SIX MONTHS ENDED JUNE 30,
                                                     -------------------------
                                                       1998             1997
                                                     --------         --------
<S>                                                  <C>              <C>
Revenues:
  Product sales ..................................    $10,845          $ 6,931
  Grant and other revenues .......................      1,272            1,136
                                                     --------         --------
    Total revenues ...............................     12,117            8,067
Cost of goods sold ...............................      4,420            3,184
                                                     --------         --------
Gross profit .....................................      7,697            4,883
                                                     --------         --------
Operating expenses:
  Research and development .......................      5,366            5,313
  Selling, general and administrative ............     10,331            7,077
                                                     --------         --------
    Total operating expenses .....................     15,697           12,390
                                                     --------         --------
Loss from operations .............................     (8,000)          (7,507)
Interest income ..................................        572               --
Interest expense .................................       (170)            (122)
                                                     --------         --------
Net loss .........................................    $(7,598)         $(7,629)
                                                     --------         --------
                                                     --------         --------
Basic and diluted net loss per share .............    $ (0.98)         $ (7.21)
                                                     --------         --------
                                                     --------         --------
Shares used in computing basic and diluted
  net loss per share .............................      7,739            1,058

Pro forma basic and diluted net loss per share ...    $ (0.83)
                                                     -------- 
                                                     -------- 
Shares used in computing pro forma basic and
  diluted net loss per share .....................      9,009
</TABLE>


   The accompanying notes are an integral part of these financial statements.


                                      4
<PAGE>

                                  VYSIS, INC.
                 (AN INDIRECT SUBSIDIARY OF AMOCO CORPORATION)

                      CONSOLIDATED STATEMENT OF CASH FLOWS

                                 (IN THOUSANDS)
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                            SIX MONTHS ENDED JUNE 30,
                                                           --------------------------
                                                             1998              1997
                                                           --------          --------
<S>                                                        <C>               <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net loss ...........................................     $ (7,598)          $(7,629)
  Reconciliation of net loss to net cash used 
    in operating activities:
    Depreciation and amortization ....................        1,364             1,676
    Stock compensation ...............................           82                52
    Changes in assets and liabilities:
      Accounts receivable ............................       (1,759)             (190)
      Inventories ....................................          (28)             (291)
      Other current assets ...........................          294               (32)
      Other assets ...................................         (180)               --
      Accounts payable and accrued liabilities .......         (281)             (355)
      Deferred revenue ...............................         (180)             (313)
                                                           --------          --------
    Net cash used in operating activities ............       (8,286)           (7,082)
                                                           --------          --------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Purchases of short-term investments ................      (13,346)               --
  Purchases of property and equipment ................         (423)             (200)
  Increase in other assets ...........................         (102)             (296)
                                                           --------          --------
    Net cash used in investing activities ............      (13,871)             (496)
                                                           --------          --------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from issuance of common stock .............       32,161                --
  Increase in note payable--Amoco ....................        1,665             7,512
  Expenses funded by Amoco ...........................          153               245
  Loan repayment to Amoco ............................       (2,000)               --
                                                           --------          --------
    Net cash provided by financing activities ........       31,979             7,757
Effect of exchange rate changes on cash ..............           (8)              (56)
                                                           --------          --------
Net increase in cash .................................        9,814               123
Cash and cash equivalents at beginning of period .....          669                48
                                                           --------          --------
Cash and cash equivalents at end of period ...........     $ 10,483           $   171
                                                           --------          --------
                                                           --------          --------
</TABLE>


   The accompanying notes are an integral part of these financial statements.


                                      5
<PAGE>

                                  VYSIS, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  (UNAUDITED)

NOTE 1--ORGANIZATION AND BUSINESS:

     Vysis, Inc. ("Vysis" or the "Company") was incorporated in Delaware in 
1991.  The Company's principal stockholder is Amoco Technology Company 
("ATC"), which is a wholly owned subsidiary of Amoco Corporation ("Amoco").  
In 1991, ATC acquired from Genzyme its remaining interest in Gene-Trak 
Systems, a joint venture focused on infectious disease diagnostics originally 
formed by Amoco and Integrated Genetics in 1986, and established Gene-Trak, 
Inc., a Delaware corporation, which at that time was named Gene-Trak Systems 
Corporation.  In March 1994, ATC contributed all of its infectious disease 
business related assets and the stock of Gene-Trak, Inc. to the Company.  
Also, in March 1994, ATC contributed to the Company all of its genetic 
disease business related assets, including the stock of Vysis, Inc., an 
Illinois corporation, which at that time was named Imagenetics Incorporated.  
In January 1995, ATC contributed to the Company all of the assets of its 
bioinformatics software activities.  All assets contributed by Amoco were 
recorded by the Company at Amoco's net book value at the date of transfer.  
All references to Amoco shall mean Amoco Corporation, an Indiana corporation, 
and its wholly owned subsidiary, Amoco Technology Company, a Delaware 
corporation.

     Vysis is a genomic disease management company focused on developing and 
marketing clinical products to assess the structure and function of the human 
genome.  The Company's DNA probe technologies provide the clinician with an 
enhanced ability to manage disease by assessing the human genome at all 
levels, including the ability to determine the presence, absence, number and 
structure of chromosomes, individual genes, and specific base pair mutations 
within genes. The Company currently markets its genomic testing products for 
research and clinical use and markets its food testing products for 
commercial use.

     The Company completed an initial public offering of 3,000,000 shares of 
its Common Stock (the "Offering") on February 10, 1998, resulting in net cash 
proceeds of approximately $32.1 million.  In connection with the Offering, 
6,200,000 and 553,126 shares of Series A and Series B Convertible Preferred 
Stock, respectively, automatically converted into 4,525,547 and 403,741 
shares of Common Stock, respectively.  In addition, concurrent with the 
completion of the Offering, the Company converted $8.1 million of the note 
payable-Amoco, which was net of a capital contribution of approximately $1 
million related to the tax effect of including the Company's results of 
operations through February 10, 1998 in Amoco's consolidated federal income 
tax return, into 675,000 shares of Common Stock and repaid the remaining note 
balance of $2.0 million.  Upon completion of the Offering, the Company had 
approximately 9.7 million shares of Common Stock issued and outstanding.


                                      6
<PAGE>

                                  VYSIS, INC.

                NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
                                  (UNAUDITED)

NOTE 2--FINANCIAL INFORMATION:

     The unaudited interim consolidated financial statements of the Company 
have been prepared pursuant to the rules and regulations of the Securities 
and Exchange Commission.  Accordingly, certain information and footnote 
disclosures normally included in financial statements prepared in accordance 
with generally accepted accounting principles have been condensed or omitted. 
These interim consolidated financial statements should be read in 
conjunction with the consolidated financial statements and notes thereto 
included in the Company's Annual Report on Form 10-K for the year ended 
December 31, 1997 and the Company's Quarterly Report on Form 10-Q for the 
three months ended March 31, 1998, as filed with the Securities and Exchange 
Commission.

     In the opinion of management, the interim consolidated financial 
statements reflect all adjustments necessary for a fair presentation of the 
interim periods.  All such adjustments are of a normal, recurring nature.  
The results of operations for the interim periods are not necessarily 
indicative of the results of operations to be expected for a full year.

NOTE 3--NET LOSS PER SHARE:

     In 1997, the Company adopted SFAS No. 128, "Earnings Per Share," which 
requires presentation of both basic and diluted earnings per share.  Basic 
earnings per share is computed using the weighted average number of shares of 
common stock outstanding during the period.  Diluted earnings per share also 
includes the impact of potential common shares during the period.  No 
reconciliation is presented of basic and diluted net loss per share as 
potential common shares are antidilutive.  Certain prior period amounts have 
been restated in accordance with SFAS No. 128.

     Pro forma net loss per share for the six months ended June 30, 1998 was 
calculated using the weighted average number of common shares outstanding 
during the period, adjusted for the conversion of the Series A and Series B 
Convertible Preferred Stock into 4,929,288 shares of Common Stock and for the 
conversion of $8.1 million of the note payable-Amoco into 675,000 shares of 
Common Stock, all as of January 1, 1998.

NOTE 4--RECENT ACCOUNTING PRONOUNCEMENTS:

     In June 1997, the Financial Accounting Standards Board issued SFAS No. 
131, "Disclosures About Segments of an Enterprise and Related Information."  
SFAS No. 131 establishes new standards for reporting information about 
operating segments in interim and annual financial statements.  SFAS No. 131 
will be effective for the Company's annual reporting requirements for the 
1998 fiscal year.  The Company is currently 


                                      7
<PAGE>

                                  VYSIS, INC.

                NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
                                  (UNAUDITED)

evaluating the impact, if any, this statement will have on disclosures in the 
notes to its consolidated financial statements.

     In June 1998, the Financial Accounting Standards Board issued SFAS No. 
133, "Accounting for Derivative Instruments and Hedging Activities."  SFAS 
No. 133 is effective for all fiscal quarters of all fiscal years beginning 
after June 15, 1999 and requires that all derivative instruments be recorded 
on the balance sheet at their fair value.  Management of the Company 
anticipates that, because it does not employ derivative instruments, the 
adoption of SFAS No. 133 will not have a significant effect on the Company's 
results of operations or its financial position.

NOTE 5--COMPOSITION OF BALANCE SHEET COMPONENT:

     Inventories consisted of the following (in thousands):

<TABLE>
<CAPTION>
                                                           June 30,     December 31,
                                                             1998           1997
                                                           --------     ------------
<S>                                                        <C>          <C>
     Raw materials and supplies ......................      $1,045         $1,198
     Finished goods ..................................       1,795          1,535
                                                           --------     ------------
                                                            $2,840         $2,733
                                                           --------     ------------
                                                           --------     ------------
</TABLE>

NOTE 6--COMPREHENSIVE INCOME:

     Effective January 1, 1998, the Company adopted Statement of Financial 
Accounting Standards No. 130, "Reporting Comprehensive Income."  This 
Statement requires that all items recognized under accounting standards as 
components of comprehensive earnings be reported in interim and annual 
financial statements in the same prominence as other interim and annual 
financial statements.  This Statement also requires that an entity classify 
items of other comprehensive earnings by their nature in interim and annual 
financial statements. Other comprehensive earnings includes foreign currency 
translation adjustments and unrealized gains and losses on investments 
classified as available-for-sale.  No statement of comprehensive earnings is 
presented as the effect of the adoption of this Standard is immaterial to the 
consolidated financial statements and notes thereto.

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL 
              CONDITION AND RESULTS OF OPERATIONS

     The following discussion and analysis provides information which 
management believes is relevant to an assessment and understanding of the 
Company's results and


                                      8
<PAGE>

                                  VYSIS, INC.

              MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL 
               CONDITION AND RESULTS OF OPERATIONS--(CONTINUED)

financial condition.  The discussion should be read in conjunction with the 
audited consolidated financial statements of the Company and notes thereto, 
which were included in the Company's Annual Report on Form 10-K for the year 
ended December 31, 1997 as well as the financial statements of the Company 
and notes thereto, which were included in the Company's Quarterly Report on 
Form 10-Q for the three months ended March 31, 1998.  This Form 10-Q contains 
certain statements which describe the Company's beliefs concerning future 
business conditions and the outlook for the Company based on currently 
available information.  Whenever possible, the Company has identified these 
"forward-looking" statements (as defined in Section 21E of the Securities 
Exchange Act of 1934) by words such as "anticipates", "believes", 
"estimates", "expects", and similar expressions.  These forward-looking 
statements are subject to risks and uncertainties which could cause the 
Company's actual results, performance and achievements to differ materially 
from those expressed in or implied by these statements.  These risks and 
uncertainties include, but are not limited to, the following: the acceptance 
of DNA based genetic probes by the medical community, the receipt by the 
Company of necessary regulatory approvals in a timely fashion, compliance by 
the Company with regulatory requirements, dependence by the Company on gene 
discovery and disease correlation efforts of others, the acquisition by the 
Company of rights to develop tests utilizing intellectual property of others, 
uncertainties relating to the development of new technologies, dependence on 
the success of collaborative partners and the Company's success in defending 
its own intellectual property rights and avoiding infringing those of others.

OVERVIEW

     Vysis is a leading genomic disease management company that develops, 
commercializes and markets clinical products that provide information 
critical to the evaluation and management of cancer, prenatal disorders and 
other genetic diseases.  During March 1998, the Company received registration 
from the Agence du Medicament ("ADM") to market throughout Europe the 
AneuVysion-TM- EC Assay for Down Syndrome and other chromosomal disorders 
associated with mental retardation and birth defects.  The Company has a 
pending application for registration with the ADM to market CEP-Registered 
Trademark- X SpectrumOrange-TM-/Y SpectrumGreen-TM- ("CEP X/Y"), 
CEP-Registered Trademark- 8 SpectrumOrange-TM-("CEP 8") and CEP-Registered 
Trademark- 12 SpectrumOrange-TM- ("CEP 12") DNA Probe Kits, in vitro 
diagnostics, for use as adjuncts to standard cytogenetic analysis to identify 
and enumerate the presence of chromosomes X, Y, 8 and 12 in bone marrow and 
blood specimens, thus aiding in the diagnosis and treatment of leukemia 
patients.  During June 1998, the Company filed a premarket approval ("PMA") 
application with the U.S. Food and Drug Administration ("FDA") for a breast 
cancer test, the PathVysion-TM- HER-2/neu DNA probe kit, which is intended to 
rapidly assess the amplification of the HER-2/neu gene for use as a 
predictive marker for response to chemotherapy.  Vysis currently markets five 
FDA cleared clinical products, including the U.S. versions of CEP X/Y, CEP 8 
and CEP 12 and AneuVysion-TM- which received 510(k) clearance by the FDA 
during 1997, in addition to distributing over 290 research products through 
its direct sales 

                                      9
<PAGE>

                                  VYSIS, INC.

              MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL 
               CONDITION AND RESULTS OF OPERATIONS--(CONTINUED)

operations in the United States and Europe and a worldwide distribution 
network covering 41 countries.  It also markets proprietary genetic imaging 
workstations for clinical and research use, with an installed base of over 
510 proprietary genetic workstations in 21 countries.  The Company also 
develops, manufactures and commercializes products used by food processors 
and quality control laboratories for the detection and identification of 
food-borne pathogens.

RESULTS OF OPERATIONS

     Total revenues for the three months ending June 30, 1998 increased 66% 
to $7.1 million compared to the second quarter of 1997.  This increase was 
the result of a 72% increase in product sales, slightly offset by a 30% 
increase in grant and other revenues.  For the six months ended June 30, 
1998, total revenues increased 50% to $12.1 million compared to the first 
half of 1997. This increase for the first six months was the result of a 56% 
increase in product sales, partially offset by a 12% increase in grant and 
other revenues. Sales of the Company's genetic testing products increased 86% 
and 68% for the three months and six months ended June 30, 1998, 
respectively, in comparison to the related prior year periods. This genetic 
testing product sales increase accounted for the growth in product revenues 
during the second quarter as well as the first half of 1998, which were 
primarily the result of an increased number of shipments of Vysis genetic 
testing research and clinical reagents to both domestic and international 
customers.  In addition, the increase in genetic testing product revenues 
during the three and six months ended June 30, 1998 was partially the result 
of sales attributable to receiving the assets of Oncor, Inc.'s ("Oncor") 
non-oncology Fluorescence in situ Hybridization ("FISH") business as part of 
a definitive agreement signed April 9, 1998, which ended a patent 
infringement suit brought by the Company, as exclusive licensee, and its 
licensor.  See Item 1 in Part II for further discussion of the settlement. 
Sales of the Company's food testing products for the three and six months 
ended June 30, 1998 were relatively flat compared to the same periods in the 
prior year.  For the three and six months ended June 30, 1998, grant and 
other revenues increased $.2 million and $.1 million, respectively, in 
comparison to respective prior year periods primarily due to $.4 million of 
nonrecurring license and other revenue related to the Oncor agreement.  These 
were partially offset by a reduction in grant revenue resulting from the 
completion of one of two United States Department of Commerce research 
grants.

     Cost of goods sold increased to $2.6 million and $4.4 million for the 
three and six months ended June 30, 1998, respectively, from $1.6 million and 
$3.2 million for the comparative 1997 periods.  These increases in cost of 
goods sold resulted from an increase in the volume of products sold.  As a 
percentage of total revenue, gross profit increased to 63.3% and 63.5% for 
the three and six months ended June 30, 1998, respectively, from 61.9% and 
60.5% for the three and six months ended June 30, 1997, respectively.  These 
increases, offset by the decrease in grant revenue as a percentage of total 
revenues, were primarily attributable to a shift in the product mix of 
genetic testing products.  During the three and six months ended June 30, 
1998, higher margin reagent 


                                      10
<PAGE>

                                  VYSIS, INC.

              MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL 
               CONDITION AND RESULTS OF OPERATIONS--(CONTINUED)

sales accounted for a larger percentage of the Company's total product 
revenues than did lower margin instrument sales, compared to the same periods 
of the prior year.

     Operating expenses increased to $7.8 million and $15.7 million for the 
three and six months ended June 30, 1998, respectively, representing a $1.3 
million and $3.3 million increase over the comparative prior year periods. 
Research and development expenses of $2.9 million and $5.4 million represent 
an increase of $.1 million for both the three and six months ended June 30, 
1998 as compared to the respective prior year periods.  Selling, general and 
administrative expenses increased to $4.9 million and $10.3 million for the 
three and six months ended June 30, 1998, respectively, representing an 
increase of $1.1 million and $3.2 million as compared to the respective prior 
year periods.  These overall increases were primarily driven by the expansion 
of sales and marketing effort as well as an increase in other expenses 
incurred to manage the overall Company growth and expansion of operations.

     Interest income increased to $.4 million and $.6 million for the three 
and six months ended June 30, 1998, respectively, representing a $.4 million 
and $.6 million increase over the comparative prior year periods as a result 
of the investment of the proceeds from the Offering.  For the three months 
ended June 30, 1998, interest expense decreased slightly as compared to the 
prior year as the Company no longer carries a balance owed to Amoco as it did 
in 1997 when it was a wholly owned subsidiary.  For the six months ended June 
30, 1998, interest expense increased slightly as compared to the first half 
of 1997 due to the higher weighted average balance of the note payable-Amoco 
through the Offering date in comparison to the six months ended June 30, 1997.

     The Company's results of operations have been included in the 
consolidated income tax returns of Amoco from inception through February 10, 
1998.  Accordingly, the Company's domestic net operating losses through this 
date have been utilized by Amoco and are not available to offset the 
Company's future taxable income.  As a result of the Offering, the Company 
will no longer be included in the Amoco consolidated federal income tax 
return.  Accordingly, net operating losses incurred from February 10, 1998 
can be carried forward by the Company to offset future taxable income.  A 
full valuation allowance has been provided for all net deferred tax assets at 
June 30, 1998 as management does not consider realization of such amounts 
more likely than not.

LIQUIDITY AND CAPITAL RESOURCES OF THE COMPANY

     Net cash used in operating activities was $8.3 million for the six 
months ended June 30, 1998, an increase of $1.2 million over the same period 
in 1997 driven primarily by an increase in working capital requirements.  Net 
loss was $7.6 million for each of the respective six month periods ended June 
30, 1998 and 1997.  Depreciation and amortization decreased $0.3 million in 
the first half of 1998 primarily as a result of two significant licenses that 
became fully amortized during 1997.  Primary working capital (accounts 
receivable and inventory, less payables) requirements increased in 1998 to 
$2.1 


                                      11
<PAGE>

                                  VYSIS, INC.

              MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL 
               CONDITION AND RESULTS OF OPERATIONS--(CONTINUED)

million from $0.8 million in 1997.  This principally resulted from the 
additional accounts receivable due to the increase in total revenues.  In 
addition, operating cash flow requirements increased as a result of a $.2 
million increase in other assets during 1998 as compared to 1997.

     Net cash flows used in investing activities increased to $13.9 million 
for the first half of 1998 from $0.5 million in the prior year.  This 
increase resulted primarily from the purchase of short-term investments 
subsequent to the receipt of the proceeds from the Offering.

     Net cash flows provided by financing activities for the first six months 
of 1998 were $32.0 million compared to $7.8 million in the same period of 
1997. The $24.2 million increase resulted from the receipt of $32.1 million 
in proceeds from the Offering, partially offset by the reduced borrowings 
from Amoco.  Such borrowings ceased February 10, 1998 upon the completion of 
the Offering, at which time the remaining $2.0 million note balance with Amoco 
was repaid.

     The Company believes that the net proceeds from the Offering, and the 
interest to be earned thereon, will be sufficient to fund the Company's 
operations well into 1999.  The Company's estimate of the time period for 
which cash funds will be adequate to fund its operations is a forward looking 
estimate subject to risks and uncertainty, and actual results may differ 
materially.  The Company's requirements for additional capital will depend on 
many factors, including payments received under existing and potential 
collaborative agreements; the availability of government research grant 
payments; the progress of the Company's collaborative and independent 
research and development projects; the costs of preclinical and clinical 
trials for the Company's products; the prosecutions, defense and enforcement 
of patent claims and other intellectual property rights; and the development 
of manufacturing, sales and marketing capabilities.  To the extent capital 
resources, including payments from existing and possible future collaborative 
agreements and grants, together with the net proceeds from the Offering, are 
insufficient to meet future capital requirements, the Company will have to 
raise additional funds to continue the development of its technologies.  
There can be no assurance that such funds will be available on favorable 
terms, or at all.  To the extent that additional capital is raised through 
the sale of equity or convertible debt securities, the issuance of such 
securities could result in dilution to the Company's shareholders.  If 
adequate funds are not available, the Company may be required to curtail 
operations significantly or to obtain funds through entering into 
collaborative agreements on unattractive terms.  The Company's inability to 
raise capital as and when needed would have a material adverse effect on the 
Company's business, financial condition and the results of operations.


                                      12
<PAGE>

                                  VYSIS, INC.

                           PART II.  OTHER INFORMATION

                            ITEM 1.  LEGAL PROCEEDINGS

     Reference is made to Item 3. Legal Proceedings in the Company's Annual 
Report on Form 10-K for the fiscal year ended December 31, 1997 for 
discussion of litigation matters relating to the Company.  The Company holds 
contingent rights from the Center for Neurologic Study ("CNS") to a license 
under U.S. Patent Nos. 4,851,330 and 5,288,611 (the "Kohne Patents") assigned 
to Gen-Probe, Inc. ("Gen-Probe").  CNS has sued Gen-Probe in California state 
court challenging Gen-Probe's title to the Kohne Patents.  The Company 
reimburses CNS' legal expenses from this litigation.  A California state 
court jury rendered a verdict in December 1997 that certain of CNS' claims of 
title to the Kohne Patents were barred as untimely raised.  Although the 
California state court has not yet entered the jury verdict as a final 
judgment, the Company understands that the court dismissed all remaining 
claims on July 21, 1998.  The Company understands that CNS is evaluating its 
options, including an appeal.  There can be no assurances the Company will 
acquire rights in the Kohne Patents.

On April 9, 1998, the Company entered into a definitive agreement with Oncor, 
Inc. ("Oncor"), ending a patent infringement suit brought by the Company, as 
exclusive licensee, and the Regents of the University of California (the 
"University").  The suit asserted that Oncor had infringed U.S. Patent 
5,447,841 (the "'841 Patent"), covering methods of Fluorescence in situ 
Hybridization ("FISH") using gene-specific DNA probes together with blocking 
DNA.  Under the agreement, the Company received Oncor's non-oncology FISH 
genetic probe business, including existing inventory and associated 
intellectual property. Further, as part of the settlement, the Company 
granted Oncor a non-exclusive, worldwide royalty-bearing license in the field 
of oncology under the '841 Patent and other patents and applications for the 
sale by Oncor of its oncology FISH-based products.  The Company and the 
University shared equally a $500,000 license fee received pursuant to the 
settlement and will share equally an additional $1.5 million license fee due 
on April 9, 2000 to maintain this license in force.

     ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS

     In connection with the Offering (see Note 1 of the Notes to Consolidated 
Financial Statements for further discussion), the Company received net 
proceeds of $32.1 million from the sale of 3,000,000 shares of its Common 
Stock.  From the closing date of the Offering, February 10, 1998 to June 30, 
1998, the Company used such net offering proceeds as follows (in millions):


                                      13
<PAGE>

                                  VYSIS, INC.

                     PART II.  OTHER INFORMATION--(CONTINUED)

<TABLE>
<S>                                                                   <C>
     Purchase of short-term investments and cash equivalents .....    $23.8
     Repayment of note payable-Amoco .............................      2.0
     Acceleration of product development, expansion of sales and
       marketing capabilities and funding of increased working
       capital requirements and ongoing operations ...............      6.3
                                                                      -----
     Total .......................................................    $32.1
                                                                      -----
                                                                      -----
</TABLE>

     Each of these amounts is a reasonable estimate of the application of the 
net offering proceeds.  This use of proceeds does not represent a material 
change in the use of proceeds described in the Prospectus for the Offering. 
Other than the repayment of a note payable to Amoco in the amount of $2.0 
million, none of such amounts (with the exception of salaries and directors' 
fees and working capital advances to subsidiaries incurred in the ordinary 
course of business) represented direct or indirect payments to (i) directors 
or officers of the Company or their associates, (ii) persons owning 10% or 
more of any class of equity securities of the Company or (iii) affiliates of 
the Company.

                ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

EXHIBITS

     Exhibit 27, Financial Data Schedule (included only in the electronic 
filing of this document).

REPORTS ON FORM 8-K

     The registrant did not file any reports on Form 8-K during the quarter.


                                      14
<PAGE>

                                   SIGNATURE

     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.


                                       VYSIS, INC.


Date:  August 12, 1998                 By:   /s/ JAMES J. HABSCHMIDT
                                           -----------------------------
                                            Name:  James J. Habschmidt
                                            TITLE: EXECUTIVE VICE PRESIDENT AND 
                                                   CHIEF FINANCIAL OFFICER


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