MDS Inc. Completes Divestiture of MDS Pharma Services Phase II-IV Operations

MDS Pharma Services to Focus on the Delivery of Early Stage Services -
    Discovery Through Phase IIaTORONTO, July 1 /CNW/ - MDS Inc. (TSX: MDS; NYSE: MDZ), a leading
provider of products and services to the global life sciences markets, today
announced that it has completed the divestiture of its Phase II-IV operations
to INC Research,(R) Inc.
    Under the terms of the agreement, INC Research, a leading global provider
of contract research organization services headquartered in Raleigh, North
Carolina, has acquired MDS Pharma Services Phase II-IV operations, which
includes approximately 800 employees who conduct large, multi-site clinical
trials in more than 25 countries.
    "The completion of this transaction supports our efforts to advance MDS
Pharma Services' top-three leadership position in the delivery of Early Stage
services," said Stephen P. DeFalco, President and Chief Executive Officer of
MDS Inc.
    MDS expects to provide additional detail with respect to the divestiture
of its Phase II-IV operations when the Company reports financial results for
its fiscal third quarter (three months ending July 31, 2009).
    The Company's decision to sell its MDS Pharma Services Late Stage
operations, which are comprised of Phase II-IV operations and Central Labs,
are a result of MDS's ongoing strategic review process.
    A suitable buyer is being sought for Central Labs, which conducts
analysis of clinical-trial samples to monitor safety and to test for
physiological impact. Central Labs has more than 600 employees at six sites in
Europe, North America and Asia.

    MDS Pharma Services' New Strategic Focus

    Additional background materials pertaining to the new strategic focus for
MDS Pharma Services can be found on MDS Inc.'s Website at
www.mdsinc.com/for_media/electronic_media_kit.asp

    About INC Research,(R) Inc.

    INC Research is a therapeutically focused contract research organization
with a high performance reputation for conducting global clinical development
programs of the highest integrity. Pharmaceutical and biotechnology companies
look to INC Research for a complete range of customized Phase I through Phase
IV programs in therapeutic areas of specialty, and in innovative pediatric and
women's health trials. The company's The Trusted Process(R) methodology and
therapeutic foresight leads customers to more confident, better-informed drug
and device development decisions. INC Research is headquartered in Raleigh,
North Carolina. For more information please visit www.incresearch.com.

    About MDS

    MDS Inc. (TSX: MDS; NYSE: MDZ) is a global life sciences company that
provides market-leading products and services that our customers need for the
development of drugs and diagnosis and treatment of disease. We are a leading
global provider of pharmaceutical contract research, medical isotopes for
molecular imaging, radiotherapeutics, and analytical instruments. MDS has more
than 4,200 highly skilled people in 13 countries. Find out more at
www.mdsinc.com or by calling 1-888-MDS-7222, 24 hours a day.

For further information: MEDIA: Janet Ko, [phone],
[e-mail]; INVESTORS: Kim Lee, [phone], [e-mail]