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Nanogen Posts Q4 Revenues in Line with Lowered Expectations, Plans to Launch New Products

NEW YORK, Jan 31 – Nanogen said Wednesday its fourth quarter revenues rose to $3.0, compared with $2.0 million in the year ago quarter as revenues from sponsored research programs and corporate alliances increased and the company recognized revenue from the sale of its flagship product, the NanoChip Molecular Biology Workstation.

Revenue for the full-year increased to $11.2 million, compared with $8.1 million in 1999. Fourth-quarter and full-year 2000 revenue figures were in line with analysts’ expectations, which had, however, been cut earlier this month.

Nanogen said that to date it had placed a total of 23 Nanochip SNP detection workstations at universities, companies, and public research institutes in the US, Europe, and Japan. Of these, seven were “title transfer transactions,” which give the company the right to record full instrument revenues. The remaining placements were posted as “non-title transfer transactions,” allowing the company to post only a portion of the sale price as revenue. The Nanochip workstation sells for a list price of $150,000 in the US and $175,000 overseas.  

In a conference call to discuss earnings, the company announced that it would launch a number of new products throughout 2001. Nanogen said it would begin beta-testing a gene expression tool in the first quarter of this year and launch the product sometime in the following quarter. The San Diego-based company will also begin beta-testing later this year a DNA amplification tool, which will anchor primers directly on the microchip.

At the end of the third quarter, Nanogen also expects to announce a joint venture for an undisclosed microelectric technology that will separate “electronics from the consumables,” Kieran Gallahue, president of Nanogen, said, declining to give further details. The company expects to begin beta-testing this product by the end of the year.

Operating expenses rose to $7.4 million in the fourth quarter, compared with $7.1 million in the year ago period. For the year, total expenses rose slightly to $34.8 million, compared with $34.4 million in 1999.

Nanogen said that its loss for operations rose slightly in the fourth quarter to $7.4 million, compared with $7.1 million a year ago. For the full year, net losses dropped to $23.5 million, compared with $26.3 million in 1999.

Fourth-quarter net losses narrowed to $5.9 million, or 29 cents a share, compared with $6.6 million, or 36 cents a share, a year ago. For 2000 net losses narrowed to $18.3 million, ir 92 cents a share, compared with $25.2 million, or $1.39 a share, in 1999.

Nanogen said that it expects to post revenues of $18 million - $21 million in 2001, of which $9 million is expected to come from partnerships and $9 million - $12 million is expected to come from product sales.

Nanogen expects to post a net loss of $27 million - $30 million for 2001, or $1.30 - $1.40 on a per share basis, as the company continues to make “significant” R&D investments and step up the hiring of marketing and field-based support staff.
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