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UPDATE: Ciphergen Reports Strong Earnings Growth for Second Straight Quarter

NEW YORK, July 26 – Ciphergen Biosystems reported its second straight quarter of greater than 70 percent revenue growth compared to the same periods in 2000, the company said Thursday.  

Higher sales of ProteinChip systems and arrays, as well as revenue from contract research performed at its Biomarker Discovery Centers in California and Pennsylvania contributed to the revenue increase, the company said. In the second quarter of 2001 revenues jumped 71 percent to $3.7 million, up from $2.1 million in the comparable period last year. In the first quarter of the year, revenues increased by 80 percent from the same period in 2000. 

Ciphergen chief financial officer Matt Hogan said he expected the company’s growth trend to continue. ProteinChip customers consist of about equal sets of academic research labs and hospitals, and commercial biotechnology and pharmaceutical companies, he said. But revenue is sharply tilted in favor of ProteinChip sales, he added, with the Biomarker Discovery Centers making only a minor contribution to the company’s revenues during the quarter. 

The Fremont, Calif.-based company’s operating expenses also rose during the second quarter compared to the same period in 2000, from $8.1 million to $9.6 million, primarily because of higher research and development, and general and administrative expenses. 

Ciphergen's protein biochips contain six to eight surfaces treated with various affinity agents for capturing certain classes of proteins. The ProteinChip system allows researchers to automatically analyze the biochips using Surface Enhanced Laser Enhanced Desorption Ionization, a technique for ionizing the proteins and identifying them in a mass spectrometer. 

Hogan said the company is developing additional surface chemistries for its chips, as well as enhanced software systems to accompany the ProteinChip platform.

Ciphergen sold over 20 ProteinChip systems during the second quarter, the first time the company had passed the milestone during one quarter, CEO William Rich said in a statement. Demand was “particularly strong in the clinical proteomics market where biologists and physicians are involved in protein biomarker discovery,” he said. During the quarter, the company also sold its first ProteinChip tandem mass spectrometry interface, a system for linking Ciphergen’s protein affinity chips to mass spectrometers built by Applied Biosystems, to an undisclosed customer. 

The company also acquired BioSepra’s chromatography business in late June, for $12 million in cash. 

As of June 30, Ciphergen had $97.3 million in cash, compared to $103.2 million at the end of the first quarter 2001