CIPH Ciphergen Biosystems (MM)

- Definitive Agreement Signed for Bio-Rad Laboratories to Acquire Instrument Business - FREMONT, Calif., Aug. 14 /PRNewswire-FirstCall/ -- Ciphergen Biosystems, Inc. (NASDAQ:CIPH) today announced financial results for the second quarter ended June 30, 2006. In a separate press release, Ciphergen also announced that it has signed a definitive agreement for Bio-Rad Laboratories to acquire Ciphergen's proprietary proteomics instrument business which includes Ciphergen's Surface Enhanced Laser Desorption/Ionization (SELDI) technology, ProteinChip(R) Arrays and accompanying software. Bio-Rad will purchase this business for approximately $20 million in cash. In addition, Bio-Rad is making a $3 million equity investment in Ciphergen. "Today we announced a significant strategic milestone that accelerates our transformation into a leading specialized diagnostics provider," stated Gail S. Page, President and CEO of Ciphergen. "We have a dedicated management team and the financial resources to build an exciting, attractive diagnostics business for long-term growth and sustained shareholder value." Second Quarter and Six-Month 2006 Financial Results The Company reported net revenue of $5.3 million in the second quarter of 2006, compared to $6.9 million in the second quarter of 2005. On a generally accepted accounting principles (GAAP) basis, net loss declined 18 percent to $7.7 million in the second quarter of 2006, compared to $9.4 million in the second quarter of 2005. Excluding the impact of FAS 123(R) which was adopted by Ciphergen on January 1, 2006, Ciphergen's non-GAAP net loss declined 23 percent to $7.3 million in the second quarter of 2006. Revenue for the first half of 2006 was $12.3 million compared to $13.6 million in the first half of 2005. For the six months ended June 30, 2006, on a GAAP basis the net loss was $13.2 million, compared to $18.7 million in the same period in 2005. The net loss on a non-GAAP basis for the first half of 2006 was $12.3 million. At June 30, 2006, the Company's cash and investments were $20.6 million, compared to $24.4 million at March 30, 2006. Recent Highlights "In the second quarter, we obtained favorable clinical results supporting our ovarian and prostate cancer diagnostics programs, and presented favorable study results at the ASCO and AUA annual meetings. We also recruited and established a Scientific Advisory Board to help direct and prioritize our other programs for further development and commercialization," continued Ms. Page. Definitive Agreement with Bio-Rad Laboratories to Purchase Ciphergen's Instrument Business. -- Bio-Rad will manufacture, sell and market the SELDI technology to the life sciences marketplace for proteomics applications, such as biomarker discovery, characterization and validation. Ciphergen will retain exclusive rights to the diagnostics market. In addition, Ciphergen will have a supply agreement with Bio-Rad to purchase SELDI instruments and consumables for the continued development of its diagnostics business. The companies will collaborate to identify SELDI customers interested in partnering with Ciphergen to commercialize biomarker discoveries. Ovarian Cancer Diagnostic Progress. -- At the 2006 Annual Meeting of the American Society of Clinical Oncology (ASCO) held in early June, Ciphergen announced results of the first ever large-scale multi-institutional independent validation study of biomarkers discovered through current clinical proteomics efforts. As in previous studies, an index derived from the seven markers tested demonstrated improved specificity for discriminating ovarian cancer from benign pelvic masses, as well as for the detection of early stage cancer. -- The biomarkers demonstrated statistically significant power to differentiate ovarian cancer patients from women with benign disease (p