The in vitro diagnostics, or IVD, industry focuses on developing products used to evaluate and analyze biological specimens derived from bodily fluids, such as blood, plasma, urine, cells and other substances taken from patients. The information generated may be used to diagnose disease, monitor and guide therapy, assist in managing chronic disease and assess patient status during admission and discharge.

Over the last decade, the clinically routine testing segment of the global IVD market has matured and experienced only modest growth, with a CAGR of 5% to 6%, reaching an estimated $22.9 billion in 2005, according to an article published in August 2006 in Nature Biotechnology. Concurrently, an emerging, high-value segment of the IVD market, known as molecular diagnostics, has captured the attention and research and development efforts of the industry\'s leading companies.

According to the Kalorama report, the molecular diagnostics segment of this market, including a variety of laboratory tests, such as consumer diagnostics (over-the-counter, at-home tests), clinical research, biomarker discovery/testing and novel molecular analyses, was approximately $18 billion in 2006 and is projected to exceed $92 billion in the seven major markets by 2016, a CAGR of 17.7%.

Within this expanding market segment, molecular diagnostics that provide predictive drug response and safety information is expected to increase from 17.5% of the current market potential to approximately 66%, or over $60 billion of the market potential by 2016. As such, it is believed tests that can help physicians make more informed therapeutic decisions for each individual patient will increasingly offer a significant business opportunity.

The Company’s lead molecular diagnostic product candidate is based on a biomarker for congestive heart failure, or CHF, which is a condition in which the heart cannot pump enough blood to the rest of the body. CHF affects an estimated 5 million people in the United States and it is believed a similar number in Europe.

Based on the results of two independent prospective studies, the Company believes that measurements of two proteins found in plasma, called NT-proBNP and galectin-3, have clinical utility as a predictor for survival in both acute and stable CHF. The Company plans to leverage the data from these studies to develop a molecular diagnostic test for the severity and prognosis of patients with CHF by measuring the plasma levels of galectin-3 alone and in combination with NT-proBNP.

The Company’s other lead product candidates are molecular diagnostic tests based on biomarkers that may be used to detect asymptomatic coronary artery stenosis, or narrowing of the arteries leading to the heart, as well as biomarkers in people with atherothrombotic cardiovascular disease, commonly known as vulnerable plaque, that identify patients at the highest risk for heart attack or stroke within two to three years. The Company’s intend to commence a large-scale clinical study in the fourth quarter of 2007 of up to 7,300 participants which may support regulatory filings for its vulnerable plaque product candidate and some of its other cardiovascular product candidates.

In addition to these molecular diagnostic product candidates in development, the Company is also leveraging its technology platform, initiatives and collaborations to discover new biomarkers. Some of its other product candidates that the Company expects to advance rapidly are based on programs it began recently to discover biomarkers for predicting and monitoring the response of cancer patients to treatment with Herceptin (trastuzumab) or Avastin (bevacizumab).

Research and development expenses increased by 62%, or $3.6 million, from the nine months ended September 30, 2006 to the nine months ended September 30, 2007.

Interest income for the nine months ended September 30, 2007 increased by $97,000, to $101,000, from $4,000 in the nine months ended September 30, 2006

Interest expense for the nine months ended September 30, 2007 decreased by 79%, or $406,000, to $105,000 from $511,000 in the

nine months ended September 30, 2006.