The worldwide demand for genomic analysis instruments and supplies was approximately $4.9 billion in 2005, according to SDI. Of this total, SDI estimated that 56%, or about $2.7 billion, was spent on gene expression analysis, and 20%, or about $1.0 billion, was spent on genotyping. In a 2006 report, SDI projected that the markets for gene expression analysis and genotyping would grow approximately 8% per year from 2005 to 2010.

The genomic analysis market spans several industries, including human healthcare, agriculture, animal healthcare and environmental testing.

Common technologies for genomic analysis include DNA sequencing, DNA arrays and PCR. DNA sequencing generally uses a series of biochemical reactions to read the sequence of a DNA molecule by using one of its strands as a template to synthesize a new complementary strand and detecting the series of nucleotide bases that make up the new strand.

Although continuously improving, DNA sequencing technologies have historically been too expensive and too slow for the analysis of large numbers of genes across large numbers of samples.

The Company currently sells three OpenArray instruments: the AutoLoader instrument; the NT Cycler; and the NT Imager.

The Company designed the OpenArray SNP genotyping plate for acquisition of high quality data with the TaqMan PCR assay from hundreds to thousands of samples in a workflow that is simple and readily adapted to a standard laboratory. On a single OpenArray plate, researchers have the flexibility to genotype up to 144 samples against 16 SNPs down to one sample against 3,072 SNPs. The OpenArray system’s simple workflow increases lab productivity and is readily scalable for genotyping more samples without resorting to expensive robotics.

The Company’s OpenArray gene expression analysis or Real-Time qPCR plate uses quantitative real-time SYBR Green PCR to determine the exact number of messenger RNA or DNA copies in a sample, across a wide range of concentrations and with the high sensitivity and specificity needed for complex biological studies.

The Company’s target sequence detection product is identical to its SNP genotyping product in workflow, except it allows sequence-specific detection with endpoint TaqMan or SYBR Green PCR from hundreds to thousands of samples in a system that is simple to use and readily adapted to a standard laboratory. One of the primary applications of this product is for pathogen detection and identification, and with the SYBR Green PCR chemistry, customers can confirm amplification of the specific targeted sequence using a technique called thermal dissociation analysis.

To date, the Company has offered RapidFire to customers primarily as a service. For its service customers, the Company provides both assay development and screening.

Service revenue decreased $0.4 million, or 23%, in 2007 as compared to 2006.

Cost of product revenue increased $2.5 million, or 106%, in 2007 as compared to 2006.

Cost of service revenue increased $0.2 million, or 35%, in 2007 as compared to 2006.

Research and development expenses increased $0.1 million, or 2%, in 2007 as compared to 2006.

Selling and marketing expenses increased $0.9 million, or 40%, in 2007 as compared to 2006.