From the birth of genetics in the 19th Century until the 1970s, scientists developed an increasing appreciation that there were relationships between a person’s genetic makeup and that person’s propensity for certain diseases. By the mid-20th Century, scientists began to understand the molecular basis of genetic variation, and it had become clear that genetic differences were caused by variations in a master molecule called DNA. For example, it was recognized in 1959 that Down’s Syndrome resulted when a patient had three copies of chromosome 21 instead of the normal two copies.

Until the late 1970s, scientists studied variant genes and the diseases that resulted from them by studying individual genes. During this period, it might take years for a scientist to even find which gene caused a particular inherited disease, or years to elucidate the structure of nucleotides that made up that single variant gene. Gradually, it became obvious that many disorders are caused by the coordinated activity of many genes or genetic events occurring throughout the genome, leading scientists to begin to study genetic variation on a genome-wide basis instead of a gene-by-gene basis.

In the 1980s, the industry began to develop systems and tools that greatly sped up the process of studying genetic variation. Eventually, the combination of emerging tools and the desire to study variation on a genome-wide basis culminated in the first large-scale U.S. government-subsidized effort called the Human Genome Project. The Human Genome Project was a 13-year, $3 billion effort that culminated in 2001 with publication of the draft consensus sequence of the three billion nucleotides that make up the human genome.

As of February 2007, the Company’s product portfolio included more than 3,700 different microarray designs addressing a growing family of applications such as CGH, CNP, ChIP-chip, DNA methylation, among others. In addition, the Company frequently produces microarrays based on prototypes for new applications, and also produces custom designs for customers who desire them for non-standard applications.

The Company sells a variety of microarray-related products and plan to expand its offering to include a broad range of equipment, reagents and consumables used by its customers to process its microarrays. Such products will include hybridization stations, automated wash stations, scanning systems, and other equipment that the Company will sell on an OEM basis under the NimbleGen brand.

The Company provides analytical services using its microarrays for applications including CGH, CNP, ChIP-chip, DNA methylation, among others. The Company has built one of the largest microarray analysis laboratories in the world in Iceland.

Cost of revenue was $7.8 million for the year ended December 31, 2006 and $7.2 million for the year ended December 31, 2005.

Research and development expenses were $2.6 million for the year ended December 31, 2006 and $1.9 million for the year ended December 31, 2005, an increase of 38%.

Interest income was $419,000 for the year ended December 31, 2006 and $125,000 for the year ended December 31, 2005, an increase of 235%.