1076481--3/30/2007--SEQUENOM

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We may need additional capital to support our growth, which will result in additional dilution to our stockholders. If the investors in our private placement sell their shares which have been registered under the Securities Act, the market price of our common stock may decline significantly. We have a history of operating losses, anticipate future losses and may never become profitable. Our operating results may fluctuate significantly. We have a history of generating a large percentage of our revenue at the end of each quarterly accounting period. A reduction in revenues from sales of MassARRAY products would harm our business. Our revenues are subject to the risks faced by biotechnology and diagnostic companies, pharmaceutical companies, and governmental and other research institutions. We depend on sales of our consumable chips and other MassARRAY consumables for a significant portion of our revenues. We may not be able to generate any revenue from non-invasive prenatal research-use only or diagnostic tests, or any other tests we may develop. If our customers are unable to adequately prepare samples for our MassARRAY system, the overall market demand for our products may decline. The sales cycles for our products are lengthy, and we may expend substantial funds and management effort with no assurance of successfully selling our products or services. We may not be able to successfully adapt our products for commercial applications. We have limited commercial production capability and experience and may encounter production problems or delays, which could result in lower revenue. We depend on third-party products and services and limited sources of supply to develop and manufacture our products. We and our licensees and collaborators may not be successful in developing or commercializing diagnostic products, including non-invasive prenatal diagnostic products, or other products using our products, services, or discoveries. We may not successfully obtain regulatory approval of any non-invasive prenatal or other diagnostic product or other product which we or our licensing or collaborative partners develop and we may not be able to successfully partner with CLIA licensed laboratories with respect to research-use-only products. If the validity of the consents from volunteers were to be challenged, we could be forced to stop using some of our resources, which would hinder our gene discovery outlicensing efforts and our diagnostic product development efforts. If we cannot obtain licenses to patented SNPs and genes, we could be prevented from obtaining significant revenue or becoming profitable. If the medical relevance of SNPs is not demonstrated or is not recognized by others, we may have less demand for our products and services and may have less opportunity to enter into diagnostic product development and commercialization collaborations with others. We may not be able to form and maintain the collaborative relationships or the rights to third-party intellectual property and technologies that our business strategy requires and such relationships may lead to disputes over technology rights or product revenue, royalties, or other payments. Because we exclusively licensed our non-invasive prenatal diagnostic and gender determination testing rights from Isis Innovation Ltd. any dispute with Isis may adversely affect our ability to develop and commercialize diagnostic tests based on these licensed rights. If we do not succeed in obtaining development and marketing rights for products developed in collaboration with others, our revenue and profitability could be reduced. Ethical, privacy, or other concerns about the use of genetic information could reduce demand for our products and services. If we breach any of the terms of our license or supply agreements, or these agreements are otherwise terminated or modified, the termination or modification of such agreements could result in our loss of access to critical components and could delay or suspend our commercialization efforts. We may not successfully integrate acquired businesses. We may not be able to successfully compete in the biotechnology industry. We may potentially compete with our customers, which may adversely affect our business. Our ability to compete in the market may decline if we lose some of our intellectual property rights. Our success will depend partly on our ability to operate without infringing on or misappropriating the proprietary rights of others. The rights we rely upon to protect the intellectual property underlying our products may not be adequate, which could enable others to use our technology and reduce our ability to compete with them. If we cannot attract and retain highly-skilled personnel, our growth might not proceed as rapidly as we intend. If we do not effectively manage our business as it evolves, it could affect our ability to pursue opportunities and expand our business. We are subject to risks associated with our foreign operations. If our production and laboratory facilities are damaged, our business would be seriously harmed. Responding to claims relating to improper handling, storage or disposal of hazardous chemicals, and radioactive and biological materials which we use could be time consuming and costly. We may not have adequate insurance if we become subject to product liability or other claims. Our stock price has been and may continue to be volatile, and your investment could suffer a decline in value.

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1076481--3/30/2007--SEQUENOM_INC