##### 





UNITED
    STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C.
    20549
    Form 10-K
  ANNUAL REPORT PURSUANT TO
    SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934
    For the fiscal year ended December 31, 2007
  Commission File Number 0-22962
  HUMAN GENOME SCIENCES,
    INC.
 (Exact name of
    registrant)
  Delaware

22-3178468(State of
    organization)

(I.R.S. employer
    identification number)  14200 Shady Grove Road, Rockville, Maryland 20850-7464 (address of principal
    executive offices and zip code)
  (301) 309-8504
    (Registrants telephone number)
  Securities registered pursuant to Section 12(b) of the
    Act:
  Title of Each Class

Name of Each Exchange on Which RegisteredCommon stock, par value $0.01 per share and
    Preferred Stock Purchase Rights

The NASDAQ Stock Market LLC   Securities registered pursuant to Section 12(g) of the
    Act:
    NONE
  þ o
  o þ
  þ o
  Regulation S-K Form 10-K Form 10-K. o
  Rule 12b-2
  Large accelerated
    filer þ

Accelerated
    filer o

Non-accelerated
    filer o
    (Do not check if a smaller reporting company)

Smaller reporting
    company o   Rule 12b-2 o þ
    DOCUMENTS
    INCORPORATED BY REFERENCE
    *
    Excludes 41,819,771 shares of common stock deemed to be
    held by officers and directors and stockholders whose ownership
    exceeds five percent of the shares outstanding at June 30,
    2007. Exclusion of shares held by any person should not be
    construed to indicate that such person possesses the power,
    direct or indirect, to direct or cause the direction of the
    management or policies of the registrant, or that such person is
    controlled by or under common control with the registrant.




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##### 





PART I
  ITEM 1.
    BUSINESS  This annual report on
    Form 10-K
    contains forward-looking statements, within the meaning of the
    Securities Exchange Act of 1934 and the Securities Act of 1933,
    that involve risks and uncertainties. In some cases,
    forward-looking statements are identified by words such as
    believe, anticipate, expect,
    intend, plan, will,
    may and similar expressions. You should not place
    undue reliance on these forward-looking statements, which speak
    only as of the date of this report. All of these forward-looking
    statements are based on information available to us at this
    time, and we assume no obligation to update any of these
    statements. Actual results could differ from those projected in
    these forward-looking statements as a result of many factors,
    including those identified in the section titled Factors
    That May Affect Our Business, Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations and elsewhere. We urge you to review and
    consider the various disclosures made by us in this report, and
    those detailed from time to time in our filings with the
    Securities and Exchange Commission, that attempt to advise you
    of the risks and factors that may affect our future results.
  Overview
  ® ® tm
            20850-7464. (301) 309-8504. Form 10-K.
  Strategy
   1




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##### 



mid-stage
  
    Accelerate the development and commercialization of our
    late-stage products.  Our priority focus is on
    our product candidates with the highest therapeutic and
    commercial potential, and accelerating the progress of our
    late-stage compounds toward commercialization.  
    Build strong partnerships to bring the strengths of global
    leaders in the pharmaceutical industry to the development and
    commercialization of our products.  The
    co-development and commercialization agreements we have in place
    for our key lead products  Novartis for Albuferon and
    GSK for LymphoStat-B  will help HGS assure that these
    products achieve their full therapeutic and commercial
    potential. As our mid-stage products continue to progress, we
    will consider each individually to assess whether similar
    collaborations are strategically beneficial.  
    Ensure sustainable growth into the future by continuing to
    invest in our mid- and early-stage clinical pipeline.  We have taken actions to strengthen our oncology
    program, including accelerating the mid-stage development of
    HGS-ETR1, our human monoclonal antibody to TRAIL receptor 1. We
    initiated the second randomized trial of HGS-ETR1 in combination
    with chemotherapeutic agents, and acquired the rights to develop
    and commercialize novel small-molecule inhibitors of IAP
    proteins that show substantial early promise in the treatment of
    a number of cancers. We will remain opportunistic in our search
    for new product candidates, assessing the best of the
    therapeutic opportunities discovered by HGS alongside
    therapeutic opportunities discovered by other organizations.
    Pursue strategic acquisitions and
    collaborations.  We will pursue strategic
    acquisitions and collaborations to augment our capabilities,
    provide access to complementary technologies, and expand our
    portfolio of new drug candidates. We also rely on collaborations
    for the development of certain products discovered by HGS or
    others based on our technology, including those to which we have
    substantial financial rights in the GSK clinical pipeline.
    Capitalize on our intellectual property
    portfolio.  We pursue patents to protect our
    intellectual property and have developed a significant
    intellectual property portfolio. As of December 31, 2007,
    we had 593 issued U.S. patents covering genes, proteins,
    antibodies and proprietary technologies, and had filed
    U.S. patent applications covering many additional
    discoveries and inventions. We will seek opportunities to
    monetize intellectual property assets that we do not plan to
    develop ourselves internally.
    Maintain a strong cash position.  Unlike many
    pre-commercial companies, HGS has finances in place that allow
    us to maintain a priority focus on advancing our late-stage
    products to commercialization, while also exploring longer-term
    opportunities that will drive momentum beyond our lead products.
    Controlling net cash burn and maintaining a strong cash position
    will continue to be an important ongoing priority.  Products
    Clinical
    Programs
  Late-Stage
    Products
   2




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##### 



Albuferon
    (albinterferon alfa-2b)
  co-development
    follow-up. follow-up.
        LymphoStat-B
    (belimumab)
  ®
   3




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##### 



ABthrax
    (raxibacumab)
  Bacillus anthracis
        Oncology
    Products
    TRAIL
    Receptor Antibodies
   4




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##### 



HGS-ETR1
  75-80%
  IAP
    Inhibitors
      Products
    in the GSK Pipeline
  ®
  Darapladib
      Syncria
    (albiglutide)
   5




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##### 



GSK649868
    Research
    and Development
    Human
    Antibody Technology
      Albumin-Fusion
    Technology
      Drug
    Development
    
    Clinical Research.  The clinical research group
    is responsible for the design, planning and analysis of clinical
    trials, and matches novel biological molecules emerging from our
    protein and antibody discovery programs to unmet medical needs. 6




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##### 




    Clinical Operations.  The clinical operations
    group executes clinical trials and is responsible for managing
    clinical trial sites and ensuring that all proper procedures are
    followed during the collection of clinical data. The group
    includes our data management team.
    Project Management.  Our project management
    team oversees the process of development of a drug from the
    earliest stages of research through the conduct of clinical
    development and regulatory filings.
    Regulatory Affairs.  The regulatory affairs
    group manages communications with and submissions to regulatory
    authorities.
    Drug Safety.  As our products advance in
    clinical testing, our drug safety group collects and analyzes
    information on drug experience and safety, and ensures that
    accurate medical information is distributed.
    Quality Assurance.  The quality assurance group
    ensures compliance with all regulatory requirements for the
    clinical development and manufacture of new products.
    Bioanalytical Sciences.  The bioanalytical
    sciences group develops and performs highly specialized assays
    that are used during monitoring of preclinical tests and
    clinical trials. Other assays help to ensure the quality and
    consistency of our products.  Strategic
    Collaborations
      Lead
    Commercial Collaborations
  Novartis
  Albuferon.
  GlaxoSmithKline
  LymphoStat-B.
 7




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##### 



TRAIL Receptor Antibodies.
  Darapladib.
  Syncria.
  GSK649868.
  Product
    Collaborations and Agreements
  Aegera Therapeutics.
  CoGenesys.
  Takeda.
  Kirin.
 8




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##### 



diaDexus.
  Amgen.
  Genentech.
  Technology
    Collaborations
  Abgenix.
  Cambridge Antibody Technology (CAT).
   9




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##### 



Patents
    and Proprietary Rights
               10




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##### 



Competition
  General.
  Basis of Competition.
  
    the quality and breadth of an organizations technology;
    the skill of an organizations employees and its ability to
    recruit and retain skilled employees;
    an organizations intellectual property estate;
    the range of capabilities, from target identification and
    validation to drug discovery and development to manufacturing
    and marketing; and  
    the availability of substantial capital resources to fund
    discovery, development and commercialization activities.    Products.
  Government
    Regulation
    Preclinical Testing.
 11




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##### 



Clinical Testing.
  
    Phase 1 clinical trials are conducted with a small number of
    subjects to determine the early safety profile and the pattern
    of drug distribution and metabolism.
    Phase 2 clinical trials are conducted with groups of patients
    afflicted with a specified disease in order to provide enough
    data to evaluate preliminary efficacy and optimal dosages
    statistically and to expand evidence of safety.  
    Phase 3 clinical trials are large-scale, multi-center,
    comparative trials, which are designed to gather additional
    information for proper dosage and labeling of the drug and to
    demonstrate its overall safety and efficacy.    Marketing Approvals.
    Other Regulation.
    Foreign Regulation.
  Possible Pricing Restrictions.
 12




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##### 



Sources
    of Supply
    Manufacturing
          Marketing
    Employees
   13




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##### 



ITEM 1A.
    RISK
    FACTORS  There are a number of risk factors that could cause our
    actual results to differ materially from those that are
    indicated by forward-looking statements. Those factors include,
    without limitation, those listed below and elsewhere herein.
  If we are unable to commercialize products, we may not be
    able to recover our investment in our product development and
    manufacturing efforts.
    Because our product development efforts depend on new and
    rapidly-evolving technologies, we cannot be certain that our
    efforts will be successful.
    
    these technologies or any or all of the products based on these
    technologies will be ineffective or toxic, or otherwise fail to
    receive necessary regulatory clearances;
    the products, even if safe and effective, will be difficult to
    manufacture on a large scale or uneconomical to market;
    proprietary rights of third parties will prevent us or our
    collaborators from exploiting technologies or marketing
    products; and
    third parties will market superior or equivalent products.  Because we are a late-stage development company, we cannot be
    certain that we can develop our business or achieve
    profitability.
    We are continually evaluating our business strategy, and may
    modify this strategy in light of developments in our business
    and other factors.
   14




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##### 



PRODUCT
    DEVELOPMENT RISKS
  Because we have limited experience in developing and
    commercializing products, we may be unsuccessful in our efforts
    to do so.
    
    develop products;
    complete laboratory testing and human studies;
    obtain and maintain necessary intellectual property rights to
    our products;
    obtain and maintain necessary regulatory approvals related to
    the efficacy and safety of our products;
    maintain production facilities meeting all regulatory
    requirements or enter into arrangements with third parties to
    manufacture our products on our behalf; and
    deploy sales and marketing resources effectively or enter into
    arrangements with third parties to provide these functions.    Because clinical trials for our products are expensive and
    protracted and their outcome is uncertain, we must invest
    substantial amounts of time and money that may not yield viable
    products.
     15




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##### 




    our inability to manufacture sufficient quantities of materials
    for use in clinical trials;
    variability in the number and types of patients available for
    each study;
    difficulty in maintaining contact with patients after treatment,
    resulting in incomplete data;
    unforeseen safety issues or side effects;
    poor or unanticipated effectiveness of products during the
    clinical trials; or
    government or regulatory delays.  131 HGS-TR2J.
  and/or
  We face risks in connection with our ABthrax product in
    addition to risks generally associated with drug development.
  in vitro in
    vivo
 16




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##### 



Because neither we nor any of our collaboration partners have
    received marketing approval for any product candidate resulting
    from our research and development efforts, and because we may
    never be able to obtain any such approval, it is possible that
    we may not be able to generate any product revenue.
    RISK FROM
    COLLABORATION RELATIONSHIPS AND STRATEGIC ACQUISITIONS
  Our plan to use collaborations to leverage our capabilities
    and to grow in part through the strategic acquisition of other
    companies and technologies may not be successful if we are
    unable to integrate our partners capabilities or the
    acquired companies with our operations or if our partners
    capabilities do not meet our expectations.
      Although GSK has agreed to be our partner in the development
    and commercialization of HGS-ETR1, we may be unable to negotiate
    an appropriate co-development and co-marketing agreement.
   17




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##### 



Phase 3/4
  Our ability to receive revenues from the assets licensed in
    connection with our CoGenesys transaction will depend on
    CoGenesys ability to develop and commercialize those
    assets.
    Because we depend on our collaboration partners for revenue,
    we may not become profitable if we cannot increase the revenue
    from our collaboration partners or other sources.
        
    develop marketable products;
    obtain regulatory approvals for products; or
    successfully market products.    If one of our collaborators pursues a product that competes
    with our products, there could be a conflict of interest and we
    may not receive milestone or royalty payments.
    Reimbursement payments from our collaborators to fund our
    late-phase clinical trials will pay for approximately half of
    our late-phase clinical trial expenses and our ability to
    develop and commercialize products may be impaired if payments
    from our collaborators are delayed.
   18




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##### 



FINANCIAL
    AND MARKET RISKS
  Because of our substantial indebtedness, we may be unable to
    adjust our strategy to meet changing conditions in the
    future.
    
    payments of interest on, and principal of, our indebtedness will
    be substantial, and may exceed then current income and available
    cash;
    we may be unable to obtain additional future financing for
    continued clinical trials, capital expenditures, acquisitions or
    general corporate purposes;
    we may be unable to withstand changing competitive pressures,
    economic conditions and governmental regulations; and
    we may be unable to make acquisitions or otherwise take
    advantage of significant business opportunities that may arise.  To pursue our current business strategy and continue
    developing our products, we may need additional funding in the
    future. If we do not obtain this funding on acceptable terms, we
    may not be able to continue to grow our business and generate
    enough revenue to recover our investment in our product
    development effort.
      
    the amount of revenue or cost sharing, if any, that we are able
    to obtain from our collaborations, any approved products, and
    the time and costs required to achieve those revenues;
    the ability to deliver and collect on the ABthrax contract with
    the U.S. Government;
    the timing, scope and results of preclinical studies and
    clinical trials;
    the size and complexity of our development programs;
    the time and costs involved in obtaining regulatory approvals;
    the costs of launching our products;
    the costs of commercializing our products, including marketing,
    promotional and sales costs;
    our ability to establish and maintain collaboration partnerships;
    competing technological and market developments;
    the costs involved in filing, prosecuting and enforcing patent
    claims; and 19




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##### 




    scientific progress in our research and development programs.    
    delay, scale back or eliminate some or all of our research and
    development programs;
    delay, scale back or eliminate some or all of our
    commercialization activities;
    lose rights under existing licenses;
    relinquish more of, or all of, our rights to product candidates
    on less favorable terms than we would otherwise seek; and
    be unable to operate as a going concern.  Some of our operating leases contain financial covenants,
    which may require us to accelerate payment under those
    agreements or increase the amount of our security deposits.
    Our insurance policies are expensive and protect us only from
    some business risks, which will leave us exposed to significant,
    uninsured liabilities.
    INTELLECTUAL
    PROPERTY RISKS
  If patent laws or the interpretation of patent laws change,
    our competitors may be able to develop and commercialize our
    discoveries.
   20




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##### 



If our patent applications do not result in issued patents,
    our competitors may obtain rights to and commercialize the
    discoveries we attempted to patent.
    If others file patent applications or obtain patents similar
    to ours, then the Patent and Trademark Office may deny our
    patent applications, or others may restrict the use of our
    discoveries.
    Because issued patents may not fully protect our discoveries,
    our competitors may be able to commercialize products similar to
    those covered by our issued patents.
   21




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##### 



We rely on our collaboration partners to seek patent
    protection for the products they develop based on our
    research.
    If we are unable to protect our trade secrets, others may be
    able to use our secrets to compete more effectively.
    REGULATORY
    RISKS
  Because we are subject to extensive changing government
    regulatory requirements, we may be unable to obtain government
    approval of our products in a timely manner.
    Marketing Approvals.
    Foreign Regulation.
  Because we are subject to environmental, health and safety
    laws, we may be unable to conduct our business in the most
    advantageous manner.
 22




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##### 



OTHER
    RISKS RELATED TO OUR BUSINESS
  Many of our competitors have substantially greater
    capabilities and resources and may be able to develop and
    commercialize products before we do.
      
    the quality and breadth of an organizations technology;
    the skill of an organizations employees and its ability to
    recruit and retain skilled employees;
    an organizations intellectual property portfolio;
    the range of capabilities, from target identification and
    validation to drug discovery and development to manufacturing
    and marketing; and
    the availability of substantial capital resources to fund
    discovery, development and commercialization activities.      If we lose or are unable to attract key management or other
    personnel, we may experience delays in product development.
    If the health care system or reimbursement policies change,
    the prices of our potential products may be lower than expected
    and our potential sales may decline.
   23




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##### 



We may be unable to successfully establish a manufacturing
    capability and may be unable to obtain required quantities of
    our products economically.
      Because we currently have only a limited marketing
    capability, we may be unable to sell any of our products
    effectively.
    Because we depend on third parties to conduct many of our
    human studies, we may encounter delays in or lose some control
    over our efforts to develop products.
    Our certificate of incorporation, bylaws and stockholder
    rights plan could discourage acquisition proposals, delay a
    change in control or prevent transactions that are in your best
    interests.
   24




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##### 




    authorize the issuance of up to 20,000,000 shares of
    blank check preferred stock that could be issued by
    our board of directors to increase the number of outstanding
    shares and discourage a takeover attempt;
    classify the directors of our board with staggered, three-year
    terms, which may lengthen the time required to gain control of
    our board of directors;
    limit who may call special meetings of stockholders; and
    establish advance notice requirements for nomination of
    candidates for election to the board of directors or for
    proposing matters that can be acted upon by stockholders at
    stockholder meetings.  Because our stock price has been and will likely continue to
    be volatile, the market price of our common stock may be lower
    or more volatile than you expected.
    
    future announcements about our company or our competitors,
    including the results of testing, technological innovations or
    new commercial products;
    negative regulatory actions with respect to our potential
    products or regulatory approvals with respect to our
    competitors products;
    changes in government regulations;
    developments in our relationships with our collaboration
    partners;
    developments affecting our collaboration partners;
    announcements relating to health care reform and reimbursement
    levels for new drugs;
    our failure to acquire or maintain proprietary rights to the
    gene sequences we discover or the products we develop;
    litigation; and
    public concern as to the safety of our products.   25




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##### 



ITEM 1B.
    UNRESOLVED
    STAFF COMMENTS    ITEM 2.
    PROPERTIES        ITEM 3.
    LEGAL
    PROCEEDINGS    ITEM 4.
    SUBMISSION
    OF MATTERS TO A VOTE OF SECURITY HOLDERS   26




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##### 



PART II
  ITEM 5.
    MARKET
    FOR REGISTRANTS COMMON EQUITY AND RELATED
    STOCKHOLDERS MATTERS    High


Low2006First Quarter

$
13.80


$
8.46Second Quarter

$
11.90


$
9.80Third Quarter

$
11.97


$
9.40Fourth Quarter

$
13.83


$
11.902007First Quarter

$
12.52


$
10.25Second Quarter

$
11.51


$
8.92Third Quarter

$
10.39


$
7.06Fourth Quarter

$
11.10


$
9.12       Comparison
    of 5 Year Cumulative Total Return
  
 27




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##### 



ITEM 6.
    SELECTED
    CONSOLIDATED FINANCIAL DATA    Years Ended December 31,2007


2006


2005


2004


2003Statement of Operations Data:Revenue  research and development contracts

$
41,851


$
25,755


$
19,113


$
3,831


$
8,168Costs and expenses:Research and
    development(1)


245,745



209,242



228,717



219,549



191,483General and administrative


55,874



53,101



42,066



35,728



43,608Lease termination and restructuring charges (credits)


(3,673
)


29,510







15,408



Total costs and
    expenses(1)


297,946



291,853



270,783



270,685



235,091Income (loss) from
    operations(1)


(256,095
)


(266,098
)


(251,670
)


(266,854
)


(226,923
)Net investment income (expense)


(6,353
)


166



12,133



21,267



40,508Gain on sale of equity investments






14,759



1,302



256



1,091Gain (loss) on extinguishment of debt










(1,204
)


2,433



Income (loss) before taxes


(262,448
)


(251,173
)


(239,439
)


(242,898
)


(185,324
)Provision for income taxes


















Net income
    (loss)(1)

$
(262,448
)

$
(251,173
)

$
(239,439
)

$
(242,898
)

$
(185,324
)Net income (loss) per share, basic and
    diluted(1)

$
(1.95
)

$
(1.91
)

$
(1.83
)

$
(1.87
)

$
(1.44
)Other Data:Ratio of earnings to fixed charges


















Coverage
    deficiency(1)

$
(262,448
)

$
(251,173
)

$
(239,439
)

$
(242,898
)

$
(185,324
)  28




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##### 



ITEM 6.
    SELECTED
    CONSOLIDATED FINANCIAL DATA, CONTINUED  As of December 31,2007


2006


2005


2004


2003(In thousands, except per share and ratio data)Balance Sheet Data:Cash, cash equivalents, short-term investments, marketable
    securities and restricted
    investments(2)


$603,840



$763,084



$646,220



$952,686



$1,262,458Total
    assets(3)


949,105



1,149,668



997,046



1,249,385



1,466,204Total debt and capital lease, less current
    portion(3)


754,099



751,526



510,000



505,131



503,664Accumulated deficit


(1,882,830
)


(1,620,381
)


(1,369,208
)


(1,129,769
)


(886,871
)Total stockholders equity (deficit)


(11,902
)


213,923



416,966



656,047



903,333     (1)
    
    For 2007, amounts include expense associated with license
    agreement with Aegera Therapeutics, Inc. (Aegera) of
    $16,852, or $0.13 per share.(2)
    
    Cash, cash equivalents, short-term investments, marketable
    securities and restricted investments for 2007, 2006,
    2005, 2004 and 2003 includes $70,931, $61,165, $220,171,
    $215,236 and $280,776 respectively, of restricted investments
    relating to certain leases.(3)
    
    Total assets for 2007, 2006, 2005, 2004 and 2003
    includes $70,931, $61,165, $220,171, $215,236 and $280,776
    respectively, of restricted investments relating to certain
    leases. Total debt and capital lease, less current
    portion for 2007, 2006, 2005, 2004 and 2003 does not
    include any operating lease obligations under various facility
    and equipment lease arrangements. See Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations  Liquidity and Capital Resources for
    additional discussion. 29




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##### 



ITEM 7.
    MANAGEMENTS
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
    OPERATIONS  Overview
  ® ® tm
              in vitro in
    vivo
 30




---



##### 



Overview
    (continued)
        Critical
    Accounting Policies and the Use of Estimates
      Investments. Accounting for Certain
    Investments in Debt and Equity Securities
 31




---



##### 



Critical
    Accounting Policies and the Use of Estimates
    (continued)
    Leases. 20-year
  Accounting For Leases:
    Sale-Leaseback Transactions Involving Real Estate
  Impairments of long-lived assets.
  Revenue. Revenue Recognition
    in Financial Statements Revenue Recognition 00-21 (EITF 00-21), Revenue Arrangements with Multiple Deliverables EITF 00-21
 32




---



##### 



Critical
    Accounting Policies and the Use of Estimates
    (continued)
    ®
  Research and Development.
  Stock Compensation.
  Accounting
    for Stock Issued to Employees Accounting
    for Stock-Based Compensation
  Share-Based Payment
   33




---



##### 



Critical
    Accounting Policies and the Use of Estimates
    (continued)
    No. 96-18, Accounting for Equity Instruments that are Issued to Other
    Than Employees for Acquiring, or in Conjunction with Selling,
    Goods, or Services
  Exit Accruals.
  Results
    of Operations
  Years
    Ended December 31, 2007 and 2006
  Revenues.
    Expenses.
       34




---



##### 



Results
    of Operations (continued)
  Years Ended December 31, 2007 and 2006 (continued)
      project-by-project
         35




---



##### 



Results
    of Operations (continued)
  Years Ended December 31, 2007 and 2006 (continued)
    Net Income (Loss).
  Years
    Ended December 31, 2006 and 2005
  Revenues.
    Expenses.
         36




---



##### 



Results
    of Operations (continued)
  Years Ended December 31, 2006 and 2005 (continued)
      project-by-project
           37




---



##### 



Results
    of Operations (continued)
  Years Ended December 31, 2006 and 2005 (continued)
      1 4 3 4
  Net Income (Loss).
    Liquidity
    and Capital Resources
     38




---



##### 



Liquidity
    and Capital Resources (continued)
        Clinical Trial Status as ofDecember
    31,(2)Product
    Candidate(1)

Indication

2007

2006

2005ACTIVE CANDIDATES:Albuferon

Hepatitis C

Phase 3

Phase 3

Phase 2LymphoStat-B

Systemic Lupus Erythematosus

Phase 3

Phase
    2(3)

Phase 2LymphoStat-B

Rheumatoid Arthritis

Phase
    2(4)

Phase
    2(4)

Phase 2HGS-ETR1

Cancer

Phase 2

Phase 2

Phase 2HGS-ETR2

Cancer

Phase 1

Phase 1

Phase 1CCR5 mAb

HIV

(5)

(5)

Phase 1ABthrax

Anthrax

(6)

(6)

(6)HGS1029

Cancer

(7)



INACTIVE CANDIDATES:HGS-TR2J

Cancer

(8)

Phase
    1(8)

Phase 1LymphoRad131

Cancer

(9)

(9)

(9)     (1)
    
    Includes only those candidates for which an Investigational New
    Drug (IND) application has been filed with the FDA.(2)
    
    Clinical Trial Status defined as when patients are being dosed.(3)
    
    Initial Phase 2 trial completed and Phase 3 enrollment initiated
    in 2006; patient dosing began in 2007.(4)
    
    Initial Phase 2 trial completed; extension safety study ongoing.(5)
    
    Initial Phase 1 trial completed, further development under
    review.(6)
    
    U.S. Government executed the second phase of the contract in
    2006, placing an order for 20,001 doses of ABthrax. In addition,
    clinical development and manufacturing activities are in
    progress. As of December 31, 2005, only the first phase of
    the contract (comparative testing) had been executed.(7)
    
    IND filed in December 2007 with respect to HGS1029 (formerly
    AEG40826).(8)
    
    Clinical development suspended in 2006.(9)
    
    Clinical development discontinued in 2005.   39




---



##### 



Liquidity
    and Capital Resources (continued)
               40




---



##### 



Liquidity
    and Capital Resources (continued)
        Payments Due by PeriodOne Year


Two to


Four to


AfterTotal


or Less


Three Years


Five Years


Five Years(dollars in millions)Contractual ObligationsLong-term debt  convertible
    notes(1)

$
561.1


$
11.4


$
23.0


$
526.7


$
Long term lease commitment 
    BioMed(2)


518.7



23.6



48.6



50.5



396.0Operating
    leases(3)


422.5



22.2



44.7



44.4



311.2Unconditional purchase
    obligations(4)


2.8



2.8











Other long-term liabilities reflected on our balance
    sheets(5)


















Total contractual cash
    obligations(6)

$
1,505.1


$
60.0


$
116.3


$
621.6


$
707.2     (1)
    
    Contractual interest obligations related to our convertible
    subordinated notes included above total $51.1 million as of
    December 31, 2007. Contractual interest obligations of
    $11.4 million, $23.0 million and $16.7 million
    are due in one year or less, two to three years and four to five
    years, respectively.(2)
    
    Contractual interest obligations related to BioMed are included
    above and aggregate $465.7 million as of December 31,
    2007. Contractual interest obligations of $23.6 million,
    $48.6 million, $50.5 million and $343.0 million
    are due in one year or less, two to three years, four to five
    years and after five years, respectively.(3)
    
    Includes Traville headquarters operating lease with BioMed with
    aggregate payments of $378.1 million. Lease payments of
    $17.2 million, $35.4 million, $36.8 million, and
    $288.7 million are due in one year or less, two to three
    years, four to five years and after five years, respectively.
    The operating lease obligations shown above are the gross
    amounts, not considering sublease income. Contractual sublease
    income of $4.5 million, $9.2 million and
    $4.3 million is due in one year or less, two to three years
    and four to five years, respectively. Certain of our operating
    leases contain financial covenants with respect to minimum
    levels of unrestricted cash, cash equivalents and marketable
    securities and minimum levels of net worth. During 2007, we
    amended certain of these leases to eliminate the minimum net
    worth covenant and adjust the minimum levels of unrestricted
    cash, cash equivalents and marketable securities required under
    the leases. We also pledged additional collateral of
    approximately $8.6 million to certain lessors to satisfy
    the minimum net worth covenant associated with certain other
    leases.(4)
    
    Our unconditional purchase obligations relate to commitments for
    capital expenditures.(5)
    
    In the event we reach certain development milestones for
    Albuferon, LymphoStat-B and ABthrax, such as successful
    completion of Phase 3 trials or regulatory approval, we would be
    obligated to make payments of up to $13.0 million over the
    next five years, including $1.5 million in 2008. In the
    event we reach certain development milestones related to
    HGS1029, we would be obligated to pay up to $205.0 million,
    including 41




---



##### 



Liquidity
    and Capital Resources (continued)
  $5.0 million in 2008. Our other products are in either
    Phase 1 or Phase 2 and would also obligate us to make certain
    milestone payments should they reach Phase 3 or regulatory
    approval. These other payments could result in aggregate
    milestone payments of $21.0 million. Because we cannot
    forecast with any degree of certainty whether any of our
    products will reach these milestones, we have excluded these
    amounts and any royalty payments from the above table.(6)
    
    For additional discussion of our debt obligations and lease
    commitments, see Note I, Long-Term Debt and Note J,
    Commitments and Other Matters, of the Notes to the Consolidated
    Financial Statements.      Off-Balance
    Sheet Arrangements
       42




---



##### 



Safe
    Harbor Statement under the Private Securities Litigation Reform
    Act of 1995
   43




---



##### 



ITEM 7A.
    QUANTITATIVE
    AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK              ITEM 8.
    FINANCIAL
    STATEMENTS AND SUPPLEMENTARY DATA   44




---



##### 



ITEM 9.
    CHANGES
    AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
    DISCLOSURE    ITEM 9A.
    CONTROLS
    AND PROCEDURES  Disclosure
    Controls and Procedures
  Form 10-K
  Changes
    in Internal Control
    Management
    Report on Internal Control over Financial Reporting
  Rule 13a-15(f) 15d-15(f)
  
    pertain to the management of records that in reasonable detail
    accurately and fairly reflect the transactions and dispositions
    of the assets of the Company;  
    provide reasonable assurance that transactions are recorded as
    necessary to permit preparation of financial statements in
    accordance with generally accepted accounting principles, and
    that receipts and expenditures of the Company are being made
    only in accordance with authorizations of management and
    directors of the Company; and
    provide reasonable assurance regarding prevention or timely
    detection of unauthorized acquisition, use or disposition of the
    Companys assets that could have a material effect on the
    financial statements.     45




---



##### 



ITEM 9A.
    CONTROLS
    AND PROCEDURES (continued)  
 Management
    Report on Internal Control over Financial Reporting
    (continued)
      ITEM 9B.
    OTHER
    INFORMATION   46




---



##### 



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
    ON INTERNAL CONTROL OVER FINANCIAL REPORTING
  
                  47




---



##### 



PART III
  ITEM 10.
    DIRECTORS
    AND EXECUTIVE OFFICERS OF THE REGISTRANT    ITEM 11.
    EXECUTIVE
    COMPENSATION    ITEM 12.
    SECURITY
    OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
    RELATED STOCKHOLDER MATTERS    ITEM 13.
    CERTAIN
    RELATIONSHIPS AND RELATED TRANSACTIONS    ITEM 14.
    PRINCIPAL
    ACCOUNTANT FEES AND SERVICES   48




---



##### 



PART IV
  ITEM 15.
    EXHIBITS AND
    FINANCIAL STATEMENT SCHEDULES      PageNumberReport of Ernst & Young LLP, Independent Registered
    Public Accounting Firm


F-2Consolidated Balance Sheets at December 31, 2007 and 2006


F-3Consolidated Statements of Operations for the years ended
    December 31, 2007, 2006 and 2005


F-4Consolidated Statements of Stockholders Equity for the
    years ended December 31, 2007, 2006 and 2005


F-5Consolidated Statements of Cash Flows for the years ended
    December 31, 2007, 2006 
    and 2005


F-6Notes to Consolidated Financial Statements


F-8   (2)
    Financial Statement Schedules      ExhibitNo.3.1*

Certificate of Incorporation of the Registrant (Filed as
    Exhibit 3.1 to the Registrants
    Form 10-K
    for the fiscal year ended December 31, 1993,
    Exhibit 3.3 to the
    Form 10-K
    for the fiscal year ended December 31, 1997,
    Exhibit 3.1 to the
    Form 8-K
    filed December 16, 1999 and Exhibit 3.1 to the
    Form 10-Q
    filed July 31, 2001).3.2*

By-laws of the Registrant (Filed as Exhibit 3.1 to the
    Registrants
    Form 8-K
    filed October 18, 2006).4.1*

Form of Common Stock Certificate (Filed as Exhibit 4.1 to
    the Registrants
    Form S-3
    Registration Statement, as amended (Commission File
    No. 333-45272),
    filed September 6, 2000).4.2*

Rights Agreement between the Registrant and American Stock
    Transfer & Trust Company, as Rights Agent, dated
    as of May 20, 1998 (Filed as Exhibit 4 to the
    Registrants
    Form 8-K
    filed May 28, 1998).4.3*

Indenture dated as of October 4, 2004 between the
    Registrant and The Bank of New York, as trustee, including the
    form of
    21/4% Convertible
    Subordinated Notes due 2011 (Filed as Exhibit 4.1 to the
    Registrants
    Form 8-K
    filed October 4, 2004).4.4*

Indenture dated as of August 9, 2005 between the Registrant
    and The Bank of New York, as trustee, including the form of
    21/4% Convertible
    Subordinated Notes due 2012 (Filed as Exhibit 4.1 to the
    Registrants
    8-K filed
    August 9, 2005).4.5*

Registration Rights Agreement dated as of August 9, 2005 by
    and among the Registrant and the Initial Purchasers named
    therein (Filed as Exhibit 4.2 to the Registrants
    Form 8-K
    filed August 9, 2005).10.1*

Employment Agreement, dated November 21, 2004, with H.
    Thomas Watkins (Filed as Exhibit 10.1 to the
    Registrants
    Form 8-K
    filed November 23, 2004).10.2*

First Amendment to the Employment Agreement by and between Human
    Genome Sciences, Inc. and H. Thomas Watkins (Filed as
    Exhibit 10.1 to the Registrants
    Form 8-K
    filed December 20, 2007).10.3*

Form of Executive Agreement (Filed as Exhibit 10.3 to the
    Registrants
    Form 8-K
    filed December 20, 2007).10.5*

Human Genome Sciences, Inc. Discretionary Bonus Policy (Filed as
    Exhibit 10.4 to the Registrants
    Form 8-K
    filed December 20, 2007).10.6*

Form of Stock Unit Grant Agreement under the Non-Employee
    Director Equity Compensation Plan (Filed as Exhibit 10.5 to
    the Registrants
    Form 8-K
    filed December 20, 2007). 49




---



##### 



ExhibitNo.10.7*

2000 Stock Incentive Plan, as amended (Filed as Exhibit A
    to the Registrants Definitive Proxy Statement on
    Schedule 14A filed April 18, 2001 and Annexes A
    and B to the Registrants Definitive Proxy Statement on
    Schedule 14A filed April 16, 2004).10.8*

Amended and Restated 2000 Employee Stock Purchase Plan dated
    May 2, 2007 (Filed as Annex A to the Registrants
    Definitive Proxy Statement on Schedule 14A filed
    March 21, 2007).10.9*

Lease Agreement between Maryland Economic Development
    Corporation and Human Genome Sciences, Inc., dated
    December 1, 1997 (Filed as Exhibit 10.67 to the
    Registrants
    Form 10-K
    for the fiscal year ended December 31, 1997).10.10*

Lease Agreement between Maryland Economic Development
    Corporation and Human Genome Sciences, Inc. dated
    December 1, 1999 (Filed as Exhibit 10.43 to the
    Registrants
    Form 10-K
    for the fiscal year ended December 31, 1999).10.11*

Omnibus Agreement between Maryland Economic Development
    Corporation, Wells Fargo Bank Northwest, National Association,
    Human Genome Sciences, Inc., Allfirst Bank, a division of
    M&T Bank and the other parties named therein dated
    June 26, 2003 (Filed as Exhibit 10.1 to the
    Registrants
    Form 10-Q
    filed August 11, 2003).10.12*

Lease Agreement between Wells Fargo Bank Northwest, National
    Association as Trustee under Trust Agreement and Human
    Genome Sciences, Inc. dated October 25, 2001 (Filed as
    Exhibit 10.22 to the Registrants
    Form 10-K
    for the fiscal year ended December 31, 2001 and amended by
    Exhibit 10.15 hereto).10.13*

Cash Collateral Pledge Agreement between Human Genome Sciences,
    Inc., Allfirst Bank and Allfirst Trust Company National
    Association dated October 25, 2001 (Filed as
    Exhibit 10.23 to the Registrants
    Form 10-K
    for the fiscal year ended December 31, 2001).10.14*

Guarantee by Human Genome Sciences, Inc. as Guarantor in favor
    of Allfirst Bank, as Agent dated October 25, 2001 (Filed as
    Exhibit 10.24 to the Registrants
    Form 10-K
    for the fiscal year ended December 31, 2001 and amended by
    Exhibit 10.15 hereto).10.15*

Amendment No. 1 dated March 29, 2002 to Lease
    Agreement between Wells Fargo Bank Northwest, National
    Association as Trustee under Trust Agreement and Human
    Genome Sciences, Inc. dated October 25, 2001 (Filed as
    Exhibit 10.25 to the Registrants
    Form 10-K
    for the fiscal year ended December 31, 2001).10.16*

Amendment No. 1 dated March 29, 2002 to Guarantee by
    Human Genome Sciences, Inc. as Guarantor in favor of Allfirst
    Bank, as Agent dated October 25, 2001 (Filed as
    Exhibit 10.26 to the Registrants
    Form 10-K
    for the fiscal year ended December 31, 2001).10.17*

Form of Restricted Stock Agreement (Filed as Exhibit 10.20
    to the Registrants
    Form 10-Q
    filed August 1, 2005).10.18*

Purchase Agreement dated as of August 4, 2005 by and among
    the Registrant and the Initial Purchasers named therein (Filed
    as Exhibit 10.1 to the Registrants
    Form 8-K
    filed August 9, 2005).10.19*

Asset Purchase Agreement dated as of December 12, 2005 by
    and between TriGenesys, Inc and the Registrant (Filed as
    Exhibit 10.22 to the Registrants
    Form 10-K
    for the fiscal year ended December 31, 2005).10.20*

Co-development and Commercialization Agreement between Novartis
    International Pharmaceutical Ltd. and Human Genome Sciences,
    Inc., dated June 5, 2006 (Filed as Exhibit 10.1 to the
    Registrants
    Form 10-Q
    filed August 9, 2006).10.21*

Purchase and Sale Agreement between BioMed Realty, L.P. and
    Human Genome Sciences, Inc., dated May 2, 2006 (Filed as
    Exhibit 10.2 to the Registrants
    Form 10-Q
    filed August 9, 2006).10.22*

Lease Agreement between BMR-Belward Campus Drive LSM LLC and
    Human Genome Sciences, Inc., dated May 24, 2006 (Filed as
    Exhibit 10.3 to the Registrants
    Form 10-Q
    filed August 9, 2006).10.23*

Lease Agreement between BMR-Shady Grove Road HQ LLC and Human
    Genome Sciences, Inc., dated May 24, 2006 (Filed as
    Exhibit 10.4 to the Registrants
    Form 10-Q
    filed August 9, 2006).10.24*

Solicitation (as amended) and Modification of Contract awarded
    by the Department of Health and Human Services to Human Genome
    Sciences, Inc. dated June 24, 2006 (Filed as
    Exhibit 10.5 to the Registrants Amended
    Form 10-Q
    filed September 27, 2007). 50




---



##### 



ExhibitNo.12.1

Ratio of Earnings to Fixed Charges.21.1

Subsidiaries.23.1

Consent of Ernst & Young LLP, Independent Registered
    Public Accounting Firm.31i.1

Rule 13a-14(a)
    Certification of Principal Executive Officer.31i.2

Rule 13a-14(a)
    Certification of Principal Financial Officer.32.1

Section 1350 Certification of Chief Executive Officer.32.2

Section 1350 Certification of Chief Financial Officer.     *
    
    Incorporated by reference.
    
    Confidential treatment requested for certain portions of this
    Exhibit pursuant to
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended, which
    portions are omitted and filed separately with the Securities
    and Exchange Commission. 51




---



##### 



SIGNATURES
      By: /s/  H.
    Thomas Watkins         Signature

Title

Date/s/  H.
    Thomas WatkinsH.
    Thomas Watkins

President, Chief Executive Officer and Director (Principal
    Executive Officer)

February 26, 2008/s/  Timothy
    C.  BarabeTimothy
    C.  Barabe

Senior Vice President and Chief Financial Officer (Principal
    Financial Officer and Principal Accounting Officer)

February 26, 2008/s/  Argeris
    N. Karabelas, Ph.D.Argeris
    N. Karabelas, Ph.D.

Chairman of the Board

February 26, 2008/s/  Richard
    J. DanzigRichard
    J. Danzig

Director

February 26, 2008/s/  Jürgen
    Drews, M.D.Jürgen
    Drews, M.D.

Director

February 26, 2008/s/  Maxine
    Gowen, Ph.D.Maxine
    Gowen, Ph.D.

Director

February 26, 2008/s/  Tuan
    Ha-NgocTuan
    Ha-Ngoc

Director

February 26, 2008/s/  Augustine
    LawlorAugustine
    Lawlor

Director

February 26, 2008/s/  Max
    Link, Ph.D.Max
    Link, Ph.D.

Director

February 26, 2008/s/  Robert
    C. Young, M.D.Robert
    C. Young, M.D.

Director

February 26, 2008  52




---



##### 



INDEX TO
    CONSOLIDATED FINANCIAL STATEMENTS
  PageNumberReport of Ernst & Young LLP, Independent Registered
    Public Accounting Firm


F-2Consolidated Balance Sheets at December 31, 2007 and 2006


F-3Consolidated Statements of Operations for the years ended
    December 31, 2007, 2006 and 2005


F-4Consolidated Statements of Stockholders Equity for the
    years ended December 31, 2007, 2006 
    and 2005


F-5Consolidated Statements of Cash Flows for the years ended
    December 31, 2007, 2006 and 2005


F-6Notes to Consolidated Financial Statements


F-8  F-1




---



##### 



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM  
                F-2




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  CONSOLIDATED BALANCE SHEETS
  December 31,2007


2006(dollars in thousands, except share and per share amounts)ASSETSCurrent assets:Cash and cash equivalents

$
34,815


$
96,942Short-term investments


93,952



226,475Collaboration receivables


38,672



64,479Prepaid expenses and other current assets


5,687



4,153Total current assets


173,126



392,049Marketable securities


404,142



378,502Long-term equity investments


18,245



15,437Property, plant and equipment (net of accumulated depreciation
    and amortization)


268,804



285,177Restricted investments


70,931



61,165Other assets


13,857



17,338TOTAL ASSETS

$
949,105


$
1,149,668LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)Current liabilities:Accounts payable and accrued expenses

$
62,876


$
36,959Accrued payroll and related taxes


14,448



15,378Accrued exit and restructuring expenses


3,627



4,243Deferred revenues


45,219



35,371Total current liabilities


126,170



91,951Long-term debt


754,099



751,526Deferred revenues, net of current portion


73,049



83,530Accrued exit and restructuring expenses, net of current portion


3,017



6,111Other liabilities


4,672



2,627Total liabilities


961,007



935,745Stockholders equity (deficit):Preferred stock  $0.01 par value; shares
    authorized  20,000,000; no shares issued or
    outstanding






Common stock  $0.01 par value; shares
    authorized  400,000,000; shares issued and
    outstanding of 134,936,512 and 133,820,053 at December 31,
    2007 and 2006, respectively


1,349



1,338Additional paid-in capital


1,866,426



1,836,560Accumulated other comprehensive income (loss)


3,152



(3,594
)Accumulated deficit


(1,882,829
)


(1,620,381
)Total stockholders equity (deficit)


(11,902
)


213,923TOTAL LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)

$
949,105


$
1,149,668    F-3




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  CONSOLIDATED STATEMENTS OF OPERATIONS
  Year Ended December 31,2007


2006


2005(dollars in thousands, except share and per share amounts)Revenue  research and development contracts

$
41,851


$
25,755


$
19,113Costs and expenses:Research and development


245,745



209,242



228,717General and administrative


55,874



53,101



42,066Lease termination and restructuring charges (credits)


(3,673
)


29,510



Total costs and expenses


297,946



291,853



270,783Income (loss) from operations


(256,095
)


(266,098
)


(251,670
)Investment income


32,988



27,131



24,218Interest expense


(39,341
)


(26,965
)


(12,085
)Gain on sale of equity investments






14,759



1,302Loss on extinguishment of debt










(1,204
)Income (loss) before taxes


(262,448
)


(251,173
)


(239,439
)Provision for income taxes










Net income (loss)

$
(262,448
)

$
(251,173
)

$
(239,439
)Basic and diluted net income (loss) per share

$
(1.95
)

$
(1.91
)

$
(1.83
)Weighted average shares of common stock outstanding, basic and
    diluted


134,333,418



131,815,414



130,772,233   Share-Based Payment Accounting for Stock-Based Compensation
 F-4




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  CONSOLIDATED
    STATEMENTS OF STOCKHOLDERS EQUITY (DEFICIT)
  AccumulatedAdditional


OtherCommon Stock


Paid-In


Comprehensive


AccumulatedShares


Amount


Capital


Income (Loss)


Deficit


Total(dollars in thousands, except share amounts)Balance  December 31, 2004


130,527,029


$
1,305


$
1,775,005


$
9,506


$
(1,129,769
)


$656,047Comprehensive income (loss):Net loss


















(239,439
)


(239,439
)Unrealized loss on investments














(11,177
)






(11,177
)Cumulative translation adjustment














(14
)






(14
)Comprehensive loss






















(250,630
)Shares of common stock issued pursuant to stock-based
    compensation plans


522,769



5



4,436











4,441Stock option modification expense










7,108











7,108Balance  December 31, 2005


131,049,798



1,310



1,786,549



(1,685
)


(1,369,208
)


416,966Comprehensive income (loss):Net loss


















(251,173
)


(251,173
)Unrealized loss on investments














(1,927
)






(1,927
)Cumulative translation adjustment














18







18Comprehensive loss






















(253,082
)Shares of common stock issued pursuant to stock-based
    compensation plans


2,770,255



28



23,405











23,433Stock-based compensation expense










26,606











26,606Balance  December 31, 2006


133,820,053



1,338



1,836,560



(3,594
)


(1,620,381
)


213,923Comprehensive income (loss):Net loss


















(262,448
)


(262,448
)Unrealized gain on investments














6,724







6,724Cumulative translation adjustment














22







22Comprehensive loss






















(255,702
)Shares of common stock issued pursuant to stock-based
    compensation plans


1,116,459



11



8,175











8,186Stock-based compensation expense










21,691











21,691Balance  December 31, 2007


134,936,512


$
1,349


$
1,866,426


$
3,152


$
(1,882,829
)

$
(11,902
)    F-5




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  CONSOLIDATED
    STATEMENTS OF CASH FLOWS
  Year Ended December 31,2007


2006


2005(dollars in thousands)Cash flows from operating activities:Net income (loss)

$
(262,448
)

$
(251,173
)

$
(239,439
)Adjustments to reconcile net income (loss) to net cash used in
    operating activities:Stock-based compensation or modification expense


21,691



26,606



7,108Depreciation and amortization


22,114



20,105



18,447Charge (credit) for lease termination and restructuring


(1,969
)


28,953



Gain on sale of building


(1,704
)






Gain on sale of long-term equity investments






(14,759
)


(1,302
)Accrued interest on short-term investments, marketable
    securities and restricted investments


(4,631
)


(5,607
)


(1,582
)Non-cash expense and other


2,995



5,307



3,144Non-cash reimbursement of CoGenesys expenses






(4,818
)


Changes in operating assets and liabilities:Collaboration receivables


25,807



(16,279
)


47Prepaid expenses and other assets


(366
)


5,292



3,841Accounts payable and accrued expenses


25,770



9,281



(2,154
)Accrued payroll and related taxes


(930
)


1,539



8,101Accrued exit and restructuring expenses


(2,376
)


(5,006
)


(4,144
)Deferred revenues


(633
)


54,591



(3,284
)Other liabilities


2,021



(1,162
)


(4,056
)Net cash used in operating activities


(174,659
)


(147,130
)


(215,273
)Cash flows from investing activities:Purchase of short-term investments and marketable securities


(160,379
)


(538,314
)


(253,952
)Proceeds from sale and maturities of short-term investments and
    marketable securities


278,031



504,970



548,936Capital expenditures  property, plant and equipment


(3,042
)


(9,719
)


(90,247
)Purchase of building, net of transaction costs


(13,120
)






Proceeds from sale of building, net of transaction costs


14,824







Purchase of long-term equity investment


(3,148
)






Proceeds from sale of long-term equity investments






24,127



4,600Capitalized interest






(2,527
)


(5,764
)Net cash provided by (used in) investing activities


113,166



(21,463
)


203,573Cash flows from financing activities:Payments on long-term debt






(3,120
)


(221,067
)Proceeds from sale and maturities of restricted investments


17,857



57,670



288,626Purchase of restricted investments


(26,642
)


(44,968
)


(295,441
)Proceeds from issuance of common stock


8,151



23,433



4,443Proceeds from sale-leaseback of property, plant and equipment






220,252



Proceeds from issuance of long-term debt










223,332Net cash provided by (used in) financing activities


(634
)


253,267



(107
)Net increase (decrease) in cash and cash equivalents


(62,127
)


84,674



(11,807
)Cash and cash equivalents  beginning of year


96,942



12,268



24,075Cash and cash equivalents  end of year

$
34,815


$
96,942


$
12,268  F-6




---



##### 



SUPPLEMENTAL
    DISCLOSURES OF CASH FLOW INFORMATION, NON-CASH OPERATING,
    INVESTING AND FINANCING ACTIVITIES
  Year Ended December 31,2007


2006


2005(dollars in thousands)Cash paid during the year for:Interest

$
34,319


$
25,540


$
17,570Income taxes

$



$



$
                   F-7




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share
    data)
  (NOTE A) 
    The
    Company        (NOTE B) 
    Summary
    of Significant Accounting Policies  Use of
    Estimates
    Principles
    of Consolidation
    Cash
    Equivalents, Short-term Investments, Marketable Securities and
    Long-term Equity Investments
     F-8




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE B) 
    Summary
    of Significant Accounting Policies (continued)  
 Cash
    Equivalents, Short-term Investments, Marketable Securities and
    Long-term Equity Investments (continued)
    Investment
    Risk
    Other-Than-Temporary
    Impairment of Investments
  No. 115-1, The Meaning of Other-Than-Temporary Impairment and Its
    Application to Certain Investments
  Depreciation
    and Amortization
    Buildings

30 yearsLand improvements

lesser of the lease term or the useful lifeProduction equipment

5-10 yearsLaboratory equipment

3-10 yearsComputer equipment and software

3-5 yearsFurniture and office equipment

3-5 yearsLeasehold improvements

lesser of the lease term or the useful life    Impairment
    of Long-Lived Assets
  Accounting
    for the Impairment or Disposal of Long-Lived Assets
  Fair
    Value of Financial Instruments
   F-9




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE B) 
    Summary
    of Significant Accounting Policies (continued)  
 Fair
    Value of Financial Instruments (continued)
      Leases
  Accounting for Leases,
  Stock-Based
    Compensation
    Accounting for Stock
    Issued to Employees
    No. 96-18, Accounting for Equity Instruments that are Issued to Other
    Than Employees for Acquiring, or in Conjunction with Selling,
    Goods, or Services.
 F-10




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE B) 
    Summary
    of Significant Accounting Policies (continued)  
 Stock-Based
    Compensation (continued)
    Year EndedDecember 31,2005Net income (loss), as reported

$
(239,439
)Deduct: Total stock-based employee compensation expense
    determined under fair value based method for all awards, net of
    related tax effects


(51,971
)Add: Stock-based compensation included in net income (loss)


7,108Pro forma net income (loss)

$
(284,302
)Net income (loss) per share:Basic and diluted  as reported

$
(1.83
)Basic and diluted  pro forma

$
(2.17
)       Revenue
    Recognition
     F-11




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE B) 
    Summary
    of Significant Accounting Policies (continued)  
 Revenue
    Recognition (continued)
    Research
    and Development
    Financing
    Costs Related to Long-term Debt
    Patent
    Application Costs
    Capitalization
    of Interest
    Net
    Income (Loss) Per Share
  Earnings Per Share
  Comprehensive
    Income (Loss)
  Reporting Comprehensive Income
 F-12




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE B) 
    Summary
    of Significant Accounting Policies (continued)  
 Comprehensive
    Income (Loss) (continued)
    Year Ended December 31,2007


2006


2005Net income (loss)

$
(262,448
)

$
(251,173
)

$
(239,439
)Net unrealized gains (losses):Short-term investments and marketable securities


5,959



4,314



(6,197
)Long-term equity investments


(340
)


6,254



(3,987
)Restricted investments


1,160



1,626



(1,875
)Foreign currency translation


22



18



(14
)Subtotal


6,801



12,212



(12,073
)Reclassification adjustments for realized (gains) losses
    included in net loss


(55
)


(14,121
)


882Total comprehensive income (loss)

$
(255,702
)

$
(253,082
)

$
(250,630
)         Recent
    Accounting Pronouncements
  Fair Value
    Measurements
  The Fair
    Value Option for Financial Assets and Financial Liabilities
 F-13




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE B) 
    Summary
    of Significant Accounting Policies (continued)  
 Recent
    Accounting Pronouncements (continued)
  No. 07-3, Accounting for Nonrefundable Advance Payments for Goods or
    Services Received for Use in Future Research and Development
    Activities No. 07-3). No. 07-3 No. 07-3
  Sources
    of Supply (continued)
    Reclassifications
   F-14




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
  (NOTE C) 
    Investments    December 31, 2007Gross


GrossAmortized


Unrealized


Unrealized


FairAvailable for Sale

Cost


Gains


Losses


ValueU.S. Treasury and agencies

$
2,028


$
12


$



$
2,040Government-sponsored enterprise securities


27,554



1,065



(127
)


28,492Corporate debt securities


64,072



12



(664
)


63,420Subtotal  Short-term investments


93,654



1,089



(791
)


93,952U.S. Treasury and agencies


29,417



689







30,106Government-sponsored enterprise securities


174,937



2,766



(608
)


177,095Corporate debt securities


197,205



1,381



(1,645
)


196,941Subtotal  Marketable securities


401,559



4,836



(2,253
)


404,142Investment in CoGenesys


14,818











14,818Investment in Aegera Therapeutics


3,168











3,168Investment in VIA Pharmaceuticals






259







259Subtotal  Long-term equity investments


17,986



259







18,245Cash and cash equivalents


10,158











10,158U.S. Treasury and agencies


7,049



38







7,087Government-sponsored enterprise securities


19,030



51



(51
)


19,030Corporate debt securities


34,732



101



(177
)


34,656Subtotal  Restricted investments


70,969



190



(228
)


70,931Total

$
584,168


$
6,374


$
(3,272
)

$
587,270   December 31, 2006Gross


GrossAmortized


Unrealized


Unrealized


FairAvailable for Sale

Cost


Gains


Losses


ValueU.S. Treasury and agencies

$
2,521


$
374


$
(9
)

$
2,886Government-sponsored enterprise securities


71,724



224



(654
)


71,294Corporate debt securities


153,106



101



(912
)


152,295Subtotal  Short-term investments


227,351



699



(1,575
)


226,475U.S. Treasury and agencies


15,124







(375
)


14,749Government-sponsored enterprise securities


165,554



524



(1,432
)


164,646Corporate debt securities


199,986



384



(1,263
)


199,107Subtotal  Marketable securities


380,664



908



(3,070
)


378,502Investment in CoGenesys


14,818











14,818Investment in VIA Pharmaceuticals






619







619Subtotal  Long-term equity investments


14,818



619







15,437Cash and cash equivalents


1,527











1,527U.S. Treasury and agencies


7,049







(212
)


6,837Government-sponsored enterprise securities


22,962



14



(503
)


22,473Corporate debt securities


30,812



5



(489
)


30,328Subtotal  Restricted investments


62,350



19



(1,204
)


61,165Total

$
685,183


$
2,245


$
(5,849
)

$
681,579  F-15




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE C) 
    Investments
    (continued)      Short-term
    investments, Marketable securities and Restricted
    investments  unrealized losses
    December 31, 2007Loss Position


Loss Positionfor Less Than


for Greater ThanTwelve Months


Twelve Months


TotalFair


Unrealized


Fair


Unrealized


Fair


UnrealizedValue


Losses


Value


Losses


Value


LossesGovernment-sponsored enterprise securities

$



$



$
4,211


$
127


$
4,211


$
127Corporate debt securities










57,293



664



57,293



664Subtotal  Short-term investments










61,504



791



61,504



791Government-sponsored enterprise securities










24,366



608



24,366



608Corporate debt securities


53,674



1,523



12,498



122



66,172



1,645Subtotal  Marketable securities


53,674



1,523



36,864



730



90,538



2,253Government-sponsored enterprise securities










11,685



51



11,685



51Corporate debt securities


1,951



29



15,583



148



17,534



177Subtotal  Restricted investments


1,951



29



27,268



199



29,219



228Total

$
55,625


$
1,552


$
125,636


$
1,720


$
181,261


$
3,272   F-16




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE C) 
    Investments
    (continued)  
 Short-term
    investments, Marketable securities and Restricted
    investments  unrealized losses (continued)
  December 31, 2006Loss Position


Loss Positionfor Less Than


for Greater ThanTwelve Months


Months


TotalFair


Unrealized


Fair


Unrealized


Fair


UnrealizedValue


Losses


Value


Losses


Value


LossesGovernment-sponsored enterprise securities

$
15,110


$
240


$
19,452


$
423


$
34,562


$
663Corporate debt securities


51,344



252



84,632



660



135,976



912Subtotal  Short-term investments


66,454



492



104,084



1,083



170,538



1,575Government-sponsored enterprise securities


56,585



1,089



20,500



718



77,085



1,807Corporate debt securities


64,222



456



47,267



807



111,489



1,263Subtotal  Marketable securities


120,807



1,545



67,767



1,525



188,574



3,070Government-sponsored enterprise securities


4,888



153



21,599



562



26,487



715Corporate debt securities


2,608



7



25,632



482



28,240



489Subtotal  Restricted investments


7,496



160



47,231



1,044



54,727



1,204Total

$
194,757


$
2,197


$
219,082


$
3,652


$
413,839


$
5,849      F-17




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE C) 
    Investments
    (continued)  Other
    Information
    Short-term


Marketable


RestrictedInvestments


Securities


InvestmentsAmortized


Fair


Amortized


Fair


Amortized


FairMaturities

Cost


Value


Cost


Value


Cost


ValueLess than one year

$
93,654


$
93,952


$



$



$
13,980


$
13,972Due in year two through 
    year three










286,129



287,226



46,513



46,422Due in year four through 
    year five










115,430



116,916



10,477



10,537Due after five years






















Total

$
93,654


$
93,952


$
401,559


$
404,142


$
70,970


$
70,931         Year Ended December 31,2007


2006


2005Net proceeds on sale of investments prior to maturity

$
123,522


$
334,250


$
510,800Realized gains


494



14,888



1,618Realized losses


(439
)


(767
)


(2,499
)       (NOTE D) 
    Collaborations
    and U.S. Government Agreement  Principal
    Agreements
  Agreement
    with Novartis
   F-18




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE D) 
    Collaborations
    and U.S. Government Agreement (continued)  
 Principal
    Agreements (continued)
  
 Agreement
    with Novartis (continued)
    Agreements
    with GlaxoSmithKline (formerly SmithKline Beecham
    Corporation)
  co-development
        ®
 F-19




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE D) 
    Collaborations
    and U.S. Government Agreement (continued)  
 Principal
    Agreements (continued)
  
 Agreements
    with GlaxoSmithKline (formerly SmithKline Beecham Corporation)
    (continued)
    License
    Agreement and Manufacturing Services Agreement with
    CoGenesys
    Collaboration
    reimbursements with respect to Novartis and GSK
    U.S.
    Government Agreement
  in vitro in
    vivo
 F-20




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE D) 
    Collaborations
    and U.S. Government Agreement (continued)  
 Principal
    Agreements (continued)
  Other
    Collaborative and License Agreements
          (NOTE E) 
    Collaboration
    Receivables   F-21




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
  (NOTE F) 
    Property,
    Plant and Equipment    December 31,2007


2006Building (Large-Scale Manufacturing Facility)

$
187,737


$
187,367Laboratory and production equipment


82,836



84,596Computer equipment and software


33,761



33,534Land and improvements


30,521



30,521Leasehold improvements


22,589



23,679Furniture and office equipment


5,908



6,517Construction-in-progress


3,419



2,047366,771



368,261Less: accumulated depreciation and amortization


(97,967
)


(83,084
)$
268,804


$
285,177     Construction-in-progress
  (NOTE G) 
    Other
    Assets    December 31,2007


2006Deferred financing costs, net of accumulated amortization of
    $6,539 and $4,226, as of December 31, 2007 and 2006,
    respectively

$
11,122


$
13,435Prepaid services


2,600



3,800All other assets


135



103$
13,857


$
17,338      F-22




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
  (NOTE H) 
    Accounts
    Payable and Accrued Expenses    December 31,2007


2006Clinical trial costs

$
46,848


$
17,606Professional fees


5,940



7,502Accrued expenses and fixed asset purchases


6,844



8,598Accrued interest


3,244



3,253$
62,876


$
36,959    (NOTE I) 
    Long-Term
    Debt    December 31,





December 31,Debt

2007 Interest Rates


Maturities


2007


20062.25% Convertible Subordinated Notes due 2011


2.25
%


October 2011


$
280,000


$
280,0002.25% Convertible Subordinated Notes due 2012


2.25
%


August 2012



230,000



230,000BioMed lease commitment


11.0
%


May 2026



244,099



241,526754,099



751,526Less current portion














$
754,099


$
751,526     2008

$
2009


2010


2011


280,0002012


230,0002013 and thereafter


52,961$
562,961    F-23




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE I) 
    Long-Term
    Debt (continued)    1 4 1 4 1 4 1 4 1 4 1 4 1 4 1 4
  1 4 1 4 1 4 1 4 1 4 1 4 1 4 1 4
    December 31,2007


2006Carrying


Fair


Carrying


FairAmount


Value


Amount


Value2.25% Convertible Subordinated Notes due 2011

$
280,000


$
266,000


$
280,000


$
296,1002.25% Convertible Subordinated Notes due 2012


230,000



198,950



230,000



223,675BioMed lease commitment


244,099



244,099



241,526



241,526$
754,099


$
709,049


$
751,526


$
761,301    F-24




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE I) 
    Long-Term
    Debt (continued)        (NOTE J) 
    Commitments and Other Matters
  Leases
    Gross Operating





Net OperatingYear Ending December 31,

Leases


Sublease Income


Leases2008

$
22,219


$
(4,466
)

$
17,7532009


23,002



(4,555
)


18,4472010


21,686



(4,646
)


17,0402011


22,009



(4,342
)


17,6672012


22,371







22,3712013 and thereafter


311,233







311,233$
422,520


$
18,009


$
404,511        F-25




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE J) 
    Commitments and Other Matters (continued)
  Leases (continued)
        Accounting for Costs Associated with
    Exit Or Disposal Activities
       F-26




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE J) 
    Commitments and Other Matters (continued)
  Leases (continued)
            Capital
    Expenditures
    401(k)
    Plan
    Contingent
    Liabilities
   F-27




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE J) 
    Commitments and Other Matters (continued)
  
 Contingent
    Liabilities (continued)
      (NOTE K) 
    Stockholders Equity
  Stock-based
    Compensation Plans
    Year Ended December 31,2007


2006


2005Employee stock option and employee stock purchase plan
    compensation expense

$
20,691


$
26,095


$
Restricted stock awards


530



511



123Restricted stock units


470







Stock option modification expense










6,985Total

$
21,691


$
26,606


$
7,108     Stock
    Incentive Plan
     F-28




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE K) 
    Stockholders Equity (continued)
  
 Stock-based
    Compensation Plans (continued)
  
 Stock
    Incentive Plan (continued)
    Weighted-


Weighted-AverageAverage


Remaining


AggregateExercise


Contractual Term


IntrinsicShares


Price


(Years)


Value(1)Outstanding at January 1, 2007


26,836,107


$
18.22



5.39Granted


4,224,846



10.41Exercised


(968,501
)


7.38






$
3,244Forfeited


(534,696
)


11.31Expired


(1,436,227
)


20.48Outstanding at December 31, 2007


28,121,529



17.44



5.47



7,667Vested or expected to vest at December 31,
    2007


27,031,281



17.71



3.96



7,451Exercisable at December 31, 2007


20,853,208



19.75



4.38



6,228     (1)
    
    Aggregate intrinsic value represents only the value for those
    options in which the exercise price of the option is less than
    the market value of the Companys stock on
    December 31, 2007, or for exercised options, the exercise
    date.    Options Outstanding


Options ExercisableWeighted-AverageRemaining


Weighted-AverageNumber


Contractual Life


Exercise


Number


Weighted-AverageRange of Exercise Price

Outstanding


(In Years)


Price


Exercisable


Exercise Price$6.60 to $10.00


4,697,691



4.11


$
8.86



3,801,954


$
8.82$10.01 to $12.48


11,493,758



7.55



11.09



6,154,062



11.39$12.49 to $15.00


5,654,320



5.67



12.77



4,627,781



12.77$15.01 to $21.47


864,440



4.51



17.06



858,091



17.08$21.48 to $86.19


5,411,320



2.16



43.33



5,411,320



43.3328,121,529



5.47



17.44



20,853,208



19.75    F-29




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE K) 
    Stockholders Equity (continued)
  
 Stock-based
    Compensation Plans (continued)
  
 Stock
    Incentive Plan (continued)
            Years Ended December 31,2007

2006

2005Expected life:Stock options

5.0 years

4.9 years

4.4 yearsEmployee stock purchase plan rights

1.0 years

1.0 years

1.0 yearsInterest rate

3.4% - 4.9%

4.3% - 5.1%

3.8% - 4.2%Volatility

40.3% - 48.0%

38.0% - 48.0%

38.0% - 40.0%Dividend yield

0%

0%

0%     Expected Life of Stock-based Awards
  Interest Rate
  Volatility
  Dividend Yield
 F-30




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE K) 
    Stockholders Equity (continued)
  
 Stock-based
    Compensation Plans (continued)
  
 Stock
    Incentive Plan (continued)
  Restricted
    Stock
    :
  Weighted-AverageGrant-Date FairShares


ValueRestricted stock at January 1, 2007


105,000


$
12.88Granted


250,274



10.62Vested


(20,500
)


12.87Forfeited


(9,787
)


10.62Restricted stock at December 31, 2007


324,987



11.21       Employee
    Stock Purchase Plan
    (NOTE L) 
    Preferred
    Share Purchase Rights   F-31




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE L) 
    Preferred
    Share Purchase Rights (continued)        (NOTE M) 
    Income
    Taxes    Year Ended December 31,2007


2006


2005Federal income tax provision at 34%

$
(89,232
)

$
(85,399
)

$
(81,409
)Change in state income tax rate


(15,762
)






State taxes, net of federal tax benefit


(11,638
)


(11,041
)


(10,732
)Tax credits, principally for research and development


(2,911
)


(7,305
)


(6,930
)Stock option deduction for which no book benefit is available










(560
)Other


3,585



4,146



2,426Increase in valuation allowance on deferred tax asset


115,958



99,599



97,205$



$



$
    F-32




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE M) 
    Income
    Taxes (continued)    Current


Long-TermAsset


Asset/(Liability)December 31, 2007Net operating loss carryforward

$



$
651,745Research and development and other tax credit carryforwards






30,218Capital loss carryforward






13,528Deferred revenue


17,837



28,814Lease impairment charge






5,067Net unrealized gains on investments






(1,205
)Intangible assets


394



5,391Equity based compensation






8,700Depreciation






5,189Reserves and accruals


2,857



11,984Other






2,08121,088



761,512Less valuation allowance


(21,088
)


(761,512
)$



$
   Current


Long-TermAsset


AssetDecember 31, 2006Net operating loss carryforward

$



$
555,508Research and development and other tax credit carryforwards






59,651Capital loss carryforward






12,933Deferred revenue


13,660



32,259Lease impairment charge






5,489Net unrealized losses on investments






1,392Equity based compensation






4,559Depreciation






3,333Reserves and accruals


3,066



7,128Other






69216,726



682,944Less valuation allowance


(16,726
)


(682,944
)$



$
    F-33




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE M) 
    Income
    Taxes (continued)    Year Ended December 31,2007


2006


2005Current:Federal

$



$



$
State










Foreign taxes










Deferred










$



$



$
     Accounting for Uncertainty in Income
    Taxes  An Interpretation of FASB Statement
    No. 109
      Balance as of January 1, 2007

$
28,641Gross increases related to prior year tax positions


Gross increases related to current year tax positions


970Balance as of December 31, 2007

$
29,611      (NOTE N) 
    Facility-Related
    Exit Costs and Other Restructuring Charges   F-34




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE N) 
    Facility-Related
    Exit Costs and Other Restructuring Charges
    (continued)            Accounting for Costs Associated with
    Exit Or Disposal Activities
     F-35




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE N) 
    Facility-Related
    Exit Costs and Other Restructuring Charges
    (continued)        Facilities


OtherRelated


Charges


TotalBalance as of January 1, 2007

$
10,336


$
18


$
10,354Accretion recorded


653







653Subtotal


10,989



18



11,007Cash paid


(2,376
)






(2,376
)Accrual adjustment


(1,969
)


(18
)


(1,987
)Balance as of December 31, 2007

$
6,644


$




6,644Less current portion










3,627$
3,017    (NOTE O) 
    CoGenesys     F-36




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE O) 
    CoGenesys
    (continued)      (NOTE P) 
    Net
    Loss Per Share    Year Ended December 31,2007


2006


2005Numerator:Net loss

$
(262,448
)

$
(251,173
)

$
(239,439
)Denominator:Denominator for basic and diluted earnings per share 
    weighted-average shares


134,333,418



131,815,414



130,772,233Net loss per share, basic and diluted:Net loss per share

$
(1.95
)

$
(1.91
)

$
(1.83
)     (NOTE Q) 
    Related
    Parties       F-37




---



##### 



HUMAN
    GENOME SCIENCES, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 (dollars in thousands, except share and per share data)
   (NOTE Q) 
    Related
    Parties (continued)      (NOTE R) 
    Quarterly
    Financial Information (unaudited)    1st
    Quarter


2ndQuarter


3rd
    Quarter


4th
    Quarter2007Revenue

$
9,262


$
9,007


$
11,056


$
12,526Income (loss) from operations


(49,886
)


(49,864
)


(65,434
)


(90,911
)Net income (loss)


(51,029
)


(51,269
)


(67,257
)


(92,893
)Net income (loss) per share, basic and diluted


(0.38
)


(0.38
)


(0.50
)


(0.69
)2006Revenue

$
6,840


$
2,225


$
6,679


$
10,011Income (loss) from operations


(64,958
)


(77,020
)


(58,975
)


(65,145
)Net income (loss)


(62,139
)


(61,258
)


(60,832
)


(66,944
)Net income (loss) per share, basic and diluted


(0.47
)


(0.47
)


(0.46
)


(0.50
)          F-38