##### 





UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
 Washington, DC 20549
  Form 10-K
   FOR ANNUAL AND TRANSITION
    REPORTS
    PURSUANT TO SECTIONS 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934
  (Mark One)þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
    December 31, 2007oro

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the transition period
    from          to   Commission file number: 0-50440
  Micromet, Inc.
 (Exact name of registrant as
    specified in its charter)
  Delaware

52-2243564(State or other jurisdiction
    of
    incorporation or organization)

(I.R.S. Employer
    Identification No.)6707 Democracy Boulevard, Suite 505
    Bethesda, MD(Address of principal
    executive offices)

20817(Zip Code)   (240) 752-1420
 (Registrants telephone number, including area code)
  Securities registered pursuant to Section 12(b) of the
    Act:
  Title of Each Class

Name of Each Exchange on Which RegisteredCommon Stock, par value $0.00004 per share

Nasdaq Global Market   Securities registered pursuant to Section 12(g) of the
    Act:
 None
  o þ
  o þ
    þ o
  Regulation S-K Form 10-K Form 10-K. þ
  Rule 12b-2
  Large accelerated
    filer o

Accelerated
    filer o

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

Smaller reporting
    company þ   Rule 12b-2 o þ
      DOCUMENTS
    INCORPORATED BY REFERENCE




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MICROMET,
    INC.
    ANNUAL REPORT ON
    FORM 10-K
    FOR THE YEAR ENDED DECEMBER 31, 2007
    Table of Contents
 PagePART IItem 1


Business


1Item 1A


Risk Factors


24Item 1B


Unresolved Staff Comments


43Item 2


Properties


43Item 3


Legal Proceedings


43Item 4


Submission of Matters to a Vote of Security Holders


43PART IIItem 5


Market for Registrants Common Equity, Related Stockholder
    Matters and Issuer Purchases of Equity Securities


43Item 6


Selected Financial Data


44Item 7


Managements Discussion and Analysis of Financial Condition
    and Results of Operations


44Item 7A


Quantitative and Qualitative Disclosures About Market Risk


55Item 8


Financial Statements and Supplementary Data


55Item 9


Changes in and Disagreements With Accountants on Accounting and
    Financial Disclosure


55Item 9A


Controls and Procedures


55Item 9B


Other Information


59PART IIIItem 10


Directors, Executive Officers and Corporate Governance


59Item 11


Executive Compensation


59Item 12


Security Ownership of Certain Beneficial Owners and Management
    and Related Stockholder Matters


60Item 13


Certain Relationships and Related Transactions and Director
    Independence


60Item 14


Principal Accountant Fees and Services


60PART IVItem 15


Exhibits and Financial Statement Schedules


60Signatures


65




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##### 



PART I  Item 1.
    Business  INFORMATION
    REGARDING MICROMETS BUSINESS
  Company
    Overview
  ®
  Corporate
    History
      Market
    Overview
   1




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##### 



Immunotherapy
    for the Treatment of Cancer
  Background
        BiTE
    Antibody Technology Platform
     2




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##### 



Cancer
    Indications Targeted by Our Product Candidates
  Non-Hodgkins
    Lymphoma and Acute Lymphoblastic Leukemia
    Current
    Therapies for NHL
  ® ®
    ®
 3




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##### 



Current
    Therapies for ALL
    Our
    Approach with MT103
    ® ® ®
  Breast
    Cancer and other EpCAM-expressing Solid Tumors
    EpCAM as
    a Target for Antibody Therapies
     4




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##### 



Overview
    of Current Therapies
  ® ® ®
  Current
    Therapies for Breast Cancer
    ®
  ®
  (ER -/PR -)
  Current
    Therapies for Colorectal Cancer
   5




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##### 



Unmet
    Medical Need
    
    Therapies that more effectively prolong survival and improve
    quality of life for patients;
    Less toxic, more convenient secondary therapies to prolong time
    to disease progression, reduce disease-related symptoms, and
    improve quality of life;
    Therapies that increase the overall survival of patients, such
    as neoadjuvant treatment regimens; and
    Therapies that are effective in patients who do not respond to
    currently available therapies, for example, because their tumor
    cells do not express HER-2 and are thus not responsive to the
    treatment with
    Herceptin®.  Our
    Approach with Adecatumumab and MT110
  ®
 6




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##### 



Our
    Product Pipeline
    Product Candidate

Primary Indication

StatusBiTE AntibodiesMT103

Acute Lymphoblastic Leukemia

Phase 2Non-Hodgkins Lymphoma

Phase 1MT110

Adenocarcinoma

IMPD/IND StageMT111

Selected Cancers

PreclinicalEphA2 BiTE antibody

Selected Cancers

PreclinicalMCSP BiTE antibody

Melanoma

PreclinicalConventional AntibodiesAdecatumumab (MT201)

Metastatic Breast Cancer and other Adenocarcinoma

Phase 2 completedMetastatic Breast Cancer in combination with Docetaxel

Phase 1bMT293

Solid Tumors

Phase 1MT228

Melanoma

PreclinicalMT203

Inflammatory Diseases

PreclinicalMT204

Inflammatory Diseases

Preclinical   MT103
  Overview
        Mechanism
    of Action
   7




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##### 



Clinical
    Trials
  Phase 2
    Clinical Trial in ALL
    Phase 1
    Clinical Trial in Relapsed-Refractory NHL
    levels 4-5 15-60 2
   8




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##### 



Regulatory
    Pathway
      MT110
    Preclinical
    Activities
    Clinical
    Trials
    MT111
      EphA2
    BiTE Antibody
   9




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##### 



in vitro in vivo
    BiTE
    Antibodies in Early Development
  in vitro
  Adecatumumab
    (MT201)
    60-minute
    Clinical
    Trials
  Phase 1
    Clinical Trial in Metastatic Breast Cancer (Adecatumumab in
    Combination with Docetaxel)
    Safety
    Profile and Lack of Immunogenicity
   10




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##### 



Additional
    Clinical Trials
    MT293
  Overview
    Clinical
    Trials
    Mechanism
    of Action
    MT228
   11




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##### 



MT203
    Mechanism
    of Action and Preclinical Activities
  ® ® ®
    MT204
  anti-inflammatory ® ® ®
  Mechanism
    of Action and Preclinical Activities
  ® ® ® IL-2
 12




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##### 



Our
    Business Strategy
    
    Co-develop Compounds with Established Pharmaceutical and
    Biopharmaceutical Companies.We are collaborating
    with Merck Serono, MedImmune and Nycomed on ongoing clinical and
    preclinical development programs.
    Maintain Commercialization Opportunities in
    Collaborations.We retained full
    commercialization rights for MT103 outside of North America and
    for MT111 in Europe. In addition, we have retained an option to
    co-promote adecatumumab in Europe and the U.S., and the EphA2
    BiTE antibody in Europe. We intend to continue to pursue this
    partnering strategy in future collaborations.
    Advance the Development of Our Preclinical Product
    Candidates.We have completed the preclinical
    development of MT110, and we are advancing six BiTE antibodies
    through various stages of preclinical development and lead
    optimization.
    Pursue Additional Collaborations for Our Product
    Candidates.We established collaborations for
    MT293 and MT203 in 2007, and we will continue to seek strategic
    collaborations for some or all of the remaining product
    candidates in our product portfolio.
    Leverage Our Internal Pipeline Generating
    Capabilities.Our current pipeline of BiTE
    antibodies as well as conventional human IgG1 antibodies have
    all been generated by personnel employed by us, with the
    exception of MT293 and MT228, which were in-licensed previously
    by CancerVax. We will continue to leverage that capability for
    our early-stage development collaborations, as well as for
    generating additional product candidates for our own pipeline,
    especially new product candidates based on the proprietary BiTE
    antibody technology platform.  Intellectual
    Property
      continuations-in-part
 13




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##### 



License
    Agreements and Collaborations
    Agreements
    Relevant for the Generation of Antibodies and for the BiTE
    Antibody Technology Platform
  License
    Agreement with Isogenis/Biohybrid
      License
    Agreement with Roche
    Purchase
    Agreement with Curis
    Research
    and License Agreement with Merck KGaA/Biovation
   14




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##### 



License
    Agreement with Enzon
        License
    Agreement with Cambridge Antibody Technology and Enzon
        Agreements
    Relevant for MT103
    Collaboration
    Agreement with MedImmune
   15




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##### 



Agreements
    Relevant for MT110
    Agreements
    Relevant for MT111 and EphA2 BiTE Antibody
  BiTE
    Research Collaboration Agreement with MedImmune
      Licensing
    of Single-Chain Antibody Patents
  Exclusive
    IP Marketing Agreement with Enzon
      License
    Agreements with Various Parties pursuant to the Exclusive IP
    Marketing Agreement
   16




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##### 



Agreements
    Relevant for Adecatumumab (MT201)
  Transfer
    Agreement with Inventors
    License
    Agreement with Dyax
    License
    Agreement with Cambridge Antibody Technology
    Manufacturing
    and Supply Agreement with Boehringer Ingelheim
      Collaboration
    Agreement with Merck Serono
     17




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##### 



Agreements
    Relevant for MT293
  License
    Agreement with the University of Southern California
    Collaboration
    Agreement with Applied Molecular Evolution/Eli Lilly
    License
    Agreement with TRACON Pharmaceuticals
   18




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##### 



Agreements
    Relevant for MT203
  License
    Agreement with Enzon
    License
    Agreement with Cambridge Antibody Technology
    Collaboration
    and License Agreement with Nycomed
      Agreements
    Relevant for MT204
  License
    Agreement with Enzon
   19




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##### 



Agreements
    Relevant for MT228
  License
    Agreement with M-Tech (now Human Monoclonals International,
    Inc.)
    Sublicense
    Agreement with Morphotek
    Agreements
    Relevant for EGF, TGF-alpha and HER-1 Vaccine
    Programs
    Other
    License Agreements
    Manufacturing
    and Supply
   20




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##### 



Government
    Regulation and Product Approval
  General
    FDA
    Approval Process
         21




---



##### 



Regulatory
    Requirements in Europe and Other Countries
    Competition
    Non-Hodgkins
    Lymphoma (NHL)
    ®
 22




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##### 



® ®
  ® ®
  Colorectal
    Cancer
  ®
  ®
  tm
  Breast
    Cancer
    ® ®
  ®
 23




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##### 



®
  ® ® tm
  ® (BAY-43-9006).
  Employees
    Available
    Investor Information
  Form 10-K, Form 10-Q, Form 8-K, http://www.micromet-inc.com. (240) 235-0250
 Item 1A.  Risk
    Factors  The following information sets forth factors that could cause
    our actual results to differ materially from those contained in
    forward-looking statements we have made in this report and the
    information incorporated herein by reference and those we may
    make from time to time. Certain factors individually or in
    combination with others may have a material adverse effect on
    our business, financial condition and results of operations and
    you should carefully consider them.
  Risks
    Relating to Our Financial Results, Financial Reporting and Need
    for Financing
  We
    have a history of losses, we expect to incur substantial losses
    and negative operating cash flows for the foreseeable future and
    we may never achieve or maintain profitability.
   24




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##### 



We
    will require additional financing, which may be difficult to
    obtain and may dilute your ownership interest in us. If we fail
    to obtain the capital necessary to fund our operations, we will
    be unable to develop or commercialize our product candidates and
    our ability to operate as a going concern may be adversely
    affected.
    
    continued progress in our research and development programs, as
    well as the scope of these programs;
    our ability to establish and maintain collaborative arrangements
    for the discovery, research or development of our product
    candidates;
    the timing, receipt and amount of research funding and
    milestone, license, royalty and other payments, if any, from
    collaborators;
    the timing, receipt and amount of sales revenues and associated
    royalties to us, if any, from our product candidates in the
    market;
    our ability to sell shares of our common stock under our
    committed equity financing facility, or CEFF, with Kingsbridge
    Capital Limited, or Kingsbridge;
    the costs of preparing, filing, prosecuting, maintaining,
    defending and enforcing patent claims and other patent-related
    costs, including litigation costs and technology license fees;
    costs associated with litigation; and
    competing technological and market developments.     25




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##### 



Our
    committed equity financing facility with Kingsbridge may not be
    available to us if we elect to make a draw down, may require us
    to make additional blackout or other payments to
    Kingsbridge and may result in dilution to our
    stockholders.
    
    a minimum price for our common stock that is not less than 85%
    of the closing price of the day immediately preceding the
    applicable
    eight-day
    pricing period, but in no event less than $2.00 per share;
    the accuracy of representations and warranties made to
    Kingsbridge;
    our compliance with all applicable laws which, if we failed to
    so comply, would have a Material Adverse Effect (as that term is
    defined in the purchase agreement with Kingsbridge); and
    the effectiveness of a registration statement registering for
    resale the shares of common stock to be issued in connection
    with the CEFF.        eight-day
 26




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##### 



Our
    quarterly operating results and stock price may fluctuate
    significantly.
    
    the status of development of our product candidates;
    the time at which we enter into research and license agreements
    with strategic collaborators that provide for payments to us,
    and the timing and accounting treatment of payments to us, if
    any, under those agreements;
    whether or not we achieve specified research, development or
    commercialization milestones under any agreement that we enter
    into with strategic collaborators and the timely payment by
    these collaborators of any amounts payable to us;
    the addition or termination of research programs or funding
    support;
    the timing of milestone payments under license agreements,
    repayments of outstanding amounts under loan agreements, and
    other payments that we may be required to make to others;
    variations in the level of research and development expenses
    related to our clinical or preclinical product candidates during
    any given period;
    the change in fair value of the common stock warrants issued to
    investors in connection with our 2007 private placement
    financing, remeasured at each balance sheet date using a
    Black-Scholes option-pricing model, with the change in value
    recorded as other income or expense; and
    General market conditions affecting companies with our risk
    profile and market capitalization.    If the
    estimates we make and the assumptions on which we rely in
    preparing our financial statements prove inaccurate, our actual
    results may vary significantly.
    Changes
    in, or interpretations of, accounting rules and regulations
    could result in unfavorable accounting charges or require us to
    change our compensation policies.
    Our
    operating and financial flexibility, including our ability to
    borrow money, is limited by certain debt
    arrangements.
   27




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##### 




    our ability to obtain additional financing, if necessary, for
    working capital, capital expenditures, acquisitions or other
    purposes may be impaired or such financing may not be available
    on favorable terms;
    payments on our indebtedness will reduce the funds that would
    otherwise be available for our operations and future business
    opportunities;
    we may be more highly leveraged than our competitors, which may
    place us at a competitive disadvantage; and
    our debt level may reduce our flexibility to respond to changing
    business and economic conditions.  We
    have determined and further received an opinion from our
    independent registered public accounting firm in connection with
    our year-end audit for 2007 that our system of internal control
    over financial reporting does not meet the requirements of
    Section 404 of the Sarbanes-Oxley Act of 2002. As a result,
    investors could lose confidence in the reliability of our
    internal control over financial reporting, which could have a
    material adverse effect on our stock price.
       28




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##### 



Risks
    Relating to Our Common Stock
  Substantial
    sales of shares may adversely impact the market price of our
    common stock and our ability to issue and sell shares in the
    future.
    Our
    stock price may be volatile, and you may lose all or a
    substantial part of your investment.
    
    our ability to upgrade and implement our disclosure controls and
    our internal control over financial reporting;
    our ability to successfully raise capital to fund our continued
    operations;
    our ability to successfully develop our product candidates
    within acceptable timeframes;
    changes in the regulatory status of our product candidates;
    changes in significant contracts, strategic collaborations, new
    technologies, acquisitions, commercial relationships, joint
    ventures or capital commitments;
    the execution of new collaboration agreements or termination of
    existing collaborations related to our clinical or preclinical
    product candidates or our BiTE antibody technology platform;
    announcements of the invalidity of, or litigation relating to,
    our key intellectual property;
    announcements of the achievement of milestones in our agreements
    with collaborators or the receipt of payments under those
    agreements;
    announcements of the results of clinical trials by us or by
    companies with commercial products or product candidates in the
    same therapeutic category as our product candidates;
    events affecting our collaborators;
    fluctuations in stock market prices and trading volumes of
    similar companies;
    announcements of new products or technologies, clinical trial
    results, commercial relationships or other events by us, our
    collaborators or our competitors;
    our ability to successfully complete strategic collaboration
    arrangements with respect to our product candidates;
    variations in our quarterly operating results;
    changes in securities analysts estimates of our financial
    performance or product development timelines;
    changes in accounting principles;
    sales of large blocks of our common stock, including sales by
    our executive officers, directors and significant stockholders;
    additions or departures of key personnel; and 29




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##### 




    discussions of Micromet or our stock price by the financial and
    scientific press and online investor communities such as chat
    rooms.  If our
    officers and directors choose to act together, they can
    significantly influence our management and operations in a
    manner that may be in their best interests and not in the best
    interests of other stockholders.
    Our
    stockholder rights plan, anti-takeover provisions in our
    organizational documents and Delaware law may discourage or
    prevent a change in control, even if an acquisition would be
    beneficial to our stockholders, which could affect our stock
    price adversely and prevent attempts by our stockholders to
    replace or remove our current management.
    
    dividing our board of directors into three classes serving
    staggered three-year terms;
    prohibiting our stockholders from calling a special meeting of
    stockholders;
    permitting the issuance of additional shares of our common stock
    or preferred stock without stockholder approval;
    prohibiting our stockholders from making certain changes to our
    amended and restated certificate of incorporation or amended and
    restated bylaws except with
    662/3%
    stockholder approval; and
    requiring advance notice for raising matters of business or
    making nominations at stockholders meetings.    We may
    become involved in securities class action litigation that could
    divert managements attention and harm our business and our
    insurance coverage may not be sufficient to cover all costs and
    damages.
   30




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##### 



Risks
    Relating to Our Collaborations and Clinical Programs
  We are
    dependent on collaborators for the development and
    commercialization of many of our product candidates. If we lose
    any of these collaborators, or if they fail or incur delays in
    the development or commercialization of our current and future
    product candidates, our operating results would
    suffer.
    
    Each of our collaborators has significant discretion in
    determining the efforts and resources that it will apply to the
    collaboration. The timing and amount of any future royalty and
    milestone revenue that we may receive under such collaborative
    and licensing arrangements will depend on, among other things,
    such collaborators efforts and allocation of resources.
    All of our strategic collaboration and license agreements are
    for fixed terms and are subject to termination under various
    circumstances, including, in some cases, on short notice without
    cause. If any of our collaborative partners were to terminate
    its agreement with us, we may attempt to identify and enter into
    an agreement with a new collaborator with respect to the product
    candidate covered by the terminated agreement. If we are not
    able to do so, we may not have the funds or capability to
    undertake the development, manufacturing and commercialization
    of that product candidate, which could result in a
    discontinuation or delay of the development of that product
    candidate.
    Our collaborators may develop and commercialize, either alone or
    with others, products and services that are similar to or
    competitive with the product candidates and services that are
    the subject of their collaborations with us or programs licensed
    from us.
    Our collaborators may discontinue the development of our product
    candidates in specific indications, for example as a result of
    their assessment of the results obtained in clinical trials, or
    fail to initiate the development in indications that have a
    significant commercial potential.
    Pharmaceutical and biotechnology companies from time to time
    re-evaluate their research and development priorities, including
    in connection with mergers and consolidations, which have been
    common in recent years in these industries. The ability of our
    product candidates involved in strategic collaborations to reach
    their potential could be limited if, as a result of such
    changes, our collaborators decrease or fail to increase spending
    related to such product candidates, or decide to discontinue the
    development of our product candidates and terminate their
    collaboration or license agreement with us. In the event of such
    a termination, we may not be able to identify and enter into a
    collaboration agreement for our product candidates with another
    pharmaceutical company on terms favorable to us or at all, and
    we may not have sufficient financial resources to continue the
    development program for these product candidates on our own. As
    a result, we may incur delays in the development for these
    product candidates following any potential termination of the
    collaboration agreement, or we may need to reallocate financial
    resources that may cause delays in other development programs
    for our other product candidates.  We may
    not be successful in establishing additional strategic
    collaborations, which could adversely affect our ability to
    develop and commercialize product candidates.
   31




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##### 



If the
    combination of adecatumumab (MT201) with cytotoxics, such as
    docetaxel, is not tolerable or safe, if higher serum levels of
    adecatumumab cannot be administered safely, or if sufficient
    anti-tumor activity cannot be shown, we and our collaborator
    Merck Serono may decide to abandon all or part of the
    development program, and we could experience a material adverse
    impact on our results of operations.
    We
    previously terminated three phase 1 trials involving short-term
    infusion regimens of MT103 due to adverse side effects and a
    lack of perceived tumor response, and there can be no assurance
    that our current continuous infusion phase 1 clinical trial of
    MT103 will produce a different outcome.
  2
  Risks
    Relating to Our Operations, Business Strategy, and the Life
    Sciences Industry
  We
    face substantial competition, which may result in our
    competitors discovering, developing or commercializing products
    before or more successfully than we do.
     32




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##### 



We may
    not be successful in our efforts to expand our portfolio of
    product candidates.
    The
    product candidates in our pipeline are in early stages of
    development and our efforts to develop and commercialize these
    product candidates are subject to a high risk of delay and
    failure. If we fail to successfully develop our product
    candidates, our ability to generate revenues will be
    substantially impaired.
  time-consuming,
      sub-indications
   33




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##### 



We
    rely heavily on third parties for the conduct of preclinical and
    clinical studies of our product candidates, and we may not be
    able to control the proper performance of the studies or
    trials.
    Even
    if we complete the lengthy, complex and expensive development
    process, there is no assurance that we or our collaborators will
    obtain the regulatory approvals necessary for the launch and
    commercialization of our product candidates.
     34




---



##### 



We and
    our collaborators are subject to governmental regulations other
    than those imposed by the FDA and EMEA, and we or our
    collaborators may not be able to comply with these regulations.
    Any
    non-compliance
    could subject us or our collaborators to penalties and otherwise
    result in the limitation of our or our collaborators
    operations.
    Our
    growth could be limited if we are unable to attract and retain
    key personnel and consultants.
      If our
    third-party manufacturers do not follow current good
    manufacturing practices or do not maintain their facilities in
    accordance with these practices, our product development and
    commercialization efforts may be harmed.
   35




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##### 



Even
    if regulatory authorities approve our product candidates, we may
    fail to comply with ongoing regulatory requirements or
    experience unanticipated problems with our product candidates,
    and these product candidates could be subject to restrictions or
    withdrawal from the market following approval.
    The
    procedures and requirements for granting marketing approvals
    vary among countries, which may cause us to incur additional
    costs or delays or may prevent us from obtaining marketing
    approvals in different countries and regulatory
    jurisdictions.
   36




---



##### 



If we
    fail to obtain an adequate level of reimbursement for any
    approved products by third-party payers, there may be no
    commercially viable markets for these products or the markets
    may be much smaller than expected. The continuing efforts of the
    government, insurance companies, managed care organizations and
    other payers of health care costs to contain or reduce costs of
    healthcare may adversely affect our ability to generate revenues
    and achieve profitability, the future revenues and profitability
    of our potential customers, suppliers and collaborators, and the
    availability of capital.
        If
    physicians and patients do not accept the product candidates
    that we may develop, our ability to generate product revenue in
    the future will be adversely affected.
    
    ability to provide acceptable evidence of safety and efficacy;
    convenience and ease of administration;
    prevalence and severity of adverse side effects;
    the timing of market entry relative to competitive treatments; 37




---



##### 




    cost effectiveness;
    effectiveness of our marketing and pricing strategy for any
    product candidates that we may develop;
    publicity concerning our product candidates or competitive
    products;
    the strength of distribution support; and
    our ability to obtain third-party coverage or reimbursement.    We
    face the risk of product liability claims and may not be able to
    obtain insurance.
    Our
    operations involve hazardous materials and we must comply with
    environmental laws and regulations, which can be
    expensive.
    Risks
    Relating to Our Intellectual Property and Litigation
  We may
    not be able to obtain or maintain adequate patents and other
    intellectual property rights to protect our business and product
    candidates against competitors.
   38




---



##### 



We may
    incur substantial costs enforcing our patents against third
    parties. If we are unable to protect our intellectual property
    rights, our competitors may develop and market products with
    similar features that may reduce demand for our potential
    products.
     39




---



##### 



If we
    are not able to protect and control our unpatented trade
    secrets, know-how and other technological innovation, we may
    suffer competitive harm.
    If
    third parties claim that our product candidates or technologies
    infringe their intellectual property rights, we may become
    involved in expensive patent litigation, which could result in
    liability for damages or require us to stop our development and
    commercialization of our product candidates after they have been
    approved and launched in the market, or we could be forced to
    obtain a license and pay royalties under unfavorable
    terms.
         40




---



##### 



Our
    success depends on our ability to maintain and enforce our
    licensing arrangements with various third party
    licensors.
    If
    licensees or assignees of our intellectual property rights
    breach any of the agreements under which we have licensed or
    assigned our intellectual property to them, we could be deprived
    of important intellectual property rights and future
    revenue.
    We may
    be subject to damages resulting from claims that we or our
    employees have wrongfully used or disclosed alleged trade
    secrets of their former employers.
   41




---



##### 



Risks
    Relating to Manufacturing and Sales of Products
  We
    depend on our collaborators and third-party manufacturers to
    produce most, if not all, of our product candidates and if these
    third parties do not successfully manufacture these product
    candidates our business will be harmed.
  scale-up
    
    we and our collaborators may not be able to initiate or continue
    clinical trials of product candidates that are under development;
    we and our collaborators may be delayed in submitting
    applications for regulatory approvals for our product
    candidates; and
    we and our collaborators may not be able to meet commercial
    demands for any approved products.  We
    have no sales, marketing or distribution experience and will
    depend significantly on third parties who may not successfully
    sell our product candidates following approval.
   42




---



##### 




    we may not be able to attract and build an experienced marketing
    staff or sales force;
    the cost of establishing a marketing staff or sales force may
    not be justifiable in light of the revenues generated by any
    particular product; and
    our direct sales and marketing efforts may not be successful. Item 1B.  Unresolved
    Staff Comments    Item 2.
    Properties  5-year
  10-year
    Item 3.
    Legal
    Proceedings    Item 4.
    Submission
    of Matters to a Vote of Security Holders   PART II  Item 5.
    Market
    for Registrants Common Equity, Related Stockholder Matters
    and Issuer Purchases of Equity Securities  Market
    Information
   43




---



##### 



High


LowYear Ended December 31, 2006First Quarter

$
10.65


$
3.96Second Quarter

$
10.26


$
4.07Third Quarter

$
4.47


$
2.25Fourth Quarter

$
5.30


$
1.82Year Ended December 31, 2007First Quarter

$
4.75


$
2.31Second Quarter

$
3.74


$
2.26Third Quarter

$
2.95


$
1.80Fourth Quarter

$
2.21


$
1.22     Dividend
    Policy
    Item 6.
    Selected
    Consolidated Financial Data.    Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations.  The following discussion contains forward-looking statements,
    which involve risks, uncertainties, and assumptions. Our actual
    results and the timing of events could differ materially from
    those anticipated in these forward-looking statements as a
    result of various factors, including those set forth in
    Part I  Item 1A above under the caption
    Risk Factors. See Cautionary Note Regarding
    Forward-Looking Statements included elsewhere in this
    Annual Report on
    Form 10-K.
    This Managements Discussion and Analysis of Financial
    Condition and Results of Operations should be read in
    conjunction with our consolidated financial statements and
    related notes included elsewhere in this Annual Report on
    Form 10-K.
    Overview
  Merger
    of CancerVax Corporation and Micromet AG
   44




---



##### 



Ongoing
    Business Activities
         45




---



##### 



Research
    and Development and In-Process Research and
    Development
          agreed-upon
   46




---



##### 



Critical
    Accounting Policies and the Use of Estimates
  Form 10-K,
  Revenue
    Recognition
  Revenue Recognition
       47




---



##### 



No. 00-21, Revenue Arrangements with Multiple Deliverables. No. 00-21
  Purchase
    Price Allocation in Business Combinations
    Goodwill
  Goodwill and Other Intangible
    Assets
  Long-Lived
    and Intangible Assets
    Stock-Based
    Compensation
   48




---



##### 



Common
    Stock Warrants Liability
  EITF 00-19, Accounting for Derivative Financial Instruments Indexed
    To, and Potentially Settled In, a Companys Own
    Stock EITF 00-19
  Recent
    Accounting Standards and Pronouncements
    The Fair Value Option for Financial Assets and
    Financial Liabilities contract-by-contract
 49




---



##### 



EITF 07-3, Accounting for Nonrefundable Advance Payments for Goods
    or Services Received for Use in Future Research and Development
    Activities (EITF 07-3). EITF 07-3 EITF 07-3 EITF 07-3
  Noncontrolling Interests in Consolidated Financial
    Statements  an amendment of ARB No. 51
    EITF 07-1,
    Accounting for Collaborative Arrangement,
    (EITF 07-1) EITF 07-1 EITF 07-1
  Results
    of Operations
  Comparison
    of the Years Ended December 31, 2007 and December 31,
    2006
  Revenues.
  For the Year EndedDecember 31,


December 31,2007


2006Collaborative R&D revenue:Merck Serono

$
4.1


$
18.2MedImmune


6.0



5.3Nycomed


4.8



TRACON


2.2



Other


0.3



1.9Total collaborative R&D revenue


17.4



25.4License and other revenue


1.0



2.2Total revenues

$
18.4


$
27.6    50




---



##### 



20-year 15-year
  Research and Development Expenses. in vitro in vivo
    In-Process Research and Development.
  General and Administrative Expenses.
 51




---



##### 



Interest Expense.
  Change in Fair Value of Common Stock Warrants
    Liability.
  Other Income (Expense).
  Liquidity
    and Capital Resources
         52




---



##### 




    the number, scope, rate of progress, results and costs of our
    preclinical studies, clinical trials and other research and
    development activities;
    the terms and timing of any distribution, corporate
    collaborations that we may establish, and the success of these
    collaborations;
    the cost, timing and outcomes of regulatory approvals;
    the number and characteristics of product candidates that we
    pursue;
    the cost and timing of establishing manufacturing, marketing and
    sales, and distribution capabilities;
    the cost of establishing clinical and commercial supplies of our
    product candidates;
    the cost of preparing, filing, prosecuting, defending and
    enforcing any patent claims and other intellectual property
    rights; and
    the extent to which we acquire or invest in businesses, products
    or technologies, although we currently have no commitments or
    agreements relating to any of these types of transactions.   53




---



##### 



Contractual
    Obligations
    Payment Due by PeriodLess Than








More ThanContractual Obligations

Total


1 Year


1-3 Years


3-5 Years


5 YearsOperating leases

$
23,061


$
5,113


$
10,171


$
7,777


$
Long-term debt  MedImmune


2,254







2,254







Silent partnership obligations


2,401



2,401











Contractual payments under licensing and research and
    development agreements


367



130



87



60



90Capital leases


237



183



42



12



$
28,320


$
7,827


$
12,554


$
7,849


$
90   and/or
  Cautionary
    Note Regarding Forward-Looking Statements
   54




---



##### 



Item 7A.
    Quantitative
    and Qualitative Disclosures About Market Risk  Interest
    Rates
    Exchange
    Rates
      Item 8.
    Financial
    Statements and Supplementary Data    Item 9.
    Changes
    in and Disagreements With Accountants on Accounting and
    Financial Disclosures    Item 9A.
    Controls
    and Procedures  Evaluation
    of Disclosure Controls and Procedures
   55




---



##### 



Rules 13a-15(e) 15d-15(e)
    Form 10-K
  Managements
    Report on Internal Control Over Financial Reporting
        Regulation S-K
   56




---



##### 




    Inadequate Procedures Around Research and Development
    Accruals.  As a result of deficiencies identified
    in the operation of our transaction level controls designed to
    ensure the accuracy of our accrued expenses for our research and
    development expenses, we have determined that controls over such
    process were not effective. Given the significance of research
    and development costs and related accrued expenses to our
    consolidated financial statements, and the magnitude of the
    potential misstatement of expenses arising from the
    deficiencies, we have concluded that we continue to have a
    material weakness in our internal controls over the proper
    accrual of research and development expenses as of
    December 31, 2007.
    Insufficient resources.  We have insufficient
    accounting and finance personnel with the knowledge and
    experience required to properly apply and evaluate the
    accounting for new, significant
    and/or
    infrequent transactions and to ensure an appropriate level of
    review of financial statement accounts, increasing the risk of a
    financial statement misstatement. As a result, errors were
    identified by our independent registered public accounting firm
    that required adjustments to our consolidated financial
    statements impacting goodwill, accrued expenses, non-current
    liabilities and general and administrative expenses, subsequent
    to our financial statement review process but prior to filing of
    our
    Form 10-K.
    Accordingly, we have concluded that our controls over our
    financial statement closing and reporting process are not
    effective, and represent a material weakness.   57




---



##### 



Report of
    Independent Registered Public Accounting Firm
  
            
    Management has identified a material weakness in transaction
    level controls over the Companys process for determining
    accruals for research and development expenses.
    Management has identified a material weakness due to
    insufficient accounting and finance personnel with the knowledge
    and experience required to properly apply and evaluate the
    accounting for new, significant
    and/or
    infrequent transactions and to ensure an appropriate level of
    review of financial statement accounts, increasing the risk of a
    financial statement misstatement.         58




---



##### 



Managements
    Remediation Plan for 2008
      
    Hire a Chief Financial Officer with significant SEC reporting
    experience;
    Supplement and train our accounting staff to improve the breadth
    and depth of experience;
    Evaluate and implement additional procedures over the accrual
    process for our research and development expenses, including the
    performance of fluctuation analyses and comparison of actual
    expenses to budgeted amounts for each research and development
    program to identify unusual or unexpected results; and
    Implement a regular review of the consolidated financial
    statements focusing on the identification and evaluation of new,
    significant or unusual contracts, arrangements or transactions
    during the period and include an assessment of the important
    provisions of the arrangements for appropriateness of their
    accounting treatment and any necessary consultation with
    relevant specialists.    Changes
    in Internal Control over Financial Reporting
  Rules 13a-15(f) 15d-15(f)
  Item 9B.
    Other
    Information   PART III  Item 10.
    Directors,
    Executive Officers and Corporate Governance    Item 11.
    Executive
    Compensation   59




---



##### 



Item 12.
    Security
    Ownership of Certain Beneficial Owners and
    Management    Item 13.
    Certain
    Relationships and Related Transactions and Director
    Independence    Item 14.
    Principal
    Accountant Fees and Services   PART IV  Item 15.
    Exhibits,
    Financial Statement Schedules and Reports on
    Form 8-K  ExhibitNumber

Description3.1(2)

Amended and Restated Certificate of Incorporation of the
    Registrant3.2(10)

Certificate of Amendment of the Amended and Restated Certificate
    of Incorporation of the Registrant3.3(4)

Certificate of Designations for Series A Junior Participating
    Preferred Stock of the Registrant3.4(21)

Amended and Restated Bylaws effective October 3, 20074.1

Form of Specimen Common Stock Certificate4.2(1)

Warrant to Purchase Vendor Preferred Stock, Series 2, issued to
    Venture Lending & Leasing III, LLC, dated September 6, 20024.3(4)

Rights Agreement, by and between the Registrant and Mellon
    Investor Services LLC, which includes the form of Certificate of
    Designations of the Series A Junior Participating Preferred
    Stock of the Registrant as Exhibit A, the form of Right
    Certificate as Exhibit B and the Summary of Rights to Purchase
    Preferred Shares as Exhibit C, dated as of November 3, 20044.4(17)

First Amendment to Rights Agreement, by and between the
    Registrant and Mellon Investor Services LLC, dated as of March
    17, 20064.5(16)

Second Amended and Restated Note, in favor of MedImmune
    Ventures, Inc., dated as of December 27, 20064.6(13)

Common Stock Purchase Agreement, by and between the Registrant
    and Kingsbridge Capital Limited, dated as of August 30, 20064.7(13)

Registration Rights Agreement, by and between the Registrant and
    Kingsbridge Capital Limited, dated as of August 30, 20064.8(13)

Warrant to purchase 285,000 shares of Common Stock, issued
    to Kingsbridge Capital Limited, dated August 30, 20064.9(17)

Form of Warrant to Purchase Common Stock, dated May 5, 20064.10(11)

Securities Purchase Agreement, by and among the Registrant and
    funds affiliated with NGN Capital LLC, dated as of July 21, 20064.11(11)

Form of Warrants to purchase an aggregate of 555,556 shares
    of Common Stock, in favor of funds affiliated with NGN Capital,
    LLC, dated July 24, 20064.12(19)

Securities Purchase Agreement by and among the Company and the
    Investors listed therein, dated June 19, 20074.13(19)

Registration Rights Agreement by and among the Company and the
    Investors listed therein, dated June 19, 20074.14(19)

Warrant to Purchase Common Stock, dated June 19, 2007 60




---



##### 



ExhibitNumber

Description4.15(19)

Alternate Warrant to Purchase Common Stock, dated June 19, 20074.16(17)(&)

Silent Partnership Participation Agreement (Beteiligungsvertrag)
    with tbg Technologie Beteiligungsgesellschaft mbH, dated March
    2, 19994.17(17)(&)

Silent Partnership Participation Agreement (Beteiligungsvertrag)
    with tbg Technologie Beteiligungsgesellschaft mbH, dated March
    2, 19994.18(17)(&)

Amendment to Silent Partnership Participation Agreements with
    tbg Technologie Beteiligungsgesellschaft mbH, dated February 6,
    200610.1(17)(@)

Lease Agreement between Micromet AG and GEK
    Grundstücksverwaltungsgesellschaft mbH & Co. Objekt
    Eins KG, dated December 10, 2002, as amended10.2(1)

Standard Industrial/Commercial Single-Tenant Lease-Net, by and
    between the Registrant and Blackmore Airport Centre, dated
    August 31, 200110.3(9)

Sublease Agreement, by and between the Registrant and Genoptix,
    Inc., dated as of April 26, 200610.4(1)

Lease, by and between Spieker Properties, L.P. and John Wayne
    Cancer Institute, made as of July 22, 199910.5(1)

Agreement of Lease Assignment, by and between the Registrant and
    John Wayne Cancer Institute, dated as of August 4, 200010.6(1)

First Amendment to Lease, by and between the Registrant (as
    successor in interest to John Wayne Cancer Institute) and EOP --
    Marina Business Center, L.L.C. (as successor in interest to
    Spieker Properties, L.P.), entered into as of October 1, 200110.7(1)

Second Amendment to Lease, by and between the Registrant and
    EOP  Marina Business Center, L.L.C., entered into as
    of September 4, 200210.8(6)

Third Amendment to Lease, by and between the Registrant and
    CA-Marina Business Center Limited Partnership, entered into as
    of November 14, 200310.9(7)

Fourth Amendment to Lease, by and between the Registrant and
    Marina Business Center, LLC, entered into as of January 18, 200510.10(10)

Fifth Amendment to Lease, by and among the Registrant, Marina
    Business Center, LLC, and American Bioscience, Inc., dated as of
    April 18, 200610.11(8)

Assignment and Assumption of Lease, by and between the
    Registrant and American Bioscience, Inc., effective as of May 1,
    200610.12(14)(#)

Compensation Arrangement with David F. Hale10.13(15)(#)

Executive Employment Agreement, by and between the Registrant
    and Christian Itin, dated June 2, 200610.14(15)(#)

Executive Employment Agreement, by and between the Registrant
    and Matthias Alder, dated July 1, 200610.15(17)(#)

Executive Employment Agreement, by and between the Registrant
    and Carsten Reinhardt, dated June 2, 200610.16(17)(#)

Executive Employment Agreement, by and between the Registrant
    and Jens Hennecke, dated June 2, 200610.17(17)(#)

Executive Employment Agreement, by and between the Registrant
    and Patrick Baeuerle, dated June 2, 200610.18(22)(#)

Executive Employment Agreement, by and between the Registrant
    and Mark Reisenauer, dated August 16, 200710.19(#)

Separation Agreement with Christopher Schnittker, dated December
    10, 200710.20(17)(#)

2007 Management Incentive Compensation Plan10.21(17)(#)

Non-Employee Director Compensation Policy10.22(1)(#)

Third Amended and Restated 2000 Stock Incentive Plan10.23(1)(#)

2003 Employee Stock Purchase Plan10.24(5)(#)

Amended and Restated 2003 Equity Incentive Award Plan 61




---



##### 



ExhibitNumber

Description10.25(17)(#)

2006 Equity Incentive Award Plan10.26(1)(#)

Form of Indemnification Agreement entered into by the Registrant
    with its directors and executive officers10.27(17)(%)

Collaboration and License Agreement, by and between Micromet AG
    and Ares Trading S.A., dated as of December 3, 2004, as amended
    on November 30, 200610.28(17)(%)

Research and License Agreement, by and between Micromet AG and
    Biovation Limited, dated August 14, 2001, as amended on
    September 26, 2002 and June 16, 200410.29(17)(%)

Research Cross-License Agreement by and among Micromet AG, Enzon
    Pharmaceuticals, Inc. and Cambridge Antibody Technology Limited,
    dated September 3, 2003, as amended on March 17, 200510.30(17)(%)

Non-Exclusive Product License Agreement for MT201, by and
    between Micromet AG and Cambridge Antibody Technology Limited,
    dated September 3, 2003, as amended on March 17, 200510.31(17)(%)

Non-Exclusive Product License Agreement for MT203, by and
    between Micromet AG and Cambridge Antibody Technology Limited,
    dated September 3, 2003, as amended on March 17, 200510.32(17)(%)

Amended and Restated Cross-License Agreement, by and between
    Micromet AG and Enzon Pharmaceuticals, Inc., dated June 28,
    2004, as amended on March 17, 200510.33(17)(%)

GM-CSF License Agreement, by and between Micromet AG and Enzon
    Pharmaceuticals, Inc., dated November 21, 200510.34(17)(%)

BiTE Research Collaboration Agreement, by and between Micromet
    AG and MedImmune, Inc., dated June 6, 200310.35(17)(%)

Collaboration and License Agreement, by and between Micromet AG
    and MedImmune, Inc., dated June 6, 200310.36(3)(%)

Amended and Restated Collaboration Agreement, by and between
    Cell-Matrix, Inc., a wholly owned subsidiary of the Registrant,
    and Applied Molecular Evolution, dated as of October 15, 200410.37(12)(%)

First Amendment to Amended and Restated Collaboration Agreement,
    by and between Cell-Matrix, Inc., a wholly-owned subsidiary of
    the Registrant, and Applied Molecular Evolution, dated as of
    June 10, 200610.38(1)(%)

License Agreement, by and between the University of Southern
    California and Bio-Management, Inc., dated September 19, 199910.39(17)(%)

First Amendment to License Agreement, by and between the
    University of Southern California and Cell-Matrix, Inc., dated
    as of February 23, 200710.40(18)(%)

License Agreement dated March 14, 2007 by and between
    Cell-Matrix, Inc. and TRACON Pharmaceuticals, Inc.10.41(+)

Second Amendment to the Collaboration and License Agreement
    dated October 19, 2007 by and between Micromet AG and Merck
    Serono International SA10.42(20)(+)

Collaboration and License Agreement, dated May 24, 2007, by and
    between Micromet AG and Altana Pharma AG, a wholly-owned
    subsidiary of Nycomed A/S10.43(18)

Amendment No. 1 to Sublease Agreement dated April 24, 2007 by
    and between Micromet, Inc. and Genoptix, Inc.10.44(20)

Office Building Lease Agreement dated April 1, 2007 between
    Micromet, Inc. and Second Rock Spring Park Limited Partnership10.45(20)(&)

Sublease Agreement, dated June 15, 2007, by and between Micromet
    AG and Roche Diagnostics GmBH11.1

Computation of Per Share Earnings (included in the notes to the
    audited financial statements contained in this report)21.1

List of Subsidiaries23.1

Consent of Independent Registered Public Accounting Firm 62




---



##### 



ExhibitNumber

Description24.1

Powers of Attorney (included on signature page)31.1

Certification of Principal Executive Officer pursuant to Rules
    13a-14 and 15d-14 promulgated under the Securities Exchange Act
    of 193431.2

Certification of Principal Financial Officer pursuant to Rules
    13a-14 and 15d-14 promulgated under the Securities Exchange Act
    of 193432(*)

Certifications of Principal Executive Officer and Principal
    Financial Officer pursuant to 18 U.S.C. Section 1350, as
    adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
    2002     (1)
    
    Incorporated by reference to the Registrants Registration
    Statement on
    Form S-1
    filed with the Securities and Exchange Commission on
    October 24, 2003(2)
    
    Incorporated by reference to the Registrants Quarterly
    Report on
    Form 10-Q
    filed with the Securities and Exchange Commission on
    December 11, 2003(3)
    
    Incorporated by reference to the Registrants Current
    Report on
    Form 8-K
    filed with the Securities and Exchange Commission on
    October 21, 2004(4)
    
    Incorporated by reference to the Registrants Current
    Report on
    Form 8-K
    filed with the Securities and Exchange Commission on
    November 8, 2004(5)
    
    Incorporated by reference to the Registrants Registration
    Statement on
    Form S-8
    filed with the Securities and Exchange Commission on
    November 17, 2004(6)
    
    Incorporated by reference to the Registrants Current
    Report on
    Form 8-K
    filed with the Securities and Exchange Commission on
    December 29, 2004(7)
    
    Incorporated by reference to the Registrants Current
    Report on
    Form 8-K
    filed with the Securities and Exchange Commission on
    January 20, 2005(8)
    
    Incorporated by reference to the Registrants Current
    Report on
    Form 8-K
    filed with the Securities and Exchange Commission on
    April 20, 2006(9)
    
    Incorporated by reference to the Registrants Current
    Report on
    Form 8-K
    filed with the Securities and Exchange Commission on May 1,
    2006(10)
    
    Incorporated by reference to the Registrants Quarterly
    Report on
    Form 10-Q
    filed with the Securities and Exchange Commission on
    May 10, 2006(11)
    
    Incorporated by reference to the Registrants Current
    Report on
    Form 8-K
    filed with the Securities and Exchange Commission on
    July 26, 2006(12)
    
    Incorporated by reference to the Registrants Quarterly
    Report on
    Form 10-Q
    filed with the Securities and Exchange Commission on
    August 8, 2006(13)
    
    Incorporated by reference to the Registrants Current
    Report on
    Form 8-K
    filed with the Securities and Exchange Commission on
    August 31, 2006(14)
    
    Incorporated by reference to the Registrants Current
    Report on
    Form 8-K
    filed with the Securities and Exchange Commission on
    October 6, 2006(15)
    
    Incorporated by reference to the Registrants Quarterly
    Report on
    Form 10-Q
    filed with the Securities and Exchange Commission on
    November 9, 2006(16)
    
    Incorporated by reference to the Registrants Current
    Report on
    Form 8-K
    filed with the Securities and Exchange Commission on
    January 4, 2007(17)
    
    Incorporated by reference to the Registrants Quarterly
    Report on
    Form 10-K
    filed with the Securities and Exchange Commission on
    March 16, 2007(18)
    
    Incorporated by reference to the Registrants Quarterly
    Report on
    Form 10-Q
    filed with the Securities and Exchange Commission on
    May 10, 2007 63




---



##### 



(19)
    
    Incorporated by reference to the Registrants Current
    Report on
    Form 8-K
    filed with the Securities and Exchange Commission on
    June 21, 2007(20)
    
    Incorporated by reference to the Registrants Current
    Report on
    Form 10-Q
    filed with the Securities and Exchange Commission on
    August 9, 2007(21)
    
    Incorporated by reference to the Registrants Current
    Report on
    Form 8-K
    filed with the Securities and Exchange Commission on
    October 9, 2007(22)
    
    Incorporated by reference to the Registrants Quarterly
    Report on
    Form 10-Q
    filed with the Securities and Exchange Commission on
    November 8, 2007&
    
    Indicates that the exhibit is an English translation of a
    foreign language document@
    
    Indicates that the exhibit is an English summary of a foreign
    language document#
    
    Indicates management contract or compensatory plan%
    
    The Registrant has been granted confidential treatment with
    respect to certain portions of this exhibit (indicated by
    asterisks), which have been filed separately with the Securities
    and Exchange Commission+
    
    Portions of this exhibit (indicated by asterisks) have been
    omitted pursuant to a request for confidential treatment and
    have been separately filed with the Securities and Exchange
    Commission*
    
    These certifications are being furnished solely to accompany
    this annual report pursuant to 18 U.S.C. Section 1350,
    and are not being filed for purposes of Section 18 of the
    Securities Exchange Act of 1934 and are not to be incorporated
    by reference into any filing of the Registrant, whether made
    before or after the date hereof, regardless of any general
    incorporation language in such filing 64




---



##### 



SIGNATURES      By:
    /s/  CHRISTIAN
    ITIN   President and Chief Executive Officer
 (Principal Executive Officer)
  By:
    /s/  DONALD
    A. ZELM   Executive Director of Finance
 Acting Chief Financial Officer
 (Principal Financial Officer)
    POWER OF
    ATTORNEY
  Form 10-K,
    Name

Title

Date/s/  CHRISTIAN
    ITINChristian
    Itin

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

March 14, 2008/s/  DONALD
    A. ZELMDonald
    A. Zelm

Executive Director of Finance
    Acting Chief Financial Officer(Principal Financial and Accounting Officer)

March 14, 2008/s/  DAVID
    F. HALEDavid
    F. Hale

DirectorChairman of the Board of Directors

March 14, 2008/s/  JERRY
    C. BENJAMINJerry
    C. Benjamin

Director

March 14, 2008/s/  JOHN
    E. BERRIMANJohn
    E. Berriman

Director

March 14, 2008 65




---



##### 



Name

Title

Date/s/  MICHAEL
    G. CARTERMichael
    G. Carter

Director

March 14, 2008/s/  PETER
    JOHANNPeter
    Johann

Director

March 14, 2008/s/  BARCLAY
    A. PHILLIPSBarclay
    A. Phillips

Director

March 14, 2008/s/  JOSEPH
    P. SLATTERYJoseph
    P. Slattery

Director

March 14, 2008/s/  OTELLO
    STAMPACCHIAOtello
    Stampacchia

Director

March 14, 2008  66




---



##### 



MICROMET,
    INC.
  INDEX TO
    CONSOLIDATED FINANCIAL STATEMENTS
  PageReport of Independent Registered Public Accounting Firm


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


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


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


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


F-6Notes to Consolidated Financial Statements


F-7  F-1




---



##### 



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM                F-2




---



##### 



MICROMET,
    INC.
  CONSOLIDATED BALANCE SHEETS
  December 31,


December 31,2007


2006(In thousands, except par value)ASSETSCurrent assets:Cash and cash equivalents

$
27,066


$
24,301Accounts receivable


4,689



2,319Prepaid expenses and other current assets


2,579



2,048Total current assets


34,334



28,668Property and equipment, net


4,390



3,357Loans to employees






78Goodwill


6,462



6,917Patents, net


7,680



8,850Other long-term assets


196



243Restricted cash


3,190



3,059Total assets

$
56,252


$
51,172LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable

$
2,334


$
1,680Accrued expenses


4,765



10,153Common stock warrants liability


5,219



Other liabilities


520



366Short-term note






1,320Current portion of long-term debt obligations


2,401



599Current portion of deferred revenue


3,360



2,972Total current liabilities


18,599



17,090Deferred revenue, net of current portion


8,366



195Other non-current liabilities


2,055



1,961Long-term debt obligations, net of current portion


2,254



7,408Stockholders equity:Preferred stock, $0.00004 par value; 10,000 shares
    authorized; no shares issued and outstanding






Common stock, $0.00004 par value; 150,000 shares
    authorized; 40,778 and 31,419 shares issued and outstanding
    at December 31, 2007 and December 31, 2006,
    respectively


2



1Additional paid-in capital


184,014



163,482Stock subscription receivables






(27
)Accumulated other comprehensive income


5,895



5,869Accumulated deficit


(164,933
)


(144,807
)Total stockholders equity


24,978



24,518Total liabilities and stockholders equity

$
56,252


$
51,172    F-3




---



##### 



MICROMET,
    INC.
  CONSOLIDATED STATEMENTS OF OPERATIONS
  Years Ended December 31,2007


2006(In thousands, except per share amounts)Revenues:Collaboration agreements

$
17,366


$
25,449License fees and other


1,018



2,134Total revenues


18,384



27,583Operating expenses:Research and development


29,191



28,252In-process research and development






20,890General and administrative


14,430



12,012Total operating expenses


43,621



61,154Loss from operations


(25,237
)


(33,571
)Other income (expense):Interest expense


(509
)


(1,725
)Interest income


938



743Change in fair value of common stock warrants liability


1,750



Other income (expense), net


2,932



561Net loss

$
(20,126
)

$
(33,992
)Basic and diluted net loss per common share

$
(0.55
)

$
(1.29
)Weighted average shares used to compute basic and diluted net
    loss per share


36,362



26,366    F-4




---



##### 



MICROMET,
    INC.
  CONSOLIDATED STATEMENTS OF STOCKHOLDERS
    EQUITY (DEFICIT)
  Stock





AccumulatedAdditional


Subscription


Stock


Other





TotalCommon Stock


Paid-in


from


Subscription


Comprehensive


Accumulated


StockholdersShares


Amount


Capital


Conversion


Receivables


Income


Deficit


Equity (Deficit)(In thousands)Balance at January 1, 2006


17,915


$
1


$
67,181


$
23,108


$
(242
)

$
6,234


$
(110,815
)

$
(14,533
)Payments received for stock subscription receivable


















215











215Issuance of shares in connection with conversion of convertible
    notes


1,847







36,572



(23,108
)














13,464Investor capital contribution per investor agreement










4,796



















4,796Issuance of shares in connection with merger with CancerVax
    Corporation


9,381







41,740



















41,740Issuance of shares in connection with private placement, net of
    offering costs of $714


2,222







7,286



















7,286Exercise of stock options


18







84



















84Issuance of shares in connection with employee severance payment
    from merger with CancerVax


22







145



















145Issuance of shares in connection with compensation for board of
    director fees


14







72



















72Stock based compensation expense










5,606



















5,606Comprehensive loss:Net loss


























(33,992
)


(33,992
)Foreign currency translation adjustment






















(403
)






(403
)Realized gain on short-term investments






















38







38Total comprehensive loss






























(34,357
)Balance at December 31, 2006


31,419


$
1


$
163,482


$



$
(27
)

$
5,869


$
(144,807
)

$
24,518Payments received for stock subscription receivable


















27











27Issuance of shares in connection with private placement, net of
    offering costs of $1,895


9,217



1



16,504



















16,505Exercise of stock options


54







90



















90Issuance of shares in connection with employee severance payment


83







250



















250Issuance of shares in connection with compensation for board of
    director fees


5







14



















14Stock based compensation expense










3,674



















3,674Comprehensive loss:Net loss


























(20,126
)


(20,126
)Foreign currency translation adjustment






















26







26Total comprehensive loss






























(20,100
)Balance at December 31, 2007


40,778


$
2


$
184,014


$



$



$
5,895


$
(164,933
)

$
24,978    F-5




---



##### 



MICROMET,
    INC.
  CONSOLIDATED STATEMENTS OF CASH FLOWS
  Years Ended December 31,2007


2006(In thousands)Cash flows from operating activities:Net loss

$
(20,126
)

$
(33,992
)Adjustments to reconcile net loss to net cash used in operating
    activities:Depreciation and amortization


3,192



3,068In-process research and development






20,890Non-cash interest on long-term obligations


564



517Net gain on debt restructuring


(270
)


(842
)Change in fair value of common stock warrants liability


(1,750
)


Stock-based compensation expense


3,688



5,678Net loss on disposal of property and equipment


1



15Changes in operating assets and liabilities:Accounts receivable


(2,136
)


506Prepaid expenses and other current assets


(149
)


(617
)Accounts payable, accrued expenses and other liabilities


(4,938
)


(7,154
)Deferred revenue


7,651



(3,423
)Net cash used in operating activities


(14,273
)


(15,354
)Cash flows from investing activities:Proceeds from disposals of property and equipment






135Proceeds for loans to related parties


67



226Purchases of property and equipment


(1,265
)


(618
)Restricted cash used as collateral


(48
)


(70
)Cash acquired in connection with merger, net of costs paid






37,401Net cash (used in) provided by investing activities


(1,246
)


37,074Cash flows from financing activities:Proceeds from issuance of common stock and common stock
    warrants,net of costs paid


23,474



7,286Proceeds from capital contributions from stockholders






4,796Proceeds from exercise of stock options


90



84Proceeds from stock subscription receivable


27



215Principal payments on long-term debt obligations


(4,277
)


(21,129
)Principal payments on short-term notes payable


(1,313
)


(1,290
)Principal payments on capital lease obligations


(156
)


(66
)Net cash provided by (used in) financing activities


17,845



(10,104
)Effect of exchange rate changes on cash and cash equivalents


439



1,271Net increase in cash and cash equivalents


2,765



12,887Cash and cash equivalents at beginning of period


24,301



11,414Cash and cash equivalents at end of period

$
27,066


$
24,301Supplemental disclosure of cash flow information:Cash paid for interest

$
2,160


$
2,302Supplemental disclosure of non-cash investing and financing
    activities:Fair value of warrants granted in 2007 private placement

$
6,969


$
Issuance of warrants in connection with equity tranaction

$



$
1,918Issuance of shares in lieu of cash compensation

$
264


$
Acquisitions of equipment purchased through capital leases

$
294


$
64Conversion of convertible notes payable

$



$
13,464    F-6




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  Note 1.
    Business
    Overview    Note 2.
    Basis of
    Presentation            1-for-3
 F-7




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Note 3.
    Summary
    of Significant Accounting Policies  Cash
    and Cash Equivalents
    Restricted
    Cash
        Allowance
    for Doubtful Accounts
    Property
    and Equipment
    Purchase
    Price Allocation for Business Combinations
   F-8




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Goodwill
  Goodwill and Other
    Intangible Assets
  Patents
    Impairment
    of Long-Lived and Identifiable Intangible Assets
  Accounting for the Impairment or Disposal of Long-Lived
    Assets
  Common
    Stock Warrants Liability
    Foreign
    Currency Translation
     F-9




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Revenue
    Recognition
  Revenue Recognition
        No. 00-21, Revenue Arrangements with Multiple Deliverables No. 00-21
  Research
    and Development
   F-10




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Accumulated
    Other Comprehensive Income
    Realized and


AccumulatedForeign


Unrealized


OtherCurrency


Gains (Losses) on


ComprehensiveTranslation


Investments


IncomeBalance January 1, 2006

$
6,272


$
(38
)

$
6,234Net increase(decrease)


(403
)


38



(365
)Balance December 31, 2006


5,869







5,869Net increase


26







26Balance December 31, 2007

$
5,895






$
5,895   Stock-Based
    Compensation
  Adoption
    of Statement of Financial Accounting Standards No. 123(R)
    (SFAS 123(R)):
    Transition Election Related
    to Accounting for Tax Effects of Share-Based Payment
    Awards
    Stock-Based
    Compensation for Issuances to Non-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
  Income
    Taxes
  Accounting for Income Taxes
 F-11




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Net
    Loss Per Share
  Earnings Per Share
  Reclassifications
    Recent
    Accounting Standards and Pronouncements
  Fair Value Measurements
  The
    Fair Value Option for Financial Assets and Financial Liabilities contract-by-contract
  EITF 07-3, Accounting for Nonrefundable Advance Payments for Goods or
    Services Received for Use in Future Research and Development
    Activities (EITF 07-3). EITF 07-3 EITF 07-3 EITF 07-3
  Noncontrolling Interests in Consolidated Financial
    Statements  an amendment of ARB No. 51
 F-12




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Business Combinations (SFAS 141(R))
  EITF 07-1,
    Accounting for Collaborative Arrangement,
    (EITF 07-1) EITF 07-1 EITF 07-1
  Note 4.
    Merger
    with CancerVax        Fair value of CancerVax common stock

$
41,030Estimated fair value of CancerVax stock options and stock
    warrants assumed


710Estimated transaction costs incurred by Micromet


2,257Total purchase price

$
43,997    F-13




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Cash and cash equivalents

$
39,645Receivables under collaborations


447Restricted cash


2,280Other assets


569Accounts payable


(2,639
)Accrued expenses


(5,764
)Current portion of long-term debt obligations


(16,816
)Long-term liabilities


(1,532
)Net book value of acquired assets and liabilities


16,190In-process research and development


20,890Goodwill


6,917Total purchase price

$
43,997         Pro
    Forma Results of Operations
   F-14




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    December 31, 2006(In thousands, except pershare amounts)Revenues

$
28,305Net Loss

$
(45,399
)Basic and diluted net loss per common share

$
(1.53
)     Note 5.
    Property
    and Equipment    Estimated


December 31,Useful Life


2007


2006Laboratory equipment


5 years


$
7,435


$
6,359Computer equipment and software


3 years



2,055



1,716Furniture


10 years



916



701Leasehold improvements


10 years



4,820



3,18715,226



11,963Less: accumulated depreciation and amortization






(10,836
)


(8,606
)Property and equipment, net





$
4,390


$
3,357     Note 6.
    Patents    December 31,2007


2006Patents

$
21,941


$
19,667Less: accumulated amortization


(14,261
)


(10,817
)Patents, net

$
7,680


$
8,850    F-15




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    2008

$
2,1942009


2,1942010


2,1942011


1,098$
7,680   Note 7.
    Accrued
    Expenses    December 31,2007


2006Accrued employee benefits

$
2,083


$
1,527Accrued taxes






1,677Accrued research and development expenses


1,596



2,501Accrued severance obligations


151



1,029Accrued license agreement fees






1,700Accrued facility lease exit liability, assumed in merger,
    current portion


156



481Other accrued liabilities and expenses


779



1,238$
4,765


$
10,153   Note 8.
    Income
    Taxes  Accounting for Uncertainty in
    Income Taxes  An Interpretation of FASB Statement
    No. 109
    and/or and/or
   F-16




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        December 31,2007


2006Deferred tax assetsNet operating loss carry forwards  Germany

$
50,831


$
55,267Net operating loss carry forwards  United States
    federal & state


31,084



27,809Prepaid expenses and other current assets


133



156Patents and other intangibles


1,031



3,116Property and equipment, net


7,576



6,581Stock-based compensation


2,026



1,833Accrued expenses and other liabilities


1,034



889Other non-current liabilities


9



194Other


55



66State tax credits


3,152



3,152Deferred tax liabilitiesDeferred revenue


(4,243
)


(6,500
)92,688



92,563Valuation allowance


(92,688
)


(92,563
)Net deferred tax assets

$



$
        F-17




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Note 9.
    Deferred
    Revenue    December 31,2007


2006Nycomed

$
7,205


$
TRACON


1,421



Merck Serono


2,722



2,959Other


378



208Subtotal


11,726



3,167Current portion


(3,360
)


(2,972
)Long term portion

$
8,366


$
195       Note 10.
    Other
    Non-Current Liabilities    December 31,2007


2006Facility lease exit liability, assumed in merger with CancerVax,
    net of current portion

$
1,381


$
989Restructuring provision, net of current portion






417GEK subsidy, net of current portion


198



227Asset retirement obligation


415



271Capital lease obligations, net of current portion (see
    Note 12)


47



57Other


14



$
2,055


$
1,961   Facility
    Lease Exit Liability and Restructuring Provision
   F-18




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          Accrued














AccruedBalance as of


Amounts





Adjustment


Currency


Balance as ofDecember 31,


Paid


Accretion


to the


Translation


December 31,2006


in Period


Expense


Liability


Adjustment


2007Former CancerVax facilities

$
1,470


$
(691
)

$
453


$
305






$
1,537Munich, Germany facility


472



(130
)


41



(394
)


11



Total

$
1,942


$
(821
)

$
494


$
(89
)

$
11


$
1,537     GEK
    Subsidy
   F-19




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Asset
    Retirement Obligation
    2007


2006Beginning balance January 1,

$
271


$
205Additional asset retirement obligation


50



Accretion expense


55



40Currency translation adjustment


39



26Ending balance December 31,

$
415


$
271   Note 11.
    Long-Term
    Debt    December 31,2007


2006TBG borrowings due December 31, 2008; interest payable
    semi-annually at rates ranging from 6% to 7%

$
2,401


$
2,015Bayern Kapital borrowings due December 31, 2006; interest
    payable quarterly at 6.75%






586TBFB borrowings repaid in August, 2007; interest payable
    quarterly at 6%






3,386MedImmune borrowings due June 6, 2010; unsecured with
    interest payable monthly at 4.5%


2,254



2,020Total long-term debt obligations


4,655



8,007Less: current portion


(2,401
)


(599
)Long-term debt obligations, net of current portion

$
2,254


$
7,408     2008

$
2,4012009


2010


2,254Total

$
4,655  F-20




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Silent
    Partnership Agreements
  start-up
    Amendments
    to the Silent Partnership Agreements
          Grundstücksentwicklungs-
    und Verwaltungsgesellschaft mbH & Co KG
   F-21




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Silicon
    Valley Bank Loan and Security Agreement
    Note 12.
    Commitments
    and Contingencies  Leases
        Capital
    Lease Obligations
   F-22




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    NetCapital


Operating


Sublease


OperatingLeases


Leases


Income


Leases2008

$
183


$
5,113


$
(2,459
)

$
2,6542009


35



5,053



(2,498
)


2,5552010


7



5,118



(2,052
)


3,0662011


7



5,193



(1,414
)


3,7792012


5



2,584



(717
)


1,867Thereafter














Total minimum lease payments


237


$
23,061


$
(9,140
)

$
13,921Less: amount representing imputed interest


19Present value of minimum lease payments


218Less: current portion


171Capital lease obligation, less current portion

$
47     License
    and Research and Development Agreements
          2008

$
1302009


572010


302011


302012


30Thereafter


90Total minimum payments

$
367  F-23




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Other
    Taxes
      Note 13.
    Stockholders
    Equity (Deficit)  Committed
    Equity Financing Facility
      Form S-3
  Private
    Placements of Common Stock
   F-24




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      EITF 00-19, Accounting for Derivative Financial Instruments Indexed
    To, and Potentially Settled In, a Companys Own Stock 00-19) , EITF 00-19
      EITF 00-19-2, Accounting for Registration Payment
    Arrangements.
   F-25




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Conversion
    of MedImmune Convertible Notes
    Conversion
    of Enzon Convertible Note
    Conversion
    of 2004 Convertible Notes
    Additional
    Issuances of Warrants to Purchase Common Stock
      Stock
    Subscription Receivable
    Note 14.
    Stock
    Option and Employee Stock Purchase Plans  2000
    and 2002 Stock Option Plans
   F-26




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    2000
    and 2003 Stock Option Plans Assumed from CancerVax in
    Merger
      2006
    Stock Option Plan
   F-27




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Stock
    Option Plan Activity:
  2003
    and 2006 Option Plans
    Number of


Weighted AverageOptions


Exercise PriceOutstanding at January 1, 2006






Granted


2,812


$
3.16Exercised


(18
)

$
4.40Assumed in merger


1,384


$
13.13Expired


(592
)

$
16.13Outstanding at December 31, 2006


3,586


$
4.38Granted


3,183


$
2.58Exercised


(54
)

$
1.66Forfeited


(367
)

$
2.85Expired


(299
)

$
7.23Outstanding at December 31, 2007


6,049


$
3.41       Options Outstanding


Options ExercisableWeighted








WeightedAverage


Weighted





Average


WeightedRemaining


Average





Remaining


AverageNumber


Contractual


Exercise


Number


Contractual


ExerciseRange of Exercise Prices

Outstanding


Life


Price


Exercisable


Life


Price(Thousands)


(Years)





(Thousands)


(Years)$1.66 - $1.66


1,660



6.95


$
1.66



1,545






$
1.66$1.77 - $2.38


732



9.63


$
2.07



82






$
2.33$2.56 - $2.56


1,229



9.41


$
2.56



208






$
2.56$2.60 - $2.75


379



7.80


$
2.64



126






$
2.61$2.93 - $2.93


950



8.67


$
2.93



400






$
2.93$3.23 - $6.63


737



7.64


$
4.86



424






$
4.80$8.46 - $9.90


252



5.96


$
9.34



238






$
9.42$19.80 - $36.00


110



6.38


$
31.49



110






$
31.49$1.66 - $36.00


6,049



8.13


$
3.41



3,133



7.13


$
4.00Aggregate intrinsic value

$
711,900










$
618,300    F-28




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Stock-Based
    Compensation:
      Years Ended December 31,2007


2006Research and development

$
1,562


$
2,573General and administrative


2,083



2,033$
3,645


$
4,606     Years Ended December 31,2007

2006Expected volatility 2006 Plan

N/A

80.0%Expected volatility 2003 Plan

74.1% to 76.7%

78.2% to 80.0%Risk-free interest rate 2006 Plan

N/A

5.0%Risk-free interest rate 2003 Plan

3.9% to 4.8%

4.6% to 5.0%Dividend yield 2006 and 2003 Plans

0%

0%Expected term 2006 Plan

N/A

5.2 yearsExpected term 2003 Plan

5.3 to 6.1 years

5.8 to 6.1 years   at-the-money Share-Based Payment stock-based
 F-29




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  EITF 96-18, Accounting for Equity Instruments That Are Issued to Other
    Than Employees for Acquiring or in Conjunction with Selling
    Goods or Services
    Employee
    Stock Purchase Plan
    Note 15.
    Related
    Parties  Loans
    to Related Parties
    Compensation
    Arrangement
    Note 16.
    Financial
    Risk Management Objectives and Policies    Foreign
    Currency Risk
   F-30




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Credit
    and Liquidity Risk
          December 31,2007


2006Merck Serono


22
%


66
%MedImmune, Inc.


32
%


19
%Nycomed


26
%


Tracon


12
%


     Fair
    Value of Financial Instruments
       F-31




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    December 31, 2007


December 31, 2006Carrying


Fair


Carrying


FairAmount


Value


Amount


ValueCuris, Inc. promissory note

$



$



$
1,320


$
1,154MedImmune, Inc. promissory note due June 6, 2010


2,254



1,723



2,020



1,545Bayern Kapital (silent partner) borrowings due December 31,
    2006










586



585TBG (silent partner) borrowings due December 31, 2008


2,401



2,275



2,015



2,168TBFB (silent partner) borrowings repaid in August 2007










3,386



3,629Warrants granted in 2007 Private Placement


5,219



5,219







$
9,874


$
9,217


$
9,327


$
9,081   Note 17.
    License
    Agreements and Collaborations    Agreements
    Relevant for the Generation of Antibodies and for the
    BiTE®
    Antibody Platform in General
  Purchase
    Agreement with Curis
    License
    Agreement with Enzon
     F-32




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      License
    Agreement with Cambridge Antibody Technology Limited and
    Enzon
        Licensing
    of Single-Chain Antibody Patents
  Exclusive
    IP Marketing Agreement with Enzon
      License
    Agreements with Various Parties pursuant to the Exclusive IP
    Marketing Agreement
   F-33




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Agreements
    Relevant for Adecatumumab
  License
    Agreement with Cambridge Antibody Technology Limited
    License,
    Development, Manufacturing and Supply Agreement with CIMAB and
    YM BioSciences
    Note 18.
    Research
    and Development Agreements    Merck
    Serono
    co-development
 F-34




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          Enzon
      MedImmune
    MT103
    Collaboration and License Agreement
   F-35




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      BiTE
    Research Collaboration Agreement
      Nycomed
      TRACON
   F-36




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Rentschler
    Biotechnologie
        Bayer
    HealthCare
      Other
    Licensing and Research and Development Agreements
   F-37




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Note 19.
    Legal
    Proceedings  Cell
    Therapeutics/Novuspharma
      Curis
    Patent
    Opposition in Europe
    Other
    Matters
    Note 20.
    Segment
    Disclosures   F-38




---



##### 



MICROMET,
    INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Revenues:
    2007


2006United States

$
8,678


$
5,762Germany


4,936



Switzerland


4,282



20,271All others


488



1,550$
18,384


$
27,583   Long-lived
    Assets:
    Note 21.
    Quarterly
    Financial Data (unaudited)    Year Ended December 31, 2007First


Second


Third


FourthQuarter


Quarter


Quarter


QuarterTotal revenues

$
2,770


$
3,066


$
5,563


$
6,985Total operating expenses


10,272



11,084



9,204



13,061Loss from operations


(7,502
)


(8,018
)


(3,641
)


(6,076
)Net loss attributable to common stockholders


(7,590
)


(6,469
)


(2,268
)


(3,799
)Basic and diluted net loss per common share


(0.24
)


(0.20
)


(0.06
)


(0.09
)   Year Ended December 31, 2006First


Second


Third


FourthQuarter


Quarter


Quarter


QuarterTotal
    revenues(1)

$
4,123


$
5,017


$
4,636


$
13,807Total operating
    expenses(2)


5,736



34,386



10,152



10,880Income (loss) from operations


(1,613
)


(29,369
)


(5,516
)


2,927Net income (loss)


(2,166
)


(29,455
)


(5,766
)


3,395Basic net income (loss) per common share


(0.12
)


(1.18
)


(0.19
)


0.11Diluted net income (loss) per common share


(0.12
)


(1.18
)


(0.19
)


0.11     (1)
    
    Included in revenues in the 4th quarter of 2006 is the receipt
    of a Merck Serono milestone payment of $10.0 million under
    our collaboration agreement.(2)
    
    Included in total operating expenses in the 2nd quarter of 2006
    is a write-off of in-process research and development of
    $20.9 million, which was recorded as an expense immediately
    upon completion of the merger. F-39