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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q

(Mark One)

|     |  |                                                                                         
|---- |  | ----------------------------------------------------------------------------------------
|[X]  |  | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 
|     |  | For the quarterly period ended September 30, 2003                                       
|     |  | OR                                                                                      
|[  ] |  | TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|     |  | For the transition period from
____________to____________.                              

Commission File Number 0-23317

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GENE LOGIC INC.(Exact name of registrant as specified in its charter)

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|                                |  |                    
|------------------------------- |  | -------------------
|Delaware                        |  | 06-1411336         
|(State or other jurisdiction of |  | (I.R.S. Employer   
|incorporation or organization)  |  | Identification No.)

|                                                
|------------------------------------------------
|610 Professional Drive                          
|Gaithersburg, Maryland 20879                    
|(Address of principal executive offices)        
|(301) 987-1700                                  
|(Registrants phone number, including area code)
|                                                

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days: YES x NO  ̈

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act). YES x NO  ̈

The number of shares outstanding of the Registrants Common Stock, $.01
par value, was 31,127,323 as of October 31, 2003.



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GENE LOGIC INC.

TABLE OF CONTENTS

|                                                                                                      |  |                       |  |   
|----------------------------------------------------------------------------------------------------- |  | --------------------- |  | --
|PART I                                                                                                |  | FINANCIAL INFORMATION |  |   
|Item 1.  
Financial Statements                                                                        |  |                      
|                                                                                                      |  |                       |  |   
|Consolidated Balance Sheets at September 30, 2003 and December 31, 2002                               |  | 3                    
|Consolidated Statements of Operations for the Three and Nine Months
Ended September 30, 2003 and 2002 |  | 4                    
|Consolidated Statements of Cash Flows for the Nine Months Ended
September 30, 2003 and 2002           |  | 5                    
|Notes to Consolidated Financial Statements                                                            |  | 6                    
|                                                                                                      |  |                       |  |   
|Item 2.  Managements Discussion and Analysis of Results of Operations and Financial Condition        |  | 12                   
|                                                                                                      |  |                       |  |   
|Item 3.  
Quantitative and Qualitative Disclosure About Market Risk                                   |  | 17                   
|                                                                                                      |  |                       |  |   
|Item 4.  
Controls and Procedures                                                                     |  | 17                   
|                                                                                                      |  |                       |  |   
|PART II                                                                                               |  | OTHER INFORMATION     |  |   
|                                                                                                      |  |                       |  |   
|Item 1.  
Legal Proceedings                                                                           |  | 18                   
|                                                                                                      |  |                       |  |   
|Item 2.  
Changes in Securities and Use of Proceeds                                                   |  | 18                   
|                                                                                                      |  |                       |  |   
|Item 3.  
Defaults Upon Senior Securities                                                             |  | 18                   
|                                                                                                      |  |                       |  |   
|Item 4.  
Submission of Matters to a Vote of Security Holders                                         |  | 18                   
|                                                                                                      |  |                       |  |   
|Item 5.  
Other Information                                                                           |  | 18                   
|                                                                                                      |  |                       |  |   
|Item 6.  
Exhibits and Reports on Form 8-K                                                            |  | 18                   
|                                                                                                      |  |                       |  |   
|Signatures                                                                                            |  |                       |  | 19

2.



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PART I                      FINANCIAL INFORMATION
Item 1. Financial Statements

GENE LOGIC INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)

|                                                  |                                                      |                                                                                                                                                                                  |                                            |                                      |          |               |        |              |          |         |        | 
|------------------------------------------------- | ---------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------ | ------------------------------------ | -------- | ------------- | ------ | ------------ | -------- | ------- | ------ | 
|                                                  |                                                      |                                                                                                                                                                                  |                                            |                                      |          | September 30, |        | December 31,
|                                                  |                                                      |                                                                                                                                                                                  |                                            |                                      |          | 2003          |        | 2002        
|                                                  |                                                      |                                                                                                                                                                                  |                                            |                                      |          |               |        |             
|                                                  |                                                      |                                                                                                                                                                                  |                                            |                                      |          | (Unaudited)   |        |              |          |        
|                                                  |                                                      |                                                                                                                                                                                  |                                            | ASSETS                               |          |               |        |              |          |         |        | 
|Current assets:                                   |                                                      |                                                                                                                                                                                  |                                            |                                      |          |               |        |             
|                                                  | Cash and cash equivalents                            |                                                                                                                                                                                  | $                                          | 71,040                               |          |               | $      | 106,957      |         
|                                                  | Marketable securities available-for-sale             |                                                                                                                                                                                  |                                            | 43,111                               |          |               |        | 60,145       |         
|                                                  | Accounts receivable, net of allowance of $30 in 2003 |                                                                                                                                                                                  |                                            | 8,816                                |          |               |        | 4,793        |         
|                                                  | Unbilled services                                    |                                                                                                                                                                                  |                                            | 3,098                                |          |               |        |             |         
|                                                  | Inventory, net                                       |                                                                                                                                                                                  |                                            | 4,784                                |          |               |        | 8,936        |         
|                                                  | Prepaid expenses                                     |                                                                                                                                                                                  |                                            | 2,307                                |          |               |        | 1,610        |         
|                                                  | Other current assets                                 |                                                                                                                                                                                  |                                            | 869                                  |          |               |        | 1,117        |         
|                                                  |                                                      |                                                                                                                                                                                  |                                            |                                      |          |               |        |              |         
|                                                  |                                                      |                                                                                                                                                                                  | Total current assets                       |                                      |          | 134,025       |        |              |          | 183,558 |       
|Property and equipment, net                       |                                                      |                                                                                                                                                                                  | 22,354                                     |                                      |          |               | 14,770 |             
|Long-term investments                             |                                                      |                                                                                                                                                                                  | 1,000                                      |                                      |          |               | 5,268  |             
|Notes receivable from employees                   |                                                      |                                                                                                                                                                                  | 51                                         |                                      |          |               | 50     |             
|Goodwill                                          |                                                      |                                                                                                                                                                                  | 45,707                                     |                                      |          |               | 2,677  |             
|Intangibles, net                                  |                                                      |                                                                                                                                                                                  | 21,454                                     |                                      |          |               | 21,094 |             
|Other assets                                      |                                                      |                                                                                                                                                                                  | 75                                         |                                      |          |               | 43     |             
|                                                  |                                                      |                                                                                                                                                                                  |                                            |                                      |          |               |        |              |         
|                                                  |                                                      |                                                                                                                                                                                  | Total assets                               |                                      | $        | 224,666       |        |              | $        | 227,460 |       
|                                                  |                                                      |                                                                                                                                                                                  |                                            |                                      |          |               |        |              |         
|                                                  |                                                      |                                                                                                                                                                                  |                                            | LIABILITIES AND STOCKHOLDERS EQUITY |          |               |        |              |          |         |        | 
|Current liabilities:                              |                                                      |                                                                                                                                                                                  |                                            |                                      |          |               |        |             
|                                                  | Accounts payable                                     |                                                                                                                                                                                  | $                                          | 5,719                                |          |               | $      | 8,225        |         
|                                                  | Accrued expenses                                     |                                                                                                                                                                                  |                                            | 4,768                                |          |               |        | 5,187        |         
|                                                  | Current portion of capital lease obligations         |                                                                                                                                                                                  |                                            | 121                                  |          |               |        |             |         
|                                                  | Current portion of long-term debt                    |                                                                                                                                                                                  |                                            | 42                                   |          |               |        | 40           |         
|                                                  | Deferred revenue                                     |                                                                                                                                                                                  |                                            | 6,323                                |          |               |        | 6,425        |         
|                                                  |                                                      |                                                                                                                                                                                  |                                            |                                      |          |               |        |              |         
|                                                  |                                                      |                                                                                                                                                                                  |                                            | Total current liabilities            |          |               | 16,973 |              |          |         | 19,877 | 
|Deferred revenue                                  |                                                      |                                                                                                                                                                                  | 610                                        |                                      |          |               | 1,363  |             
|Capital lease obligations, net of current portion |                                                      |                                                                                                                                                                                  | 372                                        |                                      |          |               |       |             
|Long-term debt, net of current portion            |                                                      |                                                                                                                                                                                  | 679                                        |                                      |          |               | 710    |             
|Other noncurrent liabilities                      |                                                      |                                                                                                                                                                                  | 1,566                                      |                                      |          |               | 1,072  |             
|                                                  |                                                      |                                                                                                                                                                                  |                                            |                                      |          |               |        |              |         
|                                                  |                                                      |                                                                                                                                                                                  |                                            | Total liabilities                    |          |               | 20,200 |              |          |         | 23,022 | 
|                                                  |                                                      |                                                                                                                                                                                  |                                            |                                      |          |               |        |              |         
|Commitments and contingencies                     |                                                      |                                                                                                                                                                                  |                                           |                                      |          |               |       |             
|Stockholders equity:                             |                                                      |                                                                                                                                                                                  |                                            |                                      |          |               |        |             
|                                                  |                                                      | Preferred stock, $.01 par value; 10,000,000 shares authorized; no
shares issued and outstanding as of September 30, 2003 and
December 31, 2002                                   |                                            |                                      |         |               |        |              |         |        
|                                                  |                                                      | Common stock, $.01 par value; 60,000,000 shares authorized; 31,123,823
and 27,056,487 shares issued and outstanding as of September 30, 2003
and December 31, 2002, respectively |                                            |                                      | 311      |               |        |              | 271      |        
|                                                  |                                                      | Additional paid-in capital                                                                                                                                                       |                                            |                                      | 383,347  |               |        |              | 363,294  |        
|                                                  |                                                      | Accumulated other comprehensive income                                                                                                                                           |                                            |                                      | 65       |               |        |              | 248      |        
|                                                  |                                                      | Accumulated deficit                                                                                                                                                              |                                            |                                      | (179,257 | )             |        |              | (159,375 | )      
|                                                  |                                                      |                                                                                                                                                                                  |                                            |                                      |          |               |        |              |         
|                                                  |                                                      |                                                                                                                                                                                  | Total stockholders equity                 |                                      |          | 204,466       |        |              |          | 204,438 |       
|                                                  |                                                      |                                                                                                                                                                                  |                                            |                                      |          |               |        |              |         
|                                                  |                                                      |                                                                                                                                                                                  | Total liabilities and stockholders equity |                                      | $        | 224,666       |        |              | $        | 227,460 |       
|                                                  |                                                      |                                                                                                                                                                                  |                                            |                                      |          |               |        |              |         

See accompanying notes.

3.



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GENE LOGIC INC.

CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(Unaudited)

|                                                              |                                     |                                    |        |                    |         |                   |        |        |        |      |        |        |         |   |        |        |         |  
|------------------------------------------------------------- | ----------------------------------- | ---------------------------------- | ------ | ------------------ | ------- | ----------------- | ------ | ------ | ------ | ---- | ------ | ------ | ------- | - | ------ | ------ | ------- | -
|                                                              |                                     |                                    |        | Three Months Ended |         | Nine Months Ended
|                                                              |                                     |                                    |        | September 30,      |         | September 30,    
|                                                              |                                     |                                    |        |                    |         |                  
|                                                              |                                     |                                    |        | 2003               |         | 2002              |        | 2003   |        | 2002
|                                                              |                                     |                                    |        |                    |         |                   |        |        |        |     
|Revenue:                                                      |                                     |                                    |        |                    |         |                   |        |        |        |      |        |        |         |   |        |       
|                                                              | Information services revenue        |                                    | $      | 12,260             |         |                   | $      | 14,185 |        |      | $      | 38,073 |         |   | $      | 40,093 |        
|                                                              | Contract study services revenue     |                                    |        | 5,450              |         |                   |        |       |        |      |        | 11,793 |         |   |        |       |        
|                                                              |                                     |                                    |        |                    |         |                   |        |        |        |      |        |        |         |   |        |        |        
|                                                              |                                     | Total revenue                      |        |                    | 17,710  |                   |        |        | 14,185 |      |        |        | 49,866  |   |        |        | 40,093  |  
|Expenses:                                                     |                                     |                                    |        |                    |         |                   |        |        |        |      |        |        |         |   |        |       
|                                                              | Cost of contract study services     |                                    |        | 4,741              |         |                   |        |       |        |      |        | 9,797  |         |   |        |       |        
|                                                              | Database production                 |                                    |        | 12,360             |         |                   |        | 16,609 |        |      |        | 38,039 |         |   |        | 43,602 |        
|                                                              | Research and development            |                                    |        | 540                |         |                   |        | 641    |        |      |        | 1,601  |         |   |        | 2,056  |        
|                                                              | Selling, general and administrative |                                    |        | 5,675              |         |                   |        | 4,269  |        |      |        | 16,039 |         |   |        | 14,972 |        
|                                                              |                                     |                                    |        |                    |         |                   |        |        |        |      |        |        |         |   |        |        |        
|                                                              |                                     | Total expenses                     |        |                    | 23,316  |                   |        |        | 21,519 |      |        |        | 65,476  |   |        |        | 60,630  |  
|                                                              |                                     |                                    |        |                    |         |                   |        |        |        |      |        |        |         |   |        |        |        
|                                                              |                                     | Loss from operations               |        |                    | (5,606  | )                 |        |        | (7,334 | )    |        |        | (15,610 | ) |        |        | (20,537 | )
|Interest (income), net                                        |                                     |                                    | (327   | )                  |         |                   | (786   | )      |        |      | (1,640 | )      |         |   | (2,410 | )     
|Other (income) expense                                        |                                     |                                    |       |                    |         |                   |       |        |        |      |       |        |         |   | (250   | )     
|Write-down of equity investment                               |                                     |                                    | 4,268  |                    |         |                   |       |        |        |      | 4,268  |        |         |   |       |       
|                                                              |                                     |                                    |        |                    |         |                   |        |        |        |      |        |        |         |   |        |        |        
|                                                              |                                     | Net loss before income tax expense |        |                    | (9,547  | )                 |        |        | (6,548 | )    |        |        | (18,238 | ) |        |        | (17,877 | )
|Income tax expense                                            |                                     |                                    | 564    |                    |         |                   | 409    |        |        |      | 1,644  |        |         |   | 993    |       
|                                                              |                                     |                                    |        |                    |         |                   |        |        |        |      |        |        |         |   |        |        |        
|                                                              |                                     | Net loss                           |        | $                  | (10,111 | )                 |        | $      | (6,957 | )    |        | $      | (19,882 | ) |        | $      | (18,870 | )
|                                                              |                                     |                                    |        |                    |         |                   |        |        |        |      |        |        |         |   |        |        |        
|Basic and diluted net loss per share                          |                                     | $                                  | (0.33  | )                  |         | $                 | (0.26  | )      |        | $    | (0.67  | )      |         | $ | (0.70  | )     
|                                                              |                                     |                                    |        |                    |         |                   |        |        |        |      |        |        |         |   |        |        |        
|Shares used in computing basic and
diluted net loss per share |                                     |                                    | 31,104 |                    |         |                   | 26,992 |        |        |      | 29,770 |        |         |   | 26,914 |       
|                                                              |                                     |                                    |        |                    |         |                   |        |        |        |      |        |        |         |   |        |        |        

See accompanying notes.

4.



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GENE LOGIC INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(Unaudited)

|                                                                               |                                                                             |                                          |         |                   |         |      |         |        |         |  
|------------------------------------------------------------------------------ | --------------------------------------------------------------------------- | ---------------------------------------- | ------- | ----------------- | ------- | ---- | ------- | ------ | ------- | -
|                                                                               |                                                                             |                                          |         | Nine Months Ended
|                                                                               |                                                                             |                                          |         | September 30,    
|                                                                               |                                                                             |                                          |         |                  
|                                                                               |                                                                             |                                          |         | 2003              |         | 2002
|                                                                               |                                                                             |                                          |         |                   |         |     
|Cash flows from operating activities:                                          |                                                                             |                                          |         |                   |         |      |         |       
|Net loss                                                                       |                                                                             | $                                        | (19,882 | )                 |         | $    | (18,870 | )     
|Adjustments to reconcile net loss to net cash flows from operating activities: |                                                                             |                                          |         |                   |         |      |         |       
|                                                                               | Depreciation and amortization                                               |                                          |         | 12,408            |         |      |         | 9,996  |        
|                                                                               | Loss on abandonment of patent costs                                         |                                          |         | 157               |         |      |         | 667    |        
|                                                                               | Loss of disposal of property and equipment                                  |                                          |         | 56                |         |      |         | 12     |        
|                                                                               | Gain from the sale of equity investment                                     |                                          |         |                  |         |      |         | (250   | )      
|                                                                               | Write-down of equity investment                                             |                                          |         | 4,268             |         |      |         |       |        
|Changes in operating assets and liabilities (net of effects of acquisition):   |                                                                             |                                          |         |                   |         |      |         |       
|                                                                               | Accounts receivable and unbilled services, net                              |                                          |         | (1,140            | )       |      |         | (1,969 | )      
|                                                                               | Inventory, net                                                              |                                          |         | 4,153             |         |      |         | (462   | )      
|                                                                               | Prepaid expenses                                                            |                                          |         | (111              | )       |      |         | 145    |        
|                                                                               | Other assets                                                                |                                          |         | 232               |         |      |         | 2,641  |        
|                                                                               | Accounts payable                                                            |                                          |         | (5,998            | )       |      |         | (2,506 | )      
|                                                                               | Accrued expenses and other noncurrent liabilities                           |                                          |         | (942              | )       |      |         | (984   | )      
|                                                                               | Deferred revenue                                                            |                                          |         | (3,229            | )       |      |         | (5,825 | )      
|                                                                               |                                                                             |                                          |         |                   |         |      |         |       
|                                                                               |                                                                             | Net cash flows from operating activities |         |                   | (10,028 | )    |         |        | (17,405 | )
|                                                                               |                                                                             |                                          |         |                   |         |      |         |       
|Cash flows from investing activities:                                          |                                                                             |                                          |         |                   |         |      |         |       
|                                                                               | Purchases of property and equipment                                         |                                          |         | (1,058            | )       |      |         | (1,674 | )      
|                                                                               | Purchases of licenses and patent costs                                      |                                          |         | (607              | )       |      |         | (1,415 | )      
|                                                                               | Software development costs                                                  |                                          |         | (5,267            | )       |      |         | (5,366 | )      
|                                                                               | Database upgrade costs                                                      |                                          |         |                  |         |      |         | (3,886 | )      
|                                                                               | Sale of equity investment                                                   |                                          |         |                  |         |      |         | 1,240  |        
|                                                                               | Repayments of notes receivable from employees                               |                                          |         | 37                |         |      |         | 43     |        
|                                                                               | Cash paid to acquire TherImmune Research Corporation, net of cash acquired  |                                          |         | (30,433           | )       |      |         |       |        
|                                                                               | Purchase of marketable securities available-for-sale                        |                                          |         | (111,389          | )       |      |         |       |        
|                                                                               | Proceeds from sale and maturity of marketable securities available-for-sale |                                          |         | 128,240           |         |      |         | 69,528 |        
|                                                                               |                                                                             |                                          |         |                   |         |      |         |       
|                                                                               |                                                                             | Net cash flows from investing activities |         |                   | (20,477 | )    |         |        | 58,470  |  
|                                                                               |                                                                             |                                          |         |                   |         |      |         |       
|Cash flows from financing activities:                                          |                                                                             |                                          |         |                   |         |      |         |       
|                                                                               | Proceeds from issuance of common stock                                      |                                          |         | 694               |         |      |         | 2,116  |        
|                                                                               | Cash used to repay TherImmune debt                                          |                                          |         | (6,017            | )       |      |         |       |        
|                                                                               | Proceeds from note payable                                                  |                                          |         |                  |         |      |         | 450    |        
|                                                                               | Repayments of capital lease obligations and equipment loans                 |                                          |         | (89               | )       |      |         | (28    | )      
|                                                                               |                                                                             |                                          |         |                   |         |      |         |       
|                                                                               |                                                                             | Net cash flows from financing activities |         |                   | (5,412  | )    |         |        | 2,538   |  
|                                                                               |                                                                             |                                          |         |                   |         |      |         |       
|Net (decrease) increase in cash and cash equivalents                           |                                                                             |                                          | (35,917 | )                 |         |      | 43,603  |       
|Cash and cash equivalents, beginning of period                                 |                                                                             |                                          | 106,957 |                   |         |      | 128,273 |       
|                                                                               |                                                                             |                                          |         |                   |         |      |         |       
|Cash and cash equivalents, end of period                                       |                                                                             | $                                        | 71,040  |                   |         | $    | 171,876 |       
|                                                                               |                                                                             |                                          |         |                   |         |      |         |       
|Supplemental disclosure:                                                       |                                                                             |                                          |         |                   |         |      |         |       
|                                                                               | Taxes paid                                                                  |                                          | $       | 1,596             |         |      | $       | 1,006  |        
|                                                                               |                                                                             |                                          |         |                   |         |      |         |       
|                                                                               | Interest paid                                                               |                                          | $       | 34                |         |      | $       | 12     |        
|                                                                               |                                                                             |                                          |         |                   |         |      |         |       
|Non-cash transactions:                                                         |                                                                             |                                          |         |                   |         |      |         |       
|                                                                               | Issuance of common stock in TherImmune acquisition                          |                                          | $       | 19,400            |         |      | $       |       |        
|                                                                               |                                                                             |                                          |         |                   |         |      |         |       
|                                                                               | Equity investment received as partial payment for GeneExpress subscription  |                                          | $       |                  |         |      | $       | 1,000  |        
|                                                                               |                                                                             |                                          |         |                   |         |      |         |       

See accompanying notes.

5.



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##### 



GENE LOGIC INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2003
(in thousands, except share and per share data)
(Unaudited)

Note 1  Organization and Basis of Presentation

Description of Business

Gene Logic Inc. and its wholly owned subsidiary (collectively the
Company) is a leading drug development services company providing a wide
range of discovery and development services to pharmaceutical and biotechnology
companies worldwide, as well as U.S. Government entities. The Companys
services are organized into two business segments: information services and
contract study services. The information services business is based on the
Companys gene expression reference database, the GeneExpress System, for
research related to drug discovery and optimization. The contract study
services business consists of services related to drug development, including
preclinical safety and pharmacology studies, as well as analytical laboratory
and Phase I clinical trial services.

Basis of Presentation and Principles of Consolidation

On April 1, 2003, TherImmune Research Corporation was merged into Gene
Logics wholly owned subsidiary, GLA II Corp. Concurrently, GLA II Corp., the
surviving corporation, was renamed TherImmune Research Corporation
(TherImmune). The acquisition of TherImmune has been accounted for under the
purchase method of accounting, and consolidated financial statements herein
reflect the inclusion of TherImmunes operating results since the acquisition
date. All material intercompany accounts and transactions have been eliminated
in consolidation.

The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-Q and Article 10 of Regulation
S-X. The balance sheet as of September 30, 2003, statements of operations for
the three and nine months ended September 30, 2003 and 2002 and the statements
of cash flows for the nine months ended September 30, 2003 and 2002 are
unaudited, but include all adjustments (consisting of normal recurring
adjustments) which the Company considers necessary for a fair presentation of
the financial position, operating results and cash flows for the periods
presented. Although the Company believes that the disclosures in these
financial statements are adequate to make the information presented not
misleading, certain information and footnote information normally included in
financial statements prepared in accordance with accounting principles
generally accepted in the United States have been condensed or omitted pursuant
to the rules and regulations of the Securities and Exchange Commission.

Results for any interim period are not necessarily indicative of results
for any future interim period or for the entire year. The accompanying
unaudited financial statements should be read in conjunction with the audited
financial statements and notes thereto included in the Companys Annual Report
on Form 10-K for the year ended December 31, 2002 and, with respect to
TherImmune, the Companys Form 8-K filing on June 2, 2003.

Use of Estimates

The preparation of consolidated financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets and liabilities
at the date of the consolidated financial statements and the reported amounts
of revenue and expenses during the reporting period. Actual results could
differ from those estimates.

6.



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##### 



Note 2  Summary of Significant Accounting Policies

Inventory

Inventory is stated at the lower of cost or market. Cost for microarrays
and laboratory reagents is determined using the first-in, first-out method;
cost for tissue samples is determined using the average cost basis method. All
inventory is reviewed for impairment and appropriate reserves are recorded. At
September 30, 2003 and December 31, 2002, all inventory was classified as raw
materials.

|                              |  |                    |       |                   |  |   |       |  
|----------------------------- |  | ------------------ | ----- | ----------------- |  | - | ----- | -
|                              |  | September 30, 2003 |       | December 31, 2002
|                              |  |                    |       |                  
|Microarrays                   |  | $                  | 640   |                   |  | $ | 3,695 |  
|Laboratory reagents           |  |                    | 1,023 |                   |  |   | 803   |  
|Tissue samples                |  |                    | 4,036 |                   |  |   | 5,018 |  
|                              |  |                    |       |                   |  |   |       |  
|                              |  |                    | 5,699 |                   |  |   | 9,516 |  
|Less  tissue sample reserves |  |                    | (915  | )                 |  |   | (580  | )
|                              |  |                    |       |                   |  |   |       |  
|Inventory, net                |  | $                  | 4,784 |                   |  | $ | 8,936 |  
|                              |  |                    |       |                   |  |   |       |  

Comprehensive Loss

The Company accounts for comprehensive loss as prescribed by Statement of
Financial Accounting Standards No. 130, Reporting Comprehensive Income.
Comprehensive income (loss) is the total net income (loss) plus all changes in
equity during the period except those changes resulting from investment by
owners and distributions to owners. Total comprehensive loss, which included
unrealized gains or losses on the Companys marketable securities
available-for-sale, was $10,074 and $6,957 for the three months ended September
30, 2003 and 2002, respectively, and $20,065 and $18,887 for the nine months
ended September 30, 2003 and 2002, respectively.

Revenue Recognition

Information services revenue consists primarily of subscription fees
earned under subscription agreements for all or parts of the Companys gene
expression reference database, the GeneExpress System. Information derived
from the GeneExpress System is used for research related to drug discovery and
optimization by pharmaceutical and biotechnology companies. Each of the
subscription agreements with our GeneExpress System customers is for a specific
term, typically, over a multi-year period. In general, the Companys revenue
recognition for information services agreements is consistent with the
Companys performance under such agreements and revenue is recognized over the
period during which the customer has access. Such agreements provide for
termination in the event of a breach of the agreement by either party or a
bankruptcy or insolvency of either party. Revenue, based on subscription fees
received under such agreements, is recorded ratably over the term of the
related GeneExpress System subscription agreement. Certain subscription
agreements include a right of early termination (which, in some instances, is
subject to conditions) by the customer, without penalty, on a specified date
prior to the normal expiration of the term. If an agreement has a right of
early termination, revenue is recognized ratably over the subscription term up
to the possible date of early termination, based on subscription fees earned
under the agreement through the possible date of early termination. In the
absence of early termination, the balance of the subscription fees earned under
the agreement is recognized as revenue ratably over the remaining term of the
agreement.

Contract study services revenue is derived from cost-plus and fixed-fee
contracts with pharmaceutical and biotechnology companies, as well as U.S.
Government entities. Revenue is recognized on cost-plus contracts on the basis
of the direct costs incurred plus indirect costs and an allocable portion of
the fee earned. Revenue is recognized on fixed-fee contracts as services are
performed, based primarily upon the percentage of hours worked (including
subcontractor hours) compared to the total estimated hours for the contract.
The Company believes that hours worked is the best measure of proportional
performance under fixed-fee contracts. Billings under government contracts are
based on provisional billing rates which permit recovery of fringe benefits,
overhead and general and administrative expenses not exceeding certain limits.
These indirect expense rates are subject to review by the government on an
annual basis. When the final determination of the allowable rates for any year
has been made, billings may be adjusted accordingly. Cost and profit estimates
are reviewed periodically as the work progresses, and adjustments, if needed,
are reflected in the period in which the estimates are revised. Provisions for
estimated losses on uncompleted contracts are made in the period in which such
losses are determined. Unbilled services are recorded for revenue recognized
to date that has not been billed to the customer pursuant to the contractual
terms. In general, amounts become billable upon the achievement of milestones
or in accordance with predetermined payment schedules. Unearned revenue is
recorded for cash received from customers for whom services have not yet been
performed as of the balance sheet date.

Stock Option Plans

At September 30, 2003, the Company has two stock-based employee
compensation plans. The Company accounts for these plans under the recognition
and measurement principles of Accounting Principles Board Opinion No. 25,
Accounting for Stock Issued to Employees (APB 25), and related
interpretations. Under APB 25, compensation expense is recorded over the
vesting period only to the extent that the fair value of the underlying stock
on the date of grant exceeds the exercise or acquisition price of the stock or
stock-

7.



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##### 



based award. Stock options granted under the Companys 1997 Equity
Incentive Plan are granted with an exercise price equal to the fair value on
the grant date; stock issued under the Employee Stock Purchase Plan is
purchased at 85% of the lesser of either the fair value of the shares at the
time of purchase or the fair value at the employees eligibility date.

During the year ended December 31, 2002, the Company initiated a tender
offer for outstanding stock options held by employees of the Company. Under
the terms of the tender offer, eligible employees could tender stock options
that were granted with an exercise price equal to or greater than $11.00 per
share, subject to additional requirements for any stock option granted after
May 4, 2002. Once tendered and accepted, the old stock options were cancelled
and each employee who tendered stock options was entitled, subject to meeting
certain conditions, to receive new stock options for 80% of the number of
shares available under the cancelled stock options at the fair value on the
date of the grant. One of the conditions to receiving the new stock options
was that the individual was required to be employed by the Company on the date
of grant. Of the eligible stock options, 2,290,207 stock options were tendered
and cancelled, and on June 13, 2003, the Company granted new options for
1,794,847 shares with an exercise price of $7.21, the fair value on the date of
grant.

The following table illustrates the effect on net loss and loss per share
as if the Company had applied the fair value recognition provisions of
Statement of Financial Accounting Standards No. 123, Accounting for
Stock-Based Compensation (SFAS 123), to stock-based employee compensation:

|                                                                                                          |             |   |                    |       |                   |   |         |       |      |   |         |       |   |   |         |       |  
|--------------------------------------------------------------------------------------------------------- | ----------- | - | ------------------ | ----- | ----------------- | - | ------- | ----- | ---- | - | ------- | ----- | - | - | ------- | ----- | -
|                                                                                                          |             |   | Three months ended |       | Nine months ended
|                                                                                                          |             |   | September 30,      |       | September 30,    
|                                                                                                          |             |   |                    |       |                  
|                                                                                                          |             |   | 2003               |       | 2002              |   | 2003    |       | 2002
|                                                                                                          |             |   |                    |       |                   |   |         |       |     
|Net loss, as reported                                                                                     |             | $ | (10,111            | )     |                   | $ | (6,957  | )     |      | $ | (19,882 | )     |   | $ | (18,870 | )    
|Deduct: Stock-based employee
compensation expense determined
under fair value based method for
all awards |             |   | (905               | )     |                   |   | (3,585  | )     |      |   | (7,532  | )     |   |   | (12,276 | )    
|                                                                                                          |             |   |                    |       |                   |   |         |       |      |   |         |       |   |   |         |      
|Pro forma net loss                                                                                        |             | $ | (11,016            | )     |                   | $ | (10,542 | )     |      | $ | (27,414 | )     |   | $ | (31,146 | )    
|                                                                                                          |             |   |                    |       |                   |   |         |       |      |   |         |       |   |   |         |      
|Basic and diluted net loss per share:                                                                     |             |   |                    |       |                   |   |         |       |      |   |         |       |   |   |         |      
|                                                                                                          | As reported |   | $                  | (0.33 | )                 |   | $       | (0.26 | )    |   | $       | (0.67 | ) |   | $       | (0.70 | )
|                                                                                                          | Pro forma   |   | $                  | (0.35 | )                 |   | $       | (0.39 | )    |   | $       | (0.92 | ) |   | $       | (1.16 | )

Reclassifications

Certain reclassifications have been made to the prior years financial
statements to conform to the current year presentation.

New Accounting Pronouncements

The Emerging Issues Task Force Issue No. 00-21, Accounting for Revenue
Arrangement with Multiple Deliverables (Issue No. 00-21), addresses
circumstances involving the delivery or performance of multiple products,
services, and/or rights to use assets, and for which performance may occur at
different points in time or over different periods of time. The issue also
addresses whether the different revenue-generating activities, or deliverables,
are sufficiently separable, and there exists sufficient evidence of their fair
values to separately account for some or all of the deliverables. The issue
applies to all contractual arrangements under which a vendor will perform
multiple revenue-generating activities. Issue No. 00-21 is effective for all
revenue arrangements entered into in fiscal periods beginning after June 15,
2003, with early adoption permitted. The Company adopted this guidance
prospectively for all revenue arrangements entered into after January 1, 2003,
and the impact of adoption was not material to the Companys results of
operations.

In January 2003, the Financial Accounting Standards Board issued
Interpretation No. 46, Consolidation of Variable Interest Entities
(Interpretation No. 46). The objective of Interpretation No. 46 is to
improve financial reporting by companies involved with variable interest
entities. The Interpretation requires variable interest entities to be
consolidated by a company if that company is subject to a majority of the risk
of loss from the variable interest entitys activities or is entitled to
receive a majority of the entitys residual returns or both. Interpretation
No. 46 is effective immediately for arrangements entered into or modified after
January 31, 2003 and will be applied to all arrangements entered into or
modified before February 1, 2003 during the quarter ending December 31, 2003.
The initial adoption of Interpretation No. 46 for arrangements entered into or
modified after January 31, 2003 did not have any impact on the Companys
financial position or results of operations. The Company is still evaluating
the impact of Interpretation No. 46 for all arrangements entered into prior to
February 1, 2003; however, the Company does not anticipate that the impact of
these arrangements will have a material effect on the Companys financial
position or results of operations.

In May 2003, the Financial Accounting Standards Board issued Statement No.
150, Accounting for Certain Financial Instruments with Characteristics of Both
Liabilities and Equity (Statement No. 150). Statement No. 150 established
standards for how an issuer classifies and measures certain financial
instruments with characteristics of both liabilities and equity. Statement No.
150 is effective for financial instruments entered into or modified after May
31, 2003, and otherwise is effective at the beginning of the first interim
period beginning after June 15, 2003. The Company adopted Statement No. 150 on
July 1, 2003, with no effect on the Companys financial position or

8.



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##### 



results of operations.

Note 3  Acquisition of TherImmune Research Corporation

On February 25, 2003, the Company announced an agreement to acquire
TherImmune, a privately held contract study services company, in order for the
Company to: 1) create a more sizeable drug discovery and development services
entity with expanded service capabilities; 2) realize potential synergies from
the combination of the Companys information services business and TherImmunes
contract study services business; and 3) enhance the Companys revenue growth
and accelerate the time to profitability.

On April 1, 2003, the Company acquired by merger 100% of the outstanding
common stock of TherImmune for a total purchase price of $51,081, which
consisted of cash paid of $30,405 to TherImmune securityholders, 3,927,214
shares of Gene Logic Common Stock, valued at $19,400, issued to TherImmune
stockholders, and approximately $1,275 in transaction costs. The value of the
shares issued was based on the average market price of the Companys Common
Stock surrounding the measurement date. Approximately 5% of the total
consideration is being held in escrow at least through October 1, 2004 to
satisfy potential indemnification obligations of the TherImmune
securityholders.

The acquisition was recorded using the purchase method of accounting. The
total purchase price was allocated as follows:

|                                                        |  |   |         |  
|------------------------------------------------------- |  | - | ------- | -
|Current assets                                          |  | $ | 8,103   |  
|Property and equipment                                  |  |   | 11,130  |  
|Customer Relationships (estimated useful life, 2 years) |  |   | 2,500   |  
|Liabilities assumed                                     |  |   | (13,682 | )
|Goodwill                                                |  |   | 43,030  |  
|                                                        |  |   |         |  
|                                                        |  | $ | (51,081 | )
|                                                        |  |   |         |  

The following unaudited pro forma financial information gives effect to
Gene Logics acquisition by merger of TherImmune as if the transaction had
occurred at the beginning of each period presented and is based on the
historical statements of Gene Logic and TherImmune during such periods,
adjusted to give effect to the merger.

|                                     |  |                     |         |                     |  |      |        |      |  |   |         |   |  |   |         |  
|------------------------------------ |  | ------------------- | ------- | ------------------- |  | ---- | ------ | ---- |  | - | ------- | - |  | - | ------- | -
|                                     |  | Three Months        |         | Nine Months        
|                                     |  | Ended September 30, |         | Ended September 30,
|                                     |  |                     |         |                    
|                                     |  | 2003                |         | 2002                |  | 2003 |        | 2002
|                                     |  |                     |         |                     |  |      |        |     
|Total revenue                        |  | $                   | 17,710  |                     |  | $    | 20,216 |      |  | $ | 55,565  |   |  | $ | 57,436  |  
|Net loss                             |  |                     | (10,111 | )                   |  |      | (6,952 | )    |  |   | (21,191 | ) |  |   | (19,505 | )
|Basic and diluted net loss per share |  | $                   | (0.33   | )                   |  | $    | (0.22  | )    |  | $ | (0.68   | ) |  | $ | (0.63   | )
|Weighted average shares outstanding  |  |                     | 31,104  |                     |  |      | 30,919 |      |  |   | 31,065  |   |  |   | 30,841  |  

The pro forma adjustments used herein are based upon available information
and various assumptions that management believes are reasonable. These
adjustments give effect to events directly attributable to the transaction and
do not reflect any integration costs or other synergies that management expects
to realize as a result of the transaction. Such unaudited pro forma financial
information is not necessarily indicative of what the actual consolidated
results of the operations might have been had the acquisition been effective at
the beginning of each period presented.

Note 4  Segment Information

On April 1, 2003, the Company began managing its business as two business
segments: information services and contract study services. Prior to this
date, the Company operated as one business segment, information services.
Information services is based on the Companys gene expression reference
database, the GeneExpress System, for research related to drug discovery and
optimization. Contract study services consists of services related to drug
development including, preclinical safety and pharmacology studies, as well as
analytical laboratory and Phase I clinical trial services.

9.



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##### 



The following table presents the results of operations by segment used by
management to evaluate performance. Information services segment operating
income (loss) is determined by revenue for this segment less database
production and research and development expenses. Contract study services
segment operating income (loss) is determined by revenue for this segment less
costs related to contract studies. The Company does not identify or allocate,
nor does management evaluate, selling, general and administrative expenses and
assets by business segment. Amortization and depreciation is allocated by
business segment as identified below.

|                                                                                                         |                                              |                                 |    |                     |       |                     |        |        |   |      |     |         |       |  |        |         |   | 
|-------------------------------------------------------------------------------------------------------- | -------------------------------------------- | ------------------------------- | -- | ------------------- | ----- | ------------------- | ------ | ------ | - | ---- | --- | ------- | ----- |  | ------ | ------- | - | 
|                                                                                                         |                                              |                                 |    | Three Months        |       | Nine Months        
|                                                                                                         |                                              |                                 |    | Ended September 30, |       | Ended September 30,
|                                                                                                         |                                              |                                 |    |                     |       |                    
|                                                                                                         |                                              |                                 |    | 2003                |       | 2002                |        | 2003   |   | 2002
|                                                                                                         |                                              |                                 |    |                     |       |                     |        |        |   |     
|Information Services                                                                                     |                                              |                                 |    |                     |       |                     |        |        |   |      |     |         |       |  |        |        
|                                                                                                         | Revenue                                      |                                 | $  | 12,260              |       |                     | $      | 14,185 |   |      | $   | 38,073  |       |  | $      | 40,093  |  
|                                                                                                         | Operating loss (1)                           |                                 |    | (640                | )     |                     |        | (3,065 | ) |      |     | (1,567  | )     |  |        | (5,565  | )
|Contract Study Services                                                                                  |                                              |                                 |    |                     |       |                     |        |        |   |      |     |         |       |  |        |        
|                                                                                                         | Revenue                                      |                                 | $  | 5,450               |       |                     | $      |       |   |      | $   | 11,793  |       |  | $      |        |  
|                                                                                                         | Operating income (2)                         |                                 |    | 709                 |       |                     |        |       |   |      |     | 1,996   |       |  |        |        |  
|A reconciliation of segment operating income (loss)
to net loss before income tax expense is as follows:
|Segment Operating income (loss)                                                                          |                                              |                                 |    |                     |       |                     |        |        |   |      |     |         |       |  |        |        
|                                                                                                         | Information Services                         |                                 | $  | (640                | )     |                     | $      | (3,065 | ) |      | $   | (1,567  | )     |  | $      | (5,565  | )
|                                                                                                         | Contract Study Services                      |                                 |    | 709                 |       |                     |        |       |   |      |     | 1,996   |       |  |        |        |  
|                                                                                                         |                                              |                                 |    |                     |       |                     |        |        |   |      |     |         |       |  |        |         |  
|                                                                                                         |                                              |                                 | 69 |                     |       |                     | (3,065 | )      |   |      | 429 |         |       |  | (5,565 | )      
|                                                                                                         | Selling, general and administrative expenses |                                 |    | 5,675               |       |                     |        | 4,269  |   |      |     | 16,039  |       |  |        | 14,972  |  
|                                                                                                         | Interest (income), net                       |                                 |    | (327                | )     |                     |        | (786   | ) |      |     | (1,640  | )     |  |        | (2,410  | )
|                                                                                                         | Other (income) expense                       |                                 |    |                    |       |                     |        |       |   |      |     |        |       |  |        | (250    | )
|                                                                                                         |                                              | Write-down of equity investment |    |                     | 4,268 |                     |        |        |  |      |     |         | 4,268 |  |        |         |  | 
|                                                                                                         |                                              |                                 |    |                     |       |                     |        |        |   |      |     |         |       |  |        |         |  
|                                                                                                         | Net loss before income tax expense           |                                 | $  | (10,542             | )     |                     | $      | (6,548 | ) |      | $   | (18,238 | )     |  | $      | (17,877 | )
|                                                                                                         |                                              |                                 |    |                     |       |                     |        |        |   |      |     |         |       |  |        |         |  

(1)  Includes an allocation of amortization and depreciation of $3,411 and
$3,413 for the three months ended September 30, 2003 and 2002, respectively,
and $10,283 and $8,935 for the nine months ended September 30, 2003 and 2002,
respectively.

(2)  Includes an allocation of amortization and depreciation of $395 and $780
for the three and nine months ended September 30, 2003, respectively.


For no periods reported herein did a single customer account for 10% or
more of the Companys revenue. The following is a breakdown of the Companys
total revenue by geographic region:

|                            |                    |  |               |    |             |  |        |    |   |  |  |    |  
|--------------------------- | ------------------ |  | ------------- | -- | ----------- |  | ------ | -- | - |  |  | -- | -
|                            |                    |  | North America |    | Pacific Rim |  | Europe
|                            |                    |  |               |    |             |  |       
|For the three months ended: |                    |  |               |    |             |  |        |    |   |  |  |   
|                            | September 30, 2003 |  |               | 48 | %           |  |        | 33 | % |  |  | 19 | %
|                            | September 30, 2002 |  |               | 44 | %           |  |        | 35 | % |  |  | 21 | %
|For the nine months ended:  |                    |  |               |    |             |  |        |    |   |  |  |   
|                            | September 30, 2003 |  |               | 47 | %           |  |        | 34 | % |  |  | 19 | %
|                            | September 30, 2002 |  |               | 47 | %           |  |        | 32 | % |  |  | 21 | %

Note 5  Long-Term Investments

During the quarter ended September 30, 2003, the Company recorded a $4,268
write-down of its investment in Neuralstem, a privately held unconsolidated
investee, due to a decline in Neuralstems estimated market value that was
deemed to be other than temporary. This write-down represented the remaining
book value of this investment.

10.



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##### 



Note 6  Subsequent Event

Operating Leases

The Company conducts all of its operations from leased facilities in
Gaithersburg, Maryland and Berkeley, California, under operating leases with
varying terms expiring through 2013. These leases obligate the Company to pay
building operating costs and also contain renewal provisions which may extend
their term.

In October 2003, the Company entered into an amended lease agreement
pertaining to one of its office leases. Under the amended lease agreement, the
Company extended the term of its existing office space and added additional
office space, both with terms expiring through 2013. Rent for the additional
office space will commence in January 2004.

Future minimum lease payments under all lease agreements for the three
months and years ending December 31 are as follows:

|                                              |  |   |        | 
|--------------------------------------------- |  | - | ------ | 
|For the three months ending December 31, 2003 |  | $ | 1,128  | 
|2004                                          |  |   | 4,782  | 
|2005                                          |  |   | 4,888  | 
|2006                                          |  |   | 5,022  | 
|2007                                          |  |   | 4,923  | 
|2008 and thereafter                           |  |   | 12,714 | 
|                                              |  |   |        | 
|                                              |  | $ | 33,457 | 
|                                              |  |   |        | 

11.



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Item 2. Managements Discussion and Analysis of Results of Operations and Financial Condition

Certain statements contained in this Form 10-Q constitute forward-looking
statements within the meaning of the United States Private Securities
Litigation Reform Act of 1995, as amended. Such statements are typically
identified by words or phrases such as believe, expect, anticipate,
intend, estimate, may, goals, hopes, strategies, and similar
expressions or future or conditional verbs such as will, should, would,
and could. These statements are based on managements current expectations
and involve estimates, assumptions, risks and uncertainties that could cause
actual results to differ materially from those stated or implied by the
forward-looking statements. The Company assumes no obligation to update any
forward-looking statements herein, which speak only as of the date of this Form
10-Q. These risks and uncertainties are those set forth in Item 5. Other
Information  Risks Related To Our Business in our Quarterly Report on Form
10-Q for the quarter ended June 30, 2003 and other risks that we disclose from
time to time in our Annual Report on Form 10-K or other filings with the
Securities and Exchange Commission.

Unless the context requires otherwise, references in this Quarterly Report
to Gene Logic, the Company, we, us, and our refer to Gene Logic Inc.
GeneExpress® and ToxExpress® are registered trademarks of Gene Logic.
GeneChip® is a registered trademark of Affymetrix, Inc.

OVERVIEW

We are a leading drug development services company providing a wide range
of discovery and development services to pharmaceutical and biotechnology
companies worldwide, as well as U.S. Government entities. On April 1, 2003, we
completed our acquisition by merger of TherImmune Research Corporation
(TherImmune), a privately held contract study services company. The purpose
of the acquisition was to 1) create a more sizeable drug discovery and
development services entity with expanded service capabilities; 2) realize
potential synergies from the combination of our information services business
and their contract study services business; and 3) enhance our revenue growth
and accelerate our time to profitability. Total consideration paid for the
acquisition, after adjustment, was $51.1 million, including transaction costs
of $1.3 million. Of the consideration paid to securityholders, we paid $30.4
million in cash and issued 3,927,214 shares of Common Stock, with a value of
$19.4 million based on the average market price of our Common Stock surrounding
the measurement date. Approximately 5% of the total consideration is being
held in escrow at least through October 1, 2004 to satisfy potential
indemnification obligations of the TherImmune securityholders. The transaction
has been accounted for under the purchase method of accounting.

Our services are designed to assist in improving the predictive value of
research activities and product success rates. We manage our business as two
segments: information services and contract study services. Our information
services business is based on our gene expression reference database, the
GeneExpress System, for research related to drug discovery and optimization.
These services primarily consist of subscriptions to the GeneExpress System,
which historically have constituted greater than 90% of our information
services segments revenue. We have also licensed other products, which
historically have constituted less than 10% of our total revenue. Our contract
study services business consists of services related to drug development,
including preclinical safety and pharmacology studies as well as analytical
laboratory and Phase I clinical trial services.

Our future profitability will depend on: 1) the continued successful
development of our information services business through the establishment of
subscription agreements with new GeneExpress System customers, and, with
respect to existing GeneExpress System customers, the renewal of current
subscription agreements and agreements for additional information services; and
2) the continued successful development of our contract study services
business. While historically our primary source of revenue to date had been
from our information services based on the GeneExpress System, we expect going
forward that our primary sources of revenue will be from a combination of our
information services and contract study services. Revenue from our customers
may be subject to significant fluctuation in both timing and amount; therefore,
our results of operations for any period may not be comparable to the results
of operations for any other period or predictive of any long term trend.

We have incurred operating losses in each year since our inception,
including losses of $24.1 million in 2002, $33.2 million in 2001 and $24.0
million in 2000. At September 30, 2003, we had an accumulated deficit of
$179.3 million. Our losses have resulted principally from costs incurred in
the development of our GeneExpress System and selling, general and
administrative costs associated with our operations. These costs have exceeded
our revenue; we expect to incur additional operating losses in the future.

QUARTERLY RESULTS

Our quarterly operating results are subject to variation, and are expected
to continue to be subject to variation, as a result of factors such as 1) the
offering of new or improved services; 2) timing of additional customers and
service renewals for existing customers; 3) revenue increases as a result of
acquisitions; 4) delays in initiation and/or nonrenewal of subscription
agreements to the GeneExpress System by major customers; and 5) delays in
initiation, reduction in size and/or termination of contract study services by
our major customers. Such factors will continue to be unpredictable, based
primarily on the dynamics of the drug discovery and development industry.

12.



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RESULTS OF OPERATIONS

Consolidated results of operations below reflect the inclusion of
TherImmune since the acquisition date, April 1, 2003, and do not include any
pro forma information except where noted.

Three Months Ended September 30, 2003 and 2002

Total Revenue.Total revenue increased $3.5 million or 25% to $17.7
million for the three months ended September 30, 2003 from $14.2 million for
the same period in 2002. During the three months ended September 30, 2003, no
customer accounted for 10% or greater of our revenue. During the three months
ended September 30, 2003 and 2002, 33% and 35% of our revenue, respectively,
was from customers in the Pacific Rim.

Information Services Revenue.Revenue from our information services
business (consisting primarily of fees from subscription agreements to gene
expression-based information solutions derived from the GeneExpress System) for
the three months ended September 30, 2003 was $12.3 million, a decrease of $1.9
million or 14% from $14.2 million for the same period in 2002. The decrease in
revenue consisted primarily of reduced revenue of $3.5 million in subscription
fees resulting from the conclusion or reduction in scope of agreements with
customers, partially offset by increased revenue of $1.1 million in
subscription fees from new customers and expanded agreements with existing
customers and $0.5 million reflecting a full period of revenue from existing
customers for the current period as compared to the same period in 2002. Due
to current economic uncertainty, we continue to experience delays in purchasing
decisions among a number of our existing and potential customers which we
expect to slow our rate of revenue growth for the foreseeable future. For the
remainder of 2003, we expect lower revenue from our information services
business, as compared to the same period in 2002.

Contract Study Services Revenue.Revenue from our contract study services
business for the three months ended September 30, 2003 was $5.5 million as a
result of the acquisition of TherImmune on April 1, 2003. Such revenue
consisted primarily of fees from services related to drug development,
including preclinical safety and pharmacology studies, as well as analytical
laboratory and Phase I clinical trial services. We expect contract study
services revenue for 2003 to be lower than that for 2002.

Cost of Contract Study Services Revenue.Cost of contract study services
revenue was $4.7 million for the three months ended September 30, 2003. Such
costs consist primarily of direct costs and indirect allocations related to
conducting contract study services. Gross margin for our contract study
services business in the third quarter of 2003 was negatively impacted by lower
revenue in the third quarter of 2003 resulting in a decrease to 13% as compared
to 20% in the second quarter of 2003. We expect our gross margin for the
fourth quarter of 2003 to be comparable to that of the third quarter of 2003.

Database Production Expense.Database production expenses, which
consisted primarily of costs related to the acquisition and processing of
tissues and overhead expenses needed to support the content of the GeneExpress
System, decreased to $12.4 million for the three months ended September 30,
2003 from $16.6 million for the same period in 2002. The decrease consisted
primarily of a reduction of expenses of $2.6 million for database content
generation resulting from more focused content development of our GeneExpress
System and a reduction of $0.6 million and $0.3 million for customer hardware
deployment and patent abandonment costs, respectively, in 2003 as compared to
2002.For the remainder of 2003, database production expenses are expected to
be lower than the comparable period in 2002 due to our continued effort to
focus content development in areas of most interest to our customers.

Research and Development Expense.Research and development expenses
decreased to $0.5 million during the three months ended September 30, 2003 from
$0.6 million for the same period in 2002. Such expenses include the costs
associated with our efforts to improve the processes currently used in the
production of our GeneExpress System, as well as research on additional
technology platforms.

Selling, General and Administrative Expense.Selling, general and
administrative expenses, which consisted primarily of costs of sales and
marketing, finance and accounting, legal, human resources and other general
corporate operations, increased to $5.7 million during the three months ended
September 30, 2003 from $4.3 million for the same period in 2002. Excluding
the $1.7 million in selling, general and administrative expenses as a result of
the TherImmune acquisition, the resulting decrease in 2003 was due primarily to
continued cost savings efforts, including a reduction in marketing expenses of
$0.4 million. For the remainder of 2003, selling, general and administrative
expenses are expected to increase from 2002 as a result of the acquisition of
TherImmune.

During the fourth quarter of 2003, we announced the elimination of
approximately 50 positions in connection with the rebalancing of our workforce
to meet our strategic initiatives. We expect to hire a comparable number of
employees over the coming quarters, primarily in contract study services,
marketing and sales. As a result of this initiative, we expect to record in
the fourth quarter of 2003 additional selling, general and administrative
expenses of approximately $0.5 million due to severance-related costs.

Net Interest Income.Net interest income decreased to $0.3 million during
the three months ended September 30, 2003 from $0.8 million for the same period
in 2002, due to a decline in the rates of return in and our balance of cash,
cash equivalents and marketable securities available-for-sale as a result of
cash used for the TherImmune acquisition, completed on April 1, 2003.

13.



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Write-down of Equity Investment.During the three months ended September
30, 2003, we recorded a $4.3 million write-down of our investment in Neuralstem
due to a decline in Neuralstems estimated market value that was deemed to be
other than temporary. This write-down represented the remaining book value of
this investment.

Income Tax.Income tax expense increased to $0.6 million for the three
months ended September 30, 2003 from $0.4 million for the same period in 2002,
due to Japanese government tax on certain payments by our Japanese customers.
We expect income tax expense to increase in 2003, compared to 2002, as we
recognize a full year of activity from such customers in 2003.

Nine Months Ended September 30, 2003 and 2002

Total Revenue.Total revenue increased $9.8 million or 24% to $49.9
million for the nine months ended September 30, 2003 from $40.1 million for the
same period in 2002. During the nine months ended September 30, 2003, no
customer accounted for 10% or greater of our revenue. During the nine months
ended September 30, 2003 and 2002, 34% and 32% of our revenue, respectively,
was from customers in the Pacific Rim.

Information Services Revenue.Revenue from our information services
business for the nine months ended September 30, 2003 was $38.1 million
compared to $40.1 million for the same period in 2002. The decrease in revenue
consisted primarily of reduced revenue of $8.6 million in subscription fees
resulting from the conclusion or reduction in scope of agreements with
customers and $1.6 million resulting from certain service deliverables in 2002
which did not continue in 2003. These decreases were partially offset by
increased revenue of $4.6 million in subscription fees from new customers and
expanded agreements and additional fees with existing customers and $3.4
million reflecting a full period of revenue from existing customers for the
current period as compared to the same period in 2002.

Contract Study Services Revenue.Revenue from our contract study services
business for the nine months ended September 30, 2003 was $11.8 million as a
result of the acquisition of TherImmune on April 1, 2003.

Cost of Contract Study Services Revenue.Cost of contract study services
revenue was $9.8 million for the nine months ended September 30, 2003. Gross
margin for our contract study services business during this period was 17%.

Database Production Expense.Database production expenses decreased to
$38.1 million for the nine months ended September 30, 2003 from $43.6 million
for the same period in 2002, reflecting a reduction in expenses of $6.0 million
for database content generation resulting from more focused content development
of our GeneExpress System and a reduction of $0.8 million and $0.5 million for
customer hardware deployment and patent abandonment costs, respectively, in
2003 as compared to 2002. These decreases were partially offset by an increase
in employee costs and depreciation and amortization expenses of $1.4 million
each.

Research and Development Expense.Research and development expenses
decreased to $1.6 million during the nine months ended September 30, 2003 from
$2.1 million for the same period in 2002, due primarily to reductions in
employee costs of $0.2 million and laboratory supplies and agreements with
third parties of $0.1 million each.

Selling, General and Administrative Expense.Selling, general and
administrative expenses increased to $16.0 million during the nine months ended
September 30, 2003 from $15.0 million for the same period in 2002. Excluding
the $3.1 million in selling, general and administrative expenses as a result of
the TherImmune acquisition, the resulting decrease in 2003 was due primarily to
cost saving efforts, including a reduction in travel and marketing expenses of
$1.1 million. Also in 2002, we incurred severance expenses of $0.3 million
which did not recur in 2003.

Net Interest Income.Net interest income decreased to $1.6 million during
the nine months ended September 30, 2003 from $2.4 million for the same period
in 2002, due to a decline in the rates of return in and our balance of cash,
cash equivalents and marketable securities available-for-sale as a result of
our TherImmune acquisition.

Write-down of Equity Investment.During the three months ended September
30, 2003, we recorded a $4.3 million write-down of our investment in Neuralstem
due to a decline in Neuralstems estimated market value that was deemed to be
other than temporary. This write-down represented the remaining book value of
this investment.

Income Tax.Income tax expense increased to $1.6 million for the nine
months ended September 30, 2003 from $1.0 million for the same period in 2002,
due to Japanese government tax on certain payments by our Japanese customers as
we recognized a full period of activity from such customers in 2003.

14.



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LIQUIDITY AND CAPITAL RESOURCES

From inception through September 30, 2003, we have financed our operations
and acquisitions through the sale of equity securities and payments from
customers. As of September 30, 2003, we had approximately $114.2 million in
cash, cash equivalents and marketable securities available-for-sale, compared
to $167.1 million as of December 31, 2002.

Net cash used in operating activities was $10.0 million for the nine
months ended September 30, 2003 and $17.4 million during the same period in
2002, due primarily to the continued funding of our operating losses.

During the nine months ended September 30, 2003 and 2002, our investing
activities consisted primarily of purchases, sales and maturities of marketable
securities available-for-sale, the acquisition of TherImmune, capital
expenditures and software development and database upgrade costs. Capital
expenditures for the nine months ended September 30, 2003 and 2002 amounted to
$1.1 million and $1.7 million, respectively. The decrease in expenditures
related to the purchases of laboratory and computer equipment in 2002 needed to
expand the content of the GeneExpress System. We expect capital expenditures
for the remainder of 2003 to continue at a similar rate as compared to the same
period in 2002. However, we expect to have additional expenditures of
approximately $2.2 million in connection with the build-out and furnishing of
our expanded facilities in 2003.

We have capitalized software development costs of $5.3 million and $5.4
million for the nine months ended September 30, 2003 and 2002, respectively,
related to ongoing efforts to enhance the software platform of our GeneExpress
System. During the nine months ended September 30, 2002, we capitalized $3.9
million of costs related to the upgrade of the human content in the GeneExpress
System, as a result of Affymetrixs release of their GeneChip Human Genome
U-133 Set. Software development and database upgrade costs are being amortized
over their expected useful lives of three and two years, respectively.
Additional software development and database upgrade costs are expected to
continue as a result of ongoing efforts to further enhance the software
platform and certain content of our GeneExpress System.

In connection with the acquisition of TherImmune, we paid $30.4 million in
cash to stock and option holders of TherImmune, paid $1.2 million in
transaction costs related to the acquisition and acquired $1.2 million in cash
from TherImmune.

Our financing activities, other than the repayment of loans and capital
leases, primarily consisted of cash provided from the exercise of stock options
and participation in our employee stock purchase plan. In connection with the
TherImmune acquisition, we repaid $6.0 million in debt of TherImmune.

To generate our gene expression data, we use Affymetrix microarrays,
instrumentation and software and related reagents. Our current supply and
license agreement with Affymetrix expires in December 2005, or earlier in the
event of breach by either party following notice and opportunity to cure. After
December 2005, we would continue to have the right to use up our supply of
previously purchased microarrays. Under the terms of the agreement, we pay
Affymetrix subscription fees for access to the microarrays and for the purchase
of the microarrays and related instrumentation and software. We also must pay
royalties, anticipated to begin in 2004, upon meeting certain GeneExpress
System subscription revenue thresholds. In 2002, we incurred payment
obligations to Affymetrix in the aggregate amount of approximately $18.8
million. In future years, our annual payment obligation will be at least $4.0
million in accordance with the terms of the agreement.

Future minimum capital lease payments, long-term debt payments, payment obligations under our Affymetrix agreement and operating lease payments
are listed below:

|                          |  |       |        |                 |  |             |       |             |  |             |        |  |  |   |        |  |  |   |        | 
|------------------------- |  | ----- | ------ | --------------- |  | ----------- | ----- | ----------- |  | ----------- | ------ |  |  | - | ------ |  |  | - | ------ | 
|                          |  | Total |        | Within 3 Months |  | 2004 & 2005 |       | 2006 & 2007 |  | Beyond 2007
|                          |  |       |        |                 |  |             |       |             |  |            
|Capital lease obligations |  | $     | 493    |                 |  | $           | 29    |             |  | $           | 260    |  |  | $ | 204    |  |  | $ |       | 
|Long-term debt            |  |       | 721    |                 |  |             | 11    |             |  |             | 86     |  |  |   | 546    |  |  |   | 78     | 
|Payment obligations       |  |       | 9,000  |                 |  |             | 1,000 |             |  |             | 8,000  |  |  |   |       |  |  |   |       | 
|Operating leases          |  |       | 33,457 |                 |  |             | 1,128 |             |  |             | 9,670  |  |  |   | 9,945  |  |  |   | 12,714 | 
|                          |  |       |        |                 |  |             |       |             |  |             |        |  |  |   |        |  |  |   |        | 
|Total                     |  | $     | 43,671 |                 |  | $           | 2,168 |             |  | $           | 18,016 |  |  | $ | 10,695 |  |  | $ | 12,792 | 
|                          |  |       |        |                 |  |             |       |             |  |             |        |  |  |   |        |  |  |   |        | 

We believe that existing cash, cash equivalents and marketable securities
available-for-sale and anticipated payments from customers will be sufficient
to support our operations for the foreseeable future. These estimates are
forward-looking statements that involve risks and uncertainties. Our actual
future capital requirements and the adequacy of our available funds will depend
on many factors, including those discussed in Item 5. Other Information 
Risks Related To Our Business in our Quarterly Report on Form 10-Q for the
quarter ended June 30, 2003.

15.



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CRITICAL ACCOUNTING POLICIES

Our consolidated financial statements are prepared in accordance with
accounting principles generally accepted in the United States, which require
management to make estimates and assumptions that affect the reported amounts
of assets and liabilities at the date of the financial statements and the
reported amounts of revenue and expenses during the reporting period. Actual
results could differ from these estimates. The following discussion highlights
what we believe to be the critical accounting policies and judgments made in
the preparation of these consolidated financial statements.

Revenue Recognition

Information Services Revenue.Information services revenue consists
primarily of subscription fees earned under subscription agreements for all or
parts of the Companys gene expression reference database, the GeneExpress
System. Information derived from the GeneExpress System is used for research
related to drug discovery and optimization by pharmaceutical and biotechnology
companies. Each of the subscription agreements with our GeneExpress System
customers is for a specific term, typically, over a multi-year period. In
general, our revenue recognition for information services agreements is
consistent with our performance under such agreements and revenue is recognized
over the period during which the customer has access. Such agreements provide
for termination in the event of a breach of the agreement by either party or a
bankruptcy or insolvency of either party. Revenue, based on subscription fees
received under such agreements, is recorded ratably over the term of the
related GeneExpress System subscription agreement. Certain subscription
agreements include a right of early termination (which, in some instances, is
subject to conditions) by the customer, without penalty, on a specified date
prior to the normal expiration of the term. If an agreement has a right of
early termination, revenue is recognized ratably over the subscription term up
to the possible date of early termination, based on subscription fees earned
under the agreement through the possible date of early termination. In the
absence of early termination, the balance of the subscription fees earned under
the agreement is recognized as revenue ratably over the remaining term of the
agreement.

Contract Study Services Revenue.Contract study services revenue is
derived from cost-plus and fixed-fee contracts with pharmaceutical and
biotechnology companies, as well as U.S. Government entities. Revenue is
recognized on cost-plus contracts on the basis of the direct costs incurred
plus indirect costs and an allocable portion of the fee earned. Revenue is
recognized on fixed-fee contracts as services are performed, based primarily
upon the percentage of hours worked (including subcontractor hours) compared to
the total estimated hours for the contract. The Company believes that hours
worked is the best measure of proportional performance under fixed-fee
contracts. Billings under government contracts are based on provisional
billing rates which permit recovery of fringe benefits, overhead and general
and administrative expenses not exceeding certain limits. These indirect
expense rates are subject to review by the government on an annual basis. When
the final determination of the allowable rates for any year has been made,
billings may be adjusted accordingly. Cost and profit estimates are reviewed
periodically as the work progresses, and adjustments, if needed, are reflected
in the period in which the estimates are revised. Provisions for estimated
losses on uncompleted contracts are made in the period in which such losses are
determined.

Our revenue recognition policy is significant because revenue is a key
component of our results of operations. Revenue is recognized in accordance
with SAB 101. SAB 101 requires four basic criteria be met before revenue can be
recognized: 1) persuasive evidence of an arrangement exists; 2) delivery has
occurred or services rendered; 3) the fee is fixed and determinable; and 4)
collectability is reasonably assured. As to 1), our business practices require
that our services be performed pursuant to contracts with our customers. As to
2), we recognize revenue when services are rendered to our customers.
Determination of 3) and 4) are based on managements judgments regarding the
fixed nature of our arrangements taking into account termination provisions and
the collectability of fees under our arrangements. In addition, management
reviews costs billed under our government contracts to ensure compliance with
governmental regulations and cost and profit estimates on uncompleted
contracts. Should changes in conditions cause management to determine these
criteria are not met for certain future arrangements, that billed costs under
our government contracts are not allowed or that cost or profit estimates
change resulting in losses under such contracts, revenue recognized for any
reporting period would be adjusted and could be adversely affected.

Goodwill and Intangible Assets Impairment

We have recently recorded goodwill of $43.0 million and an intangible
asset, customer relationships, of $2.5 million as a result of the acquisition
of TherImmune. Prior to the acquisition, we had recorded goodwill and other
intangible assets including licenses to technologies or data, patent costs and
software development and database upgrade costs. The determination of their
estimated useful lives and whether or not any of these assets are impaired
involves significant judgment including the following:



| |  |  | Our licenses and internally developed intellectual property may not provide valid and economical competitive advantage;
| | - |  | -----------------------------------------------------------------------------------------------------------------------
| |  |  | Our services may become obsolete before we recover the costs incurred in connection with their development;            
| |  |  | Our use of such assets; and                                                                                            
| |  |  | The fair value of each business segment relative to its book value.                                                    

16.



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Goodwill and other intangible assets are reviewed for impairment on an
ongoing basis under the established accounting guidelines. Changes in business
condition could potentially cause adjustments to asset valuations, possibly
necessitating an impairment charge in the future.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

The Emerging Issues Task Force Issue No. 00-21, Accounting for Revenue
Arrangement with Multiple Deliverables (Issue No. 00-21), addresses
circumstances involving the delivery or performance of multiple products,
services, and/or rights to use assets, and for which performance may occur at
different points in time or over different periods of time. The issue also
addresses whether the different revenue-generating activities, or deliverables,
are sufficiently separable, and there exists sufficient evidence of their fair
values to separately account for some or all of the deliverables. The issue
applies to all contractual arrangements under which a vendor will perform
multiple revenue-generating activities. Issue No. 00-21 is effective for all
revenue arrangements entered into in fiscal periods beginning after June 15,
2003, with early adoption permitted. We adopted this guidance prospectively
for all revenue arrangements entered into after January 1, 2003, and the impact
of adoption was not material to our results of operations.

In January 2003, the Financial Accounting Standards Board issued
Interpretation No. 46, Consolidation of Variable Interest Entities
(Interpretation No. 46). The objective of Interpretation No. 46 is to
improve financial reporting by companies involved with variable interest
entities. The Interpretation requires variable interest entities to be
consolidated by a company if that company is subject to a majority of the risk
of loss from the variable interest entitys activities or is entitled to
receive a majority of the entitys residual returns or both. Interpretation
No. 46 is effective immediately for arrangements entered into or modified after
January 31, 2003 and will be applied to all arrangements entered into or
modified before February 1, 2003 during the quarter ending December 31, 2003.
The initial adoption of Interpretation No. 46 for arrangements entered into or
modified after January 31, 2003 did not have any impact on our financial
position or results of operations. We are still evaluating the impact of
Interpretation No. 46 for all arrangements entered into prior to February 1,
2003; however, we do not anticipate that the impact of these arrangements will
have a material effect on our financial position or results of operations.

In May 2003, the Financial Accounting Standards Board issued Statement No.
150, Accounting for Certain Financial Instruments with Characteristics of Both
Liabilities and Equity (Statement No. 150). Statement No. 150 established
standards for how an issuer classifies and measures certain financial
instruments with characteristics of both liabilities and equity. Statement No.
150 is effective for financial instruments entered into or modified after May
31, 2003, and otherwise is effective at the beginning of the first interim
period beginning after June 15, 2003. We adopted Statement No. 150 on July 1,
2003, with no effect on our financial position or results of operations.

Item 3. Quantitative and Qualitative Disclosure About Market Risk

We have limited exposure to financial market risks, including changes in
interest rates. At September 30, 2003, we had cash and cash equivalents of
$71.0 million and marketable securities available-for-sale of $43.1 million.
We invest our excess cash primarily in money market funds, obligations of the
U. S. Government and its agencies and marketable debt securities of companies
with strong credit ratings. These instruments have maturities of twenty-four
months or less when purchased. We do not utilize derivative financial
instruments, derivative commodity instruments or other market risk sensitive
instruments, positions or transactions in any material fashion. Accordingly,
we believe that, while the instruments we hold are subject to changes in the
financial standing of the issuer of such securities, we are not subject to any
material risks arising from changes in foreign currency exchange rates,
commodity prices, equity prices or other market changes that affect market risk
sensitive instruments. Based on our cash and cash equivalents and marketable
securities available-for-sale balances at September 30, 2003, a 100 basis point
adverse movement in interest rates would have resulted in an increase in the
net loss for the three and nine months ended September 30, 2003 of
approximately $0.3 million and $0.9 million, respectively. Actual changes in
rates may differ from the hypothetical assumptions used in computing this
exposure.

Item 4. Controls and Procedures

As of September 30, 2003, an evaluation was performed under the
supervision and with the participation of our management, including the Chief
Executive Officer and Chief Financial Officer, of the effectiveness of the
design and operation of our disclosure controls and procedures. Based on that
evaluation, our management, including the Chief Executive Officer and Chief
Financial Officer, concluded that our disclosure controls and procedures were
effective as of September 30, 2003.

17.



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PART II                      OTHER INFORMATION

Item 1. Legal Proceedings

We are not currently a party to any material legal proceedings.

Item 2. Change in Securities and Use of Proceeds

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Submission of Matters to a Vote of Security Holders

None.

Item 5. Other Information

None.

Item 6. Exhibits and Reports on Form 8-K

|   |  |                                                                                            |  |                                                                                                                         
|-- |  | ------------------------------------------------------------------------------------------ |  | ------------------------------------------------------------------------------------------------------------------------
|A) |  | Exhibits:                                                                                  |  |                                                                                                                         
|   |  |                                                                                            |  |                                                                                                                         
|   |  | 10.82                                                                                      |  | Employment Agreement, dated as of July 2, 2003, between Registrant and Robert Proulx.                                   
|   |  |                                                                                            |  |                                                                                                                         
|   |  | 31                                                                                         |  | Certifications pursuant to Rule 13a-14(a)/15d-14(a).                                                                    
|   |  |                                                                                            |  |                                                                                                                         
|   |  | 32                                                                                         |  | Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|   |  |                                                                                            |  |                                                                                                                         
|B) |  | Reports on Form 8-K:                                                                      
|   |  |                                                                                            |  |                                                                                                                         
|   |  | During the three months ended September 30, 2003, the Company filed the following reports:



| |                                                                                                                                                  
| | -------------------------------------------------------------------------------------------------------------------------------------------------
| | The Current Report on Form 8-K, filed on July 29, 2003, with respect
to the Companys financial results for the three months ended June 30,
2003.



| |                                                                                                                                                                                                                               
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The Current Report on Form 8-K, filed on July 31, 2003, with respect
to financial statements and pro forma financial information as of March
31, 2003 related to the Companys acquisition of TherImmune Research
Corporation.



| |                                                                                                                                
| | -------------------------------------------------------------------------------------------------------------------------------
| | The Current Report on Form 8-K, filed on September 24, 2003, with
respect to the Companys updated outlook for revenue in 2003.

18.



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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

|                        |  |  |                |                                              |  | 
|----------------------- |  |  | -------------- | -------------------------------------------- |  | 
|                        |  |  | GENE LOGIC INC |                                              | 
|                        |  |  |                |                                              |  | 
|Date: November 13, 2003 |  |  | By:            | /s/ Philip L. Rohrer, Jr.                    |  | 
|                        |  |  |                |                                              |  | 
|                        |  |  |                | Philip L. Rohrer, Jr.                        |  | 
|                        |  |  |                | Chief Financial Officer                      |  | 
|                        |  |  |                | (Principal Financial and Accounting Officer) |  | 

19.