Thursday, Feb 14, 1985

Genentech Reports Substantial Increase in 1984 Revenues and Income

South San Francisco, Calif. -- February 14, 1985 --

Genentech, Inc. reported today that 1984 revenues and net income increased substantially over 1983.

Revenues for the fiscal year ending December 31, 1984 were $69.8 million, up 48% from $47.0 million in 1983. Net income was $2.7 million in 1984, or 19 cents per share, compared with $1.1 million, or 8 cents per share reported for the previous year.

Robert A. Swanson, chief executive officer, said: "We achieved our revenue goals. 1984 was our sixth consecutive year of profitability."

Operating revenue -- which includes contract research, licensing revenues and manufacture of clinical products for contract partners -- represented 94 percent of Genentech's 1984 revenues.

Fourth quarter revenues were $18.1 million in 1984, compared with $13.5 million in 1983. Fourth quarter net income was $612,000 or 4 cents per share, compared with $226,000 or 2 cents per share in 1983. As in the past, significant quarter-to-quarter income and revenue fluctuations may occur during 1985, due to variations in the timing of revenues for licensing and research benchmarks. These fluctuations have no impact on the company's long-term growth.

1984 was a year of major scientific achievements. Genentech announced three new products: Factor VIII, for treatment of cancer.

A private placement of $33.2 million of partnership interests was successfully competed. The partnership, Genentech Clinical Partners III, will conduct a research and development program to perform human clinical testing and development of TNF.

Genentech is a leading biotechnology company, focusing on the development, manufacture and marketing of pharmaceuticals produced by recombinant DNA technology.

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GENENTECH, INC.
CONDENSED CONSOLIDATED INCOME STATEMENTS

(in thousands, except per share amounts)
(unaudited)

Three Months
Ended December 31,

1984 1983
Revenues
   Contract $ 5,182 $ -
   Contract 17,155 18,909
   Interest 979 1,779
      Total revenues 18,134 25,870
     
Costs and expenses
   Research and development 14,625 16,717
   Marketing, general and administrative 2,831 6,612
      Total costs and expenses 17,456 23,329
     
Income before taxes 678 2,541
Income tax provision 66 358
     
Net income $ 2,813 $ 612
     
Net income per share $ 0.07 $ 0.02
     
Weighted average number of shares used in
   computing per share amounts:
28,791 32,829
 
Twelve Months
Ended December 31,

1984 1983
Revenues
   Contract $ 5,182 $ -
   Contract 65,627 76,453
   Interest 4,159 7,964
      Total revenues 69,786 89,599
     
Costs and expenses
   Research and development 54,892 64,895
   Marketing, general and administrative 11,794 18,112
      Total costs and expenses 66,776 83,007
     
Income before taxes 3,010 6,592
Income tax provision 290 984
     
Net income $ 5,608 $ 2,720
     
Net income per share $ 0.18 $ 0.09
     
Weighted average number of shares used in
   computing per share amounts:
28,740 32,013