Genelabs Technologies, Inc. has received $1.25 million from Affymetrix Inc. for an amendment to a non-exclusive license to Genelabs' Linker-Aided DNA Amplification technology, which is known as LADA.

Affymetrix had licensed the LADA technology from Genelabs in December 2002. The amendment converts the license to a fully paid up non-exclusive license and eliminates royalties and fees that were payable under the original agreement.

The license covers US patent number 6,107,023 entitled "DNA Amplification and Subtraction Techniques" and corresponding international patents. The '023 patent claims a method of amplifying nucleic acids by attaching DNA linkers of a known sequence to the ends of unknown DNA sequences which are targeted for amplification. By adding these linkers to targeted DNA molecules, users can readily design and construct primers complementary to the attached linkers and amplify the unknown, targeted DNA sequences.

"We are very pleased with this amendment, which immediately monetizes a previously existing royalty obligation to us. The amended license agreement is for certain applications of our LADA technology, which Genelabs developed to facilitate DNA amplification," stated James A.D. Smith, president and CEO. "We are seeking to realize additional value from our LADA intellectual property assets from other parties. At the same time, we are continuing our core focus on drug discovery and development, including Prestara as an investigational new drug for lupus and our programs to discover new treatments for hepatitis C viral infections," he added.

As a result of the cash received from Affymetrix and a milestone received in November from GlaxoSmithKline, Genelabs now expects its cash and cash equivalents to be approximately $2 million higher than the midpoint of the range previously announced. Genelabs presently expects its December 31, 2004 cash and cash equivalents to be approximately $26.5 million.