DuringThe Company’s two largest customers accounted for 51% and 29% of product revenues for the three months ended JuneSeptember 30, 2007 there wereand 61% and 19% of product revenues for the six months ended September 30, 2007. The Company’s two largest customers who accounted for approximately 70%55% and 13% of product revenues for the three months ended September 30, 2006 and 61% and 11% of product revenues respectively. Duringfor the threesix months ended JuneSeptember 30, 2006 there were two customers who accounted for approximately 65% and 10% of product revenues, respectively.2006. At JuneSeptember 30, 2007, the Company’s two largest customers accounted for 56%40% and 24%29% of our accounts receivable. At March 31, 2007, two customers accounted for 47% and 15% of accounts receivable, respectively.

Fair Value Option for Financial Assets and Financial Liabilities

In February 2007, the FASB issued FASB Statement No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities” (SFAS No. 159)(“SFAS 159”). SFAS No. 159 provides companies with an option to report selected financial assets and liabilities at fair value. The objective of SFAS No. 159 is to reduce both complexity in accounting for financial instruments and the volatility in earnings caused by measuring related assets and liabilities differently. Generally accepted accounting principles have required different measurement attributes for different assets and liabilities that can create artificial volatility in earnings. FASB has indicated it believes that SFAS No. 159 helps to mitigate this type of accounting-induced volatility by enabling companies to report related assets and liabilities at fair value, which would likely reduce the need for companies to comply with detailed rules for hedge accounting. SFAS No. 159 also establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities. For example, SFAS No. 159 requires companies to provide additional information that will help investors and other users of financial statements to more easily understand the effect of the company’s choice to use fair value on its earnings. It also requires entities to display the fair value of those assets and liabilities for which the company has chosen to use fair value on the face of the balance sheet. SFAS No. 159 does not eliminate disclosure requirements included in other accounting standards, including requirements for disclosures about fair value measurements included in FASB Statement No. 157, “Fair Value Measurements” (SFAS No. 157), and FASB Statement No. 107, “Disclosures about Fair Value of Financial Instruments” (SFAS No. 107). SFAS No. 159 is effective as of the beginning of a company’s first fiscal year beginning after November 15, 2007. Early adoption is permitted as of the beginning of the previous fiscal year provided that the company makes that choice in the first 120 days of that fiscal year and also elects to apply the provisions of SFAS No. 157. The Company has not yet completed its evaluation of SFAS No. 159, but does not currently believe that adoption will have a material impact on its results of operations, financial position or cash flows.

Accounting for Nonrefundable Advance Payments for Goods or Services to Be Used in Future Research and Development Activities

In June 2007, the FASB issued EITF Issue No. 07-3, “Accounting for Nonrefundable Advance Payments for Goods or Services to Be Used in Future Research and Development Activities,” or (“EITF 07-3.07-3”). EITF 07-3 requires that nonrefundable advance payments for goods or services to be received in the future for use in research and development activities should be deferred and capitalized. The capitalized amounts should be expensed as the related goods are delivered or the services are performed. EITF 07-3 is effective for new contracts entered into during fiscal years beginning after December 15, 2007. The Company is currently analyzing the effect, if any, EITF 07-3 will have on its financial position and results of operations.

On April 6, 2007 Repligen Corporation entered into an exclusive worldwide commercial license agreement with The Scripps Research Institute (“Scripps”). Pursuant to the Agreement,agreement, the Company obtained a license to use, commercialize and sublicense certain patented technology and improvements thereon, owned or licensed by Scripps, relating to compounds which may have utility in treating Friedreich’s Ataxia, an inherited neurodegenerative disease. Research in tissues derived from patients, as well as, in mice, indicates that the licensed compounds increase production of the protein frataxin, which suggests potential utility of these compounds in slowing or stopping progression of the disease. There is currently no treatment for Friedreich’s ataxia.

Pursuant to the Agreement,agreement, the Company agreed to pay Scripps an initial license fee of $300,000, certain royalty and sublicense fees and, in the event the Company achieves specified developmental and commercial milestones, certain additional milestone payments. In addition, the Company issued Scripps 87,464 shares of the Company’s common stock (the “Shares”) representing $300,000 as of the Effective Date. The Company recorded the initial license payment and the value of the shares issued as research and development costs in the accompanying Statement of Operations for the six-month period ended September 30, 2007.

If the value of the Shares does not equal at least $300,000 on the one-year anniversary of the Effective Date, the Company shall make a cash payment to Scripps equal to the difference between the actual total value of the Shares on the one-year anniversary of the Effective Date andDate. At each reporting date during the one-year period beginning on the Effective Date.Date, the Company records a liability to the extent the fair value of the Shares, as calculated using the closing price of the common stock, is below $300,000. At September 30, 2007, the fair value of the shares exceeded $300,000; therefore, no liability has been recorded. The Company issued the Shares in reliance on the exemption from registration provided by Section 4(2) of the Securities Act of 1933, as amended. The Shares were issued exclusively to Scripps as an “accredited investor” (as such term is defined in Rule 501(a) of Regulation D) without general solicitation or advertising and did not involve a public offering.

Furthermore, the Company issued warrants to certain individuals at Scripps to purchase up to 150,000 shares of common stock. The Agreementwarrants have a 7-year term and are exercisable based on performance criteria as detailed in the warrant agreement. No expense has been recorded related to these warrants for the three and six-month periods ended September 30, 2007, as none of the performance criteria has been achieved.

The agreement with Scripps expires or may be terminated (i) when all of the royalty obligations under the Agreementagreement expire; (ii) at any time by mutual written consent; (iii) by Scripps if the Company (a) fails to make payments under the Agreement,agreement, (b) fails to achieve certain developmental and commercial objectives, (c) becomes insolvent, (d) is convicted of a felony relating the manufacture, use or sale of the licensed technology, or (e) defaults in its performance under the Agreement;agreement; or (iv) by the Company upon 90 days written notice.

In May 2004, the Company and the Massachusetts Institute of Technology (“MIT”) filed an action in the United States District Court for the District of Massachusetts against ImClone Systems, Incorporated (“ImClone”) for infringement of U.S. Patent No. 4,663,281 (“the ‘281 patent”) based on ImClone’s manufacture and sale of Erbitux^®. The ‘281 patent, which covers the use of certain genetic elements that increase protein production in a mammalian cell, is assigned to MIT and exclusively licensed to the Company.

On September 10, 2007, the Company and MIT entered into a settlement agreement (the “Settlement Agreement”) with ImClone relating to the lawsuit against ImClone for infringement of the ‘281 patent. Pursuant to the Settlement Agreement, ImClone made a payment of $65 million to the Company and MIT that resulted in net proceeds to the Company of $40.17 million, as follows:

The Settlement Agreement served as the basis for the Company and MIT to dismiss the lawsuit against ImClone and for the Company to grant ImClone a non-exclusive sublicense to the ‘281 patent and certain other intellectual property. There are no further obligations to the Company with respect to the sublicenses. The net gain on litigation settlement was recorded as a separate component of operating expenses on the Company’s Statement of Operations for the three and six-month periods ended September 30, 2007.

ITEM 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Overview

We are a biopharmaceutical company focused on the development of novel therapeutics for the treatment of diseases of the central nervous system. A number of drug development programs are currently being conducted to evaluate our naturally occurring drug candidates in diseases such as bipolar disorder and neurodegeneration. In addition, we sell two commercial products, Protein A for monoclonal antibody purification and SecreFlo^® for assessment of pancreatic disorders.

Our business strategy is to deploy the profits from our current commercial products and any revenue that we may receive from our patents to enable us to invest in the development of our product candidates in the treatment area of neuropsychiatric diseases while reducing our financial risk.

We are subject to a number of risks typically associated with similar companies in the biotechnology industry. Principally, those risks are associated with our dependence on collaborative arrangements, development by us or our competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, results of clinical trials, compliance with the U.S. Food and Drug Administration and other governmental regulations and approval requirements, as well as the ability to grow our business and to obtain adequate capital to fund this growth, as well as other potential risk factors included in the filings made by us from time to time with the SEC, including under the section entitled “Risk Factors” in our Annual Report on Form 10-K for the year ended March 31, 2007.

Critical Accounting Policies and Estimates

A “critical accounting policy” is one which is both important to the portrayal of the Company’s financial condition and results and requires management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. For additional information, please see the discussion of our significantcritical accounting policies in Note 2 to the Consolidated Financial Statements included in our Annual Report on Form 10-K dated March 31, 2007.

Results of Operations

Three months ended JuneSeptember 30, 2007 vs. JuneSeptember 30, 2006

Total revenue

Total revenue for the three-month periods ended JuneSeptember 30, 2007 and JuneSeptember 30, 2006 were approximately $5,978,000$5,352,000 and $3,628,000$2,865,000 respectively, an increase of $2,350,000$2,487,000 or 65%87%. Substantially all of our products based on recombinant Protein A are sold to customers who incorporate our manufactured products into their proprietary antibody purification systems to be sold directly to the pharmaceutical industry. Monoclonal antibodies are a well-established class of drug with applications in rheumatoid arthritis, asthma, Crohn’s disease and a variety of cancers. Sales of Protein A are therefore impacted by the timing of large-scale production orders and on the regulatory approvals for such antibodies, which may result in significant quarterly fluctuations.

During the three months ended JuneSeptember 30, 2007, Protein A sales increased by $2,289,000$2,287,000, or 78%103%, over the same period in the 2007 fiscal 2007. We shipped 75% moreyear. Large increases in the volume of Protein A shipped due to an increase in customer orders in the firstsecond quarter of the 2008 fiscal 2008year have resulted in a 104% positive impact on revenue compared to the same period in the 2007 fiscal 2007.year. The mix of products sold had moreslightly less favorable pricing, resulting in an additional 3% positivea 1% negative impact on total revenue. The Company sells different Protein A products at different price points. The mix of products sold varies and impacts the fluctuations in total sales revenue from yearquarter to year.quarter.

Sales of SecreFlo^® increased $78,000$190,000 or 18%42% in the firstsecond quarter of the 2008 fiscal 2008.year. Increased volume impacted revenue by 2%20% and increased sales prices positively impacted revenues by 16%22%.

The settlement in fiscal 2005 with our sole supplier of SecreFlo^® provides for a certain amount of vials of product that we can ultimately ship.sell. The last shipment of SecreFlo^® to the Company from ChiRhoClin was received in July 2007 and is expected to allow us to fill sales orders into fiscal year 2009. We expect SecreFlo^® revenues will decline by one third in fiscal 2008 as we continue to reduce sales and marketing efforts and focus our sales efforts on key customers.

During the three-month periods ended JuneSeptember 30, 2007 and JuneSeptember 30, 2006, we recognized approximately $200,000$139,000 and $220,000,$149,000, respectively, of revenue from a sponsored research and development project under an agreement with SMRI.

Research revenue is recognized for costs plus fixed-fee contracts as costs are incurred. Additionally, during the three-month periods ended JuneSeptember 30, 2007 and JuneSeptember 30, 2006, we earned and recognized approximately $47,000$56,000 and $44,000,$36,000, respectively in royalty revenue from ChiRhoClin. We expect that total research and license revenues will decline moderately in fiscal 2008.

Operating expenses

Total operating expenses, exclusive of net gain on litigation settlement, were approximately $4,752,000 and $3,961,000 for the three-month periods ended JuneSeptember 30, 2007 and JuneSeptember 30, 2006, were approximately $5,993,000 and $3,750,000, respectively, an increase of $2,243,000$791,000 or 60%20%.

Cost of product revenue were approximately $1,412,000 and $915,000 for the three-month periods ended JuneSeptember 30, 2007 and JuneSeptember 30, 2006, were approximately $1,714,000 and $993,000, respectively, an increase of $721,000$497,000 or 73%54%. ThisThe increase in cost of product revenue is consistent with our increase in volume of Protein A shipped and primarily reflectsdue to increased material costs of $436,000,$333,000, increased personnel and occupancy costs of $113,000$98,000 and increased consulting and manufacturing services of $142,000$66,000 in the three-month period ended JuneSeptember 30, 2007.

Research and development expenses were approximately $1,154,000 and $1,583,000 for the three-month periods ended JuneSeptember 30, 2007 and JuneSeptember 30, 2006, were approximately $2,137,000 and $1,215,000, respectively, an increasea decrease of $922,000$429,000 or 76%27%. This increasedecrease is largely attributable to increased licensing expense of $600,000 attributable to the payment of milestones associated with the signing of the License Agreement with The Scripps Research Institute (or the Scripps License Agreement) which were paid in cash and through the issuance of common stock, as well as increased external research expenses of $262,000 due todecreased clinical trial expenses and expenses associated with our Friedreich’s ataxia project.of $403,000, as the Company’s Phase 2 clinical trial to evaluate the use of RG1068, synthetic human secretin, was completed in the first quarter of the 2008 fiscal year. Significant fluctuations in research and development expenses may occur from period to period depending on the nature, timing, and extent of development activities over any given period of time.

Selling, general and administrative expenses were approximately $2,186,000 and $1,463,000 for the three-month periods ended JuneSeptember 30, 2007 and JuneSeptember 30, 2006, were approximately $2,142,000 and $1,542,000, respectively, an increase of $600,000$723,000 or 39%49%. This increase is largely attributable to an increase inother litigation expenses of $595,000 associatedincurred in conjunction with the prosecution of our patent infringement lawsuitslawsuit against ImClone and litigation expenses incurred in our continuing patent infringement lawsuit against Bristol-Myers Squibb, offset primarily by decreased stock compensation expenses.

Net gain from litigation settlement

On September 10, 2007, Repligen and Imclone.

Interest income

Interest income was approximately $366,000 and $236,000 for the three-month periods ended JuneSeptember 30, 2007 and JuneSeptember 30, 2006, was approximately $257,000 and $225,000 respectively. The increase in the three months ended JuneSeptember 30, 2007 is a result of morehigher interest rates and increased cash and marketable securities as a result of the funds received from the Settlement Agreement with ImClone.

Income Tax Provision

The Company had pretax income of $41.1 million in the three-month period ended September 30, 2007, and an income tax provision of approximately $827,000 in the three-month period ended September 30, 2007. The effective income tax rate for the three months ended September 30, 2007 was 2%. The effective income tax rate is based upon the estimated income for the year and the composition of the income in different jurisdictions. The effective tax rate differs from the statutory tax rate due to the utilization of prior year net operating losses and credits, offset by the effects of the alternative minimum tax (“AMT”) on income derived during the fiscal year.

Six months ended September 30, 2007 vs. September 30, 2006

Total revenue

Protein A sales for the six-month periods ended September 30, 2007 and September 30, 2006 were approximately $9,746,000 and $5,169,000 respectively, an increase of $4,577,000 or 89%. Large increases in the volume of Protein A shipped due to an increase in customer orders in the 2008 fiscal year have resulted in a 90% positive impact on revenue compared to the same period in the 2007 fiscal year. The mix of products sold had slightly less favorable pricing, resulting in a 1% negative

impact on revenue. The Company sells different Protein A products at different price points. The mix of products sold varies and impacts the fluctuations in total sales revenue from period to period.

Sales of SecreFlo^® increased $269,000 or 31% for the six months ended September 30, 2007. Increased volume impacted revenue by 12% and increased sales prices positively impacted revenues by 19%.

During the six-month periods ended September 30, 2007 and September 30, 2006, we recognized $340,000 and $369,000, respectively, of revenue from a sponsored research and development project under an agreement with SMRI. Research revenue is recognized for costs plus fixed-fee contracts as costs are incurred. Additionally, during the six-month periods ended September 30, 2007 and September 30, 2006, we earned and recognized approximately $103,000 and $81,000, respectively, in royalty revenue from ChiRhoClin, Inc.

Operating expenses

Total operating expenses, exclusive of net gain on litigation settlement, were approximately $10,746,000 and $7,710,000 for the six-month periods ended September 30, 2007 and September 30, 2006, respectively, an increase of $3,036,000 or 39%.

Cost of product revenue for the six-month periods ended September 30, 2007 and September 30, 2006 were approximately $3,127,000 and $1,908,000, respectively, an increase of $1,219,000 or 64%. Material costs increased by $806,000, manufacturing services and consulting increased by $123,000 and personnel costs increased by $61,000, which is commensurate with the increase in production necessary to support increased product revenues. The remainder of the increase during the period is primarily driven by increased occupancy and depreciation costs.

Research and development expenses for the six-month periods ended September 30, 2007 and September 30, 2006 were approximately $3,291,000 and $2,798,000, respectively, an increase of $493,000 or 18%. This increase is largely attributable to increased licensing expense of $633,000 attributable to the payment of milestones associated with the signing of the License Agreement with Scripps (“the Scripps License Agreement”), as well as external research and payroll expenses of $241,000 associated with our Friedreich’s ataxia project, offset mainly by decreases in clinical trial expenses of $334,000. Significant fluctuations in research and development expenses may occur from period to period depending on the nature, timing, and extent of development activities over any given period of time.

Selling, general and administrative expenses were approximately $4,328,000 and $3,004,000 for the six-month periods ended September 30, 2007 and September 30, 2006 respectively, an increase of $1,324,000 or 44%. This increase is largely attributable to increased litigation expenses incurred in conjunction with the patent infringement lawsuit against Bristol-Myers Squibb and other litigation expenses incurred in our patent infringement lawsuit against ImClone.

Net gain from litigation settlement

On September 10, 2007, Repligen and MIT entered into the Settlement Agreement with ImClone relating to the lawsuit against ImClone for infringement of the ‘281 patent. Pursuant to the Settlement Agreement, ImClone made a payment of $65 million to Repligen and MIT that resulted in net proceeds to Repligen of $40,170,000. The Settlement Agreement served as the basis to dismiss the lawsuit against ImClone and for Repligen to grant ImClone a non-exclusive sublicense to the ‘281 patent and certain other intellectual property.

Interest income

Interest income for the six-month periods ended September 30, 2007 and September 30, 2006 was approximately $623,000 and $460,000 respectively. The increase in the six months ended September 30, 2007 is a result of higher interest rates.rates and increased cash and marketable securities as a result of the funds received from the Settlement Agreement with ImClone.

Income Tax Provision

The Company had pretax income of $41.4 million in the six-month period ended September 30, 2007, and an income tax provision of approximately $827,000 in the six-month period ended September 30, 2007. The effective income tax rate for the six months ended September 30, 2007 was 2%. The effective income tax rate is based upon the estimated income for the year and the composition of the income in different jurisdictions. The effective tax rate differs from the statutory tax rate due to the utilization of prior year net operating losses and credits, offset by the effects of the alternative minimum tax (“AMT”) on income derived during the fiscal year.

Liquidity and capital resources

We have financed our operations primarily through sales of equity securities and revenues derived from product sales and grant and research agreements. Our revenue for the foreseeable future will be primarily limited to our product revenue related to Protein A and SecreFlo^®. Revenues derived from the sales of SecreFlo^® vials are expected only through calendarfiscal year 2009. Given the uncertainties related to pharmaceutical product development, we are currently unable to reliably estimate when, if ever, our therapeutic product candidates will generate revenue and cash flows. During the three-month period ended September 30, 2007, we received net funds of $40,170,000 as a result of our Settlement Agreement with ImClone. Total cash and marketable securities at JuneSeptember 30, 2007 totaled approximately $21,816,000, a decrease$62,696,000, an increase of $811,000$40,069,000 from $22,627,000 at March 31, 2007.

Operating activities

Our operating activities usedprovided cash of approximately $754,000$40,208,000 for the three-monthsix-month period ended JuneSeptember 30, 2007. Cash usereceived is primarily driven byfrom our settlement with ImClone in September 2007, for which the Company received net proceeds of $40,170,000. Other factors affecting cash from operating activities are changes in operating assets and liabilities being partially offset by net income of approximately $240,000,$41,374,000, which includes non-cash charges of approximately $189,000$389,000 for depreciation and amortization, $187,000$258,000 in stock based compensation expense and $300,000 for issuance of common stock for the Scripps License Agreement.

Investing activities

Cash spending of approximately $195,000$9,696,000 for the three-monthsix-month period ended JuneSeptember 30, 2007 relateswas primarily driven by increased purchases of marketable securities, as the Company began to invest the funds received from the Settlement Agreement with ImClone. In addition, the Company continues to make investments in equipment purchases and facility improvements for our manufacturing suites. Additional cash was used to purchase new marketable securities in the period for amounts in excess of proceeds received from the redemption of marketable securities which matured in the period.Company’s facility.

Financing activities

Stock option exercises provided cash proceeds of approximately $121,000.$179,000.

We do not currently use derivative financial instruments. We generally place our marketable security investments in high quality credit instruments as specified in our investment policy guidelines.

Working capital decreasedincreased to approximately $21,552,000$61,337,000 at JuneSeptember 30, 2007 from $22,394,000 at March 31, 20072007. This increase is primarily as a resultdriven by net gain of cash use in the first quarter of fiscal 2008.$40,170,000 from our Settlement Agreement with ImClone.

Our future capital requirements will depend on many factors, including the following:

Absent an acquisition of aacquisitions of additional products, product candidate,candidates or intellectual property, we believe our current cash and investment balances are adequate to meet our needs for at least the next twenty-four months.needs. Our future capital requirements include, but are not limited to, continued investment in our research and development programs, capital expenditures primarily associated with purchases of equipment and continued investment in our intellectual property portfolio.

We plan to continue to invest in key research and development activities. We actively evaluate various strategic transactions on an ongoing basis, including licensing or acquiring complementary products, technologies or businesses that would complement our existing portfolio of development programs. We continue to seek to acquire such potential assets that may offer us the best opportunity to create value for our shareholders. In order to acquire such assets, we may need to seek

additional financing to fund these investments. This may require the issuance or sale of additional equity or debt securities. The sale of additional equity may result in dilution to our stockholders. Should we need to secure additional financing to acquire a product, fund future investment in research and development, or meet our future liquidity requirements, we may not be able to secure such financing, or obtain such financing on favorable terms because of the volatile nature of the biotechnology marketplace.

Off-Balance Sheet Arrangements

As of JuneSeptember 30, 2007, we did not have any off-balance sheet arrangements.

Commitments

As of JuneSeptember 30, 2007, we had the following fixed obligations and commitments:

Cautionary Statement Regarding Forward-Looking Statements

Statements in this Quarterly Report on Form 10-Q, as well as oral statements that may be made by Repligen or by officers, directors or employees of Repligen acting on its behalf, that are not historical facts constitute “forward-looking statements” which are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The forward-looking statements in this Quarterly Report on Form 10-Q do not constitute guarantees of future performance. Investors are cautioned that statements in this Quarterly Report on Form 10-Q which are not strictly historical statements, including, without limitation, statements regarding current or future financial performance, management’s strategy, litigation strategy, costs of legal proceedings, disputes with suppliers, plans and objectives for future operations, clinical trials and results, marketing plans, revenue potential of therapeutic product candidates, product research, intellectual property and development, manufacturing plans and performance, delays in manufacturing by us or our partners, timing of customer orders, the anticipated growth in our target markets, including, without limitation, the market for neuropsychiatric disorders treatment, the market for pancreatic disease treatment, the monoclonal antibody market and the process chromatography industry and projected growth in product sales, costs of operations, sufficiency of funds to meet management objectives and availability of financing and effects of accounting pronouncements constitute forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause our actual results to be materially different from the historical results or from any results expressed or implied by such forward-looking statements, including, without limitation, risks associated with: the success of current and future collaborative relationships, the success of our clinical trials and our ability to develop and commercialize products, our ability to obtain required regulatory approvals, our compliance with all Food and Drug Administration regulations, our ability to obtain, maintain and protect intellectual property rights for our products, the risk of current and future litigation regarding our patent and other intellectual property rights, the risk of litigation with collaborative partners, our limited sales and marketing experience and capabilities, our limited manufacturing capabilities and our

dependence on third-party manufacturers and value-added resellers, our ability to hire and retain skilled personnel, the market acceptance of our products, our ability to compete with larger, better financed pharmaceutical and biotechnology companies that may develop new approaches to the treatment of our targeted diseases, our history of losses and expectation of incurring continued losses, our ability to generate future revenues, our ability to raise additional capital to continue our drug development programs, our volatile stock price, and the effects of our anti-takeover provisions. Further information on potential risk factors that could affect our financial results are included in the filings made by us from time to time with the Securities and Exchange Commission including under the section entitled “Certain Factors That May Affect Future Results” in our Annual Report on Form 10-K for the year ended March 31, 2007.

Interest Rate Risk

We have investments in commercial paper, U.S. Government and agency securities, as well as corporate bonds and other debt securities. As a result, we are exposed to potential loss from market risks that may occur as a result of changes in interest rates, changes in credit quality of the issuer or otherwise.

We generally place our marketable security investments in high quality credit instruments, as specified in our investment policy guidelines. A hypothetical 100 basis point increase in interest rates would result in an approximate $89,000$128,000 decrease in the fair value of our investments as of JuneSeptember 30, 2007. We believe, however, that the conservative nature of our investments mitigates our interest rate exposure, and our investment policy limits the amount of our credit exposure to any one issue, issuer (with the exception of U.S. agency obligations) and type of instrument. We do not expect any material loss from our marketable security investments and therefore believe that our potential interest rate exposure is limited. We intend to hold the majority of our investments to maturity, in accordance with our business plans.

The Company’s management, with the participation of our chief executive officer (principal executive, financial and chief financial officer,accounting officer), has evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based on such evaluation, our chief executive officer and chief financial officer havehas concluded that, as of the end of such period, the Company’s disclosure controls and procedures were effective in ensuring that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, on a timely basis, and is accumulated and communicated to the Company’s management, including the Company’s chief executive officer, and chief financial officer, as appropriate to allow timely decisions regarding required disclosure.

There was no change in the Company’s internal control over financial reporting that occurred during the period covered by this Quarterly Report on Form 10-Q that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION

ImcloneImClone Systems

In June 2007,May 2004, Repligen reported thatand MIT filed an action in the United States District Court for the District of Massachusetts set a trial date of September 10, 2007 in the ongoing patent infringement lawsuit brought by Repligen and The Massachusetts Institute of Technology or MIT against ImClone Systems, Incorporated or ImClone. In their complaint, Repligenfor infringement of the ‘281 patent based on ImClone’s manufacture and MIT allege that ImClone’s productionsale of Erbitux^® infringes U.S. patent 4,663,281 or the. The ‘281 patent, which covers the use of certain genetic elements that increase protein production in a mammalian cell. This patentcell, is assigned to MIT and exclusively licensed to Repligen.

Repligen also announced in JuneOn September 10, 2007, that the Court issued a favorable ruling on the sanctions motion filed by Repligen and MIT entered into the Settlement Agreement with ImClone relating to the lawsuit against ImClone based on conduct that, in Repligen’s view, constituted intimidation of a central witness in the case, one of the inventorsfor infringement of the ‘281 patent. The Court found thatPursuant to the actionsSettlement Agreement, ImClone made a payment of ImClone’s in-house and outside counsel were intended$65 million to block the cooperation of the inventor and that these actions prejudiced Repligen and MIT from fully prosecuting their case. As onethat resulted in net proceeds to Repligen of $40.17 million after payment of obligations to MIT and legal expenses. The Settlement Agreement served as the remedies, the Court grantedbasis for Repligen and MIT permission to introduce evidence ofdismiss the improper conduct of ImClone’s attorneys at triallawsuit against ImClone and for Repligen to lay the foundation for the jury to infer thatgrant ImClone itself believed that the witness’ testimony supported Repligen and MIT’s claims in the litigation.

ImClone previously reported that it produced approximately $1 billion worth of Erbitux^® priora non-exclusive sublicense to the expiration of the patent-in-suit in 2004‘281 patent and that certain other intellectual property.

Bristol-Myers Squibb ImClone’s commercial partner, has paid ImClone $900 million in up-front and milestone payments as well as a 39% royalty on the net sales of Erbitux^® in the United States.

Repligen and MIT allege that the cell line that ImClone uses to produce Erbitux^® employs key technology that is claimed in the patent-in-suit. Repligen and MIT also allege that the cell line was created under contract for the National Cancer Institute or NCI by a predecessor to Repligen and subsequently transferred from the NCI to ImClone for use in research and development only. In its summary judgment ruling issued in July 2006 and previously reported by Repligen, the Court found that neither the transfer to the NCI by Repligen’s predecessor nor the subsequent transfer to ImClone by the NCI exhausted the proprietary rights of Repligen and MIT. The Court’s summary judgment ruling eliminated these arguments as a potential defense for ImClone at trial. Repligen and MIT intend to seek damages adequate to compensate Repligen and MIT for ImClone’s unlicensed use of the patented technology and a multiplier of any such damage award based on ImClone’s willful infringement. The outcome of this case is undeterminable at this time.

Bristol-Myers Squibb

In January 2006, Repligen Corporation and Thethe University of Michigan jointly filed a complaint against Bristol-Myers Squibb in the United States District Court for the Eastern District of Texas for infringement of U.S. Patent No. 6,685,941 or (“the ‘941 patentpatent”) for the commercial sale of Orencia^®. The ‘941 patent, entitled “Methods of Treating Autoimmune Disease via CTLA4-Ig,” covers methods of using CTLA4-Ig to treat rheumatoid arthritis, as well as other therapeutic methods. Repligen has exclusive rights to this patent from its owners, the University of Michigan and the U.S. Navy. In February 2006, Bristol-Myers Squibb answered the complaint and counterclaimed seeking a declaratory judgment that the ‘941 patent is invalid and unenforceable and that Bristol-Myers Squibb does not infringe the patent. Jury selection for the trial in this matter is scheduled to commence on April 7, 2008. The outcome of this case is undeterminable at this time.

Other

From time to time, we may be subject to other legal proceedings and claims in the ordinary course of business. We are not currently aware of any such proceedings or claims that we believe will have, individually or in the aggregate, a material adverse effect on our business, financial condition or results of operations.

Recent Sale of Unregistered Securities